Ortiz-Cameron v. Drug

• Court: Court of Appeals for the First Circuit
• Decided: March 16, 1998
• Docket: 97-1496
• Status: Published

Opinion

USCA1 Opinion

                 UNITED STATES COURT OF APPEALS

                     FOR THE FIRST CIRCUIT

                                

                      ____________________

                                

                          No. 97-1496

                                

        ARNALDO ORTIZ-CAMERON AND ERIC A. ORTIZ-CAMERON,

                    Plaintiffs - Appellants,

                                

                      ____________________

                                

                     JOSE A. LOPEZ-CACERES,

                     Plaintiff - Appellee,

                                

                               v.

                                

                DRUG ENFORCEMENT ADMINISTRATION,

                     Defendant - Appellee.

                                

                      ____________________

                                

          APPEAL FROM THE UNITED STATES DISTRICT COURT

                                

                FOR THE DISTRICT OF PUERTO RICO

                                

         [Hon. H‚ctor M. Laffitte, U.S. District Judge]

                                

                      ____________________

                                

                             Before

                                

                    Torruella, Chief Judge,

                                

                   Cyr, Senior Circuit Judge,

                                

                     Lynch, Circuit Judge.

                                

                     _____________________

                                

                  Frank D. Inserni for appellants.

    Miguel A. Fern ndez, Assistant United States Attorney, with whom

Guillermo Gil, United States Attorney, and Jacqueline D. Novas,

Assistant United States Attorney, were on brief for appellee Drug

                  Enforcement Administration.


____________________

                                

                         March 16, 1998

                      ____________________          TORRUELLA, Chief Judge.  Brothers Arnaldo Ortiz-Cameron

("Arnaldo") and Eric Ortiz-Cameron ("Eric") challenge the

district court's order dismissing their complaint against the

Drug Enforcement Administration ("DEA") which claimed an interest

in various properties seized in prior civil forfeiture

proceedings.  We find that the doctrine of res judicata bars the

brothers' action.  Accordingly, we affirm the district court's

decision.

I.  BACKGROUND Appellants Arnaldo and Eric are brothers of Luis Hiram

Ortiz-Cameron ("Luis"), a convicted drug smuggler who purchased 

several dairy farms as well as animals and farming equipment with

profits from the illegal drug trade.  On November 3, 1989, and

November 9, 1989, the government filed two separate in rem civil

forfeiture proceedings against this property.  In the first civil

forfeiture action, United States Marshals personally served Arnaldo

with the pleadings on November 4, 1989.  On that date, Eric also

was served through his brother Arnaldo.  In response, on

December 11, 1989, the brothers filed claims requesting protection

of their alleged interests in the defendant properties, and on

December 27, 1989, they filed an answer to the government's

complaint.  However, the district court judge, Jaime Pieras, Jr.,

dismissed their claims because they failed to file their claims

within the 10-day claim period and their answer within the 20-day

answer period established in Rule C(6) of the Supplemental Rules

for Certain Admiralty and Maritime Claims ("Rule C(6)").  On

appeal, this court affirmed that decision.  See United States v.

One Dairy Farm, 918 F.2d 310 (1st Cir. 1990).

          In the second civil forfeiture proceeding, U.S. Marshals

served Arnaldo and Eric with the pleadings on November 14, 1989, a

few days after the filing of the action.  Arnaldo failed to respond

within the statutory limits, filing his claim on December 11, 1989,

and his answer on December 27, 1989.  Eric never filed either a

claim or an answer.  Consequently, the district court judge before

whom this second action was filed, Chief Judge Carmen C. Cerezo,

again dismissed their claims, finding that the brothers lacked

standing to challenge the forfeiture of the properties.  Despite

these judgments against them, Arnaldo and Eric continued to pursue

their interest in the properties by filing the instant action.  On

the DEA's motion for summary judgment, the district court dismissed

their complaint.  See Ortiz Cameron v. Drug Enforcement Admin., 959

F. Supp. 92 (D.P.R. 1997).  The brothers appeal.

                         II.  DISCUSSION     We review a grant of summary judgment de novo.  SeeUnited Nat'l Ins. Co. v. Penuche's, Inc., 128 F.3d 28, 30 (1st Cir.

1997).  The government asserts that the doctrine of res judicata

bars the present action.  The res judicata doctrine entails two

different concepts--claim preclusion and issue preclusion.  In

entering summary judgment, the district court relied on claim

preclusion principles.  A claim is precluded if three requirements

are met: (1) a final judgment on the merits in an earlier action;

(2) a sufficient identity between the parties in the two suits; and

(3) a sufficient identity of the causes of action in the two suits. 

See Porn v. National Grange Mut. Ins. Co., 93 F.3d 31, 34 (1st Cir.

1996).  According to the government, final judgment in the prior

civil forfeiture proceedings precludes Arnaldo and Eric from

relitigating claims that were raised or could have been raised in

those proceedings.  Since the brothers could have raised in their 

One Dairy Farm appeal the same issues they assert here, i.e., the

inadequacy of post-seizure notice and the lack of pre-seizure

notice, the government contends that all of Arnaldo and Eric's

instant claims are precluded.

          Appellants do not dispute the presence of the second and

third elements of claim preclusion in this case.  However, they

argue that in the prior proceedings they did not have a full and

fair opportunity to have their claims adjudicated on the merits. 

In the first civil forfeiture action, Judge Pieras determined that

the brothers lacked standing to pursue their claims because they

failed to comply with the statutory deadlines.  This court affirmed

that decision.  We thus take it as established as to the first

property seized that Arnaldo and Eric had actual notice of the

seizure, see One Dairy Farm, 918 F.2d at 311, and an opportunity to

litigate their present claims.  The same is also true as to the

second seizure.  In the second civil forfeiture proceeding, Judge

Cerezo also decided that appellants lacked standing since Arnaldo

filed a late claim and Eric never responded to the government's

complaint.  Judge Cerezo also ruled that, even if Arnaldo had filed

a timely claim, his status as an unsecured creditor of Luis

precluded him from recovering under the civil forfeiture statute. 

Neither Arnaldo nor Eric appealed Judge Cerezo's ruling to this

court.

          Under these circumstances, we find the judgments in the

two prior civil forfeiture proceedings to be "on the merits."  As

this court noted in Kale v. Combined Ins. Co. of Am., 924 F.2d 1161

(1st Cir. 1991), "the dismissal of a claim as time-barred [by the

statute of limitations] constitutes a judgment on the merits,

entitled to preclusive effect."  Id. at 1164 (citing Rose v. Town

of Harwich, 778 F.2d 77, 80 (1st Cir. 1985)).

          We agree with the district court that the dismissal of

the brothers' claims is analogous to a dismissal on statute of

limitation grounds.  The purpose behind Rule C(6) is "to require

claimants to come forward as quickly as possible after the

initiation of forfeiture proceedings, so that the court may hear

all interested parties and resolve the dispute without delay."  SeeUnited States v. Various Computers and Computer Equip., 82 F.3d

582, 585 (3d Cir. 1996).  If a putative claimant who has received

proper notice fails to file within Rule C(6)'s time limits, he or

she may not bring a future claim for the properties at issue.  Cf.United States v. Real Property Located in Fresno County, __ F.3d

__, __, 1998 WL 47135, at *6 (9th Cir. Feb. 9, 1998) (Rule C(6)'s

purpose would be "ill-served if any person with an ownership

interest in a property . . .  were empowered to challenge a

forfeiture judgment long after judgment had been entered."). 

Finding that the 10-day claim period and 20-day answer period

established by Rule C(6) are analogous to a statute of limitations,

we hold that Arnaldo and Eric's claims are precluded by the

doctrine of res judicata.

          Arnaldo and Eric also argue that the district court erred

in failing to extend the discovery deadline established in its

initial scheduling order.  They allege that the additional time to

conduct discovery would have uncovered evidence that the DEA seized

their property without proper notice as well as recklessly

intermingling their properties.  However, as the district court

observed, a finding of res judicata "save[s] the parties the time

and expense of conducting unnecessary discovery."  See 959 F. Supp.

at 96.  Having decided the res judicata issue in the government's

favor, we need not address whether the district court erred in

denying appellants' request for additional discovery time.

                        III.  CONCLUSION

          For the foregoing reasons, the district court's opinion

and order is affirmed.

          Costs to be assessed against appellants.