This week's decision, issued from the U.S. District Court in southern New York, could mean millions of dollars each to 40 people or their estates. Such a ruling may also open the door to similar lawsuits against foreign governments for their part in terrorism, like one against Saudi Arabia's government tied to the September 11, 2001, terrorist attacks.
That said, the decision isn't final. And even if it does hold up, there's no guarantee the Palestinian Authority and Palestinian Liberation Organization will pay up.
Both groups are "deeply disappointed" by Monday's ruling, which Palestinian Authority spokesman Mahmoud Khalifa said stemmed from "baseless" charges and "ignored the legal precedent set time and again by other U.S. courts ... that established U.S. courts are not the proper jurisdiction for such a hearing."
Khalifa expressed confidence that the PLO and Palestinian Authority will prevail in American courts during its coming appeal.
Palestinian leaders are combating "extremism and violence and maintain a strong commitment to nonviolent resistance and international legal, political and moral redress," the spokesman added, claiming that this case doesn't help in this regard.
"This case is just the latest attempt by hardline anti-peace factions in Israel to use and abuse the U.S. legal system to advance their narrow political agenda," Khalifa said. "The decision is a tragic disservice to the millions of Palestinians who have invested in the democratic process and the rule of law in order to seek justice and redress their grievances, and to the international community which has invested so much in financial and political capital in a two-state solution."
Man who survived 9/11, Jerusalem attack among plaintiffs
The U.S. case dates back to the Second Intifada, or armed uprising, in which Palestinians staged a series of deadly attacks inside Israel. According to figures from Israel's internal security agency, known as the Shin Bet, some 488 Israelis died in suicide attacks between 2001 and 2004.
Americans got caught up in some of those attacks, including the dozens listed in the U.S. court case. A few were killed, more were burned or wounded by gunshots or shrapnel, while others suffered "severe emotional, mental and economic harm," according to a related complaint.
One such American was Mark Sokolow.
On 9/11, the lawyer from New York escaped the World Trade Center before its twin towers collapsed. Then, four months later, he was walking through West Jerusalem when a bomb went off, killing one man
and wounding more than 110 people.
Sokolow afterward told CNN that he suffered mostly superficial injuries, though his wife's condition was "a little bit more serious."
"I feel very fortunate that someone, God, is looking over us to make sure that we're OK," he said then.
Lawyer: Decision helps 9/11 suit against Saudis
That and other attacks occurred when Yasser Arafat led the Palestinian Authority and as Israeli authorities clamped down on him and his allies. The violence abated when then-PA Prime MInister Mahmoud Abbas began to take over -- a move that became complete with Arafat's death in 2004. Abbas, who has preached nonviolence even as issues with Israel have persisted, has been President now for a decade.
The U.S. case was tried in New York because the PLO has an office in New York City, which is home of the United Nations.
Even if it did not appeal, the Palestinian Authority would appear hard-pressed to pay damages to the plaintiffs. Israel has played a part in those issues, like its decision to freeze the transfer of more than $127 million in tax revenues
collected on behalf of the Palestinians in the wake of their bid to join the International Criminal Court, according to Israel's Haaretz newspaper.
Yet this week's decisions isn't just about the Palestinians. Jerry S. Goldman, a lawyer for 9/11 families suing Saudi Arabia and others, thinks it may help in his clients' case as well.
"If you cut off the funding, you cut off the terror," Goldman said. "And U.S. courts are showing that they can handle transnational terror litigation and make powerful individuals, institutions and governments who have materially supported terrorists' pay."