Background
Joshua Luger and Warrior Wash & Emporium, LLC, which operated a car wash and convenience store on the Standing Rock Sioux Reservation in North Dakota, sold products they characterized as industrial hemp. Bureau of Indian Affairs officers seized the products during a December 2023 criminal investigation. Tribal prosecutors later dismissed a drug-sale charge against Luger, and both the special prosecutor and a tribal judge called for the products’ return.
The BIA did not return the products. Plaintiffs alleged that the products had a roughly six-month shelf life and had become worthless. After an earlier Court of Federal Claims action was dismissed under 28 U.S.C. § 1500 while a related district-court case was pending, plaintiffs voluntarily dismissed the district-court action and refiled this single Fifth Amendment takings claim.
The Court’s Holding
Judge Elaine D. Kaplan held that the court had Tucker Act jurisdiction. Plaintiffs asserted a nonfrivolous Takings Clause claim based on the government’s continued retention of property after it allegedly was no longer needed for criminal proceedings. The presence of tort-like allegations and requests for unavailable tort damages did not eliminate jurisdiction over the takings theory.
The court also held that plaintiffs were not required to first seek return of the property under Federal Rule of Criminal Procedure 41(g). But the complaint failed on the merits. The laboratory report plaintiffs attached showed total delta-9 THC of 23.0103%, far above the 0.3% limit for hemp. The court treated the products as marijuana and therefore contraband; their seizure and retention under the government’s police power was not a compensable taking. The court denied the Rule 12(b)(1) motion, granted dismissal under Rule 12(b)(6), and dismissed the complaint with prejudice.
Key Takeaways
- A nonfrivolous federal takings claim can support Court of Federal Claims jurisdiction even when the complaint also includes tort-like allegations.
- Rule 41(g) does not require a claimant to exhaust a property-return remedy before bringing this Tucker Act takings claim.
- An exhibit attached to the complaint controls over contradictory allegations; here, the lab report established that the products were contraband.
Why It Matters
The decision distinguishes jurisdiction from merits in post-seizure takings litigation. A claimant may invoke the Takings Clause based on retention of seized property without first pursuing Rule 41(g), but cannot obtain just compensation for property that is contraband and retained pursuant to the government’s police power.