Case 2:14-mc-01288-DRH Document 14 Filed 01/20/15 Page 1 of 1 PageID #: 68 U.S. Department of Justice United States Attorney Eastern District of New York LDM:DL F.# 2014V02371 610 Federal Plaza Central Islip, New York 11722 January 20, 2015 VIA ECF Honorable Denis R. Hurley United States District Court 100 Federal Plaza Central Islip, New York 11722 Re: In the Matter of the Seizure of $446,651.11 Misc. No. 14-1288 (DRH) Dear Judge Hurley: Enclosed for the Court’s approval is the Stipulation and Proposed Order of Settlement (the “Stipulation”) for this action, executed by both petitioner Bi-County Distributers, Inc. (“Bi-County”) and the United States. The Stipulation resolves and renders moot the motion filed by Bi-County, pursuant to Rule 41(g) of the Federal Rules of Criminal Procedure, seeking the return of $446,651 seized from Bi-County’s account. As set forth more fully in the Stipulation, the United States has agreed to return the funds to Bi-County, and Bi-County has, among other things, waived any claims to attorney’s fees, interest, or any damages that it claims were caused by the seizure. Pursuant to the Stipulation, the parties further agree that the action is dismissed upon the Court’s execution of the Stipulation. We appreciate the Court’s consideration of the enclosed. Respectfully submitted, LORETTA E. LYNCH United States Attorney By: Encl. cc: Lawrence Salzman (By ECF, with encl.) s/ Diane Leonardo Diane Leonardo Assistant United States Attorney (631) 715-7854 Case Document 14-1 Filed 01/20/15 Page 1 of 7 PageID 69 2014VO237I 2012VGI 126 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK nun?nu. - In the Matter of the Seizure of STIPULATION AND ORDER OF SETTLEMENT FOUR HUNDRED FORTY SIX THOUSAND SIX HUNDRED FIFTY ONE DOLLARS AND ELEVEN CENTS MISC. 14-1288 (DRH) 1) IN US. CURRENCY FROM NEW YORK COMMERCIAL BANK, ACCOUNT i, LOCATED IN RONKONKOMA, NEW YORK, HELD IN THE NAME OF DISTRIBUTORS, INC. bun-n? WHEREAS, on or about May 21, 2012, the Honorable Arlene R. Lindsay, United States Magistrate Judge for the Eastern District of New York, issued a warrant (the ?Wat-rant?) authorizing the seizure of any and all funds on deposit at New York Commercial Bank Account number ending in 907E (the ?Account?) held in the name of Bi-County Distributors, Inc. up to and including the sum of One Million Four Hundred Seventy?Six Thousand Nine Hundred Ninety?Two dollars and no cents and all proceeds traceable thereto, ?nding probable cause to believe that such funds were subject to forfeiture to the United States pursuant to 31 11.8.0. 5317, as property involved in violations of 31 U.S.C. 5324; WHEREAS, pursuant to the Warrant, on or about May 21, 20} 2, agents of the United States Department of Treasury, Internal Revenue Serxtice (the seized the sum of $446,651.12 in United States currency (the ?Seized Funds?) from the Account; WHEREAS, the United States provided Bi~County with actual notice of the seizure on or about May 22, 2012; Case Document 14-1 Filed 01/20/15 Page 2 of 7 PageID 70 In the Matter of $446,651,111, CV-14-1288 (DRH), Stipulation and Order of Settlement WHEREAS, between May 2012 and May 2014, the United States and BiuCounty, through its attorney at the time, Joseph Potashnik, commenced and engaged in settlement negotiations, which included Bi~County?s retention of a forensic accountant that analyzed the cash activity in the Account and the income that Bi-County had reported to the IRS in its corporate tax returns and preparation of a report that Bi-County submitted to the United States during the settlement negotiations in this case; WHEREAS, on or about October 16, 2014, Bi~County, through its current undersigned counsel, filed the above-captioned action seeking return of the Seized Funds pursuant to Rule 41(g) of the Federal Rules of Criminal Procedure; and WHEREAS, the United States acknowledges that neither Bi-County nor its employees has been charged with any crime in connection with the Seized Funds. IT is HEREBY STIPULATED AND ORDERED as follows; I. Bi-County represents that it possesses an exclusiye ownership interest in the Seized Funds. 2. Upon the Court?s approval of this Stipulation and Order, the United States shall return the Seized Funds to Bi-County, subject to the provisions of paragraphs 9 and 10, below. 3. Iii-County, as well as Jeffrey Hirsch, Mitchell Hirsch, Richard Hirsch, and Cindy Hirsch (collectively, the ?Hirsches?), expressly acknowledge that they have been advised of the requirements of the Bank Secrecy Act, codi?ed at 31 U.S.C. 53} 1?5330, and its implementing regulations, codified at 31 CPR. Chapter X, including, but not limited to, the prohibition against structuring ?nancial transactions to avoid the ?ling of Currency Transaction Reports, and 2 Case Document 14-1 Filed 01/20/15 Page 3 of 7 PageID 71 the Matter of $446,651.11, CV-14-1288 (DRH), Stipulation and Order of Settlement (ii) the requirement to file IRS Forms 8300 for all cash receipts in excess of $10,000 arising from a single transaction or two or more related transactions. 4. The United States and Bi?County agree, understand, and acknowledge that neither of the parties to this agreement admit to or acknowledge any liability or wrongdoing whatsoever. Neither this settlement nor any payment hereunder is to be construed as an admission of liability or wrongdoing by either party. 5. Bi-County and all of the Hirsches agree to release, remise and forever discharge, the United States and its agencies, agents, of?cers, and employees, past and present (the ??Releasees?), from all claims or causes of action which Bi?County and all of the Hirsches, as well as any of their agents, assigns, representatives, and successors ever had, now have, or hereafter may have against the Releasees relating in any manner to the seizure, restraint, forfeiture, and return of the Seized Funds. Further, in the event a third party claims an interest in the Seized Funds, Bi-County agrees that it shall hold the United States and the Releasees harmless from such claims, and that Bi-County shall indemnify the United States and its agencies, agents, of?cers, and employees, past and present; if demanded by the United States, defend any such claim; and provide evidence and testimony necessary to the defense of such claim. 6. The United States shall not take any further action to effect the forfeiture of the Seized Funds in any civil or criminal proceeding in connection with the alleged underlying structuring offenses. 7. Except as expressly contemplated in the agreement, the parties agree that the settlement cannot be'used as a basis for any statutory or constitutional defense in any other civil, criminal, or administrative action; Case Document 14-1 Filed 01/20/15 Page 4 of 7 PageID 72 In the Matter of $446,651.11, Stipulation and Order of Settlement 8. Except as otherwise indicated herein, the United States does not release Bi-County or any of the Hirsches from: any potential criminal liability; any criminal, civil or administrative claims arising under Title 26, US. Code (Internal Revenue Code); and/or any liability to the United States (or any agencies thereot) under any other statute, law or regulation. 9. Bi-County acknowledges that federal law requires the Department of the Treasury and other disbursing of?cials to offset Federal payments to collect delinquent tax and non-tax debts owed to the United States, and certain other debts owed to individual states, including delinquent child support. The IRS also levies disbursing of?cials to collect delinquent tax debts. Agencies submitting debts for collection by offset or levy send due process noti?cation to the last known address prior to submission. If a payment made'to a party is reduced to collect a debt, the Department of Treasury will send a notice to the party at the last address provided by the party to the governmental agency or entity to whom the offset payment is made. If a party believes that its payment may be subject to an offset,? the party may contact the Treasury Department at 1-800-304-3107. - 10. The parties, including all of the Hirsches, agree that they each shall bear their own costs and attorney?s fees and, accordingly, waive any and all rights they may have to recover attorney?s fees and/or interest under the Equal Access to Justice Act, the Civil Asset Forfeiture Reform Act, or any other legal or statutory bases. 1 1. Jeffrey Hirsch, President of Eli-County, and the undersigned counsel for Bi-County further represent that they are authorized to execute this and all other documents necessary to effectuate the settlement of the above-captioned action on behalf of Bi?County and the Hirsches. [Bi-County shall send to the undersigned counsel for the United States two executed copies of this 4 Case Document 14-1 Filed 01/20/15 Page 5 of 7 PageID 73 In the Matter Stipulation and Order of Settlement Stipulation and Order, as well as a completed and typed ACH form (sections 2 and 3). Upon receipt thereof, counsel for the United States shall execute this Stipulation and Order, and submit it to the Court for its approval. The Seized Funds returned to Bi.?Couuty will be in the form of an ACE payment made payable as indicated in the completed ACH form returned to the United States and routed to the bank as provided by Bi~County and as indiCated on the ACH form. 12. Upon entry of this Stipulation and Order, this action is dismissed with prejudice. The Clerk of the Court is directed to close this action. 13. The District Court shall retain jurisdiction of this action to enforce this Stipulation. Dated: Central lslip, New York January 2015 LORETTA E. United States Attorney Eastern District of New York Attorney for United States of America EWmal Pla 5?h F1 e; tral Einp, Diane C. Leonaltdeqj Assistant US Attorney (631)715-7854 By: Dated: Arlington, Virginia January?, 2015 7 Institute for Justice Attorneys for Bi-County Distributors, Inc. 901 N. Glebe Road, Suit 900 Ayon, VA (Ia/awrencekG. Salz?an (703) 682-9320 BY: Case Document 14-1 Filed 01/20/15 Page 6 of 7 PageID 74 In the Matter {Ti/?144288 (DRH), Stipulation and Order of Settlement I have read and understand the above. AGREED AND CONSENTED TO BY: f; "a ,1 Je?l?fr??r irsch,'lndividually and as President on behalf of Bi-County Distributors, Inc. Acknowledgement On the day of in the year 2015, Jeffrey Hirsch known to me, the undersigned, or proven to me on the basis of isfactory evidence to be the individual whose name is subscribed to above, personaily appeared before me and acknowledged to me that he executed the same in his personal capacity and as I?resident on behalf of Bi~County Distributors, Inc. and that by his signature on the he executed the instrument on behalf of Bi?County. M. {m Notary pm, smemm: No, 0160313183 Quali?adin-Stm County Commission Expims 0331mm 1 have read and understand the above. AGREED AND CONSENTED TO BY: sex we ?aw Mitchell Hirsch, IndXVidnally and as Vice President on behalf of Bi-County Distributors, inc. Acknowledgement On the day of x1, in the year 2015, Mitchell Hirsch known to me, the undersigned, or prov to me basis of satisfactory evidence to be the individual whose name is subscribed to above, personally appeared before me and acknowledged to me that he executed the same in his personal capacity and as Vice President on behalf of Bi~County Distributors, Inc. and that by his signature on the within instrument, he executed the instrument on behalfof Bi-County. Nicote M. Notary Public, of New York (7. tarnuokbix\ No. 0168818188 Quafi?ed in Suf?ok County Commission Expires 0311120 1 a Case Document 14-1 Filed 01/20/15 Page 7 of 7 PageID 75 In the Matter of $445,651.11, Stipulation and Order of Settiement I have read and understand the above. AGREED AND CONSENTED TO BY: j! Richard Hirsch, Indivi?dualiy and as Treasurer on behalf of Bi-County Distributors, Inc. Acknowledgement Viv-c: in the year 2015, Richard Hirsch known to me, the undersigned, or pro to me - the basis of satisfactory evidence to be the individoai whose name is subscribed to above, personally appeared before me and acknowledged to me that he executed the same in his personal capacity and as Treasurer on behalf of Bi-County Distributors, Inc. and that by his signature on the within instrument, he executed the instrument on behalf of Bi-County. (D- Nimitz M. ?omalez We?? York Qualified in Suf?ok County thtwo?ixpires DENIM) 1% I have read and understand the above AGREED AND CONSENTED TO BY: [we Cindy/Hirsch/ Acknowledgement On the day of in the year 2015, Cindy Hirsch known to me, the undersigned, or proven to me on the basis of atisfactory evidence to be the individuai whose name is subscribed to above, personally appeared before me and acknowledged to me that she executed the same. Notary Public . Stats at TARY c/ so. awessrasaz Quatt?od tn Su?otit Bounty I . SO ORDERED: On this day of January, 2015 HONORABLE DENIS R. HURLEY UNITED STATES DISTRICT JUDGE