Minalkumar Patel v. United States of America, No. 9:2019mc81181 - Document 27 (S.D. Fla. 2019)
Court Description: ORDER denying 5 Motion for Return of Seized Funds and 6 Motion to Unseal Seizure Warrant Affidavits and Related Pleadings. Signed by Magistrate Judge William Matthewman on 9/9/2019. See attached document for full details. (kza)
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Minalkumar Patel v. United States of America Doc. 27 UN ITED STA TES D ISTRICT C OU RT SOU TH ERN D ISTRICT OF FLO RIDA Case N o.9:19-M C-8118I-W M M inalkum arPatel, FILED BY M ovant, .. SEF 28 2219 United StatesofA m erica, ANGELA E.NOBLE CLERK U S DIST.CX s.o.ogF'1 A .-w.RB. Respondent. / ORDER DENYING M OTION FOR RETURN OF SEIZED FUNDS IDE 51AND M O TIO N T O U NSEAL SEIZUR E W A RM N T A FFIDA V ITS A N D RE LA TED PLEADINGS IDE 61 THISCAUSE isbeforetheCourtonM ovantM inalkumarPatel'sCtMovanf')M otionfor ReturnofSeizedFundsandRequestforExpeditedHearing gDE 51and MotiontoUnsealSeizure W arrantAftidavitsandRelatedPleadingsandRequestforExpeditedHearing (DE 61.lnthetirst motion (DE 51,M ovantseeksthereturnorreleaseofthefundsheld in sixbank accountsseized bytheGovemmentpursuanttopre-indictmentseizurewarrantsissuedunder21U.S.C.j853(9. In the second (DE 6J,heurgestheCourtto unsealtheaftidavitsunderlyingthepre-indictment seizure w arrants, as w ell as any pleadings related to the sealing of those docum ents.l The Governmentfiled acombinedresponsein oppositionto both motions.(DE 161.Afterholdinga hearing and carefully considering the m otions,a11supporting and opposing filings,and the record in thiscase,the Courtdenies the m otions. lPertheGovernm ent,onlyonemasteraffidavitsupportedthesixseizurewarrantsdirectedtoM ovant'sbankaccounts. (DE 16at1,n.1).Therefore,althoughMovantrequeststhatthisCourtunsealtheaffidavitsunderlyingthesixseizure warrants,only onem asteraffidavitis atissue. Dockets.Justia.com 1.Issues Presented Thisdispute concernstw o im portantissues.The firstissue iswhetherM ovantisentitled to the rettum or release of funds held in six bank accounts the Governm ent seized pursuantto six seizure warrantsissued by this Courttmder21 U.S.C.j 85349.The second issue iswhether M ovanthasa pre-indictm entrightto obtain copiesofthe sealed affidavitunderlying those seizlzre w arrants,and the related sealed pleadings,underthe FirstA m endm ent,Fourth Am endm ent,and federalcom m on law .The second issue appears to be an issue of firstim pression as neither the Courtnorthe partieshave located a federalcourtorderoropinion addressing a m ovant'sasserted pre-indictmentrightto obtain copies ofa sealed seizure warrantaffidavit(and related sealed pleadings)underlyingseizurewarrantsdirectedtoamovant'sbankaccountsissuedpursuantto21 U.S.C.j853(9. II.Backeround On August 15,2019, after reviewing a lengthy and detailed aftidavit,the undersigned, pursuantto 21U.S.C.j 853(9,approved and issued six seizure warrantsdirected to six bank accounts held in M ovant's nam e.The six sealed seizure warrantapplications w ere assigned six different case num bers,to w it: 19-M J-8323-W M ; 19-M J-8324-W M ;19-M J-8325-W M ; 19-M J8326-W M ;19-M J-8327-W M ;and 19-M J-8328-W M .The six seizure w arrantsissued by the Court w erethen im m ediately served by the Governm entupon the variousbanksw here the accountsw ere held.Shortly thereafter,on A ugust21,2019,M ovantfiled m otions in each ofthe six sealed cases w hich soughtthe return orrelease ofthe fundsheld in those accountsand copies ofthe underlying affidavitand related pleadings. On A ugust 22,2019,the Courtentered an order consolidating the six cases under case nlzm ber 19-M C-8118I-W M and ordered the consolidated case sealed untilfurther Order of the 2 Court.(DE 11.2Through hismotions,M ovantseeksan order(l)unsealing the Government's seizurewarrantapplicationsand supporting affidavit;(2)unsealingtheGovernment'smotionto sealthosedocuments' ,(3)unsealingany documentsormotionsexplainingwhytheGovernment soughtseizurewarrantsunder21U.S.C.j853(9 inthiscaseratherthanaprotectiveorderunder j853(e);and(4)releasinganyseizedfundsnotshowntobeproceedsofany criminalactivity or usedtofacilitatecriminalactivity.(DE 5,61. A sto the seized bank accounts,M ovantarguesthat,pursuantto FederalRule of Crim inal ProcedureRule41(g)andtheSixthAmendmenttotheUnitedStatesConstitution,theCourtshould orderthe return orrelease of any tstm tainted''fundsseized by the G overnm entand setthism atter foranevidentiaryhearingwhereheintendstoshow that:(1)becauseoftheGovernment'sseiztlre ofallhisfunds,heisunabletosecurecounselofhischoiceand (2)lssubstantialportionsofthe fundsseized wereuntainted,i.e.,notderived from any unlawfulactivity.''(DE 5at21.Movant statesSklalpproximately30% ofa1lrevenuepaidto''hisemployer,Labsolutions,LLC,camefrom traditionaltoxicology testsSlthathave no relationship to any telem edicine-genetic practice,or any other supposedly illegalconductpresum ably described in the seizure w arrants''and he tddoesnot have any ofhisown funds thatare notfrozen to retain counsel.''1d.A sto the sealed doctzm entsin thism atter,including theaffidavitunderlying the seizure warrants,M ovantcontendshe hasa right to obtain copiesofthose docum entsunderthe FirstA m endm ent,Fourth Am endm ent,and federal com m on law . Foritspart,the Govelmm entstates itsinvestigation isongoing and urgesthe Courtto deny M ovant'srequeststo protectthe integrity ofthatinvestigation and preventthe possible destruction 2 On August2s, 2019,theCourtentered an orderunsealing thiscase.(DE 181.Thatordergeneral lyunsealedthe M ovant'smotions,theGovernm ent'sresponse,and related filings.ltdid notunsealtheaffidavitunderlying theseizure warrantsorrelatedpleadings.Thatissueisdecided by theCourtinthisorder. 3 ortransferofforfeitableassets.gDE 16).TheCourtheldahearingregardingthisdisputeonAugust 27,2019.A tthe end ofthe lengthy public portion ofthe hearing,the Courtalso heard from the Govenunentin a briefsealed,exparte hearing. 111. D iscussion A .M otion for R eturn or R elease ofSeized Funds M ovantseeksthe return orrelease ofthe fundsheld in hissix seized bank accountsunder both Rule 41(g)ofthe FederalRulesofCriminalProcedure and the Sixth Amendmentto the UnitedStatesConstitution.gDE 5at11.lnthisregard,itisimportanttonotethattheGovemment hasyetto initiate forfeiture proceedings asto M ovant's six bank accounts. Federal courts have tsthe power to order the suppression or retum of unlaw fully seized property even though no indictm enthas been returned and thus no crim inalprosecution is yetin existence.''Hunsuckerv.Phinney 497F.2d 29,32 (5th Cir.1974).TheUnited StatesCourtof A ppealsforthe Eleventh Circuithasheld this rem edy is equitable in nature.See U S.v.D ean,80 F.3d 1535,1542(11thCir.1996)(explainingthedoctrineofequitablejurisdictionpermitsfederal courtstotakejurisdictionoverpropertytoadjudicateactionsforthatproperty'sreturneventhough no indictment has been rettmled).di-f'he decision to invoke equitable jurisdiction is highly discretionary andmustbe exercisedwith caution and restraint.''Matter(f$67,470.00,901F.2d 1540,1544(11thCir.1990).Sssuchjurisdiction,therefore,isonlyappropriateinexceptionalcases w here equity dem andsintervention.''1d. ln Richey v. Sm ith, the fonner U nited States Court of Appeals for the Fifth Circuit elucidated severalfactors federalcourts should considerw hen deciding m otionsto return seized property.515 F.2d 1239,1243-44 (5th Cir.1975).First,whetherthe Governmentshowed a iscallous disregard''for a m ovant's constitutionalrights.1d.at 1234.Second,w hetherthe m ovant 4 hasan individualinterestin andneed fortheseizedproperty.1d.Third,whetherthemovantwould beirreparablyinjuredifthepropertyisnotreturned.1d.Andfinally,whetherthemovantçihasan adequateremedyat1aw fortheredressofhis(orherlgrievance.''Id.at1243-44. Applying these factorshere,the Courtfindsthatthism atter is notone ofthe Siexceptional caseswhereequitydemandsintervention.''M atterof$67,470.00,901F.2datl544. First,the Governm entseized M ovant's bank accountspursuantto seizure w arrants issued under21U.S.C.j 853(9 bytheundersigned United StatesMagistrateJudge,who,aftercaref'ul consideration ofa lengthy and detailed affidavit,fotmd probable cause thatthe fundsw ithin those sixaccountsweresubjecttoforfeiture.Thus,itcannotbesaidtheGovernmentactedwithStcallous disregard''forM ovant'sconstitutionalrightsasitfollow ed al1constitutionally required procedtlres in obtaining seizurewarrantsforM ovant'sbank accounts.SeeMatterof Search of 4801 Fyler Wvc.,879 F.2d 385(8th Cir.1989)(finding noStcallousdisregard''ofconstitutionalrightswhere Ssfederalagentssearchinggthe)premisestirstobtainedawarrant''basedonç$alengthyanddetailed aftidavitdescribingabroadrangeofillegalactivitytoestablishprobablecause''). Second,M ovanthas notshown an individualneed forthe retul' n or release ofthe seized funds.H e arguesthe seizure ofhisbank accountsw illcause a parade ofhonibles.lfthe ftmdsare not released,he says, it ûlw ill significantly ham per the ongoing business of Labsolutions,''his com pany,tsw hich in turn could resultin the term ination of 120 salaried em ployees and scores of independentcontractors.''(DE 6 at21.Thecompany willbeunableto ûspaythehealth insurance for a11these em ployees''or ttperfonn laboratory analysis for hundreds and perhaps thousands of blood and urine sam ples subm itted by tbrick and m ortar'doctorshaving nothing to do''w ith the activityhebelievesisatissue.1d.ThiswillSûendangerglthelivesofthosedoctors'patients.''1d. But,astheGovenunentstatedin itsresponse,LabsolutionsdoesnotjoinM ovant'schallengeto 5 the seizure w arrants and, in fact, is not contesting any w arrants related to the Governm ent's ongoing investigation atthistim e. (DE 16at21.aFurther,thesix seizedbank accountsatissuei n thisO rderare a1lheld in M ovant'sindividualnam e and notin Labsolutions'nam e.Thus,the fact thatLabsolutionsm ay have a need forthe seized fundsis irrelevantforpurposes ofthisdisputeas M ovantm ay notseek the return ofproperty belonging to athird party.See United statesv.H ow ell, 425F.3d971,974 (11thCir.2005).M ovant'sargumentthatLabsolutionswillbeharmedbythe G overnm ent's seizure ofM ovant's individualbank accountsisw holly w ithoutm erit. M ovant'sonly otheridentified need forthe return orreleaseofthe fundsin hisseized bank accounts is to retain counselofhis choosing.See DE 5 at 2.Butboth the Suprem e Courtof the U nited Statesand the Eleventh Circuithave held thatthe Sixth A m endm entrightto counselttdoes notattach untilaprosecutioniscommenced,thatis,atoraftertheinitiation ofadversaryjudicial proceedings whether by w ay offonnalcharge,prelim inary hearing,indictm ent,inform ation,or arraignment.''Philmorev.McNeil,575F.3d1251,1257(11thCir.2009). ,seeMcNeilv.Wisconsin, 501 U.S.171,175 (1991).M ovanthas notbeen criminally charged atthispoint.His Sixth Am endm entrightto counselhasnotyetattached.Id Thus,the CourtfindsM ovanthasnotshown an individualneed for the im m ediate return or release of the funds held in the six seized bank accounts. Third,M ovanthas failed to show he willsufferirreparable harm ifthe six seized accounts arenotreturnedorreleased.HeallegestheGovernment'sseizurewillharm him bypreventing(1) his com pany from m eeting itspayrollobligations orperfonning laboratory tests forpatients and (2)him from retainingthecounselofhischoosing.(DE 5at21.Asstatedabove,anyharm caused 3 In its com bined response, the Governmentstated thatitexecuted fourwarrantsrelated to bank accounts held in Labsolutions,LLC'Sname.(DE 16at2).Thosewarrantsarenotpartofthisconsolidated case.Allsix warrantsat issueherew eredirectedto bank accountsheld in M ovant'sindividualnam e.1d. 6 tohiscompany,which doesnotjoinhismotions,isseparateanddistinctfrom anyharm causedto M ovantrelating to hisindividualaccounts.And since M ovant'sSixth Am endm entrightto counsel has notyet attached,see Philm ore,575 F.3d at 1257,he has not suffered any irreparable harm from being unable to afford counselatthistim e.As M ovanthas failed to allege any irreparable harm from the Government's seizure,the Courtfinds this factor also weighs in favor of not ordering the return orrelease ofthe seized funds. Finally,the fourth factor,whether M ovanthas an adequate rem edy at 1aw to redress his grievance,also w eighsagainstordering the return orreleaseoftheseized funds.A lthough M ovant asserts thathe currently has no rem edy at 1aw to dispute the Governm ent's seizure of his bank accounts,StgalslongastheGovernmentinfactinitiatesforfeitureproceedingswithinareasonable periodoftime,''hewillbeprovidedanadequateremedyatlaw.MatterofseizureofMerchantsdr MarineBankAccounts and ,2019W L 3558181,at*3 (S.D.M iss.Aug.4,2019). The Governm entstatesitdtintendsto initiateforfeiture proceedingsw ithin a reasonable and lawfulperiod oftime.''gDE 16 at71.Additionally,the Courtis informed by counselforthe G overnm ent's representations at a sealed, ex parte hearing concerning the G overnm ent's tim efram e for initiating forfeiture proceedings.H ere,M ovant's accounts were seized on A ugust l5,20l9,im m ediately afterthe undersigned issued w arrantsfortheirseizlzrepursuantto 21U .S.C. j853(9.gDE 16 at21.Giventhatbarelymorethantwo weekshavepassed sincetheissuanceof the seizure w arrants and given the representations the Governm ent's Assistant U nited States Attorney m ade to the Courtboth atthe public hearing and atthe sealed,ex parte portion of the August27,20l9 hearing,the Courtfindsthe Governm enthasnotunreasonably delayed initiation of forfeiture proceedings.See M erchants & M arine Bank A ccounts,2019 W L 3558181,at #3; M otionforReturnofAllMoniesSeizedfrom Account710707atAm.Exp.Bank,1991W L 183363, 7 at*2(S.D.N.Y.Sept.l1,1991).W hen itdoesinitiatethoseforfeitureproceedings,Movantwill have an adequate rem edy atlaw w ith w hich to challenge the seizure ofthe funds which he asserts he ow ns. ln sum ,the Richey factors counselagainstordering the return orrelease ofthe seized funds atthisearlyjuncture.M ovant'sM otion forReturn ofSeized Fundsand RequestforExpedited Hearing(DE 5)isthereforeDENIED. B.M otion to U nsealSeizure W arrantA ffidavitand R elated Pleadings Thepublic'srightofaccessto courtproceedingsandjudicialrecordsisgovernedby the First Am endm ent,Fourth Am endm ent,and federalcom m on law .See U S.v.Bennett,2013 W L 3821625(S.D.Fla.2013).M ovantargueseachprovidesanindependentbasisfortheCourttogrant his m otion to unseal.The Courtdisagrees. i.Firstand Fourth A m endm ents Sdl-l-lhepublicandpresshaveapresumptive,yetqualified,FirstAmendmentrightofaccess tojudicialproceedingsincriminalmatters.''1d.at*2.TheEleventhCircuithasfoundthisqualified rightofaccess extendsto accessto courtdocum ents,applying the Stcom pelling interest''standard. SeeBrownv.AdvantageEng.,960F.2d 1013,1015-16(11thCir.1992).Thus,theCourtmaydeny M ovant access to the seizure w arrant affidavit and related pleadings étonly if a tcom pelling governm ent interest' in closure exists and denial of access is tnarrow ly tailored to serve that interest.'''Bennett,2013 W L 3821625,at*4 (quoting GlobeNewspaperCo.v.SuperiorCourt, 457U.S.596,606(1982)). Sim ilarly,the Fourth A m endm entm ay granta rightof access to pre-indictm ent warrant aftidavits.Butthatrightis notabsolute.llltather itis qualified and m ay be lim ited orcom pletely denied iupon a show ing of a com pelling governm ent interest that cannotbe accom m odated by 8 somemeanslessrestrictivethan sealing thecourt'srecords.'''1d.(quoting In reSearch of Up NorthPlastics,Inc.,940F.supp.229,232 (D.M irm.1996)). Sllplotential prejudice to an ongoing criminalinvestigation represents a compelling govenunentinterestthatjustifiestheclosureofjudicialrecords.''Id at*4(citing US.v.Valenti, 987 F.2d 708,714 (11th Cir.1996),cert.denied,510 U.S.907 (1993)).Here,theGovernment argues unsealing the underlying affidavittsw ould negatively im pactthe integrity of the ongoing investigationbyprematurely disclosingitsscopeanddirection,subjects,andpotentialwitnesses, and could resultin thedestruction ofevidence,witnesstampering,orflight.''gDE 16 at4J.The Courtagrees.The Goverm nent's com pelling interestis clear.The Courttinds thatunsealing the underlying aftidavitand related documentswould severelyprejudicetheGovernment'songoing investigation. A s to whether there are ûtsom e m eans less restrictive than sealing the court's records,'' Bennett,2013 W L 3821625,at*4,the G overnm entstates thatitredaction orpartialrelease of the aflidavitisnotafeasiblealternativeasevery page (oftheseizurewanuntaffidavitlcontainsat leastsom e inform ation thatcould com prom isethe Governm ent'sinvestigation ifitw ere released.'' (DE 16at41.Giventhedetailscontainedin theaffidavit,theCourttindsthatredaction ofnames and other identifying inform ation would not adequately assure the G ovem m ent'sneed to protect the integrity of an ongoing investigation.Thus,the Court finds the G overnm ent's com pelling interestin protecting its ongoing investigation outw eighs any presum ption ofaccessM ovantm ay haveto the seizure w arrantaftidavitsand related docum entsundertheFirstA m endm ent.1d.at*4. ii.Comm on Law #ï#/l/ofAccess Finally,federalcoul' tshavelongrecognizedarightofaccesstojudicialrecords.SeeNixon v.WarnerComm.,lnc.,435U.S.589,597(1978);U S.v.Rosenthal,763F.2d1291,1292-93(11th 9 Cir.1995).Thisrightcanbeovercomebyashowingofésgoodcause,''whichrequirestheCourtto tsbalance the asserted rightof access againstthe otherparty's interestin keeping the inform ation confidentialv''Romero v.Drummond Co.,Inc.,480 F.3d 1234,1246 (11th Cir.2007).Thisisa fact-specific analysisthatvariescase-by-case.See Bennett,2013 W L 3821625,at *6-7.Here,the G overnm ent's interest in keeping the details of its investigation sealed is clear.B alancing M r. Patel's individualinterests againstthe G overnm ent's,there is good eause for tinding M r.Patel's com m on law rightofaccess to the affidavits has been overcom e. Thus,M ovant's M otion to U nsealSeizure W arrantA fiidavits and Related Pleadings and RequestforExpeditedHearing (DE 6)isDENIED. IV .C onclusion Upon review of the m otions and being f'ully advised of the prem ises, it is hereby O R D ER ED asfollow s: 1. M ovant'sM otionforReturnofSeizedFundsandRequestforExpeditedHearing(DE 51isDENIED. M ovant's M otion to U nseal Seizure W arrant A ffidavits and R elated Pleadings and RequestforExpeditedHearing(DE 61isDENIED. 3. The denialofM ovant'smotions is withoutprejudice to hisability to file a futtlre am ended m otion for return or release of seized funds, or a separate civil or adm inistrative action,to the extentsuch reliefm ay be available to M ovant,in the event the G overnm ent unreasonably delays the institution of forfeiture proceedings.See Merchantsd:MarineBankAccounts,2019W L 3558181,at*3(finding73-day delay ininstitutingforfeitureproceedingsnottmreasonable);MotionforReturnofAllMonies Seizedfrom Account710707atAm.Exp.Bank,1991W L 183363,at*2(finding5410 day delay in instituting forfeitureproceedingsnotunreasonable).ThisOrderisalso withoutprejudicetoM ovant'sabilityto contestany criminalforfeitureproceedingin the eventone isinitiated. DONEANDORDEREDinchambersatPalmBeachCounty,Floridathis i Ydayof , Septem ber,2019. W ILLIAM M A TTH E M AN U nited StatesM agistrate Judge 11
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