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United States: Federal Appellate Court Restores Lawsuit Against French Bank by Victims of Sudanese Regime’s Atrocities

(June 6, 2019) The US Court of Appeals for the Second Circuit recently revived a tort lawsuit brought by victims of the Sudanese regime’s atrocities against BNP Paribas (BNPP), a French bank convicted in 2015 of evading US sanctions on Sudan.  (Kashef v. BNP Paribas SA, No. 18-1301 (2d Cir. 2019) (Kashef), US Court of Appeals for the 2d Circuit website.)

Background

Since 1997, the United States has imposed sanctions on Sudan for human rights atrocities “condemned by the international community as genocide.”  (Kashef at 4; see also Lauren Ploch Blanchard, Cong. Research Serv., IF10182, Sudan (2019).)  BNPP evaded those sanctions by facilitating Sudan’s access to the US financial system. (Kashef at 4–5.)  In 2015, the United States and the State of New York convicted BNPP for violating the sanctions and imposed forfeitures and fines on BNPP amounting to nearly US$9 billion.  (Id. at 5.)

In 2016, the Kashef plaintiffs, victims of the genocide in Sudan, commenced a lawsuit against BNPP.  (Id. at 23.)  The plaintiffs claim that BNPP’s illegal activities enabled Sudan to acquire the funds with which to carry out the genocide and seek to hold BNPP liable under New York tort law for their personal injuries.  (Id. at 8–10.)  BNPP moved to dismiss the plaintiffs’ claims as (1) prohibited by the act of state doctrine and (2) time barred.  (Id. at 10.)  The District Court for the Southern District of New York concluded that the majority of the plaintiffs’ claims are barred by the act of state doctrine, and that those few claims that are not are regardless untimely as to the plaintiffs who were 18 or older at the time of their injuries.  (Id. at 4.)  Accordingly, the District Court dismissed the lawsuit in its entirety.

Act of State Doctrine

The act of state doctrine bars US courts from “declaring invalid, and thus ineffective as a rule of decision, the official act of a foreign sovereign.”  (Kashef at 11; see also US Dep’t of Justice, Antitrust Guidelines for International Enforcement and Cooperation 35–36 (2017).)  The doctrine applies when a US court is required to “declare invalid the official act of a foreign sovereign” in order to adjudicate the case.  (Kashef at 13.)  The doctrine has been previously applied to bar claims challenging the validity a foreign sovereign’s formal decrees or orders.  (Id. at 12.)

Present Appellate Decision

The Second Circuit determined that the court is not required to declare invalid an official act of Sudan in order to adjudicate this case.  First, there is no argument being made by any of the parties to declare valid or invalid the acts of genocide; rather, “the issue is simply whether the atrocities occurred.”  (Kashef at 16.)  Second, there is no argument being made by any of the parties that the genocide was an “official act” of the Sudan; indeed, the genocidal acts clearly violated Sudan’s own laws.  (Id. at 18.)  Third, the atrocities that occurred in Sudan violated jus cogens a “mandatory or peremptory norm of general international law accepted and recognized by the international community as a norm from which no derogation is permitted.”  (Black’s Law Dictionary 990 (10th ed. 2014); see also Kashef at 19–20.)  Applying the act of state doctrine to the Kashef plaintiffs’ claims would require the court to validate violations of nonderogable jus cogens norms, contravening precedent.  (Id. at 20.)  Accordingly, the Court concluded, the Sudanese regime’s atrocities “can never be the basis of a rule of decision capable of triggering the act of state doctrine.”  (Id.)

Finally, the Court held that the adult plaintiffs’ claims are not time barred under New York’s rule that civil claims may be commenced within one year of the termination of a criminal action concerning the same event or transaction from which the civil claim arose.  (Kashef at 21.)  As the complaint was filed within one year of the date on which the judgment of conviction against BNPP was entered, the Court deemed the action timely.  (Id. at 22–23; NY CPLR 215(8)(a).)