Opinion ID: 3032245
Heading Depth: 2
Heading Rank: 4

Heading: The Legality of a Damages Remedy

Text: [8] Federal and California law, as explicated above, would bar an American court from ordering Goe to pay Arshian pursuant to the illegal guarantees. Such a payment would violate the precise terms of the Executive Order, which prohibit “any transaction or dealing by a United States person . . . related to . . . goods or services of Iranian origin” and “any new investment by a United States person in Iran.” Order § 2(d) & d(i), (c). A payment from Goe to Arshian would provide funds to the Iranian economy, paying for goods in Iran. As such, it would violate both the letter of the Executive Order and its fundamental purposes. That a court-ordered payment from Goe to Arshian would violate the Executive Order is supported by the inclusion in 31 C.F.R. § 560.510 of special authorization for licensing of certain damages awards by courts and other tribunals that would otherwise violate the Executive Order. The regulation allows “specific licenses [to] be issued on a case-by-case basis” for “transactions in connection with . . . awards, orders, or decisions of an administrative, judicial or arbitral proceeding in the United States or abroad, where the proceeding involves the enforcement of awards, decisions or orders of [the Iran-United States Claims Tribunal in The Hague, the International Court of Justice, or other international tribunals].” 31 C.F.R. § 560.510(a); see also id. § 560.510(d) & (d)(1) (“The following are authorized: All transactions related 7108 BASSIDJI v. GOE to payment of awards of the Iran-United States Claims Tribunal in The Hague against Iran.”). It also permits “[a]ll transactions necessary to the payment and implementation of awards . . . in a legal proceeding to which the United States Government is a party, or to payments pursuant to settlement agreements entered into by the United States Government in such a legal proceeding.” Id. § 560.510(d)(2). By authorizing courts to enforce some litigation remedies that would otherwise violate the Executive Order, this regulation suggests that, but for the exceptions listed, United States courts may not order, as remedies, payments of the type requested in this case, where the ensuing transaction would violate the Executive Order. [9] Arshian’s assignment of the guarantee to Bassidji does not change this straightforward application of Kaiser Steel. In general, an assignee does not sue in its own right, but rather stands in the shoes of its assignor. See, e.g., Misic v. Bldg. Serv. Employees Health & Welfare Trust, 789 F.2d 1374, 1378 (9th Cir. 1986) (per curiam) (applying the principle under federal law); see also Nat’l Steel Corp. v. Golden Eagle Ins. Co., 121 F.3d 496, 502 (9th Cir. 1997) (applying California law). Bassidji explicitly accepts this general rule, stating in his brief: Mr. Goe believes that an Iranian citizen could not secure justice in the United States courts without violating President Clinton’s Executive Order; thus, he posits, an assignee cannot secure justice either. To the extent that Mr. Goe is simply reciting the general rule that an assignee stands in the shoes of his assignor, we wholly agree. But . . . the law does not in any way bar Mr. Arshian from appearing and seeking justice in the United States courts. It naturally follows that Mr. Arshian’s assignee may also appear and seek justice. BASSIDJI v. GOE 7109 [10] Thus, no damages remedy can be provided to Bassidji by an American court. The “shoes” in which he stands make his claim repugnant to the Executive Order. Goe could not be ordered to pay Arshian; therefore, a payment to Arshian’s assignee is also prohibited.