Facts of the Case

In reaction to the seizure of the U.S. embassy and American nationals in Iran, President Jimmy Carter invoked the International Emergency Economic Powers Act (IEEPA) and froze Iranian assets in the United States. When the hostages were released in 1981, Treasury Secretary Donald Reagan affirmed the agreements made the Carter administration that terminated all legal proceedings against the Iranian government and created an independent Claims Tribunal. Dames & Moore attempted to recover over $3 million owed to it by the Iranian government and claimed the executive orders were beyond the scope of presidential power.

Question

Did the president have the authority to transfer Iranian funds and to nullify legal claims against Iran?

Conclusion

The Court held that the International Emergency Economic Powers Act constituted a specific congressional authorization for the President to order the transfer of Iranian assets. The Court further held that although the IEEPA itself did not authorize the presidential suspension of legal claims, previous acts of Congress had "implicitly approved" of executive control of claim settlement. The Court emphasized the narrowness of its ruling, limiting the decision to the facts of the case.