## Facts

- More than a thousand plaintiffs (terrorism victims and family members) brought civil actions against the Islamic Republic of Iran, a designated state sponsor of terrorism since 1984.
- Many plaintiffs had obtained large default judgments under the prior FSIA terrorism exception, based on findings that Iran provided material support to terrorist groups responsible for attacks harming U.S. nationals.
- Despite final judgments totaling billions of dollars, collection efforts were largely unsuccessful due to limits on reachable sovereign assets and other barriers to enforcement.
- Congress repealed the prior terrorism exception and enacted 28 U.S.C. § 1605A (via the National Defense Authorization Act for FY 2008), creating a new federal cause of action and providing procedures for certain plaintiffs to refile or “convert” earlier cases.
- The court consolidated and coordinated common questions across many Iran-related terrorism actions, including how § 1605A applies to pending matters and to cases with existing final judgments.

## Issues

1. Whether § 1605A’s retroactive application and “conversion/refiling” provisions impermissibly intrude on Article III by reopening or dictating outcomes of final federal court judgments.
2. How § 1605A should be implemented in coordinated proceedings to effect Congress’s remedial aims while preserving constitutional limits and judgment finality.
3. Whether punitive damages remain available under the post-2008 FSIA terrorism framework.

## Decision

- The court upheld the constitutionality of § 1605A and its related conversion/refiling provisions against Article III and separation-of-powers challenges.
- The court determined that § 1605A does not annul or legislatively revise final judgments; it creates a new cause of action and permits eligible plaintiffs to pursue it through specified procedures.
- The court reaffirmed the availability of punitive damages under the FSIA terrorism cause of action as implemented after the 2008 statutory changes.
- The court allowed the consolidated cases to proceed under § 1605A, applying management guidelines consistent with constitutional constraints and the doctrine of finality.

## Legal Principles

- Congress may change jurisdiction and substantive law with retroactive effect, but it may not command a particular result in a specific case or require courts to reopen final judgments in violation of Article III.
- A statute that provides a new cause of action and a procedural path for qualifying litigants to invoke it can be applied consistently with separation of powers, so long as it does not require the judiciary to vacate or nullify prior final judgments.
- The FSIA terrorism framework after enactment of § 1605A supports a remedial construction that advances compensation and deterrence objectives within constitutional boundaries.
- Punitive damages may be awarded in terrorism actions brought under § 1605A against a state sponsor of terrorism, consistent with prior FSIA terrorism jurisprudence as codified and extended by Congress.

## Conclusion

The court sustained § 1605A as a constitutional, remedial restructuring of terrorism litigation against foreign state sponsors, authorized qualified plaintiffs to proceed under the new cause of action through conversion or refiling mechanisms, and confirmed that punitive damages remain available under the post-2008 FSIA terrorism regime.


In re Islamic Republic of Iran Terrorism Litigation, 659 F. Supp. 2d 31 (D.D.C. 2009)