United States District Court, E.D. California
FINDINGS & RECOMMENDATIONS
CAROLYN K. DELANEY UNITED STATES MAGISTRATE JUDGE
I.
Introduction
This
case was referred to the undersigned pursuant to Local Rule
302(c)(19) and 28 U.S.C. § 636(b)(1). This is a civil
forfeiture action against real property located at 6199
Highway 26, Valley Springs, California, Calaveras County,
APN: 073-013-005-000, including all appurtenances and
improvements thereto (hereafter referred to as
“defendant real property”).[1]Plaintiff United
States of America (“Government”) seeks default
judgment against the interest of Xiulan Yang
(“Yang”). Plaintiff seeks entry of a final
judgment of forfeiture that vests in the Government all
right, title, and interest in defendant real property.
The
Government's motion for entry of default judgment (ECF
No. 90) came on regularly for hearing on October 9, 2019.
Assistant United States Attorney Kevin Khasigian appeared at
the hearing on behalf of the Government. Michael Gilligan,
counsel for defendant Signet Management, LLC, appeared
telephonically. Yang did not appear at the hearing.
Upon
review of the motion, supporting documents, and the oral
representations of the Government at the hearing, and good
cause appearing, the court now issues the following findings
and recommendations.
II.
Background
This
case is proceeding on the Verified Complaint for Forfeiture
in Rem (“complaint”) filed April 3, 2018. (ECF
No. 1.) The complaint makes the following factual
allegations:
In
2016, law enforcement identified Leonard Yang as a
participant in a large-scale residential marijuana operation
in Sacramento County that involved seven Sacramento
residences. (ECF No. 1 at ¶ 11.) Each residential
property connected to the criminal organization consumed an
unusually large amount of electricity and the properties were
purchased with hard-money financing and thousands of dollars
wired to the United States from China. (Id.) In
September 2016, law enforcement executed federal search
warrants at the seven residences and seized more than 5, 000
marijuana plants. (Id. at ¶ 12.) In September
2016, Leonard Yang and three co-conspirators were indicted.
(Id. at ¶ 13.)
In
2017, law enforcement identified Xiu Ping Li and others as
participants in a large-scale marijuana cultivation and
trafficking organization, and identified nine properties
connected to their illegal activities. (Id. at
¶ 14.) Federal search warrants were executed at the nine
properties in July 2017. (Id. at ¶ 15.) In
September 2017, Xiu Ping Li was indicted along with several
other individuals. (Id. at ¶ 17.)
Following
these federal investigations and indictments, state and local
authorities searched a number of additional properties that
were identified by the investigations as potentially tied to
the organization under federal examination. (Id. at
¶ 18.) Ultimately, in 2017 and 2018, law enforcement
executed search warrants at twelve properties in Calaveras
County, including the defendant real property, and seized
approximately 9, 711 marijuana plants and over 100 pounds of
processed marijuana. (Id. at ¶¶ 18-21,
30.) Regarding the defendant real property, on January 11,
2018, law enforcement executed a state search warrant at the
property and found an active marijuana grow that contained 1,
346 marijuana plants. (Id. at ¶ 30.) Yang, a
resident of Pittsburgh, Pennsylvania, is the listed owner of
the defendant real property and purchased the property for
$360, 000 in June 2017. (Id.)
The
verified complaint alleges that defendant real property was
used or intended to be used, to commit or to facilitate the
commission of, a violation of 21 U.S.C. §§ 841, et
seq. (prohibiting the manufacture, distribution, dispensing
or possessing of a controlled or counterfeit substance), an
offense punishable by more than one year's imprisonment,
and therefore subject to forfeiture pursuant to 21 U.S.C.
§§ 881(a)(6)-(7). (Id. at ¶¶
34-35, 37.)
Pursuant
to order of this court filed April 12, 2018, notice of this
action was published on the official internet government
forfeiture site <www.forfeiture.gov> and ran for at
least thirty consecutive days, as required by Rule
G(4)(a)(iv)(C) of the Supplemental Rules of Admiralty or
Maritime Claims and Asset Forfeiture Actions. (ECF Nos. 3
(Order) and 19 (Declaration of Publication).)
The
U.S. Marshals Service posted defendant property with the
verified complaint and notice of complaint on April 27, 2018.
(ECF No. 90-2 at ¶ 8; id. at 21.) On April 5,
2018, the Government recorded a Lis Pendens (Notice of
Pending Action) against defendant real property with the
Calaveras County Recorder. (ECF No. 12.)
On May
31, 2018, the U.S. Marshals Service attempted unsuccessfully
to personally serve the complaint and related documents upon
Yang at his last known address. (ECF No. 90-2 at ¶ 6,
Ex. B.) Personal service upon Yang was again attempted on
June 8 and June 18, 2018; the documents were left at the
residence on June 18, 2018. (Id.; see also
ECF No. 63.) On April 23, 2018, copies of the complaint and
related documents were sent by certified mail to Yang to his
last ...