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Friday, July 19, 2024 | Back issues
Courthouse News Service Courthouse News Service

High Court Takes Up Bank’s Appeal of Iran Judgment

WASHINGTON (CN) - The Supreme Court agreed Thursday to look at a law that helps victims of a terrorist attack collect a $1.75 billion judgment against Iran's central bank.

Nearly 300 U.S. and French service members were killed in the Oct. 23, 1983, attack on U.S. Marine Barracks in Beirut, Lebanon. The chief federal judge in Washington, D.C., held Iran and its intelligence agency liable for the attack in 2007 but could not award punitive damages at the time because the laws did not allow it.

After Congress tweaked the legislation to allow for that outcome, the court awarded large money judgments in a series of cases, including a $2.1 billion judgment in Peterson v. Islamic Republic of Iran. The plaintiffs in that case then turned to the Southern District of New York, where a judge previously ordered Citibank to freeze almost $2 billion in debt securities allegedly owned by Iran.

The lawsuit also accused the Luxemburg-based bank Clearstream and the Rome-based Banca UBAE of helping Bank Markazi, an agency of Iran, of moving $250 million in frozen assets outside the United States.

Clearstream and Banca UBAE later settled their cases with the plaintiffs separately.

Bank Markazi asserted that the remaining $1.75 in frozen assets could not be turned over to Deborah Peterson and her co-plaintiffs under the governing statute, the Terrorism Risk Insurance Act of 2002.

Congress removed that hurdle two years ago in passing the Iran Threat Reduction and Syria Human Rights Act of 2012.

A provision of the law says "the financial assets that are identified in and the subject of proceedings in the United States District Court for the Southern District of New York in Peterson et al. v. Islamic Republic of Iran et al... shall be subject to execution."

In early 2013, two weeks before the 30th anniversary of the attack, a federal judge in Manhattan ordered the turnover of the assets and denied the bank immunity.

A three-judge panel of the Second Circuit affirmed last year, rejecting Iran's claim that Congress violated the separation of powers by compelling a predetermined outcome.

Per its custom, the U.S. Supreme Court issued no comment in granting Bnak Markazi a writ of certiorari Thursday.

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