Zevallos v. Obama
10 F. Supp. 3d 111
D.D.C.2014Background
- Zevallos was designated a Significant Foreign Narcotics Trafficker under the Kingpin Act in 2004.
- Zevallos challenged OFAC’s designation, initiating litigation and engaging in repeated reconsideration requests and correspondence with OFAC through 2013.
- OFAC’s 2013 decision denied delisting, continuing Zevallos’s SFNT designation based on evidence of ongoing drug-trafficking connections, asset control, and related activity despite incarceration.
- The record includes DEA reports, Peruvian and Chilean court documents, and newspaper articles indicating Zevallos’s ongoing influence and asset control.
- Zevallos argues procedural due process, substantive due process, and takings challenges under the Fifth Amendment, and seeks either delisting or relief under the APA.
- The court grants OFAC's motion to dismiss or, in the alternative, for summary judgment, upholding the 2013 decision and dismissing other claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| APA standard review of OFAC decision | Zevallos contends OFAC’s 2013 denial was arbitrary and capricious. | OFAC's decision rests on substantial evidence and a rational connection to the facts. | OFAC decision not arbitrary or capricious; upheld. |
| Procedural due process pre- or post-designation | Zevallos argues lack of pre-deprivation notice/hearing and inadequate post-deprivation process. | Pre-deprivation notice not required; post-deprivation process and written submissions suffice. | No due process violation; post-deprivation process adequate; timing not prejudicial. |
| Takings jurisdiction | Blocking assets constitutes a taking; court should hear claim. | District courts lack jurisdiction for takings under IEEPA/Kingpin Act; Tucker Act limits relief; concurrent jurisdiction not established. | Takings claim dismissed for lack of subject matter jurisdiction. |
| Timeliness and mootness of challenges to pre-2004 designation | Challenge to initial designation may be timely or ongoing. | Focus on 2013 delisting decision; pre-2004 designation not before court here; mootness applies to delays. | Court does not reach merits on pre-2004 designation; mootness/preservation addressed through 2013 decision reasoning. |
Key Cases Cited
- Holy Land Found. for Relief & Dev. v. Ashcroft, 333 F.3d 156 (D.C. Cir. 2003) (extremely deferential review in national security/administrative context)
- Islamic Am. Relief Agency II, 477 F.3d 728 (D.C. Cir. 2007) (deference in foreign policy/administrative law)
- Zarmach Oil Servs., Inc. v. Dep’t of Treasury, 750 F. Supp. 2d 150 (D.D.C. 2010) (courts uphold agency rational basis with substantial evidence)
- Al Haramain Islamic Found., v. U.S. Dep’t of Treasury, 686 F.3d 965 (9th Cir. 2012) (procedural delay and evidence considerations under IEEPA/Kingpin context)
- Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663 (U.S. (1974)) (pre-deprivation due process analysis factors for asset blocking)