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Argument Recap: Iraq v. Beaty

The Stanford clinic summarizes Monday’s argument in Republic of Iraq v. Beaty. Please note that Tom Goldstein represented the respondents. The briefs for the case can be found at the SCOTUSWiki page here.

Jonathan Franklin, representing the Republic of Iraq, received relatively few questions from the Court.  He began with Iraq’s main theory of the case: that President Bush validly made Section 1605(a)(7) inapplicable to Iraq, thus depriving plaintiffs jurisdiction to proceed with the suit, and pushed back against small inroads in the theory from Justices Ginsburg and Alito. In particular, Justice Ginsburg pressed Franklin to provide an example of a statute in which Congress stripped U.S. courts of jurisdiction without announcing its intention to do so.

The United States, represented by Douglas Hallward-Driemeier, made an argument similar to Iraq’s, contending that Section 1503 of the EWSAA allowed the President to make exceptions to laws that applied to state-sponsored terrorism, and the state-sponsored terrorism exception to sovereign immunity falls precisely in that category. But even if one accepts the D.C. Circuit’s “atextual” reading of the statute in Acree, Hallward-Driemeier continued, that Section 1503 only dealt with statutes that stood as an obstacle to funding a post-war Iraq, sovereign immunity would be included, as lawsuits could draw billions of dollars from Iraq’s coffers.

Justice Ginsburg seemed interested in the practical effect of a holding against Iraq – whether creditors could actually collect against Iraq’s assets. And the Chief Justice focused on whether there would be jurisdiction for the suit absent Bush’s EWSAA waiver. Justice Ginsburg challenged the notion that the Court should defer to the President in this case, given that Congress through FSIA specifically limited his powers in this area.

Arguing for the respondents, Thomas Goldstein argued that the EWSAA gave the President the power to rescind Iraq’s designation of a terrorist state, as opposed a stronger power (such as writing “except for Iraq” into 1605(a)(7)). Because changing designation doesn’t affect Iraq’s liability for past terrorist acts, the current case should be able to proceed.

Justices Souter and Kennedy, as well as the Chief Justice, pressed Goldstein on Congress’s reasons for making such a fine distinction. Goldstein explained that Congress would make that distinction because when the EWSAA was passed, it was only days after the fall of the Iraqi government, and the President needed to immediately rescind certain sanctions provisions as they pertained to Iraq. Under the existing statutory scheme, however, the President would not be authorized to do that until Iraq was recognized as a country, nearly a year later. EWSAA was meant to address the immediate and short-term economic health of Iraq.

Justices Scalia, Souter, Stevens, and Breyer then questioned Goldstein on why Congress would choose to use the word “any” in the EWSAA if it did not mean it to apply to literally any statute, including jurisdictional statutes. After a back-and-forth with Justice Breyer, Goldstein admitted that the only statutes not covered in the EWSAA under his interpretation are the one at issue in the case, and the sale of military hardware to Iraq.

And Justice Ginsburg expressed concern that, if the Court holds for the respondents, any country would be able to sue the United States in their courts.

Goldstein finished by arguing that it would make no sense for Congress to have intended to give Iraq permanent immunity, as the EWSAA under petitioner’s view grants the President the authority to exempt Iraq from immunity, but not the power to rescind that exemption.

Franklin began his rebuttal responding to the charge that Iraq’s state-sponsored terrorism waiver would be permanent, and asserted that the United States may at a later point reinstate the ability to sue Iraq. He also argued that Congress knew how to make exception to the President’s authority in EWSAA, and did so explicitly with military hardware in Proviso 3. That it chose not to make such an exemption for sovereign immunity is proof that the President should therefore acted with authority in making 1605(a)(7) inapplicable to Iraq.