Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca7-14-03344/USCOURTS-ca7-14-03344-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

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In the 

United States Court of Appeals 

For the Seventh Circuit ____________________ 

Nos. 14-3327 and 14-3344 

MARY NELL WYATT, individually and as Executrix of the Estate of RONALD E. WYATT, et al., 

Plaintiffs-Appellants, 

v.

SYRIAN ARAB REPUBLIC, et al., 

Defendants, 

and 

FRANCIS GATES, et al., 

Third-Party Defendants-Appellees. 

____________________ 

FRANCIS GATES, et al., 

Plaintiffs-Appellees, 

v.

SYRIAN ARAB REPUBLIC, et al., 

Defendant, 

v. 

MARY NELL WYATT, et al., 

Claimants-Appellants.

Case: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
2 Nos. 14-3327 and 14-3344 

____________________ 

Appeals from the United States District Court for the 

Northern District of Illinois, Eastern Division 

Nos. 11 C 8715 and 14 C 6161 — Virginia M. Kendall, Judge. 

____________________ 

ARGUED MAY 20, 2015 — DECIDED AUGUST 31, 2015 

____________________ 

Before BAUER, FLAUM, and HAMILTON, Circuit Judges. 

HAMILTON, Circuit Judge. These appeals address attempts 

to execute final judgments against the nation of Syria obtained by two groups of United States victims of Syrian 

state-sponsored terrorism. Both groups of victims have won 

judgments under the Foreign Sovereign Immunities Act. 

Both seek to satisfy their judgments by seizing the same Syrian assets located in the Northern District of Illinois. 

We affirm the actions of the district court, which ordered 

the assets disbursed to the appellees, whom we refer to as 

the Gates plaintiffs. The legal issue we decide on the merits 

is that plaintiffs who win judgments in state-sponsored terrorism cases against foreign governments under 28 U.S.C. 

§ 1605A, and who seek to attach property under § 1610(g), 

are not required to comply with the notice requirement of 

§ 1608(e) before executing their judgments. The Foreign Sovereign Immunities Act contains extensive procedural protections for foreign sovereigns in United States courts, but Congress has amended the Act to cut back some of those protections in cases of state-sponsored terrorism. Before dealing 

with the merits of this issue at the end of this opinion, howCase: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
Nos. 14-3327 and 14-3344 3

ever, we must first deal with a complex procedural history 

and several jurisdictional challenges. 

To explain, we begin by introducing the legal framework 

for remedies for state-sponsored terrorism under the Foreign 

Sovereign Immunities Act, the parties and their claims, and 

the involved procedural history of these appeals. We then 

address challenges to our jurisdiction and conclude by addressing the merits of these appeals. 

I. Legal, Factual, and Procedural Background 

A. Terrorism and the Foreign Sovereign Immunities Act

The default rule of United States law is that foreign states 

are immune from suit and attachment of assets in United 

States courts, but the Foreign Sovereign Immunities Act 

(FSIA) provides a number of exceptions and special procedures for such cases. The FSIA is comprehensive, so all cases 

against foreign sovereigns must be fitted into its statutory 

framework. Republic of Argentina v. NML Capital, Ltd., 573 

U.S. —, 134 S. Ct. 2250, 2255–56 (2014); Gates v. Syrian Arab 

Republic, 755 F.3d 568, 571 (7th Cir. 2014) (earlier appeal involving same Syrian assets at issues in these appeals). 

The FSIA now contains provisions specific to claims for 

state-sponsored terrorism. Section 1605A removes sovereign 

immunity in actions for money damages for personal injury 

or death resulting from an act of state-sponsored terrorism. 

28 U.S.C. § 1605A. Once plaintiffs obtain a judgment under 

§ 1605A, they may proceed to attach assets to execute that 

judgment under § 1610. Subsection § 1610(g) allows plaintiffs with a judgment against a state sponsor of terrorism to 

attach and execute the judgment against property of the forCase: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
4 Nos. 14-3327 and 14-3344 

eign state itself and any agency and instrumentality of the 

state. 

Other provisions of § 1610 establish the more general 

process for executing a judgment against a foreign state in 

suits other than those for state-sponsored terrorism, such as 

more ordinary contract or tort cases arising out of a foreign 

state’s commercial activities. Subsections 1610(a) and (b) describe the property of foreign states that is generally subject 

to attachment to satisfy a judgment. Subsection 1610(c) delays attachment and execution under § 1610(a) and (b) until 

a court determines that a reasonable period of time has 

elapsed following the entry of judgment. Subsection 1610(c) 

also requires compliance with § 1608(e), which directs a 

plaintiff who obtains a default judgment to serve the foreign 

state with a copy of the judgment in a specific manner. 

The interplay of these more general provisions and the 

special provisions for state-sponsored terrorism are at the 

center of the dispute between these two groups of victims. In 

Gates, we described the perhaps unintended consequences of 

this statutory scheme in previous appeals by a third group of 

victims seeking the same assets in dispute here: 

[T]he FSIA does not provide a mechanism for 

distributing equitably among different victims 

any Syrian assets in the United States that are 

subject to attachment. Instead, victims who finally obtain judgments must then engage in 

the costly, burdensome, and often fruitless task 

of searching for available assets. 

These victims of terror can then find themselves pitted in a cruel race against each othCase: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
Nos. 14-3327 and 14-3344 5

er—a race to attach any available assets to satisfy the judgments. The terms of the race are 

essentially winner-take-all rather than any equitable sharing among victims of similar losses. 

Under the FSIA’s compensation scheme, a terrorism judgment against Syria can be satisfied 

only at the expense of other terrorism victims. 

Gates, 755 F.3d at 571. 

B. The Gates Plaintiffs

In both of these appeals, the appellees are the Gates 

plaintiffs. They are defending the district court’s decision to 

release confiscated Syrian funds to them to satisfy their 

judgment. The Gates plaintiffs are relatives of Olin Eugene 

“Jack” Armstrong and Jack L. Hensley. Hensley and Armstrong were kidnapped in September 2004 by al-Qaeda 

when the two men were working as contractors in Iraq for 

the U.S. military. They were gruesomely murdered, and the 

killings were captured on a video that was made public by 

al-Qaeda. The Gates plaintiffs sued Syria under the FSIA for 

sponsoring al-Qaeda’s terrorism. (Syria has been on the list 

of state sponsors of terrorism since the list was created in 

1979.) 

On September 26, 2008, the Gates plaintiffs obtained a 

default judgment in the United States District Court for the 

District of Columbia for $413 million against Syria. A month 

later, on October 23, the court clerk sent a copy of the default 

judgment to the Syrian Foreign Ministry via a private delivery service, but the delivery was rejected and the delivery 

agent was told “the shipment is no longer required.” The 

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6 Nos. 14-3327 and 14-3344 

next day, Syria filed a notice of appeal challenging the district court’s personal jurisdiction over Syria. 

While that appeal was pending, the Gates plaintiffs 

sought to take steps to execute their judgment against Syria. 

The Wyatt plaintiffs, who had filed their own suit against 

Syria, moved to intervene in the Gates case in the District of 

Columbia, asserting a prior claim on Syrian assets in the District of Columbia because they had filed their suit earlier. 

The district court stayed enforcement of the Gates judgment 

pending appeal and denied as moot the Wyatt motion to intervene. 

On May 20, 2011, the United States Court of Appeals for 

the District of Columbia Circuit found personal jurisdiction 

proper and affirmed the district court’s default judgment in 

favor of the Gates plaintiffs. Gates v. Syrian Arab Republic, 646 

F.3d 1, 5 (D.C. Cir. 2011). The Gates plaintiffs then filed a motion in the District of Columbia district court for a § 1610(c) 

order authorizing them to enforce their judgment because a 

“reasonable time” had passed after entry of judgment and 

notice to Syria. 28 U.S.C. § 1610(c). The district court agreed 

that § 1610(c) had been satisfied and authorized the Gates 

plaintiffs to proceed to attachment and execution of the 

judgment. 

C. The Wyatt Plaintiffs

In both of the current appeals, the appellants are the Wyatt plaintiffs. They are also victims of terrorism sponsored by 

Syria. They are the relatives of Ronald Wyatt and Marvin T. 

Wilson, two biblical archaeologists who were captured in 

Turkey in August 1991 by armed members of the Kurdistan 

Workers’ Party (PKK), a militant Kurdish organization. The 

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Nos. 14-3327 and 14-3344 7

two men were held in captivity for 21 days under harsh conditions and in constant fear for their lives. The Wyatt plaintiffs sued the Syrian government for sponsoring PKK terrorism. 

Over a year after the District of Columbia Circuit affirmed the Gates judgment, the Wyatt plaintiffs obtained on 

December 17, 2012 a default judgment against Syria in the 

United States District Court for the District of Columbia for 

$338 million. The district court ordered the Wyatt plaintiffs 

to serve a copy of the default judgment on Syria pursuant to 

28 U.S.C. § 1608(e). Syria appealed the judgment, and the 

Wyatt plaintiffs cross-appealed, arguing that service under 

28 U.S.C. § 1608(e) was unnecessary because Syria had participated actively in the litigation and obviously knew of the 

default judgment. On January 30, 2014, the United States 

Court of Appeals for the District of Columbia Circuit affirmed the judgment against Syria and rejected the Wyatt 

plaintiffs’ cross-appeal, holding that § 1608(e) is a “clear and 

unambiguous statute” that required service of the default 

judgment. Wyatt v. Syrian Arab Republic, 554 Fed. App’x 16, 

17 (D.C. Cir. 2014) (mem). 

To comply with 28 U.S.C. § 1608(e), the Wyatt plaintiffs 

then served a copy of the judgment on the Syrian government, which had already appealed the same judgment. The 

Wyatt plaintiffs then sought a § 1610(c) order from the District of Columbia district court to authorize them to enforce 

their judgment because a “reasonable time” had passed. On 

May 19, 2014, that court ruled that the Wyatt plaintiffs had 

complied with § 1610(c) and authorized them to proceed to 

attachment and execution of the judgment. 

Case: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
8 Nos. 14-3327 and 14-3344 

D. The Northern District of Illinois Litigation 

In the meantime, however, while the Wyatt plaintiffs had 

still been seeking a final judgment and § 1610(c) order in the 

District of Columbia, the Gates plaintiffs had taken steps to 

execute their judgment against Syrian assets. They subpoenaed the Office of Foreign Assets Control in the U.S. Treasury Department to identify Syrian assets in the United States 

that could be attached to satisfy their judgment. The Office 

responded under a protective order and told the Gates plaintiffs that some Syrian assets were located in the Northern 

District of Illinois. 

1. Procedural History of Appeal No. 14-3344 

The Gates plaintiffs registered their judgment from the 

District of Columbia action with the district court in the 

Northern District of Illinois as case No. 11-cv-8715 and 

served a citation to discover assets on JP Morgan Chase 

Bank. The bank identified responsive accounts belonging to 

agencies and instrumentalities of Syria that were held by the 

bank itself and by AT&T. See 28 U.S.C. § 1610(g) (authorizing 

the attachment of and execution of a judgment against “the 

property of an agency or instrumentality” of a state liable for 

sponsoring terrorism). The Gates plaintiffs responded by 

serving AT&T with a citation to discover assets and pursued 

other responsive accounts at JP Morgan Chase Bank. 

The Gates plaintiffs litigated for two years in Illinois 

seeking a court order granting them the Syrian funds to satisfy their judgment. Part of that litigation was defending the 

priority of their claim against a competing claim by the 

Baker plaintiffs, another group of victims of terrorism seeking to satisfy their own judgment against Syria. The Baker 

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Nos. 14-3327 and 14-3344 9

plaintiffs intervened in the Gates suit in 2012. The district 

court ruled that the Gates plaintiffs had priority over the 

Baker plaintiffs and issued two turnover orders. A May 13, 

2013 order directed the release of the funds held by AT&T, 

and a February 3, 2014 order directed the release of the 

funds held by JP Morgan Chase. The Baker plaintiffs appealed those orders to this court. On June 18, 2014, we issued 

an opinion affirming both of the district court’s turnover orders. Gates, 755 F.3d 568. 

The Gates plaintiffs promptly moved for an order directing the clerk of the Northern District of Illinois to release the 

assets to them. Two days later, on August 17, 2014, the Wyatt 

plaintiffs took their first action regarding the Gates lawsuit 

in Illinois. The Wyatt plaintiffs filed not a motion to intervene but a memorandum of opposition contesting the Gates 

plaintiffs’ right to the assets. The Gates plaintiffs moved to 

strike the filing. The district court held a hearing and on October 22, 2014 granted the Gates plaintiffs’ motion to release 

funds. The Wyatt plaintiffs’ appeal of that order was docketed as No. 14-3344. 

2. Procedural History of Appeal No. 14-3327 

On August 11, 2014, the Wyatt plaintiffs had also filed a 

separate action in the Northern District of Illinois, No. 14-cv6161. They named Syria as the defendant and the Gates 

plaintiffs as third-party defendants. In that action, the Wyatt 

plaintiffs registered their judgment from the District of Columbia action and served a citation to discover assets on the 

clerk of court for the Northern District of Illinois. (By that 

time, JP Morgan Chase and AT&T had placed the disputed 

funds in the district court’s registry.) The Wyatt plaintiffs also moved for the turnover and release of the assets. The 

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10 Nos. 14-3327 and 14-3344 

Gates plaintiffs moved to dismiss the complaint for failure to 

state a claim and lack of jurisdiction. Also on October 22, 

2014, the district court dismissed the Wyatt plaintiffs’ complaint. The court also denied the Wyatt plaintiffs’ motion to 

stay that decision a few weeks later. The Wyatt plaintiffs’ appeal of those orders was docketed as No. 14-3327. 

II. Jurisdiction 

Jurisdiction is a threshold issue that we must address before discussing the merits. India Breweries, Inc. v. Miller Brewing Co., 612 F.3d 651, 657 (7th Cir. 2010). We first explain why 

we have jurisdiction to hear these appeals and then why the 

district court had jurisdiction to enter the orders the Wyatt 

plaintiffs ask us to review. 

A. Appellate Jurisdiction 

The Gates plaintiffs challenge on two grounds our jurisdiction to hear these appeals. First, they argue the Wyatt 

plaintiffs had no right to challenge the turnover order 

awarding the assets to the Gates plaintiffs. This argument 

challenges our jurisdiction to hear appeal No. 14-3344. Second, the Gates plaintiffs argue that both appeals are moot 

because we have no power to order a meaningful remedy. 

We address these arguments in turn. 

1. Right of Wyatt Plaintiffs to Challenge the Turnover 

Order 

The Gates plaintiffs maintain that we do not have jurisdiction over No. 14-3344 because the Wyatt plaintiffs never 

properly became, or tried to become, parties to the case in 

the district court, so that they have no right to appeal the order releasing the funds. The Gates plaintiffs complain that 

the Wyatt plaintiffs flouted the Federal Rules of Civil ProceCase: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
Nos. 14-3327 and 14-3344 11

dure by failing to apply for intervention under Rule 24, 

which requires a party seeking intervention to file a timely 

motion stating the grounds for intervention, accompanied by 

a pleading setting forth the claim. Without a motion to intervene, say the Gates plaintiffs, the Wyatt plaintiffs never became parties to the Gates action and cannot appeal the order 

in that case. 

The Wyatt plaintiffs respond that the Gates action in Illinois sought to attach Syrian assets to execute the final judgment of another federal court, so their ability to participate 

should be governed by Illinois law. Federal Rule of Civil 

Procedure 69(a) provides that attachment and execution 

procedures to satisfy a federal judgment “must accord with 

the procedure of the state where the court is located, but a 

federal statute governs to the extent it applies.” The Wyatt 

plaintiffs contend they were not required to intervene to assert their claim to the Syrian assets. 

Intervention is ordinarily the proper path to assert rights 

in a federal civil case to which one is not yet a party. There 

are a few exceptions to that general rule, however. In entertaining the appeal of a law firm challenging distribution of 

fees out of a class settlement, we held the firm was a party 

even though it never intervened: “Intervention isn’t the only 

route for becoming a party. Nonparties in a trial court can 

participate as parties to the appeal without formal intervention if the outcome of the appeal would be likely to determine (not just affect) their rights.” In re Trans Union Corp. 

Privacy Litig., 664 F.3d 1081, 1084 (7th Cir. 2011). In Trans Union, we relied in part on SEC v. Enterprise Trust Co., 559 F.3d 

649, 651 (7th Cir. 2009), which held that persons claiming 

rights in property in receivership could appeal the district 

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12 Nos. 14-3327 and 14-3344 

court’s approval of the receiver’s plan without having formally intervened. 

Because Rule 24 intervention is not quite the exclusive 

method for joining a lawsuit to appeal a district court order, 

we apply Rule 69 and look to Illinois law on attachment and 

execution to determine whether this procedure was proper.1 

Illinois law on the procedure for attachment and execution 

of a judgment gives adverse claimants to property the right 

to appear and maintain a claim before their interest in the 

property is extinguished. The statute on these supplementary proceedings provides: 

If it appears that any property, chose in action, 

credit or effect discovered, or any interest 

therein, is claimed by any person, the court 

shall, as in garnishment proceedings, permit or 

require the claimant to appear and maintain 

his or her right. The rights of the person cited 

and the rights of any adverse claimant shall be 

asserted and determined pursuant to the law 

relating to garnishment proceedings. 

735 Ill. Comp. Stat. 5/2-1402(g). This provision incorporates 

the law of garnishment proceedings, which provides: 

In the event any indebtedness or other property due 

from or in the possession of a garnishee is claimed 

by any other person, the court shall permit the 

claimant to appear and maintain his or her claim. A 

 1 We took this approach in a non-precedential decision involving 

quite similar issues. United States v. Macchione, 309 Fed. App’x 53, 55 (7th 

Cir. 2009) (looking to Illinois law to determine the right of adverse 

claimants to appear even without formal intervention). 

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Nos. 14-3327 and 14-3344 13

claimant not voluntarily appearing shall be 

served with notice as the court shall direct. If a 

claimant fails to appear after being served with 

notice in the manner directed, he or she shall 

be concluded by the judgment entered in the 

garnishment proceeding. 

735 Ill. Comp. Stat. 5/12-710(a) (emphasis added). The statute 

further provides that an adverse claimant who appears and 

files a timely claim is “a party to the garnishment proceeding” whose “claim shall be tried and determined with the 

other issues in the garnishment action.” 735 Ill. Comp. Stat. 

5/12-710(b). 

The Wyatt plaintiffs argue that these statutes permit 

them, without Rule 24 intervention, to oppose the release of 

funds in the Gates case in district court and to appeal the 

court’s adverse decision because they are adverse claimants 

entitled to an opportunity to have their claim heard. They 

interpret these statutes to mean that their claim on the assets 

can be resolved only after they received proper notice and an 

opportunity to appear and maintain their claim. Because 

they never received notice, they argue, the district court, and 

this court on appeal, must address their claim to the assets to 

give them the opportunity to be heard granted by Illinois 

law. 

The Wyatt plaintiffs rely on an Illinois decision holding it 

was reversible error to deny an adverse claimant the opportunity to prove his claim. See B.J. Lind & Co. v. Diacou, 278 

N.E.2d 526, 529 (Ill. App. 1971) (reversing citation judgment 

and directing on remand that “all parties be afforded the 

opportunity to prove their respective claims”). Illinois law 

undoubtedly favors giving an adverse claimant an opporCase: 14-3344 Document: 75 Filed: 08/31/2015 Pages: 24
14 Nos. 14-3327 and 14-3344 

tunity to be heard before extinguishing the claim. See 735 Ill. 

Comp. Stat. 5/2-1402(g) (“If it appears” there is an adverse 

claim, “the court shall, as in garnishment proceedings, permit or require the claimant to appear and maintain his or her 

right.”); Bloink v. Olson, 638 N.E.2d 406, 411 (Ill. App. 1994) 

(holding that if third party claims entitlement to assets of 

judgment debtor, “a trial must be held to ascertain the parties’ rights to the disputed property”). 

On the other hand, there are reasons to distinguish the 

Wyatt plaintiffs’ procedural maneuver from the usual adverse claim contemplated by these statutes and cases. First, 

the Wyatt plaintiffs presented their adverse claim only after 

the Gates plaintiffs had obtained a final judgment awarding 

them the assets. Second, the Wyatt plaintiffs do not claim 

that either the Gates plaintiffs or the parties holding the assets (Chase and AT&T) can be faulted for failing to give notice of the proceedings. The Wyatt plaintiffs acquired their 

claim to the Syrian assets months after the district court ordered the turnover of the assets. At the time of the turnover 

proceedings, neither the Gates plaintiffs nor the parties holding the assets had notice of an adverse claim by the Wyatt 

plaintiffs. 

Illinois law tells us, however, that the first distinguishing 

fact—the Wyatt plaintiffs’ attempt to upset a final judgment—does not necessarily bar their attempt to have their 

claim heard. More than a century ago, an Illinois appellate 

court heard the appeal of an adverse claimant who appeared 

before the district court two weeks after judgment was entered in favor of a judgment creditor. Paepcke-Leicht Lumber 

Co., v. Becker, for Use of, 124 Ill. App. 311, 312 (1906). The adverse claimant moved to vacate the judgment, but the trial 

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Nos. 14-3327 and 14-3344 15

court refused to upset the judgment or allow the claimant to 

interplead in the case. The appellate court reversed: “It is no 

answer to appellant’s claim that a judgment was entered prior to his motion for leave to interplead. The court had ample 

power to vacate that judgment during the term at which it 

was rendered.” Id. at 317. The Paepcke-Leicht Lumber case signals that the final judgment in favor of the Gates plaintiffs 

does not bar us from considering the merits of the Wyatt 

plaintiffs’ claim. 

Illinois law is less clear, however, on the second issue: 

whether an adverse claimant is entitled to maintain her 

claim even when neither the judgment creditor nor the parties holding the assets had notice of the claim. Several cases, 

including Paepcke-Leicht Lumber, hold that an adverse claim 

should be heard whether notice of the garnishment proceedings is given to the holder of the assets before or after assignment of funds in the account when there are sufficient 

funds in the account. Id. (“The bank should have stated, in 

its answer to the interrogatories, for its own protection, the 

claim of which appellant had apprised it.”); Chott v. Tivoli 

Amusement Co., 82 Ill. App. 244, 248-49 (1899) (“If the garnishee has notice or information that a third party claims an 

interest in the fund or property in controversy, he must, if he 

would protect himself against such claim, disclose it by his 

answer, even though he can not, of his own knowledge, 

swear to the existence of the claim or its precise nature.”). 

These cases indicate that the failure to give notice to a known

claimant can justify consideration of a post-judgment claim. 

That does not mean that prior knowledge of the claim is necessary for a court to hear it. No Illinois case that we are 

aware of answers whether prior knowledge is required. 

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16 Nos. 14-3327 and 14-3344 

As a federal court applying state law, our duty is to apply 

Illinois law as we believe the Illinois Supreme Court would, 

and in doing so, we accord great weight to the decisions of 

appellate courts. Liberty Mutual Fire Ins. Co. v. Statewide Ins. 

Co., 352 F.3d 1098, 1100 (7th Cir. 2003). The question is admittedly close, but we believe the Illinois courts would more 

likely than not entertain the adverse claim on the merits, 

even when the garnishee and judgment creditor had no prior 

knowledge of the claim, so long as the claimant had also 

been given no notice of the attachment litigation. We would 

not be surprised if the Illinois courts were to decide this 

question the other way, given the great interest in finality of 

judgments, but our prediction is consistent with the preference in Illinois law for giving adverse claimants a fair opportunity to be heard before extinguishing their claims. A rule 

flatly barring courts from hearing later-raised adverse claims 

would risk placing even fraudulent prior claims beyond review. At the same time, we recognize that the approach we 

adopt today is subject to abuse by fraudulent and frivolous 

claims by greedy interlopers and bystanders. In such cases 

(but this is not one), courts have available and should employ sanctions and other tools firmly to discourage such 

abuse. For these reasons, we conclude that the Wyatt plaintiffs’ failure to seek to intervene in the district court does not 

bar them from appealing the district court’s turnover order. 

2. Mootness of Both Appeals 

The Gates plaintiffs next argue that both appeals are 

moot because the funds that were in the custody of the district court have already been disbursed to them. They claim 

it is no longer possible for this court or the district court to 

fashion meaningful relief for the Wyatt plaintiffs because we 

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Nos. 14-3327 and 14-3344 17

do not have the power to order that money now in the hands 

of the Gates plaintiffs be returned to the court or given to the 

Wyatt plaintiffs. See A.B. v. Housing Auth. of South Bend, 683 

F.3d 844 (7th Cir. 2012) (a case is moot if no form of meaningful relief is possible). In the absence of a live controversy, the 

Gates plaintiffs argue, the appeals should be dismissed. See 

Milwaukee Police Ass’n v. Board of Fire & Police Comm’rs of 

Milwaukee, 708 F.3d 921 (7th Cir. 2013). 

We hold the cases are not moot because we have the equitable power to require the return of the funds if the order 

releasing them was erroneous. As the Supreme Court explained almost a hundred years ago, it is a “principle, long 

established and of general application, that a party against 

whom an erroneous judgment or decree has been carried into effect is entitled, in the event of a reversal, to be restored 

by his adversary to that which he has lost thereby. This right, 

so well founded in equity, has been recognized in the practice of the courts of common law from an early period.” 

Arkadelphia Milling Co. v. St. Louis Southwestern Railway Co., 

249 U.S. 134, 145 (1919); see also In re Zurn, 290 F.3d 861, 862 

(7th Cir. 2002) (noting that litigant should return money obtained from a judgment reversed on appeal but observing 

that state court was right forum for dispute); Buzz Barton & 

Associates, Inc. v. Giannone, 483 N.E.2d 1271, 1275 (Ill. 1985) 

(“[I]f a party has received benefits from an erroneous decree 

or judgment, he must, after reversal, make restitution, and if 

he has sold the property erroneously adjudged to belong to 

him, he must account to the true owners for its value.”). 

The Gates plaintiffs point out that these cases cited by the 

Wyatt plaintiffs involved bilateral relations, where the court 

ordered one party to return funds wrongfully obtained from 

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18 Nos. 14-3327 and 14-3344 

the other party to the case. But the presence of an additional 

party—here the funds originally belonged to Syria but were 

disbursed to the Gates plaintiffs and now are sought by the 

Wyatt plaintiffs—does not defeat our jurisdiction to correct a 

disbursement if it was wrongful. We have considered this 

question in interpleader cases and held that we have jurisdiction to set aside an erroneous distribution order and to 

direct the defendant who received the funds to pay them to 

another defendant, the rightful recipient. Smith v. Widman 

Trucking & Excavating, Inc., 627 F.2d 792, 798–99 (7th Cir. 

1980); see also General Railway Signal Co. v. Corcoran, No. 89 C 

9360, 1992 WL 220604, at *4–5 (N.D. Ill. Sept. 4, 1992) (Rovner, J.) (declining to limit Smith to Rule 60(b) motions and 

concluding that a district court retains jurisdiction to vacate 

an order of distribution regardless of whether the court or a 

claimant holds the funds).2

Accordingly, if the Wyatt plaintiffs were to prevail on the 

merits and demonstrate that the turnover orders were issued 

erroneously, we would have the power to order the Gates 

 2 To be clear, no one contends that any party to this dispute has 

committed any sort of fraud on any court. But if we accepted the Gates 

plaintiffs’ argument that we have no jurisdiction even to consider the 

Wyatt plaintiffs’ claim, then it would also be beyond our jurisdiction to 

correct an order disbursing funds even if it had been obtained by fraud. 

That troubling proposition could allow litigants to use the court’s imprimatur to legalize fraud. During oral argument, the Gates plaintiffs 

responded to the fraud hypothetical by saying that Rule 60(b)—which 

lists fraud as a ground for relief from a final judgment—could be used to 

correct the fraud. But that answer implicitly concedes that it would be 

possible to fashion a remedy, which means that the appeals are not moot 

and that we have jurisdiction to decide the merits. 

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Nos. 14-3327 and 14-3344 19

plaintiffs to return the funds. Because it is possible for a 

court to award meaningful relief, the appeals are not moot.3 

B. Jurisdiction of the District Court 

The Wyatt plaintiffs raise a different jurisdictional issue, 

challenging the jurisdiction of the district court. They contend that the district court had no jurisdiction to issue the 

November 6 order releasing the funds after the Wyatt plaintiffs filed their notice of appeal on October 22, 2014, which 

divested the district court of jurisdiction. The Wyatt plaintiffs argue that the court’s November 6 order—granting the 

Gates plaintiffs’ motion for release of the funds—is void because it was entered without jurisdiction. See Kusay v. United 

States, 62 F.3d 192, 194 (7th Cir. 1995) (declaring that any action by the district court after the notice of appeal was filed 

but before the mandate from the court of appeals issues is a 

“nullity”).4 

 3 To support their mootness argument, the Gates plaintiffs also rely 

on Porco v. Trustees of Indiana University, 453 F.3d 390, 394–95 (7th Cir. 

2006). That case is plainly distinguishable. We held Porco’s suit was 

moot because the Eleventh Amendment precluded us from ordering the 

defendant, a state university, to return money that had been disbursed 

according to a court order. The Eleventh Amendment poses no bar to 

relief in this suit because none of the Gates plaintiffs is a state. 

4 The district court’s November 6 order also denied the Wyatt plaintiffs’ motion to stay the release of funds. The district court clearly had 

jurisdiction to deny the Wyatt plaintiffs’ motion to stay the release of the 

funds. Federal Rule of Appellate Procedure 8(a)(1)(A) provides that a 

party to an appeal should “ordinarily move first in the district court for 

... a stay of the judgment or order of a district court pending appeal.” 

That rule would make no sense if a district court lacked jurisdiction to 

rule on the motion for a stay of its judgment pending appeal.

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20 Nos. 14-3327 and 14-3344 

Our cases holding that the notice of appeal transfers exclusive jurisdiction to the court of appeals have explained 

that the district court is divested of control over only “those 

aspects of the case involved in the appeal.” Henry v. Farmer 

City State Bank, 808 F.2d 1228, 1240 (7th Cir. 1986). That rule 

“does not prevent the court from handling collateral matters 

such as the award of costs and ... the collection of a judgment.” Chicago Truck Drivers Pension Fund v. Central 

Transport, Inc., 935 F.2d 114, 119–20 (7th Cir. 1991). Even after 

a notice of appeal has been filed, the district court retains the 

power to take further action “in aid of execution of a judgment that has not been stayed or superseded.” Henry, 808 

F.2d at 1240. 

The district court’s November 6, 2014 order was in aid of 

execution of a judgment, not a new judgment that exceeded 

its jurisdiction. The district court had ordered the turnover 

of the funds to the Gates plaintiffs on May 13, 2013 and February 3, 2014. After that decision was affirmed on appeal by 

this court and the case was returned to the district court in 

August 2014, the Wyatt plaintiffs filed their opposition. The 

district court considered the Wyatt plaintiffs’ claim but ultimately issued a final judgment against them, dismissing 

their claim, on October 22. The district court and this court 

declined to stay that judgment pending appeal. The court’s 

November 6 order for release of the funds was therefore a 

proper execution of its judgments awarding the funds to the 

Gates plaintiffs and denying the Wyatt plaintiffs’ opposition. 

The district court was acting within its jurisdiction. 

III. The Priority of the Competing Claims 

We come at last to the merits of the dispute. The Gates 

plaintiffs registered their judgment and served a citation to 

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Nos. 14-3327 and 14-3344 21

discover assets on December 8, 2011. Under Illinois law, that 

gave the Gates plaintiffs a perfected lien on the assets as of 

that date. See Gates, 755 F.3d at 578, citing 735 Ill. Comp. Stat. 

5/2-1402(m). If the Gates plaintiffs’ judgment, attachment, 

and execution are valid, then they plainly have priority over 

the Wyatt plaintiffs, who did not register a judgment and 

serve a citation to discover assets until nearly three years later. 

The Wyatt plaintiffs claim that the Gates plaintiffs are not 

entitled to the Syrian assets identified in the Northern District of Illinois because the Gates plaintiffs failed to comply 

with § 1608(e) of the FSIA. That provision requires that a 

foreign state be served with any default judgment entered 

against it: “A copy of any such default judgment shall be sent 

to the foreign state or political subdivision in the manner 

prescribed for service in this section.” 28 U.S.C. § 1608(e). 

For the purposes of our discussion of this argument, we assume that the Wyatt plaintiffs are correct in asserting that the 

Gates plaintiffs have not complied with the service requirements of § 1608(e).5

 5 The Gates plaintiffs had the clerk of court send a copy of the default judgment to Syria via a private courier service, but the delivery was 

rejected in Syria. Section 1608(a)(2) requires that documents that are 

served by mail be sent “requiring a signed receipt,” which the Gates 

plaintiffs admit they never obtained. The Gates plaintiffs claim that they 

satisfied § 1608(e) even though they never received a signed receipt. 

Most courts have interpreted § 1608 to require strict compliance with the 

specific rules for service on foreign states. E.g., Magness v. Russian Federation, 247 F.3d 609, 615 (5th Cir. 2001) (“We conclude that the provisions 

for service of process upon a foreign state or political subdivision of a 

foreign state outlined in section 1608(a) can only be satisfied by strict 

compliance.”); but see Peterson v. Islamic Republic of Iran, 627 F.3d 1117, 

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The Wyatt plaintiffs’ argument fails to deal with the 

structure and terms of the FSIA, and in particular with its 

special provisions for claims for state-sponsored terrorism. 

The statutory consequence of failing to satisfy the service requirement in § 1608(e) is that plaintiffs with a judgment 

against a foreign state cannot obtain authorization under 

§ 1610(c) to proceed to attachment and execution of that 

judgment. Section 1610(c) provides: 

No attachment or execution referred to in subsections (a) and (b) of this section shall be permitted until the court has ordered such attachment and execution after having determined that a reasonable period of time has 

elapsed following the entry of judgment and 

the giving of any notice required under section 

1608(e) of this chapter. 

28 U.S.C. § 1610(c). Subsections (a) and (b) list categories of 

assets of foreign states, and of their agencies and instrumentalities, that can be attached in aid of execution of a judgment obtained through a suit authorized by the FSIA. Accordingly, a plaintiff who does not serve a copy of the default judgment to satisfy § 1608(e) is not entitled to authorization to execute the judgment under § 1610(c). 

 

1129 (9th Cir. 2010) (“The Ninth Circuit has adopted a substantial compliance test for the FSIA’s notice requirements and ... the defendant had 

actual notice.”). We do not decide what § 1608(e) requires, nor whether 

the Gates plaintiffs have satisfied those requirements, because the Gates 

plaintiffs were entitled to execute their judgment against the Syrian assets without complying with § 1608(e). 

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Nos. 14-3327 and 14-3344 23

The critical point here, however, is that the Gates plaintiffs are not executing their judgment under § 1610(c) or under § 1610(a) or (b), the provisions cross-referenced in 

§ 1610(c). The Gates plaintiffs obtained § 1610(c) authorization from the district court in the District of Columbia, which 

the Wyatt plaintiffs claim was an error. That order was unnecessary. The Gates plaintiffs are seeking to execute a 

judgment for state-sponsored terrorism, so they may proceed through the execution provision specifically enacted for 

terrorism judgments, § 1610(g). 

As we held in Gates, “§ 1610(c) simply does not apply to 

the attachment of assets to execute judgments under 

§ 1610(g) for state-sponsored terrorism.” 755 F.3d at 575. We 

reached that conclusion based on the structure and language 

of the FSIA and its legislative history. We also found that 

conclusion was consistent with the legislative purpose behind the 2008 FSIA Amendments that added § 1610(g) to the 

statute. The purpose of those amendments was “to make it 

easier for terrorism victims to obtain judgments and to attach assets.” Id. at 576. “Exempting attachments under 

§ 1610(g), that is, attachments stemming from terrorismrelated judgments, from § 1610(c)’s solicitous notice requirements is entirely consistent with the liberalizing purpose of the 2008 Amendments.” Id. at 576–77. 

The service of default judgments under § 1608(e) is one of 

§ 1610(c)’s solicitous notice requirements, from which attachments under § 1610(g) are exempt. The Gates plaintiffs, 

as terrorism victims who obtained a judgment under 

§ 1605A, could proceed to attachment and execution under 

§ 1610(g) without complying with § 1610(c). That means they 

are also exempt from § 1608(e), at least as a prerequisite for 

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24 Nos. 14-3327 and 14-3344 

attachment and execution. A failure to comply with § 1608(e) 

does not render invalid their attachment of assets and satisfaction of their judgment for state-sponsored terrorism. 

The Gates plaintiffs were therefore entitled to priority, so 

we affirm the district court’s orders challenged in these appeals disbursing funds to the Gates plaintiffs and dismissing 

the Wyatt plaintiffs’ challenges to them. We affirm without 

needing to address several alternative arguments for affirmance, including whether these appeals amount to improper 

collateral challenges to the District of Columbia court’s issuance of a § 1610(c) order to the Gates plaintiffs, whether the 

mandate rule foreclosed the Wyatt plaintiffs’ efforts after 

Gates, and whether the Wyatt plaintiffs waived their challenges by not pursuing their unsuccessful effort to intervene 

in the Gates case in the District of Columbia years before 

judgment was entered. 

The orders of the district court are AFFIRMED. 

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