Hegna, et al v. Islamic Repub Iran, et al

United States Court of Appeals
Fifth Circuit
F I L E D
July 19, 2004
Charles R. Fulbruge III
Clerk
In the
United States Court of Appeals
for the Fifth Circuit
_______________
m 03-10994
m 03-20984
_______________
EDWENA HEGNA; INDIVIDUALLY AND AS EXECUTRIX OF
THE ESTATE OF CHARLES HEGNA; CRAIG HEGNA; STEVEN HEGNA;
LYNN HEGNA; PAUL HEGNA,
Plaintiffs-Appellants,
VERSUS
ISLAMIC REPUBLIC OF IRAN;
IRANIAN MINISTRY OF INFORMATION AND SECURITY,
Defendants-Appellees,
UNITED STATES OF AMERICA
Movant-Appellee.
_________________________
Appeals from the United States District Court
for the Northern District of Texas
and the United States District Court
for the Southern District of Texas
_________________________

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2
Before SMITH, PRADO, AND PICKERING,
Circuit Judges.
JERRY E. SMITH, Circuit Judge:
Charles Hegna died at the hands of
terrorists who received partial support from
the Islamic Republic of Iran. Members of the
Hegna family have attempted to collect a
default judgment against property previously
owned by Iran and currently held by the Unit-
ed States. Based on domestic statutes and
international treaties, the two district courts a
quo quashed writs of attachment and
execution issued respectively against two
parcels of real property. Finding no error, we
affirm both judgments.
I.
A.
The Federal Sovereign Immunities Act
(“FSIA”) articulates the general rule that “a
foreign state shall be immune from the
jurisdiction of the courts of the United States
and of the States.” 28 U.S.C. § 1604. As part
of the 1996 Antiterrorism and Effective Death
Penalty Act (“AEDPA”), Congress created an
exception for state-sponsored terrorist actions.
28 U.S.C. § 1605(a)(7).1 To be subject to
§ 1605(a)(7), a nation must be designated as a
state sponsor of terrorism. § 1605(a)(7)(A).2
The Victims of Trafficking and Violence
Protection Act of 2000 (“VTVPA”), Pub. L.
No. 106-386, § 2002, 114 Stat. 1464, 1541
(2000), created a regime whereby a party who
secured a judgment under § 1605(a)(7) could
receive payment from the Secretary of the
Treasury. In exchange for that payment, the
recipient would relinquish certain rights to col-
lect against the terrorist state.3
The Terrorism Risk Insurance Act
(“TRIA”), Pub. L. No. 107-297, § 201(a), 116
Stat. 2322 (2002), provided additional rights
to parties possessing judgments under § 1605-
(a)(7). TRIA states that a successful plaintiff
may attach and execute against the “blocked
assets”4 of terrorist parties.5
Additionally, TRIA § 201(c)(4) amends the
VTVPA by inserting a section describing the
procedures the government must follow in the
event available funds cannot satisfy all the
outstanding requests for payment for § 1605-
(a)(7) claims. Although those receiving partial
payments do not have to relinquish as many
1 “A foreign state shall not be immune . . . in
any case . . . in which money damages are sought
against a foreign state for personal injury or death
that was caused by an act of torture, extrajudicial
killing, aircraft sabotage, hostage taking, or the
provision of material support or resources” in aid
of a terrorist action. 28 U.S.C. § 1605(a)(7).
2 The Secretary of State has designated Iran as
a state sponsor of terrorism. 49 Fed. Reg. 2836-02
(Jan. 23, 1984).
3 Additionally, VTVPA § 2002(b)(2) lists the
sources of funding for payments arising out of
judgments against Iran: “rental proceeds . . . from
Iranian diplomatic and consular property located in
the United States; and . . . funds not otherwise
made available in an amount not to exceed the total
of the amount in the Iran Foreign Military Sales
Program account within the Foreign Military Sales
Fund[.]”
4 TRIA § 201(d)(2) defines “blocked asset.”
5 “[I]n every case in which a person has ob-
tained a judgment against a terrorist party on a
claim based upon an act of terrorism[,] the blocked
assets of that terrorist party . . . shall be subject to
execution or attachment in aid of execution in order
to satisfy such judgment . . . .” TRIA § 201(a).

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3
rights as they would have forfeited had they
received full payment via the VTVPA, the
recipients must give up some recovery rights.
VTVPA § 2002(a)(2)(C) requires the
relinquishment of punitive damages against a
terrorist entity, and § 2002(a)(2)(D) prevents
parties from executing or attaching property
“that is[, inter alia,] at issue in claims against
the United States before an international
tribunal[.]”
Thus, in response to a family member’s
death, a party may seek a judgment against a
state sponsor of terrorism. The party may sat-
isfy such a judgment by seeking and receiving
payment under the VTVPA and by attaching
and enforcing against “blocked assets”
pursuant to the TRIA.
B.
In 1984, Hezbollah terrorists hijacked a Ku-
waiti airliner and diverted it to Tehran, fatally
shooting Charles Hegna in the process. In
2001, the Hegna family sought and obtained,
pursuant to 28 U.S.C. § 1605(a)(7),6 a default
judgment for $42,000,000 in compensatory
damages and $333,000,000 in punitive
damages against the Islamic Republic of Iran
and the Iranian Ministry of Information and
Security.7
Relying upon TRIA § 201(a), the Hegnas
have attempted to attach and execute against
numerous properties that Iran owned at the
time of the 1979 hostage crisis.8 Specifically,
6 Few courts of appeals have considered the
application of § 1605(a)(7). But see Acree v. Re-
public of Iraq, 2004 U.S. App. LEXIS 10972
(D.C. Cir. June 4, 2004) (vacating a § 1605(a)(7)
award for failing to state a claim); Cicippio-Puleo
v. Islamic Republic of Iran, 353 F.3d 1024 (D.C.
Cir. 2004). Cicippio-Puleo held:
[N]either 28 U.S.C. § 1605(a)(7) nor the
Flatow Amendment[, which granted punitive
damages pursuant to § 1605(a)(7)], nor the
two considered in tandem, creates a private
right of action against a foreign government.
Section 1605(a)(7) merely waives the
immunity of a foreign state without creating
a cause of action against it, and the Flatow
Amendment only provides a private right of
(continued...)
6(...continued)
action against officials, employees, and
agents of a foreign state, not against the
foreign state itself.
Id. at 1033.
Although Acree and Cipio considered statutes
at issue in the current appeal, they involved
different circumstances and issues. Both cases
considered the validity of the underlying judgment.
In the instant matter, neither party contests the
validity of the Hegna family’s original judgment.
Because neither side has briefed the issue or had an
opportunity to argue the point diligently, we choose
only to address the family’s ability to satisfy its
judgment against these two particular pieces of
property. If the United States wishes to argue the
reach of § 1605(a)(7), it may do so in a subsequent
case.
7 Hegna v. Islamic Republic of Iran, No.
1:00CV00716 (D.D.C. Feb. 7, 2002).
8 In the midst of the Iranian revolution of 1979,
numerous “students” aligned with Ayatollah Koh-
meini took Americans hostage in the American
Embassy. The President froze all property and
assets of the government of Iran that fell within or
would fall within the jurisdiction of the United
States. Exec. Order No. 12170, 44 Fed. Reg.
65729 (Nov. 14, 1979). The United States ulti-
mately severed diplomatic and consular relations
(continued...)

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they have pursued properties in New York,9
Illinois,10 Maryland,11 and Texas. Additionally,
they filed for a payment pursuant to the
VTVPA.12
Although the two countries promised, as
part of the Algiers Accords,13 to exchange
seized consular property, each has retained
previously-seized property. Consequently, the
United States acts as a custodian of the
property that the Hegnas have attempted to
attach, and, in every case, has moved to
invalidate the family’s actions.
In the instant matter, the family attached
two pieces of Iranian property located in Tex-
as. One, located in Lubbock, served as a
home from which the then-Crown Prince of
Iran could receive fighter pilot training.14 The
property located in Houston previously served
as the residence of the General Consul of
8(...continued)
with Iran. The hostage crisis ended with the sign-
ing of the Algiers Accords in January 1981.
9 Hegna v. Islamic Republic of Iran, 299 F.
Supp. 2d 229 (S.D.N.Y. 2004). The district court
denied the application for attachment based on the
conclusion that the Hegnas had relinquished the
right to attach the New York property after ac-
cepting payment via the VTVPA.
10 Hegna v. Islamic Republic of Iran, 2003
U.S. Dist. LEXIS 14039 (N.D. Ill. Aug. 11, 2003).
The magistrate judge recommended denying the
United States’ motion to quash the family’s writ of
attachment. The Illinois proceedings occurred after
the Hegnas had applied for payment pursuant to
VTVPA but before payment from the government.
Because the Hegnas sought to rescind their ap-
plication for payment, the magistrate judge rec-
ommended staying further proceedings until the
resolution of the VTVPA payment issue. As dis-
cussed, infra, the Hegnas received payments in
July and November 2003.
11 Hegna v. Islamic Republic of Iran, 287 F.
Supp. 2d 608 (D. Md. 2003). The district court
granted the United States’ motion to quash the fam-
ily’s writ after concluding that the property at issue
fell outside TRIA’s definition of “blocked asset.”
12 The Hegnas argue that the Department of the
Treasury issued guidelines that ordered plaintiffs
such as themselves to apply for the VTVPA funds.
Because the language of the VTVPA states that the
payment regime initiates only “at the person’s
election,” the family’s argument warrants slightly
more discussion. VTVPA, § 2002(a)(1).
We agree that the Treasury Guideline does not
stand as a model of clarity, directness, or help-
(continued...)
12(...continued)
fulness. The notice, however, contains ample lang-
uage to indicate that a party may file for a VTVPA
payment and does not indicate that a plaintiff may
pursue relief only through the VTVPA.
13 In part, the Accords established the Iran-Unit-
ed States Claims Tribunal, a nine-member
commission charged with resolving “claims of
United States nationals against Iran and of Iranian
nationals against the United States[;] certain ‘offi-
cial claims’ between the two Governments relating
to the purchase and sale of goods and services;
disputes between the two Governments concerning
the interpretation or performance of the Algiers
Declarations; and certain claims between United
States and Iranian banking institutions.” Iran-
United States Claims Tribunal Background
Information, available at http://www.iusct.org/-
background-english.html (accessed June 18, 2004).
14 The Crown Prince received training at Lub-
bock’s Reese Air Force Base, which was closed in
1997.

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5
Iran.15
With respect to the Lubbock property, the
district court granted a writ of attachment and
a motion for expedited levy of a writ of
execution16 and scheduled the sale of the
property for August 26, 2003. The United
States provided an initial VTVPA payment to
the Hegnas on July 30, 2003, and filed an
emergency motion to void the sale on August
22, 2003. Without providing a written
analysis, the district court granted the motion
to void the levy and the sale on August 25,
2003.
With respect to the Houston property, the
district court issued a writ of execution on No-
vember 27, 2002. After the United States
moved to quash the writ, the district court re-
ferred the matter to a m agistrate judge, who,
on August 21, 2003, concluded that the
property fell within an exclusion to the
“blocked asset ” definition in TRIA § 201(d)-
(2)(B)(ii) and recommended that the district
court quash the writ. The district court adopt-
ed the recommendations without amendment.
The Hegnas appeal the district courts’ failure
to enforce the original writs of attachment and
execution.
II.
In each case, the district court granted a
dispositive motion by terminating the relevant
writ. The respective cases, however, present
distinct questions of law. With respect to the
Houston property, we must determine whether
the property fits within the “blocked asset”
exclusion in TRIA § 201(d)(2)(B)(ii). With
respect to the Lubbock property, we must de-
cide exactly how a partial payment pursuant to
VTVPA and TRIA affects a party’s ability to
collect against non-consular property. We re-
view the district court’s legal analyses de no-
vo. Kennedy v. Tangipahoa Parish Library
Bd. of Control, 224 F.3d 359, 365 (5th Cir.
2000).
III.
By requesting and receiving partial payment
according to the terms of the VTVPA, the
Hegnas relinquished the ability to enforce
against the Lubbock property. The parties do
not disagree that the Hegnas applied for
payment from the Secretary of the Treasury,
pursuant to VTVPA § 2002(a)(1),17 and that
they received a partial payment before the sale
of the Lubbock property.
The Hegnas challenge the order to quash on
three grounds. First, they maintain that the
partial payment received on July 30 does not
trigger the relinquishment provisions of the
amended VTVPA. Second, they assert that
any relinquishment may occur only
prospectively and cannot apply to property
already attached and set for sale. Third, they
claim that any possible relinquishment does not
apply to the Lubbock property, because such
property is not “at issue” before an 15 Although the two properties are the subjects
of two separate actions and are located in different
federal judicial districts, we consolidated the
matters for argument and disposition. The cases
present similar questions regarding the same set of
statutes.
16 The United States unsuccessfully opposed the
Hegna family’s motion.
17 Because the Secretary of the Treasury could
not make a full payment and gave the family only
a partial payment, the amended portions of
VTVPA § 2002(d)(5)(A) and (d)(5)(B), apply.

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international tribunal.18 To affirm the quashing
of the writ of execution, we must agree with
the district court on all three matters.19
A.
The Hegnas’ acceptance of a partial
payment triggered the relinquishment
provisions of the VTVPA. Amended VTVPA
§ 2002(d)(5) states that
[a]ny perso n receiving less than the full
amount of compensatory damages awarded
to that party in a judgment . . . shall not be
required to make the [relinquishment set
forth in previous sections,] except that such
person shall be required to relinquish rights
set forth – (A) in subsection (a)(2)(C); and
(B) in subsection (a)(2)(D) with respect to
enforcement against property that is at is-
sue in claims against the United States be-
fore an international tribunal or that is the
subject of awards by such tribunal.
The phrase “such person” refers to the in-
dividual “receiving less than the full amount of
compensatory damages.” No other person is
referred to in that subsection. Thus, a party
receiving partial payment does not have to re-
linquish his rights to compensatory damages
but must give up those rights listed in the two
subsections. Subsection (a)(2)(C) concerns
punitive damages, and subsection (a)(2)(D)
addresses recovery against the “at issue”
properties.
The Hegnas would have us draw a line be-
tween a partial-partial paymentSSone that falls
below the statutorily-defined portion that the
government must paySSand a completely-paid
partial payment. In essence, the Hegnas con-
tend that they should have received more than
the government paid them and that the insuffi-
ciency of the amount allowed them to pursue
the sale of the Lubbock property.
That theory fails for two reasons. First, the
statute does not draw a distinction among
types of partial payments, but merely states
that “[a]ny person receiving less than the full
amount” will relinquish punitive and “at issue”
rights. The receipt of any partial
paymentSSeven $1SSwould limit the Hegnas’
recovery options.
Secondly, the government eventually paid
the Hegnas their full share of their
proportional payment. The second payment
occurred in November 2003. Thus, whatever
relinquishment provisions are contained within
the partial payment regime apply to the
Hegnas.
B.
18 Specifically, the Hegnas argue that “[u]ntil
the matter of the [Iran-United States Claims] Tri-
bunal’s subject matter jurisdiction over the Lub-
bock Property is determined, Iranian properties in
the United States, including the Lubbock Property,
are simply not property that is ‘at issue’ before the
Tribunal[.]”
19 Though the amended VTVPA requires a par-
ty to relinquish only its general claims for punitive
damagesSSVTVPA § 2002(a)(2)(C)SSit also man-
dates relinquishment of all claimsSSpunitive or
otherwiseSSagainst property “at issue in claims
against the United States.” § 2002(a)(2)(D). Be-
cause the amended VTVPA § 2002(d)(5) expressly
states that one receiving less than the full amount
of compensatory damages “shall not be required to
make the [relinquishment] set forth in subsection
(a)(2)(B) or with respect to subsection (a)(2)(D),”
a party may continue to pursue compensatory
awards. That party, however, may not pursue
those awards against “at issue” property. Thus, we
must address whether the Lubbock property is “at
issue.”

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7
Although receiving the VTVPA payment
causes them to relinquish “all rights” to
execute against designated property, the
Hegnas advance a creative but questionable
argument that they still may sell the Lubbock
property. Because payment did not arrive
until after the district court attached the
property and scheduled a sale, the Hegnas
maintain that the sale should proceed.20 Under
this theory, Texas law21 places the court’s levy
against the Lubbock property in custodia legis
and ties all sales proceedings to the date of
seizureSSnamely, July 2, 2003.22
The Hegnas support this interesting rift in
the space-time-continuum by citing a 1927
Fifth Circuit case23 that concerned bankruptcy
and an 1884 Supreme Court opinion24 that ad-
dressed competing judgment liens from
Tennessee. These cases do not remotely apply
to a situation resembling the instant case.25
The family’s interesting theory would re-
quire the sale to proceed regardless of the cor-
rectness of the attachment or the validity of the
sale. Courts would not have the ability to alter
their rulings in the event of a change in
circumstances. The situation, however, did
change once the United States made a partial
VTVPA payment to the Hegnas.
Because the family members already
applied for a payment from the government,
they should not argue with the government’s
attempts to hold them to the terms of the
payment. Receipt of the partial payment
forced them to relinquish “all rights to execute
against or attach property that is at issue in
claims . . . before an international tribunal[.]”
VTVPA § 2002(a)(2)(D) (emphasis added).
Assuming, arguendo, that the Hegnas’
argument has some validity and that the “right
. . . to execute” now lies strictly with the dis-
trict court, the court certainly possesses the
ability to revisit its ruling. A court may “re-
lieve a party or a party’s legal representative
from a final judgment, order, or proceeding”
for a variety of reasons, including the open-
20 The Hegnas contend that, “[s]ince the date of
actual sale relates back to the levy date, the date of
sale of the Lubbock Property is July 2, 200[3].”
21 The Hegnas cite the general rule that “[t]he
procedure on execution . . . shall be in accordance
with the practice and procedure of the state in
which the district court is held, existing at the time
the remedy is sought, except that any statute of the
United States governs to the extent that it is
applicable.” FED. R. CIV. P. 69(a).
22 The Hegnas assert that the train toward judi-
cial sale had proceeded past the point of no return:
“[W]hen the U.S. Marshal levied on the Lubbock
Property[,] the procedure for taking the property
into the custody of the District Court was complete
. . . . All that remained to be done was the judicial
sale, and V[TV]PA’s relinquishment provisions
have no application to post-levy sales.”
Additionally, the Hegnas suppose that they
should have the right to pursue sale to satisfy the
full value of their judgment against Iran. As shown
in part III.A., supra, however, even a partial
payment triggers the VTVPA’s full relinquishment
provisions.
23 Wilkinson v. Goree, 18 F.2d 455, 456-57
(5th Cir. 1927).
24 Freeman v. Dawson, 110 U.S. 264, 270
(1884).
25 Wilkinson relied on the workings of the for-
mer Bankruptcy Act and had no connection to en-
forcing judgments in Texas. Freeman has a sim-
ilarly non-existent connection.

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8
ended “any . . . reason justifying relief from the
operation of the judgment.” FED. R. CIV. P.
60(b). See also FED. R. CIV. P. 59(e)
(describing the period of time in which a party
must file a motion to alter or amend a
judgment).26
The Hegnas’ theory places form above
common sense and above the district court’s
ability to re-evaluate its ruling before the prop-
erty is sold. Thus, we turn to whether the
Lubbock property fits within the “at issue”
language of § 2002(a)(2)(D).
C.
Because the Lubbock property was “at is-
sue” in a claim before an international tribunal,
amended VTVPA § 2002(d)(5)(B) prevents
the Hegnas from executing on the property.
The United States asserts that the Lubbock
property is at issue in the Iran-United States
Claims Tribunal (“Claims Tribunal”). In
support, the government offers a declaration
from Mark Clodfelter, who lists himself as the
“Assistant Legal Adviser for, and director of
the office of, International Claims and
Investment Disputes in the Office of the Legal
Adviser of the Department of State.”
The Hegnas respond by contending (1) that
the property cannot be “at issue” until after a
court determines its jurisdiction over the prop-
erty; and (2) that the Claims Tribunal does not
have proper jurisdiction over the property.27
In support of their argument, the Hegnas offer
a definition from a 1979 edition of BLACK’S
LAW DICTIONARY and citations to two Florida
state court opinions. “At issue,” however, in-
cludes a broader swath of conflict than the
Hegnas assert. The most recent BLACK’S LAW
DICTIONARY (8th ed. 2004) defines “at issue”
as “[t]aking opposite sides; under dispute; in
question.” Although the United States has
contested the jurisdiction of the Iran-United
States Claims Tribunal over the properties,
both matters currently pend before that very
body. Even if the government ultimately pre-
vails, the Lubbock property will have remained
“at issue” before the tribunal during the instant
appeal.28
The only question with respect to the “at
issue” analysis concerns the evidence that the
government has offered. The aforementioned
declaration from Clodfelter vaguely but
coherently states his familiarity with the Claims
Tribunal and that the Lubbock property falls
within a list of properties “specifically
identified as the subject of the Tribunal case.”
Though Clodfelter’s declaration could have
included more specific information or
26 After the district court granted the motion to
void the sale, the Hegnas filed a FED. R. CIV. P.
59(e) motion.
27 In a related matter, the United States has as-
serted that consular property should fall under the
Vienna Convention on Consular Relations and
(continued...)
27(...continued)
should not be subject to the Claims Tribunal.
28 The Claims Tribunal has existed since July 1,
1981, and, as of December 31, 2003, has finalized
approximately 3,935 claims. Iran-United States
Claims Tribunal Background Information,
available at http://www.iusct.org/background-eng-
lish.html (accessed June 18, 2004); Iran-United
States Claims Tribunal Quarterly Communique of
Jan. 20, 2004, http://www.iusct.org-
/communique-english.pdf (accessed June 18,
2004). It apparently has not, however, addressed
the Lubbock property.

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9
documentary support,29 the Hegnas did not
deny the substance of the declaration in their
response, so they are foreclosed from
requesting a hearing to offer additional
evidence.
Consequently, the Hegna family’s
acceptance of partial payment triggered the
relinquishing provisions of the VTVPA.
Because the acceptance required the family to
relinquish all rights to attach and execute the
judgment, the Hegnas, through the court,
cannot sell the property. Finally, because the
Lubbock property currently stands at issue
before an international tribunal, VTVPA §
2002(a)(2)(D) and (c)(5)(B) prevent the
Hegnas from attaching or executing any
further judgments against that property.
IV.
The government argues that the VTVPA
payment bars the attachment and sale of the
Houston property in the same manner as for
the Lubbock property. In considering the
Houston property, however, the magistrate
judge expressly avoided the issues discussed in
the analysis of the Lubbock property.30
Before we may consider whether the
VTVPA blocks collection against the Houston
property, we must determine whether the
TRIA would allow the Hegnas to attach or ex-
ecute against the property in the first place. In
essence, we must make the same inquiry as did
the magistrate judge. Although we may affirm
for any reason the record supports,31 we
choose to follow the magistrate judge’s
analysis.
TRIA § 201(a) empowers an individual
who secures a judgment pursuant to 28 U.S.C.
§ 1605(a)(7) to attach and execute against
“blocked assets . . . to satisfy such judgment to
the extent of any compensatory damages.”
Section 201(d)(2) defines “blocked asset” in
such a way that it includes the Houston
property.32 Section 201(d)(2)(B)(ii), however,
exempts otherwise-attachable property from
the “blocked asset” category. To fall within
the exemption, the property must satisfy two
criteria.
First, the property must be “subject to the
Vienna Convention on . . . Consular
Relations[.]” TRIA § 201(d)(2)(B)(ii).
29 We wonder why the United States could not
have offered some documentation to support Clod-
felter’s declaration. Presumably, some formal doc-
ument exists to report the proceedings of the
Claims Tribunal. When a family’s ability to
satisfy a legitimate judgment depends on the status
of a piece of property, and when that status
requires evidence to make a determination, it is
preferable for the government to include more than
a declaration from one of its own employees.
30 “Having determined that Plaintiffs may not
execute against the [Houston] property, the court
need not reach the issue of whether Plaintiffs have
relinquished their right to execute on the judgment
(continued...)
30(...continued)
based on their acceptance of payment under the
VTVPA on July 30, 2003.”
31 LLEH, Inc. v. Wichita County, Tex., 289
F.3d 358, 364 (5th Cir. 2002).
32 “The term ‘blocked asset’ means– (A) any as-
set seized or frozen by the United States under
section 5(b) of the Trading With the Enemy Act
(50 U.S.C. App. 5(b)) or under sections 202 and
203 of the International Emergency Economic
Powers Act (50 U.S.C. 1701; 1702)[.]” The Pres-
ident froze Iranian property pursuant to the Inter-
national Emergency Economic Powers Act. See
supra note 8.

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10
Secondly, the property must be “used
exclusively for diplomatic or consular
purposes.” Id. Because we answer both
queries in the affirmative, the Houston
property does not qualify as a “blocked asset”
for purposes of TRIA § 201(a).
A.
As to the first matter, a consul’s residence
falls within the sweep of the Vienna
Convention on Consular Relations (“VCCR”),
April 24, 1963, 21 U.S.T. 77, 596 U.N.T.S.
8638. The signatories to the VCCR pledge
that, if one country severs consular relations
with another, the severing countries will “re-
spect and protect the consular premises,
together with the property of the consular post
and the consular archives” of one another.
VCCR, art. 27(1)(a).
The definition of “consular post” includes
“any consulate-general, consulate, vice-consul-
ate or consular agency.” VCCR, art. 1(1)(a).
A consulate typically includes a consul’s
residence, and no language in the treaty
deviates from this norm. BLACK’S LAW
DICTIONARY (8th ed. 2004) (defining
“consulate” as “the location of a consul’s
office or residence”).
Additionally, the United States has
interpreted the VCCR so as to include the
Houston property. Not surprisingly, this court
has not heretofore considered the VCCR.33
We note that the federal courts have long
been loathe [sic] to involve themselves in
matters of foreign policy, preferring to
leave such issues to the Executive Branch.
Therefore, we have always given
substantial weight to the interpretation of a
treaty by the government agency charged
with interpreting it.
More v. Intelcom Support Servs., Inc., 960
F.2d 466, 472 (5th Cir. 1992).
The United States, in its brief, “interprets
the reference to ‘property of the consular post’
in Article 27(1)(a) to include real property
such as the Consul General’s residence at issue
here.” Although the government certainly
could craft a self-serving or opportunistic in-
terpretation, the Hegnas have offered no evi-
dence to suggest such a motivation and have
not given a citation to a case or to a
compelling opposing argument.
Consequently, the language of the VCCR
and the government’s reasonable interpreation
of that language lead us to conclude that, un-
der the VCCR, the United States has an
obligation to “respect and protect” property
that served as the residence of the Iranian
General Consul. The Houston property is
within the ambit of the VCCR.34
B.
Although the government has rented the
Houston propert y to private parties and has
used some of those rental proceeds to satisfy
domestically-created obligations, it has used
33 The courts that have considered it largely
have done so in the context of criminal trials.
34 The Hegnas also have asserted that the
VCCR does not apply, because TRIA applies
“Notwithstanding any other provision of law[.]”
TRIA § 201(a). The VCCR, however, does not
conflict with the TRIA. Instead, TRIA (1) gives
parties who have secured judgments against ter-
rorist states a new opportunity to satisfy their judg-
ment; but also (2) attempts to insulate properties
subject to international agreementsSSlike the
VCCRSSfrom liquidation procedures.

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the consular residence “exclusively for
diplomatic or consular purposes.” The Hegnas
emphasize the fact of the rental and argue that
the government has used the proceeds for a
nondiplomatic purpose. The magistrate judge
described the two uses of the proceeds
generated from renting the former consulate
home:
The funds received from the rentals have
been deposited into segregated accounts,
with the funds necessary for repairs and
maintenance placed in a special Iranian con-
sular account and the excess funds de-
posited into separate “blocked asset”
accounts. Funds in the blocked asset
accounts have recently been utilized to
compensate victims of terrorism under the
VTVPA.
Congress has directed the United States to
provide some of its rental proceeds to victims
of terrorism. As part of its payment-and-re-
linquishment regime, the VTVPA designates
“rental proceeds accrued on the date of the en-
actment of this Act from Iranian diplomatic
and consular property located in the United
States” as a primary source of funding.
VTVPA § 2002(b)(2)(A).
The mixed uses of the funds and the fact
that some funds have gone to satisfy a domes-
tically-crafted payment regime require us to
consider whether the United States has used
the Houston property “exclusively” for
diplomatic and consular purposes. Two
factors ultimately weigh in favor of an
affirmative answer.
First, purpose differs from effect or result.
The United States may rent the property for
the purpose of using the funds to maintain and
preserve the property pursuant to the VCCR.
The rental, however, may generate additional
revenue that, at Congressional direction, the
United States may allocate for other purposes.
The Hegnas have not shown evidence
regarding the government’s intent. Given such
a lack of evidence and the government’s
obligation to “respect and protect” the
property pursuant to the VCCR, we are
reluctant to impute nondiplomatic motivations
to the government’s renting of the Houston
property.
Secondly, the Hegnas read “diplomatic pur-
pose” too narrowly. Although the United
States allocates funds to satisfy VTVPA judg-
ments, and although the payment regime aris-
es from a domestic payment arrangement,35 the
issues certainly concern diplomatic matters.
The United States purportedly has attempt-
ed to fulfil the obligations of the VCCR. By
not selling the Houston property and by using
rental proceeds to carry out routine
maintenance, the government “respect[s] and
protect[s]” the property presumably for the
time when the two countries might resume
35 The entire exchange between Congress and
the Executive nicely illustrates the tensions that
may develop between governmental actors with dif-
ferent institutional roles. Congress, through
AEDPA and TRIA, has attempted to provide great-
er opportunities for victims of terrorism to collect
on judgments against the states that sponsor and
support such actions. By exempting properties
subject to international tribunals and treaties such
as the VCCR, VTVPA and TRIA acknowledge the
Executive’s general power to administer diplomatic
affairs. U.S. CONST. art. II, § 2(2). The Executive
has taken full advantage of the congressional
exception.

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diplomatic and consular relations.36
The Executive Branch has simultaneously
attempted to compensate parties harmed as a
result of Iran’s support of terrorism and to ad-
minister consular property in accord with the
VCCR. By maintaining the property, the
United States has used the former General
Consul’s residence within the terms of the
TRIA exclusion. Consequently, the district
court did not err in its determination that the
Houston property fell outside the definition of
a “blocked asset” and did not err in its grant of
the United States’ motion.
V.
Consequently, the district courts did not err
by quashing the writs of attachment and
execution. By applying for a payment under
the VTVPA, the Hegnas agreed, on receipt of
a partial payment, to relinquish the right to
execute against Iranian property “at issue”
before bodies such as the Iran-United States
Claims Tribunal. The Lubbock property fits
that description. Additionally, although
Congress gave families of terror victims
greater rights to satisfy their judgments, it
expressly exempted consular property such as
that located in Houston.
Based on the regime that Congress has en-
acted and that the Executive has implemented,
the Hegnas cannot satisfy their otherwise
proper and valid judgment and cannot collect
against the property involved in this case. If
some injustice exists, those two bodies have
the responsibility to correct it.
The judgments at issue are AFFIRMED.
36 If, in accordance with the Hegnas’ theory,
the United States risks exposing consular property
to attachment and sale whenever it uses any rental
proceeds to pay a judgment pursuant to the
VTVPA, it may merely choose not to use any
rental proceeds to satisfy any judgments against
terrorist states. The government would still use the
property for a diplomatic or consular purpose, but
families seeking recovery under the VTVPA would
have fewer sources of proceeds with which to
satisfy their judgments.

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