Court Opinion

ID: 4375346
Source: CourtListenerOpinion
Date Created: 2019-03-08 17:00:25.493613+00
Date Added: 2024-06-11T12:03:48.022827
License: Public Domain

United States Court of Appeals
                         For the Eighth Circuit
                     ___________________________

                             No. 16-3646
                     ___________________________

                          United States of America,

                     lllllllllllllllllllllPlaintiff - Appellee,

                                        v.

                       $579,475.00 in U.S. Currency,

                          lllllllllllllllllllllDefendant,

                              LNG Express, Inc.,

                    lllllllllllllllllllllClaimant - Appellant.
                                   ____________

                  Appeal from United States District Court
              for the Eastern District of Arkansas - Little Rock
                               ____________

                      Submitted: September 25, 2018
                          Filed: March 8, 2019
                             ____________

Before SMITH, Chief Judge, WOLLMAN, LOKEN, COLLOTON, GRUENDER,
BENTON, SHEPHERD, KELLY, ERICKSON, GRASZ, and STRAS, Circuit Judges,
En Banc.
                             ____________
COLLOTON, Circuit Judge.

       This appeal concerns the pleading requirements for a verified claim in a civil
forfeiture proceeding. The case is governed by the Supplemental Rules for Admiralty
or Maritime Claims and Asset Forfeiture Actions, which supplement the Federal
Rules of Civil Procedure. A prior decision of this court held that a claimant who
contests a forfeiture must state its interest in the disputed property “with some level
of specificity,” and that “a general assertion” of an interest in property is insufficient
to satisfy the governing rule of procedure. United States v. $154,853.00, 744 F.3d
559, 562-63 (8th Cir. 2014). The appellant in this civil forfeiture proceeding, LNG
Express, Inc., asks us to reconsider the “specificity” requirement.

       This case arises from a traffic stop conducted by the Arkansas State Police in
September 2014. A state police corporal found two boxes containing $579,475.00
in the cab of a tractor trailer. The government sought to forfeit the money in the
district court on the ground that it was “(1) money intended to be furnished in
exchange for a controlled substance; (2) proceeds traceable to such an exchange; and
(3) money used and intended to be used to facilitate a violation of the Controlled
Substances Act.” See 21 U.S.C. § 881(a)(6).

       LNG, a trucking company, filed a verified claim asserting “a claim to, interest
in, and right to the property seized herein,” and alleging that it was “the owner” of the
seized currency. The government moved to strike LNG’s claim for failing to comply
with Supplemental Rule G(5). See Fed. R. Civ. P. Supp. R. G(8)(c)(i)(A). On the
point in dispute here, Rule G(5) requires that a claim in a civil forfeiture proceeding
must “identify the claimant and state the claimant’s interest in the property.” Id.
G(5)(a)(i)(B). The district court, consistent with our precedent in United States v.
$154,853.00, ruled that LNG’s claim was insufficient to meet the pleading
requirements and struck the claim.

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       We now conclude that the “specificity” requirement imposed by our prior
decision is not supported by the rule, and that LNG’s claim was sufficient to comply
with Rule G(5). A rule of civil procedure should be interpreted in accordance with
its plain meaning. Pavelic & LeFlore v. Marvel Entm’t Grp., 493 U.S. 120, 123
(1989). LNG, by asserting that it was “the owner” of the currency at issue, and that
it had “a claim to, interest in, and right to the property,” satisfied the requirement of
Rule G(5) to “state the claimant’s interest in the property.” To impose a mandate that
the claimant must provide more detail or specificity, such as information about how
it obtained the funds at issue, would go beyond the sparse terms of the rule. Accord
United States v. $31,000.00 in U.S. Currency, 872 F.3d 342, 348-54 (6th Cir. 2017);
United States v. $196,969.00 U.S. Currency, 719 F.3d 644, 646-47 (7th Cir. 2013).

        The government contends that Rule G(5) does not state what level of
specificity is required for a claim, and that the court should look to Supplemental
Rule C and Federal Rule of Civil Procedure 8 to answer the question. While it is true
that if Rule G does not address an issue, then the other rules also apply, see Supp. R.
G(1), we disagree with the government’s premise. Rule G(5) addresses the issue of
what is a sufficient claim; it establishes only a bare-bones requirement to “state the
claimant’s interest in the property.” The absence of a particularity requirement in
Rule G(5), despite its presence elsewhere in Rule G, e.g., Supp. R. G(2)(c),
G(5)(a)(iii), shows that the rulemakers opted not to impose one for stating an interest
in property. Cf. Russello v. United States, 464 U.S. 16, 23 (1983).

       In any event, “[s]pecific facts are not necessary” to state a claim under Rule 8,
Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam), and courts are not licensed
to impose heightened pleading requirements in certain classes of cases simply to
avoid the risk that unsubstantiated claims will burden the courts and opposing parties.
Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512, 514-15 (2002). Rule G sets a low
threshold for the filing of a claim, but provides another mechanism to address
unsubstantiated claims. Rule G(6) allows the government to serve special

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interrogatories that may be used to test the claimant’s relationship to the property at
any time after the claim is filed, and a claimant’s failure to comply with the
interrogatory rule is grounds to strike the claim. Supp. R. G(8)(c)(i)(A).

       The government contends that we should adhere to the prior decision in United
States v. $154,853.00 even if it is incorrect, but we do not think this is an appropriate
case for the application of stare decisis by a regional court of appeals. The prior
decision did not analyze the specificity question under Rule G(5) and seemed to
believe that it was already settled by circuit precedent. 744 F.3d at 562. The cited
decisions, however, involved a predecessor rule with slightly different text and, more
importantly, did not address whether an assertion of ownership is sufficient to state
a claimant’s interest in property. See United States v. Three Parcels of Real Prop.,
43 F.3d 388, 392 (8th Cir. 1994); United States v. $104,674.00, 17 F.3d 267, 268 (8th
Cir. 1994). So it appears in retrospect that the specificity requirement crept into
circuit law without a panel decision that examined the precise issue. The decision in
$154,853.00 created a conflict in the circuits, and another circuit later rejected this
court’s approach, so leaving an erroneous precedent in place would perpetuate
unwarranted disuniformity in the law. Addressing such a conflict in authority is one
of the exceptional circumstances for which en banc review is designed. Fed. R. App.
P. 35(b)(1)(B). We therefore overrule the portion of our decision in United States v.
$154,853.00 that imposed a specificity requirement for the statement of a claimant’s
interest in property under Rule G(5)(a)(i)(B). See 744 F.3d at 562-63.

      For these reasons, we reverse the district court’s order striking LNG’s claim
and remand the case for further proceedings. The district court’s order also
commented on LNG’s invocation of the Fifth Amendment in response to certain
special interrogatories, and resulting prejudice to the government, but we do not read
the order to cite the interrogatory responses as an independent ground for striking
LNG’s claim. We thus leave that matter for further consideration on remand.
                        ______________________________

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