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Monday, August 26, 2013

Chicago Museums Seek Summary Judgment in Rubin v. Iran

The Field Museum of Natural History and the University of Chicago's Oriental Institute filed a motion for summary judgment last week seeking to end a case that has pitted victims of a terrorist attack against two Illinois museums and Iran. The Chicago-based institutions argue that the plaintiffs' wish to take museum "property that Iran neither owns nor has ever claimed." And regarding Persian artifacts owned by Iran but on loan to the museums, the museums say that the plaintiffs cannot take title to these objects in order to satisfy a court judgment. American lawyers representing Iran filed their own motion in agreement.

The museums offer three arguments in their legal memorandum to defend the ancient Persian collections known as the Persepolis Collection, the Chogha Mish Collection, the Herzfeld Collection, and the OI Collection. The lawyers write,
First, even if Plaintiffs could meet their burden to establish Iranian ownership of the collections at issue, those artifacts would irrefutably be immune from attachment under the Foreign Sovereign Immunities Act [FSIA]. To avoid that immunity, the law requires that Plaintiffs prove that Iran itself used these artifacts commercially. Plaintiffs have no such evidence.
The FSIA is a federal law that protects foreign states from lawsuits and makes foreign sovereign property located in the United States immune from attachment and execution. But the law makes an exception, stating that “[a] foreign state shall not be immune from the jurisdiction of courts … in which rights in property taken in violation of international law are in issue and that property … is present in the United States in connection with a commercial activity carried on in the United States by the foreign state … [or an] instrumentality of the foreign state ….”  (italics added). The museums argue that the Persian artifacts were not part of any Iranian commercial activity.

Second, the museums assert that the Terrorism Risk and Insurance Act (TRIA) cannot be used to take the artifacts. And another court, in fact, has already ruled on this issue, barring any reargument in Illinois. The attorneys write,
...Plaintiffs invoke the Terrorism Risk and Insurance Act (“TRIA”), which allows seizure of a terrorist party’s “blocked” assets. But the First Circuit recently rejected this very same argument made by these very same Plaintiffs in attachment proceedings against two Boston-area museums. Rubin v. Islamic Republic of Iran, 709 F.3d 49, 57-58 (1st Cir. 2013). That ruling is not only correct, it is also binding on Plaintiffs as a matter of collateral estoppel. The requisite “contest” under TRIA may not be created by judgment creditors purporting to stand in a foreign sovereign’s shoes.
Finally, the museums object to the plaintiffs' claim that they can attach the museums' property because Iran--and not the museums--own the artifacts. "The only basis for this claim is Plaintiffs’ speculation that the objects in the Museum Collections may have been unlawfully removed from Iran after 1930 and subsequently conveyed to the Field  Museum or the Oriental Institute," the lawyers say, adding "But Iran has never made a claim to the Museums’ property and, despite eight years of discovery, Plaintiffs have failed to adduce any evidence that Iran owns a single object in the Museum Collections." The Attorneys contend,
...although the Court need not reach the issue given the legal barriers that the FSIA and TRIA erect to Plaintiffs’ claims, these artifacts are owned by the Museums. Plaintiffs’ theory of Iranian ownership depends on an interpretation of a 1930 Iranian export law that is without merit. Indeed, several courts have rejected Plaintiffs’ theory and none, so far as we are aware, has accepted it. Moreover, the statute of limitations and the good faith purchaser rule are additional barriers to any claim of Iranian ownership. Ultimately, Plaintiffs simply cannot meet their legal burden to establish that the Museums hold property that is subject to attachment, or indeed, that belongs to Iran at all. Summary judgment should be entered in favor of the Museums...."
Iran similarly makes three arguments, based on the FSIA and TRIA statutes. The lawyers write in their legal memorandum,
The Fortification Texts [of the Persepolis Collection] and Chogha Mish objects are property of a foreign sovereign and therefore immune from attachment and execution. The FSIA’s commercial activities exception, 28 U.S.C. § 1610(a)(7), does not apply; Iran has never used the artifacts for a commercial purpose in the United States. While Plaintiffs urge that the Institute’s activities are attributable to Iran under an “agency” theory, it is implausible that the Institute is Iran’s “agent.” Iran merely lent the artifacts to the Institute for study, and Plaintiffs raise no material issue of fact for their agency theory. In any event, the Institute’s activities are academic, not commercial.
The lawyers further declare that "[t]he Fortification Texts and the Chogha Mish objects are not subject to execution under the TRIA ... because they are not 'blocked assets.'" By way of background, "blocked assets" are properties that have been seized or frozen by the U.S. government. The TRIA allows seizure of blocked assets to satisfy court judgments “in every case in which a person has obtained a judgment against a terrorist party on a claim based upon an act of terrorism, or for which a terrorist party is not immune under [the FSIA] ….” Iranian “blocked assets” as defined by the Iranian Assets Control Regulations are uncontested assets, meaning that there is no dispute about whether Iran holds title. With this in mind, lawyers for Iran submit in their legal memorandum that "[a]lthough Plaintiffs have urged that the artifacts are 'blocked' because their ownership is 'contested,' no contest exists. The Institute has never asserted title or ownership; it has always agreed that those artifacts belong to Iran. The United States agrees that the assets are not 'blocked.'"

Finally, Iran's attorneys offer the technical argument that the Rubin plaintiffs cannot use an exception under the FSIA law to acquire the artifacts, specifically § 1610(g). They write, "To the extent Plaintiffs assert that the Fortification Texts and the Chogha Mish objects are subject to attachment under § 1610(g) of the FSIA, they are mistaken. Plaintiffs cannot invoke § 1610(g) because they did not raise it before the Seventh Circuit."  The lawyers add,
That provision, moreover, at most subjects property of entities that are legally distinct from the sovereign (such as agencies and instrumentalities) to execution to satisfy a judgment against the sovereign—if that property otherwise lacks immunity because it falls within one of § 1610’s express exceptions. Consequently, §1610(g) is inapplicable. And § 1610(g) applies only to judgments entered under § 1605A. Plaintiffs’ judgment was entered under § 1605(a)(7), and retroactive conversion of Plaintiffs’ judgment would violate separation of powers.
The case of Jenny Rubin, et al. v. Islamic Republic of Iran v. The Oriental Institute et al. began in the Illinois federal district court in 2003 after Rubin and the other plaintiffs won a $71.5 million default court judgment against Iran for that country's role in supporting a 1997 terror attack launched by Hamas. To get Iran to satisfy its judgment, the plaintiffs sued the Field Museum and the Oriental Institute for the ancient Iranian artifacts.

The litigation traveled from the Northern District of Illinois to the Seventh Circuit Court of Appeals, and was later sent back to the district court. But the Rubin plaintiffs sought review along the way by the U.S. Supreme Court. The nation's high court returned the case to the district court last year after declining to hear the Rubin plaintiffs' request to critique the Seventh Circuit's appellate decision.

UPDATE: The plaintiffs in the litigation filed responses to the museums' motion for summary judgment in November and December 2013.

Photo credit: sumeja

This post is researched, written, and published on the blog Cultural Heritage Lawyer Rick St. Hilaire at culturalheritagelawyer.blogspot.com. Text copyrighted 2010-2013 by Ricardo A. St. Hilaire, Attorney & Counselor at Law, PLLC. Any unauthorized reproduction or retransmission of this post is prohibited. CONTACT INFORMATION: www.culturalheritagelawyer.com