The Supreme Court next week will consider whether Congress went too far in mandating that billions of dollars in Iranian assets seized in the United States go to Americans who suffered from state-sponsored terrorism.
The beneficiaries would be 1,300 Americans who were wounded by or are survivors of those killed in terrorist attacks, kidnappings and bombings guided by the Iranian government, the plaintiff group says in court documents.
“Those terrorist attacks include the 1983 Beirut Marine Barracks Bombing, in which suicide bombers detonated a truck bomb and unleashed the largest non-nuclear explosion that had ever been detonated on the face of the earth, killing 241 American servicemen, and wounding dozens more,” the plaintiffs told the court.
But even if the Supreme Court ultimately rules in their favor and against the central bank of Iran, not all of the terrorism victims will benefit.
Dozens of those whose names are etched into the memorial at Camp Lejeune, N.C., honoring the peacekeeping forces who died are not represented in the lawsuits, and they will receive nothing.
“Despite their equal and shared sacrifice, some injured servicemembers and families and other victims stand to receive millions of dollars in compensation, while many others are unlikely to ever receive so much as a penny,” lawyers for some of the victims’ families wrote in an unsuccessful bid to intervene in the current case. “This inequitable arrangement should not — and need not — stand.”
Representatives of 173 of the 241 killed in Beirut are included in the judgment at issue in the Supreme Court case.
Some of the missing families appear not to want any part of the litigation, but R. Paul Hart and Jeremy S. McKenzie of Savannah, Ga., are representing 11 estates that do. Along with other lawyers, they tracked down families that were not part of the successful lawsuits in D.C. and New York.
Their clients have just started the years-long process of suing the Islamic Republic of Iran. The problem is that there have already been judgments of nearly $10 billion levied against Iran, while the assets identified in America that could be for compensation would cover only a fraction of that amount.
If the Supreme Court rejects the Iranian bank’s objections, the seized funds will be distributed quickly. “The money will be gone in short order,” said Hart.
The justices are not deciding who should be compensated but whether anyone should.
President Obama froze Iranian assets in this country in 2012. When those who had secured judgments against Iran learned of bonds held by the government in a New York bank, they went after them. And Congress passed a law in the midst of the litigation that essentially said the victims were entitled to the funds.
In Bank Markazi v. Peterson, the bank says the law violates the separation of powers doctrine: Congress cannot dictate the outcome of a federal lawsuit. But a unanimous panel of the U.S. Court of Appeals for the 2nd Circuit disagreed, saying that the law did not intrude on the central work of the courts.
The justices might be relieved that they are being called upon to decide the constitutional issue rather than who should get the money. All of the families suffered the same numbing losses, and it would be difficult to portray those who pursued the case for more than a decade as greedy, or those who only recently filed suit as opportunistic.
Deborah Peterson of Arlington is the lead plaintiff among those who won judgments against Iran, and she said in 2003 that she intended to avenge the death of her brother, 20-year-old Marine Cpl. James Knipple.
“I want Iran to hurt,” she said at the beginning of testimony before U.S. District Judge Royce C. Lamberth. “They made us hurt.”
Years of litigation and work paid off when courts found that Iran played a role in the bombing and years later ruled that the identified Iranian assets could be used to partially cover the judgments the families had received. The so-called Peterson plaintiffs said it would be unfair for others to jump in when they were on the brink of success.
Those lawyers were reluctant to discuss the case but opposed the proposed intervenors in a court filing.
“Over the past 13-plus years, while plaintiffs were expending many millions of dollars in attorney time and millions more in expenses in pursuit of their judgments against Iran and in connection with efforts to enforce those judgments, the proposed intervenors have sat on their rights,” the lawyers said.
U.S. District Judge Katherine Forrest agreed it would be “manifestly unjust’ to the Peterson plaintiffs to allow others into the suit at such a late date.
John Relvas, the lead plaintiff among the intervenors, said what he finds unjust is that not all are represented. “There are 241 names on the memorial,” he said in an interview. “They should all be included.”
Relvas, like Peterson, also lost a brother in the attack. Rui Relvas had always wanted to be a Marine — “it’s all he ever talked about, back from the time we played G.I. Joe together,” John Relvas said — and followed his brother into service as soon as he graduated from high school.
John Relvas was stationed in California; Rui Relvas went to Beirut.
In his affidavit, John Relvas said he identified the body: “My brother came home in pieces.” He knew it was Rui only because of a scar on his brother’s knee from a childhood bicycle accident.
Relvas said he was never contacted to join the Peterson suit or any others, and knew nothing about the litigation. He thought it was a prank when McKenzie and Hart called him. “Don’t you think we would have wanted to be part of it?” he asked.
The Relvas plaintiffs have dropped their appeal of Forrest’s decision and are in the process of seeking judgments against Iran in Lamberth’s courtroom. Iran has never responded or defended itself in any of the lawsuits.
Then another search for Iranian assets would commence. Or Hart and McKenzie hope that Congress, which lately has shown an interest in compensating terrorism victims, might find a solution for the new plaintiffs.