In the Matter of Property Seized from Jean Carlos Herrera and Fernando Rodriguez , 912 N.W.2d 454 ( 2018 )

IN THE SUPREME COURT OF IOWA
No. 16–0440
Filed May 25, 2018
IN THE MATTER OF PROPERTY SEIZED FROM JEAN CARLOS
HERRERA AND FERNANDO RODRIGUEZ,
JEAN CARLOS HERRERA and FERNANDO RODRIGUEZ,
Appellants.
On review from the Iowa Court of Appeals.
Appeal from the Iowa District Court for Pottawattamie County,
Gregory W. Steensland, Judge.
Driver and owner of vehicle in civil forfeiture proceeding seek
further review of court of appeals decision affirming in part district court
ruling rejecting driver’s challenges to seizure of cash and denying owner’s
application for attorney’s fees. DECISION OF COURT OF APPEALS
VACATED; DISTRICT COURT JUDGMENT REVERSED; CASE
REMANDED WITH INSTRUCTIONS.
Dean Stowers of Stowers & Sarcone PLC, West Des Moines, for
appellants.
Thomas J. Miller, Attorney General, Bridget A. Chambers,
Assistant Attorney General, Matt Wilber, County Attorney, and Shelly
Sudmann, Assistant County Attorney, for appellee.
2
WATERMAN, Justice.
This appeal from civil forfeiture proceedings presents several
issues: (1) whether invoking the Fifth Amendment privilege against
self-incrimination excuses compliance with statutory pleading
requirements for establishing ownership in cash seized by the State,
including identifying the source of the funds, (2) whether the district
court must decide motions to suppress evidence before adjudicating
forfeiture claims, and (3) whether a claimant is entitled to attorney fees
as a prevailing party under the forfeiture statute when the State
ultimately consented to the return of his or her property without an
adjudication on the merits.
The claimants’ property was seized after a drug interdiction traffic
stop on Interstate 80. No criminal charges were filed, but the State
sought forfeiture of the impounded vehicle and $44,990 discovered in a
hidden compartment after issuance of a search warrant. Claimants’
pleadings seeking return of the cash and vehicle omitted information
required by Iowa Code section 809A.13(4)(d) (2015) but raised
constitutional objections to the validity of the search and the statute’s
disclosure requirements. The district court dismissed the driver’s claims
for noncompliance with the statute’s pleading requirements, and the
State consented to return of the vehicle to the owner after months of
contested litigation. The district court denied the owner’s claim for
attorney fees, and both claimants appealed. We transferred the case to
the court of appeals, which affirmed the district court in part but
remanded for a determination on whether probable cause supported the
forfeiture. We granted the claimants’ application for further review.
For the reasons explained below, we hold that assertion of the Fifth
Amendment privilege against self-incrimination excuses compliance with
3
forfeiture threshold pleading requirements in Iowa Code
section 809A.13(4)(d), such as identifying the source of cash. We
conclude the district court erred by failing to rule on the claimants’
motions to suppress evidence before adjudicating the forfeiture claims
and erred by overruling Fifth Amendment objections to the pleading
requirements. We further hold the vehicle owner was a prevailing party
entitled to recover his reasonable attorney fees under the forfeiture
statute notwithstanding the lack of an adjudication on the merits. We
remand the case with instructions.
I. Background Facts and Proceedings.
On September 12, 2015, Sergeant Kevin Killpack, a motor vehicle
enforcement officer with the Iowa Department of Transportation (IDOT),
was driving east on Interstate 80 when he noticed a westbound 1999
Ford Expedition with New York license plates. He had been trained that
this particular year, make, and model was commonly used for
transporting narcotics and currency. Sergeant Killpack changed
directions and caught up with the Expedition, which he paced at
seventy-four miles per hour in a seventy mile-per-hour zone. He pulled
the vehicle over for speeding.
As Sergeant Killpack walked up to the Expedition, he knelt by the
rear wheel well and looked underneath using his flashlight. He found a
fabricated compartment attached below the rear cargo area. While the
rest of the undercarriage was rusty, this aftermarket alteration looked
new. Sergeant Killpack asked for registration, insurance, and the
driver’s licenses of the driver, Jean Carlos Herrera, and the passenger,
Bryan Riccaldo. Sergeant Killpack asked Herrera to accompany him to
his patrol car, and Herrera complied. Sergeant Killpack noted that
neither Herrera nor Riccaldo was the registered owner of the Expedition.
4
When he asked Herrera who owned it, Herrera said it was a friend of his
family but he only knew the owner’s first name, Fernando.
Further inquiries raised discrepancies in the stories offered by the
Expedition’s driver and passenger. Herrera told Sergeant Killpack that
he and Riccaldo were traveling from New York to Los Angeles to attend a
trade show to promote their screen printing business. Herrera said that
he had been in business with Riccaldo for two years, yet he was unable
to name the business. Herrera claimed that the trade show, called
“Agenda,” started in two weeks, but Sergeant Killpack performed a
Google search without finding that trade show. He so informed Herrera,
who began to search for the event through his smartphone. Herrera then
changed his story, claiming that the trade show was called “The Venue”
and would take place a month later.
Sergeant Killpack spoke with Riccaldo separately. He asked
Riccaldo if the men were going to a trade show; Riccaldo said no.
Instead, Riccaldo said they were traveling to Los Angeles to visit family
and to deliver the ice cream machine to a man named “Bogar.”
Sergeant Killpack issued Herrera a warning for speeding and
explained that he was free to leave once the citation was printed. But as
Herrera opened the door to get out of the police car, Sergeant Killpack
asked if he could ask Herrera more questions. Herrera said yes.
Sergeant Killpack explained that the two men had given different stories
about their trip and that he was concerned that they were involved in
transporting narcotics. Sergeant Killpack asked Herrera to consent to a
search of the vehicle for narcotics and large sums of money; Herrera
refused. Sergeant Killpack explained that he felt he had enough
reasonable articulable suspicion to perform a “K-9 free air sniff.” The
trained police dog was already at the scene and alerted to the odor of
5
narcotics. Sergeant Killpack and two Pottawattamie County deputies
searched the Expedition. Before the search, Herrera claimed $2000 in
cash in the center console. The currency was held together with multiple
rubber bands. Riccaldo claimed $800 cash in his own front pants
pocket. This cash was also held together with rubber bands.
Sergeant Killpack inspected the ice cream machine. He noted the
electrical cord had been cut off; the internal components of the ice cream
machine had been removed leaving an empty, opaque storage area. The
officers found a “boost phone”—a mobile phone with only one number
programmed into it—as well as a vacuum pump, a rivet gun and rivets,
and a battery for a cordless drill. These tools could have been used to
install the hidden compartment mounted on the undercarriage. And
they found a “Pelican case” that contained drug paraphernalia and
remnants of marijuana. Herrera admitted to smoking marijuana the day
they left New York. Sergeant Killpack pulled the carpet back in the cargo
area and found the access hole to the aftermarket compartment he had
seen earlier. This compartment was empty.
The Expedition was towed to the IDOT maintenance garage in
Council Bluffs for further examination. The officers transported Herrera
and Riccaldo there. Captain Tom Bruun assisted Sergeant Killpack in a
further search of the vehicle, but they did not find any narcotics or
money. Sergeant Killpack told Herrera that the police were going to seize
the vehicle and the items found therein. He gave Herrera an evidence
receipt and a notice of forfeiture. Herrera and Riccaldo called a cab to
take them to the Omaha airport. They were allowed to depart with the
cash they were claiming.
Fernando Rodriguez of New York is the registered owner of the
Expedition. After his vehicle was seized, Rodriguez obtained counsel to
6
reclaim the vehicle. On September 18, Rodriguez’s attorney emailed the
county attorney to let the State know that “the owner has an innocent
owner position and will be entitled to attorney fees should he prevail in
that position.” The attorney noted that the attorney fees are provided by
statute and concluded that “the fees are going to be greater than the
vehicle value, so this might be one to let go.”
After learning of this email, Sergeant Killpack applied for and
obtained a search warrant. In his application, Sergeant Killpack stated
that he “ran a Kelly Blue Book valuation on th[e] vehicle and found that
in its current condition [it] would be worth $2,132 for resale.” The
application continued,
If a person looked at this situation in a cost benefit
analysis it does not make financial sense to spend a
significant amount of money, in attorney fees, in an attempt
to reclaim a vehicle worth $2,132. The attorney fees would
well surpass the value of the vehicle very quickly. Through
my training an[d] experience a person willing to spend a
significant amount of money to get their low value vehicle
back knows that there is something much more valuable still
inside the vehicle that has not been found by law
enforcement in the initial search.
I spoke to Captain Bruun, researched additional
concealment locations in this type of vehicle, and we
discussed all the areas that we searched. After our
conversation we came to the conclusion that we missed three
areas that are known concealment areas within a motor
vehicle of this year, make and model. Those areas are the
spare tire, the firewall and the underneath side of the center
consul [sic]. It is my belief that these three areas contain
either narcotics and or a large sum of US currency gained
from narcotics trafficking. The unfound, high value,
commodities would completely justify the significant cost
and effort to get a low value vehicle returned.
The application for the search warrant failed to mention that Rodriguez
had argued he was entitled to attorney fees from the State as an innocent
owner. The district court issued the search warrant. During the second
7
search of the vehicle, Sergeant Killpack found $44,990 hidden in a false
compartment inside the center console.
The State filed an in rem forfeiture complaint on October 1,
seeking to forfeit the “1999 Ford Expedition, soft serve ice cream
machine, pelican case, cordless drill and battery, vacuum pump and
United States Currency.” The State alleged the property was forfeitable
as “drug proceeds” or property “used in the transport of drugs.” In their
combined answer filed on November 5, Herrera and Rodriguez stated,
1. I, Fernando Rodriguez, am the owner of the 1999
Ford Expedition identified in the complaint as being subject
to forfeiture and an interest holder in the property seized
therefrom, including the U.S. Currency in the vehicle.
2. I, Jean Carlos Herrera, was in lawful possession of
the 1999 Ford Expedition, soft serve ice cream machine,
pelican case, cordless drill and battery, vacuum pump and
U.S. Currency identified in the complaint as being subject to
forfeiture and have a legal ownership and possessory interest
in those items.
3. We would ask that all mail in this matter be sent to
our attorney . . . .
4. With this answer we are also filing a motion
asserting that the vehicle stop, the subsequent detention
and seizure, and the search of that vehicle, violated the
prohibition against unreasonable searches and seizures
found in the Fourth Amendment to the United States
Constitution and the corresponding provision of the Iowa
Constitution.
5. The exclusionary rule under the Fourth
Amendment and Iowa Constitution applies in forfeiture
proceedings. See In the Matter of Property Seized from
Sharon Kay Flowers, 474 N.W.2d 546 (Iowa 1991).
6. By virtue of the application of the exclusionary rule,
further statements concerning the vehicle and its contents
would constitute derivative evidence also subject to the
exclusionary rule. Consequently, until there is a
determination on the motion to suppress, we object to
providing further information for the reason that such
further information would be the product of the original
search and seizure that we believe violated . . . constitutional
rights.
8
7. We request that the vehicle and its contents be
returned to Jean Carlos Herrera and Fernando Rodriguez,
since it belongs to them.
While the answer concluded, “We certify under penalty of perjury and
pursuant to the laws off the State of Iowa that the preceding is true and
correct,” only Herrera signed the answer. Rodriguez did not.
Two weeks later, Herrera filed a motion to suppress the evidence
and return the property. He argued that the stop of the vehicle and the
subsequent detention, search, and seizure were conducted in violation of
the Fourth Amendment and article I, section 8 of the Iowa Constitution.
Herrera later filed a supplemental motion to suppress, claiming that the
second search of the vehicle was unconstitutional because the warrant
application was defective and probable cause was based solely on
Rodriguez obtaining counsel to reclaim the vehicle.
On December 10, the court held a hearing on Herrera’s motion to
suppress. The State began by arguing that the motion to suppress
should not proceed because the claimant had not complied with the
statutory requirements for filing an answer to the forfeiture proceeding.
Specifically, the State pointed out that the claimant did not state “the
nature and extent of the claimant’s interest in the property” or “the date,
the identity of the transferor, and the circumstances of the claimant’s
acquisition of the interest in the property.”
The attorney for Rodriguez and Herrera responded that the answer
was sufficient until the motion to suppress was decided. He
acknowledged that if the motion was denied, his clients “could be
required at that point to come back in and amend their claim and their
answer.” But the attorney reiterated his position that it was “not
appropriate to require detailed disclosures when there’s a Fourth
Amendment issue that has to be taken up first.” The court took the
9
matter under advisement and gave the parties the opportunity to submit
briefs. The court heard Sergeant Killpack’s testimony.
That same day, Rodriguez filed a claim for return of the vehicle.
He argued that the vehicle did not meet the definition of property subject
to forfeiture under Iowa Code section 809A.4 and that the vehicle was
exempt from forfeiture under section 809A.5.
Herrera and the State submitted briefs before the court issued its
order on February 9, 2016. The district court determined that because
Herrera had not met the procedural requirements of section 809A.13(4),
he was not entitled to a forfeiture hearing. The court concluded that the
property claimed to be owned by Herrera was forfeited to the State.
Additionally, the court denied Herrera’s motion to suppress, finding the
issue moot because Herrera had not filed a proper answer and therefore
had no standing to challenge the forfeiture. Herrera timely appealed.
In its February 9 order, the district court did not decide
Rodriguez’s claim for the return of his vehicle because the matter had not
been set for hearing. The order provided that Rodriguez’s claim should
be scheduled for a hearing. Shortly thereafter, Rodriguez filed a motion
to suppress.
On February 23, the court found “there is no objection by the state
to claimant Fernando Rodriguez’s claim for return of property,
specifically his 1999 Ford Expedition.” The court granted Rodriguez’s
claim and canceled the hearing on the matter. Rodriguez then moved for
attorney fees and expenses in the amount of $8956.96 under Iowa Code
section 809A.12(7), contending he was a prevailing party within the
meaning of the statute. Dean Stowers, the attorney for both Rodriguez
and Herrera, submitted an attorney fee affidavit in which he clarified that
10
the attorney fees for representation of both clients totaled $8232.30 and
the expenses totaled $724.66. He concluded,
The work on this case would have been nearly the same had
I only represented Mr. Rodriguez because the suppression
issues were all part of the same overall factual scenario and
legal backdrop. I believe the total fees are reasonable given
all the issues at play in this matter and that the time and
work was reasonable.
Stowers did not specify what time was spent on Rodriguez’s case alone.
The State filed a motion to reopen the case but withdrew the
motion at a hearing held on March 24. The court heard arguments on
the motion for attorney fees at that time. The court denied the motion
for attorney fees, concluding that Rodriguez was not a “prevailing party”
and that the attorney fees requested by Rodriguez’s attorney were
attributable to the attorney’s representation of Herrera. Rodriguez timely
appealed.
Rodriguez filed a motion to consolidate his appeal with Herrera’s
appeal, and we granted the motion. We then transferred the
consolidated case to the court of appeals.
The court of appeals concluded that Herrera failed to file a proper
answer, so the district court correctly declined to address Herrera’s
constitutional challenge to the stop and searches. But the court of
appeals determined the district court “failed to determine the State’s
application established facts sufficient to show probable cause for
forfeiture,” as required by statute. 1 The court of appeals remanded the
1Iowa Code section 809A.16(3) provides,
Except as provided in subsection 1, if a proper claim is not timely filed in
an action in rem, or if a proper answer is not timely filed in response to a
complaint, the prosecuting attorney may apply for an order of forfeiture
and an allocation of forfeited property pursuant to section 809A.17.
Under such circumstance and upon a determination by the court that
the state’s written application established the court’s jurisdiction, the
11
case to the district court to make a probable cause determination. The
court of appeals affirmed the district court’s denial of Rodriguez’s motion
for attorney fees, concluding that Rodriguez did not meet his burden of
proving his fee claim. Herrera and Rodriguez applied for further review,
which we granted.
II. Standard of Review.
We review forfeiture proceedings for correction of errors at law. In
re Prop. Seized for Forfeiture from Young, 780 N.W.2d 726, 727 (Iowa
2010). Our review of constitutional issues is de novo. Id. We review the
district court’s denial of attorney fees for abuse of discretion. In re
Marriage of Kimbro, 826 N.W.2d 696, 698 (Iowa 2013). “We reverse the
district court’s ruling only when it rests on grounds that are clearly
unreasonable or untenable[; a] ruling is clearly unreasonable or
untenable . . . ‘when it is based on an erroneous application of the law.’ ”
Id. at 698–99 (citation omitted) (quoting In re Marriage of Schenkelberg,
824 N.W.2d 481, 484 (Iowa 2012)).
III. Analysis.
We confront the interplay between statutory pleading requirements
for in rem civil forfeiture proceedings in Iowa Code chapter 809A and
Herrera’s constitutional rights protecting against unreasonable searches
and seizures and compelled self-incrimination. We begin with an
overview of chapter 809A. We next address Herrera’s Fifth Amendment
objections to statutory pleading requirements. We conclude the district
court must first rule on motions to suppress evidence the State is using
to support its forfeiture claims. This outcome is consistent with the
_______________________
giving of proper notice, and facts sufficient to show probable cause for
forfeiture, the court shall order the property forfeited to the state.
Iowa Code § 809A.16(3).
12
statutory framework under which the State bears the burden to prove
grounds for forfeiture, before the burden shifts to the claimant to
establish a defense to forfeiture. We next hold the court may not enforce
the specific disclosure requirements of Iowa Code section 809A.13(4)(d)
over the claimant’s Fifth Amendment objection. Finally, we determine
that a claimant who recovers his property when the state withdraws its
objection after months of contested litigation without an adjudication on
the merits may be a prevailing party entitled to an award of attorney fees.
A. The Statutory Framework. In Iowa, forfeiture is a civil
proceeding. In re Prop. Seized from Aronson, 440 N.W.2d 394, 397 (Iowa
1989); see In re Prop. Seized for Forfeiture from Williams, 676 N.W.2d 607,
613 (Iowa 2004). Iowa Code chapter 809A governs in rem forfeiture
proceedings. In re Young, 780 N.W.2d at 727–28. “Forfeitures are not
favored under the law[,] and this court strictly construes statutes
allowing forfeitures.” In re Williams, 676 N.W.2d at 612.
The prosecuting attorney brings an in rem action “pursuant to a
notice of pending forfeiture or verified complaint for forfeiture.” Iowa
Code § 809A.13(2). An owner or interest holder in property can contest
the forfeiture proceeding by filing an answer to the complaint, as
provided in section 809A.13.
We addressed an as-applied challenge to the constitutionality of
Iowa Code section 809A.13(3) (2007) in In re Young, 780 N.W.2d at 727.
We explained that the filing of a verified complaint “amounts to a direct
resort to courts rather than a process that involves the service of a notice
of pending forfeiture and subsequent filing of claims and exemptions
with the prosecuting attorney prior to invoking the judicial process.” Id.
at 728. Section 809A.13(3), which applied to all in rem forfeiture actions,
then provided that “[o]nly an owner of or an interest holder in the
13
property who has timely filed a proper claim pursuant to section 809A.11
may file an answer in an action in rem.” Id. (quoting Iowa Code
§ 809A.13(3)). Under section 809A.11, a claim must be filed “within
thirty days after the effective date of notice of pending forfeiture.” Id.
(quoting Iowa Code § 809A.11). We explained,
Where the prosecuting attorney commenced forfeiture
pursuant to a verified complaint, however, there is no notice
of pending forfeiture and no requirement that a claim be filed
within thirty days. The only notice required for forfeiture of
property pursuant to an original verified complaint is service
of the verified complaint itself. Literally read, Iowa Code
section 809A.13(3) appears to prohibit an owner or
interested party from defending a forfeiture initiated
pursuant to a verified complaint.
Id. We agreed with the parties “that a statutory scheme which would
allow the forfeiture of property without notice and an opportunity to be
heard would violate due process under the United States and Iowa
Constitutions.” Id. We concluded that applying the statute to forfeiture
proceedings commenced by verified complaint would violate the due
process rights of interested parties. Id. at 729 (affirming the district
court’s order granting the state’s application for forfeiture because the
district court gave Young the opportunity to file an answer, and Young
declined to do so).
The legislature responded by amending section 809A.13(3) in
2013, striking the sentence that provided, “Only an owner of or an
interest holder in the property who has timely filed a proper claim
pursuant to section 809A.11 may file an answer in an action in rem.”
2013 Iowa Acts ch. 41, § 1. The statute now states, “For the purposes of
this section, an owner of or interest holder in property who has filed an
answer shall be referred to as a claimant.” Iowa Code § 809A.13(3)
(2015).
14
Under section 809A.13,
[t]he answer shall be signed by the owner or interest holder
under penalty of perjury and shall be in accordance with
rule of civil procedure 1.405 and shall also set forth all of the
following:
a. The caption of the proceedings and identifying
number, if any, as set forth on the notice of pending
forfeiture or complaint and the name of the claimant.
b. The address where the claimant will accept mail.
c. The nature and extent of the claimant’s interest in
the property.
d. The date, the identity of the transferor, and the
circumstances of the claimant’s acquisition of the interest in
the property.
e. The specific provision of this chapter relied on in
asserting that it is not subject to forfeiture.
f. All essential facts supporting each assertion.
g. The specific relief sought.
Iowa Code § 809A.13(4). The statute’s disclosure provisions are
mandatory. See Iowa Code § 809A.13(4) (“The answer . . . shall also set
forth all of the following . . . . (Emphasis added.)); see also id. § 4.1(30)(a)
(“The word ‘shall’ imposes a duty.”); In re Marriage of Thatcher, 864
N.W.2d 533, 539 (Iowa 2015) (“In a statute, the word ‘shall’ generally
connotes a mandatory duty.” (quoting In re Det. of Fowler, 784 N.W.2d
184, 187 (Iowa 2010))).
At the forfeiture hearing, the State had “the initial burden of
proving the property is subject to forfeiture by a preponderance of the
evidence.” Id. § 809A.13(7). 2 If the State proves the property is subject
2In 2017, the legislature changed the state’s burden of proof to clear and
convincing evidence. 2017 Iowa Acts ch. 114, § 10 (codified at Iowa Code § 809A.13(7)
(2018)). The amendment also changed the claimant’s burden of proof so that the
claimant is only required to make a prima facie showing that the exemption exists. Id.
Finally, if the claimant makes such a showing, the amended statute requires the state
to prove by clear and convincing evidence that the exemption does not apply. Id. The
amendment only applies to forfeiture proceedings that began on or after July 1, 2017,
see id. § 15, and therefore does not apply to this case in which the forfeiture complaint
was filed on October 1, 2015.
15
to forfeiture, the claimant has the burden of proving by a preponderance
of the evidence that one of the exemptions set forth in that chapter
exists. Id.
The district court found Herrera’s answer failed to comply with
paragraphs (c) and (d) of section 809A.13(4). We must decide whether
Herrera should be excused from complying with the requirements of
section 809A.13(4) based on his assertion of his Fifth Amendment
privilege against self-incrimination or his constitutional challenges to the
validity of the searches and seizures. As we recently observed in In re
Property Seized from Li, forfeiture statutes have faced increasing criticism
in recent years. ___ N.W.2d ___, ___ (Iowa 2018) (citing Leonard v. Texas,
___ U.S. ___, ___, 137 S. Ct. 847, 848–49 (2017) (Thomas, J., statement
respecting denial of certiorari) (acknowledging that civil forfeiture
operations—which have become more “widespread and highly profitable”
in recent decades—“frequently target the poor and other groups least
able to defend their interests in forfeiture proceedings” and expressing
skepticism over the constitutionality of the modern practice of civil
forfeiture); People ex rel. Hartrich v. 2010 Harley-Davidson, ___ N.E.3d
___, ___, 2018 WL 915075, at *14 (Ill. Feb. 16, 2018) (Karmeier, C.J.,
dissenting) (emphasizing that “courts must be vigilant in safeguarding
the rights of innocent persons who have legitimate interests in the
property at issue”)). Against that backdrop, we turn to issues presented
in this appeal.
B. Whether Invoking the Fifth Amendment Privilege Against
Self-Incrimination Excuses Compliance with the Pleading
Requirements of Section 809A.13(4). Herrera claims that by invoking
the Fifth Amendment privilege against self-incrimination, he is excused
from providing the information required under section 809A.13(4)(d) in
16
his answer to the State’s in rem forfeiture complaint. We agree and
conclude the district court must first rule on Herrera’s motion to
suppress evidence before adjudicating the forfeiture claims.
1. The district court must rule on motions to suppress before
adjudicating the forfeiture claims. As noted, the State has the initial
burden of proving grounds for forfeiture. Herrera agues the district court
should have first adjudicated his motion to suppress to determine what
evidence was available to support the State’s forfeiture claims. We agree.
We begin our analysis with In re Aronson, 440 N.W.2d at 395. In
Aronson, the police seized property at a cockfight. Id. Criminal charges
were filed against fifty-nine individuals from whom the property was
seized. Id. The county attorney filed a notice of forfeiture, and the
defendants filed claims for return of the property. Id. The state moved to
dismiss the “defendants’ claims based on their failure to identify specific
ownership interests in the property as required by” statute. Id. In
response, the defendants filed their own motion to dismiss the forfeiture
proceeding and moved to continue the forfeiture hearing; the court
denied the defendants’ motions. Id. The defendants decided “to stand on
their Fifth Amendment rights not to testify at the forfeiture hearing [and]
declined to identify their interests in the seized property.” Id.
In the criminal proceeding, the defendants filed a motion to
suppress the evidence that had been seized. Id. The court denied the
motion to suppress, finding the property had been legally seized. Id.
Following the forfeiture hearing, the court ordered forfeiture of the
property. Id. Defendants appealed, arguing the district court erred by
not postponing the civil forfeiture action until after the criminal trial. Id.
The error predicated on the court’s denial of a continuance is
that defendants were deprived of their property without due
process of law because they were compelled to choose to not
17
testify at the forfeiture hearing or risk incriminating
themselves.
Id. at 396. We held the defendants lacked standing to contest the
forfeiture because they failed to prove their interest in the property
forfeited. Id. at 398. We relied on federal precedent holding that a
person who invokes his or her Fifth Amendment right and refuses to
allege a specific interest in the property seized lacks standing to contest
the forfeiture. Id. at 397–98 (citing United States v. Fifteen Thousand Five
Hundred Dollars ($15,500.00) United States Currency, 558 F.2d 1359,
1361 (9th Cir. 1977) (“Where the underlying action is a civil forfeiture
suit, . . . none of the . . . bases for contesting the forfeiture is reached
unless the threshold requirement of being a claimant is filled. This can
be done only if the person desiring to defend the action claims an
ownership or possessory interest in the property seized.”); Baker v.
United States, 722 F.2d 517, 518 (9th Cir. 1983) (“The plaintiffs are not
‘claimants’ because they have alleged no specific property interest in the
forfeited items.”)).
But, the defendants in Aronson claimed no interest in the property
forfeited. By contrast, Herrera specifically claimed a possessory interest,
stating,
I, Jean Carlos Herrera, was in lawful possession of the 1999
Ford Expedition, soft serve ice cream machine, pelican case,
cordless drill and battery, vacuum pump and U.S. Currency
identified in the complaint as being subject to forfeiture and
have a legal ownership and possessory interest in those
items.
Herrera invoked his Fifth Amendment rights in refusing to provide the
additional information required by section 809A.13(4). And he argued
that the searches of the vehicle violated his rights under the Fourth
18
Amendment and article I, section 8 of the Iowa Constitution. He filed a
motion to suppress the evidence obtained in the searches of the vehicle.
We hold that when, as here, the claimant claims a possessory
interest, invokes his Fifth Amendment privilege, and files a motion to
suppress, the district court must first rule on the suppression motion
before adjudicating the forfeiture claims.
The outcome of the motion to suppress determines what evidence
the state can rely on during the forfeiture proceeding. “In establishing a
right to forfeiture, . . . the State may not rely on evidence obtained in
violation of fourth amendment protections nor derived from such
violations.” In re Flowers, 474 N.W.2d at 548. Flowers stands for the
proposition that the exclusionary rule applies in forfeiture proceedings;
the state cannot use evidence obtained in violation of the Fourth
Amendment in proving probable cause for forfeiture. Id. (acknowledging
that multiple courts cited One 1958 Plymouth Sedan v. Commonwealth,
380 U.S. 693, 85 S. Ct. 1246 (1965), “for the proposition that the
exclusionary rule applies to forfeiture proceedings”). If Herrera
ultimately succeeds on his motion to suppress, the State will be unable
to rely on the suppressed evidence in proving the probable cause
required for the forfeiture.
Other courts accommodate a claimant’s constitutional arguments
by delaying the claimant’s obligation to disclose required information.
See, e.g., United States v. $557,933.89, More or Less, in U.S. Funds, 287
F.3d 66, 73–74, 91 (2d Cir. 2002) (affirming forfeiture rulings that first
adjudicated Fourth Amendment challenges to search and seizure of
property at issue). The United States Court of Appeals for the Sixth
Circuit acknowledged that competing interests arise when claimants
19
assert their Fifth Amendment privileges in forfeiture proceedings. United
States v. U.S. Currency, 626 F.2d 11, 15 (6th Cir. 1980).
Clearly, appellees should not be compelled to choose
between the exercise of their Fifth Amendment privilege and
the substantial sums of money which are the subject of this
forfeiture proceeding. On the other side of the coin, however,
the government should not be compelled to abandon the
forfeiture action which Congress, by enacting the statute,
obviously intended to create. Therefore, the courts must
seek to accommodate both the constitutional right against
self-incrimination as well as the legislative intent behind the
forfeiture provision.
Id. The Sixth Circuit allowed the district court to determine the
appropriate accommodation on remand but suggested that “[t]he court
might . . . stay the forfeiture proceedings until the completion of any
criminal prosecutions, or until the relevant statutes of limitations for the
federal and state criminal offenses have expired.” Id. at 16–17; see also
United States v. $31,000.00 in U.S. Currency, 872 F.3d 342, 355 (6th Cir.
2017) (reversing threshold standing ruling that dismissed claimant’s
answer for failing to plead with specificity basis for ownership interest).
The Court of Appeals of Georgia rejected a claimant’s argument
that the Fifth Amendment privilege and corresponding privilege under
Georgia law “override[] the clear and well-settled requirement that, to be
sufficient, an answer in a civil forfeiture proceeding must include the
information requested” by statute. Loveless v. State, 786 S.E.2d 899,
901 (Ga. Ct. App. 2016). But the court explained, “Loveless was not
compelled to give evidence for or against himself in order to answer the
forfeiture petition, inasmuch as he could have requested a stay of the
forfeiture proceeding while the criminal case was pending.” Id. at 902.
The Arizona Supreme Court has held that a petitioner who
asserted a possessory interest in the property had standing to challenge
the forfeiture without disclosing information the petitioner considered
20
potentially incriminating. Wohlstrom v. Buchanan, 884 P.2d 687, 689 &
n.1 (Ariz. 1994). The Wohlstrom court recognized that
there may be times when, in order to establish a sufficient
property interest, it will be necessary for a claimant to
provide incriminating information. Under those
circumstances, other remedies may be appropriate, such as
staying forfeiture proceedings pending the outcome of any
related criminal charges or requiring immunity for the
claimant’s disclosures.
Id. at 692; see also United States v. Parcels of Land, 903 F.2d 36, 44 (1st
Cir. 1990) (acknowledging that district court entered a protective order to
accommodate claimant’s Fifth Amendment interest).
We agree that district courts should grant a defendant’s motion to
continue forfeiture proceedings until criminal charges are resolved. In
this case, no criminal charges were filed against Herrera. We conclude
the district court erred by failing to rule on the motion to suppress before
adjudicating the forfeiture claims.
2. The Fifth Amendment trumps the threshold pleading
requirements in section 809A.13(4)(d). We next consider whether Herrera
was excused from complying with the threshold pleading requirements of
section 809A.13(4)(d) because he invoked his Fifth Amendment privilege.
We conclude that he was. Based on the information provided in his
answer claiming an interest in the cash, and his assertion of his Fifth
Amendment privilege, Herrera has standing to contest the forfeiture.
As noted, the forfeiture statute’s disclosure provisions are
mandatory. See Iowa Code § 809A.13(4)(d) (“The answer . . . shall also
set forth all of the following: . . . [t]he date, the identity of the transferor,
and the circumstances of the claimant’s acquisition of the interest in the
property.” (Emphasis added.)). The State argues, and the district court
ruled, that Herrera’s omission of the required information from his
21
Answer was fatal to his claim. This puts Herrera to a difficult choice
between asserting his privilege against self-incrimination or foregoing his
claim for return of the contested property.
Some courts reject Fifth Amendment objections to forfeiture
statutory disclosure requirements by concluding that claimants fearing
self-incrimination can simply refrain from demanding return of the
disputed property. See State v. $8,000.00 U.S. Currency, 827 So. 2d 634,
639 (La. Ct. App. 2002). There, the Louisiana Court of Appeals rejected a
claimant’s argument that he should not have to provide certain
information required by the forfeiture statute because doing so could be
self-incriminating. Id. The court observed, “If one does not wish to
incriminate himself or subject himself to prosecution for perjury or false
swearing, he simply does not file a claim under [the statute], as the filing
of such a claim is not required.” Id. The fact the claimant faces a tough
choice “does not violate any constitutional guarantees.” Id. But see
People v. $1,124,905 U.S. Currency & One 1988 Chevrolet Astro Van, 685
N.E.2d 1370, 1390–91 (Ill. 1997) (Freeman, C.J., dissenting)
(acknowledging that claimants “face a Hobson’s choice: either surrender
the constitutional privilege and subject themselves to possible criminal
prosecution, or forgo the opportunity to contest the forfeiture” and
concluding that claimants “should be permitted to invoke the fifth
amendment right against self-incrimination with respect to” the statutory
disclosure requirements).
We have recognized in other contexts that it is not
unconstitutionally coercive to force a defendant to make difficult choices.
See, e.g., State v. Speed, 573 N.W.2d 594, 597 (Iowa 1998) (“The fact that
an accused may elect to plead guilty to a lesser offense when he is also
charged with a more serious offense does not make his plea coerced.”
22
(quoting State v. Lindsey, 171 N.W.2d 859, 865 (Iowa 1969))). Indeed,
“[t]he Fifth Amendment . . . allows room for hard choices after a
conviction when legitimate penological goals are served.” State v.
Washington, 832 N.W.2d 650, 660 (Iowa 2013). There, we noted that
[a] defendant facing sentencing may confront such choices
when he or she is asked to provide his or her version of the
offense for purposes of a [presentence investigation].
Likewise, the defendant may face the same dilemma when
offered the right of allocution at the sentencing hearing. If
the defendant does not admit to having engaged in criminal
conduct, will the defendant appear unremorseful or unlikely
to benefit from rehabilitation?
Id. In State v. Iowa District Court, we rejected a Fifth Amendment claim
raised by an inmate who was denied earned-time credit for failing to
undergo sex offender treatment that required him to acknowledge
responsibility for his offense. 801 N.W.2d 513, 515 (Iowa 2011). We
reiterated that “a person’s exercise of a constitutional right may indeed
have consequences” without violating the Fifth Amendment. Id. at 528
(quoting In re C.H., 652 N.W.2d 144, 150 (Iowa 2002) (acknowledging
that a parent’s failure to admit responsibility for sexual abuse may hurt
the parent’s chance of regaining custody of the child but explaining that
this consequence falls outside the protection of the Fifth Amendment)).
These cases are distinguishable because the defendant had already pled
guilty or been convicted of a crime. By contrast, Herrera was not
charged with or convicted of a crime.
In Wohlstrom, the Arizona Supreme Court held that striking the
petitioner’s claim to property violated the Fifth Amendment and the
parallel state constitutional provision when the petitioner declined to
provide some of the information required by the forfeiture statute. 884
P.2d at 688, 693. The court noted that, “by invoking his right against
self-incrimination, petitioner lost the ability to intervene in the
23
proceedings, virtually assuring a forfeiture.” Id. at 689. The court
concluded “that the trial court impermissibly forced petitioner to choose
between ‘surrendering his constitutional privilege and forfeiting
property.’ ” Id. at 690 (quoting State v. Ott, 808 P.2d 305, 312 (Ariz. Ct.
App. 1990)). Therefore, the petitioner who asserted a possessory interest
in the property had standing to challenge the forfeiture without
disclosing information the petitioner considered potentially
incriminating. Id. at 689 & n.1.; see also United States v. Real Prop.
Known as 212 East 47th Street, Apt. 4E, New York, New York,
No. 16–8375 (MLC)(DEA), 2017 WL 1496931, at *4–7 (D.N.J. Apr. 25,
2017) (concluding that a claimant who filed a verified claim but objected
to filing an answer to the forfeiture complaint—as required by the federal
rule—on the basis of his Fifth Amendment privilege had statutory
standing to assert a claim in the forfeiture proceeding).
The State relies on United States v. $154,853.00 in U.S. Currency,
in which the United States Court of Appeals for the Eighth Circuit held a
forfeiture claimant’s refusal to provide the requisite information “on the
asserted basis of his Fourth and Fifth Amendment privileges did not
preclude the district court from striking his claims.” 744 F.3d 559, 564
(8th Cir. 2014). The claimant filed an amended verified claim in which
he stated,
Claimant has an ownership and possessory interest in the
seized U.S. Currency. $4,500.00 more or less of the U.S.
Currency was found on Claimant’s person and earned by
Claimant through his employment. The remaining $150,353
more or less of the U.S. Currency was given to Claimant by
another person with Claimant as bailee.
Id. at 562. The claimant did not identify the bailor but instead
“object[ed] to being required to provide any additional information under
the Fourth Amendment and Fifth Amendment privileges.” Id. In
24
addition, the government submitted special interrogatories, and the
claimant responded to each interrogatory by stating,
I object to answering this interrogatory for the reason that
any answer I would give would be evidence derived from
prior violations of the Fourth Amendment and Fifth
Amendment to the United States Constitution and that I
claim the Fourth Amendment and Fifth Amendment
exclusionary rules as a privilege against answering at this
time.
Id. at 561–62.
The district court struck the claimant’s amended verified complaint
because it did not comply with the rule requiring that “on asserting an
interest in currency as a bailee, the claimant must identify the bailor.”
Id. at 562. The court also determined the claimant’s answer to the
special interrogatories was insufficient. Id. The court ordered forfeiture
of the currency, and the claimant appealed. Id. The Eighth Circuit held
that the claimant’s assertion of his Fourth and Fifth Amendment
privileges did not preclude the district court from striking his claims for
failure to establish statutory standing. Id. at 564 (citing United States v.
$148,840.00 in U.S. Currency, 521 F.3d 1268, 1273–74 (10th Cir. 2008)
(“A claimant’s decision to invoke the Fifth Amendment’s protection
against self-incrimination ... does not decrease his burden of
establishing standing [under the forfeiture statute.]”)).
The Sixth Circuit criticized $154,853.00 in U.S. Currency for its
dearth of analysis in “affirm[ing] the striking of the claim for failure to
comply with [the rule] because it contained ‘blanket assertions that did
not sufficiently identify [the claimant’s] interest’ in the funds to be
forfeited.” $31,000.00 in U.S. Currency, 872 F.3d at 353 (alteration in
original) (quoting $154,853.00 in U.S. Currency, 744 F.3d at 563) (noting
25
that “[t]he Eighth Circuit does not provide any persuasive analysis . . . to
demonstrate why this holding must be true”).
We are persuaded by the Arizona Supreme Court’s reasoning in
Wohlstrom. Herrera should be excused from complying with the pleading
requirements of section 809A.13(4)(d) because he claimed a possessory
interest in the property and invoked his Fifth Amendment privilege
against self-incrimination. See Wohlstrom, 884 P.2d at 689 & n.1
(concluding petitioner who asserted a possessory interest in the property
had standing to challenge the forfeiture without disclosing information
the petitioner considered potentially incriminating). 3
We hold the district court erred by rejecting Herrera’s claim based
on his noncompliance with the statutory disclosure requirements. The
district court should have sustained his Fifth Amendment objection to
the disclosures specified in Iowa Code section 809A.13(4)(d). The district
court improperly dismissed Herrera from the forfeiture proceedings. See
Wehling v. Columbia Broad. Sys., 608 F.2d 1084, 1088 (5th Cir. 1979)
(noting that when one party’s “silence is constitutionally guaranteed,
dismissal is appropriate only where other, less burdensome, remedies
would be an ineffective means of preventing unfairness” to the other
party).
C. Whether Rodriguez Is Entitled to Recover Attorney Fees as
a Prevailing Party. We next address whether Rodriguez was entitled to
attorney fees under Iowa Code section 809A.12(7) as a prevailing party.
The district court ruled that he was not a prevailing party because the
State did not object to the return of the vehicle and there was no
3The State seized the cash from a vehicle Herrera was driving across the
country, and Herrera alone claims the currency at issue in this proceeding. See
Wohlstrom, 884 P.2d at 691 (recognizing “the state’s need to protect against fraudulent
claims”).
26
adjudication on the merits. The district court also found Rodriguez
incurred no attorney fees because “every cent of attorney’s fees requested
by [Rodriguez’s lawyer] is attributable to his representation of Herrera.”
The court of appeals affirmed the denial of fees on that ground alone,
without reaching the question of whether Rodriguez is a prevailing party.
We elect to decide the threshold question first—whether Rodriguez is a
prevailing party.
We have not yet addressed whether a party in Rodriguez’s position
is a prevailing party under Iowa Code section 809A.12(7), which
provided,
In any proceeding under this chapter, if a claim is based on
an exemption provided for in this chapter, the burden of
proving the existence of the exemption is on the claimant.
However, once the claimant comes forward with some
evidence supporting the existence of the exemption, the state
must provide some evidence to negate the assertion of the
exemption. The state’s evidence must be substantial,
though not necessarily rising to the level of a preponderance
of the evidence, and more than a simple assertion of the
claimant’s interest in the property. The agency or political
subdivision bringing the forfeiture action shall pay the
reasonable attorney fees and costs, as determined by the
court, incurred by a claimant who prevails on a claim for
exemption in a proceeding under this chapter.
Iowa Code § 809A.12(7). 4 The legislature presumably enacted the
fee-shifting provision in the chapter 809A, the Forfeiture Reform Act, to
4The legislature amended this provision in 2017, and it now provides,
In any proceeding under this chapter, if a claim is based on an
exemption provided for in this chapter, the claimant must make a prima
facie showing of the existence of the exemption. The prosecuting attorney
must then prove by clear and convincing evidence that the exemption
does not apply. The agency or political subdivision bringing the forfeiture
action shall pay the reasonable attorney fees and costs, as determined by
the court, incurred by a claimant who prevails on a claim for exemption
in a proceeding under this chapter.
2017 Iowa Acts ch. 114, § 5 (codified at Iowa Code § 809A.12(7) (2018)).
27
expand access to legal counsel in civil forfeiture proceedings. See City of
Riverdale v. Diercks, 806 N.W.2d 643, 653 (Iowa 2011) (“The reason an
Iowa statute entitles successful litigants to attorney fees ‘is to ensure
that private citizens can afford to pursue the legal actions necessary to
advance the public interest vindicated by the policies’ of the statute.”
(quoting Lynch v. City of Des Moines, 464 N.W.2d 236, 239 (Iowa 1990)));
see also Louis S. Rulli, The Long Term Impact of CAFRA: Expanding
Access to Counsel and Encouraging Greater Use of Criminal Forfeiture, 14
Fed. Sent’g Rep. 87, 90 (2001) (acknowledging that “[w]ith civil forfeiture
law so heavily weighted in favor of the government and without an
assurance of fees even when the property owner prevailed, private
lawyers were understandably reluctant to invest in civil forfeiture cases”
and applauding the Federal Civil Asset Forfeiture Reform Act of 2000
(CAFRA) for authorizing an award of attorney fees to a person who
“substantially prevails” against the government in a civil forfeiture
proceeding because the provision “provides needed incentive for private
lawyers to become more involved in civil forfeiture cases”).
Civil forfeiture proceedings lack the procedural protections of
criminal cases. See Leonard, ___ U.S. ___, 137 S. Ct. at 847–48 (Thomas,
J., statement respecting denial of certiorari). Allowing fee awards under
chapter 809A when the owner prevails after contested proceedings
furthers the legislative purpose to incentivize attorneys to represent
citizens seeking return of their property from the government. This will
help level the playing field for persons contesting government seizures of
private property.
The “innocent owner” exemption upon which Rodriguez relies is
codified in section 809A.5(1)(a), which exempts property from forfeiture if
28
[t]he owner or interest holder acquired the property before or
during the conduct giving rise to its forfeiture, and did not
know and could not reasonably have known of the conduct
or that the conduct was likely to occur, or acted reasonably
to prevent the conduct giving rise to forfeiture.
Iowa Code § 809A.5(1)(a). Rodriguez’s attorney made clear from the
beginning of the proceedings that Rodriguez relied on the “innocent
owner” exemption in section 809A.5(1)(a) and would pursue attorney fees
if he prevailed.
The timeline of this case shows how legal counsel was needed to
level the playing field. The State impounded the Expedition owned by
Rodriguez on September 12, 2015. Rodriguez, a New York resident,
hired Iowa counsel who asserted the innocent-owner defense six days
later. On October 1, the State filed the in rem civil forfeiture complaint
against the vehicle, cash, and other property. Herrera and Rodriguez
filed a joint answer to that complaint on November 5. On December 10,
Rodriguez filed a separate claim for return of the Expedition. The same
day, during the hearing on Herrera’s motion to suppress, the State
contended the joint answer filed by Rodriguez was insufficient. On
February 9, 2016, the district court set a separate hearing on Rodriguez’s
claim for February 25. Rodriguez filed his own motion to suppress a
week before that hearing. The State did not desist its opposition until
several days before the hearing, which the court canceled on
February 23. Through the efforts of his lawyer, Rodriguez recovered his
vehicle over five months after asserting his “innocent owner” defense. On
these facts, we conclude that Rodriguez is a prevailing party under
section 809A.12(7). He obtained this relief (the return of his vehicle)
without a favorable court adjudication only after five months of contested
litigation.
29
This is not a case in which the State backed down from forfeiting
the property shortly after the claimant asserted an innocent-owner
exemption. Instead, the State persisted in an attempt to forfeit not just
the cash, but the vehicle as well.
The State’s acquiescence to the vehicle’s return after months of
contested litigation is tantamount to a voluntary dismissal that in other
contexts has been held sufficient to support a fee award. For example, in
In re Marriage of Roerig, the court of appeals considered “whether upon
plaintiff’s voluntary dismissal of her action, defendant became the
prevailing party for purposes of an award of reasonable attorney fees
under” Iowa’s dissolution-of-marriage statute. 503 N.W.2d 620, 622
(Iowa Ct. App. 1993). The court of appeals noted it was “well-established
that statutory . . . provisions providing for an award of attorney’s fees to
the prevailing party in litigation encompass defendants in suits which
have been voluntarily dismissed.” Id. (quoting Hatch v. Dance, 464
So. 2d 713, 714 (Fla. Dist. Ct. App. 1985) (per curiam)). The court
therefore determined that the defendant was the prevailing party, “[e]ven
though there was no final determination on the merits.” Id.
In Dutcher v. Randall Foods, we accepted the United States
Supreme Court’s definition of “prevailing party” when determining
whether a plaintiff was entitled to attorney fees under the Federal Fair
Labor Standards Act. 546 N.W.2d 889, 895 (Iowa 1996). Under that
definition, “[a] plaintiff ‘prevails’ when actual relief on the merits of his
claim materially alters the legal relationship between the parties by
modifying the defendant’s behavior in a way that directly benefits the
plaintiff.” Id. (quoting Farrar v. Hobby, 506 U.S. 103, 111–12, 113 S. Ct.
566, 573 (1992)). We concluded that the plaintiff “clearly obtained actual
30
relief on the merits of her claim: she proved that [the defendant] engaged
in wage discrimination on the basis of gender.” Id.
Federal courts are divided on whether a party can be a prevailing
party when the opposing party voluntarily dismisses the case. Compare
Automation Support, Inc. v. Humble Design, L.L.C., No. 17–10433, 2018
WL 2139042, at *3–5 (5th Cir. May 9, 2018) (per curiam) (concluding
defendant was a prevailing party under the Texas Theft Liability Act
when the parties “agreed to a voluntary dismissal of the case with
prejudice”), and United States v. 163.25 Acres of Land, More or Less,
Situated in Graves Cty., Ky., 663 F. Supp. 1119, 1120 (W.D. Ky. 1987)
(defining “prevailing party” as “one who has received substantially the
relief requested or has been successful on the central issue” and
concluding claimants were prevailing parties when the action was
voluntarily dismissed and they received the relief they requested (quoting
United States v. Certain Real Prop. Located at 4880 S.E. Dixie
Highway, 628 F. Supp. 1467, 1469 (S.D. Fla. 1986), vacated on other
grounds, 838 F.2d 1558, 1566 (11th Cir. 1988))), with Cadkin v. Loose,
569 F.3d 1142, 1148–49 (9th Cir. 2009) (concluding that the test for
determining a prevailing party under the Copyright Act is whether “some
court action has created a ‘material alteration of the legal relationship of
the parties’ ” (quoting Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t
of Health & Human Res., 532 U.S. 598, 604, 121 S. Ct. 1835, 1840
(2001))), and United States v. Thirty-Two Thousand Eight Hundred Twenty
Dollars & Fifty-Six Cents ($32,820.56) in U.S. Currency, 106 F. Supp. 3d
990, 995 (N.D. Iowa 2015) (concluding claimants did not “substantially
prevail” and were therefore not entitled to attorney fees under CAFRA
because “[t]he dismissal without prejudice lacks the required judicial
31
imprimatur to qualify as a material alteration of the parties’ legal
relationship”), aff’d, 838 F.3d 930 (8th Cir. 2016).
The United States Supreme Court recently held “that a defendant
need not obtain a favorable judgment on the merits in order to be a
‘prevailing party’ ” under Title VII. CRST Van Expedited, Inc. v. E.E.O.C.,
578 U.S. ___, ___, 136 S. Ct. 1642, 1651 (2016) (emphasis added). The
Supreme Court vacated the judgment of the court of appeals, which held
that the defendant did not prevail on claims that were dismissed by the
district court because the commission failed to investigate or conciliate
the claims as required by Title VII. Id. The Supreme Court explained,
Common sense undermines the notion that a
defendant cannot “prevail” unless the relevant disposition is
on the merits. Plaintiffs and defendants come to court with
different objectives. A plaintiff seeks a material alteration in
the legal relationship between the parties. A defendant
seeks to prevent this alteration to the extent it is in the
plaintiff’s favor. The defendant, of course, might prefer a
judgment vindicating its position regarding the substantive
merits of the plaintiff’s allegations. The defendant has,
however, fulfilled its primary objective whenever the
plaintiff’s challenge is rebuffed, irrespective of the precise
reason for the court’s decision. The defendant may prevail
even if the court’s final judgment rejects the plaintiff’s claim
for a nonmerits reason.
Id. CRST did not deal with a voluntary dismissal. But we find its
reasoning applies here. Rodriguez sought to prevent the State from
taking permanent possession of his vehicle. He fulfilled his primary
objective of getting his vehicle back after months of contested litigation
against the State. On this record, we hold that Rodriguez is a prevailing
party even though the district court did not expressly find that he was an
“innocent owner.” The district court erred by ruling that Rodriguez was
not a prevailing party.
32
The court of appeals and district court also concluded that
Rodriguez failed to meet his burden of proving what amount of fees were
attributable to counsel’s representation of Rodriguez rather than Herrera.
“An applicant for attorney fees has the burden to prove that the services
were reasonably necessary and that the charges were reasonable in
amount.” Schaffer v. Frank Moyer Constr., Inc., 628 N.W.2d 11, 23 (Iowa
2001). In view of our holding that Rodriguez is a prevailing party, we
conclude the remedy for the shortcomings in documenting his fee
request is not to deny him any fee award, but rather to remand the case
to allow him the opportunity to show the amount of reasonable attorney
fees he incurred recovering his Expedition apart from those the same
lawyer incurred representing Herrera. Several of the attorney’s actions
were clearly done solely for Rodriguez, such as filing his request for
return of the vehicle, filing a separate motion to suppress, and
communicating with counsel for the State over the Expedition’s return.
The district court abused its discretion by denying Rodriguez any fee
award.
We remand this case to the district court to determine the
reasonable attorney fees related to the representation of Rodriguez alone.
See In re Estate of Bockwoldt, 814 N.W.2d 215, 232–33 (Iowa 2012)
(allowing resubmission of more detailed fee application on remand). On
remand, the court may also award appellate attorney fees. See Schaffer,
628 N.W.2d at 23 (concluding district court had authority to award
appellate attorney fees pursuant to statute providing attorney fees for a
prevailing plaintiff when the statute “in no way limit[ed] attorney fees to
those incurred in the district court”); Bankers Trust Co. v. Woltz, 326
N.W.2d 274, 278 (Iowa 1982) (awarding appellate attorney fees pursuant
to statutory provision allowing attorney fees under contract that did not
33
limit fees to those incurred at trial); see also Baumhoefener Nursery, Inc.
v. A & D P’ship, II, 618 N.W.2d 363, 369 (Iowa 2000) (permitting award of
appellate attorney fees under mechanic’s lien statute because the
mechanic’s lienholder prevailed on appeal). The award of fees may
include time preparing his separate fee claim and litigating his
entitlement to fees. See Lynch, 464 N.W.2d at 240–41.
IV. Disposition.
For those reasons, we vacate the decision of the court of appeals
and reverse the district court judgment forfeiting the personal property
claimed by Herrera and denying any fee award to Rodriguez. We remand
the case for the district court to rule on the motion to suppress under
the existing record and, then, resume the forfeiture proceedings as to
Herrera consistent with this opinion. On remand, Rodriguez may submit
a new application for his own attorney fees, and the district court shall
then determine the amount of reasonable attorney fees (including
appellate fees) Rodriguez incurred recovering his vehicle.
DECISION OF COURT OF APPEALS VACATED; DISTRICT
COURT JUDGMENT REVERSED; CASE REMANDED WITH
INSTRUCTIONS.
All justices concur except Hecht, J., who takes no part.