Rubin and Exceptions to Attachment Immunity

Anna Rasmussen
Vol. 39 Executive Editor

Rubin et al. v. Islamic Republic of Iran et al. is a recent case about the ability of U.S. nationals to enforce a judgement against parties who would normally be afforded immunity. In dealing with foreign nations, the U.S. aims to respect “the careful balance between respecting the immunity historically afforded to foreign sovereigns and holding them accountable.”[1] Under the Foreign Sovereign Immunities Act of 1976 (FSIA), in general, foreign states are granted immunity from being subject to U.S. jurisdiction,[2] and any property of foreign states that is in the U.S. is granted immunity from “attachment arrest and execution” except under express exception.[3] In this case, the petitioners currently hold a judgement against the Islamic Republic of Iran for damages resulting from three suicide bombings carried out by Hamas on September 4, 1977.[4] The attack left five people dead and almost two-hundred injured.[5] The petitioners brought suit in the District Court for the District of Columbia as U.S. citizens who were either injured or who had close relatives who were injured in the attack.[6] While foreign states typically enjoy immunity, an exception is provided where the foreign state is a “state sponsor of terrorism,” and the plaintiff was injured by these acts.[7] The District Court entered a $71.5 million default judgement against Iran in favor of the petitioners after Iran failed to appear.[8] Iran did not pay the judgement, so the petitioners sought ways to enforce the judgement.[9] The University of Chicago’s Oriental Institute houses Iranian assets known as the Persepolis Collection.[10] The collection contains around 30,000 clay tablets and fragments with ancient writings that were discovered in the 1930s during an excavation of the ancient city of Persepolis.[11] The petitioners sought to attach and execute the judgement against the Persepolis Collection.[12] They argue that FSIA §1610(g) renders the Iranian assets subject to attachment and execution.[13] The District Court for the Northern District of Illinois ruled against the petitioners based on its interpretation of FSIA §1610(g), and the Seventh Circuit affirmed. The Supreme Court granted certiorari because the federal Courts of Appeal were split regarding their interpretation of §1610(g).[14] Before 2008, FSIA did not have any express provisions dealing with when a foreign state could be held liable for a judgement against it. In First Nat. City Bank v. Banco Para el Comercio Exterior de Cuba, 462 U.S. 611 (1983), the Court stated that “duly created instrumentalities of a foreign state are to be accorded a presumption of independent status.”[15] However, the Court recognized that there should be exceptions to this rule yet “announce[d] no mechanical formula for determining the circumstances under which the normally separate juridical status of a government instrumentality is to be disregarded.”[16] Various Courts of Appeal developed what became known as the Bancec factors, which were then incorporated into the FSIA §1610(g).[17] The text of the FSIA §1610(g)(1) reads: “In general. [T]he property of a foreign state against which a judgment is entered under section 1605A, and the property of an agency or instrumentality of such a state, including property that is a separate juridical entity or is an interest held directly or indirectly in a separate juridical entity, is subject to attachment in aid of execution, and execution, upon that judgment as provided in this section…“[18]

The question at issue is whether §1610(g) allows a party with a judgement under §1605A to attach and execute against any of the foreign state’s property or whether the property must be independently deprived of immunity elsewhere in §1610.[19] The phrase at issue is “provided in this section.”[20] If the phrase refers to the whole of §1610, then the property must be exempted from the grant of immunity before it can be attached and executed.[21] Petitioners argued that the phrase does not refer to §1610 as a whole but instead refers to a specific provision within §1610 or the National Defense Authorization Act.[22] They also suggested that the phrase could be a drafting error.[23] Looking at the text of the statute, comparing it to other statutes, applying the interpretive canon against superfluity, and examining historical practice, the Court held that “as provided in this section” refers to §1610 as a whole. Therefore, §1610(g) only allows for the attachment and execution of property that is exempted from immunity elsewhere in §1610.[24]

This holding severely limits the ability of parties with judgements against foreign states to effectively enforce them. Since courts have traditionally “deferred to the decisions of the political branches…on whether to take jurisdiction over actions against foreign sovereigns,”[25] Congress could conceivably take action to change the provision to allow greater exceptions to immunity in the future.

[1] Rubin v. Islamic Republic of Iran, 138 S. Ct. 816, 821 (2018) [2] 28 U.S.C. §1604 [3] 28 U.S.C. §1609 [4] Rubin at 820 [5] Id. [6] Id. [7] In the original suit, the courts were able to exert jurisdiction over Iran under 28 U.S.C. §1605(a)(7). In 2008, Congress replaced §1605(a)(7) with §1605A which is a more expansive provision for states that are deemed “state sponsors of terrorism.” [8] Rubin at 820 [9] Id. at 821 [10] Id. [11] Id. [12] Id. [13] Id. [14] Id. [15] First Nat. City Bank at 627 [16] Id. at 633 [17] Rubin at 818 [18] 28 U.S.C. §1610(g)(1) [19] Rubin at 823 [20] Id. [21] Id. [22] Id. at 825 [23] Id. 826 [24] Id. at 823­–25 [25] Id. at 822 (quoting Verlinden B.V. v. Cent. Bank of Nig., 461 U.S. 480, 486 (1983))