Court Opinion

ID: 2659823
Source: CourtListenerOpinion
Date Created: 2014-04-03 03:44:21.489337+00
Date Added: 2024-06-11T12:58:23.574800
License: Public Domain

UNITED STATES DISTRICT COURT
                   FOR THE DISTRICT OF COLUMBIA

______________________________
                              )
UNITED STATES OF AMERICA,     )
                              )
          Plaintiff,          )
                              )
          v.                  )     Civil Action No. 12-1905 (RWR)
                              )
SUM OF $70,990,605, et al.,   )
                              )
          Defendants.         )
______________________________)

                   MEMORANDUM OPINION AND ORDER

     Plaintiff United States brings this civil forfeiture in

rem action alleging that the defendant funds -- approximately

$61.3 million in three different banks -- are the proceeds of a

wire fraud and subject to seizure under 18 U.S.C. §§ 983 and 984.

Claimants Hikmat Shadman Logistics Services Co., Hikmat Shadman

General Trading, LLC, Faizy Elham Brothers, Ltd., Everest Faizy

Logistics Services, Hikmatullah Shadman, Najibullah, and Rohullah

move under § 983(f) for immediate release of the seized funds and

additional properties.   The United States also moves for leave to

file a surreply.   Because the claimants have failed to

demonstrate that they are entitled in this action to release of

their seized funds or additional properties, their motion will be

denied.   Because a surreply is unjustified, the United States’

motion also will be denied.
                                 - 2 -

                           BACKGROUND

     The following facts are alleged by the government in its

Second Amended Verified Complaint (“Second Amended Complaint”),

unless otherwise noted.

     The United States filed this civil forfeiture action and

secured seizure warrants upon a finding of probable cause that

the defendant funds were the proceeds of a fraud.    The United

States alleges that Hikmatullah Shadman, as a subcontractor and

owner of Hikmat Shadman Logistics Services Company, “conspired to

obtain payments from the United States for the transportation of

military supplies in Afghanistan through the illegal and

fraudulent use of the wires . . . [by making] bribe payments,

fraudulently inflat[ing] prices, and caus[ing] the United States

to be invoiced for and to make payments of $77,920,605 to two

bank accounts in Afghanistan.”    2d Am. Compl. at 6.   After the

proceeds of the contracts were deposited into an account at

Afghanistan International Bank held by Hikmat Shadman Logistics

Services Company, the funds were transferred in and out of

various accounts in the names of Shadman’s brothers -- Najibullah

(also known as Yaser Elham) and Rohullah, see Claimants’ Mem. for

Immediate Release of Seized Property Pursuant to 18 U.S.C.

§ 983(f) (“Claimants’ Mem.”) at 5 -- as well as accounts in the

name of their companies, Hikmat Shadman Logistics Services,

Hekmat Shadman General Trading LLC, Faizy Elham Brothers, Ltd.,
                               - 3 -

Everest Faizy Logistics Services, and Yaser Elham at Afghanistan

International Bank, Bank Alfalah, and Emirates NBD Bank.    In

total, the United States has restrained $63,049,141, with

$52,949,141 coming from accounts in Bank Alfalah and Emirates NBD

Bank, and $10.1 million coming from Afghanistan International

Bank under the seizure warrants.

     On August 27, 2013, Shadman, Najibullah, and Rohullah filed

a verified claim and statement of interest in the seized

property, asserting that they are the owners of the seized funds.

Verified Claim and Statement of Interest or Right in Property

Subject to Forfeiture In Rem (“Verified Claim”) at 8.    They made

these claims both individually and on behalf of their companies.

Id. at 14-16.   It appears that all the accounts are held in the

name of the companies, rather than the individuals, except for

one of the Emirates NBD Bank accounts.   Id. at 8-12.

     The claimants now move under 18 U.S.C. § 983(f) to have the

funds released.   They argue that the funds should be released

because the “improper seizure” has caused “extreme and

substantial hardships” which “outweigh any risk to the Government

of the dissipation of the seized property.”1   Claimants’ Mem. at

     1
        The claimants make a number of other arguments extraneous
to the disposition of the petition for release. For example,
they argue

     the seizure is overly broad, is disproportional to the
     claimed offenses, and is based on the Government’s
     factual misrepresentations, conscious indifference to
                               - 4 -

24.   The United States argues that the claimants are not entitled

have the seized currency released under § 983(f)(1)(E) and

§ 983(f)(8), provisions governing assets of a business which has

been seized, since this action did not seize a business.    United

States’ Opp’n to Claimants’ Mot. for Immediate Release of Seized

Property Pursuant to 18 U.S.C. § 983(f) (“Opp’n”) at 1.

Additionally, the United States argues that the claimants have

not established the conditions outlined in § 983(f)(1)(A)-(E)

entitling claimants to release, such as “sufficient contacts with

the community to ensure that the property will be available at

trial as required for release of seized assets,” and “hardship by

the continued restraint of the funds.”   Id. at 2.   Finally, the

United States argues that the claimants failed to show “that such

purported hardship outweighs the risk to the United States during

the pendency of the forfeiture proceedings.”   Id.   Claimants

filed a reply, Reply to the U.S.’s Opp’n to Claimants’ Mot. for

Immediate Release of Seized Property Pursuant to 18 U.S.C.

      exculpatory facts, and intentional disregard for the
      rights of Afghan citizens located in Afghanistan who
      has [sic] been completely exonerated of any wrongdoing
      by the sovereign Afghanistan government under
      Afghanistan law.

Claimants’ Mem. at 24. While the claimants assert in their reply
that the proportionality argument “is to be considered at this
stage of the proceedings as an extremely relevant factor as part
of the Section 983(f) balancing test,” Claimants’ Reply at 11,
they provide no support for this proposition. Because none of
these claims is relevant to the analysis under § 983(f), they are
not addressed in this opinion.
                                 - 5 -

§ 983(f) (“Claimants’ Reply”) to which the United States seeks

leave to file a surreply to “respond[] to two of the material

omissions and misstatements” made by the claimants.       United

States’ Motion for Leave to File Surreply (“United States’ Mot.”)

at 1.    The claimants contend that leave should not be granted

because they raised the issues to which the United States wants

to reply in their original petition.       Claimants Opposition to

United States’ Motion for Leave to File Surreply (“Claimants’

Opp’n”) at 7.

                              DISCUSSION

       Under § 983(f), a claimant may request release of the seized

property by filing a petition that sets forth “the basis on which

the requirements” for release are met.       18 U.S.C.

§ 983(f)(3)(B)(i).    “[I]f a claimant fails to establish any one

of the five criteria, its motion for the release of property must

be denied.”    United States v. Value of Certain E-Metal Accounts

at E-Gold Ltd., No. ELH-11-01530, 2013 WL 5664678, at *2 (D. Md.

Oct. 17, 2013) (citing United States v. Undetermined Amount of

U.S. Currency, 376 F.3d 260, 264 (4th Cir. 2004)).       A court is

authorized to release the property only if the claimant proves

that

       (A)   the claimant has a possessory interest in the
             property;
       (B)   the claimant has sufficient ties to the community
             to provide assurance that the property will be
             available at the time of the trial;
       (C)   the continued possession by the Government pending
                                - 6 -

           the final disposition of forfeiture proceedings
           will cause substantial hardship to the claimant,
           such as preventing the functioning of a business,
           preventing an individual from working, or leaving
           an individual homeless;
     (D)   the claimant’s likely hardship from the continued
           possession by the Government of the seized property
           outweighs the risk that the property will be
           destroyed, damaged, lost, concealed, or transferred
           if it is returned to the claimant during the
           pendency of the proceeding; and
     (E)   none of the conditions set forth in paragraph (8)
           applies.

18 U.S.C. § 983(f)(1)(A)-(E).    In turn, paragraph (8) prohibits

release of the seized property if it “is contraband, currency, or

other monetary instrument, or electronic funds unless such

currency or other monetary instrument or electronic funds

constitutes the assets of a legitimate business which has been

seized.”   18 U.S.C. § 983(f)(8).

I.   PARAGRAPH (8) CONDITIONS

     Under § 983(f)(8), the court cannot release electronic funds

unless they are “the assets of a legitimate business which has

been seized.”   Id.   Seizure of electronic fund assets of a

business that has not itself been seized in a forfeiture action

does not trigger the provision permitting a court to release the

electronic funds; rather, the prerequisite under paragraph (8) is

the seizure of the business itself in the forfeiture action and

not seizure of the assets of the business.    See United States v.

$159,040.00 in U.S. Currency, Civil Action No. 05-2404 (RBW),

slip op. at 5 (D.D.C. Aug. 1, 2006) (unpublished order denying
                               - 7 -

the motion for the return of seized property) (“The plain

language of the statute would seem to suggest that currency may

only be recovered when a legitimate business has been seized.”)2;

see also United States v. Contents of Account No. 4000393243, No.

C-1-01-729, 2010 WL 3398142, at *1 (S.D. Ohio Jan. 2, 2010) (“In

this exception, a legitimate business is singular, assets is

plural, and has been seized is singular; therefore, has been

seized grammatically must refer to a legitimate business, not

assets.”).   Furthermore, courts have rejected the notion that

seizure of the assets of a business is synonymous with the

seizure of the business.   See, e.g., United States v. 8 Gilcrease

Lane, Quincy Fla. 32351, 587 F. Supp. 2d 133, 140-41 (D.D.C.

     2
        While Judge Walton in $159,040.00 in U.S. Currency
explained that there is an alternative interpretation of the
statute -- that “claimant may recover seized funds if they are
the proceeds of a legitimate business” -- this alternative
interpretation has not been adopted by the courts. Id. at 5-6;
see United States v. Approximately up to $15,034,6633 [sic] in
Funds Contained in Ten Bank Accounts, 844 F. Supp. 2d 1216, 1218
(D. Utah 2011) (surveying cases and finding “[t]he court is not
aware of any case in which this exception was found to apply to
anything other than an actual seized business”). In $159,040.00
in U.S. Currency, Judge Walton found that the claimant in his
case could not satisfy either test. Id. (citing United States v.
$1,231,349.68 In Funds, 227 F. Supp. 2d 125, 129 (D.D.C. 2002)).
Further, in $1,231,349.68 In Funds, Judge Friedman did not
address the argument that the business itself must be seized
because neither side argued that the business itself must be
seized before the funds can be released. 227 F. Supp. 2d at 129.
Rather, Judge Friedman found that, with respect to the funds, the
claimants failed to carry their burden to trace the funds to a
legitimate business. Id. Neither of these cases granted the
petition to release the electronic funds as assets of a
legitimate business.
                               - 8 -

2008) (“Seizure of currency is not the same as seizure of a

business.”); In re Seizure Warrants Issued March 27, 2008, and

April 23, 2008, 593 F. Supp. 2d 892, 894 (N.D.W.Va. 2008)

(finding that, despite petitioner’s request that the court decide

that “seizure of the currency is tantamount to the seizure of the

business,” “[t]here appear to be no reported cases in which such

a doctrine was applied”).

     Here, no business has been seized.   All the defendant

properties are funds within bank accounts.   See, e.g., Contents

of Account No. 4000393243, 2010 WL 3398142, at *1 (“[T]he

government has not sought to seize any business, legitimate or

otherwise.   The Defendants are all bank accounts.   By its plain

language, then, § 983(f) is inapplicable.”).

     In addition to the funds seized under the warrants in rem,

the claimants seek release of property “not identified in the

Government’s Second Amended Verified Complaint,” Claimants’ Mot.

at 8, and argue that “the United States Government . . . ,

regardless of which agency within the Government, has seized the

entire business assets and records (not just funds) of Claimants

Hikmat Shadman Logistics Services Company . . . and has seized

over $61 Million of Claimants’ monetary funds.”   Claimants’ Reply

at 5.   This request is problematic in two respects.

     First, this action is in rem against the named amounts in

the bank accounts, not against any of the businesses of Shadman,
                               - 9 -

Najibullah, or Rohullah.   Here, there is no mention of this other

property in the Second Amended Complaint, nor has the government

seized in this in rem action or under any warrants associated

with this in rem action that other property.3   See Claimants’

Mem. at 24; Opp’n at 3 n.3.   The court’s jurisdiction in an in

rem action is over the seized funds themselves.    While exercising

that jurisdiction, the court “may adjudicate claims of

ownership,” but the court’s jurisdiction does not extend beyond

those seized funds.   See United States v. All Funds in Account

Nos. 747.034/278, 747.009/278, & 747.714/278 in Banco Espanol de

Credito, Spain, 295 F.3d 23, 25 (D.C. Cir. 2002) (“In exercising

in rem jurisdiction, the court has authority over the property

(the res) and may adjudicate claims of ownership.” (emphasis

added)); cf. 4A Charles Alan Wright & Arthur R. Miller, Federal

Practice and Procedure § 1070 (3d ed. 1998) (“[W]hen jurisdiction

is based on property the resulting judgment can affect only the

property that has been brought before the court.”).    A court

presiding over an in rem action is unable to resolve disputes

about other property not properly before it.    See Kokkonen v.

Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994) (“Federal

courts are courts of limited jurisdiction.   They possess only
     3
        The parties suggest that this other property was seized
by the U.S. Counterinsurgency Task Force in Afghanistan. See
Opp’n at 3 n.3; see also Claimants’ Mot. at 7 (stating that the
property was confiscated “under an alleged military warrant”);
Claimants’ Mem. at 17 (stating that U.S. coalition forces seized
Mr. Shadman’s property).
                              - 10 -

that power authorized by Constitution and statute . . . .     It is

to be presumed that a cause lies outside this limited

jurisdiction, and the burden of establishing the contrary rests

upon the party asserting jurisdiction.” (internal citations

omitted)).   Thus, the rights and interests in the business

equipment and documents seized outside this in rem action cannot

be adjudicated here.   Cf. United States v. BCCI Holdings

(Luxembourg), S.A., 980 F. Supp. 2, 8 (D.D.C. 1997) (dismissing

portion of the claim on forfeited property because the court

lacked jurisdiction over the “assets beyond those funds seized

pursuant to the First Order of Forfeiture”); United States v.

BCCI Holdings (Luxembourg), S.A., 923 F. Supp. 264, 265 (D.D.C.

1996) (finding the court lacked subject matter jurisdiction to

adjudicate the validity of the claimants interest in the property

because the assets were not included in the forfeiture order).

     The text of § 981, which outlines the general civil

forfeiture provisions, supports this conclusion.   The section

specifically refers to “motion[s] for the return of property

seized under this section.”   18 U.S.C. § 981(b)(3) (emphasis

added).   The statutory language of § 981 seems to contemplate

jurisdiction solely for property seized under this provision and

therefore only provides a mechanism for release of property

seized in accordance with the forfeiture statutes.
                              - 11 -

     Second, the claimants provide no persuasive legal authority

for their proposition that any seizure by any part of the

government qualifies them to invoke the exception outlined in

§ 983(f)(8), or that any seizure by the military establishes

jurisdiction to decide whether to release that property.    See

Claimants’ Reply at 9.   However, none of the cases that the

claimants cite in their reply brief supports the assertion that

an alleged seizure by the military should be imputed to the

seizing agency in this forfeiture action for the purposes of

§ 983(f), nor do the cases permit the court to exercise

jurisdiction over property not named in the Second Amended

Complaint.

     The claimants argue that under Tri-State Hospital Supply

Corp v. United States, 226 F.R.D. 118 (D.D.C. 2005), “this Court

must consider the acts and motives of all federal agencies

involved in the seizure of Claimants’ entire business, business

property, business records, and monetary funds.”   Claimants’

Reply at 9.   They further allege that the “seizures of

Claimants[’] entire business and the seizure of their monetary

funds are closely connected which have aggregately caused

Claimants’ detailed substantial hardship.”   Id.

     Tri-State, however, is inapposite for two reasons.    First,

it does not stand for the proposition that the claimants can

bring other agencies or the military into this in rem action to
                               - 12 -

seek relief for seizures uninvolved in this action.   The

plaintiff there filed a civil action under the Federal Tort

Claims Act “alleg[ing] that the United States engaged in

malicious prosecution and abuse of process when it issued penalty

notices against Tri-State and sued Tri-State for collection.”

226 F.R.D. at 122-23.   The plaintiff sought discovery about

“agencies other than the Customs Service and Commercial

Litigation Branch of the Justice Department’s Civil Division,

which were identified in Tri-State’s administrative claim,

supplement, and amendment,” and the defendant refused, arguing

that the information was “simply irrelevant.”   Id. at 126-27.

The court allowed discovery “if that information is relevant to

the intent and actions of the government employees and agencies

that were named in the administrative claim” and the information

about intent and motive was potentially relevant because the

plaintiff’s claim involved malicious prosecution.   Id. at 127

(emphasis added).   The court was specifically interested in

whether the desired information was discoverable as relevant to

the plaintiff’s claim, not whether actions by other agencies

should be imputed to the agency being sued in Tri-State.    Id.

Thus, the information about other agencies was relevant to the

motives of the agencies named in the claim; the plaintiff was

nevertheless limited to seeking relief from the agencies that it

sued.   Id.   The court did not hold that the plaintiff could seek
                              - 13 -

relief from those other agencies through the pending action.    See

id.

      Second, in Tri-State, the court had independent jurisdiction

over the parties, rather than in rem jurisdiction over the

property.   The claimants have offered no proof or even an

allegation that there is jurisdiction over either the property

that the military seized, or over the Counterinsurgency Force in

Afghanistan.   By all accounts, the seizures of these other

business assets and property were done by the military, and there

is no evidence that the seizures were done under any

authorization flowing from this case.    See Opp’n at 3 n.3

(seizure by Counterinsurgency Task Force); Claimants’ Mot. at 7

(seizure by military warrant); Claimants’ Mem. at 17 (explaining

that the seizure was by U.S. Coalition forces who posed many

questions to Shadman that were unrelated to this action).     Thus,

the seizures that can be considered here are the seizures under

the in rem warrants associated with this case.    The United States

has seized in this case $63,049,141 in assets from the named

accounts, but has not seized the claimants’ “businesses” for the

purposes of 18 U.S.C. § 983(f)(8).     See 8 Gilcrease Lane, 587 F.

Supp. 2d at 140-41 (finding that the seizure of some currency is

not sufficient to establish seizure of a legitimate business).

Therefore, under § 983(f), the petition to release the seized

funds must be denied.
                               - 14 -

II.   § 983(f)(1)-(4) CONDITIONS

      Even if there had been a seizure of the claimants’

businesses, the claimants would still have to prove that they

have “a possessory interest in the property,” that they “have

sufficient ties to the community,” that they will suffer

“substantial hardship” and that the “likely hardship . . .

outweighs the risk” of loss.   18 U.S.C. § 983(f)(1).   While the

claimants have plausibly shown that they have a possessory

interest in the property and that they will suffer a substantial

hardship, they have failed to demonstrate that they satisfy all

of the remaining four conditions in § 983(f) because they do not

have sufficient ties to the community nor does their likely

hardship outweigh the risk of loss.

      An ownership interest is sufficient to show that the

claimant has a “possessory interest” in the property.   Cf. United

States v. All Assets Held at Bank Julius Baer & Co., Ltd., Civil

Action No. 04-0798 (PLF), 2013 WL 4046558, at *16 (D.D.C.

Aug. 12, 2013) (“A claimant who asserts an ‘ownership interest’

in the defendant property and who presents ‘some evidence of

ownership’ supporting that assertion has satisfied its burden of

demonstrating standing at the summary judgment stage.”).     The

government argues “because none of the Claimants ha[s] asserted

an interest in Seized Asset B, the release of Seized Asset B

. . . is not appropriate.”   Opp’n at 11.   The United States makes
                               - 15 -

no other claims in its opposition regarding the claimants’

possessory interest.    Because the claimants have a colorable

claim of interest as the owners of the accounts, they have a

sufficient possessory interest to satisfy the first condition.

See Verified Claim at 8.

     The claimants also satisfy the third condition, namely, that

they will suffer substantial hardship without release of the

funds.   While the only property at issue is the seized funds, the

claimants state that the continued seizure of the funds is

“interfering with the payments to Claimants’ vendors, employees,

and suppliers . . . [and] prohibiting Claimants from paying its

legitimate business expenses as they come due.”    Claimants’ Mem.

at 30.   This is likely sufficient for establishing a substantial

hardship.   See 8 Gilcrease Lane, 587 F. Supp. 2d at 147 (finding

that the claimant’s inability to “fulfill its current

obligations” to pay outstanding bills a substantial hardship).

     Despite fulfilling those two conditions, the claimants’

claim must nevertheless fail because they cannot fulfill the

final two conditions.

     Claimants are required to have “sufficient ties to the

community to provide assurance that the property will be

available at the time of trial.”    18 U.S.C. § 983(f)(1)(B).    The

claimants have not demonstrated that they have sufficient ties to

this community -- at least the United States, if not the District
                              - 16 -

of Columbia -- “to provide assurance that the property will be

available at the time of the trial.”   See id.   The claimants rely

on their ties to Afghanistan to establish this factor.

Claimants’ Mem. at 27-29 (“Claimants have well-established ties

to their respective communities to provide assurance of the

availability of the seized property at the time of the

trial . . . .”).   The claimants argue that “sufficient ties to

the community” does not refer in this case to the United States.

Claimants’ Reply at 12.   However, the relevant community in this

case is at least the United States, if not the Washington D.C.

area.   For example, in United States v. $1,231,349.68, the court

analyzed whether the claimants, a mother and a daughter, had

significant ties to the Washington D.C. area -- because that is

where the case was heard -- and determined that because they

resided in the area for 22 years and they were U.S. citizens,

they had a sufficient tie to the area.   227 F. Supp. 2d 125, 128

(D.D.C. 2002).

     In contrast, in United States v. 2005 Mercedes Benz E500, a

district court in the Eastern District of California found that

the claimant did not have sufficient ties despite owning property

in the community because the claimant did not reside in that

community.   847 F. Supp. 2d 1211, 1215 (E.D. Cal. 2012) (“For the

purposes of this subsection, sufficient ties to the community are

generally found when a individual is ‘born and raised’ or resides
                                - 17 -

in the community.”).     There, despite the claimant’s established

ties to a neighboring community, that court stated, “Section

983(f)(1)(B) does not allow for strong ties to a neighboring

community to suffice as sufficient ties to the relevant

community.”   Id.    Thus, in this case, the “community” in

§ 983(f)(1)(B) must at least be the United States, if not the

Washington, D.C. area.

     The claimants have no ties to this community or area, nor do

they allege that they have sufficient ties to this community.

Therefore, there is no assurance that the property will be

available should the claim go to trial.     This alone is sufficient

to deny relief since all five conditions under § 983(f)(1)(A)-(E)

must be satisfied to secure release of seized property.

     Additionally, the claimants fail to satisfy the fourth

condition -- that the hardship outweighs the risk of loss if the

property were to be released.     To satisfy this condition,

claimants must prove that “the claimant’s likely hardship from

the continued possession by the Government of the seized property

outweighs the risk that the property will be destroyed, damaged,

lost, concealed, or transferred if it is returned to the claimant

during the pendency of the proceeding.”     18 U.S.C.

§ 983(f)(1)(D).     The claimants state that the release of the

funds “would allow the legitimate business operations of [Hikmat

Shadman Logistics Services] to continue and make additional
                               - 18 -

revenue to ensure the availability of sufficient funds.”

Claimants’ Mem. at 40.   Additionally, in explaining the hardship

that the seizure has caused, the claimants referred to their

inability to pay their bills and expenses without the funds.      Id.

at 30.   This shows that the claimants intend to use the released

funds, making “[t]he likelihood that these funds, if released,

[would] be unavailable for trial in these proceedings . . .

almost assured.”   $1,231,349.68 in Funds, 227 F. Supp. 2d at 129.

As in 8 Gilcrease Lane, where the requested funds were going to

be used to pay attorneys and other professionals, this intended

use of the funds means that the funds would not be available at

trial if they were released.   See 8 Gilcrease Lane, 587 F. Supp.

2d at 147 (“[T]he [c]ourt is not authorized to order the release

of funds that are guaranteed to dissipate upon their release with

no guarantee of an equivalent replacement.”).    Moreover, “the

ease with which cash can be transferred or otherwise disposed of”

“weighs strongly in the government’s favor,”    $1,231,349.68 in

Funds, 227 F. Supp. 2d at 129, particularly since “Section 983(f)

places great emphasis on ensuring the preservation of any

released property pending the final disposition of forfeiture

proceedings,” 8 Gilcrease Lane, 587 F. Supp. 2d at 147 (quoting

Undetermined Amount of U.S. Currency, 376 F.3d at 265).    In the

claimants’ reply, they do not retract or address their statements

that they intend to use the seized funds if the funds are
                                - 19 -

released.   Therefore, the claimants have failed to show that

their hardship outweighs the risk of loss of the funds.

III. UNITED STATES’ MOTION FOR LEAVE TO FILE A SURREPLY

      “The standard for granting a leave to file a surreply is

whether the party making the motion would be unable to contest

matters presented to the court for the first time in the opposing

party’s reply.”    Lewis v. Rumsfeld, 154 F. Supp. 2d 56, 61

(D.D.C. 2001).    A surreply is not justified to correct “an

alleged mischaracterization.”    Id.

      The United States seeks to file a surreply to address the

military tribunal’s proceedings, as well as the current status of

Shadman’s other assets.    As the claimants state in their

opposition, they discussed the military tribunal’s proceedings in

their original motion for release of funds.    Claimants’ Opp’n at

7.   Thus, addressing the military tribunal does not justify

filing a surreply because the issue is not a new matter, nor is a

surreply allowed to correct a “misstatement.”    Additionally, a

surreply addressing Shadman’s other assets is not warranted since

the claimants did not bring up the current status of Shadman’s

other assets in their reply.

                        CONCLUSION AND ORDER

      The claimants have failed to prove that they are entitled to

immediate release of the property seized under § 983(f) because

there has been no seizure of a business in this case.    Even if
                             - 20 -

there had been a seizure of a business, they have failed to

satisfy the remaining four conditions for release under § 983(f).

Additionally, a surreply is unjustified because the claimants did

not bring up new matters in their reply.   Accordingly, it is

hereby

     ORDERED that the claimants’ motion [27] to release funds and

other property, be, and hereby is, DENIED.     It is further

     ORDERED that the United States’ motion [35] to file a

surreply be, and hereby is, DENIED.

     SIGNED this 5th day of November, 2013.4

                                       /s/
                              RICHARD W. ROBERTS
                              Chief Judge

     4
        The forfeiture statute calls for a decision on a petition
for a release of property to be rendered not later than 30 days
after the petition is filed unless the 30-day limitation is
extended by the court for good cause shown. 18 U.S.C.
§ 983(f)(5). Thus, the deadline for this decision was originally
October 16, 2013. However, the court found good cause to extend
that deadline. The petition raised multiple issues, and attached
68 exhibits; the parties submitted six separate filings in this
round of briefing; and the last of the six filings was submitted
on October 11, 2013, just three business days before the decision
deadline. Careful review and thoughtful consideration of all the
matters presented warranted an extension of the deadline.