The sanctions grow out of a ten-year effort by Chabad to regain possession of two expropriated collections of religious books held by the Russian government. After losing its jurisdictional arguments, the Russian government refused to participate in the litigation and in 2010 a default judgment was entered against it. The court then imposed civil sanctions of $50,000 per day until defendants comply with the court's order. (See prior posting.) The United States government argued against the court granting the current interim judgment, claiming that this will further damage U.S. foreign policy interests including efforts to reach a settlement with defendants on plaintiffs' behalf. The court disagreed saying generally:
Given the United States' current sanctions against Russia and Russian interests based upon various geopolitical events, the Court is unpersuaded by such a vague concern in this case.The court also pointed out that this is not an enforcement action. Enforcement issues will arise only when plaintiff identifies property in the United States to attach.
Reporting on the decision, the Legal Times quotes plaintiffs' lawyer who says this decision will permit plaintiffs to register a judgment in other states and look for assets to attach. He said Chabad will not go after Russian art or cultural objects on loan to U.S. museums. Meanwhile, as previously reported, in a split with Chabad in the U.S., the Russian branch of Chabad supports the Russian government's compromise arrangement which involves digitizing one of the collections and moving it to Moscow's new Jewish Museum and Tolerance Center.