Hekmati v. United States

Case: 21-2086 Document: 33 Page: 1 Filed: 10/13/2022
United States Court of Appeals
for the Federal Circuit
______________________
AMIR HEKMATI,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
______________________
2021-2086
______________________
Appeal from the United States Court of Federal Claims
in No. 1:19-cv-01766-RAH, Judge Richard A. Hertling.
______________________
Decided: October 13, 2022
______________________
EMILY GRIM, Gilbert LLP, Washington, DC, argued for
plaintiff-appellant. Also represented by SCOTT DAVID
GILBERT, BRANDON LEVEY, MARK A. PACKMAN.
SHARI A. ROSE, Commercial Litigation Branch, Civil Di-
vision, United States Department of Justice, Washington,
DC, argued for defendant-appellee. Also represented by
BRIAN M. BOYNTON, MARTIN F. HOCKEY, JR, PATRICIA M.
MCCARTHY, MEEN GEU OH.
______________________
Before LOURIE, BRYSON, and CUNNINGHAM, Circuit
Judges.
Case: 21-2086 Document: 33 Page: 2 Filed: 10/13/2022
2 HEKMATI v. US
CUNNINGHAM, Circuit Judge.
The special master of the United States Victims of
State Sponsored Terrorism Fund awarded money to Amir
Hekmati. Later, the special master reconsidered his deci-
sion and rejected Mr. Hekmati’s application to the Fund.
Mr. Hekmati now appeals the United States Court of Fed-
eral Claims’ decision that it lacks subject-matter jurisdic-
tion over Mr. Hekmati’s claim seeking payment of the
money that the special master initially awarded him. See
Hekmati v. United States, 153 Fed. Cl. 800 (2021). We con-
clude that 34 U.S.C. § 20144 precludes judicial review of
the special master’s reconsideration decision. Accordingly,
we affirm.
I. BACKGROUND
Mr. Hekmati is a United States Marine Corps veteran
who completed two tours of service in Iraq between 2001
and 2005. J.A. 86. He also worked as a military contractor
between 2005 and 2011. Id. The last of Mr. Hekmati’s jobs
as a contractor led to him being stationed in Afghanistan.
J.A. 87–88. On his way back to the United States, Mr. Hek-
mati made a trip to Iran, where, he claims, he intended to
visit family. J.A. 90, 96.
Then, on August 29, 2011, the Iranian government ar-
rested Mr. Hekmati. J.A. 90. For the next four years, the
Iranian government detained Mr. Hekmati and tortured
him. J.A. 90–92. Finally, in 2016, the United States se-
cured Mr. Hekmati’s release in a prisoner exchange. J.A.
94.
After returning to the United States, Mr. Hekmati
sued the Iranian government in the U.S. District Court for
the District of Columbia, alleging that his detention and
treatment constituted hostage-taking and torture under
the Foreign Sovereign Immunities Act. J.A. 95. The dis-
trict court entered a default judgment in Mr. Hekmati’s fa-
vor the following year and awarded him about $63.5
Case: 21-2086 Document: 33 Page: 3 Filed: 10/13/2022
HEKMATI v. US 3
million. J.A. 96. Mr. Hekmati then applied for compensa-
tion from the Fund. J.A. 99. Established by the Justice for
United States Victims of State Sponsored Terrorism Act
(the “Act”), 34 U.S.C. § 20144, the Fund provides money to
citizens to whom a United States district court has
awarded monetary damages against a foreign state that
was a designated state sponsor of terrorism. Id.§ 20144(c)(2)(A)(i). On December 13, 2018, the special
master of the Fund, Kenneth Feinberg, informed Mr. Hek-
mati that he had “reviewed and approved” Mr. Hekmati’s
claim. J.A. 53.
Months passed. Mr. Hekmati received no money. J.A.
173. In October 2019, the Fund’s interim special master,
Deborah Connor, sent Mr. Hekmati a letter stating that the
Department of Justice intended to seek reconsideration of
the Fund’s approval of his claim. J.A. 175. Mr. Hekmati
promptly sued the United States in the Court of Federal
Claims to secure payment of the money the special master
had awarded him. J.A. 31, 47–48.
Nevertheless, on January 15, 2020, Mr. Feinberg—
whom the Department of Justice retained again to review
Mr. Hekmati’s case, J.A. 175—sent Mr. Hekmati a letter
stating that he had “determined that Mr. Hekmati [was]
not eligible for compensation from the USVSST Fund,” J.A.
177. Specifically, Mr. Feinberg concluded that “Mr. Hek-
mati’s application and accompanying documents contained
material omissions and false statements,” contrary to Fund
procedures. Id. Mr. Hekmati had claimed that “the pri-
mary purpose of his trip to Iran was to visit family for per-
sonal reasons.” Id. But Mr. Feinberg determined that the
primary purpose of Mr. Hekmati’s trip was different—it
was “to sell classified U.S. national security information to
the government in Iran.” Id.
Mr. Hekmati proceeded to request a hearing before Mr.
Feinberg under 34 U.S.C. § 20144(b)(4). J.A. 198. After
the hearing, Mr. Feinberg affirmed his reconsideration
Case: 21-2086 Document: 33 Page: 4 Filed: 10/13/2022
4 HEKMATI v. US
decision. J.A. 197–98. He also specified some of the evi-
dence that led him to conclude that Mr. Hekmati intended
to sell classified national security information, including
an FBI forensic analysis of Mr. Hekmati’s “com-
puter/search access logs” while working as a contractor in
Afghanistan, his “evasive, false and inconsistent state-
ments” in FBI interviews, and the assertions of “four dif-
ferent, independent and reliable sources” that Mr.
Hekmati traveled to Iran primarily for reasons unrelated
to visiting his family. J.A. 199.
Mr. Hekmati then filed an amended complaint with the
Court of Federal Claims, asserting that the “‘reconsidera-
tion’ and subsequent recission of Mr. Hekmati’s final
award determination violate the terms of the USVSST
Act.” J.A. 81, 109. The Government moved to dismiss Mr.
Hekmati’s complaint for lack of subject-matter jurisdiction.
Hekmati, 153 Fed. Cl. at 802; J.A. 1533. The court granted
the motion, concluding that the Act, by providing its own
“detailed remedial scheme” where claimants can request a
hearing before the special master under § 20144(b)(4), pre-
vented Mr. Hekmati from invoking Court of Federal
Claims jurisdiction under the Tucker Act, 28 U.S.C. § 1491.
Hekmati, 153 Fed. Cl. at 802, 810. Alternatively, the court
reasoned that Mr. Hekmati’s claim required the court to
review the special master’s reconsideration decision, which
the Act precluded. Id. at 812. And even if Mr. Hekmati’s
claim were framed as a permissible challenge to the Fund’s
administration, the court concluded that it lacked jurisdic-
tion under the Tucker Act as to non-monetary relief with-
out there being a related claim for damages over which it
did have jurisdiction. Id. at 811, 813–14.
Mr. Hekmati appealed. We have jurisdiction under 28
U.S.C. § 1295(a)(3).
II. DISCUSSION
The Court of Federal Claims provided several reasons
for why it lacked subject-matter jurisdiction over Mr.
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HEKMATI v. US 5
Hekmati’s claim. Mr. Hekmati now contests each of those
reasons. We address whether the Act precludes judicial re-
view of Mr. Hekmati’s claim and conclude that it does. Ac-
cordingly, we end our analysis there.
We review a dismissal for lack of subject-matter juris-
diction de novo. Taylor v. United States, 959 F.3d 1081,
1086 (Fed. Cir. 2020). There is a “‘strong presumption’ in
favor of judicial review that we apply when we interpret
statutes, including statutes that may limit or preclude re-
view.” Cuozzo Speed Techs., LLC v. Lee, 579 U.S. 261, 273
(2016) (quoting Mach Mining, LLC v. EEOC, 575 U.S. 480,
486 (2015)). This presumption “may be overcome by ‘clear
and convincing’ indications, drawn from ‘specific language,’
‘specific legislative history,’ and ‘inferences of intent drawn
from the statutory scheme as a whole,’ that Congress in-
tended to bar review.” Id. (quoting Block v. Cmty. Nutri-
tion Inst., 467 U.S. 340, 349–50 (1984)).
The Act includes specific language that Congress in-
tended to bar judicial review of certain claims. Namely, the
Act provides that all “decisions made by the Special Master
with regard to compensation from the Fund” are “final” and
“not subject to . . . judicial review.” 1 34 U.S.C.
§ 20144(b)(3)(B). Therefore, we must determine whether
Mr. Hekmati’s claim requires the Court of Federal Claims
to review a “decision[] made by the Special Master with re-
gard to compensation from the Fund.”
1 Section 20144(b)(3)(B)’s bar on “administrative or
judicial review” is subject to an exception under
§ 20144(b)(4), which provides that a “claimant whose claim
is denied in whole or in part by the Special Master may
request a hearing before the Special Master.” 34 U.S.C.
§ 20144(b)(4). Mr. Hekmati requested and received such
an administrative hearing, J.A. 197–99, and so this excep-
tion is not relevant to the issue of whether the Court of
Federal Claims has subject-matter jurisdiction.
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6 HEKMATI v. US
We reject Mr. Hekmati’s arguments. Mr. Hekmati
seeks review of the special master’s reconsideration deci-
sion. Mr. Hekmati argues that he does not seek review of
the reconsideration decision because he is attempting
“merely to enforce the USVSST Act.” Appellant’s Br. 24.
Therefore, he argues that he is merely raising a “program-
matic challenge[]” to the Fund’s administration. Appel-
lant’s Br. 31–32. But Mr. Hekmati’s operative complaint
alleges that the “‘reconsideration’ and subsequent recission
of Mr. Hekmati’s final award determination violate the
terms of the USVSST Act.” J.A. 109. This allegation is, of
course, necessary; if the reconsideration decision denying
Mr. Hekmati’s claim is valid, then there is no award to Mr.
Hekmati for the Court of Federal Claims to enforce. For
Mr. Hekmati to succeed, the court must review whether
Mr. Feinberg’s reconsideration decision complies with the
Act.
Mr. Feinberg’s reconsideration decision constitutes a
“decision[] made by the Special Master with regard to com-
pensation from the Fund.” 34 U.S.C. § 20144(b)(3). Mr.
Hekmati argues that the special master lacked authority
to issue a reconsideration decision in the first place, mean-
ing that it is procedurally invalid. Appellant’s Br. 33. The
Act does not expressly provide a procedure by which the
special master can reconsider decisions. See 34 U.S.C.
§ 20144. But courts “have uniformly concluded that ad-
ministrative agencies possess inherent authority to recon-
sider their decisions, subject to certain limitations,
regardless of whether they possess explicit statutory au-
thority to do so.” Tokyo Kikai Seisakusho, Ltd. v. United
States, 529 F.3d 1352, 1360 (Fed. Cir. 2008) (collecting ci-
tations). For example, in Tokyo Kikai, we affirmed the De-
partment of Commerce’s inherent authority to reopen and
reconsider a yearly administrative review of an antidump-
ing order. Id. at 1359–62. And in GTNX, Inc. v. INTTRA,
Inc., we held that the Patent Trial and Appeal Board has
the inherent authority to reconsider its decisions to
Case: 21-2086 Document: 33 Page: 7 Filed: 10/13/2022
HEKMATI v. US 7
institute inter partes review. 789 F.3d 1309, 1312–13 (Fed.
Cir. 2015).
Nevertheless, there are three limits on this authority
pertinent to this case. 2 First, an agency cannot “exercise
its inherent authority in a manner that is contrary to a
statute.” Tokyo Kikai, 529 F.3d at 1361; see Bookman v.
United States, 453 F.2d 1263, 1265 (Ct. Cl. 1972) (noting
that courts “will sustain the reconsidered decision of an
agency” “absent contrary legislative intent or other affirm-
ative evidence”). Second, where a statute “expressly pro-
vide[s] for reconsideration of decisions, the agency is
obligated to follow the procedures for reconsideration set
forth in the statute.” Tokyo Kikai, 529 F.3d at 1361; Civ.
Aeronautics Bd. v. Delta Air Lines, Inc., 367 U.S. 316, 329
(1961) (holding that if the agency wishes to reconsider its
decision, “it must proceed in the manner authorized by
statute”). And third, the agency must “give notice to the
parties of its intent to reconsider, and such reconsideration
must occur within a reasonable time.” Tokyo Kikai, 529
F.3d at 1361.
2 Tokyo Kikai also provides that “an agency may not
reconsider in a manner that would be arbitrary, capricious,
or an abuse of discretion.” 529 F.3d at 1361. This exception
is not applicable here. To determine whether Mr. Fein-
berg’s reconsideration was arbitrary, capricious, or an
abuse of discretion, we would need to reach the merits of
Mr. Feinberg’s reconsideration decision. We cannot engage
in such an analysis of the merits, however, because we are
considering whether the Court of Federal Claims has sub-
ject-matter jurisdiction, an issue that must be resolved be-
fore reaching the merits. See Martin v. Sec’y of Health &
Hum. Servs., 62 F.3d 1403, 1407 (Fed. Cir. 1995) (holding
that a court must first “establish that there is jurisdiction”
and “[o]nly then may it adjudicate the merits of the claim”).
Case: 21-2086 Document: 33 Page: 8 Filed: 10/13/2022
8 HEKMATI v. US
No limit applies here. No provision expressly bars the
special master’s reconsideration decision. See 34 U.S.C.
§ 20144. The Act does state that all “decisions made by the
Special Master with regard to compensation from the
Fund” are “final and . . . not subject to administrative or
judicial review.” 34 U.S.C. § 20144(b)(3)(B). But we have
held that an agency can reconsider a decision even if a stat-
ute provides that such a decision is “final.” Medtronic, Inc.
v. Robert Bosch Healthcare Sys., Inc., 839 F.3d 1382,
1385–86 (Fed. Cir. 2016) (citing GTNX, 789 F.3d at
1312–13). In Medtronic, we addressed 35 U.S.C. § 314(d),
which provides that a decision to institute inter partes re-
view “shall be final and nonappealable.” 839 F.3d at 1383.
We held that the Board can reconsider institution decisions
despite § 314(d) because the language of that provision “is
not limited to an initial determination.” Medtronic, 839
F.3d at 1386 (quoting GTNX, 789 F.3d at 1312). Similarly,
34 U.S.C. § 20144(b)(3)(B) is not limited to an initial deci-
sion, and so it does not bar reconsideration.
Nor could Mr. Feinberg have run afoul of the second
limit. The Act does not expressly provide a procedure for
the special master to reconsider his decisions. See 34
U.S.C. § 20144. Thus, the Act could not obligate Mr. Fein-
berg to proceed differently with his reconsideration. See
Tokyo Kikai, 529 F.3d at 1361 (holding similarly).
At oral argument, Mr. Hekmati focused on the third
limit. See Oral Arg. at 04:35–13:02, https://oralargu-
ments.cafc.uscourts.gov/default.aspx?fl=21-
2086_02082022.mp3. He did not contend that he lacked
notice of the reconsideration. Indeed, Ms. Connor informed
Mr. Hekmati on October 24, 2019, that Mr. Feinberg would
reconsider his earlier decision. J.A. 175. Rather, Mr. Hek-
mati argued that reconsideration did not occur within a
reasonable time. See Oral Arg. at 04:35–13:02. We disa-
gree.
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HEKMATI v. US 9
Our predecessor court noted that a “reasonable time
period will vary with each case, but absent unusual circum-
stances, the time period would be measured in weeks, not
years.” Gratehouse v. United States, 512 F.2d 1104, 1109
(Ct. Cl. 1975); see Oral Arg. at 08:05–08:18 (Mr. Hekmati
arguing that reconsideration is only reasonable if it occurs
within weeks of the initial decision). But this case is one of
those unusual circumstances because Mr. Feinberg “con-
sider[ed] new evidence that [Fund] proceedings were
tainted by fraud.” 3 See Home Prods. Int’l, Inc. v. United
States, 633 F.3d 1369, 1377 (Fed. Cir. 2011). We have held
that an “agency’s power to reconsider is even more funda-
mental when, as here, it is exercised to protect the integrity
of its own proceedings from fraud.” Tokyo Kikai, 529 F.3d
at 1361 (citing Alberta Gas Chems., Ltd. v. Celanese Corp.,
650 F.2d 9, 12 (2d Cir. 1981)). This conclusion reflects the
Supreme Court’s holding that when a question of adminis-
trative reconsideration emerges, “two opposing policies im-
mediately demand recognition: the desirability of finality,
on the one hand, and the public interest in reaching [w]hat,
ultimately, appears to be the right result on the other.”
Civ. Aeronautics Bd., 367 U.S. at 321. Fraud implicates
the public interest in reaching the right result.
At oral argument, Mr. Hekmati argued that Tokyo
Kikai shows that reconsideration must occur within a rea-
sonable time even if there was a discovery of fraud. Oral
Arg. at 06:56–07:36. Indeed, the Fund must issue its re-
consideration decision “within a reasonable time after
3 While we cannot determine whether Mr. Feinberg
was correct in determining that Mr. Hekmati’s Fund appli-
cation “contained material omissions and false state-
ments,” J.A. 177, Mr. Feinberg exercised his authority to
reconsider his earlier decision “to protect the integrity of
[the Fund’s] proceedings from fraud,” Tokyo Kikai, 529
F.3d at 1361.
Case: 21-2086 Document: 33 Page: 10 Filed: 10/13/2022
10 HEKMATI v. US
learning of information indicating that the decision may
have been tainted by fraud.” Tokyo Kikai, 529 F.3d at
1361–62. But the timing of the Fund’s reconsideration
here is analogous to that of the Department of Commerce
in Tokyo Kikai. In that case, we concluded that it was rea-
sonable for Commerce to issue its reconsideration order in
March 2006—ten months after May 2005, the latest time
when Commerce could have learned of the relevant fraud.
Id. at 1357, 1361–62.
Here, the record does not show exactly when the Fund
learned of the Department of Justice’s concerns that Mr.
Hekmati provided false information in his application. Mr.
Hekmati suggests that the Fund must have learned of the
Department of Justice’s concerns in January 2019 because
that is when the Fund distributed payments to all claim-
ants besides Mr. Hekmati. Oral Arg. at 08:41–08:50; see
also Appellant’s Br. 12 & n.36 (citing Kenneth R. Feinberg,
Report Regarding Second Distribution 10 (Feb. 2019),
http://www.usvsst.com/docs/Congressional_Report.pdf).
But even if we accept Mr. Hekmati’s argument that the
Fund learned of the relevant information in January 2019,
the special master would have issued his reconsideration
decision twelve months later in January 2020. J.A. 177.
This time period is only a few months longer than Com-
merce took in Tokyo Kikai. And the Fund had additional
hurdles to face: the Department of Justice and the Fund
had to navigate how the Department of Justice’s evidence
would be declassified so that the special master and Mr.
Hekmati could review it. Oral Arg. at 18:00–18:30. Be-
cause of our decision in Tokyo Kikai and the unique chal-
lenges presented in this case in navigating classified
evidence, we hold that the special master issued his recon-
sideration decision within a reasonable time. Thus, the re-
consideration decision was a valid exercise of the Fund’s
inherent authority to reconsider its decisions.
Because the special master’s reconsideration decision
is a valid “decision[] made by the Special Master with
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HEKMATI v. US 11
regard to compensation from the Fund,” § 20144(b)(3)(B)
precludes judicial review of that decision. 4 The Court of
Federal Claims therefore does not have subject-matter ju-
risdiction over Mr. Hekmati’s claim. Accordingly, we need
not reach Mr. Hekmati’s other arguments.
***
We do not have the evidence that led Mr. Feinberg to
conclude that Mr. Hekmati attempted to sell classified na-
tional security information to the Iranian government. Nor
do we attempt to discern whether Mr. Feinberg correctly
reached that determination. All we conclude is that the
Court of Federal Claims cannot review the special master’s
decision because Congress did not give it jurisdiction to do
so under 34 U.S.C. § 20144.
III. CONCLUSION
For the foregoing reasons, we affirm the decision of the
Court of Federal Claims.
AFFIRMED
COSTS
No costs.
4 We need not decide whether the Act precludes any
review of a decision of the special master to reconsider, re-
gardless of the circumstances. All we hold is that the spe-
cial master did not lack authority to reconsider in this case
and that the Act precludes review of the merits of the spe-
cial master’s reconsideration decision.