US appeals court reverses $1.68 billion judgment against Iran

The 2nd US Circuit Court of Appeals in Manhattan ruled that a lower court should have addressed specific state law questions before deciding against Bank Markazi (the Central Bank of Iran) and intermediary Clearstream Banking, a subsidiary of Deutsche Boerse, Reuters reported.

In a unanimous 3-0 decision, the appellate panel also dismissed a claim that a 2019 federal law, aimed at facilitating the seizure of Iranian assets held outside the US, waived Bank Markazi’s sovereign immunity.

This law “neither abrogates Bank Markazi’s jurisdictional immunity nor provides an independent grant of subject matter jurisdiction,” wrote Circuit Judge Robert Sack.

The case has been sent back to US District Judge Loretta Preska in Manhattan to determine the state law implications and to assess whether the case can proceed in the absence of Bank Markazi.

The case had been filed by family members of troops killed and injured in the 1983 bombing of the US Marine Corps barracks in Beirut.

Iran has consistently criticized US legal actions targeting Iran's assets, asserting that such measures violate international law and Iran's sovereign rights. In response to the US confiscation of $1.6 billion of Iranian assets in Luxembourg, the Central Bank of Iran (CBI) stated that the Islamic Republic has repeatedly protested such actions and registered its complaint against the US officially in the International Court of Justice, seeking a declaration of the illegality of these rulings and a mandate for the US to cease such practices.

At that time, Majid Takht-Ravanchi, Iran’s Deputy Foreign Minister for Euro-American Affairs, highlighted that the frozen assets were inaccessible due to sanctions, which had prevented Iran from using its European-held funds prior to the nuclear negotiations that led to the signing of the JCPOA. He criticized the broader US effort to apply such rulings internationally, calling them “unfair and baseless.”

SD/