Al-Haramain Oregon Proposes U.S. Pay Damages for Illegal Surveillance to Another Charity

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The legal proceedings following a federal court's March 2010 ruling in Al-Haramain Islamic Foundation (AHIF) v. Obama that the government illegally wiretapped the charity and two of its lawyers from Feb. 19, 2004 to Sept. 9, 2004 have raised a novel issue: can the government pay a damage award to a listed terrorist organization? Lawyers for AHIF have proposed a novel solution, asking the court to turn over AHIF's share of the damages to one or more other charities.

The case is the only legal challenge to Bush-era illegal surveillance programs that survived in court, because AHIF and its lawyers were able to show they had been subject to surveillance by using public records and statements. In March 2010 Chief Judge Vaughn Walker of the Federal District Court for the Northern District of California ruled that the Bush administration had illegally wire tapped AHIF's phone conversations with its two American lawyers because it failed to obtain a warrant as required by the Foreign Intelligence Surveillance Act (FISA).

Under FISA Al-Haramain and the lawyers are entitled to damages of $100 for each day of illegal surveillance (a total of 204 days). On April 16, 2010 they filed a proposed judgment asking for $20,400 per plaintiff under this formula. They also asked for punitive damages of $183,600 per plaintiff, citing the abuse of executive power involved. This is where the unusual problem comes up, since AHIF has been placed on the Specially Designated Global Terrorist list (That designation is also subject to legal challenge.)  As a result, it is illegal for any U.S. person to have any transaction with it.
 
As explained by Michael Isikoff in Newsweek's Declassified column, "can the Justice Department pay money to a terrorist organization? And if it did, would it be committing the federal crime of providing material support to terrorists?"   

The Justice Department is researching the question (and solutions), but AHIF offered a way out in its May 7, 2010 memorandum in support of its claim for punitive damages. It said, "In light of the fact that the government is currently holding AHIF's assets in a blocked account, if the Court awards punitive damages to AHIF, plaintiffs will propose, upon the rendition of judgment, that in lieu of a transfer of those damages (and likewise compensatory damages) into AHIF's block account the Court shall order their cy pres distribution to one or more other charitable organizations whose missions are 'consistent with the nature of the underlying action.'" [p.16]
 
The cy pres doctrine is a well established equitable remedy used by courts when where (1) property is given in trust for a particular charitable purpose; (2) it is, or becomes, impossible, impracticable, or illegal to carry out such purpose; and (3) the [donor] manifested a more general intention to devote the property to charitable purposes.” See Am. Jur. § 149 (2009); Rest. (Second) Trusts § 399.