Kam-Almez v. United States , 682 F.3d 1364 ( 2012 )

United States Court of Appeals
for the Federal Circuit
__________________________
MAJD KAM-ALMAZ,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
__________________________
2011-5059
__________________________
Appeal from the United States Court of Federal
Claims in Case No. 09-CV-007, Judge Lawrence M.
Baskir.
__________________________
Decided: June 20, 2012
__________________________
MATTHEW J. DOWD, Wiley Rein LLP, of Washington,
DC, argued for plaintiff-appellant. Of counsel on the brief
was BRUCE W. MCLAUGHLIN, Law Offices of Bruce
McLaughlin, of Leesburg, Virginia.
JEANNE E. DAVIDSON, Director, Commercial Litigation
Branch, Civil Division, United States Department of
Justice, of Washington, DC, argued for defendant-
appellee. With her on the brief were TONY WEST, Assis-
tant Attorney General, PATRICIA M. MCCARTHY, Assistant
Director, and SARAH A. MURRAY, Trial Attorney.
KAM-ALMAZ v. US 2
AMJAD M. KHAN, Latham & Watkins LLP, of Los An-
geles, California, for amicus curiae. With him on the brief
were ABID RIAZ QURESHI, of Washington, DC, GHAITH
MAHMOOD, of Los Angeles, California, and YUSUF ZAKIR,
of Costa Mesa, California.
__________________________
Before NEWMAN, LOURIE, and PROST, Circuit Judges.
Opinion for the court filed by Circuit Judge LOURIE.
Dissenting opinion filed by Circuit Judge NEWMAN.
LOURIE, Circuit Judge.
Majd Kam-Almaz appeals from the final decision of
the United States Court of Federal Claims dismissing his
breach of contract and Fifth Amendment taking claims.
We affirm.
BACKGROUND
Kam-Almaz alleged the following facts in his plead-
ings before the Court of Federal Claims. See Compl., Jan.
5, 2009, ECF No. 1; Am. Compl., Jan. 25, 2010, ECF No.
23. Kam-Almaz is a United States citizen employed in
the business of international disaster relief assistance.
On April 7, 2006, Kam-Almaz returned home from an
overseas business trip. At Dulles International Airport in
Loudoun County, Virginia, Agent Craig Muldowan of the
United States Immigration and Customs Enforcement
(“ICE”) detained Kam-Almaz, informing him that he was
a “person of interest to ICE.” Compl. ¶ 8. Muldowan
seized Kam-Almaz’s laptop and two flash drives for re-
view by ICE. Before Muldowan seized the equipment,
however, Kam-Almaz informed him that it contained the
only copies of his business files; in response, Muldowan
permitted Kam-Almaz to copy and retain one computer
3 KAM-ALMAZ v. US
file. Upon seizing the equipment, Muldowan provided to
Kam-Almaz a signed Customs Form 6051D indicating
that the equipment would be detained for up to thirty
days. Muldowan also verbally assured Kam-Almaz that
the equipment would be held for no more than seven days.
While the laptop was detained, its hard drive failed,
destroying much of Kam-Almaz’s business software. On
May 15, 2006, a representative from the U.S. Customs
and Border Protection (“Customs”) sent Kam-Almaz a
letter seeking to assure him that a prompt resolution of
the issue would be addressed by Muldowan. On June 21,
2006, about ten weeks after its seizure, the laptop was
returned to Kam-Almaz. On June 24, 2006, the Director
of Investigations for ICE sent Kam-Almaz a letter repre-
senting that “ICE has made every attempt to minimize
the inconvenience to [Kam-Almaz]. ICE copied the files
and provided them to Mr. Kam-Almaz during the initial
border stop.” Compl. ¶¶ 18–19.
On January 5, 2009, Kam-Almaz filed suit in the
Court of Federal Claims, alleging breach of an implied-in-
fact contract. On January 25, 2010, he amended his
complaint and included a takings claim. Kam-Almaz
alleged damages totaling $469,480.00 due to lost business
contracts resulting from his inability to access his com-
puter files as well as replacement hardware, software,
and warranty costs. On June 30, 2010, the government
moved to dismiss, arguing that the Court of Federal
Claims lacked jurisdiction over Kam-Almaz’s complaint,
and that the complaint failed to state a claim upon which
relief could be granted.
In a decision dated January 7, 2011, the Court of Fed-
eral Claims granted the government’s motion to dismiss.
Kam-Almaz v. United States, 96 Fed. Cl. 84, 86 (2011).
On the breach of contract claim, the court dismissed
KAM-ALMAZ v. US 4
under Rule 12(b)(6) of the United States Court of Federal
Claims (“RCFC 12(b)(6)”) for failure to state a claim upon
which relief can be granted. The court held that the
complaint failed in several respects to allege facts suffi-
cient to find a bailment contract. The court found that,
because the complaint stated that his property was
seized, Kam-Almaz did not “deliver[] personalty” to the
government as a bailment requires. Id. at 88. The court
further found that the complaint failed to allege that the
government promised to return the computer in accor-
dance with Kam-Almaz’s instructions or to guard or
carefully handle the equipment. Again focusing on the
fact that the complaint described the government’s act as
a “seizure,” the court found that the complaint failed to
allege facts demonstrating the required mutuality of
intent between the parties. Finally, the court held that
the complaint lacked the necessary allegations of Mul-
dowan’s authority to enter into a bailment contract.
The Court of Federal Claims also dismissed Kam-
Almaz’s takings claim under RCFC 12(b)(6). The court
explained that property seized and retained pursuant to
the government’s police power is not taken for a public
use within the context of the Fifth Amendment’s Takings
Clause. Noting that border agents do not have authority
to seize property without having reasonable cause to
suspect a violation of law, the court rejected Kam-Almaz’s
theory that the laptop was seized, not according to the
police power, but according to an administrative border
search for security purposes. The court further explained
that, if the seizure was unauthorized, then the Court of
Federal Claims would lack jurisdiction, because due
process and Fourth Amendment claims are reserved for
district courts. Finally, the court held that even assuming
the government’s actions were authorized and that an
unreasonable delay in returning the property amounted
5 KAM-ALMAZ v. US
to a taking, the court lacks jurisdiction over damage
claims for due process violations.
Kam-Almaz appealed. We have jurisdiction pursuant
to 28 U.S.C. § 1295(a)(3).
DISCUSSION
To avoid dismissal for failure to state a claim under
RCFC 12(b)(6), “a complaint must allege facts ‘plausibly
suggesting (not merely consistent with)’ a showing of
entitlement to relief.” Acceptance Ins. Cos., Inc. v. United
States, 583 F.3d 849, 853 (Fed. Cir. 2009) (quoting Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007)). The
facts as alleged “must be enough to raise a right to relief
above the speculative level, on the assumption that all the
allegations in the complaint are true (even if doubtful in
fact).” Twombly, 550 U.S. at 555 (citations omitted). At
the same time, a court is “‘not bound to accept as true a
legal conclusion couched as a factual allegation.’” Id.(quoting Papasan v. Allain, 478 U.S. 265, 286 (1986)). We
review de novo a decision to dismiss a complaint for
failure to state a claim under RCFC 12(b)(6). Hearts Bluff
Game Ranch, Inc. v. United States, 669 F.3d 1326, 1328
(Fed. Cir. 2012). We also review de novo the grant or
denial of a motion to dismiss for lack of jurisdiction. See
Frazer v. United States, 288 F.3d 1347, 1351 (Fed. Cir.
2002).
I
We first address Kam-Almaz’s claim for breach of an
implied-in-fact bailment contract. “An implied-in-fact
contract with the government requires proof of (1) mutu-
ality of intent, (2) consideration, (3) an unambiguous offer
and acceptance, and (4) actual authority on the part of the
government’s representative to bind the government in
contract.” Hanlin v. United States, 316 F.3d 1325, 1328
KAM-ALMAZ v. US 6
(Fed. Cir. 2003) (internal quotation marks omitted). An
implied-in-fact contract is founded upon a meeting of the
minds and “‘is inferred, as a fact, from the conduct of the
parties showing, in the light of the surrounding circum-
stances, their tacit understanding.’” Id. (quoting Balt. &
Ohio R.R. v. United States, 261 U.S. 592, 597 (1923)). “A
bailment relationship is said to arise where an owner,
while retaining title, delivers personalty to another for
some particular purpose upon an express or implied
contract. The relationship includes a return of the goods
to the owner or a subsequent disposition in accordance
with his instructions.” Lionberger v. United States, 371
F.2d 831, 840 (Ct. Cl. 1967); see also 19 Williston on
Contracts § 53:1 (4th ed. 2012) (defining a bailment as “a
delivery of personalty for some particular purpose, or on
mere deposit, upon a contract, express or implied, that
after the purpose has been fulfilled it shall be redelivered
to the person who delivered it, or otherwise dealt with
according to his directions, or kept until he reclaims it, as
the case may be.” (international quotation marks omit-
ted)). Kam-Almaz, as the plaintiff, bears the burden of
proving the existence of an implied-in-fact contract. See
Hanlin v. United States, 316 F.3d 1325, 1330 (Fed. Cir.
2003).
Kam-Almaz contends that the Court of Federal
Claims erred by concluding that his complaint failed to
allege facts sufficient to assert a plausible claim for
breach of an implied bailment contract. Kam-Almaz
asserts that his complaint plausibly alleges a bailment
because Kam-Almaz “delivered personalty” by transfer-
ring possession of his laptop to ICE, and because his
computer was expected to be held only for a short period
of time and then returned in working condition. Kam-
Almaz further contends that his complaint plausibly
alleges a breach of an implied-in-fact contract because the
7 KAM-ALMAZ v. US
facts alleged demonstrate (1) mutuality of intent to con-
tract, (2) a negotiation demonstrating offer, acceptance,
and consideration, and (3) actual authority of Muldowan
to bind the United States in contract. Finally, he con-
tends that Supreme Court and Federal Circuit cases
recognize that a party in Kam-Almaz’s shoes may be able
to establish a breach of an implied contract when property
temporarily detained by the government is damaged.
The government, in response, contends that the Court
of Federal Claims correctly dismissed Kam-Almaz’s
complaint on the pleadings. According to the government,
Kam-Almaz did not allege mutual intent to contract
because the government lawfully seized the laptop pursu-
ant to its police power. The government further asserts
that Kam-Almaz failed to establish any other element of
an implied-in-fact bailment contract, including an offer,
acceptance, consideration, and actual authority to con-
tract.
We agree with the government that the Court of Fed-
eral Claims correctly dismissed Kam-Almaz’s complaint
for failure to allege facts plausibly suggesting a breach of
an implied-in-fact bailment contract. Like the Court of
Federal Claims, we find numerous deficiencies in Kam-
Almaz’s complaint. The complaint does not plausibly
allege the required elements of a bailment. Kam-Almaz
did not voluntarily “deliver” his equipment to Muldowan.
See Goudy & Stevens, Inc. v. Cable Marine, Inc., 924 F.2d
16, 18 (1st Cir. 1991). Rather, as Kam-Almaz repeatedly
alleged, it was involuntarily “seized.” See Compl. ¶¶ 4, 5,
8, 10–12, 14, 16; Am. Compl. ¶ 3. The complaint further
fails to allege facts indicating the mutual intent required
for an implied-in-fact contract. A seizure, essentially by
definition, lacks mutual intent. Thus, as the government
correctly points out, a seizure pursuant to the govern-
ment’s authority to police the border generally will not
KAM-ALMAZ v. US 8
give rise to an implied-in-fact bailment contract. See
Llamera v. United States, 15 Cl. Ct. 593, 597 (1988); see
also Alde, S.A. v. United States, 28 Fed. Cl. 26, 30 (1993)
(collecting cases and observing that “[t]hese cases evince a
uniform reluctance to find an implied bailment contract
. . . where plaintiff’s property has been seized pursuant to
the Government’s exercise of its police power”). Further,
because Kam-Almaz did not voluntarily deliver his prop-
erty to the government, his complaint fails to allege any
valid consideration. See Llamera, 15 Ct. Cl. at 598. In
summary, we agree with the Court of Federal Claims that
“[t]he ‘purely unilateral act’ of seizing a person’s personal
property does not evidence intent to enter into a bailment
contract.” Kam-Almaz, 96 Fed. Cl. at 88 (quoting Alde, 28
Fed. Cl. at 31).
In support of his bailment claim, Kam-Almaz points
to Muldowan’s statement that the laptop would be seized
“for no more than seven days” and the document receipt
stating that “shipments may be detained for up to thirty
(30) days.” Compl. ¶ 12. Those estimates of when the
seized property might be returned to Kam-Almaz, how-
ever, are insufficient to allege a bailment contract. See,
e.g., Llamera, 15 Cl. Ct. at 597 (noting that even though
the plaintiff received “a receipt” for his seized property,
the facts “did not evidence any intent to enter into a
bailment agreement”). Furthermore, as the relevant
regulation indicates, the fact that Kam-Almaz received a
receipt in no way diminishes the characterization of
Muldowan’s actions as a unilateral seizure. See 19 C.F.R.
§ 162.21(a) (“A receipt for seized property shall be given
at the time of seizure to the person from whom the prop-
erty is seized.”). Kam-Almaz also alleges that correspon-
dence between him and the government supports the
plausibility of his claim for an implied-in-fact bailment
contract. But those letters do not evidence the govern-
9 KAM-ALMAZ v. US
ment’s intent to enter into an enforceable implied-in-fact
contract with Kam-Almaz. See Hanlin, 316 F.3d at 1330
n.3.
We therefore conclude that Kam-Almaz failed to plau-
sibly allege a mutual intent to contract, as an implied-in-
fact contract requires, and further failed to plausibly
allege a voluntary delivery of property, as needed for a
bailment contract. We need not address the other defi-
ciencies in Kam-Almaz’s pleadings identified by the Court
of Federal Claims in order to conclude that the court
correctly dismissed Kam-Almaz’s claim for breach of an
implied-in-fact bailment contract.
Finally, Kam-Almaz contends that the Court of Fed-
eral Claims “treated the issue of the bailment as if such a
claim were legally not viable,” and in so doing disregarded
the Supreme Court’s opinions of Kosak v. United States,
465 U.S. 848 (1984) and Hatzlachh Supply Co. v. United
States, 444 U.S. 460 (1980) (per curiam), as well as our
court’s decision in Acadia Technology, Inc. v. United
States, 458 F.3d 1327 (Fed. Cir. 2006). Br. Pl.-Appellant
Kam-Almaz at 14. Those opinions, however, merely
suggested that the possibility of alleging an implied-in-
fact bailment contract is not foreclosed when Customs
detains property. In Kosak, a case involving a claim
under the Federal Tort Claims Act, the Court noted the
prospect of other remedies, including the possibility of
bringing suit against an individual Customs official who
negligently damaged detained goods and the possibility of
bringing suit “[i]f the owner of property detained by the
Customs Service were able to establish the existence of an
implied-in-fact contract of bailment between himself and
the Service . . . .” 465 U.S. at 860 & n.22. In Hatzlachh,
which similarly involved the effect of a statutory excep-
tion to the Federal Tort Claims Act, the Court observed
that “[t]he absence of Government tort liability has not
KAM-ALMAZ v. US 10
been thought to bar contractual remedies on implied-in-
fact contracts . . . .” 444 U.S. at 465. And finally, in
Acadia, a case involving a takings claim under the Fifth
Amendment, we noted “that an owner [of property de-
tained by Customs] might be able to bring a suit under
the Tucker Act for money damages under a theory of
breach of an implied-in-fact contract of bailment between
the owner and Customs,” but “we express[ed] no opinion
as to whether the facts [alleged] might support such a
claim.” 458 F.3d at 1334 n.2. In the present case, it is
unnecessary to opine whether under some hypothetical
set of alleged facts an implied-in-fact bailment contract
could conceivably arise from the detainment of property
by Customs. We merely hold, on the specific facts alleged
and for the reasons stated, that Kam-Almaz’s complaint
fails to state a claim for an implied-in-fact bailment
contract.
II
We next turn to Kam-Almaz’s claim for a compensable
taking. The Fifth Amendment to the United States
Constitution provides in part, “nor shall private property
be taken for public use, without just compensation.” The
purpose of the Takings Clause is “to bar Government from
forcing some people alone to bear public burdens which, in
all fairness and justice, should be borne by the public as a
whole.” Armstrong v. United States, 364 U.S. 40, 49
(1960).
Kam-Almaz asserts that the Court of Federal Claims
erred by dismissing his takings claim for failure to state a
claim under RCFC 12(b)(6). According to Kam-Almaz, the
government’s seizure of his laptop constituted a physical
taking for public use, for which just compensation is due.
Kam-Almaz further contends that his claim alleges a
compensable taking because, unlike cases such as Bennis
11 KAM-ALMAZ v. US
v. Michigan, 516 U.S. 442 (1996), a crime was not com-
mitted using the seized property. In addition, Kam-
Almaz argues that the reasoning of the Court of Federal
Claims was flawed because it did not define the extent of
the government’s “police power.”
The government, in response, contends that the Court
of Federal Claims lacked jurisdiction over Kam-Almaz’s
takings claim because Kam-Almaz asserted that the
seizure of his laptop was unlawful and unjust. Assuming
the court had jurisdiction, the government asserts that
the court correctly dismissed Kam-Almaz’s claim. Accord-
ing to the government, the complaint failed to allege a
constitutional taking because an authorized seizure of
property pursuant to the government’s police power is not
for public use, and thus cannot be a taking. In addition,
the government argues that property detained or seized
by ICE officials is necessarily taken pursuant to the
government’s police power.
As an initial matter, we agree with Kam-Almaz that
the Court of Federal Claims possessed jurisdiction over
his takings claim. The assertion in Kam-Almaz’s com-
plaint that he suffered “an unjust and unlawful taking of
his property,” Compl. at ¶ 22, could be read in at least two
ways. On the one hand, as the government contends, it
could be an assertion that the government’s seizure was
unauthorized, in which case the district court, not the
Court of Federal Claims, would possess jurisdiction. See
Acadia, 458 F.3d at 1331 (“[The] Tucker Act does not
create jurisdiction in the Court of Federal Claims for a
party contesting the propriety of a seizure.”). On the
other hand, as Kam-Almaz asserts, the complaint may
assert that the government’s seizure, although author-
ized, was compensable under the Fifth Amendment.
Under the liberal standards applied to motions to dismiss,
we conclude that the complaint does not dispute the
KAM-ALMAZ v. US 12
propriety of the seizure itself, but rather seeks to chal-
lenge the failure of the government to compensate Kam-
Almaz for a presumptively lawful seizure. Thus, the
Court of Federal Claims properly exercised its jurisdiction
over Kam-Almaz’s complaint.
Turning to the matter of the court’s dismissal, how-
ever, we agree with the government that Kam-Almaz
failed to state a Fifth Amendment takings claim. Our
precedent is clear: “Property seized and retained pursuant
to the police power is not taken for a ‘public use’ in the
context of the Takings Clause.” AmeriSource Corp. v.
United States, 525 F.3d 1149, 1153 (Fed. Cir. 2008); see
also Acadia, 458 F.3d at 1331–32. Kam-Almaz appears to
recognize as much, arguing that, “[t]o the extent the
Court considers Acadia and AmeriSource to be control-
ling, Kam-Almaz respectfully submits that those cases
should be overruled en banc.” Br. Pl.-Appellant Kam-
Almaz at 43. Of course, a panel of this court is powerless
to overrule a precedent. See El-Shifa Pharm. Indus. Co.
v. United States, 378 F.3d 1346, 1352 (Fed. Cir. 2004).
In any event, Supreme Court precedent also supports
the dismissal of Kam-Almaz’s complaint. In Bennis, the
Court held that Mrs. Bennis, an innocent wife who had a
property interest in a car that was forfeited after her
husband used it in the commission of a crime, did not
have a claim for a compensable taking. 516 U.S. at 452–
53. Mrs. Bennis’s innocence did not factor into the Court’s
takings analysis. Rather, the Court held that “[t]he
government may not be required to compensate an owner
for property which it has already lawfully acquired under
the exercise of governmental authority other than the
power of eminent domain.” Id. at 452. In AmeriSource,
we summarized the Court’s holding in Bennis as follows:
“[in] case[s] involving governmental seizure of property
for law enforcement purposes, the [takings] inquiry
13 KAM-ALMAZ v. US
remains focused on the character of the government
action, not the culpability or innocence of the property
holder.” 525 F.3d at 1154. Accordingly, Kam-Almaz’s
innocence does not convert ICE’s seizure into a com-
pensable taking under the Fifth Amendment. 1
Kam-Almaz further asserts that the government’s sei-
zure was not an exercise of its police power. We disagree.
Customs officers unquestionably have the authority to
search and seize property at our nation’s borders. 2 See,
e.g., 19 C.F.R. §§ 162.6, 162.21. Under the relevant
regulation, “[p]roperty may be seized . . . by any Customs
officer who has reasonable cause to believe that any law
or regulation enforced by Customs and Border Protection
or Immigration and Customs Enforcement has been
violated . . . .” Id. § 162.21. Lawful seizures performed
pursuant to such authority necessarily fall within the
government’s power to police the border. The “police
powers . . . are nothing more or less than the powers of
government inherent in every sovereignty to the extent of
its dominions.” The License Cases, 46 U.S. 504, 583
1 Kam-Almaz relies on Shelden v. United States, 7
F.3d 1022 (Fed. Cir. 1993), in asserting that a takings
claim may lie when property is seized by the government
from an innocent owner pursuant to a criminal investiga-
tion. Shelden, however, was decided before Bennis. As
we noted in AmeriSource, “[t]o the extent that [Shelden]
purports to create any rules with respect to innocent
owners in the takings context, it plainly lacks force.” 525
F.3d at 1156. Kam-Almaz’s reliance on Shelden is there-
fore not persuasive.
2 The parties do not dispute that Agent Muldowan
of ICE served as a Customs officer in performing the acts
alleged in Kam-Almaz’s complaint. See 19 C.F.R.
§§ 162.6, 162.21; see also 19 U.S.C. § 1401(i). We there-
fore have no occasion in this case to distinguish between
Customs and ICE concerning the authority of their offi-
cers to perform border searches and seizures.
KAM-ALMAZ v. US 14
(1847) (opinion of Taney, C.J.). As we have noted,
“[a]lthough the precise contours of the principle are
difficult to discern, it is clear that the police power en-
compasses the government’s ability to seize and retain
property to be used as evidence in a criminal prosecution.”
AmeriSource, 525 F.3d at 1153.
We therefore hold that the Court of Federal Claims
correctly dismissed Kam-Almaz’s takings claim under
RCFC 12(b)(6). Whatever claim Kam-Almaz may have
against the United States, if any, it is not under a breach
of an implied-in-fact contract or a takings theory.
CONCLUSION
We have considered Kam-Almaz’s remaining argu-
ments and find them unpersuasive. The judgment of the
Court of Federal Claims dismissing Kam-Almaz’s com-
plaint is affirmed.
AFFIRMED
United States Court of Appeals
for the Federal Circuit
__________________________
MAJD KAM-ALMAZ,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
__________________________
2011-5059
__________________________
Appeal from the United States Court of Federal Claims
in Case No. 09-CV-007, Judge Lawrence M. Baskir.
__________________________
NEWMAN, Circuit Judge, dissenting.
Mr. Kam-Almaz, a United States citizen, returning to
Dulles International Airport from international business
travel, was accused of no wrongdoing, and his property was
seized, detained, and damaged. He was without fault and
without accusation. The court now condones this action and
injury, denying all remedy for the destruction of his hard
drive and the loss of valuable business information on his
computer.
Mr. Kam-Almaz was travelling abroad for his work with
the International Institute for Psychosocial Development, a
non-profit organization that specializes in post-disaster
mental health education and consulting. On his return to
KAM-ALMAZ v. US 2
Dulles Airport, upon routine Customs inspection his laptop
computer was seized by a Customs agent, the agent stating
that the computer files would be reviewed because he was a
“person of interest.” Mr. Kam-Almaz objected that the
computer contained valuable business data, and the agent
allowed him to copy one file but not all of the computer files.
The agent told Mr. Kam-Almaz that the laptop would be
returned within seven days, and he was given a form receipt
that said his property would be returned within thirty days.
The laptop was not returned for more than two months,
after persistent inquiry by Mr. Kam-Almaz. When re-
turned, the hard drive and many of the computer files had
been destroyed.
Mr. Kam-Almaz was accused of no wrongdoing, but his
property was destroyed while in the custody of the govern-
ment. The issue is not whether the government could have
seized and detained his computer under its police power; the
issue is whether the government, having taken possession of
the computer and destroyed its hard drive and files, had any
responsibility for the property and has any liability for the
loss incurred. The court now condones and ratifies this
injury to Mr. Kam-Almaz’s property, and holds that he is
without remedy. I respectfully dissent.
DISCUSSION
This suit is brought under the Tucker Act. The govern-
ment’s position is that the government action is not a Fifth
Amendment taking of property because the property was
taken in exercise of police power. The government also
states its action did not create an implied-in-fact bailment
contract because the computer was seized without mutual
consent, and that all contracts require consent. My col-
leagues agree, and since the Supreme Court has held that
no remedy is available on a theory of tort, transfer to a
3 KAM-ALMAZ v. US
district court is not available, depriving Mr. Kam-Almaz of
all access to remedy. However, as I shall explain, the court
errs in holding that Mr. Kam-Almaz is without Tucker Act
remedy for the destruction of his property by the govern-
ment.
I. The Contract Claim
The court holds that Mr. Kam-Almaz’s claim for breach
of an implied contract of bailment cannot lie, because his
complaint states that his property was seized. The court
reasons that a “seizure, essentially by definition, lacks
mutual intent,” maj. op. at 7, and thus that the government
cannot be liable on contract theory because it took the
property without consent. This holding is contrary to law
and precedent.
In several rulings, typified by Kosak v. United States,
465 U.S. 848 (1984), the Court held, under circumstances of
Customs seizure, that remedy may be available on a theory
of implied-in-fact contract of bailment. In Kosak the Cus-
toms Service seized antiques and objects of art belonging to
the plaintiff. The property was eventually returned, but
was damaged while in the custody of the Customs Service.
The plaintiff brought suit under the Federal Tort Claims
Act. The Court held that the Tort Claims Act did not apply
to injury to property detained by the Customs Service, but
that “there exists at least one other remedial system,”
including suit under the Tucker Act based on implied-in-fact
contract:
[T]here exists at least one other remedial system
that might enable someone in petitioner’s position
to obtain compensation from the Government. If
the owner of property detained by the Customs Ser-
vice were able to establish the existence of an im-
KAM-ALMAZ v. US 4
plied-in-fact contract of bailment between himself
and the Service, he could bring suit under the
Tucker Act, 28 U.S.C. §1491. See Hatzlachh Supply
Co. v. United States, 444 U.S. 460 (1980).
465 U.S. at 861 n.22. The Court observed that the Kosak
property was “seized,” 465 U.S. at 849, and did not distin-
guish seizure from involuntary detention.
In contrast, my colleagues hold that since Mr. Kam-
Almaz alleged a seizure of his property, he is precluded from
seeking relief under a contract theory. This holding con-
flicts with Kosak, and with Hatzlachh Supply Co., Inc. v.
United States, 444 U.S. 460 (1980), where the Court held
that “the United States may be held liable for breach of an
implied contract of bailment when goods are lost while held
by the United States Customs Service (USCS) following
their seizure for customs violations.” Id. at 461. The Court
did not hold that “seizure” eliminated liability for breach of
an implied contract of bailment of the seized goods. My
colleagues have departed from clear precedent.
These are not new theories of government obligation
and liability. In Alliance Assurance Co. v. United States,
252 F.2d 529 (2d Cir. 1958), suit was brought in the district
court under the Tucker Act for the value of goods which,
“while being inspected for entry into this country, disap-
peared from the possession of the United States Customs.”
Id. at 531. The government was held liable for breach of an
implied contract, the court explaining:
The obligation of the government was not artificially
created by law but rather stemmed from an implied
promise to redeliver the goods as soon as customs
had checked them against the invoice. Such a
promise need not be formalized in a written agree-
5 KAM-ALMAZ v. US
ment or even made the subject of a specific conver-
sation. It arises from the implied promise to return
the goods to the lawful owner after the customs in-
spection has been completed.
Id. at 532. The court held that the government “voluntarily
undertook a bailment of the goods in question, a promise on
its part to use due care during the term of the bailment can
and should be implied.” Id.Contrary to precedent, my colleagues hold that “because
Kam-Almaz did not voluntarily deliver his property to the
government, his complaint fails to allege any valid consid-
eration.” Maj. op. at 8. In Alliance the court explained that
“the owner’s trusting him with the goods is a sufficient
consideration to oblige him to a careful management,” and
that “compelling reason to find consideration exists here
because the bailment, although gratuitous, was compulsory
and for the exclusive benefit of the bailee.” Id. at 533. This
reasoning applies in Customs’ detention of Mr. Kam-Almaz’s
computer and files, for the bailment was compulsory and
solely for the benefit of the government.
The panel majority is incorrect in holding that Mr. Kam-
Almaz’s claim is barred because he “did not voluntarily
‘deliver’ his equipment to Muldowan,” maj. op. at 7, for, as
the Supreme Court and other courts have explained, the
involuntary detention with a promise to return the property
confirms the implied-in-fact bailment. Mr. Kam-Almaz was
given a written receipt for the laptop, stating in writing that
it would be returned within thirty days. This is written
confirmation of the contract of bailment.
The fact that Mr. Kam-Almaz did not voluntarily part
with his laptop does not absolve the government from
liability for the injury to his property. Acquiescence in
KAM-ALMAZ v. US 6
Customs’ seizure for inspection of the property does not
include authorization to destroy the property. As the Court
stated in Kosak, the “owner of property detained by the
Customs Service” has “at least” an implied-in-fact contract
remedy.
Ignoring this direct precedent, my colleagues dismiss
Mr. Kam-Almaz’s contract claim, seeking support in sei-
zures of contraband or illegal activity. In Llamera v. United
States, 15 Cl. Ct. 593 (1988), the Court of Federal Claims
held that the government was not liable on a bailment
theory for loss of a vessel that was seized by the Coast
Guard for violation of law. The Court of Federal Claims
found that the Coast Guard had told the plaintiff that the
Coast Guard “was assuming no responsibility whatsoever
for the vessel” it had seized, and “told plaintiff’s brother that
he could stay with the vessel or have someone board the
vessel to watch it for him.” 15 Cl. Ct. at 597-98. Such
explicit statement of absence of responsibility for the vessel
is far removed from the facts of this case.
The panel majority also places inappropriate reliance on
the criminal seizure in Alde, S.A. v. United States, 28 Fed.
Cl. 26 (1993), where the government seized an aircraft from
the Dominican Republic, on its arrival in Puerto Rico, on
warrant for suspected violation of law. While in govern-
ment control, the aircraft was damaged in a hurricane. The
court held that the government was not liable on either
contract or takings theory, because:
The Customs Service eventually did seek forfeiture
of the aircraft. In light of these facts, it is difficult
to fathom how plaintiff believed the Customs Ser-
vice was indicating that it would safeguard the air-
craft and its contents for later return to plaintiff.
Quite to the contrary, the Customs Service was ac-
7 KAM-ALMAZ v. US
tively seeking to permanently deprive plaintiff of
ownership of the aircraft through forfeiture proceed-
ings.
28 Fed. Cl. at 32. The Alde ruling provides no support for
this court’s holding that the government has no liability for
the destruction of Mr. Kam-Almaz’s detained property, with
no accusation of wrongdoing, before or after the detention.
The record supports Mr. Kam-Almaz’s position that the
Customs agent stated the intent to return his property in a
short time. The Customs agent was told that the computer
held important and valuable business information, for the
government permitted Mr. Kam-Almaz to copy one but not
all of his files. The Complaint states:
At the time of seizure of his computer, Agent Craig
Moldowan orally promised to return it to the Plain-
tiff within seven (7) days after a security review of
its contents was performed by the Defendants.
Agent Moldowan signed a written Customs Form
6051D, evidencing his written offer not to detain the
Plaintiff’s computer for longer than thirty days. . . .
The Defendants breached their implied contract
with Plaintiff when they failed to use due care in a
prompt manner in the handling of the Plaintiff’s
computer, due to a Government, operator-caused
system crash. . . . In addition, the Defendants failed
to mitigate these damages by simply allowing the
Plaintiff to make a copy of his operating software
and data files, as he requested the defendants do.
Applying law and precedent to the pleadings, Mr. Kam-
Almaz has stated a claim for relief on an implied-in-fact
contract theory. The complaint was improperly dismissed
for failure to state a claim.
KAM-ALMAZ v. US 8
II. The Takings Claim
The panel majority also dismisses Mr. Kam-Almaz’s
Fifth Amendment takings claim, on the ground that his
property was “seized and retained pursuant to the police
power.” Maj. op. at 12. However, this court has recognized
that “it is insufficient to avoid the burdens imposed by the
Takings Clause simply to invoke the ‘police powers’ of the
state, regardless of the respective benefits to the public and
burdens on the property owner.” Acadia Tech., Inc. v.
Global Win Tech., Ltd., 458 F.3d 1327, 1330, 1332-33 (Fed.
Cir. 2006) (“[A] taking does not result simply because the
government acted unlawfully, nor does a takings claim fail
simply because the government's conduct is subject to
challenge as unlawful.”).
Although protection of the nation’s borders is a police
activity, when the government in its performance injures an
innocent person, that person is not required to “bear public
burdens which, in all fairness and justice, should be borne
by the public as a whole.” Armstrong v. United States, 364
U.S. 40, 49 (1960). Mr. Kam-Almaz is not excluded from
access to his Fifth Amendment rights, for the Fifth Amend-
ment applies to government actions which seize and injure
private property. See, e.g., Kimball Laundry Co. v. United
States, 338 U.S. 1, 3-4 (1949) (ordering just compensation
when the government took temporary possession of a laun-
dry plant); United States v. General Motors Corp., 323 U.S.
373, 375 (1945) (requiring compensation from the govern-
ment for using a portion of a building leased by the plain-
tiff).
The cases relied on by the panel majority all involve a
seizure of contraband or other violation of law. Neither Mr.
Kam-Almaz nor his property has been accused of or impli-
cated in any wrongdoing. In Acadia, supra, the seized
9 KAM-ALMAZ v. US
property allegedly bore a counterfeit trademark. In Ameri-
Source Corp. v. United States, 525 F.3d 1149, 1150 (Fed.
Cir. 2008), drugs were seized pursuant to charges of “con-
spiracy, unlawful distribution of prescription pharmaceuti-
cals, operating an unregistered drug facility, and conspiracy
to commit money laundering.” In Bennis v. Michigan, 516
U.S. 442 (1996), the Court upheld the forfeiture of an auto-
mobile that had been used in criminal activity, although the
other owner of the automobile was innocent. These cases all
relate to confiscation or seizure based on unlawful acts. In
contrast, no wrong by Mr. Kam-Almaz or his computer was
alleged by the government.
It is incorrect to apply criminal law when no crime is al-
leged. Precedent supports Mr. Kam-Almaz’s pleading of a
takings claim.
III. Other Possible Remedies?
The panel majority refers to “whatever claim Kam-
Almaz may have against the United States,” as if he simply
chose the wrong forum. However, Customs injury cannot be
remedied by tort claim, for in Kosak the Court established
that “the Tort Claims Act does not cover suits alleging that
customs officials injured property that had been detained by
the Customs Service.” 465 U.S. at 862. As mentioned
supra, the Kosak Court stated that “at least” the Tucker Act
might provide a remedy. Id. at 861 n.22.
Whatever the remedial theory, the government is not
absolved of responsibility for its misfeasance in dealing with
its citizens. The Court of Claims “holds and speaks a na-
tion’s conscience,” see tribute to Chief Judge Peele, 48 Ct. Cl.
XXV (Feb 11, 1913). The court has fulfilled this proud
tradition since its inception:
KAM-ALMAZ v. US 10
A unique and permanent contribution that the
Court of Claims has made over the span of its long
life as a public institution is in how it helps make
Government officials accountable to the citizens
whose servants they are, but whose relationship to
their masters is sometimes forgotten. In helping to
inspire a high standard of conduct for Government
officials, it serves the nation well. If there is a con-
stant thread running through the court’s decisions,
it would seem to be in holding the Government and
its officials to a strict code of conduct in their rela-
tions with citizens.
Judge Marion Bennett, in The United States Court of
Claims: A History 170-72 (1978). The History explained
that “[s]uch a court is the flower of a free society.” Id.
Persons injured by unjustified damage to their property
detained by Customs agents are not excluded from access to
the courts. This court’s endorsement of such exclusion
misconstrues traditional and constitutional theory, and
denies the responsibility carved into this court’s entrance,
that: “It is as much a duty of government to render prompt
justice against itself, in favor of citizens, as it is to adminis-
ter the same, between private individuals.” Abraham
Lincoln, Dec. 3, 1861.
I respectfully dissent.