The opinion of the court was delivered by: WOLIN
This is a civil action instituted by the United States of America to condemn and forfeit $ 116,000 in United States currency alleged to have been used in furtherance of an illegal gambling business in violation of 18 U.S.C. § 1955.
Before the Court is claimant Robert Spagnola's motion for summary judgment or in the alternative for dismissal of the complaint as barred by the Statute of Limitations. For the reasons set forth herein, the motion will be granted.
On September 23, 1983 federal officers acting pursuant to a search warrant entered the premises at 163 Sunrise Parkway, Mountainside, New Jersey. During the search the agents seized, among other items, $ 116,000 in United States currency.
On August 19, 1985, a grand jury for this district returned an indictment charging Robert Spagnola and twenty-six others with having conducted an illegal gambling business in violation of 18 U.S.C. § 1955. Trial of the gambling charges commenced in the fall of 1986. ( United States v. Accetturo et al., 623 F. Supp. 746 (D.N.J. 1985)). On August 26, 1988, a jury acquitted the 20 defendants who completed trial.
Within four days of his acquittal, claimant Spagnola filed a motion under Rule 41(e) of the Federal Rules of Criminal Procedure requesting return of the $ 116,000. The government opposed his motion claiming that tax assessment and forfeiture proceedings were contemplated. On December 6, 1988, the government filed the instant forfeiture action and on December 12, 1988, the District Court denied claimant's motion for return of the property.
The claimant has now filed a motion to dismiss and/or for summary judgment arguing that the government's forfeiture action is barred under 19 U.S.C. § 1621 because the government was required to file the instant action within five years of seizure of the property.
The government opposes the motion arguing that under the "discovery rule" inherent in section 1621, the government filed its claim for forfeiture less than five years after "discovery" of the alleged gambling offense. The government also claims that since there is a material dispute as to when the government discovered the offense, the case at bar is not ripe for summary judgment.
The statutory background of this case is straightforward. Section 1955(d) of Title 18, United States Code, provides in pertinent part:
Any property, including money used in violation of the provisions of this section may be seized and forfeited to the United States.
This provision for forfeiture incorporates by reference the procedures for forfeiture under the customs laws codified at 19 U.S.C. §§ 1604-1624 (1982 & Supp. V 1987). The two sections of Title 19 relevant to the case at bar provide, in pertinent part:
Section 1615. Burden of proof in forfeiture proceedings
In all suits or actions . . . brought for the forfeiture of any [property] . . . where the property is claimed by any person, the burden of proof shall lie upon such claimant . . . provided, that probable cause shall be first ...