Cierco v. Lew
190 F. Supp. 3d 16
D.D.C.2016Background
- Plaintiffs Ramon and Higini Cicero (majority shareholders of Banca Privada d’Andorra, "BPA") sued Treasury/FinCEN after FinCEN issued a Notice of Finding and an NPRM in March 2015 labeling BPA a "financial institution of primary money laundering concern" and proposing § 311 special measures.
- The Notices led U.S. correspondent banks to cease dollar transactions with BPA; Andorran authorities (INAF, then AREB) seized BPA and initiated a process to transfer assets to a new state-owned entity, Vall Banc.
- Plaintiffs filed suit in October 2015 seeking rescission/vacatur of the Notices, injunctive relief preventing a final rule, disclosure of underlying documents, and related relief under the APA and the Due Process Clause.
- Before final agency action, FinCEN withdrew both the Notice of Finding and the NPRM in early 2016, stating BPA’s Andorran receivership and resolution process removed the basis for § 311 action.
- Defendants moved to dismiss as moot; the Court considered voluntary cessation and the capable-of-repetition-yet-evading-review exception and concluded the withdrawal rendered the case moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mootness after agency withdrawal (voluntary cessation) | Plaintiffs argued withdrawal insufficient because harm (BPA receivership, frozen equity) persists and a judicial declaration of illegality could aid recovery. | Defendants argued withdrawal of Notices removed the challenged action; there is no reasonable expectation of recurrence and interim events eradicated effects. | Court: Moot — agency withdrawal + intervening Andorran actions eliminate reasonable expectation of recurrence and preclude meaningful relief. |
| Availability of effective relief / redressability | Plaintiffs contended court could still provide meaningful relief (declaratory judgment) that might prompt Andorra to reverse BPA’s dissolution. | Defendants contended any vacatur or declaration would be purely advisory because the Notices already withdrawn and FinCEN lacks basis to promulgate a rule. | Court: No meaningful relief available; plaintiffs already obtained the primary relief sought (withdrawal), so declaratory relief would be advisory and cannot redress present injuries. |
| Capable-of-repetition-yet-evading-review exception | Plaintiffs suggested FinCEN’s practice could be repeated against other banks and evade review. | Defendants noted plaintiffs made no showing that they (or BPA) face a demonstrated probability of being subjected to the same action again. | Court: Exception not met — plaintiffs failed to show reasonable expectation that same action will recur against them. |
| Standing-related remedial scope (limits on judicially-ordered foreign relief) | Plaintiffs implied a judicial finding might influence Andorran authorities to restore BPA/assets. | Defendants and court stressed plaintiffs did not seek, and offer no legal basis for, an order compelling FinCEN to secure foreign sovereign action. | Court: Plaintiffs’ speculative third-party reliance on a declaration does not prevent mootness; the Court will not invent relief beyond the complaint. |
Key Cases Cited
- Ratzlaf v. United States, 510 U.S. 135 (1994) (background on congressional intent behind anti-money-laundering statutes)
- County of Los Angeles v. Davis, 440 U.S. 625 (1979) (voluntary cessation mootness standard)
- Gulf Oil Corp. v. Brock, 778 F.2d 834 (D.C. Cir. 1985) (agency rescission can moot challenge to regulation)
- Church of Scientology of Cal. v. United States, 506 U.S. 9 (1992) (no relief where court cannot grant any effectual remedy)
- Larsen v. U.S. Navy, 525 F.3d 1 (D.C. Cir. 2008) (mootness where plaintiff does not allege likelihood of recurrence)
- Honeywell Int’l, Inc. v. NRC, 628 F.3d 568 (D.C. Cir. 2010) (party asserting mootness bears initial burden; opponent must show exceptions)
- City of Houston v. Dep’t of Hous. & Urban Dev., 24 F.3d 1421 (D.C. Cir. 1994) (declaratory relief moot if it would be merely advisory regarding isolated agency action)
- Murphy v. Hunt, 455 U.S. 478 (1982) (requirement that recurrence be a demonstrated probability for repetition exception)
- FBME Bank Ltd. v. Lew, 125 F. Supp. 3d 109 (D.D.C. 2015) (contrasting example where final § 311 rule remained subject to review)