Sunday, October 1, 2023 | Back issues
Courthouse News Service Courthouse News Service

12 Suspected Terrorist Funders Held in Contempt

(CN) - A dozen companies suspected of financing terrorism were properly held in contempt and ordered to pay a total of $57,000 for withholding documents required by grand jury subpoenas, the 4th Circuit ruled.

Twelve companies challenged the district court's contempt orders: 11 claimed the orders were ambiguous, and one argued that it had "just cause" to ignore the orders, because it was the target of illegal wiretapping by the National Security Agency.

On the wiretapping challenge, Judge J. Harvie Wilkinson III said a grand jury enforcement action "is not the appropriate place to litigate the validity of ... surveillance claims."

The court also refused to overturn the contempt finding for the remaining companies, saying the district court "was in the best position to interpret its orders and the refusals of the other 11 appellants to comply with them."

Though the names of all 12 companies are sealed, the court described them as a group of interrelated for-profit and nonprofit corporations suspected of financing terrorism.

Their offices were searched in May 2002, and several documents were seized and placed in a storage unit by their shared attorney, Nancy Luque.

In early 2006, an unrelated grand jury issued subpoenas demanding corporate records and accounting, among other things.

Before instructing her clients to hand over any documents, Luque wanted the government to confirm or deny whether it had wiretapped any of the companies under a provision of the Foreign Intelligence Surveillance Act.

The government promptly denied any FISA surveillance, but insisted the companies weren't entitled to be notified of any other surveillance.

The companies produced no documents through 2006, prompting the district court to demand full compliance with the subpoenas.

On May 2, U.S. District Judge Gerald Bruce Lee stated, "I'm going to order them to appear May 4. ... [T]hey're ordered to appear before the grand jury and to produce documents." He later added, "Ms. Luque's client is being given an unambiguous, clear order to comply."

But her clients didn't fully comply. Eleven companies produced limited documents, while the other, "Appellant #10," withheld all records based on its illegal surveillance claim.

Finding the companies in contempt, Judge Lee fined the 11 companies $39,000 and ordered Appellant #10 to pay $18,000.

The Richmond, Va.-based appeals court affirmed, calling the district court "the very embodiment of patience."

"When ordered to comply with the subpoenas in the explicit terms used by the district court, it is impossible to give credence to arguments that they were uncertain what was required," Judge Wilkinson wrote. "In light of such direct wording, there is no room to argue that the district court abused its discretion."

Chief Judge William Traxler dissented in part, objecting only to the fine imposed on Appellant #10.

Categories / Uncategorized

Read the Top 8

Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.