10ft 


IN THE UNITED STATES DISTRICT COURT 


FOR THE EASTERN DISTRICT OF PENNSYLVANIA 


JOSE LUIS AREVALO MISCELLANEOUS 


vs. 


UNITED STATES OF AMERICA NO. 05-110 


MEMORANDUM 

ROBERT F. KELLY, Sr. J. FEBRUARY 8, 2011 

Presently before this Court is Defendant, United States of America's ("Government"), 

Motion for Summary Judgment against Plaintiff, Jose Luis Arevalo (Arevalo). Arevalo, a 

convicted drug felon and money launderer seeks relief under Federal Rule of Criminal Procedure 

41(g)' for return of $459,370.00 in United States currency seized by federal agents on July 13, 

1999. For the reasons stated below, this Motion is granted.2 

I. FACTS AND PROCEDURAL BACKGROUND 

On July 13,1999, in connection with an investigation ofa large scale marijuana 


distribution and money laundering operation, U.S. Customs Service Agents in Philadelphia, 


'Federal Rule of Criminal Procedure 41 (g) provides: 

Motion to Return Property. A person aggrieved by an unlawful 


plt:\EO search and seizure of property or by deprivation of property may 


EN" t:. move for the property's return. The motion must be filed in the 


1\" 7 {\, ,district where the property was seized. The court must receive 


ftf\ ( ev4Jence on any factual issue necessary to decide the motion. If it 

-a eQ\(.Or OO~hts the motion, the court must return the property to the movant, 

\jI.IiioIv'" but may impose reasonable conditions to protect access to the 

property and its use in later proceedings. 

2Arevalo states in his pro se Response to the Government's Motion that he too is seeking 

a grant of Summary Judgement. For the reason discussed, infra, Arevalo's Motion is denied. 
Pennsylvania, seized the property ofseveral individuals including Arevalo and two other men, 

John Dugery ("Dugery") and George Early ("Early"). The agents seized from Early $459,370 in 

United States currency together with other personal property, and published notice ofits seizure 

ofthis property. Specifically, on May 10, May 17 and May 24,2000, the government published 

notice ofthe seizure in the Philadelphia Daily News.3 No claims for return ofthe seized currency 

were filed with the U.S. Customs Service within the time required by law. Therefore, on May 

31,2001, the U.S. Customs Service administratively forfeited the seized currency. 

Arevalo and Dugery were prosecuted in the Middle District ofFlorida for conspiracy to 

distribute marijuana.4 On May 4, 1999, a grand jury in the Middle District ofFlorida returned an 

indictment against Arevalo and others charging them with conspiracy to distribute marijuana, in 

violation of 18 U.S.C. § 846, and money laundering, in violation of 18 U.S.C. § 1956. United 

States v. Jose Louis Arevalo, No. 99-CR-158-EAK-1 (M.D. Fla.). On February 15,2000, ajury 

convicted Arevalo of conspiracy to distribute and to possess with intent to distribute 1,000 

kilograms or more ofmarijuana and conspiracy to commit money laundering. On January 12, 

2001, the Court there sentenced Arevalo to a term of360 months imprisonment and 72 months 

supervised release. The conviction and sentence were affirmed by the Eleventh Circuit Court of 

3Also, on May 8, 2000, the United States Customs Service sent written notice ofthe 

proposed forfeiture directly to Early, and his counsel, even though Early abandoned his interest in 

the property at the time ofthe seizure. The U.S. Customs Service also sent notice directly to 

Dugery. 

4Dugery pleaded guilty to Counts One and Two of an Information charging him with 

conspiracy to distribute marijuana, in violation of21 U.S.C. §§ 846 and 841(a)(I), and 

conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h}. United States v. 

Dugery, No. 99-CR-284-EAK (M.D. Fla.). Dugery admitted to conspiring with Arevalo to 

distribute marijuana and commit money laundering. (Def. 's Mot. Summ. J., Ex. Plaintiff at 668­

69, 717-719.) 

2 

Appeals. United States v. Arevalo, 37 Fed. Appx. 504 (Table) (11th Cir. 2002). On October 7, 

2002, the United States Supreme Court denied Arevalo's Petition for Writ of Certiorari. Arevalo 

v. United States, 537 U.S. 926 (2002). Arevalo is currently an inmate at the United States 

Penitentiary in Herlong, California. 

On June 6, 2005, Arevalo filed a Motion for Return of Seized Property Pursuant to Fed. 

R. Crim. P. 41(g). In this Motion, Arevalo claimed an interest in the seized currency, and 

contended that the U.S. Customs Service was aware ofhis interest at the time ofthe seizure. 

(PI. 's Mot. for Return of Seized Property, at 1.) As a result, he contended that the forfeiture of 

the currency was void because the government did not provide him with notice ofthe forfeiture. 

The government responded to Arevalo's Motion, arguing that Rule 41(g) did not apply to 

this proceeding, and that the Motion should have been filed pursuant to Section 983(e) ofthe 

Civil Asset Forfeiture Reform Act of2000 ("CAFRA"). Pub. L. 106-185, 114 Stat. 202 (2000).5 

Section 983( e) codified the practice offederal courts in exercising equitable jurisdiction to 

review the merits of a forfeiture matter. The Government asserted that since CAFRA applies, 

Arevalo's Rule 41 Motion was barred by the five-year statute oflimitation under the statute. We 

agreed and dismissed the Motion on January 16,2006. 

Arevalo appealed this ruling in the Court ofAppeals on May 16, 2006. On August 22, 

2007, the Third Circuit vacated judgment and remanded the matter back to this Court for further 

5Effective December 1,2002, the former Rule 41(e) has been renumbered 41(g), with 

only stylistic changes. See Rule 41, Adv. Comm. Notes, 2002 Amendments. Although the 

present motion is brought under Rule 41(g), many of the cases cited herein were brought under 

the predecessor Rule 41(e), and, for purposes ofthe present motion, the two Rules are used 

interchangeably. 

3 

proceedings. Arevalo v. United States, 238 Fed. Appx. 869, No. 06-2813, 2007 WL 2381039, at 

*1 (3d Cir. Aug. 22,2007).6 The Government timely filed an answer to the Motion, and Arevalo 

filed a Motion for Summary Judgment on June 23, 2008. On August 20, 2008, we entered a 

Memorandum and Order denying this Motion. See Jose Luis Arevalo v. United States, No. 05­

110,2008 WL 3874795, at * 1 (E.D. Pa. Aug. 20, 2008). The Government filed the instant 

Summary Judgment Motion on October 14,2010. 

II. STANDARD OF REVIEW 

Federal Rule ofCivil Procedure 56(c) states that summary judgment is proper "if there is 

no genuine issue as to any material fact and the moving party is entitled to judgment as a matter 

oflaw." See Hines v. Consol. Rail Com., 926 F.2d 262,267 (3d Cir. 1991). The Court asks 

"whether the evidence presents a sufficient disagreement to require submission to the jury or 

whether ... one party must prevail as a matter oflaw." Anderson v. Libertv Lobby, Inc., 477 

U.S. 242, 251-52 (1986). The moving party has the initial burden of informing the court of the 

6The Court specifically determined that although Arevalo characterized his Motion as a 

Rule 41 (g) Motion, "when the property in question has already been forfeited, we will construe a 

Rule 41(g) motion as a civil action in equity." See also U.S. v. McGlory, 202 F.3d 664, 670 (3d 

Cir.2000). 

The Court further held that CAFRA, which became effective on August 23,2000, did not 

apply in this case because the forfeiture challenged by Arevalo commenced prior to this date. 

The Court concluded that "regardless ofwhen Arevalo filed his civil action, because the 

challenged forfeiture proceeding commenced prior to CAFRA's effective date, CAFRA's 

limitation period does not apply." Arevalo, 238 Fed. Appx. at 870-871. 

Additionally, the Court found that pre-CAFRA actions involving the forfeiture of 

property by the United States without proper notice are subject to a six-year limitation period. 

See 28 U.S.c. § 2401(a). The Court held that the earliest time that Arevalo's claim could have 

accrued was July 13, 1999, when the property was seized. Since his action was filed on May 30, 

2005, less than six years later, the Third Circuit determined that the action was barred by the 

statute of limitations period. Id. 

4 

basis for the motion and identifying those portions ofthe record that demonstrate the absence of 

a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). "A fact is 

material ifit could affect the outcome ofthe suit after applying the substantive law. Further, a 

dispute over a material fact must be 'genuine,' i.e., the evidence must be such 'that a reasonable 

jury could return a verdict in favor ofthe non-moving party. '" Compton v. Nat'l League of 

Profl Baseball Clubs, 995 F. Supp. 554, 561 n.14 (E.n. Pa. 1998). 

Summary judgment must be granted "against a party who fails to make a showing 

sufficient to establish the existence of an element essential to that party's case, and on which that 

party will bear the burden ofproof at trial." Celotex, 477 U.S. at 322. Once the moving party 

has produced evidence in support ofsummary jUdgment, the non-moving party must go beyond 

the allegations set forth in its pleadings and counter with evidence that presents "specific facts 

showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e); see Big Apple BMW, Inc. 

v. BMW ofN. Am. Inc., 974 F.2d 1358, 1362-63 (3d Cir. 1992). "More than a mere scintilla of 

evidence in its favor" must be presented by the non-moving party in order to overcome a 

summary judgment motion. Tziatzios v. United States, 164 F.R.n. 410,411-12 (E.n. Pa. 1996). 

Ifthe court determines that there are no genuine issues ofmaterial fact, then summary judgment 

will be granted. Celotex, 477 U.S. at 322. 

III. DISCUSSION 

Although brought pursuant to the Federal Rules ofCriminal Procedure, a motion for the 

return of property under Rule 41(g) is treated as an "equitable civil proceeding." United States v. 

Bennett, 424 F.3d 271, 274 (3d Cir. 2005); see also United States v. McGlory, 202 F.3d at 664; 

United States v. Bein, 214 F.3d 408, 411 (3d Cir. 2005). Where a defendant files a Rule 41 (g) 

5 

motion after the conclusion of criminal proceedings, there is a presumption that the owner ofthe 

property has a right to its return. See United States v. Chambers, 192 F.3d 374, 377 (3d Cir. 

1999). In the absence of a pending criminal proceeding, the evidentiary burden for a Rule 41 (g) 

motion shifts to the government. rd. at 375. The government then has the burden of establishing 

a legitimate reason to retain the property. rd. at 377. At that point, a presumption exists that the 

person from whom the property was allegedly taken has a right to its return, and, to rebut the 

presumption, the government must prove that it has a legitimate reason to keep the property. rd. 

"Generally, a Rule 41(e) motion is properly denied 'ifthe defendant is not entitled to lawful 

possession ofthe seized property, the property is contraband or subject to forfeiture or the 

government's need for the property as evidence continues.'" Id. at 377, citing United States v. 

Van Cauwenberghe, 934 F.2d 1048, 1061 (9th Cir. 1991). 

A. Standing 

The Government first asserts that its Motion for Summary Judgment should be granted 

because Arevalo lacks standing to bring the action. We agree. Standing is a threshold 

consideration in all cases, including matters relating to challenges to the forfeiture ofproperty by 

the government. See United States v. $8,221,877.16 in U.S. Currency, 330 F.3d 141, 150, n.9 

(3d Cir. 2003), citing United States v. Contents ofAccounts 3034504504 & 14407143 (In re 

Friko Corp.), 971 F.2d 974,984-85 (3d Cir. 1992) (Article III standing is more focused in 

forfeiture cases on whether claimant is either the colorable owner ofthe res or has any colorable 

possessory interest in it). 

Generally, the issue ofstanding in the federal courts is jurisdictional and not subject to 

waiver. See. e.g., Lewis v. Casey, 518 U.S. 343 (1996). Standing is open to review at every 

6 

stage of litigation, and, even if not raised by the parties, the Court has an independent obligation 

to review its own jurisdiction. See Nat'l Org. Of Women V. Scheidler, 510 U.S. 249 (1994). The 

party seeking to invoke the jurisdiction of the court bears the burden ofproving that he has 

standing. See Kadonskyv. United States, 216 F.3d 499,508 (5th Cir. 2000.) 

In the forfeiture context, every person who seeks to challenge the forfeiture of property 

must establish both "statutory standing" and "Article lIT' standing. United States V. 

$8,221.877.16 in U.S. Currency, 330 F.3d at 150, n.9, citing In re Friko Corp., 971 F.2d at 984. 

Statutory standing requires the claimant to comply with the statutory procedures regarding the 

filing ofthe claim, and Article ill standing requires a claimant to establish that he or she has a 

valid ownership or possessory interest in the property subject to forfeiture that entitles him to 

defend some portion ofthe property against its forfeiture. United States v. $487,825.00 in U.S. 

Currency, 484 F.3d 662, 664 (3d Cir. 2007). Article ill standing requires a claimant to show an 

interest in the property sufficient to create a case or controversy. $8,221,877.16 in U.S. 

Currency, 330 F.3d at 150, n.9, citing In re Friko Com., 971 F.2d at 984. 

It is well-established that a person does not have Article ill standing to litigate a forfeiture 

matter against the government unless he has a cognizable legal interest in the particular asset 

subject to forfeiture. See Mantilla v. United States, 302 F.3d 182, 185 (3d Cir. 2002); In re Friko 

Com., 971 F.2d at 984. To meet this requirement, the claimant must present "some evidence of 

his ownership interest to establish standing to contest a forfeiture." Kadonsky, 216 F.3d at 508. 

Such a burden is not rigorous. See United States v. U.S. Currency, $81.000, etc., 189 F.3d 28,35 

(8th Cir. 2003); Matthews v. United States, 917 F. Supp. 1090, 1104 (E.D. Va. 1996) (Rule 41 

requires a "comparatively low standing threshold"). 

7 
It is well- settled that a bare assertion ofownership in the property, without more, is not 

enough to prove an ownership interest sufficient to establish standing. Id.; see also United States 

v. Bethea, 317 Fed. Appx. 182, *2 (3d Cir. 2009); Munoz-Valencia v. United States, 169 Fed. 

Appx. 150, 152 (3d Cir. 2006). To prove standing, a claimant must show that he has a colorable 

ownership or possessory interest in the funds. Contents of Accounts Nos. 3034504504 and 144­

07143,971 F.2d at 985. In Mantilla, the defendant filed an action seeking return offunds that 

government agents obtained from him and his co-conspirators during an undercover operation. 

The district court granted summary judgement for the government holding that public policy 

barred the return of funds that were voluntarily exchanged during a narcotics transaction. On 

appeal, the Third Circuit held that the claimant did not have standing to contest the 

administrative forfeiture of a portion ofthe seized funds. It held that "to prove standing, the 

[claimant] must show that he has a colorable ownership or possessory interest in the funds." 302 

F.3d at 185. The court noted that the facts showed that the agents confiscated the funds from a 

vehicle that Mantilla did not own, possess, or occupy. rd. The court stated that Mantilla failed to 

present any "evidence from which a reasonable trier of fact could discern his colorable interest in 

this amount." Id. 

Here, Arevalo has not presented any evidence demonstrating a colorable ownership or 

possessory interese in the seized currency sufficient to meet the Article ill standing requirement. 

Rather, he can only base his bare unsubstantiated claim that he owns the property on an 

unsupported hearsay statement allegedly made by Dugery at the time ofthe seizure. Arevalo 

7Possession is not an issue here since it is uncontested that the U.S. Customs agents 

seized the money from Earley and Arevalo was incarcerated at that time. 

8 

alleges that at the seizure, "Dugery made it known to U.S. Customs agents that Jose Luis Arevalo 

owned this money." (Def.'s Mot. Surnm. J., Ex. H, ~ 2.) 

The government attempted during discovery to ascertain the nature ofArevalo's interest 

in the seized money. In response, however, Arevalo gave only self-serving non-responsive 

answers to interrogatories. Arevalo only responded in interrogatories that "Dugery was 

transporting the subject property for me, and was under instructions to deliver the property to me, 

and had been in the process oftransporting the property." (Def. 's Mot. Summ. J., Ex. 0 at 4.) In 

addition, Arevalo was deposed in this matter and generally refused to answer questions 

concerning ownership ofthe seized money at issue. 

Q. 	 How did you find out that Dugery made it known to U.S. 

Customs that you owned the money? Do you understand 

my question? 

A. 	 Yeah. I'm not going to answer the questions. 

Q. 	 All right, your objection for the record is noted. Let me 

move on. What is your interest in the money that was 

seized by the U.S. Customs agents in Philadelphia and is 

the subject ofthis case? 

A. 	 It's my money. 

Q. 	 Why is it your money? Let me ask you, let me clarify the 

question. What was your money doing in Philadelphia? 

A. 	 I'm not going to answer it, objection. 

Q. 	 Objection noted for the record. Did Mr. Dugery at that time 

on July 13th, 1999, did Mr. Dugery owe you this money? 

A. 	 No, he didn't owe me the money. It was my money. 

Q. 	 Why was Mr. Dugery in Philadelphia with your money? 

A. 	 Well, let's just say he was holding it for me. 

Q. 	 Why was he holding the money for you? 

A. 	 I'm not going to answer that. Objection. 

(Def.'s Mot. Surnm. J., Ex. M at 24-25.) 

Q. What was Mr. Earley's business with Mr. Dugery on July 

9 

13th, 1999? 

A. 	 I'm not going to answer that question. Objection. 

Q. 	 IfI may ask you the basis ofyour objection? 

A. 	 Well, I still believe it is irrelevant. 

Q. 	 Okay. Mr. Arevalo, I will get right to the point, was that 

money that was in Philadelphia seized by U.S. [C]ustoms 

agents on July 13th, 1999, was that the proceeds ofyour 

drug dealing activities? 

A. 	 I'm not going to answer that. 

Q. 	 And the basis ofyour objection? 

A. 	 Irrelevant. 

(Id. at 26.) 

Q. 	 When did Dugery tell you? Do you recall when he told you 

the money was seized? 

A. 	 He told me when we were in the county jail in Tampa. 

ilii at 26.) 

Q. 	 What did Dugery tell you? 

A. 	 I'm not going to answer that. 

Q. 	 Relevancy? 

A. 	 Yes. 

Q. 	 Okay, I want to ask you this one last question, and I want to 

ask it one last time, what was the source of funds that you 

claim were, that you owned that were seized by customs 

agents on July 13th, 1999? 

A. 	 It's irrelevant. Objection. 

(Id. at 28-29.) 

Arevalo also refused to answer other questions regarding his assets and income. (ML.) He 

10 

did, however, acknowledge that he admitted to agents that he imported and distributed marijuana, 

although he claimed that such admission was made under coercion alleging that the agents 

threatened to arrest his mom, dad, and wife. (Id. at 26.) 

Arevalo's bare assertion that Dugery was transporting the currency for him and that 

Dugery was under instructions to deliver the currency to him is not sufficient to show that he 

exercised dominion and control over the property. Arevalo has simply offered no evidence that 

he had a colorable interest in the property. Not only has Arevalo failed to produce any evidence 

of a colorable interest in the property, but he outright refused to explain the nature of his 

relationship to the property when given the opportunity to do so at his deposition. Thus, Arevalo 

has failed to meet the low threshold to establish Article III standing in this case. His unsupported 

allegations regarding the seized money do not satisfy the standing requirement necessary for him 

to challenge the forfeiture of the property in federal court. Accordingly, this Court lacks 

jurisdiction to consider Arevalo's Rule 41 motion, and the Government's Motion is granted. 

B. Due Process 

Arevalo has asserted that his due process rights were violated during the administrative 

forfeiture ofthe seized money. The Government counters that Arevalo cannot challenge the 

completed administrative forfeiture of the seized money because he was not a party that was 

required to receive notice ofthe agency's forfeiture proceedings. We again agree. 

21 U.S.c. § 881(a) authorizes the civil forfeiture of property that constitutes the proceeds 

ofillegal drug transactions. That section specifically provides for the civil forfeiture of property 

or money "furnished or intended to be furnished by any person in exchange for a controlled 

substance in violation ofthis subchapter, all proceeds traceable to such exchange, and all moneys 

II 

· .. used or intended to be used to facilitate any violation ofthis subchapter." 21 U.S.C. § 

88 1 (a)(6). This section also provides that relevant provisions ofthe custom laws, 19 U.S.C. § 

1600, et seq., are to be applied to seizures and forfeitures pursuant to Section 881. See 21 U.S.C. 

§ 881(d). 

Where, as here, the seized property is $5000,000 or less, the government may use the 

administrative process governed by the customs laws. This process entails no judicial 

involvement. 19 U.S.C. § 1607; 21 U.S.C. § 88 1 (d); United States v. McGlory, 202 F.3d at 670. 

The government is required to publish notice ofits intent to forfeit the property once a week for 

three weeks and to send written notice to any party known to have an interest in the property. 

See 19 U.S.C. § 1607(a). If a claimant files a claim and a cost bond within 20 days after the first 

publication, the administrative process is halted and the seizing agency must tum the matter over 

to the United States Attorney to commence ajudicial forfeiture proceeding, see 19 U.S.C. § 

1608, which is the procedure automatically followed for property valued over $500,000. See 19 

U.S.C. § 1610. Ifa claimant fails to file the bond to contest the forfeiture, the seizing agency will 

make a declaration offorfeiture and title will vest in the United States. See 19 U.S.c. § 1609(a). 

This administrative declaration has the same effect as a final decree and order of forfeiture 

entered in ajudicial proceeding. See 19 U.S.c. § 1609(b). United States v. McGlory, 202 at 670. 

A district court ordinarily lacks jurisdiction to review the DEA's administrative forfeiture 

proceedings. See Linarez v. United States Dem't ofJustice, 2 F.3d 208,212 (7th Cir.1993) 

("[O]nce the government initiates an administrative forfeiture proceeding and the property is not 

the subject of an ongoing criminal proceeding, the district court loses jurisdiction to resolve the 

issue ofreturn ofproperty"). However, "the federal courts have universally upheld jurisdiction 

12 

to review whether an administrative forfeiture satisfied statutory and due process requirements." 

United States v. McGlory, 202 F.3d at 669-70; see also United States v. Woodall, 12 F.3d 791, 

793 (8th Cir. 1993). 

It is undisputed here that the U.S. Customs Service administratively forfeited the seized 

currency without providing direct notice to Arevalo. Thus, the issue is whether Arevalo was 

denied due process because he was not provided with notice ofthe forfeiture proceeding. 

Besides notice by general publication, as noted above, the customs laws only require the agency 

to provide notice of the forfeiture "to each party who appears to have an interest in the seized 

article." 19 U.S.C. § 1607(a); United States v. McGlory, 202 F.3d at 669-70 (government is 

required to send written notice to any party known to have an interest in the property). 

It is clear from the evidence ofrecord that Arevalo did not have an "interest" in the seized 

currency, and thus, U.S. Customs was not required to provide Arevalo with notice ofthe 

forfeiture. The evidence shows that in approximately May 1999, U.S. Customs agents in 

Pennsylvania conducted a collateral criminal investigation ofDugery and others involved in the 

distribution of marijuana. (Tutko Aff., , 5.) Following the arrests ofArevalo and Dugery in May 

1999, agents investigated Dugery's involvement with narcotics distribution and money 

laundering in Pennsylvania in connection with Arevalo's drug organization. (rd.) On July 13, 

1999, U.S. Customs agents in Pennsylvania seized the $459,370 at issue from Earley for 

forfeiture purposes as the proceeds ofDugery's marijuana distribution activities. (rd. at, 9.)8 It 

is undisputed that Dugery and Earley later filed no claims with U.S. Customs for the return of the 

8At the time ofthe seizure, agents recovered part of the currency in a large bucket located 

in Early's truck, and the remaining currency from two buckets that Earley had buried. (Tutko 

Aff.,,8.) 

13 

seized currency. 

As discussed above, there is no credible evidence that Arevalo had a colorable ownership 

in the seized currency. Indeed as noted, when given the opportunity during his deposition to 

explain his ownership ofthe property, Arevalo refused to answer. (Def.'s Mot. Summ. J., Ex. M 

at 24-29.) Accordingly, there is no due process violation, and the Government's Motion should 

also be granted for this reason. 

C. Illegal Drug Proceeds 

Even ifwe were to find that Arevalo has standing and the administrative forfeiture void 

because ofinadequate notice, Arevalo would still not be entitled to the seized currency because 

the overwhelming evidence in this record establishes that the currency was traceable to illegal 

drug transactions. 

The purpose of 18 U.S.C. § 881(a)(6) is to ensure that persons do not benefit from their 

illegal acts, and the law is clear that a claimant cannot prove lawful possession ofdrug money. 

See 21 U.S.C. § 881(a) ("no property rights shall exist" in illegal drug proceeds); United States v. 

Chambers, 192 F.3d 374,376 (3d Cir. 1999) (property must be returned once criminal 

proceedings have concluded, unless it is contraband or subject to forfeiture); See also United 

States v. Clymore, 245 F.3d 1195, 1201 (lOth Cir. 2001). 

Rule 41 stands for the principle that the government may seize evidence for use in a 

criminal investigation and trial, but it should promptly return the property to its rightful owner 

when it no longer has a claim to possession, so long as the property is not contraband or subject 

to forfeiture. See United States v. Chambers, 192 F.3d at 376. However, the court may deny a 

Rule 41 motion "ifthe defendant is not entitled to lawful possession ofthe seized property, the 

14 

property is contraband or subject to forfeiture or the government's need for the property as 

evidence continues." Id. at 377. 

Here, as already discussed, Arevalo cannot prevail on his Rule 41 Motion because he has 

failed to establish any "colorable" interest in the seized property. In addition, there is nothing in 

the record to show that the source ofthe seized currency is anything other than proceeds from 

illegal drug trafficking. As noted earlier, the currency ($459,370) that Arevalo seeks to be 

returned to him, was seized by U.S. Customs agents from Early in connection with a large scale 

marijuana distribution and money laundering operation involving Dugery. Arevalo and Dugery 

were prosecuted in the Middle District ofFlorida. Dugery admitted to conspiring with Arevalo 

to distribute marijuana and commit money laundering. (Def.'s Mot. Summ. 1., Ex. Plaintiff at 

668-69, 717-719.) In February 2000, Arevalo was convicted of conspiracy to distribute and to 

possess with intent to distribute 1,000 kilograms ofmarijuana and conspiracy to commit money 

laundering, and he was sentenced to a term of360 months imprisonment. See U.S. v. Jose Louis 

Arevalo, No. 99-CR-158-EAK-l (M.D. Fla.).9 For the foregoing reasons, the Government's 

Motion for Summary Judgment is granted. 

An appropriate Order follows. 

9In addition, Arevalo's claims under Rule 41 are also barred under the equitable doctrine 

of unclean hands. Under this doctrine, equitable relief would not be available "when the party 

seeking relief has committed an unconscionable act immediately related to the equity the party 

seeks in respect to the litigation." See Highmark, Inc. V. UPMC Health Plan, Inc., 276 F.3d 160, 

174 (3d Cir. 2001). Courts have held that the doctrine of unclean hands applies to Rule 41 

motions. See, e.g., United States v. Howell, 425 F.3d 971,974 (11 th Cir. 2005) (denying 

defendant relief under Rule 41 (g), stating that, according to equitable principles, a defendant 

must come into the transaction with clean hands). In this case, there is no evidence to show that 

the source ofthe seized currency is anything other than illegal drug trafficking. Rather, the 

record indicates that Arevalo is a convicted drug felon seeking the return of drug money seized 

from a confederate. 

15