The Supreme Court ruled Wednesday in favor of victims of terrorism and their families in a 6-2 split, clearing the way for them to collect nearly $2 billion from the central bank of Iran.
The court decided Congress had not exceeded its authority when it passed a law aimed specifically at securing such restitution.
"(The law) 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," Justice Ruth Bader Ginsburg, writing the majority. "Applying laws implementing Congress' policy judgments, with fidelity to those judgments, is commonplace for the Judiciary."
The ruling comes at a sensitive time of U.S.-Iran relations, and as Congress considers controversial legislation that would allow families of 9/11 victims to sue Saudi Arabia.
Chief Justice John Roberts, joined by odd bed fellow Justice Sonia Sotomayor, dissented from the majority opinion, saying Congress had interfered with the role of the judiciary in passing the law while the case was pending in the courts.
"No less than if it had passed a law saying 'respondents win,' 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," he said.
Roberts said the law "violates the bedrock rule" that the "judicial power is vested in the judicial branch alone."
The lead plaintiff was Deborah Peterson, whose brother, Lance Cpl. James C. Knipple of Alexandria, Virginia, was killed in the Beirut barracks bombing in 1983.
In 2001, the Peterson plaintiffs, along with family members and the estates of 241 Beirut bombing victims, filed suit in U.S. courts against Iran. Six years later, a federal district court held that the evidence presented by the Peterson plaintiffs established Iran's liability, and the following year, the plaintiffs were informed that the Bank of Markazi had $1.75 billion in assets held in an account in New York.
"Today's ruling is a major victory not just for the plaintiffs in their quest to hold the Iranian government responsible for acts of terrorism, but for Congress in its ability to change the rules of pending lawsuits even as they're unfolding," said Steve Vladeck, professor of law at American University Washington College of Law and CNN legal analyst.