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United States v. $42

United States District Court, S.D. Indiana, Indianapolis Division

August 21, 2019

$42, 600.00 UNITED STATES CURRENCY, Defendant. DON MERRITT, Claimant.



         This matter is before the Court on Claimant Don Merritt's (“Merritt”) Motion to Dismiss. (Filing No. 10.) Plaintiff, the United States of America (the “Government”), initiated this action seeking forfeiture of Defendant $42, 600.00 United States Currency (“Currency”) that it seized, pursuant to 21 U.S.C § 881(a)(6) because it allegedly constitutes proceeds of, or was used to facilitate, a violation of the Controlled Substances Act. (Filing No. 1.) Merritt moves to dismiss the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), for failure to state a claim upon which relief may be granted. For the reasons stated below, the Court denies Merritt's Motion to Dismiss the Complaint.

         I. BACKGROUND

         As required when reviewing a motion to dismiss, the Court accepts as true the factual allegations in the Complaint and draws all inferences in favor of the Government as the non-moving party. See Bielanski v. County of Kane, 550 F.3d 632, 633 (7th Cir. 2008).

         In October 2010, Merritt was convicted after pleading guilty in state court to dealing in cocaine, a Class A felony. (Filing No. 1 at 2.) The Marion Superior Court sentenced Merritt to twenty (20) years in prison. Id. He received credit for time served and applicable credit time allowing him to obtain parole on February 19, 2018. Id. On May 16, 2018, parole officers with the Indiana Department of Correction visited Merritt at his residence located at 2013 North Euclid Avenue, Indianapolis, Indiana. Id. The officers searched Merritt's room under the authority granted to them by Merritt's parole status. Id. Underneath Merritt's bed and inside a black plastic bag, officers found $42, 600.00 United States Currency. Id. at 3. The Currency was rubber-banded in thousand-dollar increments, then banded again in increments of five thousand dollars. Id. Two syringes and rolling papers were also found in Merritt's room. Id.

         One of Merritt's adult family members consented to a search of the entire home. Id. In the basement, officers found a scale and a kilogram-sized plastic bag with marijuana residue or “shake” inside it. Id. An officer of the Indianapolis Metropolitan Police Department deputized as a Task Force Officer with Department of Homeland Security, Homeland Security Investigations (“DHS-HSI”) was called to the scene to assist the parole officers. Id. A certified narcotics detection canine also assisted and gave a positive indication for the odor of a controlled substance on the Currency. Id.

         After officers read Merritt his Miranda rights, he made a statement concerning the Currency. Merritt stated that the money belonged to his girlfriend from the sale of a home. Id. However, he declined to provide his girlfriend's contact information. Id. Merritt verbally denied ownership of the Currency and signed a DHS-HSI abandonment form disclaiming any ownership of the Currency. Id. On May 16, 2018, DHS-HSI seized the Currency as being the proceeds of, or used to facilitate, unlawful distribution of controlled substances. Id. On December 12, 2018, the Government filed a Complaint of Forfeiture in Rem based on these facts. (Filing No. 1.) On February 15, 2019, Merritt filed a Motion to Dismiss. (Filing No. 10.) Thereafter, the Government filed its Opposition to the Motion to Dismiss (Filing No. 11), and Merritt filed a Reply (Filing No. 12).


         Federal Rule of Civil Procedure 12(b)(6) allows a defendant to move to dismiss a complaint that has failed to “state a claim upon which relief can be granted.” Fed R. Civ. P. 12(b)(6). When deciding a motion to dismiss under Rule 12(b)(6), the court accepts as true all factual allegations in the complaint and draws all inferences in favor of the plaintiff. Bielanski, 550 F.3d at 633. However, courts “are not obliged to accept as true legal conclusions or unsupported conclusions of fact.” Hickey v. O'Bannon, 287 F.3d 656, 658 (7th Cir. 2002).

         The complaint must contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Therefore, the court must determine whether the complaint contains sufficient factual matter, accepted as true to “state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).

         The United States Supreme Court further explained that although “detailed factual allegations” are not required, mere “labels, ” “conclusions, ” or “formulaic recitation[s] of the elements of a cause of action” are insufficient. Id. See Bissessur v. Ind. Univ. Bd. of Trs., 581 F.3d 599, 603 (7th Cir. 2009) (“it is not enough to give a threadbare recitation of the elements of a claim without factual support”). To be facially plausible, the complaint must allow “the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556).

         In addition, civil forfeiture complaints are subject to a heightened pleading standard described in Federal Rule Civil Procedure Supplemental Rule G. See United States v. Funds in the Amount of $239, 400, 795 F.3d 639, 641 (7th Cir. 2015) (“Rule G is a supplement to the Federal Rule of Civil Procedure that applies to in rem actions”). The rule states, in relevant part, that a complaint must:

(a) be verified; (b) state the grounds for subject-matter jurisdiction, in rem jurisdiction over the defendant property, and venue; (c) describe the property with reasonable particularity; (d) if the property is tangible, state its location when any seizure occurred and - if different - its location when the action is filed; (e) identify the statute under which the forfeiture action is brought; and (f) state sufficiently detailed ...

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