A cloud of smoke rises at Ground Zero in New York City on September 17, 2001, less than one week after the attacks. A federal judge ruled Wednesday a lawsuit against Saudi Arabia in the case may proceed. File Photo by Chris Corder/UPI | License Photo

March 29 (UPI) -- A federal judge on Wednesday rejected the Saudi Arabian government's attempt to dismiss a lawsuit accusing it of financing al-Qaida and sponsoring the Sept. 11 attacks.

The lawsuit demands Saudi Arabia pays billions of dollars in damages to the families of 3,000 people who died in the attacks. The Saudis filed a motion to dismiss, arguing that U.S. courts lack jurisdiction over their alleged actions overseas.


But U.S. District Judge George Daniels in Manhattan ruled that the lawsuit may proceed, citing the 2016 Justice Against Sponsors of Terrorism Act, which Congress passed by overruling a veto by President Barack Obama, who opposed the law because of the possibility U.S. troops and other government entities could be exposed to lawsuits in other nations.

Daniels also based his ruling on the plaintiffs' deposition of Zacarias Moussaoui, an al-Qaida operative currently serving six life sentences in U.S. federal prison for his role in the 2001 attacks.

"According to Plaintiffs, Moussaoui's testimony establishes new facts showing that the Moving Defendants aided Osama bin Laden and al Qaeda by providing funds and other forms of material support in furtherance of the 9/11 Attacks," Daniels wrote.

In addition, Daniels said the plaintiffs may obtain discovery evidence regarding allegations that two Saudi government agents in California provided assistance to several of the hijackers.

"We are very pleased to report that Judge Daniels denied Saudi Arabia's motion to dismiss and ruled that the plaintiffs may conduct limited jurisdictional discovery of the Kingdom," attorney Jim Kreindler, who is representing the victims' families, said in a statement.

Although Daniels allowed the lawsuit to proceed, he threw out the plaintiffs' allegations that three Saudi banks should be included in the complaint for transferring funds to aid the perpetrators of the attacks, citing lack of jurisdiction.

The lawsuit against Saudi Arabia was filed last May on behalf of the families of 850 people who were killed in the attacks, and another 1,500 who were injured.

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