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CONCEPCION v. UNITED STATES

August 30, 1996

MANUEL CONCEPCION, Petitioner, against UNITED STATES OF AMERICA, Respondent.


The opinion of the court was delivered by: SPATT

 SPATT, District Judge.

 In this action, the petitioner pro se, Manuel Concepcion ("Concepcion" or the "petitioner") moved the Court for an Order directing that the government return $ 926,355.00 more or less, and other property and currency that was seized from him at the time of his 1989 arrest in connection with a criminal proceeding. As a result of the criminal prosecution, Concepcion was convicted of racketeering and money laundering and sentenced to life imprisonment. The currency and other property that was seized was subsequently forfeited to the United States Government by the Drug Enforcement Administration ("DEA" or the "respondent").

 A judicial forfeiture proceeding, United States v. $ 926,355.00 more or less, CV 89-3638 (TCP) was commenced on on or about October 30, 1989. A Decree of Forfeiture and Order of Delivery was signed by then Chief Judge Thomas C. Platt on January 11, 1990. A letter dated June 15, 1995 was submitted to the Clerk of the Court for the United States District Court in the Eastern District of New York by Manuel Concepcion, bearing the docket reference number CV 89-3638, seeking return of the subject property as well as other items. The case was reassigned from Judge Platt to Judge Spatt as related to United States v. Melendez, CR 89-229 (ADS) on September 7, 1995. Upon review by the Eastern District Pro Se Clerk, the June 15, 1995 letter from Manuel Concepcion was deemed to be a petition for the return of seized property and a new civil docket number, CV 95-5337, was assigned to the action.

 I. Background

 The facts stated below are taken from (1) the record of a prior judicial forfeiture action, U.S. v. $ 926,355.00 more or less, CV 89-3638 (TCP), (2) the present petition and the petitioner's reply to the government's opposition, (3) the government's memorandum in opposition of Concepcion's petition to vacate the administrative forfeiture, and (4) the declaration of William J. Snider, Forfeiture Counsel of the Drug Enforcement Administration.

 On March 14, 1989, the petitioner was arrested by federal law enforcement agents in connection with his participation in a racketeering, narcotics, money laundering, and weapons operation. On December 23, 1990, Conception was convicted on 11 counts of racketeering and money laundering. He was sentenced by this Court to life imprisonment and is presently incarcerated at the United States Penitentiary in Allenwood, Pennsylvania. At the time of Petitioner's 1989 arrest, government agents seized numerous items of property from various members of the illegal operation. Among the seized property was approximately $ 926,355.00, which was the subject of the judicial forfeiture proceeding, United States v. $ 926,355.00 more or less, CV 89-3638 (TCP). An automotive repair shop to which Concepcion refers in the present action was also the subject of a judicial forfeiture proceeding, United States v. Premises Located at 82 South 4th St. Brooklyn, NY, CV 89-2953 (TCP), which was closed on January 15, 1991.

 The petitioner now moves for return of the $ 926,355.00, that was forfeited pursuant to the Order dated January 11, 1990 signed by then Chief Judge Platt in CV 89-3638. He also seeks return of an automotive repair shop that was the subject of United States v. Premises Located at 82 South 4th St., Brooklyn, NY, CV 89-2953.

 The petitioner also seeks return of the following items, that were seized and subsequently administratively forfeited in 1989 and 1990: (1) coat/hat; (2) $ 8,080.00; (3) $ 10,716.00; (4) assorted jewelry valued at $ 73,820.00; (5) mink jacket valued at $ 12,250.00; (6) Camaro automobile valued at $ 8,000.00; (7) Harley motorcycle valued at $ 8,465.00; (8) Harley motorcycle valued at $ 5,780.00; (9) Honda motorcycle valued at $ 2,700.00; (10) Chevrolet sedan valued at $ 10,000.00; (11) 1955 Chevrolet Impala valued at $ 10,000.00: (12) 1933 Ford Roadster valued at $ 6,000.00; (13) 1984 Ford Jeep valued at $ 8,000.00; (14) Honda Sabre valued at $ 935.00 (15) jewelry valued at $ 750.00; (16) Honda motorcycle valued at $ 1,935.00; and (17) $ 2,476.00. Concepcion also seeks return of a 1988 Cadillac that he alleges was seized by the government on March 15, 1989. Neither party submitted information to the Court regarding that item. At various times throughout 1989, the seized property listed above was administratively forfeited to the exclusive use and benefit of the United States, pursuant to 19 U.S.C. § 1609.

 II. DISCUSSION

 A brief overview of the statutory forfeiture scheme is instructive in understanding the issues presented in this case. "The Comprehensive Drug Abuse Prevention and Control Act of 1970 (the "Act"), Pub. L. No. 91-513, Title II, § 511, 84 Stat. 1276 (1970) (codified as amended at 21 U.S.C. § 881 (a) (1998 & Supp. III 1991)), provides for the civil forfeiture of property that has been used either to facilitate narcotic transactions or to acquire the proceeds of such criminal activity." Linarez v. United States Dep't of Justice, 2 F.3d 208, 209 (7th Cir. 1993). In order to be subject to forfeiture under the Act, the property must categorically fall into one of the eleven subsections of 21 U.S.C. § 881(a), which provides for the forfeiture of, among other things, controlled substances, the containers, equipment and raw materials used or intended for use in manufacturing any controlled substance, conveyances used or intended to be used for transporting controlled substances and illicitly obtained wealth. See 21 U.S.C. § 881(a).

 Subsection (d) of 21 U.S.C. § 881, provides that the forfeiture of property seized in accordance with Section 881 (a) is to be accomplished through the procedures set forth by the customs laws, which are set forth at 19 U.S.C. §§ 1602-1618. Pursuant to the customs laws as they were at the time of the seizure of the currency and items in this case, seized property valued at $ 100,000 or less were subject to administrative forfeiture to the United States by the seizing agency without judicial involvement. 19 U.S.C. § 1607(a). Where the value of seized property exceeded $ 100,000, judicial forfeiture is required. 19 U.S.C. §§ 1607 (a) (4), 1610; 21 C.F.R. §§ 1316.75, 1316.78. 19 U.S.C. § 1607 was amended in 1990 to increase the dollar amount or value from $ 100,000.00 to $ 500,000.00.

 Judicial forfeiture

 To the extent that this petition seeks a return of property that was forfeited pursuant to prior judicial proceedings, it is not properly before this Court. It is noted that no appeal was taken in those actions to the United States Court of Appeals. Therefore, the petitioner's application with regard to $ 926,355.00, more or less, that was the subject of CV 89-3638 (TCP) and the premises located at 82 South 4th St., Brooklyn, NY, that was the subject of CV 89-2953 (TCP), are not properly before this Court and will not be addressed. In addition, the Court assumes that the reference to $ 1,000,000 currency on the petitioner's exhibits "1" and "3" is a reference to the $ 926,355.00, more or less, that was the subject of CV 89-3638 (TCP).

 Administrative forfeiture

 The value of the other various assets listed by Concepcion permitted the DEA to utilize administrative forfeiture proceedings without judicial intervention as they are each valued at less than $ 100,000. In order to initiate administrative forfeiture proceedings, the DEA "must publish notice of the seizure and of its intent to forfeit the property once a week for at least three successive weeks in a newspaper of general circulation in the judicial district in which the forfeiture proceeding is brought." Linarez, supra, 2 F.3d at 210; 19 U.S.C. § 1607 (a); 21 C.F.R. § 1316.75 (1992). In addition, the administration agency must give personal written notice of the seizure and information on the applicable procedures to contest the forfeiture, to any party who appears to have an interest in the seized property. 19 U.S.C. § 1607 (a).

 The procedures for contesting an administrative forfeiture are set forth in the custom laws. To assert a claim and interest in seized property, a person "may at any time within twenty days from the date of the first publication of the notice of seizure file with the appropriate customs official a claim stating his interest therein" along with a cost bond of $ 5000, or ten percent of the value of the property, whichever is less, but not less than $ 250.00. 19 U.S.C. § 1608. The proper and timely filing of a claim and cost bond has the legal effect of halting the administrative proceeding and requiring the DEA to refer the matter to the United States Attorney for the institution of judicial forfeiture proceedings. 19 U.S.C. §§ 1603 (b), 1608; 21 C.F.R. § 1316.76 (b) (1992). However, the failure of the interested party to file the proper and timely claim and cost bond results in a declaration of forfeiture by the seizing agency, in this case the DEA, and the vesting of title in the United States, free and clear of any liens and encumbrance. 19 U.S.C. § 1609 (b); 21 C.F.R. § 1316.77. If a claimant can show that he is indigent, he may be able to proceed in forma pauperis and may be relieved of the requirement of posting a bond. See, e.g., Application of Williams, 628 F. Supp. 171, 173 (E.D.N.Y. 1986); see also Drug Enforcement Agency Notices of Forfeiture annexed to the Declaration of William J. Snider (advising that "if you are indigent (needy and poor) you may not have to post the bond. To request a waiver of the bond, you must fully disclose your finances in a signed statement called a "Declaration in Support of Request to Proceed In Forma Pauperis " along with a claim of ownership of the property.")

 Alternatively, the claimant may petition the administrative agency, the DEA in this case, for remission and/or mitigation within thirty days after his receipt of the Notice of Seizure. 28 C.F.R. §§ 9.1-9.7. In order "to determine mitigation or remission, the res is deemed technically forfeited and the DEA is given broad discretion to lessen the effects of the forfeiture." United States Drug Enforcement Administration v. One 1987 Jeep, 972 F.2d 472, 479 (2d Cir. 1992). In addition, under specific circumstances, a claimant may file a petition for expedited administrative review when the property has been seized for a violation involving personal use quantities of a controlled substance. 21 C.F.R. §§ 1316.90 - 1316.99.

 However, the "remission of forfeiture is neither a right nor a privilege, but an act of grace." In re $ 67,470.00, 901 F.2d 1540, 1543 (11th Cir. 1990) (citing United States v. One 1961 Cadillac, 337 F.2d 730, 733 (6th Cir. 1964); Arca Airlines v. United States Customs Service, 726 F. Supp. 827, 830 (S.D. Fla. 1989), aff'd, 945 F.2d 413 (11th Cir. 1991); LaChance v. Drug Enforcement Administration, 672 F. Supp. 76, 79 (E.D.N.Y. 1987)). This proposition was stated by the district court in LaChance v. Drug Enforcement Administration, 672 F. Supp. 76 (E.D.N.Y. 1987), which noted that "remission of a forfeiture is a matter of grace and discretion delegated solely to the exclusive authority of the administrative agency." LaChance, supra, 672 F. Supp. at 79. "'The question of our authority to review the Attorney General's denial of the request for remission of the forfeiture is controlled by the long-standing, judge-made rule that the Attorney General has unreviewable discretion over petitions under 19 U.S.C.A. 1618.'" Id. (quoting United States v. One 1970 Buick Riviera Automobile, 463 F.2d 1168, 1170 (5th Cir.), cert. denied, 409 U.S. 980 (1972)). Therefore, "it appears that Congress intended the petition for remission filed with the Administration under 19 U.S.C. § 1618 to be the only available mechanism for leniency to mitigate the harshness of the forfeiture statute." LaChance, supra, 672 F. Supp. at 79 (citing United States v. One 1976 Porsche 911S, 670 F.2d 810, 813 (9th Cir. 1979) and United States v. One Clipper Bow Ketch Nisku, 548 F.2d 8, 12 (1st Cir. 1977). The LaChance court stated,

 
This Court has previously noted that, "The purpose of the remission statute was to grant executive power to relieve against the harshness of forfeitures. The exercise of the power, however, was committed to the discretion of the executive so that he could temper justice with mercy or leniency. Remitting the forfeiture, however, constituted an act of grace. The courts have not been granted jurisdiction to control the action of the executive even where it is alleged . . . that discretion has been abused."

 LaChance, supra, 672 F. Supp. at 79 (quoting Jary Leasing Corp. v. United States, 254 F. Supp. 157, 159 (E.D.N.Y. 1966), which in turn quoted United States v. One 1961 Cadillac, 337 F.2d 730, 733 (6th Cir. 1964)).

 In this regard, the Second Circuit has stated:

 
Under all of the above scenarios, the claimant is afforded the opportunity to test the legality of the seizure in the forfeiture proceeding. See In re Harper, 835 F.2d 1273, 1274 (8th Cir. 1988). Consequently, once the administrative process has begun, the district court loses subject matter jurisdiction to adjudicate the matter in a peripheral setting such as a Rule ...

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