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Flatow v. Islamic Republic of Iran

June 5, 2001

STEPHEN M. FLATOW, PLAINTIFF,
v.
THE ISLAMIC REPUBLIC OF IRAN, ET AL. DEFENDANTS.



The opinion of the court was delivered by: Royce C. Lamberth United States District Judge

MEMORANDUM AND ORDER

Now before the Court are three motions dealing with the Department of Treasury's duties in light of the enactment of the Victims of Trafficking and Violence Protection Act of 2000. First, the Department of Treasury moves to narrow the scope of a subpoena commanding it to produce certain documents. Second, the plaintiff moves to compel the Treasury Department to pay post-judgment interest on the punitive damages awarded him on March 11, 1998. Third, the Department of Treasury moves for various protective orders for its offices and officials. After a full review of the parties' memoranda, the applicable law, and for the following reasons, the Court GRANTS the Treasury Department's motion to modify the subpoena, DENIES the plaintiff's motion to compel payment, and DEFERS ruling on the Treasury Department's motion for protective orders.

I. BACKGROUND

On March 11, 1998, this Court found the Islamic Republic of Iran responsible for a bombing which caused the death of the plaintiff's daughter. The Court awarded the plaintiff over $225 million in compensatory and punitive damages. Since that time, the plaintiff has tenaciously pursued the satisfaction of this judgment. A major breakthrough occurred on October 28, 2000, when the Victims of Trafficking and Violence Protection Act of 2000 ("Victims Protection Act" or the "Act") became law. This statute permitted certain victims of terrorist acts to collect 100% of their compensatory damages from the United States Government. See Victims Protection Act, § 2002(a)(1)(B). The plaintiff exercised this right, and was paid $26 million by the Department of Treasury on January 4, 2001. In return for this payment, the plaintiff was required to, and did indeed,

relinquish all rights to execute against or attach property that is at issue in claims against the United States before an international tribunal, that is the subject of awards rendered by such tribunal, or that is subject to section 1610(f)(1)(A) of title 28, United States Code. Victims Protection Act, § 2002(a)(2)(D).

Section 1610(f)(1)(A) permits the attachment of foreign property which is regulated by certain portions of the "Trading with the Enemy Act, [the] Foreign Assistance Act of 1961, [and the] International Emergency Economic Powers Act." 28 U.S.C. § 1610(f)(1)(A).

Despite collecting $26 million under the Victims' Protection Act for his compensatory damages, the plaintiff continues to pursue satisfaction of his substantial punitive damages award. He therefore continues to rely on a June 5, 1998 subpoena served on the Department of the Treasury.

The June 5, 1998 subpoena sought from the Treasury Department the following records:

1. All documents of any type or description pertaining to any assets which any of the named defendants . . . have or ever had or with respect to which any named defendant has asserted or alleged any interest, claim, ownership right or security interest;

2. All documents of any type or description indicating ownership of assets by any of the . . . named defendants;

3. All documents of any type or description pertaining to any assets of the . . . named defendants which are in the custody, safekeeping, care, control, or constitute "blocked assets" of any of the . . . named defendants;

4. All documents indicating the location description, or nature of any assets of the . . . named defendants;

5. No document the production of which would violate 26 U.S.C. § 6103 is sought by this subpoena. See June 5, 1998 Subpoena (as modified by Memorandum and Order, Sept. 14, 2000, at 14).

Although the Treasury Department objected to the subpoena as overly broad and unduly burdensome, the Court, for the most part, rejected this challenge and ordered the Department to comply with the subpoena. *fn1

The Treasury Department now returns to this Court and again argues that the subpoena is overly broad and unduly burdensome. However, the argument this time is predicated on the plaintiff's relinquishment of certain attachment rights, as commanded by Section 2002(a)(2)(D) of the Victims Protection Act. Specifically, the Department argues that, because the plaintiff has "relinquished his right to execute or attach" certain property under Section 2002(a)(2)(D) of the Act, the subpoena should be "modified to exclude from its scope documents related to [such] property." Brief for Department of Treasury, Apr. 26, 2001, at 2. Further, the Department asks that "certain Treasury offices" receive "protective orders that further discovery not be had under the plaintiff's subpoena." Id.

Separate and distinct from the subpoena issue is the plaintiff's motion to compel the Department of the Treasury to pay post-judgment interest on the plaintiff's punitive damages award. The plaintiff argues that the Treasury's duty is made plain and clear by Section 2002(a)(1)(B) of the Victims Protection Act. That provision directs the Secretary of the Treasury to pay the plaintiff "post-judgment interest, as provided in section 1961 of . . . title [28]." Victims Protection Act, § 2002(a)(1)(B). Besides disagreeing with the plaintiff on the Treasury Department's duties under section 2002(a)(1)(B), the Treasury Department also argues that the plaintiff "cannot convert litigation regarding his Rule 45 subpoena into a proceeding involving an unrelated claim for monetary relief under Section 2002(2) against Treasury, a non-party to this lawsuit." Brief for Treasury, Apr. 26, 2001, at 22. The Department further argues that, even if the plaintiff's motion is properly before the Court, it must be dismissed because the United States has not "waived its sovereign immunity to suits of this type in the United State District Court." Id. at 24.

The Court now considers these issues.

II. ANALYSIS

A. The Defendant's Motion to Modify the June 5, 1998 Subpoena

1. Standard for Modification of a Subpoena

Rule 45(c)(3) of the Federal Rules of Civil Procedure directs a court to "quash or modify the subpoena if it . . . subjects a person to undue burden." Fed. R. Civ. P. 45(c)(3). In identifying an "undue burden", a court is to look at several factors, such as "[the] relevance [of the materials sought], the need of the party for the documents, the breadth of the document request, the time period covered by it, the particularity with which the documents are described and the burden imposed." Alexander v. FBI, 186 F.R.D. 21, 34 (D.D.C. 1998) (citing United States v. International Bus. Machines, Corp., 83 F.R.D. 97, 104 (S.D.N.Y. 1979)). See also Linder v. Calero-Portocarrero, 180 F.R.D. 168, 173 (D.D.C. 1998). When the burdensomeness of a ...


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