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United States v. $88

United States District Court, Fourth Circuit

December 12, 2013

UNITED STATES OF AMERICA, Plaintiff,
v.
$88, 549.00 IN UNITED STATES CURRENCY, Defendant.

REPORT AND RECOMMENDATION

TIMOTHY J. SULLIVAN, Magistrate Judge.

This Report and Recommendation addresses the Motion for Default Judgment and Order of Forfeiture ("Motion, " ECF No. 9) filed by Plaintiff United States of America ("the government") arising from this forfeiture in rem action against $88, 549.00 in United States Currency ("the defendant currency"). No response has been filed and the time for doing so has passed. See Loc. R. 105.2. On November 20, 2013, in accordance with 28 U.S.C. § 636 and Local Rule 301, Judge Hollander referred this case to me to review the government's Motion and to make recommendations concerning damages. ECF No. 10. Having reviewed the filings, I find that a hearing is not necessary. See Loc. R. 105.6. For the reasons stated herein, I recommend that, following the time to object to this Report and Recommendation, the government's Motion for Default Judgment and Order of Forfeiture be GRANTED.

I. FACTUAL BACKGROUND

On February 1, 2013, during the execution of a search warrant at 4150 Brown Bark Circle, Randallstown, Maryland ("the residence"), [1] law enforcement found and seized $81, 093.00 in United States Currency. Antoine J. Wiggins ("Mr. Wiggins") and Dara April White ("Ms. White"), both adults, were located inside the residence at the time of the search. Several weeks later, during the arrest of Mr. Wiggins at the same address, $7, 456.00 was found and seized from his person. The total amount seized during the execution of the warrants was $88, 549.00, which constitutes the defendant currency that the government seeks to forfeit in this case.

II. DISCUSSION

On July 5, 2013, the government filed its Verified Complaint for Forfeiture. ECF No. 1. On September 11, 2013, the government mailed copies of the Complaint and the related Notice of Complaint for Forfeiture via certified mail, return receipt requested, to Marc L. Zayon, Esquire, [2] who was then the attorney for Mr. Wiggins and Ms. White. ECF No. 7 at 3 ¶ 4. An agent in Mr. Zayon's office signed the return receipt for the Verified Complaint and notices on September 12, 2013. ECF No. 7-2 at 3 & 6. The Notice of Complaint for Forfeiture mailed with the Verified Complaint for Forfeiture contained instructions and procedures for filing a verified claim and stated that the verified claim must be filed with thirty-five days of receipt of the Notice of Complaint for Forfeiture. The Notice also stated that an answer to the Complaint or a motion under Rule 12 of the Federal Rules of Civil Procedure ( see Supplemental Rule G(5)(b)) had to be filed within 21 days with the Clerk of this Court and a copy provided to the United States Attorney's Office. ECF No. 7-2 at 5. In addition, the government published notice of this case on an official government website, http://www.forfeiture.gov, beginning on September 12, 2013. ECF No. 7-3, p. 1-3. This notice stated:

Any person claiming a legal interest in the Defendant Property must file a verified Claim with the court within 60 days from the first day of publication (September 12, 2013) of this Notice on this official government internet web site and an Answer to the complaint or motion under Rule 12 of the Federal Rules of Civil Procedure within 21 days thereafter.

ECF No. 7-3 at 2. The notice went on to specify how the verified claim and answer must be filed with the Court and served on the United States Attorney's Office. ECF No. 7-3 at 2.

The government moved for entry of default on November 15, 2013 (ECF No. 7), and the clerk entered an Order of Default on November 18, 2013 (ECF No. 8). The government filed its Motion for Default Judgment and Order of Forfeiture (ECF No. 9) on November 19, 2013. No verified claims or answers to the Complaint for Forfeiture have been filed.

A. Default Judgment

Rule 55(b) of the Federal Rules of Civil Procedure and Supplemental Rule ("Supp. R.") G govern default judgments in forfeiture actions in rem. United States v. $85, 000.00 in U.S. Currency, No. WDQ-10-0371, 2011 WL 1063295 (D. Md. Mar. 21, 2011). "A judgment of forfeiture may be entered only if the government has published notice of the action within a reasonable time after filing the complaint or at a time the court orders." Supp. R. G(4)(a)(i). The government may comply with the publication requirement by "posting a notice on an official internet government forfeiture site for at least 30 consecutive days." Supp. R. G(4)(a)(iii)(c). The notice must "(A) describe the property with reasonable particularity; (B) state the times under Rule G(5) to file a claim and to answer; and (C) name the government attorney to be served with the claim and answer." Supp. R. G(4)(a)(ii). In addition to published notice, the government is required to "send notice of the action and a copy of the complaint to any person who reasonably appears to be a potential claimant on the facts known to the government." Supp. R. G(4)(b)(i). Such direct notice must state "(A) the date when the notice is sent; (B) a deadline for filing a claim, at least 35 days after the notice is sent; (C) that an answer or a motion under Rule 12 must be filed no later than 21 days after filing the claim; and (D) the name of the government attorney to be served with the claim and answer." Supp. R. G(4)(b)(ii). Notice may be sent "to the attorney representing the potential claimant with respect to the seizure of the property or in a related investigation, administrative forfeiture, or criminal case." Supp. R. G(4)(b)(iii). Here, the government complied with Supplemental Rule G's notice requirements by posting a notice on the official government forfeiture website for a period of 30 consecutive days ( see ECF Nos. 9 at 2 & 7-3) and mailing notice to the attorney representing Mr. Wiggins and Ms. White, the only people who reasonably appeared to be potential claimants ( see ECF Nos. 9 at 2 & 7-2). More than 60 days have passed and no verified claim or answer to the Complaint has been filed. See Supp. R. G(5)(a)(ii)-(b).

If the notice requirements are met, the entry of default judgment is a matter within the Court's discretion. SEC v. Lawbaugh, 359 F.Supp.2d 418, 421 (D. Md. 2005) (citing Dow v. Jones, 232 F.Supp.2d 491, 494 (D. Md. 2002)). In determining whether to award a default judgment, the Court will take as true the well-pleaded factual allegations in the complaint, other than those pertaining to damages. Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780 (4th Cir. 2001) ("The defendant, by his default, admits the plaintiff's well-pleaded allegations of fact, is concluded on those facts by the judgment, and is barred from contesting on appeal the facts thus established.") (internal quotations omitted); see Fed.R.Civ.P. 8(b)(6); Agora Fin., LLC v. Samler, No. WDQ-09-1200, 2010 WL 2899036, at *2-3 (D. Md. June 17, 2010) (quoting Ryan, 253 F.3d at 780-81). However, even if a defendant is in default, a court must be satisfied that the complaint states a valid cause of action. See Comm. for Ground Zero Museum Workshop v. Wilson, No. DKC 09-3288, 2013 WL 210621 (D. Md. Jan. 17, 2013); see also Ryan, 253 F.3d at 780 ("The defendant is not held... to admit conclusions of law.... [A] default is not treated as an absolute confession by the defendant of his liability and of the plaintiff's right to recover.") (internal quotations omitted).

Thus, the Court should grant default judgment if the now unchallenged factual allegations support the claim sought by the government. The government's complaint must "state sufficiently detailed facts to support a reasonable belief that the government will be able to meet its burden of proof at trial." Fed.R.Civ.P. Supp. R. G(2)(f). It is the government's burden of proof by a preponderance of the evidence to demonstrate that the defendant currency is subject to forfeiture. 18 U.S.C. § 983(c)(1). Where, as here, the government's "theory of forfeiture is that the property was used to commit or facilitate the commission of a criminal offense, or was involved in the ...


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