Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-16100/USCOURTS-ca9-13-16100-2/pdf.json

Parties Involved:
Bank Melli
Appellant
Linda Bennett
Appellee
Michael Bennett
Appellee
Franklin Resources, Inc.
Appellee
Greenberg and Acosta Judgement Creditors
Appellee
Heiser Judgment Creditors
Appellee
The Islamic Republic of Iran

United States of America
Amicus Curiae
VISA Inc.
Appellee

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

MICHAEL BENNETT; LINDA

BENNETT, as Co-Administrators of

the Estate of Maria Ann Bennett,

Plaintiffs-Appellees,

v.

THE ISLAMIC REPUBLIC OF IRAN,

Defendant,

v.

VISA INC.; FRANKLIN RESOURCES,

INC.,

Defendants-third-partyplaintiffs–Appellees,

v.

GREENBERG AND ACOSTA

JUDGEMENT CREDITORS,

Plaintiff-third-partydefendant–Appellee,

HEISER JUDGMENT CREDITORS,

Plaintiff-fourth-partydefendant–Appellee,

v.

Nos. 13-15442

13-16100

D.C. No.

3:11-cv-05807-

CRB

ORDER AND

AMENDED

OPINION

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2 BENNETT V. BANK MELLI

BANK MELLI,

Plaintiff-third-partydefendant–Appellant.

Appeals from the United States District Court

for the Northern District of California

Charles R. Breyer, Senior District Judge, Presiding

Argued and Submitted

April 15, 2015—San Francisco, California

Filed February 22, 2016

Amended June 14, 2016

Before: Sidney R. Thomas,*

 and Susan P. Graber, Circuit

Judges, and Dee V. Benson,** Senior District Judge.

Order;

Opinion by Judge Graber;

Partial Concurrence and Partial Dissent by Judge Benson

* Chief Judge Thomas was drawn to replace Judge Kozinski. He has

read the briefs, reviewed the record, and listened to the audio-recording of

oral argument held on April 15, 2015.

** The Honorable Dee V. Benson, Senior District Judge for the U.S.

District Court for the District of Utah, sitting by designation.

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BENNETT V. BANK MELLI 3

SUMMARY***

Foreign Sovereign Immunity

The panel filed (1) an order amending its opinion and

partial dissent filed February 22, 2016, and denying petitions

for panel rehearing and rehearing en banc; and (2) an

amended opinion and partial dissent.

In its amended opinion, the panel affirmed the district

court’s denial of the motion of Bank Melli, the national bank

of the Islamic Republic of Iran, to dismiss claims filed against

it in an interpleader complaint seeking a determination of the

rights to blocked Iranian assets held by other parties but owed

to Bank Melli. Judgment creditors of Iran sought access to

the assets in order to collect on unsatisfied judgments for

deaths and injuries suffered in terrorist attacks sponsored by

Iran.

The panel held that the Terrorism Risk Insurance Act

permits judgment creditors to attach assets held by the

instrumentalities of state sponsors of terrorism. Accordingly,

the blocked assets of Bank Melli that were at issue in this

case could be attached. Agreeing with the Seventh Circuit,

the panel held that § 1610(g) of the Foreign Sovereign

Immunities Act also permitted attachment. The panel held

that these statutes did not impermissibly impose retroactive

liability even though the terrorist acts underlying the

judgments occurred before enactment of the statutes.

 

*** This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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4 BENNETT V. BANK MELLI

The panel also held that under California law, the assets

were property of Bank Melli. In addition, because Bank

Melli did not enjoy sovereign immunity, and could be joined

in the action, Federal Rule of Civil Procedure 19 did not

require dismissal of the claims against Bank Melli.

District Judge Benson concurred with the majority that

§ 201(a) of the Terrorism Risk Insurance Act and § 1610 of

the Foreign Sovereign Immunities Act permitted the

judgment creditors to attach and execute against monies owed

to Bank Melli. Judge Benson dissented from the holding that

§ 1610(g) is a freestanding immunity exception. He stated

that in his view, the judgment creditors could proceed

because they had sufficiently alleged that Bank Melli was

engaged in commerce in the United States within the meaning

of the exception to attachment immunity set forth in

§ 1610(b)(3).

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BENNETT V. BANK MELLI 5

COUNSEL

Jeffrey A. Lamken, Robert K. Kry (argued) and Lucas M.

Walker, MoloLamken LLP, Washington D.C., for Appellant.

Curtis C. Mechling (argued), Benjamin Weathers-Lowin, and

Patrick N. Petrocelli, Stroock & Stroock & Lavan LLP, New

York, New York; Dale K. Cathell and Richard M. Kremen,

DLA Piper LLP, Baltimore, Maryland; Jane Carol Norman

and Thomas Fortune Fay, Bond & Norman, Washington,

D.C., for Judgment Plaintiffs-Appellees.

Benjamin T. Peele, III (argued), Baker & McKenzie LLP,

Washington, D.C.; Bruce H. Jackson, Baker & McKenzie

LLP, San Francisco, California, for Appellees Visa, Inc. and

Franklin Resources, Inc.

ORDER

The opinion and partial dissent filed February 22, 2016,

and reported at 817 F.3d 1131, are amended by the opinion

and partial dissent filed concurrently with this order.

With these amendments, Judges Thomas and Graber have

voted to deny Appellant’s petition for panel rehearing and

petition for rehearing en banc. Judge Benson has voted to

grant the petition for panel rehearing and has recommended

granting the petition for rehearing en banc.

The full court has been advised of the petition for

rehearing en banc, and no judge of the court has requested a

vote on it.

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6 BENNETT V. BANK MELLI

Appellant’s petition for panel rehearing and petition for

rehearing en banc are DENIED. No further petitions for

panel rehearing or for rehearing en banc may be filed.

OPINION

GRABER, Circuit Judge:

Approximately 90 United States citizens (or the

representatives of their estates) are attempting to collect on

unsatisfied money judgments that they hold against the

Islamic Republic of Iran for deaths and injuries suffered in

terrorist attacks sponsored by Iran. The assets that are the

subject of this interpleader action are monies contractually

owed to Bank Melli by Visa Inc. and Franklin Resources Inc.

(“Franklin”). Bank Melli is an instrumentality of Iran. It

asserts that Plaintiffs cannot execute on the assets (1) because

Bank Melli enjoys sovereign immunity under the Foreign

Sovereign Immunities Act of 1976 (“FSIA”), (2) because the

relevant statutory exceptions to sovereign immunity may not

be applied retroactively, (3) because the blocked assets are

not property of Bank Melli, and (4) because Bank Melli is a

required party that cannot be joined, thus requiring dismissal

under Federal Rule of Civil Procedure 19. We disagree and,

accordingly, affirm the judgment of the district court.

BACKGROUND LEGAL PRINCIPLES

The jurisdiction of the United States over persons and

property within its territory “is susceptible of no limitation

not imposed by itself.” Schooner Exch. v. McFaddon,

11 U.S. (7 Cranch) 116, 136 (1812). Accordingly, foreign

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BENNETT V. BANK MELLI 7

sovereign immunity is “a matter of grace and comity rather

than a constitutional requirement.” Republic of Austria v.

Altmann, 541 U.S. 677, 689 (2004). Courts consistently

“defer[] to the decisions of the political branches” on whether

to take actions against foreign sovereigns and their

instrumentalities. Id. (quoting Verlinden B.V. v. Cent. Bank

of Nigeria, 461 U.S. 480, 486 (1983)).

The FSIA, 28 U.S.C. §§ 1330, 1602–1611, establishes a

default rule that foreign states are immune from suit in United

States courts. Id. § 1604. Congress enacted the statute to

provide a “comprehensive . . . ‘set of legal standards

governing claims of immunity in every civil action against a

foreign state or its political subdivisions, agencies, or

instrumentalities.’” Altmann, 541 U.S. at 691 (quoting

Verlinden B.V., 461 U.S. at 488). The FSIA provides the

exclusive vehicle for subject matter jurisdiction in all civil

actions against foreign state defendants. Bank Markazi v.

Peterson, 136 S. Ct. 1310, 1317 n.1 (2016); OBB

Personenverkehr AG v. Sachs, 136 S. Ct. 390, 393 (2015);

Flatow v. Islamic Republic of Iran, 308 F.3d 1065, 1069 (9th

Cir. 2002).

The FSIA includes many exceptions to its general rule of

immunity. 28 U.S.C. §§ 1605–1607. Relevant here, in 1996,

Congress added a new exception, stripping a foreign state of

its sovereign immunity when (1) the United States officially

designates the foreign state a state sponsor of terrorism and

(2) the foreign state is sued “for personal injury or death that

was caused by an act of torture, extrajudicial killing, aircraft

sabotage, hostage taking, or the provision of material support

or resources for such an act.” Id. § 1605A.

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8 BENNETT V. BANK MELLI

Iran was designated a terrorist party pursuant to section

6(j) of the Export Administration Act of 1979, 50 U.S.C. app.

§ 2405(j) (effective Jan. 19, 1984). Peterson v. Islamic

Republic of Iran, 627 F.3d 1117, 1123 (9th Cir. 2010);

Weinstein v. Islamic Republic of Iran, 609 F.3d 43, 48 (2d

Cir. 2010). That designation means that Iran is not entitled to

sovereign immunity for claims under § 1605A.

Separately, the FSIA addresses the immunity of sovereign

property from execution and attachment. Subject to

enumerated exceptions, a foreign state’s property in the

United States is immune from attachment and execution. 

28 U.S.C. § 1609.

In First National City Bank v. Banco Para el Comercio

Exterior de Cuba (“Bancec”), 462 U.S. 611, 620–21 (1983),

the Supreme Court concluded that the FSIA did not control

whether and to what extent instrumentalities could be held

liable for the debts of their sovereigns. Applying

international law and federal common law, the Court held that

“government instrumentalities established as juridical entities

distinct and independent from their sovereign should

normally be treated as such.” Id. at 626–27. That rule,

referred to as the “Bancec presumption,” may be overcome

only in limited circumstances. Id. at 628–34. The federal

courts later described five “Bancec factors” that may be

considered in determining whether the presumption has been

overcome in any given case. E.g., Flatow, 308 F.3d at 1071

n.9.1

 

1

 The five factors are:

(1) the level of economic control by the government;

(2) whether the entity’s profits go to the government;

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BENNETT V. BANK MELLI 9

Even after Congress added § 1605(a)(7) (now § 1605A)

to the FSIA in 1996, successful plaintiffs struggled to enforce

judgments against Iran when they were harmed by its terrorist

activities. See, e.g., In re Islamic Republic of Iran Terrorism

Litig., 659 F. Supp. 2d 31, 49–58 (D.D.C. 2009) (describing

“The Never-Ending Struggle to Enforce Judgments Against

Iran”). Once again, Congress responded by enacting new

statutes, this time designed to facilitate the satisfaction of

such judgments by expanding successful plaintiffs’ ability to

attach and execute on the property of agencies and

instrumentalities of terrorist states. Bank Markazi, 136 S. Ct.

at 1318.

First, in 2002, Congress enacted the Terrorism Risk

Insurance Act of 2002 (“TRIA”), Pub. L. No. 107-297, 116

Stat. 2322. Section 201(a) of the TRIA provides:

Notwithstanding any other provision of

law, and except as provided in subsection (b)

[of this note, pertaining to Presidential

waiver], in every case in which a person has

obtained a judgment against a terrorist party

on a claim based upon an act of terrorism, or

for which a terrorist party is not immune

(3) the degree to which government officials manage

the entity or otherwise have a hand in its daily affairs;

(4) whether the government is the real beneficiary of

the entity’s conduct; and (5) whether adherence to

separate identities would entitle the foreign state to

benefits in United States courts while avoiding its

obligations.

Flatow, 308 F.3d at 1071 n.9 (quoting Walter Fuller Aircraft Sales, Inc.

v. Republic of the Philippines, 965 F.2d 1375, 1380 n.7 (5th Cir. 1992)).

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10 BENNETT V. BANK MELLI

under section 1605A or 1605(a)(7) . . . , the

blocked assets[2] of that terrorist party

(including the blocked assets of any agency or

instrumentality of that terrorist party) shall be

subject to execution or attachment in aid of

execution in order to satisfy such judgment to

the extent of any compensatory damages for

which such terrorist party has been adjudged

liable.

TRIA § 201(a) was codified as a statutory note to 28 U.S.C.

§ 1610 on “Treatment of Terrorist Assets.”

Second, in 2008, Congress amended the FSIA as part of

the National Defense Authorization Act for Fiscal Year 2008,

Pub. L. No. 110-181, § 1083, 122 Stat. 3, 338. Among other

changes, Congress added a new subsection to the FSIA,

which provides in part that

the property of a foreign state against which a

judgment is entered under section 1605A, and

the property of an agency or instrumentality

of such a state, including property that is a

separate juridical entity or is an interest held

directly or indirectly in a separate juridical

entity, is subject to attachment in aid of

execution, and execution, upon that judgment

as provided in this section, regardless of [the

 

2

 “Blocked assets” refers to “any asset seized by the Executive Branch

pursuant to either the Trading With the Enemy Act or the International

Emergency Economic Powers Act. See TRIA § 201(d)(2).” Bank

Markazi, 135 S. Ct. at 1318 (citations omitted).

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BENNETT V. BANK MELLI 11

same five factors described by the federal

courts as the “Bancec factors”].

28 U.S.C. § 1610(g)(1); see also Bank Markazi, 136 S. Ct. at

1318 n.2. For ease of reference, we refer to this section as

“FSIA § 1610(g).”

FACTUAL AND PROCEDURAL HISTORY

Four groups of individuals sued the Islamic Republic of

Iran for damages arising from deaths and injuries suffered in

terrorist attacks sponsored by Iran; in each case, a final

money judgment was entered in favor of the plaintiffs and

against Iran. In Estate of Heiser v. Islamic Republic of Iran,

659 F. Supp. 2d 20 (D.D.C. 2009), and Estate of Heiser v.

Islamic Republic of Iran, 466 F. Supp. 2d 229 (D.D.C. 2006),

the plaintiffs secured judgments for more than $590 million

for the 1996 bombing of the Khobar Towers in Saudi Arabia. 

In Acosta v. Islamic Republic of Iran, 574 F. Supp. 2d 15

(D.D.C. 2008), the plaintiffs received a judgment of more

than $350 million because of a 1990 mass shooting. In

Bennett v. Islamic Republic of Iran, 507 F. Supp. 2d 117

(D.D.C. 2007), the plaintiffs obtained a judgment for

damages of nearly $13 million for Iran’s role in the 2002

bombing of a cafeteria at Hebrew University in Jerusalem. 

And in Greenbaum v. Islamic Republic of Iran, 451 F. Supp.

2d 90 (D.D.C. 2006), the plaintiffs were awarded almost $20

million for damages suffered as a result of the bombing of a

Jerusalem restaurant in 2001. Collectively, the judgments

total nearly $1 billion. Although all the judgments were

taken by default, it is undisputed that all are valid final

judgments and that Iran owes the amounts of those judgments

to the respective plaintiffs.

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12 BENNETT V. BANK MELLI

Bank Melli, Iran’s largest financial institution, is wholly

owned by the government of Iran. It is undisputed that Bank

Melli qualifies as an instrumentality of Iran under the FSIA. 

Bank Melli was not named as a defendant in any of the four

cases described above and was not itself alleged to have been

involved in the underlying terrorist events. On October 25,

2007, the United States Department of the Treasury, Office

of Foreign Assets Control exercised its authority under

Executive Order No. 13,382, 70 Fed. Reg. 38,567 (June 28,

2005), to block Bank Melli’s assets in the United States

because of its involvement in Iran’s nuclear and missile

industries. Bank Melli’s assets also are blocked pursuant to

a 2012 Executive Order blocking the property of Iran and of

Iranian financial institutions. Exec. Order No. 13,599,

77 Fed. Reg. 6659 (Feb. 8, 2012).3

Visa and Franklin owe about $17.6 million to Bank Melli

pursuant to a commercial relationship that involves the use of

Visa credit cards in Iran. Visa and Franklin have not turned

the funds over to Bank Melli only because the funds are

blocked. The Bennett judgment creditors filed a complaint

against Visa and Franklin, seeking to attach and execute

against the blocked assets. Visa and Franklin responded by

initiating this interpleader action, naming as defendants Bank

Melli and the three other sets of judgment creditors. Visa and

Franklin sought a determination of the rights to the blocked

assets in their possession and a discharge of Visa and

Franklin with regard to those assets. After Bank Melli

entered its appearance, it moved to dismiss the action.

3 The recent lifting of a portion of the sanctions imposed on Iran does

not render this interpleader action moot, nor does it affect our analysis of

the issues raised here.

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BENNETT V. BANK MELLI 13

Bank Melli made four arguments for dismissal, each of

which the district court rejected. The court held: (1) TRIA

§ 201(a) and FSIA § 1610(g) enable the judgment creditors

to attach the monies owed to Bank Melli; (2) TRIA § 201(a)

and FSIA § 1610(g) do not impose retroactive liability;

(3) the blocked assets constitute property of Bank Melli; and

(4) Bank Melli was not a required party under Federal Rule

of Civil Procedure 19. Bennett v. Islamic Republic of Iran,

927 F. Supp. 2d 833 (N.D. Cal. 2013). The district court

denied the motion to dismiss and certified the order for

interlocutory appeal under 28 U.S.C. § 1292(b). Bennett,

927 F. Supp. 2d at 845–46.

STANDARD OF REVIEW

We review de novo: questions of statutory construction,

Miranda v. Anchondo, 684 F.3d 844, 849 (9th Cir. 2012); a

district court’s ruling on a motion to dismiss for failure to

state a claim or for lack of subject matter jurisdiction, Colony

Cove Props., LLC v. City of Carson, 640 F.3d 948, 955 (9th

Cir. 2011); the question whether a statute may be applied

retroactively, Scott v. Boos, 215 F.3d 940, 942 (9th Cir.

2000); and legal determinations underlying a district court’s

decision whether an action can proceed in the absence of a

required party under Rule 19, Kescoli v. Babbitt, 101 F.3d

1304, 1309 (9th Cir. 1996).

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14 BENNETT V. BANK MELLI

DISCUSSION

A. TRIA § 201(a) and FSIA § 1610(g) permit attachment

and execution of the monies owed to Bank Melli.

1. TRIA § 201(a)

We hold that TRIA § 201(a) permits judgment creditors

to attach assets held by the instrumentalities of state sponsors

of terrorism. As always, when interpreting a statute, we

begin with its text. Metro One Telecomms., Inc. v. Comm’r,

704 F.3d 1057, 1061 (9th Cir. 2012). Section 201(a) of the

TRIA applies “[n]otwithstanding any other provision of law,”

“in every case in which a person has obtained a judgment

against a terrorist party on a claim based upon an act of

terrorism, or for which a terrorist party is not immune under

section 1605A or 1605(a)(7),” and “in order to satisfy such

judgment to the extent of any compensatory damages for

which such terrorist party has been adjudged liable.” TRIA

§ 201(a) (emphases added). The statute provides that, in

cases such as this one, “the blocked assets of [the] terrorist

party (including the blocked assets of any agency or

instrumentality of that terrorist party) shall be subject to

execution or attachment in aid of execution.” Id. (emphasis

added). This wording demonstrates that Congress knew that

the blocked assets of an instrumentalitymight otherwise have

been excluded from the phrase “blocked assets of [the]

terrorist party” and that Congress acted to ensure that,

instead, the instrumentality’s blocked assets were included. 

Cf. Alejandre v. Telefonica Larga Distancia de P.R., Inc.,

183 F.3d 1277, 1287, 1288 n.25 (11th Cir. 1999) (stating that

a proposed amendment to the FSIA that would have applied

to property that “belongs to an agency or instrumentality of

a foreign state” demonstrated that Congress “knows how to

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BENNETT V. BANK MELLI 15

express clearly an intent to make instrumentalities

substantively liable for the debts of their related foreign

governments” (internal quotation marks omitted)). 

Accordingly, we agree with the Second Circuit when it held

that it is “clear beyond cavil that Section 201(a) of the TRIA

provides courts with subject matter jurisdiction over postjudgment execution and attachment proceedings against

property held in the hands of an instrumentality of the

judgment-debtor, even if the instrumentality is not itself

named in the judgment.” Weinstein, 609 F.3d at 50.

Bank Melli disputes this reading of § 201(a), arguing

instead that it applies only to instrumentalities that are alter

egos of the state; that is, Bank Melli argues that the Bancec

presumption against the attachment of assets held by state

instrumentalities applies. Bank Melli reasons that, because

“including” is a term of illustration, the words that follow are

merely an example of the main preceding principle. That

observation is true but is of no assistance to Bank Melli. By

listing “the blocked assets of any . . . instrumentality of that

terrorist party” as a specific example of assets that are

“subject to execution or attachment . . . in order to satisfy” a

money judgment obtained under § 1605A or § 1605(a)(7),

Congress clearly instructed courts to allow the

instrumentality’s blocked assets to be reached. Congress also

instructed courts to allow these assets to be reached

“[n]otwithstanding any other provision of law”—that is,

regardless of the usual fiction embodied in Bancec. Congress

purposely overrode the Bancec presumption in this context

and abrogated attachment immunity with respect to the

blocked assets of instrumentalities of designated state

sponsors of terrorism. Section 201(a) permits the judgment

creditors to attach the assets of an instrumentality of a state

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16 BENNETT V. BANK MELLI

sponsor of terrorism. Accordingly, the blocked assets of

Bank Melli that are at issue in this case may be attached.

2. FSIA § 1610(g)

FSIA § 1610(g) allows attachment of and execution

against property held by a foreign terrorist state’s

instrumentality “that is a separate juridical entity,”

“regardless of” five factors. As noted above, those

enumerated factors are the same five factors identified by the

federal courts as the “Bancec factors” that may be used to

decide whether an instrumentality is an alter ego under

Bancec. E.g., Flatow, 308 F.3d at 1071–72, 1071 n.9. It is

clear from the text of the statute that Congress was referring

to, and abrogating, not just the presumption of separate

juridical status, but also Bancec specifically. Therefore,

§ 1610(g) also permits attachment in this case.

But Bank Melli contends that, because § 1610(g) makes

assets subject to attachment and execution only “as provided

in this section,” it is not an independent exception to the

immunity granted by 28 U.S.C. § 1609. Bank Melli reasons

that subsection (g) applies only if some other part of § 1610

provides for attachment and execution. Bank Melli argues

that its assets cannot be attached or executed upon because

the assets at issue in this case were not “used for a

commercial activity in the United States,” a requirement in

§ 1610(a), and Bank Melli has not itself “engaged in

commercial activity in the United States,” a requirement in

§ 1610(b). We are not persuaded.

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BENNETT V. BANK MELLI 17

We hold that subsection (g) contains a freestanding

provision for attaching and executing against assets of a

foreign state or its agencies or instrumentalities. Subsection

(g) covers a different subject than § 1610(a) through (e): by

its express terms, it applies only to “certain actions,”

specifically, judgments “entered under section 1605A.” 

(Emphasis added.) In turn, § 1605A revokes sovereign

immunity for damages claims against a foreign state for

personal injury or death caused by “torture, extrajudicial

killing, aircraft sabotage, hostage taking, or the provision of

material support” for such an act. By definition, such claims

do not arise from commercial activity; they arise from acts of

torture (and the like). Section 1610(g) requires only that a

judgment under § 1605A have been rendered against the

foreign state; in that event, both the property of the foreign

state and the property of an agency or instrumentality of that

state are subject to attachment and execution. See Peterson,

627 F.3d at 1123 n.2 (stating that § 1610(g) “expanded the

category of foreign sovereign property that can be attached;

judgment creditors can now reach any U.S. property in which

Iran has any interest, whereas before they could reach only

property belonging to Iran”). To the extent that subsection

(g) is inconsistent with subsection (a) or (b), subsection (g)

governs because the particular (judgments entered under

§ 1605A) controls over the general (all judgments entered

after a certain date). Morales v. Trans World Airlines, Inc.,

504 U.S. 374, 384–85 (1992).

When subsection (g) refers to attachment and execution

of the judgment “as provided in this section,” it is referring to

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18 BENNETT V. BANK MELLI

procedures contained in § 1610(f).4 Section 1610(f), like

§ 1610(g), relates to judgments obtained under § 1605A and

its predecessor, § 1605(a)(7). Subsection (f)(1)(A) permits

attachment and execution of property that might otherwise be

blocked; subsection (f)(1)(B) prohibits attachment or

execution against property of a foreign state that it

expropriated from a natural person; and subsection (f)(2)(A)

provides that the Secretary of State and Secretary of Treasury

will make every effort to assist a court or creditor in locating

property awarded pursuant to § 1605A. In light of Congress’

mandate to the executive branch to assist in the collection of

judgments in such cases, 28 U.S.C. § 1610(f), we cannot

impute to Congress an empty statutory gesture. See Gates v.

Syrian Arab Republic, 755 F.3d 568, 576 (7th Cir. 2014)

(stating that Congress intended the 2008 amendments to the

FSIA “to make it easier for terrorism victims to obtain

judgments and to attach assets”).5 Given both the text of the

 

4

 When Congress enacted subsection (g), subsection (f) already was in

place. Subsection (g) was added to the statute in 2008. Pub. L. No. 110-

181, div. A, tit. X, § 1083(b)(3), 122 Stat. 3, 341 (2008). Subsection (f)

was enacted in 1998. Pub. L. No. 105-277, § 101(h), 112 Stat. 2681-491

(1998).

5

In its Petition for Rehearing or Rehearing En Banc, Bank Melli argues

that our reading of the statute must be wrong because, in 2000, President

Clinton waived the enforcement of § 1610(f)(1); it reasons that “as

provided in this section” therefore cannot refer to § 1610(f). That

argument fails for at least three reasons. First, only subsection (f)(1) is

not being enforced. Pres. Determ. No. 2001-03, 65 Fed. Reg. 66,483 (Oct.

28, 2000). Several other parts of subsection (f)—described in text—have

always remained fully enforced, so subsection (g) refers, at a minimum,

to the enforced portions. Second, our search is only for congressional

intent when subsection (g) was enacted. A partial waiver does not reflect

congressional intent; if anything,it demonstrates presidential disagreement

with congressional intent. And non-enforcement by the executive branch

does not equal repeal by Congress; regardless of the partial waiver, all of

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BENNETT V. BANK MELLI 19

statute and Congress’ intention to make it easier for victims

of terrorism to recover judgments, we hold that § 1610(g) is

a freestanding provision for attaching and executing against

assets to satisfy a money judgment premised on a foreign

state’s act of terrorism.

Bank Melli argues, and our colleague agrees, that our

reading of § 1610(g) renders § 1610(a)(7) and (b)(3)

superfluous.6 But the tension works in the opposite direction. 

If § 1610(g) is interpreted to require that, to be subject to

attachment and execution, property must be used by the

foreign state for a “commercial activity,” § 1610(a), or that

the instrumentality must be “engaged in commercial activity

in the United States,” § 1610(b), then we would have to read

into § 1610(g) a limitation that Congress did not insert. See

United States v. Temple, 105 U.S. (9 Otto) 97, 99 (1881)

(holding that the court has “no right to insert words and

phrases, so as to incorporate in the statute a new and distinct

provision”). Section 1610(g)(1) provides that “the property

of a foreign state against which a judgment is entered under

subsection (f) remains the law. Third, the blinders-on, technical focus of

this argument loses sight of Congress’ main aim, which is for private

plaintiffs who suffered torture and obtained tort judgments to get their

money from terrorist states.

 

6

 Our colleague gives two other reasons for disagreeing with us on this

point. The first is that § 1610(b)(3) does not require property “to be

involved in terrorism to abrogate attachment immunity.” Partial dissent

at 36. We do not suggest to the contrary. The other reason is that it would

be “an unjustified and unfortunate result,” id. at 38, to allow attachment

and execution of non-commercial property, such as museum artifacts

belonging to Iran. But it is not our province to decide whether the policy

choices embodied in a statute are wise or unwise; our task is, rather, to

discern congressional intent. Day-Brite Lighting, Inc. v. Missouri,

342 U.S. 421, 423 (1952).

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20 BENNETT V. BANK MELLI

section 1605A, and the property of an agency or

instrumentality of such a state, . . . is subject to attachment in

aid of execution, and execution.” (Emphases added.) Thus,

Congress did not limit the type of property subject to

attachment and execution under § 1610(g) to property

connected to commercial activity in the United States. The

only requirement is that property be “the property of” the

foreign state or its instrumentality.

Two Seventh Circuit cases support our conclusion in this

regard. In Wyatt v. Syrian Arab Republic, 800 F.3d 331, 343

(7th Cir. 2015), cert. denied, 136 S. Ct. 1721 (2016), the court

held that the plaintiffs need not comply with § 1608(e) when

proceeding under § 1610(g). The court noted that § 1608(e)

is part of a “more general process” applicable to “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.” Id. at 333. Section 1610(g), the court

noted, “contains provisions specific to claims for statesponsored terrorism.” Id. Those specific provisions allow

plaintiffs with a judgment against a state sponsor of terrorism,

obtained pursuant to § 1605A, to attach and execute the

judgment against property of the foreign state and against

property of any agency and instrumentality of the state. Id.

The other provisions of § 1610, contained in subsections (a)

through (c), establish a general process for judgments against

a foreign state not necessarily resting on state-sponsored

terrorism. Id.

Similarly, the court held in Gates that a plaintiff

proceeding under § 1610(g) need not comply with § 1610(c). 

The court wrote in part:

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BENNETT V. BANK MELLI 21

Sections 1610(a) and (b) are available to

satisfy a wide variety of judgments, but they

allow attachment of only specific categories

of assets to satisfy those judgments. See, e.g.,

§ 1610(a) (allowing attachment of foreign

state property located in the United States and

used for commercial activity there); § 1610(b)

(allowing attachment of property of foreign

state agency or instrumentality engaged in

United States commercial activity).

By contrast, § 1610(g) is available only to

holders of judgments under the § 1605A

exception for state-sponsored terrorism, but it

allows attachment of a much broader range of

assets to satisfy those judgments.

Gates, 755 F.3d at 576.

Regardless of canons of construction—such as the

principle that a specific statute takes precedence over a

general one—our ultimate search is for congressional intent. 

Chickasaw Nation v. United States, 534 U.S. 84, 94 (2001). 

And it is quite clear that Congress meant to expand successful

plaintiffs’ options for collecting judgments against state

sponsors of terrorism.

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22 BENNETT V. BANK MELLI

We acknowledge that § 1610 as a whole is ambiguous.7

In that circumstance, we may consider legislative history. Id.

at 91–92; United States v. Pub. Utils. Comm’n, 345 U.S. 295,

315 (1953). That history suggests that § 1610(g) was meant

to allow attachment and execution with respect to any

propertywhatsoever of the foreign state or its instrumentality. 

Senator Lautenberg, one of the sponsors of the bill that

became § 1610(g), stated that the provision would “allow[]

attachment of the assets of a state sponsor of terrorism to be

made upon the satisfaction of a ‘simple ownership’ test.” 

154 Cong. Rec. S54-01 (Jan. 22, 2008) (statement of Sen.

Lautenberg). The House Conference Report for a

substantially similar earlier version of the bill noted that the

provision “would . . . expand the ability of claimants to seek

recourse against the property of that foreign state,” in part “by

permitting any property in which the foreign state has a

beneficial ownership to be subject to execution of that

7 We also acknowledge that the United States, appearing as amicus

curiae, disagrees with our interpretation. We are not required to defer to

the government’s view because, in deciding this case, we “are not being

asked to supplant a foreign policy decision of the political branches with

the courts’ own unmoored determination.” Zivotofsky ex rel. Zivotofsky

v. Clinton, 132 S. Ct. 1421, 1427 (2012). To the contrary, the executive

branch has approved the building blocks of the statutory criteria for

execution on the property in question, which we are applying in a routine

exercise of statutory interpretation: The President signed the legislation

that became § 1610(g), Pub. L. No. 110-181, President Bush Signs the

National Defense Authorization Act for Fiscal Year 2008, 2008

U.S.C.C.A.N. S3 (Jan. 28, 2008); the President has not sought to waive

enforcement as was done with respect to § 1610(f)(1); the Secretary of

State listed Iran as a terrorist state, 49 Fed. Reg. 2836-02 (Jan. 23, 1984);

and the President imposed monetary sanctions on Iran, Exec. Order No.

13,599, 77 Fed. Reg. 6659 (Feb. 5, 2012). And, finally, in “[e]nacting the

FSIA in 1976, Congress transferred from the Executive to the courts the

principal responsibility for determining a foreign state’s amenability to

suit.” Bank Markazi, 136 S. Ct. at 1329.

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BENNETT V. BANK MELLI 23

judgment.” H.R. Rep. No. 11-447, at 1001 (2007) (Conf.

Rep.). The bill, it continued, “is written to subject any

property interest in which the foreign state enjoys a beneficial

ownership to attachment and execution.” Id. We have

already noted that the basic purpose of adding § 1610(g) was

to enable plaintiffs who have established a foreign state’s

liability under § 1605A and its predecessor, for terrorist acts,

to collect on their judgments. As Senator Lautenberg put it,

the bill was meant “to facilitate victims’ collection of their

damages from state sponsors of terrorism.” 154 Cong. Rec.

S54-01 (Jan. 22, 2008) (statement of Sen. Lautenberg). Our

interpretation of § 1610(g) more fully furthers that

fundamental aim.

Bank Melli also makes three other arguments regarding

§ 1610(g). We can dispose of those arguments easily.

(1) The district court’s failure to discuss expressly

whether to grant Bank Melli discretionary relief under the

“innocent party” provision of § 1610(g)(3) does not mean that

the court failed to consider whether that provision applied. 

Bank Melli made its § 1610(g)(3) argument to the district

court, and we presume that the court understood its authority

but declined to exercise discretion in Bank Melli’s favor. Cf.

United States v. Davis, 264 F.3d 813, 816–17 (9th Cir. 2001)

(so holding in the context of a district court’s silence

regarding a requested downward departure under the United

States Sentencing Guidelines).

(2) There is no conflict between § 1610(g) and the 1955

Treaty of Amity between the United States and Iran, which

requires that the United States respect the juridical status of

Iranian companies, protect their property in accordance with

international law, and not discriminate against them. Treaty

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24 BENNETT V. BANK MELLI

of Amity, Economic Relations and Consular Rights Between

the United States of America and Iran, Aug. 15, 1955, 8

U.S.T. 899, 902–03. As the Second Circuit held, that treaty

provision is intended simply to ensure that foreign

corporations are on equal footing with domestic corporations. 

Weinstein, 609 F.3d at 53. Even if the two provisions were

inconsistent, when a treaty and a later-enacted federal statute

conflict, the subsequent statute controls to the extent of the

conflict. Breard v. Greene, 523 U.S. 371, 376 (1998) (per

curiam).

(3) Allowing the Heiser plaintiffs to obtain relief under

§ 1610(g) by converting their § 1605(a)(7) judgment to a

§ 1605A judgment does not violate separation of powers

principles. Bank Melli’s reliance on Plaut v. Spendthrift

Farm, Inc., 514 U.S. 211, 219 (1995), is misplaced. There,

the court held that Congress could not require federal courts

to reopen final judgments. But here, the judgment was not

reopened. Instead, the Heiser plaintiffs have a new collection

tool; they can enforce their final judgment against Iran by

attaching and executing on the property of Iran’s

instrumentality. In essence, the statute gives more effect to

the final judgment, rather than attempting to revise or rescind

that judgment.

B. The statutes do not impermissibly impose retroactive

liability.

Bank Melli next argues that the judgment creditors cannot

use TRIA § 201(a) or FSIA § 1610(g) because the terrorist

acts that underlie the judgments occurred before the

enactment of those statutes. The general default rule is that

a law that increases substantive liability for past conduct does

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BENNETT V. BANK MELLI 25

not operate retroactively. Landgraf v. USI Film Prods.,

511 U.S. 244, 280 (1994).

But the statutes do not impose new liability on Iran. 

Section 1605(a)(7) was in effect at the time of the terrorist

acts in question. Rather, the statutes simply permit additional

methods of collection. See id. at 275 (noting that the default

rule does not apply to rules of procedure because of

“diminished reliance interests”).

Even if TRIA § 201(a) and FSIA § 1610(g) are viewed as

imposing new liability retroactively, the default rule is

different for statutes that govern foreign sovereign immunity. 

In Altmann, 541 U.S. at 692, the Supreme Court concluded

that the Landgraf presumption does not apply to such statutes. 

To the contrary, when it comes to sovereign immunity for

both foreign states and their agencies and instrumentalities,

there is a presumption in favor of retroactivity “absent

contraindications” from Congress. Id. at 696.

Here, there are no such contraindications. In fact, the

opposite is true. The purpose of the statutes at issue was to

enable not just future litigants, but also current judgment

creditors to collect on the final judgments that they already

held—which, as a matter of logic, arose from past acts. 

Congress chose to make TRIA § 201(a) applicable in “every

case in which a person has obtained a judgment” under either

the former statute, § 1605(a)(7), or the current statute,

§ 1605A. TRIA § 201(a) (emphases added). Similarly,

Congress chose to make § 1610(g) applicable to all

judgments entered under § 1605A. Accordingly, these

statutes apply even if they are seen as imposing liability

retroactively, because Congress so intended.

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26 BENNETT V. BANK MELLI

C. The blocked assets are property of Bank Melli.

Bank Melli also contends that TRIA § 201(a) and FSIA

§ 1610(g) do not permit attachment of the assets here because

Visa and Franklin own the blocked assets; Bank Melli does

not. Under TRIA § 201(a), to be subject to execution or

attachment, the blocked assets must be “assets of” the

instrumentality. Similarly, § 1610(g) applies to “the property

of” the instrumentality.

Like most courts, we look to state law to determine the

ownership of assets in this context. Peterson, 627 F.3d at

1130–31; see also Calderon-Cardona v. Bank of N.Y. Mellon,

770 F.3d 993, 1000–01 (2d Cir. 2014) (looking to New York

law to determine what type of interest rendered property

attachable under § 1610(g)), cert. denied, 136 S. Ct. 893

(2016); Walker Int’l Holdings, Ltd. v. Republic of Congo,

415 F.3d 413, 415 (5th Cir. 2005) (applying Texas law to

determine attorney fees award in FSIA action); Hegna v.

Islamic Republic of Iran, 380 F.3d 1000, 1007 (7th Cir. 2004)

(applying Illinois law to decide whether property interest was

open to challenge in action under FSIA); Karaha Bodas Co.

v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara

(“Pertamina”), 313 F.3d 70, 83 (2d Cir. 2002) (applying

New York law to determine what actions are subject to

enforcement and available to judgment creditors). Here,

California law applies. As we held in Peterson, California

law authorizes a court to order a judgment debtor to assign to

the judgment creditor a right to payments that are due or will

become due, even if the right is conditioned on future

developments. 627 F.3d at 1130–31; Cal. Civ. Proc. Code

§ 482.080(a)(2) (providing that a court may order a defendant

subject to a writ of attachment to turn over either “evidence

of title to property of or a debt owed to the defendant”); id.

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BENNETT V. BANK MELLI 27

§ 680.310 (“’Property’ includes real and personal property

and any interest therein.”); id. § 708.210 (permitting a

judgment creditor to bring an action against a third party to

whom the judgment debtor owes money “to have the interest

or debt applied to the satisfaction of the money judgment”);

id. § 708.510(a) (authorizing a court to “order the judgment

debtor to assign to the judgment creditor . . . all or part of a

right to payment due”). That is precisely the situation in the

present case: Bank Melli has a contractual right to obtain

payments from Visa and Franklin. Under California law,

those assets are property of Bank Melli and may be assigned

to judgment creditors.

But even if federal law should govern this question, see

Heiser v. Islamic Republic of Iran, 735 F.3d 934, 940 (D.C.

Cir. 2013) (creating federal rule of decision to interpret

ownership requirements in FSIA, based in part on U.C.C.

Article 4A and common law principles), Bank Melli would

not succeed. Federal law and California law are aligned.

First, we note that Congress has used expansive wording

to suggest that immediate and outright ownership of assets is

not required. In the TRIA, Congress provided that “[n]othing

in this subsection shall bar . . . enforcement of any judgment

to which this subsection applies . . . against assets otherwise

available under this section or under any other provision of

law.” TRIA § 201(d)(4) (emphasis added). In FSIA

§ 1610(g), Congress specified that “the property of a foreign

state against which a judgment is entered under section

1605A, and the property of an agency or instrumentality of

such a state, including property that is a separate juridical

entity or is an interest held directly or indirectly in a separate

juridical entity, is subject to attachment in aid of execution,

and execution, upon that judgment as provided in this

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28 BENNETT V. BANK MELLI

section.” (Emphases added.) Thus, interests held by the

instrumentality of a terrorist state, as is the case here, are

subject to attachment under federal law.

Second, in Heiser, only foreign nationals, and not a

foreign country, had an interest in the blocked funds held by

intermediary banks. “Iranian entities were not the originators

of the funds transfers. Nor were they the ultimate

beneficiaries.” Heiser, 735 F.3d at 936 (footnote omitted). 

By contrast, here, Bank Melli isthe ultimate beneficiary; Visa

and Franklin owe money to Bank Melli for services rendered

pursuant to an agreement between them. Accordingly, Bank

Melli has an interest in the blocked assets.

In summary, California law applies. Under California

law, money owed to Bank Melli may be assigned to judgment

creditors. Even if federal law applies, under the Heiser

court’s rationale, attachment and execution are allowed here

because Bank Melli is the intended contractual beneficiary of

the contested funds.

D. Because Bank Melli does not enjoy sovereign

immunity, Rule 19 presents no barrier.

Finally, Bank Melli relies on Federal Rule of Civil

Procedure 19 to support its request for dismissal. That rule

provides that a person must be joined as a party if the person

“claims an interest relating to the subject of the action and is

so situated that disposing of the action in the person’s absence

may . . . impair or impede the person’s ability to protect the

interest.” Fed. R. Civ. P. 19(a). And, if the “person who is

required to be joined if feasible cannot be joined, the court

must determine whether, in equity and good conscience, the

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BENNETT V. BANK MELLI 29

action should proceed among the existing parties or should be

dismissed.” Fed. R. Civ. P. 19(b).

Bank Melli argues that this case must be dismissed

because it is a required party that cannot be joined and,

further, that the action cannot proceed without it “in equity

and good conscience.” But, because TRIA § 201(a) and

FSIA § 1610(g) confer jurisdiction by creating exceptions to

sovereign immunity, Bank Melli can be joined in this action. 

Thus it does not matter whether Bank Melli is otherwise a

required party under Rule 19(a); dismissal is not required. 

See 28 U.S.C. § 1330 (providing jurisdiction over a foreign

state or its instrumentality when it is not entitled to

immunity); Weinstein, 609 F.3d at 49–50 (holding that TRIA

§ 201(a) removes jurisdictional immunity, as well as

immunity from attachment and execution).8

According to Bank Melli, Republic of the Philippines v.

Pimentel, 553 U.S. 851 (2008), requires dismissal. We

disagree. A class of victims of human rights abuses in the

Republic of the Philippines won a $2 billion default judgment

against the Estate of Ferdinand Marcos, the former president

of that country. Id. at 857–58. The class attempted to

enforce the judgment by attaching assets owed to Merrill

8 Bank Melli’s citations to Ministry of Defense & Support for Armed

Forces of Islamic Republic of Iran v. Cubic Defense Systems, Inc.,

385 F.3d 1206 (9th Cir. 2004), vacated and remanded on other grounds

sub nom. Ministry of Def. & Support for Armed Forces of Islamic

Republic of Iran v. Elahi, 546 U.S. 450 (2006) (per curiam); and Peterson

v. Islamic Republic of Iran, 627 F.3d 1117 (9th Cir. 2010), are inapposite. 

Neither of those cases addressed the question whether TRIA § 201(a) or

FSIA § 1610(g) confers jurisdiction when property owned by a terrorist

state’s instrumentality is subject to execution in satisfaction of judgments

entered against that terrorist state.

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30 BENNETT V. BANK MELLI

Lynch by a bank incorporated by Marcos personally. Id. at

858. The Philippines claimed ownership of the bank, and

therefore the disputed assets, because the bank had been

incorporated through a misuse of public office. Id. The

Philippines also claimed immunity from the suit. Id. Merrill

Lynch initiated an interpleader action naming, among other

parties, the Republic of the Philippines and one of its

agencies. Id. at 845–55. The Supreme Court held that the

case should be dismissed because “it was improper [for the

district court] to issue a definitive holding regarding a

nonfrivolous, substantive claim made by an absent, required

entity that was entitled by its sovereign status to immunity

from suit.” Id. at 868.

This case plainly is distinguishable. In Pimentel, the

Republic was a required party that could not be joined

because of sovereign immunity. Here, Bank Melli does not

enjoy sovereign immunity, so it can be joined as a party,

whether or not it is a required party. Unlike the Republic in

Pimentel, therefore, Bank Melli is able to adjudicate its claim

to the contested assets.

CONCLUSION

We hold: (1) TRIA § 201(a) and FSIA § 1610(g)

authorize attachment and execution of the monies owed to

Bank Melli. (2) Those statutes do not impose liability

retroactively but, even if they are viewed as doing so,

Altmann establishes a presumption in favor of retroactivity

for statutes governing sovereign immunity, which is not

rebutted here. (3) California law governs the ownership

question; the blocked assets are property of Bank Melli under

principles of California law and, thus, are subject to

attachment and execution under TRIA § 201(a) and FSIA

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BENNETT V. BANK MELLI 31

§ 1610(g). The same result would obtain even if federal law

governed. (4) Because Bank Melli can be joined in this

action, the dismissal provision of Federal Rule of Civil

Procedure 19 does not apply.

AFFIRMED.

BENSON, Senior District Judge, concurring in part and

dissenting in part: 

I concur with the majority that § 201(a) of the Terrorism

Risk Insurance Act (“TRIA”) and § 1610 of the Foreign

Sovereign Immunities Act (“FSIA”) permit the judgment

creditors in this case to attach and execute against monies

owed to Bank Melli. However, I respectfully believe the

majority erred in finding § 1610(g) to be a freestanding

immunity exception under FSIA. In my view, judgment

creditors relying on § 1610(g) are able to proceed, regardless

of Bank Melli’s sovereign immunity, because the judgment

creditors have sufficiently alleged Bank Melli is engaged in

commerce in the United States within the meaning of

§ 1610(b)(3) of FSIA.

FSIA contains “extensive procedural protections for

foreign sovereigns in United States courts.” Wyatt v. Syrian

Arab Republic, 800 F.3d 331, 333 (7th Cir. 2015). 

Specifically, § 1609 of FSIA provides a general presumption

that property of a foreign state and the property of an

instrumentality or agency of a foreign state is immune from

execution and attachment in United States courts. See

28 U.S.C. § 1609; 28 U.S.C. § 1603(a). In turn, § 1610

provides a series of exceptions to this general rule.

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32 BENNETT V. BANK MELLI

Prior to 2008, § 1610 provided different rules for

attachment immunity depending on whether the party was

seeking immunity as the foreign state or as an agency or

instrumentality of a foreign state. Regarding foreign states,

§ 1610(a) denied immunity where: (1) a judgment creditor

obtained a judgment against the foreign state; (2) the property

of the foreign state is located in the United States; (3) the

property is used for “a commercial activity” in the United

States; and (4) one of § 1610(a)’s seven avenues for

abrogating immunity applied. See 28 U.S.C. § 1610(a). 

Similarly, with respect to agencies and instrumentalities,

§ 1610(b) denied immunity where: (1) a judgment creditor

obtained a judgment against an agency or instrumentality of

foreign state; (2) the agency or instrumentality is engaged in

commercial activity in the United States; (3) the property of

the agency or instrumentality is located in the United States;

and (4) one of § 1610(b)’s three avenues for abrogating

immunity applied. See 28 U.S.C. § 1610(b).

Prior to 2008, the judgment creditors in this case would

have been required to obtain a judgment against Bank Melli

to utilize the immunity waiver provisions under § 1610(b) to

attach Bank Melli’s property.

In 2008, Congress amended FSIA, adding § 1610(g) and

§ 1605A. National Defense Authorization Act for Fiscal

Year 2008, Pub. L. No. 110-181, § 1083, 122 Stat. 3, 338

(2008). The purpose of the amendments was to relax the

protections of § 1610 in cases of state sponsored terrorism to

“make it easier for terrorism victims to obtain judgments and

to attach assets.” Gates v. Syrian Arab Republic, 755 F.3d

568, 576 (7th Cir. 2014); In re Islamic Republic of Iran

Terrorism Litig., 659 F. Supp. 2d 31, 62 (D.D.C. 2009)

(noting, “these latest additions to . . . FSIA demonstrate that

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BENNETT V. BANK MELLI 33

Congress remains focused on eliminating those barriers that

have made it nearly impossible for plaintiffs in these actions

to execute civil judgments against Iran or other state sponsors

of terrorism”).

Under § 1610(g), if a judgment creditor obtains a

judgment under § 1605A, the property of the foreign state and

“the property of an agency or instrumentality of such a state,

including property that is a separate juridical entity . . . is

subject to attachment . . . and execution, upon that judgment

as provided in this section, regardless” of five factors. 

28 U.S.C. § 1610(g)(1) (emphasis added). The five factors

enumerated in § 1610(g)(A) through (E) reflect the Bancec

presumption, which requires this Court to treat government

entities established as separate juridical entities distinct from

their sovereigns. See First Nat’l City Bank v. Banco Para el

Comercio Exterior de Cuba, 462 U.S. 611, 620–21 (1983);

Flatow v. Islamic Republic of Iran, 308 F.3d 1065, 1071 n.9

(9th Cir. 2009) (outlining the Bancec factors (citing Walter

Fuller Aircraft Sales, Inc. v. Republic of the Philippines,

965 F.2d 1375, 1380 n.7 (5th Cir.1992))).

Section 1610(g) leads to two straightforward conclusions

under FSIA. First, if a party obtains a § 1605A judgment

against a state sponsor of terror, the Bancec presumption is

eliminated, which permits a court to attach and execute

against the property of the agency or instrumentality to satisfy

the judgments against the foreign state. See Estate of Heiser

v. Islamic Republic of Iran, 885 F. Supp. 2d 429, 442 (D.D.C.

2012) (“Section § 1610(g) subparagraphs (A)–(E) explicitly

prohibit consideration of each of the five Bancec

factors.”); aff'd sub nom. Heiser v. Islamic Republic of

Iran, 735 F.3d 934 (D.C. Cir. 2013). Second, the language

“as provided in this section” requires a judgment creditor to

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34 BENNETT V. BANK MELLI

find an existing mechanism of attachment under § 1610. 

Section 1610(g) does not create a new avenue for attachment

under FSIA; rather, § 1610(g) broadens the force of § 1610’s

existing avenues for attachment by eliminating the legal

fiction that Bank Melli is a separate juridical entity from Iran. 

In this case, judgment creditors relying on § 1610(g) may

proceed to attach Bank Melli’s propertybecause Bank Melli’s

property is not immune from attachment by virtue of

§ 1610(b)(3). Section 1610(b)(3) eliminates attachment

immunity if an agency or instrumentality is “engaged in

commercial activity in the United States” and “the judgment

relates to a claim for which the agency or instrumentality is

not immune by virtue of section 1605A of this chapter . . .

regardless of whether the property is or was involved in the

act upon which the claim is based.” 28 U.S.C. § 1610(b)(3). 

The judgment creditors can attach Bank Melli’s property

because: (1) the judgment creditors have obtained a judgment

against Iran pursuant to § 1605A; (2) § 1610(g) eliminates the

Bancec presumption, allowing this Court to attach and

execute against Bank Melli’s assets to satisfy the judgment

against Iran; and (3) the judgment creditors have sufficiently

plead that Bank Melli is engaged in commercial activity in

the United States.

Section 1603(c) of FSIA defines commercial activity as:

“either a regular course of commercial conduct or a particular

commercial transaction or act. The commercial character of

an activity shall be determined by reference to the nature of

the course of conduct or particular transaction or act, rather

than by reference to its purpose.” 28 U.S.C. § 1603(c)

(emphasis added). Bank Melli entered into a contract with an

American company to provide an American company a

commercial service. [ER, p. 82–83, ¶ 2; ER, p. 64, ¶ 16

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BENNETT V. BANK MELLI 35

(“Visa holds the Blocked Assets, funds due and owing by

contract to Bank Melli pursuant to a commercial relationship

with that bank . . .”).] At this stage in the litigation, the Court

can conclude that the judgment creditors relying on § 1610(g)

have sufficiently alleged Bank Melli is engaged in

commercial activity in the United States.

The majority disagrees with the aforementioned

interpretation and concludes that § 1610(g) creates a

freestanding immunity exception under FSIA. The majority

believes a § 1605A judgment creditor may attach Bank

Melli’s property regardless of any commercial component

under § 1610(a) or § 1610(b). In my view, respectfully, the

majority misses the mark in three important respects.

First, the majority erroneously finds that § 1610(g) is a

freestanding exception to immunity by concluding:

Subsection (g) covers a different subject than

§ 1610(a) through (e): by its express terms, it

applies only to ‘certain actions,’ specifically,

judgments ‘entered under section 1605A.’ 

(Emphasis added.) In turn, § 1605A revokes

sovereign immunity for damages claims

against a foreign state for personal injury or

death caused by ‘torture, extrajudicial killing,

aircraft sabotage, hostage taking, or the

provision of material support’ for such an act. 

By definition, such claims do not arise from

commercial activity; they arise from acts of

torture (and the like).

[Maj. Op., p. 17.] In doing so, the majority misinterprets the

operation of § 1610(a) and (b) waivers in the context of

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36 BENNETT V. BANK MELLI

§ 1605A judgments. Under § 1610(b)(3), a judgment creditor

can attach property where the instrumentality is engaged in

commercial activity in the United States. Furthermore,

§ 1610(b)(3) provides that attachment immunity is eliminated

“regardless of whether the property is or was involved with

the act upon which the claim is based.” 28 U.S.C.

§ 1610(b)(3) (emphasis added). Therefore, a § 1605A

judgment allows a judgment creditor to get immunity waived

for any property where the instrumentality is engaged in

commerce in the United States, regardless whether the

property was involved in the actions that gave rise to the

§ 1605A waiver of immunity against the foreign state. 

Therefore, Bank Melli’s property does not need to be

involved in terrorism to abrogate attachment immunity under

§ 1610(b)(3).

Second, the majority concludes that the “as provided in

this section” language found in § 1610(g) refers to the

procedural aspects of § 1610, namely § 1610(f). Fair enough. 

But, the majority’s conclusion does not mean the language

“as provided in this section” refers only to § 1610(f). Indeed,

the majority’s piecemeal reading of § 1610(g) renders other

portions of § 1610 inoperable. “It is ‘a cardinal principle of

statutory construction’ that ‘a statute ought, upon the whole,

to be so construed that, if it can be prevented, no clause,

sentence, or word shall be superfluous, void, or

insignificant.’” TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001)

(quoting Duncan v. Walker, 533 U.S. 167, 174 (2001)). This

Court should adopt the interpretation of § 1610 that “‘gives

effect to every clause and word.’” Marx v. Gen. Revenue

Corp., ___U.S.___, 133 S. Ct. 1166, 1177 (2013) (citing

Microsoft Corp. v. i4i Ltd. P’ship, 564 U.S. 91 (2011)).

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BENNETT V. BANK MELLI 37

The majority ignores the avenues for exemption under

§ 1610(a)(7) and § 1610(b)(3). Section 1610(a)(7) and

§ 1610(b)(3) provide immunity, in addition to requiring some

interplay with commerce, where “the judgment relates to a

claim for which the foreign state is not immune under section

1605A . . . .” If a § 1605A judgment creditor can waive

attachment immunity under § 1610(g) without proving the

property is used in commerce or the instrumentality is

engaged in commerce in the United States, § 1610(a)(7) and

§ 1610(b)(3) are rendered superfluous and obsolete. 

Conversely, recognizing § 1610(g)’s limited purpose was to

eliminate the Bancec presumption ensures this Court gives

effect to every clause and word in § 1610 while honoring the

purpose of the 2008 FSIA amendments.

Finally, the majority’s holding ignores the practical

limitation the commerce requirement places on § 1605A

judgments. Reading § 1610(g) as a freestanding immunity

exception does not just relax FSIA in the context of

terrorism—it eliminates any immunity protection under FSIA

for state sponsors of terror and their instrumentalities. For

example, in Rubin v. Islamic Republic of Iran, American

citizens sued and obtained default judgments against Iran for

injuries and losses that arose out of a suicide bombing carried

out by Hamas in Israel. 33 F. Supp. 3d 1003, 1006 (N.D. Ill.

2014). The Rubin plaintiffs sought to “attach and execute on

numerous ancient Persian artifacts” in possession of two

museums in the United States to satisfy their default

judgments against Iran. Id. Like the judgment creditors in

this case, the Rubin plaintiffs argued that § 1610(g) is a

freestanding immunity exception and, therefore, the plaintiffs

may attach Iran’s artifacts to satisfy their judgments. Id. at

1013.

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38 BENNETT V. BANK MELLI

The court disagreed, finding: “The plain language

indicates that Section 1610(g) is not a separate basis of

attachment, but rather qualifies the previous subsections.” Id.

The court concluded, “the purpose of Section 1610(g) is to

counteract the Supreme Court’s decision in Bancec, and to

allow execution against the assets of separate juridical entities

regardless of the protections Bancec may have offered.” Id.

Currently, the Rubin case is pending appeal in the Seventh

Circuit. Rubin v. Islamic Republic of Iran, 33 F. Supp. 3d

1003 (N.D. Ill. 2014), appeal docketed, No. 14-1935 (7th Cir.

Apr. 25, 2014).

Surely this Court’s holding will be argued as precedent to

allow the Rubin plaintiffs to seize Persian artifacts to be

auctioned off to satisfy the Rubin plaintiffs’ default

judgments. This would be an unjustified and unfortunate

result. When Congress amended FSIA, the intention was to

eliminate the Bancec presumption and relax the rigidity of

§ 1610 to make it easier for victims of terrorism to satisfy

judgments against state sponsors of terror. Congress did not,

however, intend to open the floodgates and allow terrorism

plaintiffs to attach any and all Iranian property in the United

States. Rather, Congress intended the commerce limitation

to remain in place.1 If a foreign state is designated as a state

sponsor of terror, the state and the instrumentalities and

agencies of the state lose the privilege of doing business in

1 TRIA § 201 similarly contains a limitation on attachment and

execution. TRIA § 201 requires attachable assets to be defined as

“blocked assets.” Section 201(d)(2)(A) defines a “blocked asset” as any

asset “seized or frozen by the United States under section 5(b) of the

Trading With the Enemy Act (50 U.S.C. App. 5(b)) or under sections 202

and 203 of the International Emergency Economic Powers Act (50 U.S.C.

1701; 1702).”

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BENNETT V. BANK MELLI 39

the United States without running the risk of property being

seized to satisfy judgments.

In sum, I would require judgment creditors relying on

§ 1610(g) to satisfy one of § 1610’s existing avenues for

abrogating attachment immunity. In this case, the judgment

creditors have done that. The judgment creditors have

sufficiently alleged Bank Melli is engaged in commerce in

the United States within the meaning of § 1610(b)(3).

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