Court Opinion

ID: 2667149
Source: CourtListenerOpinion
Date Created: 2014-04-04 13:22:03.216474+00
Date Added: 2024-06-11T13:23:22.013638
License: Public Domain

UNITED STATES DISTRICT COURT
                           FOR THE DISTRICT OF COLUMBIA

                                                 )
ESTATE OF MICHAEL HEISER, et al.,                )
                                                 )
       Plaintiffs,                               )
                                                 )
               v.                                )
                                                 )
ISLAMIC REPUBLIC OF IRAN, et al.,                )           00-CV-2329 (RCL)
                                                 )
       Defendants.                               )
                                                 )           Consolidated With
                                                 )
ESTATE OF MILLARD D. CAMPBELL,                   )
et al.,                                          )           01-CV-2104 (RCL)
                                                 )
       Plaintiffs,                               )
                                                 )
               v.                                )
                                                 )
ISLAMIC REPUBLIC OF IRAN, et al.,                )
                                                 )
       Defendants.                               )
                                                 )

                                 MEMORANDUM OPINION

       These postjudgment consolidated actions arise from the 1996 terrorist bombing of the

Khobar Towers, a residential complex on a United States military base in Dhahran, Saudi

Arabia. See Heiser v. Islamic Republic of Iran, 466 F. Supp. 2d 229 (D.D.C. 2006) (Lamberth,

J.). The plaintiffs are the family members and estates of 17 of the 19 United States Air Force

officers and airmen killed in the attack. The defendants are the Islamic Republic of Iran (“Iran”),

the Iranian Ministry of Information and Security (MOIS), and the Iranian Islamic Revolutionary

Guard Corps (IRGC). These cases were filed in September 2000 and October 2001,

                                               -1-
respectively, under the state-sponsored terrorism exception to the Foreign Sovereign Immunities

Act (FSIA) and the Flatow Amendment. See Mandatory Victims Restitution Act of 1996, Pub.

L. No. 104-132, tit. II, sec. 221(a)(1)(C), § 7, 110 Stat. 1214, 1241 (former FSIA terrorism

exception previously codified at 28 U.S.C. § 1605(a)(7)), repealed by National Defense

Authorization Act for Fiscal Year 2008, Pub. L. No. 110-181, § 1083(b)(1)(A)(iii), 122 Stat. 3,

338, (hereinafter 2008 NDAA); see also § 1605 note.

       While these cases were still pending, the D.C. Circuit Court of Appeals issued an opinion

in Cicippio-Puleo v. Islamic Republic of Iran in which the Court held that “neither section

1605(a)(7) nor the Flatow Amendment, separately or together, establishes a cause of action

against foreign state sponsors of terrorism.” 353 F.3d 1024, 1027 (D.C. Cir. 2004); accord

Acree v. Republic of Iraq, 370 F.3d 41, 58 (D.C. Cir. 2004). Following that ruling, this Court

determined that plaintiffs in cases under the FSIA terrorism exception, § 1605(a)(7), may use

that provision as a “pass-through” to causes of action found in state law. See, e.g., Bodoff v.

Islamic Republic of Iran, 424 F. Supp. 2d 74, 83 (D.D.C. 2006) (Lamberth, J.). Another

consequence of the Cicippio-Puleo decision was that the Flatow Amendment, § 1605 note, could

not itself serve as a basis punitive damages awards against Iran. Because the Court of Appeals

found that the amendment was not intended to provide for claims against foreign states, see id. at

1027, the bar on punitive damages in § 1606 of the FSIA remained, even against state sponsors

of terrorism.

       Following Cicippio-Puleo, plaintiffs filed an amended complaint in which they made

claims based on the state law of the jurisdictions where they were domiciled at the time of the

Khobar Towers attack. See 466 F. Supp. 2d 250-251. This Court ultimately found that most

plaintiffs had proven their right to relief in accordance with the applicable sources of state law,

                                                -2-
and, on December 22, 2006, this Court entered Default Judgment in favor of most Plaintiffs,

awarding economic and compensatory damages totaling $254,431,903.00. 466 F. Supp. 2d at

356-360. Certain sources of state law, however, either precluded a number of estates and

individual plaintiffs from presenting valid claims or otherwise limited the relief available to

those plaintiffs. Additionally, the Court was not able to award punitive damages.

       A little over a year later, the President signed the 2008 NDAA, which repealed

§ 1605(a)(7) and replaced that provision with a new version of the terrorism exception, § 1605A.

See Pub. L. No. 110-181, § 1083, 122 Stat. 3, 338. While this new FSIA enactment is more

advantageous to plaintiffs in many significant respects, what is most important for the purpose of

today’s decision is that § 1605A abrogates Cicippio-Puleo by establishing a federal cause of

action against state sponsors of terrorism and provides that punitive damages may be awarded in

those actions. See 1605A(c); see also Simon v. Republic of Iraq, 529 F.3d 1187, 1190 (D.C. Cir.

2008), rev’d sub nom. on other grounds, Republic of Iraq v. Beaty, 129 S.Ct. 2138 (2009). Thus,

plaintiffs proceeding under § 1605A can forgo the pass-through approach that controlled in the

wake of Cicippio-Puleo and may assert claims on the basis of the new federal statute alone.

       Notably, Congress directed that this new terrorism exception, § 1605A, may be applied

retroactively to a broad range of cases, provided certain conditions are satisfied. See § 1083(c).

In March 2008, plaintiffs filed a Motion for Supplemental Relief in which they requested that

this Court apply § 1605A retroactively to their actions and award additional damages, including

650 million dollars in punitive damages, against Iran. See Dk. # 127. On March 13, 2009, this

Court determined that plaintiffs’ actions satisfied the conditions for retroactive application of

§ 1605A and issued an order indicating that plaintiffs were entitled to proceed before this Court

                                                -3-
under the terms of the new law. 1 See Dk. # 143. At that time, however, the Court did not

determine what additional damages the plaintiffs were entitled to under the new terrorism

exception, § 1605A, but took the matter under advisement, intending to take a closer look at the

evidence and supplemental briefing in support of plaintiffs’ new claims for money damages

under federal law. Having reviewed the record in light of plaintiffs’ arguments for additional

relief under the terms of § 1605A, this Court now finds in favor of plaintiffs on all claims.

                                       I.      ANALYSIS

       Because § 1605A abrogates Cicippio-Puleo by creating a federal cause of action with

punitive damages, this Court returns to this Circuit’s pre-2004 interpretation of the terrorism

exception. Of course, as a result, the Court must again consider the complicated question of

what principles of law it should apply to these claims sounding in tort. On the one hand, because

these actions arise solely from statutory rights, they are not in theory matters of “federal common

law.” Yet, because federal courts must evaluate the extent and nature of the claims in these

       1
          At least one judge of this Court has held that new claims under § 1605A “must be
served on a defaulting party under Federal Rule of Civil Procedure 5(a)(2),” even when, as here,
the new claims are presented on motion pursuant to § 1083(c)(2). Gates v. Syrian Arab
Republic, No. 06-CV-1500 (RMC), 2009 WL 2562660 (D.D.C. Aug. 20, 2009) (Collyer, J.).
This Court respectfully disagrees. Rule 5(a)(2) states: “No service is required on a party who is
in default for failing to appear. But a pleading that asserts a new claim for relief against such a
party must be served on that party under Rule 4.” FED. R. CIV. P. 5(a)(2) (emphasis added).
Thus, Rule 5(a)(2) addresses only new claims presented in “pleadings,” and, in this action,
plaintiffs are proceeding not by way of pleading, but on motion in accordance with § 1083(c)(2).
Notably, in the Federal Rules of Civil Procedure, only the following kinds of documents
constitute pleadings: “(1) a complaint; (2) an answer to a complaint; (3) an answer to a
counterclaim designated as a counterclaim; (4) an answer to a crossclaim; (5) a third-party
complaint; (6) an answer to a third-party complaint; and (7) if the court orders one, a reply to an
answer.” FED R. CIV P. 7(a). In contrast, a motion—excluded from the 7(a) list of pleadings and
defined separately, under (b)—is generally “a request for a court order.” FED. R. CIV. P. 7(b).
For more on this issue, see the Court’s omnibus opinion, In Re: Islamic Republic of Terrorism
Litigation, issued this date.
                                                -4-
actions, courts are forced, in practice, to apply general principles of tort law—an approach that in

effect looks no different from one that explicitly applies federal common law. The Court of

Appeals addressed this difficulty in Bettis v. Islamic Republic of Iran:

                We recognize that some of the cases addressing these FSIA claims refer to
        “federal common law. . . .” The term “federal common law” seems to us to be a
        misnomer. Indeed, it is a mistake, we think, to label actions under the FSIA and
        Flatow Amendment for solatium damages as “federal common law” cases, for
        these actions are based on statutory rights. . . . Rather, . . . because the FSIA
        instructs that “the foreign state shall be liable in the same manner and to the same
        extent as a private individual under like circumstances,” 28 U.S.C. § 1606, it in
        effect instructs federal judges to find the relevant law, not to make it.

315 F.3d 325, 333 (D.C. Cir. 2003). To this end, courts have often looked to sources such as

state decisional law, legal treatises, or the Restatements in order to find and apply what are

generally considered to be the well-established standards of state common law, a method of

evaluation which mirrors—but is distinct from—the “federal common law” approach.

        That the Court must proceed in this manner is necessary for several reasons. First, in

establishing both subject-matter jurisdiction and federal causes of action for personal injury or

death resulting from state-sponsored terrorism, Congress intended that the terrorism exception

authorize “federal courts [to] create coherent national standards to support this initiative of

national significance,” Flatow v. Islamic Republic of Iran, 999 F. Supp. 1, 15 (D.D.C. 1998)

(Lamberth, J.)—a purpose which, following Cicippio-Puleo, Congress made more explicit in the

2008 NDAA. Second, because courts have an “interest [in] promoting uniformity of

determinations with respect to the liability of foreign states for the terrorist acts of its officials,

agents, and employees,” the generally accepted legal standards of the states provide the only

steady foundation for the rules of decision. Id. While applying these common-law standards,

however, the Court also keeps in mind the remedial purpose of the terrorism exception statute—

namely, to compensate victims for the losses suffered as a result of state-sponsored terrorism.
                                              -5-
Flatow, 999 F. Supp. at 13. Yet, as the Court of Appeals noted in Bettis, “this fact is not a

license for judges to legislate from the bench,” for “[a]s much as we sympathize with appellants’

claims, we have no authority to stretch the law beyond its clear bounds to satisfy our sense of

justice.” 315 F.3d at 338, 336.

       Mindful of these considerations, this Court will now address the three categories of

economic and compensatory damage claims that, in the original action, were either barred or

severely restricted as a result of the pre-2008 NDAA application of state law of each plaintiff’s

domicile: (A) those barred or limited by state minimum-age, surviving-spouse-or-lineal-

descendant, or sibling-financial-dependency requirements, (B) those barred by state “presence”

requirements, and (C) those barred by state “immediate family” rules. Finally, the court will

consider the plaintiffs’ request for an award of punitive damages.

A.     PLAINTIFFS NEGATIVELY AFFECTED BY STATE MINIMUM-AGE,
       SURVIVING-SPOUSE-OR-LINEAL-DESCENDANTS, AND SIBLING-
       FINANCIAL-DEPENDENCY REQUIREMENTS

       In its original Heiser opinion, this Court denied certain plaintiffs’ request for economic

damages in the form of lost wages and future earnings, because, under the state law of the

victims’ domicile when the attack occurred (Florida), the estates of decedents younger than 25

years of age and without a surviving spouse or surviving lineal descendants cannot recover. 466

F. Supp. 2d at 278 (citing Fla. Stat. Ann. § 768.21(6)(a)(1)). 2 Additionally, the Court limited

recovery for another plaintiff, because he had failed, under New Hampshire law, to prove

financial dependency on the decedent, his brother. These plaintiffs now rest their claims on the

       2
         These plaintiffs are the Estate of Justin Wood; the Estate of Earl Cartrette, Jr.; the Estate
of Brian McVeigh; the Estate of Joseph Rimkus; the Estate of Jeremy Taylor; and the Estate of
Peter Morgera.
                                                 -6-
2008 NDAA, which provides a federal cause of action for wrongful death. Therefore, this Court

will now consider their request for economic damages in light of traditional state-adopted

principles of tort law, rather than—as was the practice under the old pass-through approach—

simply the explicit requirements of the relevant state wrongful death statute.

       Though the 2008 NDAA does not define the scope of this particular federal cause of

action, “typically, a wrongful death statute is designed to compensate decedent’s heirs-at-law for

economic losses which result from decedent's premature death.” Flatow, 999 F. Supp. at 27. In

Flatow, this Court cited the District of Columbia’s wrongful death law as one representative of

most state statutes. Following Flatow, many federal judges have done likewise. See, e.g.,

Stethem, 201 F. Supp. 2d 78 (D.D.C. 2002) (Jackson, J); Wagner v. Islamic Republic of Iran, 172

F. Supp. 2d 128 (D.D.C 2001) (Jackson, J.). This Court is unaware of any pre-Cicippio-Puleo

terrorism exception case that has both affirmed a plaintiff’s wrongful death claim and—because

the deceased family member had been (1) under the age of 25, (2) without a surviving spouse or

lineal descendants, or (3) not financially responsible for his or her sibling—denied the attendant

request for economic damages. To the contrary, several decisions of this Court have awarded

economic damages to plaintiffs not meeting those conditions. See, e.g., Stethem, 201 F. Supp. 2d

at 87 (awarding economic damages to the Estate of Robert Stethem, including non-dependent

siblings, despite the fact that decedent had been under 25 years of age and without a surviving

spouse or lineal descendants; Eisenfeld v. Islamic Republic of Iran, 172 F. Supp. 2d 1, 8 (D.D.C.

2000) (Lamberth, J.) (awarding economic damages to the Estate of Sara Rachel Duker, though

decedent had been under 25 years of age and without a surviving spouse or lineal descendants).

                                               -7-
       Therefore, consistent with pre-Cicippio-Puelo precedent and mindful of the general aims

of most state wrongful death statutes, this Court will grant these plaintiffs their requests for

economic damages in their respective amounts calculated by the expert economist.

B.     PLAINTIFFS NEGATIVELY AFFECTED BY STATE “PRESENCE”
       REQUIREMENTS.

       In its original Heiser opinion, this Court denied certain plaintiffs’ claims for intentional

infliction of emotional distress, because, under the relevant state law, those not “physically

present” to witness the harm done cannot recover. 3 These plaintiffs now rest their claims on the

2008 NDAA, which provides a federal cause of action. Therefore, this Court will now consider

their request for compensatory damages in light of traditional state-adopted principles of tort law

and the construction given them by federal judges in similar cases, rather than—as was the

practice under the old pass-through approach—simply the explicit requirements of the relevant

state law.

       In evaluating intentional infliction of emotional distress claims in these actions, federal

judges often turn to the Restatement (Second) of Torts as a “as a proxy for state common law.”

Bettis, 315 F.3d at 333, see also Sutherland v. Islamic Republic of Iran, 151 F. Supp. 2d 27, 48-

50 (D.D.C. 2001) (Lamberth, J.) (applying the Restatement to battery, assault, IIED, and other

tort claims). In the section “Outrageous Conduct Causing Severe Emotional Distress,” the

Restatement states that

              (1) One who by extreme and outrageous conduct intentionally or
       recklessly causes severe emotional distress to another is subject to liability for
       such emotional distress, and if bodily harm to the other results from it, for such
       bodily harm.

       3
           These plaintiffs are Che Colson, Laura Johnson, and Bruce Johnson.
                                                -8-
                (2) Where such conduct is directed at a third person, the actor is subject to
       liability if he intentionally or recklessly causes severe emotional distress

                        (a) to a member of such person's immediate family who is present
               at the time, whether or not such distress results in bodily harm, or

                       (b) to any other person who is present at the time, if such distress
               results in bodily harm.

RESTATEMENT (SECOND) OF TORTS § 46. In light of § 46(2), it appears that the general principles

of common law do not permit recovery when a plaintiff fails to prove that he or she was not

physically present at the time of the attack. Yet, the Restatement attaches a caveat: “The

Institute expresses no opinion as to whether there may not be other circumstances under which

the actor may be subject to liability for the intentional or reckless infliction of emotional

distress.” Id. This qualification suggests that, in the words of one leading text, “If the

defendants’ conduct is sufficiently outrageous and intended to inflict severe emotional harm

upon a person which is not present, no essential reason of logic or policy prevents liability.” Dan

B. Dobbs, The Law of Torts § 307, at 834 (2000).

       Terrorism, unique among the types of tortious activities in both its extreme methods and

aims, passes this test easily. As the Stethem court wrote, “All acts of terrorism are by their very

definition extreme and outrageous and intended to cause the highest degree of emotional distress,

literally, terror, in their targeted audience: The more extreme and outrageous, the greater the

resulting distress.” 201 F. Supp. 2d at 89. Indeed, as this Court put it, the “intent to create

maximum emotional impact,” particularly on third parties, is terrorism’s raison d'etre. Eisenfeld,

172 F. Supp. 2d at 9. Thus, in Sutherland, for example, the Court awarded compensatory

damages to the wife of a terrorist hostage victim, upholding her intentional infliction of

emotional distress claim on the grounds that the terrorists intended to—and did—cause her

                                                 -9-
emotional harm. 151 F. Supp. 2d at 50; see also Jenco v. Islamic Republic of Iran, 154 F. Supp.

2d 27, 36 (D.D.C. 2001) (Lamberth, J.) (another terrorist hostage case upholding a non-present

spouse’s claim of intentional infliction of emotional distress). Additionally, even in terrorism

exception suits not involving hostages, “Courts have uniformly held that a terrorist attack—by its

nature—is directed not only at the victims but also at the victims’ families.” Salazar v. Islamic

Republic of Iran, 370 F. Supp. 2d 105, 115 (D.D.C. 2005) (Bates, J.) (collecting cases). Indeed,

the Salazar court found that the “defendant’s campaign of attacks against Westerners was

intended not only to harm the victims, but to instill terror in their loved ones and others in the

United States.” Id.

        “Nonetheless,” the Court said in Jenco, “some lines must be drawn.” 154 F. Supp. 2d at

36. While it is true that terrorist acts of the sort at issue in this case aim to “instill terror” among

Westerners in general, no reasonable construction of the 2008 NDAA will turn the American

citizenry into a potential class of IIED plaintiffs. Judges must recognize the “clear bounds” of

the law. Bettis, 315 F.3d at 336. Thus, “[t]he Court draws the line with respect to family

relationship (and not presence).” Jenco, 154 F. Supp. 2d. at 36. “[T]o collect for intentional

infliction of emotional distress in cases such as this one, the plaintiff need not be present at the

place of outrageous conduct, but must be a member of the victim’s immediate family.” Id.

Furthermore, although Jenco and Sutherland appear to concern only those suits arising from

hostage takings, the Court, consistent with the above-quoted reasoning in Salazar, here extends

the suspension of the presence requirement to terrorism exception cases generally.

        The Court finds, therefore, that the “presence” requirement by itself no longer bars the

claims of the plaintiffs in this category. Accordingly, the Court will award compensatory

                                                 - 10 -
damages to two of these plaintiffs, 4 while it will postpone its final evaluation of the third

plaintiff’s claim until it resolves the “immediate family” test issue, which it takes up below. 5

C.     PLAINTIFFS NEGATIVELY AFFECTED BY THE “IMMEDIATE FAMILY”
       RULE.

       In its original Heiser opinion, this Court denied certain plaintiffs’ claims for intentional

infliction of emotional distress, because, under the relevant state law, those who are not

“immediate family”—in addition to those not “physically present”—cannot recover. 6 The

plaintiffs in this category now rest their claims on the 2008 NDAA, which provides a federal

cause of action. Therefore, this Court will now consider their request for compensatory damages

in light of traditional state-adopted principles of tort law and the construction given them by

federal judges in similar cases, rather than—as was the practice under the old pass-through

approach—simply the explicit requirements of the relevant state law.

       Again, to discern the governing (because well-established) principles of tort law in this

case, we turn first to the Restatement: “Where such conduct is directed at a third person, the

       4
          “‘Solatium’ is defined as compensation ‘for hurt feelings or grief.’ Surette v. Islamic
Republic of Iran, 231 F. Supp. 2d 260, 267 (D.D.C. 2002) (quoting BLACK’S LAW DICTIONARY
1397 (7th ed. 1999)). “In the context of FSIA cases . . . [it is] ‘indistinguishable’ from the claim
of intentional infliction of emotional distress.” Id. (quoting Wagner, 172 F. Supp. 2d at 135
n.11). Accordingly, in calculating damages for valid IIED claims, the Court, consistent with
prior cases, awards $5 million to parents (and sons or daughters, if the parent is the decedent)
and $2.5 million to siblings. See, e.g., Anderson v. Islamic Republic of Iran, 90 F. Supp. 2d 107,
113 (D.D.C. 2000); Eisenfeld, 172 F. Supp. 2d at 10-11; Flatow, 999 F. Supp. at 29-32.
       5
        For their IIED claims, Laura Johnson and Bruce Johnson had merely to overcome the
presence rule to show liability. They have done so. Consequently, they will be awarded
damages. The other plaintiff in this category, however, Che Colson, must still satisfy the
“immediate family” test in order to recover. That issue will be treated below.
       6
           These plaintiffs are James Wetmore, George Beekman, and Che Colson.

                                                - 11 -
actor is subject to liability if he intentionally or recklessly causes severe emotional distress to a

member of such person's immediate family who is present at the time, whether or not such

distress results in bodily harm. RESTATEMENT (SECOND) OF TORTS § 46. Though it has proved

willing in terrorism exception suits to interpret the presence requirement loosely given the

unconventional nature of the torts resulting from terrorist acts, this Court, in addition to the Court

of Appeals, has generally adopted the strict meaning of “immediate family,” defined as one’s

spouse, parents, siblings, and children. Jenco, 154 F. Supp. 2d at 38 n.8 (“This definition is

consistent with the traditional understanding of one’s immediate family.”) See Dobbs, supra,

§ 310 (addressing the scope of recovery in consortium claims).

        In Bettis, for example, the Court of Appeals found that, under the FISA, nieces and

nephews lacked standing to make IIED claims:

        Appellants claim that the “immediate family” requirement of § 46(2)(a) is
        satisfied in this case, because [t]he nieces and nephews were near relatives or
        close associates of Fr. Jenco. This, of course, is not the test enunciated in the
        Restatement. Rather, § 46(2)(a) is perfectly plain in its reference to “immediate
        family.” It does not refer to “family members,” “near relatives,” “close
        associates,” or persons with whom the victim has “close emotional ties”—rather,
        it says, plainly, “immediate family.” And there is no doubt whatsoever that, in
        this case, nieces and nephews are not “immediate family” members. Indeed,
        appellants do not dispute this point. Rather, they claim that § 46(2)(a) should be
        construed liberally to afford “situational justice.” As much as we sympathize
        with appellants’ claims, we have no authority to stretch the law beyond its clear
        bounds to satisfy our sense of justice.

315 F.3d at 335-36 (citations and quotations omitted). Pages later, however, after noting the

appellants’ failure to cite a single case in which a niece or nephew has been considered

“immediate family,” the Court took notice of several exceptions to the strict application of the

rule:

        In a few limited circumstances, some courts have allowed relatives who either
        resided in the same household with the victim or were legal guardians to recover

                                                - 12 -
       for negligent infliction of emotional distress. . . . In these cases, the parties in
       issue were members of the victim's household, and they were viewed as the
       functional equivalents of immediate family members. In this case, however,
       appellants merely claim that the nieces and nephews enjoyed a close relationship
       with Fr. Jenco, which is far short of what § 46(2)(a) requires.

Id. at 337 (citations omitted) (emphasis in original). Tellingly, the Bettis court then noted that

“[t]o define ‘immediate family’ to embrace nieces and nephews who do not live in the immediate

household or have any legal obligation to the victim would stretch the term too far.” Id.

       Here, the Court must “bear in mind the realities of tort law and the necessity of limiting

recovery to a definable scope of individuals.” Jenco, 154 F. Supp. 2d at 36-37. Yet, in

distinguishing the niece-and-nephew action from those involving “functional equivalents of

immediate family members,” the Court of Appeals subtly acknowledges that, in those rare cases

in which the parties at issue had lived in the victim’s immediate household and had been in other

important respects like a spouse, parent, sibling, or child to the victim, circumstances may

require a slight stretching of the immediate-family requirement—comparable to the way in

which the unconventional nature of terrorist activity sometimes demands a suspension of the

presence requirement.

       In light of the evidence, then, this Court finds that James Wetmore, the non-adoptive

stepfather of Brian McVeigh, and George Beekman, the non-adoptive stepfather of Joshua

Woody, had been the functional equivalents of fathers and thus satisfy the immediate-family test.

As the plaintiffs’ noted in their brief the record in this case establishes that Messrs. Wetmore and

Beekman both “lived in the same household” as their stepsons while the stepsons were still

minors and “treated” them as their own sons “in every sense (e.g., financially, emotionally,

socially).” See Dk. # 127 p.20. Additionally, in the case of Che Colson, the non-adopted

stepson of Kevin Johnson, given the facts that “Kevin treated Che like he was his biological

                                               - 13 -
stepfather,” that “Che and Kevin maintained their close relationships until the day Kevin died,”

and that “[after] Shryl and Kevin married, Kevin was financially responsible for Che,” Heiser,

499 F. Supp. 2d at 327, this Court finds that Che had been the functional equivalent of a son and

thus satisfies the immediate-family test. Accordingly, the Court will award him compensatory

damages in the amount requested in the motion. 7

D.     PUNITIVE DAMAGES.

       In its original Heiser decision, this Court denied plaintiffs’ request that punitive damages

be awarded against the state of Iran, MOIS and the IRGC. 466 F. Supp. 2d at 270. Under

§ 1605A, however, plaintiffs are now entitled to an award of punitive damages. When

determining punitive damage awards under the FSIA’s terrorism exception, it is the custom of

this Court to apply general principles of tort law. Flatow, 999 F. Supp. at 32. Among these is

the “need for deterrence.” Id. (citing RESTATEMENT (SECOND) OF TORTS § 908(1)-(2)). In

Flatow, Iran expert Dr. Patrick Clawson testified that a factor of three times Iran’s then-yearly

expenditure of approximately $75 million on terrorist activities “would be the minimum amount

in punitive damages that would affect the conduct of the Islamic Republic of Iran, and that a

factor of up to ten times its annual expenditure for terrorism must be considered to constitute a

serious deterrent to future terrorist activities aimed at United States nationals.” Id. at 34. The

Court then found that an award of three times the expenditure was appropriate—$225 million.

       Yet, on the matter of how this Court is to determine the proper amount in punitive

damages, this action differs from Flatow in several respects. First, in this case, Dr. Clawson has

       7
         See supra note 4 (listing typical damage award amounts for a family member’s pain and
suffering in terrorism cases).
                                              - 14 -
recommended an award of damages between three and five times Iran’s annual terrorism

expenditure, not three and ten. Second, rather than providing this Court with a single dollar

amount spent by Iran on terrorism, Dr. Clawson has been able merely to estimate that in 1996 the

sum fell between $50 million to $150 million. This range, according to Dr. Clawson, reflects not

only a degree of uncertainty regarding the precise dollar amount earmarked yearly for terrorists,

but more significantly, disagreement among experts over what activities constitute terrorism in

the first place. Though some of the money goes directly to terrorist operations, most of it

ultimately funds “arms” of the terrorist groups, such as hospitals and political organizations,

through which the terrorists are able to recruit. Third, relying on the expert opinion of Dr.

Clawson, Plaintiffs have argued that a punitive damage award in this action less than any amount

awarded in a prior case against Defendants would indicate to Iran “that the United States was

less concerned about Iranian terrorism.” See Dk. # 143 at p. 28. Fourth, though no prior FSIA

case against Iran has resulted in an award of punitive damages exceeding $400 million, 8

Plaintiffs here requested first an award of $500 million—only later to increase that amount in

their post-2008 NDAA motion to $650 million.

       With these facts before it, this Court finds an award of punitive damages in the amount of

$300 million to be appropriate. In Flatow, the award of punitive damages equaled Iran’s annual

expenditure on terrorism multiplied by three (the lowest multiplier Dr. Clawson recommended),

and, in numerous subsequent cases, such awards were calculated likewise. This Court sees no

reason to break from that tradition now. Regarding the award formula’s multiplicand, however,

prior decisions offer little guidance. Here, this Court is presented not with a single dollar

       8
         The highest award of punitive damages ordered against Iran ($400 million) issued from
Estate of Bayani v. Islamic Republic of Iran, 530 F. Supp. 2d 40 (D.D.C. 2007).

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amount, but with a range—and, by extension, the controversy the range reflects. In the interest

of remaining neutral in the debate on the complicated topic of terrorism financing, the Court

chooses to take the mean of the range’s two extremes ($50 million and $150 million) and

multiply it ($100 million) by three. The result, an award of $300 million, appears fitting also in

light of the foreign policy issue raised by Plaintiffs. Were the Court to award an amount less

than any of those declared in prior cases, the U.S., Plaintiffs have argued, would risk seeming to

Iran “less concerned about Iranian terrorism.” Yet, with one exception, this Court has never

awarded an amount higher than $300 million in punitive damages against Iran or its divisions

and instrumentalities. 9 To the extent that Iran is paying attention and is sensitive to the

judgments of this Court—and if Dr. Clawson is to be believed, it is—an award of $300 million in

this case seems likely to have a deterrent effect.

                                      II.     CONCLUSION.

       For the above reasons, the Court awards the plaintiffs a total of $36,658,063 in

compensatory damages and $300,000,000 in punitive damages. This Court is mindful of the

tremendous challenges that these and other plaintiffs face in their efforts to enforce Court

judgments entered in accordance with the FISA terrorism exception. It is therefore the earnest

hope of this Court that today’s judgment will offer these victims something more than a

symbolic victory in what has been their long and arduous struggle against state-sponsored

terrorism.

       A separate Order and Judgment consistent with this opinion shall issue this date.

       9
           See case cited supra note 8.
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         ROYCE C. LAMBERTH

         CHIEF JUDGE
         United States District Court
         Washington, D.C.

         September 30, 2009

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