Terrorism Victims Ask Court to Block Release of Iran Assets

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Victims of Iranian terrorism and their family members asked a federal judge to block the U.S. government from unfreezing as much as $150 billion in assets as part of a nuclear deal with the Islamic Republic.

The victims and their relatives said in a lawsuit filed Wednesday in Manhattan federal court that the return of the assets will undermine a U.S. policy that allowed them to enforce judgments against the frozen holdings.

The U.S. Treasury and State departments “have a duty to these plaintiffs not to let these billions of dollars in escrow funds disappear,” according to the complaint.

A State Department spokeswoman said there’s no connection between sanctions relief Iran would receive and any court judgments. The funds that would be released as part of the nuclear deal are primarily from Iran’s oil sales that have been deposited into restricted accounts, Pooja Jhunjhunwala said in a statement.

“The U.S. does not hold or control any of this money,” she said. “We continue to work with Congress, the Department of Justice and others to explore ways to compensate victims of Iran’s past activities, including its support for terrorism.”

Whitney Smith, a Treasury Department spokeswoman, didn’t immediately respond to an e-mail after regular business hours seeking comment on the lawsuit.

Iran’s agreement with the U.S. and five other world powers announced last month in Vienna eases crippling economic sanctions on that nation in return for verifiable limits on its nuclear program.

The case is Leibovitch v. U.S. Department of State, 15-cv-06133, U.S. District Court, Southern District of New York (Manhattan).

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