1 See United States Diplomatic and Consular Staff in Tehran (U.S. v. Iran), 1980 ICJ Rep. 3, 12 (May 24).

2 Declaration of the Government of the Democratic and Popular Republic of Algeria, Jan. 19, 1981, 75 AJIL 418 (1981); Declaration of the Government of the Democratic and Popular Republic of Algeria Concerning the Settlement of Claims by the Government of the United States of America and the Government of the Islamic Republic of Iran, Jan. 19, 1981, id. at 422 [hereinafter Claims Settlement Declaration].

3 Claims Settlement Declaration, supra note 2. The constitutionality of the Algiers Accords was challenged and upheld in Dames & Moore v. Regan, 435 U.S. 654 (1981), summarized in 75 AJIL 954 (1981).

4 Foreign Relations Authorization Act, Fiscal Years 1986 and 1987, Pub. L. No. 99–93, tit. V, 99 Stat. 405, 437 (1985) (50 U.S.C. §1701 note (1994)) [hereinafter Iran Claims Settlement].

5 Abrahim-Youri, 139 F.3d 1462, 1464.

6 Settlement Agreement in Claims of Less than $250,000, Case No. 86 and Case No. B38, AWD 483, 25 Iran- U.S. Cl. Trib. Rep. 327 (1990 II) [hereinafter Settlement Agreement].

7 Abrahim-Youri, 139 F.3d at 1464. The Settlement Agreement also provided for the “transfer to Iran (by quitclaim) of all property interests underlying the small claims.” Id.

8 See Richard, B. Lillich & David, J. Bederman, Jurisprudence of the Foreign Claims Settlement Commission: Iran Claims , 91 AJIL 436, 436–38 (1997)Google Scholar.

9 See Abrahim-Youri, 139 F.3d at 1464.

10 See Lillich & Bederman, supra note 8, at 437.

11 Abrahim-Youri, 139 F.3d at 1464–65.

12 Brief of Plaintiffs-Appellants, Abrahim-Youri et al., at 12 (Fed. Cir. 1997) (No. 97–5011).

13 “[N]or shall private property be taken for public use, without just compensation.” U.S. CONST, amend. V. It has been disputed whether the Court of Federal Claims has jurisdiction in such cases. See Daniel, Barstow Magraw, Jurisdiction of Cases Related to Treaties: The Claims Court’s Treaty Exception , 26 Va. J. Int’l L. 1 (1985)Google Scholar; Phillip, R. Trimble, Foreign Policy Frustrated—Dames & Moore v. Regan, Claims Court Jurisdiction, and a New Raid on the Treasury , 84 Colum. L. Rev. 317 (1984)Google Scholar.

14 Abrahim-Youri, 139 F.3d at 1465.

15 438 U.S. 104 (1978).

16 Abrahim-Youri v. United States, 36 Fed. Cl. 482, 486 (1996) (citing Penn Central, 438 U.S. at 124).

17 The court of appeals noted the distinction between a regulatory taking and a per se taking:

It is true that there are important analytical differences that must be respected between a claim for a taking based on a regulatory imposition that constrains an owner’s continuing use of property, and one that is based on an outright governmental seizure or occupation of private property. The former is referred to as a “regulatory” taking; the latter as a “physical” (sometimes “per se”) taking. The Supreme Court has made it clear that these two different fact patterns call for two different analytical approaches.

139 F.3d at 1465.

18 Id.

19 See id. at 1467 (quoting Nat’l Bd. of Young Men’s Christian Ass’ns v. United States, 395 U.S. 85, 92 (1969)).

20 858 F.2d 706 (Fed. Cir. 1988).

21 Id. at 709.

22 The court in Belk quoted the Supreme Court’s language from National Board of Young Men’s Christian Associations:

[W]here, as here, the private party is the particular intended beneficiary of the governmental activity, “fairness and justice” do not require that losses which may result from that activity “be borne by the public as a whole,” even though the activity may also be intended incidentally to benefit the public.

395 U.S. at 92. See also Shanghai Power Co. v. United States, 4 Cl. Ct. 237, 241–46 (1983).

23 139 F.3d at 1466–67.

24 2 Ct. Cl. 224 (1866).

25 21 Ct. Cl. 340 (1886).

26 The court in Meade noted:

A man’s choses in action, the debts due him, are as much property and as sacred in the eye of the law as are his houses and lands, his horses and his cattle. And when taken for the public good, or released or cancelled to secure an object of public importance, are to be paid for in the same manner. In all such cases the right of the citizen and the obligation of the sovereign are perfect. The remedy is to be provided by the government.

2 Ct. Cl. at 275, aff’d on other grounds, 76 U.S. 691 (1869).

27 Gray was the first of the so-called French Spoliation Cases. The Gray court specifically noted:

[T] he citizen whose property is thus sacrificed for the safety and welfare of his country has his claim against that country; he has a right to compensation, which exists even if no remedy in the courts or elsewhere be given him. A right often exists where there is no remedy, and a most frequent illustration of this is found in the relation of the subject to his sovereign, the citizen to his Government.

It seems to us that this “bargain” . . . which was brought about by the sacrifice of the interests of individual citizens, falls within the intent and meaning of the Constitution, which prohibits the taking of private property for public use without just compensation.

21 Ct. Cl. at 392–93, reconsideration denied sub now.. Cushing v. United States, 22 Ct. Cl. 1 (1886). See also]. Toelle, H., The Court of Claims: Its Jurisdiction and Principal Decisions Bearing on International Law , 24 Mich. L. Rev. 675 (1926)CrossRefGoogle Scholar.

28 139 F.3d at 1467.

29 505 U.S. 1003 (1992).

30 139 F.3d at 1467–68. Since Lucas, the scope of interests that are entitled to protection under the Fifth Amendment is defined by existing background principles, which stem from an independent source. 505 U.S. at 1030. The Supreme Court in Lucas held that background principles of state property law defined the scope of an individual’s property rights. Common law restrictions on land use are implicit in all land titles, and allow government to take certain actions that would not constitute a taking of property. See id. In short, the “bundle of rights” called property did not include those “sticks” which the Government retained in its state property law.

31 139 F.3d at 1468.

32 Judge Clevenger articulated this principle more specifically in his concurrence:

When one ventures into international commerce, it is with the knowledge of the extent to which that marketplace is regulated, and with appreciation for the reasons which underly such regulation, including the overriding need to enforce this nation’s foreign policy. . . . One who obtains, in the pursuit of international commerce, a claim against a foreign government knows that our government may deem it necessary to espouse that claim.

Id. at 1469 (Clevenger, J., concurring).

33 The harm/benefit test encompasses two tenets: The Government does not effect a compensable taking when it prevents individuals from using their property to harm others. However, a compensable taking occurs when the Government attempts to obtain a “public benefit” at an individual’s expense. See, e.g., Lynda, J. Oswald, The Role of the “Harm/Benefit” and “Average Reciprocity Advantage” Rules in a Comprehensive Takings Analysis , 50 Vand. L. Rev. 1447, 1458–59 (1997)Google Scholar.

34 See, e.g., Mugler v. Kansas, 123 U.S. 623, 648–81 (1887). See also Alan, E. Brownstein, The Takings Clause and the Iranian Claims Settlement , 29 UCLA L. Rev. 984 (1982)Google Scholar.

35 Lucas involved a property owner’s challenge to a state statute that devalued his land. Justice Scalia observed:

It is quite possible, for example, to describe in either fashion the ecological, economic, and esthetic concerns that inspired the South Carolina Legislature in the present case. One could say that imposing a servitude on Lucas’s land is necessary in order to prevent his use of it from “harming” South Carolina’s ecological resources; or, instead, in order to achieve the “benefits” of an ecological preserve. . .

. . . [T]he distinction between regulation that “prevents harmful use” and that which “confers benefits” is difficult, if not impossible, to discern on an objective, value-free basis . . . .

505 U.S. at 1024–26 (citations omitted).

36 The Federal Circuit, without any authority, relied heavily on the proposition that the Government’s actions in entering into the Settlement Agreement had not been intended “to harm [the small claimants] or to gain a government benefit at their expense.” 139 F.3d at 1467. However, this reading of the Government’s actions is not entirely convincing. In the context of the hostage crisis, the Settlement Agreement could just as reasonably be viewed as an extension of negotiations to ensure, or further enhance, national security—the epitome of a “public benefit.” In this light, the Settlement Agreement would have obtained a “public benefit” (national security) at the expense of individual property rights (the small claimants’) and the Government would be obligated to compensate them.

37 See Lucas, 505 U.S. at 1030.

38 139 F.3d at 1468.