Vereda, Ltda. v. United States

271 F.3d 1367, 51 Fed. Cl. 1367, 2001 U.S. App. LEXIS 25139, 2001 WL 1486157
CourtCourt of Appeals for the Federal Circuit
DecidedNovember 26, 2001
Docket00-5099
StatusPublished
Cited by174 cases

This text of 271 F.3d 1367 (Vereda, Ltda. v. United States) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vereda, Ltda. v. United States, 271 F.3d 1367, 51 Fed. Cl. 1367, 2001 U.S. App. LEXIS 25139, 2001 WL 1486157 (Fed. Cir. 2001).

Opinion

SCHALL, Circuit Judge.

In this case we are called upon to review an order, Vereda, Ltda. v. United States, 41 Fed.Cl. 495 (1998) (“Vereda I”), vacated in-part, 46 Fed.Cl. 12 (1999) (“Vereda *1369 II ”), that has been certified for our interlocutory review by the United States Court of Federal Claims pursuant to 28 U.S.C. § 1292(d)(2). Vereda, Ltda. v. United States, 46 Fed.Cl. 569, 571 (2000) (“Vereda III”). The controlling question of law in the certified order is:

[w]hether a mortgagee may assert a viable Fifth Amendment taking claim in the United States Court of Federal Claims following the government’s in rem administrative forfeiture of the property securing the mortgage after proceedings in the United States District Court.

Vereda III, 46 Fed.Cl. at 570.

The Court of Federal Claims certified the order at the request of the United States after it denied the motion of the United States to dismiss Vereda, Ltda.’s (‘Vereda’s”) taking claim under the Fifth Amendment to the United States Constitution. 1 Vereda’s claim arose from the Drug Enforcement Administration’s (“DEA’s”) seizure and in rem administrative forfeiture of an aircraft in which Vereda had a mortgage interest. In denying the government’s motion to dismiss, the Court of Federal Claims held that our decision in Shelden v. United States, 7 F.3d 1022 (Fed.Cir.1993), allows an innocent mortgagee, which Vereda alleges it is, to assert a Fifth Amendment taking claim in the Court of Federal Claims following an administrative forfeiture of the property that is the subject of the mortgage. Vereda I, 41 Fed.Cl. at 507; Vereda II, 46 Fed.Cl. at 18-19. Following its decision, the court certified its order in Vereda I, as revised by Vereda II, for interlocutory appeal, amending the order to include the question of law that is before us for review. Vereda III, 46 Fed.Cl. at 570-71. Subsequently, in accordance with 28 U.S.C. § 1292(d)(2), we granted the government’s unopposed petition for permission to appeal the certified order. Vereda, Ltda. v. United States, 250 F.3d 759 (Fed.Cir.2000) (unpublished table decision) (“Vereda IV”).

For the reasons set forth below, we answer the certified question in the negative. Accordingly, we reverse the decision of the Court of Federal Claims denying the government’s motion to dismiss Vereda’s taking claim. The case is remanded to the Court of Federal Claims with instructions to enter judgment dismissing Vereda’s complaint.

BACKGROUND

I.

Vereda is a limited partnership. It is registered and does business in Colombia as a broker and dealer in small aircraft and aircraft parts. Vereda I, 41 Fed.Cl. at 496. In early 1993, Vereda agreed with Aeroexpreso de la Frontera (“Aeroexpreso”), another Colombian limited partnership, to locate and deliver to Aeroexpreso a twin-engine turboprop airplane. Id. In due course, Vereda engaged Export-Air Corporation (“Exporb-Air”), a company based in Miami, Florida, to locate such an airplane in the United States and to export it to Aeroexpreso. Id.

In June of 1993, Export-Air located a 1978 Rockwell Commander aircraft (the “airplane”) that was being offered for sale in North Carolina for $460,000. Id. On June 30, 1993, after obtaining Vereda’s approval, Exportr-Air entered into a contract for the purchase of the airplane. *1370 Under the contract, Export-Air was to make an initial deposit of $50,000 toward the purchase price of the airplane. Id. The balance of the purchase price was to be paid by ExporL-Air to the seller within thirty days. Export-Air asked the seller to deliver the airplane to Fort Lauderdale, Florida, on August 6, 1993. Id. Export-Air obtained permission from the Colombian government to import the airplane into Colombia. Id.

Aeroexpreso agreed to pay Vereda a total of $544,500 for the airplane. Id. Under its agreement with Vereda, Aeroexpreso was required to pay Export-Air $50,000 and Vereda $222,250 before Aeroexpreso received the airplane in Bogota, Columbia. Id. Vereda accepted a mortgage on the airplane from Aeroexpreso in order to secure payment of the remainder of the purchase price of the airplane. Id. By August 3, 1993, Vereda had paid Export-Air a total of $496,000. Id. On August 4, 1993, Export-Air paid the seller the balance owed on the purchase of the airplane. Id.

DEA seized the airplane on August 6, 1993, when it arrived in Fort Lauderdale. Id. at 496-97. The seizure was based on a warrant alleging probable cause to believe that the airplane was intended to be used to facilitate the possession and transportation of cocaine and that the airplane had been purchased with the proceeds of illegal drug transactions. Id. at 497. The warrant alleged that the ultimate purchaser and user of the airplane was not Aeroexpreso, but Avia 2000, a Colombian corporation allegedly owned by a member of the Medellin cocaine cartel. Id.

II.

Certain items that are subject to forfeiture are described in 21 U.S.C. § 881(a), which is part of the Controlled Substances Act, 21 U.S.C. §§ 801-971 (1999). 2 Relevant to this case are 21 U.S.C. §§ 881(a)(4) and 881(a)(6). They provide in pertinent part as follows:

The following shall be subject to forfeiture to the United States and no property right shall exist in them:
(4) All conveyances, including aircraft, vehicles, or vessels, which are used, or are intended for use, to transport, or in any manner facilitate the transportation, sale, receipt, possession, or concealment of [controlled substances]....
(6) All moneys, negotiable instruments, securities, or other things of value furnished or intended to be furnished by any person in exchange for a controlled substance .... in violation of this subchapter, all proceeds traceable to such an exchange, and all moneys, negotiable instruments, and securities used or intended to be used to facilitate any violation of this subchapter....

21 U.S.C.

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271 F.3d 1367, 51 Fed. Cl. 1367, 2001 U.S. App. LEXIS 25139, 2001 WL 1486157, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vereda-ltda-v-united-states-cafc-2001.