US says no to sanctions against Russia in Chabad case

The Art Newspaper 4 September 2012

Government statement says monetary fines would be contrary to foreign policy interests

Just said no: the Department of Justice has filed a statement urging the denial of sanctions against Russia in response to its art embargo

The Obama administration has asked a federal court to stay out of US foreign and Russian internal affairs in the seven-year-old case brought against Russia by the Jewish sect Chabad. The government’s statement of interest leaves Chabad with what appears to be an unenforceable judgment.The Department of Justice urged the federal District Court in Washington, DC, not to impose monetary sanctions against Russia, in a statement filed with the court on 29 August. The statement said that sanctions requested by the Jewish sect Chabad “would be contrary to the foreign policy interests of the United States”, impermissible under US law and, since Russia would be sanctioned for failing to perform an act within its own territory, “entirely without precedent internationally”.

In the underlying litigation, Chabad is seeking two separate collections of books and manuscripts held in Moscow. After Russia abandoned the case in 2009, a US court issued a default judgment against it in July 2010. That judgment ordered Russia “to surrender [the collections] to the United States Embassy in Moscow or to the duly appointed representatives of [Chabad]”. Russia refused.

Russia initiated its art embargo shortly thereafter, saying it feared that any art sent into the US would be seized to force the country to comply with the court’s order. Chabad sought to enforce the judgment with sanctions and requested that the court impose substantial weekly fines on Russia. The court, worried that sanctioning a foreign government could have foreign policy implications, asked the US to weigh in, and the administration’s statement came in response to that invitation.

Chabad now holds what appears to be an unenforceable judgment. Legal experts agree that it cannot be taken to Moscow and enforced there, and the US government is now stating that it is against its interests to enforce the judgment with sanctions in the US.

The government reiterated its strong support for Chabad’s claim to transfer the collections and its commitment to continued diplomatic efforts dating back to the 1990s to accomplish that. However, “it is the United States’ judgment that the imposition of the requested civil contempt sanctions against Russia would be counter-productive to these efforts, as well as for related issues such as the continuing Russian embargo on art loans to the United States. The inevitable accumulation of monetary contempt sanctions would also only serve to create an enduring new obstacle to resolving the dispute.”

Attempts to reach Chabad’s attorneys were unsuccessful.
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