A U.S. Supreme Court justice on Monday refused to freeze a $656 million judgment owed to American victims of terror attacks in Israel, clearing the way for collection efforts to proceed against the Palestinian Authority and the Palestine Liberation Organization while their appeal continues.
Justice Sonia Sotomayor signed the order denying the request to halt payment, which came after the high court ruled last year in favor of the victims and their families. The two Palestinian bodies had asked the justices to pause enforcement pending their challenge to the verdict’s reinstatement.
In their filings, the Palestine Liberation Organization and the Palestinian Authority argued that paying the judgment now could destabilize government services in the West Bank. That argument — essentially a solvency defense — has been the centerpiece of Ramallah’s strategy since the award was revived, and it now carries no procedural weight. Absent further intervention, the plaintiffs may begin pursuing assets.
The financial exposure is substantial relative to the Palestinian Authority’s balance sheet. The body operates on an annual budget in the range of $4 billion to $5 billion, funded largely by tax revenues collected on its behalf by Israel and by international donor support that has contracted sharply over the past decade. A judgment of this size represents a meaningful share of a single year’s spending, and it lands at a moment when the Authority is already running arrears on public-sector salaries and supplier payments.
A Case Two Decades in the Making
The underlying lawsuit was brought by victims of attacks in Jerusalem in the early 2000s that killed 33 people and wounded hundreds more. The families sued under the Anti-Terrorism Act, the federal statute designed to open U.S. courts to victims of international terror attacks.
A Washington-area jury originally awarded roughly $218.5 million, a figure automatically tripled under the statute’s treble-damages provision to arrive at the $655.5 million total now at issue. That mandatory multiplier is the reason the number looms so large — the Anti-Terrorism Act was written to make judgments punishing enough to alter behavior, not merely to compensate.
The path since then has been anything but linear. The 2nd U.S. Circuit Court of Appeals threw out the verdict a decade ago, holding that U.S. courts could not consider lawsuits against foreign groups over overseas attacks that were not aimed at the United States. Congress responded by amending the jurisdictional rules, and the Supreme Court upheld that legislation last June — a decision that pulled the case back to life.
Acting on that ruling, the appeals court reinstated the judgment in a decision dated March 30, concluding that the original award for the plaintiffs should be restored without a new trial. Attorney Kent Yalowitz said at the time that the client families were relieved, after a long wait for justice. Co-counsel Nitsana Darshan-Leitner noted the case had run 22 years.
What Comes Next for Collection
Monday’s order does not end the litigation. The appeal over reinstatement remains live, and the Palestinian side retains the option of seeking review from the full court. What it does end, for now, is the pause — and that shifts the practical question from whether the judgment stands to whether it can be collected.
Collection against foreign governmental entities is notoriously difficult. Plaintiffs’ counsel in comparable Anti-Terrorism Act cases have pursued bank accounts held in U.S. correspondent institutions, real property, investment holdings and receivables owed by American counterparties. Each avenue invites its own round of litigation, and sovereign-adjacent defendants routinely contest whether particular assets are reachable at all.
There is also a diplomatic dimension that businesses with regional exposure will watch closely. Enforcement actions touching Palestinian Authority accounts could complicate the banking relationships that move donor funds and clearing payments through the territories — a channel that international lenders and correspondent banks have already been trimming on compliance grounds. Any disruption there ripples into trade financing for firms operating in or through the area.
For the families, the significance is more direct. Twenty-two years of procedural reversals produced a verdict, its erasure, a legislative fix, a Supreme Court affirmation and a reinstatement. Monday removed one more obstacle standing between that paper judgment and actual payment.
JBizNews Desk | Washington
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