A company owned by the Emirate of Fujairah claimed a stake in an oil cargo that the U.S. alleges was from Iran, in violation of sanctions, and seized last year.

Fujairah International Oil & Gas Corp., wholly owned by Sheikh Hamad bin Mohammed Al Sharqi, the ruler of the emirate, claims it’s an intermediary seller of the cargo and that it is Iraqi oil, according to a document filed in federal court in the District of Columbia.

The U.S. alleges that Iran’s Islamic Revolutionary Guard Corps and the IRGC-Quds Force covertly shipped the oil abroad. Iran said the seizure of the cargo was an “act of piracy.”

Read More: Suspected Iranian Oil Finishes Discharging into Houston

The case underscores the challenges facing President Joe Biden in his pledge to restore diplomatic relations with Iran. Biden has proposed that the two nations return to the 2015 international agreement under which Iran agreed to limit its nuclear work in exchange for relief from economic sanctions.

FIOGC says that in June it bought 2 million barrels of crude from an undisclosed Iraqi supplier. The supplier presented bills of lading issued by Iraq’s state oil marketer SOMO as proof of origin, FIOGC says. In October, FIOGC sold the oil to an unidentified Chinese buyer. The U.S. government seized the cargo aboard the supertanker Achilleas before it could sail to China.

The Achilleas was rerouted to the U.S. Gulf Coast and the crude was discharged in Houston this month, the document shows.