Supreme Court to Review Terrorism-Related Judgments Against Iran--2nd Update
October 01 2015 - 1:06PM
Dow Jones News
By Brent Kendall And Jess Bravin
WASHINGTON--The Supreme Court on Thursday agreed to consider an
appeal by Iran's central bank seeking to prevent terrorism victims
from collecting nearly $2 billion in frozen Iranian banking
assets.
The appeal was one of 13 new cases the Supreme Court added to
its docket Thursday, its first such action since the justices
returned from a three-month summer break.
Among the other cases, the court stepped into a long-running
dispute between Reynolds American Inc. and the European Union. The
EU has accused subsidiaries of the tobacco giant of orchestrating
an international money-laundering operation to finance the sale of
cigarettes through what it says are "organized crime, sanctioned
regimes and terrorist groups."
In the Iran case, the court said it would consider an appeal by
Bank Markazi, which held an interest in the frozen funds. The bank
is challenging lower U.S. court rulings that allowed the money to
be turned over to more than 1,300 American victims or surviving
family members who won civil judgments holding Iran liable for
sponsoring terrorist attacks.
The attacks included the 1983 Marine barracks bombing in Beirut
and the 1996 Khobar Towers bombing in Saudi Arabia.
The Iranian bank argued in its petition to the Supreme Court
that Congress acted improperly by passing legislation in 2012
specifically allowing victims to seize the money. The bank argued
lawmakers violated the separation of powers by legislating the
outcome of a court case.
The victims urged the Supreme Court to reject the appeal, saying
high-court precedent made clear Congress could change the governing
law that is applicable to a pending case.
The court's decision to hear the case rejected the advice of
U.S. Solicitor General Donald Verrilli, who on behalf of the Obama
administration urged the court not to intervene.
Bank Markazi said the funds were part of its foreign-currency
reserves. The money was held in a Citibank account maintained by a
Luxembourg financial intermediary doing business with an Italian
bank that in turn did business with Iran's central bank. The funds
are being supervised by a court-appointed trustee.
In the Reynolds case, the justices will review an
appellate-court ruling allowing the EU to pursue claims against the
maker of Camel and Lucky Strike cigarettes under the Racketeer
Influenced and Corrupt Organizations Act. Reynolds argues that the
RICO Act cannot be applied outside the U.S., and therefore the EU
suit should be dismissed.
Reynolds cited a 2010 Supreme Court opinion holding investors
can't sue under the Securities Exchange Act of 1934 for alleged
misconduct on foreign exchanges.
"We are pleased the court granted review, and we look forward to
presenting our arguments," company spokesman Bryan Hatchell
said.
The Second U.S. Circuit Court of Appeals, in New York, ruled
that aspects of the racketeering law can be applied to foreign
activity affecting the U.S. In addition, the court said some of the
allegations, such as the use of a "Russian organized crime
syndicate" in Queens, N.Y., to launder money, occurred within the
U.S.
Other new cases include an Alaska moose hunter's challenge to
National Park Service regulatory control of state-owned lands; a
challenge to a judge's involvement in a Pennsylvania death penalty
case; and a case examining whether Puerto Rico has a sovereign
right to prosecute alleged criminal conduct that was also
prosecuted by the U.S. government.
The court, which opens its new term next week, will hear
arguments in the new cases this winter, with rulings expected by
July 2016.
The justices took no action on a Justice Department appeal of a
lower-court ruling that upended prosecutors' crackdown on Wall
Street insider trading. The court will issue more orders on pending
cases next Monday.
Write to Brent Kendall at brent.kendall@wsj.com and Jess Bravin
at jess.bravin@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 01, 2015 13:51 ET (17:51 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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