United States of America v. Kumar's Personal Property

Filing 25

ORDER LIFTING STAY - Signed by District Judge Louise Wood Flanagan on 10/14/2020. (Tripp, S.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
EASTERN DIVISION
NO. 4:17-CR-5-FL-1
UNITED STATES OF AMERICA

)
)
)
)
)
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v.
SANJAY KUMAR,
Defendant.

ORDER

This matter is before the court on the government’s motion (DE 568) for confiscation,
forfeiture, and disposal of seized firearms and ammunition pursuant to 18 U.S.C. § 3665. The
motion has been briefed fully, and in this posture the issues raised are ripe for ruling. For the
following reasons, the motion is denied.
BACKGROUND
Indictment was returned in this case on January 12, 2017. On February 22, 2018, defendant
was named in a 45 count, second-superseding indictment (“indictment”) charging him with the
following:
1. conspiracy

to

unlawfully

dispense

and

distribute

oxycodone,

oxymorphone,

hydromorphone, and alprazolam in violation of 21 U.S.C. § 846 (count one);
2. possession of a firearm in furtherance of a drug trafficking crime in violation of 18 U.S.C.
§ 924(c)(1)(A) (count two);
3. unlawful dispensation and distribution of oxycodone in violation of 21 U.S.C. § 841(a)(1)
(counts three through 23);

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4. possession of a firearm in furtherance of a drug trafficking crime in violation of 18 U.S.C.
924(c)(1)(A)(i) (count 24);
5. unlawful dispensation and distribution of alprazolam in violation of 21 U.S.C. § 841(a)(1)
(counts 25 through 30);
6. engaging in monetary transactions in property derived from specified unlawful activity in
violation of 18 U.S.C. § 1957 (counts 31 through 32);
7. laundering of monetary instruments in violation of 18 U.S.C.§ 1956(a)(1)(B)(i), (ii) (counts
33 through 42); and
8. attempt to evade and defeat tax in violation of 26 U.S.C. § 7201 (counts 43 through 45).
(DE 16, DE 86).
The indictment also contains a notice that the government seeks forfeiture of certain
property of defendant, including but not limited to 36 firearms and more than 40,000 rounds of
ammunition, which firearms and ammunition are subject of the instant motion. In advance of trial,
the government requested that the court instruct the jury regarding the criminal forfeiture alleged
in the notice in the indictment, in conjunction with a proposed special verdict form, in the event
the defendant was convicted of the offenses listed in counts one or two of the indictment.
Trial concluding August 12, 2019, lasting some 26 days, including four days during which
the jury deliberated its verdict, resulted in the jury finding defendant guilty of five counts of
unlawful distribution of oxycodone in violation of 18 U.S.C. § 841(a)(1) (counts three, four, five,
nine, and 11), five counts of money laundering by concealment in violation of 18 U.S.C. §
1956(a)(1)(B)(i)-(ii) (counts 33, 34, 35, 39, and 40), and three counts of tax evasion in violation
of 26 U.S.C. § 7201 (counts 43, 44, and 45). Not guilty verdicts were returned on the 32 other
counts lodged against defendant, including, of particular note with respect to the instant motion,

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count one (the conspiracy count in violation of 21 U.S.C. § 846), and count two (the firearms count
in violation of 18 U.S.C. § 924(c)(1)(A)).
After polling the jury on the verdict, the court then asked counsel for defendant and the
government, at side bar, whether there was anything further to address regarding forfeiture.
Defendant took the position that there was no further issue regarding forfeiture. The government
concurred that there was nothing further regarding forfeiture.
That same date, defendant moved to dismiss the forfeiture notice in the indictment as well
as the “complaint in rem” in a separate forfeiture action, United States v. Kumar’s Personal
Property, No. 4:16-CV-281-FL (hereinafter the “civil forfeiture case”), in which the government
seeks civil forfeiture of the same items subject of the instant motion. (See DE 389).1 As pertinent
here, with respect to defendant’s firearms and ammunition, the court denied the motion “to the
extent that defendant seeks to recover defendant’s weapons and ammunition,” reasoning that
“[t]hese items are subject of a separate civil forfeiture action . . . and, therefore, properly should
remain subject to the jurisdiction of this court pursuant to warrant for arrest and notice in rem
issued by the clerk.” (October 1, 2019, order (DE 403) at 11).
After several extensions, the court set sentencing to commence September 4, 2020.2 Seven
days in advance of sentencing, the government filed the instant motion, accompanied by a

1

In the same motion, defendant also sought return of additional property and currency seized by the
government. Upon defendant’s oral renewed motion at sentencing, the court allowed defendant to reopen that portion
of the motion DE 389 pertaining to return of defendant’s property, as supplemented by defendant’s pro se handwritten
itemized list of property (the “reopened motion”). The reopened motion does not pertain to firearms and ammunition
which are subject of the instant order and the civil forfeiture case. The court referred the reopened motion, along
with two additional oral motions for accounting, to magistrate judge for ruling. Those motions will be addressed by
separate order.
2

Sentencing initially was scheduled to commence January 6, 2020, but then continued upon defendant’s
motion to a date to be determined. The court then set sentencing to take place March 6, 2020. On February 27, 2020,
again upon defendant’s motion, the court continued sentencing to a date to be determined. The court then set
sentencing to take place April 30, 2020. Then, on the court’s initiative, the court set sentencing for the September 8,
2020 term of court. On August 6, 2020, the court entered a scheduling order set sentencing to commence September

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proposed preliminary order of forfeiture. At the second day of sentencing, on September 8, 2020,
the court heard argument from both sides concerning the instant motion, and the court inquired of
the government whether there was any prejudice to the government if the court holds in abeyance
its decision on the instant motion, referencing a need to consider issues raised by civil forfeiture
case and the criminal case. Although the government responded that there potentially could be
prejudice to the government, and urged the court to decide the motion on the date of sentencing,
the court took the motion under advisement. At the conclusion of sentencing, the court forecasted
a need for further briefing on the motion, and, in order entered September 11, 2020, the court
directed defendant to file a response to the instant motion within ten days.
In the meantime, the court entered judgment sentencing defendant to a term of
imprisonment of 240 months, 3 year term of supervised release, special assessment of $1,300.00,
fine of $50,000.00, and restitution of $471,758.40 payable to the Internal Revenue Service during
the term of supervised release.
Defendant responded in opposition to the instant motion on September 21, 2020, attaching
a pro se statement of objection to confiscation of firearms. The government replied, with leave of
court, on September 22, 2020.
COURT’S DISCUSSION
Confiscation, forfeiture, and disposal of firearms pursuant to 18 U.S.C. § 3665 is not
authorized or proper under the circumstances of this case, for several independent reasons set forth
below.
A.

The Statute
The statute under which the government seeks relief, 18 U.S.C. § 3665, provides:

4, 2020, providing an August 28, 2020, deadline for filing sentencing memoranda and other materials pertaining to
sentencing.

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A judgment of conviction for transporting a stolen motor vehicle in interstate or
foreign commerce or for committing or attempting to commit a felony in violation
of any law of the United States involving the use of threats, force, or violence or
perpetrated in whole or in part by the use of firearms, may, in addition to the penalty
provided by law for such offense, order the confiscation and disposal of firearms
and ammunition found in the possession or under the immediate control of the
defendant at the time of his arrest.
The court may direct the delivery of such firearms or ammunition to the lawenforcement agency which apprehended such person, for its use or for any other
disposition in its discretion.
18 U.S.C. § 3665.
As pertinent here, by its plain language, the statute provides: 1) a “judgment of conviction,”
2) “for committing a felony,” 3) “perpetrated in whole or in part by the use of firearms,” 4) “may,”
5) “order the confiscation and disposal of firearms and ammunition.” Id. Under the circumstances
of this case, the government has not demonstrated that defendant committed a felony perpetrated
in whole or in part by the use of firearms. Defendant was convicted only of five counts of unlawful
dispensation and distribution of oxycodone in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(C),
as well as money laundering and attempt to evade or defeat tax. The judgment does not state
anything about these offenses being perpetrated in whole or in part by the use of firearms, and
none of these offenses has an element the use of a firearm. On this basis alone, § 3665 is
inapplicable.
The government suggests that the court can order forfeiture under § 3665 based upon
findings made by the court at sentencing that defendant possessed a firearm. The referenced
findings, however, were made in context of a sentencing guidelines enhancement for purposes of
determining the advisory guidelines range, under which the “enhancement should be applied if [a]
weapon was present, unless clearly improbable that the weapon was connected with the offense.”
(Mem. Op. (DE 590) at 13 (quoting U.S.S.G. § 2D1.1(b)(1) comment. (n. 11(A))). Section 3665
requires more than just a finding that a “weapon was present” so long as not “clearly improbable
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that the weapon was connected with the offense.” Id. Much differently, it requires a “conviction
. . . for committing a felony, . . . perpetrated in whole or in part by the use of firearms.” 18 U.S.C.
§ 3665. Accordingly, the court’s findings at sentencing do not meet this standard.
The government also suggests that the court may draw from caselaw interpreting a
“companion forfeiture authority,” 18 U.S.C. § 924(d), “which authorizes the forfeiture of firearms
‘used in or involved in’ a crime,” and which is “construed broadly” in the case law. (Reply (DE
603) at 3). This suggestion is flawed in multiple respects. As an initial matter, the government is
not seeking forfeiture, at this juncture, pursuant to 18 U.S.C. § 924(d). Indeed, as set forth in the
next section of this order, it has not followed any of the requisite procedural requirements for
forfeiture of the subject firearms and ammunition in this criminal case under 18 U.S.C. § 924(d).
Moreover, the text of § 924(d) is notably different from the text of § 3665, in that it allows, for
example, forfeiture in the event of firearms “involved in or used in any violation of” enumerated
federal law, 18 U.S.C. § 924(d)(2)(C) (emphasis added), and thus does not turn on a conviction.
See United States v. One Assortment of 89 Firearms, 465 U.S. 354, 362 (1984). Thus, the
government’s recourse to a different statute, § 924(d), to determine the requirements for
application of § 3665, misses the mark.
Notably, the government has not cited, and the court has not found, any opinion by the
United States Court of Appeals for the Fourth Circuit, nor any other court in this circuit, addressing
application of § 3665 to an order of confiscation, forfeiture, and disposal of firearms and
ammunition. Two out-of-circuit cases cited by the government are not helpful in interpreting the
requirements of the statute. In United States v. Konopski, 685 F. App'x 63, 66 (2d Cir. 2017), in
an unpublished non-precedential opinion, the United States Court of Appeals affirmed an order of

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forfeiture entered by the district court pursuant to both 18 U.S.C. §924(d) and § 3665.3 In United
States v. Benson, 184 F.3d 936, 937 (8th Cir. 1999), the district court originally ordered forfeiture
on the basis of a firearms conviction under 18 U.S.C. § 924(c), and the court of appeals affirmed
the denial of a motion by defendant to seek return of firearms under Rule 41(e) upon the later
vacation of that conviction, which is a procedural posture that does not provide basis for ready
comparison to the instant case.
B.

Procedures for Forfeiture
In addition, and in the alternative to the foregoing, the government has not followed the

requisite procedure for forfeiture of the subject firearms and ammunition within this criminal case.
Although the Fourth Circuit has not addressed the issue, the United States Court of Appeals
for the Fifth Circuit has held that § 3665 “can be invoked only if the indictment alleges the property
subject to forfeiture and a judgment of criminal forfeiture is entered.” United States v. Posey, 217
F.3d 282, 284 (5th Cir. 2000). A judgment of criminal forfeiture, in turn, must be preceded by
compliance with “the plethora of . . . statutory rules prescribing procedures that must be followed
should the government wish to seek a forfeiture.” Id. As a result, “the government’s concept of §
3665, either as vesting discretion in the district court irrespective of these other rules, or as
substituting some ad hoc notion of due process in their stead, is plainly wrong.” Id.; see United
States v. Candelaria-Silva, 166 F.3d 19, 43 (1st Cir. 1999) (“[T]he defendant has a right to have
the amount subject to forfeiture determined, in the first instance, by the jury.”); United States v.

3

Additional facts distinguish Konopski from the instant case, particularly the procedural posture of the
forfeiture, also as relevant to Section B. of the instant order. In particular, as revealed in the record of that case, upon
conclusion of trial, the defendant did not request that the jury be detained to determine forfeiture, and rather expressly
agreed that the court should decide the issue of forfeiture. See United States v. Konopski, No. 16-227 (2nd Cir.) (record
on appeal at 321-332, 348-350, 27-28). The government then filed its motion for forfeiture over two months prior to
sentencing, enabling the district court to hold a separate hearing on forfeiture over a month prior to sentencing. See
id. Moreover, in Konopski, the court ordered forfeiture of firearms from the defendant’s house, the location where the
defendant had distributed drugs, 685 F. Appx. at 67, in contrast to the instant case where defendant did not dispense
drugs out of his house.

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Seifuddin, 820 F.2d 1074, 1078 (9th Cir. 1987) (“Even if forfeiture is alleged in the indictment, a
judgment of criminal forfeiture also requires a special verdict and a judgment authorizing seizure
of the property subject to forfeiture.”) (emphasis added).
Notably, under Rule 32.2 a jury determination of criminal forfeiture is required under the
circumstances presented by this case:
In any case tried before a jury, if the indictment or information states that the
government is seeking forfeiture, the court must determine before the jury begins
deliberating whether either party requests that the jury be retained to determine the
forfeitability of specific property if it returns a guilty verdict.
Fed. R. Crim P. 32.2(b)(5)(A). In addition,
If a party timely requests to have the jury determine forfeiture, the government must
submit a proposed Special Verdict Form listing each property subject to forfeiture
and asking the jury to determine whether the government has established the
requisite nexus between the property and the offense committed by the defendant.
Fed. R. Crim. P. 32.2(b)(5)(B).
Notably, the government triggered these requirements in the rule by requesting in the first
instance to have the jury determine forfeiture of the subject firearms and ammunition in this case,
and the government submitted a proposed special verdict form. That verdict form became moot
upon defendant’s acquittal of counts one and two. At that point, though given an opportunity by
the court to pursue forfeiture further if warranted, the government did not do so. Accordingly, by
presenting a limited proposed special verdict form on forfeiture of the subject firearms and
ammunition, and by proposing no more for jury determination, the government abandoned
forfeiture as a component of the judgment in this case, in light of the requirements of Rule
32.2(b)(5). Thus, § 3665 is not a proper vehicle for bringing about forfeiture in this criminal case
where the government first has not followed all the procedural requirements for such forfeiture.
Moreover, the government’s attempt to resurrect forfeiture through the back door of § 3665
the week before sentencing is procedurally problematic in a number of respects. Rule 32.2 requires
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the court “[a]s soon as practical after a verdict or finding of guilty . . . on any count in an indictment
or information regarding which criminal forfeiture is sought, . . . [to] determine whether the
government has established the requisite nexus between the property and the offense.” Fed. R.
Crim. P. 32.2 (b)(1)(A). Here, the government only sought criminal forfeiture on the basis of
counts one and two in the indictment, as set forth in its proposed special verdict form and jury
instructions. The government did not seek forfeiture on any other counts at that time upon the
verdict rendered by the jury, to enable the court to fulfill its duty to make a forfeiture determination
“[a]s soon as practical after a verdict or finding of guilty.” Id.
Similarly, because the government waited until the week before sentencing to seek
forfeiture under § 3665, having given no notice to defendant or the court that it was going to do
so, the government made it virtually impossible to enter a “preliminary order sufficiently in
advance of sentencing to allow the parties to suggest revisions or modifications before the order
becomes final as to the defendant.” Fed. R. Crim. P. 32.2(b)(2)(B). It also made it practically very
difficult for the court to “include the forfeiture order, directly or by reference, in the judgment.”
Fed. R. Crim. P. 32.2(b)(4)(B).4
In sum, due to all these procedural deficiencies, entry of an order of forfeiture under § 3665
is not authorized or proper under the circumstances of this case.
C.

Court’s Discretion
Finally, also in the alternative to the foregoing, the court declines to exercise discretion to

award confiscation, forfeiture, and disposal, of the subject firearms and ammunition pursuant to §

4

While the timing of the motion is one of several procedural shortcomings noted here in the text, in light of
the court’s holding herein, the court does not reach defendant’s additional argument that the court lacks authority or
jurisdiction at this juncture to enter a criminal forfeiture order solely because it was not included in the judgment
entered on the date of sentencing. Rule 32.2(b)(4)(B) states that “the court’s failure to do so may be corrected at any
time under Rule 36,” and the Fourth Circuit has held that the failure to include a forfeiture order in the judgment,
standing alone, is not a jurisdictional defect. United States v. Martin, 662 F.3d 301, 307 (4th Cir. 2011).

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3665. Even where all the statutory requirements of § 3665 are met, the statute expressly states
that the court “may” order confiscation and disposal of firearms and ammunition, thus leaving any
such order in the sound discretion of the district court. 18 U.S.C. § 3665. Here, the court declines
to order confiscation, forfeiture, or disposal of the subject firearms and ammunition under § 3665
for all the reasons stated in sections A. and B. above, in addition to the fact that the civil forfeiture
case regarding the same firearms and ammunition remains pending, allowing for deliberate and
careful exercise of the procedural and substantive requirements for forfeiture. See United States v.
Wild, 47 F.3d 669, 674–75 (4th Cir. 1995). Given the choice between proceeding in this criminal
case on the basis of an untested theory of forfeiture, and addressing forfeiture under more
commonly applied rules of civil forfeiture, the court chooses in its discretion to decline to order
forfeiture in the instant criminal case.
CONCLUSION
Based on the foregoing, the government’s motion or confiscation, forfeiture, and disposal
of firearms and ammunition (DE 568) is DENIED. The clerk is DIRECTED to file a copy of this
order in the instant case and in the related civil forfeiture case (United States v. Kumar’s Personal
Property, No. 4:16-CV-281-FL), and thereupon to LIFT the stay imposed on February 13, 2017,
in that civil forfeiture case.
SO ORDERED, this the 14th day of October, 2020.
_____________________________
LOUISE W. FLANAGAN
United States District Judge

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