UNITED STATES OF AMERICA v. 6407 MONNETT ROAD, CLIMAX, GUILFORD COUNTY, NORTH CAROLINA, WITH ALL APPURTENANCES AND IMPROVEMENTS THEREON et al

Filing 52

ORDER signed by CHIEF JUDGE WILLIAM L. OSTEEN, JR on 03/31/2017, that the Magistrate Judge's Recommendation (Doc. 76 ) is ADOPTED except as modified herein. FURTHER ORDERED that Claimants' Motions and Supplemental Motions for the Return of Seized Property in 1:15MJ32 to 1:15MJ38, 1:15MJ40 to 1:15MJ45, and 1:15MJ49 through 1:15MJ85 are DENIED and that Claimants' Motions to Dismiss in 1:15CV152 (Doc. 10 ) and 1:15CV506 (Doc. 9 ) are DENIED. FURTHER ORDERED that the Magistrat e Judge's order granting the stay is AFFIRMED AS MODIFIED HEREIN. FURTHER ORDERED that Claimants' Motions to Supplement their Objections to the Order and Recommendation are GRANTED to the extent that the additional objections have been considered. Associated Cases: 1:15-cv-00506-WO-JEP, 1:15-cv-00152-WO-JEP (Garland, Leah)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
UNITED STATES OF AMERICA,

)
)
Plaintiff,
)
)
v.
)
1:15CV506
)
$39,956.45 IN U.S. CURRENCY
)
SEIZED FROM BANK OF NORTH
)
CAROLINA ACCOUNT ENDING IN
)
3974, IN THE NAME OF RD
)
JESSUP PROPERTIES, LLC, et al., )
)
Defendants.
)
________________________________________________________________
UNITED STATES OF AMERICA,

)
)
Plaintiff,
)
)
v.
)
1:15CV152
)
6407 MONNETT ROAD, CLIMAX,
)
GUILFORD COUNTY, NORTH
)
CAROLINA, WITH ALL
)
APPURTENANCES AND
)
IMPROVEMENTS THEREON, et al.,
)
)
Defendants.
)
_______________________________________________________________
In the Matter of the Seizure of )
All funds on deposit at Bank
)
of North Carolina in the
)
account ending in number
)
xx3974, in the name of RD
)
Jessup Properties, LLC
)
In the Matter of the Seizure of )
L4600 Kubota DT 4x4 Tractor
)

1:15MJ32

1:15MJ33

In the Matter of the Seizure of )
All funds on deposit at Bank
)
of North Carolina in the
)
account ending in number
)
xx3044, in the name of Gate
)
City Transportation
)
In the Matter of the Seizure of
All funds on deposit at First
Citizens Bank in the account
ending in number xx8448, in
the name of Gate City
Transportation

)
)
)
)
)
)

In the Matter of the Seizure of )
All funds on deposit at Bank
)
of North Carolina in the
)
account ending in number
)
xx9565, in the name of C.D.
)
and Roderick D. Jessup
)
In the Matter of the Seizure of
All funds on deposit at First
Citizens Bank in the account
ending in number xx7104, in
the name of Gate City
Transportation

)
)
)
)
)
)

In the Matter of the Seizure of )
2012 Ford F-250,
)
VIN 1FT7W2BT0CEC48613
)
In the Matter of the Seizure of )
All funds on deposit at Bank
)
of North Carolina in the
)
account ending in number
)
xx4148, in the name of
)
Roderick D. Jessup
)
In the Matter of the Seizure of
All funds on deposit at First
Citizens Bank in the account
ending in number xx0396, in
the name of Roderick Jessup

)
)
)
)
)

- 2 -

1:15MJ34

1:15MJ35

1:15MJ36

1:15MJ37

1:15MJ38

1:15MJ40

1:15MJ41

In the Matter of the Seizure of )
All funds on deposit at Bank
)
of North Carolina in the
)
account ending in number
)
xx8627, in the name of
)
Roderick D. Jessup
)
In the Matter of the Seizure of
Funds up to $11,200.00 on
deposit at Bank of North
North Carolina in the account
ending in xx5185, in the name
of Gate City Transp.,
Sickle Cell Gala account

)
)
)
)
)
)
)

In the Matter of the Seizure of )
2014 BMW X5,
)
VIN 5UXKR6C51E0J73461
)
In the Matter of the Seizure of )
All funds on deposit at Bank
)
of North Carolina in the
)
account ending in number
)
xx2413, in the name of Gate
)
City Transportation
)

1:15MJ42

1:15MJ43

1:15MJ44

1:15MJ45

In the Matter of the Seizure of )
2014 Ford Econoline,
)
VIN 1FTNS2EW9EDA12267
)

1:15MJ49

In the Matter of the Seizure of )
2013 Ford E350 Econoline,
)
VIN 1FBSS3BL3DDA64659
)

1:15MJ50

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL1CDA76632
)

1:15MJ51

In the Matter of the Seizure of )
2012 Ford E250 Econoline,
)
VIN 1FTNS2EW9CDA21161
)

1:15MJ52

In the Matter of the Seizure of )
2012 Ford E250 Cargo Van,
)
VIN 1FTNS2EW0CDB20984
)

1:15MJ53

- 3 -

In the Matter of the Seizure of )
2011 Ford E350 XLT –
)
15 passenger,
)
VIN 1FBSS3BL8BDA98092
)

1:15MJ54

In the Matter of the Seizure of )
2012 Ford E250 Econoline,
)
VIN 1FTNS2EW4DDA39018
)

1:15MJ55

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL7CDA76599
)

1:15MJ56

In the Matter of the Seizure of )
2012 Ford E250 Econoline,
)
VIN 1FTNS2EW5CDB14646
)

1:15MJ57

In the Matter of the Seizure of )
2012 Ford E250 Econoline,
)
VIN 1FTNS2EWXCDB18059
)

1:15MJ58

In the Matter of the Seizure of )
2013 Bus, VIN 1FDEE3FS8DDB04800 )

1:15MJ59

In the Matter of the Seizure of )
2001 Chance 22 Seat Trolley,
)
VIN 1C9S2HFS51W535229
)

1:15MJ60

In the Matter of the Seizure of )
2001 Chance 22 Seat Trolley,
)
VIN 1C9S2HFS31W535228
)

1:15MJ61

In the Matter of the Seizure of )
2011 Ford Crown Victoria,
)
VIN 2FABP7EV6BX128657
)

1:15MJ62

In the Matter of the Seizure of )
2011 Ford E350 Econoline,
)
VIN 1FBSS3BL3BDB37395
)

1:15MJ63

In the Matter of the Seizure of )
2013 Ford E250 Econoline,
)
VIN 1FTNS2EW0DDA08297
)

1:15MJ64

- 4 -

In the Matter of the Seizure of )
2013 Bus, VIN 1FDEE3FS3DDB37400 )

1:15MJ65

In the Matter of the Seizure of )
2011 Ford E250 Econoline,
)
VIN 1FTNS2EW3BDB23859
)

1:15MJ66

In the Matter of the Seizure of )
2013 Ford E250 Econoline,
)
VIN 1FTNS2EW2DDA08298
)

1:15MJ67

In the Matter of the Seizure of:)
2013 Ford E350 Econoline,
)
VIN 1FBSS3BL9DDA61510
)

1:15MJ68

In the Matter of the Seizure of )
2013 Ford E350 Econoline,
)
VIN 1FBSS3BL4DDA61379
)

1:15MJ69

In the Matter of the Seizure of )
2013 Ford E350 Econoline,
)
VIN 1FBSS3BL9DDA71342
)

1:15MJ70

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL8CDA98935
)

1:15MJ71

In the Matter of the Seizure of )
2013 Ford E250 Cargo Van,
)
VIN 1FTNS2EW0DDA30199
)

1:15MJ72

In the Matter of the Seizure of )
2011 Ford E350 XLT –
)
15 passenger,
)
VIN 1FBSS3BL8BDB10418
)

1:15MJ73

In the Matter of the Seizure of )
2011 Ford E250 Econoline,
)
VIN 1FTNS2EW0BDB29571
)

1:15MJ74

In the Matter of the Seizure of )
2011 Ford Crown Victoria,
)
VIN 2FABP7EV5BX149676
)

1:15MJ75

- 5 -

In the Matter of the Seizure of )
2013 Ford E350 Econoline,
)
VIN 1FBSS3BLXDDA56042
)

1:15MJ76

In the Matter of the Seizure of )
2014 Trailer,
)
VIN 5VGFG2421EL002571
)

1:15MJ77

In the Matter of the Seizure of )
2013 Ford E350 Econoline,
)
VIN 1FBSS3BL6DDA73811
)

1:15MJ78

In the Matter of the Seizure of )
2013 Ford E350 Econoline,
)
VIN 1FBSS3BL6DDA73923
)

1:15MJ79

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL0CDA76797
)

1:15MJ80

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL9CDA97194
)

1:15MJ81

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL9CDA58556
)

1:15MJ82

In the Matter of the Seizure of )
2011 Ford E350 EXL –
)
15 passenger,
)
VIN 1FBSS3BL4BDB11002
)

1:15MJ83

In the Matter of the Seizure of )
2012 Ford E350 Econoline,
)
VIN 1FBSS3BL5CDA76682
)

1:15MJ84

In the Matter of the Seizure of )
2014 Ford E350 Econoline,
)
VIN 1FTSS3EL8EDA59837
)

1:15MJ85

- 6 -

ORDER
This matter is before this court for review of the
Recommendation filed on January 18, 2017, by the Magistrate
Judge in accordance with 28 U.S.C. § 636(b). (Doc. 76.) In the
Recommendation, the Magistrate Judge recommends that Claimants’
Motions for the Return of Seized Property in 1:15MJ32 to
1:15MJ38, 1:15MJ40 to 1:15MJ45, and 1:15MJ49 through 1:15MJ85 be
denied and that Claimants’ Motions to Dismiss in 1:15CV152 (Doc.
10) and 1:15CV506 (Doc. 9) be denied. The Recommendation was
served on the parties to these actions on January 19, 2017.
Claimants filed objections within the time limit prescribed by
Section 636. Plaintiff filed a response to Claimants’
objections.
This court is required to Amake a de novo determination of
those portions of the [Magistrate Judge=s] report or specified
proposed findings or recommendations to which objection is made.@
28 U.S.C. § 636(b)(1).1 This court Amay accept, reject, or
modify, in whole or in part, the findings or recommendations

This court reads the objections to extend to the
entered by the Magistrate Judge granting the motion to
denying the motion to lift stay (Doc. 76 at 30). These
non-dispositive matters and, as a result, this court’s
under a “clearly erroneous” standard. See 28 U.S.C.
§ 636(b)(1)(A).
1

- 7 -

order
stay and
are
review is

made by the [M]agistrate [J]udge. . . . [O]r recommit the matter
to the [M]agistrate [J]udge with instructions.@ Id.
The court has appropriately reviewed Claimants’ objections
to the United States Magistrate Judge’s Recommendation. This
court has made a de novo determination which is in accord with
the Magistrate Judge=s Recommendation and finds the objections do
not change the substance of the United States Magistrate Judge’s
Recommendation. This court therefore adopts the Recommendation.
The court notes that Claimants subsequently filed Motions
to Supplement the Objections in each of these cases. Their
request will be allowed to the extent that the additional
objections will be considered. However, the court concludes that
even if the additional objections are considered, the analysis
and conclusion remain the same.
Nevertheless, this court has had the opportunity to review
the status report and the ex parte attachment (Docs. 79, 80),
both of which were filed following entry of the Magistrate
Judge’s recommendation. While the Magistrate Judge’s order is
eminently reasonable and appropriate under the circumstances,
this court finds in light of the recent filings that the order
should be modified to impose a stay for a definite period of
time rather than the process in place, requiring an updated

- 8 -

status report and basis for continuing the stay as previously
ordered.
The civil forfeiture action stayed by the Magistrate
Judge’s order is extensive, involving what appear to be
substantial personal and business assets. This criminal
investigation has apparently been pending since at least
sometime during 2014 when the Medicaid Investigations Division
began its investigation. (See Recommendation (Doc. 76) at 8.)
The forfeitures began in February 2015 when seizure warrants
were issued. (See id. at 10.) As described by another district
court in United States v. $307,970.00 in U.S. Currency, “the
status of the criminal investigation is fluid, and no charging
decision ha[s] been made. Under such circumstances, an
indefinite stay might adversely affect claimants’ due process
rights.” 156 F. Supp. 3d 708, 727 (E.D.N.C. 2016). As a result,
“the stay, as requested, is too indefinite. See, e.g., Landis v.
N. Am. Co., 299 U.S. 248, 257 (1936) (‘The stay is immoderate
and hence unlawful unless so framed in its inception that its
force will be spent within reasonable limits, so far at least as
they are susceptible to prevision and description.’).” United
States v. $307,970.00, 156 F. Supp. 3d at 726-27. This court
therefore modifies the terms of the stay to limit the period of
the stay for approximately 120 days, until August 1, 2017. At
- 9 -

the conclusion of that time, the parties will meet, confer, and
provide the court with a joint status report for moving forward
with the case, on or before July 15, 2017. Should the government
seek a continued stay of this case, any motion to that effect
shall be filed no later than July 1, 2017. Claimants may file a
response on or before July 15, 2017. No reply will be permitted.
IT IS THEREFORE ORDERED that the Magistrate Judge=s
Recommendation (Doc. 76) is ADOPTED except as modified herein.
IT IS FURTHER ORDERED that Claimants’ Motions and Supplemental
Motions for the Return of Seized Property in 1:15MJ32 to
1:15MJ38, 1:15MJ40 to 1:15MJ45, and 1:15MJ49 through 1:15MJ85
are DENIED and that Claimants’ Motions to Dismiss in 1:15CV152
(Doc. 10) and 1:15CV506 (Doc. 9) are DENIED.
IT IS FURTHER ORDERED that the Magistrate Judge’s order
granting the stay is AFFIRMED AS MODIFIED HEREIN.
IT IS FURTHER ORDERED that Claimants’ Motions to Supplement
their Objections to the Order and Recommendation are GRANTED to
the extent that the additional objections have been considered.
This the 31st day of March, 2017.

_______________________________________
United States District Judge

- 10 -