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Bennett v. Islamic Republic of Iran

March 31, 2009

MICHAEL BENNETT AND LINDA BENNETT INDIVIDUALLY AND AS CO-ADMINISTRATOR OF THE ESTATE OF MARLA ANN BENNETT PLAINTIFFS,
v.
THE ISLAMIC REPUBLIC OF IRAN, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Royce C. Lamberth Chief Judge

MEMORANDUM OPINION

The United States has moved to quash five writs of attachment issued against properties belonging to the Islamic Republic of Iran. Dk. # 34. These properties largely comprise the former Iranian Embassy compound here in Washington, D.C. This includes the former Ambassador's residence, Iran's former Embassy Chancery, as well as a separate diplomatic residence, and two parking lots.*fn1 Plaintiffs obtained the writs attaching these properties of Iran in an effort to satisfy a judgment they received in an action pursuant to the 28 U.S.C. § 1605(a)(7), the state sponsor of terrorism exception to sovereign immunity. See Dk. #s 20-22. For the reasons expressed herein, the Court will grant the Government's motion to quash the writs of attachment.

Facts and Procedural History

Marla Ann Bennett, an American citizen and resident of California, was just 24 years old when she was murdered by terrorists. She was killed when Hamas operatives detonated a bomb inside a cafeteria at the Hebrew University in Jerusalem in July of 2002. In an effort to achieve some measure of justice, Marla's parents brought a civil action against Iran and its Ministry of Information and Security (MOIS) under § 1605(a)(7). The Bennetts demonstrated through evidence satisfactory to this Court, see § 1608(e), that Iran and its MOIS provided material support to Hamas in furtherance of terrorist objectives. See Bennett v. Islamic Republic of Iran, 507 F. Supp. 2d 117 (D.D.C. 2007) (Lamberth, J.). Plaintiffs were awarded a judgment in excess of 12 million dollars. To date, that judgment remains unsatisfied.

In an effort to execute their judgment against Iran, plaintiffs procured the writs of attachment on the properties at issue in this case. Due to the manner in which plaintiffs attached these former diplomatic properties, however, this matter has a strange and somewhat tortured procedural history. Contrary to the usual procedure for the issuance of writs attachment, in which the request is handled directly by the Clerk's office in accordance with long-standing procedures established by this Court, plaintiffs' counsel instead filed a separate motion requesting that this Judge specifically order the Clerk of Court to issue the five writs. See Dk. # 22. Plaintiffs' counsel later filed a supplemental memorandum in support of the motion for writs of attachment. See Dk. # 24. In that memorandum, counsel observes that in Flatow v. Islamic Republic of Iran this Judge quashed five writs of attachment on some of the very same properties at issue here. See Dk. # 24 at p. 2 (citing 76 F. Supp. 2d 16 (D.D.C. 1999) (Lamberth, J.))*fn2 Counsel argues, however, that both the relevant facts and the applicable law have changed since that decision in Flatow and, as a result of those changes, Iran's properties here in Washington are no longer immune from attachment. See id at 2-7.

At the time plaintiffs' supplemental memorandum was filed, the United States had not yet entered an appearance in this action, let alone moved to quash plaintiffs' writs of attachment. Nonetheless, plaintiffs' counsel suggests in his supplemental memorandum that the United States does not have standing to move this Court to quash writs of attachment issued against Iran's former embassy properties, notwithstanding the fact that it was the United States that successfully moved to quash the writs in Flatow. See Dk. # 24, p. 7-10. Counsel's argument relies heavily -- if not exclusively -- on Rubin v. Islamic of Iran, a case from the Northern District of Illinois in which the court held that the University of Chicago did not have standing to challenge writs of attachments issued against collections of Persian artifacts on loan to the university from Iran. See id (citing 408 F. Supp. 2d 549 (N.D. Ill. 2005)).*fn3

Plaintiffs' counsel ultimately withdrew his motion for an order to issue of writs of attachment, but the writs of attachment were issued by the Clerk of the Court about a week later on April 1, 2008. See Dk. # 26. Counsel subsequently filed executed returns on the writs on June 5, 2008. See Dk. #s 27-31. Accordingly, the record suggests that the plaintiffs' counsel withdrew the motion in order to procure the writs through the Clerk's office in accordance with the normal and long-established procedures of this Court. While this Court normally does not consider motions or other matters that have been withdraw by counsel, this Court will nonetheless accept the withdrawn motion and supplemental memorandum for the limited purpose of establishing that counsel believed he had some good faith basis for procuring writs of attachment against former diplomatic properties of Iran.

Undeterred by plaintiffs' peremptory arguments, the United States moved to quash all five writs of attachment on July 18, 2008. See Dk. # 34. Plaintiffs filed their opposition in a timely manner and the United States timely filed its reply. See Dk. #s 35 & 36. More than two months later, however, and without leave of the Court, plaintiff filed another supplemental memorandum and several exhibits as additional support for their opposition to the Government's motion to quash. Dk. # 37. The Government then filed a response to the plaintiffs' supplemental memorandum four days later on October 21, 2008. See Dk. # 40. In that response, the Government requests that plaintiffs' supplemental filing be struck from the record or disregarded.

Arguments of the Parties

The United States

The United States argues that plaintiffs' writs of attachment must be quashed because the properties at issue are immune from attachment in light of several important legal authorities. The United States calls this Court's attention to the Vienna Convention on Diplomatic Relations (Vienna Convention), 23 U.S.T. 3227, T.I.A.S. No. 7502 (1972), the Foreign Missions Act, 22 U.S.C. §§ 4301, et seq., the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. § § 1602, et. seq., the Terrorism Risk Insurance Act (TRIA), Pub. L. No. 107-297, Title II, § 201 (Nov. 26, 2002), codified as 28 U.S.C. § 1610 Note, and several Executive Orders and Federal Regulations relating to properties belonging to Iran in the United States. See Dk. #34. The Government emphasizes that the United States is now holding the former diplomatic properties of Iran in protective custody pursuant to the terms of the Foreign Missions Act and consistent with the Federal Government's obligations under the Vienna Convention. See Id at p. 1, 8-10, Exh. 1. The United States claims that, in order to fulfill its responsibilities under the Vienna Convention and Foreign Missions Act, the State Department's Office of Foreign Missions (OFM) has periodically leased Iran's properties to other foreign governments or to private parties and has used the income derived from those rentals to fund necessary maintenance and repairs of the properties. See Dk. 34 at p. 10.

In light of its multilateral treaty and statutory obligations, as well as the overall importance of the foreign policy interests presented here, the United States stresses that it therefore has at least two independent bases on which it may assert standing in this action. First, the Government relies on 28 U.S.C. § 517, which vests the Attorney General with broad authority "to send any officer of the Department of Justice to 'attend to the interests of the United States in a suit pending in a court of the United States.'" Id at p. 11. Second, the United States argues that, regardless of the scope of any statutory authority provided under 28 U.S.C. § 517, long-standing case precedent establishes that the Federal Government has standing to assert and protect its own important foreign policy interests. See Id. See also Dk. # 36 at p. 1-5.

The Government observes that on at least two prior occasions this Court determined that the very properties at issue here are immune from attachment. See Id at p. 20-21 (citing Flatow, 274 F. Supp. 2d 18; Mousa v. Islamic Republic of Iran, 00-cv-2096 (D.D.C. 2003) (Bryant, J.)). According to the Government there's been no subsequent change in the applicable facts or law the would render those properties subject to attachment now. See id. at 13-21; Dk. # 36, p. 6-7. In particular, the Government emphasizes that Congress did not intend that the enactment of § 1083 of the 2008 NDAA and the new state sponsor of terrorism exception 1605A to allow for the attachment of diplomatic properties. See Dk. # 34at p.13-16.

Finally, the Government asks that this Court strike or otherwise disregard plaintiffs supplemental filings in this matter. See Dk. # 40. The United States emphasizes that the supplemental materials were filed in contravention of the local rules without leave of the Court, and that, in any event, the materials are not relevant to this dispute. See id.

Plaintiffs Michael and Linda Bennett

Plaintiffs' primary argument is the United States does not have standing to challenge the writs of attachment issued against Iran's former diplomatic properties. See Dk. 35 at p. 1-5. In plaintiffs' brief that is heavy on rhetoric, counsel is largely dismissive of the United States' position, asserting that it is "insulting to the intelligence of the American people." Id at p. 4. Plaintiffs' counsel cast the United States as effectively mounting a defense of Iran, and argues that the United States should be precluded from doing so in this case because Iran has proven more than capable of defending itself in actions in this district and in other federal courts throughout the country. Id at 2-5. Counsel again relies on Rubin v. Islamic Republic of Iran, a case pending in Chicago in which the federal district court there determined that certain private litigants -- the University of Chicago and others -- do not have standing to assert sovereign immunity in an action in which certain judgment-creditors of Iran are seeking attachment or execution of certain artifacts on loan from Iran to the University of Chicago. See Dk. 35 at p. 2-5.

On the merits, plaintiffs claim that neither the Vienna Convention nor the Foreign Missions Act precludes attachment of properties once used for diplomatic purposes when, as here, the United States and the foreign nation no longer maintain formal diplomatic relations and the properties at issue are unoccupied and have fallen into disuse and disrepair. See id. at p. 5-8. Indeed, counsel alleges that the former embassy properties at issue in this case are currently in such a state of disuse and disrepair that the properties are not capable of being used for diplomatic purposes and therefore offer nothing more than investment value. See id at p. 6-9. Moreover, plaintiffs suggest that to the extent that the State Department might have either the legal obligation or the authority to assert custody and control over a foreign mission properties, the current state of disrepair of Iran's former embassy properties shows that the United States has completely abdicated its responsibility in this case. Accordingly, in plaintiffs' view, the properties should now, at a minimum, be subject to attachment under the commercial activities exception to the FSIA. See id at 7-10.

Plaintiffs also assert that, regardless of whether Iran's properties in this case might ordinarily be entitled to diplomatic protection or some other immunity from attachment, recent changes to the FSIA -- specifically, the sweeping changes enacted through § 1038 of the NDAA last year -- render diplomatic properties of state sponsors of terrorism subject to attachment and execution. Plaintiffs argue that for the purpose of attaching Iran's property, it does not matter that their action falls under the prior version of the state sponsor of terrorism exception, § 1605(a)(7), rather than § 1605A, because in plaintiffs' view, the new law simply strips away any immunity from attachment or execution that the diplomatic properties of terrorist nations might have otherwise enjoyed.

More than two months after the conclusion of briefing on this matter, plaintiffs filed a supplemental memorandum and exhibits in an apparent effort to bolster their position that the properties Iran once used for its embassy here in Washington are no longer immune from attachment. See Dk. # 37. The memorandum, which was filed without leave of the Court, summarizes plaintiffs' failed attempts to obtain information from the Department of State regarding the leasing and maintenance of the properties as issue, as well as other information concerning discussions between the United States and Iran regarding the status of Iran embassy properties.*fn4

The remainder of the supplemental memorandum simply summarizes the testimony provided in two supplemental exhibits. The first exhibit is a transcript of deposition testimony of a witness who claims that the former United States embassy in Tehran, Iran has been used as a school for Iran's Revolutionary Guards sometime within the last three years. See Dk. # 37 at p. 3 & Exh. F. The relevance of this testimony is not apparent and no explanation is proffered by plaintiffs' counsel. Perhaps plaintiff means to suggest that Iran is in material breach of its obligations under the Vienna Convention, and that therefore the United States is no longer obligated to protect Iran's former diplomatic properties here in the United States. The second exhibit included with the supplement is a transcript of deposition testimony of a witness who claims he is a construction worker who once worked on the buildings located on the properties now subject to plaintiffs' writs of attachment. See Dk. # 37 at p. 3 & Exh. G. The witness' testimony largely supports plaintiffs' assertions that former diplomatic properties are not currently in use and have fallen into various states of disrepair.*fn5

This Court will address each of the arguments of the parties in turn. Before proceeding to analysis of those arguments, however, the Court believes it is important to provide the legal and factual backdrop that is essential to an understanding of the issues involved in this dispute. A decade has passed since this Court first ruled, in the case of Flatow v. Islamic Republic of Iran, that the former embassy properties at issue here today are not subject to attachment and execution under the FSIA. Both plaintiffs and the United States have identified a number of developments in the law relating to this matter since that decision. While this Court is not convinced that there is has been any change in the law that would require a different outcome in this case, it is with sincere respect for the plaintiffs in this action, that this Court will briefly review the controlling legal authorities, as well as the key facts concerning diplomatic relations between the United States and Iran, in order to examine carefully whether the relief denied to the Flatows ten years ago should be available to the Bennetts today

Discussion of Legal and Factual Background Concerning the Former Iranian Embassy Properties here in Washington, D.C.

There are basically five sources of law that are central to the resolution this dispute. The first source of law that undergirds this whole matter is the Vienna Convention on Diplomatic Relations. The second is the Foreign Missions Act, which in certain critical respects serves to implement the United States' obligations under the Vienna Convention. The third source is the Foreign Sovereign Immunities Act, § § 1609, 1610, including the key amendments made pursuant to the Terrorism Risk Insurance Act, which furnishes a number of exceptions to the general rule that the property of a foreign sovereign is immune from attachment or execution. The fourth key source of law in this sensitive foreign relations matter is the Executive Branch's official actions in response to the breakdown in diplomatic relations with Iran. This source of legal authority includes both Executive Orders and statements issued by the United States to Iran regarding the status of its mission properties here in the United States. Fifth, and finally, this Court will review the few decisions of this Court and others that have addressed the issue of whether Iran's properties that are no longer being used by Iran for diplomatic purposes should now be subject to attachment in execution in satisfaction of court judgments. A review of all five of these sources demonstrates that the laws of the United States do not permit this Court to sustain plaintiffs' writs of attachment.

(1) The Vienna Convention

In 1972, the United States ratified the Vienna Convention on Diplomatic Relations. 23 U.S.T. 3227, T.I.A.S. No. 7502. Under the terms of that treaty, the United States, in its role as a receiving state of foreign missions, is obligated to protect and respect the premises of any foreign mission located within its sovereign territory. Article 22 of the Convention outlines the basic responsibilities of a receiving state with respect to the property of a foreign mission. That Article provides that the property of a foreign mission is "inviolable," and thus the receiving state is under a "special duty to take all appropriate steps to protect the premises of the mission against any intrusion or damage." Moreover, "[t]he premises of the mission, their furnishings and other property thereon and the means of transport of the mission shall be immune from search, requisition, attachment, or execution. Article 22(3) (emphasis added).

Article 45 of the Vienna Convention makes clear that the obligation to protect and respect the premises of a foreign mission survives even in cases in which diplomatic relations are broken off, or in cases in which the mission is permanently recalled, and even during instances of armed conflict. Article 45 states as follows

If diplomatic relations are broken off between two States, or if a mission is permanently or temporarily recalled:

(a) the receiving State must, even in case of armed conflict, respect and protect the premises of the mission, together with its property and archives;

(b) the sending State may entrust the custody of the premises of the mission, together with its property and archives, to a third State acceptable to the receiving State;

(c) the sending State may entrust the protection of its interests and those of its nationals to a third State acceptable to the receiving State.

Thus, even during periods in which the United States is experiencing an extremely strained or outright hostile relationship with a foreign nation, the United States remains obligated ...


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