United States District Court, D. Maryland, Southern Division
J. HAZEL UNITED STATES DISTRICT JUDGE
Sean Gallman and the Gallman Charitable Trust (the Trust)
filed this quiet title action with respect to real property
known as 4303 Henley Court, Upper Marlboro, Maryland 20772
(the Property). Pending before the Court is the United
States' Motion to Intervene and to Dismiss. ECF No. 2.
For the following reasons, the motion will be granted.
January 2016, Gallman pled guilty to defrauding the United
States by creating entities, including the Trust, through
which Gallman submitted fraudulent tax returns. ECF No. 2-3.
According to the Superseding Indictment that Gallman pled
guilty to, Gallman used the Trust to submit a false tax
return to the Internal Revenue Service and obtained a tax
refund of $8, 218, 930. ECF No. 2-2 at 4. Gallman then
laundered the proceeds of his fraudulent scheme by purchasing
the Property. Id. at 15. On May 18, 2016, this Court
ordered that title to the Property be forfeited to the United
States. ECF No. 2-4.
2016, around the time that the Court ordered that title to
the Property be forfeited to the United States, Defendant SSC
6 - MD, LLC (“SSC”), purchased the Property's
outstanding tax liability owed to Prince George's County.
ECF No. 2-5. SSC then filed a lawsuit seeking to foreclose
the right of redemption in the Circuit Court of Maryland for
Prince George's County. Id. After it filed the
lawsuit to foreclose the right of redemption, SSC discovered
the United States' interest in the Subject Property, and
SSC served the United States with the Complaint. ECF No. 2-1
at 3. The United States and SSC have been working to resolve
that litigation. Id.
to Rule 24(a)(2), “the court must permit anyone to
intervene who: . . . claims an interest relating to the
property or transaction that is subject of the action, and is
so situated that disposing of the action may as a practical
matter impair or impede the movant's ability to protect
its interest[.]” Fed.R.Civ.P. 24(a)(2). Three elements
must be demonstrated before a party can intervene as a matter
of right: “(1) an interest in the subject matter of the
action; (2) that the protection of this interest would be
impaired because of the action; and (3) that the
applicant's interest is not adequately represented by
existing parties to the litigation.” Stuart v.
Huff, 706 F.3d 345, 349 (4th Cir. 2013) (quoting
Teague v. Bakker, 931 F.2d 259, 260-61 (4th
the United States: (1) has an interest in the Property
because the Court vested title to the forfeited property in
the United States; (2) the United States' interest are
impaired by this suit because the action seeks to quiet title
to the Property in favor of the Plaintiffs; and (3) the
current parties cannot protect the United States'
interest because Plaintiffs' interest and Defendant
SSC's interest are adverse to the United States'
interest. See Stuart, 706 F.3d at 349; United
States v. 92 Buena Vista Avenue, 507 U.S. 111, 125-26
(1993) (providing that title to forfeited property vests in
the United States). Accordingly, the United States will be
permitted to intervene.
United States also moves to dismiss Plaintiffs'
Complaint. A motion to dismiss for failure to state a claim
under Rule 12(b)(6) tests the sufficiency of a complaint.
Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir.
2008). To survive a motion to dismiss, a complaint's
“‘[f]actual allegations must be enough to raise a
right to relief above the speculative level, '”
thereby “‘nudg[ing] their claims across the line
from conceivable to plausible.'” Aziz v.
Alcolac, Inc., 658 F.3d 388, 391 (4th Cir. 2011)
(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555, 570 (2007)) (correction in original).
Plaintiffs fail to state a claim upon which relief can be
granted because the criminal forfeiture proceeding provided
the exclusive remedy for Plaintiffs to assert an interest in
the Property, and they cannot use this civil proceeding to
collaterally attack the Court's criminal forfeiture
order. See Roberts v. United States,141 F.3d 1468,
1471 (11th Cir.1998); In re Am. Basketball League,
Inc., 317 B.R. 121, ...