Petition for Writ of Certiorari — Alberto Rodriguez v. Department of Justice
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Court, U.S.
Supreme
FILED
0110183 oc -3 2001
No. OPFIGE OF THE GueHtiK
_ ss
IN THE
Supreme Court of the United States
OCTOBER TERM, 2001
LUIS ALBERTO RODRIGUEZ,
Petitioner,
UNITED STATES DEPARTMENT OF JUSTICE and
DRUG ENFORCEMENT ADMINISTRATION,
Respondents.
ON PETITION FOR A WRIT OF CERTIORARI
TO THE S**2OND CIRCUIT COURT OF APPEALS
PETITION FOR A WRIT OF
CERTIORARI
CARL R. SOLLER
. Counsel of Record
CLARENCE J. ERICKSON
HODGSON RUSS LLP
Attorneys for Petitioner
Luis Alberto Rodriguez
152 West 57th Street
New York, New York 10019
212-751-4300
QUESTIONS PRESENTED
1. Whether the Court of Appeals erred in failing to follow a
Tenth (10th) Circuit decision.
(a) The Court of Appeals for the Second Circuit has
entered a decision in conflict with the decision of
another, as to call for an exercise of this Court’s
supervisory power,
(b) A United States Court of Appeals has decided an
important question of federal law that has not been,
but should be, settled by this Court.
2. Whether the Court of Appeals erred in affirming a dismissal
of Luis Rodriguez’s Motion for Return of Property and allowing
the government to forfeit approximately $366,000.00 in U.S.
currency by default and without a hearing on the merits.
3. Whether the Court of Appeals erred in determining that Luis
Rodriguez had an adequate remedy at law to contest the seizure
of his currency; Whether the Court of Appeals erred in
determining that in a judicial forfeiture proceeding, a claimant
can challenge the legality of a seizure.
4. Whether the Court of Appeals erred in affirming a forfeiture
of approximately $366,000.00 in U.S. currency, an amount far
in excess in proportion to the procedural defect the court allege
to have occurred.
TABLE OF CONTENTS
Page
Questions PEG Wes deans o 044s Cece cenesws i
MME vn ca ccaccécccscentecseceveceeeves li
Table of Cited Authorities ..........cceccccecececece Vv
TOs OF AMORUIONS oo ii is civ cee reece ceceecwees ix
Opinions Below ..........cccccccceccceccccececees 1
MeMNeOEE OE FUTICTION ono occ cc ccceseveccessveses 1
Statutory And Constitutional Provisions Involved ....... 2
Statement of the Case........ Sobek CbVideaveecevass 2
Se, Cla see ewe eh seeeeeseeneses 2
B. The Administrative Proceedings ............ 4
Reasons for Granting the Writ ............--0-e- eee 6
I. The Second Circuit Has Entered a Decision
in Conflict With The Decision of the Tenth
(10th) Circuit, As To Call For An Exercise
Of This Court’s Supervisory Power.......... 6
IL. The Second Circuit Has Decided An Important
Question Of Federal Law That Has Not Been,
But Should Be, Settled By This Court ........ 9
Ill. The Court of Appeals Erred In Determining
That Luis Rodriguez Had An Adequate
Remedy At Law To Contest The Seizure Of
His Currency; The Court Of Appeals Erred
In Determining That In A Judicial Forfeiture
Proceeding A Claimant Can Challenge The
Legatsty OT A SEMIS 20. cccccvcsccsvcss 10
A. The Courts Should Have Heard the 41(e)
Motion Under Its Equity Jurisdiction -
Rule 41(e) Affords the Only Remedy for the
Illegal Seizure in this Case ............. 11
B. The Remedies Offered to Rodriguez
ED o's vce os nce d saeseuees 18
C. The Claim and Bond Are Not An Exclusive
Remedy; The Administrative Process, ipso
facto, Does Not Remove this Case From the
District Court’s Jurisdiction ............ 21
D. Without Invoking its Equitable Jurisdiction,
the Court Should Have Treated The 41(e)
Motion as (a) a Motion Seeking Mandamus
Compelling the Initiation of a Judicial
Forfeiture Action; (b) a Motion for a Stay of
Administrative Forfeiture Pending the Filing
of a Claim and Bond; or (c) Any Other
Remedy Which the Court Could Have
Deemed Appropriate in Order to Afford
Rodriguez a Judicial Hearing on the
Merits of the Seizure .... 2. cc ccccccces 22
-iv-
IV. Forfeiture Is Too Drastic In This Case....... 23
A. The Amount of Money Seized is Too Great a
Penalty for an Alleged Procedural Defect . 23
B. The Legal Climate Concerning
Civil Asset Forfeitures ........... teven ae
CONCLUSION cccccccccccccccccesesvecesvevcees 26
TABLE OF CITED AUTHORITIES
Page
United States Supreme Court
iav
477 US. 21, 106 S. Ct. 2379 (1986) .......- 13, 14
Vv
461 U.S. 555, 103 S.Ct. 2005,
16 L.Ed.2d 143 (1983) .......---0005- 6, 7, 11, 20
v. Baj
524 U.S. 321, 118 S. Ct. 2028,
1998 U.S. LEXIS 4172; 141 L. Ed. 2d 314
(Decided June 22, 1998) ......-.--+-+- 10, 23, 24
Courts of Appeals
47 Vv
901 F.2d 1540 (11 Cir. 1990).......------ eee 7
Floyd v. United States, 860 F.2d 999 (10th Cir 1988) ..... 7
Hunsucker v. Phinney, 497 F.2d 29 (Sth Cir. 1974) ..... 12
897 F.2d 1549 (10th Cir. 1990) ........-..---- 13
Vv
92 F.3d 648 (8th Cir 1996) .......----------:- 6
-vi-
Onwubiko v. United
969 F.2d 1392 (2d Cir. 1992)............. 8,9, 22
Richey v. Smith, 515 F.2d 1239, 1245 (Sth Cir. 1975) ... 12
Shaw v. United States, 891 F.2d 602 (6th Cir. Seto 7
Toure v. United States, 24 F.3d 444 (2d Cir | ere 8
United States v. Martinson, 809 F.2d 1364 (9th Cir. 1987) 14
897 F.2d 1457, 1462 (8th Cir. 1990) ........... 18
ni Vv. ?
725 F.2d 1007, 1011 (Sth Cir. 1984) ........... 18
ni Vv. 7 W. Auto.
972 F.2d 472, 480 (2d Cir 1992) ........ 7, 8, 9, 20
United States v. Rapp, 539 F.2d 1156 (8 Cir. | ae 13
787 F.2d 1089 (7th Cir. 1985) ..... cece ee eeeee 21
District Court
Boyd v. U.S. Dept. of Justice,
673 F.Supp. 660 (E.D.N.Y. 1987) ............. 14
Camacho v. United States,
645 F.Supp 725 (E.D.N.Y. 1986)
COUR AE) 6665 Ss eS. 8, 10
No. 95-CV-0302 (RSP/GJD),
1995 WL 494002 (N.D.N.Y. Aug. 16, 1995) ....
In re First United Financial Corp..,
620 F.S ail p. 1450 (E.D.N.Y. 1985) .........
715 F.Supp 423 (D.R.L 1989) .........----
Roberts v. United States,
656 F.Supp. 929 (S.D.N.Y. 1987),
reversed on other grounds,
852 F.2d 671 (2d Cir. 1988),
cert. denied 488 U.S. 993 (1988) ...........
rling Vv it tates,
749 F.Supp 1202 (E.D.N.Y. 1990) .........
United States v. An Antique Platter of Gold,
95 MAG 2167 (NRB), 1995 WL 758762
(S.D.N.Y. Dec. 22,1995) ww ee ee eee eee
nit Vv. 1 en
4
719 F.Supp. 595 (E.D.Mich. 1989) ......-
Vv Ww helle, New_York,
120 F.R.D. 465 (S.D.N.Y. 1988) —.....-.
Statutes
Oe i on cco pacecaccucses
PE EE nap dvabavedunesaevcenetoneecioks 21
Fe in OS OOOE ec wccdokaivledtsccivdekineiveseis 18
Fe se PED i oticed cdaedisapedencieatn 24
Other Authorities
Customs Systems and Infrastructure Overview .......... 4
H.R. 1658, with Accompanying House Report
106-192, representing the Civil Asset
PID HIND 06 p's dea wsssveees cs 25
June 11, 1997 Judiciary Committee Meeting for the
Civil Asset Forfeiture Reform Act (H.R. 1658)... 15
Rules
Pe ae, Gs Fo Oe vcctcanedbinesdedadewsa passim
Ph ee se I so bs vavvanwenecddeeunes 13, 14
Regulations
SOG Pe 6.20 dadbsnncdatisiwens ete 5, 19
Constitutional Provisions
cin Manns NG ac 12
Si GEE MIE, FEN odo dee bd oeadadbdetecsncue 24
LE I
APPENDIX A
MEMORANDUM AND ORDER OF THE
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NEW YORK,
DATED AND FILED AUGUST 12, 1999 ............
APPENDIX B
JUDGMENT OF THE
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NEW YORK,
DATED AND FILED AUGUST 13, 1999 ...........
APPENDIX C
ORDER OF THE UNITED STATES
COURT OF APPEALS FOR THE SECOND CIRCUIT,
DATED AND DECIDED FEBRUARY 22, 2001 ......
APPENDIX D
ORDER OF THE UNITED STATES
COURT OF APPEALS FOR THE SECOND CIRCUIT,
DATED AND FILED JULY 5, 2001.............-.-
-]-
PETITION FOR WRIT OF CERTIORARI
Rodriguez respectfully petitions this Court for a Writ of
Certiorari to review the judgment of the United States Court of
Appeals for the Second Circuit (App., infra, A26-A30).
OPINIONS BELOW
Luis Alberto Rodriguez appealed from the Judgment and
Order of the Hon. Carol Bagley Amon of the United States
District Court for the Eastern District of New York, dated
August 12, 1999 (App., infra, Al-A24), granting the U.S.
Government’s Motion to Dismiss the Appellant’s Motion for
Return of Property under Rule 41(e) of the Federal Rules of
Criminal Procedure (the “41(e) motion”).
On appeal, the Court of Appeals for the Second Circuit
affirmed the District Court’s dismissal and refusal to hear the
merits of Rodriguez’s case (App., infra, A31-A32).
STATEMENT OF JURISDICTION
Tie Court of Appeals entered its judgment on February
22, 2001, and denied Rodriguez’s Motion to Reargue, which
denial was entered July 5, 2001. The jurisdiction of this Court
is invoked under 28 U.S.C. § 1254(1).
="
STATUTORY AND CONSTITUTIONAL
PROVISIONS INVOLVED
STATUTES
19 U.S.C. $1609, §1615
CONSTITUTIONAL PROVISIONS
U.S. Const. Amend. V.
U.S. Const. Amend. VIII.
STATEMENT OF THE CASE
This case involves an attempt by the United States
government (the “Government”) to forfeit approximately
$366,000.00 in currency seized by agents of the U.S. Drug
Enforcement Administration (“DEA”) and agents of private and
' quasi-government entities working in concert with the DEA on
November 7, 1997 without demonstrable cause. Such forfeiture
is not supported by the law or the facts and, if permitted, would
place in jeopardy, without probable cause, persons such as Luis
Alberto Rodriguez (“Rodriguez”).
A. The Seizure
On November 7, 1997, when Mr. Rodriguez was at
LaGuardia Airport preparing to board his flight to Miami with
his daughter, the airport agent inspected their tickets and Mr.
Rodriguez passed his portfolio through the x-ray machine. He
was not carrying any other luggage nor had he checked any
a.
bags. He was carrying approximately $366,000 in cash, with
documents pertaining, in part, to that cash. After asking what
was in the portfolio, Rodriguez advised the security agent that
it was money, and disclosed how much, approximately.
Thereafter, a uniformed agent was called, along with a second,
Spanish-speaking person. Rodriguez does not speak, read or
understand any English. The Spanish-speaking person asked (in
Spanish) Rodriguez’s occupation, to which he responded (in
Spanish) “Businessman. ... I buy gold and jewelry.” This
person asked questions regarding Rodriguez’s flight, and
reviewed the documents in his portfolio, including the currency
declaration that was filed when the currency first entered the
United States. This Spanish-speaking person told Rodriguez
that everything was in order.
At that point, the uniformed officer, called over by the
airport security agent, took the documentation and asked
questions relating to various markings thereon. The uniformed
officer said “OK, very well.” Thirty minutes later two men
dressed in civilian clothes arrived and spoke with the uniformed
officer. They told Rodriguez and his daughter to follow, and led
them into a waiting police car which took them to a local station
at LaGuardia Airport. Upon arriving at the station of the Port
Authority police department at approximately 7:30 P.M., Mr.
Rodriguez was told to sit and was asked several questions. Mr.
Rodriguez presented to the Port Authority police all of the
money he was carrying and, after the initial questioning
additional officers frisked the person of Mr. Rodriguez and his
daughter and searched her pocketbook. At no point did anyone
identify himself or herself by name, badge or identification card.
Telling Rodriguez that he would be able to return the
next day to pick up his money, the Port Authority police
retained the currency and took photos of both Mr. Rodriguez
and his daughter. When asked for a reason, the officer said that
the photographs were for identification purposes and would help
wi
expedite the process when Mr. Rodriguez returned to claim his
money. Fifteen minutes later two more individuals came in --
DEA Special Agent Brian Fitzpatrick and one other. Fitzpatrick
commented "Big Fish" while typing something into a computer.
“Usted coca” was his next accusation, to which Mr. Rodriguez
explained (in Spanish) "you are making a mistake. Don't call
me a drug dealer." Because in retrospect he was mistaken, Mr.
Fitzpatrick, in an Affidavit he made to the court below, failed to
disclose that he had checked a computer to determine whether
Rodriguez or his daughter had any TECS history." Mr.
Rodriguez’s daughter started crying and asked, "why are you
calling us drug dealers, you are making a big mistake."
B. The Administrative Proceedings
On November 7, 1997, Rodriguez and his daughter were
detained and searched, and his money seized by the U.S. DEA.
On December 4, 1997, Rodriguez’s counsel, Carl Soller,
had a telephone discussion with DEA Special Agent Brian
Fitzpatrick. In that discussion Fitzpatrick acknowledged the
taking of Mr. Rodriguez’s cash, but refused, despite counsel’s
objection to the seizure and request for information supporting
its merits, to say more.
On December 29, 1997, Soller telephoned DEA Agent
Fitzpatrick for a second discussion relating to the seizure and
Rodriguez’s objections thereto. Fitzpatrick made no mention
‘Treasury Enforcement Communications System (“TECS”). As
part of Customs’ information management strategy, TECS
provides support for federal law enforcement missions by aiding
inspection personnel at borders of and ports of entry into the
United States. It has been termed by Customs as “the
clearinghouse for law enforcement data.” See CUSTOMS
SYSTEMS AND INFRASTRUCTURE OVERVIEW.
-5-
that the publication process had begun in order to initiate a
forfeiture of the currency. Despite this discussion and the
objections raised therein, and despite that neither Rodriguez nor
his daughter received a notice of seizure, the DEA continued its
publication of notice.
On January 8, 1998 Soller sent a letter to the DEA
explaining that "the funds confiscated were in no way related to
any drug offense" and that the Notice of Seizure was deficient
because it did not specify the related offense or the relevant
seizure provision, which, as pointed out in the correspondence
to Fitzpatrick, was "information ... absolutely essential for us to
properly proceed with our petition for remission under Title 19,
Sec. 1607 et seq."
On January 20, 1998, Soller had another telephone
discussion with the DEA, this time with an attorney (name not
certain), regarding the illegal seizure. The very next day the
DEA sent a response to Mr. Soller's January 8 letter explaining
that in its opinion the Notice of Seizure was constitutionally
sufficient in content.
In the January 21, 1998 response to Soller’s letter, the
Government set forth that pursuant to the regulations at 28 CFR
9.5(a)(4) "the Government's legal basis for seizing property and
pursuing forfeiture is not addressed during the petition process."
Left with no alternative method to contest the illegal
seizure, and in need of a judicial avenue to argue that the
Government had no probable cause to seize the currency,
Rodriguez filed and served the underlying 41(e) motion upon
the DEA. The DEA proceeded to forfeit the money on February
-6-
23, 1998, almost two weeks after the 41(e) motion was filed.”
The Government in turn moved to dismiss the 41(e) motion.
The District Court dismissed the motion on the grounds that it
lacked subject matter jurisdiction, the property having been
administratively forfeited. At no time throughout our written
and verbal communications was Rodriguez told why his money
was taken from him.
The Second Circuit, refusing to follow 10th Circuit case
law that allows the filing of a 41(e) motion in a district court,
affirmed the forfeiture, thereby allowing the Government to
keep $366,000.00, with no legal or equitable justification.
REASONS FOR GRANTING WRIT
I. THE SECOND CIRCUIT HAS ENTERED A DECISION IN
CONFLICT WITH THE DECISION OF THE TENTH (10TH)
CIRCUIT, AS TO CALL FOR AN EXERCISE OF THIS
COURT’S SUPERVISORY POWER.
Aside from ignoring this Supreme Court’s idea and
concept in the 1983 case U.S. v. $8.850, 461 U.S. 555, 103
7A typical forfeiture might take place no sooner than four months
from the date of seizure, See Sterling v. U.S. 749 F.Supp. 1202
(E.D.N.Y. 1990). Reminiscent of the Government's behavior in
Muhammed v. Drug Enforcement Administration, 92 F.3d 648
(8 Cir 1996), where the court noted that "the motion evidently
triggered administrative forfeiture proceedings," Id. at 650, the
Government responded to the filing of the 41(e) motion by
immediately proceeding with a forfeiture. The Government,
actually, asked for an extension of time in which to respond to
the motion, and then used that time to forfeit the currency.
. 3
S.Ct. 2005, 76 L.Ed.2d 143 (1983)’, the District Court rejected
the holding in the Tenth Circuit decision in Floyd v. U.S., 860
F.2d 999 (10th Cir. 1988), a case that supports a Court's
equitable jurisdiction. The Court did, however, cite and rely
upon conflicting decisions outside the Second Circuit, namely
the Sixth (6th) and Eleventh (11th) Circuits.
The court in Floyd explained that:
The equitable nature of 41(e) is well established, and we
have no difficulty reading equitable constraints into the
text of the [drug] statute for that purpose. Id. at 1003.
In dismissing Floyd, the District Court in Rodriguez
explained that it is not bound by a Tenth Circuit opinion (“The
Court notes initially that it is not bound by a decision from the
Tenth Circuit.” (Decision and Order of Hon. Carol B. Amon, at
A17), and cites factual differences in the two cases.
The Court does, however, rely on the Eleventh Circuit
decision in $67,470.00 v. United States, 901 F:2d 1540 (11 Cir.
1990), the Sixth Circuit decision in Shaw v. United States, 891
F.2d 602 (6 Cir. 1989), and the decision in United States v. One
1988 Mercedes Benz, VIN No. WOBBA48D5JA087263, 719
F.Supp. 595 (E.D.Mich. 1989) to support the reverse position --
that it would “not come to the aid of a litigant who chooses not
to pursue available legal avenues for relief.” $67,470.00 v. US.,
at 1545.
The Court relies on the decisions in the 1987 Jeep
3 Holding, on different facts, that when the claimant in a
currency seizure case “believes the seizure was improper, he
could file a motion under Federal Rule of Criminal Procedure
41(e) for a return of the seized property.” 103 S.Ct. at 2014, 461
US. at 569.
Wrangler case and Onwubiko v. U.S., 969 F.2d 1392 (2d Cir.
1992), along with other District Court cases (dealt with below)
to support the proposition that the administrative forfeiture in
this case cut off all of the District Court's jurisdictional authority
to hear the case on its merits. Again, equitable jurisdiction is
missed. Onwubiko does not support this holding at all. As a
matter of fact, the Second Circuit in that case, on much weaker
facts, reversed the District Court's judgment (which upheld a
summary forfeiture) and directed that a judicial proceeding be
instituted. Onwubiko, 969 F.2d at 1400.
In Onwubiko, the claimant was arrested and pled guilty
to the charges. Most important, the Court said nothing of a
41(e) motion not being appropriate in a case such as Rodriguez’.
The Court only noted that 41(e) motions are not brought after
the conclusion of a criminal case, and that it is inappropriate for
the District Court in that case to deem the plaintiff's submission
(it was in the form of a letter to the Court) a 41(e) motion. Id. at
1396-97. Even in those circumstances, where the submission to
the Court was made in the form of an unsworn statement with
no legal support, the Court was instructed, on remand, to
entertain the substance of the submission, Id. at 1394-95, and to
exercise its jurisdiction. Id, at 1398.
Most striking in Onwubiko, is that the Court reasoned a
41(e) motion is not brought (in the criminal context) after the
conclusion of a case. The same holds true in Toure v. U.S., 24
F.3d 444 (2d Cir 1994) (the plaintiff was arrested, pled guilty,
waited over four months since the Notice of Seizure was
mailed, and brought an action to recover his property) and in
One 1987 Jeep Wrangler (the plaintiff was arrested, pled guilty,
and, almost three months later, filed a motion seeking return of
his property).
The District Court below also rejected the holding in
Camacho v. U.S., 645 F.Supp 725 (E.D.N.Y. 1986)
-9-
(McLaughlin, J.), as “wrongly decided” and “undermined by the
more recent Second Circuit decisions in One 1987 Jeep
Wrangler and Onwubiko.” (App. A1l5) Factually, Camacho
remains the single case almost precisely on point; the district
court there recognized that a 41(e) motion was “properly made,"
and that "[{the] Court has subject matter jurisdiction.” Id. at 727.
As in the instant case, the claimant in Camacho entered
LaGuardia Airport heading for Miami, Florida, the airport
officer conducted an x-ray scan that revealed currency and
followed that with a questioning, (Rodriguez’s money was not
in any way hidden), the claimant was allowed to go free and the
money was retained. The claimant's attorney sent a letter to the
DEA questioning the propriety of the seizure and demanding
return of the money and the Government then initiated forfeiture
proceedings. In Rodriguez’s case they did not even wait that
long. In both cases, correspondence contesting the seizure was
forwarded to the Government, and neither an administrative
claim was filed nor a bond posted. Seven months later in
Camacho, a successful 41(e) motion was brought. Id. In
Rodriguez’s case, less than two weeks had passed before the
41(e) motion contesting the seizure was brought.
We respectfully — that the rationale in Camacho
should apply here.
I. THE SECOND CIRCUIT HAS DECIDED AN
IMPORTANT QUESTION OF FEDERAL LAW THAT HAS
NOT BEEN, BUT SHOULD BE, SETTLED BY THIS
COURT.
The issues raised herein and contested in various forms -
and with varying results by the district courts and courts of
appeals have not to date been resolved in a clear manner by the
U.S. Supreme Court.
-10-
In 1999 the Legislature did its part by passing the Civil
Asset Forfeiture Reform Act of 1999, and the Supreme Court
did its part in 1997 to address the issue of Excessive Fines in
currency seizure and forfeiture cases. See below, Point 4(b):
The Legal Climate Concerning Civil Asset Forfeitures; citing
USS. v. Bajakajian, 524 U.S. 321; 118 S.Ct. 2028; 1998 U.S.
LEXIS 4172; 141 L. Ed. 2d 314 (Decided June 22, 1998).
The Supreme Court has not, however, made clear the
procedures a claimant should take when faced with an illegal
seizure -— or any seizure for that matter. Courts have
jurisdiction, but exercise that jurisdiction intermittently and
randomly. Some cour‘s hear 41(e) motions while others do not.
Il. THE COURT OF APPEALS ERRED IN DETERMINING
THAT LUIS RODRIGUEZ HAD AN ADEQUATE REMEDY
AT LAW TO CONTEST THE SEIZURE OF HIS
CURRENCY; THE COURT OF APPEALS ERRED IN
DETERMINING THAT IN A JUDICIAL FORFEITURE
PROCEEDING, A CLAIMANT CAN CHALLENGE THE
LEGALITY OF A SEIZURE.
The District Court should have heard the Rule 41(e)
motion or should have fashioned an alternative judicial remedy
for Rodriguez to argue that his property was illegally seized.
The District Court had equity jurisdiction to hear the motion
under Rule 41(e) or to fashion the alternative remedy.
The avenues set forth by the District Court, and affirmed
by the Second Circuit as adequate remedies for Rodriguez do
not afford him the opportunity to contest the legality of the
Government’s seizure. At best, Rodriguez would have to file a
claim and bond and await the institution of judicial forfeiture
proceedings by the Government which could then wait a year
or more to file a forfeiture suit, by even the District Court’s and
-]1-
the Second Circuit’s admissions. More important, the
Government, to bring such an action, need only show probable
cause to forfeit as of the time the action is filed. The
Government’s forfeiture action does not necessitate a finding of
a proper seizure, an essential element to the establishment of an
adequate remedy at law.
A. The Courts Should Have Heard the 41(e) Motion
Under Its Equity Jurisdiction - Rule 41(e) Affords
the Only Remedy for the Illegal Seizure in this Case
$. Background:
Rule 41(e) of the Federal Rules of Criminal Procedure
provides:
(e) Motion for Return of Property. A person aggrieved
by an unlawful search and seizure or by the deprivation
of property may move the District Court for the district
in which the property was seized for the return of the
property on the ground that such person is entitled to
lawful possession of the property.
Fed. R. Crim. P. R. 41(€).
The United States Supreme Court, in U.S. v. $8,850,
461 U.S. 555, 103 S.Ct. 2005, 76 L.Ed.2d 143 (1983), held that
when the claimant in a currency seizure case “believes the
seizure was improper, he could file a motion under Federal Rule
of Criminal Procedure 41(e) for a return of the seized property."
103 S.Ct. at 2014, 461 U.S. at 569. In that case, the Supreme
Court found that the claimant's failure to either request a judicial
forfeiture action or, alternatively, to file a 41(e) motion “can be
taken as some indication that [he] did not desire an early judicial
hearing." Id. The facts in this case differ, but the Supreme Court
does maintain that where a claimant feels that due process has
been violated by an illegal search and seizure, 41(€) is
82.
appropriate for lack of an adequate civil remedy.
Without a 41(e) motion, Rodriguez is left entirely to the
whims of the Government which is reviewing the facts of its
own ex-parte seizure without the necessity of reviewing the
legality of the search and seizure to begin with. The Fifth
Amendment assures claimants like Rodriguez due process of
law. U.S. Const. Amend. V.
The Government's position in this case, instead of
conceding that it has the burden of affording due process, places
the onus on the deprived person, in this case stripped of a
substantial sum of his money, to show lack of due process. See
U.S. Const. Amend. V.
2. The District Court’s Authority — 41(e):
Where a formal criminal action is pending before the
District Court, there is no dispute that the Court may hear a
41(e) motion relating to that action. Even where no formal
criminal action is pending, the Courts have entertained 41(e)
motions on principles of equity. The Fifth Circuit stated well
that Rule 41(e) is a "crystallization of a principle of equity
jurisdiction [which] persists as to situations not specifically
covered by the rule." Hunsucker v. Phinney, 497 F.2d 29, 34 (5
Cir. 1974). Thus, where there is no "suggestion of criminal
proceedings," a 41(e) motion "is more properiy considered
simply as a suit in equity rather than one under the Rules of
Criminal Procedure." Richey v. Smith, 515 F.2d 1239, 1245 (5
Cir. 1975).
The Courts below should have recognized the
impropriety of forcing a claimant to await formal action before
seeking the return of money that is illegally seized. Claimants
such as Rodriguez could otherwise be forever deprived of the
41(e) motion and the Government would be in a position to
Cs
flounder with cases such as these without ever being compelled
to support the legality of its seizure outside of a judicial
forfeiture proceeding, and even there the Government is
restricted only by the relevant statute of limitations.
In Matter of 6455 South Yosemite, etc., 897 F.2d 1549
(10th Cir. 1990), the Tenth Circuit explained that Rule 41(e) is
to be available to persons who are not yet defendants in a
criminal case if they seek recovery of property seized by the
Government. Id. at 1554. In Rodriguez’s case, there was never
a threat by the Government that an indictment would be
returned. The Court’s equitable jurisdiction, therefore, comes
into play immediately to allow Rodriguez to appropriately
attack what the Government has done in making the seizure.
Rule 41(e) is designed to combat overreaching and
abuses of the seizure authority. United States v. Rapp, 539 F.2d
1156 (8th Cir. 1976). Rule 41(e) affords a remedy for the
victims of unlawful searches and seizures.
The rule itself provides, in pertinent part, that:
A person aggrieved by an unlawful search and seizure or
by the deprivation of property may move the District
Court for the district in which the property was seized
for the return of the property on the ground that such
person is entitled to lawful possession of the property.
Fed.R.Crim. P. R. 41(e).
In Roberts v. United States, 656 F.Supp. 929 (S.D.N.Y.
1987), reversed on other grounds, 852 F.2d 671 (2d Cir. 1988),
cert. denied 488 U.S. 993 (1988), the issue before District Judge
Sweet was whetlier or not to read an “irreparable harm”
standard into Rule 41. Judge Sweet relied upon the Supreme
Court's decision in Schiavone v. Fortune, 477 U.S. 21, 106 S.
Ct. 2379 (1986), a case that involved Rule 15(c) of the Federal
-14-
Rules of Civil Procedure. The Supreme Court held that because
the plain meaning of the rule was unambiguous, it was not
subject to interpretation and the rule was accepted "as meaning
what it says." Schiavone v. Fortune, 106 S.Ct. at 2385. Since
the rule said nothing about a showing of irreparable harm,
District Judge Sweet declined to read those words into it.
Roberts v. United States, 656 F.Supp. at 932.
Magistrate Judge Francis followed Judge Sweet's lead
and refused to graft an irreparable harm requirement onto Rule
41(e). See United States v. The Premises Known as 25 Coligni
_ Ave., New Rochelle, New York, 120 F.R.D. 465 (S.D.N.Y.
1988). He further stated: "Nor should the litigant be required to
justify the need to vindicate constitutional rights.” Id. at 468-69.
See also In re First United Financial Corp., 620 F.Supp. 1450,
1452 (E.D.N.Y. 1985).
3. The District Court’s Authority —
“Anomolous Jurisdiction”:
Recent case law has limited the hearing of 41(e) motions
in the District Court under the Court’s "anomalous" or equitable
jurisdiction (a) where criminal proceedings are pending when
the motion is brought or (b) where the movant has no readily
available statutory or other civil remedy to contest ownership of
property and the lawfulness of a seizure. Boyd v. U.S. Dept. of
Justice, 673 F.Supp. 660 (E.D.N.Y. 1987).
While "anomalous" jurisdiction has resulted in federal
courts hearing motions to facilitate the return of improperly
seized property, Boyd, 673 F.Supp at 663, citing U.S. v.
Martinson, 809 F.2d 1364 (9 Cir. 1987), the District Court in
this case denied Rodriguez’s right to be heard on the basis that
administrative forfeiture proceedings had begun. The Court
then concluded that even if it could exercise equitable
jurisdiction, it would not be appropriate in Rodriguez’s case
-15-
[because] there needs to be “a showing that there is no adequate
remedy at law,” [citing] Boyd, United States v. An Antique
Platter of Gold, 95 MAG 2167 (NRB), 1995 WL 758762
(S.D.N.Y. Dec. 22, 1995), i.e. if there is an available statutory
or civil remedy to contest ownership of property and lawfulness
of seizure, a court should not find anomalous jurisdiction. The
key factor is the adequacy of the movant's remedy at law, Boyd,
673 F.Supp. at 664, and the determination turns on the facts and
circumstances of the particular case at bar. Matter of
$91,000.00, 715 F.Supp 423, 434 (D.R.L 1989).
4. The Issue of Adequate Remedy is a Factual Issue:
The issue of an “adequate remedy” was treated by the
district court as a “given,” The court erred by asserting that
Rodriguez’s options were “adequate” without assessing the
practicality of his options (or lack of options). The district court
decided that because the statute provides a remedy, any claimant
who is subject to that statute and who uses that remedy is
sufficiently protected.
The recently enacted Civil Asset Forfeiture Reform Act
and its accompanying legislative history provide insight. as well
as wrenching stories and incidents resulting from the
Government’s capricious taking and forfeiting of currency and
property under the guise of a drug war. The June 11, 1997
Judiciary Committee meeting for the Civil Asset Forfeiture
Reform Act (H.R. 1658) comprises a majority of the Act’s
legislative history. The purpose of the reference to the
legislative history is to shed light on the circumstances that led
to the recent passing of the Civil Asset Forfeiture Reform Act,
and the very circumstances that Rodriguez found himself in.
This climate, and the practicalities surrounding forfeiture and
the damage it has done to families should have been considered
by the District Court when it made its finding of “adequate
remedy.”
-16-
Toclarify, the legislative history is not referenced herein
because the law should apply retroactively, as much as because
it sheds light on what occurs when Government seizures and
forfeitures take place. It sheds light on what would have been
Rodriguez’s likely fate had he gone down the seemingly endless
and abusive “claim and bond” route. :
By way of summary, the Congressional Meeting
included testimony from individuals who had had first hand
experience with civil asset forfeiture. Billy Munnerlynn was the
owner of a once successful air charter service who spoke of his
struggle to recover one of his airplanes seized by the Drug
Enforcement Administration. E.E. “Bo” Edwards Il
represented Richard T. Lowe, M.D. in his suit to recover more
than $2.8 million of his life savings that had been improperly,
though innocently deposited in a bank account he had
established to benefit a private academy in his hometown. F.
Lee Bailey also testified about his representation of a Florida
couple whose business has been effectively shut down by a civil
asset forfeiture action.
In all these cases, the delays, fees and other effects on
the lives of innocent owners are astounding. After going through
a civil trial, Billy Munnerlynn explains:
I used up most of my savings, I had to hire a criminal
attorney in the early aspect. Once it went to civil, this first
attorney couldn't handle it so I had to hire another attorney. It
was a constant thing fighting them to keep my Lear jet and my
property. I went to a jury trial, eight of my peers. They ruled in
my favor twice, said I should get all my money back. The
Government had taken all my money and my Lear jet. The
judge reversed this favorable verdict, and ordered me to another
trial.
Anyway, I was forced to settle the thing. To even make
-17-
it worse, later on I don't know why this all happened. You have
to understand that in the years that I have been flying this
airline, working as a transport pilot flying jets out of Salt Lake
City, I flew for Majestic Airlines, for many airlines. All of a
sudden I could not even get a job with these airlines. These
airlines haul mail that's Federai. I was put on a list. I can't think
of the name of it, but the DEA uses it to identify possible drug
runners and gun runners and money launderers. I couldn't work
anywhere. Basically, I was forced to sell the other prop
airplanes that I had flying into the Grand Canyon. I had four
prop planes, a Malibu a 210, and a training plane. I was forced
to sell all these aircrafts to pay my attorney bills.
Now that all these things are gone, all the money is
gone. I filed for bankruptcy. We lost our home. We lost all our
aircraft. I lost my airline certificate. The Federal Government
told me they would wait to see the outcome of the forfeiture
hearings.. It wouldn't be right for them to destroy my certificate,
I spent over $200,000 getting that certificate. My pilot license
and Mr. Bailey, I believe, can confirm this, cost well over
$80,000. The Lear jet cost $500,000. I can assure this
committee I have never ever given thought to ever breaking the
law, much less flying money launderers, drug people. I am far
removed from that. I would never ever risk what I hdd for that.
Id. at 13-15.
In describing how a doctor’s life savings were seized,
E.E. “Bo” Edwards II stated:
There is such a strong tendency in the way that law
enforcement agencies use civil forfeiture today, and the way
they have been using it for a decade, to seize property when they
find it and justify it later. That is especially true in cases where
no criminal charges are brought against the owner of the
property. Id. at 23. He further explains that Current law
allows—indeed, promotes—law enforcement agencies to seize
-18-
property without cause, and then undertake an investigation,
including the use of discovery and depositions from claimants,
to locate evidence which can be used to forfeit the property. So
long as the burden of proof remains on the property owner, such
a greedy, strong-armed approach is encouraged. A sizable
portion of civil forfeitures occur against property owners who
are never charged with any criminal offense.
Institutional greed is inevitable when the law allows the
initial seizure with so few safeguards. 19 U.S.C. 1615, which
applies to all drug (881) and currency violation (981)
forfeitures, provides that “probable cause shall be first shown
for the institution of such suit or action...” Some courts have
read this language to mean what it says. That is, the
government must demonstrate on the day the forfeiture case is
filed in district court that it possessed proof establishing
probable cause to believe the property in question is subject to
forfeiture. The government should not be allowed to use
depositions and discovery to make a case when it had no case at
the outset. Id. at 40, citing , e.g., Uni Vv
897 F.2d 1457, 1462 (8th Cir. 1990); United States v. Monkey,
725 F.2d 1007, 1011 (Sth Cir. 1984).
The point made consistently by the legislative history is
that the procedures put in place and declared “adequate” by the
court below are, at times, simply inadequate.
B. The Remedies Offered to Rodriguez Were
Inadequate:
The District Court erred in finding that “[o}nce the
administrative proceedings are commenced, the statute
governing the filing of a claim and bond provides an adequate
remedy.” (Amon Decision and Order, at A13.) The Court, at
oral argument, did acknowledge that of the two options of either
petitioning the DEA on the administrative level, or filing a
-19-
claim and bond to have a judicial forfeiture action filed in the
District Court, the former is barely a viable alternative.* —
In its response to the Soller letter of January 8, 1998, the
Government, too, makes it clear that pursuant to the regulations
at 28 CFR 9.5(a)(4) "the Government's legal basis for seizing
property and pursuing forfeiture is not addressed during the
petition process."
The remaining claim and bond procedure, however, is
also an inadequate remedy for contesting the seizure:
1. The Different Burdens of Proof:
When bringing a forfeiture action, the Government is
bound to meet its burden of proof with respect to the seized
property as of the time the action is filed. This was
acknowledged by the Government at oral argument. (Amon
Decision and Order, at 14.) According to the Government’s
position in this case, there is no procedure, nor should there be,
for contesting the legality of the seizure itself, i.e. for bringing
an action in court that would require the Government to meet its
burden of probable cause at the time of the seizure. In theory,
then, the Government can illegally seize property, await a claim
and bond, delay the filing of-an action for at least one year (see
Argument 2: “The Delay the Government Can Impose,” infra),
and never be required to establish a legal seizure.
The Irony: With a seizure pursuant to a search warrant,
“At oral argument, Soller made the claim that the District
Court has “no ability, if [Rodriguez] chose the
administrative route, to review the Government’s decision
on how much is to. be forfeit.” The Court responded:
“That’s true, but you could have chosen number two,
which is you file a claim and bond, and it is before the
Court ...”
-20-
the Government would not argue against the viability of a 41(e)
motion. Thus, where at least one judicial authority reviews the
warrant and puts his/her imprimatur on it, the seizure is subject
to judicial review. With an ex-parte DEA seizure, where no
judicial authority is involved in the taking, the Government
argues, and the District Court decided, that there is no
entitlement to such review.
Indeed with respect to the $366,280 seized, there was
neither a search warrant, nor any exception to the search warrant
requirements; Mr. Rodriguez and his daughter were detained
‘ without probable cause and forced to accompany Government |
agents to an automobile to be transported off the airport to the
office of, presumably, the Drug Enforcement Agency or its
agents.
2. The Delay the Government Can Impose:
"(T]he determination of when the Government is to
proceed against a piece of property is seemingly discretionary
and limited only by the relevant statute of limitations." United
States_v. One 1987 Jeep Wrangler Auto. VIN No.
2BCCL8132HBS 12835, 972 F.2d 472, 480 (2d Cir 1992). The
Court rejected Rodriguez’s argument that by filing a claim and
bond, Rodriguez and his money were subject to the
Government’s discretion as to how and when the action would
be brought once the claim and bond were filed. The Court did
make mention of the five year statute of limitations, but relied
also on the Due Process Clause, citing U.S. v. $8.850; Creative
Electronic, Inc. v. United States, No. 95-CV-0302 (RSP/GJD)
1995 WL 494002 at *6-7 (N.D.N.Y. Aug. 16, 1995), in which
the Customs Service (incorrectly named by the lower court as
the DEA) was directed to initiate a judicial forfeiture action
after a sixteen month delay.
In either case, Rodriguez would not get the initial filing
-21-
of a forfeiture action until after a year has passed, in the best
scenario, and would likely not get a decision on the merits (of
the forfeitability of the property, and not even the legality of the
seizure) until long thereafter. The amount of money at issue and
the circumstances of the seizure in this case should have
warranted an immediate hearing in court.
G The Claim and Bond Are Not An Exclusive Remedy;
The Administrative Process, ipso facto, Does Not
Remove this Case From the District Court’s
Jurisdiction Below, the Government argued that:
The statute [19 U.S.C. §1609] implicitly recognizes that
the filing of a claim and cost bond is the sole method by which
a claimant stops the administrative forfeiture and obtains review
in district court of the probable cause for the forfeiture.
Respondent Brief to the Court of Appeals at p. 13. This
argument is based on the language in the statute whereby if a
claim and bond are not filed, a seizing agency shall declare a
forfeiture. See 19 U.S.C. §1609.
Aside from its conclusion that the statute makes the
implication that the claim and bond procedure is an exclusive
and sole remedy, the Government provides no explicit legal
basis for excluding other remedies or judicial means. The single
case cited by the Government is a Seventh Circuit case, and it
quoted without regard to its context. See Respondent Brief at
13, and Willis v. United States, 787 F.2d 1089, 1094 (7th Cir.
1985), cited therein.
First, in that case, the claimant filed a petition with the
seizing agency, chose the administrative route, and then filed a
complaint in district court over a year after the seizure, and over
nine months after being denied on the petition. Willis, at
1091-92. Further, the claimant argued that the notice failed to
-22-
inform him of the fact that the administrative route would
deprive him of a judicial hearing. In correcting this erroneous
reading of the legal framework, the court held that “since the
notice given Willis [the claimant] adequately informed him of
his rights, his failure to pursue a hearing on probable cause
effectively waived his opportunity to do so now.” Id., at
1093-94.
umphasis should be placed on the term “now” used by
the court in its decision-- a term omitted by the Government in
its Brief. Notice should also be taken that the court speaks in
general terms, indicating simply that th > claimant should have
pursued a probable cause hearing, as did Rodriguez in this
action. ~
D. Without Invoking its Equitable Jurisdiction, the
Court Should Have Treated The 41(e) motion as (a)
a Motion Seeking Mandamus Compelling the
Initiation of a Judicial Forfeiture Action; (b) a
Motion for a Stay of Administrative Forfeiture
Pending the Filing of a Claim and Bond; or (c) Any
Other Remedy Which the Court Could Have
Deemed Appropriate in Order to Afford Rodriguez
a Judicial Hearing on the Merits of the Seizure
The circumstances of this case dictate that absent the
right to file a 41(e) Motion, which Rodriguez should have been
granted, the District Court should have at least treated the 41(e)
motion as anything other than the Government's ticket to final
forfeiture of the currency. In Onwubiko, (discussed under
Subheading C., supra) this Court reversed the District Court's
judgment (which upheld a summary forfeiture) and directed a
judicial proceeding be instituted. Onwubiko, 969 F.2d at 1400.
-23-
IV. FORFEITURE IS TOO DRASTIC IN THIS CASE
The court of appeals erred in affirming a forfeiture of
approximately $366,280.00 in U.S. currency, an amount far in
excess in proportion to the procedural defect the court alleges to
have occurred. The courts have found that allowing a forfeiture
in cases similar to this one, i.e. of $366,280.00, is excessive.
We find that to be especially true given the lack of any evidence
of wrongdoing. ]
A. The Amount of Money Seized is Too Great a
Penalty for an Alleged Procedural Defect:
Assuming, arguendo, that Rodriguez’s money was justly
seized and then properly forfeited, the Government’s best legal
position is that due to a procedural defect in the handling of his
claim, $366,280.00 has been confiscated and forfeited. The
Government failed to allege or show that Rodriguez did
anything wrong. The forfeiture of almost $370,000.00 far
exceeds the bounds of equity in such a case.
The Eighth Amendment to the United States
Constitution provides against the imposing of “excessive fines”
and “unusual punishments.” Id. Where there is no guilt on the
part of the claimant, the forfeiture is all the more drastic a
remedy for the Government.
Just over two years ago, the United States Supreme Court,
in United States v. Bajakajian, 524 U.S. 321; 118 S.Ct. 2028;
1998 U.S. LEXIS 4172; 141 L. Ed. 2d 314 (Decided June 22,
1998), held that the taking of $357,144.00 in a civil forfeiture
was grossly disproportionate to the claimant’s failure to declare
the currency. ‘
-24-
In that case, customs inspectors found the claimant and his
family preparing to board an international flight carrying
$357,144. The claimant was charged with, inter alia, attempting
to leave the United States without reporting, as required by 31
U.S.C. § 5316(a)(1)(A), that he was transporting more than
$10,000 in currency. The Government also sought forfeiture of
the $357,1 44.00 under 18 U.S.C. § 982(a)(1), which provides
that a person convicted of willfully violating §5316 shall forfeit
"any property . . . involved in such an offense." Id. The
claimant pleaded guilty to the failure to report and elected to
have a bench trial on the forfeiture.
The District Court found, among other things, that the entire
$357,144.00 was subject to forfeiture because it was involved
in the offense, that the funds were not connected to any other
crime, and that Bajakajian was transporting the money to repay
a lawful debt. Id.
Concluding that full forfeiture would be grossly
disproportional to the offense in question and would therefore
violate the Excessive Fines Clause of the Eighth Amendment,
the court ordered forfeiture of $15,000, in addition to three
years’ probation and the maximum fine of $5,000 under the
Sentencing Guidelines. The Ninth Circuit affirmed, holding that
a forfeiture must fulfill two conditions to satisfy the Clause: The
property forfeited must be an "instrumentality" of the crime
committed, and the property's value must be proportional to its
owner's culpability. Id.
While not addressing the exact statutory framework in
which Rodriguez’s case is found, the Supreme Court’s message
is clear: Even if found guilty, a claimant’s fine should be in
proportion to his culpability.
At about the same time as the Bajakajian decision, the
House approved a measure that would curb the Government’s
-25-
authority to seize property. With the Civil Asset Forfeiture
Reform Act, which was passed only days prior to the
preparation of the appeal brief in this case, Congress has made
it more difficult for Federal and state law enforcement
authorities to confiscate property before they bring criminal
charges in narcotics and other cases. See H.R. 1658. Under the
new legislation, the Government can confiscate property only if
it first shows there is a substantial nexus between the property
and the crime “by clear and convincing evidence.” This shifts
the burden from the original scheme, where the Government
would only have to show probable cause, and the claimant
would have the burden of proving that it is an “innocent owner.”
The legislation also eliminates the bond provision for owners
claiming an interest in the seized property.
In both instances the representation made by this Supreme
Court and by Congress is that the environment in which
Rodriguez’s taking took place is undergoing much-needed
reform. Due process has been lacking, and Rodriguez’s case is
a perfect example.
-26-
CONCLUSION
This case involves questions of critical importance to the
proper construction of the nation’s seizure practices and
forfeiture laws and how those laws and procedures are to be
applied so as not to deny fair and due hearings and process.
If not reviewed, the District Court and Second Circuit
decisions will lead to more unfair results. The decisions will
deny claimants the right to contest the merits of a seizure and
the right to a day in court without delay.
Circuit decisions will remain unclear and in conflict.
For these and all the foregoing reasons, Rodriguez’s petition
for a writ of certiorari should be granted.
Respectfully submitted,
Carl R. Soller
Counsel of Record
Hodgson Russ LLP
Attorneys for Petitioner
152 West 57th Street
New York, New York 10019
(212) 751-4300
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APPENDIX A
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
x
In re Seizure of Certain Property
including $370,000 more or less
on November 7, 1997
98 CV 1026 (CBA)
MEMORANDUM AND ORDER
AMON, UNITED STATED DISTRICT JUDGE
Introduction
Luis Alberto Rodriguez-Rodriguez has moved
pursuant to Fed. R. Crim. P. 41(¢) for an order directing
the return of approximately $370,000 in currency seized
from him at LaGuardia Airport on November 7, 1997. The
government in turn moved to dismiss his application for
lack of subject matter jurisdiction, pursuant to Fed. R. Civ.
P. 12(b)(1).
A2
For the reasons that follow, the Court holds that
it has no subject matter jurisdiction to review the merits of
the subject forfeiture. The Court does have jurisdiction to
address whether the administrative forfeiture proceeding
comported with procedural due process. Since the Court
finds no procedural infirmity, the government's motion to
dismiss is granted.
Background —
.. Sei F the Subject C
On November 7, 1997, movant Rodriguez and
his daughter, Maria Patricia Garay, were scheduled to take
an American Airline’s flight from New York’s LaGuardia
Airport to Miami. While at LaGuardia, an airport security
officer stopped Rodriguez and questioned him about the
contents of his luggage. Mr. Rodriguez informed the
security officer that he was carrying money in connection
with his business. After further questioning, he and his
daughter were taken to a security office at LaGuardia.
Airport security personnel subsequently contacted
Brian Fitzpatrick, a Special Agent of the United States Drug
Enforcement Agency (the "DEA"), and: requested that he
participate in the investigation of Rodriguez. Special Agent
Fitzpatrick conducted a further examination of Rodriguez at
LaGuardia. A search of Rodriguez's person and his luggage
uncovered $366,280 in currency, the vast majority of which
consisted of old bills in $20 denominations. Special Agent
Fitzpatrick seized the currency and certain personal property
of Rodriguez and Garay on behalf of the DEA.’
' In an affidavit filed in connection with this motion,
Agent Fitzpatrick details certain responses given by Rodriguez
which called into question his claim that he was a jewelry dealer.
A3
On or about November 10, 1997, Solomon Antar,
Esq., contacted Special Agent Fitzpatrick. Mr. Antar
explained that he was an attorney representing Rodriguez
and requested information on how Rodriguez could reclaim
the currency and his personal property. Mr. Fitzpatrick
explained that the matter would be turned over to the DEA
Asset Forfeiture Unit and thereafter he provided Mr. Antar’s
name and address to that unit. On or about November 2, 1997,
an individual acting on Mr. Antar’s behalf picked up
Rodriguez’s personal property from the DEA. The DEA
retained the subject currency. Thereafter, Mr. Fitzpatrick was
contacted by Carl Soller, Esq., whom he also referred to the
DEA Asset Forfeiture Unit.
B. The Forfeiture P i
After a review of the forfeiture report concerning
the currency seized from Rodriguez, the DEA concluded
that probable cause existed for the seizure and accepted the
case for administrative forfeiture. On December 15, 1997,
the DEA mailed three written notices of the seizure. The
first of these notices was sent by certified mail, return receipt
requested, to Rodriguez's daughter, Garay, at 84-30 SW 81
LN, MIAMI, FL 33143. The second notice was sent by
certified mail, return receipt requested, to Rodriguez, care
of Solomon Antar, at 42 FALMOUTH ST., BROOKLYN,
NY 11235. On December 23, 1997, an individual
accepted delivery of this notice. The third notice was sent
He also notes that Rodriguez had no explanation for the great ~
number of $20 bills and that several days after the stop, a specially
trained dog alerted positively to the presence of narcotics on the
currency.
A4
* to Rodriguez at 144-50 SW 94thLN, MIAMI, FL 33186.’
The Postal Service returned this notice to the DEA as
undeliverable on January 6, 1998.
Each of the notices of seizure included the
following information:
The property seized and the date and
place of the seizure;
The person from whom the property was
seized;
Notice that the DEA has seized the
property for forfeiture pursuant to 21
U.S.C. § 881 because it was used or
acquired as a result of a drug-related
offense;
An explanation that a claimant could
request remission (pardon) or mitigation
of the forfeiture by submitting a petition
for remission or mitigation within thirty
(30) days from the receipt of the notice
and a discussion of the procedures and
requirements for filing such a petition;
An explanation that in addition to or in
lieu of filing a petition for remission or
mitigation, a claimant could contest the
forfeiture in federal district court; and
2 This address appears on the receipt for the currency
seized that was completed by Federal Agent Fitzpatrick.
A5
° A discussion of the procedures for
commencing such an action in district
court, including the requirement that a
claimant must first file a claim of
ownership and a cost bond (or, in the
alternative, a Declaration in Support of
Request to Proceed In Forma Pauperis)
with the DEA within 20_days of the first
publication of the notice of seizure in the
USA Today.
On December 24, 1997, December 31, 1997,
and January 7, 1998, the DEA published notice of the
seizure of $366,280.00 in currency in USA Today. These
notices also included the information outlined above, except
that they set a January 13, 1998, deadline for filing a claim
and posting a bond or for filing a petition for remission or
mitigation.
On January 2, 1998, the DEA sent an additional
written notice of seizure via certified mail, return receipt
requested, to Rodriguez care of Carl Soler, the attorney
representing Rodriguez in this proceeding.’ This notice was
accompanied by a letter stating that because of an unavoidable
delay, the DEA would allow 20 days from the receipt of
the letter and notice (as opposed to 20 days from the first
date of publication in USA Today) for Rodriguez to
respond as he deemed appropriate. An individual signing
3 Mr. Soller contacted Special Agent Fitzpatrick in early
December 1997, to advise him that he would be taking over the
representation of Rodriguez from Solomon Antar. Special Agent
Fitzpatrick contends that he told Mr. Soller to notify the DEA
Asset Forfeiture Unit that he was going to be representing
Rodriguez because Special Agent Fitzpatrick previously submitted
Mr. Antar’s name as Rodriguez's attorney.
A6
as the "Addressee or Agent" accepted delivery of this notice
on January 8, 1998.
The DEA senta final written notice of seizure on
January 14, 1998, to MS. MARIA PATRICIA GARAY
A/K/JA, MARIA PATRICIA RODRIGUEZ-GUZMAN,
84-30 S.W. 81* LANE, MIAMI, FL 33143. A letter
accompanying this notice similarly provided 20 days from
receiptto respond. An individual accepted delivery of this
notice as the "Addressee or Agent." Both the notice sent
to Mr. Soller and the second notice sent to Garay included
the information outlined above.
On January 13, 1998, the DEA received a letter
from Mr. Soller, dated January 8, 1998, concerning the
notice of seizure. In this letter, Mr. Soller asserted that
the notice of seizure contained deficiencies "in a number of
categories." In particular, Mr. Soller assailed the failure
of the DEA to identify what “drug related offense" justified
the seizure of the currency or the "provision of law that
authorized a seizure under the circumstances of this particular
case." Mr. Soller requested such information on behalf of
his client, stating that this "information is absolutely
essential in order for us to properly proceed with our
petition for remission under Title 19, Sec. 1607, et seq,"
(Rashid Docl. Ex. 9.).”
On January 21, 1998, the DEA sent a letter to
Mr. Soller to address the issues raised in his January 8,
1998 letter. The DEA stated its belief that the notice of
seizure provided to Rodriguez comported with constitutional
due process standards. The DEA indicated that "the currency
in question was seized because there was probable cause
to believe [it] was furnished or intended to be furnished
in exchange for acontrolled substance; was traceable to such
an exchange; or was intended to facilitate a violation of
A7
21 U.S.C. §§ 801-890 (Subchapter 1 of the Controlled
Substances Act)." (Rashid Decl. Ex. 12.) The DEA
further advised, however, that it was not required to trace
seized currency to a particular transaction. Finally, the DEA
commented on Rodriguez's counsel's representation that he
intended to file a petition for remission and/or mitigation.
Noting that Rodriguez appeared to challenge the merits of
the seizure, the DEA cautioned that in reviewing a petition
for and/or mitigation, the reviewing official must presume
a valid forfeiture and therefore cannot consider the
sufficiency of the evidence supporting that forfeiture.
Rodriguez never filed a petition for remission and/or
mitigation, nor did he file a claim and post a bond with
the DEA. Instead, on February 18, 1998, Rodriguez
commenced the instant action by filing a motion for the
return of the currency pursuant to Fed. R. Crim. P. 41(¢),
which provides, in part:
A person aggrieved by an unlawful search and
seizure or by the deprivation of property may move
the district court for the district in which the
property was seized for the return of the property
on the ground that such person is entitled to
lawful possession of the property. Fed. R. Crim.
P. 41(e). :
Rodriguez contends that the DEA unlawfully seized
the subject currency in violation of his constitutional rights
under the Fourth Amendment. The 20-day period for filing
a claim and bond with the DEA expired on January 28,
1998. The 30-day period for Filing a petition for remission
or mitigation expired on February 7, 1998.
|
i
i
“A8
This action was filed on February 12, 1998.
On February 23, 1998, the DEA declared the subject currency
forfeited.
Discussion
The government has moved to dismiss this action
for lack of subject matter jurisdiction. The government
contends that under controlling Second Circuit precedent,
once the DEA has commenced administrative forfeiture
proceedings, a court's jurisdiction to review that forfeiture
is limited to a consideration of whether the agency has
adhered to the appropriate procedural safeguards. Asserting
that no procedural deficiencies exist in this case, the
Government concludes that the Court should dismiss this
action.
Rodriguez advances three arguments in opposition
to the government's motion. FFirst, he argues that the
administrative proceedings did not divest the Court of its
inherent equitable authority to entertain the pending Rule 41(e)
motion and consider the merits of the forfeiture. Second,
and in the alternative, he contends that the administrative
process leading to the forfeiture of the subject currency was
procedurally deficient. Finally, Rodriguez submits that the
DEA improperly declared a forfeiture after he had declared
his interest in the subject property, albeit not by filing a
claim or a petition for remission and/or mitigation.
A. __ Statutory and Regulatory Framework
The DEA seized the subject currency on the stated
basis that it had probable cause to believe the currency was
subject to forfeiture pursuant to 21 U.S.C. §881(a). That
section provides, in relevant part, as follows:
A9
The following shall be subject to forfeiture to the
United States and no property right shall exist in
CN <0 i ces (6) All moneys . .. furnished or
intended to be furnished by any person in
exchange for a controlled substance or listed
chemical in violation of this subchapter, ll
proceeds traceable to such an exchange, and ll
moneys ..... used or intended to be used to
facilitate any violation of this subchapter, except that
no property shall be forfeited under this paragraph, to
the extent of the interest of a owner, by reason of any
act or omission by that owner to have been committed
without the knowledge or consent of thatowner.
21 U.S.C. §881(a) statutory provisions governing the seizure
and disposition of property for violations of the customs
laws also apply to seizures pursuant to §881. See 21
U.S.C. § 881 (d).
Because the subject currency in this case totaled
less than $500,000, tho DEA was permitted to initiate
administrative, as opposed to judicial, forfeiture proceedings.
The statute governing administrative forfeiture required the
DEA, upon seizure, to
cause a notice of the seizure of [the seized
property] and the intention to forfeit and sell or
otherwise dispose of the same according to law to
be published for at least three successive weeks
in such manner as the Secretary of the Treasury
may direct. Written of seizure together with
information applicable procedures shall be sent to
each party who appears to have an interest in the
seized article.
i
}
Al0
19 U.S.C. §1607(a). The publication and delivery of these
notices constitutes the commencement of administrative
forfeiture proceedings. See Onwubiko v. United States, 969
F.2d. 1392, 1398 (2d. Cir., 1992).
Upon the commencement of administrative
proceedings, a person claiming an interest in the seized
property has two options. First, the claimant may file a
“petition for remission or mitigation of forfeiture.” See 21
C.E.R. § 1316.79. Such a petition is a purely administrative
remedy, addressed to the Administrator of the DEA. See
id. § 1316.79(a). It must be filed within 30 days of receipt of
the notice of seizure. See id. § 1316.80(a).
Claimants may also pursue a judicial remedy,
either in addition to or instead of the administrative
remedy. The claimant "May at any time within twenty days
from the date of the first publication of the notice of seizure
file... ..a claim stating his interest [in the property]."
19 U.S.C. § 1608.‘ The claim must be accompanied by a
bond with approved sureties. See id. If “no such claim is
filed or bond is given” within the allotted 20 days, the
property is declared forfeited. See 19 U.S.C. § 1609(a); 21
C.F.R. § 1316.77(a). If an appropriate claim and bond are
received, the DEA Asset Forfeiture Section transmits
information concerning the seizure to the U.S. Attorney
for the relevant district for the purpose of instituting
condemnation proceedings. See 19 U.S.C. § 1608; 21 C.F.R. §
1316.78.
Rodriguez's chosen course of action was neither
the prescribed judicial remedy nor the administrative remedy.
4 In this case, due to a delay, the DEA expressly allowed
20 days from receipt of the notice rather than from the first date of
publication.
All
B Sublocs Matter Joriadict he Merits of the Forte:
The central issue raised by the government's
motion is whether there exists a jurisdictional basis for the
Court to review merits of the forfeiture at issue. The
government maintains that the commencement of an
administrative forfeiture proceeding divests a district court of
subject matter jurisdiction over the merits of a forfeiture.
Rodriguez responds that the Court's inherent equitable
jurisdiction, as embodied in Fed. R. Crim. P. 41(),
provides an independent jurisdictional basis for the Court to
reach the merits of his claim that the DEA seized his
currency in violation of the Fourth Amendment.
It is the law of this circuit that "an administrative
forfeiture ordinarily removes the subject matter of the action -
the property or res - from the district court and thereby deprives
the court of jurisdiction to review administrative decisions
once the administrative process has begun." Borero v. DEA,
111 F.3d 301, 304-05 (2d Cir. 1997) (citing Onwubiko
v. United States, 969 F.2d. 1392, 1398 (2d. Cir., 1992).; see
also Toure v. United States, 24 F.3d 444, 446 (2d Cir.
1994); United States v. One 1987 Jeep Wrangler Auto. VIN
#2BCCL8132HBS12835, 972 F.2d. 472, 479 (2d Cir. 1992);
Omoregie v. United States, No. 94 CV 2098 (JG) 1995 WL
761848, at *2 (E.D.N.Y. Doc 20, 1995).
Review of a completed forfeiture "is limited to
determining whether the administrative process, either in the
way it was carried out in the particular instance or in the
procedural rules themselves, failed to afford the petitioner due
process.” Omoregie v. United States, 1995 WL 761848, at *2;
See also Lopes v. United States, 862 F. Supp. 1178, 1185
(S.D.N.Y. 1994). Accordingly, where a forfeiture proceeding
has been properly conducued, a plaintiff is not entitled to
Al2
arr :
have a district court review the merits of the seizure. This is
true whether the review is sought pursuant to Rule 41(€)
of the Federal Rules of Criminal Procedure or under what
has been described as the court of "civil equitable"
jurisdiction. See Mullins v. United States, _No. 96 Civ.
0241 (MBM), 1997 WL 55946, at *2 (S.D.N.Y. Feb.
11, 1997); see also Shaw v. United States, 891 F.2d 602,
603 (6 Cir. 1989).
The cases cited by Rodriguez do not compel a
different result. Even assuming that c could be
appropriately invoked as a sources of jurisdiction to address
the propriety of the seizure, it would not be appropriate to
exercise that jurisdiction here. Central to the exercise of
equitable jurisdiction is a showing that there is no adequate
remedy at law. See Vv i
Justice, 673 F.Supp.660, 664 (E.D.N.Y. 1987) (stating that
"the adequacy of movant's remedy at law is most
significant” for determining whether court should exercise
anomalous jurisdiction); i Vv
of Gold, 95 MAG. 2167 (NRB), 1995 WL 758762, at*1
(S.D.N.Y. Dec. 22, 1995) (“[A] court should not find
‘anomalous’ jurisdiction when the movant has an available
statutory or civil remedy to contest ownership of the
property and thc lawfulness of the seizure.”). Citing this
principle, courts in this circuit consistently have declined to
exercise anomalous jurisdiction over a Rule 41(e); motion
filed after the commencement of administrative forfeiture
proceedings. See, i
Gold, WL 758762, at *1 (noting thata Rule 41(¢) motion
generally should be dismissed when a civil forfeiture
proceeding is pending” and declining to exercise anomalous
jurisdiction over Rule 41(e) motion); Boyd v. United States
ice, 673 F.Supp. at 663 (“‘Anomalous'
jurisdiction is inappropriate when no criminal proceedings
are pending at the time the motion is filed and when the
Al3
movant has a readily available statutory remedy to contest
ownership of property and the lawfulness of the seizure, as
well as other available civil remedies."). The rationale
underlying these decisions is that, once the administrative
proceedings are commenced, the statute governing the filing
of a claim and bond provides an adequate legal remedy.
It is not a distinguishing feature that the final
declaration of forfeiture in this case took place after
Rodriguez filed his Rule 41(e) motion. Equity generally
will not come to the aid of a litigant who chooses not to
pursue available legal avenues for relief. See $6470.00 v.
United States, 901 F.2d 1540, 1545 (11th Cir. 1990) ("It
is inappropriate for a court to exercise equitable jurisdiction
to review the merits of a forfeiture matter when the petitioner
selected to forgo the procedures for pursuing an adequate
remedy at law."); Shaw_v. United States, 891 F.2d 602,
603 (6Cir. 1989) ("Here [the claimant] ignored [the
administrative forfeiture procedures] and sought to use the
equitable remedy rather than pursuing the legal remedy.
Under standard equity doctrine, where there is an adequate
remedy at law it must be pursued."); United States One
# + 7263, 719 F.
Supp. 595,599 (E.D. Mich. 1909) ("[The claimant] has
a legal remedy available to him and seemingly has chosen
not to use it..... well ‘settled general principles of equity
preclude exercise of equity jurisdiction to accomplish what
could have been accomplished at law."). At oral argument
on the government's motion to dismiss, Rodriguez’s counsel
conceded that Rodriguez's failure to pursue his legal remedy
of filing a claim and bond during the pendency of the
administrative proceeding was a calculated decision.
(Transcript at 5, 19.}
The exercise of anomalous or equitable jurisdiction
over Rodriguez ‘s Rule 41(e) motion to reach the merits of
Al4
the forfeiture proceeding is not appropriate in this case.
Rodriguez was fully aware of the administrative forfeiture
proceedings against the subject currency, and the mechanisms
for challenging that forfeiture, yet he chose not to pursue
his legal remedy by filing a notice of claim and posting a
bond. ° Rodriguez has offered no compelling justification for
his admittedly intentional inaction or credible showing that
his legal remedies were inadequate.
Rodriguez asserts that a civil forfeiture action
would taint his reputation and that if he had filed a clalm
and posted a bond, he would have no means of insuring
that the government would commence and pursue the
forfeiture action expeditiously. The fact that a litigant may
have found an adequate legal remedy undesirable for some
reason does not entitle that litigant to equitable relief.
Further, the reasons proffered by Rodriguez here do not even
suggest that the statutory remedy was inadequate. As to
his first reason, the Court fails to understand how the
“taint” to Rodriguez's reputation is less severe in a Rule
41(e) action than it would have been in a judicial
forfeiture action. As to his second reason, the Court
notes that the government is constrained not only by the
5-year statute of limitations governing forfeiture proceedings
but also by the Due Process Clause in its discretion as to
the commencement of forfeiture actions. See United States v.
$8,850, 461 U.S. 555 (1983); See also Creative Electric Inc.
v. United States, No. 95-CV-0302 (RSP/GJD), 1995 WL
5 At oral argument, Rodriguez’s counsel was asked
whether he made a “conscious and deliberate choice” not to pursue
the statutory route for judicial review. Counsel replied:
“Yes... we made a conscious effort to proceed pursuant to Rule
41(e) (Transcript at 5.) Counsel also indicated that he “understood
the alternative course.” Of pursuing the statutory remedies (id. at
19.).
Al5
494002, at 6-7(N.D.N.Y. Aug. 16, 1995) (directing
DEA to initiate judicial proceeding after delay of 16
months).
The two principles cases relied upon by Rodriguez
do not require a different conclusion. In Camacho _v.
United States, 645 F. Supp. 725 (E.D.N.Y. 1986), the
court found that the claimant's failure to pursue her legal
remedies pursuant to the administrative forfeiture proceedings
did not preclude consideration of a post-forfeiture Rule
41(e) motion. The court reasoned that "[e]ven if plaintiff
waived her rights under §1608 by failing to post a bond
in the required amount, such a waiver does not prejudice
her right to move for relief under Fed. . Com #.
41(e). The two remedies are distinct and the plaintiff may
choose either one." Id. at 727. In Camacho, as in this
case, no criminal action was commenced or threatened
against the claimant. See id. at 726-27.
This Court concludes that the Camacho decision
was wrongly decided and declines to follow it for a
number of reasons. First, the Camacho court itself never
analyzed the jurisdictional basis for its consideration of the
Rule 41(e) motion in the pending civil action or addressed
the equitable principles governing the relief sought. More
importantly, the Camachio decision has been undermined by
the more recent Second Circuit decisions in One 1987 Jeep
Wrangler and Onwubiko, which rejected reliance on Rule
41 (e) in the absence of a criminal proceeding. Even prior
to those more recent decisions, courts have refused to
follow Camacho. See United States v. One Black Buick Auto,
725 F. Supp. 148, 150 (W.D.N.Y. 1989) (noting that
Camacho had been expressly rejected in United States v.
$83,310, 851 F.2d 1231, 1233 (9th Cir. 1988)). Given
the lack of analysis in Camacho, the contrary Second
Circuit precedent and its specific rejection by other courts, the
Al6 :
Court does not find it persuasive authority.°
Another case relied upon by Rodriguez is the
Tenth Circuit's decision in Floyd v. United States, 860 F.2d
999 (10th Cir. 1988). The Court notes initially that it is
not bound by a decision from the Tenth Circuit. In any
event, Floyd is factually distinct. In Floyd, the claimant
filed a Rule 41(e) motion before the commencement of
administrative forfeiture proceedings against the subject
property. After the filing of the Rule 41(e) motion on
September 18, 1987, the government indicated that
administrative proceedings would be commenced with the
publication of notice on or about October 21, 1987. Such
publication did not occur and the court held a hearing on
the Rule 41(e) motion on November 23, 1987. Notice
was published on December 2, 1987, and the court entered
its order on December 30, 1987.
The Court of Appeals for the Tenth Circuit found
that the district court did not abuse its discretion by
retaining jurisdiction over the Rule 41(e) motion after the
publication of notice. The court reasoned that at the time
of the hearing, no administrative proceedings had been
commenced, so the claimant did not hawe an available legal
remedy under the forfeiture laws. The same cannot be said
here, since Rodriguez filed his Rule 41(e) motion
subsequent to the initiation of the administrative proceeding.
He had a legal remedy available to him under the
forfeiture laws in the then-pending administrative proceeding.
6 The Court also notes that no district court in the Second
Circuit has relied upon Camacho for the propositions cited by
Rodriguez since the Second Circuit issued its 1992 decisions in
One 1987 Jeep Wrangler and Onwubiko.
Al7
In sum, the Court finds that Rule 41(e) does not
provide a basis, in this case, for subject matter
jurisdiction over the merits of the subject forfeiture.
Rodriguez chose, for apparently misguided strategic purposes,
to forego his legal remedies in the administrative
proceeding, and equity will not now come to his aid.
© Rodrigues’s Procedural Clai
Even though the Court lacks jurisdiction to
consider the merits of the subject forfeiture, the government
concedes that the Court has jurisdiction to consider the
procedural sufficiency of the forfeiture proceedings against
the subject currency. See Onwubiko
969 F.2d 1398 (" {I}f an administrative forfeiture is
procedurally deficient, the court has jurisdiction to correct the
deficiency.”); Valencia-Romero_v. United States, No. 97
CV 6723, 1998 WL 938949, at*2 (E.D.N.Y. Nov. 18,
1998) (same).
Rodriguez contends that both the service of the
notice of seizure and the notice itself failed to comport
with the requirements of procedural due process. He cites
several purported defects in this regard. For instance, he
notes that: (1) the DEA originally sent notice to the wrong
attorney; (2) the DEA never personally served him; (3)
publication of notice preceded service of notice to his
current attorney; (4) the twenty days afforded did not
provide adequate time for his attorney to contact him and
prepare aclaim; and (5) the notice did not set forth the
facts justifying the forfeiture such that he could make an
informed choice with regard to the remedy to seek.
The court does not find any of these arguments as
to the propriety of notice persuasive. First, the Court is
not moved by Rodriguez ‘s arguments concerning whether
A18
the notice was delivered to the correct attorney or to him
personally. The DEA sent multiple notices of seizure, one
of which unquestionably was received by Rodriguez's
present attorney in this matter. Further, the last notice sent
to Rodriguez, in care of his counsel, expressly provided
that his time to respond would not begin until his receipt of
the notice, thus making any previous delays or inadequacies in
service irrelevant to the due process question. His daughter
also received such a notice on one, and perhaps two,
occasions. All that is required is that the DEA deliver
notice “reasonably calculated" to apprise interested parties
of the administrative action. See United States v. Cruz,
No. S2 97 Ct. 54 (RPP), 1998 WL 326732, at *2
{S.D.N.Y. June 19, 1998) (quoting Weigner v. City of
New York, 852 F.2d 646, 649 (2dCir. 1988)); See also
Bye v. United States, 105 F.3d 856, 857 (2d Cir. 1997)
(holding notice to claimant's attorney in pending criminal
matter to be sufficient). Further, due process is clearly
satisfied when, as here, actual notice of administrative action
is undisputed. See One Jeep Wrangler, 972 F.2d at 482, Lopes
v. United States, 862 F.Supp. 1178, 1187-88 (S.D.N.Y. 1994).
Rodriguez also has no valid objection to the
content of the notice.. The notice in question set forth in
understandable terms the nature of and authority for the
forfeiture proceedings and the means by which Rodriguez
could (a) challenge the forfeiture and/or (b) seek
remission and/or mitigation. Courts generally have not
required more. See e.g. Sterling v. United States, 749 F,
Supp. 1202, 1210-33 (E.D.N.Y. 1990) (finding that
notice worded similarly to notice at issue in this case
comported with due process standards). Rodriguez
provides no legal authority support his position that the notice
must set forth the facts supporting the determination that there
was probable cause to seize the funds.
Al9
D. Rodriguez's E Ps in the P
Finally, Rodriguez asserts that the DEA improperly
forfeited the currency after he had clearly expressed an
interest in the property. Rodriguez notes that his attorneys
were in contact with the DEA concerning the return of his
property beginning almost immediately after the seizure.
Furthermore, the January 8, 1998, letter from Rodriguez's
attorney to the DEA expressly stated Rodriguez's position
that the funds in question were not related to any drug
offense. Finally, after the time period for filing a claim and
posting bond with the DEA expired but before the declaration
of forfeiture, Rodriguez filed the pending 41(e) motion
seeking the return of his property. Rodriguez submits that
these actions and circumstances sufficiently apprised the
DEA of his interest in the subject currency The DEA's
subsequent forfeiture of the currency with knowledge of
this interest, he submits, was improper. The Court has
jurisdiction to consider this argument to the extent that it
arguably relates to the procedural sufficiency of the
administrative forfeiture and not to the merits of the seizure
itself.
The Second Circuit has recognized that
administrative forfeiture is appropriate only in cases where
the seized property goes unclaimed. Indeed, administrative
forfeiture is, in reality, a non-proceeding -- it is merely
the consequence of no one having come forward to claim
the property seized or contest its forfeitability." United
States v. Idowu, 74 F.3d 387, 394 (2d Cir. 1996). Consistent
with this view, the Second Circuit has directed that courts
should construe forfeiture claims liberally, such that
“technical noncompliance with the procedural rules
governing the filing of forfeiture claims will be excused
where there is a sufficient showing of interest in the
property.” One 1987 Jeep Wrangler, 972 F.2d at 481.
A20
- The Court notes initially that the letter written by
Rodriguez's counsel to the DEA was insufficient to put the
DEA on notice that Rodriguez intended to pursue a judicial
remedy to recover the subject currency. At most, it
indicated to the DEA that he was considering the assertion
of a property interest by pursuing the administrative remedy
of a petition for remission or mitigation.’ The pursuit of
such a remedy does not end administrative forfeiture
proceedings. The DEA responded promptly to Rodriguez's
letter, and the response was delivered well within the
20-day period during which he might have filed a claim
and_ bond. Further, the DEA’s response reminded
Rodriguez of the 20-day filing period forclaims, suggesting
that the DEA did not interpret counsel's letter as a claim
or other clear assertion of Rodriguez's statutory right to
judicial review.
Because the January 8, 1990, letter was insufficient
to put the DEA on notice of Rodriguez's asserted interest, the
question becomes whether the filing of this action, after
the 20-day period had expired, should have prevented the
forfeiture of the subject currency.
Rodriguez cites several case in which courts have
held that the DEA improperly forfeited property because
the claimant in question had asserted his or her interest in
the property, albeit not in a form compliant with the
procedural requirements. In One 1987 Jeep Wrangler, for
example, the claimant filed a notice of claim before the
commencement of the administrative forfeiture and failed to
7 Indeed, the letter does not refer to the possibility of filing
a claim and bond at all, and refers only to the possibility that
Rodriguez would, in the future, by filing a petition for remission or
mitigation. (Rashid Decl. Ex. 9 at 2.)
A21
post a bond. The DEA had decided to treat the filed
notice of claim as relating to a prior notice of seizure that
had been abandoned by the DEA. The Court of Appeals
for the Second Circuit found this decision to be arbitrary.
Although the Court of Appeals was "troubled" by the
claimant's failure to posta bond, it concluded that "the
import of the claim is that [the claimant] took affirmative
action to protect this rights in the defendant Jeep. Id. at 481.
In Muhammed v. DEA, 92 F.3d 648 (8th Cir.
1996), the claimants filed an action for the return of their
property before the commencement of the administrative
forfeiture proceedings. When the DEA subsequently instituted
such proceedings, the claimants did not file a claim and
post bond. Rather, they amended their complaint to include
the notice of seizure, and then sent copies of the amended
complaint, together with affidavits, receipts anda cover
letter requesting release of the property to the DEA.
The DEA ireated this submission as a petition for
remission and/or mitigation and forfeited the property. The
Court of Appeals for the Eighth Circuit found the forfeiture
to be void for want of due process. Specifically, the
court reasoned that the notice did not adequately explain
the effect of an administrative forfeiture proceeding on a
pending action for the return of property. The court
emphasized that the claimants had put the DEA on notice
of their interest in the property and of their confusion
regarding the requirements for pursuing their claim
administratively.
Finally, Rodriguez cites the Sth Circuit's decision
in Scarabin v. DEA, 919 F.2d 337 (SthCir. 1990). In
Scarabin, the claimant improperly filed a motion for
expedited release property in response to the DEA's notice
of seizure. The DEA denied the motion and, after the
A22
claimant did not file a claim and bond or a petition for
remission and/or mitigation, it forfeited the property. Noting
that the claimant's motion included essentially all of the
information required in a petition for remission and/or
mitigation, the court concluded that the DEA should be
required to review the merits of his petition.
The cases relied upon by Rodriguez are distinct
from the instant case in one important respect - in each of
the cited cases, the deficiency in the claimant's chosen
course of action was a result of a mistake, and not of a
conscious decision to pursue another remedy with no
attempt to adhere to the statutorily prescribed administrative
regime. For instance, in One 1987 Jeep Wrangler, the court
noted that it was "troubled by the claimant’s failure to file
a bond. See 972 F.2d at 481. However, the court found
it "conceivable that the claim was intended as either a
claim for judicial intervention or as a petition for remission
and/or mitigation." Id. In the present case, however,
Rodriguez indicates in his papers and claimant's counsel
indicated at oral argument that claimant's course of action
in the administrative proceeding was expressly not an
attempt to seek remission and mitigation, or an attempt to
invoke the statutory provision for judicial review. (Transcript
at 5,19.) Under the facts of this case, it is not
“conceivable,” therefore, that Rodriguez's actions were
attempts to pursue the legal remedies provided by statute.
Additionally, in One 1987 Jeep Wrangler, the court construed
the claim filed by the claimant as pertaining not to the
first seizure of the claimant's property, as to which it
would be untimely but to the second seizure of the claimant's
property, as to which the Court decided the claim was not
untimely. Here, Rodriguez clearly filed his action after
the 20-day period for filing claims had expired.
A23
In Muhammed, as in this case, the claimant
pursued a Rule 41(e) motion instead of filing a claim and
bond. However, in Muhammed there was no conscious
decision to forego the claim and bond procedure. Rather,
the claimant's failure to file the “claim and bond” was an
error, . . . , an understandable one brought on by the
inadequacies of the DEA's notice." 92 F.3d at 652. The
Muhammed court further noted that "equity is sometimes
tolerant of errors." Id. Here, onthe contrary, Rodriguez
intentionally chose not to pursue the statutory claim
remedy, despite clear notice of the proper procedures for
pursuing that remedy. Equity may be tolerant of errors,
but it is not tolerant intentional decisions not to pursue legal
remedies.
Finally, the Scarabin case also involved a distinct
factual scenario. In that case, the claimant filed, with
the DEA, a motion for expedited release of certain seized
property, See 919F.2d at 338. The DEA "correctly
denied” the motion because expedited release is appropriate
only for funds seized for possession of personal use
quantities of drugs, and Scarabin's money was seized as
purported proceeds of drug sales." Id The court found that
the DEA should have considered the claimant's motion to
be a petition for remission or mitigation, because it
"contained essentially all of the information required for"
such a petition. See Id. at 339. The claimant in Scarabin
simply made an error by seeking a kind of relief within
the administrative scheme that was not available to him.
Unlike the instant case, the claimant in Scarabin did not
make a conscious, strategic decision to forgo remedies
known to be available to him in order to pursue another
course of action. Also, the Scarabin court did not treat the
claimant's submission as constituting a basis for judicial
relief, but merely directed that it be treated as a petition
for relief within the administrative regime.
A24
Rodriguez here asks the court to do more.
Rodriguez chose to pursue a remedy that turned
out to be unavailable to him.’ Despite being on full notice
of the two statutorily authorized remedies for wrongful
seizures, he decided to do something else.” Nothing that
the DEA did in relation to this administrative proceeding
violated any provision of the forfeiture laws. The DEA
thus properly forfeited the subject currency because no party
had come forward within the statutorily-defined period to
properly assert an interest in it or to ask to pursue the
issue in a judicial forum.
Conclusion
For the reasons discussed above, the Court grants
the government's motion to dismiss. This case is closed.
—"
SO ORDERED.
Dated: Brooklyn, New York
August 12, 1999
8 The Court notes that Rodriguez may have other remedies
available to him. See v i i
92 F.3d 648, 654 n.7) (8" Cir. 1996), but expresses no opinion as
to any potential merit of any claims not presented here.
9 Even if the Rule 41(e) motion could be deemed an
appropriate replacement for the claim and bond procedure,
Rodriguez filed this action 11 days after the 20-day period for
filing a claim and bond had expired. According to the regulation,
the property became forfeitable at the expiration of the 20-day
period, or on January 28, 1998. See 19 U.S.C. § 1609(a); 21
_ CEFR. § 1316.77(a). The DEA received no indication that
Rodriguez was asserting his right to a judicial remedy during that
20-day period. -
A25
APPENDIX B
JUDGMENT OF THE ;
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
xX
In re Seizure of Certain Property
including $370,000 more or less
on November 7, 1997
98 CV 1026 (CBA)
A Memorandum and Order of the Honorable Carol B. Amon,
United States District Judge, having been filed on August 13,
1999; granting the government’s motion to dismiss for lack of
subject matter jurisdiction pursuant to Fed. R. Civ. P.
12(b)(1); it is
ORDERED and ADJUDGED that the government's
motion for dismiss is granted.
. Dated: Brooklyn, New York
August 13, 1999
ROBERT C. HEINEMANN
Clerk of Court
By: /s/
James Giokas, Chief Deputy Clerk
A26
APPENDIX C
COURT OF APPEALS
SECOND CIRCUIT
LUIS ALBERTO RODRIGUEZ,
Petitioner-Appellant,
Vv.
UNITED STATES DEPARTMENT OF JUSTICE and
DRUG ENFORCEMENT ADMINISTRATION,
Respondents-Appellees.
x
No. 99-6337
SUMMARY ORDER
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,
ADJUDGED AND DECREED that the judgment al said district
court be and it hereby is AFFIRMED.
Petitioner-appellant Luis Rodriguez appeals from an
August 13, 1999 judgment of the United States District Court
for the Eastern District of New York (Amon, J.), dismissing the
action for lack of subject matter jurisdiction pursuant to
Fed.R.Civ.P. 12(b)(1). On appeal, Rodriguez argues: (1) that the
A27
district court should have entertained Rodriguez's challenge,
pursuant to Fed.R.Crim.P. 41(e), to the legal sufficiency of the
currency seizure; (2) that forfeiture of the currency was
improper after Rodriguez expressed an interest in the property,
and (3) that the administrative proceedings were procedurally
flawed.
On November 7, 1997, Rodriguez and his daughter
arrived at Laguardia Airport in New York City in order to
embark on a flight to Miami. After passing through security,
plaintiff was stopped and questioned by Port Authority
detectives and Brian Fitzpatrick, Special Agent in the Drug
Enforcement Agency ("DEA"). The investigation revealed that
Rodriguez was carrying $366,280 in U.S. currency, largely in
small bills. Rodriguez, who speaks only Spanish, was
questioned through an interpreter. Rodriguez told investigators
that the cash was related to his jewelry business, but was unable
to give specifics regarding the business. Plaintiff and his
daughter were permitted to leave, but Special Agent Fitzpatrick
seized the currency. On November 10, 1997, a trained police
dog reacted positively to the presence of narcotics on the bills.
On December 15, 1997, the DEA sent three Notices of
Seizure by certified mail: one to plaintiff which was returned to
the DEA as undelivered, one to Rodriguez's daughter which
appears to have been received, and one to Rodriguez's first
attorney which was delivered. Beginning December 24, 1997,
the DEA published notice of the seizure for three successive
weeks in USA Today.
On January 2, 1998, the DEA sent another Notice of
Seizure to plaintiff's new attorney, Carl Soller. A cover letter
indicated that although the notice stated that all parties have 20
days from the first date of publication in USA Today, the DEA
would provide Rodriguez until January 28th to respond, 20 days
from receipt of the notice sent to Soller. On January 8, 1998,
A28
Soller argued, by letter, that the notice was deficient in several
respects. On January 21, 1998, the DEA responded with a letter
stating that a federal court had deemed the content of the notice
constitutionally sufficient.
On February 12, 1998, approximately two weeks after the
DEA deadline, Rodriguez filed in district court a motion for -
return of property pursuant to Fed.R.Crim.P. 41(e). On February
23, 1998, the DEA formally processed forfeiture of the currency
to the United States. On March 20, 1998, the government
moved to dismiss the 41(e) action, and on August 12, 1998, the
district court dismissed the action for lack of subject matter
jurisdiction pursuant to Fed.R Civ.P. 12(b)(1).
This court reviews the grant of dismissal for lack of
subject matter jurisdiction under Fed.R.Civ.P. 12(b)(1) de novo.
See v. New 't
Congress has authorized the DEA to seize money furnished
or intended to be furnished in exchange for a controlled
substance. See 21 U.S.C. § 881(a)(6). If the currency is less
than $500,000, the DEA may proceed administratively. See 19
U.S.C. § 1607; Boero v. Drug Enforcement Admin.. 111 F.3d
301, 304 (2d Cir.1997). An administrative forfeitu
commences with the publication of. notice. See 19 U.S.C. §
1607. Within 20 days of the first publication of notice, the
claimant may contest the forfeiture by filing a claim and a cost
bond with the DEA. See 19 U.S.C. § 1608; Boero, 111 F.3d at
304. If the claimant fails to file a claim and cost bond,
administrative forfeiture occurs by default. See 19 U.S.C. 8
1609; Boero, 111 F.3d at 304.
Aside from limited exceptions not relevant here, see
federal courts have no jurisdiction to
review the merits of an administrative forfeiture proceeding
A29
outside of the claim and bond procedure. See US. v. One 1987
Jeep Wrangler, 972 F.2d 472, 480 (2d Cir.1992). The filing of
a claim and bond stops the administrative procedure and
compels the DEA to refer the matter to the relevant United
States Attorney, who is required to initiate judicial forfeiture
proceedings. See Boero, 111 F.3d at 304-05; see also One 1987
Jeep Wrangler, 972 F.2d at 479. In judicial forfeiture
proceedings the plaintiff can challenge the legality of the
seizure. See, e.g., Uni Vv
Currency, 920 F.2d 159, 162-63 (2d Cir.1990). Because
Rodriguez failed to file a claim and cost bond by January 28th,
the district court could not adjudicate the merits of the
underlying seizure and properly dismissed the action for want
of subject matter jurisdiction.
On appeal, Rodriguez argues that the district court should
have entertained his challenge to the legality of the currency
seizure based on his claim that, at the time of the seizure,
probable cause was lacking. He further contends that the 41(e)
motion was the only procedure in which he could challenge the
existence of probable cause at the time the seizure occurred.
However, the law is clear that "once the administrative process
has begun, the district court loses subject matter jurisdiction to
adjudicate the matter in a peripheral setting such as a Rule 41(e)
motion." One 1987 Jeep Wrangler, 972 F.2d at 479. The law is
equally clear that even if Rodriguez had timely filed a claim and
cost bond, thus enabling the district court to review the merits
of the seizure, the government, during the judicial forfeiture
proceeding, could proffer evidence gathered after the initial
seizure to prove that it had probable cause at the time of the
initial seizure. See $37,780 in United States Currency, 920 F.2d
at 163-64. Thus, Rodriguez is correct that the claim and bond
procedure precludes an evaluation of probable cause that
excludes circumstances beyond those that existed at the time of
the seizure. To be sure, the effect of the procedural setting
which this case presents is that Rodriguez is unable to mount a
A30
challenge to the seizure based on the probable cause
determinants as they existed at the time of the seizure. But the
fact that the appropriate rules, properly applied, yield a result
not to Rodriguez's liking is not a reason for us to engage ina
course of remedial legislation. His remedy, if any, lies with
Congress not with the courts.
This court retains jurisdiction for the limited purpose of
determining whether administrative forfeiture was procedurally
proper. See Onwubiko v. United States, 969 F.2d 1392, 1398
(2d Cir.1992). Rodriguez argues that the notices of the seizure
were deficient in both form and content. We disagree. At the
very least, Rodriguez received actual notice of the initiation of
the forfeiture proceedings through his attorney on January 8,
1998. Moreover, as the district court noted, the notices were
also sufficient because they set forth in understandable terms the
nature and authority for the forfeiture proceedings and the
means by which Rodriguez could (a) challenge the forfeiture by
filing a claim and cost bond and/or (b) seek remission and
mitigation. See, e.g., Sterling v. United States, 749 F.Supp.
1202, 1210-11 (E.D.N.Y.1990).
We have considered Rodriguez's remaining arguments and
consider them to be without merit. Accordingly, we AFFIRM
she: jadgment of the district court.
FOR THE COURT:
ROSEANN B. MacKENCHNEE, Clerk
By:
/s/
Lucille Carr, Deputy Clerk
A31
APPENDIX D
ORDER OF THE UNITED STATES |
COURT OF APPEALS FOR THE SECOND CIRCUIT,
DATED AND FILED JULY 5, 2001
COURT OF APPEALS
SECOND CIRCUIT
LUIS ALBERTO RODRIGUEZ,
Petitioner-Appellant,
V.
UNITED STATES DEPARTMENT OF JUSTICE and
DRUG ENFORCEMENT ADMINISTRATION,
Respondents-Appellees.
x
No. 99-6337
A petition for panel rehearing and a petition for rehearing en
banc having been filed herein by the appellant Luis Alberto
Rodriguez.
Upon consideration by the panel that decided the appeal,
it is Ordered that said petition for rehearing is DENIED.
It is further noted that the petition for rehearing en banc has
been transmitted to the judges for the court in regular active
service and to any other judge that heard the appeal and that no
such judge has requested that a vote be taken thereon.
A32
FOR THE COURT:
ROSEANN B. MACKENCHNEE, Clerk
By:
/s/
Beth J. Meador
Administrative Attorney
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.