120 F.

3d 472

Maria Jimena IBARRA, Plaintiff-Appellant,

v.
UNITED STATES of America; Unknown Government
Officers,
Defendants-Appellees.
No. 96-1458.

United States Court of Appeals,

Fourth Circuit.
Argued Jan. 28, 1997.
Decided July 30, 1997.
1

ARGUED: Fred Parker Bingham, II, Miami Beach, FL, for Appellant. Richard
Charles Kay, Assistant United States Attorney, Baltimore, MD, for Appellees.
ON BRIEF: Peter S. Herrick, Miami, FL, for Appellant. Lynne A. Battaglia,
United States Attorney, Baltimore, MD, for Appellees.

Before WILKINSON, Chief Judge, MICHAEL, Circuit Judge, and HILTON,

United States District Judge for the Eastern District of Virginia, sitting by
designation.

Affirmed by published opinion. Judge HILTON wrote the opinion, in which

Chief Judge WILKINSON and Judge MICHAEL joined.

OPINION
HILTON, District Judge:
4

This case comes before the Court on plaintiff-appellant's appeal of the district
court's order dismissing her case for failure to state a claim upon which relief
can be granted and lack of subject matter jurisdiction. For the reasons that
follow, we affirm.

I.
5

On June 7, 1994 plaintiff-appellant Maria Jimena Ibarra ("Ibarra") was stopped

by agents of the Drug Enforcement Administration ("DEA") in BaltimoreWashington Airport while en route to Miami. The agents were accompanied by
a drug-sniffing dog which detected trace amounts of narcotics on the
$153,279.00 in currency that Ibarra was carrying. After interrogating her
through the use of a Spanish language interpreter, the agents seized the
currency on the basis that it was used in or acquired as the result of a drugrelated offense. No drugs or drug paraphernalia were discovered on Ibarra and
she was never charged with a crime in connection with her possession of the
currency.
6

An administrative forfeiture action1 was initiated by the DEA on June 27, 1994.
Ibarra was served with a copy of the notice of the seizure and forfeiture in
conformity with 19 U.S.C.A. 1607(a)2 and 21 C.F.R. 1316.75 on July 2,
1994. The notice included information regarding how and when to file a claim
to contest the forfeiture and how and when to file a petition to request remission
or mitigation of the forfeiture. After receiving the notice, Ibarra sent several
letters to the DEA concerning the forfeiture. She filed a "petition for relief"
with the DEA on October 28, 1994. Her petition included a claim of ownership
and declaration in support of her request to proceed in forma pauperis.3 The
DEA denied the petition on March 22, 1995. Ibarra requested reconsideration
of the denial on May 4, 1995. On May 24, 1995 the DEA acknowledged receipt
of the petition for reconsideration and advised that it may take up to 120 days
to review the petition. As of the date of oral argument, Ibarra's request for
reconsideration was still pending before the DEA.

While she was pursuing an administrative claim with the DEA, Ibarra filed a
motion for return of seized property pursuant to Rule 41(e), Fed.R.Crim.P., in
the United States District Court for the Southern District of Florida. The court
denied her motion on March 13, 1995. On February 20, 1996, Ibarra
commenced this action in the United States District Court for the District of
Maryland seeking the return of her property. Her complaint alleged that the
DEA lacked probable cause for the seizure and forfeiture; the DEA unlawfully
failed to refer her case to the United States Attorney for the institution of
judicial forfeiture proceedings; the DEA violated her due process rights by
unconstitutionally delaying the return of her property; and the DEA violated her
due process rights by providing her an English language notice of the seizure.
The Government responded by moving to dismiss the complaint for lack of
subject matter jurisdiction. Specifically, the Government argued that Ibarra
failed to exhaust the administrative remedies for recovering her seized property.
On April 13, 1996, the district court granted the Government's motion to
dismiss for lack of subject matter jurisdiction and also found that plaintiff had
failed to state a claim upon which relief could be granted.

II.
8

We review de novo the district court's dismissal of the complaint. Ahmed v.

United States, 30 F.3d 514, 516 (4th Cir.1994); Schatz v. Rosenberg, 943 F.2d
485, 489 (4th Cir.1991), cert. denied sub nom., Schatz v. Weinberg and Green,
503 U.S. 936, 112 S.Ct. 1475, 117 L.Ed.2d 619 (1992). Regarding dismissal
under Rule 12(b)(6), we accept the well-pled allegations of the complaint as
true, and we construe the facts and reasonable inferences derived therefrom in
the light most favorable to the plaintiff. Little v. Federal Bureau of
Investigation, 1 F.3d 255, 256 (4th Cir.1993).

District courts clearly have original jurisdiction of any challenge to a seizure

pursuant to federal law not within admiralty and maritime jurisdiction, except
matters within the jurisdiction of the Court of International Trade under 28
U.S.C.A. 1582. 28 U.S.C.A. 1356. Additionally, district courts have
original jurisdiction of any subsequent forfeiture. 28 U.S.C.A. 1355.
However, the Customs Laws of the United States, 19 U.S.C.A. 1602-1618,
limit the jurisdiction of the district courts over forfeitures to certain categories
of property. The relevant category in the instant case is $500,000 or less in
United States currency. 19 U.S.C.A. 1607(a)(4).

10

The Customs Laws also set forth procedures for the institution and
maintenance of administrative forfeiture proceedings. To commence
administrative forfeiture proceedings, the seizing agency must publish notice of
the seizure and its intent to forfeit the property once a week for at least three
consecutive weeks in a newspaper in general circulation in the district in which
the forfeiture proceeding is initiated. 19 U.S.C.A. 1607(a); 21 C.F.R.
1316.75. The seizing agency must also give personal written notice of the
seizure and information on the applicable procedures to any party who appears
to have an interest in the seized property. Id. An individual claiming an interest
in seized property that is subject to forfeiture has two options. First, at any time
within twenty days of the date of the first publication of the notice of seizure,
he may file a claim stating his interest in the seized property and file a cost
bond in the amount specified in the statute or request a waiver of the bond
requirement to proceed in forma pauperis. 19 U.S.C.A. 1608; 21 C.F.R.
1316.76. Once the seizing agency commences forfeiture proceedings pursuant
to 19 U.S.C.A. 1607, the seizing agency divests the district court of
jurisdiction of the forfeiture proceedings and the court remains without
jurisdiction unless an interested party timely files a claim and cost bond
pursuant to 19 U.S.C.A. 1608. By timely filing a claim and cost bond or
request to proceed in forma pauperis, a claimant effectively halts the
administrative proceedings by compelling the seizing agency to refer the matter

to the United States Attorney for the district in which the seizure occurred for
the institution of judicial forfeiture proceedings. 19 U.S.C.A. 1608; 21 C.F.R.
1316.76. If a claimant fails to file timely, the DEA shall declare the property
forfeited and such declaration shall have the same force and effect as a final
decree and order of forfeiture in a judicial forfeiture proceeding in the district
court. 19 U.S.C.A. 1609(a), (b); 21 C.F.R. 1316.77(a). A declaration of
forfeiture results in title to the property vesting in the United States free and
clear of any liens or encumbrances. Linarez v. United States Dep't of Justice, 2
F.3d 208, 210 (7th Cir.1993), reh'g denied, (Sept. 2, 1993) (citing 19 U.S.C.A.
1609(b) and 21 C.F.R. 1316.77). Thus, failing to claim timely one's interest
in the seized property results in the administrative forfeiture process continuing
without judicial intervention.4
11

Second, a claimant may elect to file a petition for remission or mitigation of the
forfeiture. 19 U.S.C.A. 1618; 21 C.F.R. 1316.79. A petition for remission or
mitigation "does not serve to contest the forfeiture, but rather is a request for an
executive pardon of the property based on the petitioner's innocence...." United
States v. Vega, 72 F.3d 507, 514 (7th Cir.1995) (quoting United States v. Ruth,
65 F.3d 599, 604 n. 2 (7th Cir.1995)), cert denied., --- U.S. ----, 116 S.Ct. 2529,
135 L.Ed.2d 1053 (1996). Indeed, "under remission/mitigation procedures,
forfeitability is presumed and the petitioner seeks relief from forfeiture on
fairness grounds." United States v. German, 76 F.3d 315 (10th Cir.1996)
(quoting Orallo v. United States, 887 F.Supp. 1367, 1370 (D.Haw.1995)). To
be considered seasonably filed, a petition for remission or mitigation should be
filed within thirty days of the receipt of the notice of seizure. 21 C.F.R.
1316.80. If a petition is not received within thirty days of the notice of the
seizure, the property will either be placed in official service or sold as soon as it
is forfeited. Id.

12

Other courts have held that by initiating administrative forfeiture proceedings

pursuant to 19 U.S.C.A. 1607, the seizing agency divests the district court of
jurisdiction over the forfeiture proceedings. For example, in Linarez, supra,
state law enforcement officers seized currency from plaintiff on the basis that it
had been used or acquired to facilitate a drug-related offense. Plaintiff was
never charged with a crime but the currency was transferred to the DEA for the
institution of federal forfeiture proceedings. Plaintiff received the statutorily
mandated notice of seizure and forfeiture proceedings as well as instructions on
administrative procedures for contesting the seizure and forfeiture and filing a
petition for remission or mitigation. Despite having received proper notice,
plaintiff failed to contest the seizure or forfeiture administratively.
Subsequently, plaintiff filed a complaint in district court seeking the return of
his property and challenging the seizure and forfeiture. The court dismissed the

complaint for lack of subject matter jurisdiction. On appeal, the Seventh Circuit
affirmed. The court noted that plaintiff could have challenged the seizure and
forfeiture in the administrative proceeding or timely filed a claim and cost bond
to compel the DEA to institute judicial forfeiture proceedings. As a result of
plaintiff's failure to avail himself of these options, the district court remained
without jurisdiction. See also United States v. One Jeep Wrangler, 972 F.2d
472, 479 (2d Cir.1992) (once the administrative proceeding had begun, the
district court loses subject matter jurisdiction to adjudicate claims regarding the
seizure); United States v. Price, 914 F.2d 1507, 1511 (D.C.Cir.1990) (after the
Government initiates an administrative forfeiture proceeding and the property is
not the subject of an ongoing criminal proceeding, the district court has no
jurisdiction to resolve claims for the return of seized property); United States v.
Hernandez, 911 F.2d 981, 983 (5th Cir.1990) (affirming dismissal for lack of
subject matter jurisdiction because due process claims regarding the seizure are
properly litigated during the forfeiture proceeding); United States v. Castro,
883 F.2d 1018, 1019-20 (11th Cir.1989) (adopting district court's ruling that the
district court was without jurisdiction to consider Rule 41(e) motion for return
of property following civil forfeiture proceeding); United States v. $83,310.78
in United States Currency, 851 F.2d 1231, 1235 (9th Cir.1988) (when civil
forfeiture proceeding is pend ing, claimant may not seek equitable remedy in
district court); In re Harper, 835 F.2d 1273, 1274-75 (8th Cir.1988) (legality of
seizure should be tested in forfeiture proceeding); Matthews v. United States,
917 F.Supp. 1090, 1097-1101 (E.D.Va.1996) (district court is divested of
jurisdiction to consider Rule 41(e) petitions for return of property where agency
initiates forfeiture proceedings pursuant to 19 U.S.C.A. 1607).
13

Based on the clear mandate of the statutory scheme, we conclude, as have other
circuits facing the issue, that once the Government initiates forfeiture
proceedings, the district court is divested of jurisdiction. The court remains
without jurisdiction during the pendency of the proceeding unless the claimant
timely files a claim and cost bond or request to proceed in forma pauperis.

III.
14

Ibarra elected to participate in the administrative forfeiture proceeding. Her

petition for reconsideration was pending when this action was commenced. As
a result, she must await the outcome of the administrative process that she has
invoked. For these reasons, it is clear that Ibarra failed to state a claim upon
which relief can be granted and the district court did not have jurisdiction to
consider her claims.

15

AFFIRMED.

The currency is forfeitable pursuant to 21 U.S.C.A. 881(a)(6) (West 1996)

Subsection 881(d) of Title 21 provides that the customs laws, 19 U.S.C.A.

1602-1618, are applicable to the seizure and forfeiture of property pursuant to
that subsection

The DEA appears to have considered Ibarra's untimely filing to contest the
forfeiture as a petition for remission or mitigation, even though when
considered as such, her petition was untimely under 21 C.F.R. 1316.80(a)
(West 1996)

A number of circuits have noted that once the administrative forfeiture is

completed, district courts retain jurisdiction to review the forfeiture to
determine compliance with due process or procedural requirements. See United
States v. Schinnell, 80 F.3d 1064, 1069 (5th Cir.1996); United States v.
Giraldo, 45 F.3d 509, 511 (1st Cir.1995); United States v. Clagett, 3 F.3d 1355,
1356-57 (9th Cir.1993); United States v. Woodall, 12 F.3d 791, 793 (8th
Cir.1993); Linarez v. United States Dep't of Justice, 2 F.3d 208, 213 (7th
Cir.1993); Frazee v. Internal Revenue Service, 947 F.2d 448, 449-50 (10th
Cir.1991); Onwubiko v. United States, 969 F.2d 1392, 1398-99 (2d Cir.1992).
However, since the administrative proceeding is still pending, the district
court's jurisdiction to review due process and procedural aspects of the
forfeiture is not implicated in the instant case