United States of America v. Miscellaneous Personal Property et al

Filing 35

ORDER granting 23 Motion to Strike 10 Claim and 9 Claim and granting 24 Motion for Summary Judgment. Signed by District Judge James C. Dever, III on 7/26/2019. Copies sent via US Mail to Kiet Tuan Vo at FCI Edgefield, P.O Box 725, Edgefield, SC 29824 and Phuong Truong 2625 Great Scott Drive, Myrtle Beach, SC 29579. (Stouch, L.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:16-CV-229-D
UNITED STATES OF AMERICA,

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Plaintiff,

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v.

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ORDER

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lMISCELLANEOUSPERSONAL
PROPERTY SEIZED FROM KIET
TUAN VO AND PHUONG TRUONG,

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Defendant. )
On May 5, 2016, the United States of America filed this civil action in rem seeking the

forfeiture of miscellaneous personal property and U.S. currency under 18 U.S.C. §§ 98l(a)(l)(A),
981(a)(l)(C), and 1955(d) [D.E. 1]. On July 26, 2016, Kiet Tuan Vo ("Kiet Vo") and his wife
Phuong Truong (''Truong''; collectively, "claimants") filed claims [D.E. 9, 10]. On September 15,
2016, claimants answered the complaint [D.E. 15]. On September 16, 2016, the court granted
claimants' motion to stay [D.E. 16]. On July 19, 2018, the court permitted claimants' counsel to
withdraw, lifted the stay, and opened discovery [D.E. 18-21].
On December 17, 2018, the United States moved to strike the claims ·and answer and for

summary judgment [D.E. 23, 24], and filed a memorandum in support [D.E. 25], a statement of
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material facts [D.E. 26], and an appendix [D.E. 27]. The court notified claimants about the motion
for summary judgment, the consequences offailing to respond, and the response deadline [D.E. 28].
See Roseboro v. Garriso~ 528 F.2d 309, 310 (4th Cir. 1975) (per curiam). On February 22, 2019,
Kiet Vo filed several exhibits [D.E. 31]. On March 8, 2019, the United States replied [D.E. 32]. On

March 25, 2019, Truong filed a declaration [D.E. 33]. On March 27, 2019, ~et Vo responded in
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opposition [D.E. 34]. As explained below, the court grants the United States' IJ10tions to strike and
for summary judgment, strikes the claims, and forfeits the property to the United States.
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I.

In 2013, federal and state authorities began investigating an illegal gambling operation in
Fayetteville and Cumberland County, North Carolina. See [D.E. 26] ~ 1; Moultis Deel. [D.E. 2] ~
8; Pl.'s App'x [D.E. 27-1] 1. During interviews with investigators, members of the operation
''provided information regarding [Kiet Tuan Vo]' s leadership itivolvement, supplying illegal
gambling machines, coordination of money pickups, and other cri~inal conduct." Moultis Deel. ~
9; see Pl.'s App'x [D.E. 27-1] 1. Investigators discovered that claunants ''niaintained over twenty
bank accounts" with ''multiple accounts for Limited Liability Cotj)orations that were set up for the
businesses." Moultis Deel. ~ 15; see Pl.' s App'x [D.E. 27-1] 5-6. "Analysis ofthe banking records
showed a pattern of deposits of large bulk currency into the accounts" that was "largely structured
to stay below reporting thresholds." Moultis Deel.~ 15; see Pl.'s App'x [D.E. 27-1] 5--6.
On December 3, 2015, investigators executed search warrants at five illegal gambling

locations and seized 67 video poker machines. See [D.E. 26] ~ 2; Moultis Deel. ~ 18. Investigators
also searched claimants' residence and discovered "[e]vidence of video poker machines around the
house," ledgers and tally sheets for gambling activities, fine jewelry and gold coins, and $46, 106.00
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in U.S. currency. Moultis Deel.~ 19; see [D.E. 26] ~ 4; Pl.'sApp'x [D.E. 27-1] 2-6. Investigators
also searched "Bank of America and Wells Fargo Bank for bank accounts and two safety deposit
boxes" and "seized $123,900.00 in bulk currency from a safety deposit box along with $101,517.00
in funds from accounts." Moultis Deel.~ 20; see [D.E. 26] ~ 5.

2

On May 5, 2016, the United States filed this civil forfeiture action. ·Publication has been

made, and no other claims have been filed. See [D.E. 26] ~ 6; Pl. 's App'x [D.E. 27-2]. On October
18; 2017, a federal grand jury in the Eastern District of North Carolina indicted claimants for
conspiracy to conduct an illegal gambling business in violation of 18 U.S.C. § 371 (count one) and
conducting an illegal gambling business and aiding and abetting in violation of 18 U.S.C. §§ 1955
and 2 (count two). See Indictment, United States v. Truong, No. 5:17-CR-321-FL, [D.E. 12]
(E.D.N.C. Oct. 18, 2017). The indictment contained a forfeiture notice relating to the currency at
issue in this forfeiture action. See id.
On January 16, 2018, Kiet Vo pleaded guilty to count one. See Vo PleaAgmt., United States

v. Truong, No. 5:17-CR-321-FL, [D.E.48] (E.D.N.C.Jan.16,2018). OnFebruary20,2018, Truong
pleaded guilty to count one. See Truong PleaAgmt., United States v. Truong, No. 5: 17-CR-321-FL,
[D.E. 60] (E.D.N.C. Feb. 20, 2018). Claimants agreed ''to voluntarily forfeit and relinquish to the
United States the property specified in the Criminal Indictment" and "all items seized during the
investigation of the acts alleged in the Criminal Indictment." Id., [D.E. 48] ~ 2(e); [D.E. 60] ~2(t).
On May 24 and November 8, 2018, the court entered preHminary orders of forfeiture against Vo and

Truong. See Orders, United States v. Truong, No. 5:17-CR-321-FL, [D.E. 84, 102] (E.D.N.C.).
The United States argues that claimants lack Article mstanding to assert claims concerning
the property. See [D.E. 25] 5-7. Under the Supplem~tal Rules for Admiralty or Maritime Claims
and Asset Forfeiture Actions of the Federal Rules of Civil Procedure, the United States may file a
motion to strike a claim or answer on the grounds that the claimant lacks standing atany time before
trial. See Fed. R. Civ. P. Supp. R. G(8)(c)(i)(B). A motion to strike ''may be presented as ... a
motion to determine ... by summary judgment whether claimant ~an carry the b~denofestablishing
standing by a preponderance of the evidence." Id.

3

Summary judgment is appropriate when, after reviewing the record as _a whole, the court
determines that no genuine issue ofmaterial fact exists and the moving party is entitled to judgment
asamatteroflaw. SeeFed.R. Civ.P. 56(a);Anderson v. Liberty Lobby.Inc., 477U.S. 242,247-48
(1986). The party seeking summary judgment must initially demonstrate the absence of a genuine
issue ofmaterial fact or the absence of evidence to support the nonmoving party's case. See Celotex
Corp. v.

Catr~

477 U.S. 317, 323 (1986). Once the moving party has met its burden, the

nonmoving party may not rest on the allegations or denials in its pleading, see Anderson, 477 U.S.·
at 248-49, but ''must come forward with specific facts showing that there is a genuine issue for
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trial." MatsushitaElec. Indus. Co. v. Zenith.Radio Corp., 475 U.S. 574, 587 (1986) (emphasis and
quotation omitted). A trial court reviewing a motion for summary judgment should determine
whether a genuine issue of material fact exists for trial. See Anderson, 477 U.S. at 249. In making
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this determination, the court must view the evidence and the inferences drawn therefrom in the light
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most favorable to the nonmoving party. See Scott v. Harris, 550 U.S. 372, 378 (2007). ·
A genuine issue ofmaterial fact exists ifthere is sufficient evidence favoring the nonmoving
party for a jury to return a verdict for that party. See Anderson, 477 U.S. at 249. "The mere
existence of a scintilla of evidence in support ofplaintiffs position [is] insufficient ...." Id. at 252.;
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see Beale v. Hardy, 769 F.2d 213, 214 (4th Cir. 1985). Only factual disputes that affect the outcome
under substantive law properly preclude summary judgment. See Anderson, 477 U.S. ~t 248.
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In a civil forfeiture case, a claimant must show "a colorable interest in the property [at issue]
to have standing." United States v. Phillips, 883 F.3d 399, 402 (4th Cir.), cert. deni~ 139 S. Ct.

347 (2018). Merely asserting "an ownership interest in the property'' does not siiffice. Id. at 403;
see United States v. $17.900.00 in U.S. Currency, 859 F.3d 1085,. 1089-90 (4th Cir. 2017). A
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claimant must prove both statutory standing and Article ID standing by a preponderance of the
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evidence. See $17.900.00 in U.S. Currency, 859 F.3d at 1089. "[S]tatutory standing relates to a
claimant's ability to show that he has satisfied whatever statutory requirements Congress has
imposed for contesting a civil forfeiture action in federal court." United States v. 8 Gilcrease Lane.
Quincy FL 32351, 641 F. Supp. 2d 1, 5-6 (D.D.C. 2009)(quotations omitted). "Article ill standing
... relates to the claimant's ability to show that he has a sufficient interest in th~ .property_ to satisfy
the case-or-controversy requirement of Article ill." Id. (quotations omitted); see United States v.
Real Prop. Located at 229 Potter Rd.. N. Kingstown. R.I., 91 F. Supp. 3d 303, 306 (D. Conn. 2015).
K.iet Vo and Truong lack Article ill standing because their plea agreements included a
provision forfeiting the property at issue in this action. See United Sfutes v. Tw~ty Miljam-350 IED
Jammers, 669 F.3d 78, 91 (2d Cir. 2011); United Suites v. Real Prop. Descrlbed in Deeds. 962 F.
Supp. 734, 737 (W.D.N.C. 1997) (collecting cases). Given K.iet Vo and Truo0g's plea agreements
and the preliminary orders of forfeiture, they cannot show a colorable interest in a.ri.y of the property
at issue by a preponderance of the evidence. Thus, K.iet Vo and Truong lack Article mstanding to
challenge the forfeitability of the property in this civil forfeiture action. Finally, the court rejects
K.iet Vo's arguments concerning the voluntariness of his guilty plea. See United States v. Vo, 763
F. App'x 339, 340-41 (4th Cir. 2019) (per curiam) (unpublished).
II.

In sum, the court GRANTS the government's motions to strike and f<;lr_ summary judgment

[D.E. 23, 24] and STRIKES the claims [D.E. 9, 10]. The property is forfeited to the government
The clerk shall close the case.
SO ORDERED. This i C. day of July 2019.

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