UNITED STATES of America, Plaintiff-Appellee, v. Gary H. MAROLF, in re application for return of seized property 1981 Mango Motor sailboat named “Asmara“, Defendant-Appellant.
No. 97-56275.
United States Court of Appeals, Ninth Circuit.
Argued and Submitted March 1, 1999. Decided April 12, 1999.
173 F.3d 1213 | 99 Cal. Daily Op. Serv. 2656 | 1999 Daily Journal D.A.R. 3482
Before: PREGERSON, and RYMER, Circuit Judges, and PRO, District Judge.
Carla A. Ford, Assistant United States Attorney, Los Angeles, California, for the plaintiff-appellee.
Appeal from the United States District Court for the Central District of California Alice Marie Stotler, District Judge, Presiding. D.C. No. CV-96-1185-AHS CR-91-66-AHS.
Opinion by Judge PRO; Concurrence by Judge RYMER.
PRO, United States District Judge:
Gary Marolf appeals the denial of his motion under
BACKGROUND
On July 12, 1991, while investigating Marolf and others involved in a marijuana smuggling enterprise, the Drug Enforcement Administration (“DEA“) seized the vessel Asmara which had been used to smuggle marijuana from Thailand into the United States. The DEA initiated administrative forfeiture proceedings against the vessel and published the required notice of seizure and intent to forfeit for three successive weeks in accord with
On September 16, 1991, Marolf was arrested for conspiracy to import marijuana into the United States in violation of
On March 23, 1992, Marolf entered a guilty plea to one count of conspiracy to import approximately 900 kilograms of marijuana into the United States in violation of
On May 11, 1995, Marolf filed a motion pursuant to
The statute of limitations for the government to file judicial forfeiture proceedings against the Asmara expired on July 11, 1996. See
The district court determined that the proper remedy for the defective notice of forfeiture by the DEA was to void the forfeiture of the Asmara and to consider Marolf‘s Rule 41(e) motion on the merits, even though the five-year statute of limitations had expired. Marolf, 973 F.Supp. at 1151. On the merits, the district court found that Marolf could not refute the government‘s showing of probable cause to seize the Asmara nor could he prove by a preponderance of the evidence that the vessel was not used for an illegal purpose. Id. at 1152.
We review de novo the district court‘s denial of a Rule 41(e) motion, see 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)), and its underlying factual findings for clear error, see Ahern v. Central Pac. Freight Lines, 846 F.2d 47, 48 (9th Cir.1988).
DISCUSSION
I. Inadequate Notice of Forfeiture and the Five-Year Limitations Period
Rule 41(e) motions are treated as proceedings in equity when there are no criminal proceedings pending against the movant. See United States v. Martinson, 809 F.2d 1364, 1366 (9th Cir.1987).
Where the government provides constitutionally deficient notice of an administrative forfeiture, other courts of appeals have generally voided such actions and remanded for further proceedings. See, e.g., Muhammed v. DEA, Asset Forfeiture Unit, 92 F.3d 648, 654 (8th Cir.1996); Barrera-Montenegro v. United States, 74 F.3d 657, 661 (5th Cir.1996); United States v. Giraldo, 45 F.3d 509, 512 (1st Cir.1995). We have already held that a district court retains equitable jurisdiction to adjudicate claims of inadequate notice of administrative forfeitures. See United States v. Clagett, 3 F.3d 1355, 1356 (9th Cir.1993); see also Marshall Leasing, Inc. v. United States, 893 F.2d 1096, 1102-03 (9th Cir.1990) (district court had jurisdiction over due process attack on administrative forfeiture under
Despite the expiration of the limitations period, however, the district court proceeded to adjudicate Marolf‘s claim on the merits, relying primarily upon the Second Circuit Court of Appeals, decision in Boero v. DEA, 111 F.3d 301 (2d Cir.1997). In Boero, the trial court found that the DEA had failed to comply with the requisite notice requirement for an administrative forfeiture. Though the trial court had the power to correct the deficiency, it instead allowed the defendant-claimant to pursue an administrative remedy over five years from the date of initial seizure, notwithstanding the expiration of the limitations period. Id. at 305. On appeal, the Second Circuit Court of Appeals noted that “when the government is responsible for a known claimant‘s inability to present a claim, through the government‘s disregard of its statutory obligation to give notice (or otherwise), a hearing on the merits is available in the district court.” Id. at 306. Accordingly, the Court in Boero vacated the trial court‘s judgment to the extent that it called for new administrative proceedings and directed the trial court to resolve the dispute on the merits. Id. at 307.
The Boero approach was specifically rejected by the Tenth Circuit in Clymore v. United States, 164 F.3d 569, 574 (10th Cir.1999), a decision rendered after the district court‘s ruling in this case. In a situation virtually identical to the one before this court, the Tenth Circuit Court of Appeals concluded that “[w]here obvious statute of limitations problems exist, we think the offending [i.e., inadequately noticed] forfeiture should be vacated and the statute of limitations allowed to operate, subject, of course, to any available government arguments against it.” Id. at 574.
We agree with the Clymore decision to the extent it calls for the voiding of an inadequately noticed administrative forfeiture and the application of the five-year limitations period. We have previously stated that we are “particularly wary of civil forfeiture statutes, for they impose ‘quasi-criminal’ penalties without affording property owners all of the procedural protections afforded criminal defendants.” United States v. $191,910.00 in U.S. Currency, 16 F.3d 1051, 1068 (9th Cir.1994) (citation omitted). Generally, forfeitures “should be enforced only when within both letter and spirit of the law.” U.S. v. One 1936 Model Ford V-8 De Luxe Coach, Motor No. XX-XXXXXXX, 307 U.S. 219, 226, 59 S.Ct. 861, 83 L.Ed. 1249 (1939), cited with approval in United States v. One 1985 Mercedes--Benz, 300 SD, VIN WDBC2OC6FA177831, 14 F.3d 465, 468 (9th Cir.1994).
In $191,910.00 in U.S. Currency, 16 F.3d at 1068-69, we strictly construed the currency forfeiture provisions of
Here, the government admits that it erred by failing to provide Marolf with notice of the seizure and intent to forfeit the Asmara after it became aware that Marolf had an interest in the vessel. On December 10, 1991, the DEA Office of Chief Counsel, Asset Forfeiture Section, was advised of Marolf‘s ownership of the Asmara. “For reasons that remain unexplained [to the district court], the defendant was not subsequently notified.” Marolf, 973 F.Supp. at 1147. The forfeiture statutes “impose no duty on a defendant to prevent the government from losing its rights through carelessness.” United States v. Giovanelli, 998 F.2d 116, 119 (2d Cir.1993). Rather, it is the government that must be held to a higher standard.
Our conclusion is supported by authorities promoting the consistent application of the statute of limitations. Historically, statutes of limitation have “represent[ed] a pervasive legislative judgment that it is unjust to fail to put the adversary on notice to defend within a specified period of time and that ‘the right to be free of stale claims in time comes to prevail over the right to prosecute them.’ ” United States v. Kubrick, 444 U.S. 111, 117, 100 S.Ct. 352, 62 L.Ed.2d 259 (1979) (quoting in part Order of R.R. Telegraphers v. Railway Express Agency, 321 U.S. 342, 349, 64 S.Ct. 582, 88 L.Ed. 788 (1944)). The legislative bar is intended to prevent the assertion of old claims in opposition to which “evidence has been lost, memories have faded, and witnesses have disappeared.” Id. at 348-49, cited with approval in United States ex rel. Hyatt v. Northrop Corp., 91 F.3d 1211, 1217 (9th Cir.1996); see also Bancorp Leasing & Fin. Corp. v. Agusta Aviation Corp., 813 F.2d 272, 276 (9th Cir.1987).
Ironically, given Marolf‘s guilty plea to the drug conspiracy charge, this does not seem to be a case in which timely access to evidence or witnesses would have prevented the forfeiture. Nevertheless, limitation periods ” ‘for gaining access to the federal courts are not to be disregarded by courts out of a vague sympathy for particular litigants.’ ” Union Pacific R.R. Co. v. Beckham, 138 F.3d 325, 330 (8th Cir.1998) (quoting Baldwin County Welcome Ctr. v. Brown, 466 U.S. 147, 152, 104 S.Ct. 1723, 80 L.Ed.2d 196 (1984)). Thus, absent the application of laches or equitable tolling principles, “courts may not ignore the statute of limitations simply because they opine that a given action is not stale or that a particular defendant‘s repose has already been broken.” Justice v. United States, 6 F.3d 1474, 1482-83 (11th Cir.1993).
II. Laches
In rare instances the bar of the forfeiture statute of limitations may be subject to the equitable defense of laches.3 The government revives its argument that Marolf‘s Rule 41(e) motion should be denied on this basis, regardless of any notice defect. See United States v. $25,000 U.S. Currency, 853 F.2d 1501, 1504 n. 1 (9th Cir.1988) (appellate court may affirm a district court‘s correct decision even if reached for the wrong reasons). To assert the affirmative defense of laches, the party seeking immunity from suit must demonstrate that: (A) the opposing party inexcusably delayed the pursuit of its claim and (B) prejudice resulted from this delay. See Apache Survival Coalition v. United States, 21 F.3d 895, 905 (9th Cir.1994); Wauchope v. United States Dep‘t of State, 985 F.2d 1407, 1411 (9th Cir.1993). After reviewing the district court‘s denial of laches for abuse of discretion, see Clamp Mfg. Co. v. Enco Mfg. Co., 870 F.2d 512, 514 (9th Cir.1989), we find that the government has failed to meet its burden.
Nevertheless, there is certainly evidence to indicate that Marolf may have unjustifiably postponed his filing. While it is unknown precisely when Marolf first learned of the seizure of the Asmara, it is clear that he had received actual knowledge by May 11, 1995, when he filed his § 2255 motion. There, Marolf stated that he “was advised by counsel not to challenge any possible forfeiture proceedings because the discovery process in civil forfeiture actions would violate his Fifth Amendment right against self incrimination and could be used in the criminal proceeding.” Moreover, the district court noted that Marolf waited until fifteen months after denial of his § 2255 motion before filing the Rule 41(e) motion on December 2, 1996, viz., after the expiration of the five-year statute against the government on July 12, 1996. See
The government also claims that it was prejudiced by Marolf‘s delay in bringing his Rule 41(e) motion, insofar as it was precluded from initiating a judicial proceeding within the limitations period. The district court denied this claim, however, on the grounds that it was the “government‘s own carelessness,” not the timing of Marolf‘s Rule 41(e) motion, that precluded the initiation of judicial foreclosure proceedings. The DEA knew as early as mid-July 1991 that Marolf may have had an interest in the vessel and that he had not been notified of the forfeiture action through standard procedures. Nevertheless, the government inexplicably failed to remedy the improper administrative notice or initiate properly-noticed judicial proceedings.4 Thus, we hold that the district court did not abuse its discretion in concluding that any prejudice to the government was attributable to its own inexcusable delay. Accordingly, we affirm the district court‘s denial of the government‘s claim of laches.
III. Nominal Damages
In the alternative, the government argues that we should award Marolf only nominal damages in connection with the DEA‘s failure to provide adequate notice, while allowing the forfeiture to stand. In support of its position, the government asserts that procedural due process does not protect against deprivations per se, but only against those deprivations that are mistaken or unjustified as a matter of law. See, e.g. Carey v. Piphus, 435 U.S. 247, 259, 98 S.Ct. 1042, 55 L.Ed.2d 252 (1978) (“Procedural due process rules are meant to protect persons not from the deprivation, but from the mistaken or unjustified deprivation of life, liberty, or property.“); Raditch v. United States, 929 F.2d 478, 481 n. 5 (9th Cir.1991) (due process violation that is justified merits award of only nominal damages); Scofield v. City of Hillsborough, 862 F.2d 759, 765-66 (9th Cir.1988) (due process violation may require only nominal damages award of $1.00). Nominal damages are available where the violation of a legal or constitutional right produces no “actual damages.” See Wilks v. Reyes, 5 F.3d 412, 416 (9th Cir.1993); see also Draper v. Coombs, 792 F.2d 915, 921-22 (9th Cir.1986). We find the government‘s argument to be unpersuasive.
The authorities cited by the government deal solely with the ambit of constitutional procedural due process. In contrast, statutes of limitation are the product of legislative public policy, divorced from the concepts of natural or fundamental rights. See Chase Sec. Corp. v. Donaldson, 325 U.S. 304, 314, 65 S.Ct. 1137, 89 L.Ed. 1628 (1945). Thus, barring a contrary legislative pronouncement or laches, courts should impose the delineated limitations barrier to suit. Marolf‘s continued lack of possession of the Asmara constitutes an “actual injury” for which he deserves more than nominal damages.5
We affirm the district court‘s decision insofar as it voided the administrative forfeiture due to inadequate notice. However, because the government failed to comply with the five-year limitation of
AFFIRMED IN PART, REVERSED IN PART AND REMANDED.
RYMER, Circuit Judge, concurring:
I agree that the judgment must be reversed, but write separately to explain why the five-year statute of limitations that applies to government forfeiture proceedings is relevant to Marolf‘s action.
Marolf was entitled to notice so that he could timely file a claim and have a hearing on probable cause and ownership. Because he did not get proper notice, he was deprived of that opportunity. For this reason, the forfeiture is void and cannot stand. See Clymore v. United States, 164 F.3d 569, 573 (10th Cir.1999) (voiding defectively-noticed forfeiture); Muhammed v. DEA, Asset Forfeiture Unit, 92 F.3d 648, 654 (8th Cir.1996) (same); Barrera-Montenegro v. United States, 74 F.3d 657, 661 (5th Cir.1996) (same). Nevertheless, the government could go back to square one by providing proper notice and recommencing forfeiture proceedings — so long as it does so within the statutory period. Under these circumstances, a court could well do equity by going directly to the merits and holding the hearing to which the claimant would have been entitled had notice been properly given to begin with. The problem in this case is that the period of limitations has passed. As Marolf argues, this means that the government cannot go back to square one because it is barred from instituting any forfeiture proceeding by the five-year statute of limitations. See
The government points out that Rule 41(e) motions are treated as proceedings in equity when there is no criminal action pending, see United States v. Martinson, 809 F.2d 1364, 1366-67 (9th Cir.1987), and argues that affording Marolf a judicial hearing on the merits of forfeiture is the appropriate remedy in view of the fact that this is the remedy to which Marolf would have been entitled had notice been proper. It urges us to follow the Second Circuit‘s approach in Boero v. DEA, 111 F.3d 301 (2d Cir.1997), where the court affirmed the district court‘s holding that the administrative forfeiture of the claimant‘s property was improper because of inadequate notice, but reversed the order dismissing Boero‘s complaint and directing the DEA to recommence administrative forfeiture proceedings. The court held that the district court‘s relegation of Boero to an administrative remedy was improper because “when the government is responsible for a known claimant‘s inability to present a claim, through the government‘s disregard of its statutory obligation to give notice (or otherwise), a hearing on the merits is available in the district court.” Id. at 306. In doing so, the court instructed the district court to consider Boero‘s claim on the merits in spite of the fact that more than five years had elapsed since the alleged offense was discovery. From this, the government infers that a hearing on the merits is appropriate regardless of whether the statute of limitations has run in this case. I do not see it this way. Nothing in Boero suggests that the court actually considered and ruled on the import of the statute of limitations. Unlike here, Boero did not seek return of his property because the forfeiture was void and the statute of limitations had run, but rather requested a judicial hearing on the merits of the forfeiture. See id., at 307 (“Boero‘s remedy is to restore his right to seek a hearing in district court, a right he evidently wishes to exercise.“). Likewise, in United States v. Giovanelli, 998 F.2d 116 (2d Cir.1993), on which the government also relies, the court did not discuss the statute of limitations issue, nor did it have occasion to as it awarded the claimant return of his seized property without reaching that issue. Thus, Boero and Giovanelli do not necessarily conflict with Clymore, which is squarely on point. I therefore agree that we should join the Tenth Circuit in holding that a forfeiture without proper notice is void and when the statute of limitations has run, the forfeiture must be vacated unless other equitable considerations come into play. See Clymore, 164 F.3d at 574. They do not in this case, as the district court did not abuse its discretion in concluding that the government‘s only argument, based on laches, did not bar Marolf from pursuing his Rule 41(e) motion.