United States v. Contents of J.P. Morgan Chase Bank, N.A.
| Decision Date | 13 December 2011 |
| Docket Number | Civil Action No. 10-551-CG-B |
| Parties | UNITED STATES OF AMERICA Plaintiff, v. THE CONTENTS OF J.P. MORGAN CHASE BANK, N.A., ACCOUNT NO. XXXXXX9951 in the name of BARDAN INTERNATIONAL, INC., INCLUDING AND UP TO $50,000.00, in rem, |
| Court | U.S. District Court — Southern District of Alabama |
At issue in this case is the government's seizure of $50,000.00 held in the name of the claimant, Bardan International, Inc. ("Bardan"), in account number XXXX9951 at J.P. Morgan Chase Bank, N.A., in Miami Florida (the "$50,000"). The government filed a civil forfeiture complaint on October 8, 2010 (Doc. 6), seeking to seize the $50,000 pursuant to two federal statutes. The first statute is the Civil Asset Forfeiture Reform Act of 2000 ("CAFRA"), codified at 18 U.S.C. § 981(a)(1)(A), which provides for the forfeiture of any property involved in a transaction or attempted transaction in violation of the anti-money laundering provisions of 18 U.S.C. §§ 1956 and 1957, and any property traceable to such a transaction. The second statute is 21 U.S.C. § 881(a)(6), which subjects to civil forfeiture all money or other things of value furnished or intended to be furnished by any person in exchange for a controlled substance in violation of the Controlled Substances Act; all proceeds traceable to such an exchange; and all money used or intended to beused to facilitate any violation of the Controlled Substances Act. The government also states in its complaint -- that, to the extent that some funds in the same bank account are not directly traceable to the alleged offenses which form the bases for the forfeiture, they are nevertheless considered the same as the directly traceable funds under 18 U.S.C. § 984, and therefore are subject to forfeiture. (Doc. 6, p. 2).
Bardan filed a motion to dismiss on October 5, 2011, pursuant to Federal Rule of Civil Procedure 12(b)(6) and Rule E(2)(a) of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions ("Supplemental Rules"). (Doc. 14).
The government alleges the following facts in its complaint. In September 2009, agents from the Immigration and Customs Enforcement Agency (ICE) and the Internal Revenue Service (IRS) ("the undercover agents") began investigating the activities of money brokers operating in the country of Colombia, and uncovered what they suspected was a scheme to launder money from the sale of illegal drugs. (Doc. 6, p. 20). Specifically, on September 24, 2009, a co-conspirator contacted an undercover agent and informed him that a Colombian money broker had requested assistance in laundering drug proceeds being stored in the vicinity of Los Angeles, California. Id. at 23. The undercover agent told the conspirator to provide the money broker with the mobile telephone number of another undercover agent in Los Angeles. Id. It was ultimately agreed that a Los Angeles-area associate of the money broker would contact the undercover agent in Los Angeles and arrange todeliver drug proceeds, referred to in coded language as "documents." Id. at 23-24. The next day, September 25, the money broker contacted his co-conspirator and inquired about whether his Los Angeles-area associate had called the Los Angeles-area undercover agent yet. Id. at 23. During the conversation, the money broker stated that his associates usually "cross" their merchandise during the weekend, but said that they were having trouble due to a recent shooting at the border. Id. at 24. In subsequent conversations, the money broker told his co-conspirator that he had a route from Columbia to Honduras, Guatemala, and Mexico, which the co-conspirator understood to mean a route for smuggling cocaine to the United States. Id.
After several telephone calls back and forth between the undercover agent in Los Angeles and several of the money broker's associates, one of the associates met the undercover agent on October 9, 2009, in a parking lot in City of Industry, California, and delivered a large amount of U.S. currency to him. Id. at 25. When the currency was counted later, it amounted to $299,790.00. Id. The money was subsequently deposited into an ICE-controlled undercover bank account which was set up in Mobile, Alabama, in order to receive the suspected drug proceeds and to wire transfer them according to the instructions they received from the Colombian money broker and his co-conspirators. Id.
Between October 14 and October 20, 2009, a total of $206,950 of this money was wired from the ICE-controlled undercover bank account in Mobile to various domestic and foreign bank and investment accounts as directed by the moneybroker and his co-conspirators. Id. More specifically, on October 14, the money broker sent a fax to a co-conspirator containing wiring instructions that directed that $50,000.00 be sent to Washington Mutual Bank (now owned by J.P. Morgan Chase Bank, N.A.) located in Miami, Florida, to the benefit of Bardan International, Inc., 520 Brickell Key Drive, Miami, Florida 33131; account number XXXX9951, the contents of which are the subject of this action. Id. at 25-26. The money was subsequently wired from the undercover account as directed on the afternoon of October 14, 2009. Id. at 26.
As a post-script, on March 4, 2010 (approximately five months later), law enforcement agents began surveillance of a house in Colton, California, which was linked to the person who handed over the $299,790 in cash to the undercover agent in the parking lot in City of Industry. Id. After obtaining a search warrant, the law enforcement agents searched the house and found approximately ten kilograms of cocaine and an additional $159,820 in U.S. currency. Id. at 27.
Under Federal Rule of Civil Procedure 12(b)(6), a court may grant a motion to dismiss when a complaint fails to state a claim upon which relief can be granted. To withstand a motion to dismiss, a complaint must " 'give the defendant fair notice of what the ... claim is and the grounds upon which it rests.' " Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). The court construes the complaint in the plaintiff's favor, and accepts the facts it alleges as true. M.T.V. v. DeKalb County Sch. Dist., 446 F.3d 1153, 1156(11th Cir. 2006). However, "a formulaic recitation of the elements of a cause of action will not do," Twombly, 550 U.S. at 555, as "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions." Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). Thus, a wholly conclusory statement of a claim cannot, without more, survive a motion to dismiss. See Weissman v. Nat'l Ass'n of Sec. Dealers, Inc., 500 F.3d 1293, 1303 (11th Cir. 2007) (citing Twombly, 550 U.S. at 561-62).
In this matter, the traditional pleading rules are modified by the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions ("Supplemental Rules"). See 18 U.S.C. § 983(a)(3)(A). The parties cite two Supplemental Rules in particular -- Supplemental Rule E ("Rule E") and Supplemental Rule G ("Rule G") -- each arguing that the Supplemental Rule it cites is the relevant pleading standard applicable to the government's complaint. See Docs. 14, 24, and 25.
Bardan points to Rule E, which applies to "actions in rem," as containing the correct pleading standard. (Doc. 14, p. 1). Under Rule E, complaints must "state the circumstances from which the claim arises with such particularity that the ... claimant will be able, without moving for a more definite statement, to commence an investigation of the facts and to frame a responsive pleading." Supp. Rule E(2)(a).
The government cites Rule G, which specifically governs complaints of "forfeiture action[s] in rem arising from a federal statute." Supp. Rule G(1). RuleG does not require forfeiture complaints to be plead with particularity; instead, they need only contain "sufficiently detailed facts to support a reasonable belief that the government will be able to meet its burden of proof at trial." Supp. Rule G(2)(f). In addition, Rule G(8)(b)(ii) provides that "in an action governed by [CAFRA] ... the sufficiency of the complaint is governed by Rule G(2)."
Some district courts within the Eleventh Circuit have held that "[c]ourts are to evaluate the sufficiency of a complaint under standards established by [Rule G]." United States v. 4323 Bellwood Circle, Atlanta, Ga. 30349, 680 F.Supp.2d 1370, 1372 (N.D.Ga. 2010). See also United States v. $22,010.00 in U.S. Funds, No. 5:09-cv-198, 2010 WL 1050410 at *2 (); United States v. $25,511 .65 in U.S. Funds, No. 7:09-cv-130, 2010 WL 3732935 at *3 (M.D.Ga. Sept.17, 2010) (); United States v. Real Property, No. 3:08-cv-89, 2008 WL 3200271 at *1 (M.D.Fla. Aug.5, 2008).
Other courts within the Eleventh Circuit look to both Rule E and Rule G in determining the sufficiency of forfeiture complaints. See United States v. Assets Described in Attachment A to the Verified Complaint for Forfeiture In Rem, No. 6:09-cv-1852, 2010 WL 1893327 at *5 ; United States v. $220,562.00 in U.S. Funds, No. 5:08-cv-364, 2009 WL 789653 at *1 (M.D.Ga. Mar. 23, 2009); United States v. $1,370,851.62 in U.S. Currency, No. 09-cv-21277, 2009WL 3400510 at * l-2 (S.D.Fla. Oct. 21, 2009); United States v. $15,740.00 in U.S. Funds, No. 5:07-cv-375, 2008 WL 2227511 at *1 .
The practical difference between these two lines of cases, however, is minimal. Although Rule E requires complaints to be pleaded with sufficient particularity to permit a factual investigation and responsive pleading, courts that apply...
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