Ramsden v. U.S.

• Decision Date: 18 August 1993
• Docket Number: No. 92-55213,92-55213
• Citation: 2 F.3d 322
• Parties: Terence Philip RAMSDEN, Plaintiff-Appellee, v. UNITED STATES of America, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 322

2 F.3d 322

Terence Philip RAMSDEN, Plaintiff-Appellee, v. UNITED STATES of America, Defendant-Appellant.

No. 92-55213.

United States Court of Appeals Ninth Circuit.

Argued and Submitted July 14, 1993.

Decided Aug. 18, 1993.

Jean A. Kawahara, Asst. U.S. Atty., Los Angeles, CA, for defendant-appellant.

Deborah J. Lewis, Deputy Federal Public Defender, Los Angeles, CA, for plaintiff-appellee.

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

Before GIBSON ^*, HALL, and KLEINFELD, Circuit Judges.

CYNTHIA HOLCOMB HALL, Circuit Judge:

The Government appeals the district court's order granting Mr. Ramsden's motion for the return of illegally seized documents pursuant to Fed.R.Crim.P. 41(e). The district court had jurisdiction under 28 U.S.C. Sec. 1331. This court has jurisdiction under 28 U.S.C. Sec. 1291.

FACTUAL BACKGROUND

On July 23, 1991, the District Court for the Central District of California issued a provisional arrest warrant for Ramsden at the request of the British government. The warrant was based on the British government's investigation into charges that Ramsden engaged in fraudulent trading and false accounting in the United Kingdom.

Early on the morning of September 8, 1991, two deputy U.S. marshals went to Ramsden's hotel room to execute the warrant.

Escorted by two hotel security guards and the hotel manager, they went to Ramsden's room and knocked on the door. When Ramsden answered, the marshals requested that he step out into the hallway, where he was placed under arrest.

Ramsden was allowed to reenter his room in order to change clothes. The marshals escorted Ramsden inside at which point they noticed loose papers on a desk and on the floor surrounding the desk. They also noticed a suitcase and briefcase sitting near the desk. To confirm that there were no concealed weapons present, the marshals opened the suitcase and briefcase and saw that they contained miscellaneous documents. After consultation with the International Criminal Police Organization (Interpol), the marshals seized the documents in the room as potential evidence for the British authorities.

On September 12, 1991, a British official was given the opportunity to review a portion of the seized documents. He found numerous documents relevant to his office's investigation of Ramsden. On November 7, 1991, the United States Attorney's Office filed a request for Ramsden's extradition on behalf of the British government.

On September 30, 1991, Ramsden sought to have the seized documents returned pursuant to Rule 41(e). On December 9, 1991, following full briefing and a hearing, the district court granted Ramsden's motion. It recognized that the Government had a legitimate interest in retaining the documents: maintaining relations with the United Kingdom by aiding the British government in its prosecution of Ramsden. However, the district court concluded that under the circumstances equity demanded that the seized documents be returned to Ramsden without giving the Government the opportunity to copy them.

STANDARD OF REVIEW

We review the district court's decision to exercise its equitable jurisdiction under Rule 41(e) for abuse of discretion. See Kiesel Co., Inc. v. Householder, 879 F.2d 385, 388 (8th Cir.1989); Richey v. Smith, 515 F.2d 1239, 1243 (5th Cir.1975). "We review the district court's interpretation of Rule 41(e) de novo." United States v. Mills, 991 F.2d 609, 612 (9th Cir.1993) (citing In re Grand Jury Subpoenas Dated Dec. 10, 1987, 926 F.2d 847, 855 (9th Cir.1991)).

DISCUSSION

I

A. District Court Jurisdiction

In the instant case, the district court concluded that criminal proceedings had not been instituted against Ramsden at the time he filed his Rule 41(e) motion. ¹ Ordinarily, Rule 41(e) is used to seek the return of seized property after an indictment has been issued. Black Hills Institute v. Dept. of Justice, 967 F.2d 1237, 1239 (8th Cir.1992). Nonetheless, district courts have the power to entertain motions to return property seized by the government when there are no criminal proceedings pending against the movant. United States v. Martinson, 809 F.2d 1364, 1366-67 (9th Cir.1987). These motions are treated as civil equitable proceedings and, therefore, a district court must exercise "caution and restraint" before assuming jurisdiction. Kitty's East v. United States, 905 F.2d 1367, 1370 (10th Cir.1990).

To prevent the district courts from exercising their equitable jurisdiction too liberally, the circuit courts have enumerated certain factors that must be considered before a district court can reach the merits of a preindictment Rule 41(e) motion. In Richey v. Smith, 515 F.2d 1239 (5th Cir.1975), the In the instant case, the district court utilized the Fifth Circuit's approach, and considered all four factors. In finding that the Government displayed callous disregard for Ramsden's rights the district court relied in large part on the Government's admission that the search and seizure violated Ramsden's Fourth Amendment rights. No warrant was obtained and no exception to the warrant requirement was applicable. In addition, the district court found that although the Government had the opportunity to secure a warrant, it simply chose not to comply with its obligations under the Fourth Amendment. Under these circumstances, we do not think the district court erred in concluding that the Government exhibited callous disregard for Ramsden's constitutional rights.

                Fifth Circuit listed four factors that a district court should consider in deciding whether to entertain a Rule 41(e) motion made prior to the initiation of criminal proceedings.  These factors include:  1) whether the Government displayed a callous disregard for the constitutional rights of the movant;  2) whether the movant has an individual interest in and need for the property he wants returned;  3) whether the movant would be irreparably injured by denying return of the property;  and 4) whether the movant has an adequate remedy at law for the redress of his grievance.  Id. at 1243-44.   See also Kiesel Company, Inc. v. Householder, 879 F.2d 385, 387 (8th Cir.1989) (movant must establish callous disregard of the Fourth Amendment, irreparable injury if relief is not granted, and lack of an adequate remedy at law);  Kitty's East, 905 F.2d at 1370-71 (movant must establish irreparable injury if he is deprived of his property and lack of an adequate remedy at law)
                

The Government challenges this finding, arguing that the marshals' conduct was objectively reasonable in light of the legal rules that were clearly established at the time. This argument is unpersuasive. The Ninth Circuit has established that law enforcement authorities are barred from conducting a warrantless search of an individual's hotel room after arresting him in the hallway absent certain recognized exceptions to the warrant requirement. United States v. Whitten, 706 F.2d 1000, 1016 (9th Cir.1983), cert. denied, 465 U.S. 1100, 104 S.Ct. 1593, 80 L.Ed.2d 125 (1984). These exceptions do not apply here. The Government is unable to establish that exigent circumstances were present, that entry into Ramsden's hotel room qualified as a search incident to an arrest, or that Ramsden consented to the marshal's entry into the room. ² Id. Thus, the marshals' conduct cannot be excused on the ground that it was objectively reasonable in light of clearly established law.

The district court did not make an express finding concerning the second Richey factor. However, we conclude that Ramsden has established an individual interest in and need for the documents. This interest derives from the fact that the documents are necessary for Ramsden to run his business.

Turning to the third Richey factor, the district court concluded that Ninth Circuit does not require a finding of irreparable injury. However, the factors a district court should consider in deciding whether to exercise its equitable jurisdiction are a question of first impression in this circuit. We agree with the Fifth, Eighth, and Tenth Circuits that a district court must determine whether a movant will suffer irreparable injury when considering whether to reach the merits of a preindictment Rule 41(e) motion.

Ramsden offers two reasons why he will suffer irreparable injury if the seized documents are not returned to him. First, he contends that without the papers he cannot run his business, which in turn will make it impossible for him to support his family. Although this establishes an individual interest in the documents, it does not follow that Ramsden will suffer irreparable injury if the documents are not returned. Rather, the district court properly discounted this injury Ramsden also claims that he will suffer irreparable harm if the documents are not returned because they may lead to his prosecution in England. The district court held that the threat of prosecution is ordinarily not enough to constitute irreparable injury. Both the Eighth and Tenth Circuits have taken this position. See Householder, 879 F.2d at 389; Blinder, Robinson, 897 F.2d at 1557. As the court in Householder observed, if the mere threat of prosecution were allowed to constitute irreparable harm, every potential defendant could point to the same harm and invoke the equitable powers of the district court. In this sense, the district court's exercise of its equitable jurisdiction would not be extraordinary, but instead quite ordinary. Householder, 879 F.2d at 389.

by recognizing that Ramsden failed to establish that copies of the documents would not fulfill his business needs. See Blinder, Robinson & Co., Inc. v. United States, 897 F.2d 1549, 1557 (10th Cir.1990).

In contrast, the Fifth Circuit has held that the threat of future prosecution can constitute irreparable harm. In Richey, the court stated that "a wrongful indictment is no laughing matter; often it works a grievous, irreparable injury to the...