McKesson Corp. v. Islamic Republic of Iran

On Tuesday, the U.S. Court of Appeals for the District of Columbia Circuit decided McKesson Corp. v. Islamic Republic of Iran. The case was first filed in 1982 and alleges, in brief, that Iran had expropriated McKesson's shares in an Iranian dairy company. Suffice it to say, the case has a complicated procedural history, including four previous trips to the Appeals Court. For this fifth appearance, the Court was asked to decide whether the 1955 Treaty of Amity, Economic Relations, and Consular Rights between the United States and Iran provides McKesson with a private cause of action. The Court held (opinion here) that the Treaty of Amity did not provide such a cause of action. Writing for a panel that included Judges Tatel and Garland, Judge Griffith explained that the presumption against a treaty-based cause of action (a principle that he finds in the recently decided Medellín v. Texas, 128 S. Ct. 1346, 1365–66 (2008)) was not overcome here. He wrote: "To be sure, article IV(2) of the Treaty of Amity directly benefits McKesson by declaring that 'property shall not be taken except for a public purpose, nor shall it be taken without the prompt payment of just compensation.' McKesson contends that the Treaty of Amity creates a right ('property shall not be taken') and provides a remedy ('just compensation'), and that together these make a cause of action. Not so. The Treaty of Amity tells us what McKesson will receive — money — but leaves open the critical question of how McKesson is to secure its due. For a federal court trying to decide whether to interject itself into international affairs, the Treaty of Amity’s silence on this point makes all the difference. . . . In the absence of a textual invitation to judicial participation, we conclude the President and the Senate intended to enforce the Treaty of Amity through bilateral interaction between its signatories." In so finding, the Court made clear that it gave "great weight" to the views of the United States as amicus curiae. The Court remanded the matter to the district court for it to determine whether McKesson has a cause of action under Iranian law, whether McKesson has a cause of action under customary international law, and, finally, whether the act of state doctrine applies to this case.