United States v. 2006-04-17 | 02-50355 | USA VRAHMANI | precedential | opinion |

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
 UNITED STATES OF AMERICA,
Plaintiff-Appellant,
No. 02-50355v.
D.C. No.HOSSEIN AFSHARI, aka Hosseini CR-01-00209-RMTDeklami; MOHAMMAD OMIDVAR; Central District  HASSAN REZAIE; ROYA RAHMANI, of California,aka Sister Tahmineh; NAVID TAJ, Los Angelesaka Najaf Eshkoftegi; MUSTAFA
AHMADY; ALIREZA MOHAMAD ORDER
MORADI,
Defendants-Appellees. 
Filed April 17, 2006
Before: Andrew J. Kleinfeld, Kim McLane Wardlaw, and
William A. Fletcher, Circuit Judges.
Order;
Dissent by Judge Kozinski
ORDER
The panel has voted unanimously to deny the petition for
rehearing and petition for rehearing en banc.
The full court has been advised of the petition for rehearing
en banc. A judge of the court requested a vote on whether to
rehear the matter en banc. The matter failed to receive a
majority of the votes of the nonrecused active judges in favor
of en banc consideration. Fed. R. App. P. 35(b).
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The petition for rehearing and the petition for rehearing en
banc are DENIED.
KOZINSKI, Circuit Judge, with whom Judges PREGERSON,
REINHARDT, THOMAS and PAEZ join, dissenting from
denial of rehearing en banc:
It goes without saying that the United States government
may prohibit donations to terrorist organizations. As we
explained in Humanitarian Law Project v. Reno, 205 F.3d
1130, 1133 (9th Cir. 2000), money is fungible; if an organiza-
tion engages in terrorism, it can channel money donated to it
for humanitarian and advocacy purposes to promote its grisly
agenda. At the same time, however, giving money to a politi-
cal organization that is not engaged in terrorist activities is
constitutionally protected. The determination of whether or
not an organization is engaged in terrorism is therefore cru-
cial, because it distinguishes activities that can be criminal-
ized from those that are protected by the First Amendment.
This case concerns the manner in which this distinction is
drawn. Because designating an organization as terrorist cuts
off the First Amendment rights of individuals wishing to
donate to that organization, the designation must meet certain
constitutional standards. The Supreme Court has twice spoken
to the question of how the government may go about turning
what would otherwise be protected First Amendment speech
into criminal conduct, the first time in Freedman v. Maryland,
380 U.S. 51 (1965), and the second time in McKinney v. Ala-
bama, 424 U.S. 669 (1976). In both cases, the Court laid out
strict rules that the government must follow, yet the designa-
tion in this case complies neither with Freedman nor with
McKinney. The net result is that Rahmani is being criminally
prosecuted, and almost certainly will be convicted, for con-
tributing to an organization that has been designated as terror-
ist with none of the protections that are constitutionally
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required for such a designation. Worse, Rahmani will in all
likelihood spend many years in prison for contributing to an
organization whose designation the D.C. Circuit has held does
not even meet the requirements of due process. Because I
believe that the prosecution in this case runs contrary to two
of our defining traditions—that of free and open expression,
and that of justice and fair play—I respectfully dissent from
the court’s failure to correct the panel’s errors by taking this
case en banc.
Background
Anyone who “knowingly provides material support or
resources to a foreign terrorist organization, or attempts or
conspires to do so” faces up to 10 years in prison. 18 U.S.C.
§ 2339B(a)(1).1 A foreign “terrorist organization” is defined
as any organization so designated by the Secretary of State
under 8 U.S.C. § 1189(a)(1).2
Roya Rahmani was indicted under 18 U.S.C. § 2339B for
making monetary contributions to the Mujahedin-e-Khalq
(MEK), also known as the People’s Mojahedin Organization
for Iran, between 1997 and 2001. See United States v. Rah-
mani, sub nom. United States v. Afshari, 426 F.3d 1150, 1152
(9th Cir. 2005). MEK is opposed to the current fundamentalist
regime in Iran. See People’s Mojahedin Org. of Iran v. Dep’t
of State, 182 F.3d 17, 20-21 (D.C. Cir. 1999) (“PMOI I”). It
was first designated a terrorist organization in 1997, and was
re-designated in 1999 and 2001. See id. at 18; Nat’l Council
of Resistance of Iran v. Dep’t of State, 251 F.3d 192, 197
(D.C. Cir. 2001) (“PMOI II”); People’s Mojahedin Org. of
Iran v. Dep’t of State, 327 F.3d 1238, 1241 (D.C. Cir. 2003)
1The maximum sentence was increased to 15 years in 2001. See USA
PATRIOT Act, Pub. L. No. 107-56, § 810(d), 115 Stat. 272, 380 (2001).
2All references to 8 U.S.C. § 1189 are to the version in place before the
2001 and 2004 amendments.
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(“PMOI III”); cf. 8 U.S.C. § 1189(a)(4) (requiring re-
designation every two years).
Rahmani argues that MEK is not a terrorist organization,
but the crime isn’t defined as providing support to an organi-
zation that is terrorist, only to one that is designated as such
under 8 U.S.C. § 1189. Further, she is statutorily barred from
arguing that the organization is not terrorist in nature, and
therefore that her contribution is constitutionally protected.
See 8 U.S.C. § 1189(a)(8). Not to worry, says the panel; the
organization itself can challenge the designation, so Rah-
mani’s First Amendment rights are adequately protected.
The organization’s challenges in this case, however, proved
futile. MEK brought a legal challenge each time it was desig-
nated, under the judicial review provision of the governing
statute: “The [D.C. Circuit] Court shall hold unlawful and set
aside a designation the court finds to be . . . contrary to consti-
tutional right, power, privilege, or immunity.” 8 U.S.C.
§ 1189(b)(3)(B). When the D.C. Circuit reviewed MEK’s
1997 designation, however, it found the organization lacked
due process rights and thus could not challenge the designa-
tion. See PMOI I, 182 F.3d at 22, 25. When MEK was re-
designated in 1999 and challenged its new designation, the
D.C. Circuit reached the merits3 and found that the designa-
tion violated due process because the government did not pro-
vide MEK with notice or an opportunity to be heard. See
PMOI II, 251 F.3d at 196, 208-09. But, instead of setting the
designation aside as the statute requires, see 8 U.S.C.
§ 1189(b)(3)(B), the court left the designation in place and
remanded the case to the Secretary of State for further pro-
3The D.C. Circuit reviewed the merits of the due process challenge to
the designation the second time around only because the State Department
had identified another organization—the National Council of Resistance
of Iran (NCRI)—as MEK’s “alias.” NCRI had enough of a presence in the
United States to assert a due process claim. See Rahmani, 426 F.3d at
1153.
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ceedings, see PMOI II, 251 F.3d at 209. On remand, the Sec-
retary promptly re-designated MEK a terrorist organization
retroactively for the two-year period ending in 2001. See
PMOI III, 327 F.3d at 1241. The D.C. Circuit did not uphold
this retroactive designation until 2003. See id. at 1245.
It is these designations—one of which was found to be
unreviewable, one of which was found to be unconstitutional,
and the last of which was adopted retroactively—that form
the basis of the government’s prosecution of Rahmani.
Discussion
It is firmly established that monetary contributions to politi-
cal organizations are a form of “speech” protected by the First
Amendment, see McConnell v. Fed. Election Comm’n, 540
U.S. 93, 134-36 (2003); Buckley v. Valeo, 424 U.S. 1, 16
(1976) (per curiam), the panel’s statements to the contrary
notwithstanding, see Rahmani, 426 F.3d at 1159-60 (“[W]hat
the defendants propose to do is not to engage in speech, but
rather to provide material assistance . . . [by] sending money
to the MEK.”); id. at 1160 (“[T]he money sent to the MEK
is not [speech].”). In Humanitarian Law Project, 205 F.3d at
1133, we held that giving money to a designated terrorist
organization is not protected speech. But if the organization
is not a designated terrorist organization, then monetary con-
tributions to it are protected by the First Amendment—maybe
not to the same degree as pure speech, but protected nonethe-
less. A terrorist designation is thus a type of prior restraint on
speech, because it criminalizes monetary contributions that
would otherwise be protected by the First Amendment.
The panel dismisses Rahmani’s First Amendment argu-
ments with conclusory statements that the money here is
being given to a terrorist organization, and is therefore a com-
pletely unprotected form of expression. See Rahmani, 426
F.3d at 1160 (“Donations to designated foreign terrorist orga-
nizations are not akin to donations to domestic political par-
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ties or candidates.”). But this begs the question. The crux of
the case—the issue the panel has elided in each iteration of its
opinion—is the process by which the designation was made.
If the designation process does not comply with constitutional
standards, then the designation is invalid and Rahmani’s
donations are protected by the First Amendment. In order to
determine whether that process was constitutional, we must
rely on the guidance of Freedman v. Maryland, 380 U.S. 51
(1965), and McKinney v. Alabama, 424 U.S. 669 (1976).
1. “[A]ny system of prior restraints of expression comes to
this Court bearing a heavy presumption against its constitu-
tional validity.” Freedman, 380 U.S. at 57 (quoting Bantam
Books, Inc. v. Sullivan, 372 U.S. 58, 70 (1963)) (internal quo-
tation marks omitted). In Freedman, the Supreme Court
detailed the “procedural safeguards” that must accompany
prior restraints on speech, setting a high hurdle for the gov-
ernment to clear before a restraint can be held constitutional.
Id. at 58. Freedman concluded that “only a judicial determi-
nation in an adversary proceeding ensures the necessary sen-
sitivity to freedom of expression, [thus] only a procedure
requiring a judicial determination suffices to impose a valid
final restraint.” Id. (emphasis added). The panel ignores
Freedman entirely, upholding a prior restraint on speech that
contains not a single one of Freedman’s procedural safe-
guards.
In Freedman, the Supreme Court struck down a Maryland
censorship scheme in which theaters were banned—on pen-
alty of criminal prosecution—from showing films designated
as obscene:
It is readily apparent that the Maryland procedural
scheme does not satisfy [constitutional] criteria.
First, once the censor disapproves the film, the
exhibitor must assume the burden of instituting judi-
cial proceedings and of persuading the courts that
the film is protected expression. Second, once the
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Board has acted against a film, exhibition is prohib-
ited pending judicial review, however protracted.
Under the statute, appellant could have been con-
victed if he had shown the film after unsuccessfully
seeking a license, even though no court had ever
ruled on the obscenity of the film. Third, it is abun-
dantly clear that the Maryland statute provides no
assurance of prompt judicial determination. We
hold, therefore, that appellant’s conviction must be
reversed. The Maryland scheme fails to provide ade-
quate safeguards against undue inhibition of pro-
tected expression, and this renders the § 2
requirement of prior submission of films to the
Board an invalid previous restraint.
Id. at 59-60 (emphasis added).
The procedure for designating a foreign terrorist organiza-
tion has all of the deficiencies identified by the Supreme
Court in Freedman, and then some. First, once the Secretary
of State makes the designation, the prohibition on monetary
contributions takes effect immediately, see 8 U.S.C.
§ 1189(a)(2)(B)(i), and “the burden of instituting judicial pro-
ceedings and of persuading the courts” that the designation
was improper, Freedman, 380 U.S. at 60, falls on the organi-
zation. See 8 U.S.C. § 1189(b)(1).
Second, monetary contributions to a designated organiza-
tion are prohibited even while judicial review is pending. See
id. §§ 1189(a)(2)(B)(i), (b)(4) (“The pendency of an action for
judicial review of a designation shall not affect the application
of this section, unless the court issues a final order setting
aside the designation.”); Freedman, 380 U.S. at 60. This pro-
cedural deficiency is particularly damaging to Rahmani, who
made all her donations at least two years before the D.C. Cir-
cuit finally approved MEK’s designation as a terrorist organi-
zation.
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Third, “it is abundantly clear that the . . . statute provides
no assurance of prompt judicial determination.” Id. To the
contrary, the statute seems to discourage any judicial determi-
nation at all, giving the organization only 30 days to challenge
its designation. See id. § 1189(b)(1). What’s more, the panel
concedes that the D.C. Circuit has found foreign entities have
no due process rights: “MEK was a ‘foreign entity without . . .
presence in this country’ and thus ‘ha[d] no constitutional
rights under the due process clause.’ Therefore, the MEK was
not entitled to notice and a hearing.” Rahmani, 426 F.3d at
1153 (quoting PMOI I, 182 F.3d at 22) (alterations in origi-
nal) (footnote omitted). In other words, the only entity that is
statutorily eligible to challenge the terrorist designation—the
organization being designated—will ordinarily be unable to
bring any kind of meaningful4 challenge. See 8 U.S.C.
§§ 1189(a)(1)(A), (a)(8), (b)(1).
Even when an organization can avail itself of the full “judi-
cial review” prescribed by the statute, see id. §§ 1189(b)(2) &
(3), such review comes nowhere near what Freedman
requires. The statute uses “APA-like language,” PMOI I, 182
F.3d at 22, barring the D.C. Circuit from overturning the Sec-
retary’s designation unless, for example, it lacks substantial
evidence or is arbitrary and capricious. See 8 U.S.C.
§ 1189(b)(3). As the D.C. Circuit noted, under the statute’s
judicial review provisions, the designated organization “does
not have the benefit of meaningful adversary proceedings . . .
other than procedural shortfalls so obvious a Secretary of
State is not likely to commit them.” PMOI II, 251 F.3d at 197.
But Freedman explicitly requires a “judicial determination in
an adversary proceeding” on the merits, not merely a court’s
4I say “meaningful” challenge because, despite finding that MEK had
no due process rights, the D.C. Circuit did conduct some review of the
Secretary’s designation as required by the statute. See 8 U.S.C.
§ 1189(b)(3). But all the D.C. Circuit could do was glance at the Secre-
tary’s one-sided evidence. “[N]ot surprisingly,” the D.C. Circuit found
nothing in the Secretary’s materials to support MEK’s argument that it
was erroneously designated. PMOI I, 182 F.3d at 24.
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cursory check that the agency followed its own procedures.
380 U.S. at 58 (emphasis added). And Freedman underscores
the inadequacy of any agency for making such a judicial
determination: “[T]here inheres the danger that [an agency]
may well be less responsive than a court—part of an indepen-
dent branch of government—to the constitutionally protected
interests in free expression.” Id. at 57-58.
As in Freedman, the only possible conclusion is that the
terrorist organization designation scheme “fails to provide
adequate safeguards against undue inhibition of protected
expression,” and therefore is an invalid prior restraint. Id. at
60.
The procedural history of this case perfectly illustrates the
patent unconstitutionality of the terrorist organization desig-
nation process: Rahmani was indicted for sending money to
MEK from 1997 to 2001, the very years during which the des-
ignation was admittedly unconstitutional.5 Had the D.C. Cir-
cuit followed the letter of the statute, it would have struck
down the designation, see 8 U.S.C. § 1189(b)(3)(B), and Rah-
mani could not have been charged with a crime. The State
Department could, of course, have re-designated MEK in
2001 using constitutional procedures, but it could not have
retroactively designated it to criminalize Rahmani’s donations.6
See U.S. Const. art. I, § 9, cl. 3 (Ex Post Facto Clause).
5Only the 1999 designation was declared unconstitutional by the D.C.
Circuit. See PMOI II, 251 F.3d at 197. But the 1999 designation “extended
the . . . 1997 designation,” the constitutionality of which the court never
reached in PMOI I. See id. The process by which the organization was
designated had not changed from 1997 to 1999, so if one was unconstitu-
tional then the other was as well. After PMOI II was decided, the designa-
tion process was amended to redress the due process problems identified
by the court. See USA PATRIOT Act § 411(c); PMOI II, 251 F.3d at 208-
09.
6In crafting its remand to the Secretary of State, the D.C. Circuit did not
seem to be aware of the effect the designation plays in criminal prosecu-
tions. See PMOI II, 251 F.3d at 209. In fact, it explicitly pointed to “the
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No “judicial determination” upheld MEK’s designation on
its merits until two years after Rahmani made her allegedly
criminal monetary contributions. Cf. Freedman, 380 U.S. at
58. The panel thus condones a uniquely unconstitutional (and
oxymoronic) practice: an ex post facto prior restraint. The
simple fact is that Rahmani is being prosecuted—and will
surely be sent to prison for up to 10 years—for giving money
to an organization that no one other than some obscure man-
darin in the bowels of the State Department had determined
to be a terrorist organization. The panel has simply overruled
Freedman—without so much as mentioning it.
2. The panel’s opinion also contravenes McKinney v. Ala-
bama, 424 U.S. 669 (1976). McKinney involved a criminal
defendant charged with selling a magazine that had previously
been declared obscene in a separate in rem action. The
Supreme Court, in an opinion by Justice Rehnquist, held that
the defendant had a right to argue at his own trial that the
magazine was not actually obscene and was thus protected by
the First Amendment. See id. at 674-76. McKinney thus stands
for the proposition that a criminal defendant has an individual
right to challenge the exclusion of what would otherwise be
protected speech from the protection of the First Amendment.
timeline against which [it was] operating,” noting that “the two-year des-
ignations before us expire in October of this year.” Id. In other words, it
didn’t much matter whether the designation was revoked or whether the
case was simply remanded for curative measures; even if the civil conse-
quences of MEK’s designation had been lifted, they could have been reim-
posed almost immediately when MEK was re-designated.
The same cannot be said for criminal prosecutions premised on the des-
ignation: Contributing material support to an organization not designated
a terrorist organization cannot subject a person to criminal sanction just
because the same organization is later so designated. Had the D.C. Circuit
revoked MEK’s designation in 2001—as it was required to do under the
statute—Rahmani’s donations from 1997 to 2001 would have been per-
fectly legal, even if MEK was subsequently re-designated.
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The panel here holds that, because MEK had an opportu-
nity to challenge its terrorist designation, see 8 U.S.C.
§ 1189(b)(1), Rahmani can be precluded from arguing in her
own defense that MEK is not actually a terrorist organization.
It is not at all clear to me that a constitutional challenge that
can (maybe) be raised only by a third party in a separate pro-
ceeding can ever be an adequate substitute for the procedures
specified in McKinney. Assuming, however, that such a third-
party procedure is constitutionally permissible, on the theory
perhaps that mere political contributions do not merit the
same lofty constitutional protection as the smutty magazines
in McKinney, what actually happened in this case surely can-
not be sufficient to strip Rahmani of all First Amendment pro-
tections. As will be recalled, MEK did litigate its designation
in the courts and the designation was held to be unconstitu-
tional. This is how the D.C. Circuit described the procedure
used:
The unique feature of this statutory procedure is the
dearth of procedural participation and protection
afforded the designated entity. At no point in the
proceedings establishing the administrative record is
the alleged terrorist organization afforded notice of
the materials used against it, or a right to comment
on such materials or the developing administrative
record. . . . The Secretary may base the findings on
classified material, to which the organization has no
access at any point during or after the proceeding to
designate it as terrorist. . . . Thus the entity does not
have the benefit of meaningful adversary proceed-
ings on any of the statutory grounds, other than pro-
cedural shortfalls so obvious a Secretary of State is
not likely to commit them.
PMOI II, 251 F.3d at 196-97. This is the process the panel
holds is sufficient to extinguish Rahmani’s First Amendment
rights. What good is the organization’s right to challenge its
designation if the outcome—in this case, that the designation
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was unconstitutional—is entirely ignored? Moreover, how
can a procedure that was judicially determined to violate due
process be an adequate substitute for the type of direct chal-
lenge that McKinney requires?
The McKinney portion of the panel’s opinion is premised
on the fact that the organization was properly designated as a
terrorist organization, and that the designation had already
been subject to judicial review. The panel states:
What is at issue here is not anything close to pure
speech. It is, rather, material support to foreign orga-
nizations that the United States has deemed, through
a process defined by federal statute and including
judicial review by the D.C. Circuit, a threat to our
national security. . . . The “foreign terrorist organiza-
tion” designation means that the Executive Branch
has determined—and the D.C. Circuit, in choosing
not to set aside the designation, has concluded that
the determination was properly made—that materi-
ally supporting the organization is materially sup-
porting actual violence.
Rahmani, 426 F.3d at 1160 (emphasis added). But, as
described above, the D.C. Circuit explicitly concluded that the
designation in this case was not “properly made.” Thus, the
panel’s argument—the very foundation of its attempt to dis-
tinguish this case from McKinney—is entirely beside the
point.
Without a proper designation, the money being donated
here cannot be deemed anything other than a donation to a
legitimate foreign political organization—much closer to the
“pure speech” at issue in McKinney. Monetary donations may
not receive the full strict scrutiny protection that pure political
speech receives, see McConnell, 540 U.S. at 137, but height-
ened scrutiny still applies, see id. at 143 (holding that cam-
paign contributions can be limited because “the prevention of
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corruption or its appearance constitutes a sufficiently impor-
tant interest” (emphasis added)).
The panel’s final attempt to distinguish this case from
McKinney based on “deference [to] the Executive Branch in
the area of national security” fares no better. Rahmani, 426
F.3d at 1161. What possible relevance could national security
have once the terrorist designation was declared unconstitu-
tional? The panel pretends the designation was valid and that
it can therefore refer to MEK as a terrorist organization. But
until such a determination is properly made, asserting the
presence of a national security concern is mere speculation—
hardly a sufficient substitute for the individual procedural
right granted in McKinney.
3. Why does the panel ignore common sense and find this
whole scheme constitutional? Because, it says, it “do[es] not
have authority to reverse the decisions of a sister circuit,” id.
at 1156, and “it would be contrary to the statutory scheme for
us to hold that the designation was invalid,” id. at 1157. But
the remedy Rahmani seeks requires neither: The D.C. Cir-
cuit’s opinion in PMOI II, which found the designation
unconstitutional but remanded to the Secretary of State with-
out setting the designation aside, said nothing about use of the
designation in criminal prosecutions; thus, there is nothing to
“reverse.” See PMOI II, 251 F.3d at 209; note 6 supra. Nor
is there a need to strike down the designation; the designation,
and the many civil consequences that flow from it, need not
be disturbed. See PMOI II, 251 F.3d at 196 (civil conse-
quences of designation include, for example, blocking funds
deposited with U.S. financial institutions and denying certain
members of the organization entry into the United States).
The panel need only hold that a designation found by the D.C.
Circuit to be unconstitutional cannot form the basis of a crimi-
nal prosecution.
* * *
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I can understand the panel’s reticence to interfere with mat-
ters of national security, but the entire purpose of the terrorist
designation process is to determine whether an organization
poses a threat to national security. Under the Constitution, the
State Department does not have carte blanche to label any
organization it chooses a foreign terrorist organization and
make a criminal out of anyone who donates money to it. Far
too much political activity could be suppressed under such a
regime.
In any event, our task in this case was simple. The D.C.
Circuit had already done all of the hard work, examining
MEK’s designation and finding it to be constitutionally inade-
quate. All we had to do was take the next logical step and
hold that this inadequate designation could not form the basis
for a criminal prosecution. The Supreme Court hasn’t hesi-
tated to take a close look at the constitutionality of certain war
on terror-related procedures—especially procedures that are
still being tested and developed. See, e.g., Hamdi v. Rumsfeld,
542 U.S. 507, 537-38 (2004). We should be no less vigilant.
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