United States of America v. One Rolex 18K Gold Watch et al

Filing 40

OPINION AND ORDER. GRANTED in part and DENIED in part 37 MOTION for Attorney Fees filed by Cindy M. Morales-Calderon, Manuel A. Chevres-Motta. Signed by Judge Salvador E Casellas on 3/17/2010.(LB)

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I N THE UNITED STATES DISTRICT COURT F O R THE DISTRICT OF PUERTO RICO U N I T E D STATES OF AMERICA, Plaintiff v. Civil No. 08-1339 (SEC) O n e Rolex 18k Gold Watch with light b r o w n crocodile style wrist band, et seq., D e f e n d a n ts

O P I N IO N and ORDER 11 P e n d in g before this Court is Claimant Cindy Morales-Calderón's ("Claimant or 12 " M o ra le s -C a ld e ro n " ) Petition for Attorney's Fees Pursuant to 28 U.S.C. § 2465(b)(1) (Docket 13 # 37), and the United States' ("Government") opposition thereto (Docket # 38). After reviewing 14 th e filings, and the applicable law, Claimants' motion is GRANTED in part and DENIED in 15 p a r t. 16 Factual and Procedural Background 17 O n March 18, 2008, Plaintiff filed a civil action in rem against the jewelry that was 18 19 A c t, 21 U.S.C. § 881 (a)(6) (2009). The Government sought the forfeiture of the property 20 a c q u ire d with proceeds traceable to the exchange of controlled substances, and/or was used to 21 f a c ilita te drug trafficking activities in violation of said Act. Docket # 1. 22 O n July 2, 2008, Chevres-Motta plead guilty to the criminal indictment charging him for 23 a id in g and abetting in the selling, distributing or dispensing of illegal narcotics, in violation of 24 th e Controlled Substances Act, 21 U.S.C. §§ 841 (a)(1), and (b)(1)(A), 846 (2009). The 25 26
1

s e iz e d from Manuel Chevres-Motta ("Chevres-Motta"),1 pursuant to the Controlled Substances

Claimant Cindy Morales-Calderón is Chevres-Motta's wife.

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G o v e rn m e n t asserts that, as a stipulation in the criminal case, Chevres-Motta also agreed to f o r f e i t the assets mentioned in Count 28 of the criminal indictment. Count 28 of the criminal in d ic tm e n t stated that each convicted defendant would forfeit to the United States his or her rig h ts , title, and interest in any, and all property involved in offenses in violation of the C o n tro lle d Substances Act. See Indictment of Claimant Chevres-Motta at 22, No. 07-395 (D. P .R filed July 2, 2008). The Government posits that, given the above, the seized jewelry should b e deemed properly forfeited. On September 9, 2008, Chevres-Motta and Morales-Calderon moved for summary j u d g m e n t, arguing that the jewelry was seized without a warrant. Docket # 12. They further a rg u e d that neither the arrest warrant for Chevres-Motta, nor the consent to search Claimants' re sid e n c e given by Morales-Calderón, authorized the seizure of said jewelry. Lastly, they a v e rre d that the jewelry was purchased prior to the span of time in which the criminal activities to o k place, with proceeds from their business, Scooter Factory Shop, located in Naranjito, P u e rto Rico. As a result thereof, they argued that the jewelry was not purchased with proceeds g e n e ra te d from illegal activity, and therefore, they were illegally seized, and forfeiture is im p ro p e r. On December 3, 2008, the Government opposed Chevres-Motta and Morales-Calderon's motion for summary judgment, and also filed a cross-motion for summary judgment. Docket # # 16 and 17. This Court granted Chevres-Motta and Morales-Calderon's motion for summary ju d g m e n t, and denied the Government's cross-motion. Docket # 26. On October 20, 2009, C h e v re s -M o tta and Morales-Calderon's counsel filed a motion for attorney's fees. Docket # 37. Standard of Review C o n g re s s enacted the Civil Asset Forfeiture Reform Act of 2000 in response to the public p e rc e p tio n that the Government was over-reaching in civil and criminal forfeiture proceedings. U n ite d States v. 2007 Bmw 335i Convertible, VIN: WBAWL73547PX47374, 648 F. Supp. 2d 9 4 4 , 947 (N.D. Ohio 2009); see also United States v. Khan, 497 F.3d 204, 208 (2nd Cir. 2007).

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T h e relevant section of CAFRA, 28 U.S.C. § 2465, provides, in pertinent part: Upon the entry of a judgment for the claimant in any proceeding to condemn or f o rf e it property seized or arrested under any provision of Federal law­ .... (b)(1) Except as provided in paragraph (2), in any civil proceeding to forfeit p ro p e rty under any provision of Federal law in which the claimant substantially p re v a ils , the United States shall be liable for-(A ) reasonable attorney fees and other litigation costs reasonably incurred by the c la im a n t... T h e re f o re , under CAFRA, a claimant who substantially prevails in a civil forfeiture proceeding is entitled to "reasonable attorney fees and other litigation costs reasonably incurred," as well a s post-judgment interest. 28 U.S.C. § 2465(b)(1). The CAFRA fee-shifting provision seeks to " to make federal civil forfeiture procedures fair to property owners and to give owners innocent o f any wrongdoing the means to recover their property and make themselves whole after w ro n g f u l government seizures." United States v. Certain Real Prop., 579 F.3d 1315, 1322 (11th C ir. 2009). O n its face, the language of CAFRA's fee-shifting provision appears to contemplate only th e award of attorney fees incurred in civil forfeiture actions. United States v. Certain Real P ro p ., 579 F.3d 1315, 1320 (11th Cir. 2009). Pursuant to Section 881(a), 21 U.S.C. § 881(a), th e Government may file a civil forfeiture action to seize property used to facilitate any v io la tio n of title 21, including "moneys, negotiable instruments, securities, or other things of v a lu e furnished or intended to be furnished by any person in exchange for a controlled substance o r listed chemical in violation of this title, all proceeds traceable to such an exchange, and all m o n e ys , negotiable instruments, and securities used or intended to be used to facilitate any v io la tio n of this title." A claimant that prevails in a Section 881(a) civil forfeiture action, is e n title d to attorney's fees. See 2007 Bmw, 648 F. Supp. 2d at 949; United States v. 662 Boxes o f Ephedrine, 590 F. Supp. 2d 703, 709 (D. N.J. 2008). T h e First Circuit has held that "[w]hen fee-shifting is in prospect, `district judges have g re a t discretion in deciding what claimed legal services should be compensated.'" United States

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v . One Star Class Sloop Sailboat, 546 F.3d 26, 37 (1st Cir. 2008) (citing Brewster v. Dukakis, 3 F.3d 488, 492 (1st Cir. 1993). Similarly, when dealing with a fee-shifting statute, "courts typic a lly ascertain reasonable attorneys' fees by means of the lodestar method.'" One Star Class, 5 4 6 F.3d at 38 (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). This entails

" m u ltip lyin g the number of hours productively spent by a reasonable hourly rate." Id. (citing T o rre s-R iv e ra v. O'Neill-Cancel, 524 F.3d 331, 336 (1st Cir. 2008). After determining the time re a s o n a b ly expended by the prevailing party's counsel, the court must focus on the rates to be a p p lie d to those hours. O'Neill-Cancel, 524 F.3d at 336-337. R e a s o n a b le hourly rates "vary depending on the nature of the work, the locality in which it is performed, the qualifications of the lawyers, and other criteria." One Star Class, 546 F.3d a t 38. Thus "the prevailing market rates in the relevant community," are an adequate starting p o in t. Id. at 40. On this front, "the rate that private counsel actually charges for her services, w h ile not conclusive, is a reliable indicium of market value." Id. at 40. Therefore, courts may u s e "counsel's standard rate, or the prevailing market rate in the forum, or a reasonable rate in b e tw e e n ." Id. at 41. After "the basic lodestar is calculated, the court may adjust it, up or down, to reflect other c o n s id e ra tio n s , such as the results obtained," Id. at 38 (citing Coutin v. Young & Rubicam P.R., In c ., 124 F.3d 331, 337, n. 3 (1st Cir. 1997), and "the time and labor actually required for the e f f ic a c io u s handling of the matter." O'Neill-Cancel, 524 F.3d at 336. The court may also adjust th e award considering the novelty and difficulty of the questions, the skill requisite to perform th e legal services properly; the preclusion of other employment by the attorney(s) due to a c c e p ta n c e of the case; the customary fee; the nature of the fee (fixed or contingent); the time lim ita tio n s imposed by the client or the circumstances; the amount involved and the results o b ta in e d ; the experience, reputation, and ability of the attorney(s); the "undesirability" of the c a s e ; the nature and length of the professional relationship with the client; and the size of a w a rd s in similar cases. Guillemard-Ginorio v. Contreras, 603 F. Supp. 2d 301, 310 (D.P.R.

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2 0 0 9 ) (citations omitted); see also Coutin v. Young & Rubicam Puerto Rico, Inc., 124 F.3d 331, 3 3 7 -3 8 n.3 (1st Cir. 1997). Furthermore, in analyzing the "number of hours productively spent, th e court should `eliminate time that was unreasonably, unnecessarily, or inefficiently devoted to the case' and may, under appropriate circumstances, `disallow time spent in litigating failed c la im s .'" One Star Class, 546 F.3d at 38 (citations omitted). U n d e r CAFRA, fees "are not subject to a statutory hourly limit, in contrast with fee a w a rd s under the EAJA." United States v. 4,432 Mastercases of Cigarettes, 322 F. Supp. 2d 1 0 7 5 , 1078 (C.D. Cal. 2004) (vacated on other grounds in United States v. 4,432 Mastercases o f Cigarettes, 448 F.3d 1168 (9th Cir. 2006) (citing U.S. v. $ 60,201.00 U.S. Currency, 291 F. S u p p . 2d 1126, 1130 (C.D. Cal. 2003)). Instead, under 28 U.S.C. § 2465(b)(1), the moving party " m u s t show that the hourly rates charged are `in line with those prevailing in the community for s im ila r services by lawyers of reasonably comparable skill, experience and reputation.'" Id. at 1 0 7 8 (citing $ 60,201.00, 291 F. Supp. 2d at 1130). In order to receive the proper award of attorneys fees, a prevailing party must submit w ith its motion evidence to support the number of hours and rates sought, including specific in f o rm a tio n about number of hours, dates, and the nature of the work performed, and show that th e rates being sought are comparable to those in the community. Guillemard-Ginorio, 603 F. S u p p . 2d at 317 (citing Hensley, 461 U.S. at 433). The Supreme Court has held that "[w]here th e documentation of hours is inadequate, the district court may reduce the award accordingly." Id . (Citing Hensley, 461 U.S. at 433). A p p lic a b le Law and Analysis In their opposition, the Government argues that insofar as Chevres-Motta was convicted f o r underlying criminal drug trafficking offenses, he is not entitled to recover attorney's fees. T h e y further point out that Chevres-Motta was not married at the time of his conviction and s e n te n c in g . Moreover, according to the Government, Claimant's motion addresses work in v o lv e d in Chevres-Motta's criminal case, and 28 U.S.C. § 2465(b)(1) does not provide for

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a tto rn e ys fees for work performed in a criminal case. After reviewing the record, and the applicable law, this Court first notes that Claimant's re q u e st for attorneys fees does not seek payment for work related to the criminal case, and p re s e n t counsel was not involved in any aspect of Chevres-Motta's defense in the criminal case. Furthermore, counsel for Plaintiffs had an obligation to review the criminal case's docket in o rd e r to properly defend Claimants in the present action. As such, the Government's arguments o n this front fail. Secondly, although CAFRA does "not apply if the claimant is convicted of a crime for w h ic h the interest of the claimant in the property was subject to forfeiture under a Federal c rim in a l forfeiture law," 28 U.S.C. § 2465(b)(2)(B); see also United States v. Khan, 497 F.3d 2 0 4 , 209 (2d Cir. 2007), Morales-Calderon was not convicted in the criminal proceedings. T h e re f o re , attorney's fees are appropriate in this case. In determining the reasonable hourly rate, we first note that hourly rates depend on those p re v a ilin g in the community by lawyers with comparable skill, experience and reputation, as w e ll as whether the time was invested in-court or out-of-court. Guillemard-Ginorio, 603 F. S u p p . 2d at 311-312 (awarding $225.00 for in-court appearances and $200.00 for out-of-court w o rk to attorney with 22 years experience) (citing Ciudadana v. Gracia-Morales, 359 F. Supp.2d 3 8 , 45 (D.P.R. 2005)(finding rates of $ 200.00 an hour for out-of- court work and $ 225.00 an h o u r in-court work justified); International College of Business and Technology, Inc., 356 F. S u p p .2 d 92, 96-97 (D.P.R. 2005) (finding rate of $ 190 and $ 125 to be appropriate); Top E n te rta in m e n t Corp. v. Torrejon, 349 F. Supp.2d 248, 253-255 (D.P.R. 2004) (finding hourly ra te of $ 125.00 reasonable); Anywhere, Inc. v. Romero, 344 F. Supp.2d 345, 348 (D.P.R. 2004) (f in d in g that an hourly rate of $ 250.00 for the more experienced attorney and of $ 150.00 for th e less experienced attorneys reasonable); Vieques Conservation and Historical Trust, Inc. v. M a rtin e z , 313 F. Supp.2d 40, 47 (D.P.R. 2004) (reducing attorney's hourly rate to $ 225 to e q u a te with local rates); Rodriguez-Sostre v. Municipio de Canovanas, 251 F. Supp.2d 1055,

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1 0 5 8 (D.P.R. 2003) (awarding $ 225.00 to $250.00 for in-court time and $ 200.00 for o u t-o f -c o u rt time)); see also U.S. District Court for the District of Puerto Rico's Notice of the C le rk No. 10-01, Hourly Rates and Case Maximum Increases for Criminal Justice Act (CJA) P a n e l Attorneys (setting $125.00 hourly fee for non-capital cases, and $178.00 for capital c a se s). In the present case, Claimant's counsel has been practicing law since 1981, and handled f e d e ra l forfeiture cases since 2000. Considering his 25 years of litigation experience, and the f o re g o in g case law, this Court finds that $225.00 for out-of-court work is a reasonable rate. M o re o v e r, upon reviewing the record, this Court also finds that the motion submitted by C la im a n t properly supports the number of hours and rates sought, and includes specific in f o rm a tio n about number of hours, dates, and the nature of the work performed in the case. We see no reason for a reduction of hours, especially considering that Claimant's counsel re q u e sts only 30.41 hours, and that Claimant prevailed on all fronts. As such, Claimant's c o u n s e l is awarded $6,842.25 in attorney's fees. C o n c lu s io n B a s e d on the foregoing, Claimant's petition for attorney's fees is GRANTED in part a n d DENIED in part, and Claimant's counsel is awarded $6,842.25 in attorney's fees I T IS SO ORDERED. S a n Juan, Puerto Rico, this 17 th day of March, 2010. S /S a lv a d o r E. Casellas S a lv a d o r E. Casellas U .S . Senior District Judge