Questions Dog Feds’ Entrance Into Libel Fray

     MANHATTAN (CN) – The United States has intervened in a mysterious libel case between a Greek shipping magnate and the pro-Israel group United Against Nuclear Iran. But the intervention has left the magnate’s lawyers wondering whether it’s state secrets – or the depth of the United States’ involvement with the group – that the government is working to protect.
     More than a year has passed since Victor Restis, 46, sued UANI for targeting him in a “name and shame” program that cast him as Iran’s “front man” for illicit oil exports.
     But for reasons the United States has yet to give, lawyers for the government told the court earlier this year that Restis’ case threatens to spill state secrets. And the Justice Department formally entered the case a few weeks ago – claiming law enforcement privilege – in a bid to have it dismissed.
     That doesn’t sit well with Restis, whose lawyers contend in a 30-page memorandum filed Wednesday that granting the government’s wish will create a “license to defame” Restis.
     “Everything about the government’s intervention is strange,” attorney Abbe Lowell, of the Washington-based firm Chadbourne & Parke, wrote in the memo. “What is that state secret? Unless UANI violated the laws governing the handling of classified materials, nothing in their possession could properly be classified. If the refusal to disclose information is to protect a source of information to the government, then the original assertion of the law enforcement privilege, with its requirements for more public disclosure and a balancing of interest, would be appropriate. If the refusal is based on protecting a relationship UANI has with a foreign entity, then whatever the secret is would relate to a foreign country and not the U.S. government. Finally, if the government is using UANI to harm the plaintiffs, there is a serious concern that the government, as it has done before, is improperly asserting the state secrets privilege to avoid embarrassment or the disclosure of its own wrongdoing or something it ought not be hiding.”
     While Restis’ lawyers call the move “unprecedented,” the government has cited two defamation cases it successfully had booted on national security grounds: Fitzgerald v. Penthouse and Trulock v. Wen Ho Lee. The former delved into a CIA scientist’s research on weaponized dolphins, and the latter involved a Los Alamos scientist accused of giving nuclear secrets to China.
     Unlike those cases, however, Restis has no apparent relationship with any military technology.
     Lowell contrasted his client’s case with U.S. v. Reynolds, where an Air Force bomber led to the creation of the state secrets privilege.
     “This is not a case where a U.S. military plane crashed while testing secret military technology – circumstances that naturally led the court to tread carefully in discovery,” he wrote. “Here, there is no obvious involvement by the government at all, and the case itself is about public claims, not secrets.”
     And even in the Reynolds case, the government filed affidavits from the Secretary of the Air Force and the Air Force Judge Advocate General – and did so publicly, the memo notes. But in Restis’ case, the government wants to argue for dismissal in classified briefings for the judge’s eyes alone, Lowell said.
     “There is no reason not to allow this procedure in a case of this rarity,” Lowell wrote, calling such secrecy “un-American.”
     Lowell suggested that UANI may be trying to “graymail” the United States – an intelligence term referring to a threat to disclose classified information in an effort to influence litigation – by threatening to expose details of its own relationship with the government to get the case tossed.
     “The government’s intervention is what is giving UANI this ‘license to defame’ where they use the supposed state secrets as both a sword and shield,” Lowell wrote. “In effect, UANI may be graymailing the government by using the information or relationship it has for its campaigns and then threatening to expose that information or relationship if the government does not end a case brought by those against whom its campaigns are directed.”
     Meanwhile, UANI continues to blare its allegations against Restis “as loudly as they can to the world,” and none of the contentions appear to be related to state secrets, the memo stated.
     “There does not seem to be a state secret in the actual libelous claims made by UANI itself because, rather than keep those claims a secret, it has shouted them everywhere they can,” Lowell wrote. “If the state secret lies in how the UANI got that information or why it made those libelous claims, this is an all the more unique case where UANI is using the state secrets as both a sword (as the basis to attack the plaintiff) while also using the state secret as a shield (in seeking to dismiss this case). In no other context are parties permitted to use a privilege as both a sword and a shield. The court should not place the defendants above the law and give them something no court, as best we can tell, has ever given anyone – a license to commit defamation with impunity in the future.”
     The Jerusalem Post recently published a retraction to a story that it ran about Restis, purportedly based on information that UANI provided the paper. The paper’s clarification and apology stated what the Greek shipping magnate has maintained throughout the litigation: that his vessels that docked in Iran only carried authorized humanitarian food shipments.
     Lawyers for UANI did not immediately respond to a request for comment.
     The U.S. Attorney’s office declined to comment.

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