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NEW YORK (Reuters) - More than a decade after a series of shootings and bombings in the Jerusalem area, a trial is slated this week in New York to determine whether the Palestine Liberation Organization and Palestinian Authority should pay up to $1 billion to victims.
Jury selection begins on Jan. 13 for the civil trial, which is expected to last 12 weeks and adds a new dimension to the long-running Middle East conflict and tensions among Palestinians, Israel and their respective allies.
"The political considerations are extremely complex," said Bruce Zagaris, a partner at Berliner, Corcoran & Rowe in Washington, D.C., specializing in international law.
The case concerns seven shootings and bombings from 2001 to 2004 that killed 33 people and wounded more than 450.
Victims and their families claim that the defendants helped carry out and finance the attacks, in part through support for Hamas and the al-Aqsa Martyrs Brigades, which the U.S. government has labeled terrorist organizations.
The PLO and the self-governing Palestinian Authority have denied the claims, including that they violated the U.S. Anti-Terrorism Act.
Mark Rochon, a partner at Miller & Chevalier representing the defendants, through a spokeswoman declined to comment. Kent Yalowitz, a partner at Arnold & Porter representing the plaintiffs, was unavailable to comment.
U.S. District Judge George Daniels in Manhattan will oversee the trial. Last September, a federal jury in Brooklyn found Arab Bank Plc liable under the anti-terrorism law for having provided material support to Hamas.
Palestinians wish to form a state in Gaza, the West Bank and East Jerusalem, lands Israel captured in the 1967 Arab-Israeli war. In recent years they have taken steps to add powers or prerogatives enjoyed by many sovereign nations.
Palestine has since 2012 been a United Nations "observer state," and Palestinians this month moved to join the treaty that created the International Criminal Court, a step that could lead to probes of alleged Israeli crimes on Palestinian lands.
Last month, Judge Daniels rejected the PLO's bid to throw out the lawsuit seeking $1 billion - a sum the plaintiffs want tripled - on the ground that he lacked jurisdiction.
He distinguished the case from last January's U.S. Supreme Court decision that German automaker Daimler AG could not be sued in California over alleged illegal conduct outside the country merely because it had a subsidiary in the state.
Peter Margulies, a professor at Roger Williams University School of Law in Bristol, Rhode Island, said Daniels may have been "too hasty," given that higher courts might ultimately extend the Daimler reasoning to organizations such as the PLO.
"You don't want everyone in the world to be hauled into court when the contacts may be thin," he said. "That's a plausible reading of what the Supreme Court said."
Another issue is that if it loses, the PLO could drag out appeals for years, or be unable to pay a big judgment to begin with.
Indeed, Israeli Prime Minister Benjamin Netanyahu decided to withhold critical tax revenue from the Palestinian Authority following the ICC move.
"The Palestinians are broke," said Zagaris.
Plaintiffs in similar prior cases, including against Iran, have also struggled to recover big awards because the defendants have few or no U.S. assets, and "most foreign jurisdictions will not enforce these types of U.S. judgments," he said.
The plaintiffs say the Palestinians have plenty of money to pay any judgment.
The case is Sokolow v. Palestine Liberation Organization et al, U.S. District Court, Southern District of New York, No. 04-00397.
Reporting by Jonathan Stempel in New York; Editing by Dan Grebler