Customers use ATMs inside the Al Rajhi Bank in Riyadh, Saudi Arabia. Photo: Simon Dawson/Bloomberg

The U.S. Court of Appeals for the Second Circuit on Tuesday revived a civil lawsuit accusing Saudi Arabian Al Rajhi Bank of aiding al-Qaida in carrying out the Sept. 11, 2001, terrorist attacks, and directed a lower court to conduct discovery on whether it has jurisdiction to hear the claims.

The ruling, outlined in a summary order by a three-judge panel of the Manhattan-based appeals court, came as part of a long-running multidistrict litigation in the U.S. District Court for the Southern District of New York to hold Saudi Arabia, its agents and largest Islamic bank liable for the attacks, which killed 3,000 people in New York, Pennsylvania and Washington, D.C.

U.S. District Judge George Daniels last year allowed discovery to proceed against the country, but dismissed claims against Al Rajhi and refused the plaintiff's request for jurisdictional discovery.

A host of individuals and U.S. businesses argued that the district court had jurisdiction over their claims because Al Rajhi had either provided financial support to al-Qaida or engaged in a conspiracy to target U.S. interests. According to the suit, the bank funneled money and other aid to groups that it knew provided financial support to al-Qaida and extremist operatives.

Previous lawsuits against Saudi officials had failed to establish personal jurisdiction because the Second Circuit found that allegations of indirect funding were not enough to establish "intentional conduct" aimed at U.S. residents.

The panel, however, said allegations of Al Rajhi's "specific intent" to further al-Qaida's attacks distinguished the case from those efforts and ordered Daniels to begin discovery of the jurisdictional issues at play.

"Construing all reasonable inferences in favor of the plaintiffs-appellants, the support alleged here, in conjunction with this specific intent, we believe is 'more direct and one step closer to al Qaeda' when compared to the support we have previously found inadequate," the order said.

According to the ruling, discovery would involve what kind of alleged support may have been provided, whether it had been earmarked for certain purposes and how specifically Al Rajhi was "involved in the process of providing support to al Qaeda."

Sean Carter, co-chair of the plaintiffs executive committee, said the ruling was an "important step" toward ultimately holding the bank responsible for its role in the attacks.

"Since 2003, we've been pursuing these claims to get answers concerning any Saudi involvement in the rise of al-Qaida and the involvement of the Saudi government," said Carter, a member of Cozen O'Connor in Philadelphia.

"This is the first time we've ever had a chance to conduct discovery of Al Rajhi," he said.

Christopher Curran, a partner with White & Case who is representing the bank, did not immediately return a call Tuesday afternoon seeking comment on the ruling.

The case is captioned In re Terrorist Attacks on Sept. 11, 2001.

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