Statutory interpretation - plain language reading of the Foreign Sovereign Immunities Act precludes terrorist victims from retribution.

• Author: Passafaro, Thomas E.

STATUTORY INTERPRETATION--Plain Language Reading of the Foreign Sovereign Immunities Act Precludes Terrorist Victims from Retribution--Rubin v. Islamic Republic of Iran, 830 F.3d 470 (7th Cir. 2016).

The Foreign Sovereign Immunities Act (FSIA) provides the foundation for procuring jurisdiction over foreign states, most importantly foreign state sponsors of terrorism, in the federal and state courts of the United States. (1) Plaintiffs can attach the assets of foreign state within the United States upon execution of a judgment, unless a statutory immunity provision applies. (2) In Rubin v. Islamic Republic of Iran, (3) the Seventh Circuit Court of Appeals contemplated whether the execution and attachment of Iranian assets in possession of the University of Chicago was enforceable. (4) The Seventh Circuit held that the Iranian assets, loaned to the University of Chicago's Oriental Institute, could not be used to execute their judgment because, despite being used for commercial activity in the United States, the Persepolis collection was not placed into commercial activity by Iran itself, thus making it immune to attachment and execution. (5) In 1937, University Chicago's Oriental Institute, an archaeology museum, received the Persepolis Collection from Iran for research purposes. (6) The terms of the loan agreement between Iran and the University of Chicago were that the University would retain a small portion of the artifacts once the research was completed and upon completion, the remainder would be returned to Iran. (7) Despite the additions and donations of several other related artifacts from Iran and other countries throughout the 1980s and 1990s, the Persepolis collection remained with the Oriental Institute for cataloguing purposes and was never returned to Iran. (8)

On September 4, 1997, eight U.S. students were gravely injured by an explosion in Jerusalem caused by three suicide bombers with ties to Hamas. (9) On September 9, 2000, the victims of the suicide bombing in Jerusalem along with fellow family members filed a civil action suit against Iran in the United States District Court of the District of Columbia. (10) The plaintiffs argued the Iranian government was subject to suit under the Foreign Sovereign Immunities Act as a state sponsor of terrorism as it provided Hamas with material support and resources to both the organization and its operatives. (11) On September 10, 2003, the survivors were awarded a USD 71,500,000.00 judgment for punitive and compensatory damages based on the Iranian government's sponsorship of the terrorist attack. (12)

The plaintiffs took immediate action in an effort to collect on their judgment but instead underwent a decade's worth of litigation as the victims were denied several writs of attachment on bank accounts and artifacts in the possession of the Iranian government. (13) In 2011, the victims registered their judgment in Illinois in an attempt to attach the Persepolis Collection but the Northern District Court of Illinois granted the Iranian government's motion for summary judgment. (14) The court held the artifacts fell within the scope of immunity and were not subject to execution because they were not placed into commercial activity by Iran. (15) On August 23, 2015, the victims filed an appeal in the Seventh Circuit Court of Appeals, who affirmed the district court's decision and held that the Iranian assets were immune from attachment. (16)

Prior to the Foreign Sovereign Immunities Act, foreign states were immune from jurisdiction within the United States solely due to the United States' desire to maintain positive relations with other countries. (17) With the codification of the Foreign Sovereign Immunities Act, the United States offered its citizens an opportunity to bring suit against a foreign nation in the courts of the United States. (18) Despite this, in order to procure jurisdiction over a foreign state, a provision of the Foreign Sovereign Immunities Act must authorize the plaintiff to do so. (19) Among the most common provisions are the terrorism and commercial activities exceptions. (20)

The terrorism exception is one of, if not the most widely litigated issue under the Foreign Sovereign Immunities Act. (21) The terrorism exception permits a plaintiff, or group of plaintiffs, to sue a state sponsor of terrorism. (22) Upon its enactment, an important case in employing this exception was Alejandre v. Republic of Cuba, (23) founding the basis to obtain jurisdiction over a state sponsor of terrorism. (24) In Alejandre, Miami-based United States civilians were flying to Russia on a humanitarian mission and were consequently shot down by the Cuban military without cause. (25) Alejandre illustrated the necessary factors for a plaintiff to bring suit against a foreign nation, designated as a state sponsor of terrorism, under the terrorism exception of the Foreign Sovereign Immunities Act. (26) The factors established by the Alejandre court are that: "(1) the U.S. must have designated the foreign state as a state sponsor of terrorism pursuant to [...] the Export Administration Act of 1979; (2) the act must have occurred outside the foreign state; and (3) the claimants and victims must have been U.S. nationals at the time the acts occurred." (27)

Upon executions of a judgment, specifically under the terrorism exception, plaintiffs can attach the property of the sovereign defendant. (28) One of the most common exceptions to immunity is the commercial activities exception, which requires that a sovereign nation place a particular piece of property in commercial use in the United States, thus qualifying that piece of property for attachment for the purposes of executing a judgment. (29) The case of First National City Bank v. Banco El Comercio Exterior De Cuba (30) established the initial factors in determining whether or not a piece of property was placed into commercial activity by creating the "Bancec Doctrine", which allowed for the attachment of property only if it is owned by that foreign state. (31) In 2008, the enactment of state-sponsored terrorism exception abrogated the "Bancec Doctrine" by creating a freestanding exception to immunity for state sponsors of terrorism. (32) Following the 2008 amendments, a judgment against a foreign state could now enable plaintiffs to attach properties owned not only by the foreign state, but by a "judicially separate agency or instrumentality" of that state as well. (33)

In Rubin v. Islamic Republic of Islam, (34) the Seventh Circuit Court of Appeals cogitated whether or not Iranian assets, loaned to the University of Chicago for research purposes, were subject to attachment for purposes of executing the plaintiffs' judgment. (35) The Seventh Circuit Court of Appeals proceeded in favor of a plain language reading of the Foreign Sovereign Immunities Act and its terrorism exception. (36) The Court determined that the terrorism exception is not freestanding in nature. (37) Specifically, the language of the terrorism exception refers to immunity of property "as provided within in this section," indicating the plaintiffs must satisfy another provision within the statute, such as the commercial activity exception. (38)

Moreover, the Court also distinguished the Iranian assets fell within immunity despite the plaintiffs contention they satisfied the "commercial activity" exception. (39) The Court analyzed what a "commercial activity" was and determined its applicability was limited to instances where the sovereign must places the asset into commercial activity itself. (40) The dissent in Rubin rebutted the plain language analysis of the commercial activity exception, finding that it would be difficult to attribute Congressional intent as being so solicitous towards state sponsors of terrorism. (41) The purpose behind the implementation of special provisions in the Foreign Sovereign Immunities Act, such as the state-sponsored terrorism exception, was to benefit victims of terrorism and "facilitate execution of judgments against any property owned by state sponsors of terrorism." (42)

The Seventh Circuit Court of Appeals incorrectly affirmed the district court's decision in finding that the Iranian assets displayed by the University of Chicago were immune from attachment. (43) By affirming this decision, the Court preserved the idea that immunity was no longer a courtesy afforded to foreign states, especially when there are victims of their actions within the United States. (44) Furthermore, the Court disregarded the freestanding nature of the state sponsored terrorism exception, overruling circuit precedent. (45)

The Court inaccurately determined that ambiguous language of the terrorism exception be read without incorporating congressional intent and thus making the Iranian assets immune to execution. (46) In their analysis of the statute, the Court properly interpreted the ambiguous language of the exceptions as they are written but failed to weigh what previous cases within the jurisdiction considered under similar circumstances. (47) Despite the Court's claim that the language should be read as is, thus establishing their own legislative intent in regards to the statute, the ambiguous language should not require the plaintiffs to satisfy another provision within the statute to execute on their judgment. (48) Despite the plaintiffs weak argument that the ambiguous language of the statute should only apply to its non-substantive rules, the provision should be read with consideration of legislative intent. (49) The purpose behind the statute's enactment was to allow victims, such as the ones in Rubin, a means of remedy when the evidence clearly suggests Iranian officials materially supported Hamas solely for the purpose of carrying out the heinous act that led to the plaintiffs' grievous injuries. (50)

The Court correctly affirmed that the defendant's failed to meet the commercial activity exception, as...