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United States v. $113

United States District Court, E.D. Virginia, Richmond Division

October 19, 2016

UNITED STATES OF AMERICA, Plaintiff,
v.
$113, 550.58 IN FUNDS FROM JP MORGAN CHASE BANK, ACCOUNT #768982881, IN THE NAME OF LEGAL SERVICES, Defendant.

          MEMORANDUM OPINION

          Robert E. Payne Senior United States District Judge

         This matter is before the Court on the MOTION TO STRIKE CLAIMANTS FIAD SERVICES LLC, LEGAL SERVICES, AND MICHAEL COOPER'S ANSWER (ECF No. 7), filed by the United States and the MOTION FOR LEAVE TO FILE CLAIM OUT OF TIME AND TO AMEND ANSWER (ECF No. 13), filed by FIAD Services LLC, Legal Services. For the reasons set forth below, the MOTION FOR LEAVE TO FILE CLAIM OUT OF TIME AND TO AMEND ANSWER (ECF No. 13) will be granted and the MOTION TO STRIKE CLAIMANTS FIAD SERVICES LLC, LEGAL SERVICES, AND MICHAEL COOPER'S ANSWER (ECF No. 7) will be granted as to Michael Cooper's Answer and denied as moot as to FIAD Services LLC, d/b/a Legal Services.

         BACKGROUND

         On June 6, 2016, the COMPLAINT FOR FORFEITURE IN REM (ECF No. 1) (the "Complaint"), was filed by the United States against defendant $113, 550.58 in funds from JP Morgan Chase Bank, account #768982881, in the name of Legal Services (hereinafter "defendant property"), in accordance with Fed.R.Civ.P. Supplemental Rule G(2). The action is a civil, in rem proceeding to forfeit money seized as property constituting or derived from the proceeds traceable to a scheme to defraud, involving violations of mail fraud (18 U.S.C. § 1341), wire fraud (18 U.S.C. § 1343), and/or a conspiracy to commit wire fraud and mail fraud (18 U.S.C. § 1349). (ECF No. 1, Compl. ¶ 4) .

         The WARRANT AND SUMMONS FOR ARREST OF ARTICLES IN REM (ECF No. 2) (the "Warrant") was duly executed on June 10, 2016, pursuant to Rule G(3) (b) and (c) . Proof of Service of the Warrant was filed with the Clerk of Court on June 15, 2016 (ECF No. 3).

         On June 21, 2016, pursuant to Rule G(4)(b), direct notice of the civil forfeiture action (the "Notice") and a copy of the Complaint were sent by regular and certified mail-return receipts to all entities' and persons believed to have an interest in the defendant property, including: (1) Michael D. Cooper, (2) Michael D. Cooper; c/o A. Jeff Irah, Esq., counsel for Michael D. Cooper, and (3) FIAD Services, LLC; c/o Michael D. Cooper, owner FIAD Services, LLC. The Complaint, Warrant and the Notice all mention the name "LEGAL SERVICES." It appears that appellation was FIAD's "doing business name." Thus, FIAD and LEGAL SERVICES will be referred to only as FIAD. The Notice twice stated that a claim must be filed by July 26, 2016. The regular mail was never returned as undeliverable; however, the only return receipt received was from Jeff Irah, Esq.

         The Notice was also published on an official government internet site for a period of thirty days (30 days), beginning June 17, 2016, pursuant to Rule G(4)(a). The internet notice provided that, if no direct notice was received, an interested party could file a claim by August 16, 2016, pursuant to Rule G(5) (a) (ii) (B) .

         On June 26, 2016, the ANSWER TO COMPLAINT FOR FORFEITURE IN REM (ECF No. 4) was filed by FIAD, Legal Services, and Cooper, all of whom were referred to as "claimants." But, none of them filed a claim as is required by Rule G(5).

         On August 15, 2016, the United States filed the MOTION TO STRIKE CLAIMANTS FIAD SERVICES LLC, LEGAL SERVICES, AND MICHAEL COOPER'S ANSWER AND BRIEF IN SUPPORT (ECF No. 7).

         On August 29, 2016, FIAD, this time through counsel, filed the MOTION FOR LEAVE TO FILE CLAIM OUT OF TIME AND TO AMEND ANSWER (ECF No. 13) . Attached to the motion, FIAD provided a PROPOSED AMENDED ANSWER (ECF No. 14-3).

         POSITIONS OF PARTIES

         In its MOTION TO STRIKE CLAIMANTS FIAD SERVICES LLC, LEGAL SERVICES, AND MICHAEL COOPER'S ANSWER (ECF No. 7), the United States asserts that FIAD and Cooper failed to comply with the requirements of Rule G(5) because, although they filed an Answer (ECF No. 4), they did not file a claim. Thus, says the United States, neither has standing to file an Answer. And, the United States rightly contends that, because Cooper is not an attorney, he cannot, under Local Civil Rule 83(D)(3), file papers on behalf of another, specifically FIAD.

         In support of its MOTION FOR LEAVE TO FILE CLAIM OUT OF TIME AND TO AMEND ANSWER, FIAD asserts that: (1) The Answer gave notice that the defendant property is owned and claimed by FIAD; (2) Cooper made a good faith attempt to comply with Rule G as a pro se litigant; (3) FIAD's counsel has acted diligently to correct the alleged deficiencies; and (4) the United States will suffer no prejudice from excusing FIAD's procedural errors.

         In the GOVERNMENT'S REPLY TO RESPONSE IN OPPOSITION TO MOTION TO STRIKE ANSWER AND GOVERNMENT'S RESPONSE TO MOTION OF FIAD SERVICES LLC FOR LEAVE TO FILE CLAIM OUT OF TIME AND TO AMEND ANSWER (ECF No. 15), the United States agrees with FIAD's MOTION FOR LEAVE TO FILE CLAIM OUT OF TIME AND TO AMEND ANSWER ...


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