Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Friday, March 29, 2024 | Back issues
Courthouse News Service Courthouse News Service

Bank deflects suit from hostages of Iranian revolutionaries freed in 1981

The Second Circuit found that the deadline expired 38 years ago for Chase Manhattan Bank to face questions about its role in the Iran hostage crisis.

(CN) — New information about Chase Bank's purported role in triggering and prolonging the siege of the American Embassy in Tehran where dozens of diplomats were held captive for 444 days is not new enough, the Second Circuit ruled Tuesday, to justify a lawsuit decades after the fact.

In their lawsuit, the survivors claim that the narrative about the Iran hostage crisis of 1979 only shifted in 2019 with a New York Times story describing recently unsealed papers donated to Yale University, kept under wraps until the death of former Chase Manhattan Bank CEO David Rockefeller

Those papers disclosed how Chase Bank executives in 1979 had misrepresented the health of Iran's then-recently deposed shah to secure his admission into the U.S. for medical treatment, knowing full well that the move could spark an attack on the U.S. embassy in Tehran.

Once the U.S. Embassy fell to Islamist revolutionary students on Nov. 4, 52 Americans within its walls were imprisoned and tortured for 444 days — not freed until the Jan. 20, 1981, inauguration of President Ronald Reagan, who had defeated President Jimmy Carter amid that turmoil.

The survivors say their captivity could have been shorter, but bank officials spread rumors and sunk a deal that would have released the hostages in an “October surprise” during the 1980 presidential election. As for why, they point to the bank's financial interests, having processed National Iranian Oil Company revenues and helped start the International Bank of Iran, among other factors.

Against their claims that the bank had misled investigators and kept documents under wraps, the Second Circuit ruled Tuesday, however, that the survivors offered little evidence they spent the last four decades searching for the truth, conducting due diligence.

“Here, plaintiffs discovered their injury and undoubtedly knew enough to seek legal advice regarding, for example, a claim for false imprisonment on the day they were released from captivity in January 1981,” according to the panel's unsigned summary order.

Indeed, long before the 2019 article in the Times, the same newspaper had reported in 1981 that Chase's CEO Rockefeller had lobbied for the Shah’s entry into the U.S. and there was suspicion he had done so because of the bank’s investments in the country.

The panel also pointed to references in the 2007 book "The Road to 9/11" by Peter Dale Scott and a page in Robert Parry’s book "Secrecy & Privilege," published in 2004, which mention the bank's hand in prolonging the hostage crisis until Reagan took office.

“Plaintiffs’ suggestion that it would have been impossible before 2019 for them to uncover the actions of the Chase representatives is therefore implausible,” the panel wrote.

Tuesday's ruling came only weeks after oral arguments in Manhattan in which the former hostages said their efforts were beguiled by a 1993 congressional investigation that cleared Rockefeller and other Chase executives in connection to the crisis.

The panel was made up of U.S. Circuit Judges Susan Carney, Steven Menashi and Myrna Perez, appointed by Presidents Obama, Trump and Biden, respectively.

A lawyer for survivors of the Iran hostage crisis and spokespersons for the successor of the bank, JPMorgan Chase & Co., and the law firm representing it at the Second Circuit did not return requests for comment.

Survivors of the crisis tried unsuccessfully to sue Iran a handful of times over the years. In 2010, a federal judge in Washington dismissed a lawsuit that sought $6.6 billion in damages from Iran over the crisis.

Follow @jcksndnl
Categories / Appeals, Business, Civil Rights, Financial, National

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Loading...