[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
JULY 22, 2005
No. 04-14834
THOMAS K. KAHN
CLERK
D. C. Docket No. 04-20670-CV-JLK
FERNANDO MESA VALDERRAMA,
Plaintiff-Appellant,
versus
UNITED STATES OF AMERICA,
Defendant-Appellee.
Appeal from the United States District Court
for the Southern District of Florida
(July 22, 2005)
Before DUBINA and WILSON, Circuit Judges, and COOGLER*, District Judge.
DUBINA, Circuit Judge:
______________________
*Honorable L. Scott Coogler, United States District Judge for the Northern District of Alabama,
sitting by designation.
Appellant, Fernando Mesa Valderrama (“Mesa”), appeals the district court’s
order granting the Government’s Motion to Dismiss Mesa’s Motion to Set Aside
Administrative Forfeiture, pursuant to 18 U.S.C. § 983(e). For the reasons that
follow, we affirm.
I. BACKGROUND
A. Facts
Mesa is a resident and citizen of Bogota, Colombia. In 1990, Mesa
purchased three investment policies from Eagle Star International Life (“Eagle
Star”). Eagle Star held the policies in accounts located on the Isle of Man. Mesa
made annual contributions to the policies for over a decade, but in March 2002 he
requested a partial withdrawal of $100,000 from his accounts. Prior to this
request, Mesa had never withdrawn money from the accounts.
On or about April 18, 2002, Eagle Star informed Mesa that it would mail a
check, drawn from JP Morgan Chase Manhattan Bank, for $100,000 to its office in
Bogota, Colombia. Eagle Star shipped the check in an Airborne Express package
addressed to Jorge Santallana (“Santallana”), the Eagle Star registered agent in
Bogota, Colombia. United States Customs officials in Miami, Florida, seized the
check en route from the Isle of Man to Bogota, Colombia. According to the
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Government, Customs seized the check for an alleged violation of 18 U.S.C. §
1956, laundering of a monetary instrument.
On May 7, 2002, Mark F. Edwards (“Edwards”), an officer with the
Customs Office of Fines, Penalties, and Forfeitures, sent written notice of the
check’s seizure to Santallana. The notice identified the seized check as “one (1)
Chase Manhattan Bank for $100,000, in U.S. Dollars” that was “subject to
forfeiture under the provisions of [T]itle 18, United States Code, [S]ection 981 for
violation of [T]itle 18, United States Code, [S]ection 1956 in that the monies are
the proceeds of unlawful activity.” The notice informed Santallana that all
correspondence must include the referenced seizure case number. The notice also
detailed the legal options available in response to the seizure. Customs included
in the notice important documents, such as an “Election of Proceedings” form.
The notice instructed the recipient to check options 1 or 3 on the Election of
Proceedings Form in order to contest the agency’s forfeiture action, and it advised
the recipient that he had 35 days from the date of the letter to notify Customs of
his decision. Option 1 in the Election of Proceedings form provided:
I REQUEST THAT U.S. CUSTOMS DELAY
FORFEITURE PROCEEDINGS AND CONSIDER MY
PETITION OR OFFER ADMINISTRATIVELY. My
Petition or offer is attached herewith. By making this request I
understand that I am giving up my right for the immediate
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commencement of administrative forfeiture proceedings as
provided under 19 U.S.C. 1607 and 19 CFR Part 162. If
administrative forfeiture has begun, it will be stopped until my
petition or offer is considered. However, I understand that at
any time I can request, in writing, that U.S. Customs begin
administrative forfeiture proceedings and they will continue to
consider my petition or offer. I also understand that at any
time I can file a claim with U.S. Customs (as described in Box
3 below) and their consideration of my petition or offer will
stop and the case will be sent to the U.S. Attorney for court
action.
Option 3 provided:
I REQUEST THAT U.S. CUSTOMS SEND MY CASE
FOR COURT ACTION. Please immediately send the case to
the U.S. Attorney for court action. I have fully completed,
signed and attached a SEIZED ASSET CLAIM FORM as
required by law. I understand that if I have not fully completed
this form, U.S. Customs will treat my submission as a petition
for relief (as described in Box 1, above).
On May 31, 2002, Mesa responded to Customs’s letter, choosing option 1:
filing an administrative petition to contest the forfeiture. On June 10, 2002, Mesa
filed his administrative petition, in which he claimed that the funds in the accounts
were not the proceeds of unlawful activity and requested the return of his check.
Following a Customs’s investigation, in April 2003, Special Agent Daniel Flores
(“Agent Flores”) of the Department of Homeland Security, Immigration and
Customs Enforcement (“ICE”) contacted Mesa. After some correspondence and
conversation, including at least one in-person meeting, Mesa and Agent Flores
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agreed to a settlement whereby Mesa would waive his claim to $40,000 and the
Government would return $60,000.1 Agent Flores informed Mesa that he would
prepare the settlement agreement and send it to Mesa.
On June 30, 2003, United States Customs and Border Protection (“CBP”)
sent Mesa a letter denying his request for administrative relief from forfeiture. At
this time Mesa had not received a written settlement agreement from Agent Flores.
The denial letter informed Mesa that administrative forfeiture proceedings would
be initiated thirty days from the date of the letter. Mesa claims that he disregarded
this letter because of his settlement agreement with Agent Flores. In August 2003,
CBP sent Mesa another letter informing him that CBP would soon initiate
summary forfeiture proceedings regarding Mesa’s check. However, the letter also
advised Mesa that within 20 days from the time CBP first published notice of the
proceedings, Mesa could elect to have the matter referred to federal court for
judicial forfeiture proceedings. Again, Mesa disregarded the letter. Beginning on
August 14, 2003, the Notice of Seizure and Intent to Forfeit the check was
published in the Miami Daily Business Review for three successive weeks. On
1
The Government denies that the parties finalized a settlement agreement. According to the
Government, Agent Flores informed Mesa that the settlement agreement could not be finalized
without Agent Flores’s supervisor’s approval. Agent Flores subsequently learned he did not have
authority to settle.
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September 3, 2003, the check was summarily forfeited and a declaration of
forfeiture against the check was issued the following day. After learning Mesa
had obtained new counsel and receiving a request on Mesa’s behalf to reinstate the
case and refer it to the United States Attorney for judicial forfeiture proceedings,
on September 18, 2003, Customs sent Mesa’s attorney correspondence detailing
the foregoing forfeiture proceedings and explaining that there was no basis to
reinstate the case.
Although Customs had forfeited Mesa’s check, he believed that Customs
would be unable to redeem the check because he had not endorsed it. Therefore,
Mesa contacted Eagle Star and requested a new check. On or about November 25,
2003, however, Eagle Star informed Mesa by letter that pursuant to instructions
received from Customs, Eagle Star could not issue a new check.
B. Procedural History
On March 22, 2004, more than six months after learning that Customs had
administratively forfeited his check, Mesa filed a Motion to Set Aside
Administrative Forfeiture, pursuant to 18 U.S.C. § 983(e) and 28 U.S.C. § 1331, in
district court. In support of his motion, Mesa argued that:
1. The non-negotiable check was not subject to administrative
forfeiture proceedings as a matter of law;
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2. Customs’s warrantless seizure of the check violated the Fourth
Amendment and applicable statutory authority;
3. Customs’s warrantless constructive seizure of the Accounts
violated the Fourth Amendment and applicable statutory authority;
4. Customs failed to serve the statutorily mandated notice that it had
seized the Accounts thereby violating the Fifth Amendment and
rendering the forfeiture void ab initio;
5. Customs failed to serve the statutorily mandated notice that it had
commenced summary administrative forfeiture proceedings, thereby
violating the Fifth Amendment and rendering the forfeiture void ab
initio.
The Government filed a Motion to Dismiss, arguing that the court lacked subject
matter jurisdiction to address Mesa’s first three arguments because a claimant may
only raise procedural due process claims concerning an administrative forfeiture.
The Government further alleged that Mesa’s fourth argument was subject to
dismissal because Mesa received constructive notice of the constructive seizure of
his accounts. The Government also claimed that it complied with all notice
requirements regarding the administrative forfeiture of Mesa’s check, thus
negating Mesa’s fifth argument. Lastly, the Government urged the district court
7
not to exercise its equitable jurisdiction to consider the case because Customs did
not seize the check in callous disregard of Mesa’s constitutional rights, and Mesa
had an adequate remedy at law that he elected not to employ.
Mesa filed a motion in opposition to the Government’s Motion to Dismiss,
claiming that judicial forfeiture was the only option for forfeiting the check
because the unendorsed check was not a monetary instrument. Mesa also argued
that Customs had constructively seized his funds, and he challenged Customs’s
conclusion that the funds tied to the check were connected to illegal transactions
for the exchange of United States currency for Colombian pesos.
After the government replied and Mesa filed a sur-reply, the district court
issued a final order granting the Government’s Motion to Dismiss. Valderrama v.
United States, 326 F. Supp. 2d 1333, 1339 (S.D. Fla. 2004). The district court
concluded that it lacked subject matter jurisdiction over Mesa’s challenges to the
legitimacy of the administrative forfeiture proceeding and the Government’s
alleged warrantless seizure of his property. Furthermore, the district court found
that Mesa could not contest the agency’s administrative forfeiture declaration
because he had received adequate notice, but had failed to timely file a claim
requesting initiation of a judicial forfeiture proceeding. As for Mesa’s
constructive seizure claim regarding the account from which the seized check was
8
drawn, the court found that even assuming Customs had constructively seized the
account, it had done so only to protect its ability to redeem the seized check, and
because the check had been forfeited, constructive seizure was no longer
necessary. Mesa timely appeals the district court’s order.
II. ISSUE
Whether the district court properly concluded that it lacked subject matter
jurisdiction and equitable jurisdiction to review Mesa’s challenges to the
legitimacy of the administrative forfeiture proceeding.
III. STANDARDS OF REVIEW
This court reviews de novo a district court’s order of dismissal, accepting
the allegations in the complaint as true and construing them in the light most
favorable to the plaintiff. Swann v. So. Health Partners, Inc., 388 F.3d 834, 836
(11th Cir. 2004). This court lacks jurisdiction to review the merits of
administrative or nonjudicial forfeiture decisions, but does have jurisdiction over
claims seeking review of the adjudicatory process itself. See Arango v. U.S. Dep’t
of the Treasury, 115 F.3d 922, 925 (11th Cir. 1997). The subject matter
jurisdiction of the district court is a legal question that this court reviews de novo.
Fogade v. ENB Revocable Trust, 263 F.3d 1274, 1285 (11th Cir. 2001). Finally,
this court reviews de novo a district court’s determination of whether to exercise
9
its equitable jurisdiction, as this too is purely a legal question. United States v.
Martinez, 241 F.3d 1329, 1330 (11th Cir. 2001).
IV. DISCUSSION
In April 2000, Congress enacted the Civil Asset Forfeiture Reform Act of
2000 (“CAFRA”), Pub. L. No. 106-185, 114 Stat. 202, codified in part at 18
U.S.C. § 983, which overhauled procedures for most federal civil and nonjudicial
forfeiture actions initiated after August 23, 2000, including those brought against
property subject to forfeiture under 18 U.S.C. § 981. Customs initiated the
forfeiture in this case after August 23, 2000, the date on which CAFRA became
effective; hence, CAFRA governs. CAFRA sets forth the exclusive remedy for
seeking to set aside a declaration of forfeiture under a civil forfeiture statute. 18
U.S.C. § 983(e)(5) (“A motion filed under this subsection shall be the exclusive
remedy for seeking to set aside a declaration of forfeiture under a civil forfeiture
statute.”). Thus, a party seeking to challenge a nonjudicial forfeiture that falls
within CAFRA’s purview is limited to doing so under 18 U.S.C. § 983(e). Section
983 provides:
(1) Any person entitled to written notice in any nonjudicial civil
forfeiture proceeding under a civil forfeiture statute who does not
receive such notice may file a motion to set aside a declaration of
forfeiture with respect to that person’s interest in the property, which
motion shall be granted if –
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(A) the Government knew, or reasonably should have
known, of the moving party’s interest and failed to take
reasonable steps to provide such party with notice; and
(B) the moving party did not know or have reason to
know of the seizure within sufficient time to file a timely
claim.
18 U.S.C. § 983(e)(1)(A).
A. The district court properly concluded that the court lacks subject matter
jurisdiction
Mesa contends that he is not challenging Customs’s forfeiture decision on
the merits. Instead, he asserts two reasons why the district court erred when it
found that it did not have jurisdiction to entertain his Motion to Set Aside
Forfeiture. First, according to Mesa, Customs’s summary forfeiture of the check
was unlawful because a non-endorsed check is not a monetary instrument or any
other kind of property that may be summarily forfeited in an administrative
forfeiture under 19 U.S.C. § 1607.2 Mesa asserts that the district court has federal
2
Pursuant to 19 U.S.C. § 1607(a)(4), if
such seized merchandise is any monetary instrument within the meaning of section
5312(a)(3) of Title 31; the appropriate customs officer shall cause a notice of the
seizure of such articles and the intention to forfeit and sell or otherwise dispose of the
same according to law to be published for at least three successive weeks in such
manner as the Secretary of the Treasury may direct. Written notice of seizure
together with information on the applicable procedures shall be sent to each party
who appears to have an interest in the seized article.
“Monetary instruments” pursuant to 31 U.S.C. § 5312(a)(3)(C) includes “checks, drafts, notes,
money orders, and other similar instruments which are drawn on or by a foreign financial institution
and are not in bearer form.”
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question jurisdiction as well as equitable jurisdiction to consider this issue
pursuant to 5 U.S.C. § 706(2), authorizing reviewing courts to hold unlawful and
set aside agency action that is contrary to the law or in excess of statutory
jurisdiction, authority, or limitations. Second, Mesa contends that the funds in his
Eagle Star account should not have been forfeited because Customs never
provided him with the statutorily required written notice that the funds were
seized, nor did it make any reference to said funds when it published its intent to
summarily forfeit Mesa’s check.
The Government responds that the district court properly dismissed Mesa’s
Motion to Set Aside Forfeiture because it did not have jurisdiction to consider
Mesa’s challenges to the merits of the forfeiture action in the context of a motion
to set aside the administrative forfeiture action. If Mesa had wanted to challenge
the validity of the agency’s seizure and forfeiture of the check, the Government
contends he was required to file a claim and request the initiation of a civil judicial
forfeiture proceeding. Moreover, the Government notes that 18 U.S.C. § 983(e) is
the exclusive remedy available to persons challenging nonjudicial forfeiture
actions providing relief only in instances where the injured party did not receive
adequate notice to challenge the proceeding and the record shows Mesa received
notice in sufficient time to challenge the proceeding and acknowledges receiving
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such notice. Therefore, the Government argues, Mesa is not entitled to relief. We
agree with the Government.
Section 983(e) is “the exclusive remedy for seeking to set aside a
declaration of forfeiture under a civil forfeiture statute.” 18 U.S.C. § 983(e)(5).
This court has determined that it lacks jurisdiction to review the merits of
administrative or nonjudicial forfeiture determinations. See Arango, 115 F.3d at
925. Instead, the court’s review “is limited to determining whether the agency
followed the proper procedural safeguards” in forfeiting Mesa’s check. See
Scarabin v. Drug Enforcement Admin., 919 F.2d 337, 338 (5th Cir. 1990) (noting
that review of administrative forfeiture is limited to review of the procedure); see,
e.g., United States v. McGlory, 202 F.3d 664, 670 (3d Cir. 2000); Boero v. Drug
Enforcement Admin., 111 F.3d 301, 304-05 (2d Cir. 1997); United States v.
Deninno, 103 F.3d 82, 84 (10th Cir. 1996); United States v. Giraldo, 45 F.3d 509,
511 (1st Cir. 1995); cf. In re Matter of $67,470.00, 901 F.2d 1540, 1545 (11th Cir.
1990) (holding that equitable jurisdiction may be appropriate if the claimant’s
“failure to properly seek legal relief resulted from errors of procedure and form or
the government’s own misconduct”). Thus, the district court correctly determined
that it did not have jurisdiction to consider Mesa’s challenges to the merits of
Customs’s forfeiture of the check.
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This court will not consider Mesa’s argument that Customs lacked authority
to administratively forfeit the unendorsed check because it did not qualify as a
monetary instrument under 19 U.S.C. § 1607: this is not a challenge to the process
of forfeiture; rather, it is a challenge to the merits. Section 983(e) provides his
exclusive remedy to challenge the administrative forfeiture. The only issue this
court can consider is whether Mesa received the appropriate notice in sufficient
time to contest the agency’s action of summarily forfeiting the check. And, the
record clearly demonstrates that Mesa received the appropriate notice of the
seizure and the summary forfeiture actions taken by Customs.
Furthermore, individuals whose property interests are at stake due to
government actions are entitled to notice of the proceedings and an opportunity to
be heard. See Dusenbery v. United States, 534 U.S. 161, 167-68, 122 S. Ct. 694,
699-700 (2002). The notice necessary to satisfy due process requires only that
interested persons be given “notice reasonably calculated, under all the
circumstances, to apprise interested parties of the pendency of the action and
afford them an opportunity to present their objections.” Mullane v. Central
Hanover Bank & Trust Co., 339 U.S. 306, 314, 70 S. Ct. 652, 657 (1950).
Reasonable notice, however, requires only that the government attempt to provide
actual notice; it does not require that the government demonstrate that it was
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successful in providing actual notice. Dusenbery, 534 U.S. at 170, 122 S. Ct. at
701. Here, the Government’s notice was reasonable and comported with statutory
and due process requirements.3
B. Equitable jurisdiction
Mesa also challenges the district court’s failure to invoke its equitable
jurisdiction to consider his claims. “The [court’s] decision to invoke equitable
jurisdiction is highly discretionary and must be exercised with caution and
restraint.” In re Matter of $67,470.00, 901 F.2d at 1544. “Such jurisdiction,
therefore, is only appropriate in exceptional cases where equity demands
intervention.” Id. The court is guided by several considerations in deciding
whether to exercise equitable jurisdiction: “(1) whether the government agents
seized the property in callous disregard for the constitutional rights of the
petitioner; (2) whether the petitioner has an individual interest in and need for the
material he seeks to have returned; (3) whether the petitioner would be irreparably
injured by denial of the return of the property; and (4) whether the petitioner has
an adequate remedy at law.” Id. at 1545 (quotation omitted).
3
As for Mesa’s arguments regarding the Administrative Procedures Act, he failed to raise
this challenge in the district court. Consequently, absent a showing of plain error, of which this court
finds none, the court will not consider this challenge. See United States v. Pease, 240 F.3d 938, 943-
44 (11th Cir. 2001).
15
The district court did not err in refusing to exercise its equitable jurisdiction
in this case. Mesa received all the required notice in this case in sufficient time to
challenge the forfeiture proceeding. “It is inappropriate for a court to exercise
equitable jurisdiction to review the merits of a forfeiture matter when the
petitioner elected to forego the procedures for pursuing an adequate remedy at
law.” Id. at 1545. Consequently, because the Customs’s forfeiture proceeding
provided a sufficient legal basis to contest forfeiture of the check, Mesa is not
entitled to equitable relief. See United States v. Eubanks, 169 F.3d 672, 673-74
(11th Cir. 1999); In re Matter of $67,470.00, 901 F.2d at 1545 (“Although such
jurisdiction might be appropriate when a petitioner’s failure to properly seek legal
relief resulted from errors of procedure and form or the government’s own
misconduct, it cannot be used to enable a petitioner to rescind his own choice as to
which avenue of relief to pursue.”).4
C. Constructive seizure of the account
4
Furthermore, as the Government notes, assuming arguendo that some other vehicle provided
jurisdiction to the court, Mesa still would not be entitled to relief. Mesa’s principal argument is that
Customs exceeded its authority in initiating a nonjudicial forfeiture proceeding and ultimately
forfeiting the check. According to Mesa, Customs’s authority is limited by 19 U.S.C. § 1607 as to
the types of property that it can forfeit administratively. Mesa’s argument ignores the fact that
Customs brought the forfeiture action in his case pursuant to 18 U.S.C. § 981. Customs was not
confined to administratively forfeiting only the types of property identified in 19 U.S.C. § 1607 when
it seized the unendorsed check under 18 U.S.C. § 981, based on violations of 18 U.S.C. § 1956.
16
The district court correctly determined that the Government constructively
seized the accounts only to protect its ability to redeem the seized check. Thus,
the district court properly entered an order stating that the accounts are no longer
seized. The court’s order specifically provides that “the Government shall
promptly notify Eagle Star International Life that any remaining assets in
Plaintiff’s accounts are no longer subject to constructive seizure.” Any challenge
Mesa makes regarding the constructive seizure of his accounts is now moot.
V. CONCLUSION
For the foregoing reasons, we affirm the district court’s order granting the
Government’s Motion to Dismiss.
AFFIRMED.
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