US v. $633,021.67 IN US CURRENCY

• Decision Date: 14 December 1993
• Docket Number: No. 1:93-cv-1054-RHH.,1:93-cv-1054-RHH.
• Citation: 842 F. Supp. 528
• Court: U.S. District Court — Northern District of Georgia
• Parties: UNITED STATES of America, Plaintiff, v. $633,021.67 IN UNITED STATES CURRENCY; Assorted Computers; 10,131 Cable Converter Boxes, Defendants. In re M.D. ELECTRONICS, Claimant. In re G & A DISTRIBUTING, Claimant. In re Gene ABBOUD, Claimant. In re M & D ELECTRONICS, Claimant. In re Joe ABBOUD, Claimant.

842 F. Supp. 528

UNITED STATES of America, Plaintiff, v. $633,021.67 IN UNITED STATES CURRENCY; Assorted Computers; 10,131 Cable Converter Boxes, Defendants In re M.D. ELECTRONICS, Claimant In re G & A DISTRIBUTING, Claimant In re Gene ABBOUD, Claimant In re M & D ELECTRONICS, Claimant. In re Joe ABBOUD, Claimant.

No. 1:93-cv-1054-RHH.

United States District Court, N.D. Georgia, Atlanta Division.

December 14, 1993.

Dahil Dueno Goss, Office of U.S. Atty., Atlanta, GA, for plaintiff.

Gregory R. Crochet, Kutak Rock, Atlanta, GA, James Martin Mavis, F. Joseph Warin, Kutak Rock, Omaha, NE, for defendants.

ORDER

ROBERT H. HALL, District Judge.

This case is before the Court on Claimant Gene Abboud's Motion for Change of Venue 17 and Motion to Dismiss 18; Claimant G & A Distributing's Motion to Dismiss 20 and Motion for Change of Venue 21; Claimant M & D Electronics' Motion to Dismiss or, in the alternative, to Transfer 23; and Plaintiff's Motion to Strike 27. The Court DENIES Claimant Gene Abboud's Motion for Change of Venue, DENIES Claimant Gene Abboud's Motion to Dismiss, DENIES Claimant G & A Distributing's Motion to Dismiss, DENIES Claimant G & A Distributing's Motion for Change of Venue, DENIES Claimant M & D Electronics' Motion to Dismiss, and DENIES Claimant M & D Electronics' alternative Motion to Transfer. The Court also DENIES Plaintiffs Motion to Strike.

BACKGROUND

This case is a forfeiture action brought by the United States (Plaintiff) against certain monies, computer equipment, and cable television converter boxes (Defendants, hereinafter referred to as "the property" or "defendant property"). Plaintiff claims that the property is associated with a "cable pirating" scheme in which Claimants¹ purchased cable converter boxes, modified them to receive cable television programming by bypassing the local cable companies which supply the programming for a charge, and then sold the modified boxes to consumers. Complaint, ¶¶ 3-6. Plaintiff claims that the money is subject to forfeiture because it constitutes the proceeds of specified unlawful activities, namely violations of 18 U.S.C. §§ 1341 (mail fraud) and 1343 (wire fraud). Id. at ¶ 19. Plaintiff also claims that the computer equipment and cable converter boxes are subject to forfeiture because they are properties used, sent, carried, manufactured, assembled, sold, or advertised in violation of 18 U.S.C. § 2512 (a statute concerning communications pirating) and because they are properties involved in violations of 18 U.S.C. § 1956 (money laundering). Id. at ¶ 21.

Plaintiff claims that Claimants purchased unmodified cable converter boxes from, and sold modified cable converter boxes to, individuals and/or companies located in the Northern District of Georgia. Id. at ¶¶ 3, 7, 13, 14. See also Plaintiff's Response to Motions to Dismiss 34, pp. 1-4. Plaintiff seized the defendant money from a bank in the Southern District of Iowa and seized the defendant computer equipment and cable converter boxes from business establishments located in the District of Nebraska. Complaint at ¶¶ 18, 20. Plaintiff then moved the property into the Northern District of Georgia and now pursues this forfeiture action in this district.

DISCUSSION

I. Plaintiff's Motion to Strike.

Plaintiff moves the Court to strike the motions filed by Claimants Gene Abboud and G & A Distributing, alleging (1) that the motions were filed late, and (2) that the motions were filed by a non-resident attorney in violation of Local Rule 110-2. The Court notes that on August 27, 1993, Gene Abboud and G & A Distributing's attorney, James Martin Davis, was admitted pro hac vice. 30. The Court finds that Claimants' tardiness did not prejudice Plaintiff, and that Mr. Davis has cured his violation of Local Rule 110-2. The Court, therefore, denies Plaintiff's motion.

II. Jurisdiction.

Plaintiff alleges, in its Complaint, that "this Court has jurisdiction over the claim by virtue of 18 U.S.C. §§ 981(a)(1) and 1341, and 28 U.S.C. § 1395(c)." Complaint, ¶ 1. Plaintiff's Complaint also suggests that jurisdiction may exist pursuant to 18 U.S.C. § 2513. Id. at ¶ 21, In their motions, Claimants assert that this Court lacks jurisdiction over the defendant property because it was not seized within the Northern District of Georgia. Plaintiff responds by arguing that this Court has jurisdiction pursuant to 28 U.S.C. §§ 1345 and 1355(a). Plaintiff's Response 35, p. 5.

18 U.S.C. § 981(a)(1) and 18 U.S.C. § 2513 give the government the authority to subject the defendant property to forfeiture. 18 U.S.C. § 1341 sets forth the substantive law on mail fraud. These statutes do not give this Court jurisdiction over the defendant property.

28 U.S.C. § 1345 provides: "Except as otherwise provided by Act of Congress, the district courts shall have original jurisdiction of all civil actions, suits or proceedings commenced by the United States, or by any agency or officer thereof expressly authorized to sue by Act of Congress." 28 U.S.C. § 1355(a) provides in pertinent part: "The district courts shall have original jurisdiction, exclusive of the court of the States, of any action or proceeding for the recovery or enforcement of any fine, penalty, or forfeiture, pecuniary or otherwise, incurred under any Act of Congress...." These provisions give federal district courts jurisdiction over the subject matter of forfeiture actions, but they do not speak to the jurisdiction of a particular district court over the actual property which is the subject of a forfeiture action. United States v. United States Currency in the Amount of $23,481.00, 740 F.Supp. 950, 952, 953 (E.D.N.Y.1990). See generally 13B Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure, § 3579 (1984 & Supp.1993); 137 Cong.Rec. S16642 (November 13, 1991) (analysis of the portion of the Annunzio-Wylie Act which was later codified at 28 U.S.C. § 1355. The same analysis was also submitted into the record at 137 Cong.Rec. S12238 (August 2, 1991)).

28 U.S.C. § 1395 is generally regarded as a venue-conferring statute. See 137 Cong. Rec. S16642; United States v. Four Parcels of Real Property on Lake Forrest Circle, 870 F.2d 586, 589 n. 4 (11th Cir.1989). Section 1395 provides in pertinent part:

(b) A civil proceeding for the forfeiture of property may be prosecuted in any district where such property is found.

(c) A civil proceeding for the forfeiture of property seized outside any judicial district may be prosecuted in any district into which the property is brought.

Although this is a venue statute, there is some argument that by establishing venue in a certain judicial district, section 1395 also confers jurisdiction within that judicial district. See 137 Cong.Rec. S16643. The Court need not address that question, however, as Section 1395 does not reach the defendant property in this case.

Plaintiff has already admitted that subsection (c) applies only to property seized "outside the territorial limits of the United States." United States v. One Caribou Aircraft Registration No. N-1017-H, 557 F.Supp. 379, 381 (D.P.R.1983). See also United States v. One 1974 Cessna Model 310R Aircraft, 432 F.Supp. 364, 368 (D.S.C. 1977) (same), disapproved of, on other grounds, by United States v. One Lear Jet Aircraft, 836 F.2d 1571, 1575 n. 4 (11th Cir. 1988). Subsection (b) confers venue only in the judicial district in which seized property "is found." A court may not treat a piece of property as being "found" within a certain judicial district where it is physically within the district only because the government moved it there subsequent to seizing it elsewhere. Otherwise, the government could establish jurisdiction anywhere in the United States merely by transporting the seized property to a judicial district of its choosing. United States Currency in the Amount of $23,481.00, 740 F.Supp. at 952, 953-54; United States v. $358,613.00, United States Currency, 703 F.Supp. 452, 454-55 (W.D.N.C. 1988); One 1974 Cessna Model 310R Aircraft, 432 F.Supp. at 367-69.

Although Plaintiff does not mention 18 U.S.C. § 981(h), this subsection allows the government to bring a forfeiture proceeding "in the judicial district in which the defendant owning such property is found or in the judicial district in which the criminal prosecution is brought." There is no evidence or allegation, however, that Claimants (the only possible "defendants owning such property") can be found in the Northern District of Georgia. Plaintiff also does not allege that criminal proceedings are pending against any of the alleged owners of the defendant property. Thus, 18 U.S.C. § 981(h) can not confer jurisdiction in this case.

This leaves only 28 U.S.C. § 1355(b)(1) as a possible jurisdiction-conferring statute in this case. 28 U.S.C. § 1355 provides in pertinent part:

(a) The district courts shall have original jurisdiction, exclusive of the courts of the States, of any action or proceeding for the recovery or enforcement of any fine, penalty, or forfeiture, pecuniary or otherwise, incurred under any Act of Congress.... (b)(1) A forfeiture action or proceeding may be brought in —

(A) the district court for the district in which any of the acts or omissions giving rise to the forfeiture occurred, or

(B) any other district where venue for the forfeiture action or proceeding is specifically provided for in section 1395 of this title or any other statute.

. . . . .

(d) Any court with jurisdiction over a forfeiture action pursuant to subsection (b) may issue and cause to be served in any other district such process as may be required to bring before the court the property that is the subject of the forfeiture action.

Subsection (b)(1) was added to Section 1355 by enactment of the Money Laundering Improvements Act of 1991, Pub.L. 102-550, 106 Stat. 4062, 102nd Cong., 2d Sess. (Oct. 28, 1992) (hereinafter referred to as the "Annunzio-Wylie Act," named after the Act's...