Supreme Court Denies Stay of $655.5 Million Judgment Against Palestinian Authority

On Monday, Justice Sonia Sotomayor refused to grant an emergency stay that would have paused enforcement of a $655.5 million judgment against the Palestinian Authority (PA) and the Palestine Liberation Organization (PLO). The order addressed only the stay request and did not resolve the underlying legal dispute.

Newsweek

The judgment originates from lawsuits filed by American victims of terrorist attacks in Jerusalem between 2002 and 2004, during the Second Intifada. Plaintiffs sued the PA and PLO under the U.S. Anti-Terrorism Act. After a 2015 trial, a New York federal court issued the judgment; the 2nd U.S. Circuit Court of Appeals vacated it in 2016, citing lack of jurisdiction, and the Supreme Court declined to hear an appeal at that time.

Newsweek

Congress responded in 2019 with the Promoting Security and Justice for Victims of Terrorism Act (PSJVTA), expanding jurisdiction over foreign entities. The Supreme Court unanimously upheld the PSJVTA in the 2025 case *Fuld v. Palestine Liberation Organization*, prompting the 2nd Circuit to reinstate the $655.5 million judgment in 2026.

Newsweek

The PA’s primary source of funding—Israeli-collected clearance revenues, taxes and customs duties—has been suspended since 2025, deepening a fiscal crisis. A World Bank report described the PA as being in “deep fiscal crisis,” noting a deficit of roughly $605 million in the first nine months of 2025 before external grants. The legal setback arrives as the PA confronts mounting financial pressure following Hamas’ October 7, 2023 attack on Israel and the ensuing Gaza war. Attorneys for the PA and PLO warned that immediate enforcement would destabilize essential services such as security, sanitation and education in the West Bank and could jeopardize regional security.

Newsweek

The PA and PLO filed the emergency stay in late July, arguing that the judgment had become “a nullity” and “absolutely void” after earlier proceedings and emphasizing the potential harm to innocent citizens. Plaintiffs’ counsel declined to comment on the Supreme Court’s order. Legal scholar Eugene Kontorovich noted that while enforcement in the United States is difficult because the PLO holds limited assets there, a U.S. judgment can be pursued abroad, including in Israel.

Newsweek

The jurisdictional dispute remains unresolved, and the parties may continue to pursue appeals. Enforcement could target the PA’s remaining revenue streams, but the practical mechanisms for collection remain uncertain.

Newsweek