Court Opinion

ID: 9556823
Source: CourtListenerOpinion
Date Created: 2023-08-18 19:01:40.773456+00
Date Added: 2024-06-11T09:02:31.478849
License: Public Domain

UNITED STATES DISTRICT COURT
                              FOR THE DISTRICT OF COLUMBIA

 ESTATE OF CHRISTOPHER BROOK
 FISHBECK, et al.,

                        Plaintiffs,
                                                    Case No. 18-cv-2248 (CRC)
                        v.

 THE ISLAMIC REPUBLIC OF IRAN,
 et al.,

                        Defendants.

                             MEMORANDUM OPINION AND ORDER

       The over 1400 plaintiffs in this case bring claims under the terrorism exception to the

Foreign Sovereign Immunities Act (“FSIA”) against the Islamic Republic of Iran and various of

its constituent entities and instrumentalities for deaths and injuries suffered by U.S.

servicemembers in Iraq from 2003 to 2011. No defendants have appeared.

       The FSIA’s terrorism exception abrogates sovereign immunity for foreign states that,

among other things, provide “material support or resources” for extrajudicial killings. 28 U.S.C.

§ 1605A(a)(1); Mohammadi v. Islamic Republic of Iran, 782 F.3d 9, 14 (D.C. Cir. 2015). In a

prior order, the Court found that Defendants Islamic Republic of Iran (“Iran”), Islamic

Revolutionary Guard Corps (“IRGC”), and Iranian Ministry of Intelligence & Security (“MOIS”)

provided material support, as that term is used in 28 U.S.C. § 1605A(a)(1), to various Shia and

Sunni terrorist groups, that said material support was essential to the operational capacity of

those groups, and that attacks perpetrated by those groups in Iraq from 2003 to 2011 were the

reasonably foreseeable and natural consequence of those defendants’ material support. Order,

ECF No. 127 (March 27, 2023). The Court withheld judgment as to whether the same could be

said for Defendants Bank Markazi, Bank Melli, and the National Iranian Oil Company

(“NIOC”). Id. at 3. While the Court found “satisfactory evidence in the record that Bank
Markazi and Bank Melli provided financial services, and that NIOC provided funding, to the

Islamic Revolutionary Guard Corps and/or other Iranian entities, which in turn provided material

support to the subject terrorist groups,” the Court requested supplemental briefing from the

plaintiffs as to whether those indirect activities constituted “material support” under the statute.

Id. Upon further consideration following that briefing, the Court finds that Bank Markazi and

Bank Melli provided material support that foreseeably enhanced the capacity of the subject

groups. Based on the present record, however, plaintiffs have not adequately shown that NIOC

provided material support during the relevant time period. The Court therefore finds that it lacks

subject-matter jurisdiction over NIOC under the FSIA’s terrorism exception.

       I.      Legal Standard

       The FSIA defines “material support or resources” broadly as “any property, tangible or

intangible, or service, including currency or monetary instruments or financial securities,

financial services, [and] lodging[.]” Stansell v. Republic of Cuba, 217 F. Supp. 3d 320, 339

(D.D.C. 2016) (citing 28 U.S.C. § 1605A(h)(3) and 18 U.S.C. § 2339A). Plaintiffs need not

show that the defendants “specifically knew of or intended [their] support to cause” the particular

attacks at issue. Owens v. Republic of Sudan, 864 F.3d 751, 798–99 (D.C. Cir. 2017) (“Owens

IV”), vacated and remanded on other grounds sub nom. Opati v. Republic of Sudan, 140 S. Ct.

1601 (2020). Because “material support ‘is fungible’ and ‘terrorist organizations can hardly be

counted on to keep careful bookkeeping records,’” plaintiffs are only required to show that the

material support was a proximate cause of their injuries. Id. at 799 (quoting Kilburn v. Socialist

People's Libyan Arab Jamahiriya, 376 F.3d 1123, 1130 (D.C. Cir. 2004)). For material support

to be a proximate cause of an act of terrorism, plaintiffs must show that the aid was a “substantial

factor” in the events leading to the attack and that the injury was “reasonably foreseeable or

anticipated as a natural consequence” of the defendant’s actions. Id. at 794 (quotations omitted);

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see Force v. Islamic Republic of Iran, 464 F. Supp. 3d 323, 368 (D.D.C. 2020) (holding that

“Iran’s financial and military aid” were substantial factors in the alleged attacks because the aid

“was essential to each group’s operating capacity and that, without Iran’s backing, both groups

would be substantially weakened.”). The evidentiary standard for these inquiries is “evidence

satisfactory to the court.” 28 U.S.C. § 1608(e).

       II.     Analysis

               A.      Bank Melli and Bank Markazi

       Relying on several expert reports and official findings and statements by the United

States Department of Treasury, plaintiffs present evidence that Bank Melli and Bank Markazi

provided funding and financial services to the IRGC and other entities within Iran’s terrorist

network during the relevant period from 2003 to 2011. See, e.g., PX. 36, U.S. Dep’t of the

Treasury Fact Sheet at 3 (Oct. 25, 2007) (“From 2002 to 2006, Bank Melli was used to send at

least $100 million to the [IRGC’s] Qods Force. When handling financial transactions on behalf

of the IRGC, Bank Melli has employed deceptive banking practices to obscure its

involvement[.]”); PX. 51, U.S. Dep’t of the Treasury Press Release at 3 (Nov. 5, 2018) (“Since

the mid-2000s, Bank Melli increasingly provided services to Iranian military-related entities as

they became further involved in all aspects of the Iranian economy. Bank Melli has enabled the

IRGC and its affiliates to move funds inside and outside of Iran.”); PX. 303, U.S. Dep’t of

Treasury Statement at 3 (July 12, 2007) (presentation by Under Secretary of the Treasury for

Terrorism explaining that Iran “use[s] its banks to pursue not only its proliferation ambitions but

also its funding of terrorism” and that Bank Markazi attempts to persuade other financial

institutions to hide its involvement in transactions to evade international monitoring); PX. 122,

U.S. Dep’t of the Treasury Fact Sheet at 2–3 (describing how Bank Markazi has engaged in

“deceptive practices” and provided “substantive assistance to minimize the impact of sanctions”

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on other Iranian banks); PX. 1 (Clawson Decl.) ¶ 23 (“Iran has used Markazi for many years,

including 2003-2011, to transfer funds to support terrorism.”); U.S. Dep’t of Treasury Statement

at 3 (April 17, 2008) (testimony by Deputy Assistant Secretary for Terrorist Financing before the

House Subcommittee on Terrorism, Nonproliferation and Trade explaining how Bank Markazi

uses deceptive financial practices to “facilitate transactions for sanctioned Iranian banks”),

https://perma.cc/2CNA-35CU. At least one other court in this District, reviewing much of the

same evidence before this Court, also found that Bank Markazi and Bank Melli contributed

material support to Iran’s terrorist network in Iraq during the same timeframe. See Hake v. Bank

Markazi Jomhouri Islami Iran, No. 17-cv-114 (TJK), 2022 WL 4130837, at *10 (D.D.C. Sept.

12, 2022) (finding Bank Markazi and Bank Melli provided material support to Shia terrorist cells

that conducted attacks in Iraq from 2004 through 2011); see also Henkin v. Islamic Republic of

Iran, 18-cv-1273, ECF No. 29, at 39–43, 46–48 (D.D.C. July 12, 2021) (finding that Bank

Markazi and Bank Melli provided material support to Iran’s terrorist activities, resulting in a

2015 terrorist attack carried out by Hamas in the West Bank).

       That Bank Melli and Bank Markazi provided financial services and resources to the

IRGC and other entities in Iran’s terrorist network, which in turn trained and armed the terrorist

groups alleged to have committed the bellwether attacks, does not lessen their culpability under

the FSIA. As noted by the D.C. Circuit, “the terrorism exception to the FSIA targets sovereign

nations in an effort to deter them from engaging, either directly or indirectly, in terrorist acts.”

Owens IV, 864 F.3d at 776 (emphasis added). To hold otherwise would allow bad actors to

escape liability so long as they were not the final link in the causal chain of support for terrorism.

Like others in this District, this Court holds that indirect provision of material support via an

intermediary entity can trigger the terrorism exception to the FSIA. See, e.g., Hake at *11

(D.D.C. Sept. 12, 2022) (holding Bank Melli, Bank Markazi, and NIOC provided material

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support under the FSIA because they funded and provided financial services for Iranian

intermediary organizations that were used to bolster terrorist groups); Flanagan v. Islamic

Republic of Iran, 87 F. Supp. 3d 93, 106 (D.D.C. 2015) (finding Iran and its instrumentalities,

IRGC and MOIS, provide material support by directly training Al-Qaeda operatives and

providing support to Hezbollah, which in turn trained Al-Qaeda operatives); Henkin at 39–43,

46–48 (D.D.C. July 12, 2021) (finding that Bank Markazi and Bank Melli provided material

support to Hamas via financing that passed through the IRGC and other banks).

       The Court emphasizes the importance of the foreseeability requirement for establishing

indirect chains of material support for terrorism. Evidence before the Court shows that Bank

Melli provided material support to the IRGC, including the IRGC’s Qods Force, which

functioned as “the main Iranian organization supporting and directing those in Iraq attacking

Americans.” PX. 3 (Piatetsky Decl.) ¶ 28. The IRGC, in turn, has been designated a

“Specifically Designated Global Terrorist” and a “Foreign Terrorist Organization” due to its

longstanding support of terrorism. See, e.g., PX. 21, U.S. Dep’t of State, Designation of the

IRGC at 1 (Apr. 8, 2019) (“[T]he IRGC, part of Iran’s official military, has engaged in terrorist

activity or terrorism since its inception[.]”). And by October 2007, the United States had found

the IRGC’s Qods Force to be a supporter of terrorism. See PX. 135, Dep’t of Treasury Press

Release at 1 (May 10, 2018); U.S. Dep’t of State Fact Sheet (Oct. 25 2007) (“[Today], [t]he

Treasury Department also designated the [Qods Force] under E.O. 13224 for providing material

support to the Taliban and other terrorist organizations[.]”), https://perma.cc/L7TY-3N9V. Bank

Melli’s deliberate support to these known perpetrators and orchestrators of violence distinguishes

this case from a bank’s provision of routine financial services to groups that, unbeknownst to the

bank, engage in terrorist activities. Similarly, Bank Markazi and Bank Melli’s use of deceptive

banking practices to intentionally avoid international sanctions further demonstrates that their

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financial support for Iran’s terrorist network was distinct from customary banking activities.

Based on plaintiffs’ evidence (and the lack of any counter evidence from defendants), the Court

finds it credible that Bank Markazi and Bank Melli were aware that the resources and financial

services they provided to the IRGC’s Qods Force and other entities would foreseeably be used to

expand Iran’s terrorism network. The Court further finds that Bank Markazi and Bank Melli’s

support, including the provision of funding and assistance in evading international sanctions, was

a substantial factor in helping to grow Iran’s terrorist network in Iraq during the relevant period.

See, e.g., Clawson Decl. ¶¶ 122, 155–57, 216; Piatetsky Decl. ¶¶ 89, 99; PX. 6 (Rubin Decl.)

¶¶ 60, 72.

               B.      National Iranian Oil Company

       The Court cannot reach the same conclusion as to the National Iranian Oil Company

(“NIOC”) based on the current record. While plaintiffs and their experts have presented

evidence that NIOC provided funding to the IRGC, the present record does not show that NIOC

did so during the relevant period or that the purported funding facilitated the alleged attacks in

any way. To start, scant record evidence suggests that NIOC was funding terrorism generally

during the relevant period of 2003 to 2011 or that it provided aid that contributed to the

operational capacity of the relevant terrorist groups here. Nearly all of plaintiffs’ evidence

regarding NIOC is from well before the relevant period or shows support after the attacks had

already occurred. See, e.g., Piatetsky Decl. ¶ 63 (“In 1995, Under Secretary of State Peter

Tarnoff testified before the Senate that ‘a straight-line links Iran’s oil income and its ability to

sponsor terrorism, build weapons of mass destruction, and acquire sophisticated armaments.’”);

PX. 125, U.S. Dep’t of Treasury Press Release (Sept. 24, 2012) (Department of Treasury

determined that NIOC was an “agent or affiliate” of the IRGC based on then-recent efforts by the

IRGC to sell NIOC’s oil to circumvent sanctions); Mot. Material Support at 126, ECF No. 84

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(“[I]n November 2012, NIOC was placed on the Office of Foreign Assets Control (‘OFAC’) List

of Specially Designated Nationals and Blocked Persons (‘OFAC SDN List’) under Executive

Order No. 13382 for NIOC’s role in assisting the IRGC with the proliferation of weapons of

mass destruction.”). Missing, however, is credible evidence showing that NIOC’s provision of

funding to the IRGC could have been a substantial factor in supporting the attacks against

American soldiers from 2003 to 2011.

       Besides funding, Plaintiffs also theorize that NIOC provided direct support to the IRGC

during the relevant period via the use of its helicopters and personnel. See Clawson Decl. ¶ 163

(relaying the anecdote from a colleague that NIOC helicopters had been seen in the area of IRGC

arms smuggling routes). But plaintiffs’ isolated and unsubstantiated anecdote is not sufficient to

support that assertion. Even the expert who conveyed the anecdote admits that “such direct

NIOC support for terrorism is more the exception than the rule.” Id. ¶ 164. Accordingly, the

Court is not satisfied on the current record that NIOC provided material support that was a

substantial factor in growing Iran’s terrorism network during the relevant period. Plaintiffs may

supplement their evidence should they still seek to establish jurisdiction over NIOC.

       III.    Conclusion

       Accordingly, it is hereby

       ORDERED that plaintiffs’ [84] Motion Regarding Material Support is GRANTED in

part and DENIED in part as to Defendants Bank Markazi, Bank Melli, and NIOC. The Court

finds that Defendants Bank Markazi and Bank Melli have provided material support, as that term

is used in 28 U.S.C. § 1605A(a)(1), to Iran’s terrorist network during the relevant time period of

2003-2011. Further, the Court finds that said material support was a substantial factor in

growing the operating capacity of Iran’s terrorist network, and terrorist attacks involving Iran’s

network in Iraq during the relevant time period of 2003-2011 were reasonably foreseeable and a

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natural consequence of that material support. The Court cannot reach the same conclusions for

Defendant NIOC on the current record.

       SO ORDERED.

                                                          CHRISTOPHER R. COOPER
                                                          United States District Judge

Date: August 18, 2023

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