secondly we submitted a law he cannot invoke the terrorism risk insurance act or trea as an exception to the ministry of defense is immunity from attachment because first trio does not apply on its own terms because the cuban judgment is not a plot asset within the meaning of section two a one a of that statute and secondly that when the law he received two point three million dollars of u s treasury he revocable a relinquish his rights to seek to attach those properties that are at issue in claims against the united states of a crisis that we have in front of us is whether or not you can even raise that relinquish other forms of under or other sanction instruments of the effects of federal regulations or other actions that affect individual rights under sanctions plants and i'm not understand that distinction and i think all i can say is at least counsel for the united states may be in a better position to line the court however tribunals have handled this issue with a link which meant i understand the first when the law his first supplemental brief that they received funds from the treasury we only got notice when the united states isn't negus briefless filed that relinquish may have been executed yes ma'am we have a general rule that  priest that was specifically requested by this court to adopt the united states position in this regard i'm normally mindful that appeals courts reluctant to have arguments of the meek imported automatically into the submissions of many parties i think the nature or the peculiar nature of the briefing schedule in arrangement in this case and the peculiar nature of the underlying issue may justify other proceedings for and i'm wondering whether or not that is she was away and it's been the first time it came up with when the united states intervened before the u s supreme court no your honor as i think the supreme court the assumption was one that ministry of defense attacked during the during the earlier appeal we as a spring court indicate inspir curiam opinion iran's ministry of defense to had not waved an before the district court or the prior panel the ministry of defense has earlier briefing to this court in italy focused exclusively on section sixteen tend to be under our typical right let me be clear your honor him of the we didn't raise the issue before this court that sixteen ten a should be applied here the bulk of the briefing before the will find your honour's that if we look at originally this was race first of all in the district court talking about raising it i was looking for the evidence as to how we analyze the core functions to us oh i'm sorry you're asking us it's been raised presumably then there would be a record in the district court from which we could make a judgment as to whether or not you meet the core functions test assuming the test we apply well there was some discussion in the district ministry would be appropriate but we would submit that the case law is very clear that a thorn in the histories is considered part of the essential sovereignty of a foreign state under section sixteen ten and we do not believe any further fact finding would be required on that ground and we do indicate that further fact finding might be required as to the legal consequence of section sixteen tenants application in this case and whether the cubic judgment is in fact being or intended for use for commercial activity in the united states that issue was before the district court the district court judge felt he did not have to rule on that issue so if there's going to be any remain and at least for a fact finding would only be on that issue w i think the law's very clear that as for iran's ministry of defense the status of our courts of appeal including the guard case and the rotor case that indicated that minister is foreign ministries are part of the essential sovereignty of a foreign state and are to be outsourced its national security to security or mercenary zation there is certainly no indication that that has occurred here i don't think there is a need for further fact finding to that degree i want to turn your attention to whether this judgment on the arbitration is really an issue before that you know i number one you know what  property that is it issuing claims against the united states before an international tribunal or that is subject of awards by such a tribunal was broadly stated by congress specifically to factually congress's goal to insulate the united states   there is a ruling against the rand from government that they have no rights and what they're claiming against the united states the tribunal that judgment would stand has nothing to in the sense that the united states is international law obligations are at stake and there is the potential for set off for any claim by iran against the united states in terms of whether iraq's ministry of defense can we see that this we pay t would graciously request this court's permission to have five minutes of rebuttal well to let me start out with with addressing the issues that have been raised by my  and then if time permits turn to the issue of other provisions of the foreign sovereign immunity is act which would allow a law to attach the judgment is there a dispute about whether or treasury to obtain a payment from the department of treasury in partial compensation of his compensatory damage judgment and received approximately two point three million dollars from the department of treasury pursuant to the regulations that were issued by the department of treasury to obtain partial compensation of his compensatory damages ward so the parties were certainly put on notice at that time that as a result of obtaining that compensatory i'm sorry obtaining that payment that mr a lot he relinquished any right to attach under the terrorism risk insurance act anything that doesn't apply or th more made i believe and in april which is why you know our answering briefly for point of two thousand and three your honor which is why in our answering brief we said we had made application as part of obtaining compensation is it as my recollection has as part of a taining excuse me as part of applying to the u s government for funds a la he was required to sign point out to the court that the district courts ruling with respect to that issue was with respect to mr flatow who at the time had already received payments the ministry of defense had argued before the district court that mr flatow had waived his right to pursue an attachment on the grounds that the cuban judgment was that issue that is what the district court determined in saying that it was not a tissue but that it had been regulated and therefore mr plato had waived his right under a nother provision of the relinquishment requirement mob did not appeal that aspect question i have really is a factual question here is it a legal question whether something is at issue and the other two to you know we believe that it would be a legal question your honor given the like eighty million dollars and i got something something three million dollars i guess so they have a claim against kubic and there also they have a parallel claim as i understand it against the united states that understanding of what they're arguing they don't so ok so that's their argument so now you have now if they were to prevail on that theory if they go after the you know if they are successful in the hague in pursuing a in effect what characterize interference with contract claim and they prevail normally in that kind of a situation i assume the united states would say well we don't owe you eighty million dollars if that's what  the tribunal were to award we owe you less than that because you got three million dollars out of cuba and they were rainy and would say in response to that now we did guess what united states court allowed mr de la he to come and take that three million dollars away so why doesn't that put at least within the concept of the  that the judgment is the property here right that's the property that issue at issue we don't the property that you are seeking to attack to correct the property in this know that property that judgment that three million dollars is also what is at issue in the hague by way of offset we don't believe that it would be at issue you ran or because it is not one of the states is does not involve the same subject matter has its claim against cuba well that's true and that is what it has it's an interference with contract it's a claim that the united states interfered with cubics performance of its contract and it wants the united states to compensate and it will offset against its eighty million dollar claim the three million dollars it's already recovered from cuba for its non perform  with their existing judgment unattached they're willing to set that off what if that three million dollars goes away because it's now been diverted from odds pockets into and maybe properly so mr law his pockets they wouldn't be and i doubt that they would be saying well we're going to go ahead and just ignore that i believe that's what iran would say but i think in terms of the legal analysis one should look at what the courts have said as to whether or not a asset is that issue for purposes of relinquishment under the t r a and i would refer the court to the fourth circuit's decision in heck never says the islamic republic of iran which is cited in our case was diplomatic property was before the iran u s claims tried to know was whether or not that tribunals had taken jurisdiction over the client and in this case and as the district court in making its ruling with respect to the flight zero plaintiffs that the human judgment was not at issue and i think we need to the analysis on that the analysis is it's not raised you have caught it because it is a different subject matter has a different object and therefore it is distinct iran's claims against the u s harvesting from its claims against cuba and therefore we believe that district court's ruling is correct relinquish his right to attach under the terrorism risk insurance act we believe that that act provide sufficient basis to uphold the attachment of the cubic judgment and under the t r i a section two a one mr ally as the claimant with a claim against iran can attach the assets of either and it's the foreign state itself or an agency or iraq it does not matter whether or not you characterize modest either being the state of iran or an agency or instrumentality the force of section two a line a of the t r a still has its effect that the executive order that was issued by president carter in one nine hundred seventy nine that's executive order twelve one seven zero entitled blocking iranian government property was a political to the cubic judgment and as well as the implementing regulations of that executive order section five thirty five point two all one those are blocking regulations for property of the iranian iran and we believe as iran  those regulations and the executive order still are in effect so that the cubic judgment is blocked and therefore can be attached by mr allotting in fact this court in it prior opinion in this case which was not questioned by the supreme court previously found that the cuban judgment does come under section five thirty five point two all one of the treasury department regulations those are the regulations implementing the executive order blocking iranian government property therefore we believe that this court when you go through the says has already determined that the cubic judgment is blocked property and therefore subject to attachment now ma does cite to a decisions out of the southern district of new york  involving property thing that entered the united states in the one nine hundred ninety s that was transferred by iran to certain banks iranian banks in the united states in those decisions  the court held that because the funds from iran came into the united states after the return of our hostages in fact a few days and therefore the cubic judgment remains blocked under the president's executive order and the regulations so we believe that decision cited by modern sorry model has intentionally come into the jurisdiction of the united states pursuing a commercial arbitration award to be confirmed has engaged in commercial activity as morning runners and was yelling from the department of justice here today representing united states amoco security i'd like to begin this morning honors by saying that the united states has the utmost sympathy for the ally he family and that our participation in this matter in no way is meant to detract from the government's strong condemnation of iran's political sass a nation of cyrus a lot why are the governments only participating in this matter well your honor we were not aware of this case while it was pending before this panel we only became aware of the case after the court issued its opinion the government has important interests its own sovereign interests before the iran u s claims tribunal and also an interest in protecting the sovereign in perspective or in states in united states quirks in weren't states could somehow attach your back to the united states interests abroad if we were to let this it's all of those interests your honor we certainly do have a very strong interest in the status of your own u s claims of the status of the run us claims tribunal proceeding iran has made a claim against the united states concerning the one in the same contract that was the subject of the dispute between cuba and ministry and the united states his position in the tribunals well your honor the arbitration is not at issue however the amount that was awarded to iran is very much at issue and i'd like to speak to that if i may mr a lot you would like to urge this court to construe at issue very narrowly to mean subject to a claim before the tribunal if it's not subject to a claim according to mr law he then it's not an issue before the tribunal that's not a correct interpretation of the statute and we know that both from the statutory language and from the policies undermine congress as an act meant of this relinquishment provision what i'd like to do is call the court's attention to the exact language in the statute the statute requires a relinquishment of and now i'm quoting all rights to execute against or attach property that is at issue in claims against the united states before an international tribunal or that is the subject of awards before subject and before the tribunal now it's the contrast i'd like to make between at issue in claims and the subject of awards the reason for the distinction in the language is because while claim the still life in the tribunal the scope of the united states as potential liability to iran is indetermin award because at that point the united states has liability has become fixed and just because some property might relate to an award it no longer matters because the united states could not be liable could conceivably for property that relates to an award again because also to mean in question which is a significantly broader concept than specifically in dispute in addition it's the contrast between the language in the statute itself at issue and subject to as your honor knows under basic canons of statutory stablish the system that that provided a quid pro quo agreement of individuals with judgments against iran got an opportunity to choose to accept a definite payment in exchange for giving up something and in this context the something was giving up an opportunity to attach property that might affect the liability of the united states now the point is if again it's a broad requirement for five three five to a one this court rejected that analysis now while the prior opinion has been vacated and is no longer having legal legal force i can tell the government excuse me the court that the government completely agrees with the analysis on page twelve twenty four that the court noted that there is another regulatory provision five three five point five seven zero nine which is a general license which remove the blocking prohibition from any e two million dollars i'm sorry i had that the government didn't give them the two million dollars under the blocked under the attachment provision there korea had a number of different provisions one was a provision that allowed third parties like m judgments against iran to seek traditional attachment a property there was another provision which was an amendment to the victims protection act entirely separate from this block as that attack that provision which directed the treasury to give an on a pro distribution to give compensation partial compensation to certain individuals mr law he was one of them that provision had nothing to do with whether the property was blocked or not and it was under that provision that mr law he chose to accept compensation in exchange for giving up an opportunity to attach property that's at issue and claims now that that is section it's section court to it later if you like but it is also in our brief the trip there is a clear provision which specifically identifies that section i mentioned to a two d and says that section the at issue and claims portion of that section applies to individuals such  if the court has no further questions to find relinquishment i'd like to turn to the second issue the government would like to address which is whether or not the ministry is an agency or instrumentality worn inherent part of the iranian state the government has  three courts that have adopted that test have adopted a categorical rule allowing for no derivation the government has always argued not for a categorical rule but for a strong presumption the strong presumption comes from the the notion that poor functions like defense like treasury like foreign affairs should be presumed to be an absolute and a great part of the state unless there's a good reason for thinking otherwise however we've never argued for a categorical rule precisely because it remains possible even if unlikely that a state could set up its ministries one of its ministries differently so for example in the case of a defense ministry it's conceivable even if unlikely that a foreign state could decide to completely  give its defense powers to a mercenary company that operates on a for profit basis and goes around the world offering to provide defense services you're arguing for prevention and that means that there's an opportunity to that that percentage in that kind of evidence might come in and that that prevention and has a life he had the opportunity to present such evidence in this case i think your honor there has to be some reason you're exactly right you are that it is a rebuttable presumption however the presumption in the government's view has to be extremely strong one given that incredibly important foreign relations and diplomatic purpose is at issue here so it has it's incumbent on any individual who wants to suggest that a ministry that typically operates under the core functions of a state is not in fact operating that way the individual has to provide some reason for thinking that some further discovery or some for their fact finding is necessary in the government's view a bare allegation is not sufficient you can't go in our view on a fishing expedition precisely because this would entail  and that's when these that's the timing of these contracts so well how do we really know about your honor again although the opinion is no longer of legal force this court already in its prior pinion consider the evidence in the record and sa that the ministry is a core component of the of the government of iran that engages in absolutely essential governmental functions and again we agree though that's not binding on this panel at this point we agree with that analysis and we think that the court got it exactly attachment and the question would be whether or not the ministry which is now being sued after all mr law he is not seeking attachment from the pre ayatollah ministry he's seeking attachment from the existing ministry of defense the question is what is the ministry's existing status under existing law didn't just understand that if the ministry structure changes between for example if there had been a new under the new regime when the dynegy suddenly decided he was going to organize this mercenary m o v are you saying that if we were looking at it today the government's position would be that the outcome might be different if there had already happened that happened after the attachment in this case was taught and granted but it's now on appeal to us for example i see even in a district court in other words if circumstances change if the entity let me flip it the other way let's suppose the entity that entered into this contract was one of these mercenary delegate more like somalia where the you could say there wasn't really a functioning government so whatever was  ministry of defense now will as a core function are you saying that the government is the government's position here is that is what should be controlling i'm afraid your honor that there's not an easy answer to that question and let me explain why of course we would the there the question was whether an agency or instrumentality should be liable for a claim against the cuban state at that point the agency instrumentality no longer existed and all there was at that point was a ministry which the successor in interest so i think it's i think mansion if i'm remembering correctly is exactly your honour's hypothetical and in that context the supreme court said it would be improper in an equitable to allow the ministries current status in that context of that case not to be liable for the original kind so again it's very fact dependent but in that at least as an initial matter i think the initial lock is at the existing current structure made i don't think there's none of the representations indicate that the cubic judgment that model has is in dispute or in question before the iran u s claims trib of a jurisdictional issue is still an issue unless and until the tribunals determines that lacks jurisdiction over ron's claim to the property and in this case the tribunals rejected jurisdiction over a modest claim against cuba and we believe that as a result of the weak tribunal rejecting jurisdiction over m gs claim against kubic which results in the cuba judgment then the cuba judgment certainly is not an issue before the tribunal now with respect to mr law he's ability to attach blocked funds as the united states points out subsequent to the blocking provisions that were entered into with respect to iranian property subsequent regulations w issued in order to license transactions in property those are referenced in this court's prior opinion section five three five point five seven nine eight two does provide for regulation of transactions in iranian property our position in this case is that the blocking provisions are still in force and that additionally there are regulations pertaining to transactions or regulations with respect to property including block property but that section five three five point two or one of the regulations which blocked iranian property have never been repealed those are still in force any subsequent regulations are simply on top of blocking regulations so you have two sets of regulations that may apply to the cuban judgment acted in november of two thousand and two it's the terrorism risk insurance act the relevant provisions of that statute are a note to say the foreign sovereign immunity zax section sixteen to enable victims of terrorism to obtain rican pence both from assets of terrorist states and additionally from payments from the u s treasury  in the united states as part of its ability to enforce its contract its contract rights and claims against cuba make which this court has found to be  commercial and nature so pursuing a judgment against kubic attaining the cubic judgement is engaging in commercial activity in the united states because it is used to and was filed on april eleventh two thousand and three at pages two and page ten that discussion and in the the reply he in the earlier phase of the appeal filed on september tenth two thousand and three pages twenty five twenty eight was a block asset within the meaning of the international emergency emergency economic powers act not under korea the definition of black assets under three is different than the definition under i v and therefore the position we position without prejudging any outcome in this case i think it's a commentary on this country's commitment to the rule of law that the this kind of an argument can be held with such excellent counsel on both sides