134 Nev., Advance Opinion 11
IN THE COURT OF APPEALS OF THE STATE OF NEVADA
IN RE THE EXECUTION OF SEARCH No. 71536-COA
WARRANTS FOR: 12067 OAKLAND
HILLS, LAS VEGAS, NEVADA 89141;
54 CAROLINA CHERRY DRIVE, LAS
F VMAI gl'A
VEGAS, NEVADA 89141; 5608 QUIET DEC 1 3 2018
CLOUD DRIVE, LAS VEGAS, NEVADA ZAPETI q.;:Crh"Pl
89141; AND 3321 ALCUDIA BAY
BY-
AVENUE, LAS VEGAS, NEVADA CrEAR--
89141.
LAS VEGAS METROPOLITAN POLICE
DEPARTMENT,
Appellant,
vs.
LAURA ANDERSON,
Respondent.
Appeal from a district court order awarding attorney fees in the
context of a motion for the return of seized property. Eighth Judicial
District Court, Clark County; Ronald J. Israel, Judge.
Reversed.
Marquis Aurbach Coffing and Nicholas D. Crosby, Las Vegas,
for Appellant.
Kathleen Bliss Law PLLC and Kathleen Bliss Quasula, Henderson,
for Respondent.
BEFORE SILVER, C.J., TAO and GIBBONS, JJ.
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OPINION
By the Court, TAO, J.:
NRS 18.010(2)(a) permits an award of attorney fees to a
"prevailing party" in a civil action when that party recovers a money
judgment in an amount less than $20,000. At issue here is whether that
provision permits a fee award against a police department ordered to return
a large amount of cash (and other property) seized pursuant to a criminal
search warrant.
We conclude that it does not because an order to return seized
cash is an order to return physical property, not a "money judgment," and
therefore we reverse the district court's award of fees. Further, we decline
to affirm the award under NRS 18.010(2)(b) and in so doing we clarify the
evidentiary burdens that parties litigating return-of-property motions
against a police department must meet under NRS 179.085.
FACTUAL AND PROCEDURAL HISTORY
Suspecting respondent Laura Anderson of running a secret
prostitution ring, the Las Vegas Metropolitan Police Department (LVMPD)
obtained a series of search warrants allowing it to look for contraband in
five properties connected to her. Acting on those warrants, officers seized
automobiles, electronics, and other personal effects, including more than
$50,000 in cash.
Nine months then elapsed without any criminal charges being
filed against her and without any civil forfeiture proceedings being initiated
against the seized property. Anderson filed a civil motion under NRS
179.085 seeking the return of all property seized during the search. Her
motion did not challenge the legality of the search or the manner in which
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it was conducted, but only whether LVMPD's continued retention of the
property remained reasonable in the absence of criminal charges.'
LVMPD initially filed a written partial opposition to the motion
agreeing that it possessed a legal duty to return property that no longer had
any evidentiary value and stipulating to the immediate return of some
computer equipment and memory devices whose contents had been copied.
The written opposition asserted that the other seized evidence, including
the large amount of cash, could not yet be returned because it was relevant
to a federal criminal investigation that was ongoing at the time.
Something changed between the time the written briefs were
filed and the date of the oral argument on Anderson's motion. When counsel
for LVMPD appeared for the hearing, he abandoned the arguments made
in the written briefing and instead informed the district court that he had
recently learned that the federal investigation had terminated without the
filing of any charges. He therefore verbally stipulated that all property
could be returned to Anderson. Based on this non-opposition, the district
court granted Anderson's motion and ordered the property returned.
Anderson thereafter filed a motion seeking an award of
attorney fees against LVMPD pursuant to NRS 18.010(2). In her motion,
Anderson contended that she was a "prevailing party" entitled to fees under
NRS 18.010(2)(a) and, alternatively, that the police department mounted a
defense to her motion "without reasonable ground," entitling her to fees
"NRS 179.085 originally allowed individuals to seek return of seized
property only on grounds that the underlying search and seizure were
unlawful, but before Anderson filed her motion the Legislature amended it
to add the additional ground that law enforcement's continued retention of
the property was unreasonable in light of all the circumstances. See 2015
Nev. Stat., ch. 113, § 1, at 405-06.
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under NRS 18.010(2)(b). The district court issued a written order awarding
Anderson $18,255 in attorney fees under NRS 18.010(2)(a) but did not
address Anderson's contention that an attorney fee award was warranted
under NRS 18.010(2)(b). LVMPD now appeals the district court's fee award.
ANALYSIS
The district court based its award of attorney fees upon NRS
18.010(2)(a). On appeal, LVMPD argues that this constituted legal error
because recovery of a money judgment is a prerequisite to an award of
attorney fees under that subsection. Anderson counters that the underlying
judgment was monetary in nature because some of the property she
recovered was cash. Alternatively, she argues that this court could affirm
the award under NRS 18.010(2)(b), under the doctrine of "right result,
wrong reason." See Saavedra-Sandoval v. Wal-Mart Stores, Inc., 126 Nev.
592, 599, 245 P.3d 1198, 1202 (2010) (holding that appellate courts "will
affirm a district court's order if the district court reached the correct result,
even if for the wrong reason").
Standard of review
This court reviews a district court's award of attorney fees for a
"manifest abuse of discretion." Thomas v. City of N. Las Vegas, 122 Nev.
82, 90, 127 P.3d 1057, 1063 (2006) (internal quotation marks and citation
omitted). "But when the attorney fees matter implicates questions of law,
the proper review is de novo." Id. Here, the question is whether a district
court may award attorney fees at all under NRS 18.010(2)(a) in a return-of-
property action brought under NRS 179.085, which is a question of law.
Thus, our review is de novo. See Valley Elec. Ass'n v. Overfield, 121 Nev. 7,
8-11, 106 P.3d 1198, 1199-200 (2005) (reviewing de novo the question of
whether landowners in condemnation actions may be awarded attorney fees
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as prevailing parties under NRS 18.010(2)(a)); see also Arguello v. Sunset
Station, Inc., 127 Nev. 365, 368, 252 P.3d 206, 208 (2011) ("Questions of
statutory construction, including the meaning and scope of a statute, are
questions of law, which this court reviews de novo." (internal quotation
marks, alterations, and citation omitted)).
NRS 18.010(2)(a) cannot support an award of attorney fees when no money
judgment has been entered
LVMPD argues that the district court's award of fees cannot be
justified under NRS 18.010(2)(a). As always, the proper place to begin is
with the plain text of the relevant statute, and if those words are
unambiguous, that is where our analysis ends as well. See Pawlik v. Deng,
134 Nev. „ 412 P.3d 68, 71 (2018).
NRS 18.010(2)(a) states that a district court may award
attorney fees to a "prevailing party" when that party "has not recovered
more than $20,000." The Nevada Supreme Court has explained that this
latter phrase represents an important limitation on the scope and reach of
the statute, restricting it "to situations where the prevailing party's
recovery was readily measurable against the standard set forth in the
statute," meaning that it "ha[s] effect only when a party recovered some
amount. . . in damages." Smith v. Crown Fin. Servs. of Am., 111 Nev. 277,
282-83, 890 P.2d 769, 773 (1995); see Thomas, 122 Nev. at 93-94, 127 P.3d
at 1065-66 (reaffirming money judgment requirement and refusing to
overrule Crown Financial). Such awards are permitted only in suits
involving money judgments, which excludes actions seeking only
declaratory or equitable relief.
A return-of-property action under NRS 179.085(5) is not an
action seeking an award of money damages. Rather, the plain text of the
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statute states that a motion for return of seized property "filed when no
criminal proceeding is pending. . . must be treated as a civil complaint
seeking equitable relief." NRS 179.085(5). Thus, a movant seeking relief
only under NRS 179.085(5) is not eligible for an award of attorney fees
under NRS 18.010(2)(a).
Anderson nonetheless counters that the underlying judgment
was not merely equitable but rather fundamentally monetary in nature
because some of the seized property was in the form of a large amount of
cash (around $50,000). But the terms of the judgment itself concern the
return of property. The mere fact that some of that property happened to
be in the form of cash does not convert the nature of the award itself into
one for a money judgment. Unlike a true money judgment, the judgment
here was not constructed to award money damages as compensation for
some injury inflicted upon Anderson, and she would not have been entitled
to satisfy it by attaching or executing against other assets of LVMPD until
paid in full. Quite to the contrary, in return-of-property actions like this
one, NRS 21.020(5) limits collection and execution to delivery of the
specified property and nothing more, unless the judgment itself itemizes
other costs or monetary damages. In any event, Anderson's argument fails
on its own terms because, even if we somehow considered the district court's
order to be a money judgment, the amount of cash seized exceeded $50,000.
This sum falls outside the scope of NRS 18.010(2)(a), which is limited to
cases involving judgments of $20,000 or less. Consequently, the district
court erred by awarding attorney fees under NRS 18.010(2)(a).
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The attorney fees award cannot be affirmed under NRS 18.010(2)(b) because
the district court did not enter the required findings
Alternatively, Anderson argues that she was entitled to
attorney fees under NRS 18.010(2)(b). NRS 18.010(2)(b) permits an award
of attorney fees where a claim or defense was "brought or maintained
without reasonable ground or to harass the prevailing party." Anderson
contends that the district court's award of attorney fees can be affirmed
under NRS 18.010(2)(b) because LVMPD failed to present any "credible
evidence" with its opposition to her motion that justified the nine-month
retention of her property. 2
Anderson's argument
As an initial observation, Anderson's argument conflates two
very different things that must be sorted out. Anderson argues that
attorney fees are warranted because LVMPD failed to provide proof that it
had good reason to keep her property for so long without filing criminal
charges. But NRS 18.010(2)(b) targets only how the litigation itself is
conducted, not what the parties did before the litigation commenced.
LVMPD may or may not have had a good reason to keep Anderson's
property; either way, NRS 18.010(2)(b) permits an award of fees only if
LVMPD "brought or maintained" a defense during the litigation itself that
was either groundless or intended to harass.
Within the litigation, Anderson seems to argue that LVMPD
failed to provide "credible evidence" in support of the factual allegations
contained in its opposition to her motion. She cites Frantz v. Johnson, 116
2Anderson also argues that LVMPD's proffered defense was "legally
impossible," but offers little support for that proposition and we decline to
address it.
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Nev. 455, 999 P.2d 351 (2000), and Allianz Insurance Co. v. Gagnon, 109
Nev. 990, 860 P.2d 720 (1993), for the proposition that an award of fees
under NRS 18.010(2)(b) is tested by whether the opposing party presented
"credible evidence" to support its defense. From this, Anderson argues that
LVMPD's opposing brief consisted entirely of argument unsupported by
credible external "evidence" such as affidavits or exhibits, and consequently
NRS 18.010(2)(b) was satisfied and she is entitled to fees.
In effect, Anderson argues that those cases imposed an
affirmative burden of production upon LVMPD to immediately support
everything it said in its opposition with corroborating evidence• at peril of
being later subject to a fee award. But the cases say no such thing. In fact,
the language of those cases refers to the lack of any credible evidence being
presented "at trial" to support the initial allegations contained in the
pleadings. See Bobby Berosini, Ltd. v. People for the Ethical Treatment of
Animals, 114 Nev. 1348, 1354, 971 P.2d 383, 387 (1998) (noting that Allianz
defined a claim as "groundless" if "the allegations in the complaint. . . are
not supported by any credible evidence at trial"). They say nothing about
whether any party possesses any affirmative burden of production on any
issue at the pleading stage of a return-of-property motion.
In the end, the scope of NRS 18.010(2)(b) is defined not by a few
words taken from isolated cases, but rather by the words of the statute
itself. See Antonin Scalia & Bryan A. Garner, Reading Law: The
Interpretation of Legal Texts 56 (2012) (noting that "[Ole words of a
governing text are of paramount concern"). The ultimate inquiry under
NRS 18.010(2)(b) is whether a claim or defense was brought or maintained
"without reasonable ground or to harass the prevailing party," with the
stated goal of "deter [ring] frivolous or vexatious claims and defenses." What
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matters is whether the proceedings were initiated or defended "with
improper motives or without reasonable grounds." Bobby Berosini, 114 Nev.
at 1354, 971 P.2d at 387.
Here, the district court made no findings, and the record
contains no evidence, that would enable us to affirm an award of attorney
fees under this statute. The court never found that LVMPD asserted a
defense that was brought or maintained "without reasonable ground," was
intended to "harass" Anderson, or rendered the litigation "vexatious."
Indeed, it's difficult to see how those findings could have been made when
LVMPD immediately conceded part of the motion in writing in its response
and then a few weeks later conceded the rest of it at the very first hearing
on the motion. The litigation itself ended up lasting little more than a single
month and the docket consists of nothing more than Anderson's initial
motion, LVMPD's initial written opposition partly conceding the motion,
Anderson's reply brief, the oral hearing at which LVMPD conceded the
motion in its entirety, and then the proceedings surrounding Anderson's
request for attorney fees. Accordingly, the district court's award of fees
must be reversed.
The evidentiary burdens in return-of-property motions
Quite apart from whether Anderson was or was not entitled to
fees, both parties and the district court appeared confused as to how they
should have handled the underlying merits of Anderson's return-of-
property motion. Moreover, this confusion extended to the way Anderson
briefed her appeal, with Anderson arguing that fees should have been
awarded because LVMPD failed to present "credible evidence" at a time
when it never actually had any burden of production. Their confusion was
understandable considering the general language employed in NRS 179.085
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the statute or handle such motions. Consequently, we take this opportunity
to clarify the evidentiary burdens litigants bear in initiating and defending
return-of-property motions quite outside of, and apart from, any subsequent
request for attorney fees after the merits have been resolved.
NRS 179.085(1)(e) permits "[a] person aggrieved by. . . the
deprivation of property [to] move the court. . . for the return of the property
on the ground that . . . [r] etention of the property by law enforcement is not
reasonable under the totality of the circumstances." In resolving that
motion, the statute contemplates an expedited procedure with no formal
discovery mechanisms or eventual jury trial; instead, "[t]he judge shall
receive evidence on any issue of fact necessary to the decision of the motion."
NRS 179.085(1).
Here, LVMPD quickly conceded the merits of Anderson's
motion. Consequently, the district court was not required to do anything
more than grant Anderson's motion as unopposed. However, had things
been different and had LVMPD contested the motion substantively, the
district court may have been required to consider evidence to resolve the
matter. To do so, the district court would have followed a procedure well
established in federal courts.
NRS 179.085 largely mirrors Federal Rule of Criminal
Procedure 41(g), 3 and where Nevada statutes track their federal
'Fed. R. Crim. P. 41 was amended in 2002 "as part of a general
restyling of the Criminal Rules to make them more easily understood and
to make style and terminology consistent throughout the rules." United
States v. Albinson, 356 F.3d 278, 279 n.1 (3d Cir. 2004) (internal quotation
marks and citation omitted). What was formerly Fed. R. Crim. P. 41(e)
became Fed. R. Crim. P. 41(g), but the rule itself stayed largely the same.
Id.
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counterparts, federal cases interpreting the rules can be instructive. Exec.
Mgmt., Ltd. v. Ticor Title Ins. Co., 118 Nev. 46, 53, 38 P.3d 872, 876 (2002);
Middleton v. State, 114 Nev. 1089, 1107 & n.4, 968 P.2d 296, 309 & n.4
(1998) (citing a federal case interpreting Federal Rules of Criminal
Procedure that were "largely equivalent" to Nevada statutes).
Fed. R. Crim. P. 41(g) generally requires that factual disputes
in return-of-property motions be resolved through evidence, either
affidavits or other documentary evidence or, if documentary evidence is
insufficient, then by considering the testimony of witnesses during an
evidentiary hearing. See United States v. Stevens, 500 F.3d 625, 628 (7th
Cir. 2007); United States v. Albinson, 356 F.3d 278, 282 (3d Cir. 2004);
United States v. Chambers, 192 F.3d 374, 378 (3d Cir. 1999).
During the consideration of such evidence, the moving party
bears the initial burden to show that the government's retention of his or
her property is facially unreasonable under the totality of all of the
circumstances that then exist. See NRS 179.085(1)(e); In re Matter of
Search of Kitty's E., 905 F.2d 1367, 1375 (10th Cir. 1990) ("A movant must
demonstrate that retention of the property by the government is
unreasonable in order to prevail on a [Fed. R. Crim. P. 41(g)] motion.").
When the movant initially files his or her motion, he or she may have little
idea of where any criminal investigation might stand. Nevertheless, the
burden can be met in a few ways based upon information already within the
movant's possession. For example, this can occur when a criminal case has
been completely resolved, either through a trial or a guilty plea, because
such a resolution suggests that any criminal investigation is likely over. See
United States v. Gladding, 775 F.3d 1149, 1152 (9th Cir. 2014) (holding that
the burden of proof shifts to the government when "the property in question
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is no longer needed for evidentiary purposes, either because trial is
complete, the defendant has pleaded guilty, or. . . the government has
abandoned its investigation" (quoting United States v. Martinson, 809 F.2d
1364, 1369 (9th Cir. 1987))). It can also occur when no charges have been
filed even after the government has had more than enough time to conduct
its investigation. See Martinson, 809 F.2d at 1369 n.5 (recognizing that the
burden could shift to the government if it has retained property for an
extended period of time without filing charges); Mr. Lucky Messenger Serv.,
Inc. v. United States, 587 F.2d 15, 17 (7th Cir. 1978) (remanding for an
evidentiary hearing to determine whether the government could reasonably
justify retaining plaintiffs cash for over 17 months without bringing any
charges).
If the movant fails to meet this initial burden, nothing more is
required and the motion may be denied even if the government produces no
evidence in response. If, however, the district court finds that the movant
has made an initial showing that the retention of the property appears
facially unreasonable, then the burden shifts to the government to
demonstrate that it has a legitimate reason to retain the property.
Martinson, 809 F.2d at 1369. The government could meet this burden in
several ways. It could, for example, show that the property was contraband
(such as drugs) that could not be legally returned. See id. Alternatively, it
could show that the seized property was not actually owned by the movant
(such as if it had actually been stolen from someone else). See United States
v. Wright, 610 F.2d 930, 939 (D.C. Cir. 1979). It could also show that the
property was the subject of civil forfeiture proceedings, or it could show that
the property was related to an ongoing criminal investigation. See id. In
any of these cases, the government would have the burden to prove its
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allegations through something more than a naked assertion of counsel. See
Stevens, 500 F.3d at 628 ("[A]rguments in a Government brief, unsupported
by documentary evidence, are not evidence.").
If the government intends to prove that it's keeping the
property pursuant to an active criminal investigation, then things become
interesting. The types of "evidence" that could prove the existence of an
ongoing law enforcement investigation are likely to be wholly unlike the
kinds of evidence that parties typically present in other types of lawsuits.
Many law enforcement activities—especially ones that do not result in the
filing of any criminal charges—are governed by a web of rules governing
confidentiality that do not exist in other contexts, including rules that
protect the secrecy of grand jury proceedings and the identities of
confidential informants. See, e.g., Fed. R. Crim. P. 6(e); 28 C.F.R. §§ 16.21-
.29. Rules aside, the disclosure of an active and ongoing criminal
investigation may jeopardize the integrity of the investigation itself by
revealing to a suspect that he or she is being investigated, how the
investigation is being conducted, and by whom. Indeed, when a federal
grand jury has been convened to investigate a target, unauthorized
disclosure of its existence may constitute the commission of a federal crime,
even when the disclosure is made in defense of a civil action like this one.
See 18 U.S.C. § 401 (allowing a federal court to punish contempt of its
authority by fine or imprisonment, including for "disobedience or resistance
to its lawful . . . rule"). The question thus becomes how parties and district
courts can determine whether keeping seized property is justified without
either jeopardizing an active criminal investigation or running afoul of
other statutes or rules requiring that such investigations remain
confidential.
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To solve this conundrum, the district court may choose to
permit the government to supply its evidence in camera to preserve the
secrecy and integrity of any ongoing investigation, and to prevent such
motions from becoming a discovery tool through which a suspect can gather
intelligence through the back door on the progress of the government's
investigative efforts. See, e.g., Mr. Lucky Messenger Serv., 587 F.2d at 17
(remanding and directing the district court to, in its discretion, conduct the
evidentiary hearing in camera because the reasons for the government's
continued retention of property "may be integrally related to grand jury
proceedings"); In re Documents & Other Possessions at Metro. Ctr. of
Prisoner Hale, 228 F.R.D. 621, 624 (N.D. Ill. 2005) (holding that the
government could submit more information to the court "ex parte and under
seal" if it wished "Ed]ue to the sensitive nature of the case and in the event
of an ongoing investigation that [it] does not wish to disclose").
In the instant case, had LVMPD contested Anderson's motion
in a substantive way, the district court would have had to resolve the merits
of the matter by weighing evidence. But because LVMPD quickly conceded
the motion, the district court was not required to consider anything more.
From this, Anderson seems to argue that merely because LVMPD produced
no evidence and lost the motion, its defense was unreasonable and fees were
appropriate. But LVMPD had no burden to produce anything yet, and even
if it had, Anderson's assertion is far from true. Not every unsuccessful
defense is ipso facto "unreasonable," "frivolous," or "vexatious." Merely
losing a motion on the merits does not mean that the losing defense was
utterly "without reasonable ground" for purposes of awarding attorney fees.
NRS 18.010(2)(b) does not create an automatic "loser pays" system, of the
kind found in England, in which the unsuccessful party always pays fees to
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the winning party. See Hensley v. Eckerhart, 461 U.S. 424, 443 n.2 (1983)
(Brennan, J., concurring in part and dissenting in part) (noting that the
"English Rule" is one "under which the losing party, whether plaintiff or
defendant, pays the winner's fees"). Instead, whether the losing party's
defense went beyond merely unsuccessful into becoming "vexatious" and
"without reasonable ground" is a decision for the district court to make in
the first instance
Here, LVMPD conceded the motion without much of a fight, and
therefore the district court did not weigh any evidence and did not make
any findings that LVMPD did anything to trigger NRS 18.010(2)(b).
Moreover, because the district court granted Anderson's motion as
unopposed, it never had to determine whether Anderson actually met her
initial burden. Thus, the burden never shifted to LVMPD to do anything
more or supply any evidence. Even if it had, that would not necessarily
mean that fees were warranted; to award fees, the district court must have
made a separate finding that LVMPD not only lost the motion, but
unreasonably fought it based upon grounds prohibited under NRS
18.010(2)(b). No such findings exist, and therefore the award of fees must
be reversed.
CONCLUSION
For the foregoing reasons, the district court's award of attorney
fees was not proper under NRS 18.010(2)(a) and cannot be affirmed under
NRS 18.010(2)(b) in the absence of any relevant findings or any clear
evidence that LVMPD brought or maintained its defense without
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reasonable ground. Accordingly, we reverse the district court's order
awarding attorney fees.
J.
Tao
I concur:
G
,444
H
;
L ITI
J.
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SILVER, C.J., concurring:
I concur in the result only.
1/4-1(i4a)
Silver
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