
USCA1 Opinion

	




          March 29, 1996                                [NOT FOR PUBLICATION]                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 95-1923        No. 95-2016                              UNITED STATES OF AMERICA,                                 Plaintiff, Appellee,                                          v.             ALL FUNDS, MONIES, SECURITIES, MUTUAL FUND SHARES AND STOCKS                        HELD IN FIDELITY INVESTMENTS, ET AL.,                                 Defendant, Appellee.                                                                                      __________                               THOMAS E. KNEELAND, JR.,                                Defendant, Appellant.                                 ____________________                    APPEALS FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                     [Hon. William G. Young, U.S. District Judge]                                             ___________________                                 ____________________                                        Before                                Torruella, Chief Judge,                                           ___________                           Stahl and Lynch, Circuit Judges.                                            ______________                                 ____________________            Thomas E. Kneeland, Jr. on brief pro se.            _______________________            Donald K. Stern,  United States Attorney, and Patrick M. Hamilton,            _______________                               ___________________        Assistant United States Attorney, on brief for appellee, United States        of America.                                 ____________________                                 ____________________                 Per  Curiam.    These  consolidated appeals  have  their                 ___________            origin  in  a civil  forfeiture  action  which was  dismissed            without prejudice,  on the government's  motion, pursuant  to            Fed.  R.   Civ.  P.  41(a)(2).     Claimant  Thomas  Kneeland            challenges the dismissal; the denial of various pre-dismissal            motions, including his requests for an adversarial hearing or            entry of judgment  in his  favor; and the  denial of  various            post-dismissal  motions,  including  a  renewed   motion  for            summary judgment, a motion  for return of property, a  motion            to disqualify the district  judge, and a motion  for judgment            on the pleadings.1  For the following reasons, we affirm.                             1                 Kneeland  allegedly  operated   an  advance  fee  scheme            whereby he fraudulently promised  potential borrowers that he            could obtain funding for their projects, accepted substantial            up-front  fees, failed to arrange financing  or to return the            fees, and subsequently  "laundered" the fees.  On December 2,            1993, the  government received ex  parte warrants authorizing                                           __  _____            seizure of the defendant properties after persuading a United            States  Magistrate Judge  that  there was  probable cause  to                                            ____________________               1The  parties  dispute  the  scope  of  our  jurisdiction.               1            Kneeland claims to have appealed eight separate orders by way            of eight notices of  appeal, whereas the government correctly            points out  that Kneeland filed  only two notices  of appeal.            We  need not  resolve  what issues  are  properly before  us.            Assuming without deciding that we have jurisdiction to review            each of the challenged  orders, we would affirm.   See Norton                                                               ___ ______            v.  Matthews, 427  U.S. 524,  530-32 (1976)  (explaining that                ________            jurisdictional inquiry  may be  bypassed where merits  can be            easily   resolved   in  favor   of   the  party   challenging            jurisdiction).            believe  that  they were  involved in  or traceable  to money            laundering.      Thereafter,    the   government    initiated            administrative forfeiture  proceedings and   Kneeland filed a            claim of ownership.  On March 30, 1994, a federal  grand jury            returned an  indictment  charging Kneeland  with  conspiracy,            mail  fraud,  wire  fraud,   money  laundering  and  criminal            forfeiture.  The forfeiture count specifically identified the            defendant properties.  On May  6, 1994, the government  filed            the  instant civil  complaint for  forfeiture pursuant  to 18            U.S.C.   981(a)(1)(A).                   For a  period  of time,  the  civil and  criminal  cases            progressed forward in tandem.   The criminal case readied for            trial.   In the civil case,  Kneeland filed an  answer to the            complaint.  Back Bay,  Ltd., an alleged victim, filed  a late            claim.  On October 20, 1994, less than three weeks before the            criminal trial  was scheduled  to take place,  the government            moved  to  stay  discovery  in  the  civil case  pending  the            disposition of  the criminal matter.  Kneeland did not object            to this request,  and it  was allowed.   The criminal  trial,            however, was  delayed, and  eventually it was  rescheduled to            take place on May 22, 1995.                   On December  27, 1994,  while  the stay  was in  effect,            Kneeland  filed a motion for summary judgment in his favor on            the alleged  ground that he was the only person to "perfect a            claim" to the defendant properties.  The motion was summarily                                         -3-            denied.    Thereafter, Kneeland  moved to  lift the  stay and            renewed  his motion for summary judgment.  These motions were            denied.  On April 24, 1995,  Kneeland again moved to lift the            stay, this time  requesting a  hearing on the  merits of  the            seizure.  This motion was  followed by similar motions, filed            approximately every  two or three days,  seeking, inter alia,                                                              _____ ____            dismissal  of  the  complaint,  an  adversarial  hearing,  or            summary judgment.    On June  20,  1995, the  district  court            granted  Kneeland's motion  to lift  the stay,  but otherwise            denied his various motions.  By that time, the criminal trial            had been delayed once again.                   The government immediately filed a motion to dismiss the            civil case without prejudice.  On or about the same date, the            government  moved  in  the  criminal case  for  new  warrants            freezing  the  defendant  properties.     Kneeland  filed  an            "omnibus" motion objecting to the dismissal and seeking entry            of judgment  in his favor.   A week later, he  filed a motion            for  adversarial hearing or entry  of judgment.   On July 18,            1995, the district  court allowed the  motion to dismiss  and            denied the "omnibus"  motion.   On July 20,  1995, the  court            denied  the  motion  for  adversarial  hearing  or  entry  of            judgment.  Thereafter, Kneeland filed, inter  alia, a renewed                                                   _____  ____            motion for summary judgment, a motion for return of defendant            properties,  a   motion  to  vacate  the   dismissal  and  to                                         -4-            disqualify the district judge under 28 U.S.C.   455(a), and a            motion for judgmenton thepleadings.  Thesemotions weredenied.                 A  plaintiff's motion  for  dismissal without  prejudice            pursuant to Fed. R. Civ. P. 41(a)(2) should be allowed unless            the court  finds that the  defendant will suffer  plain legal            prejudice.  9 Charles  A. Wright & Arthur R.  Miller, Federal                                                                  _______            Practice  & Procedure    2364,  at  280 (2d  ed. 1994).   The            _____________________            decision whether or not  to grant such a dismissal  is within            the  sound discretion  of the  district court  and reviewable            only  for  abuse of  discretion.   See  Puerto  Rico Maritime                                               ___  _____________________            Shipping Authority v. Leith, 668 F.2d 46, 49 (1st Cir. 1981).            __________________    _____            We find no such abuse of discretion here.                 As an  initial matter,  we reject  Kneeland's suggestion            that he was robbed of an imminent victory.  See Grover v. Eli                                                        ___ ______    ___            Lilly & Co.,  33 F.3d  716, 718-19 (6th  Cir. 1994)  (finding            ___________            abuse of  discretion where  district court dismissed  case at            the point where  the law  clearly dictated a  result for  the            defendant).  Indeed, Kneeland's argument that he was entitled            to judgment in  his favor  because the government  is a  mere            "escrow agent"  for potential claimants is  utterly frivolous            even  if  we  assume  arguendo that  Kneeland  was  the  only                                  ________            claimant.  The government in a civil forfeiture action  under            the  money laundering  statutes is  not an  escrow agent  for            others;  rather,  if successful,  it  acquires  title to  the            forfeited property.  See 18 U.S.C.   981(a),(f).                                   ___                                         -5-                 We also reject Kneeland's  argument that he was deprived            of  his right to  an adversarial hearing.   Certainly, before            forfeiture,  a claimant  must be  afforded an  opportunity to            rebut the government's showing  of probable cause, see United                                                               ___ ______            States  v. Real Property Known  & Numbered as  Rural Route 1,            ______     __________________________________________________            Box 137-B, Cutler, Ohio, 24 F.3d 845, 848-49 (6th Cir. 1994),            _______________________            as well  as to  present evidence  bearing on other  potential            defenses. However, it doesn't  follow that a civil forfeiture            action, once begun, may not be aborted.  In the instant case,            the dismissal obviated the need for a hearing.2                                                          2                 Finally, we add  that the  civil case was  still in  the            pre-discovery  stage.    Although  Kneeland  claims  to  have            devoted  many hours to the case, the record reveals that much            of his efforts were  spent on frivolous, repetitious motions.            Kneeland had gained no ground in the civil case which he lost            by the dismissal.  Indeed, Kneeland benefited from not having            to  litigate two  actions  simultaneously, and  from  certain            procedural advantages he had in the criminal proceeding.  See                                                                      ___            David B. Smith, Prosecution  & Defense of Forfeiture  Cases                              ___________________________________________            1.03   (1995)  (discussing,   by  contrast,   the  tremendous            procedural  advantages  the  government  enjoys  in  a  civil                                            ____________________               2Kneeland's  suggestion  that he  was  denied  due process               2            because he  was not afforded a  "timely" post-seizure hearing            also  fails.   Kneeland  did not  object to  the government's            motion  for a  stay; and while  the stay  was in  effect, the            government   diligently   prosecuted  the   related  criminal            indictment.                                          -6-            forfeiture  action).    The  criminal case  was  procedurally            advanced and  the  government ready  for  trial.   Under  the            circumstances, we  think the district  court properly allowed            the government's motion to dismiss the civil case.                   We  have  carefully   considered  Kneeland's   remaining            arguments  and reject them as without  merit.  In particular,            we find no error  in the denial of his  post-dismissal motion            for  return of property since the assets were then being held            in  connection  with his  criminal case.3    We also  find no                                                    3            error  in the denial of the motion for disqualification.  The            district court's comments  in its order vacating the  stay do            not  warrant an inference that it stepped outside its role to            act as  adviser to the government, and we find no evidence of            bias in  any of the court's rulings or in its handling of the            case.   See Liteky  v.  United States, 114 S.  Ct. 1147, 1157                    ___ ______      _____________            (1994)  (observing that judicial  rulings alone  almost never            constitute valid basis for a bias or partiality motion).                 Affirmed.                 _________                                            ____________________               3Contrary  to Kneeland's suggestion,  there is no evidence               3            that  the district  court  held a  "transfer hearing"  or was            otherwise  involved  in the  decision  to  issue new  seizure            warrants.                                         -7-
