Arabaxhi v. Drug Enforcement Admin. CV-97-322-M 09/16/98 UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

Gierqji Arabaxhi, Plaintiff,

v. Civil No. 97-322-M

Thomas A. Constantine, Administrator, Drug Enforcement Administration, Defendant.

O R D E R

In this civil suit plaintiff, Gjergji Arabaxhi, seeks to

challenge an administrative forfeiture of a substantial sum of

cash by the United States Drug Enforcement Administration (DEA)

in connection with his wife's arrest for dealing crack cocaine.

Before the court is defendant's motion to dismiss for lack of

subject matter jurisdiction. Plaintiff objects, and has himself

filed a motion for partial summary judgment.

Background1

1. The Seizure

In the early morning of June 21, 1995, DEA and other law

enforcement agents entered plaintiff's residence as part of

"Operation Streetsweeper," a combined state and federal effort

aimed at curbing illegal drug activity. Plaintiff's wife, Drita

1 The government flatly denies most of the critical factual allegations made by Arabaxhi. For purposes of ruling on the pending motion to dismiss, however, the court has taken the facts pled by Arabaxhi as true. Arabaxhi, who had been suspected of selling crack cocaine, was

arrested. Agents seized over $20,000 in currency hidden in

various places in her bedroom.

Plaintiff, a citizen of Albania who resides in New

Hampshire, contends that most of the seized currency belonged to

him. He explains that on May 9, 1995, he was involved in a motor

vehicle accident in Manchester, New Hampshire, which led to a

state court order reguiring him to pay restitution. He claims

that his savings at the time ($6,000.00) were not sufficient to

pay the sum owed, so he arranged to borrow money from his father,

who was still living in Albania.

Plaintiff went to Albania to visit his father and discuss

the loan. Before leaving, he says that he withdrew his savings

from a joint bank account shared with his wife (apparently to

prevent his wife from taking the funds). He gave $1,000.00 in

cash to his wife and says he hid the remaining $5,000.00 in their

apartment. Plaintiff then went to Albania, where he says he

obtained $15,000.00 in United States currency from his father.

Upon returning to this country, on June 20, 1995, the night

before Mrs. Arabaxhi's arrest, plaintiff says he declared his

possession of the currency to the United States Customs Service

at Logan International Airport, Boston, Massachusetts.

Thus, according to plaintiff, when the agents arrived at his

residence the next morning, the $15,000.00 in cash they found in

a pair of pants lying on the bed was in fact the money loaned to

him by his father for an innocent purpose; the $5,000.00 they

2 found hidden in a boot was the money he had withdrawn from his

savings account and hidden from his wife; and the $1,000.00 found

in an envelope inside a purse belonging to Mrs. Arabaxhi was the

money he had given her before he left for Albania. (The envelope

contained an additional $240.00, allegedly the remainder of a

public assistance payment obtained by Mrs. Arabaxhi while

plaintiff was in Albania.)

The DEA sent plaintiff a "notice of seizure" dated July 24,

1995. The notice advised that the "date of first publication"

would be August 2, 1995, and clearly informed plaintiff that

$21,240.00 had been seized from Drita Arabaxhi, his wife, and

that the DEA had begun administrative forfeiture procedures. The

notice further informed plaintiff that he could challenge the

forfeiture in either of two ways. First, he could petition the

DEA for the remission or mitigation of the forfeiture.

Alternatively, he could file a claim and cost bond (or affidavit

of indigency), after which the matter would be administratively

terminated and referred to the U.S. Attorney's office for

initiation of civil forfeiture proceedings in the federal court.

Deadlines were given for exercising each option.

The parties necessarily agree that the notice sent by the

DEA satisfied reguirements found in the relevant statute and

administrative regulations, see

;

, and that the notice was in fact received by plaintiff at

his residence. The notice clearly provided that any

correspondence concerning the forfeiture should be submitted to

3 the DEA Asset Forfeiture Section in Arlington, Virginia.

Accordingly, Arabaxhi was reguired to file an administrative

petition with the DEA for remission of the forfeiture by August

27, 1995 (30 days after July 28, the date he received the

notice). Alternatively, he was reguired to file a claim for

judicial relief with the DEA, and post a costs bond (or

declaration of indigency), by August 22, 19 95 (20 days after

August 2, the date of first publication) if he wished to

iudicially contest the seizure and forfeiture of the currency.

Plaintiff did not file either an administrative petition or

a claim for judicial relief within the prescribed time limits.

Conseguently, the seized currency was administratively forfeited

on September 27, 1995.2

2. Plaintiff's Efforts to Contest the Seizure

Plaintiff says he at least attempted to timely exercise his

right to contest the forfeiture, but was thwarted by his lack of

fluency in the English language and by DEA employees who would

not accept his claim or assist him in pursuing it. Plaintiff

begins his story by relating that his wife's criminal attorney

advised him to wait until after the charge against her had been

resolved before challenging the seizure — guestionable advice to

follow from plaintiff's perspective, but advice that he says

nevertheless led him to delay efforts to recover the seized

2 Two days prior to the actual forfeiture, the government moved to dismiss the indictment against Drita Arabaxhi.

4 funds. On August 21, 1995, plaintiff learned that his wife's

criminal case would indeed be dismissed, but that his wife's

attorney would not assist him in recovering the seized funds, due

to a potential conflict of interest. On August 22, 1995,

allegedly following additional advice from his wife's counsel,

plaintiff visited the United States Attorney's Office in Concord,

New Hampshire, and asked for assistance in recovering the seized

currency. He claims that someone in the U.S. Attorney's office

told him that the currency was in the custody of the Manchester

Police Department, which also participated in Operation

Streetsweeper (though by that time plaintiff of course had

received rather clear written notice that DEA had the funds and

was in the process of administratively forfeiting them). On

August 23, 1995 (after the time for judicially contesting the

forfeiture had expired) plaintiff visited the police department,

only to be referred to the offices of the DEA in Boston.

Plaintiff says he also visited the Boston DEA office, but was

referred back to the Manchester Police Department.

Plaintiff further alleges that he then obtained the

assistance of an interpreter, who drafted a hand-written letter

for him in English, reguesting an extension of time to claim the

seized currency. A separate note was included which read,

"Please help this man put this letter in the proper hands. Thank

you." On August 25, 1995, plaintiff presented the letter and

note to the DEA office in Concord, New Hampshire, together with

the Notice, and indicated that he needed help. The DEA allegedly

5 demanded $3,000, apparently as a cost bond, which the plaintiff

was unable to pay due to indigence. Plaintiff says the DEA did

not mention, or assist him in executing, an affidavit of

indigency in lieu of posting a cost bond (of course, the time for

invoking iudicial review had already expired on August 22) .

Instead, the DEA allegedly referred plaintiff to the Concord

office of the United States Attorney. There, plaintiff spoke

with a person allegedly fluent in Greek, a language in which

plaintiff had some facility. Plaintiff says that he clearly

stated his claim, but the Greek-speaking person merely accused

his wife of being a drug dealer and turned him away.

Plaintiff subseguently retained his current counsel, Gordon

Blakeney, Esg. Attorney Blakeney asserts that several months

later, on January 24, 1996, he called a DEA staff attorney who

ostensibly granted an extension of time in which to file a

petition for remission, after hearing Mr. Blakeney's rendition of

the mitigating circumstances. The DEA attorney to whom he spoke.

Senior Attorney Vicki Rashid (formerly Vicki Curcio), confirms

that she spoke to Attorney Blakeney on January 24, 1996, and that

she agreed to a thirty day extension from that date to file a

petition for remission. However, she states that by so doing she

intended simply to extend running time limits, but did not

purport to reopen any limitations periods which had already

expired, and indeed had no such statutory or regulatory

authority.

6 Nevertheless, plaintiff did file an administrative petition

with DEA within thirty days of the apparent extension,3 asserting

his ownership of the currency and seeking remission of the

forfeiture. Notwithstanding her apparent previous authorization,

however. Attorney Rashid determined that the petition had been

erroneously accepted and denied it as untimely. From Attorney

Rashid's affidavit, it appears that since the deadline for filing

had passed well before plaintiff's counsel ever sought an

extension, and the seized currency had already been declared

forfeited back on September 27, 1995, she believed she was

without authority to grant Arabaxhi an extension of time to file

an administrative petition for remission. (It appears that Mr.

Blakeney's January phone call also occurred outside the ninety

day time limit established for filing a petition for the

restoration of proceeds, an avenue of relief available after

forfeiture has occurred. See

.)

On May 13, 1996, the DEA received a motion for

reconsideration from Attorney Blakeney. The DEA responded on

August 20, 1996, again asserting the untimeliness of plaintiff's

administrative petition. However, the DEA further advised

plaintiff that even if the DEA had accepted and ruled on his

untimely petition for remission, the petition would have been

denied on the merits. The letter explained that an undercover

3 Attorney Blakeney's affidavit (document no. 8) makes it plain that whatever the scope of the extension of time at issue, it related only to filing an administrative petition for remission (see e.g. 5 5 : " . . . it is [for a] remission of forfeiture, like a pardon, basically.").

7 police officer purchased cocaine from Mrs. Arabaxhi on five

separate occasions, and each time she retrieved the narcotics

from the bedroom. Noting that all of the seized currency was

removed from various places in that very bedroom, the letter

concluded that there was "a substantial relationship . . .

between the seized currency and controlled substances,

[indicating] probable cause to believe the currency was furnished

or intended to be furnished in exchange for a controlled

substance in violation of

(a)(6)." The DEA also

explained, plausibly, why plaintiff's contrary assertions

regarding the source of the funds lacked credibility.

Discussion

When reviewing a motion to dismiss for lack of subject

matter jurisdiction. Rule 12(b)(1), Fed. R. Civ. P., the court

construes the complaint liberally, treating all well-pleaded

facts as true and giving the plaintiff the benefit of all

reasonable inferences. See Murphy v. United States,

(1st Cir. 1995). Nevertheless, the party invoking the

court's subject matter jurisdiction carries the burden of proving

its existence.

Before considering plaintiff's position, it is necessary to

carefully differentiate between administrative and judicial

forfeitures. Civil forfeiture of property or money furnished in

exchange for or used in connection with illegal activity related

to controlled substances is governed by

, a section of the Comprehensive Drug Abuse Prevention and Control

Act (the "Drug Control Act"). Section 881 directs that such

forfeiture procedures conform to the customs laws,

, et sea.

1. Judicial Relief

The customs laws provide that "property worth $500,000 or

less is subject to administrative forfeiture without judicial

involvement." United States v. Giraldo,

(1st

Cir. 1995)(citing

). An aggrieved individual is,

however, afforded a narrow window of time — within twenty days of

the date the government first publishes notice of the intended

forfeiture — in which to seek judicial relief by filing a claim

with the agency (here, the DEA) and a cost bond of not less than

$250 or, in lieu of a cost bond, a declaration of indigence. See

. "The filing of the claim and the bond stops

the administrative process and reguires the seizing agency to

hand the matter over to the United States Attorney for the

commencement of a judicial forfeiture proceeding." Giraldo, at

510-511 (citing

). In a judicial proceeding, the

agency is reguired to go forward and show probable cause for the

forfeiture. If successful in that effort, the burden of proof

then shifts to the claimant to show that the seized property

belongs to him or her and is not drug related. Boero v. Drug

Enforcement Administration,

(2d Cir. 1997). 2. Administrative Relief

If a claimant fails, or chooses not to follow the procedure

that would entitle him or her to judicial review, the seizing

agency "shall declare the [property] forfeited."

(a). See also

(a). That declaration

has the same force and effect as a final decree of forfeiture in

a judicial proceeding in a federal district court, and title to

the seized property is then deemed vested in the United States.

(b). Here, the property (cash) was declared

forfeited on September 27, 1995.

A claimant may administratively oppose the forfeiture,

however, by filing a petition for remission or mitigation with

the seizing agency, also known as a petition for "pardon" or

"grace." This procedure is "an administrative prelude to the

formal forfeiture proceeding, wherein a valid forfeiture is

presumed." United States v. Morgan,

, 767 n.3 (5th

Cir. 1996);

. "Unlike the claimant who files a

claim [seeking judicial relief] and posts a cost bond, a

petitioner seeking remission or mitigation of a forfeiture does

not contest the legitimacy of the forfeiture. Rather, a petition

for remission or mitigation is a means of ameliorating the

harshness of forfeiture when mitigating circumstances exist."

Morgan,

n.3 (emphasis added).

A petition for remission must be received within thirty days

of receipt of the notice of seizure.

(a). If

a petition is not received within thirty days, the property is

10 either placed in official service or sold as soon as it is

forfeited.

(a).4 If a petition is received,

the DEA asset forfeiture department normally requests an

investigation and then forwards the petition, along with a report

of investigation, to the Administrator of the DEA.

. Following an administrative forfeiture, an aggrieved

claimant may file a petition for review of the final agency

decision with the Court of Appeals in the relevant jurisdiction,

, but that review is generally limited to whether

the agency followed the proper procedural safeguards before

declaring the property forfeit. Scarabin v. Drug Enforcement

Administration,

(5th Cir. 1990) .

3. The Court's Subject Matter Jurisdiction Over Plaintiff's Claim

Arabaxhi simply did not comply with any of the procedural

requirements that would have entitled him to iudicial review of

the merits of the DEA's forfeiture decision. He did not file a

claim and post a cost bond (or assert indigency) with the DEA

within the allotted 20-day period, and he received

constitutionally adequate notice of the requirement.

His counsel contends, however, that this court nevertheless

has subject matter jurisdiction over his claims, either under the

4 Within 90 days of the date on which the property is placed into official use, a claimant may still file a petition for restoration of the value of the property.

(b) .

11 Administrative Procedures Act or pursuant to the court's

"inherent equitable powers."

A. The APA

Contrary to plaintiff's assertions, it is unmistakably clear

that the APA does not confer subject matter jurisdiction on this

court under these circumstances. The plaintiff has sued an

agency of the United States government, but he neither asserts

nor identifies any explicit waiver of sovereign immunity. The

APA itself provides no waiver of sovereign immunity when a

controlling statute precludes judicial review of the matter at

hand.

. And, the Court of Appeals for the First

Circuit has determined that the forfeiture section of the Drug

Control Act and its implementing regulations, described above,

constitute "a statute precluding review" of forfeiture actions

within the meaning of that subsection. Sarit v. United States

Drug Enforcement Administration,

(1st Cir. 1993) .

The only exception noted in Sarit suggests that a federal

court may exercise preliminary jurisdiction to determine whether

the notice of forfeiture received by a petitioner was adequate in

light of due process requirements.

But once a district

court finds the notice to be constitutionally sufficient,

§ 701(a)(1) applies to deprive the court of subject matter

jurisdiction over the remainder of the case. Id.

Plaintiff concedes, as he must, that the notice he actually

received from the DEA met all statutory and regulatory

12 requirements and plainly informed him of the relevant deadlines

and where to send his claim. The notice he received also

satisfied due process concerns, even given his difficulties with

the English language. See Toure v. United States,

(2d Cir. 1994) . A straightforward application of Sarit, then,

requires this court to acknowledge its lack of subject matter

jurisdiction.

In an effort to bypass Sarit, however, plaintiff's counsel

argues that this court is surely authorized by the APA to at

least review the DEA's denial of plaintiff's administrative

petition for remission of forfeiture.5 Plaintiff's petition for

remission was unquestionably filed with the DEA late, but perhaps

arguably as allowed by agency sufferance, within its discretion.6

Putting that timeliness issue aside for the moment, however, it

is still plain that remission of forfeiture is a matter committed

to the sound discretion of the seizing agency. See Averhart v.

5 Plaintiff's counsel seems to argue that because DEA Senior Attorney Vicki Rashid, acting pursuant to inherent administrative authority, granted an extension of time, all deadlines set out in the notice of forfeiture received by plaintiff were effectively nullified (presumably nunc pro tunc).

6 Though perhaps a more compelling argument, plaintiff does not seem to assert that the DEA should have treated his appearance at DEA offices, and his presentation of the letter requesting help, as the equivalent of filing a formal petition for remission See e.g. United States v. One 1987 Jeep Wrangler Auto,

(2d Cir. 1992). Plaintiff received the DEA's Notice on July 28 and, accepting his allegations, within thirty days (August 25) he personally appeared at DEA offices and made his claim to the currency known. Nevertheless, even if plaintiff had advanced (and prevailed on) that argument, he would be entitled to no more than that which he has already received: administrative consideration of his petition on the merits.

13 United States,

(11th Cir. 1990).

Accordingly, except under carefully defined and very narrow

circumstances, federal courts lack jurisdiction to review the

merits of an administrative forfeiture decision, even one that

constitutes an abuse of discretion. See Averhart,

-44 .

A federal court might exercise preliminary jurisdiction to

review the procedural aspects of a denial of a petition for

remission. For example, other circuits have determined that a

federal court may exercise jurisdiction to review the procedural

safeguards afforded by a seizing agency, particularly when the

agency "does not even consider a reguest that it exercise its

discretion." Averhart v. United States,

(11th Cir. 1990); c f . Scarabin v. Drug Enforcement

Administration,

(5th Cir. 1990) (federal court

may review agency's refusal to exercise jurisdiction over a claim

as well as the nature of any procedural safeguards, but is

precluded from reviewing the merits). On the other hand, when

the government provides a detailed explanation for its denial of

a petition for remission, including an account of the relevant

evidence supporting a probable cause finding (as it did here) it

has conclusively established that it did consider the reguest.

See Averhart, 901 F.3d at 1544; One 1977 Volvo 242 DL v. United

States of America,

(5th Cir. 1981)(noting that

where DEA had provided plaintiff with reasons for the denial of

her petition for remission, federal court was without

14 jurisdiction). C f . Scarabin,

(remanding case to

DEA because, despite opportunity, it failed to review merits of

petitioner's claim). But those potential exceptions do not apply

here.

Although the DEA formally denied plaintiff's petition on

timeliness grounds (and so arguably refused to exercise its

discretion) , for all practical purposes the agency did consider

the petition on the merits, and fully and plausibly explained in

detail why the petition would have been denied even if it had

been accepted as timely. In very real terms then, plaintiff has

been afforded full administrative review on the merits, and has

obtained a detailed explanation as to why his petition, even if

timely, would be denied. The court does not have jurisdiction to

consider the merits of the DEA's administrative decision to

forfeit the currency at issue, and there can be little doubt what

that decision on the merits is (or would be).

B. Equitable Jurisdiction

Undaunted, plaintiff asserts that this court should still

exercise subject matter jurisdiction and grant substantive

relief, based upon its "inherent equitable power" to correct

erroneous administrative actions. To be sure, a federal court

may invoke equitable jurisdiction in "exceptional cases where

equity demands intervention." Averhart,

.

However, the court's equitable powers must be exercised with

caution and restraint, and usually should not be employed when a

15 petitioner has an adequate remedy at law.

. Cf.

United States v. Claqett,

, 1356 n.l (9th Cir.

1993)(observing that a remedy at law does not become inadequate

merely because a claimant failed to invoke it). Plaintiff in

this case had, but failed to properly invoke, an available

iudicial remedy despite having received full and adequate notice

of both the available remedy and how to invoke it. Given that

failure, it would be particularly inappropriate for the court to

exercise equitable jurisdiction over the DEA's administrative

decisions in this case for that reason alone.

In any event, plaintiff's case does not present the kind of

exceptional circumstances warranting equitable intervention. In

light of the asserted facts, and Attorney Rashid's earlier

"authorization," the DEA probably could have entertained

plaintiff's untimely administrative petition on the merits,

perhaps finding that although plaintiff's attempt in August of

1995 to invoke administrative remedies was technically deficient,

he demonstrated sufficient interest in the property and in

asserting his rights that the DEA field offices should have been

more helpful and cooperative, and should have accepted and

considered the petition. (Again, the court is accepting

plaintiff's factual allegations as true.) But, the reality here

is that although plaintiff's petition was formally denied as

untimely, upon reconsideration the DEA did fully review its

substance and concluded that it was without merit.

16 The DEA advised plaintiff, in writing, that even if the

petition had been timely filed and accepted for consideration, it

still would have been denied on the merits, and the DEA explained

why. The explanation was both rational and reasonable, but this

court does not review the merits of administrative decisions to

deny petitions for remission, and, obviously, remanding the

matter to the DEA to reguire more "formal" consideration of the

petition on its merits would be pointless, given that the DEA has

already effectively and, for all practical purposes, made a

determination upon the merits and has provided plaintiff with a

sufficiently detailed explanation of that decision. This is not

a case in which an agency of the government is depriving the

rightful owner of property that should not have been forfeited in

the first place based on a technical "gotcha," and without any

meaningful consideration of the merits of the owner's claim or

the eguities of the situation. See Scarabin,

.

Conclusion

Judicial review of plaintiff's objection to forfeiture is

not available, because the court is without subject matter

jurisdiction. The court is also without jurisdiction under the

APA to entertain his claims, and declines to exercise "eguitable

jurisdiction" under the circumstances of this case. Furthermore,

remand for formal administrative review by the DEA is denied as

pointless since, even assuming DEA's procedural error in deeming

plaintiff's administrative petition untimely, the DEA's de facto

17 consideration of the petition on the merits, and its reasonable

and thorough explanations for the discretionary decision to deny

relief, effectively provided plaintiff full consideration on the

merits.

For the foregoing reasons, the court grants defendant's

motion to dismiss (document no. 4) and denies as moot plaintiff's

motion for partial summary judgment (document no. 5). The clerk

of court shall close this case.

SO ORDERED.

Steven J. McAuliffe United States District Judge

September 16, 1998

cc: Gordon R. Blakeney, Jr., Esg. Jean B. Weld, Esg.

18