468 U.S. 222 (1984), 83-436, Regan v. Wald

Docket Nº:No. 83-436
Citation:468 U.S. 222, 104 S.Ct. 3026, 82 L.Ed.2d 171
Party Name:Regan v. Wald
Case Date:June 28, 1984
Court:United States Supreme Court
 
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468 U.S. 222 (1984)

104 S.Ct. 3026, 82 L.Ed.2d 171

Regan

v.

Wald

No. 83-436

United States Supreme Court

June 28, 1984

Argued April 24, 1984

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE FIRST CIRCUIT

Syllabus

Treasury Department Regulation 201(b), first promulgated in 1963 as part of the Cuban Assets Control Regulations, prohibits [104 S.Ct. 3028] any transaction involving property in which Cuba, or any national thereof, has "any interest of any nature whatsoever, direct or indirect." Regulation 560, which was added to the Regulations in 1977, embodied a general license permitting, for the most part, travel-related economic transactions with Cuba, thus exempting such transactions from Regulation 201(b)'s broad prohibition. But in 1982, Regulation 560 was amended to curtail such general license by permitting only certain types of travel, such as official visits, news gathering, and visits to close relatives, and excluding general tourist and business travel. At the time Regulation 201(b) was promulgated, § 5(b) of the Trading With the Enemy Act (TWEA) gave the President broad authority to impose comprehensive embargoes on foreign countries as one means of dealing with both peacetime emergencies and times of war. The Cuban Assets Control Regulations constitute such an embargo. Section 5(b) was amended in 1977 to limit the President's power under the TWEA to times of war, but at the same time, the International Emergency Economic Powers Act (IEEPA) was enacted to cover the President's exercise of emergency economic powers in response to peacetime crises, § 203 of that Act granting essentially the same authorities to the President as those in § 5(b) of TWEA. However, rather than requiring the President to declare a new national emergency in order to continue existing economic embargoes, such as that against Cuba, Congress enacted a grandfather clause providing that, notwithstanding the amendment to TWEA, the "authorities conferred upon the President" by § 5(b), which were being exercised with respect to a country on July 1, 1977, as a result of a national emergency declared by the President before such date, "may continue to be exercised." Respondents, American citizens who are inhibited from traveling to Cuba by Regulation 201(b), brought an action in Federal District Court, challenging the 1982 amendment to Regulation 560 and seeking a preliminary injunction against its enforcement. The District Court refused to issue the injunction on the ground that respondents had not demonstrated a substantial likelihood of success on the merits. The Court of

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Appeals, holding that the challenged amendment lacked statutory authority, vacated the District Court's order and remanded with instructions to issue the injunction.

Held:

1. The grandfathered authorities of § 5(b) of TWEA provide an adequate statutory basis for the challenged 1982 amendment to Regulation 560. Pp. 232-240.

(a) The language of the grandfather clause, read in conjunction with § 5(b), supports the conclusion that, in the relevant sense, the "authority" to regulate all property transactions with Cuba, including travel-related transactions, was being exercised on July 1, 1977, and was, therefore preserved. Since the authority to regulate travel-related transactions was among the "authorities conferred upon the President" by § 5(b) that were "being exercised" with respect to Cuba on July 1, 1977, it follows from a natural reading of the grandfather clause that the authority to regulate such transactions "may continue to be exercised" with respect to Cuba after that date. And since the President's authority under § 5(b) to regulate by means of licenses includes the authority to "prevent or prohibit" as well as the authority to "direct and compel," it also follows that the grandfather clause constitutes adequate statutory authority for the 1982 amendment of Regulation 560, the practical effect of which was to prevent travel to Cuba. Pp. 232-236.

(b) Neither the legislative history of the grandfather clause nor its purpose of keeping IEEPA and the amendments to TWEA from being too controversial supports the view that Congress meant to grandfather only those restrictions actually in place on July 1, 1977. Eliminating the President's authority to modify existing licenses in response to heightened tensions with Cuba would have sparked just the sort of controversy the grandfather clause was designed to avoid. Pp. 236-240.

2. The restrictions on travel-related transactions with Cuba imposed by the 1982 amendment to Regulation 560 do not [104 S.Ct. 3029] violate the freedom to travel protected by the Due Process Clause of the Fifth Amendment. Cf. Zemel v. Rusk, 381 U.S. 1. Given the traditional deference to executive judgment in the realm of foreign policy, there is an adequate basis under the Due Process Clause to sustain the President's decision to curtail, by restricting travel, the flow of hard currency to Cuba that could be used in support of Cuban adventurism. Pp. 240-243.

708 F.2d 794, reversed.

REHNQUIST, J., delivered the opinion of the Court, in which BURGER, C.J., and WHITE, STEVENS, and O'CONNOR, JJ., joined. BLACKMUN, J., filed a dissenting opinion, in which BRENNAN, MARSHALL, and POWELL,

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JJ., joined, post, p. 244. POWELL, J., filed a dissenting opinion, post, p. 262.

REHNQUIST, J., lead opinion

JUSTICE REHNQUIST delivered the opinion of the Court.

Respondents are American citizens who want to travel to Cuba. They are inhibited from doing so by a Treasury Department regulation, first promulgated in 1963, which prohibits any transaction involving property in which Cuba, or any national thereof, has "any interest of any nature whatsoever, direct or indirect." 31 CFR § 515.201(b) (1983) (Regulation 201(b)). For a period of about five years, "transactions ordinarily incident to" travel to and from as well as within Cuba were, with some limitations, exempted from the broad prohibition of Regulation 201(b) by a general license. See 31 CFR § 515.560 (1983). But this general license was amended in 1982, and the scope of permissible economic transactions in connection with travel to Cuba was significantly narrowed. 47 Fed.Reg. 17030 (1982).

Respondents challenged the amendment to the general license on constitutional and statutory grounds and sought a preliminary injunction against its enforcement. The District Court for the District of Massachusetts concluded that respondents had not demonstrated a substantial likelihood of

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success on the merits and refused to issue the injunction. App. to Pet. for Cert. 22a. On appeal taken by respondents, the Court of Appeals for the First Circuit, concluding that the challenged amendment lacked statutory authority, vacated the District Court's order and remanded with instructions to issue the preliminary injunction. 708 F.2d 794 (1983). We granted the Government's application for a stay of the mandate, 463 U.S. 1223 (1983), as well as the petition for certiorari, 464 U.S. 990 (1983), and now reverse the judgment of the Court of Appeals.

I

Regulation 201(b) was promulgated in 1963 as part of the Cuban Assets Control Regulations, 31 CFR pt. 515 (1963), implemented under the Trading With the Enemy Act of 1917 (TWEA), 40 Stat. 411, as amended, 50 U.S.C.App. § 1 et seq. See 28 Fed.Reg. 6974 (1963).1 At that time, § 5(b) of TWEA gave the President broad authority to impose comprehensive embargoes on foreign countries as one means of

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dealing with both peacetime emergencies and times of war.2 The Cuban Assets Control Regulations constitute such an embargo.3 They were originally adopted to deal with the peacetime emergency created by Cuban attempts to destabilize governments throughout Latin America. See Presidential Proclamation No. 3447, 3 CFR 157 (1959-1963 Comp.).4

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"[E]xcept as specifically authorized by the Secretary of the Treasury," Regulation 201(b) prohibits all

transactions involv[ing] property in which [Cuba], or any national thereof, has . . . any interest of any nature whatsoever, direct or indirect. . . .

31 CFR § 515.201(b) (1983).

In 1977, Regulation 560 was added to the Cuban Assets Control Regulations. See 31 CFR § 515.560 (1977).5 Regulation 560 embodied a general license permitting "persons who visit Cuba to pay for their transportation and maintenance expenditures (meals, hotel bills, taxis, etc.) while in Cuba." 42 Fed.Reg. 16621 (1977). Thus, travel-related economic transactions with Cuba were, for the most part, exempted from the complete embargo of Regulation 201(b).6 All persons engaging in travel-related transactions, however, were required to make "a full and accurate record of each such transaction" and to keep those records available for inspection for at least two years. § 515.601. And the general license contained in Regulation 560 was subject to revocation or modification "at any time." § 515.805.

Later in 1977, § 5(b) of TWEA was amended to limit the President's power to act pursuant to that statute solely to times of war.7 In the same bill, a new law was enacted to

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cover the President's exercise of emergency economic powers in response to peacetime crises. International Emergency Economic Powers Act (IEEPA), Title II, Pub.L. 95-223, 91 Stat. 1626 et seq., codified at 50 U.S.C. § 1701 et seq. The authorities granted to the President by § 203 of IEEPA are essentially the same as [104 S.Ct. 3031] those in § 5(b) of TWEA,8 but the conditions and procedures for their exercise are different.

Section 202(a) of IEEPA provides that the authorities granted the President by § 203

may be exercised to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside...

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