hear argument next in case sixteen five thirty four reuben vs the islamic republic of iran sperling is the chief justice and may please the court in two thousand and eight congress comprehensi overhauled the terrorism exception to foreign sovereign immunity to close gaps that had for years allowed foreign terrorist states to thumb their noses at us judgments finding them liable for acts of terrorism on their victims were drawn into a long bitter and often futile search for scarce assets that would be subject to execution under the exceedingly narrow commercial exception for some immunity the centerpiece of that legislation section six hundred ten g that provision provides that american terrorism victims can execute their judgments upon the property of a foreign state that is subject is provided section as provided in this section the question is what that what that provision means the respondents would have the court delete the three words between the word execution and the words as provided in this section what it actually says is that the property is subject to execution upon that judgment as provided in this section we know what congress wanted to it's well the acis it would be available but he didn't say anything and a word about a meeting well there's two questions or doesn't see anything about immunity but those are magic words it does say that the property is subject execution magic words on jury and b is sixteen ten and a and b congress knew how to regularly to say property is not or is subject immune from attachment and put it you something very different embassy so on the uniform on the uniforms that the people in the embassy where wrong on the papers that the ambassador keeps in his desk if in fact you read as provided in th section the answer is no if you read it to include as has to be commercial are right under your reading are those three words must mean something else can't they do it they cannot why not subsection section sixteen zero nine protects military assets and central bank acts as it congress when they enacted six hundred ten g they did not completely abrogate foreign sovereign immunity for terrorist states they wanted to provide a remedy for the victims they wanted to punish and deter the terrorist states for the same time kind of recognized that iran and north korea syria sudan these are sovereign states and they're entitled to a bare minimum of sovereign immunity and kind of retain that their minimum by protecting consensually sovereign assets while making everything else of its execution what is provided in the section i am i right you think it incorporates only procedural requirements you can have execution upon the property upon that judgment as provided in this section as providing the section modifies the judgment upon that judgment and it refers to the section is section sixteen zero five a which is section mentioned in the sentence is referring back to the section six you know five it was a couple lines above in the same sentence and what it says is that the judgment and that section six hundred ten g which provides sweeping remedies for terrorism victims is only a political to those who hold judgments entered into the statutory cause of action of sixteen five a day not available to other plaintiffs dignity of terrorists they allowed punitive damages the expected us to be enforced they allowed a prejudgment lien of list pendants to attach to all sovereign all of the states property that is subject to execution under six hundred ten that including property of any party that the plaintiff identifies as being controlled by by that terrorist state so  veil piercing mechanism as respondents claim there's no reason to mention the probably the foreign state you don't need to pierce the veil to leave the property of the of the judgement that are terrorist state you just go straight for the property and if you have a judgment against him from intel be i'm sorry i thought that the university of chicago had raised an interesting argument that the definition of foreign state in the statute includes by definition agency or instrumentality of a foreign state so that the reference to foreign state that you're relying upon does include the concept of piercing the corporate veil in its very definition well that would that would that itself would abrogate the rationale that university well not quite because what i mean this provision deals directly in the plaintiffs in the pants case and in the others that have found against pla at least three cases where a class of plaintiffs were found not to be in a sufficiently tied relationship to the foreign state and the plaintiffs there couldn't recover so there was a real issue this was addressing the fact that they were subsidiaries and agencies of foreign state who had commercial property and it wasn't being made available to plaintiffs so the question would be to ask the respondent why middle east that the jews are free and they can go back to israel palestine the temple that letter exists and persia persian letter and iran has centered around the world now in view they happen people of what looked at and if it comes to united states you can see that is that you that's your view of it because if it is of course if congress knew about it then they might have had a general idea given the nature of the stuff in chicago in twenty two u s c twenty four fifty nine congress provided very specific and limited immunity for culturally significant objects being brought to the united culturally significant objects being brought to the united states for display or exhibition there is a very specific immunity there that the that somebody want to bring in that that property those exhibit can apply to the state department in advance and receive a letter interest and even to the extent that they do that doesn't mean that the court should not be able to transfer title to whatever party would be ready to pay the price and we think it would be iran by the way if the court we construe the statute as co think as we read it congress would finally i mean iran would finally pay attention to a judgment and they would say we're get we're about to lose our our our artifacts what w photographing cleaning of these of these are the facts and university of chicago does not assert an ownership interest they say that they're in the briefs they say they're trustees well since nine hundred eighty they've had the property because iran couldn't get it back for a big part of that time and for a big part of the time before that every now and then iran was asking when are you going to finish when you going to finish studying the things and they were not very forthcoming when this lawsuit was filed he moved into the expedited their study of the asses to realize that they might lose and now again university of chicago is really an amicus here they don't they have no interest in these assets they and to the extent that they do the court can protect that it can protect that interest in a sale well assuming you're right does that mean if you lose here you see iran will be able to repatriate the assets absolutely there's nothing in the way they did they did we lost we lost in the district court and there was another collection of iran owned assets and on the eve of the the argument in the court of appeals they were shipped back to iran after the court it denied our motions they but but they were shipped back to iran and things in the united states i mean it seems to me so far the main difference between your interpretation and the elders saw it as a practical matter is that if you're right that private people will be able to take cultural ass from persia and sell them and ship them back to iraq and if they're right you will have to limit your recovery to commercial objects because that's what the other parts of the statute per pod well no that's not perhaps going to turn out to be relevant to decision which is the commercial use exception for property owned by the state that provision as a seventh circuit held requires now i just use for commercial activity yes they used by the foreign state and a number of courts of appeal have held as  of a commercial transaction between a state and private parties that are proceeds that are held in an account that are intended for the former state and the courts have said that's not commercial use property why not because it's the proceeds of a commercial transaction but because th have not yet been used by the foreign state for commercial activity they're just sitting in an account passively willing to be used but they haven't used yet this they could say we're going to put it in our general account seems like the treasury congress has to address well and those  i don't know what i'm saying is the practical difference between our construction and the response construction is not in to quiz it's all of these cases dealing with with passive bank accounts and there's another case in california where there was a judgment obtained by the ministry of defense of iran against a defense contractor and the court said the money paid by the ministry of defense that's not commercial use property because it hasn't been used by iran and there's you in yourself in this case that's who it is and that's all that they've left that's all this this proceeding below began in two thousand and three the terror attack in this case was in one thousand nine hundred seven a kind of them winning twenty years to enforce a judgment against iran iran does not pay judgments you know you know it's not argentina they can't afford to pay the judgment they just don't and they don't they don't care what the american courts say and congress finally said enough is enough and they said punitive damages and we're go a simple ownership test a simple ownership test when you start piercing bills and layers of bills that is not a simple ownership test might have been intend to be included in the that's how it was being addressed and finally what that what the statute does say the legislative history the house report says that although the subjects to execution any property in which the sea is a beneficial interest i not extend to diplomatic property so once congress is excluding specifically that narrow class of quintessentially sovereign property diplomatic property you know that it's extending to covers everything else there's no reason if it didn't cover commercial use property or non court sorry noncommercial use property there's no reason to specifically mention diplomatic property because obviously that's going to be included in noncommercial this applies to everything everything except diplomatic military and certain central bank assets the idea that congress would be concerned with affronting the dignity of the state sponsor of terrorism and would extend protection to their noncommercial assets for that reason to avoid an affront to their dignity is just preposterous you have any  immunity act and not one of them is the word immunity so that we're getting immunity here we're limiting immunity because again it's not aggregating it wholesale it's maintaining a skeletal remains of sovereign immunity because in section three or paragraph three the property of an agency or instrumentality of a foreign state against which a judgment has been entered under sixty five a is subject to execution it did not need to mention the property of the foreign state iran and the government both talk about how it had to mention the foreign city well it's true it had mention the foreign state because a judgment was entered against a foreign state but it does not need to thing a lot the property of the foreign state if all this w the veil piercing mechanism it doesn't work it doesn't you cannot pierce the veil of a company or country to reach the probably the country owns directly and i'll just point out that none of the other provisions of six hundred ten work with either said that the provision was designed to eliminate many of the barriers which were prevented us citizens from collecting on court ordered damages he then said it does this by changing the legal standard of the bank doctrine so that was the way in which this exposed more asked more property to execution by terrorism plaintiffs in fact the petitioners position about the construction is wrong for four independently sufficient reasons one is the language the court is focused on as provided in this section this section is section sixteen ten that is the section of which g is a subsection so the phrase as provided in this section needs the petitioners have to satisfy the provisions of section sixteen ten which means that only property used for commercial activity in the united states can be seized and petitioners i think have just not come up with a plausible alternative account of what as provided in this section means but there's a second reason and it has to do with the difference between subsection g and the provisions of subsection sixteen ten that really do abrogate sovereign immunity the foreign saudi muzak says in section sixty nine that the property of foreign states in the us shall be immune from attachment except as provided in sixteenth and then the sub sections of sixteen ten say in terms one after another that certain property shall not be a new subsection he says that as does he as does d as the z subsection g contains no such language the relevant part of subsection g does not refer to him he added all and there's a reason for that the reason is that g is about bangkok and the bank a doctrine is not an immunity doctrine the court was very explicit about that where you do think agree with him don't you that the property of a foreign state in g one is it is a strong indication at least that it is not limited to overturning the ban check decision no i don't agree with that mr chief justice i think what's going on there is congress wanted to make it very clear that bangkok was no longer to no longer going to be a barrier in these cases and so it said property of the state property of agencies property vince mentalities property of separate or ridicule and of these interests and separate your vehicle and these all of these things are in the same basket and all of them are subject to attachment execution i think that's why you have  state itself but the way the section is written property of the state including property that is in a separate through decline of the or is an interest held directly or indirectly in a separate trickle entity what you see in the legislative history is a lot of concern that state judgment debtors would be arranging their assets in ways that would distance themselves from ownership is it the case there on that particular point i was trying to work out  know that isn't our money that's the bank's money and we're just the beneficial out of that money and bank check might have said yes that's right it's not their money it's an agency it's an agent money i'll say two things to that all of us are just this prior i think that the bank criteria are not very clear the court deliberately left the criteria bay and i think congress was concerned about that situation i think that's why you see this language in one that really tries to be comprehensive and cover every base but i think you don't get out of g one is anything about immunity because even applies to separate your  ones governing the property the ford state well i think the certain action of the city of justice our actions to execute judgments under sixteen zero five a this is a special provision to make it easier for terrorism plaintiffs get assets it doesn't apply to ordinary judgment plaintiffs and i think that's the that's the property it's referring to this is really was intended to make it much easier for the plaintiffs who have terrorism based judgments to get their hands on assets but only those plaintiffs i think those are the actions and that's why it judgement entered under sixteen zero five a but that doesn't mean that the rest of the section does not apply in fact it says the rest of the section does apply upon as as provide third is this the petitioners position really would nullify a decision congress made at the very same time it acted sixteen ten june two thousand and eight this is we go through this on page twenty five and twenty six of our brief this is the statute that added subsection g also created sixteen zero five the cause of action that the remedy that petitioners invoke that statute then amended the office i to say to parties like petitioners who are seeking to execute a sixteen zero five a judgment must show that the property they want to seize is used for commercial activity the united states that same statute said that it said that by inserting sixteen zero five a day into subsection day section you go to section subsection a subsection a seven says you can execute a sixty no five a judgment provided you can show that the property is used for commercial activity in the united states that's what that statute does then the next provision or a few  later in the statute really it's not even the next provision sets up an x subsection g so as petitioners would would have it congress created this remedy provided that if you wan execute a judgment based on this remedy you go to subsection a and you shall get the proper your season is used for commercial purpose commercial activity and it states and then immediately congress said oh never mind you know official commercial activity that's petition or story that's petitioners account of the significance of sixteen dangi and i think there's just no way to read congress's actions that just does not is not a plausible account of a congress might have been doing and there's really a fourth reason as well and it has to do with how central the commercial activity limit is to the fs i and the foreign sovereign immunity generally the principle at stake here is the principle that commercial property may sometimes be subject to seizure but noncommercial property is not and that principle is has the deepest roots in u s law and international law it's actually in dissipated by chief justice marshall's opinion in the schooner exchange it was the un convention on muni's of states it was the holding of a recent decision of the international court of justice which would bar the seizure of as it happens a cultural center the i c j bar the seizure of a cultural center because the cultural center is noncommercial  that case actually involved the victims of nazi crimes so this is an extremely deeply rooted principle now that's not to say congress could not abrogate it of course congress could but the court said just last term and helmar it the case involving the venezuelan seizure of oil rings that the court is not going to assume that congress has made a quote in the court's words a radical departure from central principles like that one unless congress has made its determination very clear and here what's really very clear is the opposite that congress did not intend to override sovereign immunity and section sixteen tangy if the court has no further questions thank you  question has already been focused on today is it just can't be squared with the statutory text statute says that the property of these different entities is subject to execution quote as provided in this section but the way petitioners read it it would work exactly the same way if it said the exact opposite if it said that the property was subject to execution regardless of what is provided in the section and that just can't be right and then so second i think another thing that really drives home that there are misreading this law is that the way they read it it gives with one hand what it takes away with another so as my brother was explaining in congress at a g at the same time it added a seven and what a seven says is that these very same people victims of terrorism with judgments under sixteen zero five capital and it says th can execute against the property of a foreign state but only if it's used in commercial activity but the way they read g those people can defeat that limitation just by invoking a different subsection of the same statute to get commercial noncommercial property whatever that would render seven so we don't think that's right we also just don't think it really helps them i know you're saying that it explains why so the reason it's not right we explain this in just twenty four and twenty five of our brief it has to do with the language of six you know five big itself  judgment it's a judgment under six you know five big day regardless of what cause of action they happen to invoke i also think this doesn't really move the dial for them much because in practice in the minor an application of sixteen zero five big day when somebody gets jurisdiction they're also going to use the cause of action as petitions were dropped were describing is very powerful is directly on point punitive damages vicarious liability and so it's still be true that in the minor an application of she they would be read in the law to get with one hand what it takes away with the other and then the last thing i'd just like to mention here is about the united states competing interest in this case i mean obviously we have a very strong interest in combat in a state bonds or terrorism but we also have concerns in these cases about  reciprocal treatment of our own property abroad and i think particularly in light of those concerns which are quite weighty if congress was really going to take the step of allowing execution against property of a cultural and historic significance to another country and its people that would be a big deal and we not be the kind of thing you expect to see buried in a conforming amendment without remark well how about the cases the other cases he was talking about the ones with too i think it does help to some extent with with the breadth of the use in court commercial activity is that the way we read g once you if you have a judgment against the foreign state you can pierce the veil down through the agency or instrumentality and then you can go after the agency property under b three and b three does not require that the property be used in commercial activity it's enough that the instrumentality is engaged in commercial activity so you think those other courts wrong those are other than i believe the other decisions that he was talking about were interpreted in a seven not be three and so but as we understand it the statute works together with with all of it works sixteen ten you can pierce the veil and use a b procedures and c would apply do you could apply f could apply that want waive and so i think a natural way for congress to pick up all of those all of those procedures was to say that the property is subject to execution as provided in this section and so what congress did was to tether the extent of execution under this veil piercing provision so all the protections that are already baked in elsewhere in sixteen ten and those protections ensure you can't execute against the ancient persian artifacts like these so if there's no further questions you're asking the court to affirm thank you counsel  mr pearl and you have five minutes remaining private right of action under under section sixty five capital a lower teeth c applies only where the plaintiffs are u s nationals members of the military or government contractors where employees immunity waiver that's also in sixteen or five a day but subsection a six in a five capital lower case a applies where the claimant or the victim  limited to those who hold judgments under sixteen five a and the judgment that's available in the sixteen zero five a is a is the statutory judgment the provisions of six hundred ten eighty seven three apply where the judgment relates to a claim for which the foreign state is not immune under sixteen zero five a which is explicitly referring to the immunity exception and it's explicitly referring to the broader class of p thirty four i believe there was a case where visa had collected money for the bank melli a bank an iranian bank and was holding it because it because of the sanctions they could not return that could not pay that money on terrorism victims came and said we want to we want to force a judgment that money collected on behalf of bank nelly and visa filed in an interaction iran defended and they said you can't you cannot enforce your judgment under sixteen iran continues to maintain the i want to be three and i think that that's i mean that's you would have to say that you have to weed out of the three the limitation that you need a judgment against each incidence mentality for two possibly three again there's there's no way to read this through according to their construction to read it through and apply it now again just to make clear the point about the provider judgments provide in this section if you look at the other substantive provisions of sixteen ten they allowed to start with let's look at six in ten say the opening paragraph says that the property of a foreign state used a commercial activity united states shall not be immune from attachment or from execution upon a is separated from that phrase by a comma the words upon that judgement is providing the section do not contain a comma those words are meant to be read together and the as read in this section is modifying the word judgment s concerns about foreign about foreign foreign relations are misplaced the explicit purpose one of the explicit purposes of the foreign sovereign is act was to remove foreign sovereign immunity decisions from the executive branch and place with the courts that was for two reasons one that plaintiff's american plaintiffs were being treated unequally based on whatever policy consideration was relevant at the time and to the government was subject to foreign pressure so we to group to remove this pressure from the government congress placed this authority in the hands of the courts rather than the government thank you counsel cases submitted