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June 11, 2002


The opinion of the court was delivered by: Wayne R. Anderson, Judge.


This case is before the Court on the motion of plaintiff Global Relief Foundation, Inc. for preliminary injunctive relief pursuant to Federal Rule of Civil Procedure 65. For the following reasons, the motion is denied.


Before addressing the motion for preliminary injunction filed by the plaintiff; Global Relief Foundation ("Global Relief"), a brief description of this case is in order.

On December 14, 2001, the Federal Bureau of Investigation ("FBI") searched the headquarters of Global Relief and the home of its executive director. Pursuant to the searches, materials were seized for analysis by the FBI. Global Relief contends that both the search and seizure were unauthorized by law and unconstitutional. The defendants maintain that both the search and seizure were lawfully authorized by the Foreign Intelligence Surveillance Act and that they were constitutional. This Court agrees with the defendants.

Also on December 14, 2001, the Office of Foreign Asset Control ("OFAC") of the United States Department of the Treasury issued a blocking order freezing the financial assets of Global Relief pending the FBI's investigation of what relationship, if any, Global Relief might have to the terrorists behind the September 11, 2001 attacks on the World Trade Center and the Pentagon. Global Relief contends that the order temporarily "freezing" its assets was not authorized by statute, executive order or the Constitution. The defendants maintain that this blocking order was both lawful and constitutional. They cite the International Emergency Economic Powers Act, as amended by the USA Patriot Act, as the statutory basis for the authority to issue the blocking order. This authority was granted first to the President and then delegated by him to the Treasury pursuant to Executive Order Number 13224. Once again, this Court agrees with the defendants.

The assets seized for analysis and the funds blocked by OFAC's order have been seized and blocked "pending investigation" of Global Relief and others. Thus far, no agency of the United States government has declared or requested any forfeiture of assets to the government. Nor have any individuals or Global Relief been charged with any crimes. Hence, Global Reliefs request for a preliminary injunction is directed only to the release of funds and materials seized for investigative purposes while the investigation itself is ongoing.

To justify its emergency search and, to some extent, the blocking order, defendants have asked this Court to review materials, in camera and ex parte, without revealing them to Global Relief or its attorneys. In accordance with our order of April 5, 2002, we have reviewed materials furnished by the FBI to us and have concluded that they are relevant to the ongoing investigation and that their disclosure to Global Relief, while the investigation is pending, could undermine this investigation and others of national significance.


Global Relief began operating in 1992 as a domestic, non-profit corporation chartered and headquartered in illinois. According to its complaint, Global Relief claims to be a charitable organization that funds humanitarian relief programs throughout the world. These programs allegedly distribute food, fund schools for orphans, and provide medical services.

Global Relief characterizes itself as the largest U.S.-based Islamic charitable organization "with respect to the geographic scope of its relief programs." (Complaint ¶ 12.) As contributions to Global Relief increased (in 1995, the organization reported accepting donations totaling $431,155; by 2000, it reported nearly $3.7 million), it appears to have expanded the reach of its efforts. In 1995, it reported funding programs in Chechnya, Bosnia, Pakistan, Kashmir, and Lebanon. It reported funding additional programs in Afghanistan and Azerbaijan in 1996, Bangladesh in 1997, Iraq and Somalia in 1998, Albania, Belgium, China, Eritrea, Kosovo, and Turkey in 1999, and, eventually, Ethiopia, Jordan, Palestine, and Sierra Leone in 2000. Global Relief also has funded programs in Gaza and the West Bank. (Complaint ¶ 11.) To assist with the distribution of humanitarian aid abroad, Global Relief established regional offices in Belgium, Azerbaijan, and Pakistan. Reportedly, such offices received hundreds of thousands of dollars in contributions, in addition to the amounts reported by the headquarters in the United States. Although Global Relief has funded relief programs in the United States, over 90 percent of its donations have been sent abroad.

On September 11, 2001, terrorists attacked the United States. Individuals hijacked four commercial airliners containing passengers and crew and flew them deliberately into the two towers of the World Trade Center in New York City as well as into the Pentagon near Washington, D.C. The fourth plane was diverted from its path and crashed in rural Pennsylvania. Over 3,000 people were murdered.

On September 24, 2001, President George W. Bush declared a national emergency with respect to the "grave acts of terrorism and threats of terrorism . . . and the continuing and immediate threat of further attacks on United States nationals or the United States." Exec. Order No. 13224, 66 Fed. Reg. 49074 (2001). The President determined that the acts perpetrated on September 11 constituted "an unusual and extraordinary threat to national security, foreign policy, and economy of the United States." In light of the "pervasiveness and expansiveness of the financial foundation of terrorists," the President cited the need for financial sanctions against individuals or organizations that engage in or support terrorism throughout the world.

On December 14, 2001, pursuant to the Foreign Intelligence Surveillance Act, then-acting Deputy Attorney General Larry D. Thompson authorized the search of Global Reliefs Bridgeview, Illinois office and the residence of its executive director. The FBI's Chicago Division Joint Terrorism Task Force conducted both searches. From the Global Relief office, the FBI seized items including computers and servers, modems, a cellular phone, hand-held radios, video and audio tapes, cassette tapes, computer diskettes, a credit card imprinter, foreign currency, U.S. mail, photographs, receipts, documents, and records. From the executive director's residence, the FBI seized computers, computer diskettes, video and audio tapes, cassette tapes, date books, a cellular telephone, a camera, a palm pilot, credit cards, foreign currency, photographs, documents, records, and $13,030 in U.S. currency. Since being seized, the items removed from both the Global Relief office and the executive director's residence have been secured in FBI custody for review and analysis.

Also, on December 14, 2001, pursuant to the International Emergency Economic Powers Act and President Bush's Executive Order, OFAC issued a "Blocking Notice and Requirement to Furnish Information" to Global Relief, which "froze," until further notice, the funds, accounts, and business records in which the organization had an interest. OFAC has claimed that it acted on the basis of substantial classified and unclassified information related to Global Reliefs possible connections with terrorist organizations.

The blocking order advised Global Relief of the administrative procedures available to it should it choose to contest OFAC's action, including the right to challenge the blocking and to seek licenses to resume operations in whole or in part. Although Global Relief applied for and was granted licenses to access limited blocked funds to pay for legal expenses, salaries, payroll taxes, health insurance, rent, and utilities, it did not challenge the blocking order itself through administrative procedures.


In its motion, Global Relief has requested a preliminary injunction from this Court that would serve to enjoin the defendants from: 1) blocking or otherwise controlling Global Reliefs property; 2) barring Global Relief from doing business; 3) withholding Global Reliefs records; 4) "smearing" its name; and 5) punishing Global Reliefs donors for making donations to the corporation. (Global Relief Prelim. Injunction Brief at 2.) In this circuit, to obtain a preliminary injunction, Global Relief must show: 1) a reasonable likelihood of success on the merits; 2) the existence of an irreparable harm without the injunction; and 3) an inadequate remedy at law. Anderson v. U.S.F. Logistics (IMC), Inc., 274 F.3d 470, 474-75 (7th Cir. 2001); Re/Max North Central, Inc. v. Cook, 272 F.3d 424, 429 (7th Cir. 2001); Ty, Inc. v. Jones Group, Inc., 237 F.3d 891, 895 (7th Cir. 2001). If Global Relief satisfies this initial burden, then the Court must balance the irreparable harm to the non-moving party if the injunction is granted against the irreparable harm to the moving party if the injunction is denied. See Graham v. Medical Mutual of Ohio, 130 F.3d 293, 295 (7th Cir. 1997); Grossbaum v. Indianapolis-Marion County Bldg. Auth., 100 F.3d 1287, 1291 (7th Cir. 1996), cert. denied, 520 U.S. 1230 (1997); Publications Int'l, Ltd. v. Meredith Corp., 88 F.3d 473, 478 (7th Cir. 1996). The Court must also consider the public interest in denying or granting the injunction. See Ty, Inc., 237 F.3d at 895.

In addition to these traditional preliminary injunction requirements, Global Relief faces additional burdens. Because Global Relief is requesting that this Court order the defendants to perform certain acts (i.e. "unfreeze" its assets and return the collected documents), it is essentially seeking a mandatory preliminary injunction. As the Seventh Circuit has previously held, since a "mandatory injunction requires the court to command the defendant to take a particular action, `mandatory preliminary writs are ordinarily cautiously viewed and sparingly issued.'" Graham, 130 F.3d at 295 (citing Jordan v. Wolke, 593 F.2d 772, 774 (7th Cir. 1978). See also WA. Mack, Inc. v. General Motors Co., 260 F.2d 886, 890 (7th Cir. 1958) (finding that "mandatory injunctions are rarely issued and interlocutory mandatory injunctions are even more rarely issued, and neither except upon the clearest equitable grounds"). The burden is on Global Relief to establish that this extraordinary relief is justified.

Furthermore, by seeking injunctive relief against the decision to block its assets pending a federal investigation, Global Relief is in essence challenging the power of the Executive Branch of the United States government to conduct foreign policy. In so doing, Global Relief is asking this Court to approach the outer limit of its constitutional authority. Chief Justice Rehnquist, writing for the Court in Regan v. Wald, 468 U.S. 222, 242, 104 S.Ct. 3026 (1984), reh'g denied, 469 U.S. 912 (1984), quoted from Harisiades v. Shaughnessy, 342 U.S. 580, 589, 72 S.Ct. 512 (1952), which stated that "[m]atters related `to the conduct of foreign relations . . . are so exclusively entrusted to the political branches of government as to be largely immune from judicial inquiry or interference.'" As a general principle, therefore, this Court should avoid impairment of decisions made by the Congress or the President in matters involving foreign affairs or national security. See Haig v. Agee, 453 U.S. 280, 292, 101 S.Ct. 2766 (1981) ("Matters intimately related to foreign policy and national security are rarely proper subjects for judicial intervention"); Palestine Info. Office v. Shultz, 674 F. Supp. 910, 918 (D.D.C. 1987), aff'd, 853 F.2d 932 (1988) (same). Accordingly, we conclude that, in order to succeed on its complaint for injunctive relief, Global Relief must make an "exceptionally strong showing on the relevant [preliminary injunction] factors." Palestine Info. Office, 674 F. Supp. at 918 (citing Washington Metro. Area Transit Auth. v. Holiday Tours, Inc., 559 F.2d 841, 956 (D.C. Cir. 1977)) (emphasis in original).

With these considerations in mind, we will now turn to the merits of Global Reliefs motion for a preliminary injunction. At its core, Global Reliefs motion raises two primary arguments. First, Global Relief contends that the blocking of its assets and the "seizure" of its records and documents pending an ongoing investigation by the FBI and OFAC were acts outside the powers granted to those agencies by congressional statutes. Second, Global Relief argues that both the blocking of its assets and the search of the headquarters and the executive director's home violated numerous constitutional principles. We will address each of these arguments in turn.

I Likelihood of Success on the Merits

The threshold factor for a preliminary injunction is the likelihood of success on the merits, see Rust Env't & Infrastructure v. Teunissen, 131 F.3d 1210, 1213 (7th Cir. 1997), so we will proceed to analyze Global Reliefs claims to determine whether they are likely to succeed.

A. Global Relief Has Not Shown A Likelihood of Success On The Merits of Its Statutory Arguments

I. The Foreign Intelligence Surveillance Act

As the first part of its statutory argument offered in support of its motion for a preliminary injunction, Global Relief contends that the search of its headquarters and the subsequent search of the home of Global Reliefs executive director was an ultra vires action (which is defined as an act which is beyond the powers conferred on executive agencies by Congress). In response to this argument, the defendants have asserted that the searches conducted on December 14, 2001 were in accordance with the procedures identified in the Foreign Intelligence Surveillance Act, 50 U.S.C. § 1801 et seq., (hereinafter "FISA").

FISA was passed by Congress in 1978 to "put to rest a troubling constitutional issue" regarding the President's "inherent power to conduct warrantless electronic surveillance in order to gather foreign intelligence in the interests of national security." U.S. v. Squillacote, 221 F.3d 542, 552 (4th Cir. 2000) (citing ACLU Found. of S. California v. Barr, 952 F.2d 457, 460 (D.C. Cir. 1991)). FISA was enacted to create by statute a "secure framework by which the Executive Branch may conduct legitimate electronic surveillance for foreign intelligence purposes within the context of this Nation's commitment to privacy and individual rights." S. Rep. No. 95-604, at 15 (1978), reprinted in 1978 U.S.C.C.A.N. 3904, 3916.

When the target of the surveillance is a "United States person" (which the parties concede Global Relief is), the Foreign Intelligence Surveillance Court may issue an order authorizing the surveillance only if a FISA judge concludes there is "probable cause" to believe that the target of the surveillance is a foreign power or agent of a foreign power, that proposed "minimization procedures" are sufficient under the terms of the statute, that the certifications required by section 1823 have been made, and that the certifications are not "clearly erroneous." 50 U.S.C. § 1824 (a)(3) — (5). Under the statute, an agent of a foreign power is any person "who knowingly engages in clandestine intelligence gathering activities for or on behalf of a foreign power, which activities involve or may involve a violation of the criminal statutes of the United States." 50 U.S.C. § 1801 (b)(2)(A). FISA authorizes the federal district courts to review warrant applications and probable cause determinations made by the Foreign Intelligence Surveillance Court. See 50 U.S.C. § 1825 (d)-(g).

Furthermore, FISA provides that, when the United States intends to use in a district court information derived from a FISA search or when an aggrieved party requests discovery of information related to a FISA application, the Attorney General must file "an affidavit under oath that disclosure or an adversary hearing would harm the national security of the United States." 50 U.S.C. § 1825 (g). Attorney General John Ashcroft has filed such an affidavit in this case. This having been done, the statute requires us to "review in camera and ex parte the application, order, and such other materials relating to the physical search as may be necessary to determine whether the physical search of the aggrieved party was lawfully authorized and conducted." Id. As we noted in our April 5, 2002 ruling denying Global Reliefs motion to prevent consideration of certain materials in camera and ex parte, see Global Relief Foundation, Inc. v. O'Neill, No. 02C674, slip op. at 5 (N.D. Ill. April 5, 2002), this Court decided to consider these submissions. We have done so on an ex parte basis and have not permitted counsel for Global Relief to review the submissions with us.

With this analytical framework in mind, we now turn to the facts of the case currently before us. As was discussed above, agents of the FBI arrived at the corporate headquarters of Global Relief and the 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. Ill. 1996).

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. Id.

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 contentions.

ii) Does IEEPA grant the defendants the power to block domestic assets?

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 ...

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