By Laurie Asseo
Associated Press Writer
Friday, June 26, 1998; 10:39 a.m. EDT

WASHINGTON (AP) -- The Supreme Court today refused to force the government to help reimburse a group of U.S. citizens who lost property in Iran during that country's 1979 revolution.

The court, without comment, turned away arguments that because a U.S.-Iran agreement resulted in only partial payment for the losses, the U.S. government should have to make up the rest.

The lawsuit was filed by individuals, companies and two universities that lost property or money after the American Embassy in Tehran was seized and U.S. personnel were taken hostage in November 1979.

In 1990, Iran agreed to pay $105 million to the United States, of which $50 million was set aside to resolve claims by U.S. citizens of less than $250,000 each.

The Foreign Claims Settlement Commission, authorized by Congress to resolve those small claims, entered 1,000 awards totaling $86 million in principal and interest. Because that exceeded the $50 million set aside, everyone whose claim was upheld received the full amount of principal and about one-third of the interest awarded.

Among those whose claims were upheld, 20 individuals and corporations and two universities -- the University of Northern Colorado and the University of Pittsburgh -- sued the government in the Court of Federal Claims.

They said the government's decision to settle their claims against Iran without their consent amounted to a taking of their property without compensation, and asked that the government be forced to pay the rest of the interest.

The claims court ruled for the government, and the U.S. Court of Appeals for the Federal Circuit upheld that decision last December. The government has the authority to settle such claims, the appeals court said, adding that there was no reason to believe the people would have done as well or better on their own.

The appeal acted on today said that when the government settles citizens' claims against another nation, courts should decide whether the citizens got fair payment.

Government lawyers said such settlements are an established international practice that gave the citizens a ``swifter and surer means of recovering on their claims.''

The case is Gurney vs. U.S., 97-1440.