United States v. Account No. XXXX6600 located at Metropolitan Commercial Bank

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 United States of America, No. CV-22-00612-PHX-DLR

10 Plaintiff, ORDER

11 v.

12 Account No. XXXX6600 located at Metropolitan Commercial Bank, et al., 13 Defendants. 14 15 16 The Government seeks to forfeit $3,374,912.96 seized from two accounts at 17 Metropolitan Commercial Bank (“MCB”) in the name of BigBen1613, LLC. The 18 Government alleges that professional money launderers use businesses like BigBen1613 19 to launder drug proceeds. (Doc. 27.) The Government filed this civil forfeiture action on 20 April 14, 2022, and the case was sealed and stayed due to the ongoing criminal 21 investigation. (Docs. 1, 8, 14, 19, 24.) On February 13, 2023, the sealing and stay orders 22 were lifted and the Government filed its First Amended Verified Complaint for Forfeiture 23 in Rem. (Docs. 25, 27.) The Government served Claimants BigBen1613 and MCB on 24 February 22, 2023. Both Claimants noticed claims and filed answers asserting innocent 25 owner defenses. (Docs. 30, 32, 35, 38.) 26 The Clerk of the Court assigned this case to the expedited track pursuant to LRCiv 27 16.2(b)(1)(A)(i). The Court therefore issued a scheduling order without a case management 28 conference on February 23, 2023, setting the deadline for completing fact discovery 6 1 months from the date both an answer and claim are filed, and the deadline for dispositive 2 motions 7 months after the same. (Doc. 31.) 3 On April 4, 2023, BigBen1613 moved for summary judgment on its innocent owner 4 defense. (Doc. 40.) Ten days later, the Government filed a motion to assign this case to the 5 standard or complex track and to schedule a case management conference. (Doc. 41.) 6 BigBen1613 opposed this motion. (Doc. 43.) 7 On May 4, 2023, the Government filed a motion pursuant to Federal Rule of Civil 8 Procedure 56(d), asking this Court to deny or defer ruling on BigBen1613’s summary 9 judgment motion until the Government has had an adequate opportunity to conduct 10 discovery into facts surrounding BigBen1613’s innocent owner defense. (Doc. 44.) 11 BigBen1613 opposes this motion. (Doc. 52.) 12 On May 30, 2023, the Court granted the Government’s motion to assign this case to 13 the standard case management track, vacated the expedited track scheduling order, and 14 scheduled a case management conference for July 6, 2023. (Doc. 62.) 15 Now, the Court considers the Government’s Rule 56(d) motion. 16 Under Rule 56(d), “[i]f a nonmovant shows by affidavit or declaration that, for 17 specified reasons, it cannot present facts essential to justify its opposition,” the Court may 18 issue any appropriate order, including deferring consideration of the motion for summary 19 judgment or denying it, or allowing “time to obtain affidavits or declarations or to take 20 discovery.” Fed R. Civ. P. 56(d). The party requesting relief under Rule 56(d) must set 21 forth in its affidavit or declaration: (1) “specific facts it hopes to elicit from further 22 discovery,” (2) that “the facts sought exist,” and (3) that “the sought-after facts are essential 23 to oppose summary judgment.” Family Home & Finance Ctr., Inc. v. Fed. Home Loan 24 Mortg. Corp., 525 F.3d 822, 827 (9th Cir. 2008) (discussing former Rule 56(f)). Rule 56(d) 25 relief should generously be granted where a summary judgment motion is filed early in the 26 litigation, “before a party has had any realistic opportunity to pursue discovery relating to 27 its theory of the case.” Burlington N. Santa Fe R.R. Co. v. Assiniboine & Sioux Tribes of 28 the Fort Peck Reservation, 323 F.3d 767, 773-74 (9th Cir. 2003). Unless the non-moving 1 party has failed to diligently pursue discovery, such relief should be granted “almost as a 2 matter of course.” Id. (quoting Wichita Falls Office Ass’n v. Banc One Corp., 978 F.2d 3 915, 919 n.4 (5th Cir. 1992)). 4 BigBen1613’s summary judgment motion—filed roughly a month after its 5 answer—was filed early in the litigation before the Government had a realistic opportunity 6 to pursue discovery related to BigBen1613’s innocent owner defense. This is one of those 7 situations in which the Court should give Rule 56(d) relief generously. What’s more, the 8 Court does not find a lack of diligence on the Government’s part. Rather, it appears the 9 parties have been actively engaged in discovery, including just recently agreeing to the 10 terms of a protective order. (Docs. 55, 58.) Accordingly, Rule 56(d) relief should be granted 11 almost as a matter of course, provided the Government has adequately supported its request 12 with an affidavit. The Government has done so. To support its Rule 56(d) motion, the 13 Government submitted an affidavit from Assistant United Sates Attorney Bruce R. Van 14 Baren detailing numerous categories of specific information it will seek in discovery, and 15 explaining how such information is relevant to BigBen1613’s innocent owner defense. 16 (Doc. 44-1.) 17 Accordingly, for cause shown, the Court will grant the Government’s Rule 56(d) 18 motion (Doc. 44) and deny BigBen1613’s motion for summary judgment (Doc. 40) without 19 prejudice to BigBen1613 renewing that motion after the parties have meaningfully engaged 20 in discovery. The Court recognizes that BigBen1613 and the Government disagree over 21 the proper scope of discovery. This is an issue the parties can raise with the Court during 22 the July 6, 2023, scheduling conference. For now, however, the Court finds that 23 BigBen1613’s summary judgment motion is premature because the parties have not had 24 adequate time to conduct fact discovery on BigBen1613’s innocent owner defense. 25 / / / 26 / / / 27 / / / 28 1 IT IS ORDERED that the Government’s Rule 56(d) motion (Doc. 44) is GRANTED and BigBen1613’s motion for summary judgment (Doc. 40) is DENIED || without prejudice to BigBen1613 renewing its motion after the parties have had an 4|| adequate opportunity to conduct discovery into BigBen1613’s innocent owner defense. 5 Dated this 31st day of May, 2023. 6 7 : Ayes le 10 Upited States Dictric Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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