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)

Download PDF
1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 DISTRICT OF NEVADA 10 11 UNITED STATES OF AMERICA, 12 Plaintiff, 13 vs. 14 $102,283.44 IN UNITED STATES CURRENCY SEIZED FROM BANK OF AMERICA ACCOUNT, 15 16 ) ) ) ) ) ) ) ) ) ) 3:14-cv-00506-HDM-VPC ORDER Defendant. _________________________________ 17 Before the court is plaintiff United States of America’s (the 18 “government”) motion to strike answer to complaint in forfeiture 19 (#13) and motion to strike notice of claim (#20). Claimant Rafael 20 Jimenez-Alvarez (Alvarez) filed responses to each motion (## 17 and 21 22) and plaintiff replied (## 19 and 23). 22 Procedural History 23 This case is a civil forfeiture action brought by the 24 government against a sum of money based on allegations that the 25 funds represent the proceeds of illicit sales of controlled 26 substances or listed chemicals. The government filed its complaint 27 for forfeiture in rem (#1) on October 1, 2014. The court thereafter 28 1 1 entered its order for summons and warrant of arrest in rem for 2 property and notice (#3), and the clerk of the court issued a 3 summons and warrant of arrest in rem for property (#4) on October 4 15, 2014. The complaint, order, summons, and notice were served on 5 Alvarez, who filed an answer on November 14, 2014 (#8). On November 6 28, 2014, the government filed its motion to strike claimant’s 7 answer (#13) on the basis that Alvarez had failed to timely file a 8 verified claim of interest. Alvarez subsequently filed his claim on 9 December 15, 2015 (#15), which led the government to file a second 10 11 motion to strike (#20).1 The court held a hearing on the motions on March 26, 2015. The 12 court took the motions under advisement and allowed the parties 13 time to attempt to resolve the case. By subsequent orders (## 30, 14 32), the court approved the parties’ stipulations for additional 15 time to discuss a possible resolution. 16 On June 12, 2015, the parties advised the court they were 17 unable to resolve the case. 18 The Motions 19 The government seeks to strike the answer filed by Alvarez on 20 the ground that he failed to file a verified claim to the subject 21 property. 22 jurisdictional prerequisite to participation in the instant 23 forfeiture proceedings. Alvarez responded by filing a verified 24 claim (#15). 25 the verified claim on the basis that Alvarez “failed to file a 26 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 27 28 1 This time on Alvarez’s verified claim. 2 1 expired and then only did so after the delinquency was brought to 2 [his] attention through the filing of the [government’s] pending 3 motion to strike the answer.” #20 Mot. at 1:22-2:1. 4 In Alvarez’s opposition to the motion to strike the answer, 5 his counsel contends he submitted a claim opposing forfeiture to 6 the DEA, Asset Forfeiture Section, on May 28, 2014. Additionally, 7 Alvarez filed a petition for remission or mitigation of a criminal 8 or civil forfeiture action by the United States Department of 9 Justice on July 16, 2014. Nevertheless, Alvarez concedes that after 10 the filing of the complaint for forfeiture in rem by the 11 government, he failed to file a verified claim along with his 12 answer. 13 Alvarez’s counsel asserts he believes he sent the verified 14 claim to Alvarez for his signature, but is unsure whether it was 15 lost by the department of corrections or if his counsel’s office 16 “failed to actually include it along with the answer” in its 17 mailing to Alvarez. Response (#17) at 4:8-11. Counsel claims he has 18 had a difficult time corresponding with Alvarez in part due to the 19 language barrier and in part due to Alvarez’s relocation to 20 different prisons. Id. at 4:15-19. Alvarez’s counsel avers, 21 however, that the government was put on notice of Alvarez’s claim 22 by the original filings with the DEA and that it is not unduly 23 prejudiced by the late filing of the verified claim. Id. at 5:1-5. 24 Legal Standard 25 The parties agree that the Supplemental Rules for Certain 26 Admiralty and Maritime Claims govern the issue of judicial 27 forfeitures of property in this case. United States v. 5145 N. 28 Golden State Blvd., 135 F.3d 1312, 1315 (9th Cir. 1998). 3 1 2 3 4 5 6 7 8 9 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) . . . . 10 Supp. R. G(5). 11 The notice must state a deadline for filing a claim, at least 12 13 35 days after the notice is sent. Supp. R. G(4)(b)(ii)(B). Relatedly, “at any time before trial, the government may move 14 to strike a claim or answer: (A) for failing to comply with Rule 15 G(5) or (6) . . . .” Rule G(8)(c)(i). 16 Analysis 17 There is no dispute the claim was filed outside the time 18 allotted by statute: the claim was filed on December 15, 2014. The 19 notice granted 35 days for filing the claim. That time expired on 20 November 25, 2014.2 Alvarez urges the court to allow the answer and 21 untimely filed verified notice of claim because the government has 22 not been prejudiced. The parties agree the court may, for good 23 cause, set a different time, pursuant to Rule G(5)(a)(ii). The 24 parties disagree on whether the court should exercise such 25 26 27 28 2 The notice to claimant listed November 25, 2014, as the last possible date to file a verified claim. The government has referenced November 24, 2014, in its motions. As the parties other assertions and the 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. 4 1 2 discretion in this case. The Ninth Circuit has held a district court “should only 3 exercise its discretion to grant additional time where the goals 4 underlying the time restriction and the verification requirement 5 are not thwarted.” United States v. 1982 Yukon Delta Houseboat, 774 6 F.2d 1432, 1435-36 (9th Cir. 1985). 7 Several factors have been identified for district courts to 8 consider when determining whether to grant additional time. These 9 include: when the claimant became aware of the currency’s seizure, 10 whether the United States Attorney may have encouraged the delay, 11 whether the claimant has suffered injury or illness that may have 12 caused a delay in filing, whether the government would be 13 prejudiced by allowing the late filing, whether the claimant 14 informed the government and the court of his interest before the 15 deadline, and whether the claimant timely petitioned for an 16 enlargement of time. See United States v. $100,348.00 in U.S. 17 Currency, 354 F.3d 1110, 1117-19 (9th Cir. 2004). 18 These factors provide some context for the court’s 19 consideration. Alvarez became officially aware of the seizure 20 through direct notification by the government (#5); however, it is 21 clear Alvarez anticipated forfeiture proceedings even before the 22 direct notification, given his counsel’s administrative filings 23 with the DEA. Response (#17) at 5:1-5. The delay is not excused 24 through injury or illness, as there is no representation indicating 25 Alvarez has suffered injury or illness. However, there is some 26 indication that Alvarez’s counsel had difficulty communicating with 27 Alvarez because he was relocated to a different prison. Response 28 (#17) at 4:15-19. 5 1 Alvarez’s argument principally rests on the degree of notice 2 and prejudice present in this case. There is no contention or 3 evidence suggesting the United States Attorney may have encouraged 4 the delay. Nonetheless, the government was aware of Alvarez’s 5 intention to contest the forfeiture: Alvarez sent the government’s 6 attorney, who filed the pending motions to strike, two hundred 7 twenty two pages of discovery related to his ownership of the 8 assets and his claim on October 30, 2014. Response to Gov’t’s 9 Notice (#35) at 3:13-16. Alvarez’s actions reflect a clear desire 10 to contest the forfeiture and were directed to the government 11 attorney who is handling the forfeiture. Moreover, the answer to 12 the government’s complaint in forfeiture (#8) requests return of 13 the property within its prayer for relief. The answer was filed 14 timely, but did not include the verified claim. 15 Court and statutory rules and deadlines are not to be lightly 16 cast aside. Parties have an interest in predictable and efficient 17 outcomes. As the parties acknowledge, the court may, however, in 18 limited circumstances, permit a late filing of the verified claim. 19 Supp. R. G(5)(ii).3 20 In this case, the government makes no claim of prejudice, but 21 relies solely on the failure of Alvarez to timely file his verified 22 claim. The apparent lack of prejudice and the evident attempts by 23 24 25 26 27 28 3 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. 6 1 Alvarez to comply with the rules and pursue his claim militate in 2 favor of permitting the late filing. Courts have found where a 3 claimant has made a good-faith effort to file a claim and where the 4 government can show no prejudice by the granting of an extension of 5 time, it is proper to allow such an extension. See U.S. v. 6 Currency, in the Amount of $103,387.27, 863 F.2d 555 (1988). “This 7 is especially true in a case where the defect is technical, where 8 it was made by the attorney and not the claimants, and where the 9 amount of currency is so large.” Id. Alvarez’s counsel admits the 10 technical defect and acknowledges he was in error for not 11 requesting an enlargement of time to file the claim; additionally, 12 the amount of currency at issue is substantial. 13 Alvarez’s counsel asserts he made no request for enlargement 14 of time because 1) he did not expect the delays caused by his 15 difficulty locating and communicating with his client (Response 16 (#17) at 4:15-19) and he inaccurately believed the government had 17 acceded to an extension, as reflected in his filing of discovery 18 and communications with government counsel. Id. at 3:21-24; see 19 also #35 at 3:13-16. These explanations demonstrate Alvarez has 20 continuously pursued a claim to the property.4 21 Under the exceptional circumstances of this case, the court 22 concludes there is good cause to permit the untimely verified 23 claim. The government has cited no prejudice, and Alvarez filed his 24 verified claim approximately two weeks after the government moved 25 to strike the answer based on the lack of a verified claim. The 26 government was aware Alvarez was pursuing the property, that he was 27 28 4 Additionally, Alvarez filed his answer (#8) and his jury demand (#11) shortly after receiving the government’s notice (#7). 7 1 represented, and that his counsel was compiling discovery. Since 2 the filing of the answer, verified claim, and the government’s 3 motions to strike, discovery has proceeded and Alvarez has 4 responded to the governments interrogatories and requests for 5 production of documents. #34 at 3:17-19. In totality, the facts 6 demonstrate Alvarez made a good-faith effort to file a claim. As 7 the government has shown no prejudice, the court finds good cause 8 to permit Alvarez to file his verified claim (#15) and append it to 9 the answer he filed timely on November 14, 2014 (#8). 10 11 Conclusion Accordingly, and based on the foregoing, it is hereby ORDERED 12 that plaintiff United States of America’s motion to strike the 13 answer to complaint in forfeiture (#13) is DENIED. 14 15 IT IS FURTHER ORDERED plaintiff United States of America’s motion to strike the notice of claim (#20) is DENIED. 16 IT IS SO ORDERED. 17 DATED: This 10th day of July, 2015. 18 19 ____________________________ UNITED STATES DISTRICT JUDGE 20 21 22 23 24 25 26 27 28 8

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?