United States v. Ibrahim ( 2008 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA,  No. 07-50153
Plaintiff-Appellee, D.C. No.
v.  CR-00-00852-CAS-
TAMER ADEL IBRAHIM, 01
Defendant-Appellant.
 OPINION
Appeal from the United States District Court
for the Central District of California
Christina A. Snyder, District Judge, Presiding
Argued and Submitted
March 3, 2008—Pasadena, California
Filed April 14, 2008
Before: J. Clifford Wallace, Ronald M. Gould, and
Sandra S. Ikuta, Circuit Judges.
Opinion by Judge Wallace
3897
UNITED STATES v. IBRAHIM 3899
COUNSEL
James W. Spertus, Los Angeles, California, and Ronald Rich-
ards, Beverly Hills, California, for the defendant-appellant.
Thomas P. O’Brien, United States Attorney, Christine C.
Ewell, Assistant United States Attorney, and Steven R. Welk,
Assistant United States Attorney, for the plaintiff-appellee.
OPINION
WALLACE, Circuit Judge:
Tamer Adel Ibrahim (Tamer) appeals from the district
court’s denial of his motion for return of property, which he
3900 UNITED STATES v. IBRAHIM
filed pursuant to Rule 41(g) of the Federal Rules of Criminal
Procedure. There were no criminal charges pending at the
time he filed the motion, so the district court treated it as a
civil complaint governed by the Federal Rules of Civil Proce-
dure. The principal question before us is whether the court
erred when it applied a preponderance of evidence standard to
resolve the summary judgment motion, rather than determin-
ing whether there was a material fact in dispute and, if not,
whether the government prevails as a matter of law. Second,
we must decide Tamer’s request that we apply the doctrine of
judicial estoppel to the amount of currency seized from his
apartment. The district court had jurisdiction pursuant to 28
U.S.C. § 1331, and we have jurisdiction under 28 U.S.C.
§ 1291. We reverse.
I.
In December 1999, a task force of state and federal law
enforcement officers executed a search warrant on Tamer’s
apartment in Los Angeles, California. Tamer was suspected in
a wide-ranging conspiracy to import and traffic MDMA, the
drug commonly known as ecstasy. During the search of
Tamer’s apartment, officers seized a total of $488,970.00 in
U.S. currency. They discovered $240,000.00 in a bag outside
the apartment, $221,000.00 in a safe, $485.00 on top of a
dresser, and $27,485.00 elsewhere throughout the apartment.
Tamer was eventually convicted of conspiracy to import and
distribute MDMA in violation of 21 U.S.C. § 963 and con-
spiracy to launder monetary instruments in violation of 18
U.S.C. § 1956(h). At sentencing, the government and Tamer
both concurred in a presentence report (PSR), which mis-
takenly listed the total amount of currency seized from his
apartment as $981,485.00. The mistake apparently stemmed
from a transcription error that listed $485,000.00 as the
amount found on Tamer’s dresser instead of $485.00. Tamer
was ultimately sentenced to 188 months in prison, and
ordered to pay a $4.5 million fine and $4.5 million in restitu-
tion.
UNITED STATES v. IBRAHIM 3901
Several other defendants were indicted for crimes relating
to the same MDMA conspiracy, including Tamer’s cousin,
John Ibrahim (John). The confusion in this case stems from
the government’s failure to distinguish the two cousins. The
government instituted forfeiture proceedings against Tamer’s
property in January 2000. They initially mailed notice of these
proceedings to Tamer’s Los Angeles apartment, but addressed
the notice to John. When it was returned as undeliverable, the
government contacted John’s attorney of record. He indicated
that John had a new attorney. When contacted, that attorney
informed the government that John was being detained at the
Metropolitan Detention Center (MDC) in Los Angeles. On
May 5, 2000, the government sent notice directly to John at
the MDC. It also published notice of the forfeiture in a news-
paper of general circulation. Receiving no objection, the gov-
ernment summarily forfeited Tamer’s property on June 12,
2000. The government forfeited an additional $859.73 on
October 5, 2000 to account for interest income that was inad-
vertently left out of the original forfeiture. The notice proce-
dures followed by the government for this amount were
identical to those preceding the June 12 forfeiture.
Five years later, in January 2006, Tamer filed a motion for
return of property, pursuant to Federal Rule of Criminal Pro-
cedure 41(g). He alleged that he never received notice of the
government’s forfeiture proceedings. The government
responded, still under the mistaken impression that John and
Tamer were the same person. When Tamer pointed out the
government’s mistake, it filed a supplemental memorandum
arguing, among other things, that Tamer had received actual
notice of the forfeiture.
In September 2006, the district court issued an order deny-
ing Tamer’s motion, but ordering the parties to submit supple-
mental briefs on the issue of actual notice. The court held:
It appears that the government asserts that a factual
dispute exists as to whether movant had actual notice
3902 UNITED STATES v. IBRAHIM
of the forfeiture proceeding, given the fact that the
government did notify John Ibrahim and Ronald
Richards and published notification in the newspa-
per. Thus, pursuant to United States v. Ritchie, the
Court concludes that this motion should be con-
verted to a motion for summary judgment pursuant
to Rule 56 of the Federal Rules of Civil Procedure.
The government filed a memorandum and evidence in sup-
port of actual notice of forfeiture. It argued that actual notice
should be imputed to Tamer, even though notice was never
sent to him directly. The government pointed to telephone
recordings from the MDC which showed that Tamer and John
spoke frequently in the months leading up to the forfeiture.
The recordings also demonstrated that the two men had dis-
cussed how the forfeiture process worked generally. Notably,
the government did not have any tapes showing that Tamer
and John spoke after John received the May 5, 2000 notice at
issue in this case. Nevertheless, the government concluded
that “[b]ased on their frequent and extensive telephone con-
versations and given their close familial relationship, it is
inherently unlikely” that John failed to inform Tamer of the
notice he received on May 5, 2000. In the alternative, the gov-
ernment argued that Tamer received notice through his cur-
rent attorney, Ronald Richards, who also served as John’s
attorney “during much of the pendency of the forfeiture
action.”
In response, Tamer pointed to his sworn testimony in which
he stated that he had no recollection of ever discussing the
forfeiture proceeding with his cousin. In addition, John testi-
fied that he did not remember discussing the issue, and in fact
has not spoken with Tamer at all since March of 2000. This
statement conflicts with Tamer’s testimony, stating that the
two continued to speak frequently through July 2000. Finally,
Tamer argued that “[a]t no time was [he] represented by Ron-
ald Richards in connection with the case in front of this Court
prior to July 26, 2004.”
UNITED STATES v. IBRAHIM 3903
On January 2, 2007, the district court issued an order deny-
ing Tamer’s motion for return of property. The court
acknowledged that it was required to treat Tamer’s Rule 41(g)
motion as a civil complaint, governed by the Federal Rules of
Civil Procedure, but held:
[T]he government has provided circumstantial evi-
dence from which the trier of fact could reasonably
conclude that movant had actual notice of the forfei-
ture proceedings. Contrary to movant’s argument,
the Court need not find as a matter of law that
movant had actual notice. Rather, the Court must
consider whether the government has shown, by a
preponderance of the evidence, that movant had
actual notice.
Applying this standard, the court found that Tamer’s testi-
mony was not credible, and held that “the government has
shown by a preponderance of the evidence that John Ibrahim
or his attorneys did, in fact, inform movant about the forfei-
ture proceedings . . . .”
II.
Tamer filed his motion for return of property under Federal
Rule of Criminal Procedure 41(g). Because there were no
criminal proceedings pending at the time of filing, the district
court properly treated the motion as a civil complaint gov-
erned by the Federal Rules of Civil Procedure. See United
States v. Ritchie, 342 F.3d 903, 906-07 (9th Cir. 2003).
[1] We have only had one occasion to address the proce-
dural framework applicable to a Rule 41(g) motion when no
criminal case is pending. In Ritchie, we treated the govern-
ment’s opposition to a Rule 41(g) motion as the equivalent of
a 12(b)(6) motion to dismiss. Id. at 907. Because the district
court considered evidence outside the pleadings, however, we
remanded so that the government’s opposition could be prop-
3904 UNITED STATES v. IBRAHIM
erly converted to a Rule 56 motion for summary judgment,
consistent with the Federal Rules of Civil Procedure. Id. at
907, 911.
In the present case, the district court applied Ritchie and
held that “a factual dispute exists as to whether movant had
actual notice of the forfeiture proceeding,” therefore “this
motion should be converted to a motion for summary judg-
ment.” Unlike the court in Ritchie—which converted the gov-
ernment’s opposition into a motion for summary judgment—
the district court in this case appears to have converted Ibra-
him’s underlying motion for return of property into a motion
for summary judgement. This was an error. Under the Federal
Rules of Civil Procedure, it was the equivalent of converting
a plaintiff’s complaint into a motion for summary judgment.
The district court compounded this error at the next stage
of proceedings. Instead of applying a summary judgment
standard, it moved directly to the merits of Ibrahim’s claim.
The court concluded that it was not required to “find as a mat-
ter of law that movant had actual notice” and went on to
decide the motion under a preponderance of the evidence
standard.
[2] This ad hoc approach may be appropriate in a regular
Rule 41(g) proceeding with a criminal case pending. In that
situation, the Rule provides little guidance as to what proce-
dures the courts are required to follow, other than the broad
statement that they “must receive evidence on any factual
issue necessary to decide the motion.” Fed. R. Crim. P. 41(g).
Once the district court treated Tamer’s Rule 41(g) motion as
a civil complaint, however, it was required to apply the Fed-
eral Rules of Civil Procedure. Ritchie, 342 F.3d at 907. These
rules apply to each stage of the proceedings, the same way
they would in the civil context.
[3] Therefore, under Ritchie, a court should first convert a
government’s opposition into a motion for summary judgment
UNITED STATES v. IBRAHIM 3905
if it cannot decide the matter on the pleadings. Then, pursuant
to the Federal Rules of Civil Procedure, the court should
determine whether the government has demonstrated that
there is no “genuine issue as to any material fact,” and that it
is “entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(c); see also Taylor v. United States, 483 F.3d 385, 387-88
(5th Cir. 2007) (treating a denial of a non-criminal case
Rule 41(g) motion as a summary judgment in favor of the
government). Finally, if the government is unable to meet this
summary judgment standard, the motion for return of property
(now being treated as a civil complaint) should not be dis-
missed at the summary judgment stage, and the court should
go forward with additional proceedings consistent with the
Federal Rules of Civil Procedure. See Taylor, 483 F.3d at
389-90.
[4] The district court in this case erred because it improp-
erly converted Ibrahim’s motion for return of property into a
motion for summary judgment, and then decided the issue in
an ad hoc proceeding, under a preponderance of the evidence
standard. Treating the government’s opposition as a motion
for summary judgment, and applying the appropriate stan-
dard, we conclude that a genuine issue of material fact exists
as to whether Tamer received actual notice of the forfeiture.
Tamer and John both testified that they did not discuss the
specific notice at issue in this case. Although the government
has provided substantial circumstantial evidence to the
contrary—and this evidence may be sufficient to support a
finding of notice under a preponderance standard—there is a
genuine issue of material fact as to whether Tamer received
notice. This is particularly true since the government is
required to show not only that Tamer received notice, but also
that the information he received was “sufficiently accurate
and detailed” to allow him to protect his rights. See Ritchie,
342 F.3d at 911. We therefore reverse the district court’s sum-
mary judgment, and remand for further proceedings consistent
with the Federal Rules of Civil Procedure.
3906 UNITED STATES v. IBRAHIM
III.
Tamer next argues that he is entitled to recover a total of
$981,485.00 instead of $489,829.73 as the government con-
tends. To support the higher number, Tamer points to a line
in his PSR, which lists a total of $981,485.00 in U.S. currency
as having been seized from his apartment, including
$485,000.00 found “on top of a dresser.”
The government responds with the sworn declaration of an
Immigration and Customs Enforcement (ICE) officer present
during the seizure, who testified that only $488,970.00 was
recovered from the apartment. He clarified that 485 dollars,
not 485 thousand dollars, were seized from the top of Tamer’s
dresser. This account is supported by a contemporaneous
report prepared by the San Bernardino Sheriff’s Department
on December 29, 1999. That report specifies that a total of 24
individual twenty-dollar bills and one five-dollar bill were
retrieved from the dresser. Moreover, a paralegal from U.S.
Customs executed a sworn declaration stating that a total of
$489,829.73 had been forfeited, which included the original
$488,970.00 seized, plus $859.73 in interest. This statement
is supported by the notices sent to John on January 20, 2000
and May 2, 2000, both of which listed $488,970.00 as the
amount of U.S. currency to be forfeited.
Tamer’s entire argument rests on a single number contained
in the PSR. He offers no other evidence to support the higher
amount, other than his unsworn assertion that he “knew how
much money had been seized, and it was $981,485.00 just as
the government had said.” Nevertheless, Tamer argues that
the government, having relied on the higher number at sen-
tencing, is now barred by the doctrine of judicial estoppel
from advancing any other amount.
[5] Judicial estoppel “ ‘is an equitable doctrine invoked by
a court at its discretion.’ ” New Hampshire v. Maine, 532 U.S.
742, 750 (2001), quoting Russell v. Rolfs, 893 F.2d 1033,
UNITED STATES v. IBRAHIM 3907
1037 (9th Cir. 1990). In determining whether to apply the
doctrine, we typically consider (1) whether a party’s later
position is “clearly inconsistent” with its original position; (2)
whether the party has successfully persuaded the court of the
earlier position, and (3) whether allowing the inconsistent
position would allow the party to “derive an unfair advantage
or impose an unfair detriment on the opposing party.” Id. at
750-51. In addition, we have held that judicial estoppel “seeks
to prevent the deliberate manipulation of the courts,” and
therefore should not apply “when a party’s prior position was
based on inadvertence or mistake.” Helfand v. Gerson, 105
F.3d 530, 536 (9th Cir. 1997) (emphasis added).
[6] The district court found that the actual amount seized
from Tamer’s apartment was $488,970.00, including only
$485.00 from his dresser. This finding is supported by a con-
temporaneous report from the Sheriff’s Department, as well
as the sworn declarations of an ICE officer present at the
scene and a U.S. Customs official responsible for sending out
the relevant forfeiture notices. All the evidence in the record
thus points to the fact that the probation office merely mis-
placed a decimal point when it prepared the PSR. Tamer has
offered no evidence to the contrary, and we hold that the gov-
ernment’s mistake does not meet the criteria for applying
judicial estoppel. See Johnson v. Oregon, 141 F.3d 1361,
1369 (9th Cir. 1998) (“If incompatible positions are based not
on chicanery, but only on inadvertence or mistake, judicial
estoppel does not apply”).
Furthermore, even if we were to apply the three-inquiry
analysis from New Hampshire v. Maine, it will not “impose
an unfair detriment” on Tamer to limit any eventual recovery
to the amount actually seized from his apartment. See 532
U.S. at 750-51. Any harm Tamer may have suffered as a
result of the government’s mistake would have occurred at the
time of sentencing. In that regard, it is not clear that he suf-
fered any prejudice, even in the sentencing context. Tamer’s
PSR, in a section entitled “Assessment of Financial Condi-
3908 UNITED STATES v. IBRAHIM
tion,” states that he “earned at least $10 million during the
months before his capture and arrest.” In addition to this $10
million, the PSR also states that his ability to “pay the maxi-
mum fine and restitution is also supported by the cash that
was seized in 1999. During the searches and seizures in
December 1999 alone, over $2 million in cash was recovered
in or around three apartments on Wilshire Boulevard, one of
which was Ibrahim’s.” The erroneous $981,485.00 figure,
therefore, represented only a portion of the $2 million in cash
cited by the PSR—and that number was itself only offered to
supplement Tamer’s $10 million in unaccounted-for drug pro-
ceeds. It therefore seems unlikely that Tamer’s sentence
would have been materially affected if the relevant line from
the PSR had been properly amended to state that “over $1.5
million in cash was recovered in or around three apartments
. . . .”
In any event, this issue is not directly before us. Whatever
prejudice Tamer may have suffered at the sentencing stage
hardly justifies the “return” of nearly half-a-million dollars in
funds that were never actually seized from his apartment. To
the extent Tamer wishes to challenge his sentence directly due
to the misplaced decimal point, the government has stated
during oral argument that it would not oppose a coram nobis
petition to the district court.
REVERSED AND REMANDED.