US Second Circuit reinstates $656m terror verdict against PLO and Palestinian Authority following Supreme Court ruling on American courts' jurisdiction over Palestinian entities
The US Court of Appeals for the Second Circuit has reinstated a $656.5 million judgment against the Palestine Liberation Organization (PLO) and the Palestinian Authority (PA) in a long-running civil terrorism lawsuit brought by American victims and their families in relation to attacks during the Second Intifada (the period of Palestinian-Israeli violence from 2000 to 2005). The reinstatement follows a US Supreme Court decision in June 2025 that cleared the way for American courts to exercise personal jurisdiction — the legal basis for a court to hear claims against a specific defendant — over the PLO and PA in claims brought under the Anti-Terrorism Act, the US statute that allows American victims of international terrorism to sue in federal courts. The Second Circuit had originally dismissed the case over a decade ago on jurisdictional grounds; the Supreme Court's ruling reversed that position. A central legal issue was the PA's so-called 'pay for slay' policy — payments made by the PA to imprisoned terrorists and their families, including in cases where the attacks killed or injured Americans. The appeals court held that this policy, combined with other contacts with the United States, was sufficient to establish the jurisdictional link needed to bring the case in US courts. The case has been litigated for 22 years. Attorney Kent Yalowitz and Nitsana Darshan-Leitner represented the plaintiff families. The reinstatement restores the original judgment without requiring a new trial.
Why this matters
This decision is significant beyond its specific facts because it confirms that the Anti-Terrorism Act can be used to enforce massive civil judgments against sovereign or quasi-sovereign entities on the basis of funding terrorism against Americans, even where those entities are not themselves US persons. For UK-based commercial lawyers, the international enforcement dimension is the key issue: a $656m judgment against the PLO and PA raises immediate questions about whether and where assets can be identified and seized — a task that requires cross-border asset tracing, analysis of sovereign immunity doctrines under English and international law, and coordination with local counsel across multiple jurisdictions. The jurisdictional framework established — using 'pay for slay' policy as a US contacts hook — may be applied in future cases involving state-adjacent entities funding violence against nationals of countries with similar statutory frameworks. The 'why now' trigger is the Supreme Court's 2025 jurisdictional ruling enabling decades of stalled litigation to complete.
On the Ground
On a cross-border enforcement matter arising from a large US judgment, a trainee would assist with sanctions screening memos — checking whether any proposed enforcement target or its assets are subject to UK, EU, or US sanctions regimes that might complicate asset seizure — and prepare a choice-of-law summary analysing which jurisdiction's sovereign immunity rules apply to the enforcement action in each territory where assets might be located.
Interview prep
Soundbite
A $656m terrorism judgment restored after 22 years — enforcement jurisdiction over sovereign-adjacent entities is now settled US law.
Question you might get
“If a US court has entered a $656m judgment against the Palestinian Authority, what legal obstacles would a creditor face in trying to enforce that judgment in England and Wales, and how does sovereign immunity doctrine apply to entities that are not full states?”
Full answer
The Second Circuit has reinstated a $656.5m judgment against the PLO and Palestinian Authority, following the Supreme Court's June 2025 ruling that US courts can exercise personal jurisdiction over those entities under the Anti-Terrorism Act. The critical legal development is the jurisdictional hook: the PA's 'pay for slay' policy — payments to imprisoned terrorists' families — was held sufficient to establish the US connection required to sue in American courts. For commercial lawyers, the most complex work now begins: enforcing a judgment of this size against quasi-sovereign entities requires multi-jurisdictional asset tracing, engagement with sovereign immunity law in each target jurisdiction, and strategic sequencing of enforcement steps. The wider principle — that funding of violence against a country's nationals creates personal jurisdiction in that country's courts — is one that other jurisdictions, including the UK, may be asked to adopt or resist as enforcement spills across borders.
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