Greenbaum v. Islamic Republic of Iran
| Citation | 588 F.Supp.3d 77 |
| Docket Number | Case No. 1:02-cv-2148-RCL, Case No. 1:06-cv-0745-RCL, Case No. 1:06-cv-0473-RCL, Case No. 1:03-cv-1708-RCL |
| Decision Date | 01 March 2022 |
| Parties | Steven M. GREENBAUM, et al., Plaintiffs, v. ISLAMIC REPUBLIC OF IRAN, et al., Defendants. Carlos Acosta, et al., Plaintiffs, v. Islamic Republic of Iran, et al., Defendants. Harry Beer, et al., Plaintiffs, v. Islamic Republic of Iran, et al., Defendants. Jason Kirschenbaum, et al., Plaintiffs, v. Islamic Republic of Iran, et al., Defendants. |
| Court | U.S. District Court — District of Columbia |
Barry L. Leibowitz, Leibowitz & Band, LLC, Wheaton, MD, David J. Cook, Pro Hac Vice, Cook Collection Attorneys, P.L.C., San Francisco, CA, James Bernard, Patrick N. Petrocelli, Stroock & Stroock & LaVan LLP, New York, NY, for Plaintiffs in 1:02-cv-2148-RCL.
Barry L. Leibowitz, Leibowitz & Band, & Kim LLC, Wheaton, MD, James Bernard, Patrick N. Petrocelli, Stroock & Stroock & LaVan LLP, New York, NY, for Plaintiffs Carlos Acosta in 1:06-cv-0745-RCL, Maria Acosta in 1:06-cv-0745-RCL, Tova Ettinger in 1:06-cv-0745-RCL, Baruch Kahane in 1:06-cv-0745-RCL, Norman Kahane in 1:06-cv-0745-RCL, Cipporah Kaplan in 1:06-cv-0745-RCL, Elizabeth Rich in 1:06-cv-0745-RCL.
Barry L. Leibowitz, Leibowitz & Band, & Kim LLC, Wheaton, MD, Ned I. Miltenberg, Washington, DC, James Bernard, Patrick N. Petrocelli, Stroock & Stroock & LaVan LLP, New York, NY, for Plaintiff Libby Kahane in 1:06-cv-0745-RCL.
Barry L. Leibowitz, Leibowitz & Band, LLC, Wheaton, MD, James Bernard, Patrick N. Petrocelli, Stroock & Stroock & LaVan LLP, New York, NY, Jonathan Paul Goldberg, Pro Hac Vice, Allen L. Rothenberg, Philadelphia, PA, for Plaintiffs Harry Beer in 1:06-cv-0473-RCL, Anna Beer in 1:06-cv-0473-RCL, Phyllis Maisel in 1:06-cv-0473-RCL, Estelle Carroll in 1:06-cv-0473-RCL, Jason Kirschenbaum in 1:03-cv-1708-RCL, Danielle Lynn Teitlebaum in 1:03-cv-1708-RCL, Joshua J. Kirschenbaum in 1:03-cv-1708-RCL, David Kirschenbaum in 1:03-cv-1708-RCL, Martin Kirschenbaum in 1:03-cv-1708-RCL, Isabelle Kirschenbaum in 1:03-cv-1708-RCL.
Barry L. Leibowitz, Leibowitz & Band, LLC, Wheaton, MD, Jonathan Paul Goldberg, Allen L. Rothenberg, Philadelphia, PA, for Plaintiff All Plaintiffs in 1:03-cv-1708-RCL.
Plaintiffs in this consolidated action hold default judgments against the Islamic Republic of Iran ("Iran") under the Foreign Sovereign Immunities Act ("FSIA") for injuries suffered in terrorist attacks.1 These judgments total nearly $100 million in compensatory damages and $900 million in punitive damages. Lest these judgments become "Pyrrhic [v]ictories," In re Islamic Republic of Iran Terrorism Litig. , 659 F. Supp. 2d 31, 55 (D.D.C. 2009), plaintiffs have diligently fought to enforce their judgments and receive their compensation. Millions of dollars remain unsatisfied to this day.
This case results from plaintiffs’ efforts to attach and execute on Iranian assets to satisfy their judgments. The prize here? Millions of dollars’ worth of light crude oil purportedly belonging to Iran. Plaintiffs sought writs of attachment and execution (the "Writs") against this cargo, which the Court originally granted. ECF Nos. 58 & 59. The United States then intervened and moved to quash the Writs. Mot. to Quash Writs, ECF No. 68. Plaintiffs responded, ECF No. 74, and the United States replied, ECF No. 75. Upon consideration of the parties’ filings and the applicable law in this case, the Court will GRANT the United States’ motion to quash the Writs. The United States holds the property at issue, and plaintiffs have not identified a waiver of federal sovereign immunity.
In November 2020, the owners of the M/T Achilleas, an oil tanker traveling off the coast of Oman, approached the United States about a suspicious shipment of light crude oil (the "Cargo") they had received. See Framework Agr., ECF No. 69-2 at 2. The M/T Achilleas's owners and the United States believed that the Cargo originally belonged to the Iranian Revolutionary Guard Corps ("IRGC") and its subsidiary, the Qods Force. See Aff. in Supp. of Seizure Warrant, ECF No. 69-1 at 6; Framework Agr., ECF No. 69-2 at 2. The United States soon applied for—and received—a seizure warrant for the Cargo. See ECF No. 69-1 at 2–3. At the same time, the United States requested—and received—a license from the Office of Foreign Assets Control ("OFAC") to engage in transactions necessary to transport and market the Cargo. See ECF Nos. 69-3 & 69-4.2 The M/T Achilleas's owners then acknowledged the United States’ rightful ownership of the Cargo and agreed to transport the Cargo to the United States. See ECF No. 69-2 at 3–4.
As the M/T Achilleas traveled to the coast of Texas, the parties in this litigation began a tenuous two-step. On February 3, 2021, the United States obtained an in rem arrest warrant for the Cargo. Arrest Warrant, United States v. All Petroleum-Product Cargo Aboard the Achilleas With International Maritime Org. No. 9398072 , No. 21-cv-305 (PLF) (D.D.C. Feb. 3, 2021), ECF No. 2. But plaintiffs soon caught wind of the M/T Achilleas and its bounty. On February 18, 2021, plaintiffs moved this Court for writs of attachment and execution against the Cargo. Pls.’ Mot. for Writs, ECF No. 58. The Court granted plaintiffs’ motion for the Writs that same day. Order, ECF No. 59. The parties agreed to delay serving the Writs until after the United States had sold the entirety of the Cargo. Decl. of Brian P. Hudak ¶ 9, ECF No. 69-6. The United States completed this interlocutory sale, and plaintiffs served the Writs, both on March 16, 2021. Id. ¶ 10. According to the United States, the proceeds of this sale (the "Proceeds") are held in an "interest-bearing account of the United States." ECF No. 68 at 12.
With the Court's permission, the United States intervened in this consolidated action to challenge the Writs. Order, ECF No. 65. The United States filed a motion to quash the Writs shortly thereafter. ECF No. 68. Plaintiffs responded, ECF No. 74, and the United States replied, ECF No. 75.3 This motion is ripe for review.
The Court will construe the United States’ motion as a motion for reconsideration under Rule 54(b). See ECF No. 68 at 14 n.5; accord Levin v. Islamic Republic of Iran , 523 F. Supp. 3d 14, 19 (D.D.C. 2021), appeal docketed , No. 21-7041 (D.C. Cir. Apr. 30, 2021). A court may reconsider its interlocutory orders "at any time before the entry of a judgment adjudicating all the claims and all the parties’ rights and liabilities." Fed. R. Civ. P. 54(b) ; see Cobell v. Jewell , 802 F.3d 12, 19 (D.C. Cir. 2015). Under this rule, a court may reconsider its prior orders "as justice requires," Capitol Sprinkler Inspection, Inc. v. Guest Servs. Inc. , 630 F.3d 217, 227 (D.C. Cir. 2011) (quoting Greene v. Union Mut. Life Ins. Co. of Am. , 764 F.2d 19, 22–23 (1st Cir. 1985)), which may include the existence of new arguments or information that "might reasonably be expected to alter the conclusion reached by the court." Cobell v. Norton , 355 F. Supp. 2d 531, 539–40 (D.D.C. 2005) (quoting Shrader v. CSX Transp., Inc. , 70 F.3d 255, 257 (2d Cir. 1995) ).
The Court granted plaintiffs’ writs of attachment and execution on an expedited basis, without the opportunity to apprise itself of the Government's views. See Order, ECF No. 59. Justice requires the Court to evaluate these newly available arguments and reassess the propriety of the Writs. This approach reflects that of other courts in this district, which "routinely evaluate the validity of writs of attachment de novo when faced with motions to quash." Levin , 523 F. Supp. 3d at 19–20 ; see, e.g. , Bennett v. Islamic Republic of Iran , 618 F.3d 19, 21 (D.C. Cir. 2010). The Court therefore reviews the Writs de novo.
Plaintiffs have undoubtedly suffered from Iran's support for the terrorist attacks that harmed them. But the United States carries a property interest in these assets seized on the high seas. Plaintiffs, therefore, bear the heavy burden of overcoming federal sovereign immunity, which they contend the United States has waived in § 201(a) of the Terrorism Risk Insurance Act ("TRIA"). The Court will begin—and end—with this "threshold jurisdictional question." Weinstein v. Islamic Republic of Iran , 274 F. Supp. 2d 53, 56 (D.D.C. 2003). Consistent with its prior opinions in Flatow v. Islamic Republic of Iran , 74 F. Supp. 2d 18 (D.D.C. 1999), and Weinstein , the Court holds that plaintiffs have not cleared this bar. The United States has demonstrated its ownership of the Cargo and Proceeds, thereby triggering federal sovereign immunity. And TRIA § 201(a) does not contain an unequivocal expression of waiver. Federal sovereign immunity precludes this Court's jurisdiction over the Cargo and Proceeds.
First, the Cargo and Proceeds are federal property. Under the applicable civil forfeiture statute, "[a]ll assets, foreign or domestic" of individuals engaged in federal crimes of terrorism are "subject to forfeiture to the United States." 18 U.S.C. § 981(a)(1)(G)(i). Forfeited property "shall be deemed to be in the custody of the Attorney General ... subject only to the orders and decrees of the court or the official having jurisdiction thereof." Id. § 981(c). And "[a]ll right, title, and interest" in forfeited property "shall vest in the United States upon commission of the act giving rise to forfeiture." Id. § 981(f). The United States arrested the Cargo under the authority of 18 U.S.C. § 981. See Arrest Warrant, All Petroleum-Product Cargo , No. 21-cv-305 (PLF) (Feb. 3, 2021), ECF No. 2. Throughout this arrest (and subsequent seizure), the United States carried a property interest in the Cargo. See 18 U.S.C. § 981(c), (f). And once the United States sold the Cargo, the resulting Proceeds were placed in an interest-bearing Treasury account. See ECF No. 68 at 12–13 (). So, the United States...
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