Owens v. Taliban

Background

The plaintiffs are surviving victims, estates of victims who died, and family members of victims of al-Qaeda’s 1998 terrorist attacks on U.S. embassies in Kenya and Tanzania. They seek to collect on a future judgment against the Taliban.

The court had previously entered a preliminary attachment of funds held by Afghanistan’s central bank, Da Afghanistan Bank, at the Federal Reserve Bank of New York. A preliminary attachment is a temporary seizure or restraint of property before a final judgment. The plaintiffs later asked the court to confirm that attachment. In the earlier decision, the court refused to confirm it, ruling that the funds were immune from attachment under Section 1611 of the Foreign Sovereign Immunities Act, or FSIA. The plaintiffs then moved to stay that decision while seeking appellate review. A stay would temporarily pause the effect of the decision.

The court’s analysis

The court applied four factors used to decide whether to grant a stay pending appeal: the applicant’s likelihood of success, the risk of irreparable injury without a stay, possible harm to other interested parties, and the public interest. The court said the first two factors were the most important.

Likelihood of success

The plaintiffs argued that the court had acted too quickly after receiving a statement of interest from the Government and had improperly considered the FSIA on its own initiative. The court rejected those arguments. It said the plaintiffs had already addressed the Government’s expected position in their earlier briefing and had three weeks to request additional briefing.

The court also explained that funds held in an account in the name of a central bank or monetary authority are presumed immune from attachment under the FSIA. Because the funds were held in the name of Afghanistan’s central bank, the plaintiffs had to overcome that presumption by showing that the funds were not being used for the bank’s own account. The court concluded that the plaintiffs had not identified serious questions about its prior ruling. It also stated that evidence that the Taliban controlled the bank’s operations was not the same as evidence that the bank’s assets had become the Taliban’s assets.

The court further distinguished its own role from the Executive Branch’s role. It said courts decide whether the FSIA applies, but the Executive Branch has a role in determining the sovereign status of a nation or its central bank. The court also noted uncertainty about whether the prior attachment decision was appealable, although the Second Circuit would ultimately decide its jurisdiction.

Irreparable injury

The plaintiffs argued that the funds were limited and might be unfrozen or otherwise disposed of before they could obtain what they considered their fair share. The court found that these possibilities did not establish irreparable injury. It emphasized that the plaintiffs would still have to prove that the funds belonged to the Taliban, its agent, or its instrumentality under the Terrorism Risk Insurance Act before obtaining turnover of the funds. The court said the plaintiffs had not identified such proof.

Other parties and the public interest

The court concluded that granting a stay could injure other interested parties and would not serve the public interest. It stated that a stay would undermine the denial of the plaintiffs’ request to confirm the attachment and would conflict with strong national interests in respecting the sovereignty of other countries’ central banks.

Disposition

The court denied the plaintiffs’ request to stay its decision denying confirmation of the pre-judgment attachment order. It directed the Clerk of Court to close the motion at Docket Entry 83.