United States of America v. Six Thousand Two Hundred Seven ($6,207) Dollars in United States Currency
MEMORANDUM OPINION AND ORDER granting the Government's 47 Motion for Summary Judgment; directing the Government to file a proposed decree of forfeiture on or before October 1, 2010; cancelling the pretrial conference and trial. The Court will enter a separate final judgment. Signed by Hon. Chief Judge Mark E. Fuller on 9/24/2010. term: Final Pretrial Conference set for 09/29/2010; Non-Jury Trial set for 10/25/2010 (br, ) (Additional attachment(s) added on 9/24/2010: # 1 Civil Appeals Checklist) (br, ).
United States of America v. Six Thousand Two Hundred Seven ($6,207) ...n United States Currency
IN THE UNITED STATES DISTRICT COURT F O R THE MIDDLE DISTRICT OF ALABAMA N O R T H E R N DIVISION U N IT E D STATES OF AMERICA, ) ) P la in tif f , ) v. ) ) S IX THOUSAND TWO HUNDRED ) S E V E N ($6,207) DOLLARS IN UNITED ) S T A T E S CURRENCY ) ) D e f e n d a n t. )
C A S E NO. 2:08-cv-999-MEF (W O PUBLISH)
M E M O R A N D U M OPINION AND ORDER In this lawsuit brought pursuant to 21 U.S.C. § 881(a)(6), Plaintiff United States of A m e ric a (the "Government") seeks forfeiture of six thousand two hundred seven dollars ($ 6 ,2 0 7 ) in United States currency (the "defendant money"). (Doc. # 1). The G o v e rn m e n t alleges that the defendant money, seized during the arrest of Sylvester V a u g h n ("Vaughn") for drug trafficking and distribution of a controlled substance, was f u rn is h e d , or intended to be furnished, in exchange for controlled substances; represents p ro c e e d s of trafficking in controlled substances; or was used or intended to be used to f a c ilita te violations of 21 U.S.C. § 801 et seq. Id. at 2. The sole claimant before this C o u rt is Vaughn. This cause is before the Court on the Government's Motion for S u m m a ry Judgment. (Doc. # 47). Vaughn opposes the Government's motion. After c a re f u l consideration of the arguments of counsel, the relevant case law, and the record as a whole, the Court finds that the Government's Motion for Summary Judgment, (Doc. # 1
47), is due to be GRANTED. J U R I S D I C T IO N AND VENUE T h is Court has subject matter jurisdiction over the case pursuant to 28 U.S.C. §§ 1 3 4 5 and 1355, and 21 U.S.C. §§ 881. Venue is proper in this district pursuant to 28 U .S .C . §§ 1355 and 1395, and 21 U.S.C. § 881(j). F A C T S AND PROCEDURAL HISTORY O n December 17, 2008, the Government commenced this in rem action pursuant to 2 1 U.S.C. § 881(a)(6), seeking the forfeiture of the defendant money on the grounds that it was furnished, or intended to be furnished, in exchange for controlled substances; re p re se n ts proceeds of trafficking in controlled substances; or was used or intended to be u s e d to facilitate violations of 21 U.S.C. § 801 et seq. The salient facts are not in dispute a n d establish the following:1 O n August 6, 2008, Montgomery police officers met with a confidential source (th e "CS") to set up a controlled purchase of 5.5 grams of powder cocaine from a subject, la te r identified as Timothy Whiting ("Whiting").2 The CS contacted Whiting and
This recitation of facts is based upon the Verified Complaint (Doc. # 1), the Claim (D o c . #12), and the evidence submitted by the parties in support of and opposition to the m o tio n for summary judgment. The parties also describe facts relating to a June 4, 2008 drug transaction. The G o v e rn m e n t alleges that Vaughn participated in this drug buy, which Vaughn denies. The p a rtie s also appear to disagree over whether one or two confidential sources were involved in these two transactions. However, the underlying illegal activity for this forfeiture p ro c e e d in g is the August 6, 2008 drug transaction. The facts of the June 4, 2008 drug buy are unnecessary for the disposition of these summary judgment motions. As such, any 2
arranged for a purchase of cocaine. After photographing the $300.00 drug-buy money, c o n s is tin g of fifteen twenty-dollar bills, the police officers gave it to the CS. The CS c a lle d Whiting and arranged the drug buy. Whiting drove a car to the designated location. Vaughn rode along in the passenger seat. The CS got in the vehicle and sat in the back s e a t. Whiting gave 5.5 grams of powder cocaine to the CS, who gave Whiting the $ 3 0 0 .0 0 drug-buy money. The CS got out of the car, and Whiting drove off, still in the c o m p a n y of Vaughn. The CS gave the substance to Montgomery police officers. A p re s u m p tiv e test of the substance gave a positive result for cocaine. A short while after Whiting's vehicle drove away, a marked patrol unit was in s tru c te d to conduct a traffic stop of the vehicle. The vehicle was stopped, and Whiting a n d Vaughn were taken into custody. A search incident to arrest revealed $80.00 of the d ru g -b u y money in Whiting's possession. Vaughn's front pocket contained $6,207.00 in a s s o rte d U.S. currency, of which $220.00 was the remaining drug-buy money. A trained d ru g -d e te c tio n dog alerted upon the currency, indicating that the dog detected the e x p o s u re of the currency to illegal drugs or materials used in illegal drug manufacture or p re p a ra tio n . Vaughn was indicted by the Montgomery County District Attorney's Office for d is trib u tio n of a controlled substance and drug trafficking in relation to a prior drug tra n s a c tio n on June 4, 2008, as well as the August 8, 2008 drug transaction. After a
d is p u te as to the facts of the June 4, 2008 drug transaction is immaterial. 3
federal grand jury indicted Vaughn and another with conspiracy to distribute 50 grams or m o re of "crack" cocaine and distribution of 50 grams or more of "crack" cocaine in re la tio n to the June 4, 2008 drug transaction, the Montgomery County charges stemming f ro m both transactions were dismissed. After a jury trial, Vaughn was acquitted of the f e d e ra l charge on December 16, 2009. S U M M A R Y JUDGMENT STANDARD U n d e r Federal Rule of Civil Procedure 56(c), summary judgment is appropriate "if th e pleadings, depositions, answers to interrogatories, and admissions on file, together w ith the affidavits, if any, show that there is no genuine issue as to any material fact and th a t the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. C a tr e tt, 477 U.S. 317, 322 (1986). The party asking for summary judgment "always b e a rs the initial responsibility of informing the district court of the basis for its motion, a n d identifying those portions of `the pleadings, depositions, answers to interrogatories, a n d admissions on file, together with the affidavits, if any,' which it believes demonstrate th e absence of a genuine issue of material fact." Id. at 323. The movant can meet this b u rd e n by presenting evidence showing there is no dispute of material fact, or by showing th e non-moving party has failed to present evidence in support of some element of its case o n which it bears the ultimate burden of proof. Id. at 32223. O n c e the moving party has met its burden, Rule 56(e) "requires the nonmoving p a rty to go beyond the pleadings and by [his] own affidavits, or by the `depositions,
answers to interrogatories, and admissions on file,' designate `specific facts showing that th e re is a genuine issue for trial.'" Id. at 324. To avoid summary judgment, the n o n m o v in g party "must do more than simply show that there is some metaphysical doubt a s to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 5 7 4 , 586 (1986) (emphasis added). A plaintiff must present evidence demonstrating that h e can establish the basic elements of his claim. Celotex, 477 U.S. at 322. A court ruling o n a motion for summary judgment must believe the evidence of the non-movant and m u s t draw all justifiable inferences from the evidence in the non-moving party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). After the nonmoving party h a s responded to the motion for summary judgment, the court must grant summary ju d g m e n t if there is no genuine issue of material fact and the moving party is entitled to ju d g m e n t as a matter of law. See Fed. R. Civ. P. 56(c). D IS C U SS IO N T h e Government brings this action pursuant to 21 U.S.C. § 881(a)(6), which states in pertinent part that "[a]ll moneys . . . furnished or intended to be furnished by any p e rs o n in exchange for a controlled substance . . ., all proceeds traceable to such an e x c h a n g e , and all moneys . . . used or intended to be used to facilitate any violation of [ th e drug laws]" are subject to forfeiture. 21 U.S.C. § 881(a)(6). By its motion, the Government seeks a grant of summary judgment ordering the f o rf e itu re of the defendant money to the United States. (Doc. # 47). The Government
argues that all of the money is forfeitable as illegitimate drug money . (Doc. # 48, at 1 0 1 5 ).3 In the alternative, the Government contends that the $220.00 drug-buy money f o u n d in Vaughn's possession represents money furnished or intended to be furnished in e x c h a n g e for drugs, proceeds from such an exchange, or money used or intended to be u s e d to facilitate a drug violation. Id. at 15. Because this drug-buy money was part of the $ 6 ,2 0 7 .0 0 found in Vaughn's front pocket, the Government reasons that all of the d e f e n d a n t money, including any from legitimate sources, is forfeitable under the theory of c o m m in g lin g . Id. at 1516. In response, Vaughn argues that the Government has failed to prove that the d e f e n d a n t money was illegitimate drug money. (Doc. # 53).4 Vaughn further contends th a t nothing connects him to the August 6, 2008 drug transaction and, therefore, his m o n e y cannot be forfeited:
The Government points to numerous factors to support this proposition, including (1 ) the amount of cash found on Vaughn's person; (2) the lack of evidence as to a legitimate s o u rc e for such cash; (3) the alert by the drug-detection dog; and (4) Vaughn's prior c o n v ic tio n s for marijuana possession, robbery, and being a felon in possession of a firearm. (Doc. #48, at 1015). Specifically, Vaughn first argues that the amount of cash found on him is relatively s m a ll in relation to prior cases, see e.g., United States v. $121,100.00 in United States C u r r e n c y , 999 F.2d 1503, 1506 (11th Cir. 1993), and therefore fails to raise a presumption th a t it is connected to drug activity. (Doc. # 53, at 910). Second, he claims no duty on his p a rt to reveal a legitimate source of funds and that his failure to do so is not probative of drug a c tiv ity. Id. at 1011. Third, Vaughn contends that the drug dog's alert has, at most, m in im a l probative value. Id. at 12 (citing United States v. $53,082.00 in United States C u r r e n c y , 985 F.2d 245, 250 n.5 (6th Cir. 1993)). Finally, he points out that his convictions d o not evidence an "extensive drug related criminal history" and that he has no convictions f o r drug trafficking or distribution. Id. at 1213. 6
There is no evidence Vaughn initiated the transaction, procured the tra n s a c tio n , conceived the transaction or otherwise caused it to come about. There is no evidence of an offer to Vaughn by anyone to give him drugs in e x c h a n g e for the defendant currency. Nor does Vaughn offer to anyone his c a s h for drugs. Therefore, the United States cannot establish [a prima facie c a s e for forfeiture]. . . . There is no evidence establishing that anyone, a n yw h e re , at anytime, acquired drugs from Vaughn in exchange for the d e f e n d a n t currency. . . . Vaughn did not violate any subchapter of § 801. Id. at 8. In relation to the commingling theory of forfeitability, Vaughn admits that the $ 2 2 0 .0 0 drug-buy money was exchanged for drugs and subject to forfeiture. Id. at 11. H o w e v e r, he argues that the remaining defendant money is not forfeitable merely by to u c h in g and "com[ing] into contact with other property that is forfeitable." Id. at 12 (c itin g U.S. v. Pole No. 3172, Hopkinton, 852 F.2d 636, 63940 (1st Cir. 1988)).5 I . Legal Standard for Forfeitability In evaluating the evidence, this Court must maintain "`a common sense view to the re a litie s of normal life' applied to the `totality of the circumstances.'" United States v. C a r r e ll, 252 F.3d 1193, 1201 (11th Cir. 2001) (quoting United States v. Four Million, T w o Hundred Fifty-Five Thousand, 762 F.2d 895, 90304 (11th Cir. 1985)); see also U n ite d States v. $291,828.00 in United States Currency, 536 F.3d 1234, 1237 (11th Cir. 2 0 0 8 ).
Vaughn also argues that this Court lacks subject matter jurisdiction over the d e f e n d a n t money because the Circuit Court of Montgomery County, Alabama already had in rem jurisdiction over it. (Doc. # 48, at 67). This Court has already carefully considered th is argument and rejected it because of the "adoptive forfeiture" doctrine. (Doc. # 22, at 1 2 ). 7
A. The Government's Burden U n d e r the Civil Asset Forfeiture Reform Act of 2000 ("CAFRA"),6 the G o v e rn m e n t bears the burden of proving, "by a preponderance of the evidence, that the p ro p e rty is subject to forfeiture."7 18 U.S.C. § 983(c)(1). Where the "theory of forfeiture is that the property was used to commit or facilitate the commission of a criminal offense, o r was involved in the commission of a criminal offense," the Government must establish " a substantial connection between the property and the offense." Id. § 983(c)(3).8 "[T]he G o v e rn m e n t may use evidence gathered after the filing of a complaint for forfeiture to e s ta b lis h . . . that property is subject to forfeiture," id. § 983(c)(2), as well as c irc u m s ta n tia l evidence. United States v. Seventy-Four Thousand Seven Hundred Dollars
On April 25, 2000, Congress passed CAFRA, Pub. L. No. 106-185, 114 Stat. 202, to address concerns associated with federal civil forfeitures. Since the Government c o m m e n c e d this action after August 23, 2000, the date on which CAFRA became effective, C A F R A applies to this case. "The burden of showing something by a preponderance of the evidence, the most c o m m o n standard in the civil law, simply requires the trier of fact to believe that the e x is te n c e of a fact is more probable than its nonexistence before he may find in favor of the p a rty who has the burden to persuade the judge of the fact's existence." Concrete Pipe & P ro d s. of Cal., Inc. v. Constr. Laborers Pension Trust for S. Cal., 508 U.S. 602, 622 (1993); s e e also United States v. Eighty Thousand Six Hundred Thirty-Three Dollars ($ 80,633.00), N o . 2:05-cv-1086-WKW, 2008 U.S. Dist. LEXIS 32745, at *56 n.2 (M.D. Ala. Apr. 21, 2 0 0 8 ), aff'd, 2009 U.S. App. LEXIS 18016 (11th Cir. 2009). The Government argues that the "substantial connection" requirement of § 983(c)(3) is inapplicable where the Government advances the drug-proceeds theory of § 881(a)(6). (Doc. # 48, at 16). This Court finds nothing to support this position in the Eleventh Circuit. See Eighty Thousand Six Hundred Thirty-Three Dollars, 2008 U.S. Dist. LEXIS 32745, at * 6 n.3. 8
($74,700) in United States Currency, No. 2:06-cv-0736-WKW, 2008 U.S. Dist. LEXIS 3 2 1 7 0 , at *6 (M.D. Ala. Apr. 18, 2008). H o w e v e r, the Government "is not required to `connect the defendant currency to a n y particular drug transaction,' or proffer evidence that `points to drugs to the exclusion o f all other theories.'" United States v. Eighty Thousand Six Hundred Thirty-Three D o lla r s ($ 80,633.00), No. 2:05-cv-1086-WKW, 2008 U.S. Dist. LEXIS 32745, at *56 n .2 (M.D. Ala. Apr. 21, 2008) (quoting $121,100.00, 999 F.2d at 1508), aff'd, 2009 U.S. A p p . LEXIS 18016 (11th Cir. 2009). Indeed, the property need not belong to a drug d e a le r when seized. See Four Million, Two Hundred Fifty-Five Thousand, 762 F.2d at 9 0 5 ("[Section 881(a)(6)] does not limit forfeiture to property found in the hands of a d ru g dealer."); see also Carrell, 252 F.3d at 1200 ("We have recognized that `Congress c le a rly contemplated the forfeiture of property that once belonged to drug dealers, but s u b s e q u e n tly was transferred, via `legitimate transactions,' to third parties.'") (quoting F o u r Million, Two Hundred Fifty-Five Thousand, 762 F.2d at 905). B . The Claimant's Burden O n c e the Government has shown that the property is subject to forfeiture, "the b u rd e n of proof shifts to the claimant to show, by a preponderance of the evidence, that th e property is not subject to forfeiture." United States v. Cleckler, 270 F.3d 1331, 1334 (1 1 th Cir. 2001). "The claimant may meet this burden either by rebutting the g o v e rn m e n t's evidence or by showing that the claimant is an innocent owner." Id.
CAFRA provides for an innocent owner exception to civil forfeiture proceedings, in c lu d in g those brought pursuant to 28 U.S.C. § 881. 18 U.S.C. § 983(d)(1).9 The burden o f proof rests upon the claimant to establish, by a preponderance of the evidence, that he is an innocent owner. Id. To qualify as an innocent owner, a claimant must be one who "(i) did not know of th e conduct giving rise to forfeiture; or (ii) upon learning of the conduct giving rise to the f o rf e itu re , did all that reasonably could be expected under the circumstances to terminate s u c h use of the property." Id. § 983(d)(2)(A). However, "[i]f a post-illegal act transferee k n o w s of illegal activity which would subject property to forfeiture at the time he takes h is interest, he cannot assert the innocent owner defense to forfeiture." Carrell, 252 F.3d a t 120304 (quoting United States v. 6640 SW 48th St., Miami, Dade County, Fla., 41 F .3 d 1448, 1452 (11th Cir. 1995)).10 C . Commingling If the Government establishes that property is subject to forfeiture, then "legitimate f u n d s are forfeitable when knowingly commingled with forfeitable funds." United States
Specifically, CAFRA states that "[a]n innocent owner's interest in property shall not b e forfeited under any civil forfeiture statute. The claimant shall have the burden of proving th a t the claimant is an innocent owner by a preponderance of the evidence." 18 U.S.C. § 9 8 3 (d )(1 ). This rule can be explained as follows. A claimant with actual knowledge cannot f a ll under the lack of knowledge theory of 18 U.S.C. § 983(d)(2)(A)(i). Additionally, if the c la im a n t has actual knowledge of the illegal activity at or before taking an interest in the p ro p e rty, then a reasonable step in "terminat[ing] such use of the property" under 18 U.S.C. § 983(d)(2)(A)(ii) would simply be to take no interest in the property at all. 10
v. Thirty-Three Thousand Eight Hundred Thirty-Six Dollars ($33,836.00) in United States C u r r e n c y , 899 F. Supp. 574, 579 (M.D. Ala. 1995) (quoting United States v. One Single F a m ily Residence, 933 F.2d 976, 981 (11th Cir. 1991)); see also United States v. $ 5 2 ,0 0 0 .0 0 , More or Less, in United States Currency, 508 F. Supp. 2d 1036, 1044 (S.D. A la . 2007) ("Once legitimate funds are commingled with those subject to forfeiture, all of th e funds become subject to forfeiture."). "[W]hen a claimant to a forfeiture action has a c tu a l knowledge, at any time prior to the initiation of the forfeiture proceeding, that c la im a n t's legitimate funds are commingled with drug proceeds, traceable in accord with th e forfeiture statute, the legitimate funds are subject to forfeiture." Carrell, 252 F.3d at 1 2 0 4 n.12; see also Four Million, Two Hundred Fifty-Five Thousand, 762 F.2d at 905 (" C o n g re s s clearly contemplated the forfeiture of property that once belonged to drug d e a le rs, but subsequently was transferred, via `legitimate transactions,' to third parties. . . . [T]hose who knowingly do business with drug dealers do so at their own risk."). A claimant possessing actual knowledge of the commingling of legitimate and d ru g funds may still claim the innocent owner defense if "the claimant can prove that e v e ryth in g reasonably possible was done to withdraw the commingled funds or to dispose o f the property. Carrell, 252 F.3d at 1204 n.12; see also United States v. One 1988 C h e c o Let 410 Turbo Prop Aircraft, 282 F. Supp. 2d 1379, 1382 (S.D. Fla. 2003) (" [ W ]h e re an owner was aware of an illegal use of his property, he could still invoke the `in n o c e n t owner' defense if he could show that he took `all reasonable steps' to prevent
the illegal activity."). In other words, a claimant with actual knowledge of the illegal use c a n n o t claim innocent ownership under the lack of knowledge theory of 18 U.S.C. § 9 8 3 (d )(2 )(A )(i); he must claim innocent ownership based upon the reasonable steps th e o ry of § 983(d)(2)(A)(ii). Recall, however, that a claimant with knowledge of the ille g a l activity at the time he takes his interest in the defendant property cannot claim the in n o c e n t owner defense. See Carrell, 252 F.3d at 120304. Thus, if a claimant has actual k n o w le d g e of the drug proceeds at the time he takes his interest in them, then the innocent o w n e r defense is unavailable and all property that the claimant commingles with the drug p ro c e e d s is forfeitable. II. Analysis A . Forfeitability of the $220.00 Drug-Buy Money V a u g h n concedes "that the $220 of marked buy money found in Vaughn's pocket w a s exchanged for drugs, and is therefore subject to forfeiture" under 21 U.S.C. § 8 8 1 (a )(6 ). (Doc. # 53, at 11). Thus, there is no genuine issue of material fact and the G o v e rn m e n t is entitled to judgment as a matter of law on the forfeitability of the $220.00 d ru g -b u y money. B. Forfeitability of the Entire $6,207.00 T h e Government argues that the remaining defendant money is forfeitable under th e commingling theory. (Doc. # 48, at 1516). Under this theory, "when a claimant to a f o rf e itu re action has actual knowledge, at any time prior to the initiation of the forfeiture
proceeding, that claimant's legitimate funds are commingled with drug proceeds, tra c e a b le in accord with the forfeiture statute, the legitimate funds are subject to f o rf e itu re ." Carrell, 252 F.3d at 1204 n.12. i. Vaughn's Actual Knowledge In regards to whether Vaughn knew of the August 6, 2008 drug transaction, this C o u rt finds that Vaughn's presence in the enclosed vehicle in which the drug transaction to o k place, during the drug transaction, provides compelling circumstantial evidence that h e had actual knowledge of the drug buy. Vaughn has admitted to the following facts. He arrived with Whiting to the location of the drug buy in the passenger seat of the v e h ic le in which the drug transaction took place. Whiting remained in the driver's seat. The CS entered the enclosed vehicle and sat in the back seat. Whiting gave the cocaine to th e CS, who in turn gave Whiting the $300.00 drug-buy money. The CS then exited the v e h ic le , and Whiting drove off with Vaughn still in the passenger seat. In sum, Vaughn admits to arriving with Whiting, the drug dealer, and to remaining in the passenger seat of the enclosed vehicle while the drug transaction occurred. Vaughn a ls o admits that the drug dealer sat in the driver's seat and that the buyer sat in the back s e a t. Thus, the drug transaction must have occurred between the front and back seat, d ire c tly in front of Vaughn. This Court finds that, even taking all reasonable inferences in Vaughn's favor, the Government has presented sufficient circumstantial evidence to p ro v e that, by a preponderance of the evidence, Vaughn had actual knowledge of the
illegal activity at the time it occurred. Based upon these undisputed facts, this Court re f u s e s to allow one who remains in an enclosed vehicle, while a drug buy occurs directly in front of him, to turn a blind eye and claim lack of knowledge when he is found with the d ru g -b u y money shortly thereafter. Cf. One 1988 Checo Let 410 Turbo Prop Aircraft, 2 8 2 F. Supp. 2d at 1383 ("`[A]ctual knowledge' may be proven by inference from c irc u m s ta n tia l evidence suggesting a high probability of a property's involvement with d ru g trafficking, and . . . a property owner may not `turn a blind eye' toward such e v id e n c e and still claim `innocent owner' status under CAFRA."). V a u g h n has failed in his burden to "go beyond the pleadings" and "designate `s p e c if ic facts showing that there is a genuine issue for trial.'" Celotex, 477 U.S. at 324. He has not supplemented the record with his "own affidavits, or [with] the `depositions, a n s w e rs to interrogatories, and admissions on file.'" Id. Vaughn has failed to even allege a lack of knowledge as to the August 6, 2008 drug transaction. He merely contends that h e personally had no involvement in that drug buy;1 1 however, Vaughn misunderstands th e distinctions between criminal and civil forfeiture law. As the Eleventh Circuit e x p la in e d : C rim in a l forfeiture and civil forfeiture are distinct doctrines. Criminal
"There is no evidence that Vaughn initiated the [August 6, 2008] transaction, p ro c u re d the transaction, conceived the transaction or otherwise caused it to come about. There is no evidence of an offer to Vaughn by anyone to give him drugs in exchange for the d e f e n d a n t currency. Nor does Vaughn offer to anyone his cash for drugs. Therefore, the U n ite d States cannot establish [a prima facie case for forfeiture]." (Doc. #53, at 8). 14
forfeiture occurs in criminal court and comes into play only after the court h a s found the defendant guilty, though seizure does occur beforehand under th e federal system. In contrast, civil forfeiture is an in rem action, unrelated to the guilt or innocence of the property owners. Criminal forfeiture is u n d e rs to o d to be punitive insofar as it is intricately tied to the defendant's c rim in a l proceeding, whereas civil forfeiture is understood to be remedial in s o f a r as it "punishes" only the res itself. United States v. 1461 W. 42nd St., 251 F.3d 1329, 1333 (11th Cir. 2001) (emphasis a d d e d ). Thus, it is not Vaughn's culpability in the underlying criminal conduct that s u b je c ts the property to forfeiture. Vaughn is not the defendant in this forfeiture p ro c e e d in g ; the money is the defendant. It is Vaughn's actual knowledge of the u n d e rlyin g illegal activity, namely the August 6, 2008 drug transaction, that subjects the re m a in in g defendant money to forfeiture, not his participation, or lack thereof, in that d ru g buy. Based on the foregoing undisputed facts and taking all reasonable inferences in V a u g h n 's favor, this Court finds that there is no genuine dispute as to material fact and th a t the Government has proven, by a preponderance of the evidence, that Vaughn had a c tu a l knowledge of the August 6, 2008 drug transaction at the time it occurred. Indeed, o n the record before the court, no reasonable fact finder could conclude otherwise. ii. Prior to Initiation of Forfeiture Proceedings For the commingling doctrine to apply, a claimant must have actual knowledge p rio r to initiation of the forfeiture proceeding. Carrell, 252 F.3d at 1204 n.12. It is u n d is p u te d that the illegal activity underlying this forfeiture proceeding is the August 6, 2 0 0 8 drug transaction. This Court finds that the Government has proven, by a
preponderance of the evidence, that Vaughn had actual knowledge of this illegal activity a t the time it occurred. Thus, any allegedly legitimate funds that Vaughn commingled w ith the drug-buy money prior to initiation of the forfeiture proceeding on December 17, 2 0 0 8 are subject to forfeiture. Because the remaining defendant money was seized from V a u g h n 's person on August 6, 2008, shortly after the relevant drug transaction which to o k place in his presence and over four months prior to initiation of the forfeiture p ro c e e d in g , it is subject to forfeiture if it was commingled with the drug-buy money. iii. Commingling In order to be subject to forfeiture, legitimate funds must actually be commingled w ith illegitimate funds. Id. Vaughn contends that "the fact that the buy money touched th e defendant currency in [his] pocket does not establish that the defendant currency was e x c h a n g e d for drugs, or that it is proceeds traceable to a drug exchange, or that it f a c ilita te d a violation of the controlled substance laws of the United States." (Doc. #53, a t 11). He further argues that money is forfeitable only when "exchanged for drugs, or is p ro c e e d s of drug dealing, or that it is intended to be used in drug trafficking, not merely th a t it comes into contact with other property that is forfeitable." Id. at 1112. To s u p p o rt this proposition, Vaughn cites to First Circuit law. Id. at 12 (citing Pole No. 3 1 7 2 , 852 F.2d at 63940).1 2
The First Circuit "do[es] not believe that forfeitability spreads like a disease from o n e infected [piece of property] to the entire . . . property. . . . After all, only the actual p ro c e e d s of drug transactions are forfeitable." Pole No. 3172, 852 F.2d at 63940. 16
Whatever views the First Circuit may hold, the Eleventh Circuit has explicitly a c k n o w le d g e d the forfeitability of legitimate funds when knowingly commingled with ille g a l drug proceeds. Carrell, 252 F.3d at 1204 n.12; see also $52,000, More or Less, 5 0 8 F. Supp. 2d at 1044 ("Once legitimate funds are commingled with those subject to f o rf e itu re , all of the funds become subject to forfeiture.") (citing United States v. 15603 8 5 th Ave. N., 933 F.2d 976, 982 (11th Cir. 1991)). As such, it is irrelevant whether the G o v e rn m e n t establishes that the remaining defendant money represents drug money. Even legitimate money--that which is not "exchanged for drugs, or that . . . is [not] p ro c e e d s traceable to a drug exchange, or that . . . [did not] facilitate a violation of the c o n tro lle d substance laws," (Doc. #53, at 11)--is subject to forfeiture if knowingly c o m m in g le d with illegitimate funds. Here, both $220.00 of the illegitimate drug-buy money and the remaining d e f e n d a n t money were found together in Vaughn's front pocket. Thus, all of the d e f e n d a n t money is subject to forfeiture under the commingling doctrine. Cf. $52,000.00, More or Less, 508 F. Supp. 2d at 1038, 1045 (granting summary judgment f o r the United States and finding that allegedly legitimate money was forfeitable under th e commingling doctrine when found on the claimant's person in sealed envelopes along w ith illegitimate funds). Additionally, Vaughn concedes that the allegedly legitimate m o n e y and the illegitimate money were, in fact, commingled. (Doc. #53, at 3) ("A search in c id e n t to arrest revealed . . . $220.00 of the buy money in the possession of [Vaughn]
co-mingled [sic] with $6,207.00 of United States currency.") (emphasis added); see also id . at 11 ("The fact that $220 of buy money was comingled [sic] in Vaughn's pocket with th e defendant currency, does not establish that the government has met its burden by a p re p o n d e ra n c e of the evidence that the defendant currency is subject to forfeit.") (e m p h a s is added). Thus, this Court finds that there is no genuine issue of material fact a n d that the Government has established, as a matter of law, that the $220.00 drug-buy m o n e y was commingled with the remaining defendant money. In sum, the undisputed facts, taking all reasonable inferences in Vaughn's favor, e s ta b lis h the following: (1) Vaughn had actual knowledge of the illegal activity at the tim e it occurred on August 6, 2008; (2) his allegedly legitimate funds were commingled in his front pocket with the illegitimate $220.00 drug-buy money on August 6, 2008; and (3 ) this commingling occurred prior to initiation of this forfeiture proceeding on D e c e m b e r 17, 2008. Thus, Vaughn had actual knowledge that his allegedly legitimate f u n d s were commingled with illegitimate funds prior to initiation of the forfeiture p ro c e e d in g ; therefore, as a matter of law, all of the defendant money is subject to f o rf e itu re . C. Innocent Owner Defense Unavailable In the Eleventh Circuit, even claimants with actual knowledge of the commingling o f legitimate funds and drug proceeds can still claim the innocent owner defense if "the c la im a n t can prove that everything reasonably possible was done to withdraw the
commingled funds or to dispose of the property." Carrell, 252 F.3d at 1204 n.12. However, "[i]f a post-illegal act transferee knows of illegal activity which would subject p ro p e rty to forfeiture at the time he takes his interest, he cannot assert the innocent owner d e f e n s e to forfeiture." Id. at 120304 (emphasis added). The undisputed facts d e m o n s tra te that the CS gave the drug-buy money to Whiting during the drug transaction. Thus, Vaughn must have obtained his interest in the $220.00 drug-buy money after the d ru g transaction. Because the Government has established that Vaughn had actual k n o w le d g e of the drug transaction at the time it occurred, Vaughn knew of this illegal a c tiv ity when he later took his interest in the $220.00 drug-buy money. Therefore, the in n o c e n t owner defense is unavailable to Vaughn. CONCLUSION It is understood that one who engages in criminal conduct runs the risk of in c a rc e ra tio n and the forfeiture of his property; this case, however, provides a crucial w a rn in g for those who knowingly associate with criminals. Once cannot receive money f ro m drug dealers, with a wink and a nod, and then be immune to the consequences. As th e Eleventh Circuit has so assertively stated, "those who knowingly do business with d ru g dealers do so at their own risk." Four Million, Two Hundred Fifty-Five Thousand, 7 6 2 F.2d at 905. For the foregoing reasons, it is hereby ORDERED that the G o v e rn m e n t's Motion for Summary Judgment (Doc. # 47) is GRANTED. It is ORDERED that the Government shall file a proposed Decree of Forfeiture on
or before October 1, 2010. It is further ORDERED that the pretrial conference scheduled for September 29, 2 0 1 0 is CANCELLED. The Clerk of the Court is DIRECTED to remove the above-styled case from the tria l docket. The Court will enter a separate final judgment consistent with this Memorandum O p in io n and Order. DONE this 24th day of September, 2010. /s/ Mark E. Fuller CHIEF UNITED STATES DISTRICT JUDGE
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