SCOTUS Rules US Terror Victims Can Collect $2B From Iran

The Supreme Court cleared the way on Wednesday for families of American victims of terrorism to collect nearly $2B in frozen assets from Iran's central bank.

The 6-2 decision is a win for more than 1,000 victims of Iran's state-sponsored terrorist actions across decades, including the '83 Marine barracks bombing in Beirut that killed 241 American servicemen and the '96 attacks on Saudi Arabia's Khobar Towers.

Gibson Dunn's Ted Olson argued for the victims; MoLoLamken's Jeff Lamken argued for Bank Markazi, the Central Bank of Iran.

The question centered on whether Congress had unconstitutionally overstepped into the judiciary's role by directing—through an amendment of an anti-terrorism law—that the close to $2B in concealed Iranian funds held in a New York Citibank account had to be used to pay victims of terrorist attacks.

The majority opinion, written by Justice Ruth Bader Ginsburg, said the statute "does not transgress constraints placed on Congress and the President by the Constitution" and is "no threat to the independence of the Judiciary."

Though Bank Markazi argued that the amended statute specified the outcome of the case, the Court's decision says that the Bank's argument is flawed as it "rests on the assumption that legislation must be generally applicable, that 'there is something wrong with particularized legislative action.' We have found that assumption suspect."

Rather, the statute is "an exercise of congressional authority regarding foreign affairs, a domain in which the controlling role of the political branches is both necessary and proper." Foreign policy action by the President and Congress "warrants respectful review by courts."

Chief Justice John Roberts, in a dissent joined by Justice Sonia Sotomayor, warned this decision will "become a 'blueprint for extensive expansion of legislative power' at the Judiciary's expense."

The dissent adds that the potential of today's decision "'to effect important change in the equilibrium of power' is 'immediately evident.'"

With the statute, Roberts writes, Congress violated Article III to interfere with the judicial function, and "decided this case by enacting a bespoke statute tailored to this case that resolves the parties’ specific legal disputes to guarantee respondents victory."