United States of America v. $102,283.44 in United States Currency Seized From Bank of America Account

Filing 36

ORDER denying 13 motion to strike answer and denying 20 motion to strike notice of claim. Signed by Judge Howard D. McKibben on 7/10/15. (Copies have been distributed pursuant to the NEF - JC)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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UNITED STATES OF AMERICA,

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Plaintiff,

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vs.

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$102,283.44 IN UNITED STATES
CURRENCY SEIZED FROM BANK OF
AMERICA ACCOUNT,

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3:14-cv-00506-HDM-VPC
ORDER

Defendant.
_________________________________

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Before the court is plaintiff United States of America’s (the
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“government”) motion to strike answer to complaint in forfeiture
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(#13) and motion to strike notice of claim (#20). Claimant Rafael
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Jimenez-Alvarez (Alvarez) filed responses to each motion (## 17 and
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Procedural History
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This case is a civil forfeiture action brought by the
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government against a sum of money based on allegations that the
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funds represent the proceeds of illicit sales of controlled
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substances or listed chemicals. The government filed its complaint
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for forfeiture in rem (#1) on October 1, 2014. The court thereafter
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entered its order for summons and warrant of arrest in rem for

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property and notice (#3), and the clerk of the court issued a

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summons and warrant of arrest in rem for property (#4) on October

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15, 2014. The complaint, order, summons, and notice were served on

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Alvarez, who filed an answer on November 14, 2014 (#8). On November

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28, 2014, the government filed its motion to strike claimant’s

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answer (#13) on the basis that Alvarez had failed to timely file a

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verified claim of interest. Alvarez subsequently filed his claim on

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December 15, 2015 (#15), which led the government to file a second

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motion to strike (#20).1
The court held a hearing on the motions on March 26, 2015. The

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court took the motions under advisement and allowed the parties

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time to attempt to resolve the case. By subsequent orders (## 30,

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time to discuss a possible resolution.

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On June 12, 2015, the parties advised the court they were

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unable to resolve the case.

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The Motions

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The government seeks to strike the answer filed by Alvarez on

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the ground that he failed to file a verified claim to the subject

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property.

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jurisdictional prerequisite to participation in the instant

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forfeiture proceedings. Alvarez responded by filing a verified

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claim (#15).

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the verified claim on the basis that Alvarez “failed to file a

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verified claim until long after the deadline for such a filing had

The government asserts the filing of such a claim is a

The government thereafter filed a motion to strike

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This time on Alvarez’s verified claim.

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expired and then only did so after the delinquency was brought to

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[his] attention through the filing of the [government’s] pending

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motion to strike the answer.” #20 Mot. at 1:22-2:1.

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In Alvarez’s opposition to the motion to strike the answer,

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his counsel contends he submitted a claim opposing forfeiture to

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the DEA, Asset Forfeiture Section, on May 28, 2014. Additionally,

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Alvarez filed a petition for remission or mitigation of a criminal

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or civil forfeiture action by the United States Department of

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Justice on July 16, 2014. Nevertheless, Alvarez concedes that after

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the filing of the complaint for forfeiture in rem by the

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government, he failed to file a verified claim along with his

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answer.

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Alvarez’s counsel asserts he believes he sent the verified

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claim to Alvarez for his signature, but is unsure whether it was

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lost by the department of corrections or if his counsel’s office

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“failed to actually include it along with the answer” in its

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mailing to Alvarez. Response (#17) at 4:8-11. Counsel claims he has

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had a difficult time corresponding with Alvarez in part due to the

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language barrier and in part due to Alvarez’s relocation to

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different prisons. Id. at 4:15-19. Alvarez’s counsel avers,

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however, that the government was put on notice of Alvarez’s claim

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by the original filings with the DEA and that it is not unduly

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prejudiced by the late filing of the verified claim. Id. at 5:1-5.

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Legal Standard

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The parties agree that the Supplemental Rules for Certain

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Admiralty and Maritime Claims govern the issue of judicial

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forfeitures of property in this case. United States v. 5145 N.

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Golden State Blvd., 135 F.3d 1312, 1315 (9th Cir. 1998).
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Pursuant to those rules,
(i) A person who asserts an interest in the defendant
property may contest the forfeiture by filing a claim in
the court where the action is pending. The claim must:
(A) identify the specific property claimed;
(B) identify the claimant and state the claimant’s
interest in the property;
(C) be signed by the claimant under penalty of
perjury; and
(D) be served on the government attorney designated
under Rule G(4)(a)(ii)(C) or (b)(ii)(D).
(ii) Unless the court for good cause sets a different
time, the claim must be filed:
(A) by the time stated in a direct notice sent under
Rule G(4)(b)
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Supp. R. G(5).

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The notice must state a deadline for filing a claim, at least

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35 days after the notice is sent. Supp. R. G(4)(b)(ii)(B).
Relatedly, “at any time before trial, the government may move

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to strike a claim or answer: (A) for failing to comply with Rule

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G(5) or (6) . . . .” Rule G(8)(c)(i).

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Analysis

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There is no dispute the claim was filed outside the time

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allotted by statute: the claim was filed on December 15, 2014. The

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notice granted 35 days for filing the claim. That time expired on

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November 25, 2014.2 Alvarez urges the court to allow the answer and

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untimely filed verified notice of claim because the government has

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not been prejudiced. The parties agree the court may, for good

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cause, set a different time, pursuant to Rule G(5)(a)(ii). The

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parties disagree on whether the court should exercise such

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The notice to claimant listed November 25, 2014, as the last possible
date to file a verified claim. The government has referenced November
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court’s conclusions remain the same whether November 24 or 25 is used,
the court here uses the date referenced by the government in its notice
to Alvarez.

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discretion in this case.
The Ninth Circuit has held a district court “should only

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exercise its discretion to grant additional time where the goals

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underlying the time restriction and the verification requirement

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are not thwarted.” United States v. 1982 Yukon Delta Houseboat, 774

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F.2d 1432, 1435-36 (9th Cir. 1985).

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Several factors have been identified for district courts to

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consider when determining whether to grant additional time. These

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include: when the claimant became aware of the currency’s seizure,

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whether the United States Attorney may have encouraged the delay,

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whether the claimant has suffered injury or illness that may have

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caused a delay in filing, whether the government would be

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prejudiced by allowing the late filing, whether the claimant

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informed the government and the court of his interest before the

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deadline, and whether the claimant timely petitioned for an

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enlargement of time. See United States v. $100,348.00 in U.S.

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Currency, 354 F.3d 1110, 1117-19 (9th Cir. 2004).

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These factors provide some context for the court’s

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consideration. Alvarez became officially aware of the seizure

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through direct notification by the government (#5); however, it is

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clear Alvarez anticipated forfeiture proceedings even before the

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direct notification, given his counsel’s administrative filings

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with the DEA. Response (#17) at 5:1-5. The delay is not excused

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through injury or illness, as there is no representation indicating

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Alvarez has suffered injury or illness. However, there is some

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indication that Alvarez’s counsel had difficulty communicating with

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Alvarez because he was relocated to a different prison. Response

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(#17) at 4:15-19.
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Alvarez’s argument principally rests on the degree of notice

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and prejudice present in this case. There is no contention or

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evidence suggesting the United States Attorney may have encouraged

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the delay. Nonetheless, the government was aware of Alvarez’s

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intention to contest the forfeiture: Alvarez sent the government’s

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attorney, who filed the pending motions to strike, two hundred

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twenty two pages of discovery related to his ownership of the

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assets and his claim on October 30, 2014. Response to Gov’t’s

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Notice (#35) at 3:13-16. Alvarez’s actions reflect a clear desire

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to contest the forfeiture and were directed to the government

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attorney who is handling the forfeiture. Moreover, the answer to

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the government’s complaint in forfeiture (#8) requests return of

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the property within its prayer for relief. The answer was filed

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timely, but did not include the verified claim.

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Court and statutory rules and deadlines are not to be lightly

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cast aside. Parties have an interest in predictable and efficient

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outcomes. As the parties acknowledge, the court may, however, in

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limited circumstances, permit a late filing of the verified claim.

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Supp. R. G(5)(ii).3

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In this case, the government makes no claim of prejudice, but

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relies solely on the failure of Alvarez to timely file his verified

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claim. The apparent lack of prejudice and the evident attempts by

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18 U.S.C.A. § 983(4)(A) states a verified claim may be filed not later
than 30 days after the date of service of the Government’s complaint
or, as applicable, not later than 30 days after the date of final
publication of notice of the filing of the complaint. Here, the
government has proceeded under the presumption the court has the
authority to grant an extension pursuant to the standard enumerated in
the Supplemental Rules. Moreover, Alvarez’s claim was filed within 30
days of the final publication of the notice. Accordingly, the court
concludes it has the authority to permit Alvarez’s verified claim and
answer.

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Alvarez to comply with the rules and pursue his claim militate in

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favor of permitting the late filing. Courts have found where a

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claimant has made a good-faith effort to file a claim and where the

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government can show no prejudice by the granting of an extension of

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time, it is proper to allow such an extension. See U.S. v.

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Currency, in the Amount of $103,387.27, 863 F.2d 555 (1988). “This

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is especially true in a case where the defect is technical, where

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it was made by the attorney and not the claimants, and where the

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amount of currency is so large.” Id. Alvarez’s counsel admits the

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technical defect and acknowledges he was in error for not

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requesting an enlargement of time to file the claim; additionally,

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the amount of currency at issue is substantial.

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Alvarez’s counsel asserts he made no request for enlargement

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of time because 1) he did not expect the delays caused by his

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difficulty locating and communicating with his client (Response

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(#17) at 4:15-19) and he inaccurately believed the government had

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acceded to an extension, as reflected in his filing of discovery

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and communications with government counsel. Id. at 3:21-24; see

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also #35 at 3:13-16. These explanations demonstrate Alvarez has

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continuously pursued a claim to the property.4

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Under the exceptional circumstances of this case, the court

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concludes there is good cause to permit the untimely verified

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claim. The government has cited no prejudice, and Alvarez filed his

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verified claim approximately two weeks after the government moved

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to strike the answer based on the lack of a verified claim. The

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government was aware Alvarez was pursuing the property, that he was

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Additionally, Alvarez filed his answer (#8) and his jury demand (#11)
shortly after receiving the government’s notice (#7).

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represented, and that his counsel was compiling discovery. Since

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the filing of the answer, verified claim, and the government’s

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motions to strike, discovery has proceeded and Alvarez has

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responded to the governments interrogatories and requests for

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production of documents. #34 at 3:17-19. In totality, the facts

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demonstrate Alvarez made a good-faith effort to file a claim. As

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the government has shown no prejudice, the court finds good cause

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to permit Alvarez to file his verified claim (#15) and append it to

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the answer he filed timely on November 14, 2014 (#8).

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Conclusion
Accordingly, and based on the foregoing, it is hereby ORDERED

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that plaintiff United States of America’s motion to strike the

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answer to complaint in forfeiture (#13) is DENIED.

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IT IS FURTHER ORDERED plaintiff United States of America’s
motion to strike the notice of claim (#20) is DENIED.

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IT IS SO ORDERED.

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DATED: This 10th day of July, 2015.

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____________________________
UNITED STATES DISTRICT JUDGE

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