By ADAM LIPTAK April 20 2016
WASHINGTON — Iran’s central bank must pay nearly $2 billion to victims of terrorist attacks, the Supreme Court ruled on Wednesday.
In a 6-to-2 decision, the court said Congress had not exceeded its constitutional role in enacting a statute to make it easier for the plaintiffs to recover damages that had been awarded to them in a series of lawsuits.
The cases were brought by the families of Americans killed in terrorist attacks found to have been sponsored by Iran, including relatives of those who died in the 1983 Marine Corps barracks bombing in Lebanon. That attack killed 241 servicemen.
The plaintiffs sought to collect frozen funds from Bank Markazi, Iran’s central bank, relying on a 2012 federal law, the Iran Threat Reduction and Syria Human Rights Act, that made the task easier by specifying assets of the bank that could satisfy the plaintiffs’ judgments. The law was quite specific, naming a single, pending consolidated case by caption and docket number.
As a trial judge put it, the law “sweeps away” any “federal or state law impediments that might otherwise exist” to letting the plaintiffs obtain the money.
The bank responded that the law violated the Constitution because it was focused on a single case and compelled courts “to reach a predetermined result.”
Justice Ruth Bader Ginsburg rejected the argument, saying Congress has the power to alter legal standards in existing cases.
In dissent, Chief Justice John G. Roberts Jr. said, “There has never been anything like” the 2012 law.
“Hereafter,” he wrote, “with this court’s seal of approval, Congress can unabashedly pick the winners and losers in particular pending cases.”
But Justice Ginsburg said the law was fairly routine, listing earlier ones that applied to given railroads, a single bridge, a specific settlement agreement and one oil tanker.
“Congress may indeed direct courts to apply newly enacted, outcome-altering legislation in pending civil cases,” she wrote, adding that “a statute does not impinge on judicial power when it directs courts to apply a new legal standard to undisputed facts.”
The 2012 law, she wrote, “provides a new standard clarifying that, if Iran owns certain assets, the victims of Iran-sponsored terrorist attacks will be permitted to execute against those assets.”
“Applying laws implementing Congress’ policy judgments, with fidelity to those judgments, is commonplace for the judiciary,” Justice Ginsburg wrote.
In any event, Justice Ginsburg wrote, the 2012 law still left courts with work to do, as it did not define key terms. Courts were required to sort out questions over the ownership and location of assets, she added.
The decision, in Bank Markazi v. Peterson, No. 14-770, came as the United States and Iran have taken steps to ease tensions. Justice Ginsburg said the court should be wary of intruding on judgments made by Congress and the president in the conduct of foreign affairs.
“Congress passed, and the president signed” the 2012 law, Justice Ginsburg wrote, “in furtherance of their stance on a matter of foreign policy. Action in that realm warrants respectful review by courts.”
The Obama administration supported the plaintiffs in the Supreme Court.When the case was argued in January, a lawyer for the administration drew a distinction between laws intended solely to pick a winner in a pending case and ones that changed the applicable law, even if only for a pending case.
Chief Justice Roberts said that was a distinction without a difference. “You’re saying Congress has to be cute about it,” he said.
Justices Anthony M. Kennedy, Stephen G. Breyer, Samuel A. Alito Jr., and Elena Kagan joined all of Justice Ginsburg’s opinion. Justice Clarence Thomas joined most of it, but he noted without explanation that he did not accept the part of the opinion concerning the deference due the other branches in matters of foreign affairs.
In dissent, Chief Justice Roberts, joined by Justice Sonia Sotomayor, said the majority had yielded too much power to Congress.
“No less than if it had passed a law saying ‘respondents win,’” the chief justice wrote, “Congress has decided this case by enacting a bespoke statute tailored to this case that resolves the parties’ specific legal disputes to guarantee respondents victory.”
The 2012 law, he wrote, allowed Congress to assume a role that the Constitution had committed to the judiciary, “changing the law — for these proceedings alone — simply to guarantee that respondents win.”
“At issue here is a basic principle, not a technical rule,” Chief Justice Roberts wrote, one that he said, quoting a 1988 dissent from Justice Antonin Scalia, may “effect important change in the equilibrium of power.”