It Belongs in a Museum: Sovereign Immunity Shields Iranian Antiquities Even When It Does Not Protect Iran

It Belongs in a Museum: Sovereign Immunity Shields Iranian Antiquities Even When It Does Not Protect Iran

Legal Sidebari

It Belongs in a Museum: Sovereign Immunity
Shields Iranian Antiquities Even When It
Does Not Protect Iran
Updated March 22, 2018
Foreign sovereign immunity may protect property owned by nations designated as state sponsors of
terrorism, even when it does not shield the nations themselves, the Supreme Court held in Rubin v.
Islamic Republic of Iran. In an 8-0 opinion delivered by Justice Sotomayor (with Justice Kagan recused),
the Court ruled that the Foreign Sovereign Immunities Act (FSIA) did not permit U.S. victims of Iran-
sponsored terrorist attacks to seize a collection of Persian antiquities on loan from Iran to a museum at the
University of Chicago. Rubin underscores a common side effect of the FSIA’s terrorism-related
exceptions to sovereign immunity: although victims of terror attacks may be able to obtain judgments
against state sponsors of terrorism—currently, Iran, Sudan, Syria, and North Korea—they often have little
chance of seizing covered states’ property when seeking to collect their financial awards.
Background on Rubin
Rubin arose from a 1997 triple suicide bombing on a crowded pedestrian mall in Jerusalem. Hamas
claimed responsibility for the attacks, which killed five bystanders and injured nearly 200 others. Among
those wounded were eight U.S. citizens who, along with a group of close relatives, filed suit alleging that
Iran should be held liable for the attacks because it provided material support and training to Hamas.
When Iran did not appear to defend itself in the case, the district court entered a $71.5 million default
judgment in favor of the plaintiffs.
Iran did not pay the judgment, leaving the plaintiffs to identify Iranian assets in the United States that
were available for collection. Because various statutes and executive orders have restricted the transfer of
much of Iran’s property in the United States, the plaintiffs looked for nontraditional ways of collection.
They eventually sought to attach a set of approximately 30,000 clay tablets and fragments known as the
Persepolis Collection housed at the Oriental Institute in the University of Chicago. Discovered by
archeologists during an excavation of the ancient city of Persepolis in the 1930s, Iran loaned the 2,500-
year-old tablets to the University of Chicago in 1936 for research and translation. Iran still claims
ownership of the collection, and when the plaintiffs sought a court order allowing seizure of the tablets,
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Iran and the University of Chicago asserted that the foreign sovereign immunity embodied in the FSIA
protected the artifacts.
The Law of Foreign Sovereign Immunity
Originally enacted in 1976, the FSIA contains two presumptive rules of immunity: (1) foreign nations and
their “agencies and instrumentalities” are immune from suit in the United States (called jurisdictional
immunity), and (2) property owned by foreign sovereigns is immune from attachment. Both types of
immunity, however, are subject to exceptions. For example, in the Antiterrorism and Effective Death
Penalty Act of 1996 (AEDPA), Congress amended the FSIA to eliminate jurisdictional immunity for
certain claims against designated state sponsors of terrorism through a provision now titled the “Terrorism
exception to the jurisdictional immunity of a foreign state.” When a judgment is entered under that
exception, AEDPA also created an exception to the immunity from attachment afforded to property that is
owned by the state sponsor of terrorism and used for commercial activity in the United States.
This framework was further modified by the 2008 National Defense Authorization Act (2008 NDAA).
There, Congress addressed the circumstances by which property owned by the agencies or
instrumentalities of a foreign state sponsor of terrorism, such as state-owned corporation or financial
institution, could be used to satisfy a judgment against the state itself. In 1983, the Supreme Court held
that a plaintiff with judgment against a foreign state cannot attach property owned by the state’s agencies
and instrumentalities without overcoming the presumption of separateness between the state and those
entities. Lower courts eventually developed a list of five factors—known as the Bancec factors—that can
be used to overcome the presumption of separateness by showing, for example, that the state exercised
economic control over the property or received profits derived from it. In a provision codified at 28
U.S.C. § 1610(g), the 2008 NDAA limited the requirement for proof of the five Bancec factors in the
context of cases arising from state-sponsored terror attacks. More specifically, § 1610(g) provides that,
when a judgment is entered under the terrorism exception to jurisdictional immunity, property owned by
the state or its agencies and instrumentalities “is subject to attachment . . . regardless of” the application
of the listed Bancec factors.
The Circuit Split over Immunity from Attachment and State Sponsors of Terrorism
Rubin addressed a circuit split regarding the scope of § 1610(g). As detailed in this earlier Sidebar, two
U.S. courts of appeals had adopted a broad reading of the provision, interpreting it as containing a
freestanding exception to immunity from attachment. Under this approach, any time a judgment is entered
against a foreign state under the FSIA’s terrorism exception to jurisdictional immunity, property owned
by the state or its agencies and instrumentalities is not protected by immunity from attachment.
In the lower court proceedings in Rubin, however, the U.S. Court of Appeals for the Seventh Circuit
(Seventh Circuit) adopted a narrower view. It held that, although 28 U.S.C. §1610(g) allowed plaintiffs
with judgments against state sponsors of terrorism to attach property owned by the states’ agencies and
instrumentalities notwithstanding the applicability of the Bancec factors, the provision did not create a
stand-alone exception to immunity from attachment in cases against state sponsors of terrorism. Thus,
even though a judgment had been entered against Iran under the terrorism exception to jurisdictional
immunity, the Seventh Circuit held that the FSIA’s immunity from attachment still protected Iran-owned
property unless a separate exception to immunity applied. Based on this interpretation, the Seventh
Circuit denied the Rubin plaintiffs’ request to attach the tablets in the Persepolis Collection.
The Supreme Court Affirms the Narrow Reading of the Exception to Immunity from Attachment
The plaintiffs in Rubin urged the Supreme Court to adopt a broader reading of § 1610(g), arguing that the
provision was “designed to remove all impediments to terrorism victims’ civil lawsuits against designated
state sponsors of terrorism.” But the Supreme Court disagreed and sided with the Seventh Circuit. The
“most natural reading” of § 1610(g), the Court held, is that it was intended to limit the requirement for

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proof of the Bancec factors in the terrorism context, not to create a “blanket abrogation” of immunity
from attachment. Individuals with judgments against state sponsors of terrorism can still collect on their
judgments, Justice Sotomayor explained in her opinion for the unanimous Court. But those victims must
rely on the FSIA’s other exceptions to immunity from attachment (e.g., the listed exceptions in 28 U.S.C.
§ 1610(a)) or identify specific property or sources of funds that Congress has made available under other
federal laws, such as the Terrorism Risk Insurance Act or the Justice for United States Victims of State
Sponsored Terrorism Act (discussed in this CRS In Focus).
Congressional Interest in Rubin
Congress has had a longstanding interest in addressing the extent to which victims of terrorist attacks
overseas can obtain relief through civil suits in U.S. courts. Since the 1990s, Congress has enacted several
laws that limit sovereign immunity for state sponsors of terrorism and provide a cause of action to certain
victims of terror attacks. While federal courts have awarded these victims billions of dollars in judgments
under these laws, the judgment-holders often are unable to collect on their awards when the foreign state
does not have assets in the United States. Some judgment-holders have been creative in their efforts to
identify assets, seeking to attach less obvious forms of property like contract rights, internet domain
names, or the clay tablets in Rubin. But the Rubin decision serves as an illustration that, even when
judgment-holders are to identify property in the United States, the FSIA’s rules on immunity from
attachment still may prevent collection.
As recently as the Justice Against Sponsors of Terrorism Act (JASTA), which was passed over President
Obama’s veto in 2016 (discussed here), Congress has enacted legislation that reduces FSIA’s
jurisdictional immunity in the terrorism context without creating parallel exceptions to immunity from
attachment. Some argue that laws that eliminate jurisdictional immunity alone can be counterproductive
because they can create foreign relations repercussions, while raising too many hurdles for victims of
terrorism to receive tangible benefits. But others assert these laws can provide independent benefits, such
as deterring financing of terrorism.

Author Information

Stephen P. Mulligan

Legislative Attorney

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