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United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 22, 2003 Decided June 20, 2003
No. 02-5307
HOLY LAND FOUNDATION FOR RELIEF AND DEVELOPMENT,
APPELLANT
v.
JOHN D. ASHCROFT, IN HIS OFFICIAL CAPACITY AS
ATTORNEY GENERAL OF THE UNITED STATES, ET AL.,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 02cv00442)
John D. Cline argued the cause for appellant. With him on
the briefs was John W. Boyd.
Douglas Letter, Terrorism Litigation Counsel, U.S. Depart-
ment of Justice, argued the cause for appellees. With him on
the brief were Roscoe C. Howard, Jr., U.S. Attorney, H.
Bills of costs must be filed within 14 days after entry of judgment.
The court looks with disfavor upon motions to file bills of costs out
of time.
2
Thomas Byron III, Attorney, U.S. Department of Justice,
and David D. Aufhauser, General Counsel, U.S. Department
of Treasury.
Before: GINSBURG, Chief Judge, and SENTELLE and
HENDERSON, Circuit Judges.
Opinion for the Court filed by Circuit Judge SENTELLE.
SENTELLE, Circuit Judge: In December 2001, the Office of
Foreign Asset Control (‘‘OFAC’’) designated Holy Land
Foundation (‘‘HLF’’) as a ‘‘Specially Designated Global Ter-
rorist’’ (‘‘SDGT’’) pursuant to an Executive Order issued
under the International Emergency Economic Powers Act, 50
U.S.C. § 1701 et seq. (‘‘IEEPA’’). This designation was ac-
companied by an order blocking all of the organization’s
assets. HLF brought an action in the district court challeng-
ing this designation and before us now appeals the lower
court’s decision which affirmed OFAC’s actions and dismissed
the complaint in substantial part. For the reasons explained
below, we hereby affirm the district court’s dismissal in part,
and order summary judgment for the government.
I. Background
The IEEPA, 50 U.S.C. § 1701 et seq., authorizes the Presi-
dent to declare a national emergency when an extraordinary
threat to the United States arises that originates in substan-
tial part in a foreign state. Such a declaration clothes the
President with extensive authority set out in 50 U.S.C.
§ 1702. Under that section he may investigate, regulate, or
prohibit transactions in foreign exchange, banking transfers,
and importation or exportation of currency or securities by
persons or with respect to property, subject to the jurisdic-
tion of the United States. § 1702(a)(1)(A). Of further spe-
cial concern to the Holy Land Foundation, he may
investigate, block during the pendency of an investiga-
tion, regulate, direct and compel, nullify, void, prevent or
prohibit, any acquisition, holding, withholding, use, trans-
fer, withdrawal, transportation, importation or exporta-
tion of, or dealing in, or exercising any right, power, or
3
privilege with respect to, or transactions involving, any
property in which any foreign country or a national
thereof has any interest by any person, or with respect to
any property, subject to the jurisdiction of the United
StatesTTTT
§ 1702(a)(1)(B).
In 1995, the President issued Executive Order 12,947 pur-
suant to the IEEPA. Exec. Order No. 12,947 (60 Fed. Reg.
5079 (Jan. 23, 1995)). That order designated certain terrorist
organizations, including the Palestinian organization Hamas,
as ‘‘Specially Designated Terrorists,’’ or SDTs, and blocked
all of their property and interests in property. The order
also allowed for additional designations if an organization or
person is found to be ‘‘owned or controlled by, or to act for or
on behalf of’’ an SDT. Id.
In 2001, as part of his response to the attacks of September
11, the President issued Executive Order 13,224, similar to
Order 12,947, pursuant to the IEEPA. Exec. Order No.
13,224 (66 Fed. Reg. 49,079 (Sept. 23, 2001)). Order 13,224
designated specified terrorist organizations, again including
Hamas, as ‘‘Specially Designated Global Terrorists,’’ or
SDGTs, and blocked all of their property and interests in
property subject to the jurisdiction of the United States.
That order also allowed for additional SDGTs to be designat-
ed if organizations or persons are found to ‘‘act for or on
behalf of’’ or are ‘‘owned or controlled by’’ designated terror-
ists, or they ‘‘assist in, sponsor, or provide TTT support for,’’
or are ‘‘otherwise associated’’ with them. Id.
HLF was originally established as the Occupied Land Fund
and incorporated as a tax-exempt organization in California in
1989. In 1991 it changed its corporate name to the Holy
Land Foundation for Relief and Development and moved to
Texas. It describes itself as ‘‘the largest Muslim charity in
the United States.’’ In December 2001, OFAC, a division of
the Department of the Treasury, acting pursuant to the
IEEPA and the two Executive Orders (13,224 and 12,947),
designated HLF as both an SDT and an SDGT and blocked
all of its assets. The designations were based on information
4
supporting the proposition that HLF was closely linked to
Hamas. Soon thereafter, HLF filed a complaint in district
court challenging its designations as a terrorist organization
and the seizure of its assets, and alleging that its rights under
the First, Fourth, and Fifth Amendments, its right to free
exercise of religion under the Religious Freedom Restoration
Act, 42 U.S.C. § 2000bb et seq. (‘‘RFRA’’), and its rights
under the Administrative Procedure Act, 5 U.S.C. § 701 et
seq. (‘‘APA’’), had all been violated. HLF also filed a motion
for a preliminary injunction, seeking to enjoin the govern-
ment from blocking or freezing its assets. In support of the
motion, HLF attached exhibits purportedly showing that it
was not linked to Hamas and therefore not a terrorist organi-
zation. Subsequently, in May 2002, the OFAC redesignated
HLF as an SDT and an SDGT, and filed with the district
court an administrative record which included HLF’s motion
for a preliminary injunction with attached exhibits.
In response to HLF’s pleadings, the government moved for
summary judgment on the APA claim and to dismiss the
remaining claims for failure to state a claim. HLF then filed
an opposition to the government’s motion, attaching addition-
al exhibits and seeking discovery. The government moved to
strike all of HLF’s exhibits that were not part of the adminis-
trative record and to bar an evidentiary hearing.
The district court conducted a hearing, consisting entirely
of oral argument by counsel, on the motions. The court then
issued its decision. It granted summary judgment on the
HLF’s APA claim; dismissed, under Rule 12(b)(6), the re-
maining claims except for one aspect of the Fourth Amend-
ment claim; and granted the government’s motion to strike
HLF’s exhibits. Holy Land Found. for Relief & Dev. v.
Ashcroft, 219 F. Supp. 2d 57 (D.D.C. 2002).
II. The District Court’s Opinion
The Holy Land Foundation attempted to supplement the
record before the district court by the addition of exhibits
attached to its opposition to the defendants’ motion to dis-
miss. The government moved in limine to strike the supple-
5
mental material. The district court granted the government’s
motion, holding that APA review ‘‘must ordinarily be confined
to the administrative record.’’ Id. at 65 (citing Camp v. Pitts,
411 U.S. 138, 142 (1973)). The court further rejected HLF’s
argument that the IEEPA authorizes the blocking of proper-
ty only where a foreign country or foreign national has a
legally enforceable interest in that property, by recognizing
that the text of the statute and the cases which have inter-
preted it impose no restraint on the broad phrase ‘‘any
interest’’ and that the Treasury Department’s regular inter-
pretation of that term to mean ‘‘an interest of any nature
whatsoever, direct or indirect’’ had been repeatedly upheld by
the courts. See Holy Land, 219 F. Supp. 2d at 67 (citing
Regan v. Wald, 468 U.S. 222, 224, 225–26, 233–34 (1984)).
The court then commenced a detailed review of the adminis-
trative record and reiterated the evidence on which the
Treasury Department relied in making its determination to
designate HLF as an SDGT. See Holy Land, 219 F. Supp.
2d at 69–75. It found that the record contained ‘‘ample
evidence that (1) HLF has had financial connections to Ha-
mas since its creation in 1989; (2) HLF leaders have been
actively involved in various meetings with Hamas leaders; (3)
HLF funds Hamas-controlled charitable organizations; (4)
HLF provides financial support to the orphans and families of
Hamas martyrs and prisoners; (5) HLF’s Jerusalem office
acted on behalf of Hamas; and (6) FBI informants reliably
reported that HLF funds Hamas.’’ Id. at 69. The court
concluded, based on the substantial evidence in the record,
Treasury’s determination that HLF acts for or on behalf of
Hamas was not arbitrary and capricious, and therefore, up-
held the agency’s reasonable determination.
The court then turned to the remainder of HLF’s claims,
and dismissed all but one under Federal Rule of Civil Proce-
dure 12(b)(6). First, the court rejected HLF’s contention
that its due process rights had been violated because the
government failed to provide notice and a hearing before its
assets were blocked. The court found that postponement of
notice and hearing were justified in this case, under factors
previously articulated by the Supreme Court. See id. at 76–
6
77 (citing Calero-Toledo v. Pearson Yacht Leasing Co., 416
U.S. 663, 679–80 (1974)). The district court also rejected
HLF’s claim under a substantive due process theory, holding
that the designation and blocking were not arbitrary and
capricious and ‘‘did not rise to the level of a constitutional
violation.’’ See id. at 77. The court dismissed HLF’s consti-
tutional claims finding that the designation and blocking
order did not violate the entity’s First Amendment right to
freedom of association, stating that they ‘‘do not prohibit
membership in Hamas or endorsement of its views, and
therefore do not implicate HLF’s associational rights.’’ Id. at
81. Additionally, the court found that HLF’s freedom of
speech First Amendment rights had not been violated be-
cause designation and blocking of funds promote the impor-
tant and substantial governmental interest in combating ter-
rorism by undermining its financial base, and there is no
other, narrower means of ensuring that charitable contribu-
tions to a terrorist organization are used for a legitimate
purpose. See id. at 81–82.
Finally, the district court concluded that HLF lacked the
ability to invoke its own free exercise rights under the
Religious Freedom Restoration Act because it had not alleged
it was a religious organization or that it engaged in an ‘‘actual
exercise of religion’’ as an organization. Id. at 83. Likewise,
the court held that HLF lacked standing to invoke the free
exercise rights of third parties, such as its donors and em-
ployees. See id. at 83–84. The court denied the requested
preliminary injunction because HLF had failed to demon-
strate a substantial likelihood of success on the merits and
because injury to the government and the public interest
supported the executive’s use of designation and blocking as a
means to advance the government’s foreign policy and nation-
al security. Id. at 84.
III. Analysis
We review the district court’s dismissal for failure to state
a claim under Rule 12(b)(6) de novo. See Browning v.
Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002). Additionally, the
7
actions of the Treasury Department in designating HLF as a
SDGT are governed by the judicial review provisions of the
APA, 5 U.S.C. § 706(2)(A). Therefore, if the OFAC’s actions
were not arbitrary and capricious, and were based on sub-
stantial evidence, we must affirm.
As a first matter, we reject HLF’s claim that its designa-
tion exceeded Treasury’s authority under the APA, and af-
firm the district court’s dismissal of that claim. The district
court correctly reviewed the actions of the Treasury Depart-
ment under the highly deferential ‘‘arbitrary and capricious’’
standard. See Citizens to Preserve Overton Park, Inc. v.
Volpe, 401 U.S. 402, 416 (1971). The district court noted that
this standard does not allow the courts to undertake their
own factfinding, but to review the agency record to determine
whether the agency’s decision was supported by a rational
basis. See Holy Land, 219 F. Supp. 2d at 67 (citing Camp,
411 U.S. at 142).
As demonstrated by the district court’s survey in the
opinion below, Treasury’s decision to designate HLF as an
SDGT was based on ample evidence in a massive administra-
tive record. HLF attacks the reasonableness of this determi-
nation by contending that Treasury relied on hearsay evi-
dence to reach its conclusion. This argument is unavailing as
it is clear that the government may decide to designate an
entity based on a broad range of evidence, including intelli-
gence data and hearsay declarations. See National Council
of Resistance v. Dep’t of State, 251 F.3d 192, 196 (D.C. Cir.
2001) (‘‘NCOR’’). HLF also argues that Treasury was arbi-
trary and capricious in relying on information that predated
the 1995 designation of Hamas as a terrorist organization.
However, as the district court noted, it was clearly rational
for Treasury to consider HLF’s genesis and history, which
closely connect it with Hamas. See Holy Land, 219 F. Supp.
2d at 74. There was no plausible evidence presented which
showed that these ties had been severed. The HLF officers
and directors who dealt with Hamas until 1995 remained with
HLF in their respective capacities until HLF itself was
designated. See id. There was ample record evidence, in
any case, that HLF continued beyond 1995 to maintain its
8
ties with Hamas and continued to give money to entities
controlled by and associated with Hamas. This evidence
included the testimony of numerous FBI sources and findings
by both Israeli and Palestinian governmental authorities.
Finally, the district court correctly rejected HLF’s argu-
ment that the IEEPA permits blocking of property only
where there is a ‘‘legally enforceable’’ interest to be blocked.
See Holy Land, 219 F. Supp. 2d at 67. The plain text of the
statute belies HLF’s contention because it authorizes the
blocking of property in which the designated foreign national
or country has ‘‘any interest.’’ 50 U.S.C. § 1702(a)(1)(B).
The language therefore imposes no limit on the scope of the
interest, and OFAC has defined this statutory term, pursuant
to explicit authorization from Congress, 50 U.S.C. § 1704, to
mean, ‘‘an interest of any nature whatsoever, direct or indi-
rect.’’ 31 C.F.R. § 500.311–.312. We have upheld Treasury’s
authority to define these interests. See Consarc Corp. v.
Iraqi Ministry, 27 F.3d 695, 701 (D.C. Cir. 1994) (Treasury
‘‘may choose and apply its own definition of property inter-
ests, subject to deferential judicial review.’’). The Seventh
Circuit eloquently dealt with the applicability of the IEEPA
to more than traditional ‘‘legal interests’’ in Global Relief
Foundation, Inc. v. O’Neal, 315 F.3d 748 (7th Cir. 2002). In
that case, the Global Relief Foundation, like the HLF in the
present case, argued that the word ‘‘interest’’ in
§ 1702(a)(1)(B) ‘‘refer[red] to a legal interest, in the way that
a trustee is legal owner of the corpus even if someone else
enjoys the beneficial interest.’’ Id. at 753 (emphasis in origi-
nal). The Global Relief Foundation court rejected that con-
struction as do we, reasoning that ‘‘[t]he statute is designed to
give the President means to control assets that could be used
by enemy aliens.’’ Id. That risk is at least as much raised
by the prospect of the foreign terrorists holding the beneficial
interest, or an interest not defined in traditional common law
terms as it is by a legal interest which might be a pure fiction.
We find the reasoning of the Seventh Circuit unassailable and
join it. The interest need not be a legally protected one in
order to be caught within the net of § 1702. In this case,
there was ample evidence of foreign ‘‘interests’’ in HLF’s
9
assets. There was evidence demonstrating that HLF operat-
ed as a fundraiser for Hamas in the United States and that
Hamas officials provided HLF with funds. Therefore, OFAC
did not exceed its authority when it blocked the assets after
the designation, because OFAC needed only to determine
that Hamas had an interest in HLF’s property, and the
record provided substantial evidence to support that conclu-
sion.
The district court also properly disposed of HLF’s due
process claims under Rule 12(b)(6). First, OFAC’s designa-
tion of HLF as an SDGT was not arbitrary and capricious, as
demonstrated above. See Holy Land, 219 F. Supp. 2d at 77.
Nor was the designation in any other way so egregiously
unfair as to violate any constraints due process may place
upon the substance of the agency’s decision. Additionally,
HLF was accorded all the administrative process it was due
when it was redesignated as an SDGT. Even if Treasury’s
initial designation arguably violated HLF’s due process
rights, HLF’s funds are blocked currently by a redesignation
which Treasury applied in accordance with the requirements
we outlined in NCOR, 251 F.3d 192.
In NCOR, we considered a due process challenge to the
Secretary of State’s designation of two foreign entities as
foreign terrorist organizations under 8 U.S.C. § 1189. A
designation under that statute carries a similar implication to
those under the Executive Order at issue in this case. In the
record before us in NCOR, the Secretary of State had
afforded the entities neither a predesignation notice nor an
opportunity to comment on the evidence against them. We
held that the Constitution requires that the Secretary, in
designating organizations as foreign terrorist organizations
under that statute, must ‘‘afford to the entities under consid-
eration [for designation] notice that the designation is im-
pending,’’ except that ‘‘[u]pon an adequate showing to the
court, the Secretary may provide this notice after the desig-
nation where earlier notification would impinge upon the
security and other foreign policy goals of the United States.’’
NCOR, 251 F.3d at 208. Additionally, the Secretary must
‘‘afford to entities considered for imminent designation the
10
opportunity to present, at least in written form, such evidence
as those entities may be able to produce to rebut the adminis-
trative record or otherwise negate the proposition that they
are foreign terrorist organizations.’’ Id. at 209.
In the present case, HLF was initially designated in 2001,
in an action taken under the IEEPA-based sanctions pro-
gram, flowing from a presidentially declared national emer-
gency, as recognized by the district court. See Holy Land,
219 F. Supp. 2d at 76–77. However, in April, 2002, Treasury
notified both Holy Land and the district court that it was
reopening the administrative record and considering whether
to redesignate HLF as an SDGT, on the basis of additional
evidence linking HLF and Hamas. Holy Land was then
given thirty-one days to respond to the redesignation and the
new evidence. Holy Land did respond and the Treasury
considered its response as well as the new evidence before
deciding to redesignate HLF in May 2002. Therefore, Trea-
sury provided HLF with the requisite notice and opportunity
for response necessary to satisfy due process requirements.
As we stated in NCOR, we do not require an agency to
provide procedures which approximate a judicial trial, 251
F.3d at 209; therefore, HLF has no right to confront and
cross-examine witnesses. Additionally, the notice ‘‘need not
disclose the classified information to be presented in camera
and ex parte to the court under the statute. This is within
the privilege and the prerogative of the executive, and we do
not intend to compel a breach in the security which that
branch is charged to protect.’’ Id. at 208–09. The IEEPA
expressly authorizes ex parte and in camera review of classi-
fied information in ‘‘any judicial review of a determination
made under this section [that] was based on classified infor-
mation.’’ 50 U.S.C. § 1702(c).
We have had recent occasion to consider a claim that the
use of classified information disclosed only to the court ex
parte and in camera in the designation of a foreign terrorist
organization under the AEDPA was violative of due process.
In rejecting that claim, we recalled that ‘‘[t]he due process
clause requires only that process which is due under the
circumstances of the case.’’ People’s Mojahedin Organiza-
11
tion of Iran v. Dep’t of State, F.3d (D. C. Cir. May 9,
2003) (slip op. at 8) (citing Morrissey v. Brewer, 408 U.S. 471,
481 (1972)). We further held that the standard set forth in
NCOR applies not only to the notice provisions governing
classification but to the full process of classification and that
therefore ‘‘due process required the disclosure of only the
unclassified portions of the administrative record.’’ Id. at 7
(emphasis in original). Again, we emphasized the primacy of
the Executive in controlling and exercising responsibility over
access to classified information, and the Executive’s ‘‘ ‘compel-
ling interest’ in withholding national security information
from unauthorized persons in the course of executive busi-
ness.’’ Id. at 7–8 (citations omitted). That the designation
comes under an Executive Order issued under a different
statutory scheme makes no difference. HLF’s complaint, like
that of the Designated Foreign Terrorists Organizations in
the earlier cases, that due process prevents its designation
based upon classified information to which it has not had
access is of no avail.
HLF argues that the government violated its First Amend-
ment rights of freedom of association and freedom of speech
and its right to equal protection under the Fourteenth
Amendment. HLF argued below that the government had
violated its First Amendment rights by prohibiting it from
making any humanitarian contributions by blocking its assets.
See, e.g., FEC v. Colorado Republican Federal Campaign
Committee, 533 U.S. 431, 440 (2001) (contributions of money
fall within the First Amendment’s protection of speech and
political association). The district court dismissed these
claims pursuant to Rule 12(b)(6), ruling that HLF failed to
state a claim because ‘‘there is no constitutional right to
facilitate terrorism.’’ Holy Land, 219 F. Supp. 2d at 81
(quoting Humanitarian Law Project v. Reno, 205 F.3d 1130,
1133 (9th Cir. 2000)). HLF argues before us now that the
district court erred in its disposition of these claims because
the court should not have considered evidence beyond those
allegations contained in the complaint in order to reach its
conclusion and a necessary element in the court’s reasoning
on all three claims was that the HLF did support Hamas.
12
On review of a 12(b)(6) motion a court ‘‘must treat the
complaint’s factual allegations as true TTT and must grant
plaintiff the benefit of all inferences that can be derived from
the facts alleged.’’ Sparrow v. United Air Lines, Inc., 216
F.3d 1111, 1113 (D.C. Cir. 2000) (internal quotation omitted).
Additionally, the liberal federal pleading standard requires
that complaints need only contain ‘‘a short and plain state-
ment of the claim showing that the pleader is entitled to
relief.’’ FED. R. CIV. P. 8(a)(2); see also Browning, 292 F.3d
at 242. The amended complaint submitted by HLF on which
the claims should have been considered, alleged that HLF
had no knowing affiliation with Hamas or any other terrorist
organization. In order to reach the outcome it did, that there
is no constitutional right to fund terrorism, the district court
first had to find that the HLF funds terrorism.
We agree with HLF that the district court could not have
reached its conclusion without either improperly applying a
heightened pleading standard or extending the scope of the
12(b)(6) review. As HLF reminds us, if in considering a
motion to dismiss under Rule 12(b)(6) for failure of the
complaint to state a claim for relief, ‘‘matters outside the
pleading are presented to and not excluded by the court, the
motion shall be treated as one for summary judgment and
disposed of as provided in Rule 56, and all parties shall be
given reasonable opportunity to present all material made
pertinent to such a motion by Rule 56.’’ FED. R. CIV. P.
12(b). HLF argues that that is just what the court did in this
case but without converting the proceeding to a Rule 56
proceeding and permitting HLF to either conduct discovery
or come forward with additional evidence. It appears that
HLF is correct. The district court apparently did consider
the administrative record before it, but did not provide the
opportunities for the presentation of additional material con-
templated by Rule 12(b). This failure to comply with the
procedures set forth in the Federal Rules of Civil Procedure
constituted an abuse of discretion. Nonetheless, we find this
error to be harmless, as HLF suffered no prejudice as a
result. See 28 U.S.C. § 2111.
13
HLF could have suffered prejudice only if the failure of the
court to convert the proceeding prevented it from coming
forward with evidence sufficient to create a substantial ques-
tion of fact material to the governing issues of the case.
Specifically, could HLF have produced evidence upon which a
reasonable trier of fact could have found that the designation
and the blocking of assets violated its First or Fifth Amend-
ment rights? See Anderson v. Liberty Lobby, 477 U.S. 242,
248 (1986). In this case, it could not have. As set forth in
other portions of this opinion, the law is established that
there is no constitutional right to fund terrorism. The ample
record evidence (particularly taking into account the classified
information presented to the court in camera) establishing
HLF’s role in the funding of Hamas and of its terrorist
activities is incontrovertible. While not in accordance with
proper procedures, HLF has had every opportunity to come
forward with some showing that that evidence is false or even
that its ties to Hamas had been severed. HLF’s presenta-
tions at the administrative stage did not reach this goal, even
when HLF was given an additional thirty-one days to respond
to its redesignation and to the new evidence in April of 2002.
Even following the district court’s judgment, while HLF
attempted to supplement the record on appeal, the supple-
mentary material could not have defeated the proposition
established by the record evidence that Holy Land was a
funder of the terrorist organization Hamas. Perhaps the
supplemental evidence offered, while properly rejected from
the administrative review claim should have been admitted
for the unannounced summary judgment proceeding we now
review. But it would have made no difference.
We do not propose that in every case in which a district
court improperly goes beyond the pleadings in granting a
motion to dismiss without affording the protections contem-
plated in Rule 12(b), a losing party will lose once more on
appeal because of its inability to show what it would have
produced had it been given the opportunity. In a general
case, perhaps the opportunity for discovery might have pro-
duced precisely that which was lacking. However, this is not
a general case. This is a specific case involving sensitive
14
issues of national security and foreign policy. In addition to
the classified evidence that we have reviewed, all evidence
from the government that is unclassified and otherwise dis-
coverable is in the record before us, as is the evidence HLF
produced in an effort to create a genuine factual dispute.
Despite the district court’s failure to follow the proper proce-
dures, HLF had every opportunity and incentive to produce
the evidence sufficient to rebut the ample evidence supporting
the necessary conclusion that it was a funder of Hamas but
could not do so. Thus, we review an adequate record and
conclude that while the district court’s conclusion may have
been based upon improper procedure, there is no substantial
question as to the material facts necessary to support the
district court’s judgment. Again, we hold as other courts
have that there is no First Amendment right nor any other
constitutional right to support terrorists, and that the record
supports no conclusion that the designation or blocking violat-
ed any constitutional right of the HLF. See, e.g., Humani-
tarian Law Project, 205 F.3d at 1133.
IV. The RFRA Claim
Similar reasoning supports a grant of summary judgment
for the government on HLF’s claim that the designation and
blocking order substantially burden its exercise of religion in
violation of the Religious Freedom Restoration Act
(‘‘RFRA’’), 42 U.S.C. § 2000bb–1. RFRA bars the govern-
ment from placing a ‘‘substantial[ ] burden’’ on a person’s
exercise of religion ‘‘even if the burden results from a rule of
general applicability,’’ unless the government demonstrates a
‘‘compelling governmental interest,’’ and uses the ‘‘least re-
strictive means’’ of furthering that interest. 42 U.S.C.
§ 2000bb–1(a), (b). Congress enacted RFRA in 1993 in
response to the Supreme Court’s decision in Employment
Division, Dep’t of Human Resources of Oregon v. Smith, 494
U.S. 872 (1990). The Smith decision had held that ‘‘neutral,
generally applicable laws may be applied to religious prac-
tices even when not supported by a compelling government
interest.’’ City of Boerne v. Flores, 521 U.S. 507, 514 (1997).
In passing RFRA, Congress expressed its purpose as being
15
‘‘to restore the compelling interest test as set forth in Sher-
bert v. Verner, 374 U.S. 398 (1963), and Wisconsin v. Yoder,
406 U.S. 205 (1972), and to guarantee its application in all
cases where free exercise of religion is substantially bur-
dened.’’ 42 U.S.C. § 2000bb.
Although the City of Boerne case held the RFRA unconsti-
tutional as applied to state government action, we have held
that without doubt ‘‘the portion [of RFRA] applicable to the
federal government TTT survived the Supreme Court’s deci-
sion striking down the statute as applied to the States.’’
Henderson v. Kennedy, 265 F.3d 1072, 1073 (D.C. Cir. 2001).
That the statute constitutionally applies against the federal
government, however, only raises the question: does the
present designation with its consequences substantially bur-
den the exercise of religion on the facts before the district
court and now before this court? Like the district court, we
conclude that it does not.
The district court held that the Foundation could not state
a viable RFRA claim on its own behalf because it had
‘‘define[d] itself as a ‘non-profit charitable corporation’ with-
out any reference to its religious character or purpose.’’
Holy Land, 219 F. Supp. 2d at 83. Effectively then, the court
held that such a corporation is not ‘‘a person’’ within the
meaning of 42 U.S.C. § 2000bb-1(c), which provides judicial
relief to ‘‘a person whose religious exercise has been bur-
dened in violation’’ of RFRA. That may be, but we do not so
decide today. We decide only that even if it is such a person,
its religious exercise has not been burdened in violation of the
statute. Congress in enacting RFRA only sought to provide
process and standards for the protection of religious exercise.
It did not purport to extend the definition of that term, and
indeed defined the term ‘‘exercise of religion’’ only as mean-
ing ‘‘the exercise of religion under the First Amendment to
the Constitution.’’ 42 U.S.C. § 2000bb–2(4). Even accepting
the dubious proposition that a charitable corporation not
otherwise defined can exercise religion as protected in the
First Amendment, preventing such a corporation from aiding
terrorists does not violate any right contemplated in the
Constitution or the RFRA. No one on behalf of Holy Land
16
Foundation has forwarded the proposition that the fomenting
and spread of terrorism is mandated by the religion of Islam.
At most they argue a right to charitable giving as a pillar of
that religion. Cf. Henderson v. Kennedy, 253 F.3d 12, 17
(D.C. Cir. 2001) (holding that a general religious mandate ‘‘to
spread the gospel by ‘all available means’ ’’ does not provide
RFRA protection to the sale of T-shirts). Acting against the
funding of terrorism does not violate the free exercise rights
protected by RFRA and the First Amendment. There is no
free exercise right to fund terrorists. The record clearly
supports a conclusion that HLF did. There is no evidence
that Congress intended to create such a right within the
RFRA. Therefore, HLF’s activities do not fall within the
RFRA’s protection, and based on the evidence already in the
record, summary judgment for the government is warranted.
V. Conclusion
Therefore, we uphold the district court’s affirmance of the
Treasury Department’s decision to designate HLF as an
SDGT and to block its assets. We also affirm the district
court’s dismissal of HLF’s due process claims. Although we
hold that the district court erred in not converting the
government’s 12(b)(6) motion for dismissal to a motion for
summary judgment, we find that error to be harmless be-
cause the government should have been granted summary
judgment, as we hereby do, on the basis of the administrative
record.