In the United States Court of Federal Claims
                                       No. 14-687C

                                   (Filed: July 7, 2016)

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                                      *
AVIATION & GENERAL INSURANCE          *
COMPANY, LTD., et. al.,               *             Fifth Amendment Taking Claim;
                                      *             President’s Termination of Lawsuits
                    Plaintiffs,       *             Against Libya; Foreign Claims
                                      *             Settlement Commission; Penn Central
v.                                    *             Factors; Analysis of Investment
                                      *             Backed Expectations and Economic
THE UNITED STATES,                    *             Impact; Summary Judgment Based
                                      *             Upon Stipulated Facts.
                    Defendant.        *
                                      *
************************************* *

Steven R. Perles, Edward B. MacAllister, and Joshua K. Perles, Perles Law Firm, PC,
Washington, D.C., for Plaintiffs.

L. Misha Preheim, with whom were Joyce R. Branda, Acting Assistant Attorney General,
Robert E. Kirschman, Jr., Director, and Reginald T. Blades, Jr., Assistant Director,
Commercial Litigation Branch, Civil Division, U.S. Department of Justice, Washington,
D.C., for Defendant.

                         OPINION AND ORDER ON
                  CROSS-MOTIONS FOR SUMMARY JUDGMENT

WHEELER, Judge.

       This case presents novel Fifth Amendment taking claims arising from the
Government of Libya’s terrorist attacks in bombing Pan Am Flight 103 over Lockerbie,
Scotland in 1988, and in hijacking EgyptAir Flight 648 in 1985. Plaintiffs assert that they
had valid causes of action against Libya pending in the U.S. District Court for the District
of Columbia, but that President George W. Bush extinguished those actions by restoring
sovereign immunity to Libya in 2008. In so doing, President Bush issued an Executive
Order terminating the lawsuits against Libya and referring the disputes to the Foreign
Claims Settlement Commission. However, the Settlement Commission ruled that it lacked
jurisdiction over Plaintiffs’ claims, leaving Plaintiffs with no avenue for recovery.
Plaintiffs’ taking claims followed in this Court. For the reasons explained below, the Court
denies Plaintiffs’ claims.

                                    Factual Background

        In its May 26, 2016 opinion and order denying the Government’s motion to dismiss,
the Court provided a detailed description of the factual bases for Plaintiffs’ claims. See
Aviation & Gen. Ins. Co. Ltd. v. United States, 

(2015). As relevant to
the parties’ cross-motions for summary judgment, the Court includes a brief recitation of
the facts. On November 23, 1985 and December 21, 1988, Libyan-sponsored terrorists
hijacked EgyptAir Flight 648 and bombed Pan Am Flight 103, respectively. Plaintiffs are
insurance companies and an asset management company that insured in part both aircrafts.
Joint Statement of Material Facts (“JSMF”) ¶¶ 1, 2. All but one Plaintiff is a foreign
corporation. JSMF ¶ 2. As a result of the attacks, Plaintiffs paid approximately $64 million
to their insureds for both aircrafts. JSMF ¶¶ 5, 7, 9.

        At the time of the terrorist attacks, as now, Plaintiffs could not bring claims against
Libya. The Foreign Sovereign Immunities Act of 1976 prohibits suits against other
countries in U.S. courts, with certain exceptions. See 28 U.S.C. § 1604 (immunity for
foreign states); §§ 1605-1607 (providing exceptions). One exception, now repealed,
stripped a foreign state of immunity in any suit arising from certain acts of terrorism that
occurred when the state was designated a sponsor of terrorism. See 28 U.S.C. § 1605(a)(7).
On January 28, 2008, Congress amended the Act and designated Libya a sponsor of
terrorism. JSMF ¶¶ 17-18; 28 U.S.C. §1605(A). Then, Plaintiffs filed two separate
lawsuits seeking indemnification for their payments to victims of the attacks on Pan Am
Flight 103 and EgyptAir Flight 648. JSMF ¶¶ 14-15.

       In August 2008, while Plaintiffs’ lawsuits were pending in U.S. District Court,
Congress passed the Libyan Claims Resolution Act, Pub. L. No. 110-301, 122 Stat. 2999
(2008), restoring Libya’s sovereign immunity and implementing a Claims Settlement
Agreement between the United States and Libya. JSMF ¶¶ 20-21, 28; Claims Settlement
Agreement Between the United States of America and the Great Socialist People’s Libyan
Arab Jamahiriya, 2008 U.S.T. Lexis 72, entered into force Aug. 14, 2008. In exchange,
Libya paid the U.S. Government $1.5 billion to ensure payment to specified terrorism
victims with claims against Libya. JSMF at A185.

       On October 31, 2008, President George W. Bush issued Executive Order No. 13,477
providing that any pending suit in any U.S. court by United States or foreign nationals
related to Libyan-sponsored terrorism shall be terminated. JSMF ¶¶ 23, 25-27. The U.S.

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District Court dismissed Plaintiffs’ lawsuits for lack of subject matter jurisdiction. JSMF
¶ 27. Pursuant to Executive Order No. 13,477 and to compensate victims, the State
Department referred U.S. nationals’ claims against Libya to the Foreign Claims Settlement
Commission that was funded by the $1.5 billion payment from Libya. JSMF ¶ 34.
Importantly, Executive Order No. 13,477 does not direct the State Department to refer
claims by foreign companies to the Foreign Claims Settlement Commission. Nevertheless,
in 2010, certain Plaintiffs brought claims before the Settlement Commission. They claimed
to “stand in the shoes” of victimized U.S. nationals and to be entitled to compensation
through the Foreign Claims Settlement Commission. JSMF ¶¶ 37, 42. Disagreeing, the
Settlement Commission dismissed Plaintiffs’ claims for lack of jurisdiction. JSMF ¶¶ 39,
43. The Settlement Commission’s dismissal is the impetus for Plaintiffs’ claims before
this Court.

        On July 31, 2014, Plaintiffs filed suit in this Court alleging takings of their legal
claims against Libya without just compensation in violation of the Fifth Amendment. On
December 7, 2015, the Government filed a motion for summary judgment, and Plaintiffs
filed a cross-motion for summary judgment on January 15, 2016. On June 16, 2016, the
Court heard oral argument. The matter is fully briefed, and both motions are ready for
decision. For the reasons set forth below, the Court grants the Government’s motion for
summary judgment.

                                         Discussion

        Summary judgment is appropriate when the evidence indicates that there is “no
genuine dispute as to any material fact and that the movant is entitled to judgment as a
matter of law.” RCFC 56(c); Anderson v. Liberty Lobby, Inc. 

, 247-48
(1986). A “genuine” dispute is one that “may reasonably be resolved in favor of either
party,” and a fact is “material” if it might significantly alter the outcome of the case under
the governing law. 

, 250. In determining the propriety of
summary judgment, a court will not make credibility determinations, and will draw all
inferences in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co.
v. Zenith Radio Corp., 

, 587-88 (1986). Here, the parties agree to all material
facts, and therefore disposition of the case on summary judgment is appropriate. See, e.g.,
Hr’g Tr., June 16, 2016 at 23-24, Dkt. No. 58.

       To state a claim for a taking under the Fifth Amendment’s just compensation clause,
the plaintiff must establish that it was the owner of property and that the United States took
the property for a public purpose. Acceptance Ins. Cos., Inc. v. United States, 

, 854 (Fed. Cir. 2009); Shanghai Power Co. v. United States, 

, 239-40
(1983). In its opinion denying the Government’s motion to dismiss, the Court recognized,

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as a matter of law, Plaintiffs’ property interest in the insurance contracts they sought to
protect with a legal claim against Libya. Aviation & Gen. Ins. 

.
The Government invites the Court to reconsider its holding. However, the Government
fails to present new precedent or a new factual basis that would call into question the
Court’s prior decision. The Court declines the Government’s invitation. For the reasons
explained in the Court’s May 26, 2015 opinion, Plaintiffs have a cognizable property
interest.

        Next, the Court must determine if there was a taking for which the Plaintiffs are
entitled to compensation. The “Fifth Amendment’s guarantee . . . [is] designed to bar the
Government from forcing some people alone to bear public burdens which, in all fairness
and justice, should be borne by the public as a whole.” Armstrong v. United States, 

, 49 (1960). However, the Courts have been unable to develop any set formula for
determining when justice and fairness require that economic injuries caused by public
action be compensated by the government. Penn Central Transp. Co. v. New York City,

, 124 (1978). Whether there has been a taking depends largely upon the
particular circumstances in each case. 

source). In other words, the
Court must weigh all relevant factors to determine whether Plaintiffs’ loss is one that in all
fairness and justice ought to be shifted to the public rather than be shouldered by Plaintiffs
alone. Belk et al. v. United States, 

, 709 (Fed. Cir. 1988) (quoting another
source).

       “Since the reemergence of Fifth Amendment takings law from its long
Twentieth-century slumber, takings claims have come in a variety of forms arising from a
variety of fact patterns, some of which fit less than comfortably in to the regulatory or
physical takings dichotomy.” Abrahim-Youri et al. v. United States, 

, 1466
(Fed. Cir. 1997) (citing another source). The Court agrees with the parties that while the
facts of this case do not neatly fit those of a traditional regulatory taking, the principal
factors in a regulatory takings analysis apply: the character of the governmental action; the
extent to which the regulation has interfered with distinct investment-backed expectations;
and the economic impact of the regulation on the plaintiff. Penn 

;
see 

(treating a takings claim based on espousal as a
regulatory taking).

       Plaintiffs cannot claim an investment-backed expectation free of government
involvement nor can they characterize the Government’s action as novel or unexpected.
Where plaintiffs could have reasonably expected their property interests to be adversely
affected by Government action, the commitment of private resources to the creation of
property interests is deemed to have been undertaken with that risk in mind. In such
circumstances, the call for just compensation on grounds of fairness and justice is
considerably diminished. See, e.g., Abrahim-Youri et al. v. United States, 

,

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486 (1996) (collecting cases) aff’d, Abrahim-Youri, 

(Fed. Cir. 1997). This
is the case here.

        “[T]hose who engage in international commerce must be aware that international
relationships sometimes become strained, and that governments engage in a variety of
activities designed to maintain a degree of international amity.” 

. Businesses, such as Plaintiffs, that engage in international commerce are fully
aware that the security of their enterprise is uniquely dependent on the maintenance of
stability and good order in the relationships among nations. See, e.g., 

here,
the relations between countries become strained, the possibility that the President will
intervene is properly recognized as both a shared benefit and a shared risk of those who
trade abroad. Shanghai 

. Our Presidents have exercised the power
to settle international claims filed in U.S. courts since at least 1799. See Dames & Moore
v. Regan, 

, 679 (1981). Thus, the President’s involvement in settling claims
against Libya and setting up the Settlement Commission cannot constitute a novel
interference with any investment-backed expectation.

       Instead, Plaintiffs assert they had an investment-backed expectation to bring suit
against and recover from Libya after Congress briefly lifted Libya’s sovereign immunity.
However, by providing that the State Sponsor of Terrorism exception no longer applies,
the United States merely restored the default rule of sovereign immunity. Foreign
sovereign immunity “reflects current political realities and relationships” and its
availability, or lack thereof, “generally is not something on which parties can rely in
shaping their primary conduct.” Republic of Iraq v. Beaty, 

, 864-65 (2009)
(quoting Republic of Austria v. Altmann, 

, 696 (2004)) (internal quotation
marks omitted). In affairs between nations, outstanding claims filed in one nation against
the government of another country are “sources of friction” between the two sovereigns.
United States v. Pink, 

, 225 (1942). While individuals may have legitimate
claims against foreign nations, the presence of these claims and attempts to collect may
seriously harm the relations between the two countries. Shanghai 

.
The President’s power to eliminate sources of friction between sovereigns is a
long-standing and integral aspect of the President’s authority to conduct foreign relations.
See, e.g., 

       The last factor the Court must consider is the economic impact of the Government’s
actions. Undoubtedly, the Government extinguished Plaintiffs’ claims without providing
an alternative forum in which Plaintiffs could bring their claims. However, the mere fact
that Executive Order No. 13,477 did not provide any alternative forum in which Plaintiffs
could assert their claims, is not sufficient to establish a taking. 

.
Plaintiffs’ only remaining challenge is to the Government excluding Plaintiffs from the
Settlement Commission’s jurisdiction. To be sure, the Government has no constitutional

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obligation to act as a collection agent on Plaintiffs’ behalf. Shanghai 

; accord 

. Further, the parties do not request and indeed agree this
Court lacks jurisdiction to review the Settlement Commission’s decision that it lacked
subject matter jurisdiction over Plaintiffs’ claims. See 22 U.S.C. § 1623(h) (describing the
finality of Commission decisions).

        Finally, the Court is concerned that the value of Plaintiffs’ loss of its causes of action
does not have a definite value and thus is speculative. While the Court assumes, without
deciding, that Plaintiffs plausibly could have pursued a claim against Libya to final
judgment, it is skeptical that Plaintiffs would have been able to collect on the judgment.
See, e.g., Sperry v. United States, 

, 53 (1989) (“Had the President not agreed
to the establishment of the [Iran-U.S. Claims] Tribunal and the Security Account,
[Plaintiff] would have had no assurance that it could have pursued its action against Iran to
judgment or that a judgment would have been readily collectable.”); accord In re Islamic
Republic of Iran Terrorism Litig., 

, 49 (D.D.C. 2009) (“A number of
practical, legal and political obstacles have made it all but impossible for plaintiffs in these
[Foreign Sovereign Immunities Act] terrorism cases to enforce their default
judgments. . . .”). Given these considerations, the Plaintiffs’ economic injury is not one
that fairness and justice require be shifted to the public at large.

                                          Conclusion

       For the foregoing reasons, the Court GRANTS Defendant’s motion for summary
judgment, and DENIES the Plaintiffs’ motion for summary judgment. The Court directs
the Clerk of Court to enter judgment for the Defendant. No costs.

       IT IS SO ORDERED.

                                                    s/Thomas C. Wheeler____
                                                    THOMAS C. WHEELER
                                                    Judge




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