United States of America v. Cline et al

1
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
________________________________________
UNITED STATES OF AMERICA,
v. 	1:25-CV-1576 (GTS/DJS)
DOUGLAS CLINE; and JOANNE CLINE,
Defendants.
_________________________________________
APPEARANCES: 	OF COUNSEL:
OFFICE OF THE UNITED STATES ATTORNEY 	CHRISTOPHER R. MORAN, ESQ.
FOR THE NORTHERN DISTRICT OF NEW YORK 	ADAM J. KATZ, ESQ.
Counsel for the Government 	Assistant United States Attorneys
445 Broadway, Room 218
Albany, NY 12207-2924
DOUGLAS CLINE
Defendant, Pro Se
55 Railroad Place, Apt. 523
Saratoga Springs, NY 12866
JOANNE CLINE
Co-Defendant, Pro Se
PO Box 1932
Bolton Landing, NY 12814
GLENN T. SUDDABY, United States District Judge
DECISION and ORDER
Currently before the Court, in this civil forfeiture proceeding by the United States
(“Government”) against Douglas and Joanne Cline (“Defendants”), are the following: (1)
Defendants’ motions to dismiss the Government’s Complaint for failure to state a claim; (2)
United States Magistrate Judge Daniel J. Stewart’s Report-Recommendation recommending that
Defendants’ motions to dismiss be denied; (3) Defendants’ Objections and Amended Objections
Case 1:25-cv-01576-GTS-DJS Document 52 Filed 04/17/26 Page 1 of 6

2
to both that Report-Recommendation and Magistrate Judge Stewart’s Order granting the
Government’s Application for a Prejudgment Writ of Attachment in the amount of $875,000.00;
and (4) the Government’s response to Defendants’ Objections and Amended Objections. (Dkt.
Nos. 3, 16, 17, 32, 39, 44-47, 49.) For the reasons set forth below, the Court accepts and adopts
Magistrate Judge Stewart’s Report-Recommendation in its entirety and denies Defendants’
motions to dismiss, and the Court affirms Magistrate Judge Stewart’s Order granting the
Government's Application for a Prejudgment Writ of Attachment in the amount of $875,000.00.
Generally, in their Objections, Defendants submit approximately 26 single-spaced pages
of challenges that essentially contain a half-dozen arguments, sometimes repetitive but always
organized: (1) Magistrate Judge Stewart misapplied a pleading-sufficiency standard to the
Government’s application for a Prejudgment Writ of Attachment, instead of the required showing
of probable validity; (2) Defendants were not afforded adequate due process before the Writ was
issued; (3) the Writ is unsupported by adequate evidence of constructive fraud; (4) the Writ fails
to give sufficient weight to a judicially sanctioned divorce transfer; (5) the Writ is excessive and
not narrowly tailored; and (6) the Writ is unsupported by a finding that Defendant Joanne Cline
did not accept the property in good faith. (Dkt. Nos. 44, 45, 46, and 47.) Each of these
arguments is asserted with the misplaced confidence that has become a hallmark of an output of
a generative artificial intelligence tool.
After carefully considering these arguments, the Court rejects them for each of the four
reasons stated in the Government’s response. (Dkt. No. 49.) First, as the Government argues,
contrary to Defendants’ argument that Magistrate Judge Stewart misapplied a pleading-
sufficiency standard to the Government’s application for a Prejudgment Writ of Attachment
Case 1:25-cv-01576-GTS-DJS Document 52 Filed 04/17/26 Page 2 of 6

3
pursuant to 28 U.S.C. § 3001(a)(2), in fact he applied the correct records-based probable-validity
standard, and in doing so correctly he relied on an extensive evidentiary record. (Id. at 1-2.) The
Court adds that Defendants (or the generative artificial intelligence tools that they used) place
much weight on the following sentence from page 19 of the Report-Recommendation: “[T]he
Government has satisfied its burden, primarily for the reasons identified in the preceding analysis
in connection with the Defendants’ Motions to Dismiss.” 	(See, e.g., Dkt. No. 44, at 1, 3; Dkt.
No. 47, at 1, 3; cf. Dkt. No. 46, at 5 [repeating Def. Douglas Cline’s argument].) However, in
addition to neglecting to acknowledge the importance of the adverb “primarily” in that sentence,
Defendants neglect to acknowledge the next sentence of the Report-Recommendation: “The
Government has now produced, in evidentiary form, records and testimony regarding [seven
listed facts].” (Dkt. No. 39, at 19 [emphasis added].) 	Even a cursory analysis of the Report-
Recommendation demands a candid acknowledgment that Magistrate Judge Stewart relied on
admissible record evidence in granting the Government’s application for a Writ. (Id. at 16-17, 19
[citing the sworn affidavit of Dr. Martin Schaefer and the “records and testimony” attached at
Dkt. No. 3].)
Second, as the Government argues, contrary to Defendants’ argument that they did not
receive due process, in fact they received the process required by 28 U.S.C. § 3101(d) through
their pre-noticed hearing on December 9, 2025, at which (a) they neither submitted contrary
evidence nor identified specific evidence they were unable to present, and (b) Defendant Joanne
Cline declined to provide assurances that she would not dispose of the property in question.
(Dkt. No. 49, at 2.) The Court adds that a review of the 37-page transcript from that 45-minute
hearing confirms these facts. (See generally Dkt. No. 36.)
Case 1:25-cv-01576-GTS-DJS Document 52 Filed 04/17/26 Page 3 of 6

4
Third, as the Government argues, contrary to Defendants’ argument that the standard of
review of Magistrate Judge Stewart’s Order granting the Government’s application for a
Prejudgment Writ of Attachment is de novo, in fact that standard of review is the deferential one
appropriate during an appeal from a non-dispositive order. (Dkt. No. 49, at 2-3.)1 The Court
adds that Magistrate Judge Stewart’s thorough non-dispositive Order easily survives that
deferential review for the reasons stated therein. (See generally Dkt. No. 39, at 13-21.) The
Court adds also that, because Defendants’ Objections specifically challenge only this non-
dispositive Order (and do not assert any specific arguments – new or not – with regard to
Magistrate Judge Stewart’s recommendation regarding Defendants’ motions to dismiss), that
recommendation is subject to only a clear-error review,2 which it also easily survives for the
reasons stated therein. (Id. at 4-13.)
1 	Specifically, in reviewing an appeal from a magistrate judge’s non-dispositive order, the
court “must modify or set aside any part of the order that is clearly erroneous or is contrary to
law.” Fed. R. Civ. P. 72(a); see also Statewide Aquastore, Inc. v. Pelseal Tech., LLC, 06-CV-
0093, 2010 WL 610685, at *2 (N.D.N.Y. Feb. 17, 2010) (Scullin, J.) (“When considering an
appeal from a magistrate judge’s ruling on a non-dispositive matter, a district court will modify
or set aside any portion of the magistrate judge’s ruling that it finds to be ‘clearly erroneous or
contrary to law.’”) (quoting 28 U.S.C. § 636[b][1][A]; Fed. R. Civ. P. 72[a]). A finding is clearly
erroneous if “‘on the entire evidence,’ [the reviewing court] is ‘left with the definite and firm
conviction that a mistake has been committed.’” Snyder v. Louisiana, 552 U.S. 472, 487 (2008)
(citing Easley v. Cromartie, 532 U.S. 234, 242 [2001] [quoting United States v. United States
Gypsum Co., 333 U.S. 364, 395 (1948)]); accord, United States v. Isiofia, 370 F.3d 226, 232 (2d
Cir. 2004). An order is contrary to law if “it fails to apply or misapplies relevant statutes, case
law or rules of procedure.” New York v. Salazar, 08-CV-0644, 2011 WL 1938232, at *4
(N.D.N.Y. Mar. 8, 2011) (Kahn, J.); Tompkins v. R.J. Reynolds Tobacco Co., 92 F. Supp.2d 70, 74
(N.D.N.Y. 2000) (Scullin, J.)
2 	When a specific objection is made to a portion of a magistrate judge's report-
recommendation, the Court subjects that portion of the report-recommendation to a de novo
review. Fed. R. Civ. P. 72(b)(2); 28 U.S.C. § 636(b)(1)(C). To be “specific,” the objection must,
with particularity, “identify [1] the portions of the proposed findings, recommendations, or report
to which it has an objection and [2] the basis for the objection.” N.D.N.Y. L.R. 72.1(c).
Case 1:25-cv-01576-GTS-DJS Document 52 Filed 04/17/26 Page 4 of 6

5
Fourth, as the Government argues, contrary to Defendants’ argument that Magistrate
Judge Stewart’s Order granting the Government’s application for a Prejudgment Writ of
Attachment is neither supported by evidence nor narrowly tailored, that Order both (a) is
supported by a demonstration of both substantial potential liability and a recent transfer of a
high-value asset for nominal consideration, and (b) neither transfers possession nor prevents use
but leaves open proposed alternatives at the time of sale (including escrow of proceeds). (Id. at
3.) The Court adds that Magistrate Judge Stewart – clearly out of solicitude to Defendants –
went out of his way to remind the Court of its power to reduce the amount of the attachment
upon the necessary showing at the appropriate time. (Dkt. No. 49, at 20-21.)
To the above-stated analysis, the Court adds two final points. First, with regard to
Defendants’ arguments about the effect of Defendants’ divorce decree, Magistrate Judge Stewart
adequately addressed that argument. (Dkt. No. 39, at 12-13 [relying on United States v.
Schippers, 982 F. Supp. 2d 948, 953-54 (S.D. Iowa 2013)].) Second, with regard to Defendant
Conversely, when a general objection is made to a portion of a magistrate judge's report-
recommendation, the Court subjects that portion of the report-recommendation to only a clear
error review. Fed. R. Civ. P. 72(b)(2),(3); Fed. R. Civ. P. 72(b), Advisory Committee Notes: 1983
Addition. Similarly, when an objection merely reiterates the same arguments made by the
objecting party in its original papers submitted to the magistrate judge, the Court subjects that
portion of the report-recommendation challenged by those arguments to only a clear error
review. See Mario v. P&C Food Markets, Inc., 313 F.3d 758, 766 (2d Cir. 2002) (“Merely
referring the court to previously filed papers or arguments does not constitute an adequate
objection under either Fed. R. Civ. P. 72(b) or Local Civil Rule 72.3(a)(3).”); Camardo v. Gen.
Motors Hourly-Rate Emp. Pension Plan, 806 F. Supp. 380, 382 (W.D.N.Y. 1992) (explaining that
court need not consider objections that merely constitute a "rehashing" of the same arguments
and positions taken in original papers submitted to the magistrate judge). Finally, when no
objection is made to a portion of a report-recommendation, the Court subjects that portion of the
report-recommendation to only a clear error review. Fed. R. Civ. P. 72(b), Advisory Committee
Notes: 1983 Addition. When performing such a “clear error” review, “the court need only satisfy
itself that there is no clear error on the face of the record in order to accept the recommendation.”
Id.
Case 1:25-cv-01576-GTS-DJS Document 52 Filed 04/17/26 Page 5 of 6

6
Joanne Cline’s argument about good faith, Magistrate Judge Stewart also adequately addressed
that argument. (Id. at 20 [citing United States v. DuBois, 23-CV-80279, 2023 WL 9692124, at
*1-6 (S.D. Fla. Nov. 14, 2023)].)
For all of these reasons, the Court accepts and adopts Magistrate Judge Stewart’s Report-
Recommendation in its entirety, denies Defendants’ motions to dismiss, and affirms Magistrate
Judge Stewart’s Order granting the Government's Application for a Prejudgment Writ of
Attachment in the amount of $875,000.00.
ACCORDINGLY, it is
ORDERED that Magistrate Judge Stewart’s Report-Recommendation (Dkt. No. 39) is
ACCEPTED and ADOPTED in its entirety; and it is further
ORDERED that Defendants’ motions to dismiss (Dkt. Nos. 16, 17, 32) are DENIED;
and it is further
ORDERED that Magistrate Judge Stewart’s Order granting the Government's application
for a Prejudgment Writ of Attachment in the amount of $875,000.00 (Dkt. No. 39) is
AFFIRMED.
Dated: April 17, 2026
Syracuse, New York
Case 1:25-cv-01576-GTS-DJS Document 52 Filed 04/17/26 Page 6 of 6