Stansell v. Revolutionary Armed Forces Colombia
| Decision Date | 20 June 2019 |
| Docket Number | Case No: 8:09-cv-2308-T-36AAS |
| Parties | KEITH STANSELL, MARC GONSALVES, THOMAS HOWES, JUDITH G. JANIS, CHRISTOPHER T. JANIS, MICHAEL I. JANIS and JONATHAN N. JANIS, Plaintiffs, v. REVOLUTIONARY ARMED FORCES OF COLOMBIA (FARC), et al., Defendants. |
| Court | U.S. District Court — Middle District of Florida |
This cause comes before the Court upon the Report and Recommendation filed by Magistrate Judge Amanda Arnold Sansone on March 25, 2019, (Doc. 1194). In the Report and Recommendation ("R&R"), Magistrate Judge Sansone recommends that the Plaintiffs' Motion for Turnover Judgment under the Terrorism Act (Doc. 1185) be granted and the Court enter final judgment in garnishment against Ocean Bank for $928,756.29, subject to certain conditions.
All parties were furnished copies of the R&R and were afforded the opportunity to file objections pursuant to 28 U.S.C. § 636(b)(1). Plaintiffs filed a limited objection to the R&R (the "Objection") regarding whether the Terrorism Risk Insurance Act, codified at 28 U.S.C. § 1610 (the "TRIA"), requires them to obtain a license for a TRIA Turnover Judgment under these facts. Doc. 1195. The United States filed a Statement of Interest (the "Statement") which indicates that Plaintiffs need no Department of the Treasury Office of Foreign Assets Control ("OFAC") license to obtain turnover judgment under the Anti-Terrorism Act, 18 U.S.C. § 2333; and OFAC would not provide an ex post authorization to turnover the funds as reasoned in the R&R. Doc. 1197. The Court having reviewed the R&R, the Objection, and the Statement, and otherwise being advised of the premises will sustain the objection, modify-in-part the R&R, and grant the Motion for Turnover Judgment.
Plaintiffs obtained a judgment for $318,030,000 in compensatory damages against the Revolutionary Armed Forces of Colombia ("FARC") and many individuals due to a 2003 international act of terrorism. Docs. 1, 233. Plaintiffs began collection on their judgment and moved for writs of garnishment against Aero Continente's assets at Ocean Bank. Doc. 314. The Court entered an order that Aero Continente is an agency or instrumentality of the FARC because it is involved in "the cultivation, manufacture, processing, purchase, sale, trafficking, security, storage, shipment or transportation, [or] distribution of FARC coca paste or cocaine." Doc. 322 at ¶ 15. The Court then issued a writ of garnishment against Aero Continente's assets held by Ocean Bank. Id. at ¶ 28(i). OFAC also designated Aero Continente as a Specially Designated Narcotics Trafficker ("SDNT").
Thereafter, the Eleventh Circuit held that assets frozen under the Foreign Narcotics Kingpin Designation Act, 21 U.S.C. §§ 1901-08 (the "Kingpin Act") are not "blocked assets" as defined by Section 201 of the TRIA. Therefore, it held that those funds were not available for the enforcement of judgments under the Anti-Terrorism Act. Stansell v. Revolutionary Armed Forces of Colom., 704 F. 3d 910 (11th Cir. 2013) ("Stansell I"). This Court stayed the execution on the writs of garnishments, including Aero Continente's assets at Ocean Bank, as a result. Docs. 562, 592.
On October 3, 2018, Congress enacted the Anti-Terrorism Clarification Act of 2018, Pub. Law 115-25 (the "Clarification Act") which expanded the TRIA's definition of "blocked assets"to include assets blocked by the Kingpin Act. 18 U.S.C. § 2333(e). Plaintiff moved for a renewed writ of garnishment against Aero Continente's assets held at Ocean Bank, and to lift the Court's stay on the issuance and enforcement of the Kingpin Act writs. Doc. 1161. The Court granted the motion. Doc. 1166.
In their Motion for Turnover Judgment against Ocean Bank under the TRIA, (the "Motion"), Doc. 1185, Plaintiffs argue that Aero Continente is a SDNT under the Kingpin Act, (§ 1904(b)), and they are thus entitled to receive its assets held at Ocean Bank. Id. This Court referred the Motion to Magistrate Judge Sansone for a report and recommendation. Doc. 1186. Magistrate Judge Sansone entered an R&R recommending that the Court grant the Motion under certain conditions.
Plaintiffs object to the R&R based on its finding that they need a license from OFAC to execute under Section 201 of the TRIA. They recognize that that conclusion does not adversely affect the R&R's ultimate recommendation with which they agree, but they insist that the conclusion regarding the OFAC license is erroneous. The United States concurs.
When a party makes a timely and specific objection to a magistrate judge's report and recommendation, the district judge "shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made." 28 U.S.C. § 636(b)(1)(C); Jeffrey S. v. State Bd. of Educ. of State of Ga., 896 F.2d 507, 512 (11th Cir. 1990). With regard to those portions of the report and recommendation not objected to, the district judge applies a clearly erroneous standard of review. See Gropp v. United Airlines, Inc., 817 F. Supp. 1558, 1562 (M.D. Fla. 1993). The district judge may accept, reject, or modify in whole or in part, the report and recommendation of the magistrate judge. Fed. R. Civ. P. 72. The district judge mayalso receive further evidence or recommit the matter to the magistrate judge with further instructions. Id.
The R&R states:
[T]he request for a determination that no OFAC license is required to execute blocked assets under the Kingpin Act appears inappropriate. Judgment creditors seeking to execute property under the Kingpin Act must obtain a license from OFAC. [Stansell v. Revolutionary Armed Forces of Colom., 771 F.3d 713, 734 (11th Cir. 2014)] Stansell II, 771 F.3d at 734 (citations omitted); see also Doe v. JPMorgan Chase Bank, N.A., 899 F.3d 152, 158 (2d Cir. 2018) (footnote and citations omitted) ( applicable OFAC regulations "unambiguously prohibit unlicensed transfers of blocked assets").
Plaintiffs object to this finding. They also object to the statement in the R&R that the 2006 letter in Weininger v. Castro from the Southern District of New York United States Attorney's Office "predates Stansell II and the newly amended [TRIA]."2 Doc. 1194 at 7-8. Plaintiffs maintain that the Clarification Act did not amend the TRIA, it only amended the Anti-Terrorism Act, which brought assets blocked under the Kingpin Act within the scope of the TRIA's definition of "blocked asset." Doc. 1195 at 2.
They point out that the United States appeared in this action and set forth that under the "TRIA, terrorism victims may execute against certain blocked assets, without getting authorization from OFAC, if the assets are judicially determined to be within [the] TRIA's scope." Id. (citing Stansell v. FARC/Mercurio, 11th Cir. Case Nos: 11-11125 & 11-11690, United States Amicus Brief at 10). Thus, they argue that once the Court determines that the Kingpin Act's blocked assets are subject to execution, as the Court has here, no OFAC license is required. Plaintiffs also contendthat the Eleventh Circuit did not hold that terrorism victim judgment creditors must obtain an OFAC license to execute on blocked assets subject to the TRIA. Doc. 1195 at 3 (citing Stansell II, 771 F.3d at 734).
The United States objects to the Magistrate Judge's refusal to recommend that the Court's order granting Plaintiffs' Motion contain an instruction that "no OFAC license is required to turn over the garnished funds to Plaintiffs." Doc. 1197 at 6 (citing Doc. 1194 at 7-8). Instead, the Magistrate Judge recommended that the Court conclude that a license is required under these facts; and that OFAC's regulations permit Plaintiffs to obtain the required license subsequent to execution of the assets. Doc. 1194 at 8. The United States contends that the R&R's reasoning is erroneous.
a. The TRIA and the Clarification Act of 2018
The TRIA governs post-judgment attachment proceedings in certain cases arising out of terrorist acts under the civil remedies provision of the Anti-Terrorism Act, 18 U.S.C. § 2333. These acts include judgments such as the one held by Plaintiffs.
Congress amended Section 201 of the TRIA to provide that:
Notwithstanding any other provision of law, and except as provided in subsection (b) [of this note], in every case in which a person has obtained a judgment against a terrorist party on a claim based upon an act of terrorism, or for which a terrorist party is not immune under section 1605A or 1605(a)(7) () of Title 28, United States Code, the blocked assets of that terrorist party (including the blocked assets of any agency or instrumentality of that terrorist party) shall be subject to execution or attachment in aid of execution in order to satisfy such judgment to the extent of any compensatory damages for which such terrorist party has been adjudged liable.
Pub. L. No. 107-297, 116 Stat. 2322 (codified at 28 U.S.C. § 1610 note).
The TRIA defines the term "blocked assets" at Section 201(d)(2) to include:
[A]ny asset seized or frozen by the United States under section 5(b) of the Trading With the Enemy Act [("TWEA")] [now 50 U.S.C. § 4305(b)] or under sections 202 and 203 of the InternationalEmergency Economic Powers Act [("IEEPA")] (50 U.S.C. [§§] 1701; 1702) [excluding certain assets subject to U.S. Government licenses and other diplomatic property].
28 U.S.C. § 1610 note.
Thus, Section 201(a) of the TRIA allows a plaintiff to execute a judgment on blocked assets of a terrorist party, or its agency or instrumentality, to satisfy a judgment against the terrorist party, where:
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