From the Wall Street Journal:
WASHINGTON—The Supreme Court on Monday asked the federal government to weigh in on judgments awarding nearly $2 billion in frozen Iranian banking assets to terrorism victims.
The request, made in a brief court order, puts off for now legal efforts to compel payments to more than 1,300 American victims or surviving family members who won civil judgments over several years that held Iran liable for sponsoring terrorist attacks.
The court is considering an appeal by Bank Markazi, Iran’s central bank, which held an interest in the frozen funds. The bank has challenged lower U.S. court rulings that allowed the money to be turned over.
The attacks included the 1983 Marine barracks bombing in Beirut and the 1996 Khobar Towers bombing in Saudi Arabia.
The court judgments are to compensate victims of terrorist attacks Iran’s government sponsored in the past, and are separate from sanctions intended to change Tehran’s future behavior. The high court’s request comes as Iran and six world powers reached a nuclear-framework agreement to deter Iran from acquiring a nuclear weapon.
The Iranian bank argued in its petition to the Supreme Court that Congress acted improperly by passing legislation in 2012 making changes in the law specifically to allow the victims to seize the money. The bank argued lawmakers violated the separation of powers by legislating the outcome of a court case.
The victims urged the Supreme Court to reject the appeal, saying past high court precedent made clear that Congress could fundamentally change the governing law that is applicable to a pending case.
The bank said in its petition that the funds were part of its foreign-currency reserves. The victims said they learned in 2008 the money was in a Citibank account. According to court documents, the Citi account was maintained by a Luxembourg financial intermediary that did business with an Italian bank that in turn did business with Iran’s central bank.
The money is currently being supervised by a court-appointed trustee.
The U.S. Solicitor General will file a brief in the case in the coming months and then the Supreme Court will decide whether to take up the case.