Government drops case to keep $600K seized from former Austintown addiction recovery center

A federal judge has dismissed a civil case brought by the U.S. government against a defunct addiction treatment center in Austintown, ordering the return of more than $600,000 seized during an investigation.

However, the dismissal "without prejudice" doesn't bar the government from refiling the case in the future.

Judge John R. Adams granted the government's motion to dismiss the case on Thursday, resolving a two-year legal battle by the former business to recover the seized funds.

The government had sought to keep the $603,902.82 seized from the bank accounts of California Palms Addiction Recovery Campus in October 2021 after the Ohio Department of Mental Health and Addiction Services terminated the facility's certification.

Former Palms owner Sebastian Rucci had argued that the government had run out of time to reassert its claims and asked for the case to be dismissed "with prejudice." Judge Adams did not address the timeliness issue but noted that the defendants could use it as a defense if the government refiles the case.

The U.S. Attorney's Office had initially sought to keep the seized funds, claiming they were fraudulently obtained through Medicaid. Last week, the office announced it wanted to dismiss its claim after consulting with investigating law enforcement agents.

Judge Adams ordered that the seized funds be returned with interest.

No criminal charges were ever filed in connection with the investigation.