United States of America v. $229,850.00 in US Currency et al

Filing 27

IT IS ORDERED that Claimant's Motion to Dismiss 9 , converted to a Motion for Summary Judgment, is DENIED. IT IS FURTHER ORDERED this matter is set for a status conference on 10/22/14 at 9:45 a.m. before Magistrate Judge Pyle. Signed by Magistrate Judge Charles R Pyle on 9/25/14.(CKS)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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United States of America,
Plaintiff,

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vs.

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$229,850.00 in U.S. Currency,
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Defendant.
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Robert and Debra Osborne,
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Claimants.
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No. CV 13-1316-TUC-CRP
ORDER

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The Government filed this forfeiture action pursuant to 21 U.S.C. §881(a)(6).

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(Complaint (Doc. 1)). The Claimants in this case, Dr. Robert Osborne and his wife Debra

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Osborne seek dismissal pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a claim, arguing

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that the Complaint is untimely. (Doc. 9). The Magistrate Judge has jurisdiction over this

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matter pursuant to the parties’ consent. See 28 U.S.C. § 636(c). The Osbornes’ Motion to

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Dismiss came on for oral argument on July 29, 2014. (See Transcript (Doc. 26)). For the

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following reasons, the Court converts the Motion to Dismiss to a motion for summary

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judgment and denies the motion.

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BACKGROUND

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On May 9, 2013, pursuant to the execution of a search warrant by DEA, FBI, HHS,

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and IRS, a total of $229,850.00 in cash was seized from the master bedroom area of the

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Osbornes’ residence. (Complaint, ¶11). The government alleges that the cash represents

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proceeds from Dr. Osborne’s practice that was operating in violation of the Controlled

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Substances Act, 21 U.S.C. §§ 846 and 841 and is subject to forfeiture pursuant to 21 U.S.C.

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§881(a)(6). (Id. at ¶¶13, 15). Neither Dr. Osborne nor his wife, who both reside at the

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residence, were arrested or incarcerated. (Id. at ¶14).

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DISCUSSION

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The Osbornes seek dismissal of this action on the ground that the Complaint is

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untimely filed by one day. The parties disagree about when the time for the government to

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file this action began to run: the Osbornes contend it should be when the Claim was received

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by the FBI mailroom in Phoenix, Arizona, on July 10, 2013, and the government contends

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it is when the claim was received by the appropriate official at the agency, here, the FBI

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Forfeiture Paralegal Specialist at the FBI field office in Phoenix, Arizona, who received the

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Claim on July 11, 2013.

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STANDARD. The government has attached affidavits with internal exhibits to its Response

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to the Motion to Dismiss. To consider the government’s attachments, the Court must treat

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the motion to dismiss as a motion for summary judgment under Rule 56 and provide the

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parties with “a reasonable opportunity to present all the material that is pertinent to the

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motion.” Fed.R.Civ.P. 12(d); see also San Pedro Hotel Co., Inc. v. City of Los Angeles, 159

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F.3d 470, 477 (9th Cir. 1998) (represented party who submits matters outside the pleadings

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and invites consideration of same has sufficient notice that the court may use them to decide

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the motion thus requiring conversion to a motion for summary judgment). At oral argument,

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when the Court addressed the issue of conversion to a motion for summary judgment in light

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of the government’s attachments, counsel for the Osbornes stated that: “It is undisputed

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that...the agency [received the claim]...on the 10th. My argument is that’s the effective date.

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I am, at this point, not challenging that someone in that agency really did stamp it on the 11th;

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I mean that seems to be what these affidavits are saying. My position is, so what[?] It

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doesn’t matter....” (Tr. at p.12). Counsel went on to state that discovery about “how the FBI

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procedures work....” is not necessary for the legal issue presently before the Court unless the
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Court decides otherwise. (Id.).

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Summary judgment is appropriate when there is no genuine issue as to any material

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fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The party

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seeking summary judgment “bears the initial responsibility of informing the district court of

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the basis for its motion, and identifying those portions of [the record]...which it believes

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demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477

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U.S. 317, 323 (1986). The nonmoving party’s evidence is presumed true and all inferences

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are to be drawn in the light most favorable to that party. Eisenberg v. Ins. Co. of North

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America, 815 F.2d 1285, 1289 (9th Cir. 1987).

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Only disputes over facts that might affect the outcome of the suit will preclude the

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entry of summary judgment, and the disputed evidence must be “such that a reasonable jury

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could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S.

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242, 248 (1986). If the burden of persuasion at trial would be on the nonmoving party, the

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movant may carry its initial burden of production under Rule 56(c) by producing, “evidence

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negating an essential element of the nonmoving party’s claim or defense,” or by showing,

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after suitable discovery, that the “nonmoving party does not have enough evidence of an

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essential element of its claim or defense to carry its ultimate burden of persuasion at trial.”

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Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1105-1106 (9th Cir. 2000).

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TIMELINESS. The applicable forfeiture statute provides, in pertinent part that:

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Any person claiming property seized in a nonjudicial civil forfeiture
proceeding under a civil forfeiture statute may file a claim with the
appropriate official after the seizure.

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18 U.S.C. §983(a)(2)(A) (emphasis added). “Not later than 90 days after a claim has been

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filed, the Government shall file a complaint for forfeiture....” 18 U.S.C. § 983(a)(3)(A). If

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the government does not timely file a complaint for forfeiture or return the property prior to

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expiration of the 90-day deadline, then the government “shall promptly release the

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property...and may not take any further action to effect the civil forfeiture of such

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property....” 18 U.S.C. §983(a)(3)(B).

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The facts are not in dispute. On May 9, 2013, the government seized the Defendant
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currency. On June 18, 2013, FBI Headquarters mailed Notice Letters to each of the

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Osbornes informing that the forfeiture was conducted pursuant to 21 U.S.C. §881, 19 U.S.C.

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§1602-1619, 18 U.S.C. §983, and 28 C.F.R. Part 8. (Response (Doc. 16), Exh. 1A). The

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Notice Letters also informed that:
If you want to contest the seizure or forfeiture of the property in court, you
must file a claim of ownership with the FBI by July 23, 2013. The claim is
filed when it is received by the FBI Forfeiture Paralegal Specialist of the FBI
Field Division mentioned below.[1]

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(Id.) (emphasis added). Through counsel, the Osbornes submitted a Claim dated July 9,
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2013. (Response, Exh. 2A). The Osbornes sent the Claim by certified mail on July 9, 2014.
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(Id.)
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In their Answer and Motion to Dismiss, the Osbornes assert that the Claim was

received by the FBI on July 10, 2013. (Answer, (Doc. 7) p. 32 (citing tracking number);

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Motion p. 1 (citing Answer)). The government does not dispute that the Claim arrived at the
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FBI mailroom on July 10, 2013. (See Response (Doc. 16), p. 1 (indicating the FBI mailroom
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in Phoenix, Arizona, received the Claim on July 10, 2013 according to the U.S. Postal service
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tracking number indicated in the Answer)). Rather, the government contends that the Claim
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was not received by the “appropriate official” (i.e. the FBI Forfeiture Paralegal Specialist)
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until July 11, 2013. Thus, the government contends it had 90 days from that date to file the
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Complaint.
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The Claim bears a “received” date of 7/11/13 (the date appears to be hand written).
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The Osbornes were directed to
Submit all documents to this FBI Field Division:
SPECIAL AGENT IN CHARGE
FEDERAL BUREAU OF INVESTIGATION
21711 N. 7TH STREET
PHOENIX, AZ 85024
ATTN: FORFEITURE PARALEGAL SPECIALIST
TELEPHONE NUMBER: 623-466-1819
(Response, Exh. 1A).
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The Answer states the Claim was received by the FBI on “July 10, 2014.” (Answer,
p.3). Based on parties’ statements and the evidence of record, the Court presumes the date
reflected in the Answer is a typographical error.
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(Response, Exh. 2A). The government submitted the Declaration of FSA Data Analyst

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Brianne Johnson who states that she: stamped and dated the Osbornes’ Claim on July 11,

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2013; the day she stamped the Osbornes’ claim, she was undergoing training by FBI

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Forfeiture Paralegal Specialist Christa Roberts who trained her to immediately open and date

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stamp incoming claims and petitions, then give them to either Roberts or the other Forfeiture

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Paralegal Specialist; and standard procedure is to date stamp the claims on the day they are

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received from the mailroom. (Response, Exh. 2). The government also submits the

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declaration of Christa Roberts, FBI Forfeiture Paralegal Specialist, who confirms Johnson’s

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statements regarding receipt of the Osbornes’ Claim and dating it as received on July 11,

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2013. (Response, Exh. 1). Roberts goes on to state that the FBI office has a large mailroom,

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staffed by two employees, that receives mail for distribution to FBI offices in cities

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throughout Arizona. (Id.). She states that “[t]here is always a delay from receipt of mail in

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the mailroom to delivery into the forfeiture mailbox, due to required security measures and

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sorting procedures for incoming mail.... It is not unusual for mail to be placed in the

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forfeiture mailbox late in the afternoon, or the following morning. As a result, often the

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Forfeiture Unit has a receipt date the day after mail was received from the mailroom.” (Id.

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at ¶7). “Upon receipt from the mailroom, the Forfeiture Unit immediately opens and date

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stamps all incoming claims and petitions.” (Id. at ¶6).

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On October 9, 2013 (91 days after July 10, 2013 and 90 days after July 11, 2013), the

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government filed the civil complaint in this action. The Osbornes assert that the complaint

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is untimely filed pursuant to 18 U.S.C. § 983(a)(3)(A) because this civil action was filed later

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than 90 days after they filed their Claim given that their Claim was received by the FBI

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mailroom on July 10, 2013. The government counters that §983(a)(2)(A) requires that the

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claim be filed with the “appropriate official” and, therefore, the claim is not “filed” until

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received by that official, who in this case is the FBI Forfeiture Paralegal Specialist. The

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government also cites regulations indicating that with respect to a personal written notice of

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administrative forfeiture, such as that received by the Osbornes, “Appropriate official”

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means: “the office or official identified in the...personal written notice in accordance with [28
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C.F.R.] §8.9.” 28 C.F.R. § 8.2. Pursuant to §8.9, the notice must: “State the identity of the

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appropriate official of the seizing agency and the address where the claim must be filed....”

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28 C.F.R. §8.9(b)(2)(iv); see also 28 C.F.R. §8.10(a) (indicating the claimant must file a

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claim with the “appropriate official”). The government points out that the Notices sent to the

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Osbornes were clear that the “claim is filed when it is received by the FBI Forfeiture

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Paralegal of [sic] FBI Field Division....”

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Attachment 1 (Doc. 22-1), p. 2 (citing Response, Exh. 1)). According to the government,

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the claim was received by the “appropriate official” (i.e., the FBI Forfeiture Paralegal

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Specialist) on July 11, 2013 and thus, the government had 90 days from that date to file the

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complaint. (Id. at p. 2). Alternatively, if the Court determines the Complaint is late, then the

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government requests equitable tolling.

(Government’s Supplemental Authority,

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In 2000, Congress enacted the Civil Asset Forfeiture Reform Act (“CAFRA”), 18

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U.S.C. § 983, to provide increased protections for claimants. United States v. Ritchie, 342

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F.3d 903, 910 n. 1 (9th Cir. 2003); see also Stefan D. Cassella, The Civil Asset Forfeiture

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Reform Act of 2000: Expanded Government Forfeiture Authority and Strict Deadlines

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Imposed on All Parties, 27 J.Legis. 97, 122-25 (2001) (“Cassella”). “The enactment of

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CAFRA was, in part, a reaction to the perception that there was some inequity in imposing

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strict deadlines and sanctions on property owners contesting civil forfeiture actions, while

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not imposing similar deadlines and sanctions on the government. The logic was that if

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property owners were required to file claims within a fixed period of time, and were made

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to suffer consequences for failing to do so, the government should face deadlines and suffer

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consequences as well.” Cassella, at pp. 122-25. CAFRA imposed the 90-day deadline for

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the government to file a complaint set out at 18 U.S.C. §983(a)(3)(A). The 90-day time limit

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is mandatory and “[t]he requirement that the Government release the seized property where

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it fails to file a timely complaint for forfeiture is the ‘sanction’ that CAFRA imposes for such

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failure.” United States v. One 2007 Harley Davidson Street Glide Motorcycle, 982

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F.Supp.2d 634 (D.Md. 2013) (citing United States v. Wilson, 699 F.3d 789, 791 (4th Cir.

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2012)). Moreover, because forfeitures are disfavored, forfeiture laws are strictly construed
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against the government. Ritchie, 342 F.3d at 910.

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The Osbornes argue that the government “ought not be able to manipulate the

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deadlines to evade the delay reforms[]” enacted by CAFRA. (Motion, p. 5). The Court

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agrees.

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Not only must the government file a complaint no later than 90 days after receipt of

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a claim, but a claimant must file a claim within a deadline as well. See Beck v. United States,

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2011 WL 862952, *1 (D.Md. Mar. 10, 2011) (“The Government’s notice sets the deadline

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for filing a claim for seized property, subject to the restriction that the deadline may not be

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‘earlier than 35 days after the date the letter is mailed.’”) (quoting 18 U.S.C. §983(a)(2)(B));

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(See also Tr. at p. 15 (counsel for government confirming that Claimants had 35 days to file

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a claim)). Here, the Osbornes did as instructed, and mailed their Claim pursuant to the

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directions they received from the government.3 Roberts’ declaration makes clear that “[t]here

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is always a delay from receipt of mail in the mailroom to delivery into the forfeiture

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mailbox....” (Response, Exh. 1, ¶7). Yet, there is no objective means for a claimant to be

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aware of and plan for such delay. Nor did the notice letter inform the claimant to send the

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claim so that it would be timely received by the paralegal accounting for a delay of any

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specified or unspecified period. In sum, “[t]he strict construction required of [section

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983(a)(3)(A)]...is a two way street. Had claimant...been merely one day late in filing his

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claim, no doubt the government would take the position that the claim would be barred–and

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properly so.” United States v. Funds in the Amount of $314,900.00 in U.S. Currency, CV 05-

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3012 (N.D. Ill. December 21, 2005 Order, p. 4)(citing In re Forfeiture of $34,905.00 in U.S.

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Currency, 96 F.Supp.2d 1116, 1119 (D.Or. 2000) (DEA required to forfeit property where

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claimant failed to file claim within statutory period)). At oral argument, counsel for the

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Although the government relies on the regulation which identifies the “appropriate
official” as being the person specified in the notice, the regulation also states that the notice
must specify the address where the claim should be sent. 28 C.F.R. §§8.2, 8.9(b)(2)(iv).
Here, the Osbornes did as directed by mailing their Claim to the address listed in the notice.
That is all the regulation requires. The regulation does not state that the claim is filed only
when placed in the hands of the appropriate official.
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government confirmed that if a claim arrived at the mailroom on last day for filing a claim

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and did not reach the appropriate official until the following day, the claim would be deemed

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untimely. (Tr. at pp. 15, 21). Thus, “a requirement that filing occurs only when a claim

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reaches ‘the appropriate official’ would wrest from claimants all control over timely filing,

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as they could only hope that whatever mailroom procedures the agency has in place would

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get their claim to the right person by the deadline.” Beck, 2011 WL 862952 at *4. The

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District Court for the Eastern District of Michigan, in holding that the claim is “filed” when

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received by the agency rather than a specific official, persuasively found the government’s

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position to the contrary

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untenable because it would, as a practical matter, eviscerate the 90–day
limitation period imposed on the Government. For example, as the
Government acknowledged at oral argument, if a claim were received by the
seizing agency, but then sat in the mailroom for two weeks before being
delivered to the person handling the seizure, the 90–day period would be
extended for two weeks. The same would be true if the person handling the
seizure were out sick, on vacation, on maternity leave, etc.

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United States v. Funds from Fifth Third Bank Account, 2013 WL 5914101, *7 (E.D. Mich.

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Nov. 4, 2013). Therefore, the court concluded that “the better interpretation is that a claim

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is filed when it is actually received by the seizing agency.” Id. (citing United States v. Real

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Property Located at 475 Martin Lane, Beverly Hills, CA., 545 F.3d 1134, 1141 (9th Cir.

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1988) (when deciding that CAFRA authorized ex parte extensions of the 90-day deadline the

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court stated that “[i]f a claim is filed, the government then has ninety days from the date the

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claim was received by the seizing agency to file a civil complaint....”)).4 Moreover, such a

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At oral argument counsel for the Osbornes explained:
[I]n the federal system, there are dozens and dozens of federal agencies in the
forfeiture game. I believe that what CAFRA intended when they said the
“appropriate official,” was basically send it to the right agency. If DEA takes
it, you can’t send it to the Department of Justice. If the FBI takes it, and they
want the action to go through the Phoenix office, you can’t send it to D.C. or
Virginia or whatever....[T]hat makes sense, and that’s consistent with CAFRA,
that these actions start right away, and the Government has a deadline they
have to comply with.
(Tr. at p. 5).
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conclusion is in line with the protections that CAFRA sought to provide for claimants by

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imposing statutory deadlines applicable to civil forfeiture procedures:

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“[A]s a general rule, forfeitures are not favored by the law and statutes
providing for forfeitures are strictly construed. Furthermore, the Court
understands that the current statutory deadlines were meant to remedy the
pre-CAFRA reality, in which statutory deadlines for the commencement of
civil forfeiture proceedings were absent. “The enactment of CAFRA was, in
part, a reaction to the perception that there was some inequity in imposing
strict deadlines and sanctions on property owners contesting civil forfeiture
actions, while not imposing similar deadlines and sanctions on the
government.” The purpose of the ninety-day time period in section 983, then,
is to prevent the government from retaining property subject to forfeiture “for
an extended period without commencing a judicial action that will give the
claimant his day in court.”

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Funds from Fifth Third Bank Account, 2013 WL 5914101 at *10 (quoting United States v.
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$39,480.00 in U.S. Currency, 190 F.Supp.2d 929, 931-32 (W.D. Tex. 2002) (quoting
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Cassella, p. 122)) (emphasis added). Testimony before the House of Representatives
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regarding CAFRA indicated that: “if a person files a claim letter with the seizing agency, the
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U.S. Attorney would then have to file a civil forfeiture within 90 days of the receipt of the
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claim letter.” Civil Asset Forfeiture Reform Act of 1997: Hearings on Bi-Partisan Bill to
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Provide a More Just and Uniform Procedure for Federal Civil Asset Forfeitures, before the
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Committee on the Judiciary, U.S. House of Representatives, H.R. 1835, 105th Congress, 1st

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session (June 11, 1997) (statement of David B. Smith, on behalf of National Association of
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Criminal Defense Lawyers), http://www.nacdl.org/Advocacy.aspx?id=14904, or alternatively
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at, http://www.justice.gov/jmd/civil-asset-forfeiture-reform-act-2000-pl-106-185; see also
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Cassella, n. 247 (citing Smith’s testimony).
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A finding that the claim is filed when it is received by the mailroom of the agency
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where the claimant is directed to send the claim is consistent with the purpose of CAFRA.
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Such a holding creates a definite and firm deadline that is easily measurable and verifiable
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by all parties. Should the government require an extension of the 90-day deadline due to
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delay in delivery from the agency’s mailroom to the paralegal, then the government may
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request an extension upon a showing of good cause. See e.g. 18 U.S.C. §983(a)(3)(A); 475
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Martin Lane, 545 F.3d at 1141.
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Further, the government’s authority cited to support a contrary finding is not binding

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on this Court and is unpersuasive. Much of the authority cited by the government is

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premised on a 1916 decision from the Supreme Court in United States v. Lombardo, 241

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U.S. 73 (1916). The Lombardo Court addressed the issue whether the failure to file a

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document with Commissioner General of Immigration in Washington, D.C., was justiciable

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in the state where the document should have been mailed or could only be prosecuted in

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Washington, D.C. The Court stated that “[f]iling...is not complete until the document is

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delivered and received....A paper is filed when it is delivered to the proper official and by

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him received and filed....Anything short of delivery would leave the filing a disputable fact,

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and that would not be consistent with the spirit of the act[]....” Lombardo, 241 U.S. at 76

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(internal quotation marks omitted). Lombardo’s rule has become known as the physical

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delivery rule.

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Additionally, the Second Circuit, citing Lombardo, has held in the context of the filing a

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claim between private parties for products damaged in shipping, that “a paper will not be

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considered ‘filed’ until it has been delivered and received by the party with whom it is to be

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filed.” Pathway Bellows, Inc, v. Blanchette, 630 F.2d 900, 902 (2d. Cir. 1980). United

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States v. $7,696.00 in U.S. Currency, 2013 WL 1827668, *4 (N.D. Iowa April 30, 2013) and

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United States v. One GMC Yukon Denali, (CV 03-6890-JTL at Doc. 12, p. 9) (C.D. Cal. Dec.

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4, 2003), cited by the government rely on Lombardo and Pathway Bellows to conclude that

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the claim is filed when received by the Forfeiture Paralegal Specialist. However, this

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language is taken out of context. Lombardo and Pathway Bellows, Inc., decided whether the

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place or date of mailing (i.e. the mailbox rule) was the triggering event, or whether receipt

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(i.e. the physical delivery rule) was the triggering event for “filing” a document. Lombardo

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and Pathway Bellows did not address the nuance presented here concerning whether the

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document was filed when received at the designated official’s address or when the document

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actually reached that official’s hands. Unlike the cases cited by the government, this Court

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declines to extend Lombardo and Pathway Bellows to the instant facts. Consequently, the

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Complaint in this action is untimely.

See Crump v. United States, 282 B.R. 859, 862 (N.D. Ohio 2002).

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EQUITABLE TOLLING. In the event the Court finds that the Complaint is untimely, the

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government requests equitable tolling. (Response, pp. 4-5). The government cites one case

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applying the equitable tolling doctrine to §983(a)(3)(A), (id. (citing $39,480.00 in U.S.

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Currency, 190 F.Supp. 2d at 932-33)), however, neither the government nor its cited

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authority specifically discuss whether equitable tolling is available under §983(a)(3)(A) in

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the first instance. The Osbornes argue that substantive limitations are not subject to equitable

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tolling. (Reply (Doc. 20), p. 6) (citing Dada v. Mukasey, 554 U.S. 1, 18 (2008) (in

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immigration context, substantive limitations are not subject to equitable tolling)). The

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Osbornes do not explain how §983(a)(3)(A) is a “substantive” limitation precluding equitable

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tolling.

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“[W]hen a time period for filing is not jurisdictional, the requirement is subject to

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waiver, estoppel, and tolling.” Burns v. U.S., 764 F.2d 722, 727 n.3 (9th Cir. 1985) (citing

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Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 393 (1982)) cf. Holland v. Florida, 560

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U.S. 631, 645 (2010) (proceeding to determine whether equitable tolling was available under

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statute only after first noting that statute at issue was not jurisdictional)). The first question,

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then, is whether §983(a)(3)(A) is jurisdictional. The Fourth and Second Circuits have held

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that the provisions of §983 are is not jurisdictional. See United States v. Vasquez, __ F.3d.

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__, 2014 WL 3637150, *4 (2nd Cir. 2014) (“[T]he provisions of § 983 are procedural rules

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for pursuing the forfeiture of seized assets, not conditions of subject matter jurisdiction.”)

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(inner quotation marks and citation omitted); Wilson, 699 F.3d at 797 (“we conclude that the

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90-day deadline imposed in §983(a)(3) is not jurisdictional....”)). For the following reasons,

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this Court agrees.

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The Supreme Court has recently pointed out that

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“the word ‘jurisdiction’ has been used by courts ... to convey ‘many, too many,
meanings' ” and “cautioned ... against profligate use of the term.” Union Pac.
R.R. Co. v. Bhd. of Locomotive Eng'rs & Trainmen Gen. Comm. of Adjustment,
Cent. Region, 558 U.S. 67, 130 S.Ct. 584, 596, 175 L.Ed.2d 428 (2009)
(quoting Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 90, 118 S.Ct.
1003, 140 L.Ed.2d 210 (1998)). “Accordingly, the term ‘jurisdictional’
properly applies only to ‘prescriptions delineating the classes of cases
(subject-matter jurisdiction) and the persons (personal jurisdiction)’
implicating [the court's adjudicatory] authority.” Reed Elsevier [Inc., v.

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Muchnick], [599 U.S. 154, 160-61,] 130 S.Ct.[1237] at 1243 [(2010)] (quoting
Kontrick v. Ryan, 540 U.S. 443, 455, 124 S.Ct. 906, 157 L.Ed.2d 867 (2004)).
The Court confessed that “[w]hile perhaps clear in theory, the distinction
between jurisdictional conditions and claim-processing rules can be confusing
in practice,” that we should “us[e] the term ‘jurisdictional’ only when it is
apposite,” and that we should “curtail ... ‘drive-by jurisdictional rulings.’ ” Id.
at 1243–44 (quoting Steel Co., 523 U.S. at 91, 118 S.Ct. 1003); see also
Henderson [ex. Rel. Henderson v. Shields], 131 S.Ct.[1197] at 1202–07
[(2011)] (holding that a veteran's failure to file a notice of appeal within the
required 120–day period did not deprive the Court of Veterans Appeals of
jurisdiction over his claim); Reed Elsevier, 130 S.Ct. at 1249 (holding that a
copyright-registration requirement was not jurisdictional); Union Pac. R.R.,
130 S.Ct. at 598–99 (holding that a settlement-conference requirement was not
jurisdictional); Arbaugh v. Y & H Corp., 546 U.S. 500, 514–15, 126 S.Ct.
1235, 163 L.Ed.2d 1097 (2006) (holding that a Title VII provision exempting
employers with fewer than 15 employees was not jurisdictional); Kontrick, 540
U.S. at 452–56, 124 S.Ct. 906 (holding that a bankruptcy rule governing timely
amendments was not jurisdictional); United States v. Cotton, 535 U.S. 625,
630–31, 122 S.Ct. 1781, 152 L.Ed.2d 860 (2002) (holding that sentencing in
excess of a statutory maximum did not deprive the sentencing court of
jurisdiction). But see Bowles v. Russell, 551 U.S. 205, 209–10, 127 S.Ct. 2360,
168 L.Ed.2d 96 (2007) (holding that the statutory time for the taking of an
appeal from a district court decision is jurisdictional).

13

Payne v. Peninsula Sch. Dist., 653 F.3d 863, 868 (9th Cir. 2011) (en banc), overruled in part

14

on other grounds by Albino v. Baca, 747 F.3d 1162 (9th Cir.2014). See also Wong v. Beebe,

15

732 F.3d 1030 (9th Cir. 2013) (en banc) (holding that statute of limitations of the Federal

16

Torts Claims Act is not jurisdictional and may be equitably tolled), cert, granted, __ U.S.

17

__, 134 S.Ct. 2873 (June 24, 2014).5 Thus, “[t]o ward off profligate use of the term

18

‘jurisdiction’, ...[the Court has] adopted a ‘readily administrable bright line’ for determining

19

whether to classify a statutory limitation as jurisdictional.” Sebelius v. Auburn Reg’l. Med.

20

Ctr., __ U.S. __, 133 S.Ct. 817, 824 (2013) (quoting Arbaugh, 546 U.S. at 516). The Court

1
2
3
4
5
6
7
8
9
10
11

21
22
23
24
25
26
27

5

The Supreme Court has recently granted a petition for writ of certiorari in Wong.
Wong, __ U.S. __, 134 S.Ct. 2873 (June 24, 2014). Until the Supreme Court issues its
decision, this Court remains bound by the Ninth Circuit's decision. See e.g., United States v.
Frank, 956 F.2d 872, 882 (9th Cir.1992) (“In the absence of an intervening Supreme Court
decision or an Act of Congress that nullifies Ninth Circuit precedent, we must adhere to the
law of the circuit[.]”); United States v. Post, 607 F.2d 847, 851 n. 5 (9th Cir.1979) (noting
that, although the Supreme Court had granted certiorari in a similar case, the court was bound
to follow Ninth Circuit precedent until the Supreme Court ruled otherwise).

28
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1

“inquires whether Congress has ‘clearly state[d]’ that the rule is jurisdictional; absent such

2

a clear statement, we have cautioned, ‘courts should treat the restriction as nonjurisdictional

3

in character.’” Id. (quoting Arbaugh, 546 U. S. at 515–516) (other citations omitted). “This

4

is not to say that Congress must incant magic words in order to speak clearly. We consider

5

‘context, including this Court's interpretations of similar provisions in many years past,’ as

6

probative of whether Congress intended a particular provision to rank as jurisdictional.” Id.

7

(quoting Reed Elsevier, 559 U.S. at 168)).

8

Generally, district courts have “original jurisdiction” over all civil actions brought by

9

the United States, “[e]xcept as otherwise provided by Act of Congress....” 28 U.S.C. § 1345.

10

With specific regard to forfeitures, district courts have original jurisdiction of actions “for

11

the recovery or enforcement of any fine, penalty, or forfeiture, pecuniary or otherwise,

12

incurred under any Act of Congress....” 28 U.S.C. § 1355(a). Here, the government alleges

13

the Defendant currency is subject to forfeiture under the Controlled Substances Act, 21

14

U.S.C. § 881(a)(6). “This provision contemplates that such forfeitures may be accomplished

15

through either criminal or civil proceedings.” Wilson, 699 F.3d at 794 (citing 21 U.S.C.

16

§881(e)(1)). When the government “elects to proceed civilly, the procedural rules provided

17

by 18 U.S.C. §983 govern the proceeding.” Id.

18

Section 983 is entitled “General rules for civil forfeiture proceedings” and sets out,

19

for example: the timing and manner in which the government must give notice to interested

20

parties; the timing and manner in which a person with an interest in the seized property may

21

file a claim, and the 90-day deadline for the government to file a complaint. Section 983 also

22

contains provisions regarding representation of the claimant, burden of proof, the innocent

23

owner defense, motions to set aside forfeiture, proportionality, civil fines, and restraining or

24

protective orders. This Court agrees with the Fourth Circuit that “[i]n this statutory context,

25

it readily appears that the provisions of §983 are procedural rules for pursuing the forfeiture

26

of seized assets. The subject matter jurisdiction for forfeiture is conferred by 28 U.S.C. §

27

1355(a); the authority to forfeit is provided by 21 U.S.C. § 881(a)(6); and the rules of

28

procedure for pursuing a civil forfeiture are provided by 18 U.S.C. § 983.” Id. at 795; see
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1

also Reed Elsevier, 559 U.S. at 164 (registration requirement under Copyright Act was not

2

jurisdictional where, inter alia, that requirement “is located in a provision ‘separate’ from

3

those granting federal courts subject-matter jurisdiction over those respective claims”).

4

Additionally, the language of §983(a)(3)(A) further supports the conclusion that the

5

statute is not jurisdictional. Nothing in §983(a)(3)(A) setting out the 90-day deadline for the

6

filing of a complaint speaks to the court’s jurisdiction. See Henderson, __ U.S. __, 131 S.Ct.

7

at 1204 (statute was not jurisdictional where, inter alia, the relevant provision “‘does not

8

speak in jurisdictional terms nor refers in any way to the jurisdiction of the...’” court.)

9

(quoting Zipes, 455 U.S. at 394). Although §983(a)(3) employs mandatory language in

10

setting out the deadline requiring that the government “shall file a complaint...” not later than

11

90 days after the filing of the claim, 18 U.S.C. §983(a)(3)(A), “that limitation is imposed on

12

the Executive Branch of government, not as a condition of the court’s authority.” Wilson,

13

699 F.3d at 795 (emphasis in original). Further, the Ninth Circuit has applied equitable

14

tolling even when the statutory language specified that an action would be “forever barred”

15

if not filed within the limitations period. See Wong, 732 F.3d at 1038-39 (holding that

16

despite FTCA provision that an action not filed within the limitations period would be

17

“forever barred”, the FTCA “does not contain such unusually emphatic language that we may

18

infer congressional intent to limit the adjudicatory authority of the federal courts from that

19

language”) (citing Mt. Hood Stages, Inc. v. Greyhound Corp., 616 F.2d 394, 396-407 (9th Cir.

20

1980) (Clayton Act); Partlow v. Jewish Orphans’ Home of Southern Calif., 645 F.2d 757,

21

760-61 (9th Cir. 1981), abrogated on other grounds by Hoffman-La Roche, Inc. v. Sperling,

22

493 U.S. 165, (1989)).

23

Section 983(a)(3)(A) is clear that the government’s failure to file a complaint during

24

the 90-day deadline does not completely bar the government from forfeiture. Instead, the

25

statute requires the government to “return the property pending the filing of a complaint....”

26

18 U.S.C. §983(a)(3)(A). However, if the government does not file a complaint within 90

27

days of the filing of a claim and does not return the property within that time, then the

28

government “shall promptly release the property...and may not take any further action to
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1

effect the civil forfeiture of such property....” 18 U.S.C. §983(a)(3)(B). “While Congress

2

undertook to provide a sanction for the failure to comply with its terms, in doing so, it did

3

not provide or suggest that the court loses subject matter jurisdiction as a result of

4

noncompliance.” Wilson, 699 F.3d at 795. Moreover, §983(a)(3)(A) also permits the

5

government to obtain an extension of the 90-day deadline upon a showing of good cause or

6

with agreement of the parties. 18 U.S.C. §983(a)(3)(A). The Wilson court persuasively

7

found the ability to seek an extension of the deadline “undercut[] any argument that the

8

deadline is jurisdictional. Congress does not typically allow an agreement of the parties to

9

define the scope of the district court's authority to hear a case.” Wilson, 699 F.3d at 795. In

10

sum, nothing about the language in §983(a)(3)(A) expresses “an inflexible rule requiring

11

dismissal whenever its clock has run.” Holland v. Florida, 560 U.S. 631, 634 (2010)

12

(internal quotation marks and citation omitted).

13

Nor does the legislative history suggest that §983(a)(3)(A) is jurisdictional. CAFRA

14

enacted the deadline to address the perception that there was some inequity in imposing

15

deadlines on claimants, while no similar deadlines or sanctions were imposed on the

16

government. However, while CAFRA imposes a deadline and sanction, there is no language

17

suggesting that the deadline is jurisdictional.

18

Further, there is no showing on this record that would support inferring “Congress’

19

intent...from the existence of a ‘long line’ of Supreme Court decisions ‘left undisturbed by

20

Congress’ that ‘treated a similar requirement as ‘jurisdictional.’” Wilson, 699 F.3d at 795-96

21

(quoting Henderson, __ U.S. __, 131 S.Ct. at 1203); compare Bowles, 551 U.S. at 206

22

(provision was jurisdictional where, inter alia, the Court had “long and repeatedly held that

23

the time limits for filing a notice of appeal are jurisdictional in nature.”). Here, there is no

24

line of Supreme Court decisions with regard to §983(a)(3)(A), nor have the parties cited to

25

any Supreme Court decisions addressing a similar statute. See Wilson, 699 F.3d at 796

26

(finding “no similar line of precedents with respect to §983(a)(3).”).

27
28

At bottom, there is no clear language suggesting that §983(a)(3)(A) is jurisdictional.
Nor do contextual considerations support the conclusion that the statute is jurisdictional.
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1

However, determination that §983(a)(3)(A) is nonjurisdictional does not end the

2

analysis as to whether the statute is subject to equitable tolling. Although “a nonjurisdictional

3

federal statute of limitations is normally subject to a ‘rebuttable presumption’ in favor ‘of

4

equitable tolling.’” Holland, 560 U.S. at 645-46 (quoting Irwin v. Department of Veterans

5

Affairs, 498 U.S. 89, 95-96 (1990) and citing Young v. United States, 535 U.S. 43, 49

6

(2002)), the presumption may be rebutted by showing that there is “‘good reason to believe

7

that Congress did not want the equitable tolling doctrine to apply.’” Socop-Gonzalez v.

8

Immigration and Naturalization Service, 272 F.3d 1176, 1188 (9th Cir. 2001) (quoting

9

United States v. Brockamp, 519 U.S. 347, 350 (1997)) (emphasis in original).

10

The Supreme Court has determined equitable tolling is available where the statute at

11

issue does not already afford a generously long limitations period, “does not contain

12

language that is ‘unusually emphatic,’...does [not]...‘re-iterat[e]’ its time limitation[,]...and

13

application of equitable tolling... [would not] affect the ‘substance’ of a petitioner's claim.”

14

Holland, 560 U.S. at 648 (distinguishing cases holding that equitable tolling was not

15

available to various statutes at issue). Prior to CAFRA, there was no deadline for the

16

government to file a complaint for judicial forfeiture. Through enactment of CAFRA,

17

Congress imposed the 90-day filing deadline to address the pre-CAFRA perception that

18

forfeiture proceedings favored the government. See Cassella, at p. 125. Although forfeitures

19

are disfavored, Congress did not expressly state that the 90-day period was not subject to

20

equitable tolling. Instead, the same provision that sets out the 90-day deadline also permits

21

the court to extend that deadline upon a showing of good cause,18 U.S.C. §983(a)(3)(A),

22

which supports the conclusion that the 90-day deadline is subject to some flexibility.

23

“The Supreme Court has only found the Irwin presumption overcome when dealing

24

with statutes containing ‘detail[ed] ... technical language’ and ‘explicit list[s] of exceptions,’

25

Brockamp, 519 U.S. at 352, 117 S.Ct. 849 [(tax code)]; circumstances where equitable tolling

26

‘could create serious administrative problems,’ id.; areas of law where the running of a

27

defined statute of limitations is of “special importance,” [United States] v. Beggerly , 524

28

U.S. [38] at 49, 118 S.Ct. 1862 [(1998) (providing for a 12-year statute of limitations)]; or
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1

statutes the Court previously interpreted as jurisdictional in nature, see John R. Sand &

2

Gravel Co. v. United States, 552 U.S. 130, 128 S.Ct. 750, 755, 169 L.Ed.2d 591 (2008).”

3

Rouse v. United States Dep’t. of State, 567 F.3d 408, 417 (9th Cir. 2009). Section

4

983(a)(3)(A) is not at all similar to the statutes in Brockamp and Beggerly, and permitting

5

equitable tolling would not change the substance of the government’s claim. See e.g.

6

Holland, 560 U.S. at 657 (applying equitable tolling where the statute at issue “differ[ed]

7

significantly from the statutes at issue in...” Brockamp, and Beggerly). Consequently, the

8

doctrine of equitable tolling applies to §983(a)(3)(A).

9

Here, the government bears the burden of showing that equitable tolling should apply.

10

Espinoza–Matthews v. California, 432 F.3d 1021, 1026 (9th Cir.2005). A party is entitled

11

to equitable tolling where “he shows ‘(1) that he has been pursuing his rights diligently, and

12

(2) that some extraordinary circumstance stood in his way’ and prevented the timely filing.”

13

Holland, 560 U.S. at 649 (quoting Pace v. DiGuglielmo, 544 U.S. 408, 418 (2005)).

14

Equitable tolling is not warranted by “a garden variety claim of excusable neglect,”...such

15

as a simple “miscalculation that leads a lawyer to miss a filing deadline.” Id. (internal

16

quotation marks and citation omitted).

17

To support equitable tolling here, the government cites $39,480.00 in U.S. Currency,

18

190 F.Supp.2d at 932-33, where an incorrect date-stamp on the claim resulted in the

19

government filing the complaint one day late. In tolling the 90-day deadline, the court found

20

the government “acted diligently and in good faith in prosecuting the instant case.... If...the

21

date-stamp...had been correct, the Government would have been in full compliance with the

22

ninety-day limitations period. Instead, the Government’s good faith reliance on the

23

[mistaken]...date-stamp caused it to miss the filing by one day.” $39,480.00 in U.S. Currency,

24

190 F.Supp. 2d at 932. Further, the delay did not prejudice the claimant who did not “assert

25

she is under any specific hardship because of the seizure of the money, and an additional day

26

is so inconsequential that it could not significantly exacerbate any difficulty.” Id. at 923-33.

27

Additionally, the claimant did not show the merits of her claim were compromised, and

28

“[s]he will still have her day in court.” Id. at 933.
- 17 -

1

Similarly, when the District Court for the District of Maryland rejected the

2

government’s contention that the 90-day deadline commenced based on the date the claim

3

reached the “appropriate official” instead of the date the claim reached the agency, the court

4

also relied on the factors set out in $39,480.00 in U.S. Currency when ordering further

5

briefing on the issue of equitable tolling: “Equitable tolling here requires the Court to weigh

6

the prejudice caused to [claimants] by tolling the deadline against the prejudice caused to the

7

Government by requiring strict construction of §983.” Beck, 2011 WL 862952 at * 5. The

8

court went on to note that although the claimants may experience significant delay, they

9

“would still [be] afford[ed] the opportunity to dispute merits of the seizure after the

10

Government files its complaint....The Court notes that there is a ‘strong preference for

11

resolving disputes on the merits when possible, instead of determining the outcome solely

12

on technical or procedural grounds.” Id. (citing $39,480.00 in U.S. Currency, 190 F.Supp.2d

13

929, 933 (W.D. Tex. 2002)). “The Court must also consider whether the Government acted

14

in good faith....” Id. Likewise, the District Court for the Southern District of Ohio applied

15

the test set out in $39,480.00 in U.S. Currency to equitably toll the 90-day deadline when the

16

government’s complaint was untimely because the government had mistakenly rejected the

17

claimant’s claim. United States v. Thirty-Four Thousand Nine Hundred Twenty-Nine Dollars

18

and 00/100 Dollars ($34,929.00) in United States Currency, 2010 WL 481250 (S.D. Ohio

19

Feb. 5, 2010) (citing United States v. $114,143.00 in United States Currency, 609 F.Supp.

20

2d 1321 (S.D. Fla. 2009)).

21

The Ninth Circuit has made clear “that the purpose of the equitable tolling doctrine

22

‘is to soften the harsh impact of technical rules which might otherwise prevent a good faith

23

litigant from having a day in court.’ Equitable tolling also serves to ‘prevent the unjust

24

technical forfeiture of causes of action.’” Harris v. Carter, 515 F.3d 1051, 1055 (9th Cir.

25

2008) (quoting Jones v. Blanas, 393 F.3d 918, 928 (9th Cir.2004)). Here, there is a lack of

26

clear, consistent, and binding authority as to when the 90-day period to file a complaint

27

commences. See e.g. Dempsey v. Pacific Bell Co., 789 F.2d 1451, 1453 (9th Cir. 1986)

28

(considering lack of clear precedent as factor in equitable tolling analysis). The government
- 18 -

1

has cited cases supporting the conclusion that the §983(a)(3)(A)’s 90-day period begins when

2

the claim is received by the Forfeiture Paralegal Specialist. (See Response, pp. 2-3 (citing

3

$7,696.00 in U.S. Currency, 2013 WL 1827668 at *4; United States v. Eight Hundred

4

Thousand Twenty-Seven Dollars and Seventy Cents, 2005 WL 6967051 (D.D.C. Mar. 30,

5

2005); United States v. GMC Yukon Denali, CV 03-6890 -JCL (CDC Dec. 4, 2003 Order)).

6

Had this Court adopted the government’s position over the Osbornes’ argument, then the

7

Complaint in this matter would have been timely. In light of the unsettled law on this issue,

8

this case does not involve garden variety neglect or mere negligent miscalculation. Instead,

9

the record supports the conclusion that the government diligently calculated the statutory

10

deadline for filing relying on the date-stamp of July 11, 2013. The government did so based

11

on its interpretation and reliance on the pertinent statutory provisions and regulations.

12

Moreover, case law exists to support the government’s interpretation.

13

government’s diligence and the extraordinary circumstance of the unsettled law on this issue,

14

the Court concludes that the government is entitled to equitable tolling. Nor have the

15

Osbornes shown that the one-day delay is significant or prejudicial. Tolling the deadline still

16

affords Claimants the opportunity to dispute the merits of the seizure. “In contrast to the lack

17

of prejudice to the claimants, dismissal of the Government’s complaint would have a

18

draconian effect on the Government’s case. Granting the Motion to Dismiss would force the

19

Government to release the Respondent Property and bar it from any further action to effect

20

the civil forfeiture of that property.” $39,480.00 in U.S. Currency, 190 F.Supp. 2d at 932

21

(citing 18 U.S.C. §983(a)(3)(B)). Such a result is especially harsh in light of the minimal

22

delay and the government’s diligent attempt to file the complaint within what it deemed to

23

be the statutory period. Concluding otherwise overlooks the “strong preference for resolving

24

disputes on the merits when possible, instead of determining the outcome solely on technical

25

or procedural grounds.” Id.; cf. Harris, 515 F.3d at 1055.

Given the

26

The Osbornes point out that the government did not have to wait to file the Complaint

27

until what it thought was the last day. (Reply, p.7). Regardless, had the this Court adopted

28

the government’s position, the Complaint would have been timely. In a further attempt to
- 19 -

1

show the government did not act in good faith, the Osbornes point out that although the

2

Complaint was filed with the Court on October 9, 2013, it was not served until January 13,

3

2014. (Motion, p.5). The Osbornes also assert that the government did not serve them with

4

magistrate judge election form in a timely manner. The government correctly points out that

5

service was timely made within the 120 days allowed under Rule 4 of the Federal Rules of

6

Civil Procedure. The government further states that the magistrate judge election form is not

7

due until 14 days after entry of counsel’s appearance, and the government served the form

8

at the time it served the Complaint. The Osbornes have not argued that the Complaint was

9

untimely served under the Rules. Moreover, the issue of service of the election forms is a

10

collateral matter that has no bearing on the instant analysis.

11

CONCLUSION

12

For the foregoing reasons, the Complaint in this matter is untimely filed by one day.

13

However, the doctrine of equitable tolling properly applies to excuse the late filing.

14

Accordingly,

15
16

IT IS ORDERED that Claimants’ Motion to Dismiss (Doc. 9), converted to a Motion
for Summary Judgment, is DENIED.

17

IT IS FURTHER ORDERED that this matter is SET for a status conference on

18

WEDNESDAY, OCTOBER 22, 2014 AT 9:45 A.M. If counsel wish to appear telephonically,

19

counsel should contact the undersigned’s law clerk no later than 4:00 p.m. on October 21,

20

2014, with the number where counsel may be reached.

21

DATED this 25th day of September, 2014.

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