Englehardt v. Blanche

Case Overview

On appeal from the U.S. District Court for the District of Columbia (No. 1:24-cv-01865), the D.C. Circuit held that the Department of Justice misallocated the proceeds of a major criminal enforcement action and must deposit them into the United States Victims of State Sponsored Terrorism Fund. In April 2023, British American Tobacco agreed to pay more than $629 million in criminal penalties and forfeitures for two conspiracies involving illicit business with North Korean entities: an IEEPA sanctions-evasion conspiracy and a bank-fraud conspiracy. The Justice Department allocated only a fraction of those proceeds to the Fund, which compensates victims of state-sponsored terrorism who hold judgments under the Foreign Sovereign Immunities Act's terrorism exception. Two claimants against the Fund, Joseph Paul Englehardt and Yvonne Dora Wade, sued, arguing that all of the proceeds belonged in the Fund; the district court granted summary judgment for the Department. In an opinion by Circuit Judge Neomi Rao, joined by Circuit Judge Justin Walker and Senior Circuit Judge Judith Rogers, decided August 4, 2026, the D.C. Circuit reversed, holding that the Justice for United States Victims of State Sponsored Terrorism Act (34 U.S.C. Sec. 20144(e)(2)(A)(i)) requires these criminal proceeds to be deposited into the Fund, and remanded with instructions to enter summary judgment for the plaintiffs. Argued November 4, 2025.