Second Circuit – Forfeiture: United States v. Swartz Family Trust

United States Court of Appeals for the Second Circuit

Forfeiture

Time-barred – Bona fide purchaser for value

United States v. Swartz Family Trust

19-2822(L)

Judges Calabresi, Lynch, and Lohier

Background: The claimants-appellants filed third-party petitions asserting an interest in property that was forfeited to the government following a conviction of wire fraud and tax evasion. The petitioners were dismissed on the basis that the claimant-appellant’s petition was not submitted before the 30-day deadline to file such petitions expired and that one such claimant failed to state a claim under the forfeiture statute, as either the holder of an interest superior to the government or as a bona fide purchaser for value.

Ruling: The Second Circuit affirmed in part and vacated in part. The court held that the trust’s petition was correctly dismissed as timely. However, the court erred for failing to consider the claimant’s motion for leave to amend its petition with respect to its claim that it is a bona fide purchaser for value.

Elissa Hart-Mahan for the appellee; Steven L. Kessler and Scott M. Kessler for the claimants-appellants.

Oral argument audio