U.S. District Judge Victor Marrero of New York said the original order would be dismissed if the Palestinian Authority posted a $192.7 million bond to secure that it would not have a repeat default if it does not win its case, The Washington Post reported Friday.
In Marrero's court decision Wednesday he called on the Palestinians to compensate the plaintiffs' for court costs, the Post said.
Marrero's ruling reportedly has fostered optimism for the Palestinian Authority that it will be able to avoid legal battles that government officials said could send it into financial turmoil.
The Post quoted the Bush administration as saying it was worried that lawsuits by terrorist attack victims might damage the Palestinian Authority's "financial and political viability."
Martin Bashir resigns from MSNBC over Sarah Palin comments
Ron Burgundy interviews Peyton Manning on SportsCenter