United States District Court, E.D. California
FINDINGS AND RECOMMENDATIONS RECOMMENDING THE GRANT OF PLAINTIFF'S EX PARTE MOTION FOR DEFAULT JUDGMENT (Doc. 22)
GARY S. AUSTIN, Magistrate Judge.
In this in rem forfeiture action, Plaintiff United States of America (the "Government" or "Plaintiff") filed an Ex Parte Motion for Default Judgment and for Final Judgment of Forfeiture. (Doc. 22). No opposition to the government's motion was filed. The matter was taken under submission without oral argument pursuant to Local Rule 230(g) and the hearing set for this matter was VACATED. (Doc. 13). For the reasons set forth below, the Court RECOMMENDS that Plaintiff's motion be GRANTED.
A Verified Complaint for Forfeiture In Rem (hereafter "Complaint") was filed on March 8, 2013. The Complaint alleges that the defendant counterfeit jerseys constitute property bearing or consisting of a counterfeit mark in violation of 18 U.S.C. § 2320(a), and is therefore subject to forfeiture to the United States pursuant to 18 U.S.C. § 2323. (Doc. 1 at ¶ 1).
More specifically, in December of 2011, the Department of Homeland Security, Immigration and Customs Enforcement ("HSI"), commenced an investigation into the business activities of the Shoe Farm, a business located at 20370 Avenue 232 in Lindsay, California (the "business" or "store"). The investigation revealed that the owners of the Shoe Farm were involved in trafficking and distributing counterfeit goods.
In particular, on January 26, 2012, at approximately 10:10 a.m., a HSI agent acting in an undercover capacity ("UC") entered the Shoe Farm. At approximately 10:20 a.m., the UC exited the Shoe Farm with a white bag containing three NFL jerseys purchased from the business. Agents followed the UC to a location a few miles north of Avenue 204 where the UC gave the purchased merchandise to HSI Special Agent Jose Carlos. On February 1, 2012, HSI agent Carlos emailed photos of the three NFL Jerseys purchased from the Shoe Farm to Senior Brand Protection Manager Jeni Zuercher, from Adidas International Inc. for authentication. On February 16, 2012, HSI agent Carlos received a Federal Express package from Jeni Zuercher. Enclosed was a declaration of determination dated February 14, 2012, stating that the merchandise was counterfeit. This determination was based on the poor stitching and/or embroidery; incorrect and/or missing labels and/or hang-tags; and incorrect construction of the merchandise.
On May 10, 2012 at approximately 1:25 p.m., a UC HSI agent entered the Shoe Farm again. At approximately 1:46 p.m., the UC exited the Shoe Farm with three black bags containing nine NFL jerseys purchased from the store. On May 11, 2012, HSI agent Carlos sent a CD containing photographs of the nine NFL jerseys via Federal Express to Senior Brand Protection Manager Jeni Zuercher from Adidas International Inc. for authentication. On May 18, 2012, HSI agent Carlos received a Federal Express package from Jeni Zuercher. Enclosed was a declaration of determination dated February 14, 2012, stating that the merchandise was counterfeit. This determination was based on the poor stitching and/or embroidery; incorrect and/or missing labels and/or hang-tags; and incorrect construction of the merchandise.
On August 14, 2012, at approximately 9:09 a.m., a UC HSI agent entered the Shoe Farm through the Chevron business located within the same building. The UC exited the business at approximately 9:15 a.m. with one black bag containing merchandise purchased from the Shoe Farm. The UC stated that the Shoe Farm was closed but that the Chevron employee sold the merchandise to the UC utilizing the cash register located on the Shoe Farm side of the building.
On August 15, 2012, HSI agent Carlos sent the Nike NFL Jersey purchased at the Shoe Farm during the above transaction via Federal Express to Lori Colbert, North America Brand Protection Manager for Nike for authentication. On August 21, 2012, HSI agent Carlos received a UPS package from Lori Colbert. Enclosed was the jersey sent for authentication and an affidavit dated August 16, 2012, stating that the merchandise was counterfeit. This determination was based on the use of incorrect jersey material; incorrect Jock Tag material; a hang tag missing UPC sticker; incorrect mylar thread material; and a missing care and content label.
As a result of the above, on August 29, 2012, agents with HSI obtained and executed a federal search warrant at the Shoe Farm located at 20370 Avenue 232 in Lindsay, California. During the search of the business, agents located and seized 295 NFL jerseys bearing the Reebok trademark logo, 19 NFL jerseys bearing the Nike trademark logo, and 21 NFL jerseys bearing the Mitchell & Ness trademark logo.
Interview of Sami Ali Muthana
Utilizing his California Driver's License, agents identified one of the employees as Sami Ali Muthana (hereafter "Sami"). Sami was subsequently read his Miranda rights. He waived his rights verbally and in writing, and agreed to speak with agents.
During the post Miranda interview with Sami, he admitted that he was 33% owner of the Chevron and the Shoe Farm (both businesses are located in the same building). Sami advised agents that the other owners of the business were Muneer Muqbel Saeed and Saleh Muqbel Saeed, each with a 33% ownership. When asked about the Shoe Farm, Sami advised that Saleh Muqbel Saeed took care of the Shoe Farm. Sami advised that Saleh Muqbel Saeed utilizes a van to bring merchandise from the Los Angeles area which he orders via the internet. Sami stated that Saleh Muqbel Saeed lives in Porterville and generally travels once or twice a month to Los Angeles to pick up merchandise, depending on how busy the Shoe Farm is.
Interview of Christian Elizabeth Chavez
Agents then made contact with another employee of Shoe Farm who was identified at Christina Elizabeth Chavez (hereafter "Christina") and advised her of her Miranda rights. Christina agreed to speak with agents. Christina stated that she had been working at the Shoe Farm off and on since 2008, and that her main duties included running the cash register and cleaning the store. Christian stated that Saleh Muqbel Saeed ordered the merchandise for Shoe Farm and that when merchandise would arrive via United Parcel Services (UPS), the parcels were addressed to Saleh Muqbel Saeed. Christina stated that the deliveries occurred once a week and sometimes once every two weeks.
When asked the price of the jerseys, Christina stated that the Reebok Jerseys sold for $69.00 and the Nike jerseys sold for $89.00. Christina also advised that Saleh Muqbel Saeed was the manager and owner of Shoe Farm and that on average ...