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United States v. Sum of $70

United States District Court, D. Columbia.

April 18, 2014

UNITED STATES OF AMERICA, Plaintiff,
v.
SUM OF $70,990,605, et al., Defendants

Decided April 17, 2014

For UNITED STATES OF AMERICA, Plaintiff: Elizabeth Ann Aloi, LEAD ATTORNEY, U.S. DEPARTMENT OF JUSTICE, Washington, DC.

For HIKMATULLAH SHADMAN, HEKMAT SHADMAN GENERAL TRADING, LLC, HIKMAT SHADMAN LOGISTICS SERVICES COMPANY, EVEREST FAIZY LOGISTICS SERVICES, ROHULLAH, FAIZY ELHAM BROTHERS, LTD., NAJIBULLAH, Claimants: Bryant S. Banes, LEAD ATTORNEY, NEEL, HOOPER & BANES P.C., Houston, TX; James Wallace Porter, III, BRADLEY ARANT BOULT CUMMINGS LLP, Washington, DC.

For AFGHANISTAN INTERNATIONAL BANK, Claimant: Andrew C. Bernasconi, LEAD ATTORNEY, REED SMITH LLP, Washington, DC; Kathleen A. Nandan, LEAD ATTORNEY, REED SMITH, LLP, Pittsburgh, PA; Pablo Quinones, LEAD ATTORNEY, PRO HAC VICE, Reed Smith LLP, New York, NY.

OPINION

RICHARD W. ROBERTS, Chief Judge.

Page 210

MEMORANDUM OPINION AND ORDER

Plaintiff United States filed this civil in rem forfeiture action, alleging that the defendant funds -- approximately $63 million in three different banks -- are the proceeds of a wire fraud conspiracy and subject to seizure under 18 U.S.C. § § 981, 983 and 984. The United States moves under 18 U.S.C. § 981(g)(1) to stay the civil forfeiture proceeding, except for any forthcoming government motions to strike under Supplemental Rule G(8)(c), until the conclusion of the related criminal proceedings. Claimants Hikmatullah Shadman, Najibullah, and Rohullah (" Shadman claimants" ) and Afghanistan International Bank (" AIB" ) also move for leave to file surreplies. Because a protective order can protect the interests of the parties, a complete stay is unjustified and the government's motion to stay will be denied. Because the proposed surreplies are unnecessary, the claimants' motions for leave to file surreplies will also be denied.

BACKGROUND

In short, the United States has alleged that the defendant property is subject to forfeiture as the proceeds of a wire fraud conspiracy and that Shadman, as a subcontractor and owner of Hikmat Shadman Logistics Services Company (" HSLSC" ), " conspired to obtain payments from the United States for the transportation of military supplies in Afghanistan through the illegal and fraudulent use of the wires . . . [by making] bribe payments, fraudulently inflat[ing] prices, and caus[ing] the United States to be invoiced for and to make payments of $77,920,605 to two bank

Page 211

accounts in Afghanistan[.]" 2d Am. Compl. ¶ ¶ 10, 34. The United States alleges that Shadman paid bribes to TOIFOR Global Life Support Services operations managers Henry Omonobi-Newton and Paul Hele, id. ¶ ¶ 24, 38, and that Shadman conspired with Hele to " inflate[] and manipulate[]" subcontractors' bids, id. ¶ 39, to allow Hele " to award TMRs [Transportation Movement Requests] to [HSLSC] at an inflated rate," id. ¶ ¶ 23, 39g. Allegedly because of the bribery and fraud, HSLSC was awarded 5,421 TMRs, which cost the United States $77,920,605. See id. ¶ ¶ 35, 43.

On August 27, 2013, Shadman, Najibullah, and Rohullah filed a verified claim and statement of interest in the seized property, asserting that they are the owners of the seized funds. Verified Claim and Statement of Interest or Right in Property Subject to Forfeiture In Rem at 8. They made these claims both individually, and on behalf of their companies. Id. at 14-16. It appears that all the accounts are held in the name of the companies, rather than the individuals, except for one account at Emirate National Bank. Id. at 8-12. The Shadman claimants then filed a motion under 18 U.S.C. § 983(f) for immediate release of funds and a motion for preliminary injunctive relief, both of which have been denied. The Shadman claimants also filed a motion to dismiss for failure to state a claim and based on the affirmative defenses of international comity and the act of state doctrine, which was also denied.

On October 16, 2013, AIB filed a verified claim, asserting that it has legal title, ownership, and possessory interest to $4,330,287.03 of the defendant funds. AIB's Verified ...


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