Opinion

Kindhearts for Charitable Humanitarian Development, Inc. v. Geithner

647 F. Supp. 2d 857
2009 U.S. Dist. LEXIS 80475
2009 WL 2514057

Court: District Court, N.D. Ohio
Filed: Aug 18, 2009
Status: Published
Author: Carr
On the bench: James G. Carr
Cited by: 17 cases
Authority: More cited than 65.5%

explaining the errors of the other district court opinions and rejecting the argument that the seizure of assets under EO 13,224 is not a “seizure” for Fourth Amendment purposes

How later courts described this case

explaining the errors of the other district court opinions and rejecting the argument that the seizure of assets under EO 13,224 is not a “seizure” for Fourth Amendment purposes
holding that there is no general “reasonableness” approach to warrantless seizures
holding that the “special needs” exception did not apply to very similar facts
noting that OFAC had provided “an unclassified three- page summary of the classified evidence” to the entity under investigation

Written by the judges who cited it.

The opinion

ORDER

JAMES G. CARR, Chief Judge.

Plaintiff KindHearts for Charitable Humanitarian Development, Inc. (KindHearts), an Ohio corporation, challenges a provisional determination by the Office of Foreign Assets Control [OFAC] of the United States Treasury Department that plaintiff is a Specially Designated Global Terrorist [SDGT]. KindHearts also challenges the block OFAC placed on plaintiffs assets pending a full investigation.

OFAC alleges that KindHearts provides material support to Hamas, which is also an SDGT. OFAC’s authority to designate SDGTs and block the assets of entities under investigation for supporting terrorism stems from the International Emergency Economic Powers Act [IEEPA], 50 U.S.C. § 1701-06 and Executive Order 13224 [E.0.13224].

KindHearts alleges that OFAC’s actions are unconstitutional because: 1) OFAC’s block is an unreasonable seizure in violation of the Fourth Amendment; 2) provisions authorizing OFAC to designate SDGT and block assets pending investigation are void for vagueness under the Fifth Amendment; 3) OFAC denied KindHearts procedural due process before provisionally determining it to be an SDGT and blocking its assets; and 4) OFAC has unconstitutionally restricted plaintiffs access to the resources it needs to mount a defense. KindHearts further claims that OFAC blocked KindHearts’ assets without proper statutory authorization.

KindHearts asks this court to lift the OFAC blocking order or, alternatively, to require OFAC to provide KindHearts with adequate process.

The defendants — the Secretary of the Treasury, Director of OFAC, and Attorney General — are United States government officials sued in their official capacities. This court

sua sponte

substitutes as defendants Timothy Geithner, Secretary of the Treasury, and Eric H. Holder, Attorney General, for former Treasury Secretary Henry M. Paulson and former Attorney General Michael B. Mukasey, respectively. Defendants contest plaintiffs constitutional and statutory claims, and argue that claims arising from OFAC’s provisional determination that KindHearts is an SDGT are not ripe for this court’s review.

Pending are plaintiffs motion for partial summary judgment under Rule 56 of the Federal Rules of Civil Procedure [Doc. 31] and defendants’ motion to dismiss under Rule 12(b)(6) or, in the alternative, for summary judgment on all counts under Rule 56. [Doc. 36],

Background

KindHearts, a Toledo-based non-profit corporation, was incorporated on January 22, 2002, under Ohio law. Its stated goal is to provide humanitarian aid without regard to religious or political affiliation.

Khaled Smaili founded KindHearts after OFAC shut down several Muslim-affiliated charities which, like KindHearts had as their stated objectives humanitarian relief in the Middle East and elsewhere. KindHearts contends that from its inception, its officers and directors took great care to ensure it did not fund any designated terrorist or terrorist-related entities or otherwise violate federal laws regarding

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designated terrorists. It sought guidance from the Treasury Department, and implemented the Treasury’s voluntary guidelines for charitable organizations.

On February 19, 2006, OFAC froze all of KindHearts’ assets pending investigation into whether it was subject to designation under IEEPA and E.O. 13224. More than a year later, on May 25, 2007, OFAC informed KindHearts it had provisionally determined to designate it a SDGT.

Statutory and Regulatory Framework

The Executive initially used the Trading With the Enemy Act [TWEA], 50 App. U.S.C. §§ 1-44, enacted in 1917, to impose sanctions and embargoes on foreign nations. In 1977, Congress amended the TWEA and enacted the IEEPA. The IEEPA requires the President to declare a national emergency 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.” The pertinent sections of the IEEPA are 50 U.S.C. § 1701 and 1702:

§ 1701. Unusual and extraordinary threat; declaration of national emergency; exercise of Presidential authorities

(a) Any authority granted to the President by section 1702 of this title 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.

(b) The authorities granted to the President by section 1702 of this title may only be exercised to deal with an unusual and extraordinary threat with respect to which a national emergency has been declared for purposes of this chapter and may not be exercised for any other purpose. Any exercise of such authorities to deal with any new threat shall be based on a new declaration of national emergency which must be with respect to such threat.

§ 1702. Presidential authorities

(a)(1) At the times and to the extent specified in section 1701 of this title, the President may, under such regulations as he may prescribe, by means of instructions, licenses, or otherwise—

(A) investigate, regulate, or prohibit—

(i) any transactions in foreign exchange,

(ii) transfers of credit or payments between, by, through, or to any banking institution, to the extent that such transfers or payments involve any interest of any foreign country or a national thereof,

(iii) the importing or exporting of currency or securities, by any person, or with respect to any property, subject to the jurisdiction of the United States;

(B) investigate, block during the pendency of an investigation, 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. §§ 1701-1702 .

On September 24, 2001, President Bush issued E.O. 13224, declaring a national emergency with respect to “grave acts and threats of terrorism.” He invoked his au

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thority under the IEEPA, authorizing the Secretary of Treasury, in consultation with the Secretary of State and Attorney General, to designate “persons” (defined 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 because they “assist in, sponsor, or provide financial, material or technological support for, or financial or other services to or in support of’ or are “otherwise associated” with them.

Individuals or entities designated under E.O. 13224 are labeled “Specially Designated Global Terrorists.” In § 10 of the Executive Order, the President states that under the Order no prior notice of a listing or designation needs to be provided to those with a presence in the United States because of the targeted organization’s ability to transfer funds or assets instantaneously, which would render the blocking measures ineffectual.

In October, 2001, the Patriot Act amended the IEEPA. It added the phrase “block pending investigation” after the word “investigate” in 50 U.S.C. § 1702 (a)(1)(B). The amendment permitted the Treasury Secretary to impose all the blocking effects of a designation, including freezing an organization’s assets indefinitely and criminalizing all its transactions, without designating the organization a SDGT. The Treasury only needs to assert that it is investigating whether the entity should be designated. The amendment also provided that an agency record containing classified information could be “submitted to the reviewing court

ex parte

and

in camera.”

Designation as a specially designated global terrorist immediately results in the blocking of the designee’s property and interests in property within the United States or in the control of United States persons. It also prohibits all transactions with designated entities, including making or receiving any contribution of funds, goods or services to or for the benefit of those persons. Executive Order 13224 specifically prohibits all humanitarian donations.

The Treasury Department promulgated regulations implementing E.O. 13224 on June 6, 2003. The regulations set forth the procedures for imposing civil and criminal penalties on United States persons who engage in any transaction with any entity that has been designated or blocked pending investigation. With respect to a designation, 31 CFR § 501.807 permits designated entities to seek administrative reconsideration by OFAC after they have been designated and had their property frozen.

OF AC’s Block Pending Investigation of KindHearts

On February 19, 2006, OFAC blocked all of KindHearts’ assets and property pending investigation into whether it was subject to designation under E.O. 13224. On the same day it blocked KindHearts’ assets, the government executed search warrants at KindHearts’ Toledo headquarters and the residence of its President, Khaled Smaili. It removed all KindHearts’ records, computers and several boxes of publications and documents. Before executing those search warrants, the Department of Justice obtained two grand jury subpoenas

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requiring: 1) Ernst

Young to produce documents relating to KindHearts and 2) a member of KindHearts’ Board of Directors to produce all records of KindHearts from January 1, 2002, to February 17, 2006.

On issuing the block, OFAC sent a “blocking notice” to KindHearts. The notice stated:

You are hereby notified that all property and interests in property of KindHearts ... including its U.S. representative office and all other offices worldwide, are blocked pending investigation into whether KindHearts is subject to designation pursuant to Executive Order 13224 ... for being controlled by, acting for or on behalf of, assisting in or providing financial or material support to, and/or otherwise being associated with Hamas.

The notice also explained KindHearts did not receive prior notice of OFAC’s determination to block its assets pending investigation because it could have transferred its funds and assets, thus rendering the sanctions ineffectual. It stated that if KindHearts believed OFAC took this action in error, and wanted to challenge it, it could send a letter to the attention of the Director of OFAC explaining KindHearts’ views and providing evidence.

That same day, the Treasury Department posted a press release on its website announcing the blocking of KindHearts’ assets. The press release also stated that KindHearts’ officials and fundraisers had “coordinated with Hamas leaders and made contributions to Hamas-affiliated organizations” including such organizations in the West Bank and Lebanon. The press release asserted that KindHearts was founded to replace the Hamas-affiliated Holy Land Foundation for Relief and Development [HLF] and the al-Qaida-affiliated Global Relief Foundation [GRF].

As a result of the block, KindHearts’ assets and property, including about one million dollars in bank accounts, became frozen indefinitely. Through its blocking order, OFAC effectively shut the organization down.

In April, 2006, KindHearts’ attorney, Jihad Smaili [brother of Khaled Smaili], filed a letter in response to the block, but OFAC failed to respond to it. On November 29, 2006, KindHearts counsel requested a copy of the full administrative record being used by OFAC in its investigation. It received no response.

OFAC’s Provisional SGDT Designation of KindHearts

On May 25, 2007, more than a year after Jihad Smaili’s initial letter, and more than six months after his follow-up letter, OFAC notified KindHearts that OFAC had provisionally determined to designate KindHearts a specially designated global terrorist. In that letter it for the first time acknowledged receiving KindHearts’ challenge to the block pending investigation. OFAC’s letter stated,

We have received Jihad Smaili’s April 24, 2006 letter to ... OFAC requesting reconsideration of OFAC’s decision to block the property and property interests of KindHearts ... pending investigation into whether KindHearts should be designated as a Specially Designated Global Terrorist ... Since receipt of that letter, OFAC has completed its investigation into whether KindHearts should be designated as an Specially Designated Global Terrorist and has provisionally determined that designation is appropriate.

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Accompanying OFAC’s letter were thirty-five unclassified and non-privileged documents on which, according to OFAC, it had relied in making the provisional determination. OFAC acknowledged it also relied on other “classified and privileged documents obtained to date ... not authorized for disclosure, including material obtained or derived pursuant to” the Foreign Intelligence Surveillance Act [FISA], 50 U.S.C. § 1801 et seq.

The OFAC letter also included an unclassified three-page summary of the classified evidence. It provided no explanation of the specific charges it was considering against KindHearts or why it thought the evidence supported a potential designation.

The letter stated KindHearts could “present to OFAC any evidence or other information that it [wanted] OFAC to consider before making a final determination with respect to designation.” It explained “OFAC [would] consider any such information, as well as the information described above in making a final determination.” It also noted that if it “decide[d] to consider any additional unclassified, non-privileged materials in making this determination, it [would] advise KindHearts of that fact, provide KindHearts with copies of the materials, and give KindHearts an opportunity to respond to them.” OFAC initially gave KindHearts thirty days to respond to its provisional determination.

KindHearts sought access to the full classified and unclassified administrative record to defend itself, and an extension of time in which to respond to OFAC’s unclassified submission.

On June 14, 2007, KindHearts requested access to its own records in the government’s possession. OFAC waited two months, until August 14, 2007, before notifying KindHearts’ counsel that OFAC possessed only a few of the records. The United States Attorney’s office had the rest of the records. That Office refused to provide KindHearts with a copy of the documents.

On June 25, 2007, KindHearts’ counsel sent OFAC a twenty-eight page preliminary submission in which KindHearts attempted to, in its words, “guess at and address OFAC’s concerns.” It attached to that a 1369-page submission of supporting evidence. OFAC never responded to this submission.

On June 27, 2007, KindHearts asked OFAC to perform a declassification review of the classified evidence on which i.t relied in issuing the blocking notice. In a letter dated August 10, 2007, OFAC agreed with KindHearts’ request, and stated it would give KindHearts thirty days after the com

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pletion of declassification review to submit a response. OFAC informed counsel that it could not state when review would be completed, and denied KindHearts’ counsel interim access to classified information.

OFAC reported no progress on the declassification review in the fourteen months between its June 27, 2007, agreement to conduct declassification review and the filing of this lawsuit. After KindHearts filed suit, the government, during a telephone call with KindHearts’ counsel on October 20, 2008, indicated it could complete the declassification review within thirty days.

On August 13, 2007, KindHearts requested further clarification of the charges against it and an extension of time until forty-five days after the completion of the declassification review. KindHearts stated it needed the extension to receive meaningful process.

On August 16, 2007, OFAC informed KindHearts that it could contact KindHearts’ employees; it also stated that any KindHearts documents in possession of such employees constituted blocked property. Use of such documents would require a license from OFAC, and existing regulations require counsel to provide basic identifying information regarding the property.

On October 26, 2007, and December 20, 2007, KindHearts’ counsel objected to OFAC’s requirement that it identify blocked property in its possession. Counsel did not request a license to use blocked property.

On December 26, 2007, OFAC issued a license allowing KindHearts counsel to receive copies of blocked documents necessary for them to provide legal services to KindHearts.

For over two years, OFAC did not allow KindHearts to use its own funds to pay attorneys’ fees. OFAC asserted KindHearts could pay for legal services only if those payments did not originate from its blocked funds. Immediately after the block, Jihad Smaili, KindHearts’ attorney, corresponded with OFAC regarding the release of blocked funds to pay attorney fees, but OFAC maintained that KindHearts could only pay for attorneys from “fresh funds” (funds raised abroad), or by obtaining a license to create a legal defense fund. Smaili resigned, and Lynne Bernabei, of the law firm Bernabei & Wachtel PLLC, and Professor David Cole applied for and were granted licenses to represent KindHearts. OFAC denied them funding from blocked assets. In late June 2008, Bernabei & Wachtel sought the assistance of the ACLU.

As of June, 2008, after its policy on attorneys fees was challenged as unconstitutional in other litigation, OFAC, after adopting a policy change, permits KindHearts to use a limited amount of its funds to pay for legal expenses. It can pay up to two lawyers $7000 each for proceedings at the administrative level, and an additional $7000 each for trial level proceedings. It can pay up to $5000 each for appellate proceedings. In March, 2009, after Bernabei & Wachtel applied for funding, OFAC granted $27,040 from KindHearts’ blocked funds for legal fees.

In December, 2008, OFAC produced declassified versions of the block and provisional determination memoranda. Since then, the government has declassified portions of block exhibits. In January, 2009, it declassified several portions of several paragraphs in the block memorandum. On March 13, 2009, OFAC declassified one of several bases for its block and threatened designation.

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Since February 19, 2006, when OFAC first notified KindHearts of the block pending investigation, OFAC has not designated KindHearts a SDGT.

For almost three years OFAC has blocked KindHearts’ property and property interests and criminalized all transactions with it. OFAC has effectively shut KindHearts down.

Standard of Review

Both plaintiff and defendants move for summary judgment. A court must enter summary judgment “against a party who fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.”

Celotex Corp. v. Catrett, 477

U.S. 317, 322, 106 S.Ct. 2548 , 91 L.Ed.2d 265 (1986). The moving party bears the initial responsibility of informing the district court of its motion’s basis, and identifying the record’s portions that demonstrate the absence of a genuine issue of material fact.

Id.

at 323 , 106 S.Ct. 2548 . The nonmoving party “must [then] set forth specific facts showing that there is a genuine issue for trial.”

Anderson v. Liberty Lobby, Inc., 477

U.S. 242, 250, 106 S.Ct. 2505 , 91 L.Ed.2d 202 (1986) (quoting Fed.R.Civ.P. 56(e)).

In deciding the motion for summary judgment, the court will believe the non-moving party’s evidence as true, it will resolve all doubts against the non-moving party, it will construe all evidence in the light most favorable to the non-moving party, and it will draw all inferences in the non-moving party’s favor.

Eastman Kodak Co. v. Image Technical Servs., Inc.,

504 U.S. 451, 456 , 112 S.Ct. 2072 , 119 L.Ed.2d 265 (1992).

Defendants move to dismiss plaintiffs claims under Rule 12(b)(6). A court “must accept all well-pleaded factual allegations of the complaint as true and construe the complaint in the light most favorable to the plaintiff.”

Inge v. Rock Fin. Corp.,

281 F.3d 613 , 619 (6th Cir.2002) (citing

Turker v. Ohio Dep’t of Rehab. & Corr.,

157 F.3d 453, 456 (6th Cir.1998));

Gazette v. City of Pontiac,

41 F.3d 1061, 1064 (6th Cir.1994). The court is not bound to accept as true unwarranted factual inferences,

Morgan v. Church’s Fried Chicken,

829 F.2d 10, 12 (6th Cir.1987), or legal conclusions unsupported by well-pleaded facts.

Teagardener v. Republic-Franklin, Inc. Pension Plan,

909 F.2d 947, 950 (6th Cir.1990).

A Rule 12(b)(6) motion to dismiss is directed solely to the complaint and any exhibits attached to it.

Roth Steel Products v. Sharon Steel Corp.,

705 F.2d 134, 155 (6th Cir.1983). The merits of the claims are not at issue. Consequently, a complaint will be dismissed pursuant to Rule 12(b)(6) only if there is no law to support the claims made, the facts alleged are insufficient to state a claim, or on the face of the complaint there is an insurmountable bar to relief.

See Rauch v. Day & Night Mfg. Corp.,

576 F.2d 697, 702 (6th Cir.1978).

Discussion

1. Fourth Amendment

KindHearts argues that OFAC’s block pending investigation is an unreasonable seizure in violation of the Fourth Amendment. In blocking KindHearts’ assets, OFAC acted without a prior judicial warrant. It purports, however, to have acted on reasonable suspicion that KindHearts met the criteria for designation under E.O. 13224.

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Neither the IEEPA nor E.O. 13224 requires a warrant or probable cause to effect a block pending investigation. The government argues that the economic sanctions authorized by that statute and the Executive Order are not “seizures” and therefore the Fourth Amendment is inapplicable Alternatively, the government disputes the contention that traditional warrant and probable cause requirements apply to blocks pending investigation.

A. The Block Pending Investigation is a Fourth Amendment “Seizure”

The first inquiry is whether OFAC’s block is a “seizure” in Fourth Amendment terms. If the block is not a “seizure,” the Fourth Amendment does not constrain the government’s conduct.

The Fourth Amendment protects “the right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures.” U.S. Const, amend. IV. The government seizes property when it creates “some meaningful interference with an individual’s possessory interests in that property.”

Soldal v. Cook County, Ill,

506 U.S. 56, 61 , 113 S.Ct. 538 , 121 L.Ed.2d 450 (1992);

See also U.S. v. Wunsch,

84 F.3d 1110 (9th Cir.1996) (invalidating court’s local disciplinary rule requiring lawyers to “abstain from all offensive personality” because it could “refer to any number of behaviors” and it would be “impossible to know when such behavior would be offensive enough to invoke the statute.”).

i. “Services”

Plaintiff argues that the term “services” as it appears in E.O. 13224, §§ 1-2 is unconstitutionally vague. The Treasury Regulations do not provide a concise definition of “services,” but they do contain a non-exhaustive list of examples: “legal, accounting, financial, brokering, freight forwarding, transportation, public relations, or other services.” 31 C.F.R. § 594.406 .

Other courts have concluded that the term “services” in E.O. 13324 is not unconstitutionally vague. In

Humanitarian Law Project, supra,

463 F.Supp.2d at 1063 , the court held that the term “services” in the E.O. 13224 is not vague be-

cause it is a “word of common understanding and one that could not be used for selective or subjective enforcement.” Despite the fact that the regulations list examples in place of an exact definition, the court concluded that “any given individual would be able to distinguish when he or she was providing a ‘service’ to a designated terrorist group, as opposed to engaging in independent activity.”

Id.; see also Al Haramain, supra,

585 F.Supp.2d at 1270 (The term “services” in E.O. 13224 is not unconstitutionally vague because the whole phrase, “services to or in support of’ an SDGT “implies cooperation between the two entities, as opposed to independent advocacy.”).

Courts have also upheld the term “services” against vagueness challenges in other contexts.

See, e.g., Al Haramain, supra,

585 F.Supp.2d at 1269-1270 (upholding “services” as it appears in IEE-PA);

U.S. v. Lindh,

212 F.Supp.2d 541, 547 (E.D.Va.2002) (upholding “services” in a criminal case).

Humanitarian Law Project v. Mukasey,

509 F.3d 1122, 1136 (9th Cir.2007), the court concluded that the “service” in the Antiterrorism and Effective Death Penalty Act of 1996 [AEDPA] is unconstitutionally vague. The AEDPA, however, expressly defined “services” to include “expert advice or assistance.”

Id.

The court ruled the terms “expert advice or assistance” to be unconstitutionally vague because the terms reaches protected First Amendment activity, such as training in “how to lobby or petition representative bodies such as the United nations.”

Id.

The court concluded that the phrase “expert advice or assistance” was unconstitutionally vague, and that the term “services” was unconstitutionally vague because the term includes “expert advice or assistance.”

Id.

at 1135-1136 .

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The term “service” in E.O. 13224 is not unconstitutionally vague. The common meaning of the word sufficiently constrains executive discretion. When read in context, “services to or in support of,” the term clearly requires a collaborative relationship with an SDGT; independent advocacy is not covered. Moreover, neither the E.O. nor the Treasury Regulations expressly extend the term “services” to any protected area of speech, making the Ninth Circuit’s reasoning in

Humanitarian Law Project

regarding the AEDPA inapplicable here.

ii. “Material Support”

Plaintiffs assert that the term “material support” is unconstitutionally vague. Neither the Executive Order nor the Treasury regulations provide a definition of this term. To construe the statute, courts may look to how other statutes, regulations, and case law define this term.

See Jordan, supra,

341 U.S. at 229-230 , 71 S.Ct. 703 .

The Immigration and Naturalization Act [INA], 8 U.S.C. § 1182 (a)(3)(B), bars aliens who “engage in terrorist activity,” including those who “afford material support” to terrorists from receiving visas or entering the United States. The statute provides several examples of “material support,” including “a safe house, transportation, communications, funds, transfer or other material financial benefit, false documentation or identification, weapons (including chemical, biological, or radiological weapons), explosives, or training.”

Id.

at § 1182(a)(3)(B)(iv)(VI).

Courts have defined and applied the term “material support” from the INA using the plain meaning of the words. Thus, “material” has been held to mean “significant” or “essential” and “support” has been held to mean “sustenance or maintenance; esp., articles such as food and clothing that allow one to live in the degree of comfort to which one is accustomed.”

Singh-Kaur v. Ashcroft,

385 F.3d 293, 298 (3d Cir.2004) (construing “material support” in 8 U.S.C. § 1182 (a)(3)(B)(iv)(VI)) (quoting

Black’s Law Dictionary

991, 1453 (7th Ed.1999)) Though not addressing a vagueness challenge to the statute, the court concluded that “material support” clearly encompassed the claimant’s actions, which included providing food and shelter to individuals the claimant knew had committed terrorist activities.

Id.

at 299 .

The term “material support” also appears in the AEDPA, 18 U.S.C. § 2339A. Subsection (b)(1) defines “material support or resources” to mean

any property, tangible or intangible, or service, including currency or monetary instruments or financial securities, financial services, lodging, training, expert advice or assistance, safehouses, false documentation or identification, communications equipment, facilities, weapons, lethal substances, explosives, personnel (1 or more individuals who may be or include oneself), and transportation, except medicine or religious materials.

That two different federal statutes define “material support” somewhat differently does not, as plaintiffs contend, indicate that the statute is vague. The definitions in the INA and AEDPA do not set forth an exhaustive list of examples. In addition to specific examples like “weapons, lethal substances [and] explosives,” the definition in the AEDPA includes general terms like “any property, tangible or intangible, or service.” 18 U.S.C. § 2339A(b)(l). The definition in the INA uses the term “including” before the enumerated examples, indicating that Congress “intended to illustrate a broad concept rather than narrowly circumscribe a term with exclusive categories.”

Singh-Kaur, supra,

385 F.3d

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at 298. Even if the two statutes differ in the examples they list, there is substantial overlap: both list safe houses, funds, false documentation, financial services and weapons as examples of “material support.”

Plaintiffs vagueness challenge to “material support” fails. The INA, AED-PA, existing case law and common meaning provide a “broad concept” of material support that is sufficiently clear. Statutes “need not define with mathematical precision the conduct forbidden.”

Columbia Natural Res., supra,

58 F.3d at 1108. Plaintiff, furthermore, must show that the statute is vague in all its potential applications to succeed in its facial challenge. Because existing statutes and case law identify a clear core of activities that constitute “material support”—including the giving of funds, which plaintiff allegedly did—plaintiffs facial challenge fails.

iii. “Otherwise associated with”

Plaintiffs also find unconstitutional vagueness in the term “otherwise associated with” in E.O. 13224, § 1. OFAC regulations have recently defined this phrase to mean “(a) To own or control [an SDGT]; or (b) To attempt, or to conspire with one or more persons, to act for or on behalf of or to provide financial, material, or technological support, or other financial services, to” [an SDGT]. 31 C.F.R. § 594.316 .

Plaintiff alleges that the phrase “otherwise associated with” arguably encompasses First Amendment protected speech and association. The recently-adopted definition in 31 C.F.R. § 594.316 , however, clarifies the phrase and limits its applicability to protected speech and conduct. Since the regulation was adopted, courts have twice rejected arguments identical to the plaintiffs.

See Al Haramain, supra,

585 F.Supp.2d at 1270 (term “otherwise associated with” as defined in § 594.316 is not unconstitutionally vague);

Humanitarian Law Project v. U.S. Dept. of Treasury,

484 F.Supp.2d 1099, 1106 (C.D.Cal.2007) (terms “on behalf of’ and “to attempt, or to conspire” in § 594.316 are themselves sufficiently clear and clarify the meaning of “otherwise associated with”).

Plaintiff notes that § 594.316 includes the terms “services” and “material support,” which it alleges are unconstitutionally vague. For the reasons described above, neither term is vague either as it appears in E.O. 13224 or 31 C.F.R. § 594.316 . Neither, therefore, makes the term “otherwise associated with” unconstitutionally vague.

iv. Lack of a Scienter Requirement

Plaintiff claims, and the defendant does not dispute that OFAC may designate a targeted entity for providing “material support,” providing “services” or “otherwise associating] with” an SDGT without showing that the targeted entity knew the recipient of its resources was an SDGT or that the targeted entity knew the resources would be used for illegal purposes. Plaintiff argues that this lack of a scienter requirement renders E.O. 13224 unconstitutionally vague.

Lack of a scienter requirement does not make an otherwise clear statute unconstitutionally vague. Even criminal statutes are not unconstitutional where the legislature did not make intent to violate the statute an element of the crime.

Lambert v. California,

355 U.S. 225, 228 , 78 S.Ct. 240 , 2 L.Ed.2d 228 (1957) (“There is wide latitude in the lawmakers to declare an offense and to exclude elements of knowledge and diligence from its definition.”). Punishing “a person for an act as a crime when ignorant of the facts making it so” is not a denial of due process of law.

Williams v. North Carolina,

325 U.S. 226, 238 , 65 S.Ct. 1092 , 89 L.Ed. 1577 (1945). Although “a scienter requirement may

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mitigate a law’s vagueness, especially with respect to the adequacy of notice to the complainant that his conduct is proscribed,”

Hoffman Estates, supra,

455 U.S. at 499 , 102 S.Ct. 1186 , lack of such requirement does not make the statute vague.

In this case, the absence of a scienter requirement does not make OF AC’s authority unconstitutionally vague.

4. Procedural Due Process

KindHearts asserts a due process challenge to OFAC’s provisional designation of it as a SDGT.

KindHearts claims that the statute on its face does not accommodate, and in any event, OFAC failed to provide constitutionally mandated due process. As a result, according to KindHearts, it was not given — and, in its view, even yet has not received — constitutionally adequate notice of the basis and reasons for the blocking order. It also asserts that the government has failed to provide an opportunity to be heard in response to that order and the deprivation of its assets.

For the reasons that follow, I reject KindHearts’ contentions regarding facial invalidity for want of an express description of process. I conclude, however, that the government’s actions regarding the blocking order failed to provide the two fundamental requirements of due process: meaningful notice and opportunity to be heard.

Mathews v. Eldridge,

424 U.S. 319, 333, 348 , 96 S.Ct. 893 , 47 L.Ed.2d 18 (1976).

I find, though, that I presently cannot determine the extent to which KindHearts has been prejudiced by the violation of its constitutional rights.

I also conclude that the due process challenge to the provisional SDGT designation is not ripe for adjudication.

A. Asset Freeze — Facial Challenge

KindHearts contends that IEEPA § 1702(a)(1)(B) is unconstitutional on its face because it fails to include procedural safeguards. The law does not require notice, an opportunity to be heard or pre- or post-deprivation process. A provision of the Patriot Act amended the IEEPA and authorized OFAC to block an individual’s or organization’s assets based on its assertion that the individual or organization is under investigation.

OFAC can thus freeze an American corporation’s assets just by announcing that the corporation is under investigation — under the statute it does not need to provide any process to that corporation.

§ 1702(a)(1)(B) states:

At the times and to the extent specified in § 1701 of this title, the President may, under such regulations as he may prescribe, by means of instructions, licenses, or otherwise — (B) investigate, block during the pendency of an investigation, 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[.]

KindHearts argues the government must provide notice and an opportunity to be heard by a neutral tribunal. While it agrees that the government does not always have to provide pre-deprivation process, it maintains that the government

*898

must afford it prompt post-deprivation process.

The government, in response, emphasizes the flexible nature of due process requirements, and states that courts must consider the governmental interest in national security in addition to harm to private interests and risk of erroneous deprivation. The government’s interest in national security, it contends, is paramount.

KindHearts correctly contends that the IEEPA contains no procedural protections. That does not mean that it meets the

Salerno

“no set of circumstances” test. 481 U.S. at 745 , 107 S.Ct. 2095 .

Under

Salerno ,

“a plaintiff can only succeed in a facial challenge by establishing that no set of circumstances exist under which the Act would be valid,

ie.,

that the law is unconstitutional in all of its applications.”

Washington State Grange v. Washington State Republican Party,

552 U.S. 442 , 128 S.Ct. 1184, 1190 , 170 L.Ed.2d 151 (2008).

U.S. v. Al-Arian,

308 F.Supp.2d 1322 (M.D.Fla.2004), the court upheld the constitutionality of the IEEPA because the statute primarily applies to foreign organizations. The court reasoned that facial analysis of the statute should include the statute’s application to foreign organizations and to organizations without a substantial connection to the United States. It stated, “[i]n such limited and exceptional circumstances ... the facial analysis of a statute, like AEDPA or IEEPA, should include application to foreign organizations and individuals without a substantial connection to the United States.”

Id.

at 1346 . It rejected the notion that its analysis would “eviscerate the doctrine of facial invalidity.”

Id.

It instead explained that its analysis prevented it “from intruding into an area that ... belonged] to the domain of political power.”

Id.

No other court has explicitly addressed the constitutionality of the IEEPA under the

Salerno

“no set of circumstances” test. In

Global Relief Foundation, Inc., supra,

207 F.Supp.2d at 793 , plaintiff argued the IEEPA did not apply to the domestic assets of a United States corporation. Plaintiff did not challenge the constitutionality of the statute under

Salerno .

Holy Land Foundation, supra,

219 F.Supp.2d at 67 , plaintiff argued that under the IEE-PA, the President can only block property in which a foreign country or national has an interest that is “legally enforceable.” Again, plaintiff did not challenge the statute’s constitutionality under

Salerno .

Al-Haramain Islamic Foundation v. U.S. Dept. of Treasury, supra,

the plaintiff challenged the lack of procedural safeguards and regulations under the APA, arguing that OFAC’s designation process was arbitrary and capricious because “none of the regulations [identified] any procedural or substantive criteria to guide the process.” 585 F.Supp.2d at 1253 . In response to plaintiff’s complaint that the designation process lacked procedural safeguards, the court held “there is no mandatory duty requiring OF AC to adopt the regulations AHIF-Oregon demands ..., the agency’s failure to do so cannot be deemed ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law under the APA ... In the absence of regulations, the requirements of due process apply.”

Id.

at 1254 . Thus, although the court did not specifically address the constitutionality of the statute under the

Salerno

“no set of circumstances” test, it rejected plaintiffs challenges by noting that the requirements of

*899

due process apply to and constrain implementation of the statute.

The government argues that the IEEPA can be applied constitutionally. It asserts that its application to KindHearts is an example of a set of circumstances under which the statute is constitutional. It notes that KindHearts suggests safeguards that it believes would satisfy the constitutional standard. Thus, according to the government, KindHearts itself suggests a set of circumstances under which the IEEPA is constitutional.

Khouzam v. Attorney General of the U.S.,

549 F.3d 235, 243-44 (3rd Cir.2008), the court, considering the facial constitutionality of the Foreign Affairs Reform and Restructuring Act of 1998 [FAR-RA] noted that neither the statute nor its implementing regulations provided “any procedures to be afforded the alien once the Attorney General [made] a determination that a deferral [of removal] should be terminated based on diplomatic assurances.” The court did not, however, fault the statute or its implementing regulations for the lack of process the petitioner received. It noted that the Act did not prohibit the Executive from acting constitutionally, and therefore was not facially unconstitutional. The court stated, “We do not attribute the lack of due process to ... FARRA or its implementing regulations, for neither expressly directed the Executive to act in a manner that offends the Fifth Amendment. A statute is not facially unconstitutional unless ‘no set of circumstances exists under which the Act would be valid.’ ”

Id.

at 258 ;

see also, Washington State Grange, supra,

552 U.S. at ---, 128 S.Ct. at 1194 (finding statute was not facially unconstitutional because it could “conceivably be” implemented in a constitutional manner).

But see, e.g., Wis-cousin v. Constantineau,

400 U.S. 433, 439 , 91 S.Ct. 507 , 27 L.Ed.2d 515 (1971) (finding statute that lacked provisions for notice and hearing unconstitutional);

Leslie v. Lacy,

91 F.Supp.2d 1182, 1186, 1193 (S.D.Ohio 2000) (finding statute unconstitutional on its face where text contained “no provision for notice ... or hearing prior to the transfer of title ... or after the transfer of title.”).

OFAC does not contend that due process requirements do not apply at all. Indeed, it contends that it has met those requirements. Thus, it implicitly acknowledges the mandate of due process: it only disputes the claim of noncompliance. Although OFAC, as discussed in the next subsection, failed to afford adequate post-deprivation due process, the statute under which it acted can, if properly administered, be implemented consonant with due process requirements. It is, therefore, not unconstitutional on its face.

B. Asset Freeze: As-Applied Due Process Challenge

KindHearts argues OFAC provided inadequate post-deprivation process after impositing the block pending investigation in February, 2006, thereby violating KindHearts’ due process rights. These violations, according to KindHearts, included OFAC’s failure to specify any objective criteria for blocking KindHearts’ assets and provide either pre- or post-deprivation process. Due to OFAC’s alleged unconstitutional application of its blocking power, KindHearts asks that I lift the block.

KindHearts claims that as notice of the block, OFAC only provided a single boilerplate sentence stating that OFAC was investigating it for possible connections to

*900

Hamas. According to KindHearts, the notice failed to specify the Executive Order criteria OFAC suspected KindHearts of violating, and instead cited all the criteria in one sentence. Although KindHearts repeatedly asked for specification of the charges against it and reasons for OF AC’s freeze, OFAC ignored its requests. KindHearts asked for the full administrative record OFAC was using against it, but OFAC has to date failed to provide KindHearts with the full record.

OFAC notified KindHearts that it could submit a letter in response to OFAC’s block. Despite KindHearts’ prompt submission, OFAC failed to respond for over one year. Its response consisted of a mere acknowledgement of KindHearts’ letter.

The government rejects KindHearts’ assertion that it received constitutionally inadequate process following the blocking of its assets. First, the government argues that in this case, due process does not require pre-deprivation notice or an opportunity to be heard. KindHearts does not refute the contention on this point. Predeprivation notice is not always necessary.

See, e.g., Calero-Toledo v. Pearson Yacht Leasing Co.,

416 U.S. 663, 678-79 , 94 S.Ct. 2080 , 40 L.Ed.2d 452 (1974) (finding that in limited circumstances a seizure can take place without pre-seizure notice and a hearing).

The government insists KindHearts cannot legitimately claim it was unaware of the legal and factual grounds for the block. The initial blocking order notice stated that OFAC blocked KindHearts’ assets under E.O. 13224 and the IEEPA, as amended by the Patriot Act. It included the legal criteria supporting its investigation, stating it was investigating KindHearts for being “controlled by,” “acting for or on behalf of,” “assisting in or providing financial or material support to,” “and/or otherwise being associated with Hamas.”

OFAC notes that the blocking notice did not include every basis for blocking authorized in E.O. 13224. Thus, it disputes KindHearts’ contention that it simply recited that Order’s list. Due process was also provided, the government asserts,

via

its invitation to KindHearts to challenge the blocking order by sending a letter presenting its views and evidence to the attention of the director of OFAC.

The government also claims that the press release placed on its website concurrently with issuance of the blocking notice constituted adequate notice of the factual basis for its decision to block KindHearts’ assets. OFAC adds that to date, it has given KindHearts its letter stating its provisional determination to designate KindHearts an SDGT and the thirty-five unclassified and non-privileged exhibits supporting that provisional determination, redacted provisional determination evidentiary memorandum, redacted block pending investigation evidentiary memorandum and portions of declassified exhibits. All this information, according to OFAC, constitutes sufficient notice for KindHearts meaningfully to challenge the block, along with its challenge to the provisional determination.

KindHearts responds that OFAC is conflating the notice it provided in conjunction with its blocking action with the notice of the provisional SDGT determination.

In response to KindHearts’ complaint about the three year delay in providing the bulk of the materials now in its hands, the

*901

government contends that its original press release, issued concurrently with the blocking order, constituted sufficient notice. That, coupled with the invitation to KindHearts to send a letter challenging the blocking order, satisfied due process. The government additionally argues that whatever notice problems may have existed at the time of the blocking have been cured because KindHearts now has adequate notice and may challenge both the block and impending designation. According to OFAC, whatever process problems the delay caused will be cured because the process is moving forward, and the parties are negotiating a timeline for a prompt adjudication.

(i). Components of Adequate Notice

Constitutionally sufficient notice must be reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. The notice must be ... reasonably [calculated] to convey the required information ... [W]hen notice is a person’s due, process which is a mere gesture is not due process.

Mullane v. Cent. Hanover Bank & Trust Co.,

339 U.S. 306, 314-15 , 70 S.Ct. 652 , 94 L.Ed. 865 (1950).

Constitutionally sufficient notice should give the party an understanding of the allegations against it so that it has the opportunity to make a meaningful response. The party must be able to know the conduct on which the government bases its action, so that it can explain its conduct or otherwise respond to the allegations. It must also have reasonable access to the evidence that the government is using against them.

See, e.g., Gete v. I.N.S.,

121 F.3d 1285, 1297-98 (9th Cir.1997) (discussing requirements of notice).

To determine whether KindHearts received constitutionally required process in conjunction with OFAC’s block pending investigation, I must weigh 1) “the private interest ... affected by the official action;” 2) “the risk of an erroneous deprivation of such interest through the procedures used;” and 3) “the Government’s interest, including the function involved and the fiscal and administrative burdens that ... additional or substitute procedural requirement would entail.”

Mathews v. Eldridge,

424 U.S. 319, 335 , 96 S.Ct. 893 , 47 L.Ed.2d 18 (1976).

(ii). What OFAC Provided as Notice

To the extent that the government has provided notice of the basis for its blocking notice, it has done so in a piecemeal and partial manner. The blocking order simply recited criteria from E.O. 13224 and referenced the IEEPA, as amended by the Patriot Act and 31 C.F.R. Part 594. According to KindHearts, OFAC simply stated all possible criteria for investigation in a single sentence. OFAC disputes this, noting that it did not mention all of the criteria listed in the Executive Order.

The concurrently posted press release similarly failed, according to KindHearts, to give any useful information about why the government froze all its assets and put it out of operation.

OFAC’s invitation to KindHearts to send a letter in response to the blocking

*902

notice did not add to KindHearts’ understanding of the reasons and basis for the government’s actions. The government did not offer access to the unclassified administrative record, any part of the documents and property seized during execution of the search warrants, or funds to pay attorney fees. Nonetheless, KindHearts’ attorney at that time, Jihad Smaili, promptly submitted a challenge to OFAC’s blocking action.

On November 29, 2006, Lynne Bernabei, successor counsel for KindHearts, wrote OFAC requesting access to the full administrative record for the potential designation. Not only did OFAC not provide any portion of the administrative record, it did not even respond to the November 29th letter.

On May 25, 2007, fifteen months after OFAC blocked KindHearts, and more than a year after Smali’s letter to OFAC, OFAC notified KindHearts that it had provisionally determined to designate KindHearts an SDGT. OFAC’s notice acknowledged receipt of Smaili’s November 29, 2006, letter, and stated that since receiving his letter, it had completed its investigation, which resulted in the provisional SDGT designation.

OFAC’s notice of provisional designation did not recite new or alternative grounds for the potential designation. Instead, OFAC reiterated that its blocking action was based on the IEEPA, E.O. 13224 and 31 C.F.R. Part 594. It included with the letter thirty-five unclassified, non-privileged exhibits, which constituted the unclassified administrative record on which OFAC based its provisional determination.

OFAC did not include a statement explaining how those exhibits related to its charges against KindHearts, or how those documents were relevant.

See Al-Haramain, supra,

585 F.Supp.2d at 1255-56 (stating that the government failed to provide constitutionally adequate process when it provided the administrative record supporting its designation /redesignation but the majority of those documents did not mention the plaintiff, and OFAC failed to explain the significance of that evidence).

Twenty of the thirty-five exhibits provided to KindHearts with the provisional determination notice do not mention KindHearts.

The unclassified administrative

*903

record includes court opinions and indictments in

Global Relief

and

Holy Land

cases, historical articles, a Council on Foreign Relations Backgrounder on Hamas, various OFAC press releases, newspaper articles, KindHearts’ Newsletters and its organizational chart. OFAC invited KindHearts to respond to its provisional determination decision within thirty days of the date of the letter.

On June 14, 2007, KindHearts renewed its request for the full administrative record, both classified and unclassified. On June 25, 2007, KindHearts responded to OFAC’s provisional determination with a twenty-eight page preliminary submission. It attached to that a 1369-page submission of supporting evidence. On June 27, 2007 KindHearts also requested that OFAC initiate declassification review.

OFAC never responded to KindHearts’ June 25th submission.

On August 10, 2007, KindHearts asked OFAC to perform a declassification review of the classified and privileged evidence on which it relied.

OFAC agreed, and said it would give KindHearts thirty days after the end of the declassification review to submit a response. For over fourteen months OFAC reported no progress with the review.

On August 13, 2007, KindHearts requested further clarification of the charges against it, and an extension of time until forty-five days after the declassification review was complete. On August 15, 2007, it also asked for access to classified evidence and to its own documents, all of which had been seized. On November 6, 2008, OFAC sought declassification review of block-related documents.

On December 12, 2008, approximately thirty-four months after the block pending investigation, and approximately eighteen months after its provisional determination to designate KindHearts an SDGT, the government provided KindHearts with redacted versions of the block memorandum and evidentiary memo on which it relied in reaching its provisional determination. In its redacted provisional determination memo, OFAC indicated the significance of the unclassified records it had released nineteen months earlier.

In December, 2008, and January, 2009, OFAC declassified portions of the administrative record supporting its block. That record included seven exhibits that the government had not included among the exhibits disclosed with the provisional determination decision. The additional exhibits, according to the government, had not been relied on in making that determination.

The December, 2008, submission included a redacted copy of the block memorandum.

*904

On January 30, 2009, 594 F.Supp.2d 855 (N.D.Ohio 2009), OFAC declassified portions of several paragraphs in the block memorandum. On March 13, 2009, in response to KindHearts’ final brief relating to the pending pretrial motions, OFAC declassified one of the several bases for its block and provisional determination to designate KindHearts.

In sum, the “notice” KindHearts has received to date, since the government’s provisional determination to designate it an SDGT, is the letter KindHearts received informing it of the government’s decision, the thirty-five unclassified, non-privileged exhibits, and a redacted version of the provisional determination evidentiary memo. OFAC claims it relied on the thirty-five exhibits in making its blocking decision, in addition to seven other exhibits that it did not rely on in making its provisional determination decision. Those seven exhibits and the redacted block evidentiary memorandum have been handed over to KindHearts.

KindHearts remains largely uninformed about the basis for the government’s actions. To the extent that it has become usefully informed, that information came only after long, unexplained and inexplicable delay and following multiple requests for information.

(iii). OFAC’s “Notice” Was Constitutionally Inadequate

OFAC’s block of KindHearts resulted in the indefinite freeze of all of KindHearts’ assets and property, including about one million dollars in bank accounts. The block shut KindHearts down indefinitely and its corporate existence remains in jeopardy due to OFAC’s block pending investigation.

Applying the first factor from the

Mathews

balancing test — the private interest affected by OFAC’s action — it is clear that the private interest is substantial. An American corporation has had all its assets seized and been put out of business without being told, in any meaningful or useful way why, or on what basis the government took that action.

Applying the second

Mathews

factor— the risk of erroneous deprivation — I conclude that the failure to provide adequate and timely notice creates a substantial risk of wrongful deprivation. This is especially so in view of the fact that the government does not contend that KindHearts was donating its funds exclusively to Hamas. But the government has not provided its estimate of the approximate amounts of such donations, or what portion of KindHearts’ funds went to Hamas or individuals or entities related to Hamas.

Nor, as importantly, has the government stated which recipients, to the extent that it knows of specific recipients, were Hamas fronts or Hamas affiliated. Without this sort of information, KindHearts cannot meaningfully challenge the government’s actions. Not knowing to whom, in the government’s view, its funds should not have gone, it cannot rebut the government’s claim that recipients were Hamas connected.

An inability to rebut necessarily enhances, if it does not entirely ensure, the likelihood of erroneous deprivation.

*905

Other courts have found that failure to provide meaningful notice creates a high risk of erroneous deprivation. For example, in

Gete, supra,

the Ninth Circuit held that INS’ procedures following vehicle seizures violated procedural due process. The court faulted INS for failing to provide, post-seizure, its legal and factual basis for the seizure, “copies of [the] evidence to be used against them,” and “statements of the reasons for its denials of relief.”

Id.

at 1298 . It explained that such procedures were necessary to “permit [plaintiffs] effectively to rebut the INS’ claims.”

Id.

at 1297 . The court explained:

[Requiring the disclosure of the factual bases for seizures would go a long way toward preventing some of the erroneous and fundamentally unfair forfeiture decisions that inevitably flow from so haphazard a process. So, too, would requiring the giving of notice of the specific statutory provision allegedly violated, rather than allowing the mere provision, without explanation, of copies of the entire statute and regulations. Similarly, furnishing owners with copies of evidence to be used against them, such as officers’ reports detailing the facts upon which the claim of probable cause is based, would permit them to understand the true nature of the INS’ charges and afford them a fair opportunity to prepare a proper defense to the threatened forfeiture. Finally, requiring the INS to provide statements of the reasons for its denials of relief would enable persons whose vehicles have been declared forfeited to determine whether the agency based its decision on erroneous facts, to discover whether there is evidence not previously considered that might be submitted, and to prepare reasonably informed petitions for remission, mitigation, and reconsideration.

Id.

at 1298 .

To comply with due process requirements, OFAC should, at the very least, have promptly given KindHearts the unclassified administrative record on which it relied in taking its blocking action.

See Al Haramain, supra,

585 F.Supp.2d at 1255-57 (discussing the inadequacy of the record’s contents, but taking for granted that the record should be provided after the block);

Global Relief Found., supra,

207 F.Supp.2d at 808 (noting OFAC publicly filed four binders of exhibits on March 27, 2002, approximately three months after OFAC’s block of Global Reliefs assets);

Holy Land Found., supra,

333 F.3d at 164 (stating due process requires disclosure of the unclassified portions of the administrative record). Without that record, OFAC’s invitation to send a letter challenging the block held out no hope that any challenge would be either comprehensive or successful.

Applying the third

Mathews

factor — the governmental interest and burden of providing additional procedural protection — I note that OFAC has not explained, either to KindHearts or this court, why it failed to provide timely notice of the basis and reasons for its blocking order, or why it took so long for it to provide the scanty information it ultimately has produced.

OFAC apparently assumes that no explanation is needed. If so, it necessarily concedes that the third

Mathews

factor indisputably favors KindHearts. Absent an explanation for its conduct and dismissive treatment of KindHearts’ oft-repeated requests, it cannot claim that to have done

*906

otherwise would have been unacceptably or unduly burdensome.

In sum, consideration of the

Mathews

factors leads inescapably to the conclusion that OFAC violated KindHearts’ fundamental right to be told on what basis and for what reasons the government deprived it of all access to all its assets and shut down its operations. Whether OFAC violated the Constitution deliberately or indifferently does not matter at this stage: what matters is that OFAC did not meet its obligation to provide meaningful notice regarding its deprivation of KindHearts’ property.

(iv). Failure to Provide Prompt Post-Deprivation Hearing

In addition to constitutionally inadequate notice procedures, KindHearts also argues OFAC failed to provide it a meaningful opportunity to be heard. As the Supreme Court stated in

Fuentes v. Shevin,

407 U.S. 67, 80-81 , 92 S.Ct. 1983 , 32 L.Ed.2d 556 (1972) (citation omitted):

The constitutional right to be heard is a basic aspect of the duty of government to follow a fair process of decisionmaking when it acts to deprive a person of his possessions. The purpose of this requirement is not only to ensure abstract fair play to the individual. Its purpose, more particularly, is to protect his use and possession of property from arbitrary encroachment-to minimize substantively unfair or mistaken deprivations of property,.... So viewed, the prohibition against the deprivation of property without due process of law reflects the high value, embedded in our constitutional and political history, that we place on a person’s right to enjoy what is his, free of governmental interference.

Despite the due process requirement of prompt post-deprivation hearing, KindHearts received no response to its administrative challenge for over one year. When OFAC finally responded, it merely stated it had received KindHearts’ challenge and had provisionally determined to designate it an SDGT. It provided no reasons for its decision. It merely enclosed a copy of the unclassified record on which it relied in making its provisional determination and invited KindHearts to send another response.

It is unclear whether OFAC even considers its invitation to KindHearts to challenge its block and its one line response a “post-deprivation hearing.”

OFAC did not require the challenge by a certain date, nor did it agree to respond by a certain date. It waited over a year to respond. And one can hardly consider its one sentence acknowledgment of the receipt of KindHearts’ letter (which KindHearts put forward without the unclassified record, its own documents or access to its funds to pay its attorneys) a due process hearing.

Even if OFAC somehow believes that its invitation to send a letter fulfilled, at least initially, its obligation to give KindHearts an opportunity to be heard, its subsequent unresponsiveness has left KindHearts without any semblance of due process.

This is particularly true in light of how long OFAC has withheld the opportunity to be heard. Partially through simple unresponsiveness, and partially through piecemeal disclosure of information, OFAC has engendered a delay of remarkable duration.

Promptness is an important aspect of the due process right to be heard.

Barry v. Barchi,

443 U.S. 55, 64 , 99 S.Ct. 2642 , 61

*907

L.Ed.2d 365 (1979). There is, though, no bright-line gauge for determining whether the government has provided a hearing with sufficient promptness to protect against undue severity from the deprivation. Instead, the Supreme Court has created another balancing test, whereby courts are to examine the “importance of the private interest and the harm to this interest occasioned by delay; the justification offered by the government for delay and its relation to the underlying governmental interest; and the likelihood that the interim decision may have been mistaken.”

Fed. Deposit Ins. Corp. v. Mallen,

486 U.S. 230, 242 , 108 S.Ct. 1780 , 100 L.Ed.2d 265 (1988).

In this case, KindHearts asserts a substantial private interest-its existence and loss of access to its assets.

OFAC asserts its dilatoriness resulted from a need to progress further with its investigation before being able to evaluate KindHearts’ challenge. It argues Congress gave OFAC the power to maintain the

status quo

while determining whether an organization has unlawful ties to Specially Designated Global Terrorists.

OFAC also argues that KindHearts is partly responsible for the delay, particularly any delay after May 25, 2007. OFAC notes that KindHearts has requested several extensions to respond to OFAC’s piecemeal disclosure of information about its reasons for the blocking order.

OFAC bears primary responsibility for the delay KindHearts has encountered in its effort to be heard: It waited fifteen months after the block to make a provisional determination and provide even the largely uninformative unclassified record to KindHearts. In the meantime, OFAC apparently lost a 1369-page submission that KindHearts attached to its preliminary response.

After OFAC agreed to declassify documents, more than fourteen months passed before KindHearts saw any results from the declassification review. OFAC took more than thirty months to give KindHearts redacted records supporting its blocking action. It also resisted giving KindHearts access to its own documents. The delays KindHearts has sought have, in contrast, been a reasonable attempt to be able to review and respond to intermittent, and still incomplete disclosure of the information on which OFAC acted.

The final element of the promptness inquiry is the likelihood that the interim decision was mistaken. OFAC presently asserts that it issued the block order and has been investigating KindHearts because: 1) from KindHearts’ inception individuals have been involved in the organization who were active and influential participants in other Islamic charities that OFAC has shut down due to their support of overseas terrorist organizations, including Hamas; 2) members of KindHearts have had contacts with known members of Hamas; and 3) KindHearts’ funds have gone to Hamas controlled entities in the Middle East.

The materials provided to KindHearts give rise to some reason to believe that these allegations may be so. But what matters is whether OFAC has failed to afford KindHearts with a adequate opportunity to be heard in response to those allegations. On balancing the pertinent factors, I conclude that OFAC has failed to provide a meaningful hearing, and to do so

*908

with sufficient promptness to moderate or avoid the consequences of delay. OFAC did not provide timely or sufficient notice to enable KindHearts to prepare an effective challenge. OFAC ignored KindHearts’ initial response. What reply OFAC made to KindHearts’ responses and requests was delayed and did not cure the deficiencies of its earlier notice. Even if OFAC may ultimately show it had an adequate basis for the blocking order, that does not justify the length of the government’s delay in giving KindHearts an opportunity to be heard.

(v). Prejudice to KindHearts From the Due Process Violations

After concluding that OFAC’s provision of post-block process was constitutionally deficient, I must determine whether, despite the unconstitutional procedures, I can “say any due process violation was harmless beyond a reasonable doubt.”

Al Haramain, supra, 585

F.Supp.2d at 1257

Cciting Tennessee Secondary Sch. Athletic Ass’n v. Brentwood Academy,

551 U.S. 291, 303 , 127 S.Ct. 2489, 2497 , 168 L.Ed.2d 166 (2007)).

The parties’ briefs have not addressed this issue, and I am not certain that the record, in any event, is sufficiently developed to determine whether and to what extent KindHearts has been prejudiced, and whether any such prejudice has been cured or presently can be remedied. Further proceedings must occur before these questions can be answered.

C. As-Applied Challenge to Provisional Designation

KindHearts also raises constitutional challenges to the process provided in conjunction with OFAC’s provisional designation of KindHearts a SDGT.

OFAC does not contest KindHearts’ right to have adequate pre-designation notice and an opportunity to be heard. It claims it has provided the process that is due KindHearts relative to SDGT status.

OFAC also contends that KindHearts’ claim that OFAC has not provided due process with regard to such status is not ripe for judicial review. This is so, according to OFAC, because it has yet to take final agency action, in the form of final designation of KindHearts as a SDGT. Thus, it argues, its actions thus far are not judicially reviewable under the APA.

The APA limits judicial review of administrative actions to “final agency actions.” 5 U.S.C. § 704 . KindHearts insists, however, that, under

Abbott Laboratories v. Gardner,

387 U.S. 136 , 87 S.Ct. 1507 , 18 L.Ed.2d 681 (1967),

abrogated on other grounds, Califano v. Sanders,

430 U.S. 99 , 97 S.Ct. 980 , 51 L.Ed.2d 192 (1977), I can nonetheless now enjoin final SDGT designation.

Abbott Laboratories

the Court upheld pre-enforcement review of agency actions. As KindHearts reads this decision, anticipated agency action is ripe for judicial review if the court finds that the issues are

*909

“fit for judicial review” and the parties will be harmed if I withhold consideration.

The decision in

Abbott Labs

and cases applying that decision are, however, limited to cases in which petitioners seek preenforcement review of what courts deem “final agency actions.” For agency actions to be considered final, “the action must mark the consummation of the agency’s decision-making process — it must not be of a merely tentative or interlocutory nature.”

Bennett v. Spear,

520 U.S. 154, 177-78 , 117 S.Ct. 1154 , 137 L.Ed.2d 281 (1997). The action must also “be one by which rights or obligations have been determined, or from which legal consequences will flow.”

Id.

(citations omitted).

Abbott Labs,

the Supreme Court permitted pre-enforcement judicial review of an FDA regulation interpreting a statute. The Court found that pre-enforcement review was appropriate despite the fact that the regulation had not yet been enforced against a specific party. In its analysis, the Court noted that the ripeness doctrine required it to consider the “fitness of the issues for judicial decision” and the “hardship to the parties of withholding court consideration.”

Id.

at 149, 87 S.Ct. 1507 .

In its discussion of the fitness of the issues for judicial review, the Court asserted that it considered the issuance of the regulation “final agency action” making it ripe for review under the APA. It noted that courts have “interpreted the finality element in a pragmatic way.”

Id.

In each of the examples it cited to support a pragmatic interpretation of the finality element, the Court found agency regulations and orders as final agency actions fit for judicial review. Asserting that the regulation at issue in

Abbott Labs

constituted final agency action, the Court stated, “The regulation challenged here, promulgated in a formal manner after announcement in the Federal Register and consideration of comments by interested parties is quite clearly definitive. There is no hint that this regulation is informal.”

Id.

at 151 , 87 S.Ct. 1507 .

Ammex Inc. v. Cox,

351 F.3d 697, 706 (6th Cir.2003), the Sixth Circuit, applying

Abbott Labs,

held that ripeness in the context of pre-enforcement review of agency action requires the court to weigh three factors:

The first two deal with the fitness of the issues for judicial determination. One aspect of the judicial fitness of the issues is the extent to which the legal analysis would benefit from having a concrete factual context. The second aspect ... is the extent to which the enforcement authority’s legal position is subject to change before enforcement. The third consideration deals with the hardship to the parties of withholding court consideration.

In its discussion of the second factor, the Sixth Circuit noted that in

Abbott Labs,

the court found the regulation ripe for judicial review because it represented a “final regulation that the FDA was unlikely to change.”

Id.

at 708 .

After noting the need for final agency action, the Sixth Circuit found no final agency action in

Ammex,

where the “Notice of Intended Action” was “at most an initiation of proceedings” and not final agency action.

Id.; see also National Park Hospitality Ass’n v. Dept. of Interior,

538 U.S. 803, 812 , 123 S.Ct. 2026 , 155 L.Ed.2d 1017 (2003) (considering whether section at issue was final agency action, in addition to whether the question presented was a purely legal one, and whether “further factual development would significantly advance the court’s ability to deal with the legal issues presented”);

Texas v. U.S.,

497 F.3d 491, 498-99 (5th Cir.2007) (finding challenge to secretarial procedures fit for judicial review in part because they constituted “final agency action, as

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they [were] final rules that were promulgated through a formal notice — and—comment rule-making process after announcement in the

Federal Register

”).

It is unclear which of OFAC’s actions KindHearts considers “final” and subject to review. OFAC has not formally designated KindHearts an SDGT. KindHearts argues that OFAC has, for all intents and purposes, already made a final decision regarding its designation. OFAC, however, has stated that it will consider a response from KindHearts before determining whether to designate it. I cannot assume that OFAC will designate KindHearts before it has done so.

OFAC’s provisional determination to designate KindHearts is not final agency action subject to review, because it does not “mark the consummation of the agency’s decision-making process.”

Bennett v. Spear,

520 U.S. 154, 177 , 117 S.Ct. 1154 , 137 L.Ed.2d 281 (1997).

Another point of contention is OFAC’s unwillingness to provide access to classified evidence or further notice to KindHearts. OFAC contends that it has provided sufficient due process to KindHearts. Thus, its attitude toward giving more information to KindHearts appears “final.”

I have not come across a case in which a court deemed an agency’s interlocutory and ongoing decisions regarding notice, where such decisions have not been formalized by agency rule, regulation, statute, order etc., as a final agency action subject to judicial review. The

Abbott Labs

line of cases permitting pre-enforcement review does not involve a due process claim similar to that which KindHearts raises. KindHearts does not seek preenforcement review of a formal, finalized regulation, statute or policy. KindHearts seeks, rather, pre-enforcement review of a process that it asserts has denied it due process.

I conclude, accordingly that KindHearts’ due process challenge to possible final designation as a SDGT is not ripe for judicial review.

D. Restrictions on KindHearts’ Access to Its Own Documents

KindHearts argues that OFAC also severely restricted its due process right to meaningfully respond to allegations against it by: 1) denying it access to its own documents for over two years; 2) placing unreasonable restrictions on its ability to review and use the documents; and 3) requiring counsel to give the government results of any independent investigation taken as part of KindHearts’ defense.

During its February, 2006, execution of search warrants at KindHearts’ office and its president’s home, the FBI seized 150 boxes of documents, paper files, computer hard drives, video tapes and other media. OFAC refused to provide KindHearts copies of those records for over two years. KindHearts claims those records constituted the core of its defense because they document how it spent its money.

KindHearts also contends that in creating its administrative record OFAC selectively used those documents, excluding information unfavorable to it and thereby skewing that record.

In 2008, OFAC gave KindHearts’ counsel an electronic copy of a subset of its documents subject to a protective order. The order prohibited KindHearts members and officers from viewing the documents without court approval, and forbade KindHearts counsel from printing or electronically copying any documents. Only one representative had a copy of a subset of its own documents.

After KindHearts filed suit on October 9, 2008, the United States Attorney’s office indicated a willingness to discuss amend

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ments to the protective order. The government agreed to amend the order, permitting KindHearts attorneys to have an electronic copy of the documents, and allowing former KindHearts officials to view the documents in counsels’ offices.

KindHearts complained that these restrictions still interfered with its ability to present a meaningful defense. Because some former officials live elsewhere than where the attorneys reside, KindHearts objected to the requirement that those officials could only review documents in counsels’ offices. It similarly objected to the restriction on counsels’ ability to print documents for review or to attach to pleadings.

The government acknowledged it provided counsel with an incomplete “subset” of the seized materials. It refused to provide the remainder even under the restrictive terms of the protective order, and despite the fact that the materials, having been generated by KindHearts, were not classified.

OFAC claimed these restrictions were reasonable. In its initial response, it argued the blocked documents could contain sensitive information such as donor lists, donee information, procedures to avoid detection, etc. According to OFAC, its substantive reasons for limiting access to documents trumped KindHearts’ concerns.

This court, on January 30, 2009, granted KindHearts’ motion to modify the amended protective order. It required OFAC to disclose to KindHearts copies of all documents seized by the government, without unreasonable restrictions. In light of the protective order, OFAC allowed KindHearts to receive blocked documents and removed the requirement that documents be viewed only under supervision of counsel. It therefore rendered moot KindHearts’ complaints regarding OFAC’s rule that former KindHearts officials review documents in the presence of counsel.

Though KindHearts now enjoys substantially unrestricted access to its own documents, that does not mean that the government’s conduct has no due process implications. Without access to its corporate records, KindHearts would find it difficult, if not impossible to document claims that OFAC either overlooked records favorable to KindHearts or misinterpreted records. Denying access by KindHearts’ counsel to its client’s records deprived them of an important, if not the principal means for challenging the blocking order and defending against final designation of their client as a SDGT.

This action, coupled with OFAC’s delay in providing any significant information from its own files about its basis and reasons for the blocking order, left KindHearts’ attorneys almost entirely unequipped to marshal and present evidence. This, in turn, would have lessened significantly the benefits from having an opportunity to be heard, had a due process hearing been afforded to KindHearts.

E. OFAC’s Limitations On KindHearts’ Investigation

KindHearts argues that OFAC’s requirement that it identify all documents obtained from former KindHearts officials violates its due process right to a meaningful defense by forcing it to act as agents for the government. It also argues the rule is an “arbitrary and capricious exercise of authority granted under the Regulations.”

OFAC responds that it only requires generic information regarding additional documents. For example, it wants to know the number of boxes of documents acquired from former KindHearts officials, to ensure that such material is not destroyed or disseminated. KindHearts rejects this explanation, stating the “parameters of [the rule] remain impermissibly unclear and subject to OFAC’s whim, especially given ... the plain terms of the

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regulation — to which OFAC originally cited in support of its disclosure requirement, 31 C.F.R. 501.603(b)(ii).” This rule requires substantial details about documents obtained, such as the owner, property, location, and contact information for the holder of the property. 31 C.F.R. § 501.603 (b)(ii) requires initial reports on blocked property to,

[D]escribe the owner or account party, the property, its location, any existing or new account number or similar reference necessary to identify the property, actual or estimated value and the date it was blocked, and shall include the name and address of the holder, along with the name and telephone number of a contact person from whom compliance information can be obtained. If the report is filed by a financial institution and involves the receipt of a payment or transfer of funds which are blocked by the financial institution, the report shall also include photocopy of the payment or transfer instructions received and shall confirm that the payment has been deposited into a new or existing blocked account which is labeled as such and is established in the name of, or contains a means of clearly identifying the interest of, the individual or entity subject to blocking pursuant to the requirements of this chapter.

OFAC states that it only requires general descriptions of the blocked property, and that such a description “need not include the contents or even the name of the source of the documents. It could satisfy its obligation by stating it was in possession of three boxes of documents.” [Doc. 36]. Giv

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