Bennett v. Bank Melli

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law:
  • Date Filed: 08-26-2015
  • Case #: 13-15442; 13-16100
  • Judge(s)/Court Below: Circuit Judge Kozinski for the Court; Circuit Judge Graber and Senior District Judge Benson
  • Full Text Opinion

Four groups of creditors obtained judgments in U.S. Courts against the Republic of Iran based on attacks that took place between 1990 and 2002. Although these were default judgments, it is not contested that they are valid and that Iran owes the creditors a large sum of money. Congress created two statutes to help victims of terrorism receive their judgments: Section 201(a) of the Terrorism Risk Insurance Act (TRIA), and 28 U.S.C. §1610(g). Both statutes make judgments for victims of terrorist attacks executable despite blocked assets that have been seized or frozen by the federal government. In 2007, the Department of Treasury put a block on Iranian assets being transferred back to Iran. The creditors used this opportunity to file suit against Bank Melli (Iran’s National Bank) seeking access to the money from the blocked Iranian assets. Bank Melli argues that the two statutes do not set aside the sovereign immunity that should be given to the terrorist state’s instrumentalities that are not an alter ego to the state. The district court denied Bank Melli’s motion to dismiss. The Ninth Circuit held that in looking at the language of Section 201(a) of the TRIA, the blocked assets of the terrorist party include the assets of any agency or instrumentality of the terrorist party, was referring to all instrumentalities. Section 1610(g) makes it even clearer that determining whether the asset is an alter ego of the state is irrelevant. The Panel concluded that Section 201(a) of the TRIA and 28 U.S.C. §1610(g) clearly permitted victims of terrorism to collect money owed from instrumentalities from the state that committed the act of terrorism. There was nothing in Federal Rule of Civil Procedure 19, the Foreign Sovereign Immunities Act, or retroactivity by the Supreme Court that would say otherwise. AFFIRMED.

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