Arwady v. Ho ( 2021 )

Case: 20-20403 Document: 00515892844 Page: 1 Date Filed: 06/09/2021
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
June 9, 2021
No. 20-20403 Lyle W. Cayce
Clerk
Robert G. Arwady; Samuelia D. Arwady,
Plaintiffs—Appellants,
versus
Tommy Ho; Jane Doe Ho; United States of America,
Defendants—Appellees.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:17-CV-3195
Before Wiener, Elrod, and Higginson, Circuit Judges.
Per Curiam:*
Robert and Samuelia Arwady appeal the dismissal of their Fourth
Amendment false-arrest claim against Tommy Ho and their Federal Tort
Claims Act negligence claim against the United States. Because Mr. and
Mrs. Arwady fail to state a false-arrest claim, and because the United States
has sovereign immunity on their negligence claim, we AFFIRM.
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 20-20403 Document: 00515892844 Page: 2 Date Filed: 06/09/2021
No. 20-20403
I.
Until 2006, Robert Arwady sold firearms through his business
Arwady Hand Truck Sales, a federally licensed firearms dealer. The Bureau
of Alcohol, Tobacco, Firearms and Explosives revoked Arwady Hand Truck
Sales’s license in 2006. In 2007, Mr. Arwady transferred the remaining
inventory of firearms to himself. Mr. Arwady then began selling those
firearms by arranging deals for each sale through other federally licensed
firearms dealers. Mr. Arwady would transfer his firearm to a dealer, and the
dealer would then sell the firearm to the ultimate buyer.
In 2009, ATF began investigating Mr. Arwady for these sales. It
attempted to purchase a firearm directly from him through a controlled
purchase by an undercover officer. Mr. Arwady refused to sell directly to the
undercover officer.
Tommy Ho, an agent for ATF, obtained a search warrant from
Magistrate Judge Calvin Botley. When agents executed the warrant, they
recovered business records and 165 firearms.
At some point after the seizure, the government initiated a civil
forfeiture case against those firearms. The district court ultimately dismissed
the case in October 2012 because it had “been pending for almost three
years,” and “because the government intend[ed] to seek an indictment that
would include forfeiture counts identical to the civil forfeiture claims in this
action.” Order, United States v. 165 Firearms, No. 4:09-CV-3622 (S.D. Tex.
Oct. 5, 2012), ECF No. 63.
On February 27, 2014, a grand jury indicted Mr. Arwady on eight
counts related to the sales of firearms he conducted after Arwady Hand
Truck Sales lost its license. United States Marshals arrested Mr. Arwady on
March 6, 2014. Mr. Arwady pleaded not guilty to a superseding indictment.
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The United States subsequently dismissed six of the counts. Mr. Arwady
was found not guilty on the remaining two counts on October 21, 2015.
In two installments over the next five months, the government
returned 160 of the 165 firearms it had seized from Mr. Arwady. Many of the
firearms were damaged or missing parts and accessories. The firearms that
had been “new in the box” had been removed from their original boxes.
Mr. and Mrs. Arwady filed a pro se civil complaint against Agent Ho
and the United States. 1 After Mr. and Mrs. Arwady obtained counsel, they
amended their complaint, asserting Fourth Amendment claims against Agent
Ho and various Federal Tort Claims Act claims against the United States.
The district court dismissed Mr. and Mrs. Arwady’s amended complaint,
concluding that the Fourth Amendment and most of the Federal Tort Claims
Act claims were time-barred. The district court also concluded that Mr. and
Mrs. Arwady failed to state a claim against the United States for damage to
Mr. Arwady’s firearms, but it allowed Mr. and Mrs. Arwady to amend their
complaint once more as to that claim only.
Mr. and Mrs. Arwady filed a second amended complaint naming only
the United States as a defendant and stating a single Federal Tort Claims Act
claim for negligence in storing and handling Mr. Arwady’s firearms. The
district court dismissed that claim as barred by sovereign immunity. The
district court also reconsidered its basis for dismissing Mr. and Mrs.
Arwady’s Fourth Amendment claims, but once more dismissed the claims as
time-barred.
1
The complaint also named a Jane Doe Ho, who was alleged to be the unidentified
wife of Agent Ho. The Jane Doe was never identified.
3
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II.
Mr. and Mrs. Arwady timely appealed the districts court’s 12(b)(6)
dismissal of: (1) their Fourth Amendment claim for the false arrest of Mr.
Arwady against Agent Ho; and (2) their Federal Tort Claims Act claim
against the United States for negligently damaging Mr. Arwady’s firearms.
See Fed. R. Civ. P. 12(b)(6). We review orders to dismiss for failure to state
a claim de novo. Arnold v. Williams, 979 F.3d 262, 266 (5th Cir. 2020).
A.
As to the Fourth Amendment false-arrest claim, both parties agree
that the district court erred by dismissing it as time-barred. Because the
statute of limitations would otherwise have expired on a Saturday, Mr. and
Mrs. Arwady’s complaint was timely filed on the subsequent Monday. Fed.
R. Civ. P. 6(a)(1)(C). Nevertheless, because it is clear from the face of Mr.
and Mrs. Arwady’s complaint that they failed to state a claim, we affirm
dismissal on that ground. 2 See Club Retro, L.L.C. v. Hilton, 568 F.3d 181, 208
(5th Cir. 2009); T. B. by and through Bell v. N.W. Indep. Sch. Dist., 980 F.3d
1047, 1050 n.2 (5th Cir. 2020) (“[W]e may ‘affirm the district court’s
judgment on any grounds supported by the record.’” (quoting United States
ex rel. Farmer v. City of Houston, 523 F.3d 333, 338 n.8 (5th Cir. 2008))).
In their false-arrest claim, Mr. and Mrs. Arwady allege that Agent Ho
omitted key statements from his application for a search warrant in 2009
2
After the district court allowed Mr. and Mrs. Arwady to file a second amended
complaint to restate their negligence claim against the United States, they did not reassert
their Fourth Amendment claims or even name Agent Ho as a defendant. Thus, there is a
real question whether there is any live Fourth Amendment claim remaining at this point in
the proceedings. See Bosarge v. Mississippi Bureau of Narcotics, 796 F.3d 435, 440 (5th Cir.
2015) (citing King v. Dogan, 31 F.3d 344, 346 (5th Cir. 1994)). Regardless of the answer to
that question, we affirm the dismissal for the reasons stated herein.
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leading to Mr. Arwady’s arrest by U.S. Marshals in 2014. Mr. and Mrs.
Arwady’s complaint does not address the five-year gap between Agent Ho’s
alleged omission and Mr. Arwady’s arrest. Further, Mr. and Mrs. Arwady
acknowledge in their complaint that the search warrant was approved by a
magistrate judge. Mr. and Mrs. Arwady cannot overcome our precedent
compelling the conclusion that “facts supporting [Arwady’s] arrest [we]re
placed before an independent intermediary”—the magistrate judge
authorizing the initial search—“break[ing] [any] chain of causation for false
arrest” traceable to Agent Ho. McLin v. Ard, 866 F.3d 682, 689 (5th Cir.
2017) (quoting Deville v. Marcantel, 567 F.3d 156, 170 (5th Cir. 2009)).
Moreover, despite Mr. and Mrs. Arwady’s contention that Bivens v. Six
Unknown Named Agents, 403 U.S. 388 (1971), authorizes their claim against
agent Ho, we have already rejected the proposition that Bivens authorizes
carte blanche Fourth Amendment claims for “seizures without legal process
[or] . . . with wrongful legal process.” Cantú v. Moody, 933 F.3d 414, 423 (5th
Cir. 2019), cert. denied. 141 S. Ct. 112 (2020). Mr. and Mrs. Arwady’s
allegations against Agent Ho simply do not “state a claim upon which relief
can be granted.” See Fed. R. Civ. P. 12(b)(6).
B.
Mr. and Mrs. Arwady’s remaining Federal Tort Claims Act claim
against the United States fares no better. The Act waives the United States’
sovereign immunity for specified claims. 28 U.S.C. § 1346(b)(1). It does not,
however, waive sovereign immunity for claims relating to “the detention of
any goods” by any “law enforcement officer” unless one of four conditions
is met, including that “the property was seized for the purpose of forfeiture
under any provision of Federal law providing for the forfeiture of property
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other than as a sentence imposed upon conviction of a criminal offense.” 3 Id.§ 2680(c)(1).
Here, officers from ATF retained 165 of Mr. Arwady’s firearms. See
id. § 2680(c). Those firearms were seized according to a search warrant
issued by a magistrate judge in connection with the investigation of a possible
violation of the federal Gun Control Act. See 18 U.S.C. §§ 921–31. Mr. and
Mrs. Arwady include both the search warrant and the investigation in their
amended and second amended complaints.
Despite the search warrant and investigation, Mr. and Mrs. Arwady
allege that “[t]he firearms were seized for civil forfeiture.” “While the court
must accept the facts in the complaint as true, it will ‘not accept as true
conclusory allegations, unwarranted factual inferences, or legal
conclusions.’” Arnold, 979 F.3d at 266 (quoting Gentilello v. Rege, 627 F.3d
540, 544 (5th Cir. 2010)). In a conclusory allegation, Mr. and Mrs. Arwady
ask us to overlook both the search warrant and the criminal investigation that
were the reasons for the seizure of Mr. Arwady’s firearms and instead accept
that the seizure was really “for the purpose of forfeiture.” Although Mr. and
Mrs. Arwady point to a subsequent civil forfeiture action against the firearms,
they do not allege how this after-the-fact civil action was the purpose of the
seizure. This is true whether forfeiture must be the sole purpose or merely
one of the purposes of the seizure to satisfy § 2680(c)(1). Mr. and Mrs.
Arwady urge us to adopt the latter interpretation of the statute, while the
government urges us to adopt the former, citing to four of our sister circuits
for support. 4 We need not reach this question of statutory interpretation
3
Mr. and Mrs. Arwady have not argued that any of the other four conditions is
relevant to their claim.
4
See Foster v. United States, 522 F.3d 1071, 1075 (9th Cir. 2008); Smoke Shop,
L.L.C. v. United States, 761 F.3d 779, 786 (7th Cir. 2014); Shigemura v. United States, 504
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because, as explained above, Mr. and Mrs. Arwady have not plausibly alleged
how the forfeiture action was even one of the purposes of the seizure of their
firearms.
Simply put, Mr. and Mrs. Arwady have not plausibly alleged facts that
would support a waiver of sovereign immunity under 28 U.S.C. § 2680(c)(1).
See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (holding that “a complaint
must contain sufficient factual matter, accepted as true” to state a plausible
claim to relief).
* * *
For the reasons set forth above, the judgment of the district court is
AFFIRMED.
F. App’x 678, 680 (10th Cir. 2012); Bowens v. U.S. Dep’t of Just., 415 F. App’x 340, 343
(3d Cir. 2011).
7