By Haggai Carmon

After 9/11, some of the insurance companies and families of the victims sued members of the Saudi royal family for financially supporting Al Qaeda. They have accused the Saudis of funding Osama bin Laden and other terrorist leaders directly or by donating money to so-called charitable organizations they knew to be financing Al Qaeda.

The Justice Department filed a “friend of the court” brief before the Supreme Court, suggesting the court dismiss the case and uphold the district court ruling that sided with the Saudis, citing the U.S. Foreign Sovereign Immunity Act (FSIA). According to the lower court, the Saudi royal family cannot be sued in an American court for their official acts.

Even though the 1996 exception to FSIA states that countries that sponsor terrorism lose their rights to immunity from American civil suits, Saudi Arabia was not on the State Department’s terror list. Although the plaintiffs could name Saudi Arabian royal family members in a civil lawsuit seeking damages which resulted from their sponsorship of terrorism, the U.S. government has not singled Saudi Arabia as a terror-sponsoring nation, and therefore, they do not fall within the exception to FSIA which removes immunity.

In the Justice Department’s brief, Solicitor General Elena Kagan agreed with the ruling of the U.S. Court of Appeals for the Second Circuit regarding the defendants’ immunity. She said that historically, the judiciary has looked to the executive in such matters, as subjecting a foreign state to civil suit can seriously affect international relations.

by Haggai Carmon

In 1997, a Hamas terrorist bombing hit a shopping promenade in Jerusalem, and Americans were among the victims. Three years later, several of the American victims of the bombing filed suit in the United States against Iran. They sought to recover damages from the country that had allegedly provided material support to Hamas and trained one of the bomb makers involved in the attack.

Typically, sovereign immunity laws protect countries from civil suits, resulting in governmental acts, brought against them by individuals of other countries. However, in 1996, an exception to that rule was made to the U.S. Foreign Sovereign Immunities Act of 1976 (FSIA), by which a country designated as a “state sponsor of terrorism” effectively forfeits its immunity when the lawsuit aims to recover damages for an “act of torture, extrajudicial killing, aircraft sabotage, hostage taking, or the provision of material support or resources …for such an act.”

In the case of Rubin et al v. the Islamic Republic of Iran, filed in 2000 in the U.S., Iran chose to boycott the proceedings, and the court ruled in favor of the plaintiffs; the U.S. District Court in Illinois awarded them a total of over $400 million, payable by Iran.

But when the plaintiffs sought to have the judgment executed –– they came up short. The Terrorism Risk Insurance Act of 2002 (TRIA) allows plaintiffs to satisfy judgments against terrorist agencies or states by seizing frozen assets. In 1979, the U.S. government froze Iranian assets, but – as the Rubin plaintiffs discovered – not all of these assets are still blocked (as per the Algiers Accords signed in 1981 by Iran and the U.S.) and so not all can be used to satisfy judgments under TRIA. Of those that can be used under TRIA, some have already been laid claim to by other plaintiffs. The Rubin plaintiffs did get $390,000 out of the sale of an Iranian-owned home in Texas, but the balance remained unpaid.

The plaintiffs next sought to seize Iranian artifacts showcased in U.S. museums and universities and put them up for auction to raise the funds necessary to satisfy the judgment. Some of the Persian antiquities under dispute are on loan to museums from the Iranian government; for others, the question of ownership is less clear (in the case, for example, of a private collector donating artifacts of Persian provenance to a museum in the U.S. – is the property still Iran’s?). Notably included in the collection the plaintiffs are after are thousands of clay tablets from the ancient city of Persepolis dating back to the Achaemenid Empire. To academics the tablets are priceless, but to the appraiser, each is valued at several thousand dollars.

In March 2008, a Massachusetts Federal District Court ruled that because the ownership of the Persian artifacts held at Harvard University and Boston Museum of Fine Arts was contested (the institutions claimed to own them and the plaintiffs claimed Iranian ownership due to a 1930s Iranian law restricting the export of cultural property without proper government authorization), they were subject to freeze and seizure under TRIA. Iran boycotted this dispute as well, so was unable to object to the plaintiff’s argument that Iran still claimed ownership. The artifacts housed in the two aforementioned institutions will be seized and auctioned unless they can reverse the ruling on appeal.

The Massachusetts court does not seem to have taken into account that the original 1979 asset freeze did not apply to informational materials, such as artworks, under an exception to the International Emergency Economic Powers Act (IEEPA), by which the freeze was enacted. One might argue that the Persian artifacts are in fact informational (considering they have been the subject of intense academic study) and thus should not be subject to freeze and seizure.

Rubin et al is also involved in a lawsuit against the University of Chicago for the Persian artifacts that it holds on behalf of Iran. In this case, the artifacts are very clearly the property of Iran, and the Illinois Federal District Court was able to get Iran involved by insisting that only Iran could claim immunity for itself (the U. of Chicago could not do so on its behalf). No decision has been made yet by the court.

The ruling of another, completely unrelated sovereign immunity case currently before the U.S. Supreme Court, may contribute to the final outcome in the cases of the Persian artifacts described above. In Republic of Iraq v. Beatty, the Supreme Court will decide whether the new Republic of Iraq has sovereign immunity under FSIA. The civil suit was filed by U.S. military and media who say they were seized and abused by Saddam Hussein’s Iraq during the 1991 invasion of Kuwait. The case pulls together lawsuits filed by 200+ plaintiffs that are looking for over $3 billion in damages against the new government for the injustices perpetrated by the old regime.

The aforementioned 1996 ‘terror state exemption’ to FSIA opened up the floodgates in the U.S. for civil suits against states that sponsor terrorism. The U.S. government has encouraged that these cases be dismissed, and former President Bush put a stop to suits against Iraq by removing it from the State Department’s terror list. Whether he had the right to do that has been left to the Supreme Court to decide in Republic of Iraq v. Beatty.

The fate of the Persepolis artifacts and Iraq’s coffers are still unknown, but it’s interesting to note that technically, unless ruled otherwise by the Supreme Court, the President can intervene and stop the seizure of property belonging to foreign sovereigns if doing do strengthens national security.

By Haggai Carmon

Former U.S. government employee Sabrina De Sousa (53) has sued the State Department for diplomatic immunity.

According to Italian officials, she is one of the 26 U.S. agents who participated in a CIA-orchestrated kidnapping that abducted a militant Egyptian clergy member working in Milan and transported him to his native country. De Sousa is after immunity from prosecution in Italy.

Hassan Mustafa Osama Nasr, the cleric kidnapped in February 2003, says he was incarcerated and tortured in Egypt. He is no longer in prison.

In Italy, an arrest warrant has been issued for De Sousa and the other 25 allegedly involved. De Sousa has been named one of the four main participants in the operation, but all 26 were indicted in 2007.

Although a naturalized American citizen, De Sousa was born in India. Her mother is still living there, and her siblings are in Europe. She says she was ordered not to travel internationally lest she be arrested, which means she has not been able to visit her scattered family.

It is believed by Italian officials that the kidnapping was part of a CIA rendition program, in which the CIA captured suspected terrorists and moved them to a third country for interrogation. When asked whether De Sousa worked for the CIA, her lawyer replied that she was “a federal employee working for the State Department.”

She no longer works for the government, having quit in February of this year, but she does not understand why diplomatic immunity has not been invoked in the kidnapping case. At the time, De Sousa was working as a consular official in Milan (though she says she was on vacation when Nasr disappeared). Her consular role, however, would seem to qualify her for consular immunity.

De Sousa believes politics may be to blame and by suing her previous employer is looking to have the problem “go away once and for all.” She asks rhetorically of the U.S. government, “If you’re going to fight this war on terror, are you going to protect your people?”

In Italy, meanwhile, the prosecution experienced a set back because an Italian court ruled certain evidence inadmissible due to the unlawful way in which it was procured. The prosecution is undeterred, however, and a hearing is scheduled for this month.