American Airways Charters, Inc. v. Regan
[…] [footnotes omitted]
This case concerns the right of a Florida corporation, specially designated a "Cuban national" pursuant to section 5(b) of the Trading with the Enemy Act, 50 U.S.C. app. Sec. 5(b) (1982) (TWEA or Act), to choose and retain counsel without obtaining in advance a government (Treasury Department, Office of Foreign Assets Control) license to do so. We hold that although government permission, in the form of an Office of Foreign Assets Control license, is required prior to the execution of any transaction reaching the assets of a designated Cuban national, the Office of Foreign Assets Control lacks authority to condition the bare formation of an attorney-client relationship on advance government approval.
The administrative authority asserted in this case has never been asserted on any prior occasion; the controlling legislation, were we to...
1) OFAC’S JURISDICTION OVER THE FORMATION OF ATTORNEY-CLIENT RELATIONSHIPS; UNCOMPENSATED LEGAL REPRESENTATION
Prior to this decision, OFAC considered the TWEA (and presumably IEEPA) to give OFAC jurisdiction over the formation of attorney-client relationships between sanctioned persons and persons subject to U.S. jurisdiction. Here, the D.C. Circuit makes clear that this is not the case, i.e. that "the Office of Foreign Assets Control lacks authority [under TWEA] to condition the bare formation of an attorney-client relationship on advance government approval."
OFAC's current practices are not entirely inconsistent with this opinion, and the USG has acknowledged it in various fora. See e.g. the USG/OFAC appellate brief in Empresa Cubana Exportadora v. Department of Treasury, et al. (D.C. Cir. 2011). The brief cites American Airways Charters,...