Bank Melli Iran Bank Mellat v. Shams Pahlavi, AKA H.I.H. Princess Shams Pahlavi

Bank Melli Iran and Bank Mellat (the Banks) filed this action for the purpose of enforcing certain judgments, which they had obtained against Shams Pahlavi in the tribunals of Iran. She is a resident of California and is the sister of the former Shah of Iran. The district court determined that at the times that the judgments were obtained Pahlavi could not have obtained due process of law in the courts of Iran. It, therefore, granted summary judgment in her favor. The Banks appeal and we affirm.

BACKGROUND

In January of 1979, the Shah of Iran fled the country in the midst of the series of events that ultimately resulted in the creation of the Islamic Republic of Iran. Prior to that time, Pahlavi, the Shah’s older sister, had signed a number of promissory notes.

The Banks, which were the holders of those notes and which are at the very least closely associated with the government, brought collection actions against Pahlavi in the courts of Iran. They served her by publication and in 1982 and 1986 obtained default judgments in the total amount of $32,000,000. They now seek to enforce those judgments pursuant to the Algerian Accords and pursuant to the California Uniform Foreign…