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April 29, 2014

Case Against Rajaratnam: U.S. District Judge rules civil litigation involving alleged financial support to LTTE may proceed

On Monday, April 28, 2014, in one of the few cases interpreting the Alien Tort Statute (ATS) post the Supreme Court’s ruling in Kiobel v. Royal Dutch Shell Petroleum, U.S. District Judge Jose Linares denied motions to dismiss filed by Defendants concerning the extraterritorial reach of the ATS in Krishanti, et al., v. Rajaratnam, et al.

The civil litigation concerns the Sri Lankan-born American citizen and founder of the hedge fund management firm Galleon Group, Rajakumara “Raj” Rajaratnam, and his father J.M. Rajaratnam’s alleged role in knowingly and purposefully providing millions of dollars to the Liberation Tigers of Tamil Elam (LTTE) terrorist group.

In Monday’s ruling, the Court held that “Plaintiffs are…suing the Rajaratnam Defendants for their alleged actions that occurred within the United States….This makes the present case distinguishable from Kiobel, . . . , where all of the alleged illegal conduct occurred in foreign forums.” “Further, the Rajaratnam Defendants are United States citizens, and therefore, . . .this is not a case ‘where a foreign national is being hailed into an unfamiliar court to defend himself.’ ”

“We are pleased to be able to move forward with this case,” stated Motley Rice member and anti-terrorism attorney Michael Elsner. “This ruling is promising for the LTTE victims and their families who have waited for years in hopes that the Rajaratnams may one day be held financially accountable for the horrific terrorist activity they allegedly funded.”

Judge Linares did grant the Tamil Rehabilitation Organization’s (TRO) motion to dismiss for lack of personal jurisdiction in New Jersey without prejudice and gave the Plaintiffs until June 13, 2014, to file an amended complaint against the TRO if they choose to do so.

On Oct. 22, 2009, Motley Rice, with co-counsel Lite DePalma Greenberg, LLC, of Newark, N.J., filed the complaint against Rajaratnam, his father and the TRO on behalf of more than 30 victims and survivors of the terrorist group’s attacks, alleging that they knowingly provided financial and other support to the LTTE. The complaint was the result of a year-long investigation and was filed under the Alien Tort Claims Act of 1789, which grants non-U.S. citizens access to the U.S. Courts to seek justice for violations of “the law of nations,” such as crimes against humanity. 

From 2004 through 2009, LTTE conducted hundreds of attacks, including several suicide bombings directed at civilians. According to the FBI, LTTE is responsible for the murders of more than 4,000 people since 2006. Plaintiffs also alleged Rajaratnam and the Rajaratnam Family Foundation donated more than $5 million to the LTTE through the TRO. Between 2001 and 2007, the U.S. Department of Treasury designated the TRO as a “charitable organization that acts as a front to facilitate fundraising and procurement for the LTTE.”

Read more about the litigation.