UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
BAHMAN GROUP,
Plaintiff,
No. 19-cv-2022 (RDM)
v.
ANDREA M. GACKI, et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiff Bahman Group seeks to supplement the administrative record of the proceeding
that led to the Office of Foreign Assets Control’s (“OFAC”) decision to designate it as a
Specially Designated National and to add it to the Blocked Persons List pursuant to Executive
Order 13224. Dkt. 19. Although the administrative decision that Plaintiff challenges is based
upon the agency’s conclusion that Plaintiff “materially assisted, sponsored, or provided financial,
material, or technological support for, or goods or services to or in support of, the Islamic
Revolutionary Guard Corps” (“IRGC”), Dkt. 21-1 at 17–18, Plaintiff seeks to add materials
assembled in an earlier designation and blocking proceeding that was premised on Plaintiff’s
support for an Iranian company, Andisheh Mehvaran Investment Company (“Andisheh
Mehvaran”), which was designated at the same time, id., Dkt. 21-3 at 5. OFAC opposes
Plaintiff’s motion, arguing that the materials pertaining to the earlier designation are unrelated to
the designation at issue here, which is based solely on Plaintiff’s alleged support for the IRGC.
Dkt. 22.
Upon consideration of Plaintiff’s motion to supplement the administrative record, Dkt.
21, Defendants’ opposition, Dkt. 22, and Plaintiff’s reply, Dkt. 23, the Court will DENY
Plaintiff’s motion to supplement the record.
I. BACKGROUND
On October 16, 2018, OFAC designated and blocked Plaintiff pursuant to Executive
Order 13224 based on its support for Andisheh Mehvaran. Dkt. 6 at 1. On February 19, 2019,
Plaintiff filed a request with OFAC for administrative reconsideration of that designation, Dkt. 1
at 5 (Compl. ¶ 15), and on July 7, 2019 Plaintiff filed the instant action challenging the
designation. Dkt. 1. Plaintiff’s administrative request for reconsideration was supported by
evidence that Andisheh Mehvaran had terminated its investment in Plaintiff prior to OFAC’s
original designation. See generally Dkt. 21-3; see also id. at 5 (“An insufficient basis exists for
[Plaintiff’s] designation, as [Andisheh Mehvaran] had terminated its investment in [Plaintiff]
prior to OFAC’s designation action and was thus no longer receiving financial support from
[Plaintiff] at that time.”). On October 10, 2019, OFAC informed Plaintiff (1) that its designation
based on its support for Andisheh Mehvaran had been rescinded and (2) that it had been re-
designated, this time based on its support for the IRGC. Dkt. 21-4 at 1.
The parties agreed that the re-designation “supersede[d] the original, former designation
that [was] the subject of Plaintiff’s [then-pending] [c]omplaint.” Dkt. 6 at 2. Given this
development, Plaintiff amended its complaint, see Dkt. 8; Dkt. 13, and OFAC “prepar[ed] a
redacted version of the administrative record underlying the new designation,” Dkt. 6 at 2; see
also Dkt. 10. Plaintiff now seeks to supplement the administrative record relating to the second
designation with materials from the earlier designation proceeding, Dkt. 21; Dkt. 23, and OFAC
opposes that motion, Dkt. 22.
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II. ANALYSIS
Judicial review of the lawfulness of an agency’s decision under 5 U.S.C. § 706 must be
“based on the full administrative record that was before the [agency] at the time [it] made [its]
decision.” Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 420 (1971), abrogated on
other grounds by Califano v. Sanders, 430 U.S. 99 (1977). “Courts in this Circuit have
‘interpreted the “whole record” to include “all documents and materials that the agency “directly
or indirectly considered” . . . [and nothing] more nor less.’” Bimini Superfast Operations LLC v.
Winkowski, 994 F. Supp. 2d 103, 105 (D.D.C. 2014) (citing cases). “If the . . . agency
decisionmakers considered, even indirectly, any . . . materials in reaching [the relevant] decision,
those materials should be included in the record.” Id. (citation and emphasis omitted). An
agency, moreover, “may not exclude information from the record simply because it did not ‘rely’
on the excluded information in its final decision.” Id. (citation omitted).
“Supplementation of the administrative record is the exception [and] not the rule.”
Conservation Force v. Salazar, No. 10-1262, 2012 WL 11947683, at *2 (D.D.C. Feb. 6, 2012).
“[A]bsent clear evidence to the contrary, an agency is entitled to a strong presumption of
regularity[] that it properly designated the administrative record.” Pac. Shores Subdivision, Cal.
Water Dist. v. U.S. Army Corps of Eng’rs, 448 F. Supp. 2d 1, 5 (D.D.C. 2006). The agency is
entitled to this presumption because “courts [must] base their review of an agency’s actions on
the materials that were before the agency at the time its decision was made,” IMS, P.C. v.
Alvarez, 129 F.3d 618, 623 (D.C. Cir. 1997), and the agency is best situated to know what
materials were before it when it acted, see Pac. Shores, 448 F. Supp. 2d at 5. Supplementation is
appropriate “(1) if the agency ‘deliberately or negligently excluded documents that may have
been adverse to its decision,’ (2) if background information [is] needed ‘to determine whether
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the agency considered all the relevant factors,’ or (3) if the ‘agency failed to explain
administrative action so as to frustrate judicial review.’” City of Dania Beach v. Fed. Aviation
Admin., 628 F.3d 581, 590 (D.C. Cir. 2010) (quoting Am. Wildlands v. Kempthorne, 530 F.3d
991, 1002 (D.C. Cir. 2008)). Here, Plaintiff invokes only the first of these exceptions, see Dkt.
21-1 at 12, but it has failed to carry its burden of presenting “concrete evidence,” Nat’l Mining
Ass’n v. Jackson, 856 F. Supp. 2d 150, 156 (D.D.C. 2012) (quoting Marcum v. Salazar, 751 F.
Supp. 2d 74, 78 (D.D.C. 2010)), sufficient to override the “strong presumption” that OFAC
properly assembled the administrative record for its October 10, 2019 decision designating
Plaintiff based on its support for the IRGC, Pac. Shores, 448 F. Supp. 2d at 5.
According to Plaintiff, at the time OFAC decided to re-designate Plaintiff based on its
relationship with the IRGC, the agency must have considered materials pertaining to OFAC’s
earlier decisions to designate and then to rescind the designation of Plaintiff based upon the
company’s relationship with Andisheh Mehvaran. Dkt. 21-1 at 12–13. The only evidence that
Plaintiff offers in support of that contention, however, is the October 10, 2019 letter in which
OFAC informed Plaintiff that it was (1) rescinding the Andisheh Mehvaran designation, and (2)
re-designating Plaintiff based on its relationship with the IRGC.1 Id. at 6–7, 12–13. In
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In its reply brief, Plaintiff raises for the first time a distinct argument—that OFAC’s initial
designation based on Plaintiff’s relationship to Andisheh Mehvaran and the agency’s second
designation based on Plaintiff’s relationship with IRGC “are both derivative of [Plaintiff’s]
alleged relationship with the IRGC,” and, therefore, documents considered in designating
[Plaintiff] the first time “would be obviously relevant to [Plaintiff’s] re-designation.” Dkt. 23 at
17. The Court need not consider this argument because it was raised for the first time in the
reply brief. United States v. Apodaca, 251 F. Supp. 3d 1, 5 (D.D.C. 2017). But, even had
Plaintiff timely raised the argument, the Court would be unpersuaded because, as Plaintiff
acknowledges, Dkt. 23 at 17–18, the mere fact that certain materials are relevant to a decision
does not mean that they were considered by the agency in rendering its decision. See Cape
Hatteras Access Preservation Alliance v. U.S. Dep’t of Interior, 667 F. Supp. 2d 111, 114
(D.D.C. 2009) (concluding that a report was not “actually before the agency when it made its
current decision” even though that report was “heavily relied upon” in developing other
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Plaintiff’s view, that letter demonstrates that OFAC, in fact, made only one decision—to rescind
and to re-impose the designation—and the administrative record for that one agency action
includes materials relating to (1) the original designation, (2) the reconsideration and
rescindment of that designation, and (3) the imposition of a new designation. Id. at 13. The
Court is unpersuaded.
The October 10, 2019 letter states that OFAC “re-opened its determination” and
initiated a thorough new investigation into Bahman Group and duly considered
all of the information provided by Bahman Group to OFAC, including all of the
information you provided with your request for reconsideration . . . . OFAC’s
reconsideration has resulted in a final agency action based upon a new
administrative record.
Specifically, on October 10, 2019, OFAC rescinded Bahman Group’s
designation [for its support of Andisheh Mehvaran]. Concurrently, OFAC has
re-designated Bahman Group pursuant to E.O. 13224 [for its support of IRGC].
Dkt. 21-4 at 1. Although the letter simultaneously notified Plaintiff of the rescindment of
OFAC’s earlier designation and the agency’s “[c]oncurrent[]” re-designation, id., the letter does
not constitute clear evidence that the materials considered in deciding to rescind the earlier
designation were also considered, either directly or indirectly, in OFAC’s decision to re-
designate Plaintiff based on its financial support for an entirely different entity, the IRGC. To be
sure, there is reason to believe that the two decisions were linked in the sense that OFAC
apparently designated Plaintiff based on its ties to the IRGC only upon concluding that the
agency’s earlier effort to designate Plaintiff based on its ties to Andisheh Mehvaran was flawed.
But that does not mean that OFAC considered records pertaining to the earlier designation in
evaluating whether Plaintiff impermissibly supported the IRGC. At most, it means that OFAC
materials that were before the agency and was referenced by other materials considered by the
agency).
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had no reason to decide whether Plaintiff’s relationship with the IRGC necessitated designation
until after the agency decided to rescind its earlier designation. That sequential relationship,
however, is already evident from the administrative record—the letter itself reflects the
connection. See id. What the letter does not reflect and what Plaintiff has failed to show,
however, is that OFAC considered any of the underlying materials relating to the Andisheh
Mehvaran designation when it made the IRGC designation.
The evidence that OFAC has offered, moreover, supports the agency’s conclusion—
embodied in the designation of the administrative record—that the two agency actions were
distinct and that OFAC did not consider the Andisheh Mehvaran record in its re-designation
investigation or decision. The agency issued separate administrative decisions (1) unblocking
and delisting Plaintiff based on its relationship with Andisheh Mehvaran, Dkt. 22-1 at 2, and (2)
blocking and listing Plaintiff based on its relationship with the IRGC, Dkt. 22-2 at 2–3. The
latter decision recites that Director of OFAC made the determination “in consultation with the
Secretary of State, the Attorney General, and the Secretary of Homeland Security [and] that there
is reason to believe that . . . the attached evidentiary memorandum (SDGT-16714) . . . meets one
or more criteria for designation.” Id. at 2. The unclassified administrative record relating to the
re-designation, moreover, relies on facts unrelated to the agency’s prior designation decision.
See Dkt. 10-3. Although heavily redacted, the supporting memorandum explains that
“[i]nformation presented in [the] memorandum and the accompanying exhibits provides reason
to believe that [Plaintiff] has materially assisted, sponsored, or provided financial, material, or
technological support for, or goods or services to or in support of, the [IRGC], a person whose
property and interests in property are blocked pursuant to E.O. 13224, as amended,” and, in
particular, that “the largest and controlling shareholder of [Plaintiff] is listed as IRGC
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COOPERATIVE FOUNDATION.” Id. at 6, 8. The existing administrative record further
explains:
In 2011 the largest and controlling shareholder of BAHMAN GROUP was
IRGC COOPERATIVE FOUNDATION, which held more than 40% of
BAHMAN GROUP’s shares. In 2011, BAHMAN GROUP shareholders
received payouts (dividends) of 404 Iranian rials per share. OFAC concludes
that based on the shareholder payout of 404 Iranian rials per share and the fact
that IRGC COOPERATIVE FOUNDATION holds over 40% (more than 1.5
billion shares) of BAHMAN GROUP shares, BAHMAN GROUP likely paid
IRGC COOPERATIVE FOUNDATION more than 645 billion Iranian rials in
2011.
As of 2016, the ISLAMIC REVOLUTIONARY GUARD CORPS generated the
equivalent of millions of dollars in profits from its investment in BAHMAN
GROUP.
As of 2016, the ISLAMIC REVOLUTIONARY GUARD CORPS fully[]
controlled and invested in BAHMAN GROUP.
Id. at 84.
The parties disagree about whether the existing factual predicate is sufficient to support
OFAC’s determination. Compare Dkt. 14 to Dkt. 15. For present purposes, however, that is not
the question before the Court. The question, instead, is whether Plaintiff has carried its burden
of showing that, when OFAC rendered its most recent listing determination, it considered any of
the materials Plaintiff seeks to add to the administrative record. The answer to that question is
“no.” Notwithstanding Plaintiff’s contention that “there exists ‘reasonable, non-speculative
grounds [for Plaintiff’s belief] that the documents [at issue] were considered by the agency and
not included in the record,” Dkt. 23 at 15 (quoting Nat’l Mining Ass’n, 856 F. Supp. 2d at 156),
nothing in the existing record, the determination itself, or in Plaintiff’s submissions provides
“concrete evidence that the documents [Plaintiff] seeks to ‘add’ to the record were actually
before the decisionmakers,” Nat’l Mining Ass’n, 856 F. Supp. 2d at 156 (citation omitted).
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Plaintiff argues in the alternative that, if OFAC did not consider the documents at issue
when it rendered its most recent listing determination, the agency’s failure to consider
“information in its possession” was “inappropriate.” Dkt. 21-1 at 17. But, as Plaintiff
acknowledges in its reply brief, see Dkt. 23 at 17–18, arguments regarding what documents an
agency should have considered is not the proper subject for a motion to supplement the record.
Rather, as OFAC acknowledges in its opposition brief, see Dkt. 22 at 14 (quoting Conservation
Force, 2012 WL 11947683, at *5), Plaintiff may eventually argue in its merits brief that the
agency’s failure to consider materials that were in its possession renders the agency’s decision
arbitrary or capricious for purposes of the Administrative Procedure Act, 5 U.S.C. § 706(2)(A).
CONCLUSION
For these reasons, the Court hereby DENIES Plaintiff’s motion to supplement the record,
Dkt. 21.
SO ORDERED.
/s/ Randolph D. Moss
RANDOLPH D. MOSS
United States District Judge
Date: July 29, 2020
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