By Natalie Rodriguez
(Law360, New York)

The family of a terrorist hostage victim who holds a $28.8 million judgment against Iran asked a New York federal court on Wednesday to be let in on a lien priority dispute related to the sale of Iran's interests in a Manhattan tower.

Jeremy Levin, who was kidnapped in 1984 by terrorists allegedly funded by Iran, and Lucille Levin motioned to intervene in the case, arguing that a 2009 Washington, D.C., district court judgment that was registered in New York late last year allows them a spot at the table with other creditors looking to score a piece of the stake sale proceeds.

“It would be a miscarriage of justice to allow the other judgment creditors in the same position as the Levins to recover all of the assets from this action, while the Levins’ judgment is left unsatisfied,” the family argued in a memorandum supporting their motion.

The Levins contend they were informed about the seizure of 650 Fifth Ave. through media reports and were wrongfully not put on notice as potential claimants by the U.S. government. They blasted a 2014 settlement agreement with certain judgment creditors in the New York case that would essentially distribute all the net proceeds of the sale of the building after litigation expenses and sales costs are taken out.

“Thus, the Levins are in the position of having relied upon the rules and upon the representations of the U.S. government in claiming their rights as victims, but having been cut out of any recovery with no due process at all. The court should therefore grant the Levins’ motion to intervene and allow the Levins to pursue their claim to some of the funds in the civil forfeiture action,” the family said in its memorandum.

The Levins are not the only family looking to carve out a spot in the case. The Hegnas, the family of a U.S. diplomat killed by Iranian terrorists, have been fighting for a piece of the proceeds for several years and recently urged the court to consider new evidence that the family contends is sufficient to warrant the renewal of a real property docketing lien, according to court documents. The Hegnas currently have an outstanding motion for partial summary judgment as to the enforcement priority in the long-running case.

With that motion pending, the Levins contend their motion to intervene causes no prejudice to the current litigation parties by delaying the case further and argue that their motion should take less than a month to resolve.

Other plaintiff-claimants, however, have been pushing a motion for summary judgment against the Hegnas’ claimed lien on 650 Fifth Ave.

The Levins are represented by Suzelle M. Smith and Don Howarth of Howarth & Smith.

The case is In re: 650 Fifth Avenue and Related Properties, case number 1:08-cv-10934-KBF, in the U.S. District Court for the Southern District of New York.