home of its executive director on December 14, 2001 and seized a
considerable amount of material they felt was relevant to their
investigation of Global Reliefs activities. As the defendants have
conceded in their briefs, no warrant had been obtained before the
FBI arrived either at Global Reliefs headquarters or the executive
director's residence. Nevertheless, FISA includes a provision which
states that, when the Attorney General declares that "an emergency
situation exists with respect to the execution of a search to obtain
foreign intelligence information" prior to the Foreign Intelligence
Surveillance Court acting on the application, a warrantless search
is authorized. 50 U.S.C. § 1824 (e)(1)(B)(i).
When such an emergency situation arises, the government must submit
a warrant application to the Foreign Intelligence Surveillance Court
within 72 hours of the warrantless search for approval. See
50 U.S.C. § 1824 (e), as amended by, P.L. 107-108,
115 Stat. 1394, 1402 (2001). In this case, the failure of the FBI agents
to present a FISA warrant on December 14 was caused by the Assistant
Attorney General's declaration that an emergency situation existed with
respect to the targeted documents and material. The defendants did submit
a warrant application to the Foreign Intelligence Surveillance Court on
December 15, as required by 50 U.S.C. § 1824 (e). We have reviewed
the warrant that issued and the submissions to the Foreign Intelligence
Surveillance Court in support of that warrant.
We conclude that the FISA application established probable cause to
believe that Global Relief and the executive director were agents of a
foreign power, as that term is defined for FISA purposes, at the time the
search was conducted and the application was granted. We are also
satisfied that Global Relief and the executive director were not targeted
because of any protected First Amendment activities in which they may
have engaged. Given the sensitive nature of the information upon which we
have relied in making this determination and the Attorney General's sworn
assertion that disclosure of the underlying information would harm
national security, it would be improper for us to elaborate further on
this subject. See Squillacote, 221 F.3d at 554 (finding probable cause to
authorize FISA surveillance and declining to comment further on the
probable cause issue when the Attorney General filed an affidavit); United
States v. Isa, 923 F.2d 1300, 1304 (8th Cir. 1991) (same).
This Court has concluded that disclosure of the information we have
reviewed could substantially undermine ongoing investigations required to
apprehend the conspirators behind the September 11 murders and undermine
the ability of law enforcement agencies to reduce the possibility of
terrorist crimes in the future. Furthermore, this Court is persuaded that
the search and seizure made by the FBI on December 14 were authorized by
FISA. Accordingly, we decline plaintiffs request that we declare the
search invalid and order the immediate return of all items seized.
2. The International Emergency Economic Powers Act
Global Relief also asserts that the International Emergency Economic
Powers Act, 50 U.S.C. § 1701 et seq., (hereinafter "IEEPA") does not
authorize OFAC's blocking order freezing its assets. Specifically, Global
Relief raises the following three arguments: 1) IEEPA did not grant the
authority to block purely domestic assets "during the pendency of an
investigation;" 2) the blocking order in this case directly violated
IEEPA's humanitarian relief exception; and 3) the President never legally
delegated the authority to OFAC to block the assets of an organization
"during the pendency of an investigation."
Additionally, we note that
Global Relief raised for the first time in its reply brief the argument
that 18 U.S.C. § 2339B, and not IEEPA, is the proper statutory
mechanism "to prevent [persons] subject to the jurisdiction of the U.S.
courts from supporting designated foreign terrorist organizations."
(Global Relief Reply Brief at 12.) Because the defendants have not cited
this particular statutory provision in their briefs to justify OFAC's
blocking order, we will not address it. Cf. Marie O. v. Edgar,
131 F.3d 610, 614 n. 7 (7th Cir. 1997) (it is generally not appropriate
to consider new arguments raised for the first time in a reply brief);
United States v. Magana, 118 F.3d 1173, 1198 n. 15 (7th Cir. 1997)
(same); Kastel v. Winnetka Bd. of Educ., 946 F. Supp. 1329, 1335 (N.D.
i) Statutory and Regulatory Background
For most of this country's history, the United States government has
utilized economic sanctions as a tool of its foreign policy. For most of
the 20th Century, government imposed sanctions were controlled by the
Trading with the Enemy Act (hereinafter the "TWEA"), which was enacted in
1917. As amended in 1933, TWEA granted the President "broad authority" to
"investigate, regulate . . . prevent or prohibit . . . transactions" in
times of war or declared national emergencies. See 50 U.S.C. app. §
5(b); Dames & Moore v. Regan, 453 U.S. 654, 672, 101 S.Ct. 2972 (1981).
In 1977, Congress enacted IEEPA and amended TWEA to govern "the
President's authority to regulate international economic transactions
during wars or national emergencies." S. Rep. No. 95-466, at 2 (1977),
reprinted in 1977 U.S.C.C.A.N. 4540, 4541. IEEPA provides that the
economic powers granted the President "may be exercised to deal with any
unusual and extraordinary threat, which has its source in whole or
substantial part outside the United States, to the national security,
foreign policy, or economy of the United States, if the President
declares a national emergency with respect to such threat."
50 U.S.C. § 1701 (a); Regan v. Wald, 468 U.S. 222, 228, 104 S.Ct.
3026 (1984). As with TWEA, IEEPA authorized the President to:
investigate, regulate, direct and compel, nullify,
void, prevent or prohibit, any acquisition, holding,
withholding, use, transfer, withdrawal,
transportation, importation or exportation of, or
dealing in, or exercising any right, power, or
privilege with respect to, or transactions involving,
any property in which any foreign country or a
national thereof has any interest . . . by any
person, or with respect to any property, subject to
the jurisdiction of the United States.
50 U.S.C. § 1702 (a)(1)(B). As originally enacted, this language was
identical to the grant of power to the President under the parallel
provision of TWEA.
In response to the September 11 terrorist attacks, Congress in October
2001 enacted the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001, Pub L. 107-56, 115 Stat. 272 (the "USA Patriot Act"), which, inter
alia, expanded the authority of the President and his designees under
IEEPA. Specifically, section 106 of the new act added the words "block
during the pendency of an investigation" after the word "investigate" in
the above-quoted section of IEEPA's section 1702(a)(1)(B). The USA
Patriot Act also provided that, in case of judicial review of an IEEPA
blocking order, any classified information upon which the blocking
determination was made "may be submitted to the reviewing court ex parte
and in camera." 50 U.S.C. § 1702 (c) as added by 115 Stat. at 278.
Shortly after the September 11 attacks but before the enactment of the
USA Patriot Act, President Bush issued Executive Order 13224, effective
on September 24, 2001, declaring a national emergency with respect to the
"grave acts of terrorism . . . and the continuing and immediate threat of
further attacks on United States nationals or the United States." Exec.
Order No. 13,224, 66 Fed. Reg. 49,079 (2001). In determining that actual
and threatened terrorist acts constituted "an unusual and extraordinary
threat to the national security, foreign policy, and economy of the
United States," the President invoked the powers granted by, inter alia,
IEEPA. Id. The Executive Order designated 27 terrorists, terrorist
organizations, and their supporters, and blocked their property and
property interests that have been in the United States, that subsequently
will come within the United States, or that come within the "possession
or control" of U.S. persons. Id.
In addition, the Executive Order authorized the Secretary of State, in
consultation with the Secretary of the Treasury and the Attorney
General, to designate as subject to the provisions of the order any
"foreign persons" whom he determines "have committed or . . . pose a
significant risk of committing, acts of terrorism that threaten the
security of U.S. nationals or the national security, foreign policy, or
economy of the United States." Id. The order also authorized the
Secretary of the Treasury, in consultation with the Secretary of State
and the Attorney General, to designate "persons" (defined in the order as
individuals or entities) whose property or interests in property should
be blocked because they "act for or on behalf of' or are "owned or
controlled by" designated terrorists, or they "assist in, sponsor, or
provide . . . support for," or are "otherwise associated" with them. Id.
Finally, for purposes of this opinion, the Executive Order also granted
the Secretary of the Treasury the power "to employ all powers granted to
the President by IEEPA . . ." Id. The President authorized the Secretary
of the Treasury to promulgate rules and regulations to carry out the
purposes of the order and to redelegate such functions if he so chose.
Pursuant to a delegation of authority from the Secretary of the
Treasury, OFAC has promulgated general regulations governing the various
sanctions programs. See 31 C.F.R. pt. 500; see also Wald, 468 U.S. at 226
n. 2. These regulations permit a designated individual or entity, or one
whose assets have been blocked, to seek a license from OFAC to engage in
any transaction involving blocked property. See
31 C.F.R. § 501.801-.802. In addition, the regulations establish a procedure to allow
a person to "seek administrative reconsideration" of a designation if a
party believes an error has been made. See 31 C.F.R. § 501.807.
Believing that Global Relief "may be engaged in activities that
violate" the Executive Order and IEEPA, on December 14, 2001, the
Secretary of the Treasury issued a notice temporarily blocking Global
Reliefs accounts and business records pending further investigation. The
notice informed Global Relief of its right to submit evidence to
challenge the blocking and/or request agency licenses. The record
indicates that Global Relief has filed numerous applications for licenses
since December 14, most of which have been approved by OFAC.
In situations such as this when a plaintiff is challenging an agency's
interpretation of its own regulations, we note that such an
interpretation must be given "controlling weight unless it is plainly
erroneous or inconsistent with the regulation." Stinson v. United
States, 508 U.S. 36, 45, 113 S.Ct. 1913
(1993); see also Paradissiotis
v. Rubin, 171 F.3d 983, 988 (5th Cir. 1999); Consarc Corp. v. Iraqi
Ministry, 27 F.3d 695, 701 (D.C. Cir. 1994); D.C. Precision, Inc. v.
U.S. Government, 73 F. Supp.2d 338, 344 (S.D.N.Y. 1999). This is
especially true in matters which involve foreign policy and national
security considerations. In these cases, we are "particularly obliged to
defer to the discretion of executive agencies interpreting their
governing law and regulations." Paradissiotis, 171 F.3d at 988 (citing
Haig v. Agee, 453 U.S. 280, 292, 101 S.Ct. 2766 (1981) and Miranda v.
Secretary of Treasury, 766 F.2d 1, 3-4 (1st Cir. 1985)). With this in
mind, we now turn to the substance of Global Reliefs statutory
ii) Does IEEPA grant the defendants the power to block domestic
Global Relief argues that IEEPA does not allow the government to block
or freeze the purely domestic assets of a U.S. person (which for purposes
of the statute includes a charitable entity incorporated in the U.S.).
Instead, Global Relief asserts that IEEPA only authorizes the President
to regulate property in which foreign persons have an interest. (Global
Relief Prelim. Injunction Brief at 7.) Because Global Relief is a U.S.
person and its property is exclusively domestic, plaintiff reasons that
OFAC did not have authority under IEEPA to block its assets pending
investigation. We disagree with this limited reading of IEEPA and its
As modified by the USA Patriot Act, section 1702(a)(1)(B) of IEEPA
explicitly states that the President may "block during the pendency of an
investigation . . . any acquisition, holding, withholding, use,
transfer, withdrawal, transportation, importation or exportation of . .
. any right, power, or privilege with respect to . . . any property in
which any foreign country or a national thereof has any interest by any
person . . . subject to the jurisdiction of the United States." (Emphasis
added). Congress' decision to use repeatedly the word "any" in this
section of the statute guides our interpretation of the President's power
to block during the pendency of an investigation. It is clear that
Congress intended to provide the President with sweeping power to
regulate all relevant property upon his declaration of a national
emergency. Furthermore, if Congress had intended to only authorize the
President to block foreign assets that were located within the United
States, it could have made that intention clear. However, repeated use by
Congress of the word "any" as well as its choice of the phrase "any
property, subject to the jurisdiction of the United States," without an
indication that it meant only foreign property, compels our conclusion
that the powers granted to the President under IEEPA include the ability
to block purely domestic assets of a U.S. person pending an
Having said this, however, we must turn our attention to what
constitutes an "interest" in property for purposes of IEEPA. In the
regulations promulgated by OFAC with respect to IEEPA, "interest" is
defined as "an interest of any nature whatsoever, direct or indirect"
which can include "any other property, real, personal, or mixed, tangible
or intangible, or interest or interests therein, present, future or
contingent." 31 C.F.R. § 535.311-.312, 595.310. Considering the high
level of deference we are required to give an agency's interpretation of
its own regulations, see Stinson, 508 U.S. at 45, supra, we agree with
the other courts that have interpreted IEEPA and its regulations that the
term "any interest" must be construed in the broadest possible sense. See
Wald, 468 U.S. at 224, 225-26, 233-34 (repeatedly stating that the phrase
"any interest" is to be broadly defined); Consarc Corp., 27 F.3d at
701-02 (same). Therefore, we conclude that the plain language of IEEPA
does not limit the ability to block the domestic assets of a U.S.
corporation during the pendency of an investigation when there is
evidence that a foreign country or a national thereof has any interest in
With respect to the facts of this case, both parties agree that Global
Relief is a United States citizen. However, the parties vigorously
dispute to what extent any foreign national has had an interest in Global
Relief and what the statutory consequences of that interest are. Global
Relief claims that the nationality of its directors is irrelevant since
the organization itself was incorporated in the United States. The
defendants, however, argue that IEEPA sanctions their decision to block
all of Global Reliefs assets pending an investigation because Global
Relief is "operated and controlled by foreign nationals, [uses] numerous
foreign offices, and it raises the overwhelming majority of its money for
the very purpose of sending it overseas to foreign countries and
nationals." (Defendants Brief in Opp. at 24.)
As even Global Relief has conceded, at least two of the three directors
of Global Relief were, at all relevant times, foreign nationals. The
organization's executive director and Rabih Haddad are both foreign
citizens who have resided legally in the United States for many years.
While Global Relief has attempted to downplay this foreign connection in
its briefs, we conclude that both the executive director and Haddad are
"foreign nationals," as that term is used in IEEPA. Furthermore, there
can be no dispute that both of these individuals had a direct "interest"
in the solicitation and distribution of Global Reliefs assets and that
Global Reliefs executive director was instrumental in deciding which
overseas entities and individuals were to receive Global Reliefs
contributions. In light of these facts, we are compelled to conclude that
the defendants were authorized to block the assets of Global Relief
pending an investigation pursuant to IEEPA because certain foreign
nationals, including the executive director, had, at all relevant times,
an "interest" in the operation of Global Relief. Therefore, we find that
the blocking order issued by OFAC on December 14, 2001 was not an ultra
vires act, but rather was authorized by IEEPA.
While our result comports with the plain language of IEEPA, we note
that Global Reliefs reading of the statute could completely undermine the
statutory purposes of the act. If Global Reliefs interpretation of IEEPA
were correct, then any foreign person or entity could create a
corporation under the laws of any state and then use that "domestic"
corporation to direct and fund acts of terror against the United States.
We disagree. The simple act of domestic incorporation is not sufficient
to exempt an organization from IEEPA regulation if, as the statute says,
a foreign national has "any interest" in the organization or its funds.
iii) Does IEEPA's humanitarian exception a I in this case?
The second prong of Global Reliefs statutory argument is that OFAC's
blocking order was an ultra vires action because it directly violated
IEEPA's humanitarian relief exception. This provision states:
[t]he authority granted to the President by this
section does not include the authority to regulate or
prohibit, directly or indirectly . . . donations, by
persons subject to the jurisdiction of the United
States, of articles, such as food, clothing and
medicine, intended to be used to relieve human
suffering, except to the extent that the President
that such donations (A) would seriously
impair his ability to deal with any national emergency
declared under section 1701 of this title, (B) are in
response to coercion against the proposed recipient or
donor. . . .
50 U.S.C. § 1702 (b)(2). This language makes it clear that,
notwithstanding the declaration of a national emergency, Congress
intended that IEEPA would exempt humanitarian aid donations from
executive regulation unless the President makes further findings that
humanitarian aid would seriously impair his ability to deal with the
emergency or would endanger U.S. armed forces. See Veterans Peace
Convoy, Inc. v. Schultz, 722 F. Supp. 1425, 1429 (S.D. Tex. 1988).
Nevertheless, Global Relief asserts that "the power to regulate
humanitarian activities by U.S. persons is limited to issuing blocking
orders prohibiting all U.S. persons from providing aid to specified
foreign persons or in specified foreign locales and is not a power to
single out a particular U.S. person as subversive and strip it of the
right to provide humanitarian aid to anyone." (Global Relief Prelim.
Injunction Brief at 12.) We disagree.
No doubt cognizant of the humanitarian relief exception included in
section 1702(b)(2) of IEEPA, President Bush explicitly stated in his
Executive Order that "the making of donations of the type specified in
section [1702(b)(2)] by United States persons to persons determined to
be subject to this order would seriously impair [the President's] ability
to deal with the national emergency declared in this order, and would
endanger Armed Forces . . . and [the President] hereby prohibit[s] such
donations." Exec. Order 13224, § 4. This statement clearly was
intended to trigger the presidential findings proviso of section
1702(b)(2) whereby Congress specifically authorized the President to
block or stem the flow of humanitarian relief in cases of national
This Court must be guided by what we view as the intent of Congress in
passing the humanitarian relief exception, and, in this regard, the
language of the statute speaks for itself. See United States v.
Turkette, 452 U.S. 576, 580, 101 S.Ct. 2524 (1981) (if statutory language
is unambiguous, that language must be regarded as conclusive). The
humanitarian relief exception applies explicitly to "articles, such a
food, clothing, and medicine, intended to be used to relieve human
suffering." 50 U.S.C. § 1702 (b)(2). This means that any charitable
aid that Global Relief provides both domestically and abroad falls within
the scope of the statute.
Once it has been shown that humanitarian aid is within the ambit of the
statute, Congress has explicitly determined that the President can
directly block its distribution as long as he determines that the
donations "would seriously impair his ability to deal with any national
emergency." Id. It is important to note that Congress did not include any
sort of temporal or geographic limitation on the President's ability to
block humanitarian aid. There is no statement that the President can only
block the distribution of international aid or that he can only block aid
to specific foreign persons in specified foreign locations. Instead,
Congress enacted broad, sweeping language which authorized the President
to block any and all humanitarian efforts by the targeted entity so long
as he declares that the provision of such relief would jeopardize his
ability to deal with a national emergency.
In this case, we have already noted that President Bush made the
required declaration in his Executive Order that the making of charitable
donations by the targeted entities would impair his power to deal with
the national emergency following
the September 11 attacks. OFAC then used
the powers delegated to it by the Secretary of the Treasury to block the
ability of Global Relief to dispense its humanitarian aid both
domestically and internationally. Therefore, based on our review of the
statute and the discussion above, we find that OFAC's actions in issuing
the blocking order were not ultra vires because the defendants strictly
complied with the unambiguous language of section 1702(b)(2) of IEEPA.
See Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 636-37, 72
S.Ct. 863 (1952) (an action "executed by the President pursuant to an Act
of Congress would be supported by the strongest of presumptions and the
widest latitude of judicial interpretation, and the burden of persuasion
would rest heavily upon any who might attack it.") (Jackson, J.
iv) Did the President legally delegate to OFAC the authority to
block assets during the pendency of an investigation?
In its final statutory argument in support of its motion for a
preliminary injunction, Global Relief asserts that OFAC was never legally
delegated the power to block assets "during the pendency of an
investigation" pursuant to IEEPA. Specifically, Global Relief contends
that the blocking order was ultra vires because President Bush only
delegated to the defendants in section 1(c) of his Executive Order the
power "to block" property of persons determined to be sponsoring
terrorism. Global Relief further argues that, because the defendants have
not determined that it acted for or was associated with a terrorist
organization, the blocking order was outside the authority delegated to
OFAC by the President and the Secretary of the Treasury. Additionally,
Global Relief argues that President Bush "could not have delegated the
power "to block during the pendency of an investigation' in Executive
Order 13224 even if he had expressed such an intent because President
Bush did not have that power to delegate when he signed the Executive
Order." (Global Relief Prelim. Injunction Brief at 15.) We will address
each of these arguments in turn.