Opinion ID: 513426
Heading Depth: 1
Heading Rank: 1

Heading: jurisdiction

Text: 12 The United States, as noted, severed diplomatic relations with Iran in 1980. In addition, NPC and Amicus concede that the President has never formally recognized the Khomeini government of Iran. The district court relied on a letter from the Assistant Legal Advisor for Management of the Department of State clarifying Iran's diplomatic status in connection with Iran Handicraft & Carpet Export Center v. Marjan Int'l Corp., 655 F.Supp. 1275 (S.D.N.Y.1987). The letter, dated December 26, 1985, stated in part: 13 In response to your letter of December 13, 1985, the questions you posed and the answers of the State Department are as follows: 14 1. Has the United States recognized the Khomeini government of the Islamic Republic of Iran? 15 Answer: No. 16 Id. at 1280 n. 4. Amicus contends that this response referred merely to the absence of formal recognition and was not intended to foreclose courts from entertaining suits by the Khomeini regime. NPC and Amicus argue that the Executive Branch has not prohibited the Khomeini regime's access to federal courts, and that the Executive Branch may recognize a government for the purposes of bringing suit despite the absence of formal recognition. 17 Appellees assert, to the contrary, that unlike diplomatic relations, the President's formal statement of recognition of a foreign government is a necessary condition to permitting it to sue in federal court. Certain language in the Supreme Court's decisions arguably supports such a requirement. See, e.g., Sabbatino, 376 U.S. at 410, 84 S.Ct. at 931 ([T]he refusal to recognize has a unique legal aspect. It signifies this country's unwillingness to acknowledge that the government in question speaks ... for the territory it purports to control.) (citations omitted); Guaranty Trust, 304 U.S. at 137, 58 S.Ct. at 791 ([I]n conformity to generally accepted principles, the Soviet Government could not maintain a suit in our courts before its recognition by the political department of the Government.). Thus, appellees urge that NPC must be denied access to federal court based on the President's failure to extend formal recognition to the Khomeini government. We disagree and hold that the absence of formal recognition does not necessarily result in a foreign government being barred from access to United States courts. 18 Two reasons support this holding. First, as this century draws to a close, the practice of extending formal recognition to new governments has altered: The United States Department of State has sometimes refrained from announcing recognition of a new government because grants of recognition have been misinterpreted as pronouncements of approval. See 77 State Dep't Bull. 462-63 (Oct. 10, 1977) (In recent years, U.S. practice has been to deemphasize and avoid the use of recognition in cases of changes of governments....); Restatement 3d Sec. 203, reporter's note 1 (commenting on recent deemphasis of formal recognition). As a result, the absence of formal recognition cannot serve as the touchstone for determining whether the Executive Branch has recognized a foreign nation for the purpose of granting that government access to United States courts. 19 Second, the power to deal with foreign nations outside the bounds of formal recognition is essential to a president's implied power to maintain international relations. Cf. United States v. Curtiss-Wright Export Corp., 299 U.S. 304, 318-20, 57 S.Ct. 216, 220-21, 81 L.Ed. 255 (1936). As part of this power, the Executive Branch must have the latitude to permit a foreign nation access to U.S. courts, even if that nation is not formally recognized by the U.S. government. This is because the president alone--as the constitutional guardian of foreign policy--knows what action is necessary to effectuate American relations with foreign governments. Cf. Sabbatino, 376 U.S. at 411 n. 12, 84 S.Ct. at 931 n. 12 (citing criticisms of any policy which would mandate formal recognition before a foreign nation could sue in U.S. courts). 20 This case serves as an excellent example. Relations between the United States and Iran over the past eight years have been less than friendly. Yet, the status of that relationship has not been unchanging. There have been periods of improvement, for example, release of the embassy hostages, and periods of worsening relations, most recently occasioned by the unfortunate downing of an Iranian civilian airliner by the U.S.S. Vincennes. It is evident that in today's topsy-turvy world governments can topple and relationships can change in a moment. The Executive Branch must therefore have broad, unfettered discretion in matters involving such sensitive, fast-changing, and complex foreign relationships. See Guaranty Trust, 304 U.S. at 137, 58 S.Ct. at 791 (What government is to be regarded here as representative of a foreign sovereign state is a political rather than a judicial question, and is to be determined by the political department of the government.); Sabbatino, 376 U.S. at 410, 84 S.Ct. at 931 (This Court would hardly be competent to undertake assessments of varying degrees of friendliness or its absence....); Curtiss-Wright, 299 U.S. at 319, 57 S.Ct. at 220 (In this vast external realm, with its important, complicated, delicate and manifold problems, the President alone has the power to speak or listen as a representative of the nation.). B. Deference to the Executive Branch 21 Determining that formal recognition is not necessary for Iran to gain access to U.S. courts does not end our inquiry. We must also consider whether the Executive Branch--despite its withholding of formal recognition--has evinced a willingness to permit Iran to litigate its claims in the U.S. forum. Several facts persuasively indicate such a willingness. For example, Iran and the United States entered into the Algerian Accords to resolve the embassy personnel hostage crisis; an ongoing Iran-United States Claims Tribunal at the Hague continues to adjudicate disputes between the two countries; and the 1955 Treaty of Amity, Economic Relations and Consular Rights between the United States and Iran remains in full force and effect. Standing alone, none of these indicia of Executive Branch willingness to allow Iran to proceed as a plaintiff in the United States courts would necessarily persuade us to reverse the district court and grant access. Considering these factors in the aggregate, and not in isolation, as integral components of the United States overall relationship to Iran, the above recited connections strongly suggest that the Executive Branch has evinced an implicit willingness to permit the government of Iran to avail itself of a federal forum. 22 It is unnecessary to go further in examining other treaties, documents, or ties in order to ascertain the Executive Branch's intentions regarding Iran's access to the federal courts. The United States has submitted a Statement of Interest pursuant to 28 U.S.C. Sec. 517 (1982) stating that it is the position of the Executive Branch that the Iranian government and its instrumentality should be afforded access to our courts for purposes of resolution of the instant dispute. Because this Statement was not filed with Judge Owen, he was not apprised of the Executive Branch's position prior to ruling. 23 Appellees protest that for us to defer to what they term an ad hoc, pro hac vice directive to allow NPC's suit will encourage arbitrary and unpredictable pronouncements on the status of foreign governments, but we need not reach that question here because there is no indication that this is an arbitrary or ad hoc directive. This is not a case where the Executive Branch is attempting to prohibit a formally recognized government from bringing a single suit in the United States courts, nor is it a case where the Executive is arbitrarily allowing some suits by an unrecognized nation while disallowing others. Rather, here the Executive Branch--after entering into treaties with Iran, after establishing a claims tribunal to adjudicate disputes between the two countries, and after complying with U.S.-Iran agreements--expressly entered this case as Amicus requesting that Iran be given access to our courts. Under such circumstances, and as the sole branch authorized to conduct relations with foreign countries, the Executive clearly did not act arbitrarily. Accordingly, we hold that, for all the reasons stated, NPC must be permitted to proceed with its diversity suit in the Southern District of New York. IV 24 The judgment of the district court dismissing NPC's complaint is reversed, the complaint is reinstated and the matter is remanded to the district court for further proceedings.