900 F.2d 1402 (9th Cir. 1990), 86-6233, United States v. $84,740.00 United States Currency

Docket Nº:86-6233.
Citation:900 F.2d 1402
Party Name:UNITED STATES of America, Plaintiff/Appellee, v. $84,740.00 U.S. CURRENCY, Defendant. Appeal of Doris POTTER, Administrator of Estate of Edwin Potter, Deceased, Claimant.
Case Date:April 16, 1990
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 1402

900 F.2d 1402 (9th Cir. 1990)

UNITED STATES of America, Plaintiff/Appellee,

v.

$84,740.00 U.S. CURRENCY, Defendant.

Appeal of Doris POTTER, Administrator of Estate of Edwin

Potter, Deceased, Claimant.

No. 86-6233.

United States Court of Appeals, Ninth Circuit

April 16, 1990

Argued and Submitted April 3, 1989.

Page 1403

Felicia C. Curran and Bernard Knapp, Law Offices of Jerrold M. Ladar, San Francisco, Cal., for claimant-appellant.

Roger E. West, Asst. U.S. Atty., Los Angeles, Cal., for plaintiff/appellee.

Appeal from the United States District Court for the Central District of California.

Before WALLACE and FLETCHER, Circuit Judges, and MUECKE, [*] District Judge.

OPINION

MUECKE, Senior District Judge:

This is an appeal from the district court's denial of motion to set aside default judgment under Fed.R.Civ.P. 60(b)(5) and (6). The district court ruled that it lacked jurisdiction to set aside a default judgment because the government had transferred the money to the United States Treasury.

I. BACKGROUND

The government indicted Edwin Potter for a violation of the Drug Abuse Control Act, 21 U.S.C. Sec. 801 et seq. (1982). When the government arrested him, it also seized $84,740 in cash.

On November 3, 1983, the government filed a civil action seeking the forfeiture of the money pursuant to 21 U.S.C. Sec. 881(a)(6) (1982). 1 Attached to the complaint is a verification form captioned "Verification of Interrogatories." The relevant portion of the verification states:

  1. I have read the above Answers to Interrogatories and know the contents thereof; and

  2. The Answers to Interrogatories set forth above are true and correct to the best of my knowledge and are based on information obtained from official sources within the United States Government and from files and records in its possession.

I declare under penalty of perjury that the foregoing is true and correct.

The verification is signed by the same person who signed the complaint and is dated the same day as the complaint. No other verification has been filed.

The government served Edwin Potter by certified letter at the Federal Correctional Institution in San Pedro, California. The government also served the forfeiture complaint on Edwin and Doris Potter by sending two certified letters to a post office box. Doris Potter signed for both letters. In addition, the government served by publication of a notice in the Los Angeles Daily Journal.

Page 1404

The Potters did not file a claim to the money or file an answer. On March 29, 1984, the district court entered default judgment and the money was forfeited to the United States Treasury. On April 28, 1986, the estate of Edwin Potter (appellant) filed a motion to abate the forfeiture. The district court denied appellant's motion.

Appellant timely appealed the district court's order.

II. STANDARD OF REVIEW

This court reviews de novo the district court's conclusion that it lacked the subject matter jurisdiction. See State of California v. United States Dept. of Navy, 845 F.2d 222, 223 (9th Cir.1988).

III. DISCUSSION

A civil forfeiture case filed pursuant to 21 U.S.C. Sec. 881 is considered to be an action in rem. See United States v. Ten Thousand Dollars in United States Currency, 860 F.2d 1511, 1513 (9th Cir.1988) (hereinafter Ten Thousand Dollars ). The general rule is that upon the removal of the res, the jurisdiction of the court ends. See id. Once the res is released from the court's control, the court is powerless to effectuate a remedy because it no longer has jurisdiction to order the return of the property. See United States v. 66 Pieces of Jade, 760 F.2d 970, 973 (9th Cir.1985). The only exception to the general rule is if the res is removed accidentally, fraudulently, or improperly. See Ten Thousand Dollars, 860 F.2d at 1513.

Appellant argues that the district court should have granted its motion to vacate entry of default judgment because the money was removed improperly. Appellant asserts that the money was improperly...

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