Ninth Circuit holds that U.S. seafood importer could not assert "Innocent Owner" defense in Lacey Act forfeiture proceedings against crab originally caught in violation of Russian Fishing Regulations
This interlocutory appeal arises out of the U.S. District Court for the Western District of Washington's rejection of an importer's "innocent owner" defense in forfeiture proceedings brought by the U.S. to seize about 144,774 pounds of the importer's blue king crab. Two Russian vessels had harvested the crabs within the Russian Exclusive Economic Zone (EEZ). Deep Sea Fisheries, Inc. (Deep Sea) later acquired the shipment but when it tried to import the crab into the U.S. at Blaine, Washington, U.S. Customs officials seized the shipment.
The United States brought the forfeiture action under the Lacey Act [16 U.S.C. Section 3372(a)(2)(A)]. The Act makes it unlawful for any person "to import, export, transport, sell, receive, acquire, or purchase in interstate or foreign commerce " any fish or wildlife taken, possessed, transported, or sold in violation of any law or regulation of any State or in violation of any foreign law."
The U.S. alleged that Deep Sea had taken, possessed, transported, and sold the crabs in violation of Russian fishing and resource-protection laws. Russian authorities backed these claims, declaring that, if the fishing vessels had captured the crabs in its EEZ without reporting their loading or transportation, they had contravened Russian law.
Deep Sea answered the complaint raising, inter alia, the "innocent ownership" defense under the Civil Asset Forfeiture Reform Act (CAFRA), 18 U.S.C. Section 983(d). CAFRA provides that: "(1) An innocent owner's interest in property shall not be forfeited under any civil forfeiture statute. The claimant shall have the burden of proving that the claimant is an innocent owner by a preponderance of the evidence."
"(2)(A) With respect to a property interest in existence at the time the illegal conduct giving rise to forfeiture took place, the term "innocent owner' means an owner who -- (I) did not know of the conduct giving rise to forfeiture; or (ii) upon learning of the conduct giving rise to the forfeiture, did all that reasonably could be expected under the circumstances to terminate such use of the property."
The Government countered that Deep Sea could not invoke the "innocent owner" defense because CAFRA Section 983(d)(4) states that "no person may assert an ownership interest under this subsection in contraband or other property that it is illegal to possess."
The district court granted partial summary judgment to the U.S. On interlocutory appeal, Deep Sea argued that CAFRA Section 983(d)(4) does not preclude its "innocent owner" defense because it was not inherently illegal to possess the crab. Moreover, Deep Sea noted that the district court's construction of the term "contraband" to include illegally imported goods would result in disparate treatment between fish caught in violation of domestic law and fish caught contrary to international law.
The U.S. Court of Appeals for the Ninth Circuit affirms. It explains that: "The Lacey Act ... has a strict liability forfeiture provision: All fish or wildlife or plants imported, exported, transported, sold, received, acquired, or purchased contrary to the provisions of section 3372 of this title (other than section 3372(b) of this title), or any regulation issued pursuant thereto, shall be subject to forfeiture to the United States notwithstanding any culpability requirements for civil penalty assessment or criminal prosecution included in section 3373 of this title." [Slip op. 4] (Emphasis added).
Additionally, the Court rejects Deep Sea's assertion that, for the purposes of CAFRA Section 983(d)(4), "property that it is illegal to possess" refers only to property whose possession is inherently illegal, i.e., contraband. "As the government argues, the fact that "contraband' and "other property that it is illegal to possess' are separated by an "or' signifies that Congress intended them to mean two separate things..."
"Deep Sea's proposed construction, that property that it is illegal to possess' has an identical definition to "contraband,' which it defines as contraband per se, contravenes our duty to give independent meaning to both phrases in the statute. We believe that the phrase "other property that it is illegal to possess' includes property that becomes illegal to possess because of extrinsic circumstances." [Slip op. 5]
The Court next decides that, when someone catches crabs in violation of Russian law, this makes the crabs "illegal to possess" under U.S. Law. "Deep Sea asserts that the possession of crab is not in itself illegal. Rather, the crab at issue is merely tainted by the associated violations of Russian law We disagree. We do not find dispositive the fact that the government must prove that the crab here is the product of violations of Russian law in a forfeiture proceeding before it is determined to be "illegal to possess.'" [Slip op. 5-6]
Analogizing this case to the law on unstamped cigarettes, the Court points out that, though possessing the cigarettes is not intrinsically illegal, the government can lawfully ban them if it has not pre-approved them for tax exemption. "We hold that Deep Sea may not raise an innocent owner defense here because, if the government can establish that the crab was taken, possessed, transported, or sold in a way that rendered it illegal under Russian law, the crab is "property that it is illegal to possess' for the purposes of 18 U.S.C. Section 983(d)(4). It is illegal to posses [sic] not because crab is inherently unlawful, but because this particular shipment of crab allegedly was received and acquired in a way that rendered it illegal under the Lacey Act, 16 U.S.C. Section 3372(a)." [Slip op. 6]
Citation: United States v. 144,774 Pounds of Blue King Crab, 410 F.3d 1131 (9th Cir. 2005).
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