Open Soc'y Justice Initiative v. Trump

510 F.Supp.3d 198

OPEN SOCIETY JUSTICE INITIATIVE, Diane Marie Amann, Milena Sterio, Margaret Deguzman, and Gabor Rona, Plaintiffs,

v.Donald J. TRUMP, President of the United States, Michael R. Pompeo, Secretary of State, United States Department of the Treasury, Steven T. Mnuchin, Secretary of the Treasury, United States Department of Justice, Jeffrey A. Rosen, Acting United States Attorney General, Office of Foreign Assets Control, and Andrea M. Gacki, Director of the Office of Foreign Assets Control, Defendants.

20 Civ. 8121 (KPF)

United States District Court, S.D. New York.

Signed January 4, 2021

Matthew M. Lavin, Pro Hac Vice, Napoli Shkolnik, PLLC, McLean, VA, Aaron Richard Modiano, Pro Hac Vice, Napoli Shkolnik, PLLC, Coconut Grove, FL, David M. Lilienstein, Katie Joy Spielman, DL Law Group, San Francisco, CA, Wendy Aline Mitchell, Napoli Shkolnik, PLLC, Los Angeles, CA, for Plaintiffs.

Geoffrey M. Sigler, Pro Hac Vice, Joshua Lipton, Pro Hac Vice, Gibson, Dunn and Crutcher LLP, Washington, DC, Heather Lynn Richardson, Lauren Margaret Blas, Gibson, Dunn and Crutcher LLP, Los Angeles, CA, for Defendants.

OPINION AND ORDER

KATHERINE POLK FAILLA, United States District Judge¹

On June 11, 2020, Defendant Donald J. Trump, in his official capacity as President of the United States, issued Executive Order 13,928, Blocking Property of Certain Persons Associated with the International Criminal Court (the "Executive Order" or the "Order"), and initial implementing regulations, 31 C.F.R. pt. 520 (the "Regulations"), purporting to exercise authority granted by the International Economic Emergency Powers Act ("IEEPA"), 50 U.S.C. §§ 1701 - 1708. Under the Order and the Regulations, designated persons associated with the International Criminal Court ("ICC") are subject to economic sanctions, and both designated persons and those who conduct certain types of prohibited interactions with designated persons may be subject to IEEPA's civil and criminal penalties for violations.

On October 1, 2020, Plaintiffs — a public interest law center and four law professors who previously have worked with two designated persons and other ICC personnel, and who desire to continue doing so but for the Executive Order — brought this action to challenge the lawfulness of the Order and the Regulations. In brief, Plaintiffs allege that the Order and the Regulations violate Plaintiffs’ rights under the First and Fifth Amendments to the United States Constitution and are ultra vires under IEEPA. They seek declaratory relief as well as injunctive relief barring Defendants from enforcing IEEPA's civil and criminal penalties against them or designating them under the Order.

Presently before the Court is Plaintiffs’ Motion for a Preliminary Injunction, which motion was filed November 3, 2020. (Dkt. #41-48). Defendants filed their opposition on November 9, 2020 (Dkt. #51-52); Plaintiffs filed their reply on November 23, 2020 (Dkt. #53). For the reasons stated below, the Court grants Plaintiffs’ motion in part.

BACKGROUND²

A. The International Criminal Court

The ICC is a permanent international court, based in The Hague, The Netherlands. (Compl. ¶ 23). It was created by a treaty, the Rome Statute of the International Criminal Court (the "Rome Statute"), to which 123 countries are currently States Parties. (Id. ). The United States is not a party. (See Jude Opp. Decl., Ex. A). The ICC may exercise jurisdiction over the investigation and prosecution of individuals accused of serious international crimes, including war crimes, crimes against humanity, and genocide. (Compl. ¶ 24). States that ratify or accede to the Rome Statute consent to the ICC's investigation, prosecution, and punishment of international crimes within the ICC's jurisdiction that are alleged to have occurred on States Parties’ territories or by their nationals. (Id. at ¶ 25). The ICC may also investigate and prosecute international crimes falling under its jurisdiction where the United Nations Security Council refers the matter to the ICC. (Id. at ¶ 26). The ICC has no independent enforcement power, but rather relies upon States Parties to arrest individuals who are subject to the arrest warrants it issues. (Id. at ¶ 27).

The Office of the Prosecutor is one of four "organs" that comprise the ICC, and it is responsible for examining alleged international crimes that fall within the ICC's jurisdiction, carrying out investigations of those crimes, and prosecuting individuals who are allegedly responsible for those crimes. (Compl. ¶ 28). Ms. Fatou Bensouda has served as the Prosecutor of the ICC and the head of the Office of the Prosecutor since 2012, after her election to that position by the States Parties. (Id. at ¶ 29). Mr. Phakiso Mochochoko has served as head of the Office of the Prosecutor's Jurisdiction, Complementarity and Cooperation Division since 2011. (Id. at ¶ 30).

In March 2020, Ms. Bensouda received authorization through the ICC's internal processes to open an investigation into certain crimes allegedly committed in Afghanistan, a State Party. (Compl. ¶ 31(o)). The investigation encompasses crimes committed since 2003, including crimes allegedly committed by the Taliban, Afghan security forces, and U.S. and allied personnel, both in Afghanistan and in the territory of other States Parties. (Id. ; see also Renzler Decl., Ex. 7). The United States objects to such attempts to assert ICC jurisdiction over U.S. and allied personnel. (See Jude Opp. Decl., Ex. A).

B. The International Emergency Economic Powers Act

IEEPA grants the President certain powers once the President has declared a national emergency with respect to "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." 50 U.S.C. § 1701(a). When the President has declared such an emergency, the President may "block ..., regulate, ... prevent or prohibit, any acquisition, ... use, transfer, ... 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." Id. § 1702(a)(1)(B). However, the President may not "regulate or prohibit, directly or indirectly ... any postal, telegraphic, telephonic, or other personal communication, which does not involve a transfer of anything of value," or the importation or exportation of "any information or informational materials." Id. § 1702(b)(1) & (3).

The President may exercise this authority under IEEPA by issuing an executive order forbidding the dealing in property or interests in property of certain persons, and authorizing federal agencies to "designate" those persons subject to such proscriptions. (Compl. ¶ 60). Designation results in the designated person's inclusion on the Specially Designated Nationals List maintained by the Office of Foreign Assets Control ("OFAC") in the Department of the Treasury. (Id. at ¶ 61). Orders issued pursuant to IEEPA forbid "deal[ing] in" a designated person's "property or interests in property," a prohibition that OFAC has interpreted broadly such that virtually any economic interaction with a designated person is forbidden. (Id. at ¶ 62).

Those who violate an order issued under IEEPA are subject to a civil penalty of the greater of $307,922 or twice the value of the blocked transaction. See 50 U.S.C. § 1705(a) - (b) ; 31 C.F.R. § 520.701 ; 85 Fed. Reg. 19884-02 (2020). When determining whether to issue a civil penalty, OFAC follows a set process outlined in the agency's regulations. See generally 31 C.F.R. pt. 501, App. A, Economic Sanctions Enforcement Guidelines. Those who commit, attempt to commit, or conspire to commit a willful violation are also subject to criminal fines of up to $1,000,000 and, if a natural person, up to 20 years’ imprisonment. 50 U.S.C. § 1705(c). Of potential significance to the instant motion, being subjected to the enforcement of IEEPA's civil and criminal penalties is separate and distinct from being designated a sanctioned person under IEEPA. (Compl. ¶ 64).

C. Executive Order 13,928 and Its Implementing Regulations

The Executive Order issued June 11, 2020, purports to implement authority granted to the President by IEEPA. See Executive Order 13,928. The Order declares a national emergency with respect to "any attempt by the ICC to investigate, arrest, detain, or prosecute any United States personnel without the consent of the United States, or of personnel of countries that are United States allies and who are not parties to the Rome Statute or have not otherwise consented to ICC jurisdiction." Id.

Section 1(a)(i) of the Executive Order blocks and restricts transfer of the property and interests in property that are in the United States, or that come within the possession or control of any United States person, of:

any foreign person determined by the Secretary of State, in consultation with the Secretary of the Treasury and the Attorney General:

[i] to have directly engaged in any effort by the ICC to investigate, arrest, detain, or prosecute any United States personnel without the consent of the United States;

[ii] o have directly engaged in any effort by the ICC to investigate, arrest, detain, or prosecute any personnel of a country that is an ally of the United States without the consent of that country's government;

[iii] to have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, any activity described in subsection (a)(i)(A) or (a)(i)(B) of this section or any person whose property and interests in property are blocked pursuant to this order; or

[iv] to be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose property and

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