The US Senate has passed a bill that would allow families of victims of the 9/11 attacks to sue Saudi Arabia, even as the White House said President Barack Obama would veto the legislation.
Saudi Arabia has reportedly threatened to withdraw its $750-billion worth of investments in America if it became law.
While the bill still needs to be passed by the House of Representatives before it lands on the President's desk for Obama to sign it into law, the White House has said that Obama would veto it.
"This legislation would change longstanding international law regarding sovereign immunity," White House Press Secretary Josh Earnest said on Tuesday after the Senate passed the Justice Against Sponsors of Terrorism Act (JASTA).
"The President of the United States continues to harbour serious concerns that this legislation would make the United States vulnerable in other court systems around the world.
"Given the concerns that we have expressed, it's difficult to imagine the President signing this legislation. That continues to be true," he said in response to a question.
Earnest said there is also a concern that hasn't gotten as much attention about the potential vulnerability that is created for some of US allies and partners in US courts.
"The concern is related to the fact that sovereign immunity is a principle that is critical to our national security. The United States is more engaged in activities in other countries than any other country in the world," he said.
"Typically, those are actually activities that other countries benefit from significantly. These are peacekeeping activities, or humanitarian relief activities, or other activities in which the United States is supporting the national security activities of other countries, and the national security of other countries is enhanced by the involvement of the United States," Earnest said.
Sponsored by Democratic Senator Charles Schumer and Republican John Cornyn, who is also co-chair of the Senate India Caucus would allow victims of terror attacks on US soil or surviving family members to bring lawsuits against nation-states for activities.
"The United States needs to use every tool available to stop the financing of terrorism. Victims and families who have lost loved ones in terror attacks deserve the opportunity to seek justice," Cornyn said.
"JASTA is a long-overdue fix a responsible, balanced fix to a law that has extended too large a shield to foreign actors who finance and enable terrorism on a massive scale.
The victims of 9/11 and other terrorist attacks have suffered such pain and heartache, but they should not be denied justice and so, I will fight hard in Congress until the House passes this bill and it is signed into law," Schumer said after the passage of the bill.
JASTA amends the Foreign Sovereign Immunities Act (FSIA) so that foreign sponsors of terrorism cannot invoke "sovereign immunity" in cases arising from a terrorist attack that kills someone on American soil.
It also amends the Anti-Terrorism Act (ATA) so that civil suits against foreign sponsors of terrorism can be held accountable in US courts where their conduct materially supports an attack that kills an American.
JASTA allows terrorism victims, like victims of the September 11th attacks, the opportunity to pursue foreign states who sponsor terrorism in federal court. The bill allows Americans to direct financial damage claims against those who funded the attacks. The legislation would also afford this opportunity to families of other victims of terrorism on US soil that occurred after 11 September 2001.
It also includes an important new tool for the Executive Branch to stay litigation including related cases, not against the foreign state itself if the government certifies that it is involved in good faith discussions to resolve the matter. This stay can be extended, the Senator's office said.