$71.5 Million Hamas Terror Attack Judgment at Stake at SCOTUS

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By Melissa Heelan Stanzione

The U.S. Supreme Court during oral arguments Dec. 4 tried to determine congressional intent in a case about whether victims of a Hamas suicide bombing can collect on their $71.5 million judgment against Iran.

At issue is when international law allows terror victims to go after the property of a foreign nation to enforce a judgment against it.

The justices questioned both sides about what kind of property can be seized: solely commercial property or also non-commercial, cultural property.

The petitioners here seek to seize ancient artifacts owned by Iran that are currently housed at a university in the U.S. in order to satisfy the judgment.

The respondents are the Islamic Republic of Iran, the University of Chicago, and the Field Museum of Natural History.

Suicide Bombers

Petitioners here are eight U.S. citizens who were harmed when Hamas suicide bombers attacked a pedestrian mall in Jerusalem in 1997. They sued Iran in a U.S. federal district court for providing material support to the bombers in 2003 and won a $71.5 million default judgment against the country.

The case stems from their attempt to collect on the judgment. The petitioners allege that under a section of the Foreign Sovereign Immunities Act, they can seize artifacts in the Persepolis Collection, specifically 30,000 clay tablets containing some of the oldest writings in the world.

Iran loaned the collection to the University of Chicago’s Oriental Institute in 1937 for research and translation, where they remain today.

Remedy for Victims

Congress wanted to provide a remedy to victims of state-sponsored terrorism under the FSIA, Asher Perlin, of Hollywood, Fla., argued for the petitioners.

The property of foreign nations is generally immune from judgment creditors under the FSIA.

One exception relevant here is that property used for commercial activity in the United States can be attached to satisfy a judgment against a state sponsor of terrorism.

The clay tablets aren’t commercial and the petitioners argue that another exception applies here.

Section 1610(g) protects only “quintessentially sovereign assets,” of terrorist states, such as embassies, from attachment, Perlin argued.

Let’s give an example of what you’re saying, Justice Stephen G. Breyer said to Perlin.

There’s the famous letter of Cyrus, the Persian king, saying that the Jews are free and can go back to Israel, Breyer said.

Iran has sent it around the world but under your interpretation, if it comes to the United States, you can seize it, he said.

Do you think you could seize it? Breyer asked Perlin.

Yes, Perlin said.

We’ve been waiting 20 years for judgment and “Iran does not pay judgments,” Perlin said.

With this section, “Congress finally said enough is enough,” and we can use it to enforce our judgment, he said.

Implausible Remedy

Petitioners’ account of Congress’s intent to eliminate the commercial activity requirement isn’t plausible, David A. Strauss argued for the respondents.

Strauss, a professor at the University of Chicago Law School, represented the university.

The way the statute is set up, you need to prove the property you want to attach is commercial, but then, according to them, Congress, in 1610(g) says “oh, never mind, you don’t have to show a commercial activity,” he said.

The commercial activity limit “is central to the FSIA” and “has the deepest roots in U.S. law and international law,” Strauss said.

There’s a fundamental distinction between commercial and non-commercial property, he said.

Congress could abrogate it but as this court said last term in Bolivarian Republic of Venezuela v. Helmerich & Payne Int’l Drilling Co., it’s not going to assume Congress has made a “‘radical departure from these principles’ unless it made a very clear determination to,” Strauss said.

What’s very clear here is that “Congress did not intend to override sovereign immunity in Section 1610(g),” he said.

In Helmerich, the high court raised bar for pleading standard used to sue foreign countries in U.S. courts, holding that to defeat sovereign immunity, a party has to plead factual allegations that make out a legally valid claim that property rights are at issue and the property was taken in violation of international law.

Competing Interests

The United States has competing interests here, Zachary D. Tripp, assistant to the solicitor general, argued for the government in support of respondents.

We “have a very strong interest in combating terrorism” but also want reciprocal treatment of our property abroad, he said.

The protections in Section 1610 “ensure you can’t execute against the ancient Persian artifacts like these,” Tripp said.

The case is Rubin v. Islamic Republic of Iran , U.S., No. 16-534 , argued 12/4/17 .

To contact the reporter on this story: Melissa Heelan Stanzione in Washington at mstanzione@bloomberglaw.com

To contact the editor responsible for this story: Jessie Kokrda Kamens at jkamens@bloomberglaw.com

For More Information

Argument transcript at http://src.bna.com/uGM.

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