Massoud Bassidji v. Simon Soul Sun Goe

Executive Order 13,059 (the “Executive Order” or “Order”), 62 Fed.Reg. 44,531 (Aug. 21, 1997), prohibits United States citizens from investing in and trading with Iran. The question we face is whether an American citizen’s guarantees of payments that furthered a trade agreement with an Iranian company are covered by the Executive Order and, if so, whether the guarantees are unenforceable as a result. We conclude that the guarantees were illegal under the Executive Order and, under the circumstances of this case, unenforceable.

BACKGROUND

The First Amended Complaint

This appeal arises from the district court’s denial of the defendant’s motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). We therefore assume true the following facts, alleged in the First Amended Complaint. See Libas Ltd. v. Carillo, 329 F.3d 1128, 1130 (9th Cir.2003).

“In or around” November 1999, an Iranian company, Seyd Sayyad Ltd. (“SSL”), and a Hong Kong company, Kingdom Enterprises Ltd. (“KEL”), entered into a business arrangement for the purpose of harvesting Artemia cysts (brine shrimp eggs) from a lake in Iran. The Iranian government required sizeable payments for licenses and other…