Jenny Rubin v. Islamic Republic of Iran
2016 U.S. App. LEXIS 13194
| 7th Cir. | 2016Background
- In 2003 U.S. victims of a 1997 Hamas suicide-bombing obtained a $71.5 million default judgment against Iran under the FSIA terrorism exception; efforts followed to execute the judgment on Iranian assets in the U.S.
- Plaintiffs sought to attach four Persian-artifact collections in Illinois (Persepolis, Chogha Mish, Oriental Institute, Herzfeld) held by University of Chicago and Field Museum.
- By appeal time, Chogha Mish had been returned to Iran; Herzfeld and Oriental Institute collections were not claimed by Iran. The only contested property on the merits was the Persepolis Collection, which Iran owns and the University possesses under a long-term academic loan.
- Plaintiffs asserted three statutory routes to execution: (1) FSIA §1610(a) (commercial-activity exception), (2) FSIA §1610(g) (enacted with §1605A in 2008), and (3) TRIA §201 (execution on blocked assets).
- The district court granted summary judgment for Iran and the museums, holding: §1610(a) inapplicable because the foreign state itself must have used the property commercially; §1610(g) is not an independent exception to execution immunity but only removes Bancec separateness restraints; and TRIA inapplicable because the Persepolis artifacts were not blocked assets.
- The Seventh Circuit affirmed: Persepolis not reachable under §1610(a), §1610(g) requires satisfaction of another §1610 exception, and TRIA unavailable because the artifacts are not blocked.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §1610(a) permits execution when a third party (the University) uses foreign-state property commercially | Rubin: third-party use (University’s academic study/possession) triggers §1610(a) | Iran/Univ: §1610(a) requires the foreign state itself to use the property commercially; third-party use irrelevant | Held: §1610(a) requires commercial use by the foreign state itself; no evidence Iran used the artifacts commercially, so §1610(a) does not apply |
| Whether §1610(g) is a freestanding exception permitting execution on any property of a state sponsor of terrorism (without satisfying other §1610 exceptions) | Rubin: §1610(g) creates an independent terrorism exception to execution immunity | Iran/Univ/US: §1610(g) abrogates Bancec separateness but does not abolish §1610’s substantive exceptions; plaintiffs still must satisfy §1610(a) or (b) | Held: §1610(g) removes the Bancec alter-ego/injustice hurdle but is not itself an independent exception; victims must proceed “as provided in this section” (i.e., satisfy other §1610 exceptions) |
| Whether TRIA §201 allows execution because the Persepolis Collection is a "blocked" asset | Rubin: artifacts are blocked (or re-blocked) and therefore reachable under TRIA | Iran/Univ: artifacts are not blocked—Persepolis was returned/held under a longstanding loan and not contested; Exec. Order 13599 exempts previously unblocked property | Held: the Persepolis artifacts are not blocked under the pertinent executive orders and TRIA does not apply |
| Territorial/ownership threshold: which collections are subject to attachment | Rubin: all four collections in U.S. museums should be reachable | Iran/Univ: Chogha Mish returned; Herzfeld and Oriental Institute not owned by Iran; only Persepolis both owned by Iran and in U.S. jurisdiction | Held: only the Persepolis Collection remained both Iranian-owned and within U.S. jurisdiction for merits review |
Key Cases Cited
- First Nat’l City Bank v. Banco Para El Comercio Exterior de Cuba, 462 U.S. 611 (Bancec) (presumption that state instrumentalities are separate; alter-ego/injustice exceptions)
- Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S. 480 (1975) (historical background on sovereign immunity and Executive Branch role)
- Republic of Argentina v. NML Capital, Ltd., 134 S. Ct. 2250 (2014) (limitations on extraterritorial execution authority)
- Republic of Argentina v. Weltover, Inc., 504 U.S. 607 (1992) (FSIA codified restrictive theory of sovereign immunity)
- Autotech Techs. LP v. Integral Research & Dev. Corp., 499 F.3d 737 (7th Cir. 2007) (execution immunity baseline and narrow exceptions)
- Rubin v. Islamic Republic of Iran, 637 F.3d 783 (7th Cir. 2011) (prior procedural rulings in same attachment litigation)
- Gates v. Syrian Arab Republic, 755 F.3d 568 (7th Cir. 2014) (interpreting §1610(g) in procedural lien-priority context)
- Bennett v. Islamic Republic of Iran, 825 F.3d 949 (9th Cir. 2016) (holding §1610(g) provides freestanding basis for execution; circuit conflict)