The opinion of the court was delivered by: PLATT
Defendants have moved to dismiss the plaintiffs' complaint pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure on the grounds (i) that this Court lacks jurisdiction over the subject matter, or, in the alternative, pursuant to Rule 12(b)(6) on the grounds (ii) that the complaint fails to state a claim upon which relief can be granted. Plaintiffs have made a cross motion for summary judgment pursuant to Rule 56 on the ground that plaintiffs are entitled to a judgment as a matter of law.
The following facts have been admitted by the parties for the purposes of these motions:
Carl W. Stuetzel died intestate in Havana, Cuba, on August 24, 1965. Stuetzel's only heir-at-law, his wife Concepcion Brodermann Stuetzel, entered the United States as a permanent resident on October 13, 1969. Shortly thereafter, she applied for a license seeking release of certain assets held in a joint bank account in the Bank of Nova Scotia which had been frozen by the Secretary of the Treasury pursuant to the Trading with the Enemy Act
and the Regulations promulgated thereunder.
On December 12, 1969, a license was issued by the Secretary releasing fifty-percent of the blocked assets to Mrs. Stuetzel. The remaining fifty-percent, consisting of cash in the approximate sum of $12,873 and 770 shares of Exxon Corporation stock, was retained in a blocked account at the Bank of Nova Scotia.
Mrs. Stuetzel died on October 31, 1971. Her will devised the blocked assets to Elena Richardson, a niece of Mrs. Stuetzel and a citizen and resident of the United States. The plaintiffs, also citizens and residents of the United States, were named as executors of the decedent's estate.
On June 30, 1972, the plaintiffs applied to the Secretary for a license unblocking the remaining fifty-percent of the assets. This application was denied.
On March 19, 1976, the plaintiffs filed the complaint herein alleging that the refusal to release the assets constitutes a deprivation of property without due process of law, and that such refusal exceeds the authority granted by the statute, 50 U.S.C. App. § 5.
The constitutionality of the Trading with the Enemy Act and the Regulations promulgated thereunder is well established in this Circuit. Sardino v. Federal Reserve Bank of New York, 361 F.2d 106 (2d Cir.), cert. denied, 385 U.S. 898, 17 L. Ed. 2d 130, 87 S. Ct. 203 (1966);
Teague v. Regional Commissioner of Customs, 404 F.2d 441 (2d Cir. 1968), cert. denied, 394 U.S. 977, 22 L. Ed. 2d 756, 89 S. Ct. 1457, rehearing denied, 395 U.S. 930, 23 L. Ed. 2d 251, 89 S. Ct. 1768 (1969). These cases are dispositive of plaintiffs' first argument.
Plaintiffs further argue that the Regulations are inconsistent with the Trading with the Enemy Act and that there is no foreign interest that can be frozen by the Treasury Department. They contend that this case should be decided in accordance with a recent Fifth Circuit decision, Real v. Simon, 510 F.2d 557 (5th Cir. 1975), rehearing denied, 514 F.2d 738. They argue, as the plaintiffs did in Real, that the Regulations are invalid as applied.
Defendants, on the other hand, contend that the Cuban Assets Control Regulations validly prohibit, unless licensed, the transfer of the estate of a deceased Cuban national, blocked prior to his death, even though the claimants are residents or citizens of the United States, and that pursuant to these Regulations this Court lacks jurisdiction to order a transfer of blocked property in the absence of a ...