Rubin v. Islamic Republic of Iran, 022118 FEDSC, 16-534

Docket Nº:16-534
Opinion Judge:SOTOMAYOR JUSTICE.
Party Name:JENNY RUBIN, ET AL., PETITIONERS v. ISLAMIC REPUBLIC OF IRAN, ET AL.
Judge Panel:SOTOMAYOR, J., delivered the opinion of the Court, in which all other Members joined, except KAGAN, J., who took no part in the consideration or decision of the case. JUSTICE KAGAN
Case Date:February 21, 2018
Court:United States Supreme Court
 
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583 U.S. ___ (2018)

JENNY RUBIN, ET AL., PETITIONERS

v.

ISLAMIC REPUBLIC OF IRAN, ET AL.

No. 16-534

United States Supreme Court

February 21, 2018

          Argued December 4, 2017

         ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT The Foreign Sovereign Immunities Act of 1976 (FSIA) grants foreign states and their agencies and instrumentalities immunity from suit in the United States and grants their property immunity from attachment and execution in satisfaction of judgments against them, see 28 U.S.C. §§1604, 1609, but with some exceptions. Petitioners hold a judgment against respondent Islamic Republic of Iran pursuant to an exception that applies to foreign states designated as state sponsors of terrorism with respect to claims arising out of acts of terrorism. See §1605A. To enforce that judgment, petitioners filed an action in the District Court to attach and execute against certain Iranian assets-a collection of ancient clay tablets and fragments housed at respondent University of Chicago. The District Court concluded that §1610(g)-which provides that certain property will be "subject to attachment in aid of execution, and execution, upon [a §1605A] judgment as provided in this section"-does not deprive the collection of the immunity typically afforded the property of a foreign sovereign. The Seventh Circuit affirmed.

         Held: Section 1610(g) does not provide a freestanding basis for parties holding a judgment under §1605A to attach and execute against the property of a foreign state; rather, for §1610(g) to apply, the immunity of the property at issue must be rescinded under a separate provision within §1610. Pp. 4-15. (a) Congress enacted the FSIA in an effort to codify the careful balance between respecting the immunity historically afforded to foreign sovereigns and holding them accountable, in certain circumstances, for their actions. As a default, foreign states have immunity "from the jurisdiction of the courts of the United States and of the States, " §1604, but there are express exceptions, including the one at issue here, for state sponsors of terrorism, see §1605A(a). The FSIA similarly provides as a default that "the property in the United States of a foreign state shall be immune from attachment arrest and execution." §1609. But §1610 outlines certain exceptions to this immunity. For example, §1610(a)(7) provides that property in the United States of a foreign state that is used for a commercial activity in the United States shall not be immune from attachment and execution where the plaintiff holds a §1605A judgment against the foreign state. Before 2008, the FSIA did not expressly address under which circumstances a foreign state's agencies or instrumentalities could be held liable for judgments against the state. The Court had addressed that question in First Nat. City Bank v. Banco Para el Comercio Exterior de Cuba, 462 U.S. 611, 628 (Bancec), and held that, as a default, agencies and instrumentalities of a foreign state are separate legal entities that cannot be held liable. It recognized the availability of exceptions, however, and left the lower courts to determine whether an exception applied on a case-by-case basis. The lower courts coalesced around five relevant factors (the Bancec factors) to assist in those determinations. In 2008, Congress amended the FSIA, adding §1610(g). Subparagraphs (A) through (E) incorporate almost verbatim the Bancec factors, leaving no dispute that, at a minimum, §1610(g) serves to abrogate Bancec where a §1605A judgment holder seeks to satisfy a judgment held against the foreign state. The question here is whether, in addition to abrogating Bancec, it provides a freestanding exception to property immunity in the context of a §1605A judgment. Pp. 4-8.

(b) The most natural reading of §1610(g)(1)'s phrase "as provided in this section" is that it refers to §1610 as a whole, so that §1610(g)(1) will apply to property that is exempted from the grant of immunity as provided elsewhere in §1610. Those §1610 provisions that do unambiguously revoke the immunity of a foreign state's property employ phrases such as "shall not be immune, " see §1610(a)(7), and "[n]otwithstanding any other provision of law, " see §1610(f)(1)(A). Such textual markers are conspicuously absent from §1610(g). Thus, its phrase "as provided in this section" is best read to signal only that a judgment holder seeking to take advantage of §1610(g)(1) must identify a basis under one of §1610's express immunity-abrogating provisions to attach and execute against a relevant property. This reading provides relief to judgment holders who previously would not have been able to attach and execute against property of an agency or instrumentality of a foreign state in light of Bancec. It is also consistent with the basic interpretive canon to construe a statute so as to give effect to all of its provisions, see Corley v. United States, 556 U.S. 303, 314, and with the historical practice of rescinding attach- ment and execution immunity primarily in the context of a foreign state's commercial acts, see Verlinden B. V. v. Central Bank of Nigeria, 461 U.S. 480, 487-488. Pp. 8-11.

(c) Petitioners' counterarguments are unpersuasive. They assert that the phrase "as provided in this section" might refer to the procedures in §1610(f)(1), which permits §1605A judgment holders to attach and execute against property associated with certain prohibited financial transactions, but which was waived by the President before it could take effect. However, it is not logical to read the phrase as indicating a congressional intent to create §1610(g) as an alternative to §1610(f)(1), particularly since Congress knows how to make clear when it is rescinding immunity. Nor could Congress have intended "as provided in this section" to refer only to §1610(f)(2)'s instruction that the Federal Government assist in identifying assets, since that provision does not provide for attachment or execution at all. Finally, there is no basis to conclude that "this section" in §1610(g) reflects a mere drafting error.

The words "property of a foreign state, " which appear in the first substantive clause of §1610(g), are not rendered superfluous under the Court's reading. Section 1610(g) serves to identify in one place all the categories of property that will be available to §1605A judgment holders for attachment and execution, and commands that the availability of such property will not be limited by the Bancec factors. Also, without the opening clause, §1610(g) would abrogate the Bancec presumption of separateness in all cases, not just those involving terrorism judgments under §1605A. Although petitioners contend that any uncertainty in §1610(g) should be resolved by giving full effect to the legislative purpose behind its enactment-removing obstacles to enforcing terrorism judgments-they offer no real support for their position that §1610(g) was intended to divest all property of a foreign state or its agencies or instrumentalities of immunity. Bank Markazi v. Peterson, 578 U.S. ___, ___, n. 2, distinguished. Pp. 12-15.

830 F.3d 470, affirmed.

          SOTOMAYOR, J., delivered the opinion of the Court, in which all other Members joined, except KAGAN, J., who took no part in the consideration or decision of the case.

          OPINION

          SOTOMAYOR JUSTICE.

         The Foreign Sovereign Immunities Act of 1976 (FSIA) grants foreign states and their agencies and instrumentalities immunity from suit in the United States (called jurisdictional immunity) and grants their property immunity from attachment and execution in satisfaction of judgments against them. See 28 U.S.C. §§1604, 1609. But those grants of immunity are subject to exception.

         Petitioners hold a judgment against respondent Islamic Republic of Iran pursuant to one such exception to jurisdictional immunity, which applies where the foreign state is designated as a state sponsor of terrorism and the claims arise out of acts of terrorism. See §1605A. The issue presented in this case is whether certain property of Iran, specifically, a collection of antiquities owned by Iran but in the possession of respondent University of Chicago, is subject to attachment and execution by petitioners in satisfaction of that judgment. Petitioners contend that the property is stripped of its immunity by another provision of the FSIA, §1610(g), which they maintain provides a blanket exception to the immunity typically afforded to the property of a foreign state where the party seeking to attach and execute holds a §1605A judgment.

         We disagree....

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