D.C. Circuit Affirms Wynn Ruling

Late last week, a D.C. Circuit Court panel affirmed a prior District Court dismissal of a civil suit brought in 2021 by the Department of Justice that had sought to compel casino magnate Steve Wynn to register retroactively as a FARA “agent” for the People’s Republic of China.  Wynn had allegedly contacted Trump Administration officials at the PRC’s behest in connection with the potential extradition of a Chinese dissident in 2017, but he had ceased all activity years prior to the lawsuit’s initiation.  Based on past precedent interpreting an ambiguous statutory provision, the District Court concluded that the Department could not seek to compel Wynn to register retroactively through a civil lawsuit after his alleged agency relationship with the PRC had already ended.  The D.C. Circuit panel agreed with the District Court that because “Wynn long ago ceased acting as a foreign agent, he has no present obligation to register.”

The Department might as well appeal the decision to the full D.C. Circuit.  Assuming the Wynn ruling stands, though, here are a few thoughts to consider moving forward:

  • The effect of this decision is technically limited to the jurisdiction of the D.C. Circuit, which leaves the Department potentially free to seek retroactive registrations from those located outside of that geographic area. But the D.C. Circuit’s skepticism of the government’s arguments during the Wynn case could curb the Department’s appetite for doing so.
  • Wynn relates to an enforcement tool that the Department has found useful only twice in the past three decades, so this decision may not have much of an impact on overall FARA enforcement.
  • Wynn never addressed whether Wynn could be considered an “agent” under the facts alleged, which means that any takeaways here are procedural rather than substantive.
  • Because Wynn stands for the proposition that the obligation to register as a FARA “agent” ends with the termination of a relationship with a foreign principal, it will be reasonable in the future for an individual or organization to respond to a Letter of Inquiry from the Department by stopping all work for a foreign principal. Such action should be weighed carefully with the assistance of counsel, since it could in circumstances involving borderline “willful” conduct motivate the Department to seek criminal enforcement, which is unaffected by Wynn

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