In re National Sec. Agency Telecommunications Rec., MDL No. 06-1791 VRW.

• Decision Date: 02 July 2008
• Docket Number: MDL No. 06-1791 VRW.
• Citation: 564 F.Supp.2d 1109
• Parties: In re NATIONAL SECURITY AGENCY TELECOMMUNICATIONS RECORDS LITIGATION. This order pertains to: Al-Haramain Islamic Foundation et al v. Bush et al (C-07-0109 VRW).
• Court: U.S. District Court — Northern District of California

564 F.Supp.2d 1109

In re NATIONAL SECURITY AGENCY TELECOMMUNICATIONS RECORDS LITIGATION.

This order pertains to: Al-Haramain Islamic Foundation et al v. Bush et al (C-07-0109 VRW).

MDL No. 06-1791 VRW.

United States District Court, N.D. California.

July 2, 2008.

ORDER

VAUGHN R WALKER, Chief Judge.

The court of appeals has remanded the above case for this court "to consider whether FISA preempts the state secrets privilege and for any proceedings collateral to that determination." Al-Haramain Islamic Foundation, Inc. v. Bush, 507 F.3d 1190, 1206 (9th Cir.2007).

Plaintiffs' complaint alleges six causes of action of which the first is under the Foreign Intelligence Surveillance Act, 50 USC §§ 1801-71 ("FISA"). In that claim, plaintiffs allege in pertinent part:

Defendants' engagement in electronic surveillance to monitor conversations between and among plaintiffs as targeted persons without obtaining prior court authorization, and defendants' subsequent use of the information obtained against plaintiffs, is in violation of the civil and criminal provisions of FISA. As a result, all evidence obtained by this illegal surveillance must be suppressed pursuant to 50 USC § 1806(g). Further, plaintiffs are entitled to liquidated and punitive damages pursuant to 50 USC § 1810.

Complaint, Al-Haramain Islamic Foundation, Inc v. Bush, No C 06-0274 KI Doc # 1 ¶ 27, United States District Court for the District of Oregon, filed February 28, 2006.

Plaintiffs' other causes of action are for alleged violations of the "separation of powers" principle in the Constitution, the First, Fourth and Sixth amendments and the International Covenant on Civil and Political Rights. But it is to plaintiffs' FISA claims that the parties have directed their arguments and the court of appeals its attention. All of plaintiffs' claims would appear to depend on FISA. This order, therefore, devotes itself exclusively to FISA and the question posed by the court of appeals remand.

For the reasons stated herein, the court has determined that: (1) FISA preempts the state secrets privilege in connection with electronic surveillance for intelligence purposes and would appear to displace the state secrets privilege for purposes of plaintiffs' claims; and (2) FISA nonetheless does not appear to provide plaintiffs a viable remedy unless they can show that they are "aggrieved persons" within the meaning of FISA. The lack of precedents interpreting the remedial provisions of FISA, the failure of the parties to consider the import of FISA preemption and the undeveloped factual record in this case warrant allowing plaintiffs to attempt to make that showing and, therefore, support dismissal of the FISA claim with leave to amend.

Plaintiffs are the Al-Haramain Islamic Foundation, Inc, an Oregon non-profit corporation, and two of its individual attorneys, Wendell Belew and Asim Ghafoor, both United States citizens ("plaintiffs"). Plaintiffs brought suit in the United States District Court for the District of Oregon against "George W Bush, President of the United States, National Security Agency, Keith B Alexander, its Director, Office of Foreign Assets Control, an office of the United States Treasury, Robert W Werner, its Director, Federal Bureau of Investigation, Robert S Mueller, III, its Director" ("defendants"). Complaint at 1.

Along with their complaint, plaintiffs filed under seal a copy of a classified document that had inadvertently been disclosed by defendant Office of Foreign Assets Control ("OFAC") to counsel for Al-Haramain as part of a production of unclassified documents relating to Al-Haramain's potential status as a "specially designated global terrorist." Al-Haramain Islamic Foundation, Inc. v. Bush, 451 F Supp 2d 1215, 1218 (D.Or.2006).¹ This document which has proven central to all phases of this litigation including the issues now before this court, will be referred to herein as the "Sealed Document."

The complaint alleges that the National Security Agency ("NSA") conducted warrantless electronic surveillance of communications between a director or directors of Al-Haramain and the two attorney plaintiffs without regard to the procedures required by FISA, that the NSA turned over logs from this surveillance to OF AC and that OF AC then consequently froze Al-Haramain's assets. Id.

The Oregon district court entertained motions by the Oregonian Publishing Company to intervene in the suit and unseal records, by plaintiffs to compel discovery of information about the electronic surveillance of plaintiffs and regarding the reasons for classifying the Sealed Document and by defendants to prevent plaintiffs' access to the Sealed Document and to dismiss or, in the alternative, for summary judgment based on the state secrets privilege.

On September 7, 2006, the Oregon district court issued a lengthy opinion and order. Several points in that order remain salient to the matter now before this court. The court held that "plaintiffs need some information in the Sealed Document to establish their standing and a prima facie case, and they have no other available source for this information." Id. at 1221. It also held that given defendants' many public acknowledgments of the warrantless electronic surveillance program beginning in 2005, the program was not a secret. Id. at 1221-23. It rejected defendants' contention that litigation concerning the program would necessarily compromise national security and held that, contrary to defendants' contention, "the very subject matter of the case" was not a state secret. It ordered plaintiffs to deliver to the court all copies of the Sealed Document in their possession or under their control, to be deposited in the sealed compartmented information facility ("SCIF") provided by the Portland FBI office for the storage of classified documents. Id. at 1229. It denied without prejudice plaintiffs' request for discovery and denied the Oregonian's motion to unseal records. Id. at 1232.

The Oregon district court ruled that there was "no reasonable danger that the national security would be harmed if it is confirmed or denied that plaintiffs were subject to surveillance, but only as to the surveillance event or events disclosed in the Sealed Document" while also ruling that "disclosing whether plaintiffs were subject to any other surveillance efforts could harm the national security." Id. at 1224 (emphasis added). On the rationale that plaintiffs should be allowed to proceed based on the surveillance already disclosed to them, substantiated by evidence in a form yet to be determined, the court denied defendants' motion to dismiss: "plaintiffs should have an opportunity to establish standing and make a prima facie case, even if they must do so in camera." Id. at 1226-27.

The Oregon district court declined to reach one further issue presented to it by the parties—the issue this court is charged to decide on remand from the court of appeals:

Plaintiffs argue * * * that FISA preempts the state secrets privilege. Specifically, plaintiffs argue that FISA vests the courts with control over materials relating to electronic surveillance subject to "appropriate security procedures and protective orders." 50 USC § 1806(f). As a result, plaintiffs contend that Section 1806(f) renders the state secrets privilege superfluous in FISA litigation.

Id. at 1229.

The Oregon district court summarized defendants' argument to be that section 1806(f) only benefits the government—that it exists, in essence, for the sole purpose of providing for in camera review of documents and information the government intends to use against a criminal defendant. The Oregon district court quoted section 1810, FISA's civil liability provision, together with FISA's definition of an "aggrieved person" entitled to sue under section 1810 (see infra Part III) and observed: "[t]o accept the government's argument that Section 1806(f) is only applicable when the government intends to use information against a party would nullify FISA's private remedy and would be contrary to the plain language of Section 1806(f)." Id. at 1231 (emphasis added).

Concluding that "[t]he question becomes then whether Section 1806(f) preempts the state secrets privilege," the Oregon district court wrote, "I decline to reach this very difficult question at this time, which involves whether Congress preempted what the government asserts is a constitutionally-based privilege." Id. The Oregon district court certified its other rulings for immediate appeal. Defendants appealed and, during the pendency of the appeal, this case was reassigned by the Judicial Panel on Multidistrict Litigation ("MDL") to the undersigned.

The court of appeals granted interlocutory review and consolidated the appeal in this matter with the interlocutory appeal from an order by the undersigned concerning the state secrets privilege and related issues in Hepting v. AT & T Corp., 439 F Supp 2d 974 (N.D.Cal.2006). The cases were argued on the same day before the same panel, but the court of appeals later determined that "the claimed facts and circumstances of each case are distinct" and entered an order concurrently with the opinion in the instant matter stating that "the cases are no longer consolidated for any purpose." 507 F.3d at 1196 n. 3. The court of appeals subsequently issued an order withdrawing the submission of the Hepting appeal; that matter remains on appeal. Order, Hepting v. AT & T Corporation, Inc, No 06-17137 Doc # 128, United States Court of Appeals for the Ninth Circuit, filed November 16, 2007.

In its opinion in this case, the court of appeals determined that review of a district court's rulings on the state secrets privilege should be de novo, having previously only "intimated" as much. 507 F.3d at 1196. After considering the history of the state secrets privilege, the court of appeals considered three contentions by the government on appeal: (1) the very subject matter of the...