United States v. Dhafir
461 F.3d 211 (2006)
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Rule of Law:
Congress may delegate authority to the President to define criminal conduct under the International Emergency Economic Powers Act (IEEPA), so long as it lays down an 'intelligible principle' to guide the President's discretion. This delegation is afforded broad deference in the realm of foreign affairs and national security.
Facts:
- The International Emergency Economic Powers Act (IEEPA) was enacted in 1977, granting the President authority to regulate international economic transactions during a national emergency.
- In August 1990, following Iraq's invasion of Kuwait, President George H.W. Bush declared a national emergency and issued Executive Orders under IEEPA prohibiting most financial transactions with Iraq.
- The U.S. Treasury Department's Office of Foreign Assets Control (OFAC) subsequently promulgated regulations implementing the Executive Orders, making it a crime for any U.S. person to transfer funds to any person in Iraq.
- In November 1990, Congress passed the 'Iraqi Sanctions Act,' explicitly declaring its support for the President's actions and mandating the continuation of the economic sanctions against Iraq.
- On three occasions between October 1999 and February 2000, Osameh Al Wahaidy transferred a total of $100,000 through Jordan to persons located in Iraq.
- Al Wahaidy stated he believed the funds were intended for humanitarian aid, but they were actually used by Iraqi 'agents' for undisclosed purposes.
Procedural Posture:
- Osameh Al Wahaidy was charged by Information in the United States District Court for the Northern District of New York with willfully violating Executive Orders issued pursuant to the IEEPA.
- Al Wahaidy filed a motion to dismiss the charges, arguing that the IEEPA represented an unconstitutional delegation of legislative authority to the executive branch.
- While his motion was pending, Al Wahaidy pled guilty to the charges but explicitly preserved his right to appeal the constitutional question.
- The district court denied Al Wahaidy's motion to dismiss, upholding the constitutionality of the IEEPA.
- Al Wahaidy was sentenced and subsequently appealed the district court's denial of his motion to the U.S. Court of Appeals for the Second Circuit.
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Issue:
Does the International Emergency Economic Powers Act (IEEPA), which authorizes the President to regulate and prohibit financial transactions with foreign nationals during a declared national emergency and makes violations of such regulations a criminal offense, constitute an unconstitutional delegation of Congress's legislative power to define crimes?
Opinions:
Majority - Jacobs, Circuit Judge
No, the International Emergency Economic Powers Act (IEEPA) does not constitute an unconstitutional delegation of Congress's legislative authority. A congressional delegation of power is constitutional so long as Congress lays down an 'intelligible principle' to guide the authorized body, a standard that is applied with even broader deference in the sphere of foreign affairs. The IEEPA provides sufficient constraints on the President's authority by requiring a declared national emergency to address an 'unusual and extraordinary threat,' defining the specific powers that may be exercised, and maintaining congressional oversight through consultation, reporting, and the power to terminate the emergency. Even if a heightened standard were required for delegations involving criminal sanctions, as suggested in Touby v. United States, the IEEPA's meaningful constraints on the President's discretion would satisfy it. Furthermore, the delegation is bolstered by the President's inherent constitutional authority in foreign affairs and by Congress's subsequent express endorsement of the specific sanctions against Iraq.
Analysis:
This decision reaffirms the broad latitude Congress has in delegating authority to the President, particularly in matters of foreign policy and national security. By upholding the IEEPA's criminal penalty provisions, the court solidifies the executive's power to use economic sanctions as a key foreign policy tool, allowing for swift and flexible responses to international crises without requiring new, specific legislation for each event. The ruling confirms that the 'intelligible principle' test remains a highly deferential standard, even when the delegated authority extends to defining conduct that can result in criminal prosecution. This precedent reinforces the executive's dominant role in foreign affairs and provides a strong legal foundation for future sanctions regimes enacted via executive order.
