Gerardo Serrano v. U.S. Customs and Border ( 2020 )

Case: 18-50977 Document: 00515566402 Page: 1 Date Filed: 09/16/2020
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
September 16, 2020
No. 18-50977 Lyle W. Cayce
Clerk
Gerardo Serrano,
Plaintiff—Appellant,
versus
Customs and Border Patrol, U.S. Customs and Border
Protection; United States of America; John Doe 1-X;
Juan Espinoza; Kevin McAleenan,
Defendants—Appellees.
Appeal from the United States District Court
for the Western District of Texas
USDC No. 2:17-CV-48
Before Clement, Higginson, and Engelhardt, Circuit Judges.
Per Curiam:
Gerardo Serrano filed suit against the United States Customs and
Border Protection (CBP) and related parties, alleging constitutional
violations after his truck and its contents were seized at the United States-
Mexico border. Serrano sought the return of his property pursuant to Federal
Rule of Criminal Procedure 41(g), as well as damages under Bivens v. Six
Unknown Named Agents, 403 U.S. 388 (1971), alleging violations of his Fourth
and Fifth Amendment rights. Additionally, Serrano asserted a purported
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class-wide due process claim against the United States, CBP, and the CBP
Commissioner, seeking declaratory and injunctive relief, directing CBP to
provide prompt post-seizure hearings when seizing vehicles for civil
forfeiture. The district court granted defendants’ motions to dismiss and
denied as moot Serrano’s motion to certify the class.
On appeal, Serrano contends that the district court erred in dismissing
his complaint and should be reversed for three reasons: Serrano argues (1) he
properly stated a class claim that defendants must provide prompt, post-
seizure hearings when they take property for civil forfeiture based on Mathews
v. Eldridge, 424 U.S. 319 (1976); (2) he properly stated a class claim that it is
unconstitutional to condition a forfeiture hearing on the property owner
posting a bond; and (3) he claims he has a cause of action for damages under
Bivens because his claims do not arise in a new context, nor are there factors
counselling against allowing his damages claims to proceed. For the reasons
stated herein, we AFFIRM the judgment of the district court. 1
I.
On September 21, 2015, Gerardo Serrano, a U.S. citizen and resident
of Tyner, Kentucky, was driving his 2014 Ford F-250 pickup truck to Mexico
to meet with his cousin when he was stopped at the Eagle Pass, Texas, Port
1
Appellees assert that Serrano’s class claims were mooted by the return of his
property. We disagree. In Zeidman v. J. Ray McDermott & Co., this court extended the
concept of relation back in holding that “a suit brought as a class action should not be
dismissed for mootness upon tender to the named plaintiffs of their personal claims, at least
when . . . there is pending before the district court a timely filed and diligently pursued
motion for class certification.” 651 F.2d 1030, 1051 (5th Cir. 1981); see also Fontenot v.
McCraw, 777 F.3d 741, 750 (5th Cir. 2015) (stating that Genesis Healthcare Corp. v. Symcyzk,
569 U.S. 66 (2013), “does not foreclose the broader Zeidman approach to the relation back
doctrine”).
2
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of Entry. 2 While still in the United States, Serrano began to take pictures of
the border crossing with his cell phone.
Two CBP agents objected to Serrano photographing the border
facility and, after stopping his truck, physically removed him from it, took
possession of his phone, and repeatedly demanded the password to unlock
his phone. Invoking his constitutional rights, Serrano refused to provide the
password to his phone. The agents searched his vehicle, finding a .380 caliber
magazine and five .380 caliber bullets in the truck’s center console. 3
The agents handcuffed Serrano and detained him for several hours,
consistently attempting to obtain the password for his phone without success.
Serrano explained that he was not aware that the bullets and magazine were
in the truck. As he had not yet crossed into Mexico, Serrano offered to turn
around and leave the border facility or leave the magazine and low-caliber
bullets at the border facility. After being detained for about three hours,
Serrano was released, but CBP agents seized his vehicle and its contents,
including the magazine and the bullets. Serrano left the detention facility on
foot.
On October 1, 2015, CBP mailed Serrano a notice of seizure, informing
him that the truck, magazine, and bullets were seized and subject to forfeiture
because there was probable cause to believe that Serrano had attempted to
export “munitions of war” from the United States. 4 The notice advised
2
Because Serrano’s claims were dismissed on the pleadings, the alleged underlying
facts are taken as true.
3
Serrano has a valid concealed carry permit issued by his home state of Kentucky.
4
The notice stated that the “property was seized and is subject to forfeiture under
the provisions of [19 U.S.C. § 1595a(d), 22 U.S.C. § 401, 22 U.S.C. § 2778, and 22 C.F.R.
Part 127.1.]” According to 19 U.S.C. § 1595a(d), merchandise attempted to be exported
from the United States contrary to law, and property used to facilitate the exporting, shall
be seized and forfeited to the United States. The other provisions cited in the notice are as
follows: 22 U.S.C. § 401 (providing for seizure and forfeiture of illegally exported war
materials and vehicles used to attempt to export such articles); 22 U.S.C. § 2778 (control
3
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Serrano of the options that were available to him concerning the seizure: (1)
file a remission petition; (2) submit an “offer in compromise” and include a
check of the proposed settlement amount along with the offer; (3) abandon
any interest in the property; (4) request court action and have his case
referred to the U.S. Attorney for institution of judicial forfeiture proceedings;
(5) do nothing; or (6) offer to substitute release of the seized property on
payment.
If Serrano chose to have his case referred to the U.S. Attorney (option
4), the notice stated that he must submit to CBP at the address provided a
claim and “cost bond in the penal sum of $5,000 or 10 percent of the value
of the claimed property, whichever is less, but in no case shall the amount of
the bond be less than $250.00.” 5 Under this “court action” option, the
notice further advised:
If you file the claim and bond, the case will be referred promptly
to the appropriate U.S. Attorney for the institution of judicial
proceedings in Federal court to forfeit the seized property in
accordance with 19 U.S.C. § 1608 and 19 C.F.R. § 162.47. You
may then file a petition for relief with the Department of Justice
pursuant to Title 28, Code of Federal Register, Part 9 (28
C.F.R. Pt. 9). Failure to submit a bond with the claim will
render the request for judicial proceedings incomplete, and
therefore, defective. This means that the case will NOT be
referred to the appropriate U.S. Attorney.
of arms exports and imports); and 22 C.F.R. § 127.1 (violations for illegal exports from the
United States).
5
As explained in the notice, if the claimant could not afford to post the bond, he
should contact the Fines, Penalties & Forfeitures Officer so that CBP can make a
determination of claimant’s financial ability to pay the bond. “If a determination of inability
to pay is made, the cost of the bond may be waived in its entirety.” Serrano does not allege
in his complaint either that he applied for the waiver of the bond or that he was
unreasonably denied a waiver.
4
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On October 22, 2015, Serrano responded to the notice by letter,
demanding the immediate return of his truck or a hearing in court. Along with
the letter, he sent a check for $3,804.99 to satisfy the bond requirement.
According to Serrano’s bank records, CBP promptly deposited the check on
or about October 30, 2015.
On four separate occasions, Serrano called defendant Juan Espinoza,
a paralegal at CBP and the primary point of contact identified in the notice of
seizure, to inquire about the status of his case. During one of these calls,
Espinoza told Serrano that his case was taking so long because he had
requested to see a judge. Espinoza also informed Serrano that he would have
to wait for his case to be referred to an available Assistant United States
Attorney.
On December 19, 2016, Serrano submitted a Freedom of Information
Act request to CBP asking for information about the seizure and forfeiture of
his truck. As of the date of the filing of the complaint, CBP had not
responded. For 23 months, defendants failed to institute forfeiture
proceedings and Serrano was deprived of his property without a hearing to
challenge the seizure or the continued retention of his vehicle. 6
On September 6, 2017, Serrano filed a complaint for return of
property, compensatory damages, and class-wide injunctive and declaratory
relief, naming as defendants the U.S. Customs and Border Protection (CBP),
the United States, Kevin McAleenan 7 in his official capacity as the Acting
Commissioner of CBP, Juan Espinoza in his individual capacity, and John
6
Serrano alleges that the truck was held at a CBP seizure lot. While seized, he
continued to make monthly loan payments of $672.97, as well as insurance and registration
payments for a truck that he could not drive. Serrano also spent thousands of dollars on
rental cars.
7
On July 7, 2019, Mark A. Morgan was appointed to serve as Acting Commissioner
of U.S. Customs and Border Protection. Under Federal Rule of Appellate Procedure 43(c),
Acting Commissioner Morgan is automatically substituted as a party.
5
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Doe 1-X (unidentified responsible CBP agents). Serrano sought the return of
his “truck and all its contents, his magazine, five bullets, and the $3,804.99
that he posted as bond” under Federal Rule of Criminal Procedure 41(g),
alleging that the seizure and continued retention of his property violated his
Fourth and Fifth Amendment rights (Count I). Serrano also asserted an
individual Bivens claim for damages against Espinoza and other unknown and
unserved agents acting in their individual capacities for the violation of his
Fourth (Count II) and Fifth (Count III) Amendment rights. Additionally,
Serrano sought injunctive and declaratory relief on behalf of a putative class
against CBP’s policy or practice of holding seized vehicles without providing
a prompt, post-seizure forfeiture hearing, in violation of the class’s due-
process rights (Count IV). Serrano simultaneously moved to certify a class
consisting of “all U.S. Citizens whose vehicles are or will be seized by CBP
for civil forfeiture and held without a post-seizure hearing.”
The following month, on October 19, 2017, CBP returned Serrano’s
truck. However, the remainder of Serrano’s property was not returned for
several more months: Serrano filed a notice on February 26, 2018, notifying
the court that his $3,804.99 in bond money had been returned and another
notice on May 29, 2018, that his seized bullets and magazine were returned
“without apology or explanation.” 8
On December 13, 2017, defendants United States, CBP, and the CBP
Commissioner (Class Defendants) moved to dismiss Serrano’s individual
and class claims as moot and for failure to state a claim, arguing that the
claims are moot because Serrano’s property was returned, and, in any event,
due process does not require a post-seizure hearing. Class Defendants also
filed a response in opposition to the motion to certify. The same day,
Espinoza filed a Rule 12(b)(6) motion to dismiss Serrano’s Bivens claim,
8
Ultimately, Serrano was never charged with a crime and his property was
returned prior to forfeiture proceedings.
6
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seeking dismissal because Serrano failed to allege a viable Bivens claim under
existing law and contending that no Bivens claim is available in this new
context. 9 See Fed. R. Civ. P. 12(b)(6). Alternatively, Espinoza argued that
he is entitled to qualified immunity because he did not violate any clearly
established constitutional right.
Serrano conceded that the return of his property mooted his
individual claim for return of property (Count I), but otherwise opposed both
motions to dismiss.
On July 23, 2018, the magistrate judge issued a report and
recommendation. The magistrate judge concluded that Serrano’s remaining
claims were not moot, but recommended dismissal because Serrano failed to
state a claim upon which relief could be granted. Serrano filed written
objections to the report and recommendation.
On September 28, 2018, after de novo review of the report’s factual
findings and legal conclusions, the district court overruled Serrano’s
objections and adopted the magistrate judge’s recommendations based on
reasons it provided in its order. The district court dismissed Serrano’s class-
wide and individual claims under Federal Rule of Civil Procedure 12(b)(6)
for failure to state a claim upon which relief could be granted. In dismissing
Serrano’s class claims, the district court reasoned: “Because this Court finds
a weighing of the Mathews factors indicates that due process does not require
a prompt post-seizure, pre-forfeiture hearing, the Plaintiff has failed to state
a claim for which relief can be granted.”
Additionally, the district court dismissed Serrano’s Bivens claims.
The district court concluded that both of Serrano’s claims (under the Fourth
9
The motion to dismiss was filed on behalf of defendant Juan Espinoza, but noted:
“The John Doe defendants have not been identified by Plaintiff, nor have they been served.
Because this motion raises threshold defenses relating to Plaintiff’s ability to state a Bivens
claim against Defendant Juan Espinoza, it is likely that a ruling for Espinoza would also
entitle the unidentified John Doe Defendants to a judgment in their favor.”
7
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and Fifth Amendments) arise in a “new context” that is significantly
different from any of the three Bivens claims the Supreme Court has
recognized in the past. The district court further concluded that special
factors counseled against expanding the Bivens remedy in this case. The
district court explained that the remedial forfeiture scheme under the
customs laws is analogous to the statutory schemes that the Supreme Court
found preclusive of a judicially created Bivens remedy in Bush v. Lucas, 462
U.S. 367 (1983), and Schweiker v. Chilicky, 487 U.S. 412 (1988).
Serrano timely appealed. On appeal, Serrano contends that the district
court erred in dismissing his complaint and should be reversed for three
reasons: (1) he “properly stated a class claim that Defendants must provide
prompt, post-seizure hearings when they take property for civil forfeiture”
based on Mathews, 424 U.S. at 319; (2) he “properly stated a class claim that
it is unconstitutional to condition a forfeiture hearing on the property owner
posting a bond;” and (3) he has a cause of action for damages under Bivens,
403 U.S. at 388, because his claims do not arise in a new context, nor are there
factors counselling against allowing his damages claims to proceed.
II.
We review a district court’s dismissal under Federal Rule of Civil
Procedure 12(b)(6) de novo, “accepting all well-pleaded facts as true and
viewing those facts in the light most favorable to the plaintiff.” Stokes v.
Gann, 498 F.3d 483, 484 (5th Cir. 2007). “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) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
“A claim has facial plausibility 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.While the factual allegations need not be detailed, they must be
enough to raise a right to relief above the speculative level. Twombly, 550 U.S.
8
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at 555. “The court’s review is limited to the complaint, any documents
attached to the complaint, and any documents attached to the motion to
dismiss that are central to the claim and referenced by the complaint.” Lone
Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir.
2010).
III.
Due Process Claims
The main focus of Serrano’s due process challenge is to the
Government’s continued retention of seized property without a prompt
judicial hearing to determine whether the government can retain possession
of the seized property pending judicial forfeiture proceedings. Because he
claims the district court erred in concluding that CBP’s practices do not
violate due process as a matter of law, Serrano maintains that the district
court erred both in dismissing Count IV for failure to state a claim and
denying as moot his motion for class certification. Contrary to the district
court’s finding, Serrano argues that due process requires a prompt, post-
seizure hearing as evidenced by a “long line of authority requiring prompt
hearings to contest even temporary deprivations of property” and a proper
weighing of the Mathews v. Eldridge due process factors.
The Due Process Clause of the Fifth Amendment guarantees that
“[n]o person shall be. . .deprived of life, liberty, or property, without due
process of law.” U.S. Const. amend. V. “The essence of due process is
the requirement that a person in jeopardy of serious loss (be given) notice of
the case against him and opportunity to meet it.” Mathews, 424 U.S. at 348–
49 (quoting Joint Anti-Fascist Comm. v. McGrath, 341 U.S. 123, 171–72
(Frankfurter, J., concurring)). “[D]ue process is flexible and calls [only] for
such procedural protections as the particular situation demands.” Morrissey
v. Brewer, 408 U.S. 471, 481 (1972). As the Supreme Court explained in
Mathews, in identifying the “specific dictates of due process,” courts must
consider three factors: (1) “the private interest that will be affected by the
9
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official action;” (2) “the risk of an erroneous deprivation of such interest
through the procedures used, and the probable value, if any, of additional or
substitute procedural safeguards;” and (3) “the Government’s interest,
including the function involved and the fiscal and administrative burdens that
the additional or substitute procedural requirement would entail.” 10 424 U.S.
at 335.
The first factor we consider in the Mathews analysis is “the private
interest that will be affected by the official action.” Id. “The deprivation of
real or personal property involves substantial due process interests.”
Krimstock v. Kelly, 306 F.3d 40, 61 (2d Cir. 2002) (Sotomayor, J.) (citing
United States v. James Daniel Good Real Prop., 510 U.S. 43, 53–54 (1993)). 11
An individual has an important interest in the possession of his or her motor
vehicle, particularly because of its “use as a mode of transportation, and, for
some, the means to earn a livelihood.” Id. Because the seizure of a vehicle
implicates an important private interest, the main points of contention are
with respect to the balancing of the second and third Mathews factors.
Under the second Mathews factor, we consider “the risk of erroneous
deprivation of such interest through the procedures used, and the probable
10
As the district court noted, Serrano’s asserted class claims argue that due process
requires a prompt, post-seizure hearing in a court of law to determine whether the
Government can retain possession of the seized property pending judicial forfeiture
proceedings. Importantly, Serrano does not challenge the validity of the initial seizure nor
does he allege that the administrative delays in referring his case to the United States
Attorney in this instance violate due process. See United States v. Eight Thousand Eight
Hundred and Fifty Dollars ($8,850) in U.S. Currency, 461 U.S. 555, 564 (1983) (applying the
speedy trial balancing test identified in Barker v. Wingo, 407 U.S. 514 (1972), to determine
whether the Government’s delay in filing a forfeiture action was reasonable). Accordingly,
both parties’ arguments focus on the application of the Mathews factors.
11
Good involved the seizure of real property. Property that is capable of being
moved and concealed involves different concerns from the forfeiture of real property. See
510 U.S. at 52–53.
10
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value, if any, of additional or substitute procedural safeguards.” Mathews,
424 U.S. at 335. Serrano disagrees with the district court’s finding that the
federal scheme at issue affords multiple alternative remedial processes,
lowering the risk of erroneous deprivation. To the contrary, Serrano asserts
that CBP’s forfeiture procedures create a high risk of erroneous deprivation
because none of the processes available afford property owners the protection
of a neutral decision maker, as required by due process.
The risk is minimal under the second Mathews factor when we
consider the remedial procedures available that permit a claimant to contest
the deprivation of his vehicle. Cf. United States v. One 1971 BMW 4-Door
Sedan, 652 F.2d 817, 820 (9th Cir. 1981) (“The pervasive statutory
scheme. . .evidences substantial concern on the part of Congress with respect
to what process is due owners of vehicles seized under the narcotics laws and
regulations. Great weight must be given to its judgment.” (citing Mathews,
424 U.S. at 349)). Under the current customs laws, if the value of the seized
property is below $500,000, CBP sends written notice to each party that has
an interest in the claim or seized property. 12 19 U.S.C. § 1607; 19 C.F.R. §
162.31. The notice informs the claimant of a number of available options to
address the seized property, which include filing a petition for remission;
filing an offer in compromise; abandoning the property; or requesting the
matter be referred to the U.S. Attorney for institution of judicial forfeiture
proceedings.
A petition for remission offers an expedited administrative procedure
to contest the forfeiture. See United States v. Von Neumann, 474 U.S. 242,
250 (1986) (“Remission proceedings supply both the Government and the
claimant a way to resolve a dispute informally rather than in judicial forfeiture
proceedings.”). “The purpose of the remission statutes is to grant the
12
The notice identifies, among other things, the provisions of law alleged to have
been violated, a description of the specific acts or omission alleged, and additional details
about the seized property.
11
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executive the power to ameliorate the potential harshness of forfeitures.” In
re Sixty Seven Thousand Four Hundred Seventy Dollars, 901 F.2d 1540, 1543
(11th Cir. 1990).
In the petition for remission, the claimant has an opportunity to
explain why he believes he warrants relief from forfeiture. Notably, testimony
may be taken in connection with a remission petition. 19 U.S.C. § 1618.
Serrano’s notice of seizure states that if he is dissatisfied with the petition
decision or at any point prior to the forfeiture of the property, he may request
a referral to the U.S. Attorney for judicial action by filing a claim and cost
bond. In the past, the statutory administrative remission procedure was a
popular and effective tool for obtaining the return of property. See Von
Neumann, 474 U.S. at 249 n.8 (In “90% of all seizures, the claimant files a
petition for remission or mitigation,” and at least partial relief was granted in
an estimated 75% of the petitions).
Further, the fourth option, which Serrano selected, allows for an
independent evaluation and determination by the U.S. Attorney regarding
forfeiture proceedings. If the claimant elects this proceeding and properly
files a claim and bond, 13 the notice states that the “case will be referred
promptly to the appropriate U.S. Attorney for the institution of forfeiture
proceedings.” 14 See 19 U.S.C. § 1603(b) (requiring a “customs officer to
report promptly [a] seizure [made for violation of customs laws] . . . to the
United States attorney for the district in which such violation has occurred,
or in which such seizure was made”); see also 19 U.S.C. § 1604 (“It shall be
the duty of the Attorney General of the United States immediately to inquire
13
Recall that the statute provides for a potential waiver of the bond in its entirety.
14
“Since October of 1978 the constitutional requirement of promptness has been
incorporated into the Customs statutes.” United States v. One 1976 Mercedes 450 SLC, 667
F.2d 1171, 1175 n.3 (5th Cir. Unit B 1982). The parties agree that the processing timeline
provisions of the Civil Asset Forfeiture Reform Act of 2000 (CAFRA) are not applicable
to the challenged forfeiture proceeding. See 18 U.S.C. § 983(i)(2)(A).]
12
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into the facts of cases reported to him by customs officers and the laws
applicable thereto, and if it appears probable . . . to cause the proper
proceedings to be commenced and prosecuted, without delay, for the
recovery of such fine, penalty, or forfeiture.”). Thus, referral may result in
return of the property and any bond without further delay.
Indeed, Serrano concedes that the forfeiture proceeding itself would
provide the post-seizure hearing required by due process if it were held
promptly. An unreasonably long retention without instituting a forfeiture
proceeding can constitute a denial of due process. See, e.g., United States v.
$23,407.69 in U.S. Currency, 715 F.2d 162, 165–66 (5th Cir. 1983). In the
event there is a prolonged delay in initiating forfeiture proceedings, a
claimant can challenge the reasonableness of the delay under Barker. See
United States v. Eight Thousand Eight Hundred and Fifty Dollars ($8,850) in
U.S. Currency, 461 U.S. 555, 564 (1983) (applying the four-factor balancing
test of Barker, to determine whether the Government’s delay in filing a
forfeiture action was reasonable); see also Shults v. Texas, 762 F.2d 449, 453
(5th Cir. 1985) (considering $8,850 the “seminal case” addressing “whether
a delay in a post-seizure hearing offended the Fifth Amendment right against
deprivation of property without due process of law”).
Importantly, as is evidenced in this case, the property owner may file
a motion under Federal Rule of Criminal Procedure 41(g) for the return of
seized property. 15 See United States v. Sims, 376 F.3d 705, 708 (7th Cir. 2004);
15
Federal Rule of Criminal Procedure 41(g), formerly Rule 41(e), provides:
A person aggrieved by an unlawful search and seizure of
property or by the deprivation of property may move for
the property’s return. The motion must be filed in the
district where the property was seized. The court must
receive evidence on any factual issue necessary to decide
the motion. If it grants the motion, the court must return
the property to the movant, but may impose reasonable
13
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cf. Krimstock, 306 F.3d at 52 n.12 (distinguishing forfeiture under the customs
law and noting that under the customs law applicable in Von Neumann, the
claimant could file a motion under Federal Rule of Criminal Procedure 41(g)
“for return of the seized vehicle if he or she ‘believe[d] the initial seizure was
improper’” (quoting Von Neumann, 474 U.S. at 244 n.3) (brackets in
Krimstock)). Although a Rule 41(g) motion is generally available in the
context of an ongoing criminal proceeding, the court can properly construe it
as a civil complaint under the court’s general equity jurisdiction. See, e.g.,
Bailey v. United States, 508 F.3d 736, 738 (5th Cir. 2007); United States v.
Robinson, 434 F.3d 357, 361 (5th Cir. 2005); accord United States v. Craig, 694
F.3d 509, 512 (3d Cir. 2012); United States v. Search of Music City Mktg., Inc.,
212 F.3d 920, 923 (6th Cir. 2000); Floyd v. United States, 860 F.2d 999, 1002–
03, 1006–07 (10th Cir. 1988). Thus, Rule 41(g) provides an additional avenue
to challenge the seizure before a neutral decision maker and is “an action
frequently taken to force the government agency to act expeditiously.”
Muhammed v. Drug Enf’t Agency, Asset Forfeiture Unit, 92 F.3d 648, 651–52
(8th Cir. 1996). Serrano argues that Rule 41(g) is insufficient to protect the
interest of his purported class because it only allows the movant to challenge
the legality of the underlying seizure, not the interim retention of the
property pending judicial proceedings. But the availability of a prompt merits
determination minimizes any need for an interim hearing.
In assessing the risk of erroneous deprivation, we consider the
agency’s pecuniary interest in the outcome of the forfeiture proceedings. As
observed by the Supreme Court, greater procedural safeguards are “of
particular importance . . . where the Government has a direct pecuniary
interest in the outcome of the proceeding.” Good, 510 U.S. at 55–56. Serrano
alleges that CBP retains forfeited property or its proceeds to fund its law-
enforcement operations, giving the agency and its officers a direct financial
conditions to protect access to the property and its use in
later proceedings.
14
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stake in seizing and forfeiting property. However, taking these allegations as
true, the option to elect judicial forfeiture proceedings and/or file a Rule
41(g) motion in district court are existing safeguards to counter CBP’s
alleged interest in forfeiture proceeds.
Given the remedial processes available, the second Mathews factor
weighs in favor of the Government.
Finally, the third factor under Mathews requires a consideration of
“the Government’s interest, including the function involved and the fiscal
and administrative burdens that the additional or substitute procedural
requirement would entail.” Mathews, 424 U.S. at 335. Serrano disagrees with
the weight the district court attributed to the third factor, based on its
conclusion that the Government has an important interest in enforcing
customs laws and the potential administrative burden that providing prompt
hearings would place on the Government.
The third factor weighs in favor of the Government. We cannot ignore
the context of the underlying seizure. The Government’s interest in
preventing the unlawful exportation of munitions, drugs, and other
contraband is significant. See, e.g., Hernandez v. Mesa, 140 S. Ct. 735, 746
(2020) (“One of the ways in which the Executive protects this country is by
attempting to control the movement of people and goods across the
border.”); Lee v. Thornton, 538 F.2d 27, 31 (2d Cir. 1976) (“There is an
extremely important government interest in policing the passage of persons
and articles into the country across its borders.”). Further, Serrano’s
property was subject to forfeiture because the agents believed that the truck
was used in an attempt to illegally export munitions from the United States,
in violation of federal law. 16 The Government’s retention protects its interest
16
There is no dispute that Serrano’s vehicle contained the magazine and bullets
when he attempted to exit the United States and enter Mexico. Nor does Serrano dispute
that the seizure was pursuant to a statutory grant of authority under the customs laws.
15
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in the seized vehicle. Additionally, a significant administrative burden would
be placed on the Government if it was required to provide prompt post-
seizure hearings in every vehicle seizure.
Given the broad allegations in the complaint and our balancing of the
Mathews factors, we conclude that Serrano has failed to state a claim for a
procedural due process violation. As identified in the CBP’s seizure notice,
a claimant is notified of the seizure and provided options for challenging the
CBP’s action, both administratively and judicially. Serrano has not
sufficiently alleged the constitutional inadequacy of the existing procedures,
nor has he shown that the available processes are unavailable or patently
inadequate.
Moreover, our conclusion that the additional process Serrano seeks is
not constitutionally required in this context is consistent with Von Neumann.
There, the Supreme Court recognized that “implicit” in its “discussion of
timeliness in $8,850 was the view that the forfeiture proceeding, without more,
provides the postseizure hearing required by due process to protect
[claimant’s] property interest in the car.” 474 U.S. at 249 (emphasis added).
The parties dispute the relevance of Von Neumann. Compare Red Br. 22 (Von
Neumann forecloses plaintiff’s argument) with Reply Br. 13 (“[A]s the
district court correctly recognized, Von Neumann does not govern
[Serrano’s] claim.”). We agree that Von Neumann is not dispositive of
Serrano’s due process challenge; however, the Court’s reasoning is pertinent
to our due process analysis.
Von Neumann specifically notes that a claimant’s “right to a forfeiture
proceeding meeting the Barker 17 test satisfies any due process right with
17
The Supreme Court in $8,850 and Von Neumann applied the Barker test to a due
process challenge to the Government’s delay in instituting a civil forfeiture proceeding.
Barker v. Wingo, 407 U.S. 514 (1972), which addressed a defendant’s right to a speedy trial,
propounded a four-part test to be used as a guide “in balancing the interests of the claimant
and the Government to assess whether the basic due process requirement of fairness has
16
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respect to the car and the money.” Von Neumann, 474 U.S. at 251; see also
Gonzales v. Rivkind, 858 F.2d 657, 661–62 (11th Cir. 1988); LKQ Corp. v. U.S.
Dep’t of Homeland Sec., 369 F. Supp. 3d 577, 589–90 (D. Del. 2019). And
neither the Supreme Court nor the Fifth Circuit has held that the Due
Process Clause requires an additional post-seizure, pre-forfeiture judicial
hearing.
Moreover, the cases Serrano cites do not dictate a different result
under Mathews. Serrano primarily relies on the Second Circuit’s decision in
Krimstock, 306 F.3d at 40, to support his position that a prompt, post-seizure
hearing is constitutionally required while awaiting the forfeiture hearing. 18 In
Krimstock, plaintiffs challenged the constitutionality of the seizure and
retention of motor vehicles under the city’s Civil Administrative Code, a
forfeiture statute that permitted, on the basis of a first offense, seizure of “a
motor vehicle following an arrest for the state-law charge of driving while
intoxicated. . .or any other crime for which the vehicle could serve as an
instrumentality.” 306 F.3d at 44. Having identified special due process
concerns and applying the three Mathews factors, the court in Krimstock
concluded that the New York administrative code provisions at issue did not
pass constitutional muster. Id. at 67.
Krimstock does not constrain our balancing of the Mathews factors in
this case. Of particular importance, Krimstock is limited to the specific New
York City statute at issue, which is materially distinguishable from the
been satisfied in a particular case.” $8,850, 461 U.S. at 565. Courts have expressed
confusion about whether to analyze a due process challenge to a forfeiture procedure under
Barker or Mathews. See, e.g., Ford Motor Credit Co. v. NYC Police Dep’t., 503 F.3d 186, 194
(2d Cir. 2007). We agree with the parties that Mathews is more applicable here because the
harm alleged is the lack of an interim hearing rather than delay preceding an ultimate
hearing on the merits.
18
Unlike $8,850 and Von Neumann, Krimstock analyzed a forfeiture due process
challenge under the Mathews factors.
17
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forfeiture scheme Serrano challenges. 19 “[D]ue process is flexible and calls
for such procedural protections as the particular situation demands.”
Morrissey, 408 U.S. at 481.
Accordingly, Serrano’s complaint fails to state a claim upon which
relief can be granted.
Serrano also alleges that it is unconstitutional to condition a forfeiture
hearing on the property owner posting a bond
As a threshold matter, Serrano failed to object to the magistrate
judge’s findings with regard to his class claims challenging the bond
requirement to institute judicial forfeiture proceedings. Reviewing for clear
error, the district court found none and adopted the magistrate judge’s report
in full. [Id.] Because Serrano failed to object, our review is limited to plain
19
Applying the three Mathews factors, the court in Krimstock concluded that the
New York administrative code provisions at issue did not pass constitutional muster
because they failed to include a provision for a prompt post-seizure, prejudgment hearing
before a neutral judicial or administrative officer to determine whether the city was likely
to succeed on the merits of the forfeiture action and whether means short of retention of
the vehicle could satisfy the city’s need to preserve it from destruction or sale during the
pendency of proceedings. 306 F.3d 40 (2d Cir. 2002). In Ferrari v. County of Suffolk, a man
had his vehicle seized in connection with his arrest for driving while intoxicated, pursuant
to the county’s DWI seizure statute. 845 F.3d 46, 49, 59 n.18 (2d Cir. 2016). Our sister
circuit held that a district court erred in concluding that Krimstock prevented a county or
municipality from relying on public safety concerns as the basis for retention pendente lite,
and that the Due Process Clause of the Fourteenth Amendment permitted the county, after
making out a prima facie case that retention was necessary to protect its interests, to shift
the burden of going forward onto the title owner to identify an alternative measure that
satisfied the municipality’s interests. Id. The New York forfeiture statutes in Ferrari and
Krimstock are materially distinguishable from the forfeiture scheme in the present case. The
statute in Ferrari permitted forfeiture only when the vehicle was an instrumentality of a
specifically enumerated, serious crime, and the driver involved had at least one prior
conviction for such a crime. Id. at 49. The statute was “aimed specifically at repeat
offenders of New York’s drunk driving laws,” and afforded owners a prompt, post-seizure
hearing to determine if the county may retain the vehicle (unavailable with the statute at
issue in Krimstock). Id. at 50.
18
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error. Douglass v. United Servs. Auto. Ass’n, 79 F.3d 1415, 1429 (5th Cir. 1996)
(en banc), superseded by statute on other grounds, 28 U.S.C. § 636(b)(1).
The district court did not plainly err in holding that Serrano failed to
state a claim that the bond requirement violates due process. See Faldraga v.
Carnes, 674 F. Supp. 845, 850 (S.D. Fla. 1987); see also Brown v. Dist. of
Columbia, 115 F. Supp. 3d 56, 72 (D.D.C. 2015). Claimants who elect to
judicially challenge the forfeiture are generally required to post a cost bond
in the penal sum of $5,000 or 10 percent of the value of the claimed property,
whichever is less, but in no case shall the amount of the bond be less than
$250. 19 U.S.C. § 1608.
The bond serves to “deter those claimants with frivolous claims” and
“to cover the costs and expenses of the proceedings.” Arango v. U.S. Dep’t
of the Treasury, 115 F.3d 922, 925 (11th Cir. 1997) (quotations omitted). “If
the outcome of the judicial proceeding is in the claimant’s favor, the bond is
returned.” Id. (citation omitted). Additionally, to ensure that the bond
requirement does not deny indigent claimants an opportunity to contest the
forfeiture in court, CBP provides by regulation that the bond requirement
shall be waived “upon satisfactory proof of financial inability to post the
bond.” 19 C.F.R. § 162.47(e). The notice of seizure explicitly advises the
claimant that if he cannot afford to post the bond, he should contact the
Fines, Penalties and Forfeitures Officer in order for CBP to determine
claimant’s financial ability to pay: “If a determination of inability to pay is
made, the cost of the bond may be waived in its entirety.” 20 Thus, the district
court did not err in dismissing the claim.
Because we affirm the district court’s dismissal under Rule 12(b)(6)
of Serrano’s due process class claims for failure to state a claim, we also
affirm the denial of his motion for class certification as moot.
20
Serrano has not requested such a waiver, nor does he contend that he was or is
unable to afford the bond payment.
19
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Bivens Claim
Serrano additionally argues that dismissal was inappropriate because
he properly asserted an individual claim for damages under Bivens to
vindicate his Fourth and Fifth Amendment rights.
In Bivens, the Supreme Court “broke new ground by holding that a
person claiming to be the victim of an unlawful arrest and search could bring
a Fourth Amendment claim for damages against the responsible agents even
though no federal statute authorized such a claim.” Hernandez, 140 S. Ct. at
741 (citing Bivens, 403 U.S. at 388). This holding was issued at a time when,
“as a routine matter,” the Court “would imply causes of action not explicit
in the statutory text” on the assumption that courts could properly “provide
such remedies as [were] necessary to make effective” the statute’s purpose.
Ziglar v. Abbasi, 137 S. Ct. 1843, 1855 (2017) (quoting J.I. Case Co. v. Borak,
377 U.S. 426, 433 (1964)). The Supreme Court has since adopted a more
cautious approach, honoring separation-of-powers principles and stressing
that whether a damages remedy should be created requires consideration of
“a number of economic and governmental concerns.” Id. at 1856. Because of
these considerations, Congress is “better position[ed]” than the judiciary
“to consider if the public interest would be served by imposing a new
substantive legal liability.” Id. at 1857 (quoting Schweiker, 487 U.S. at 426–
427). “The Court has made clear that expanding the Bivens remedy is now a
‘disfavored’ judicial activity.” Id. (quoting Iqbal, 556 U.S. at 675).
Assuming without deciding that a Bivens remedy is available in this
context, Serrano’s complaint fails to state a claim. Serrano’s Bivens claims
are premised on the theory that unnamed CBP officers and a CBP paralegal,
Espinoza, violated his constitutional rights by seizing his truck and keeping it
for 23 months without giving him an opportunity to contest the seizure in a
post-seizure judicial hearing.
At minimum, Serrano failed to plausibly allege that any individual
federal defendant has violated clearly established law sufficient to overcome
20
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qualified immunity. Qualified immunity shields government officials from
“liability for civil damages insofar as their conduct does not violate clearly
established statutory or constitutional rights of which a reasonable person
would have known.” Pearson v. Callahan, 555 U.S. 223, 231 (2009) (quoting
Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982)). In order for an official to lose
the protections of qualified immunity, “existing precedent must have placed
the statutory or constitutional question beyond debate.” Ashcroft v. al-Kidd,
563 U.S. 731, 741 (2011). The Supreme Court has held that “qualified
immunity protects ‘all but the plainly incompetent or those who knowingly
violate the law.’” Abbasi, 137 S. Ct. at 1867 (quoting Malley v. Briggs, 475 U.S.
335, 341 (1986)). “[I]f a reasonable officer might not have known for certain
that the conduct was unlawful—then the officer is immune from liability.”
Id.Espinoza is entitled to qualified immunity. Serrano fails to set forth
any facts specifically identifying what Espinoza or any unnamed Customs
officers did to violate his rights. Instead, Serrano admits that the defendants
acted within their authority: Serrano “alleges that the government followed
the relevant statutes but that the statutes themselves violate the
Constitution.” In other words, Serrano concedes that the individual
defendants were following the relevant statutes governing the seizure of his
truck. Even if we assume that the Constitution required CBP’s employees to
follow additional or more expedited procedures, there is no existing
precedent clearly establishing as much, and thus, the individual defendants
are entitled to qualified immunity. See Kelm v. Hyatt, 44 F.3d 415, 421 (6th
Cir. 1995); CHS Indus., LLC v. U.S. Customs & Border Prot., 653 F. Supp. 2d
50, 57 (D.D.C. 2009).
IV.
For these reasons, we AFFIRM the judgment of the district court.
21