Earlier this year, Radu and Diana Nemes, Romanian nationals living in Yelm, were arrested over charges of stealing $68 million in taxes from the Romanian government.
Now, the federal government has its sights set on assets it says the Nemeses’ bought with the proceeds of the alleged overseas tax scheme. But local residents have come forward, filing claims to property the federal government seeks to forfeit.
Doug and Kim McCrea, owners of Eagleview Hill LLC, the local Salida winery, have filed a claim stating their interest in the company, which Diana Nemes invested in at one time. They argue in court documents that Nemes failed to meet her obligation to the company and had a much smaller stake than the federal government claims.
James Capezio is attempting to counter-sue the federal government over its attempt to forfeit a business complex on Burnett Road in Yelm, arguing the government’s seizure of funds used to maintain the property is crippling business.
Gregory Simmons has claimed ownership of property on Lake Cushman in Shelton.
And Diana Nemes herself is fighting what she characterizes in court documents as unlawful attempts to forfeit her property.
A hearing on Nemes’ motion to dismiss the forfeiture proceedings is scheduled for 10:30 a.m. Sept. 4 in U.S. District Court in Tacoma.
Diana Nemes seeks to dismiss the complaint, arguing in court documents the government failed to allege an offense covered by a multilateral treaty, thus failing to state a valid forfeiture claim. The government improperly cited a bilateral treaty in its initial complaint, Nemes states in court documents. The government writes that Nemes’ alleged crimes in the United States — setting up and supporting an organized criminal group — are subject to the United Nations Convention against Transnational Organized Crime.
Nemes argues in court documents the treaty does not apply because an organized criminal group did not exist outside of the alleged tax scheme.
Nemes also alleges the government has exaggerated the scope of the Nemeses’ alleged crimes. She cites as an example the government’s claim the couple and their co-conspirators illicitly sold about 90,000 tons of diesel fuel over a one-year period.
“That is hardly even possible,” Nemes states in court documents, writing that a typical diesel fuel tanker holds between 5,500 and 11,600 gallons of diesel, with one 5,500 gallon tanker holding approximately 19.5 tons of fuel.
“The number of truckloads needed to carry 990,000 tons of diesel thus would be over 50,000. To reach that volume in one year would require 140 truckloads per day, every day of the year. That is impossible, and it is flatly contradicted by information the Romanians themselves alleged elsewhere in their extradition request.”
The government’s position is lawless, Nemes claims.
“The rhetorical thrust of its argument is the Nemeses are bad people and so the government deserves to take Diana Nemes’ property, regardless of the law,” Nemes’ lawyer wrote. “It asks this Court to bend the rules of pleading, and to adopt expansive interpretations of statutes and international treaties, in order to facilitate the taking. This ‘end justifies the means’ approach should not be condoned, not least because it ignores the rule of law that the government is supposed to be protecting and proliferating in countries such as Romania.”
Doug and Kim McCrea
The McCreas argue in court documents that Diana Nemes defaulted on her investment in Eagleview Hill, LLC, by failing to invest the full amount agreed on — $300,000 — to obtain a two-thirds interest in the company. Nemes only invested $130,000 and as a result, Nemes’ interest in the company is less than 33 percent, not the 67 percent claimed by the government, according to the McCreas.
The company also claims an interest in wine inventory and sales revenue from the sale of bottled wine.
“As a result of the promised investment of Diana Nemes into the Company and the business plan promoted by Diana Nemes and her business manager, Greg Simmons, the Company made significantly larger purchases from grape growers in 2013 resulting in the production of substantially more bulk wine than the Company could otherwise promise to purchase,” the McCreas state in court documents.
Because of Nemes’ default, the company does not have sufficient money to pay $60,000 it owes grape growers, who now have a lien on the work progress and accounts receivables and products of the company, according to court documents.
James Capezio, both individually and on behalf of the company Mt. Rainier Properties, LLC, denies the property at 9144 Burnett Road SE in Yelm is subject to forfeiture and seeks dismissal of the forfeiture complaint and the release of money seized by the government, and the forfeiture of interests claimed by people other than Capezio, including Simmons, Li Yew Heah, Diana Nemes and Magdalena Properties, LLC.
The property is a “small commercial office complex and the sole asset of Mt. Rainier Properties LLC,” court documents state.
Capezio denied in court documents that Mt. Rainier Properties is a shell corporation, as alleged by the government. The members of the company are Capezio and a company called Magdalena Properties, which is owned by Simmons and Heah, according to court documents.
The Burnett Road property was purchased in 2013 for $728,000, according to court documents.
Capezio argues the Burnett Road property is “perishable or at risk of deterioration, decay, or injury” because the government has failed to release seized funds to ensure its maintenance and operation, court documents state. Capezio also argues in court documents forfeiture of the property would be “disproportionate to the offense” violating the excessive fines clause of the Eighth Amendment.
Capezio also argues that Magdalena Properties has defaulted on its operating agreement with Mt. Rainier Properties, including by failing to provide funds agreed to under the operating agreement and failing to renew its registration as an LLC, according to court documents.
U.S. Attorneys sought to dismiss Capezio’s counterclaims, stating in court documents Capezio’s counterclaim “lacks merit, because all the United States did with respect to the civil forfeiture action was to give notice of its forfeiture action against the real property.
“The property was not seized and Mr. Capezio continues to exercise full control over it, pending resolution of the forfeiture action or an interlocutory sale of the property while that action is still pending,” according to court documents.
The government has not seized the business, Mt. Rainier Properties, or its bank accounts, and Capezio has the opportunity to protect his interest in the property without interference by the government, U.S. Attorneys argue.
“Capezio is essentially attacking the seizure by the United States of funds held by or on behalf of a separate entity, Magdalena Properties, LLC, an entity in which neither Mr. Capezio nor Mt. Rainier Properties has an ownership interest,” they state. “Therefore, Claimant James Capezio, individually, and on behalf of Mt. Rainier Properties, LLC lacks standing to contest the forfeiture of the Magdalena funds. At most he is a potential creditor of Magdalena Properties based on claims of breach of contract, claims expressly asserted by Capezio and Mt. Rainier in their answer as cross claims against claimants Diana Nemes and Gregory Simmons.”
The government also argues that because the case is an “in rem” action, the property is the defendant, and Capezio and Mt. Rainier Properties are claimants, not defendants, and therefore cannot assert a counterclaim under federal rules.
They further argue the United States as a plaintiff is “protected from suit by the doctrine of sovereign immunity, which only permits such legal actions against the United States for which the government consents to be sued. The United States has not consented to be sued, and there is no exception to sovereign immunity based on the government’s initiation of a civil forfeiture action or based on claims of tortious interference with contractual rights, the gravamen of the counterclaim of Capezio and Mt. Rainier Properties, LLC.”
According to the government, an exception to the Federal Tort Claims Act waiver of sovereign immunity “expressly bars any claim against the United States for ‘interference with contract rights.’”
Greg Simmons claims in court documents he is the owner of the properties located at 320 and 340 North Cushman Ridge Drive in Shelton.
Simmons also claims to be the owner of the property on Burnett Road. According to court documents filed by Simmons, Mt. Rainier Properties is listed as the owner. Simmons claims in court documents he is a 5 percent owner in the company.