United States of America v. $240,000.00 in U.S. Currency

Motion to Dismiss for Failure to State a Claim

N.D. Tex.March 13, 2017

CLAIMANT’S MOTION TO DISMISS – PAGE 1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS FORT WORTH DIVISION UNITED STATES OF AMERICA § Plaintiff § § v. § NO. 3:16-CV-2747-N § $240,000.00 in U.S. Currency § Defendant In Rem § CLAIMANTS’ MOTION AND BRIEF TO DISMISS FOR FAILURE TO STATE A CLAIM FOR RELIEF AND REQUEST TO UNSEAL AFFIDAVIT The claimant, Chas Bray, in the above-entitled and numbered cause, move the Court to dismiss the Plaintiff’s Original Complaint for failure to state a claim, and would show the Court, as follows. 1. This case is an civil forfeiture action filed on September 27, 2016. On February 29, 2017, under Rule G(5)(a)(i) of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions (“Supplemental Rules”) and 18 U.S.C. § 983(a)(4), claimant Chas Bray (“claimant”) timely filed claims on the property which is the subject of the seizure. Defendant’s first responsive pleading is currently due to be filed on March 14, 2017. See Supplemental Rules, Rule G(6)(a)(iv) 2. This motion is made under Supplemental Rules, Rule G(5)(b) and Fed. R. Civ. P. 12(b)(6). In fact, these rules specifically provide for a filing under Fed. R. Civ. P. 12 prior to filing an answer. The Claimant is following this procedure. The Claimant asserts that the complaint fails to establish grounds upon which relief can be granted. 3. The Plaintiff claims jurisdiction to forfeit exclusively under 18 U.S.C. § 981(a)(1)(C) alleging that the property is traceable to a violation of 18 U.S.C. § 1084, which the Case 3:16-cv-02747-N Document 11 Filed 03/13/17 Page 1 of 4 PageID 28 CLAIMANT’S MOTION TO DISMISS – PAGE 2 Plaintiff further alleges is a specified unlawful activity under 18 U.S.C. §§ 1956(c)(7) and 1961(1). (Complaint [ECF 1] at 3-4.) 4. Here, the complaint only alleges in mere conclusions that the property is traceable to a violation of law. There are no additional allegations establishing a violation of 18 U.S.C. § 1084 or demonstrating that the property seized is traceable to this violation of law. The complaint does include a copy of an affidavit in support of the complaint, but this affidavit was filed under seal. Id. at 3. The Plaintiff has refused to unseal the complaint despite requests from the claimant. 5. Seizing property in secret, violates fundamentally notions of due process. Under these circumstances, the claimant is unable to ascertain the basis of forfeiture. If the affidavit remains sealed, then the Plaintiff has been unable to provide notice to the claimant of the basis of the forfeiture and the complaint should be dismissed. At this point, there are no allegations available to claimant that demonstrate sufficient grounds for forfeiture. Unless the Plaintiff moves to unseal the affidavit and demonstrate grounds for forfeiture, this complaint should be dismissed for failure to state a claim for relief. The complaint must be dismissed under Fed. R. Civ. P. 12(b)(6). 6. The applicable federal rules require this result. The Federal Rules of Civil Procedure require that a complaint contain “ ‘a short and plain statement of the claim showing that the pleader is entitled to relief,’ in order to ‘give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.’ ” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1964 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99 (1957)); accord Erickson v. Pardus, 551 U.S. 89, 127 S.Ct. 2197, 2200 (2007) (per curiam). A plaintiff must furnish “more than labels and conclusions” or “a formulaic recitation of the elements of a cause of action.” Bell Case 3:16-cv-02747-N Document 11 Filed 03/13/17 Page 2 of 4 PageID 29 CLAIMANT’S MOTION TO DISMISS – PAGE 3 Atl. Corp., 127 S.Ct. at 1964–65 (citing Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932 (1986)). Supplemental Rule E(2)(a) requires the complaint to “state the circumstances from which the claim arises with such particularity that the defendant or claimant will be able, without moving for a more definite statement, to commence an investigation of the facts and to frame a responsive pleading.” Supplemental Rules E(2)(a)4. To satisfy this Rule, the government must “allege facts sufficient to support a reasonable belief that the property is subject to forfeiture.” United States v. Mondragon, 313 F.3d 862, 865–66 (4th Cir. 2002) (finding that Rule E(2)(a) requires the Government to “allege sufficient facts to support a reasonable belief that the property is subject to forfeiture.”); see also United States v. $49,000 Currency, 330 F.3d 371, 376 n. 8 (5th Cir. 2003) (adopting general standard that under Rule E(2)(a), the Government must allege facts supporting a reasonable belief that it will be able to bear its burden at trial). Here, without notice of specific factual allegations to support relief, this complaint should be dismissed. 7. Claimant further moves for the Court to unseal the affidavit accompanying the complaint. Without such notice, the Claimant is unable to properly defend the case. If the Plaintiff believes that it is unable to release the affidavit, then it should dismiss this action. Forfeiture of property by secret government fiat is a violation of the due process clause of the Fifth Amendment. Further, under the federal rules cited below, the Claimant is entitled to such notice before the civil forfeiture may proceed. Therefore, the claimants in this matter respectfully request that this Court dismiss the complaint for failure to state a claim upon which relief can be granted and further moves to unseal with affidavit accompanying the Plaintiff’s complaint. Claimant also requests any other and further relief to which he may be justly entitled. Case 3:16-cv-02747-N Document 11 Filed 03/13/17 Page 3 of 4 PageID 30 CLAIMANT’S MOTION TO DISMISS – PAGE 4 Respectfully submitted, /s/ Richard B. Roper Richard B. Roper State Bar No. 17233700 Richard.Roper@tklaw.com THOMPSON & KNIGHT LLP 1722 Routh Street, Suite 1500 Dallas, Texas 75201 (214) 969-1700 (214) 969-1751 (Facsimile) ATTORNEY FOR CLAIMANT CERTIFICATE OF CONFERENCE I spoke with AUSA Mark Tindle who indicated that he will not agree for the complaint to be dismissed and will not agree for the affidavit accompanying the complaint to be unsealed. /s/ Richard B. Roper Richard B. Roper CERTIFICATE OF SERVICE I hereby certify that on March 13, 2017, I electronically filed the foregoing document with the clerk for the United States District Court, Northern District of Texas, using the electronic case files system of the Court. The electronic case files system will send a “Notice of Electronic Filing” to the attorneys of record who have consented to accept this Notice as service of this document by electronic means. /s/ Richard B. Roper Richard B. Roper Case 3:16-cv-02747-N Document 11 Filed 03/13/17 Page 4 of 4 PageID 31