Nevada Civil Forfeiture

Stephen Is A Veteran Dedicated To Providing For His Daughters

 Stephen sacrificed for his country, serving over 16 years in the Marines, including tours in Iraq and Afghanistan. He has two teenage daughters, who live with his ex-wife (also a former Marine) in a small California town near Reno. Until shortly before his money was seized, Stephen lived nearby and worked as a systems administrator at a local hospital. But he was laid off during the pandemic, and he moved to Lubbock, Texas, where his ex-wife then intended to move with their daughters. In Lubbock, he lived with his parents while searching for a house to buy with room for his daughters.

Stephen returned to California monthly to visit his daughters. In February 2021, he was preparing for his monthly trip when he discovered that one of the wheels on his car was cracked. He rented a car and put the wheel in the trunk of the rental to have it fixed at a shop he knew along the way in Sparks, Nevada.

Stephen has always saved his money in cash. All his income goes through the bank, but he took out the money he wanted to save and kept it with him as cash. On this trip to California, Stephen took his savings with him because, recently, there had been a spate of property crimes in his parents’ neighborhood, and his parents intended to be away from home for part of Stephen’s trip.

Stephen Is Pulled Over By The Nevada Highway Patrol, Which Takes His Life Savings To Give To The DEA

Stephen’s drive was uneventful until he approached Reno. He passed two Nevada Highway Patrol vehicles in the median. For no apparent reason, one started following him. Based on footage later obtained through a public-records request, the officer orchestrated a reason to pull him over: He followed Stephen until he was forced to maneuver around a tanker truck, at which point the officer says, “that’s it.” Shortly after, he pulled Stephen over.

After complimenting Stephen for driving “great,” the officer told him he had made an unsafe lane change too close to a tanker truck, and the officer asked Stephen to get out of the vehicle. Stephen was helpful. He answered all of the officer’s questions about his trip and even volunteered that his life savings was in the car. More officers arrived. They searched the vehicle with Stephen’s permission. No drugs, weapons, or anything illegal was found. The officers were suspicious of the tire in the trunk, but after carefully inspecting it they determined there was nothing hidden inside. In a backpack, they found Stephen’s cash in a plastic bag, just where he told them it would be, with receipts showing two years’ worth of bank withdrawals.

At this point, the officer who initiated the stop privately told the others that Stephen should be allowed to go. He did not think there was enough evidence connecting his money to criminal activity. A DEA agent was called to the scene, but that agent radioed he could not make it. A Nevada Highway Patrol sergeant arrived and had Stephen’s money placed in a nearby field where a drug dog found it and allegedly alerted.

The sergeant then ordered the seizure of the money specifically so it could be turned over to the DEA. Stephen was told the seizure was necessary because of the combination of a dog alert, large amount of money, and the “suspicious” spare tire. At Stephen’s urging, the officers inspected his ATM receipts and even took pictures. Although no DEA agent was present, Stephen was given a receipt with the phone number of the DEA agent in charge. Stunned at what had just happened, Stephen was told he was free to go.

The Government Treats Stephen Like A Criminal But Then Breaks The Law Itself

Stephen called the DEA agent listed on the receipt, assuming that there must have been some mistake and that he could clear up the situation over the phone. Instead, the agent treated Stephen like a criminal. Stephen ended the conversation, and when he received a formal notice from DEA explaining that they intended to use civil forfeiture to take his money permanently, he promptly filed a claim to his own life savings.

Even that is further than many people get. The civil forfeiture process is so confusing and difficult to navigate without hiring a lawyer (at a cost often greater than the amount being forfeited) that the vast majority of people do not even make into court, instead losing their property through “administrative forfeiture.” When property owners manage to make it into court, the government again counts on the cost and confusion of the process to ensure that most forfeitures will become permanent without the government having to prove its case. And in the rare cases where people do get their property back, they receive no compensation for the stress and financial difficulties that come with having one’s property seized for the better part of a year or longer. That is why completely innocent people like Stephen so often are victimized by the civil forfeiture process. It isn’t built to get at the truth; it is built to make it easy for the government to take people’s property.

But, with help from the pro bono attorneys at the Institute for Justice, Stephen checked all the right boxes. He filed a formal claim to his property, under penalty of perjury, putting the burden on the government to come forward with evidence that he did something wrong that connected his money to a crime. Under the federal law that governs civil forfeiture, the Civil Asset Forfeiture Reform Act of 2000 (CAFRA), Stephen’s claim should have started a strict 90-day clock for the government either to return his property or file a case in federal court stating the basis for the government’s belief that Stephen and his money were connected to criminal activity. The DEA instead did nothing. More than six months after his money was unceremoniously seized on the side of the highway, Stephen had heard nothing from the DEA. The government simply ignored their deadline, broke the law and took no steps on its own to return Stephen’s property.

Unfortunately, Stephen is not the first innocent person to have found himself in this situation. Although CAFRA says that the government cannot forfeit property once the deadline expires, there are no real consequences when the government breaks the law. Faced with an incentive to take property in the first place, and facing no consequences for illegally keeping it, government agencies are in no rush to return property. Someone in Stephen’s position, having his life savings taken from him for over six months, must either wait months or years for the government to get around to returning the property or hire a lawyer to file a lawsuit insisting the government follow its own rules.

Average citizens are held to a much higher standard. If Stephen had not complied with CAFRA deadlines and DEA’s demands for information, his money would have been forfeited automatically. But when the government ignores the deadlines, it takes a team of lawyers to get the property back.

Stephen’s money was only returned after he filed a lawsuit against the DEA in federal court to force the government to follow its own rules. When the case generated national media coverage and public outrage, the government finally returned his money. In fact, the government threw in the towel just a day after Stephen and the Institute for Justice filed suit, demonstrating that it had no basis for holding Stephen’s life savings for the prior six months.

Federal “Equitable Sharing” Pays State Officers To Break Their Own States’ Laws

As frustrating as it is that federal agencies ignore CAFRA’s deadlines, even more troubling are the perverse financial incentives that drove the Nevada Highway Patrol officers to take Stephen’s money in the first place. Through a federal program called “equitable sharing,” state law enforcement officers can seize property under state law and hand it over to the federal government for forfeiture under federal law. The federal government does all the work, and if it successfully forfeits the property, 80 percent of the profits are returned to the state agency who took the property as a kind of finder’s fee.

As this case demonstrates, state police make use of equitable sharing, and make big money, based on the flimsiest of evidence. The unlucky property owner must find a lawyer to fight back, all while his life savings remain in government custody. Meanwhile, the state agency that seized the property does nothing other than wait for payday. The equitable sharing program sends hundreds of millions of dollars to state and local agencies every year—more than $333 million in 2019 alone and more than $8.8 billion from 2000 to 2019. With so much money at stake, the federal government has created a powerful incentive for state and local law enforcement to search for profit instead of searching for criminals.

Stephen’s case is one more troubling example. Nevada law provides constitutional protections against unreasonable seizures and excessive fines. Although it allows civil forfeiture, it places a higher burden on the government to forfeit property than does federal law, and it does not contemplate that state law enforcement agents will just hand the money over to a federal agency just to make money. Even though the officer who pulled Stephen over knew there was no evidence of criminal activity (which can be heard clearly on the body cam footage), the pull of equitable sharing was so strong that it still led the Highway Patrol to seize an innocent man’s cash, ignoring both Stephen’s constitutional rights and the requirements of Nevada law.

Seizures like this happen all around the country, all the time.

The Legal Claims

Under CAFRA, once a person has made a claim to his seized property, the government has a 90-day deadline to initiate civil or criminal proceedings. If it does not do so, it must “promptly” return the property. ¹  Here, the government’s deadline expired in July 2021, and Stephen still did not have his money back. Rather than “promptly” returning Stephen’s life savings, the DEA has just kept the money and said nothing. Stephen sued the DEA in federal court under a rule that allowed him to challenge “the deprivation of property.” ²  It was only when facing this federal lawsuit that the government was willing to follow its own rules and return Stephen’s money.

Stephen is also seeking justice against the Nevada Highway Patrol officers who seized his life savings, without any evidence of a connection to criminal activity, just to reap a payday from federal equitable sharing. By seizing property not for public safety, but for their own profit, Nevada police violated the Nevada Constitution. The state’s due process protections prohibit the government from having improper financial motivations to seize property. Not only that, but nothing in Nevada law authorizes state law enforcement to participate in federal equitable sharing. As this case shows, the federal government is helping state police avoid state law for profit.

Stephen’s state case demands compensation for the costs he incurred over six months without his life savings. More importantly, Stephen is asking the Nevada courts to block state law enforcement agencies from behaving like this again by ruling that participation in federal equitable sharing violates Nevada law.

The Courts and the Parties

Stephen’s federal motion for the return of his property was in the United States District Court for the District of Nevada, case number  3:21-cv-393. The movant was Stephen Lara, and the defendants were the United States and the DEA, its administrator and the agent listed on the seizure receipt. The case was closed after the DEA finally returned Stephen’s money.

Stephen’s Nevada lawsuit is in the Second Judicial District Court of Nevada, Washoe County, case number CV21-1595.  The plaintiff is Stephen Lara, and the defendants are the State of Nevada, the Department of Public Safety, the colonel of the Highway Patrol and the Highway Patrol sergeant who ordered the seizure.

The Litigation Team

The case is being litigated by Institute for Justice Senior Attorney Wesley Hottot and Attorney Ben Field. Local counsel are Jordan T. Smith and John A. Fortin of Pisanelli Bice PLLC in Las Vegas, Nevada.

About the Institute for Justice

The Institute for Justice is the nation’s leading advocate for private property rights and the abolition of civil forfeiture. IJ is currently litigating a nationwide federal class action against the TSA and the DEA on behalf of travelers who have been unlawfully detained and had their cash seized without probable cause at airports across the country.

IJ regularly comes to the defense of Americans nationwide to fight civil forfeiture, including the owner of a small trucking business who had his cash seized at an airport in Arizona; a nurse traveling to her home country of Nigeria to start a medical clinic for women and children; and a retiree traveling to purchase a home in his native Albania.