Vereda, Ltda. v. United States

46 Fed. Cl. 12, 1999 U.S. Claims LEXIS 206, 1999 WL 673063
CourtUnited States Court of Federal Claims
DecidedAugust 18, 1999
DocketNo. 96-256C
StatusPublished
Cited by3 cases

This text of 46 Fed. Cl. 12 (Vereda, Ltda. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims 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, 46 Fed. Cl. 12, 1999 U.S. Claims LEXIS 206, 1999 WL 673063 (uscfc 1999).

Opinion

Revised Order

SMITH, Chief Judge.

This case is before the court on defendant’s Motion to Reconsider the court’s opinion of August 13, 1998, granting in part and denying in part defendant’s Motion To Dismiss. That opinion concerned the Drug Enforcement Agency’s (DEA) seizure of a 1978 Rockwell Commander aircraft (hereinafter “the airplane”), and the attempts of those financially interested in that airplane to seek redress for the seizure. Two counts from Plaintiffs First Amended Complaint survived the Motion to Dismiss: Count I, alleging an Illegal Exaction; and Count II, alleging a violation of the Takings Clause.

The facts are discussed at length in the court’s original opinion in this case. See Vereda Ltda. v. United States, 41 Fed.Cl. 495 (1998). Briefly, Vereda Ltda. (Vereda), a Columbian limited partnership, was engaged by Aeroexpreso de la Frontera (Aeroexpreso), another Columbian limited partnership, to buy an airplane located in the United States from Export-Air Corp. (Export-Air). Vereda purchased the airplane, and subsequently acquired a mortgage interest in the airplane, when Aeroexpreso agreed to pay Vereda only half of the purchase price prior to the airplane’s arrival in Columbia. On August 6, 1993, the DEA seized the airplane when it was brought into the United States. The seizure warrant was based on probable cause to believe that the airplane was going to be used to facilitate the possession and transportation of cocaine, in violation of 21 U.S.C. § 881(a)(4), and probable cause that the airplane represented proceeds of illegal drug transactions, in violation of 21 U.S.C. § 881(a)(6).

On October 28, 1993, Aeroexpreso filed a claim of owner and cost bond to protest the forfeiture of the airplane. The DEA rejected it as untimely. The airplane was then administratively forfeited on November 19, 1993 under 21 U.S.C. § 881 and 19 U.S.C. §§ 1607-1609. Aeroexpreso and Vereda both filed petitions for remission of the for[14]*14feiture which were denied. Separate petitions for reconsideration were subsequently denied.

While the DEA’s decisions on the petitions for remission were pending, Aeroexpreso filed a complaint in the U.S. District Court for the Southern District of Florida seeking return of the airplane. All counts were dismissed for lack of jurisdiction by the district court in an unpublished opinion rendered on June 28, 1994. Export-Air also filed a complaint in the Southern District of Florida, seeking review on the merits of the DEA’s forfeiture decision, alleging that it received insufficient notice of the forfeiture under 19 U.S.C. § 1607(a). The district court granted summary judgment to the government, holding it lacked jurisdiction to review the DEA’s action, and that Export-Air had received statutorily and constitutionally sufficient notice.

On May 6,1996, plaintiff filed its complaint in this court. An amended complaint was filed on June 21, 1996. Defendant filed its motion to dismiss on August 5, 1996. This court issued an opinion on August 13, 1998, dismissing Count III of plaintiffs complaint, but denying defendant’s motion as to Counts I and II. The Court now vacates its opinion as to Count I, and GRANTS defendant’s motion as to Count I. For the reasons set forth below, the court denies defendant’s motion as to Count II.

DISCUSSION

I. COUNT I: DEA Seizure of the Airplane Constituted an Illegal Exaction

In our August 13, 1998 opinion, the court denied defendant’s Motion to Dismiss as to Count I because if the government provided insufficient notice to plaintiff of the seizure of the plane, and accordingly of Vereda’s mortgage interest, this Would render the seizure an illegal exaction.

The Court held that it possessed jurisdiction over plaintiffs illegal exaction claim despite a series of nonbinding Claims Court cases which suggested the Tucker Act does not grant jurisdiction over claims arising from the DEA’s authority under 21 U.S.C. § 881 (1988 & Cum. Supp. 1997). See Vereda, 41 Fed.Cl. at 498-99 (citing LaChance v. United States, 15 Cl.Ct. 127 (1988)); Noel v. United States, 16 Cl.Ct. 166 (1989); Lark v. United States, 17 Cl.Ct. 567 (1989). The court found jurisdiction based on the Federal Circuit’s holding in Aerolineas Argentinas, 77 F.3d 1564 (Fed.Cir.1996), which “concluded that the agency’s misapplication of the governing law and regulations, which imposed costs upon the plaintiff airlines, constituted an illegal exaction of moneys to meet an obligation of the government.” See Vereda, 41 Fed.Cl. at 501 (citing Aerolineas, 77 F.3d at 1578). Plaintiffs claim, alleging the violation of the Controlled Substances Act, appeared to meet this definition.

Plaintiff claimed that it did not receive timely notice of the DEA’s administrative forfeiture proceeding. Although the district court in a related proceeding found Aeroexpreso had received timely notice, and that Mr. Sole, plaintiffs attorney, was given timely notice on August 6,1993, the district court did not address the issue of whether plaintiff had actual notice. The DEA sent written notice to plaintiff on October 14, 1993, nine days after the October 5, 1993 cutoff date to contest the seizure and administrative forfeiture.

Accordingly, the question for this court was whether or not plaintiff had received sufficient notice to contest the forfeiture. The court looked to several federal appeals court decisions from outside this circuit to determine the standard for notice in forfeiture cases. See Vereda, 41 Fed.Cl. at 503-04 (citing Sarit v. DEA, 987 F.2d 10 (1st Cir.), cert. denied, 510 U.S. 888, 114 S.Ct. 241, 126 L.Ed.2d 195 (1993); Muhammed v. DEA, 92 F.3d 648, 653 (8th Cir.1996) (“required notice is clearly focused on instructing parties not yet contesting the forfeiture in court what procedures must be followed”); Aero-Medical Inc. v. United States, 23 F.3d 328, 330-31 (“[I]t was unacceptable for the DEA to rely upon notice by publication while failing to use the information it possessed from the beginning of the forfeiture process to notify plaintiff.”); United States v. Woodall, 12 F.3d 791, 794 (8th Cir.1993)).

Plaintiffs situation did not precisely fit these precedents for notice, however, because the allegation was that, despite notice [15]*15to plaintiffs attorney, plaintiff itself had not received notice.

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Related

Vereda, Ltda. v. United States
271 F.3d 1367 (Federal Circuit, 2001)
Fireman v. United States
49 Fed. Cl. 290 (Federal Claims, 2001)
Vereda, Ltda. v. United States
46 Fed. Cl. 569 (Federal Claims, 2000)

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46 Fed. Cl. 12, 1999 U.S. Claims LEXIS 206, 1999 WL 673063, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vereda-ltda-v-united-states-uscfc-1999.