ways. It tried and failed to have the 1904 Cargo Preference Act amended. It made an offer to pay Icelandic shipping firms monetary damages for loss of the route, which was refused. President Reagan asked United States Secretary of the Navy John F. Lehman, Jr. to determine if Rainbow's claim under the Cargo Preference Act was valid, and on 8 August 1985, Lehman declared Rainbow's rates to be "excessive and unreasonable." Within four days, Rainbow pressed suits in United States District Court against "the Department of the Navy and various other federal agencies" as well as "the Secretary of the Navy and various other government officials in their personal capacities." The suits demanded declaratory and injunctive relief from the federal agencies and monetary damages from the named individuals. The International Organization of Masters, Mates & Pilots, representing Rainbow Hopes crew, joined Rainbow in the suits. On 15 October 1985, the District Court issued its order, granting Rainbow's requests for declaratory and injunctive relief, and ordered the government to withdraw a call for new bids. The government appealed the finding. On 27 January 1986, the panel of the D.C. Circuit Court of appeals consisting of future Supreme Court Justice Antonin Scalia, future Starr Report special prosecutor Kenneth Starr and Senior Circuit Judge Carl E. McGowan upheld Rainbow's victory. During the appeal, the government's attorneys conceded that Lehman's finding of Rainbow's rates to be "excessive and unreasonable" was politically motivated, and the court found some arguments put forth by Shultz and Lehman "extraordinary" and having "no rational basis". In particular, Scalia wrote that the "factual basis for (Lehman's) assertion (wa)s utterly lacking." During this time, Transportation Secretary Elizabeth Dole supported Rainbow, according to the Chicago Tribune, as a viable employer of United States mariners. Eight months later, the government took a different approach to solve its problem with Rainbow, in the form of the 1986 Treaty Between the United States of America and the Republic of Iceland to Facilitate Their Defense Relationship. This treaty, negotiated by future Secretary of Veteran Affairs Ed Derwinski, updated the 1951 U.S.–Iceland treaty, adding an explicit exemption of the Cargo Preference Act, guaranteeing 35% of the contract would go to Icelandic companies, and giving Icelandic companies an opportunity to compete for up to 65% of the contract." At the time, Derwinski said, "If we don't solve this problem, then the U.S. will be in a cod war".