US v. PREMISES KNOWN AS LOTS 50 & 51 ETC.

• Decision Date: 01 March 1988
• Docket Number: No. 87-753-CIV-5.,87-753-CIV-5.
• Citation: 681 F. Supp. 309
• Court: U.S. District Court — Eastern District of North Carolina
• Parties: UNITED STATES of America, Plaintiff, v. PREMISES KNOWN AS LOTS 50 & 51, 2050 BRICKELL AVENUE, MIAMI, FLORIDA, etc., et al., Defendants.

681 F. Supp. 309

UNITED STATES of America, Plaintiff, v. PREMISES KNOWN AS LOTS 50 & 51, 2050 BRICKELL AVENUE, MIAMI, FLORIDA, etc., et al., Defendants.

No. 87-753-CIV-5.

United States District Court, E.D. North Carolina, Raleigh Division.

March 1, 1988.

Stephen A. West, Asst. U.S. Atty., Raleigh, N.C., for plaintiff.

Gordon Widenhouse, Purser, Cheshire, Parker, Hughes & Dodd, Raleigh, N.C., for defendants.

ORDER

BRITT, Chief Judge.

This matter is before the court on claimants' motions to dismiss pursuant to Rules 12(b)(2) and 12(b)(5) of the Federal Rules of Civil Procedure. Delia and Dario Londono (hereinafter claimants) argue that this court lacks personal jurisdiction over the defendant res and, alternatively, that service of process by plaintiff was defective because the res is outside this court's jurisdiction. The issues have been fully briefed, and the matter is now ripe for disposition.

FACTS

The United States of America brought this action seeking the civil forfeiture of certain real property located in the Southern District of Florida pursuant to Title 21, United States Code, Section 881(a)(7). On or about 12 October 1987 claimants filed claims to defendant property pursuant to Supplemental Rule for Certain Admiralty and Maritime Claims, C(6).

The amended complaint alleges that the defendant premises were "used or intended to be used to facilitate the commission of a violation of the Controlled Substances Act ... in that Dario and Delia Londono would and did knowingly or intentionally use communication facilities, including ... equipment located in and on defendant premises to commit or facilitate the commission of an act or acts constituting felonies under the Controlled Substances Act," specifically, a conspiracy to unlawfully import into the United States a Schedule II controlled substance, to wit: cocaine, in excess of one kilogram, in violation of 21 U.S.C. §§ 960 & 963 and 21 U.S.C. § 843(b). An indictment filed in the Eastern District of North Carolina on 27 March 1987 charged Dario Londono with criminal acts involving the defendant property and arguably formed the basis of this civil forfeiture action. Dario Londono pled guilty to counts one and eight of the superseding indictment. Count one charged him with conspiracy to unlawfully import cocaine, and one of the overt acts alleged that a meeting took place in July 1985 in Miami, Florida, at the defendant premises. Delia Londono, who is alleged to have had knowledge, was a consenting party to the use of the defendant premises to facilitate the illegal conspiracy.

Plaintiff alleges that jurisdiction is predicated upon 28 U.S.C. §§ 1345 and 1355 and that venue is proper under 21 U.S.C. § 881(j).

DISCUSSION

Claimants' motion to dismiss for lack of jurisdiction over the defendant res requires that the court consider the extent of its in rem jurisdiction in light of the recently enacted venue provision of 21 U.S.C. § 881. Under subsection (j) proper venue for a forfeiture proceeding has been greatly expanded. Specifically, 21 U.S.C. § 881(j) provides that in addition to venue already provided for in 28 U.S.C. § 1395, etc., a "proceeding for forfeiture under this section may be brought in the judicial district in which the defendant owning such property is found or in the judicial district in which the criminal prosecution is brought."

The principal question before the court is: What are the territorial limits of a United States district court's jurisdiction in in rem proceedings involving forfeitures under 21 U.S.C. § 881? This question was presented to another district court in United States v. One 1974 Cessna Model 310R Aircraft, 432 F.Supp. 364 (D.S.C.1977); however, that was prior to the enactment of 881(j) and did not involve real property. As noted by that court, the question is simple; the constitutional issues it raises are not.

The exercise of jurisdiction is a function of several things, including physical and political power. It is limited by principles of fairness which have been defined as reasonable notice and some relationship to the forum exercising power. These principles are embodied in the due process clause. See Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977); International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945).

In addition to constitutional limitations, Congress may also specify when jurisdiction may be exercised. The court is well aware of the general propriety of congressional control of federal court jurisdiction. See Sheldon v. Sill, 8 How. 441, 12 L.Ed. 1147 (1850). The exercise of that control, however, is subject to constitutional scrutiny. See Marbury v. Madison, 1 Cranch 137, 2 L.Ed. 60 (1803). Accordingly, the court will examine this statute in light of general principles governing federal court territorial jurisdiction and minimum requirements under the Fifth Amendment of the Constitution.

The historical concept of territorial jurisdiction was largely parochial. "The territorial jurisdiction of courts was based upon the presence of a person or thing within the legal boundaries of the government that created the court. Pennoyer v. Neff, 95 U.S. (5 Otto) 714, 24 L.Ed. 565 (1877)." Restatement of Law 2d Judgments, 1982 Ed., ch. 2, Validity of Judgments, Introductory Note, p.22. This narrow view has been largely discredited and current law utilizes a "minimum contacts" analysis rather than a strictly geographical one. See Shaffer v. Heitner, supra; cf. Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); but see Restatement of Law 2d Judgments, § 4 "Constitutional and Legislative Determinants of Territorial Jurisdiction", p. 60 (1982 Ed.). In fact, there is authority for the proposition that because the United States is exercising its judicial power, it "need not demonstrate the minimum contacts with the forum state required by International Shoe." United States v. Irvine & Associates, Inc., 645 F.Supp. 845, 848 (E.D.Va.1986), citing Gilbert v. Bagley, 492 F.Supp. 714, 746-747 (M.D.N.C.1980).¹

As previously noted, this statute enables the government to seize property used or intended to be used in connection with a violation of the Controlled Substances Act. "A primary goal of this forfeiture statute is to cripple illegal drug trafficking and narcotics activity." United States v. One 1972 Datsun Vehicle ID No. LB1100355950, 378 F.Supp. 1200, 1205 (D.N.H.1974); see also House Report as set forth in 1950 U.S. Code Cong. Serv., pp. 2953-2954.

The operation of 21 U.S.C. § 881, if it is to effect congressional intent and fulfill its primary goal, must be flexible and extensive. With the expansion of drug trafficking in the United States and the not unlimited government resources available to combat it, Congress saw the necessity of amending 21 U.S.C. § 881 to facilitate the effective operation of the statute. It did so by expanding venue.

This expansion was not without regard for the constitutional rights of potential defendant-claimants. Indeed, the legislative history notes that "while this amendment would depart with tradition, it should not be viewed as unconstitutional since it is likely not only to provide a more convenient forum for both the government and the defendant-claimant, but also better notice to the defendant-claimant." 130 Cong. Rec. S267 (daily ed. Jan. 26, 1984).

The new venue provision as structured reflects the relationship between the property sought and the district court where the forfeiture proceeding is brought. Title 21, United States Code, Section 881(j) provides that a forfeiture proceeding may be brought where a defendant-claimant is found. This does not present great constitutional difficulty. Even though this is an in rem proceeding, the "judicial jurisdiction over a thing" is a "customary elliptical way of referring to jurisdiction over the interests of persons in a thing." Restatement 2d Conflict of Laws § 56, Introductory Note, p. 192 (1971 Ed.) (emphasis added). Focusing solely on the location of the property ignores both the purpose of forfeiture proceedings and the real interests at stake, those of the person, not the property.

Title 21, United States Code, Section 881(j) also provides that a forfeiture proceeding may be brought where the criminal prosecution is brought. This provision also presents no constitutional problem. The fact of criminal prosecution in a certain district indicates that an act in violation of the Controlled Substances Act occurred there and, therefore, anyone involved in the criminal act should reasonably expect to be subject to the exercise of jurisdiction in that district. This should extend to unindicted co-conspirators since their participation in an illegal drug enterprise extending beyond a given border reasonably subjects them to jurisdiction in a district where further illegal activities take place.

The relationship between the defendant-claimant and the forum under either provision is a reasonable one within the meaning of the due process clause. See Hanson v. Denckla, supra.

The fact that the property is real property is of no moment when the jurisdiction exercised is that of the federal sovereign. Cf. Keene v. United States, 5 Cranch 304, 3 L.Ed. 108 (1809) ("It is well settled that a proceeding in rem against specific property is local in character and must be brought where the property is subject to seizure under process of the court.") Parochial concerns and distinctions between local and transitory actions have no particular relevance in the context of forfeiture proceedings under this statute. As noted by the court in Cessna:

The doctrine of physical presence has no more inherent viability in the case of in rem jurisdiction than it did in the case of in personam jurisdiction in International Shoe.... The common law principle that in rem jurisdiction may only be exercised when the res is before the court need not be disputed, but it must be

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