Insurers Entitled To Judgment On Default Against Syria for International Act of Terrorism Under New U.S. Statute

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Certain Underwriters at Lloyd’s, London, et al. v. Great Socialist People’s Libian Arab Jamahiriya, et al., Civil Action No. 06-cv-731 (JMF) (D.D.C. 2011), are two actions. The primary remaining defendants include Syria and seek damages for acts of state-sponsored terrorism that resulted in the hijacking of EgyptAir Flight 648 on Nov. 23, 1985. The aircraft was destroyed, and the plaintiffs here, Lloyd’s syndicates, seek the value of the insurance claims paid (75.5% of the original insurance policy based on a total recoverable loss of $11,043,660.83).

The decision shows the operation of the new statute, 28 U.S.C. sec. 1605A, which replaced old Section 1605(a)(7) (see our prior discussions, e.g., here). The key aspect of this decision for international practice purposes includes the creation of a federal cause of action for state-sponsored terrorism, rather than the prior law, which provided only a federal forum for state law claims. The Court permitted a retroactive application of the new statute under the “belts-and-suspenders” approach endorsed by Chief Judge Lamberth in In re: Islamic Republic of Iran Terrorism Litigation, 659 F.Supp. 2d 31 (D.D.C. 2009) (discussed here). The Court also applied the law on what evidence must be shown to secure a judgment in the face of the defendants’ default (discussed here).

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