Keith Stansell v. SAI Advisors Inc.

Case: 18-13696 Date Filed: 05/10/2019 Page: 1 of 12
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 18-13696
Non-Argument Calendar
________________________
D.C. Docket No. 8:09-cv-02308-RAL-MAP
KEITH STANSELL, et al.,
Plaintiff - Appellee,
versus
REVOLUTIONARY ARMED FORCES OF COLUMBIA (FARC), et al.,
Defendants,
SAI ADVISORS INC.,
NOOR PLANTATION INVESTMENTS LLC,
11420 CORP.,
Claimants - Appellants.
________________________
Appeal from the United States District Court
for the Middle District of Florida
________________________
(May 10, 2019)
Case: 18-13696 Date Filed: 05/10/2019 Page: 2 of 12
Before TJOFLAT, WILSON, and JORDAN, Circuit Judges.
PER CURIAM:
In 2010, Keith Stansell, Marc Gonsalves, Thomas Howes, Judith Janis—as
personal representative of Thomas Janis’ estate—and Thomas Janis’ surviving
children (collectively, Appellees) obtained a $318 million default judgment against
the Revolutionary Armed Forces of Colombia (FARC) under the Antiterrorism
Act, 28 U.S.C. § 2333. Since then, Appellees have attempted to satisfy that
judgment by seizing “the blocked assets of any [FARC] agency or instrumentality”
pursuant to § 201 of the Terrorism Risk Insurance Act of 2002 (TRIA).1
On June 28, 2018, the district court issued writs of execution against twelve
properties owned by three Florida corporate entities—SAI Advisors, Inc., Noor
Plantation Investments LLC, and 11420 Corp. (collectively, Claimants)—after
finding that the entities constituted instrumentalities of FARC under TRIA.
Claimants filed a motion to set aside the final judgment pursuant to Federal Rule of
Civil Procedure 60(b), arguing that they are entitled to a hearing in order to prove
1
Section 201(a) of TRIA reads:
Notwithstanding any other provision of law, and except as
provided in subsection (b), in every case in which a person has
obtained a judgment against a terrorist party on a claim based upon
an act of terrorism, or for which a terrorist party is not immune
under section 1506(a)(7) of title 28, United States Code, the
blocked assets of that terrorist party (including the blocked assets
of any agency or instrumentality of that terrorist party) shall be
subject to execution or attachment in aid of execution in order to
satisfy such judgment to the extent of any compensatory damages
for which such terrorist party has been adjudged liable.
2
Case: 18-13696 Date Filed: 05/10/2019 Page: 3 of 12
that they are not “agencies or instrumentalities” of FARC. The district court
denied their motion and set a date for the sale of the twelve properties. Claimants
sought a stay of the public sale, which was eventually denied. 2 The properties
were sold on October 26, 2018.
Claimants appeal the district court’s order denying their Rule 60(b) motion.
Specifically, Claimants ask us to “remand with directions to provide Claimants a
reasonable opportunity to be heard before execution on their properties.” Because
the properties have been sold, this case is moot. We therefore dismiss it for lack of
jurisdiction.
I. Factual and Procedural Background
On February 13, 2003, Stansell, Gonsalves, Howes, and Thomas Janis were
flying over Colombia while conducting counter-narcotics reconnaissance.
Members of FARC shot their plane down and captured the group. FARC members
executed Janis immediately, and held the others hostage for five years.
After they were rescued, Stansell, Gonsalves, and Howes—along with Janis’
wife, Judith, as personal representative of his estate, and Janis’ surviving
children—filed a complaint against FARC in the United States District Court for
the Middle District of Florida under the Antiterrorism Act, 28 U.S.C. § 2333.
2
The district court denied the motion for a stay. On appeal, we issued an order temporarily
granting the stay and subsequently lifted the temporary stay. Claimants filed a motion for
reconsideration, which we denied.
3
Case: 18-13696 Date Filed: 05/10/2019 Page: 4 of 12
FARC representatives failed to appear. Consequently, on June 15, 2010, the
district court entered a $313,030,000 default judgment in favor of Plaintiffs.
“Because of the difficulty inherent in the direct execution of a judgment against a
terrorist organization, Plaintiffs sought to satisfy their award by seizing the assets
of ‘agenc[ies] or instrumentalit[ies]’ of FARC pursuant to § 201(a) of TRIA.”
Stansell et al. v. Revolutionary Armed Forces of Colombia (FARC), et al., 771 F.3d
713, 722 (11th Cir. 2014) (citations omitted). Under TRIA, judgment creditors
may satisfy an Antiterrorism Act judgment if (1) the Department of Treasury’s
Office of Foreign Assets Control (OFAC) blocks properties under Executive Order
13692,3 the Trading with the Enemy Act, or the International Emergency
3
On March 8, 2015, President Obama issued Executive Order entitled “Blocking Property and
Suspending Entry of Certain Persons Contributing to the Situation in Venezuela,” which
declared a national emergency with respect to the “exacerbating presence of significant public
corruption” in Venezuela and blocked “all property and interests in property that are in the
United States” by “any person” determined by the Treasury:
(A) to be responsible for or complicit in, or responsible for
ordering, controlling, or otherwise directing, or to have
participated in, directly or indirectly, any of the following in or in
relation to Venezuela:
....
(4) public corruption by senior officials within the
Government of Venezuela;
....
(C) to be a current or former official of the Government of
Venezuela;
(D) to have materially assisted, sponsored, or provided financial,
material, or technological support for, or goods or services to or in
support of:
(1) a person whose property and interests in property are
blocked pursuant to this order; or
(2) an activity described in subsection (a)(ii)(A) of this
section; or
4
Case: 18-13696 Date Filed: 05/10/2019 Page: 5 of 12
Economic Powers Act, and (2) the judgment creditors establish that the blocked
properties are owned by the terrorist organization they received a judgment
against, or agents or instrumentalities of that terrorist organization. See § 201(a) of
TRIA, Pub. L. No. 107-297, 116 Stat. 2322 (codified at 28 U.S.C. § 1610 note);
see also Stansell, 771 F.3d at 726. “If the party wishes to execute against the
assets of a terrorist party’s agency or instrumentality, the party must further
establish that the purported agency or instrumentality is actually an agency or
instrumentality.” Stansell, 711 F.3d at 723.
On May 18, 2018, OFAC blocked the twelve properties at issue pursuant to
Executive Order 13692. Then, on June 10, 2018, Appellees filed a motion for
TRIA executions on the twelve blocked properties. They argued that each of the
three Claimants were agents or instrumentalities of FARC within the meaning of
§ 201(a) of TRIA. In support of Appellees’ argument that Claimants constitute
agents or instrumentalities of FARC, they filed 44 exhibits and two expert
affidavits.
(E) to be owned or controlled by, or to have acted or purported to
act for or on behalf of, directly or indirectly, any person whose
property and interests in property are blocked pursuant to this
order.
Exec. Order No. 13692, 80 Fed. Reg. 12747 (Mar. 8, 2015).
5
Case: 18-13696 Date Filed: 05/10/2019 Page: 6 of 12
On June 28, 2018, the district court entered an order designating Claimants
as agents or instrumentalities of FARC and concluding that Appellees were entitled
to writs of execution on the twelve properties. According to the district court,
Plaintiffs, through their extensive submissions, have
adequately established that (1) they have obtained a
judgment against a terrorist party (the FARC) that is
based on a claim of terrorism, (2) the assets which
Plaintiff seek to execute on are blocked assets as that
term is defined in the Terrorism Risk Insurance Act, (3)
the total amount of the execution does not exceed the
assets of the terrorist’s agency or instrumentality, and (4)
the owners of the assets which Plaintiffs seek to execute
on is actually an agency or instrumentality of a terrorist
party (the FARC).
The next day, the clerk of the court issued the writs of execution pursuant to the
district court’s order. On July 6, Appellees perfected their judgment lien in
compliance with Florida Statute § 55.10.
On July 17, the U.S. Marshal levied on the twelve parcels, posting each writ
of execution in an open and conspicuous manner on each property. The notices
indicated that the public sale would occur on September 7, 2018. Then, on July 27,
the U.S. Marshal provided additional certified mail notice to the Claimants’
registered corporate addresses and their attorney of record in compliance with
Florida Statute § 56.21. Claimants’ attorney at the time, Mr. Videl-Cordero,
received the documents and actual notice of the execution proceedings on August
2.
6
Case: 18-13696 Date Filed: 05/10/2019 Page: 7 of 12
On August 30, the Claimants filed a Rule 60(b) motion, urging the district
court to either vacate or stay the writs of execution issued on June 28 and afford
them “the opportunity to present evidence refuting the agency or instrumentality
designation.” The district court denied Claimants’ Rule 60(b) motion, noting how
Claimants failed to establish that they were not “agents or instrumentalities” of
FARC. Order Den. Mot. to Vacate at 2 (“[A] ‘bald assertion’ of counsel without
any supporting facts such as affidavits from property owners refuting the agency or
instrumentality designation or legal argument that Claimants are improperly
designated by the OFAC, is insufficient to grant relief.” (citing Stansell, 771 F.3d
at 738, 740–41)). Furthermore, the court noted that
Claimants are afforded an opportunity to be heard now,
and they have presented no basis to refute, either in fact
or law, the agency or instrumentality designation. This
Court, after due consideration of the Claimant’s
argument and submissions, or lack thereof, concludes
that the agency or instrumentality designation stands as
true based on the total absence of any valid or arguable
flaw.
Id. at 3.
That day, Claimants filed a Notice of Appeal. Then, on September 4,
Claimants motioned the district court to stay the September 7 public sale. The
district court denied the request. Claimants then filed an emergency stay motion
with this Court. On September 6, we temporarily granted the stay. Two weeks
7
Case: 18-13696 Date Filed: 05/10/2019 Page: 8 of 12
later, we lifted the temporary stay. Claimants then filed a motion for
reconsideration, which we denied.
The appellate stay having been lifted, the U.S. Marshal scheduled the public
sale for October 26, 2018. The Marshal again gave the requisite statutory certified
mail notice before publishing the new date four times. On October 26, the Marshal
conducted the public sale. Appellees submitted the winning bids on all twelve
parcels, and therefore are the legal owners.
All that is left to review is Claimants’ initial appeal of the district court order
denying Claimants’ Rule 60(b) motion to vacate.
II. Jurisdiction
“Article III of the Constitution limits jurisdiction of the federal courts to the
consideration of certain ‘Cases’ and ‘Controversies.’” Adler v. Duval Cty. Sch.
Bd., 112 F.3d 1475, 1477 (11th Cir. 1997) (citing U.S. Const. art. III § 2). “A case
becomes moot—and therefore no longer a ‘Case’ or ‘Controversy’ for purposes of
Article III—when the issues presented are no longer ‘live’ or the parties lack a
legally cognizable interest in the outcome.” Already, LLC v. Nike, Inc., 568 U.S.
85, 91 (2013) (quotation and citation omitted). So, “[w]hen events subsequent to
the commencement of a lawsuit create a situation in which the court can no longer
give meaningful relief, the case is moot and must be dismissed.” Fla. Ass’n of
8
Case: 18-13696 Date Filed: 05/10/2019 Page: 9 of 12
Rehab. Facilities, Inc. v. Fla. Dep’t of Health & Rehab. Servs., 225 F.3d 1206,
1216 (11th Cir. 2000).
Here, we are unable to grant meaningful relief. Claimants ask us to remand
with instructions for the district court to hold a hearing aimed at determining
whether they are agents or instrumentalities of FARC. The agents or
instrumentalities designation is important because it is one of two requirements a
plaintiff must satisfy in order to prove that certain properties are subject to
execution under TRIA. The district court determined that both requirements were
met here: (1) OFAC “blocked” the twelve properties; and (2) Claimants were
agents or instrumentalities of FARC. Accordingly, the court issued a writ of
execution on the Claimants’ twelve properties and those properties were
subsequently sold at a public sale. Given the sale, it would be fruitless for us to
instruct the district court to hold a hearing to reconsider the agents or
instrumentalities designation. That is, a determination that Claimants are not
agents or instrumentalities of a terrorist organization would not rescind the sale.
Consequently, no meaningful relief can be granted. This appeal is moot.
Claimants argue that this case falls into the capable of repetition, yet evading
review exception to mootness. That exception “applies where (1) the challenged
action is in its duration too short to be fully litigated prior to cessation or
expiration, and (2) there is a reasonable expectation that the same complaining
9
Case: 18-13696 Date Filed: 05/10/2019 Page: 10 of 12
party will be subject to the same action again.” Arcia v. Fla. Sec’y of State, 772
F.3d 1335, 1343 (11th Cir. 2014). Claimants argue that both prongs are satisfied.
First, Claimants argue the challenged action—the sale of Claimants’ properties
without due process—was too short to be fully litigated prior to cessation because,
following this Court’s lifting of the stay, the public sale went forth. Second,
Claimants argue that they have a reasonable expectation that they will be subject to
similar execution efforts in the future because Appellees will continue to execute
on their judgment.
We are not persuaded that Claimants satisfy either prong. First, Claimants
cannot prove that the action is so short in duration as to evade review. In fact,
review did occur—we considered Claimants’ motion for a stay of the public sale,
and even temporarily granted it before eventually lifting the stay. As many of our
sister circuits have held, “[w]here prompt application for a stay pending appeal can
preserve an issue for appeal, the issue is not one that will evade review.”
Headwaters, Inc. v. Bureau of Land Mgmt., Medford Dist., 893 F.2d 1012, 1016
(9th Cir. 1989) (quoting Am. Horse. Prot. Ass’n, Inc. v. Watt, 679 F.2d 150, 151
(9th Cir. 1982) (per curiam)); Neighborhood Transp. Network, Inc. v. Pena, 42
F.3d 1169, 1173 (8th Cir. 1994); New York City Emps. Ret. Sys. v. Dole Food Co.,
Inc., 969 F.2d 1430, 1435 (2d Cir. 1992); cf. In re Matos, 790 F.2d 864, 865 (11th
Cir. 1986) (“It is settled law in this circuit that when the debtor fails to obtain a
10
Case: 18-13696 Date Filed: 05/10/2019 Page: 11 of 12
stay pending appeal of the bankruptcy court’s or the district court’s order setting
aside an automatic stay and allowing a creditor to foreclose on a property, the
subsequent foreclosure and sale of the property renders moot any appeal.”).
Moreover, we agree with the Ninth Circuit that it does not matter that the
Claimants’ stay was ultimately denied. See Headwaters, Inc., 893 F.3d at 1016
n.8. Because we in fact did review Claimants’ motion to stay, this is not a claim
that “evades review.”
Likewise, Claimants have not demonstrated that there is a “reasonable
expectation” of repetition. As mentioned, a plaintiff seeking a writ of execution
under TRIA must prove (1) that those properties are “blocked” and (2) that the
properties are owned by a terrorist organization or agents or instrumentalities of
that terrorist group. Here, Claimants have put forth no evidence suggesting that
OFAC has “blocked” any more of Claimants’ properties. Moreover, in a
subsequent suit, Appellees would have to independently establish that Claimants
are agents or instrumentalities of a terrorist organization. And Claimants could
refute that designation. 4 Ultimately, the capable of repetition, yet evading review
exception to mootness is inapplicable here.
4
We do not comment on whether issue preclusion may bar Claimants from disputing an agency
or instrumentality designation made in subsequent actions.
11
Case: 18-13696 Date Filed: 05/10/2019 Page: 12 of 12
Because this appeal is moot and no exception applies, we must dismiss it for
lack of jurisdiction. 5
DISMISSED.
5
Claimants frame the issue on appeal as: “Whether Claimants-Appellants are entitled to a post-
deprivation due process hearing prior to execution on their properties.” We do not want our
dismissal for lack of jurisdiction to be perceived as resolving that merits question in the negative.
That is, in dismissing for lack of jurisdiction, we are not holding that future claimants are not
entitled to a post-deprivation due process hearing prior to execution on their properties.
12