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US Supreme Court Will Hear CBI Appeal
Economy, Business And Markets

US Supreme Court Will Hear CBI Appeal

The US Supreme Court on Thursday agreed to consider whether Iranian funds worth $1.75 billion must be turned over to families of the victims of the 1983 bombing of a US Marine Corps barracks in Beirut.
The appeal was one of 13 new cases the Supreme Court added to its docket Thursday, its first such action since the justices returned from a three-month summer break.
Reports said the court agreed to hear an appeal filed by Bank Markazi, the Central Bank of Iran (CBI). The bank is contesting a July 2014 ruling by the New York-based 2nd Circuit Court of Appeals, which said the money, currently held in a trust account in New York, should be handed over.
Money would be used to pay off a $2.65 billion judgment the victims' families won in a US court against Iran in 2007, Reuters said in a dispatch.
CBI has said in its petition to the Supreme Court that Congress acted improperly by passing legislation in 2012 specifically allowing victims to seize the money. The bank argued lawmakers violated the separation of powers by legislating the outcome of a court case.
It said the funds were part of its foreign currency reserves. The money was held in a Citibank account maintained by a Luxembourg financial intermediary doing business with an Italian bank that in turn did business with Markazi. The funds are being supervised by a court-appointed trustee.

 In Violation of 1955 Iran-US Treaty
The legal question is whether a 2012 law passed by the US Congress that specifically addressed the funds at issue in the dispute violates the US Constitution by dictating the outcome of a court case. The bank also says the appeals court ruling violates a 1955 US-Iran treaty, known as the ‘Treaty of Amity’.
The lawsuit was filed in 2010 after the US Treasury Department uncovered the funds at Citibank, part of Citigroup Inc.
The high court’s action comes at a delicate time in American-Iranian relations, with the United States and other world powers in July reaching an agreement to curb Iran’s nuclear program in exchange for lifting economic sanctions. The Obama administration had urged the court not to take up the case.
It will hear oral arguments and decide the case in its new term, which begins next week and ends in June 2016. The case is Bank Markazi v. Peterson, US Supreme Court, No. 14-770.
According to the Wall Street Journal, among the other cases, the court has stepped into a long-running dispute between Reynolds American Inc. and the European Union. The EU has accused subsidiaries of the tobacco giant of orchestrating an international money-laundering operation to finance the sale of cigarettes through what it says are “organized crime, sanctioned regimes and terrorist groups.”
Caption: CBI has said in its petition to the Supreme Court that Congress acted improperly by passing legislation in 2012.

 

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