United States v. 8 Luxury Vehicles

• Decision Date: 25 February 2015
• Docket Number: Case No. 2:15–cv–91–SPC–CM.
• Citation: 88 F.Supp.3d 1332
• Parties: UNITED STATES of America, Plaintiff, v. 8 LUXURY VEHICLES, Defendant.
• Court: U.S. District Court — Middle District of Florida

88 F.Supp.3d 1332

UNITED STATES of America, Plaintiff

v.8 LUXURY VEHICLES, Defendant.

Case No. 2:15–cv–91–SPC–CM.

United States District Court, M.D. Florida, Fort Myers Division.

Signed Feb. 25, 2015.

Filed Feb. 26, 2015.

David Lazarus, U.S. Attorney's Office, Ft. Myers, FL, for Plaintiff/Defendant.

ORDER¹

SHERI POLSTER CHAPPELL, District Judge.

This matter comes before the Court on the United States' Motion to Dismiss Claimant JITCO Group Limited's (“JITCO”) Counterclaim, filed on November 24, 2014. (Doc. # 87). JITCO filed a response in opposition on December 12, 2014. (Doc. # 97). This matter is ripe for review.

BACKGROUND

In June 2013, the United States seized 34 luxury vehicles. (Doc. # 63, at 5). These seizures were pursuant to warrants signed by U.S. Magistrate Judge Douglas N. Frazier. (Doc. # 63, at 5). Thereafter, the United States filed a civil complaint against the vehicles in rem. The complaint alleges the vehicles are proceeds of wire fraud, money laundering, and mail fraud, and as a result, seeks forfeiture of the vehicles pursuant to 18 U.S.C. § 981(a)(1)(C). (Doc. # 1, at 1–2). JITCO filed a claim to the following eight vehicles: 2013 BMW X5 VIN: 5UXZV4C56D0E00403; 2013 BMW X5 VIN: 5UXZV4C53D0E05977; 2013 BMW X5 VIN: 5UXZV4C57D0E05982; 2013 BMW X5 VIN: 5UXZV4C55D0E05978; 2013 BMW X5 VIN: 5UXZV4C58D0E06056; 2013 BMW X5 VIN: 5UXZV4C52D0E05856; 2013 BMW X5 VIN: 5UXZV4C50D0E05855; and 2013 BMW X5 VIN: 5UXZV4C59D0E05837. (Doc. # 18). On August 21, 2014, the United States filed its second amended complaint against the 34 vehicles, including the eight vehicles claimed by JITCO. (Doc. # 63). This operative complaint alleges forfeiture of the vehicles is appropriate pursuant to 19 U.S.C. § 1595a(d), 18 U.S.C. §§ 1341, 1343, 1956(h), 1956(a)(2)(A), and 13 U.S.C. § 305(a)(2). (Doc. # 63). On September 25, 2014, JITCO filed its answer, affirmative defenses, and counterclaim. (Doc. # 72). Thereafter, upon motion, the Court severed the claims regarding the eight JITCO vehicles from the underlying action. (Doc. # 75). This instant case represents the severed JITCO claims. (Cf. 2:13–cv–793–FtM–38SPC).

JITCO's counterclaim alleges the United States tortuously interfered with its property rights preventing the sale of eight vehicles and delaying the sale of four additional vehicles. (Doc. # 72, ¶ 38). JITCO alleges pursuant to Georgia state law, the United States' tortious interference with its vehicles constitutes tort deprivation of possession of personalty, common law trespass to chattels, trover and/or conversion. (Doc. # 72, ¶ 25). JITCO further alleges, as a result of the tortious interference and the loss in value of the vehicles, the United States is liable in an amount not less than $304,514 for demurrage fees, costs and interest, pursuant to the Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 2674. (Doc. # 72, ¶¶ 40–41).

The United States argues JITCO's counterclaim should be dismissed for two reasons. First, for failure to state a claim upon which relief can be granted because the rules do not authorize counterclaims in civil forfeiture proceedings. Second, for lack of subject matter jurisdiction because JITCO has not exhausted its administrative remedies as required by the FTCA. For the following reasons, the Court finds the United States' motion is due to be granted.

STANDARD

In deciding a motion to dismiss, the district court must accept all factual allegations in a counterclaim as true and review the allegations in the light most favorable to the claimant.

Christopher v. Harbury, 536 U.S. 403, 406, 122 S.Ct. 2179, 153 L.Ed.2d 413 (2002). Dismissal for failure to state a claim upon which relief may be granted, however, does not require appearance, beyond a doubt. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 561–63, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (abrogating Conley v. Gibson, 355 U.S. 41, 45–46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957) ). While a counterclaim attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a claimant's obligation to provide the “grounds” of “entitlement” to relief requires more than labels, conclusions, and a formulaic recitation of the cause of actions elements. Bell Atlantic Corp., 550 U.S. at 561–63, 127 S.Ct. 1955 ; Fed.R.Civ.P. 12(b)(6).

To satisfy the pleading requirements of Rule 8 of the Federal Rules of Civil Procedure, a counterclaim must simply give the opposing party fair notice of what the claim is and the grounds upon which it rests. Id.; Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002). Unwarranted deductions of fact in a counterclaim are not admitted as true for the purpose of testing the sufficiency of the allegations. Sinaltrainal v. Coca–Cola Co., 578 F.3d 1252, 1268 (11th Cir.2009) (citing Aldana v. Del Monte Fresh Produce, N.A., Inc., 416 F.3d 1242, 1248 (11th Cir.2005) ). The facts as pled must state a claim for relief that is plausible on its face. Sinaltrainal, 578 F.3d at 1268 (citing Iqbal, 556 U.S. at 663–64, 129 S.Ct. 1937 ). Dismissal is warranted pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure if, assuming the truth of the factual allegations of the counterclaim, there is a dispositive legal issue that precludes relief. Simplexgrinnell, L.P. v. Ghiran, 2:07–cv–456–FtM–29DNF, 2007 WL 2480352 *1 (M.D.Fla. Aug. 29, 2007) (citing Neitzke v. Williams, 490 U.S. 319, 326, 109 S.Ct. 1827, 104 L.Ed.2d 338 (1989) ; Brown v. Crawford County, Georgia, 960 F.2d 1002, 1009–10 (11th Cir.1992) ).

DISCUSSION

The United States argues a claimant such as JITCO cannot bring a counterclaim in a civil forfeiture proceeding because a claimant is not a defendant. Instead, the property at issue in rem is considered to be the defendant. Relying on United States v. One Lot of U.S. Currency ($68,000), the United States argues because it did not file a claim against JITCO, there can be no counterclaim by JITCO. 927 F.2d 30, 34–35 (1st Cir.1991) ( “[s]ince no civil claim was filed by the government against [claimant]—indeed, rather than being dragooned into the case as a defendant, he intervened as a claimant—there was no ‘claim’ to ‘counter.’ ”). Also, relying on United States v. $43,725.00 in U.S. Currency, the United States argues a claimant of seized property cannot bring a counterclaim within a civil forfeiture action. No. CIV.A. 4:08–1373–TLW, 2009 WL 347475 at *1 (D.S.C. Feb. 3, 2009) (“claimant of the seized property is not entitled to pursue a counterclaim against the Government or individuals within the limited scope of the in rem civil forfeiture action.”). Relying on United States v. Assorted Computer Equip., the United States argues a civil forfeiture proceeding cannot entertain a claimant's counterclaim because there is no in personam jurisdiction over the United States, since a civil forfeiture case is an in rem proceeding, and counterclaims against the United States are in personam claims. No. 03–2356V, 2004 WL 784493 *2 (W.D.Tenn. Jan. 9, 2004) (stating a civil forfeiture is in rem, not in personam, thus the defendant is the property subject to forfeiture, not the claimant and “[b]ecause the government has not asserted a claim against [claimant], there can be no counterclaim.”). The United States also argues federal rules permitting counterclaims in civil forfeiture proceedings do not extend to counterclaims against the United States.

See Fed.R.Civ.P. 13(d) (“These rules do not expand the right to assert a counterclaim—or to claim a credit—against the United States or a United States officer or agency.”). The United States argues nothing in Rule G, which governs the civil forfeiture procedure, provides for the filing of counterclaims because a counterclaim is an action in rem to forfeit property, whereas a counterclaim against the United States is an in personam action for damages. See RULE G OF THE SUPPLEMENTAL RULES. Lastly, the United States argues the sake of orderly administration of justice dictates against allowing claimants in civil forfeiture proceedings to file counterclaims because there can be multiple claimants in civil forfeiture proceedings.

In JITCO's response, it contends Rule G provides for the filing of counterclaims. That is, Rule G(1) expressly provides if something is not covered by the supplementary rules, then the Federal Rules of Civil Procedure apply. See RULE G(1) OF THE SUPPLEMENTAL RULES. JITCO argues pursuant to Rule 13(a), its counterclaim is allowed as a compulsory counterclaim. Fed.R.Civ.P. 13(a) (“A pleading must state as a counterclaim any claim that—at the time of its service—the pleader has against an opposing party.”). JITCO asserts since it intervened as a claimant and answered the complaint, it is a pleader and the United States is the opposing party. Relying on United States v. One (1) Douglas A–26B Aircraft, JITCO argues the Eleventh Circuit held counterclaims by claimants in civil forfeiture proceedings are not only permitted, but at times compulsory. 662 F.2d 1372, 1377 (11th Cir.1981) (claimant “could have asserted a counterclaim had it been aware of the condition of its aircraft at the time the forfeiture proceedings were litigated.”). Relying on United States v. One Lear Jet Aircraft, JITCO avers a counterclaim brought by a claimant against the government is among the limited exceptions in which the Court will find in personam jurisdiction against the government in certain civil forfeiture proceedings. 836 F.2d 1571, 1577 n. 8 (11th Cir.1988) (“At best, Adam supports a holding that the government would be subject to an in personam counterclaim brought by [claimant] against the government.”) (referring to Adam v. Saenger, 303 U.S. 59, 67–68, 58 S.Ct. 454, 82 L.Ed. 649 (1938) ). Then, relying on United States v. One (1) 1984 Nissan 300 ZX, JITCO argues other district courts, such as the Northern District of Georgia, have held claimants can file counterclaims against the government in civil jurisdiction forfeiture proceedings. 711 F.Supp....