U.S. v. $100,348.00 in U.S. Currency

• Decision Date: 16 January 2004
• Docket Number: No. 02-55330.,No. 02-55364.,No. 02-55363.,02-55330.,02-55363.,02-55364.
• Citation: 354 F.3d 1110
• Parties: UNITED STATES of America, Plaintiff-Appellant, Eytan Mayzel, Claimant-Appellee, v. $100,348.00 IN U.S. CURRENCY, Defendant. United States of America, Plaintiff-Appellee, Eytan Mayzel, Claimant-Appellant, v. $100,348.00 in U.S. Currency, Defendant. United States of America, Plaintiff-Appellee, Eric Amiel, Claimant-Appellant, v. $100,348.00 in U.S. Currency, Defendant.
• Court: U.S. Court of Appeals — Ninth Circuit

354 F.3d 1110

UNITED STATES of America, Plaintiff-Appellant, Eytan Mayzel, Claimant-Appellee, v. $100,348.00 IN U.S. CURRENCY, Defendant.

United States of America, Plaintiff-Appellee, Eytan Mayzel, Claimant-Appellant, v. $100,348.00 in U.S. Currency, Defendant.

United States of America, Plaintiff-Appellee, Eric Amiel, Claimant-Appellant, v. $100,348.00 in U.S. Currency, Defendant.

No. 02-55330.

No. 02-55363.

No. 02-55364.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted February 3, 2003.

Filed January 16, 2004.

COPYRIGHT MATERIAL OMITTED

John S. Gordon, Assistant United States Attorney, and Janet C. Hudson, Assistant United States Attorney, Los Angeles, CA, for the plaintiff-appellant-cross-appellee.

Eric Honig, Marina del Rey, CA, for claimant-appellee-cross-appellant Eytan Mayzel.

Elizabeth N. Rafeedie, Malibu, CA, for claimant-appellee-cross-appellant Eric Amiel.

Appeal from the United States District Court for the Central District of California, Ronald S.W. Lew, District Judge, Presiding. D.C. No. CV-00-08921-RSWL.

Before: D.W. NELSON, WARDLAW and FISHER, Circuit Judges.

WARDLAW, J., authored the opinion of the Court as to Parts I, II, III, IV, V, VII and VIII in which D.W. NELSON, J., and FISHER, J., join. FISHER, J., authored the opinion of the Court as to Part VI, in which D.W. NELSON, J., joins.

WARDLAW, J., filed a dissenting opinion as to Part VI.

WARDLAW, Circuit Judge, with whom D.W. NELSON, J., and FISHER, J., Circuit Judges, join:

These consolidated appeals from the district court's forfeiture order present the novel question whether the "lawful possessor" of seized currency who has Article III standing to contest the seizure in a civil forfeiture proceeding is the proper party to make an Eighth Amendment Excessive Fines challenge to the amount forfeited. The majority of the panel answers this question in the affirmative. Each of the parties asserts other challenges to the district court's order. Eytan Mayzel, the "lawful possessor," argues that the district court erred by: (1) employing the incorrect standard of proof due to the enactment of the Civil Asset Forfeiture Reform Act of 2000; (2) granting summary judgment against him on all issues except the Eighth Amendment claim; (3) ordering even partial forfeiture of the seized funds as a violation of the Excessive Fines Clause; and (4) denying his request for attorney's fees under the Equal Access to Justice Act. Eric Amiel, an individual who asserted ownership of the seized funds more than nine months past the deadline, argues that the district court abused its discretion in striking his untimely and unverified claim. The government, in turn, asserts that the district court should have ordered forfeiture of the seized funds in their entirety.

For the reasons we explain below, we hold that the district court employed the correct standard of proof, appropriately granted summary judgment, properly denied attorney's fees, and did not abuse its discretion in denying Amiel's untimely, unverified claim for the funds. The majority further holds that the forfeited amount was not constitutionally excessive. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm the district court's order.

I. Background

On February 29, 2000, Eytan Mayzel, a 25-year-old Israeli citizen, was about to board a Virgin Atlantic flight from Los Angeles International Airport to London, England when he was stopped by United States Customs Service Senior Inspector Roberto Uscanga, who identified himself as a government official. Inspector Uscanga explained to Mayzel that federal law requires persons transporting any amount exceeding $10,000 out of the United States to declare the currency by completing a form. Mayzel responded that he was in the United States to visit family and friends, and was carrying only $5,000. He then handed Inspector Uscanga a bundle of cash which was later determined to amount to $348. Inspector Uscanga noticed a bulge under Mayzel's jacket, which Mayzel removed at his request, revealing a blue shoulder bag. Mayzel handed the bag to Inspector Uscanga, who found inside what was later determined to be $100,000 in cash sealed in ten clear plastic zipper bags. Even before counting the money, Inspector Uscanga was able to ascertain that the sum exceeded the reporting limit. Accordingly, he handed Mayzel Customs Form CF-503, printed in English, and requested that Mayzel complete it in compliance with the reporting requirement. Mayzel refused to do so, informing Inspector Uscanga (in English) that he wished to speak with his attorney, that he was not obligated to complete the form, and that he did not speak English.¹

At this point, Mayzel was detained for questioning. The luggage for which he possessed baggage claim tickets² was removed from the plane and searched. The search revealed a roll of plastic shrink film, a heat gun, and a heat sealer machine: items often used in the packaging of illegal drugs. Mayzel refused to speak with the Customs investigators thereafter, invoking his Miranda rights.

In a bench trial in the District Court for the Central District of California, Mayzel was convicted of knowingly making a false statement, in violation of 18 U.S.C. § 1001. On September 20, 2000, Mayzel was sentenced to 205 days' imprisonment and ordered to pay a special assessment of $100; no fine was ordered because the district court determined that Mayzel did not have the ability to pay. The district court acquitted Mayzel of attempting to transport unreported currency over $10,000 out of the United States, 31 U.S.C. § 5316, reasoning that to violate this statute a person must make a false report in writing.

II. Procedural History

Meanwhile, on March 9, 2000, the United States Customs Service notified Mayzel of the seizure of the $100,348, informing him that if he wished to contest the proposed forfeiture of these funds, he would be required as a claimant to submit a petition in support of his claim and a cost bond. Mayzel did so on April 7, 2000, stating that he was a "lawful possessor" of the currency, but failing to identify its owner. The matter was then referred to the United States Attorney's Office, which filed a forfeiture complaint in the Central District of California on August 22, 2000, and gave notice of the action by sending certified letters to all parties known to have an interest in the defendant currency — i.e., Mayzel and Harounian — and by publishing three notices in the Los Angeles Daily Journal. In response to these notices, the government received only one claim — from Mayzel, via his attorney, Michael Galey, on September 20, 2000. During a mandatory pre-trial meeting on November 15, 2000, Galey told Assistant United States Attorney Janet Hudson that Mayzel had obtained the seized funds from several friends and relatives. He did not provide their names or addresses, however, even after Hudson told him that persons who illegally transport money for drug-related purposes often persuade innocent friends and relatives to perjure themselves by claiming the seized money as their own. A few weeks later, Galey submitted a mandatory preliminary list of witnesses and documentary evidence to be offered at trial, identifying Mayzel as the only potential witness and listing no documents.

After several postponements, each at the request of Mayzel's attorneys, the government deposed Mayzel on March 6, 2001. The day before Mayzel's deposition, his new attorney, Eric Honig, told the government by letter that the owner of the currency was Amiel (a.k.a. "Eric Levy"), and provided a copy of Amiel's business checking account statement. Thereafter, Mayzel asserted in his deposition that Amiel was the owner of the currency. Mayzel testified that his uncle had taken him to meet Amiel, a family friend from a small town in Israel, at a coffee shop in Bonita, California (near San Diego). According to Mayzel, Amiel asked Mayzel to deliver a package — a blue bag containing $100,000 in cash — to Amiel's sister in Israel. Mayzel further testified that he had opened the bag and seen the money, but had not asked any questions about its provenance; he had told Amiel that he did not wish to be responsible if anything happened to the money.

At his deposition, Mayzel was also questioned about his travel plans both before his arrest (from Israel to the United States and within the United States) and his aborted travel plans when he was detained (from the United States to London and thereafter). Much of his testimony was demonstrably at odds with the travel agency records that the government subpoenaed, including the fact that when Mayzel was detained in Los Angeles, supposedly on his way to deliver the funds to Amiel's sister in Israel, he did not possess any tickets or reservations for travel to Israel.

Thereafter, Amiel submitted a declaration stating that he was the owner of the seized funds, was a family friend of the Mayzels, and had obtained the defendant currency as follows:

I built a 99' store in San Diego in 1998. The building was lost in a fire, and I received money from the insurance company. I then purchased a second store from Yosi Parpara, to whom I paid a total of $80,000.00. I later sold the second store to my brother-in-law, who paid me approximately $90,000 in cash. I then asked Mr. Mayzel to bring the cash from the sale, plus $10,000 more, to my sister in Israel.

Because of the declaration's lack of specificity, e.g., names of businesses, names of persons, addresses, dates, etc., the government could verify very few of these assertions. The government next attempted to depose Amiel.

Mayzel moved for summary judgment claiming that: (1) the government lacked probable cause to seize the defendant currency; (2) a forfeiture of any of the currency would be an excessive fine in violation of the Eighth Amendment; and (3) he was an "innocent owner." Honig informed the government that he wished to wait until after...