The Islamic Republic is no stranger to US sanctions imposed on its economy and military apparatus. But can one sue Tehran’s clerical leaders and other international state sponsors of terrorism in a US court?
The answer is yes, although you’re unlikely to see a defense attorney representing Ayatollah Khamenei showing up in court.
On July 1, the Anti-Defamation League (ADL), together with law firm Crowell & Moring, brought forth a law-suit against in a US court against a trio of nations they claim are responsible for terrorism.
The landmark lawsuit, filed in federal court in Washington, DC, on behalf of more than 125 American survivors of the Hamas-led massacre in Israel on Oct. 7, holds the Islamic Republic, Syria and North Korea responsible for providing financial, military and strategic support to Hamas before the atrocities. The ADL and lawyers are demanding $4 billion in compensatory and punitive damages for the victims and their families.
“Iran is the world’s leading state sponsor of antisemitism and terror, along with Syria and North Korea . . . they must be held responsible for their roles in the largest antisemitic attack since the Holocaust,” said ADL CEO Jonathan Greenblatt, when announcing the suit.
The 117-page complaint alleges that Tehran funded and trained terror groups in Gaza, including Hamas and Palestinian Islamic Jihad. Less than a month after the Oct. 7 attacks, US Rep. Bill Huizenga (R-Mich.), who chairs the House Financial Services Subcommittee on Oversight and Investigations, noted that Hamas receives approximately $350 million annually, or 93% of its total annual budget, in support from Tehran.
James Pasch, ADL’s senior director of national litigation, told The Postthat while he doesn’t expect a response from Iran, Syria or North Korea, there’s clear precedent in the US for a case like this to proceed — if not succeed. “US courts . . . have repeatedly held foreign terrorists supporting nation states responsible for terrorist attacks that caused the death and injury of American citizens,” Pasch said.
Law firm Crowell & Moring, which filed the lawsuit jointly with the ADL, has a long history of successfully prosecuting terrorism cases. Such cases include the Libyan terrorist bombing of UTA flight 772 in 1989, where 170 passengers and crew, including seven Americans, were killed, as well as deadly attacks on US embassies in Beirut and Nairobi in 1983 and 1998, respectively, resulting in favorable judgements for victims totaling some $18 billion.
Aryeh Portnoy, partner and co-chair of Crowell’s terrorism litigation practice, told The Post that the Oct. 7 case “presents an opportunity for American victims . . . to tell their truth in a court of law, and to have the opportunity for the court to decide whether they have been wronged, who should be held accountable, and whether they are entitled to some remedy for their suffering.”
“While nothing will ever undo the unbearable pain Hamas caused our family or the brutal losses we’ve suffered, we hope this case will bring some sense of justice,” said plaintiff Nahar Neta, whose mother, California native Adrienne Neta, was murdered by Hamas in Kibbutz Be’eri last October. “My mom,” Nahar added, “devoted her life to caring for others regardless of race or religious beliefs.”
Had Iran, Syria and North Korea not supported Hamas, the lawsuit contends, an attack on the scale of Oct. 7 — where 1,200 people were massacred and more than 250 were kidnapped — couldn’t have taken place.
As for Syria, the complaint alleges that the Assad regime has long been a haven for leaders of Palestinian terrorism, and that Hamas regularly routes “weapons shipments originating from Iran through Syria and from there to Gaza.”
Meanwhile, North Korea is accused of having “provided specific assistance to Iran’s proxies in connection with the design and construction of underground tunnel networks used in attacks in Israel.”
Very rarely do countries accused of state-sponsored terrorism acknowledge lawsuits in the US, but if those nations are found guilty, the plaintiffs would likely be granted compensation disbursed through the US Victims of State Sponsored Terrorism (USVSST) Fund. Set up in 2015, the fund compensates survivors and families of terror attacks perpetrated by recognized state sponsors of terrorism.
There are currently more than 18,000 eligible American claimants included in the fund, with almost two-thirds comprising survivors of the Sept. 11 attacks in 2001 and the rest victims of other terror attacks involving American citizens. Since its founding, the USVSST Fund has distributed more than $6 billion to victims of state sponsored terrorism.
The fund isn’t made up of tax dollars. Instead it is financed by monies seized by the Department of Justice in terror-related cases where companies and individuals were found guilty of illicitly transacting with state sponsors of terrorism, such as Iran, Cuba or North Korea.
The only issue is that the USVSST Fund is no longer working as intended, according to legal experts. Owing to Dept. of Justice staff shortages — and bureaucratic feet-dragging — seized funds and assets earmarked for American terror victims are not being fully funneled to the USVSST Fund, leaving survivors short-changed.
In 2023, for example, the world’s largest crypto exchange, Binance, was fined $4.3 billion for money laundering violations and sanctions violations involving Iran, but only $898 million was deposited into the USVSST Fund, according to DOJ records.
What had initially started as an efficient process for victims of terror to receive compensation has become bogged down in bureaucracy, and reforming this broken system has garnered bipartisan support.
Few people understand the importance of a properly-functioning victims’ fund like Stephen Flatow. His 20-year-old daughter and Brandeis University undergrad, Alisa Flatow, was murdered, alongside seven Israeli soldiers, in April 1995 after a Palestinian suicide bomber drove a van loaded with explosives into a public bus on a road to the Israeli town of Kfar Darom.
After discovering that Iran sponsored the Palestinian terrorists behind Alisa’s murder, Flatow, together with a team of lawyers, filed a lawsuit against the Islamic Republic in 1997. A year later, the district court judge presiding over the case ruled that the Iranian government had financially aided the Palestinian terrorist group and was therefore responsible for Alisa’s murder.
The court ordered the Islamic Republic to pay $250 million in damages to Alisa’s family, but State Department politics got in the way. “The State Department and DOJ claimed it was bad public policy,” Flatow said. “If we did that to Iran, they would” retaliate and seize US assets in return. Flatow added that the State Department under Bill Clinton and Barack Obama’s presidential administrations have appeared far more interested in reintegrating the Islamic Republic into the international community than seeking compensation for families like his own.
“Clinton made a good run [at negotiating with Tehran], but…it failed. Obama then released all this money to Iran in exchange for the nuclear deal, which flopped,” Flatow said. “We should recognize after 45 years that Iran has no interest in being welcomed back to the community of nations.”
Years went by until the Flatow family received any compensation — a much smaller settlement after Flatow and other victims’ families had relentlessly fought with the State Department and DOJ to pay them the compensation they had been attempting to collect from Iran.
Flatow told The Postthat he hopes the fund is fixed to help survivors and victims’ families overcome unimaginable suffering. “Losing a victim to terrorism is a brutal shock to the system,” he said. “The emotional recovery is certainly helped by a financial reward and the sooner families can receive their compensation, the faster they can get on the road to recovery.”
That’s why a group of Republican and Democratic House lawmakers introduced new legislation in May 2024 to replenish the USVSST Fund while guaranteeing regular annual payments to the approximately 18,000 U.S. victims included in the fund.
Angela Mistrulli was among those Americans grateful for the renewed efforts to fix the decade-old fund. Her father, Joseph, was a carpenter working at Windows of the World, the restaurant on the 107th floor of the World Trade Center’s North Tower and was killed on September 11, 2001 after hijacked planes struck both towers.
“This bill is going to take care of almost 20,000 victims of terrorism, and set up a place for victims of the future that they don’t have to go through the 20 years of struggling and fighting that we had to,” Mistrulli said at a recent press conference.
“Without a functioning USVSST Fund, victims will relive the worst moments of their lives [in court] but for no meaningful relief,” said Crowell partner Portnoy, who has represented hundreds of victims of state-sponsored terrorism. “The bipartisan legislation introduced [ensures] . . . that the specific funds identified to help these victims’ recovery actually reaches them as the law requires.”
Experts expect the Oct. 7 lawsuit to last up to two years as it makes its way through diplomatic channels and all of the plaintiffs’ painful testimony. With the atrocities of last October well documented — and Hamas’ ties to the Islamic Republic, Syria and North Korea robust — a favorable outcome for the American victims is likely. But whether the USVSST Fund is reformed to help survivors get their lives back together remains to be seen.
Still, however the case turns out, it is a very public step toward securing justice — and, perhaps, preventing terror attacks in the future.
Jonathan Harounoff is the author of the forthcoming book “Unveiled: Inside Iran’s #WomenLifeFreedom Revolt.”
