The paper begins with an overview of international law and the principle of state immunity, which is included to provide a necessary introduction for readers who are unfamiliar with these topics. Part two assesses the practice of Canada and the United States by examining the legislated exceptions to state immunity that allows claims against foreign states that sponsor terrorism, as well as the decision in Tracy (Appeal). Part three returns to international law and explores the decision of the ICJ in Jurisdictional Immunities. This examination calls into question whether, through Tracy (Appeal), Canada has violated Iran’s right to immunity under current customary international law. Part four considers the potential for Canada to be a “custom breaker” leading the way towards the recognition of a new exception to state immunity under international law. Since an evolution in international law would require additional states to embrace the legality of such claims, part five addresses the risks that may result from allowing civil claims against states and part six canvasses alternative means for achieving justice for victims of state-sponsored terrorism and other international crimes.