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Mercedes Benz of St. Clair Shores v. Drug Enforcement Administration

United States District Court, E.D. Michigan, Southern Division

December 17, 2019

Mercedes Benz of St. Clair Shores, Plaintiff,
Drug Enforcement Administration, the United States of America, and Maurice Haggen, Defendants.

          Anthony P. Patti Mag. Judge



         This case arises out of a dispute surrounding $47, 500.00, which Defendant the United States government seized from Plaintiff Mercedes Benz of St. Clair Shores's bank account on or about July 1, 2019. (ECF No. 8, PageID.19.) The government argues that this Court does not have jurisdiction over this case and seeks dismissal. (ECF No. 11.) Specifically, the government argues that since it commenced administrative forfeiture proceedings under the Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), 18 U.S.C. § 983, Plaintiff's only remedy for contesting the seizure is through those proceedings and not through this separate case. (Id.) Plaintiff disagrees, challenges the propriety of the seizure, and seeks the return of funds. (ECF Nos. 8, 14.)

         For the reasons set forth below, Defendant's motion to dismiss is granted and Plaintiff's motion for a hearing to quash the warrant and obtain return of the funds seized is denied.

         I. Background

         Plaintiff is a car dealership, and an individual, Maurice Haggen, [1]sought to purchase a 2014 Rolls Royce Wraith from Plaintiff. (ECF No. 8, PageID.81.) Haggen provided a $47, 500.00 down payment in cash to secure purchase of the vehicle following approval of his financing application. Then, Plaintiff purchased the vehicle from a third party for $169, 300.00. Soon after, Haggen informed Plaintiff that he no longer wanted to purchase the vehicle. He requested that Plaintiff refund the $47, 500.00 and Plaintiff refused.

         Three days later, on June 13, 2019, the government served Plaintiff with a warrant for $47, 500.00. Plaintiff refused to comply. The government then obtained a second seizure warrant on June 28, 2019, this time directed at Plaintiff's bank, Chase, for the same amount. (ECF No. 11, PageID.129.) On or around July 1, 2019, Chase froze $47, 500.00 from Plaintiff's account and sent a certified check to the Internal Revenue Service (“IRS”) for that amount.

         That same day, Plaintiff filed its complaint in this case. (ECF No. 1.) Plaintiff's complaint alleges the government's June 13, 2019 warrant violated its Fourth Amendment right against unreasonable seizure, arguing that both the innocent purchaser defense and the lienholder defense should apply. Plaintiff also alleges that the government violated the due process clause of the Fifth Amendment. The facts underlying Plaintiff's complaint center only around the June 13, 2019 warrant and do not mention the June 28, 2019 warrant.[2]

         On July 10, 2019, Plaintiff filed a notice to quash the warrant and obtain return of the funds seized, arguing that the funds obtained from Chase arising out of the June 28, 2019 warrant should be returned to Plaintiff. (ECF No. 8.)

         While Plaintiff's motion was pending with this Court, the government commenced separate administrative forfeiture proceedings under the CAFRA on July 17, 2019. (ECF No. 11-1, PageID.141-145.) CAFRA authorizes the government to seize and forfeit any property involved in a transaction or attempted transaction in violation of certain criminal statutes after obtaining a seizure warrant under Federal Rule of Criminal Procedure 41(a). 18 U.S.C. § 981(a), (b).

         On August 17, 2019, Plaintiff responded to the CAFRA notice of intent by filing an administrative claim in those proceedings. (ECF No. 11-2, PageID.146-150.). In its claim, Plaintiff raised many of the same arguments it raises in this case. (Id.) The government then took the next step in the civil forfeiture proceedings and filed an action under CAFRA on November 12, 2019, which is currently pending in the United States District Court in the Eastern District of Michigan before Judge Gershwin A. Drain. (See United States v. Currency $47, 500 from JP Morgan Chase Bank Account No. xxxxx3957, No. 19-13329 (E.D. Mich.); and see ECF No. 19-1.) Thus, there are two separate proceedings regarding the seizure of the $47, 500.00: this case and the CAFRA proceedings.

         II. Legal Standard

         “Rule 12(b)(1) motions to dismiss for lack of subject-matter jurisdiction generally come in two varieties: a facial attack or a factual attack.” Gentek Bldg. Prod., Inc. v. Sherwin-Williams Co., 491 F.3d 320, 330 (6th Cir. 2007). Relevant here, a factual attack “raises a factual controversy requiring the district court to ‘weigh the conflicting evidence to arrive at the factual predicate that subject-matter does or does not exist.'” Wayside Church v. Van Buren County, 847 F.3d 812, 817 (6th Cir. 2017) (citing Gentek Bldg. Prods., 491 F.3d at 330) (internal citations omitted).

         Defendant also moves for dismissal under Federal Rule of Civil Procedure 12(b)(6). When deciding a motion to dismiss under Rule 12(b)(6), the Court must “construe the complaint in the light most favorable to the plaintiff and accept all allegations as true.” Keys v. Humana, Inc.,684 F.3d 605, 608 (6th Cir. 2012). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A plaintiff's claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. A plausible claim need not contain ‚Äúdetailed factual ...

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