By Emily Flitter
NEW YORK (Reuters) - The U.S. government on Wednesday asked a federal judge in Manhattan to dismiss a private civil lawsuit against an Iran sanctions group on national security grounds without any public explanation for the reason.
If the judge agrees, it would mark the first time the government had invoked the state secrets privilege without publicly explaining its motivation for doing so.
The Justice Department wants to use the privilege, which it can employ in cases where national security is threatened, to dismiss a suit by Greek businessman Victor Restis against a non-profit group for defamation. The group, United Against Nuclear Iran (UANI), accused him of illegally exporting oil from Iran.
A ruling by U.S. District Judge Edgardo Ramos allowing use of the privilege - more closely associated with cases involving government surveillance, extraordinary rendition and espionage - without a public explanation could set a precedent for it to be used with minimal disclosures either to the public or to opposing parties in lawsuits.
Government lawyers have argued that national security could be jeopardized if UANI is forced to turn over certain documents as part of routine proceedings in the case. They did not provide details.
Assistant U.S. Attorney Michael Byars hesitated during a hearing on Wednesday when Judge Ramos asked whether he had been able to find any cases in which the government had been allowed to use the state secrets privilege without providing a public explanation.
In the end, he did not dispute the claim by Restis's lawyer Abbe Lowell that the Restis case would be the first to be dismissed under the privilege without the government submitting a public affidavit describing the nature of the information that needed to be kept secret.
"Public disclosure must not risk the secrets at issue," Byars said, adding that not even Restis's lawyers could be told about the secret information because the case is civil, not criminal, and "it's not done."
There has been virtually no indication of what the information in question may be. UANI, which is funded in part by the American mining tycoon Thomas Kaplan, whose family has ties to Israel, includes several former intelligence chiefs on its advisory board, including the former head of Israel's Mossad, Meir Dagan. Its president, Gary Samore, stepped down in January 2013 as the White House Coordinator for Arms Control and Weapons of Mass Destruction.
UANI's mission is to name and shame people and companies doing business with Iran while the country pursues what UANI perceives to be an illegal nuclear weapons program.
UANI's lawyer, Lee Wolosky, said during Wednesday's hearing that the group needed to be allowed to continue its activities unhindered and would not agree to stop making public statements about Restis's dealings in Iran. Judge Ramos had proposed such a halt might be a compromise that UANI and Restis could reach if the government's request to dismiss the case were ultimately granted.
Judge Ramos asked the government and the two parties to submit written arguments explaining why the government should or should not have to publicly explain its reasons for invoking the state secrets privilege.
Lowell asked Ramos: "After everything - the torture, the rendition, the eavesdropping...This is the case that stands for the proposition that privilege can be asserted in the dark?"
(Reporting By Emily Flitter; Editing by Ken Wills)