US Supreme Court seems to lean to allow terror victims to get frozen Iran funds

Along with a large number of law firms, NGO Shurat Hadin is involved in case representing the Rubin family, whose family member was injured in a 1997 double suicide bombing in Jerusalem.

By
January 14, 2016 18:51
4 minute read.
Beirut bombing 1983

Beirut bombing 1983. (photo credit: REUTERS)

 
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While a decision may not come until June, the US Supreme Court seemed to be seriously entertaining allowing around $2 billion in frozen Iranian funds to go to families of Americans killed in attacks blamed on Iran.

The court heard an appeal by Bank Markazi, Iran’s central bank, contesting a 2014 ruling that the money be handed to plaintiffs representing hundreds of Americans killed or injured in a 1983 bombing of a US Marine Corps barracks in Beirut, the 1996 Khobar Towers truck bombing in Saudi Arabia, suicide bombings in Israel and other attacks.

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The payments would go toward satisfying a $2.65 billion judgment against Iran won in US federal court in 2007 in a case filed six years earlier. The money is held in New York in a trust account at Citibank, part of Citigroup Inc., but was not fully discovered until 2008-2010.

At issue before the Supreme Court, is whether Congress violated the separation of powers principle enshrined in the US Constitution by passing a law that specified the funds held in the trust account go toward paying off the judgment.

The US Supreme Court generally defers to the executive on cases involving foreign policy, especially if Congress stands with the Executive, as is the case with this verdict.

Justice Antonin Scalia said Congress regularly enacts laws that are narrow in focus and that they are constitutional as long as they do not interfere with cases already decided in court.

Justice Ruth Bader Ginsburg said that the case heard on Wednesday concerned judgments in 19 lawsuits.



Justices Elena Kagan and Stephen Breyer suggested the case should be viewed from a foreign policy perspective.

Generally, in foreign policy disputes, courts give more deference to the executive branch. In the Iran case, President Barack Obama and congressional leaders support the plaintiffs.

In that vein, Justice Anthony Kennedy, who often casts the deciding vote in close cases, wondered if Congress has more leeway when the US has “very delicate relations” with the country in question, as with Iran.

On the flip side, Chief Justice John Roberts, seizing on an argument made by Bank Markazi, appeared troubled by Congress improperly dictating the outcome of legal disputes by passing a 2012 law specifically relating to this case to help victims’ families obtain the money.

During a one-hour oral argument in a case being heard at a delicate time in US-Iranian relations, Roberts used the analogy of a “strongman” leader of a foreign country calling the judiciary to tell judges how to rule.

“I’m not sure I see what the difference is here,” Roberts said.

Roberts’ harsh attack on the congressional law and the position of the victims surprised some since in June he was adamant in the Zivitofsky case – about whether US citizens born in Israel could write Jerusalem on their passports at place of birth – that Congress could intervene in heated foreign policy issues.

There he voted in favor of congressional power in foreign affairs despite the case having major political and diplomatic implications and despite being in the minority on the court, which struck down that congressional law 6-3.

There was some uncertainty about how other justices would ultimately vote in the Iran case.

Kennedy grilled lawyers on both sides, criticizing the argument made by the Obama administration’s lawyer, Edwin Kneedler, in support of the families.

The plaintiffs accused Iran of providing material support to Hezbollah, the Iran-backed Shi’ite Islamist political and military group responsible for the 1983 truck bomb attack at the Marine compound in Beirut that killed 241 US servicemen.

They are also seeking compensation on behalf those killed or injured in other attacks they linked to Iran, including the 1996 Khobar Towers truck bombing in Saudi Arabia that killed 19 US service members.

The lead plaintiff in the case is Deborah Peterson, whose brother, Marine Lance Corporal James Knipple, was killed in the Beirut bombing.

Along with a large number of law firms, Israeli NGO Shurat Hadin is representing the Rubin family whose family member was injured in a 1997 double suicide bombing on Ben-Yehuda Street in Jerusalem.

A ruling is due by the end of June.

Shurat Hadin also has a range of other judgments against Iran, not a part of the current case, which have led it to seek an injunction in a New York court against the thawing of foreign funds until their other clients, families of victims of other terrorist attacks, are compensated.

The funds were supposed to be unfrozen under a landmark accord reached by the United States and five other world powers last July to lift economic sanctions in exchange for Iran accepting limits on its nuclear program, which is expected to be implemented in the coming days.

Those hoping for the court to rule in their direction noted that the Obama administration’s supporting the victims showed that even as it is working with Iran on nuclear issues, that it is maintaining a tough stance on terrorism-related issues, including these cases before the court.

Reuters contributed to this report.

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