A landmark ruling in a New York court allows Israeli terror victims of Hizbullah attacks to sue the NY branch of a Lebanese bank.

A landmark ruling in a New York court allows Israeli terror victims of Hizbullah missile attacks in 2006 to sue the New York branch of a Lebanese bank for handling millions of dollars of transfers.

The lawsuit was filed by American, Canadian and Israeli citizens who suffered injuries and property damage in the attack during the Second Lebanon War.

The suit alleges that the Lebanese Canadian Bank (LCB) supported terrorism by handling international financial transactions of the Hizbullah affiliate Shahid Foundation. The funds allegedly were moved through an account at American Express Bank in New York.

The suit was dismissed in 2010 on the basis that using an American Express account to wire funds to Hizbullah was not necessarily directly connected to the terrorist assault.

A six-member panel on the Court of Appeals agreed with the plaintiffs that the now-defunct bank can be sued under the state’s civil laws.

Judge Susan Read wrote, "While it may be that LCB could have routed the dollar transactions on behalf of Shahid elsewhere, the fact that LCB used a New York account 'dozens' of times indicates desirability and lack of coincidence.

"Presumably, using the AmEx account was cheaper and easier for LCB than other options, and whatever financial and other benefits LCB enjoyed as a result allowed the bank to retain Shahid as a customer and to support its allegedly terrorist activities and programs."

Israel Law Center lawyers said the case will return to a federal Circuit Court of Appeals and that it is especially significant because of the missile and rocket attacks on southern Israel from Hamas and other terrorists in Gaza, under control of Hamas.

The United States has ruled that Hamas is an illegal terrorist organization.

The New York state ruling “opens up American jurisdiction for banks that think they're hiding in lawless countries and they can continue and support the terrorism,” said Nitsana Darshan-Leitner, director of the Israel Law Center.