United States of America v. $54,052.10 in U.S. Currency

Filing 12

MEMORANDUM ORDER DENYING 8 Claimants' Motion for Summary Judgment. Signed by Judge Theodore D. Chuang on 6/15/2015. (kns, Deputy Clerk)

Ul"ITED STA n:s DISTRICT COURT
DISTRICT OF MARYLAl"D

UNITED STATES OF AMERICA,

Plaintiff,
v.

Civil Action No. TDC-14-3774

$54,052.10 in U.S. CURRENCY,
Defendant.

~IE~IORAl"IJUM

ORIJER

This civil forfeiture case is before the Coun on Claimants'
Judgment.

ECF NO.8.

necessary.

See Local Rule 105.6 (D. Md. 2014).

Motion for Summary

Having reviewed the parties' submissions, the Court finds no hearing
For the follo\ving reasons, the Motion for

Summary Judgment is DENIED.
IIACKGROUl"1J
On May 29, 2014, the Baltimore City Police Department seized $21,087.00 from the
residence of Omar Kinnard Harmon ("Harmon"), and on May 30, 2014, it seized $32,965.10
from Harmon's bank accounts. All funds were seized pursuant to search warrants and as the
alleged proceeds of unlawful drug trafficking.

At some point before December 3, 2014, the

seized currency was turned over to the United States Drug Enforcement Administration ("DEA")
in Maryland.
On December 3, 2014, the United States tiled a Complaint for Forfeiture asserting that
the funds were the proceeds of unlav•.ul drug trafficking,
f

in violation of the Controlled

Substances Act, 28 U.S.c. ~ 801 et seq., and are therefore subject to forfeiture under 21 U.S.c.
881(a)(6).

*

On December 4, 2014, this Court issued an arrest warrant in rem for the currency,

\\'hich was executed on December 10, 2014. On January 2, 20 IS, Flannon tiled a claim for all of
the seized currency, and his mother, Denise Lorraine Smith ("Smith"), filed a claim for the
532,965.10 seized from the bank accounts.
Answer to the Complaint.

On January 23, 2015, Harmon and Smith filed an

On February 6, 2015, they filed a Motion for Summary Judgment,

which the United States opposed on February 23, 2015.

Hannon and Smith filed their Reply

Memorandum on March 12,2015.
lllSCUSSIO:-':
Pursuant to Federal Rule of Civil Procedure 56(a), the Court "shall grant summary
judgment if the movant shows that there is no genuine dispute as to any material fact and the
movant is entitled tu judgment as a matter of law." Fed. R. Civ. P. 56(a). Here.

Harmon

Smith assert that the United States lacks the capacity to sue and the authority to sue

and
III

a

representative capacity, in contravention of Federal Rule of Civil Procedure 9(a), and that they
are therefore entitled to judgment as a matter of law, Hannon and Smith base this contention on
a January 16, 2015 Order issued by Attorney General Eric H. Holder, Jr., which directed "all
Department of Justice attorneys and components" to follow a new policy prohibiting "Federal
adoption of pwperty seized by state or 10calla\\I enfurcement under state la\\'," except in certain
circumstances not present here. The Order expressly states that the pulicy "applies prospectively
to all federal adoptions."

Mot. Sum. 1., Ex. A.

Because the Order states that it applies only prospectively, the United States argues that
either it "applies only t<Jseizures that occur after January 16,2015,"

or it "does not apply to

federally adopted forfeiture cases that "vere filed in court befure the effective date of the Order."
Response ~ 6. Here, the currency was seized on I\lay 29, 2014 and May 30, 2014, and this action
was commenced on December 3,2014,

The Government thus argues that, under either standard,

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this action falls outside the Order's ambit. Harmon and Smith reply that, because this action is
"now being litigated in federal court," the federal government has not yet "adopted" the property
seized by the statc, so the Order applics to this action. Reply ~ 2.
Whether the Ordcr applies to the instant forfeiture action depends on when the federal
government can be said to have adopted the state-seized property. The relevant statutes do not
delineate when adoption is complete.

See 18 U,S.C.

S

981 et seq.

In discussing the federal

adoption of state-seized property, however, the United States Court of Appeals for the Fourth
Circuit has stated that a federal agency "adopts seizures by state or local law enforcement
oflicials when it takes custody of seized property and treats the property as if [it] had made the
initial seizure, [The federal agency] may then institute forfeiture proceedings in accordance with
federallav.' ... Uniled States v. Winston-Salem/Forsyth

County Board of Education, 902 F.2d 267,

269 n.1 (4th Cir. 1990). Although the Fourth Circuit was not presented in Winston-Salem with
the question at issue here, its overviev./ of the adoption process is instructive.
Circuit's

rule, that the federal adoption of state-seized

The Fourth

property occurs when the federal

government gains physical and decisional control over the property, is a logically sound one, tied
to the heart of the adoption process: transfer of control from state to federal officials.
and Smith's

contrary proposal-that

proceedings remain contested-would
federal government,

adoption is not complete

Ilarmon

as long as the forfeiture

key adoption not to any transfer in control from state to

but to the resolution of the dispute between the government

claimants. Such an approach would be untenable because it would allo\\'

a

federal

and the
forfeiture

action to unfold without the federal government ever having officially gained control over the
property at issue.

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Under the Fourth Circuit's approach, the federal government adopted the state-seized
currency no later than December 3, 2014, the date that the United States tiled its Complaint for
Forfeiture and statcd that the seized currency was in DEA custody.

Because the federal

govcrnment's adoption of the state-seized property at issue in this case was complete more than a
month before the Attorney General issued the Order on January 16, 2015, the Order's prohibition
on federal adoptions does not apply to this action. Nevertheless, the Court trusts that the United
States Attorney tor the District of Maryland has consulted with the Department of Justice on
whether to continue with this forfeiture action in light of the Attorney General's Order.
Because the Court concludes that the Order docs not apply to this forfeiture action, it
need not, and so does not, resolve the Government's additional contention that claimants have no
enforceable rights based on the January 16, 2015 Order.
CO:'iCLUSIO:'i
For the foregoing reasons, it is hereby ORDERED that Claimants' Motion for Summary
Judgment is DENIED.

Date: June 15,2015

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