1 56fWterC 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------------------------------x 2 3 In re Terrorist Attacks on 3 September 11, 2001, 4 4 03 MD 1570 (RCC) 5 ------------------------------x 5 New York, N.Y. 6 June 15, 2005 6 10:00 a.m. 7 7 Before: 8 8 HON. RICHARD CONWAY CASEY, 9 9 District Judge 10 10 APPEARANCES 11 11 KREINDLER & KREINDLER 12 Attorneys for Ashton Plaintiffs 12 BY: JAMES P. KREINDLER 13 ANDREW J. MALONEY 13 VINCENT I. PARRETT 14 14 HANLY CONROY BIERSTEIN & SHERIDAN, LLP 15 Attorneys for Burnett Plaintiffs 15 BY: ANDREA BIERSTEIN 16 -and- 16 MOTLEY RICE, LLP 17 BY: MICHAEL E. ELSNER 17 JUSTIN B. KAPLAN 18 18 19 DICKSTEIN SHAPIRO MORIN & OSHINSKY 19 Attorneys for Plaintiffs Cantor Fitzgerald and Port 20 Authority 20 BY: STACEY SAIONTZ 21 21 BRODER & REITER 22 Attorneys for Schneider Plaintiffs 22 BY: JONATHAN C. REITER 23 23 J.D. O'BRIEN & ASSOCIATES 24 Attorneys for Tremsky Plaintiffs 24 BY: DAVID O'BRIEN 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2 56fWterC 1 1 COZEN O'CONNOR 2 Attorneys for Federal Insurance Plaintiffs 2 BY: SEAN P. CARTER 3 3 RICH HAILEY 4 Attorney for Havlish Plaintiffs 4 5 JEFFREY S. GOLDMAN 5 FREDERICK J. SALEK 6 Attorney for O'Neil Plaintiffs 6 7 SPEISER, KRAUSE, NOLAN & GRANITO 7 Attorneys for Plaintiffs' Steering Committee 8 BY: KENNETH P. NOLAN 8 9 JONES DAY 9 Attorneys for Defendants Saudi Bin Laden Group 10 Bakr Bin Ladin, Omar Bin Ladin, Tariq Bin Ladin 10 BY: JAMES E. GAUCH 11 STEPHEN J. BROGAN 11 MELISSA D. STEAR 12 12 WILLIAMS & CONNOLLY 13 Attorneys for Defendant Abdul Rahman Bin Kahlid Bin 13 Mahfouz 14 BY: PETER J. KAHN 14 THOMAS C. VILES 15 JOHN L. CUDDIHY 15 16 WHITE & CASE 16 Attorneys for Defendant Al Rajhi 17 Banking & Investment Corp. 17 BY: CHRISTOPHER M. CURRAN 18 NICOLE E. ERB 18 19 HUNTON & WILLIAMS 19 Attorneys for Defendant Yassin Abdullah Al Kadi 20 BY: BONNIE K. ARTHUR 20 21 JOSHUA L. DRATEL, P.C. 21 Attorneys for Defendant Sami Omar Al-Hussayen 22 BY: MARSHALL A. MINTZ 22 23 PATTON BOGGS 23 Attorneys for Defendant National Commercial Bank 24 BY: RONALD S. LIEBMAN 24 MITCHELL BERGER 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 3 56fWterC 1 KELLOGG, HUBER, HANSEN, TODD & EVANS 1 Attorneys for Defendants Prince Turki Al-Faisal Bin 2 Abdulazia Al-Saud, Prince Bandar Bin Sultan Bin Abdulaziz, 2 Princess Haifa Al-Faisal, and the Kingdom of Saudi Arabia 3 BY: MICHAEL J. GUZMAN 3 4 KING & SPALDING 4 Attorneys for Defendant Arab Bank, PLC 5 BY: RICHARD T. MAROONEY, JR. 5 6 WILMER CUTLER PICKERING HALE and DORR, LLP 6 Attorneys for Defendant Mohamed Al-Faisal Al-Saud 7 BY: LOUIS R. COHEN 7 DAVID P. DONOVAN 8 8 SHEARMAN & STERLING 9 Attorneys for Defendant Saudi American Bank 9 BY: DANIEL M. SEGAL 10 10 BAKER BOTTS 11 Attorneys for Defendants HRH Prince Sultan Abdulaziz 11 Al-Saud and HRH Prince Salman Bin Abdulaziz Al-Saud 12 BY: CASEY COOPER 12 JAMIE S. KILBERG 13 13 DLA PIPER RUDNICK GRAY CARY US LLP 14 Attorneys for Defendants African Muslim Agency, Heritage 14 Education Trust, International Institute of Islamic 15 Thought, Mar-Jac Investments, Inc., Reston Investments, 15 Inc. Safa Trust, York Foundation, Taha Al-Alwani, Muhammad 16 Ashraf, M. Omar Ashraf, M. Yaqub Mirza, Iqbal Unus, Jamal 16 Barzinji, Sterling Management Group, Sterling Charitable 17 Gift Fund, Inc., Mena Corporation, Grove Corporate, Inc. 17 and Sana-Bell, Inc. 18 BY: STEVEN K. BARENTZEN 18 19 BERNABEI & KATZ 19 Attorneys for Defendants Dr. Abdullah M. Al-Turki, Dr. 20 Abdulla Naseef, Dr. Abdullah Al-Obaid, Dr. Abdul Rahman Al 20 Swailem, Sheik Saleh Al-Hussayen, Sheik Shahir Batterjee, 21 Mushayt for Trading Company, Mohammed Al Sayed Mushayt, 21 Sheik Hamad Al-Husaini, Saudi Arabian Red Crescent 22 Society, Sheik Salman Al-Oadah, Sheik Safer Al-Hawali, Al 22 Haramain Islamic Foundation, Inc. Soliman H.S. Al-Buthi, 23 Soliman J. Khuderia, Talal M. Badkook, Dr. Adnan Basha and 23 Perouz Seda Ghaty 24 BY: ALAN R. KABAT 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 4 56fWterC 1 GILLEN PARKER & WITHERS 1 Attorneys for Defendant Zahir H. Kazmi 2 BY: WILMER PARKER 2 3 MARTIN F. McMAHON & ASSOCIATES 3 Attorneys for Defendants Saleh Abdullah Kamei, Al Baraka 4 Investment & Development Corp., International Islamic 4 Relief Organization, Rabita Trust, Dallah Al Baraka Group, 5 LLC, Makkah Mukarrahman Charity Trust and Wael Jalaidan 5 BY: MARTIN F. McMAHON 6 JASON A. DZUBOW 6 CHRISTOPHER SMITH 7 7 BRYAN CAVE, LLP 8 Attorneys for Defendant Prince Naif bin Abdulazia Al-Saud 8 BY: JAMES M. COLE 9 JAMES J. MURPHY 10 BANCROFT ASSOCIATES PLLC 10 Attorneys for Defendant Yousef Jameel 11 BY: VIET D. DINH 11 12 CURTIS, MALLET-PREVOST, COLT & MOSLE, LLP 12 Attorneys for Defendants HRH Prince Abdullah Al Faisal Bin 13 Abdulaziz Al Saud, Alfaisaliah Group, Faisal Group Holding 13 Co. and Mohammed Bin Abdulrahman Al Ariefy 14 BY: DARIA M. CIAPUTA 14 15 STEPTOE & JOHNSON, LLP 15 Attorneys for Defendant Mohammad Bin Abdullah Aljomaih 16 BY: CHRISTOPHER T. LUTZ 16 17 ROBBINS, RUSSELL, ENGLERT, ORSECK & UNTEREINER, LLP 17 Attorneys for Defendant Saudi High Commission 18 BY: ROY T. ENGLERT, JR. 18 19 LEWIS & ASSOCIATES 19 Attorneys for Defendants Success Foundation, Abdulrahman 20 Alamoudi, Tariq Hamdi 20 BY: MAHER HANANIA 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 5 56fWterC 1 (Case called) 2 (In open court) 3 THE COURT: Good morning, please be seated. 4 THE DEPUTY CLERK: Your Honor, now before the Court 5 this morning, In Re Terrorist Attacks on September 11, 2001, 6 docket No. 03 MDL 1570. 7 THE COURT: Okay. Mr. Parker, will you be leading 8 off? 9 MR. PARKER: I will, your Honor. 10 THE COURT: All right. You may proceed. 11 MR. PARKER: Thank you very much, your Honor. I will 12 be giving an opening and reserving a few minutes for rebuttal, 13 with the Court's permission. 14 THE COURT: Very well. 15 MR. PARKER: As I indicated, your Honor, I represent 16 Mar-Jac Poultry, Inc., one of the named defendants in the three 17 complaints, Ashton, Burnett, and Federal. Mar-Jac is a 18 domestic corporation, incorporated in the State of Georgia. 19 Let me begin by a matter of housekeeping issue. 20 In the Burnett matter, we filed a motion attacking not 21 only the failure to state a claim under 12(b)(6) but also 22 raising the issue of improper service. We're abandoning or 23 otherwise withdrawing the arguments on behalf of improper 24 service and are simply proceeding on Burnett as we are in 25 Ashton and Federal on the 12(b)(6) motion. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 6 56fWterC 1 THE COURT: Very well, sir. 2 MR. PARKER: There are two matters I'd like to raise 3 in reference to the Court's order of January 18, 2005, that I 4 think are just slightly a misstatement. 5 First, your Honor, and I'm referencing the page 6 numbers as found in the Westlaw publication of the Court's 7 order which is at 349 F.Supp.2d 765. On page 781, footnote 9, 8 the Court stated: "The SAAR network moves to dismiss the 9 Federal Insurance complaint." 10 I would suggest that that was a slight misstatement in 11 the sense that there is no such thing as the SAAR network. 12 There are various entities that have made various motions, but 13 it itself is not an entity, your Honor. 14 Second, on page 832, the Court stated, "The Al Rajhi 15 family is purportedly a major donor to the SAAR network, a 16 defendant here, being investigated by federal authorities in 17 Virginia." And the Court referenced the Burnett complaint at 18 paragraphs 80 through 84. Again, there is no such thing as a 19 SAAR network which is a defendant. There is no defendant 20 identified by the name SAAR network. 21 There is a defendant identified by the name SAAR 22 Foundation, Inc. That is a named defendant and is prominently 23 discussed in both Ashton and Burnett complaints as well as 24 mentioned in the Federal complaint. But that entity was 25 formally dissolved by the State of Virginia, in December 2000, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 7 56fWterC 1 and that's acknowledged by the plaintiffs in the Ashton brief 2 at page 1. So that entity was a nonexisting entity at the time 3 of the events of 9/11 of 2001. 4 Now, in your order of January, you indicated that the 5 Court "must accept as true the plaintiffs' allegations 6 concerning the relationships of the SAAR network." But you 7 further stated "that the defendants correctly argue, however, 8 that there is scant basis for linking these entities under the 9 SAAR network title." 10 I would suggest that there is even less than scant 11 basis for any such linkage under such made-up moniker, your 12 Honor, and I will try to point that out. 13 First, the plaintiffs themselves cannot agree among 14 themselves on who are members of this co called SAAR network. 15 In the Burnett complaint at paragraph 267, and in the Ashton 16 complaint -- and, I apologize, I'm referring to the third 17 amended Ashton complaint, not the fourth. But at paragraph 338 18 of the third, it is alleged that, it is alleged that the 19 defendants of the SAAR network are listed. In both Ashton and 20 Burnett, the so-called Saudi charities, IIRO, WAMY, and the 21 Muslim World League, are not listed under the moniker of the 22 SAAR network. Rather, it is alleged that they, those 23 charities, are "closely intertwined" with the SAAR network 24 defendants, and I reference paragraphs 266 and 338. 25 Now, that's not the case in the Federal complaint. As SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 8 56fWterC 1 the Court noted in its order of January, in the Federal 2 complaint, it is alleged that those charities "U.S. branches" 3 are included within the moniker of the SAAR network, which the 4 Federal complaint described as "interrelated charities" 5 established in the 1980s "to generate and surreptitiously 6 transfer funds to terrorist organizations, including Al Qaeda." 7 That's paragraph 222. 8 So what exactly is the plaintiffs' theory? And it is 9 indeed a theory; it is not facts, your Honor. Are IIRO, WAMY 10 and MWL part of the so-called SAAR network, or are they just 11 "closely intertwined," whatever that may mean? I would suggest 12 it really doesn't matter because by pleading the case as the 13 plaintiffs have pled, grouping all of these various defendants 14 as part of some organization or a network, without pleading 15 specific detailed facts, as opposed to mere conclusions, such 16 as many organizations have common members of management or 17 members of the board or many organizations are located at the 18 same address, but in saying that, failing to identify which 19 organizations, which members, which address, without giving any 20 further details as to why anyone in that group may be even 21 considered an agent of anyone else in that group, those 22 pleadings, your Honor, violate the requirements of Rule 8. 23 That is, lumping the various defendants together in this 24 self-invented network fails to satisfy the minimum pleading 25 requirements of Rule 8. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 9 56fWterC 1 Accordingly, they're all general conclusory assertions 2 about the so-called SAAR network without any direct linkage of 3 specifically pled facts to Mar-Jac Poultry and should not be 4 allowed to defeat Mar-Jac Poultry's motion to dismiss. 5 You know, your Honor, it's very easy for a member of 6 the bar to make wholly unsupported and ultimately unsustainable 7 allegations about a nonexistent network. I mean, Rule 11, 8 while it governs these pleadings, I suggest, does not apply to 9 a nonexistent entity. So I would suggest that plaintiffs may 10 be able to say whatever they care to say about a so-called 11 nonexistent entity with impunity, not being required, as they 12 might be otherwise under Rule 11, to account for what is 13 otherwise their cavalier conduct. 14 Now, who is Mar-Jac Poultry, Inc., my client? I said 15 it was a domestic corporation, incorporated in Georgia. It 16 dates back in its origins to 1948, to individuals Marvin and 17 Jackson McGiven, who are members of a rural Georgia community. 18 Mar-Jac is a fully integrated poultry company with its plant 19 and businesses in Gainesville, Georgia, a town of approximately 20 25,000, located 50 miles northeast of Atlanta. 21 It operates poultry hatcheries, contracts with more 22 than 350 poultry growers. It owns feed mills which produce 23 more than 5,000 tons of feed per week. It runs one of the most 24 modern facilities in the country. It employs over 1,200 25 people, in Gainesville and the surrounding area. And at its SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 10 56fWterC 1 peek capacity, it processes 20,000 birds an hour. 2 On its premises daily are inspectors from the United 3 States Department of Agriculture inspecting all the products as 4 they are being processed to ensure the safety and health of 5 consumers. Contrary to the allegations in the complaint, we 6 conduct our business at our business address. We have a 7 physical presence, and anyone would know that once you got 8 close to our plant; your nose would tell you that. 9 We've had long-standing banking relationships with 10 many financial institutions throughout the years and had a 11 banking relationship with the Bank of America from 1996 up 12 through the events of 9/11. We have had ourselves constantly 13 audited by outside auditors for going back over 20 years. In 14 fact, we have and continue to have an established paper trail. 15 Let me tell you what Mar-Jac Poultry is not. We're 16 not a charity. We're not a shell company. And we're not a 17 front for financing Al Qaeda, Osama Bin Laden or any other 18 alleged terrorists. 19 Now, the plaintiffs concede that their theories of 20 liability against the so-called members of the SAAR network, 21 including Mar-Jac, are based on conspiracy and aiding and 22 abetting theories, which the Court has addressed in its January 23 order. The task at hand then is to apply those theories to the 24 pled facts, and I emphasize pled facts as opposed to what is 25 stated in necessarily pleadings. But before I address pled SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 11 56fWterC 1 facts, let me make it clear what is not pled. 2 In not one complaint is it pled that Mar-Jac Poultry 3 distributed or contributed or provided any money to Al Qaeda or 4 Osama Bin Laden. In not one complaint is it pled that Mar-Jac 5 Poultry distributed or contributed or provided any money to any 6 entity or individual knowing that that entity or individual in 7 turn would provide money to Al Qaeda or Osama Bin Laden. In 8 fact, there is no allegation in any complaint that Mar-Jac 9 Poultry provided any money to IIRO, WAMY, MWL, Al Haramain, 10 Saudi High Commission, Saudi Joint Relief Commission, Saudi Red 11 Crescent, or any other charity that the plaintiffs allege may 12 have supported Al Qaeda or Osama Bin Laden. None. No 13 allegations whatsoever. 14 There is no allegation in any of the complaints that 15 Mar-Jac Poultry provided any monies to a designated person or 16 entity. There is an allegation in the Federal complaint, at 17 paragraph 228, which the Court noted in its January order, of 18 an allegation that the "SAAR entities'" funds have been 19 transferred to Youseff Nada and Ahmed Nasreddin, which were 20 identified in that paragraph as designated individuals. But as 21 you heard yesterday, those individuals were not designated 22 prior to September the 11th, 2001. They were not designated 23 until after September the 11th, 2001. 24 Second, there is no allegation as to who within the 25 so-called SAAR entities transferred those monies. Were the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 12 56fWterC 1 Federal plaintiffs talking about IIRO or WAMY, or WML, who they 2 described as being in the so-called SAAR network, or are they 3 talking about someone else? This is the problem. This is the 4 root laid problem that is presented here by this graphic 5 characterization. 6 There certainly is no allegation in that paragraph 7 that any transfer of any monies to those individuals was known 8 by whoever transferred those monies to be used to support Al 9 Qaeda or Osama Bin Laden, and that transfer would have had to 10 have been pre-9/11 to be relevant to the causation issues 11 before this Court. Clearly transfers post-9/11 would not be 12 relevant; there is no reference as to the timing of the 13 transfers. 14 So what is alleged, your Honor? In both Burnett and 15 Ashton, Mar-Jac Poultry is alleged to be a member of a 16 so-called network and is described as an "coconspirator, an 17 aider and abetter of defendant SAAR Foundation," which sponsors 18 international terrorism. How the SAAR Foundation, by September 19 11, 2001, which was already dissolved by December of 2000, 20 could be a sponsor of terrorism, how that could be a legal 21 matter, I'm not certain. But that's not the issue. That's 22 simply a conclusory allegation. There are no details to that. 23 It is also alleged in both Burnett and Ashton that 24 Mar-Jac Poultry provided allegedly a "business presence" to the 25 "alleged participants in the so-called Al Rajhi Banking SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 13 56fWterC 1 scheme." Well, whatever providing a business presence may 2 mean, it certainly does not mean anything that involves 3 wrongdoing or wrongful conduct that is germane to the 4 complaints before this Court. Again, those are mere conclusory 5 assertions. The Court dealt with those kinds of issues in its 6 January order and found them insufficient. 7 These assertions do not provide any details that 8 satisfy Rule 8. Mar-Jac is unaware of and is not put on notice 9 as to what, if anything, is alleged about it, in connection 10 with those claims. And there are certainly no facts that 11 establish why liability should attach to Mar-Jac Poultry for 12 the horrific events of 9/11. 13 Now, the Federal complaint pled a little bit more, and 14 the Court noted that in its January order. I've already 15 discussed the Nada issue, and I've already discussed the 16 difference between the Ashton-Burnett definitions of the SAAR 17 network and Federal's; that is, relating to whether the 18 so-called Saudi charities -- IIRO, WAMY, and MWL -- are part of 19 this alleged SAAR network. 20 A possible explanation as to why there's a difference 21 in theory, your Honor, I believe may be found in what is also 22 referenced in the Federal complaint, and that is in the Federal 23 complaint at paragraph 227. They reference a federal 24 investigation that resulted from searches and seizures executed 25 on March the 20th of 2002, and they allege in part that many of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 14 56fWterC 1 the SAAR entities were searched and seized at their locations 2 and that there's an ongoing federal investigation, and this 3 part, this fact was even discussed in the last oral arguments 4 before this Court. 5 Now, let me make clear what happened on that date and 6 where it happened. The searches and seizures in northern 7 Virginia were at many different locations. Yes, indeed, 8 Mar-Jac Poultry was searched in Georgia. All of the computers 9 were seized. All of the books and records were seized, the 10 entire information that documented Mar-Jac's movements of 11 monies. 12 In the northern Virginia area, there were searches 13 executed at two addresses at Grove Street, 555 Grove Street and 14 500 Grove Street. Those searches, together with the Mar-Jac 15 Poultry search, were supported by an affidavit signed by 16 Special Agent David Kane of the United States, then of the 17 United States Customs Service, on March the 12th, 2002. 18 In separate affidavit, your Honor, not the affidavit 19 used to search the Grove Street addresses and Mar-Jac Poultry, 20 but a separate affidavit was prepared that was used to search 21 360 South Washington Street, and it was referenced by 22 Mr. Kreindler yesterday; that is, the search at 360 South 23 Washington. And you may recall from yesterday, Mr. Kreindler 24 talking about offices of IIRO being located at 360 South 25 Washington. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 15 56fWterC 1 Well, let me tell you who else was located there. The 2 offices of the Muslim World League were also located at 360 3 South Washington, as was WAMY. I will tell you who wasn't 4 located at 360 South Washington, and that was who Agent Kane 5 described in his affidavit as the "SAFA group." 6 The SAFA group, in that affidavit, are Mar-Jac 7 Poultry, Inc., Mar-Jac Investments, all of the various other 8 entities identified by, before the Court in the last motion to 9 dismiss. They are separate and apart in physical locations. 10 And the probable cause underlining the search of Mar-Jac 11 Poultry is entirely different from the probable cause 12 underlining of the search of 360 South Washington. How do we 13 know that? Because the affidavit for Mar-Jac Poultry has been 14 unsealed. 15 Now, when I make these statements, I want to bring 16 something to the Court's attention. In the Ashton pleading on 17 page 1, in response to Mar-Jac Poultry's motion to dismiss, it 18 is stated "Indeed, the SAAR Foundation address on Grove Street 19 in Herndon, Virginia, was shared by more than 100 affiliated 20 organizations, including defendant Muslim World League, another 21 terrorist-supporting group whose assets were frozen by the U.S. 22 because of its terrorism links." They then reference their 23 paragraphs 334 and 375 for support of that assertion to the 24 Court. 25 If you look at those paragraphs, your Honor, it does SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 16 56fWterC 1 not support that assertion. That's a misrepresentation of what 2 is contained in those paragraphs. It is not true that the 3 Muslim World League had its address at the SAAR Foundation 4 address on Grove Street, and for them to represent that it was, 5 when in fact it's not supported by their complaint is a 6 misrepresentation to the Court. 7 Let me go back to the David Kane affidavit, supporting 8 the search of Mar-Jac Poultry and other individuals in northern 9 Virginia. In that affidavit, it is unquestionably clear that 10 one unmistakable fact is obvious, that there is no allegation 11 in that affidavit that supports probable cause to search any 12 location identified in that affidavit for alleged evidence 13 relating to Osama Bin Laden, Al Qaeda. That affidavit is 14 premised on allegations involving one Sami Al Arian and the 15 Holy Land Foundation. Sami Al Arian is currently on trial in 16 the United States District Court for the Middle District of 17 Florida, Tampa Division. 18 Now, the Holy Land Foundation has been indicted and is 19 being prosecuted for alleged support to Hamas. Sami Al Arian 20 is being prosecuted by the government of the United States 21 which alleges that he was the primary person who collected 22 monies in support of Palestinian, Palestine Islamic Jihad. The 23 irony is that the representation of Sami Al Arian before the 24 United States District Court is by the same law firm, Cozen & 25 O'Connor, who is representing the plaintiffs in the case before SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 17 56fWterC 1 this Court. 2 I am quite certain that Cozen & O'Connor knows very 3 well that the Sami Al Arian case has nothing to do with Al 4 Qaeda or Osama Bin Laden because, otherwise, they would have a 5 major conflict. And I'm quite certain that they know exactly 6 what the Al Arian allegations are and that that's part of the 7 Kane affidavit supporting the search. 8 I make these points, Judge, because they want you to 9 infer that because there's a government investigation of 10 Mar-Jac Poultry, Inc. and its principals that it somehow has 11 something to do with Al Qaeda and Osama Bin Laden. It does 12 not. And as the Court's already noted in its January order, 13 there is no allegation of linkage between Palestinian Islamic 14 Jihad and Hamas and the events of 9/11 that are the gravamen 15 before this Court. 16 One other point needs to be made. Since that search 17 warrant, no activity has happened. It's been in excess of 18 three years. There have been many representations in many 19 courts as to whether or not the government is still 20 investigating us. One thing's for sure, they have had access 21 to all of our documents, all of our materials, and all of the 22 information, and there are no charges brought, period, I 23 suggest, because there is no evidence to base them on. 24 I have a few other parts to make, your Honor. First, 25 there's the issue of vicarious liability. The Court recognized SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 18 56fWterC 1 that issue in its January order when it wrote down that similar 2 allegations concerning the Al Rajhi family cannot support a 3 claim against the Al Rajhi Bank because there is no allegation 4 that "the family members were acting in furtherance of the Al 5 Rajhi Bank business." There are no allegations in the 6 complaints, your Honor, of any Federal, Burnett, or Ashton 7 which establish any facts that any agent of Mar-Jac Poultry, 8 Inc., acting in furtherance of Mar-Jac Poultry, Inc.'s 9 business, engaged in any conduct, or that would support any 10 theory of causation or any claim in any of the complaints. 11 Absent allegations of agents of Mar-Jac engaging in 12 any conduct that it could be held vicariously liable for, which 13 might be based on, which might prove causation on any and all 14 of the claims in the complaints, Mar-Jac Poultry cannot, as a 15 matter of law, be held liable. 16 I say again though, there are no allegations in the 17 complaint. Nonetheless, the Federal plaintiffs in their 18 papers, in response to Mar-Jac motions, Mar-Jac Poultry's 19 motion on page 4, said -- the Federal plaintiffs' complaint 20 alleges that Dr. Barzinji "as an officer of Mar-Jac engaged in 21 criminal activities consistent with his known activities as a 22 member and manager of these SAAR network entities." And they 23 reference paragraphs 490 and 491 of their complaint. 24 Again, as with the situation involving the Ashton 25 pleading, if you go to those paragraphs, 490 and 491, you find SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 19 56fWterC 1 they do not support that assertion that Dr. Barzinji, "as an 2 officer of Mar-Jac" engaged in any criminal conduct. So I urge 3 the Court to scrutinize closely the statements in the pleadings 4 and compare those critically against what is pled in the 5 complaints. 6 Lastly, in closing, your Honor, in light of the 7 Court's rulings in January, Mar-Jac Poultry, of course, adopted 8 and urges the Court to dismiss the RICO claims against both it 9 in the Federal case and in the Burnett case, based on the same 10 finding that the Court made that no pleading was made of 11 Mar-Jac Poultry participating in the management of any alleged 12 RICO enterprise. As to the TVPA claim, Mar-Jac Poultry being a 13 corporation is not subject to that statute, as the Court noted, 14 and as to the New York causes of action, the Court noted that 15 Federal filed those claims after the statute of limitations had 16 expired. Of course, we argue and move for the complete 17 dismissal of all claims in all three complaints. 18 Thank you very much. 19 THE COURT: Thank you, Mr. Parker. 20 MR. CARTER: Good morning, your Honor. Sean Carter 21 for the plaintiffs. I'll be responding to Mr. Parker's 22 arguments. 23 At the outset, I'd like to make clear, your Honor, 24 that as an officer of the Court, I do not view the rules to 25 permit me to include complete fabrications in a pleading that's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 20 56fWterC 1 filed with the Court, and I don't believe that any of the other 2 plaintiffs feel that they're entitled to do so either. And I 3 take issue with that implication. 4 With respect to the issue raised regarding my firm's 5 representation of an individual named Sami Al Arian in Florida, 6 I would say only this, your Honor, that Ms. Lugy, who is 7 cocounsel for the SAAR defendants, raised this issue informally 8 almost a year ago, I would expect, after one of the first 9 hearings in this case. It was directed to my firm's conflicts 10 committee who, as I understand it, conversed with her, told her 11 that there was no conflict, and she chose never to raise it 12 formally. And I think that the attempt to make a major issue 13 of a conflict which is not even deemed significant enough or 14 deemed to have existed and formally raise it is improper in 15 this context. 16 Mr. Parker's argument went on at some length about 17 factual disputes with the allegations contained in the various 18 pleadings, discrepancies among the various pleadings and issues 19 of that nature. These external facts have no bearing on the 20 Court's determination as to whether or not the various 21 complaints as amended by the RICO statements state a cause of 22 action against Mar-Jac Poultry. 23 What the complaints do make clear, your Honor, is that 24 Mar-Jac Poultry is a part of the SAAR network. That's explicit 25 in every one of the complaints. Whether there are differences SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 21 56fWterC 1 of opinion or differences in the way that people describe the 2 relationship of the IIRO and Muslim World League to the SAAR 3 network is immaterial. Mar-Jac Poultry is plainly alleged to 4 be part of the SAAR network. 5 As the complaints and RICO statements further allege, 6 the SAAR network is alleged to have carried out serial 7 transactions between and among its members in an effort to 8 obfuscate the source and destination of funds, some of which 9 were ultimately transferred to Youseff Nada and Ahmed 10 Nasreddin, both of whom are specially designated global 11 terrorists. 12 Now, Mr. Parker pointed out that neither of those 13 individuals was designated prior to September 11. Again, 14 yesterday, some of the, again, your Honor, some of the comments 15 made yesterday applied in this context as well. Both 16 individuals were designated under Executive Order 13224, which 17 was passed on September 23, 2001, to fill a gap in America's 18 counterdesignation programs. 19 In essence, when September 11 happened, the government 20 realized that we needed a vehicle to sanction certain people 21 who were sponsoring groups like Al Qaeda. Nada was designated 22 almost immediately thereafter, in November of 2001, which 23 speaks to the amount of information that the government already 24 had about him. 25 Individuals who are associated with the SAAR network, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 22 56fWterC 1 are alleged to have been associates of Youseff Nada and Ahmed 2 Nasreddin. Their association with these individuals as well as 3 the character of the transactions that were carried out between 4 and among the SAAR network entities lead to a logical 5 conclusion that they are they were engaged in a knowing and 6 intentional attempt to launder money in support of terrorism. 7 You simply don't pass money through a series of transactions in 8 order to hand them over to someone like Youseff Nada and Ahmed 9 Nasreddin if you believe that those people are ultimately 10 innocent. 11 Now, as your Honor will recall, several of the other 12 defendants who are included in the SAAR network previously 13 moved to dismiss the complaints brought against them. Your 14 Honor addressed those arguments in the context of the Federal 15 Insurance complaint in the January decision. The Court 16 concluded that the allegations were sufficient to state a prima 17 facie case of personal jurisdiction against the SAAR network 18 entities, under both general jurisdiction and specific 19 jurisdiction theories. 20 As your Honor explained the burden relative to 21 sustaining a prima facie case of personal jurisdiction under 22 specific jurisdiction theories, the analysis focuses on whether 23 there are allegations that the defendants knowingly and 24 intentionally engaged in conduct giving rise to the plaintiffs' 25 injuries. Because the Court has already found that the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 23 56fWterC 1 allegations were sufficient to sustain that burden in the 2 Federal Insurance case against the SAAR network, the same 3 conclusion should be reached here. There's simply no reason to 4 depart from the logic. 5 Now, obviously, that particular analysis focused on 6 the 12(b)(2) motion to dismiss for lack of personal 7 jurisdiction. But under the specific jurisdiction theories 8 being advocated by plaintiffs, the analysis is, for practical 9 purposes, the same as should be employed by the Court under its 10 ruling to determine whether a claim has been stated upon which 11 relief can be granted. In essence, the focus is whether there 12 are allegations sufficient to establish the defendants' 13 participation in the conspiracy and aiding and abetting of Al 14 Qaeda or Al Qaeda fronts. 15 Mr. Parker went on at some length regarding the lack 16 of detail regarding the particular entities within the SAAR 17 network who transferred money to Youseff Nada and Ahmed 18 Nasreddin, the interrelatedness among the companies within the 19 SAAR network, and issues of that nature. Those are precisely 20 the issues that your Honor held should be elaborated upon 21 through jurisdictional discovery, and in that regard, the Court 22 directed the parties to engage in jurisdictional discovery 23 relative to those precise issues, which entities had engaged in 24 transactions with entities associated with Youseff Nada and 25 Ahmed Nasreddin and under what circumstances. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 24 56fWterC 1 Notably, your Honor, we served discovery seeking that 2 very information upon the SAAR network entities after your 3 Honor's decision. Unfortunately, that discovery has not gone 4 forward because those SAAR defendants advised us shortly 5 thereafter that they would be withdrawing their personal 6 jurisdiction defense and therefore regarded the personal 7 jurisdiction discovery to be moot. Their letter closed by 8 requesting that we contact them in order to set a briefing 9 schedule for their renewed motion to dismiss under 12(b)(6). 10 Frankly, I take issue with whether or not the Court's 11 order contemplated a renewed motion to dismiss under 12(b)(6) 12 in the absence of the jurisdictional discovery contemplated by 13 the order, but regardless, I think it's notable that the 14 jurisdictional discovery has not gone forward. 15 In any event, your Honor, as I mentioned before, the 16 analysis the Court employed in denying the SAAR defendant 17 motion to dismiss applies equally to Mar-Jac's motion to 18 dismiss under 12(b)(6). In fact, if anything, the allegations 19 set forth against Mar-Jac Poultry are more specific than those 20 presented against the other SAAR defendants. As an example, 21 the federal RICO statement explains the interrelatedness of the 22 Mar-Jac Poultry to the other entities within the SAAR network, 23 noting that the three principal officers of Mar-Jac were also 24 officers of dozens of other entities within the network. It 25 also identifies a specific transaction involving Mar-Jac SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 25 56fWterC 1 Poultry which bears hallmarks of money laundering in support of 2 terrorist activity. 3 We know, frankly, your Honor, quite a bit more than we 4 did at the time the pleadings were filed and the briefing 5 commenced. The briefing in Burnett is two years old; in 6 Federal Insurance, a year old. Since that time, through an 7 analysis of IRS form 990s filed by the members of the SAAR 8 network enjoying tax-exempt status, we know as an example that 9 Yaqub Mirza is an officer of some 17 entities within the SAAR 10 network, including Mar-Jac Poultry, and has signatory authority 11 over 27 different bank accounts with 15 different 12 organizations. Hisham Al Talib is an officer of 12 of those 13 entities, including Mar-Jac Poultry, and has signatory 14 authority over 21 different bank accounts associated with nine 15 SAAR network entities. In addition, we have information 16 indicating that Talib has been associated with entities 17 operated by Youseff Nada. Jamal Barzinji is an officer of some 18 11 SAAR network entities, including Mar-Jac, and holds 19 signatory authority over 18 different bank accounts. 20 While those additional details are significant, we 21 still don't have all of the relevant information, obviously, 22 because discovery has not commenced. But at this point, your 23 Honor, it seems that the appropriate course is to allow the 24 claims against the SAAR network defendants to proceed to 25 discovery so that we can vet some of these issues out, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 26 56fWterC 1 determine which entities were involved in transferring funds to 2 Nada and Nasreddin entities, and then further detail those 3 allegations in a Rule 12(b) statement. 4 At the outset of his argument, Mr. Parker noted that 5 Mar-Jac would be withdrawing the defense based on service in 6 Burnett. I would only note that there is also raised in the 7 Burnett motion to dismiss a personal jurisdiction defense. I 8 take it that because he didn't address it in detail in his 9 argument that it is also being waived at this point. In 10 fairness, I think that because Mar-Jac does acknowledge that it 11 has a physical presence in Georgia and its operations there, 12 there's little issue as to whether or not exercise of personal 13 jurisdiction is appropriate. 14 Thank you, your Honor. 15 THE COURT: Thank you, sir. 16 MR. KREINDLER: Your Honor, James Kreindler. 17 If you'll permit me one second, there's a comment I'd 18 like to make in response to something Mr. Parker said and I 19 think may be useful for the Court. Just take me one minute. 20 THE COURT: Go ahead. 21 MR. KREINDLER: Thank you, your Honor. 22 Your Honor, Mr. Parker and I have something in common. 23 We're both used to organizational structures and we understand 24 the notion of who is president, who is vice president, who 25 holds what position, in discrete organizations. When we began SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 27 56fWterC 1 this case, one of the challenges for us, being structured 2 people, was to cope with the situation very different from the 3 western business structures, legal structures that we're 4 familiar with. A theme in all the complaints is that there is 5 an overarching connection among major terror groups, Al Qaeda, 6 Hamas, Hezbollah, and that overarching structure has been 7 provided for many years by the Muslim Brotherhood, and that 8 while we're used to discrete organizations, where individuals 9 hold discrete positions in those organizations, what we're 10 dealing with in the 9/11 complaints is an Al Qaeda attack, but 11 it is also a Muslim Brotherhood attack on the United States. 12 And because it is a Muslim Brotherhood attack on the United 13 States, it implicates Palestinian terror groups, Hamas, 14 Hezbollah, groups that share antipathy towards Israel and what 15 they view as American sponsorship of Israel. 16 I wanted to make that comment because it is in that 17 light that we have tried to address organizations and groups 18 that interact in a way that at least for me was unfamiliar 19 prior to beginning these actions. 20 Thank you, your Honor. 21 MR. PARKER: Your Honor, if I may, a few comments I'm 22 not sure what to state in response to Mr. Kreindler's, I 23 assume, observation of his view of history or politics, but 24 whatever's alleged in these complaints -- 25 THE COURT: Do you deem it necessary? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 28 56fWterC 1 MR. PARKER: Well, no. I'll go on. 2 Mr. Carter did talk though about allegations that they 3 referenced in the RICO statement filed by the Federal 4 plaintiffs. And he mentioned a particular transaction. And I 5 want to read verbatim exactly what is stated about that 6 transaction, from page 4 of their, subparagraph F of their 7 statement: 8 "For example, in one transaction in 1998, SAAR network 9 entity Mar-Jac Poultry, Inc., 'donated' $1.1 million, which 10 represents 99 percent of the company's profits for that year, 11 to SAAR network entity African Muslim Agency, a purported 12 charity, which then transferred all but $35,000 of the money to 13 another SAAR network entity, York International, a shell 14 company located in the Isle of Man, which is famed for its bank 15 secrecy laws. At the time of these transfers, SAAR executive 16 defendant Yaqub Mirza served as an officer or director of all 17 three SAAR network entities. In other words, Mirza directed 18 Mar-Jac's profits through a series of other entities he also 19 controlled, until those funds ultimately reached a shell 20 company in the Isle of Man, where they could no longer be 21 tracked by federal authorities. These transactions bear all 22 the hallmarks of money laundering in support of terrorism." 23 That's the quote. There is no statement in this that 24 any monies from Mar-Jac went to Youseff Nada or Mr. Nasreddin. 25 I stated there is no pleading at all to that effect in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 29 56fWterC 1 complaints. For Mr. Carter to suggest otherwise wasn't a 2 mistake. 3 The movement of money from Mar-Jac to African Muslim 4 Agency to York International is not money laundering. The 5 money from Mar-Jac comes from the sale of chickens. Chickens 6 are legal items that can be sold. The proceeds from chickens 7 do not as a matter of law constitute proceeds from "specified 8 unlawful activity," which is otherwise required under 18 U.S.C. 9 1956. 10 Now, the only way movement of money internationally 11 could become a violation of 1956, assuming that money is 12 lawful, is if it were moved knowingly to support terrorist 13 activities. There is no allegation in this RICO statement or 14 in any complaint of any facts supporting any knowing movement 15 of any money internationally to any entity to support 16 terrorism, much less Al Qaeda or Osama Bin Laden. 17 The issue is not what they think they know now. The 18 issue is what they pled, the facts that they pled or, more 19 particularly, the failure to plead facts. Mar-Jac Poultry was 20 not before this Court in January. It is now before this Court. 21 The Court's January order was not directed against Mar-Jac 22 Poultry. I suggest that what Mr. Carter says the Court found 23 is a prima facie case is not what the Court found. 24 Due process, we suggest, respectfully, requires that 25 the plaintiffs' complaints as an abject failure of specificity SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 30 56fWterC 1 under Rule 8 should be dismissed as to all claims under Rule 2 12(b)(6), and we respectfully ask the Court to enter such an 3 order. 4 Thank you. 5 THE COURT: Mr. Parker, I might add, we didn't set out 6 this morning, as we did yesterday, have counsel agreed upon a 7 schedule and a time allotment? Or can someone speak to that, 8 if there's an agreed upon time allotted? 9 MR. PARKER: I think we're through, your Honor. 10 THE COURT: I assumed you were, but with your part of 11 the case. 12 Mr. Kreindler, is there an overarching time schedule? 13 MR. KREINDLER: Your Honor, we haven't fixed anything 14 specific, but I think we're probably about half done. 15 THE COURT: You're done on this first one, about an 16 hour a piece. These three, is that it? 17 MS. BIERSTEIN: Your Honor, Andrea Bierstein speaking. 18 The next group of arguments, there's three other 19 defendants. My understanding is they are being argued by a 20 single lawyer for the defendants. They are also going to be 21 responded to just by me, so I would expect -- 22 THE COURT: And you're known for your brevity, 23 Ms. Bierstein. 24 MS. BIERSTEIN: I'm going to be brief today. 25 THE COURT: Let's take a five-minute break. Then SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 31 56fWterC 1 we'll go on. 2 (Recess) 3 THE COURT: Please be seated. 4 Next counsel. 5 MR. HANANIA: Good morning, your Honor. Maher 6 Hanania, on behalf of Success Foundation. 7 THE COURT: Yes, sir. You may proceed. 8 MR. HANANIA: I also represent Dr. Abdulrahman 9 Alamoudi and Tariq Hamdi. 10 My arguments will be brief, your Honor. 11 We have filed motions to dismiss in all cases, and we 12 detailed legal and factual arguments. I will begin with the 13 Success Foundation, your Honor. 14 Success Foundation is a Commonwealth of Virginia 15 corporation. It ceased its operations approximately two years 16 ago. All of its computers and documents were seized by the FBI 17 during an investigation of Dr. Abdulrahman Alamoudi. Again, at 18 one point, Mr. Abdulrahman Alamoudi was a defendant, and he was 19 later dismissed in these cases. Success Foundation shared an 20 office with the American Muslim Foundation. They were also 21 associated with Dr. Abdulrahman Alamoudi, and that's how these 22 things are connected. Success -- 23 THE COURT: Is that down in Virginia, sir? 24 MR. HANANIA: Yes, your Honor. In northern Virginia. 25 And also Tariq Hamdi is a resident of northern SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 32 56fWterC 1 Virginia. The Success Foundation has also not renewed its 2 charter in the Commonwealth of Virginia. It has no assets, 3 and, as I stated before, its computers and all of its documents 4 as well as the American Muslim Foundation who shared an office 5 with them were confiscated by the FBI in relations to 6 Dr. Abdulrahman Alamoudi's investigation of his alleged, or his 7 unauthorized travel to Libya. 8 The allegations that were made by the plaintiffs in 9 these cases, your Honor, specifically with Success Foundation, 10 is that Success Foundation was sending money back and forth 11 between the IIRO and other Islamic relief, the Islamic 12 International Relief Organization and the American Muslim 13 Foundation. 14 Again, as I stated earlier, both of these 15 organizations were investigated by the FBI in northern Virginia 16 and found no wrongdoing whatsoever and no relation to anything 17 related to homeland security, national security, or terrorism. 18 The allegations that were made were blanket 19 allegations that these organizations were sending money back 20 and forth. Success as well as AMF are charitable organizations 21 which collected money and spent on charities such as legal 22 funds for Arab-Americans in the northern Virginia area and 23 clinics, to provide medical care for the needy of 24 Arab-Americans and Muslim Americans in the northern Virginia 25 area. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 33 56fWterC 1 Dr. Abdulrahman Alamoudi, who is presently 2 incarcerated, he pled guilty to unauthorized travel to Libya 3 and tax evasion. He was investigated by both the FBI, British 4 intelligence, as well as the Saudi intelligence, your Honor. 5 And he was interviewed by all three countries, and my firm and 6 other firms did represent him in his criminal matter, and none 7 of these three intelligence agencies found that Dr. Abdulrahman 8 Alamoudi was involved in any way in any kind of terrorist 9 activity relating to Al Qaeda, Hamas, or Hezbollah. 10 THE COURT: Did they make that statement? Those 11 agencies? 12 MR. HANANIA: Specifically, no, they did not make that 13 statement. 14 THE COURT: Then how can you make it? 15 MR. HANANIA: He -- I was, without having to divulge 16 confidential information, I was present at some of the 17 interviews that were conducted and his answers, if he was, your 18 Honor, he would have been definitely charged with these 19 activities. And he was not. 20 THE COURT: What you can share with us and what is 21 public is that he wasn't charged. Is that it? 22 MR. HANANIA: That's correct, your Honor. He's only 23 charged with unauthorized travel to Libya and tax evasion. 24 In the plaintiffs' complaint, they do allege that 25 Dr. Abdulrahman Alamoudi verbally stated in public that he SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 34 56fWterC 1 supports Hamas and Hezbollah. This was a statement that he 2 made once during a demonstration in front of the White House in 3 Washington, D.C., a few years back, but he was the first one to 4 come out and, during the tragedy of 9/11, and state that this 5 was a tragedy for all people, including Arab-Americans and 6 Muslim Americans, and that he condemned it in the strongest 7 terms. 8 His statement about Hamas that he later retracted, 9 your Honor, was a statement we believe that was made under his 10 First Amendment right to make such a statement during a 11 demonstration. Again, there's no linkage here between Hamas, 12 Hezbollah and Al Qaeda. So these blanket statements that were 13 made by the plaintiffs in this case against Dr. Alamoudi, by 14 specifically making a statement, they're saying that he's in 15 some way linked to the tragedy of 9/11, is unfounded. 16 The third individual, your Honor, is Tariq Hamdi. 17 Tariq Hamdi is a journalist who lives in northern Virginia, or 18 I should say used to live in northern Virginia. He has since 19 moved out of the country. I, for the past six and a half 20 months, have been unable to locate him. But we do continue to 21 represent him, your Honor. The allegations made in the 22 complaint is that he at one point interviewed Osama Bin Laden 23 or arranged for ABC News to meet with Osama Bin Laden. As a 24 journalist, he has done that, and other Arab-Americans have in 25 the past arranged for meetings for American news media with SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 35 56fWterC 1 other, with some Arab-American and Palestinian organizations. 2 For example, a very well known Palestinian in the Washington 3 area used to make arrangements years ago with the Palestinian 4 Liberation Organization, which was considered a terrorist 5 organization, with Yasser Arafat to meet with him whether in 6 Beirut or Tunis, but these are not crimes for a journalist to 7 arrange or an Arab individual to arrange meetings with the news 8 media and an Arab leader and so forth. 9 The allegation, again, the blanket allegation that 10 Tariq Hamdi delivered a battery pack for a cell phone to Osama 11 Bin Laden when he met with him, that this battery pack was 12 bought and sent to him, to his northern Virginia house, and 13 when he travelled to Pakistan and Afghanistan that he allegedly 14 gave this, but they do not specify when this took place, how it 15 took place, and if he actually delivered the battery or the, 16 the battery pack to Osama Bin Laden. 17 Again, in our motion to dismiss, we do point the Court 18 to that none of these factual allegations make any conclusions 19 or are specific in nature. Or, none of these, they do not, 20 they just basically make blanket allegations that such and such 21 things happened. They don't even rise to the level of there's 22 a conspiracy here or aiding and abetting in the 9/11 tragedy. 23 And basically, your Honor, the rest of our arguments 24 basically we would refer to the three motions to dismiss that 25 we have filed in this case. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 36 56fWterC 1 Thank you very much. 2 THE COURT: Thank you, sir, very much. 3 Ms. Bierstein, will you be responding? 4 MS. BIERSTEIN: Yes, I will, your Honor. 5 At the outset, I want to note the bulk of counsel's 6 comments are really directed at the truth of the allegations 7 against these three defendants, the Success Foundation, 8 Mr. Hamdi, and Mr. Alamoudi. And I'm sure the Court is well 9 aware that the truth of the allegations or whether we prove 10 them or whether Mr. Hanania believes there's evidence against 11 them is not at issue in this proceeding, but simply whether we 12 have stated a claim against these defendants. 13 Before turning to that, I do want to note that two of 14 the motions that are at issue here, the notices of motion said 15 that the motions were being brought under 12(b)(1), 12(b)(2), 16 and 12(b)(6), but the success of the motions on behalf of -- 17 just check. It's Mr. Hamdi and Mr. Abdulrahman Alamoudi, but 18 there were no arguments in the briefs, or today at argument, on 19 anything other than 12(b)(6). So we are assuming that they are 20 not pursuing motions for lack of subject matter jurisdiction or 21 lack of personal jurisdiction. 22 With respect to the Success Foundation, that brief did 23 contain an argument concerning personal jurisdiction. It was 24 not referenced today, and, as we've heard today, the Success 25 Foundation is headquartered, is or was when it was sued, then SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 37 56fWterC 1 headquartered in Virginia. And I'm therefore not going to 2 address my argument to the personal jurisdiction argument. I'm 3 assuming that that's also not being pursued, and I'm just going 4 to address the rest of my remarks to the -- 5 THE COURT: I'm not telling you what to address in 6 your argument, but counsel did say he was relying on his brief 7 as well. I don't know that it's fair for you to jump to any 8 conclusion, but go ahead. 9 MS. BIERSTEIN: Thank you, your Honor. 10 I'm going to start where Mr. Hanania left off, which 11 is Tariq Hamdi. And I think as was indicated a moment ago, the 12 allegations against Mr. Hamdi, the primary allegation relates 13 to the delivery of the battery for satellite telephone that 14 Osama Bin Laden is alleged to have used to coordinate 15 international terrorist attacks. 16 Now, in terms of the specificity with which this is 17 alleged in the complaint, paragraph 581 of the Burnett 18 complaint alleges that well after Osama Bin Laden had openly 19 declared war against Americans in 1996, Tariq Hamdi purchased 20 and arranged for the delivery of a battery for the satellite 21 phone. And then it describes the individual who had purchased 22 it and goes on to say "and that Osama Bin Laden used to 23 coordinate international terrorism." 24 There's, in the -- 25 THE COURT: What do you base that on? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 38 56fWterC 1 MS. BIERSTEIN: That's based, your Honor, on an 2 affidavit from, it's one of the officials of the United States 3 Customs Service, and at the moment, the name of the individual 4 is slipping my mind, but -- 5 THE COURT: Did he use the phone? Do you have the 6 number? 7 MS. BIERSTEIN: Your Honor, I think -- you're talking, 8 which allegation, you're talking -- 9 THE COURT: The phone. 10 MS. BIERSTEIN: That it was delivered by Mr. Hamdi, or 11 that Osama Bin Laden -- 12 THE COURT: No. The conclusion that he used that 13 phone for those purposes. 14 MS. BIERSTEIN: I think, your Honor -- I don't know 15 the basis for that allegation, but it is -- 16 THE COURT: Then why do you argue it? 17 MS. BIERSTEIN: Because it's alleged in the complaint, 18 your Honor. 19 THE COURT: Therefore, it's fair game? 20 MS. BIERSTEIN: Excuse me? 21 THE COURT: Therefore, it's fair game? 22 MS. BIERSTEIN: Therefore, it's a good faith 23 allegation, and the 12(b)(6) motion is addressed to whether we 24 have sufficiently alleged it. We will need to prove that at a 25 trial, your Honor, but in this context, whether we've SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 39 56fWterC 1 alleged -- 2 THE COURT: Whether you have any basis for it, it's 3 inappropriate at this time? 4 MS. BIERSTEIN: No, your Honor. I think I stand 5 behind what Mr. Carter said. Our understanding is that all of 6 the attorneys have an obligation to include only allegations in 7 this complaint for which we have a good faith basis. 8 THE COURT: And I asked you how do you know that. 9 MS. BIERSTEIN: Your Honor, I don't know what the good 10 faith basis for this particular allegation was. 11 The complaint, as I said, I've seen the affidavit of 12 the government official who we base this allegation on, but I 13 have to tell you, the complaint is 500 pages long. And if you 14 ask me to provide you within some reasonable amount of time 15 what the good faith basis for that allegation was, I would be 16 happy to do that. But the idea that I could memorize -- 17 THE COURT: Whoa, whoa, whoa. You recognize the 18 signal. We used it last time. Turn off the motor. 19 Go on with your argument. 20 MS. BIERSTEIN: Your Honor, the allegations against 21 Mr. Hamdi are sufficient to state claims under the 22 Antiterrorism Act, the Alien Tort Claims Act, and the common 23 law, and I just want to note that the Antiterrorism Act 24 specifically prohibits the knowing provision -- 25 THE COURT: Ma'am, slow down. The reporter just asked SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 40 56fWterC 1 you. Do you have this written out? Are you just reading? 2 MS. BIERSTEIN: I'm not just reading, your Honor. I 3 have notes, but I'm skipping around. 4 THE COURT: Please, when I tell you to stop, stop. 5 You just -- that motor gets going, and I'm trying to stop you. 6 All right? 7 Fine. Continue. 8 MS. BIERSTEIN: Your Honor, the Antiterrorism Act 9 specifically prohibits the knowing provision of communications 10 equipment to a foreign terrorist organization. That's in 11 Sections -- 18 U.S.C. Sections 2339(a) and 2339(b). Now, I 12 note that's precisely what Mr. Hamdi is alleged to have done, 13 to have provided the equipment necessary to operate a satellite 14 telephone to Al Qaeda at a time when Al Qaeda had publicly 15 announced its terrorist agenda. 16 And your Honor has already recognized in the Court's 17 January 18 order, and I think this goes directly back to the 18 question you raised just a moment ago, that the material 19 support need not, under the ATA, have been used specifically in 20 the September 11 attacks. So whether or not Osama Bin Laden 21 used this particular satellite phone to coordinate any 22 particular attack, it is sufficient to state a claim that 23 Mr. Hamdi provided him with a battery pack to operate a 24 satellite telephone, that Mr. Bin Laden was operating a 25 terrorist organization, and that it was known at the time that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 41 56fWterC 1 he was doing that. That, your Honor, is all of the elements of 2 the claim, and that means the complaint is sufficient to state 3 a claim under that statute. 4 I want to turn now for a moment to Mr. Hamdi's motion 5 to dismiss the RICO allegations in the Federal Insurance 6 complaint, and I want to note that the Federal Insurance 7 plaintiffs have pled violations of two sections of the RICO 8 statute. This would be at 18 U.S.C. 1962(c) and 1962(d). I 9 just want to note, in terms of any RICO standing issue, that 10 these plaintiffs are insurance companies that have paid out 11 money on claims, and they've clearly been injured in their 12 business or property. 13 The RICO statement applicable to Mr. Hamdi lists eight 14 predicate acts and the statutes applicable to each one. It 15 defines the enterprise. It provides a description of the 16 enterprise and describes Mr. Hamdi's involvement. 17 Now, I just want to note, Mr. Hamdi contends that 18 whatever role he played, it was as an independent contractor 19 and that in no way undercuts the allegations. But the point 20 that I want to get to, your Honor, is that the plaintiffs are 21 not required, in order to maintain their RICO claims, to plead 22 or to prove that Mr. Hamdi was a central figure or actually had 23 a part in directing the enterprise. 24 Although plaintiffs are required to allege that the 25 defendant had a role in the operation or management of the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 42 56fWterC 1 enterprise, the Second Circuit has made clear that the 2 requisite discretionary authority is, and I'm going to quote, 3 "a relatively low hurdle for plaintiffs to clear." 4 I'm going to give you the case citation for that. I 5 have written out the case citations, and I'll hand them up to 6 you afterwards; I didn't want to do it ahead of time because I 7 wasn't sure which things I was going to use and which not. 8 The quote involving the relatively low hurdle for 9 plaintiffs to clear is from First Capital Asset Management v. 10 Satinwood. That's at 385 F.3d 159. That's the Second Circuit 11 in 2004. That case cites and relies on some earlier Second 12 Circuit cases, dealing with the same issue; that is, the degree 13 of authority and control that a defendant must be alleged to 14 have in a RICO enterprise. Those cases are Baisch v. Gallina, 15 356 F.3d 366 (2d Cir. 2003); DeFalco v. Bernas, 244 F.3d 286 16 (2d Cir. 2001; and at United States v. Allen, 155 F.3d 35 (2d 17 Cir. 1998." 18 And I want to note that in Baisch, the Second Circuit 19 found that the defendant had sufficient discretionary authority 20 when he recruited financing, obtained bonds and insurance 21 coverage, concealed deceptive practices and represented others 22 in meetings. That is, you don't need to have an official 23 position running the organization if you can operate 24 independently with any discretionary authority of your own. 25 That's what you need to show for Section 1962(c). So SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 43 56fWterC 1 it would be enough that Mr. Hamdi operated independently using 2 his own discretion, even if he was not at the highest planning 3 levels of radical Islamic terrorism. But the standard is even 4 lower for Section 1962(d). And indeed, in Baisch, the Second 5 Circuit specifically stated, and this is, "The requirements for 6 RICO conspiracy charges under Section 1962(d) are less 7 demanding, and all that is required here is that the 8 conspirator," and again I'm going to quote 'intend to further 9 an endeavor, which, if completed, would satisfy all the 10 elements of the substantive criminal offense.' But it suffices 11 if he adopted the goal of furthering or facilitating the 12 criminal endeavor." 13 So he doesn't need to have been a central figure in 14 the enterprise in order to be found liable for conspiring to 15 conduct the activities of that enterprise through a pattern of 16 racketeering activity. And so I submit that under the Second 17 Circuit standard, and this argument is equally applicable to 18 Mr. Alamoudi, that, who has also moved to dismiss the RICO 19 claim, that the allegations are sufficient to establish both 20 the RICO conspiracy claim against them and the violation of 21 Section 1962(c). 22 I want to turn now to the Success Foundation and 23 Mr. Alamoudi, who I will discuss together, to some extent, 24 because, as we've alleged in the complaint, Mr. Alamoudi was 25 the secretary of the Success Foundation. So I'm going to turn SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 44 56fWterC 1 first to Success. 2 Success, the Burnett plaintiffs have alleged that 3 Success is an affiliate of the IIRO. We've talked a lot about 4 the IIRO yesterday. I'm not going to go back over that. 5 Success is also alleged to have sent money back and forth with 6 IIRO and to send money to other organizations that sponsor 7 terrorism. I think that this is probably a good time to clear 8 up something that came up to some extent in the last argument, 9 which is about the definition of money laundering and all these 10 transactions back and forth between organizations. 11 Conventionally, it used to be money laundering, you 12 took the money from the criminal activity, and you put it into 13 something that would make it come out as legitimate money. You 14 put it into a business and basically took the dirty money, put 15 it in the washing machine, and it came out clean. And that's 16 why we called it money laundering. What we typically have seen 17 with terrorists, you take the clean money, you generate it in 18 some clean ways, swap it around in enough places until it gets 19 lost, and divert it to the terrorists and make it dirty. 20 Maybe laundering is not the best term there because 21 you're taking the clean and making it dirty. If you had your 22 washing machine do that you'd probably throw it out. 23 But I think the government has recognized, and it's 24 pretty plain, that these involved the same kinds of problems 25 that you're using numerous ways of obfuscating, confusing SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 45 56fWterC 1 financial transactions to obscure the money trail, and whether 2 it's to make the clean money dirty or the dirty money clean, 3 you've got the same problem. And so when Success is alleged to 4 have been sending money back and forth in a series of 5 cancelling or complicating transactions, what we're talking 6 about is obscuring a money trail that is, in the vernacular, 7 referred to as money laundering. 8 I think that when you read the allegations about 9 Success' relationship to IIRO and the money transactions, in 10 the context of the allegations concerning IIRO, that the 11 allegations against Success state a claim under the 12 Antiterrorism Act and under the common law. 13 But I want to note, your Honor, that if you don't 14 agree with us, we would respectfully ask for leave to replead 15 because if leave to replead is given, we would add numerous 16 additional allegations. I want to summarize quickly what else 17 we would allege, just to provide a basis that this is not just 18 a knee jerk, give us another chance, where it would be futile. 19 We actually have gained lots of additional information since 20 the time this complaint was written. 21 Among the things that we would allege, if we were 22 given leave to replead, is that in 1998, Success entered into 23 an agreement to act as the agent for Taibah Charitable 24 Foundation, otherwise known as Taibah International Aid 25 Association, or TIAA, an affiliate of the SAAR network. The SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 46 56fWterC 1 document -- that is, the agreement itself -- states that Taibah 2 will act as Success' agent in executing its internal projects. 3 In 2004, Taibah was designated by the U.S. Government 4 as a global terrorist entity. Taibah's application for tax 5 exemption, back when it was founded in 1991, lists Abdullah Bin 6 Laden, Osama's nephew, as a founding director. A signature 7 card for TIAA shows that in 2000, Abdullah Bin Laden at that 8 time was still a director of it and had signatory authority 9 over its bank accounts. And it also, TIAA and Success share an 10 address in Falls Church, Virginia. And the relationship 11 between Success and TIAA is particularly significant because 12 the Burnett plaintiffs have made numerous specific allegations 13 about TIAA's support of Al Qaeda. Those are in paragraphs 296 14 through 308 of the Burnett third amended complaint. 15 The agreement between Success and TIAA now establishes 16 that, or whether it establishes, it can lead to an inference 17 that, and allows us to allege that in carrying out its support 18 of Al Qaeda, TIAA was authorized to act as Success' agent. 19 We would also add allegations about specific financial 20 transactions, specific checks, that Success wrote to TIAA, and 21 the fact that Success used the same bank account to send tens 22 of thousands of dollars to other specially designated global 23 terrorist entities around the world. Receipts found at 24 Success' offices in Virginia document a large transfer of money 25 between Success and an entity known as IHH, which a judge in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 47 56fWterC 1 France has found to be closely linked to the Millennium bomber. 2 Plaintiffs believe that Success is, in fact, the IIRO's United 3 States branch, and receipts for contributions made by IIRO that 4 were found in Success' offices would provide additional 5 evidence that this is the case. 6 So we believe that even if we haven't stated a claim, 7 and we think that we have, that these new allegations would 8 more than sufficiently establish Success' role in knowingly 9 providing assistance to Al Qaeda. 10 Lastly, with respect to Mr. Abdulrahman Alamoudi, 11 Mr. Abdulrahman Alamoudi was the secretary of Success. He's 12 alleged to have used his control of Success to funnel money to 13 Al Qaeda. He's connected to many of the other entities that 14 have been discussed at previous hearings. According to his own 15 resume, he was executive assistant to the president of the SAAR 16 Foundation. He's an officer of TIAA, the organization I just 17 mentioned a moment ago. And he's used a third entity called 18 the Happy Hearts Trust to funnel money to Al Qaeda. Those 19 allegations, your Honor, are in the Federal complaint at 20 paragraphs 244 to 247. 21 So basically, Mr. Abdulrahman Alamoudi is alleged to 22 have held leadership positions with three separate groups 23 linked to Al Qaeda financing, Success, Taibah and SAAR. And we 24 would argue, your Honor, that while it might be plausible for 25 Mr. Abdulrahman Alamoudi to be an officer of one organization SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 48 56fWterC 1 that was supporting Al Qaeda and not know that that's what that 2 organization was doing, his positions with three separate 3 entities, all of whom were raising money for Al Qaeda, 4 certainly gives rise to an inference that he knew what those 5 groups were doing. 6 And I think that we've discussed already today the 7 SAAR entities, which we've alleged to be a sophisticated 8 arrangement of nonprofit and for-profit organizations that 9 served as front groups for extremist Islamic terrorist 10 organizations. Mr. Alamoudi's position there as executive 11 assistant to the president, I think the Court can infer, 12 reading the complaint, giving all of the, giving the plaintiffs 13 the benefit of reasonable inferences to be drawn, that 14 Mr. Abdulrahman Alamoudi was working closely with the president 15 of SAAR. And the allegation that he used various entities that 16 he was affiliated with to funnel money to Al Qaeda sufficiently 17 states a claim that Mr. Abdulrahman Alamoudi provided material 18 support to Al Qaeda and subjects him to liability. And I just 19 want to make one quick point about that. 20 In the context of some of the other defendants, we 21 have talked about this interesting question of whether a 22 particular defendant knew when he gave money to a charity that 23 the money would be diverted to Al Qaeda, and I want to note 24 that we don't have that issue here. We're really in the 25 opposite situation. We've alleged that Mr. Abdulrahman SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 49 56fWterC 1 Alamoudi was one of the people doing the diverting. He's the 2 guy at these entities that we're alleging was doing the 3 diverting. He was using these entities to funnel money. And, 4 again, as with Mr. Hamdi, we don't need to allege that the 5 money that he funneled, that he funneled to Al Qaeda, was used 6 specifically in the September 11 attacks. 7 The RICO argument is the same as with Mr. Hamdi; I'm 8 not going to run through it again, your Honor. We think that 9 the Federal plaintiffs have stated that claim. 10 As with Success, if your Honor were to find that these 11 allegations against Mr. Abdulrahman Alamoudi were insufficient, 12 we also again seek leave to replead because we do have 13 additional allegations that we would make about him. Some of 14 these would involve -- well, some of them involve the 15 additional allegations against Success, which, given 16 Mr. Abdulrahman Alamoudi's ties to Success, also now tie him to 17 Taibah, as well as allegations pertaining to his arrest and 18 conviction in the United States for tax, immigration, and 19 terrorism-related offenses. 20 I want to note, your Honor, one of my cocounsel has 21 handed me a note, with respect to the satellite phone battery 22 issue with Mr. Hamdi. In the 1998 embassy bombing trial here, 23 in the Southern District, on day 37 of the trial, this was in 24 May 2001, there were testimony, exhibits and argument by then 25 Assistant U.S. Attorney Patrick Fitzgerald, and all the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 50 56fWterC 1 defendants at that trial were convicted, including Osama Bin 2 Laden, in absentia. And apparently on that day at the trial 3 that's where testimony and evidence was presented concerning 4 the provision of the satellite battery to Osama Bin Laden. And 5 I understand from my cocounsel at Motley Rice who were involved 6 in drafting the complaint that that provides the good faith 7 basis for those allegations. 8 Unless your Honor has questions, that concludes my 9 argument. 10 THE COURT: Thank you, ma'am. 11 MR. HANANIA: May I have two minutes, your Honor, to 12 respond. 13 THE COURT: You may. 14 MR. HANANIA: Your Honor, the allegations made against 15 Mr. Hamdi, counsel has stated in paragraph 581 of the Burnett, 16 it states: "Tariq Hamdi purchased and arranged for the 17 delivery of a battery for satellite phone that Ziyad Khaleel 18 purchased and that Osama Bin Laden used to coordinate 19 international terrorism attack." 20 This is what they allege in paragraph 581. So, later 21 in their allegations, your Honor, they state that the battery 22 was delivered to Tariq Hamdi's home in Herndon, Virginia, which 23 he did not purchase it but he took with him on his trip and 24 gave it to Osama Bin Laden; he acted as a delivery person. So 25 we're not quite clear what the plaintiffs are alleging here, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 51 56fWterC 1 No. 1. 2 No. 2, whether the battery actually worked or not, and 3 No. 3, he was investigated by the FBI on numerous times, your 4 Honor, not once or twice, the FBI, and they found that he did 5 nothing wrong, and he continued to practice his journalism in 6 the United States and abroad. 7 The issue of the Success Foundation, your Honor, 8 Dr. Abdulrahman Alamoudi only volunteered for Success 9 Foundation. He was not an officer of that company. And 10 nowhere in the plaintiffs' allegations in the complaint does it 11 state that the money was used by Success to transfer to other 12 organizations or was used by Al Qaeda or any international 13 terror groups. They specifically state that this money was 14 transferred from one organization to the next. 15 Furthermore, counsel stated that in 1998, Success 16 entered into an agreement with Taibah foundation, but that was 17 never pled in their complaint, if they had this information in 18 1998 or thereafter since the letter stated that they entered 19 into the agreement in 1998. 20 And again, we would respectfully oppose it, and 21 there's no basis for them to enter or to file or to replead any 22 of these newly found evidence. If there had been any new 23 evidence, your Honor, I believe the basis would be for them to 24 dismiss these allegations and to file a new complaint against 25 the defendants. But I think this case has gone on far enough, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 52 56fWterC 1 and expenses that are being paid by our clients or lack of 2 expenses being paid by our clients to our firm should also be 3 taken into consideration in these continually repleading every 4 time they've learned new evidence. 5 As far as the Alamoudi is concerned, your Honor, 6 again, for what it's worth, he was investigated numerous times. 7 It was never found that he was involved in any way in any money 8 laundering. He did bring money into the United States, not 9 take money out of the United States. Most of the money that 10 Dr. Abdulrahman Alamoudi brought into the U.S. is to be used 11 for charity in the United States. Success Foundation only 12 spent money inside the United States. When they transferred 13 money outside to other organizations, it was to be used for 14 charity, and this is their understanding of it. And again, in 15 the complaint, they do not allege that any of this money was 16 used by Al Qaeda. 17 Thank you. 18 THE COURT: Thank you, sir. 19 MR. KREINDLER: Your Honor, I think that's it for the 20 motions this morning. 21 THE COURT: Okay. All right, good people. I thank 22 you all very much. Court will stand in recess. 23 o0o 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300