Families Who Sued Libya See Their Victory Voided

U.S. Pact Nullifies $6 Billion Award in '89 Bombing Over Africa

As the State Department reviews hundreds of claims from people who lost family members in Libyan-sponsored terrorist attacks, controversy is building over a case that is so low-profile it is sometimes called "the forgotten flight."

The case stems from the Sept. 19, 1989, bombing of the French-operated UTA Flight 772, which crashed in the Niger desert after a suitcase bomb exploded in the cargo hold, killing 170 passengers and crew, including seven Americans.

Family members of the American victims made history in January by becoming the first and only group to successfully sue Libya in federal court. After hearing the Pugh case -- named for the family of one of the victims -- U.S. District Judge Henry H. Kennedy found Libya responsible for the attack and awarded 44 relatives a collective $6 billion.

Plaintiffs in the case became incensed in August when the United States reached an agreement with Libyan leader Moammar Gaddafi to dismiss all lawsuits for victims of state-sponsored terrorism. Gaddafi agreed to turn over $1.5 billion, and the U.S. government started setting up a process for reviewing survivor claims and distributing the money.

To the outrage of families involved in the lawsuit, their gut-wrenching court victory was nullified as the United States agreed to use the settlement to reestablish diplomatic relations with Libya. And many family members learned they would have to prove again that they are victims who are entitled to payments from Libya.

"We fought this fight. We stood up to terrorists who took our loved ones and we did so in federal court," said Anne Carey, whose mother, wife of then-Ambassador to Chad Robert Pugh, died in the attack. "We felt we accomplished something. For it to be dismissed is beyond comprehension. Surely, you can't just disregard what a federal court has decided."

The State Department contends that its process treats Flight 772 victims as fairly as other victims of state-sponsored terrorism. An assistant legal adviser in the department, Linda Jacobson, said named beneficiaries of the seven victims will receive $10 million settlements and be eligible to appeal for more to the Justice Department's Foreign Claims Settlement Commission, which is reviewing claims.

"The other Pugh claimants," she said in a statement, "will be able to seek compensation for their emotional distress in the same manner as family members of other victims of terrorism."

The issues involved in the dispute date to the 1980s, when Libya was implicated in a spate of international terrorism incidents. The highest-profile case was the bombing 20 years ago of Pan Am Flight 103 over Lockerbie, Scotland, which killed 270 people, including 180 Americans. In 1986, the bombing of the La Belle disco in Berlin killed three people, including two Americans. Among the 229 wounded were 79 Americans.

Then, there was UTA Flight 772. The dead on the flight were from 17 countries. Bonnie Barnes Pugh, Anne Carey's mother, was among them.

France claimed 54 of the victims, and government investigators there took the lead in going after Libya. They spent eight years reconstructing the bombing, using the remains of detonator wires that were traced back to Libyan intelligence agents.

A 1999 case in French criminal courts resulted in the conviction of six Libyan officials in absentia. In 2004, Libya settled with France and agreed to pay $170 million in compensation, $1 million to each victim on Flight 772, including those from Africa and the United States.