On June 1, 2012, the U.S. Court of Appeals for the District of Columbia ruled that the Obama administration must make a decision within four months whether or not to remove the People’s Mujahedin Organization of Iran (PMOI) aka Mujahedeen-e Khalq (MEK) from the State Department’s list of Foreign Terrorist Organizations (FTO). In a statement released after the decision, State said its position on the MEK has been under review since a court mandate in 2010, but that it “intends to comply” with the new court’s order. Several prominent politicians and former government officials have been financially compensated to speak out against the MEK remaining on the list, triggering a Treasury Department investigation into whether such payments violate sanctions that prohibit financial dealings with terrorist groups.

In its ruling, the three-judge panel said that it would not make a decision about the group’s status, but called on the administration to act before October. “In light of the national security and foreign policy concerns underlying the designation, we decline, at this time, to revoke the Foreign Terrorist Organization’s designation,” the court ruled. “Instead, we order the Secretary to either deny or grant PMOI’s petition not later than four months from the date this opinion issues.” If Clinton fails to take action within that period, “the petition for a writ of mandamus setting aside the FTO [foreign terrorist organization] designation will be granted,” the court added.
The court’s opinion reviewed the process available to  a FTO that wants to challenge being placed on the FTO list. It can petition the State Department and must provide evidence of changed circumstances that would warrant revocation of the designation to the FTO list. Once such a petition is filed, the Secretary of State has 180 days to act. The listing must be revoked if:
  1. circumstances have changed in such a manner as to warrant revocation, or
  2. national security considerations warrant revocation.
(8 U.S.C. 1189(c)(3) When a petition is denied the FTO has thirty days to appeal to the Court of Appeals for the District of Columbia. On July 16, 2010 the Court granted PMOI/MEK’s petition for review because the State Department “failed to accord the PMOI the due process protections outlined in our previous decisions.” These included the requirement that “PMOI be notified of the unclassified material on which the Secretary proposes to rely and [be given] an opportunity to respond to that material before its re-designation.”
The Court’s order instructs the Secretary of State to allow PMOI/MEK to review an unclassified portion of the record on which State is based its 2009 decision to deny revocation, and to indicate which items she believes are credible.
The Treasury Department has an ongoing investigation into payments made to PMOI/MEK supporters.  U.S. law prohibits giving to or receiving funds from a listed terrorist group. It is also illegal to advocate on behalf of a designated terrorist group if that advocacy is coordinated with them. Reports indicate that the former high ranking government officials received about $20-30,000 per speech and a variety of perks, including first-class airfare to European cities.