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N.Y. Forum Denied for Suit Over Terror Attack in Egypt
New York Law Journal
November 19, 2008
Israeli and Russian victims of a 2004 terror attack on an Egyptian Hilton cannot sue the hotel in the United States, in part because a judge believed they were seeking a higher recovery from a New York jury sitting blocks from the World Trade Center site.
Southern District Judge Peter Leisure found that the plaintiffs, none of whom were Americans, may have been engaging in forum shopping in Niv v. Hilton Hotels Corp., 06 Civ. 7839, and he dismissed the case under the doctrine of forum non conveniens.
On Oct. 7, 2004, dozens were killed and wounded when a terrorist drove a vehicle packed with explosives into the lobby of the Hilton Taba Hotel in Taba City, South Sinai.
The plaintiffs, 157 people who were guests at the hotel or descendants of guests, sued in New York, claiming the hotel's security was below standard in light of warnings from Israeli intelligence about the likelihood of attacks, particularly around the Jewish holidays.
Attorneys for the hotel argued the case should be heard in Egypt, and Judge Leisure should dismiss on the theory of forum non conveniens because there were no U.S. citizens or residents involved, the event took place in Egypt and all of the relevant documents and witnesses were in Egypt.
Judge Leisure applied the three-step analysis outlined by the Second Circuit in Iragorri v. United Technologies Corp., 274 F.3d 65 (2d Cir. 2001) (en banc), by probing the degree of deference afforded the plaintiffs' choice of forum, examining the adequacy of the alternative forum and balancing the private and public interests implicated in the choice of forum.
The judge found the plaintiffs' choice here was not entitled to substantial deference.
"There is no indication that plaintiffs, who are Israeli and Russian citizens and residents, have any connection to this district or to the United States that would increase the deference accorded to plaintiffs' choice of forum," he said, noting that none of the evidence or witnesses were in New York and "there is some evidence that the plaintiffs' engaged in forum shopping."
Judge Leisure cited a newspaper article brought to his attention by the defendants in which plaintiffs' Israeli counsel, Moishe Zingel, was quoted as saying the claim was filed in New York because of "the awareness of the Americans to terror activities since the Twin Towers disaster, and the fact that the proceedings there will be conducted before a jury, which usually awards higher amounts of compensation, including penalty compensation."
Judge Leisure said, "While this statement is not dispositive of the deference this court should give to plaintiffs' choice of forum, it does indicate that the generosity of juries in this district was a consideration for plaintiffs in deciding to bring suit here. Such consideration is indicative of forum shopping."
The judge made his decision despite the plaintiffs' argument that the defendants, Hilton Hotels Corp. and Hilton International Co., are domiciled in New York, registered to do business here, and derive substantial revenues from New York. The Israeli and Jewish plaintiffs also claimed Egypt was not an option because of the "pervasive and virulent anti-Semitism and anti-Israeli bias that permeates Egypt."
On the last point, Judge Leisure noted that, while there are "emotional burdens" to bringing suit in Egypt, the plaintiffs were still free to bring suit in Israel, which is a more appropriate forum than the United States for several reasons.
He also said he was refraining from "finding Egypt to be an inadequate forum based upon the perception that Egyptian courts are too biased or corrupt to provide Jewish or Israeli plaintiffs with a fair trial."
Judge Leisure issued his dismissal without prejudice, but conditioned it on "effective initiation" of a lawsuit in Egypt or Israel within 60 days.
Robert Sentner and Tamar Y. Duvdevani of Nixon Peabody represented the plaintiffs.
William P. Kardaras, Lori S. Kahn and Louise A. Kelleher of Kardaras & Kelleher and Hilarie Bass and Mark A. Salky of Greenberg Traurig represented the defendants.
Kardaras declined to comment on the decision.
