Court Opinion

ID: 9821715
Source: CourtListenerOpinion
Date Created: 2023-09-01 08:23:08.091728+00
Date Added: 2024-06-11T08:56:18.975152
License: Public Domain

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.
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. *1148§ 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, 756 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 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, 103 S.Ct. 2591, 77 L.Ed.2d 46 (1983); Flatow v. Islamic Republic of Iran, 308 F.3d 1065, 1071 n. 9 (9th Cir.2002) (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) subpara-graphs (A)-(E) explicitly prohibit consideration of each of the five Bancec factors.”); affd 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 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 property because Bank Melli’s property is not immune from attachment by virtue of § 1610(b)(3). Section 1610(b)(3) eliminates attachment immunity *1149if 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 Baneec 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. 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 § 1606A 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. 1141.] In doing so, the majority misinterprets the operation of § 1610(a) and (b) waivers in the context of § 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 § 1606A 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 *1150found in § • 1610(g) refers to the procedural aspects of § 1610, namely § 1610(f). Fan-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, tó 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, 122 S.Ct. 441, 151 L.Ed.2d 339 (2001) (quoting Duncan v. Walker, 533 U.S. 167, 174, 121 S.Ct. 2120, 150 L.Ed.2d 251 (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, 185 L.Ed.2d 242 (2013) (citing Microsoft Corp. v. i4i Ltd. P’ship, 564 U.S. 91, 131 S.Ct. 2238, 180 L.Ed.2d 131 (2011)).
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 instru-mentalities. 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 earned 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.
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 *1151easier 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 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).

. 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).”