110th Congress.(Suits Against Terrorist States by Victims of Terrorism)

The National Defense Authorization Act for FY2008, [section] 1083

The Justice for Victims of State Sponsored Terrorism Act, S. 1944, was passed by the Senate as Section 1087 of the National Defense Authorization Act for Fiscal Year 2008 (NDAA FY2008), H.R. 1585. A modified version of the provision, a measure to facilitate lawsuits against terrorist States, was included by House and Senate Conferees as section 1083, Terrorism Exception to Immunity. (178) After President Bush vetoed H.R. 1585 due to the negative impact the measure was predicted to have on Iraq's economy and reconstruction efforts, (179) Congress passed a new version, H.R. 4986, which includes authority for the President to waive the FSIA provision with respect to Iraq. The President signed the bill into law on January 28, 2008. (P.L. 110-181).

Cause of Action and Abrogation of Immunity. Section 1083 creates a new section 1605A in title 28, U.S. Code, to incorporate the terrorist State exception to sovereign immunity under the FSIA previously codified at 28 U.S.C. [section] 1605(a)(7) and a cause of action against designated State sponsors of terrorism, in lieu of the Flatow Amendment. The exception to immunity and new cause of action against such States apply to cases in which money damages are sought for personal injury or death caused by certain defined terrorist acts or the provision of material support when conducted by an official, agent, or employee of the State acting within the scope of his or her office, employment, or agency, regardless of whether a U.S. official could be held liable under similar circumstances.

The cause of action is stated in subsection (c) of new [section] 1605A, and covers foreign terrorist States as well as their agents, officials and employees, making them liable for personal injury or death caused by acts for which the courts of the United States may maintain jurisdiction under the subsection. It spells out the types of damages that may be recovered, including economic damages, solatium, pain and suffering, and punitive damages. (180) The foreign State is to be held vicariously liable for the actions of its officials, employees, or agents. Subsection (d) provides that, in connection with the personal injury claims it authorizes, actions may also be brought for reasonably foreseeable property loss, regardless of insurance coverage, for third party liability, and for life and property insurance policy losses.

New 28 U.S.C. [section] 1605A expands jurisdiction beyond cases involving U.S. nationals as a victim or claimant, expressly to include U.S. nationals, members of the Armed Forces, (181) and government employees and contractors "acting within the scope of their employment when the act upon which the claim is based occurred." As was previously the case, if the act giving rise to the suit occurred in the foreign State being sued, the claimant must first afford that State a reasonable opportunity to arbitrate the claim. The language also directs that claims be heard in cases in which the "act [of terrorism] ... is related to Case Number 1:00CV03110 (EGS) in the United States District Court for the District of Columbia," notwithstanding the other jurisdictional requirements listed. This appears intended to enable those held hostage at the U.S. embassy in Iran to bring suit, although the named case was ultimately dismissed. (182) However, the language does not expressly abrogate the Algiers Accords, making a victory for those plaintiffs seemingly unlikely in the event they refile their claims. (183)

Limitations and Procedures. The statute of limitations for claims under the act requires the commencement of an action within 10 years after April 24, 1996 or 10 years from the date on which the cause of action arose. (184) But new lawsuits are barred six months after a defendant State has been removed from the list of State sponsors of terrorism. (185)

Subsection (c)(2) amends the Victims of Crime Act by changing the effective date to October 23, 1988 (instead of December 21, 1988), and expressly includes investigations in civil matters. This will make available funds under the Victims of Crime Act, 42 U.S.C. [section] 10603(c), to pay costs associated with appointment of a special master to determine civil damages for the bombing of the Marine barracks in Lebanon in 1983. (186) Subsection (e) provides for the appointment of special masters to assist the court in determining claims and damages, to be funded from the Victims of Crime Act of 1984 for victims of international terrorism (42 U.S.C. [section] 10603c). Subsection (f) makes interlocutory appeals subject to 28 U.S.C. [section] 1292(b), which limits interlocutory appeals.

Lis Pendens. Section 1083 does not expressly provide for prejudgment attachment of property in anticipation of a judgment. (187) However, new 28 U.S.C. [section] 1605A(g) provides for the establishment of an automatic lien of lis pendens with respect to all real or tangible personal property (188) located within the judicial district that is subject to attachment in aid of execution under 28 U.S.C. [section] 1610 and is titled in the name of a defendant State sponsor of terrorism or any entities listed by the plaintiff as "controlled by" that State, (189) upon the filing of a notice of action in complaints that rely on the terrorism exception to the FSIA. The liens of lis pendens are expressly made enforceable pursuant to chapter 111 of title 28, U.S. Code. That chapter, however, does not establish federal procedures for enforcing lis pendens, although it does provide procedures for the enforcement of other liens in the event a defendant fails to enter an appearance. (190) Federal law provides for the application of state law regarding lis pendens, (191) and these rules vary by state. (192) Ordinarily, …