UPDATE - US Supreme Court sends Halkbank case back to lower court for reconsideration

ADDS DETAILS THROUGHOUT

By Michael Hernandez

WASHINGTON (AA) - The US Supreme Court handed Turkish state lender Halkbank another chance to make its case in a lower court on Wednesday, ordering the Second Circuit Court of Appeals to reconsider the case.

A majority opinion from the top US court threw out the court's opinion allowing the prosecution to proceed, saying it disagrees with Halkbank's contention that a 1976 law known as the Foreign Sovereign Immunities Act (FSIA) shields it from criminal prosecution. But it ordered the appellate court to reconsider whether the bank has immunity under "common-law" principles.

"The Second Circuit did not fully consider various common-law immunity arguments that the parties raise in this Court," Associate Justice Brett Kavanaugh wrote for the court majority. "The Court vacates the judgment and remands for the Second Circuit to consider those arguments."

Only two of the court's nine justices -- Neil Gorsuch and Samuel Alito -- wrote in dissent.

Halkbank was indicted in 2019 by a federal grand jury in New York on charges of money laundering and conspiracy to help Iran evade US sanctions. The firm has pleaded not guilty.​​​​​​​

Halkbank had sought to claim sovereign immunity to shield itself from prosecution as part of its defense, but the Supreme Court said the FSIA’s prosecutions do not apply to criminal cases.

"Relying on the Foreign Sovereign Immunities Act, Halkbank contends that it enjoys immunity from criminal prosecution. We disagree because the Act does not provide foreign states and their instrumentalities with immunity from criminal proceedings," Kavanaugh wrote.

But the court said that the appellate court did not address another line of argument from Halkbank’s attorneys.

The Second Circuit Court of Appeals did not "address whether and to what extent foreign states and their instrumentalities are differently situated for purposes of common-law immunity in the criminal context,” Kavanaugh wrote.

"We express no view on those issues and leave them for the Court of Appeals to consider on remand," he added.​​​​​​​