Court Opinion

ID: 6332834
Source: CourtListenerOpinion
Date Created: 2022-04-19 15:00:29.065899+00
Date Added: 2024-06-11T09:23:23.404725
License: Public Domain

United States Court of Appeals
          FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 14, 2022                Decided April 19, 2022

                         No. 21-5088

                       MURRAY BRAUN,
                        APPELLANT

                               v.

             UNITED STATES OF AMERICA, ET AL.,
                       APPELLEES

         Appeal from the United States District Court
                 for the District of Columbia
                     (No. 1:20-cv-02613)

    Robert J. Tolchin argued the cause and filed the briefs for
appellant.

     Jerry S. Goldman argued the cause for amici curiae
Christine I. O=Neill, et al. in support of appellant. With him on
the brief were Jodi Westbrook Flowers, Hon. Ethan Greenberg
(Ret.), and Bruce Strong.

    Joshua M. Koppel, Attorney, U.S. Department of Justice,
argued the cause for appellees. With him on the brief were
Brian M. Boynton, Acting Assistant Attorney General at the
time of briefing, and Sharon Swingle, Attorney.
                               2
    Before: HENDERSON, TATEL, and MILLETT, Circuit
Judges.

    Opinion for the court filed by Circuit Judge TATEL.

     TATEL, Circuit Judge: This case traces its roots to an
especially appalling atrocity: the killing of a three-month-old
girl by a Hamas terrorist. Unable to undo the human toll of such
attacks, Congress has sought to provide victims with monetary
compensation through a fund established by the Justice for
United States Victims of State Sponsored Terrorism Act.
Pursuant to that statute, known as the “Terrorism Act,” the
child’s grandfather, Murray Braun, has received roughly
$250,000 of a multimillion-dollar judgment against the Islamic
Republic of Iran, a state sponsor of terrorism. Contending that
the law requires more prompt and regular payment to claimants
like himself, Braun sued the federal officials administering the
fund. The district court concluded that the government’s
distribution of funds was consistent with the statute and
dismissed the complaint. For the reasons set forth below, we
affirm.

                               I.
     The Foreign Sovereign Immunities Act authorizes courts
to order foreign state sponsors of terrorism to pay damages to
their victims. See 28 U.S.C. §§ 1605A, 1606. Because such
states are unlikely to pay, Congress passed the Terrorism Act
in 2015, which established a fund to compensate claimants.
Pub. L. No. 114-113, 129 Stat. 2242, 3007 (2015) (codified as
amended at 34 U.S.C. § 20144). The statute drew on two
different sources of funding: (1) an initial appropriation of
$1.025 billion from “money in the Treasury not otherwise
appropriated” (“General Fund”); and (2) proceeds from
penalties paid by companies and individuals that violate
sanctions imposed on state sponsors of terrorism, specifically,
                                3
one hundred percent of criminal penalties and fifty percent of
civil penalties. Id. § 404(e)(2), (e)(5).

     In addition to establishing the fund, the Terrorism Act sets
forth rules for the fund’s administration. If the fund’s balance
exceeds $100 million, the Attorney General must appoint a
special master, 34 U.S.C. § 20144(b)(1)(A), who in turn is
responsible for promulgating procedures to determine claim
eligibility, id. § 20144(b)(2)(A), and for “authoriz[ing] . . .
payments” to claimants, which the statute requires be made
annually “if funds are available,” id. § 20144(d)(4)(A).
Because the aggregate eligible claims exceed the fund’s
balance, for every round of payment, the special master
calculates the pro rata amount that each claimant should
receive and authorizes payment accordingly. Id. § 20144(d)(3).
Claimants continue to receive payment in each round of
distribution until they have received the total amounts of their
claims or until the fund’s end date, currently set for
January 2, 2039. Id. § 20144(e)(6).

     In 2019, after the fund had made two rounds of payments,
Congress amended the Terrorism Act through the United States
Victims of State Sponsored Terrorism Fund Clarification Act.
Pub. L. No. 116-69, 133 Stat. 1134, 1140 (2019) (codified at
34 U.S.C. § 20144). Known as the “Clarification Act,” the
amendments significantly expanded the number of eligible
claimants by opening the fund to those who had received an
award or award determination from the 9/11 Victim
Compensation Fund. Id. § 1701(b). Simultaneously, the
Clarification Act amendments increased the percentage of civil
penalties that would go into the Terrorism Act fund from fifty
to seventy-five percent, id., set an extended timeline for issuing
third-round payments, id., and provided that these amendments
would take effect “on the date of enactment of this Act,” id.
§ 1701(d).
                                4
     On October 22, 2014, a Hamas operative intentionally
rammed his car into a crowd of pedestrians at a light rail station
in Jerusalem. Braun v. Islamic Republic of Iran, 228
F. Supp. 3d 64, 72 (D.D.C. 2017). He killed three-month-old
Chaya Zissel Braun and badly injured her father, both United
States citizens.

     Following the attack, Chaya Zissel’s estate, parents, and
grandparents filed suit against several defendants, including the
Islamic Republic of Iran as a state sponsor of Hamas. When the
defendants failed to appear, the district court entered default
judgments for the plaintiffs: $1 million to Chaya Zissel’s
estate; $8.75 million to each parent; $2.5 million to each
grandparent; and $150 million in punitive damages.

     Murray Braun, Chaya Zissel’s grandfather, then applied to
the fund for compensation. He was found eligible for
$2.5 million and received almost $105,000 from the second-
round distribution in January 2019. In August 2020, he was
notified that he would receive an additional $146,000 from the
third-round distribution. That same summer, the fund
announced that there would be no fourth-round distribution in
2021 because insufficient funds were available.

     In September 2020, after receiving notice of his third-
round entitlement but before receiving payment, Braun filed
this action against the fund’s administrators. He sought
declaratory and injunctive relief on four claims: (1) that the
Clarification Act’s increased percentage provision applies to
civil penalties collected between the passage of the Terrorism
Act and the Clarification Act; (2) that the fund is obligated to
make a supplemental payment reflecting the fund’s increased
share of those past penalties; (3) that the Attorney General must
appoint a special master who must make a distribution when
the fund’s balance exceeds $100 million; and (4) that the fund
                                5
was required to make third-round payments by May 19, 2020
and is otherwise required to make payments by January 1 of
each year for which a distribution will be made. The next
month, Braun received his third-round payment in the amount
of $145,963.33.

    The government moved to dismiss, the district court
granted the motion, Braun v. United States, 531 F. Supp. 3d
130 (D.D.C. 2021), and Braun now appeals. Our review is de
novo. Webb v. United States Veterans Initiative, 993 F.3d 970,
971–72 (D.C. Cir. 2021) (noting that dismissals under Federal
Rules of Civil Procedure 12(b)(1) and 12(b)(6) are reviewed de
novo).

                               II.
     We begin with Braun’s first claim, that the amendment
increasing the fund’s share of civil penalties from fifty to
seventy-five percent applies not only to penalties collected
after the Clarification Act amendments, but also retroactively
to penalties assessed between the passage of the Terrorism Act
(December 18, 2015) and the Clarification Act
(November 21, 2019). In support, Braun relies on language in
the Terrorism Act as originally enacted, which entitled the fund
to “[o]ne-half of all funds, and one-half of the net proceeds
from the sale of property, forfeited or paid to the United States
after the date of enactment of this Act”—“after December 18,
2015.” Pub. L. No. 114-113 § 404(e)(2)(A)(ii) (emphasis
added); 34 U.S.C. § 20144(e)(2)(A)(ii) (2018). The
Clarification Act changed “one-half” to “seventy-five” percent
but left the 2015 date unaltered. Thus, Braun contends, the
increase applies to all penalties “forfeited or paid to the United
States     after     December 18,       2015.”      34      U.S.C.
§ 20144(e)(2)(A)(ii). Practically speaking, Braun believes this
means the amendment “required Treasury to do a simple
arithmetic calculation: calculate half the amount already
                                6
deposited in the [f]und from the civil sanctions since December
18, 2015, add that amount to the [f]und, and let it be distributed
pursuant to the [Terrorism] Act.” Appellant’s Br. 31.
According to the government, because those penalty proceeds
have already been spent, this amount would have to come from
the Treasury’s General Fund.

     Braun’s interpretation of the statute is untenable for
several reasons. To begin with, as the district court pointed out,
the Clarification Act’s applicability provision expressly states
that “[t]his section and the amendments made by this section
shall take effect on the date of enactment of this Act,”
November 21, 2019. Pub. L. No. 116-69 § 1701(d); see also
Braun, 531 F. Supp. 3d at 137. Because the increase from fifty
to seventy-five percent is one such amendment, it became
effective on November 21, 2019 and no earlier.

     Braun insists that the statute’s “plain language” requires
that we give effect to provisions retaining the 2015 date.
Appellant’s Reply Br. 4. But this would produce an absurd
result. Read literally, the statute as amended requires the
government to deposit the requisite percentages from criminal
and civil penalties into the fund “[b]eginning on
December 18, 2015,” 34 U.S.C. § 20144(e)(2), which of
course is impossible, given that the Clarification Act—which
authorized the increase to seventy-five percent—had not yet
been passed. This is one of those “absurdities of literalism that
show that Congress could not have been writing in a literalistic
frame of mind.” Corley v. United States, 556 U.S. 303, 317
(2009).

    Two other interpretive rules further undermine Braun’s
position. First, because “[r]etroactivity is not favored in the
law,” “congressional enactments . . . will not be construed to
have retroactive effect unless their language requires this
                              7
result.” Bowen v. Georgetown University Hospital, 488 U.S.
204, 208 (1988) (emphasis added). This canon reflects
Congress’s proven ability to make clear when it wants a statute
to have retroactive effect. For example, the Federal Home Loan
Bank Act makes certain money deposited in the Treasury
“available . . . retroactively as well as prospectively.” 12
U.S.C. § 1439a. Similarly, the now-repealed Black Lung
Benefits Reform Act required the Secretary of Labor to
reevaluate previously denied claims and award qualifying
claimants benefits “on a retroactive basis.” 30 U.S.C. § 945(c)
(repealed 2002). The Terrorism Act as amended contains no
such express language requiring retroactive application.

     Braun argues that “retroactive application of a new law
really has nothing to do with this case,” because he seeks only
“to apply the current law, exactly as it is written, to the
present.” Appellant’s Br. 27. Yet even so viewed, Braun’s
reading runs up against a second obstacle: as Congress itself
has made clear, “[a] law may be construed to make an
appropriation out of the Treasury . . . only if the law
specifically states that an appropriation is made.” 31 U.S.C.
§ 1301(d). As Braun concedes, to give effect to his
interpretation, we would have to order the Treasury to make an
appropriation from the General Fund. Yet the statute authorizes
no such general appropriation. To the contrary, the Terrorism
Act establishes a two-part funding scheme, only the first of
which is funded by appropriations. Specifically, Congress
(1) “appropriated” $1.025 billion “for fiscal year 2017” and
(2) directed that the fund receive “[f]orfeited funds and
property” thereafter. See 34 U.S.C. § 20144(e)(5) (initial
appropriation); id. § 20144(e)(2) (penalty funding).

     Because the statute nowhere authorizes the retroactive
increase of penalties collected prior to the Clarification Act
amendments, we shall affirm the district court’s dismissal of
                                8
this claim. Braun, 531 F. Supp. 3d at 137. And because, as
Braun concedes, we need reach his second claim only “[i]n the
event [that he] prevails on Count 1,” we shall also affirm the
district court’s dismissal of his second claim. Appellant’s
Br. 35.

     Braun’s third claim, as argued to the district court, sought
an injunction “requiring the Attorney General ‘to appoint a
[s]pecial [m]aster going forward if there is more than $100
million in the [f]und’ and ordering that the [s]pecial [m]aster
‘make a distribution in 2021.’” Braun, 531 F. Supp. 3d at 138
(quoting Compl. ¶¶ 4, 59). The district court dismissed the first
part of this claim because on January 4, 2021, the fund
appointed a special master, rendering the request for an
appointment moot. Id.; see also True the Vote, Inc. v. IRS, 831
F.3d 551, 558 (D.C. Cir. 2016) (“Even where a case once posed
a live controversy when filed, the mootness doctrine requires
the Court to refrain from deciding it if events have so transpired
that the decision will neither presently affect the parties’ rights
nor have a more-than-speculative chance of affecting them in
the future.” (cleaned up)). Braun did not challenge this aspect
of the district court’s decision in his appellate briefs. But two
days before oral argument, in a supplemental letter to the court,
he argued that the current special master’s term had expired
“about five weeks ago, on January 4, 2022,” and that his
request for an injunction to appoint a special master “is
[therefore] no longer moot.” 28(j) Letter at 1–2,
Braun v. United States, No. 21-5088 (Feb. 12, 2022). We
decline to resolve without briefing this late-raised issue, as well
as his even-later-raised argument that appointment of a special
master must be by the Attorney General. 28(j) Letter at 1,
Braun v. United States, No. 21-5088 (Feb. 13, 2022). If Braun
wishes to pursue these arguments, he may file an amended
complaint in the district court.
                                9
      As for the remainder of this claim, Braun argues that once
the fund’s balance exceeds $100 million, “the special master is
required to distribute all the money in the [f]und to claimants.”
Appellant’s Br. 36–37. But as the district court explained, the
statute “does not set a threshold for mandating distributions
from the [f]und.” Braun, 531 F. Supp. 3d at 138. Instead, the
special master must authorize payments “if funds are
available.” 34 U.S.C. § 20144(d)(4)(A). Critically for our
purposes, however, all funds are not necessarily “available” for
distribution. The statute instructs that the fund’s personnel
costs and other administrative costs “shall be paid from the
[f]und,” id. § 20144(b)(1)(B), and further requires the special
master to “allocate but withhold payment” to so-called
conditional claimants, who are still awaiting adverse final
judgments in court but otherwise qualify for the fund, id.
§ 20144(e)(2)(B)(iv). As a result, the fund “may contain more
than $100 million but have no money available for a
distribution because of statutorily required reserves for
conditional claimants and administrative expenses.”
Appellees’ Br. 20. To illustrate this point, the government
reports that in the second-round distribution, payments set
aside “for conditional claimants totaled nearly $81 million,”
and “those reserved funds [were] even greater” in the third-
round distribution. Id. at 42. In reply, Braun claims that “2021
is now over and the time has expired for any claimants to
qualify for” the fourth-round distribution. Appellant’s Reply
Br. 11. But that misses the point: as the government has
explained, it is possible for the fund to exceed $100 million and
still lack “available” funds, making it inappropriate to treat that
amount as an obligatory threshold for distribution. To be sure,
there may be limits to the special master’s discretion when
determining fund availability, but Braun makes no such
argument. Accordingly, we shall affirm the district court’s
dismissal of Braun’s third claim.
                               10
     Braun’s fourth claim has two parts. First, he contends that
the Clarification Act’s modified timeline for third-round
payments required the fund to pay claimants by May 19, 2020,
“180 days . . . after the date of enactment” of the Clarification
Act. Pub. L. No. 116–69 § 1701(b). Braun acknowledges that
he has now received his third-round payment yet insists that
this does not render his claim moot because the fund “has still
not paid out the distributions to some Third-Round-eligible
claimants.” Appellant’s Br. 23. But because Braun obviously
lacks standing to pursue this action on other claimants’ behalf,
we shall dismiss this part of his claim as moot.

     The second part of Braun’s claim concerns the statutory
timeline applicable to payments other than the third-round
distribution. The statute provides that “on January 1 of the
second calendar year that begins after the date of the initial
payments . . . the [s]pecial [m]aster shall authorize additional
payments on a pro rata basis . . . and shall authorize additional
payments for eligible claims annually thereafter.” 34 U.S.C.
§ 20144(d)(4)(A). Although the parties agree that this
provision establishes a mandatory deadline for authorizing
payment, they disagree about what that means.

    To understand the parties’ dispute, we think it helpful to
describe the notices the fund sent to Braun regarding his claim.
On May 18, 2017, the fund sent Braun a notice that it had
“determined [his] claim to be eligible” for $2.5 million. First
Notice, Appendix (Appx.) 72. The letter continued:

    Although the . . . [f]und has determined that your
    claim is eligible, please note that there is no guarantee
    that you will receive the total eligible claim amount.
    Rather, the amount of your first payment will be
    calculated after the . . . [f]und determines the amount
    of funds available from which to pay claims and after
                               11
    any statutory limitations are applied to the total
    eligible claim amount shown above. You will be
    notified about the exact amount of your first payment
    after the [s]pecial [m]aster authorizes the next
    distribution in January 2019.

Id. A year and a half later, on December 13, 2018, the fund
notified Braun that his “allocated payment amount for this
distribution [was] $104,887.61.” Second Notice, Appx. 74. The
notice instructed Braun to complete a direct deposit form if he
had not already done so but otherwise articulated no further
steps necessary to receive payment. Id. Braun received
payment the following month. Then, in August 2020, Braun
was sent a letter stating that his third-round distribution would
be $145,963.33. Lee Decl., Appx. 107 ¶ 4.

     Braun contends that none of these notices satisfy the
Terrorism Act’s requirement to “authorize . . . payment[].” 34
U.S.C. § 20144(d)(4)(A). To authorize payment, he argues,
means to “actually pay money to any claimant by” January 1.
Appellant’s Br. 38. But as the government argues, the words
“authorize” and “expend” have different meanings, and if
Congress had meant to require the government to “pay” or
“expend” funds by January 1, it would have said so directly.
The statute’s sunset clause demonstrates that Congress not only
knew how to use the word “expend,” but also imbued it with
meaning distinct from payment authorization. That clause
provides that “on the day after all amounts authorized to be
paid from the [f]und . . . that were obligated before January 2,
2039 are expended, any unobligated balances in the [f]und shall
be transferred” to other funds. 34 U.S.C. § 20144(e)(6)(B)
(emphasis added). “This meaningful variation,” the district
court explained, “clarifies that ‘authorize’ does not simply
mean ‘expend’ or ‘pay.’” Braun, 531 F. Supp. 3d at 139.
Instead, “authorization is a precursor to expenditure.” Id.
                               12
     For its part, the government equates “authoriz[ing] . . .
payment[]” with determining claim eligibility. 34 U.S.C.
§ 20144(d)(4)(A). Under this interpretation, authorization
occurred when the government sent Braun the May 18, 2017
notice recognizing his claim to $2.5 million. But this reading
also has flaws. For one thing, the provision containing the
January 1 deadline appears in the subsection dedicated to
payments, not claim eligibility. Compare 34 U.S.C. § 20144(d)
with id. § 20144(c). Moreover, as Braun points out, “eligibility
letters are issued only one time after a claimant submits a claim,
and are not re-issued in subsequent years to claimants already
determined to be eligible,” putting the government’s reading in
tension with the provision’s instruction to “authorize additional
payments for eligible claims annually thereafter if funds are
available.” Appellant’s Br. 40 (first quote); 34 U.S.C.
§ 20144(d)(4)(A) (second quote) (emphasis added). And
finally, the May 18, 2017 eligibility notice by its own terms
distinguishes itself from payment authorization, notifying
Braun that he will learn the exact amount of his first payment
“after the [s]pecial [m]aster authorizes the next distribution.”
First Notice, Appx. 72 (emphasis added).

     There is a third possible interpretation: that payment
authorization occurs when the fund issues a notice allocating a
specific payment amount for distribution. Viewed this way, it
was the December 2018 letter advising Braun that his
“allocated payment amount for this distribution [was]
$104,887.61” that authorized payment. Second Notice,
Appx. 74. Interpreting payment authorization this way would
serve two purposes. First, it would require more than a
threshold determination that a claim is eligible and comport
with the statute’s requirement that the fund “authorize
additional payments on a pro rata basis” and do so “annually.”
34 U.S.C. § 20144(d)(4)(A). And second, it would stop short
                              13
of “payment,” thus giving meaning to Congress’s
differentiated use of “authorize payment” and “expend.”

     At oral argument, however, Braun’s counsel disavowed
this interpretation, contending that the notice merely “tell[s]
somebody how much they might one day expect to get if
payment is ever made,” which would, in his view, allow an
unacceptable delay in actual payment. This leaves us with
Braun’s untenable reading of the statute, which the district
court correctly rejected. We shall therefore affirm the district
court’s dismissal of Braun’s fourth claim.

                                III.
    For the foregoing reasons, we affirm.

                                                    So ordered.