In January 2008, a group of American families obtained a U.S. $6 billion judgment in U.S. District Court against Libya in connection with the 1989 bombing of UTA Flight 772 in which 170 persons lost their lives, including 7 Americans. See Pugh v. Socialist People’s Libyan Arab Jamahiriya, 530 F.Supp.2d 216 (D.D.C. 2008). The Americans sued under the 1996 Anti-Terrorism Act and the Foreign Sovereign Immunities Act. In August, the governments of Libya and the U.S. reached a settlement agreement pursuant to which Libya agreed to pay the U.S. $1.5 billion in settlement of these claims and others. According to the U.S. State Department, the beneficiaries of the seven American victims will each be eligible to receive approximately $10 million. Some of the Pugh families are unhappy that they took their case to court and won, only to have the judgment nullified by the U.S. government and their award significantly reduced. On the one hand, it may be argued that the U.S. government used these families to pressure Libya into a settlement by encouraging them to invest significant resources, financial, emotional and otherwise, in a lawsuit. On the other hand, the families did get the public condemnation of LIbya they say they desired and they are much more likely to actually recover money from Libya under the settlement than through efforts to collect on their judgment, so perhaps this result is not so bad in the long run. As a legal matter, the President’s power to enter into agreements with foreign nations to settle monetary claims has been upheld numerous times in cases, such as Dames & Moore, Garamendi, Pink, and Belmont. In this case, it appears the President is on particularly solid legal ground because Congress has approved the settlement agreement in the Libyan Claims Resolution Act.
For more background, see the N.Y. Times article at: http://www.washingtonpost.com/wp-dyn/content/article/2008/12/22/AR2008122202050.html?wpisrc=newsletterse
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