This version contains a revision
On February 21, 2018, the Supreme Court of the United States issued a decision,[1] affirming the United States Court of Appeals for the Seventh Circuit’s 2016 decision[2] that held that a collection of ca. 30,000 ancient Persian artifacts[3] that have been on loan to the University of Chicago’s Oriental Institute since 1937 is immune from attachment and execution to satisfy a judgment against the Islamic Republic of Iran. The decision concluded a decades-long effort by the plaintiffs, a group of American citizens seriously injured in a suicide bombing in Jerusalem in 1997.[4] The plaintiffs sued the Islamic Republic of Iran in U.S. District Court for the District of Columbia for Iran’s role in providing material support to the terrorists, and obtained a $71.5 million default judgment (and an additional $300 million in punitive damages). [5]
The Persepolis Collection and Other Persian Artifacts
The plaintiffs initially sought to execute on the judgment against “four collections of ancient Persian artifacts ... the Persepolis Collection, the Chogha Mish Collection, and the Oriental Institute Collection, all in the possession of the University of Chicago; and the Herzfeld Collection, split between the University and Chicago’s Field Museum of Natural History.”[6] However, the court only had jurisdiction to consider attachment and execution upon those artifacts that were (1) owned by Iran, and (2) within the territorial jurisdiction of the court. During the pendency of the case, the Chogha Mish Collection was returned to Iran as a matter of cultural diplomacy, and so was not within the court’s territorial jurisdiction. The Oriental Institute Collection and the Herzfeld Collections (at both the University of Chicago and the Field Museum) are not the property of Iran, and so also were not available for attachment and execution. Only the Persepolis Collection met both requirements, being both property of Iran (on long-term loan to the University of Chicago) and located within the court’s territorial jurisdiction.
The Seventh Circuit issued its decision on July 19, 2016, holding that Section 1610(g) of the Foreign Sovereign Immunities Act (“FSIA”)[7] does not provide an independent basis to attach and execute against US-based property of a foreign state to satisfy a 1605A judgment. Rather, Section 1610(g) only operates when the subject property is exempt from immunity under a separate exception set forth in Section 1610. In so holding, the Seventh Circuit split with the Ninth Circuit’s decision in Bennett v. Islamic Republic of Iran,[8] which had held that Section 1610(g) did provide an independent basis to strip immunity from sovereign property located in the U.S. The Supreme Court took up the case to resolve this split, and to clarify the application of Section 1610(g) to questions of execution immunity for sovereign property.
Foreign Sovereign Immunity
The fate of the Persepolis Collection turned on the fairly arcane question of foreign sovereign immunity. As a general rule, foreign states have immunity from the jurisdiction of U.S. courts (jurisdictional immunity)[9] and their property located in the United States is immune from attachment, arrest, and execution (execution immunity).[10] Until the mid-twentieth century, the United States (and most other countries) observed the doctrine of absolute sovereign immunity, and no foreign state could be subject to the jurisdiction of the courts of another state. Early in the Nineteenth Century, the Court addressed the question of the doctrine of absolute sovereign immunity, which the Court stated derives from the “perfect equality and absolute independence of sovereigns.”[11] Foreign sovereign immunity was regarded as “a matter of grace and comity on the part of the United States,”[12] and was a function of the Executive Branch’s foreign affairs power. Under the absolute sovereign immunity doctrine, when a foreign sovereign was sued in a U.S. court, the foreign state would request a “suggestion of immunity” from the U.S. State Department. If the State Department granted the request, the court would surrender jurisdiction and the case would be dismissed.
In 1952, the U.S. abandoned the absolute sovereign immunity doctrine in favor of the restrictive theory of sovereign immunity, which was articulated in what has come to be called the Tate Letter, written by...
