Dist. Ct. erred in dismissing plaintiffs’ lawsuit seeking to enforce $156 million judgment in action under federal Anti-Terrorism Act, alleging that several American nonprofit organizations aided Hamas, who killed plaintiff’s son while son was studying abroad in Israel. Instant lawsuit sought recovery against two different American entities and three individuals who, according to plaintiffs, were alter egos of now defunct original defendants, and thus were liable for remainder of $156 million judgment. Dist. Ct., though, after allowing only limited discovery, found that new defendants were not alter egos of original defendants and then dismissed instant action for lack of subject matter jurisdiction. Ct. of Appeals, however, in remanding matter to Dist. Ct., held that: (1) Dist. Ct’s finding on alter ego question constituted improper merits determination that went beyond proper jurisdictional inquiry; and (2) because instant action arises under section 2333(a) of Anti-Terrorism Act, where plaintiff had alleged that new entity merely operated under new name of one original defendant, Dist. Ct. had jurisdiction over matter and should have allowed case to proceed on its merits that was consistent with ordinary course of civil litigation. Ct. further noted that Dist. Ct., when resolving jurisdictional issue, improperly failed to presume truth of plaintiffs’ allegations or take facts in light most favorable to plaintiffs.
Federal 7th Circuit Court
Civil Court
Jurisdiction