Terrorism Victims Set Precedent
     
By Bill Miller
Washington Post Staff Writer
Sunday, October 22, 2000; Page A01 

Terrorism Victims and Families, Long Road to End in Payoff When former hostage Terry Anderson filed suit last year against the government of Iran seeking damages for his 2,454 days of captivity, he acknowledged that his effort was a symbolic, if not quixotic, attempt to strike back at the nation that had supported his abductors. 

"When I first filed the suit, it had more to do with what I thought would be just than with whether I thought I would win," said Anderson, who wanted to demonstrate in a U.S. courtroom that Iran was behind his 1985 kidnapping in war-torn Lebanon. "It's a long and complicated road."

That road is ending with an enormous payoff.

Within the next several months, Anderson and his family are scheduled to receive $41.2 million in compensatory damages, and former Lebanon hostages David P. Jacobsen, Joseph J. Cicippio and Frank H. Reed will receive $9 million, $30 million and $26 million respectively. The family of slain Marine Col. William R. Higgins will get $55.4 million.

More than $213 million--plus significant interest payments--will be distributed to eight families that have won judgments against Iran in a series of U.S. court cases. In a precedent-setting turn of events, the money is coming from the U.S. Treasury, with the U.S. government assuming responsibility for collecting on the claims from Iran.

The Clinton administration and Congress agreed to put up the money with the expectation that the United States can get it back either through an international claims tribunal or negotiations with Iran. As leverage, the U.S. government has more than $400 million in frozen Iranian assets--money the plaintiffs had wanted, but that the Clinton administration said it could not automatically turn over because it is tied up in litigation at The Hague.

Iran isn't the only country targeted in special legislation that aides say President Clinton will sign in the next few weeks. The families of Mario de la Pena, Armando Alejandre Jr. and Carlos Costa, whose Brothers to the Rescue planes were shot down by Cuba over the Florida straits in 1996, will receive $49.9 million in compensatory damages from frozen Cuban assets.

The payment arrangements took months to negotiate, with the Clinton administration trying to square the plaintiffs' right to justice with its concerns about diplomatic relations, national security and the prospect that other countries could file retaliatory lawsuits against the United States.

The action marks the first time that foreign countries will pay damages under a 1996 anti-terrorism law. Anderson and others said they believe the payments will make it easier for future plaintiffs to collect awards and may deter terrorists.

"What did it cost them to do these things, a few million dollars?" asked Anderson, who was an Associated Press correspondent in Beirut when he was abducted. "Well, now it's going to cost them $300 million. The next time they launch an attack against civilians, they should think--but they probably won't--how much this is going to cost them in court."

Cuban and Iranian officials criticized the legislation, arguing that the United States has no right to their governments' money. An editorial published last week in Granma, the Cuban Communist Party newspaper, said the action by Congress encourages "piratical attacks on our country."

An official at the Iranian mission of the United Nations said Iran holds the position that it will not recognize judgments returned by U.S. courts.

Several more cases are working their way through the federal courts, and others are in the planning stages, though the frozen Iranian money may run out before all earn damages. The lawsuits include one against Libya, filed on behalf of the victims of the 1988 bombing of Pan Am Flight 103.

The United States has previously found itself on the other side in court, though it was not accused of terrorism. In 1996, the government agreed to pay $61.8 million to the families of 248 Iranians killed when a U.S. warship mistakenly downed an Iranian jetliner in the Persian Gulf in 1988.

The federal lawsuits against Iran, Cuba and Libya were filed under a 1996 law that permitted U.S. citizens who are victims of terrorist acts abroad to sue foreign countries for civil damages in U.S. courts if those countries have been classified by the State Department as sponsors of terrorism.

Iran, Cuba and Libya have been on that list for years, along with Iraq, North Korea, Sudan and Syria. The United States holds $2.7 billion in frozen assets belonging to those countries.

Stephen M. Flatow, a New Jersey lawyer, was among the first to sue after his 20-year-old daughter, Alisa, was killed in 1995 by a suicide bomber as she rode a bus in the Gaza Strip. Flatow contended that the Palestinian extremist group Islamic Jihad was responsible for the attack and was funded primarily by Iran.

When he filed suit, Flatow said, "I felt we would never see a nickel, but we would make a point." Now that he is about to receive payment, he said, "I am the most surprised person on the face of this Earth."

Prevailing in the U.S. courts was relatively easy. Iran and Cuba didn't defend themselves, and judges found compelling evidence that they were behind the attacks. But neither country recognized the courts' authority, and the Clinton administration initially declined to turn over frozen assets.

Administration officials said they wanted to help but maintained that much of the Iranian money was tied up in litigation before the Iran-U.S. Claims Tribunal under an agreement that led to the 1981 release of U.S. Embassy employees who were taken hostage in Tehran by Iranian militants.

The administration also said it was obligated to defend international treaties and respect diplomatic property. That was why, for example, it resisted Flatow's attempt to take the Iranian Embassy here, which was seized by the United States during the hostage crisis.

In 1998, Congress passed legislation calling for the use of frozen assets to pay judgments, but the Clinton administration balked, citing national security and diplomatic concerns. Among other things, officials viewed frozen assets as a useful foreign policy tool and were reluctant to give them up.

After an emotional struggle between the families and the administration, the families won broad support from leaders on Capitol Hill, with key assistance from Rep. Bill McCollum (R-Fla.), Sen. Connie Mack (R-Fla.) and Sen. Frank R. Lautenberg (D-N.J.). The three reached the compromise with the administration and crafted the bill that was passed this month.

The compromise provides for swift, guaranteed payments for compensatory damages, sanctions and interest to the 11 families and others with pending cases against Iran.

The U.S. government will use frozen Cuban assets to pay claims to the families of the pilots from Brothers to the Rescue, an anti-Castro group that aided refugees fleeing the island. The United States has more than $150 million in frozen Cuban money, enough to pay the $49.9 million in compensatory damages and an additional $35 million in sanctions awarded to the families. The sanctions issue is still before the courts, however. Officials said the United States had no international obligations involving the Cuban money.

By contrast, the United States will pay nearly all the judgments against Iran from the U.S. Treasury, then will seek to recoup the funds from the frozen accounts through the Claims Tribunal or future negotiations with Iran.

The law caps the total damages against Iran at about $400 million, the amount that is in an account kept by the Pentagon for more than 20 years, when the United States sold military planes and parts to Shah Mohammed Reza Pahlavi.

Even if Iran prevails at the tribunal, the United States will argue that it first must reimburse the U.S. Treasury for the cost of the court judgments, administration officials said. The bill also requires the United States to press for recovery of the money as part of any talks about resuming relations with Iran.

The legislation makes no provision for the victims to receive hundreds of millions in punitive damages--which many won in court--and commits the government to help future plaintiffs recover whatever they can, unless that effort collides with national security interests.

"These families deserve some relief, and we are pleased that we were able to work with Senators Mack and Lautenberg to get it to them," said Deputy Treasury Secretary Stuart E. Eizenstat, who handled much of the negotiations. "This legislation allows compensation to be made while preserving the president's ability to waive, in the interest of national security, provisions of the legislation."

Anderson, 52, who was among 18 Americans taken hostage in Lebanon during the 1980s, said he believes a message has been sent to Iran and Cuba. Anderson was held captive the longest, from March 1985 until December 1991.

Now a journalism professor at Ohio University, Anderson said he wanted to show in court that although his assailants were from the militant group Hezbollah, they received money, training and direction from Iran. Getting rich on damages was not the point, he said. Deterring terrorism was the goal.

That view was echoed by retired Marine Lt. Col. Robin L. Higgins, whose husband was taken captive in 1988 and killed 18 months later while on a U.N. peacekeeping mission in Lebanon. A videotape of his body--hanging by the neck--was one of the most gruesome images of the Lebanese civil war.

"It's important that those of us who have been tragically affected by terrorism do what we can under the laws of this country to pursue justice," Higgins said. "My personal goal has never been to get rich or make money."

David Jacobsen, who was a hospital administrator when he was taken captive in Lebanon, said that he never doubted that he would succeed. He and the other former hostages had been through more trying ordeals and would never give up, Jacobsen explained.

"We are a tenacious group," said Jacobsen, 69. "We yelled and screamed at the top of our lungs for justice until we were heard."

© 2000 The Washington Post Company