Forfeitures and Seizures
U.S. Customs and Border Patrol acts as the enforcement arm of over 40 agencies in the United States Government, including the Food and Drug Administration (FDA); the Environmental Protection Agency (EPA); the Consumer Product Safety Commission (CPSC); the Drug Enforcement Administration (DEA); and the Bureau of Alcohol, Tobacco and Firearms (ATF). As part of its enforcement duties, U.S. Customs seizes goods from both travelers and importers, preventing noncompliant merchandise from entering the United States in violation of federal law.
Seizures - Prohibited, Restricted, or Entry Violation: Due Process Applies
Immediately after seizure, seized goods are categorized as either prohibited (hazardous. materials or narcotics); restricted (subject to trade embargo, e.g., Cuban cigars); or in violation of entry requirements (improper value or label). (Goods, otherwise compliant, can also be seized in payment of prior penalties.)
Regardless of the basis for the seizure, federal constitutional due process provisions still apply. U.S. Customs must meet constitution standards in its taking action, regardless of the nationality of the company whose goods have been seized.
Notice of Seizure Requirements
First, a Notice of Seizure must be served upon both the importer and every other entity with a valid interest in the goods. The notice must contain specific information about what was seized. It must also identify what laws were found to be violated in justification of the seizure. Finally, the notice must give the options available to the violator when petitioning for relief, including the alternatives of seeking administrative or judicial relief.
Fighting Seizures
When merchandise is seized by U.S. Customs and Border Patrol, the first decision to be made is whether to forfeit the goods or to challenge the seizure. This choice involves both legal and practical components - sometimes, it’s not worth the fight. Sometimes, the fight is worth everything.
The second decision is whether to fight the seizure by suing U.S. Customs and Border Protection in federal district court. This is an expensive and time-consuming process, and much care and deliberation is undertaken before choosing this route.
If the choice is to challenge the seizure outside of filing a formal lawsuit, then a formal petition for administrative relief must be finalized and filed with Customs. Here, the agency’s internal review procedures provide the forum for contesting the seizure.
The claimant’s petition should provide mitigating facts and circumstances legally sufficient to establish the return of some, if not all, of the seized goods to their owner. A Customs specialist then reviews the petition’s claims, balancing them against the reports of the Customs officers responsible for seizing the property, and makes a recommendation that can be any of the following:
- Claimant must forfeit all, or part, of the property;
- Customs must remit all, or part, of the property without a penalty;
- Customs must remit the property and issue a penalty;
- Customs must remit the property for immediate re-exportation; or
- Customs must return all or part of the property if the claimant provides cash in the amount of the property's value, with the money then being forfeited to the U.S. Government.
Fuerst Ittleman Helps Clients Facing Seizures
Fuerst Ittleman has helped many clients facing seizures of goods in all types of industries, covering the full spectrum of property values. Not only does Fuerst Ittleman help the client from the moment that the Notice of Seizure is received -- negotiating with Customs, reviewing the accuracy and correctness of the notice itself -- but Fuerst Ittleman works with the client in deciding how much of a fight to take on behalf of the seizure, and the best forum in which to wage that war.
International trade is a complex enterprise, and Fuerst Ittleman in-depth understanding of its complexities helps the firm counsel its clientele from both a legal and practical perspective. Seized goods must be valued in the long term for their revenue, and in the short term, against the costs in time and money of fighting Customs for their return. If a client decides to fight the matter in full and formal federal litigation, or if a client chooses to let the goods go, Fuerst Ittleman is ready to help minimize the pain of a Customs seizure and maximize an efficient, optimal resolution of the matter.
Forfeiture Proceedings
Forfeiture proceedings will be instituted by the U.S. Government when the importer either does not seek relief from a seizure in either an administration action or a civil lawsuit, or the importer fails to comply with the Custom’s recommendation (1-5 above) within a certain period of time. (In a formal lawsuit, the court’s final judgment awards the property according to its determination.)
Constitutional due process must still be met: due process requires proper notice of the intent to forfeit, as well as proper forfeiture proceedings be instituted, and due process also provides violators with additional notice -- and more time -- to make claims for the return of the property.
Forfeiture notices sent out by federal agencies (Customs, FDA, DEA) are notoriously scant when describing the remedies available to the property owner. For instance, they do not make it clear that if the claimant files for administrative remedy in lieu of judicial remedy, the decision of the agency is not reviewable.
Since asset forfeiture is the process in which the federal government permanently takes property from its owner without paying just compensation for it, as part of its police power, the law has found that all forfeiture actions are quasi-criminal in nature. They are thereby given the same level of federal constitutional protections as those guaranteed to individual defendants in criminal cases.
For example, it has been held that federal government forfeiture actions are protected by the ex post facto clause of Article II, Section 9, as well as the constitutional due process provisions.
What about the right to representation by counsel at the government's expense? The United States Supreme Court has been held that constitutional guarantees don’t go that far: importers do not have the right to a court-appointed attorney at the government's expense in forfeiture actions. Argersinger v. Hamlin, 407 U.S. 25 (1972).
Fuerst Ittleman Assists Clients with Forfeiture Proceedings
For companies facing the loss of their property without compensation to the U.S. Government, the fight is not only in the particular circumstance surrounding the good and its noncompliance with federal law, but also in insuring that the government has followed proper procedures and constitutional protections at every step of the proceeding.
When the decision is made to fight forfeiture, usually the stakes are high. Fuerst Ittleman is experienced in fighting a wide range of forfeiture situations, and the firm is astute in insuring that every facet of federal constitutional protections are addressed in any forfeiture proceeding.
