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Families of American victims of the October 7 Hamas massacre on Monday filed a lawsuit in U.S. federal court in Washington DC, accusing Palestinian-American billionaire Bashar Masri of knowingly providing substantial aid to Hamas’ terror infrastructure in Gaza and providing electricity to the tunnel network that enabled the holding of hostages as part of the deadliest attack in Israel’s history
Among the plaintiffs are Israel's former science and technology minister Yizhar Shai, whose son, Sergeant Yaron Uri Shai, was killed on October 7; tech entrepreneur Eyal Waldman, whose daughter and her partner were murdered at the Nova music festival massacre; the family of Hersh Goldberg-Polin, who was murdered in Hamas captivity; and Israeli Ambassador to the U.S. Yechiel Leiter, whose son Moshe fell in battle in Gaza.
Masri, the former CEO of the Karni Industrial Zone, is considered to be the de facto secret advisor to the Trump administration and appears to be the "shadow figure" of the U.S. envoy for hostage affairs, Adam Boehler, who caused a stir after it was learned that he was involved in direct talks with senior Hamas officials.
Masri also has previously been considered as one of the options examined within the framework of Israeli and American plans for distributing humanitarian aid in the Gaza Strip, while attempting to locate senior Palestinian officials who are not affiliated with Hamas - and who may in the future be able to play some kind of governmental role in Gaza. The lawsuit being filed Monday is likely to damage Masri's credibility in the eyes of political figures who saw him as a moderate or reformist figure.
The lawsuit describes a complex web of connections, projects and economic developments - some of which were financed by international bodies such as the World Bank, the European Union and USAID, as well as American taxpayer money and which, according to the indictment, were also used for terrorist purposes.
At the heart of the allegations is the developing industry of green projects in Gaza – and at its center is the Gaza Industrial Estate (GIE), which was established in 1997 with USAID funding, part of the Karni Industrial Zone, which was initiated and managed by entities affiliated with Masri. According to the allegations, the area served as a legitimate business front, but beneath the surface Hamas attack tunnels operated that penetrated deep into Israel, including into the nearby kibbutzim from which the hostages were taken.
The lawsuit describes how Hamas’ tunnel network, which began more than a decade ago and was restored after Operation Protective Edge in 2014, received renewed momentum, in part thanks to renewable energy development projects, including solar energy, which provided the electricity needed to maintain the underground infrastructure.
Those projects, according to the lawsuit, received extensive international funding, some of which was channeled through the U.S. government and international bodies – with the knowledge of Masri and apparently in coordination with Hamas.
Two additional properties owned by Masri and cited in the lawsuit as having been used by Hamas are the Blue Beach Resort and the Ayian Hotel. The lawsuit claims a Hamas tunnel network ran beneath the hotels, accessible from guest rooms and other facilities, and that Israeli forces discovered tunnel shafts and weaponry on the premises.
The Blue Beach Hotel allegedly served as a tunnel hub connecting to a Hamas training base used by the terrorist group’s naval commando unit. In January 2024, the IDF said that Hamas "used the hotel as a shelter from which it planned and carried out attacks both above and below ground."
According to the lawsuit, Masri’s properties were not only part of the infrastructure Hamas used on October 7 itself — their development was intentionally designed to support Hamas’ false narrative that it was primarily interested in Gaza’s economic growth and peaceful coexistence with Israel.
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Bashar Masri in a building going up in the new West Bank Palestinian city of Rawabi
(Photo: Facebook)
The lawsuit alleges that Masri, Chairman of the Palestine Development and Investment Company (PADICO) and Massar International, knowingly worked with Hamas for many years despite the group’s designation as a Foreign Terrorist Organization (FTO) by the U.S. government since 1997. Masri is a naturalized American citizen with significant business ties to global corporations such as Apple and Nvidia, and he also sits on the board of Harvard’s Kennedy School of Government.
According to the lawsuit, these companies owned and built luxury hotels and the central industrial zone in the Gaza Strip – which in part served as operational infrastructure for Hamas. The lawsuit also states that Masri himself presided over the signing ceremony of a cooperation agreement with Hamas in 2022 for the rehabilitation of the industrial zone, with the other party to the agreement being the deputy minister of economy in the Hamas government in Gaza, Abdel Fattah al-Zari, who was killed by the Israeli Air Dorce in a targeted assassination of his home last August.
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According to the complaint, PADICO-owned hotels hosted key Hamas events and served as venues for Hamas leaders, including Yahya Sinwar and Khalil al-Haya, to host foreign dignitaries at the al-Mashal Hotel.
The U.S. plaintiffs allege a series of serious violations of the Anti-Terrorism Act, which allows U.S. citizens to sue entities that aided or abetted terrorism against American citizens. They are seeking monetary damages for the deaths of their loved ones – damages that could be tripled under U.S. law – as well as punitive damages designed to punish and deter. Beyond the monetary aspect, they are demanding that Masri and companies under his control be held civilly liable for knowingly aiding a terrorist organization, while exploiting international funding to establish an offensive infrastructure that harmed American citizens. Some 46 Americans were murdered in the attacks on October 7.
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Former science and technology minister Yizhar Shai and his son Sergeant Yaron Uri Shai who fell on October 7
(Photo: Hadar Yoavian)
The plaintiffs represent families whose loved ones or parents were killed in the attack. “We cannot return to the pre-October 7 mindset, where people delude themselves that strengthening the economy in Hamas-controlled Gaza does not also mean strengthening its terrorist infrastructure,” said the bereaved father and former minister Shai.
“The prosecution presents evidence that senior Palestinian investors raised funds from the World Bank, the UN and the European Union to build an industrial zone and luxury hotels in Gaza – while at the same time working with Hamas to build the terror tunnels underneath them,” he added.
The parents of Iris Weinstein Hagai, another plaintiff in the case, were killed in the massacre. “Since October 7, our first goal has been the return of the hostages,” she said. “But we also demand accountability – not only from Hamas but also from those who knowingly, even if indirectly, helped it. American law allows this."
The plaintiffs are represented by the American law firms Osen LLC, Willkie Farr & Gallagher LLP, Stein Mitchell Beato & Missner LLP, and Motley Rice LLC. The attorneys representing the victims have served as co-lead counsel in some of the most significant civil terrorism cases over the past two decades, including the 9-11 litigation, as well as Anti-Terrorism Act cases brought against Arab Bank, Chiquita Brands, and Bank of China.
According to attorney Gary Osen, who is leading the prosecution team, this is a critical chapter in exposing the infrastructure that enabled the Hamas attack.
“Any assessment of the factors that enabled Hamas to carry out these unprecedented attacks is woefully incomplete without considering the terror tunnel network’s central role. Palestinian attack tunnels, which have plagued the Israeli people for more than a decade now, were activated to unprecedented levels on October 7th,” he said.
Masri said in response: "Bashar Masri is a successful and respected Palestinian American entrepreneur and business leader. He was shocked to learn through the media that a baseless complaint was filed today referring to false allegations against him and certain businesses he is associated with. Neither he nor those entities have ever engaged in unlawful activity or provided support for violence and militancy.
"Bashar Masri has been involved in development and humanitarian work for the past decades. His continued efforts to promote regional peace and stability have been widely recognized by the United States and all concerned parties in the region. He unequivocally opposes violence of any kind. He will seek the dismissal of these false allegations in court."