As a Police Officer in NJ, I say to you this was a very wrong incident. I strongly advise that in addition to your lawsuit that you contact Internal Affairs or whatever they call it in NY. Additionally take notes so that you don't forget details later, like who at work that night might have witnessed you with those specific lost knives. Short of a miracle, you wont get those knives back, but you might very well get the money back to replace them. I know it is a ton of aggravation and effort, but make sure you go forward with this. As a Law Enforcement Officer, this stuff disgusts me. There are bad apples in every career and they tarnish what the rest do right on a daily basis.
As to some other comments here. Don't worry about them doctoring the report, people watch too many movies. What might happen is that the arrest inventory will omit those knives, that is likely based on the situation that you described. Did they inventory in front of you? They are not required to, but sometimes do to get a more accurate description of items. Did u sign a property sheet that listed what was on your person when it was taken from you? Did u sign a property sheet when it was returned to you?
As to some other comments here. Don't worry about them doctoring the report, people watch too many movies. What might happen is that the arrest inventory will omit those knives, that is likely based on the situation that you described. Did they inventory in front of you? They are not required to, but sometimes do to get a more accurate description of items. Did u sign a property sheet that listed what was on your person when it was taken from you? Did u sign a property sheet when it was returned to you?