United States v. Phoday Phattey

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA, No. 18-35998

Plaintiff-Appellee,

D.C. No.

v. 3:17-cv-00247-JWS-

MMS

PHODAY BABA PHATTEY,

a.k.a. Foday Fatty,

Defendant-Appellant. OPINION

Appeal from the United States District Court

for the District of Alaska

John W. Sedwick, District Judge, Presiding

Submitted August 5, 2019*

Anchorage, Alaska

Filed December 5, 2019

Before: Richard C. Tallman, Sandra S. Ikuta, and

N. Randy Smith, Circuit Judges.

Opinion by Judge Ikuta

*

The panel unanimously concludes this case is suitable for decision

without oral argument. See Fed. R. App. P. 34(a)(2).

2 UNITED STATES V. PHATTEY

SUMMARY**

Immigration

Affirming the district court’s grant of summary judgment

in favor of the government, the panel held that the five-year

statute of limitations set out by 28 U.S.C. § 2462, which

generally applies to actions to enforce civil penalties, does

not apply to denaturalization proceedings.

In 2010, Phoday Phattey was issued a certificate of

naturalization. In 2017, the government learned that Phattey

had obtained his citizenship by fraud and filed a complaint to

revoke naturalization under 8 U.S.C. § 1451(a). Although

§ 1451(a) does not contain a statute of limitations, Phattey

argued that the five-year statute of limitations set out by

28 U.S.C. § 2462 applies to revocation proceedings and

that, therefore, the statute of limitations to bring the

denaturalization action had expired.

Observing that the Supreme Court has long held that

revocation of citizenship is not a penalty, the panel held that

§ 2462 does not provide Phattey a statute-of-limitations

defense because denaturalization is not a penalty for purposes

of § 2462. The panel rejected Phattey’s argument that the

relevant precedent had been superseded by Kokesh v. SEC,

137 S. Ct. 1635 (2017), in which the Supreme Court

concluded that § 2462 applies to disgorgement actions

brought by the Securities Exchange Commission. The panel

observed that the Supreme Court set out two principles in

**

This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

UNITED STATES V. PHATTEY 3

Kokesh: 1) whether a sanction represents a penalty turns in

part on whether the wrong sought to be addressed is a wrong

to the public or a wrong to an individual; and 2) a pecuniary

sanction operates as a penalty only if it is sought for the

purpose of punishment, and to deter others from offending.

The panel explained that, although the wrong sought to be

redressed by denaturalization is a wrong to the public,

revocation of citizenship is not sought for the purpose of

punishment or to deter future violations. Rather, the purpose

of denaturalization is to remedy a past fraud by taking back

a benefit to which the alien is not entitled and thus restoring

the status quo ante.

COUNSEL

Nicolas A. Olano and Lara E. Nations, Nations Law Group,

Anchorage, Alaska, for Defendant-Appellant.

Joseph F. Carilli, Jr., Trial Attorney; Joseph H. Hunt,

Assistant Attorney General, William C. Peachey, Director,

District Court Section; Timothy M. Belsan, Chief, National

Security & Affirmative Litigation Unit; Office of

Immigration Litigation, Civil Division, United States

Department of Justice, Washington, D.C.; for

Plaintiff-Appellee.

4 UNITED STATES V. PHATTEY

OPINION

IKUTA, Circuit Judge:

This appeal raises the question whether the revocation of

citizenship on the ground that the grant of citizenship was

“illegally procured or . . . procured by concealment of a

material fact or by willful misrepresentation,” 8 U.S.C.

§ 1451(a), constitutes a “penalty” for purposes of the five-

year statute of limitations generally applicable to civil fines,

penalties, and forfeitures, see 28 U.S.C. § 2462. Because the

purpose of denaturalization is to remedy a past fraud by

taking back a benefit to which an alien is not entitled, see

Johannessen v. United States, 225 U.S. 227, 242–43 (1912),

we conclude it is not a penalty, and the statute of limitations

does not apply.

I

Phoday Phattey arrived in New York in 1995 with a non-

immigrant U.S. visa and a Gambian passport issued to Foday

Fatty. He submitted an application for asylum and

withholding of removal under the name Foday Fatty. An

immigration judge denied his application and ordered him

removed, but the government was unable to locate him to

execute the removal order.

Shortly after he was ordered to be removed, Phattey

applied again for asylum and withholding, this time using the

name Phoday Phattey. In his application, Phattey claimed he

was a citizen of Mauritania who had recently arrived in

Miami, Florida. He also denied having a passport or using

any other names. As required by the application, he swore

that the contents of the application were all “true and

UNITED STATES V. PHATTEY 5

correct.” The second application for asylum was granted in

September 1997. Phattey successfully registered as a legal

permanent resident in 2004.

In April 2010, Phattey applied for citizenship under the

name Phoday Phattey. He left blank the space provided to

identify other names used, which indicated that he had never

used another name. Phattey also falsely stated in the

application that he had never lied to a government official to

gain entry or admission into the United States, given false or

misleading information to a government official while

applying for an immigration benefit or to prevent deportation

or removal, or been ordered to be removed or deported.

Phattey signed this application under penalty of perjury,

certifying that his answers were all “true and correct.” In his

interview with an immigration officer, Phattey again swore

that the contents of his application were true and correct.

Phattey’s application for citizenship was successful. He took

the Oath of Allegiance on August 20, 2010, see 8 C.F.R.

§ 337.1, and was issued a certificate of naturalization.

In November 2017, as part of a Department of Homeland

Security investigation, the government learned of Phattey’s

immigration fraud and filed a complaint to revoke

naturalization. See 8 U.S.C. § 1451(a).1 The government

1

8 U.S.C. § 1451(a) states, in material part:

It shall be the duty of the United States attorneys for the

respective districts, upon affidavit showing good cause

therefor, to institute proceedings in any district court of

the United States in the judicial district in which the

naturalized citizen may reside at the time of bringing

suit, for the purpose of revoking and setting aside the

order admitting such person to citizenship and

6 UNITED STATES V. PHATTEY

later presented matching fingerprints from the asylum

applications of Foday Fatty and Phoday Phattey to establish

that the two are the same person.

In his answer to the government’s complaint, Phattey

invoked his Fifth Amendment right against self-incrimination

and declined to respond to the charges against him.

Nevertheless, he raised the defense that the statute of

limitations to bring a denaturalization action under § 1451(a)

had expired. Although § 1451(a) does not contain a statute

of limitations, Phattey argued that 28 U.S.C. § 2462—a

catch-all provision imposing a five-year limitations period on

any action to enforce a penalty—applies to revocation

proceedings.2

canceling the certificate of naturalization on the ground

that such order and certificate of naturalization were

illegally procured or were procured by concealment of

a material fact or by willful misrepresentation . . . :

Provided, That refusal on the part of a naturalized

citizen within a period of ten years following his

naturalization to testify as a witness in any proceeding

before a congressional committee concerning his

subversive activities . . . shall be held to constitute a

ground for revocation of such person’s naturalization

under this subsection . . . .

2

28 U.S.C. § 2462 provides:

Except as otherwise provided by Act of Congress, an

action, suit or proceeding for the enforcement of any

civil fine, penalty, or forfeiture, pecuniary or otherwise,

shall not be entertained unless commenced within five

years from the date when the claim first accrued if,

within the same period, the offender or the property is

found within the United States in order that proper

service may be made thereon.

UNITED STATES V. PHATTEY 7

The parties both moved for summary judgment. Based on

the matching fingerprints from Phattey’s two asylum

applications and a negative inference from Phattey’s

invocation of the Fifth Amendment, the district court granted

the government’s motion for summary judgment, concluding

that Phattey and Fatty were the same person and that the

government, through “clear, unequivocal, and convincing”

evidence, had carried the “heavy burden,” Fedorenko v.

United States, 449 U.S. 490, 505 (1981) (citations omitted),

of proving that Phattey’s citizenship was “illegally procured,”

8 U.S.C. § 1451(a). The district court rejected Phattey’s

statute of limitations defense. This appeal followed.

II

On appeal, Phattey primarily claims that the revocation of

citizenship, sometimes referred to as “denaturalization,”

constitutes a penalty. Because 28 U.S.C. § 2462 imposes a

five-year statute of limitation on actions for the enforcement

of a penalty, Phattey contends that the government cannot

now revoke his citizenship because more than five years have

passed since he was naturalized. Therefore, he concludes, the

district court erred in rejecting his statute of limitations

defense.

We have jurisdiction under 28 U.S.C. § 1291. “A grant

of summary judgment is reviewed de novo.” Suzuki Motor

Corp. v. Consumers Union of U.S., Inc., 330 F.3d 1110, 1131

(9th Cir. 2003). In reviewing a grant of summary judgment,

we must “[v]iew[] the evidence in the light most favorable to

the nonmoving party” and “determine whether there are any

genuine issues of material fact and whether the district court

correctly applied the relevant substantive law.” Devereaux v.

Abbey, 263 F.3d 1070, 1074 (9th Cir. 2001) (en banc).

8 UNITED STATES V. PHATTEY

III

Congress’s authority over naturalization stems from its

power to “establish an uniform Rule of Naturalization.” U.S.

Const. art. I, § 8, cl. 4. The Supreme Court has recognized

that this constitutional authority gives Congress the power to

impose “prerequisites to the acquisition of citizenship.”

Fedorenko, 449 U.S. at 506. The “[f]ailure to comply with

any of these conditions renders the certificate of citizenship

‘illegally procured,’” and the Court recognized that

“naturalization that is unlawfully procured can be set aside.”

Id. (citations omitted).

Congress set out procedures for revoking naturalization,

when procured by fraud or other unlawful acts, by enacting

Section 15 of the Naturalization Act of 1906 (the 1906 Act),

34 Stat. 596, 601. See Bindczyck v. Finucane, 342 U.S. 76,

83 (1951). When Congress replaced the 1906 Act with the

Immigration and Nationality Act of 1952 (the INA), it

retained substantially all of the language of Section 15 and

included it in 8 U.S.C. § 1451(a). The relevant statutory

provision remains substantially the same today and permits

denaturalization where naturalization was “illegally procured

or . . . procured by concealment of a material fact or by

willful misrepresentation.” 8 U.S.C. § 1451(a). Nothing in

the statute provides for the imposition of a fine, penalty, or

sentence of imprisonment—only the revocation of

citizenship. See id.

The Supreme Court has long held that the revocation of

citizenship under these denaturalization provisions is not a

penalty. See Johannessen, 225 U.S. at 242–45; Trop v.

Dulles, 356 U.S. 86, 98–99 (1958). In the seminal case of

Johannessen, decided shortly after the enactment of the 1906

UNITED STATES V. PHATTEY 9

Act, the Supreme Court considered the claims of a naturalized

citizen facing cancellation of his naturalization certificate on

the ground that it had been “fraudulently and illegally

procured.” 225 U.S. at 232. The alien argued that the

denaturalization provision in Section 15, if applied

retroactively, would be void as an ex post facto law in

violation of the Constitution. Id. at 242. The Court rejected

this argument based on the well-settled rule that the

constitutional prohibition of ex post facto laws “is confined

to laws respecting criminal punishments.” Id. at 242 (citing

U.S. Const. art 1, § 9). The Court acknowledged the

prohibition does not apply to the denaturalization provision,

which merely deprives the alien “of a privilege that was never

rightfully his” and “imposes no punishment upon an alien

who has previously procured a certificate of citizenship by

fraud or other illegal conduct.” Id. (emphasis added).

After the INA was enacted, a plurality of the Court

reiterated that “[d]enaturalization is not imposed to penalize

the alien for having falsified his application for citizenship.”

Trop, 356 U.S. at 98–99 (“Rather, [denaturalization] is

imposed in the exercise of the power to make rules for the

naturalization of aliens.”). The Seventh Circuit has followed

this guidance, holding that “denaturalization proceedings are

not criminal in nature and do not inflict punishment,” but

rather “work[] to deprive the naturalized citizen of a privilege

that should never have been bestowed.” United States v.

Kairys, 782 F.2d 1374, 1383 (7th Cir. 1986).

Phattey argues that these decisions have been superseded

by the Supreme Court’s subsequent decision in Kokesh v.

SEC, 137 S. Ct. 1635 (2017). Kokesh considered whether

§ 2462 applied to disgorgement actions brought by the

Securities Exchange Commission (SEC) to enforce violations

10 UNITED STATES V. PHATTEY

of federal securities laws. Id. at 1639. The Court explained

that the statute of limitations imposed by § 2462 would apply

in this context only “if SEC disgorgement qualifies as either

a fine, penalty, or forfeiture.” Id. at 1642. In considering

whether disgorgement qualified as a penalty, the Court first

defined “penalty” to mean “a punishment, whether corporal

or pecuniary, imposed and enforced by the State, for a crime

or offense against its laws.” Id. (internal quotation marks and

alterations omitted) (quoting Huntington v. Attrill, 146 U.S.

657, 667 (1892)). According to the Court, “[t]his definition

gives rise to two principles.” Id. First, “whether a sanction

represents a penalty turns in part on whether the wrong

sought to be redressed is a wrong to the public, or a wrong to

the individual.” Id. (internal quotation marks and citation

omitted). Private causes of action are not penalties, because

“[p]enal laws, strictly and properly, are those imposing

punishment for an offense committed against the State.” Id.

(citation omitted). Second, “a pecuniary sanction operates as

a penalty only if it is sought for the purpose of punishment,

and to deter others from offending in like manner—as

opposed to compensating a victim for his loss.” Id. (citation

omitted).

Applying these principles, the Supreme Court concluded

that the SEC’s use of disgorgement constituted a penalty

under § 2462. Id. at 1643. Looking at its first principle, the

Court reasoned that disgorgement seeks to “remedy harm to

the public at large” rather than vindicate harm to a particular

victim. Id. at 1643 (citation omitted). Turning to the second

principle, the Court held that deterrence was not merely an

“incidental effect” of disgorgement. Id. Rather, “[t]he

primary purpose of disgorgement orders is to deter violations

of the securities laws by depriving violators of their ill-gotten

gains.” Id. (emphasis added) (quoting SEC v. Fischbach

UNITED STATES V. PHATTEY 11

Corp., 133 F.3d 170, 175 (2d Cir. 1997)). The Court

acknowledged that a disgorgement may also serve

compensatory goals, but because “disgorgement orders go

beyond compensation, are intended to punish, and label

defendants wrongdoers as a consequence of violating public

laws, they represent a penalty and thus fall within the 5–year

statute of limitations of § 2462.” 137 S. Ct. at 1645 (internal

quotation marks and citation omitted).

The Court rejected the government’s argument that “SEC

disgorgement is not punitive but ‘remedial’ in that it lessens

the effects of a violation by restoring the status quo.” Id. at

1644 (internal quotation marks omitted). The Court stated

that “it is not clear that disgorgement, as courts have applied

it in the SEC enforcement context, simply returns the

defendant to the place he would have occupied had he not

broken the law,” because “SEC disgorgement sometimes

exceeds the profits gained as a result of the violation.” Id. at

1644. In such instances, “disgorgement does not simply

restore the status quo; it leaves the defendant worse off.” Id.

at 1645. Because SEC disgorgement addressed a public

wrong, and has the primary purpose of deterrence and

punishment, it constitutes a penalty for purposes of the

§ 2462 statute of limitations. Id.

Under the principles set out in Kokesh, revocation of

citizenship does not qualify as a “penalty.” Although the

wrong sought to be redressed by § 1451(a) is a wrong to the

public, revocation of citizenship is not sought for the purpose

of punishment or to deter future violations. See Trop,

356 U.S. at 98–99. Rather, as the Supreme Court has already

concluded, the purpose of denaturalization is to remedy a past

fraud by taking back a benefit to which the alien is not

entitled and thus restoring the status quo ante. See

12 UNITED STATES V. PHATTEY

Johannessen, 225 U.S. at 242; United States v. Koziy,

728 F.2d 1314, 1320 (11th Cir. 1984) (holding that

denaturalization “deprived [the alien] of a privilege that was

never rightfully his”). Instead of imposing a punishment,

denaturalization “simply returns the [alien] to the place he

would have occupied had he not broken the law.” Kokesh,

137 S. Ct. at 1644. Congress clearly knows how to impose

criminal penalties for immigration fraud, see, e.g., 18 U.S.C.

§ 1015 (mandating imprisonment for false statements under

oath relating to naturalization); 18 U.S.C. § 1546 (mandating

imprisonment or a fine for counterfeit immigration

documents); 8 U.S.C. § 1325(c) (mandating imprisonment or

a fine for marriage fraud), but chose not to do so in enacting

§ 1451(a).

Although § 1451(a) on its face merely restores the status

quo ante, Phattey nevertheless argues that the threat of

denaturalization has the effect of deterring aliens from

making fraudulent representations in naturalization

proceedings, and therefore constitutes a penalty. But Phattey

here improperly equates the purposes of sanctions with their

effects, whether intended or not. The Supreme Court has

determined that a sanction is a penalty only if it is sought for

the purpose of punishment or deterrence. Kokesh, 137 S. Ct.

at 1642. The incidental effect of a sanction is irrelevant. See

id. at 1643 (holding that disgorgement is a penalty where

“deterrence is not simply an incidental effect of

disgorgement” but rather its “primary purpose”). While

Phattey may be correct that denaturalization will have a

deterrent effect as a practical matter, the purpose of

revocation proceedings is to revoke a wrongfully obtained

benefit, rather than deterrence. See Johannessen, 225 U.S. at

242. Phattey further argues that denaturalization qualifies as

a penalty due to its negative collateral effects on the alien’s

UNITED STATES V. PHATTEY 13

family members whose citizenship was obtained “through the

naturalization of a parent or spouse.” See 8 U.S.C. § 1451(d).

But § 1451’s incidental effect on third parties, whose

citizenship was necessarily also obtained as a result of fraud,

similarly serves to restore the status quo ante, rather than to

act as a deterrent.

Because denaturalization proceedings do not constitute a

penalty for purposes of 28 U.S.C. § 2462, that statute does

not provide Phattey a statute-of-limitations defense.

Accordingly, the district court did not err in entering

summary judgment in favor of the government.

AFFIRMED.