October 04-2013
A US prosecutor says the Iranian-owned building at Manhattan will be sold and the revenue turned over to US victims of terrorism who have won court judgments against Iran.
The Iran Times reported last week that the seizure of the 36-story office building by the federal government might keep it out of the hands of people filing suits against Iran by locking its ownership up in US government hands.
But Preet Bharara, the US attorney in Manhattan, said that is not what he is going to do. He said the revenues from the sale would be used to compensate victims of Iranian-sponsored terrorism.
Hundreds of Americans have won suits against Iran with judgments on the order of $20 billion and still growing. The building at 650 Fifth Avenue at the corner of 52nd Street and the edge of Rockefeller Center is estimated to be worth from $500 million to $700 million or far less than 5 percent of all the judgments. That may set off a scramble to try to get hold of the limited funds available.
But there is no need to rush. The building won’t be sold any time soon.
Many Iranian news outlets last week reported that the building had already been seized by the US government. That is erroneous. The court decision last week (see last week’s Iran Times, page two) said the building could be seized by the US government, but not until any appeals to that decision are decided, which may take years.
Iran does not, however, get any rental income from the building now. When the US government filed suit to seize the property in 2008, it was put under the management of a court-appointed administrator and the rental income frozen along with the building itself.
The lawyers for the building’s owners—the Alavi Foundation, which is the successor to the Shah’s Pahlavi Foundation, and Assa Corp.—have said they will appeal.
The issue in the case was whether Alavi and Assa were independent entities not under Iranian control or really just part of the Iranian government. The judge in the case ruled last week that the true ownership was so obvious that there was no need for a trial. The appeal will be to that decision. So, if the appeal is won, it will not mean the owners get the building back, only that the issue of who really owns the building will then go to a full trial.