If I were GMing this, I'd give a big difficulty modifier to your argument! The basic problem is that under the logic of communal liability, it doesn't matter that Killer-Varanil is outlawed or dead (same thing really). Your clan "owes" the Grey Dogs because of the actions of someone who was a member of your clan at the time.
BTW, this is yet another reason why Full Outlawry is so rare - clans have a strong incentive to patrol the behavior of their members.
Jeff
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