Estate of John Doe v. Islamic Republic of Iran

943 F. Supp. 2d 180, 2013 WL 1908987, 2013 U.S. Dist. LEXIS 65903
CourtDistrict Court, District of Columbia
DecidedMay 9, 2013
DocketCivil Action No. 2008-0540
StatusPublished
Cited by44 cases

This text of 943 F. Supp. 2d 180 (Estate of John Doe v. Islamic Republic of Iran) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Estate of John Doe v. Islamic Republic of Iran, 943 F. Supp. 2d 180, 2013 WL 1908987, 2013 U.S. Dist. LEXIS 65903 (D.D.C. 2013).

Opinion

MEMORANDUM OPINION

JOHN D. BATES, District Judge.

Shortly after 1 p.m. on April 18, 1983, an unidentified driver rammed a vehicle laden with more than a ton of explosives into the United States Embassy in Beirut, Lebanon. Sixty-three people perished and scores of others were injured in the result *183 ing explosion. In the aftermath of the attack, the Embassy moved its operations to a new location, the Embassy Annex. On September 20, 1984, another bomb detonated at the Annex. At least eleven people were killed and over fifty others were injured. Many of the victims had themselves survived the 1983 bombing; most had family members and friends who had been injured or killed in the first attack.

The 1983 Embassy bombing was the first large-scale attack against a United States embassy anywhere in the world, and it marked the onset of decades of terrorism against the United States. See Dammarell v. Islamic Republic of Iran, No. 01-2224, 2005 WL 756090, *1 (D.D.C. Mar. 29, 2005). Evidence emerging shortly after the attacks and mounting in the years since has shown that the attacks were carried out by the terrorist group Islamic Jihad, known most commonly as Hezbollah, operating with Iranian support and encouragement. Testifying in Dammarell, one of the related cases that support this action, expert Patrick Clawson explained that “there’s no question that Iran was responsible for the selection of the target, provided much of the information for how to carry out the bombing, the expertise for how to build the bomb, the political direction that said that this was an important target to bomb, [ and] provided financial support for the bombers.’ ” See Estate of Doe v. Islamic Republic of Iran, 808 F.Supp.2d 1, 8-9 (D.D.C.2011) (quoting Ex. 17 (Tr. Vol. II at 20-21)). In an earlier ruling in this case, the Court found, consistent with several other cases in this district, that Iran and its Ministry of Information and Security (“MOIS”) directed and facilitated the 1983 and 1984 attacks. See id. at 14-16.

Plaintiffs bring this case pursuant to the Foreign Sovereign Immunities Act (“FSIA”). A 1996 amendment to the FSIA revoked sovereign immunity protection for terrorist-sponsoring governments. Using this provision, the victims of such attacks have brought several mass-tort lawsuits against the Islamic Republic of Iran and its Ministry of Information and Security (“MOIS”). Although the waiver of sovereign immunity initially applied only where a victim or claimant was a United States citizen, see 28 U.S.C. § 1605(a)(7)(B)(ii) (2007) (repealed), a 2008 amendment to the FSIA has expanded jurisdiction to cases where the victims were foreign national employees of the United States government, killed or injured while acting within the scope of their employment. See National Defense Authorization Act for Fiscal Year 2008, § 1083, Pub. L. No. 110-181, 122 Stat. 3, 338 (codified at 28 U.S.C. § 1605A). Here, plaintiffs are one U.S. national and 58 foreign national employees of the U.S. Embassy killed or injured in either of the two attacks, and 255 immediate family members of the victims.

In a prior ruling in this case, the Court found that it has jurisdiction over Iran and other defendants and held that the U.S. government employees have a federal cause of action, while their family members may pursue their claims under District of Columbia law. The Court entered a final judgment of liability in favor of plaintiffs and referred plaintiffs’ claims to Magistrate Judge John Facciola to prepare proposed findings and recommendations for a determination of damages. See Estate of Doe, 808 F.Supp.2d at 23-24.

After receiving evidence, Judge Facciola has filed a thorough 220-page Report & Recommendation. See Report and Recommendation [Docket Entry 105] (Apr. 30, 2013). The Report & Recommendation extensively describes the key facts relevant to each of the more than 300 plaintiffs’ claims and carefully analyzes their claims *184 under the framework established in prior mass tort cases related to terrorism. The Court commends Judge Facciola for his excellent work and thoughtful analysis. The Court will adopt the Report and Recommendation in substantial part, with a few adjustments as described below. As a result, the Court will award plaintiffs a total judgment in the amount of over $8.4 billion.

I. Prejudgment Interest

Magistrate Judge Facciola recommends an award of prejudgment interest. The Court agrees that an award of prejudgment interest at the prime rate is appropriate in this case. See Oldham v. Korean Air Lines Co., Ltd., 127 F.3d 43, 54 (D.C.Cir.1997); Forman v. Korean Air Lines Co., Ltd., 84 F.3d 446, 450-51 (D.C.Cir.1996). 1

Unlike the Report & Recommendation, however, the Court will calculate the interest using the prime rate for each year rather than the average prime rate from 1984 to 2013. In Forman, the leading case to assess prejudgment interest, the D.C. Circuit explained that the prime rate — the rate banks charge for short-term unsecured loans to creditworthy customers — is the most appropriate measure of prejudgment interest, one “more appropriate” than more conservative measures such as the Treasury Bill rate, which represents the return on a risk-free loan. See 84 F.3d at 450 (emphasis omitted). In reaching this conclusion, the D.C. Circuit did not expressly consider the best measure of the prime rate, although it approved the “district court’s award of prejudgment interest at the-prime rate for each year between the accident and the entry of judgment.” See id. at 450 (emphasis added).

Using the average prime rate over the entire period might well be a permissible estimate. Some courts have used the average prime rate for the relevant decade in calculating prejudgment interest. See Matter of Oil Spill by Amoco Cadiz Off Coast of France on March 16, 1978, 954 F.2d 1279, 1335 (7th Cir.1992) (“The French parties say that the average prime rate during the 1980s was 11.9% .... Because Amoco has not challenged the proposed rate of 11.9%, we adopt it.”). But using the rate for each year is more precise. It measures how much the award would have grown between 1983 and 1984 using the 1984 interest rate, then measures how much that total would have grown between 1984 and 1985 using the 1985 interest rate, and so on. The difference is substantial where, as here, prime rates were vastly higher longer ago.

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943 F. Supp. 2d 180, 2013 WL 1908987, 2013 U.S. Dist. LEXIS 65903, Counsel Stack Legal Research, https://law.counselstack.com/opinion/estate-of-john-doe-v-islamic-republic-of-iran-dcd-2013.