The International Court of Justice (ICJ) has affirmed its jurisdiction to hear a case brought by Iran to recover billions of dollars in assets that are frozen in the United States.
The court ruling was in response to a motion by the United States for the court to throw out the claim by Iran to recover some $2 billion in bank assets seized by U.S. courts.
ICJ chief Judge Abdulqawi Ahmad Yusuf said the court "unanimously rejects the preliminary objections to admissibility raised by the United States of America."
The lawsuit was filed with the UN high court at The Hague by Iranian officials on October 8. Tehran is seeking to regain funds that were impounded during the 1979 Islamic Revolution in Iran.
The U.S. Supreme Court ruled in 2016 that the funds must be turned over to American families of victims of alleged Iranian terrorist attacks, including the 1983 bombing of a U.S. Marine barracks in Beirut, in which 241 soldiers were killed, and the 1996 Khobar Towers bombing in Saudi Arabia.
"The actions at the root of this case center on Iran's support for international terrorism," which should disqualify it from presenting a case before the court, Richard Visek, legal adviser to the U.S. Department of State, told the court.
"Iran comes to the court with unclean hands. Indeed, it is a remarkable show of bad faith," he said. "Iran's bad acts include support for terrorist bombings, assassinations, kidnappings, and airline hijackings."
The current Iranian case before the UN high court is separate from Iran's lawsuit against U.S. economic sanctions, which the court decided in Iran's favor last week.
Like the sanctions case, Iran is basing its claim to recover impounded funds on a 1955 Amity Treaty with the United States, which was signed 24 years before its Islamic Revolution.
Washington announced last week it would withdraw from the treaty, but it could take up to a year for that withdrawal to take effect.