Supreme Court Removes Block on Judgment Involving Late Filipino Leader’s $40 Million

Alleged victims of abuse want control over $40 million in funds held in the United States by the late Filipino strongman, Ferdinand Marcos.

Supreme Court Justice Sonia Sotomayor speaks in the Great Hall of the Supreme Court in Washington on Dec. 18, 2023. Jacquelyn Martin/Pool/Getty Images

The U.S. Supreme Court on Nov. 14 allowed a judgment to take effect that gives the Republic of the Philippines control over $40 million that the late Filipino leader Ferdinand Marcos held in the United States.

Marcos, who was president of the Philippines from 1965 to 1986, was described in court papers as “a dictator and kleptocrat” who “stole billions of dollars from the country and its people and “used networks of foreign financial accounts and shell corporations to hide stolen funds.”

The late president described his own reign as “constitutional authoritarianism.” His son, who shares his name, has been president of the Philippines since 2022.

Victims of the former regime who claim to have suffered human rights abuses won a $2 billion judgment against the estate and want control over the $40 million that the late president previously deposited in a Merrill Lynch account. They filed an emergency application with the Supreme Court on Oct. 30 after the U.S. Court of Appeals for the Second Circuit on Aug. 18 gave control over the funds to the Philippines.

Supreme Court Justice Sonia Sotomayor on Nov. 5 temporarily stayed the Second Circuit judgment.

On Nov. 14, Sotomayor vacated the stay, which returned control over the monies to the government of the Philippines.

After the new ruling, Robert Swift of Kohn, Swift, and Graf, in Philadelphia, who is the attorney for the victims’ representative, Jose Duran, said he was disappointed the Supreme Court vacated the order.

“I intend to file a petition for certiorari by mid-December,” challenging the lower court orders, the lawyer told The Epoch Times.

A petition for certiorari is a document people file with the Supreme Court when they want to appeal a lower court ruling. For a case to be scheduled for oral argument, at least four of the court’s nine justices must vote to grant the petition.

Sotomayor said in her new order that she was canceling the stay “given the Government’s representation that it will not transfer the funds outside of the United States before the disposition of any petition for a writ of certiorari.”

The Second Circuit had affirmed a federal district court ruling giving control over the $40 million to the government of the Philippines.

The district court ruling, in favor of the government of the Philippines, which came at the conclusion of a lawsuit the U.S. attorney general filed on behalf of the Philippines, is based on a judgment that was issued in 2009 in the Philippines by an anti-corruption court called the Sandiganbayan.

The victims disagree with the ruling of the district court and wish to execute on the $40 million that Marcos previously held in an account at Merrill Lynch in New York City.

Duran, on behalf of the victims, asked the Supreme Court to stay the judgment to give him time to file a petition for certiorari with the high court, according to the application.

In the United States, a federal interpleader action was previously initiated.

That is a legal proceeding initiated by a party holding property who has received competing claims to it. The idea is that disputes over the property will be resolved in a single court case, preventing the property holder from having all claimants litigate their claims against each other.

The U.S. government had filed a lawsuit in U.S. courts under Section 2467 of Title 28 of the United States Code to enforce the 2009 judgment of a Philippine court. Section 2467 allows the federal government to sue to enforce a foreign court’s judgment for “any violation of foreign law that would constitute a violation or an offense for which property could be forfeited under Federal law if the offense were committed in the United States.”

The federal government also brought the lawsuit under a 1994 treaty between the United States and the Republic of the Philippines, which commits the two countries to assist each other in matters of criminal law, including the forfeiture of assets.

The victims argue U.S. courts should not recognize the foreign judgment because the Sandiganbayan lacked jurisdiction, the statute of limitations had lapsed, and the victims were never given proper notice.

On Jan. 12, 2024, a federal district court granted summary judgment recognizing the foreign judgment.

Duran appealed to the Second Circuit. On Aug. 18 of this year, the appeals court denied the appeal.

On Oct. 21, Duran asked the Second Circuit to stay the judgment because he intends to petition the Supreme Court for review. On Oct. 27, the request was denied.

Duran said in the application that the Second Circuit went against its own precedents and longstanding Supreme Court precedents.

The appeals court’s decision “is the first in American jurisprudence to recognize the in rem jurisdiction of a foreign court over property held in [custodia] legis of a U.S. federal court.”

In rem jurisdiction means jurisdiction, or authority, in a legal action taken directly against property, as opposed to a person. Property that is held in custodia legis is under the control of a court during a legal proceeding.

The Epoch Times reached out to the Department of Justice for comment. No reply was received by publication time.