Setback for Iran as US court orders $1.68 billion payout for 1983 Beirut bombing

A US judge ordered Iran on Wednesday to pay nearly $1.7 billion to the families of US soldiers killed in the 1983 Beirut bombing. The ruling may be appealed, but the order constitutes a legal setback for the Iranian government and could further damage US-Iran relations. 

Background: Reuters reported that judge Loretta Preska in the US District Court in the Southern District of New York ordered Iran’s central bank and the Luxembourg-based Clearstream Banking SA to pay $1.68 billion to the families of the US Marines who died. Clearstream is currently holding the relevant assets in a fund. 

The case relates to the 1983 attack when two suicide bombers used truck bombs to blow up barracks housing US Marines and French soldiers in Lebanon. The soldiers were in the country as part of an international peacekeeping mission amid the Lebanese civil war. A total of 241 US soldiers and 58 French soldiers were killed, in addition to six civilians and the two suicide bombers. 

A group known as Islamic Jihad took credit for the attack. US officials have long accused Iran and its Lebanese militant proxy Hezbollah of being involved in the attack. There is no consensus that Hezbollah existed at the time, though it emerged in Lebanon in the 1980s. 

There have been numerous legal proceedings against the Iranian government since then. A 2020 US Supreme Court decision ordered the case to be reconsidered due to the 2019 National Defense Authorization Act. Preska determined that this law enabled the families to seize the assets, according to Reuters. 

Clearstream's parent company, Deutsche Boerse AG, told Reuters it is considering an appeal. In the past, the Iranian central bank argued that it has sovereign immunity. This principle grants legal immunity to foreign governments in other governments’ legal systems. 

US courts have rejected this argument in a different case involving Iran. In 2019, the US Justice Department charged Turkey's Halkbank with helping Iran evade US sanctions. Halkbank, which is majority owned by the Turkish state, claimed sovereign immunity, but two US courts rejected Halkbank's past appeals. The US Supreme Court heard arguments for the case in January. 

Lawyers for the victims' families and the Iranian central bank did not respond to Al-Monitor’s request for comment. The Iranian government did not appear to immediately comment on the ruling. 

Why it matters: The ruling could result in the families finally receiving compensation, according to some observers. 

Matthew Levitt, a fellow at the Washington Institute for Near East Policy, told Al-Monitor, “Clearstream may try to appeal, so payment may be delayed, but it is likely to happen at least in part.”

Levitt, who previously served as a senior official on terrorism and financial intelligence at the US Treasury Department, said the judge’s decision is a blow to the Iranian government.  

“Cases such as these will not on their own put an end to Iranian-sponsored terrorism, but they do exact a tangible cost,” he said. “It is not just a factor of the financial judgement, but also the findings of guilt by a federal court that provide important messaging holding Iran accountable as a rogue actor in the court of public opinion.” 

The ruling could also further damage US-Iran relations. US President Joe Biden resumed talks with the Iranian government in 2021 on the latter's nuclear program, but those negotiations have stumbled over Iran's support for Russia's invasion of Ukraine and the ongoing protests in Iran. 

The Iranian government has criticized US court rulings on the Beirut bombing in the past. In 2016, then-Iranian President Hassan Rouhani called a ruling in the families' favor at the time a “continuation of hostilities against Iran.” 

Know more: Iran continues to maintain strong relations with Hezbollah. On Thursday, the head of Iran’s Foreign Relations Strategic Council, Kamal Kharrazi, met with Hezbollah leader Hassan Nasrallah in Beirut. Kharazzi brought a political and economic delegation to Lebanon and discussed regional developments with Nasrallah, the official Islamic Republic News Agency reported.