UNITED STATES OF AMERICA v. CURRENCY, $240,100.00 IN U.S.

Filing 31

MEMORANDUM OPINION AND ORDER signed by CHIEF JUDGE WILLIAM L. OSTEEN, JR on 05/25/2017, that the Government's Motion for Summary Judgment (Doc. 25 ) is hereby GRANTED. FURTHER ORDERED that the $240,100.00 in U.S. Currency shall be and is HEREBY FORFEITED to the United States pursuant to 21 U.S.C. § 881(a)(6). A judgment in accordance with this Memorandum Opinion and Order will be entered contemporaneously herewith. (Garland, Leah)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
UNITED STATES OF AMERICA,
Plaintiff,
v.
$240,100.00 in U.S. CURRENCY,
Defendant.

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1:14CV942

MEMORANDUM OPINION AND ORDER
OSTEEN, JR., District Judge
The United States of America (“Plaintiff” or the
“Government”) brought a civil forfeiture proceeding against
$240,100.00 in U.S. currency (the “Defendant Property”). (Doc.
1.) Claimant Shunika Hemingway Henderson (“Claimant”) filed a
Verified Notice of Claim and Answer. (Docs. 5, 6.) Presently
before the court is the Government’s Motion for Summary
Judgment. (Doc. 25.) Claimant has responded in opposition (Doc.
29), and the Government has replied (Doc. 30). For the reasons
that follow, the motion will be granted.
I.

FACTUAL ALLEGATIONS
The following facts are presented in the light most

favorable to Claimant:

The Durham Police Department (“DPD”) began making
controlled purchases of small quantities of crack cocaine from
Anthony Henderson (“Henderson”), Claimant’s husband, beginning
in 2011. (Pl.’s Br. in Supp. of Summ. J. (“Pl.’s Br.”), GE A,
Declaration of David M. Walker (“Walker Decl.”) (Doc. 26-2)
¶ 4.) In April 2014, a DPD officer used a confidential informant
to make two controlled purchases of $20 worth of crack cocaine
from Henderson at his body shop business in Durham. (Pl.’s Br.,
GE B, Declaration of Brian T. Black (“Black Decl.”) (Doc. 26-3)
¶ 3.) On May 1, 2014, DPD officers executed a search warrant for
the body shop. (Id. ¶ 4.) DPD officers searched Henderson and
found a set of keys in his pockets, which were used to unlock
the office in the business. (Id. ¶ 5.) DPD officers also found a
single key in Henderson’s pocket that fit the lock to a locked
drawer of a desk in the office. (Id. ¶ 7.) Inside the drawer was
a loaded 9mm Taurus handgun, various pill bottles, and two
plastic bags containing a substance that later tested positive
for crack cocaine. (Id. ¶ 5; Walker Decl. (Doc. 26-2) ¶ 14.) The
five employees present on the premises were also searched and
none of their keys were found to fit the drawer’s lock. (Black
Decl. (Doc. 26-3) ¶ 7.)
During the search of the body shop, DPD officers also
brought a certified narcotics detection canine to perform an
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exterior sniff of a Ford F-150 truck parked in the business
parking lot. (Pl.’s Br., GE C, Declaration of Kelly Stewart
(“Stewart Decl.”) (Doc. 26-4) ¶¶ 1, 4.) The truck had been seen
at Henderson’s residence earlier that day. (Black Decl. (Doc.
26-3) ¶ 4.) The canine positively alerted to the presence of an
illegal narcotic odor on the passenger side door of the truck.
(Stewart Decl. (Doc. 26-4) ¶ 4.)
Also on May 1, 2014, DPD officers executed a search warrant
for Henderson’s residence. During the search, Claimant arrived
at the residence with her attorney. (Pl.’s Br. at 4; Black Decl.
(Doc. 26-3) ¶¶ 8, 9.) DPD officers located a safe in the master
bedroom closet. (Id. ¶ 9.) Inside the safe, officers found
$240,100.00 in U.S. currency, all of which was in $100 bills
wrapped in rubber bands. (Id. ¶ 10; Pl.’s Br., GE H, Deposition
of Shunika Hemingway Henderson (“Claimant’s Dep.”) (Doc. 26-9)
at 41.)1 Officers seized and sealed the $240,100.00 in currency
in front of Claimant and her attorney; it was later taken to the
Raleigh DEA Office where it was secured. (Walker Decl. (Doc.
26-2) ¶ 19.)

All citations in this Memorandum Opinion and Order to
documents filed with the court refer to the page numbers located
at the bottom right-hand corner of the documents as they appear
on CM/ECF.
1

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On April 11, 2016, Henderson pleaded guilty in Durham
County Superior Court to possession with intent to distribute,
in violation of N.C. Gen. Stat. § 90-95(a)(1). (Pl.’s Br., GE L,
Doc. 26-13 at 3.) Henderson received a suspended sentence for
twelve months of supervised probation. (Id. at 4.) He was also
ordered to “forfeit all seized property and contraband.” (Id.)
For the tax years 1999 through 2010, Henderson reported
income ranging from $11,586 to $33,734. (Pl.’s Br., GE I (Doc.
26-10) at 6, 9, 14.) In 2001 and 2002 Henderson filed jointly
with Claimant wherein the total income reported was $34,249 and
$37,219. (Id. at 6.) Henderson’s income came from his business,
rental properties, and interest. (Doc. 26-10.) Henderson did not
provide more recent tax returns, but testified that his recent
income “probably just went up a little bit.” (Pl.’s Br., GE G,
Deposition of Anthony Henderson (“Henderson Dep.”) (Doc. 26-8)
at 12.)
Claimant’s reported income from 2008 to 2014 ranged between
$28,940 and $36,850. (Pl.’s Br., GE J (Doc. 26-11).) Her job as
a probation/parole officer has been her only source of income
since 2004. (Pl.’s Br., GE F, Interrogatories Directed to
Claimant (Doc. 26-7) at 9.)
In addition to Henderson’s reported income, he testified he
earned money landscaping and doing “side tows” towing cars, but
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he could not estimate how much he earned or present any
documentation to evidence this income. (Henderson Dep. (Doc.
26-8) at 4-10.) Claimant stated in her Interrogatories that in
addition to Henderson’s body shop business, Henderson was
moonlighting by painting cars. (Doc. 26-7 at 7.) Henderson
testified he put some of these earnings in the bank and some he
put in the safe or gave to Claimant to put in the safe.
(Henderson Dep. (Doc. 26-8) at 17.) Henderson testified that he
did not make any money from selling drugs. (Id. at 28-29.)
At the time of Henderson’s arrest, Claimant was driving a
BMW 7 Series, with a current tax value estimated at $23,530.
(Id. at 33; Doc. 26-7 at 11.) Henderson testified that he
purchased the BMW using insurance money from a totaled Mercedes,
money from selling another Mercedes, and cash from his business.
(Henderson Dep. (Doc. 26-8) at 34-39.) Henderson testified that
Claimant never asked him where the cash came from. (Id. at 39.)
Henderson also owned a 2004 Cadillac Escalade, a 2009 BMW
7 Series, and a 2011 Ford F-150. (Id. at 14, 41-42.) He
testified he paid for these with money saved from either his
body shop, landscaping, or towing. (Id. at 15.) As for other
household expenses, Henderson testified that he and his wife
split the mortgage (id. at 31-32), and that he also paid for
groceries, kids’ clothes, and dental bills (id. at 41).
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Claimant testified that Henderson had paid the full $1,900
monthly mortgage since 2009. (Claimant’s Dep. (Doc. 26-9) at 2324.) Claimant also testified that since approximately 2008,
Henderson paid household expenses such as food, necessities,
kids’ clothes, utility bills, and the full mortgage, as well as
paying approximately $600 per month in child support to another
woman. (Id. at 6-7, 20-21.) Claimant testified that her expenses
exceed her income. (Id. at 56.)
Henderson testified that he bought the safe. (Henderson
Dep. (Doc. 26-8) at 24.) However, he testified that Claimant was
also putting money in the safe. (Id. at 20-21, 30.) Claimant
testified that she bought the safe but she never used it and
never put any money into it. (Claimant’s Dep. (Doc. 26-9) at
27-28, 44.) She further testified she saw the safe open only
once or twice in the early 2000s. (Id. at 29.) She testified she
never questioned Henderson about the safe or asked how much
money was in it. (Id. at 30-31, 39, 45.) Claimant was aware that
Henderson had nice cars and that he paid for them with cash but
this did not cause her any concern and she did not ask him where
the cash came from. (Id. at 47-51.)
Claimant was a probation/parole officer in Durham from 2004
to 2013, and has been a supervising officer since 2013. (Id. at
9-10.) During that time, she has supervised drug offenders and
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is familiar with the drug scene in Durham. (Id. at 11.) She is
aware that cocaine is a big issue in Durham, and she has
supervised parolees who sold crack cocaine. (Id. at 12-13.)
Claimant has performed searches of parolees when something
triggered suspicion, such as the parolees being around a certain
crowd or if the parolees were wearing expensive things even
though they were not working. (Id. at 15, 17.)
Claimant testified that she would go to the body shop every
day up until Henderson was arrested. (Id. at 34.) The body shop
was in a drug-infested area, and Claimant believed some of the
employees may have had a chemical addiction but she never
expressed any concerns about it to Henderson. (Id. at 35-38.)
Claimant and Henderson separated on May 19, 2014, following
his arrest. (Id. at 26-27.) They are not divorced, nor is there
any agreement regarding the marital property division. (Id. at
57-59.)
When asked if she was confident that the Defendant Property
was not drug money from Henderson dealing drugs, she responded,
“With [Henderson] taking that plea, no, I can’t say that.” (Id.
at 60.)
II.

LEGAL STANDARD
Summary judgment is appropriate where an examination of the

pleadings, affidavits, and other proper discovery materials
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before the court demonstrates that no genuine issue of material
fact exists, thus entitling the moving party to judgment as a
matter of law. Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett,
477 U.S. 317, 322–23 (1986). The moving party bears the burden
of initially demonstrating the absence of a genuine issue of
material fact. Celotex, 477 U.S. at 323.
If the moving party has met that burden, then the nonmoving
party must persuade the court that a genuine issue remains for
trial. This requires “more than simply show[ing] that there is
some metaphysical doubt as to the material facts;” the
“nonmoving party must come forward with ‘specific facts showing
that there is a genuine issue for trial.’” Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586–87 (1986)
(citations omitted) (quoting Fed. R. Civ. P. 56(e)). In
considering a motion for summary judgment, the court is not to
weigh the evidence, but rather must determine whether there is a
genuine dispute as to a material issue. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 250 (1986).
Nonetheless, the court must ensure that the facts it
considers can be “presented in a form that would be admissible
in evidence” and that any affidavits or evidence used to support
or oppose a motion are “made on personal knowledge, set out
facts that would be admissible in evidence, and show that the
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affiant or declarant is competent to testify on the matters
stated.” See Fed. R. Civ. P. 56(c)(2), (4).
The court must view the facts in the light most favorable
to the nonmoving party, drawing inferences favorable to that
party if such inferences are reasonable. Anderson, 477 U.S. at
255. However, there must be more than a factual dispute, the
fact in question must be material, and the dispute must be
genuine. Fed. R. Civ. P. 56(c); Anderson, 477 U.S. at 248. A
dispute is only “genuine” if “the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.”
Anderson, 477 U.S. at 248.
III. ANALYSIS
The Government raises three issues: (1) whether Claimant
lacks standing to assert her claim contesting forfeiture; (2)
whether the Defendant Property is forfeitable; and (3) whether
Claimant, if she has standing, can establish that she is an
innocent owner of the Defendant Property. (See Pl.’s Br. (Doc.
26) at 9-10.)
A.

Whether Claimant has Standing to Contest Forfeiture

In the civil forfeiture context, a claimant must establish
both constitutional and statutory standing. United States v.
$7,000.00 in U.S. Currency, 583 F. Supp. 2d 725, 729 (M.D.N.C.
2008). The Government asserts that Claimant cannot demonstrate
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Article III/constitutional standing, prudential standing, or
statutory standing to bring her claim. (Pl.’s Br. (Doc. 26) at
10.)
Article III of the United States Constitution limits the
jurisdiction of federal courts to “Cases” or “Controversies.”
U.S. Const. art. III, § 2. For Article III standing to exist,
the claimant must be injured, and a federal court must be able
to redress the injury. CGM, LLC v. BellSouth Telecomms., Inc.,
664 F.3d 46, 52 (4th Cir. 2011). To contest a government
forfeiture action, the claimant “must have a colorable
ownership, possessory or security interest in at least a portion
of the defendant property.” United States v. Munson, 477
F. App’x 57, 62 (4th Cir. 2012) (unpublished). Stated another
way, Claimant must have a “legally cognizable interest in the
property that will be injured if the property is forfeited to
the government”; this injury must be “real and immediate, and
not conjectural or hypothetical.” $7,000.00 in U.S. Currency,
583 F. Supp. 2d at 729 (internal citations and quotations
omitted).
Prudential standing has been said to encompass several
judicially-created limits on federal jurisdiction, including
“the general prohibition on a litigant's raising another
person's legal rights, the rule barring adjudication of
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generalized grievances more appropriately addressed in the
representative branches, and the requirement that a plaintiff's
complaint fall within the zone of interests protected by the law
invoked.” Lexmark Int'l, Inc. v. Static Control Components,
Inc., 572 U.S. ____, ____, 134 S. Ct. 1377, 1386 (2014)
(internal quotation marks and citations omitted). However, the
Supreme Court “clarified that the zone of interests concern
refers to an issue of statutory authorization, the generalized
grievance concern an issue of ‘constitutional’ dimensions, and
the third-party standing concern an issue that is ‘harder to
classify.’” United States v. Under Seal, 853 F.3d 706, 722 n.5
(4th Cir. 2017) (quoting Lexmark, 134 S. Ct. at 1387 & n.3).
Statutory standing concerns whether a statute has accorded
this particular injured plaintiff the right to sue the defendant
to redress the injury, or “whether the plaintiff ‘is a member of
the class given authority by a statute to bring suit.’” CGM, 664
F.3d at 52 (quoting In re Mutual Funds Inv. Litig., 529 F.3d
207, 216 (4th Cir. 2008)). “[T]he touchstone for [statutory]
standing is the possession of a legal interest in the forfeited
property.” United States v. Oregon, 671 F.3d 484, 490 (4th Cir.
2012) (appeal of criminal forfeiture proceeding). “[I]f a
petitioner has not asserted a ‘legal interest’ in property
subject to forfeiture,” then the “petition should be dismissed
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on the issue of standing.” United States v. Alquzah, 91 F. Supp.
3d 818, 825 (W.D.N.C. 2015).
Claimant bears the burden of establishing standing to
pursue her claim by a preponderance of the evidence. United
States v. 998 Cotton St., Forsyth Cty., N.C., No. 1:11-CV-356,
2013 WL 1192821, at *5 (M.D.N.C. Mar. 22, 2013). Claimant
asserts she has an interest in the Defendant Property because it
is marital property. 2 (Claimant’s Mem. in Opp’n to Mot. for Summ.
J. (“Claimant’s Resp.”) (Doc. 29) at 1-2.) The Government
asserts that Claimant does not have a legal interest in the
Defendant Property, and therefore, does not have standing.
(Pl.’s Br. (Doc. 26) at 11.) Legal interests in property are
generally determined pursuant to state law. Oregon, 671 F.3d at
490; 998 Cotton St., 2013 WL 1192821, at *6. Accordingly, this
court will examine North Carolina law on this issue.
Claimant admits that she never put money in the safe and
that the Defendant Property belonged to Henderson. (Claimant’s
Dep. (Doc. 26-9) at 27-28, 44.) However, Claimant asserts that

2

The requirement that a claimant establish an ownership
interest in the defendant property as part of her § 983 innocent
ownership affirmative defense to forfeiture is distinct from her
duty to establish that she has standing to contest the
forfeiture. A claimant may have standing without being an owner
of the property. United States v. Munson, 477 F. App’x 57, 67
n.10 (4th Cir. 2012).
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she has a marital interest in the Defendant Property because,
under North Carolina’s equitable distribution statute, marital
property consists of “all real and personal property acquired by
either spouse or both spouses during the course of the marriage
and before the date of the separation.” N.C. Gen. Stat.
§ 50-20(b)(1); (Claimant’s Resp. (Doc. 29) at 1.) Claimant
asserts that she has an interest in the Defendant Property
because it is marital property, and because pursuant to
§ 50-20(a), she has a right to an equitable distribution of
marital property. N.C. Gen. Stat. § 50-20(a).
The right to an equitable distribution is a statutory
right, not a legal right to any specific piece of marital
property. The classification of property as marital property
“does not give one spouse an equitable title to or an interest
in the separately-owned property of the other. Courts
interpreting North Carolina's equitable distribution statutes
have uniformly reached this conclusion.” In re Halverson, 151
B.R. 358, 362 (Bankr. M.D.N.C. 1993). “While the effect of the
[statute] is to give the non-title[d] spouse an equitable claim
in marital property, it does not displace the traditional
principles of property ownership.” Hagler v. Hagler, 319 N.C.
287, 290, 354 S.E.2d 228, 232 (1987); 998 Cotton St., 2013 WL
1192821, at *6.
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Although pursuant to § 50-20(k), this statutory right vests
at the time of separation, it “does not create a property right
in marital property. Nor does the separation create a lien on
specific marital property in favor of the spouse.” Hearndon v.
Hearndon, 132 N.C. App. 98, 101, 510 S.E.2d 183, 185 (1999)
(citations omitted). This statute creates only “a right to the
equitable distribution of that property, whatever a court should
determine that property is.” Wilson v. Wilson, 73 N.C. App. 96,
99, 325 S.E.2d 668, 670 (1985). However, in the absence of an
equitable distribution under § 50-20, the ownership rights of
either spouse or both spouses is unaffected – nothing in the
statute creates a new form of ownership. See Hagler, 319 N.C. at
290, 354 S.E.2d at 232.
This “approach by North Carolina courts has been applied by
[a federal district] court in a forfeiture proceeding under 21
U.S.C. § 881(a) and 18 U.S.C. § 983(d).” 998 Cotton St., 2013 WL
1192821, at *7. In United States v. 1999 Starcraft Camper
Trailer, VIN # 1SABS02R8X1UR3942, No. 1:05CV273, 2006 WL 2921722
(M.D.N.C. Oct. 10, 2006), the claimant asserted an ownership
interest in a camper trailer arguing that it was marital
property as defined by North Carolina’s equitable distribution
statute. Id. at *3. The court rejected this argument stating
that “the equitable distribution statue does not create a
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substantive property right in marital property. [The claimant]
cannot establish that she is an owner of the Camper simply
because it would be classified as marital property if the
[claimant and her husband] were to separate and seek equitable
distribution of their marital property.” Id. at *4. Because the
claimant could not establish that she was an owner of the
camper, her claim of ownership was dismissed. Id.
Similarly, in this case, Claimant concedes that the
Defendant Property is not her money, but asserts an ownership
interest to it through her marriage to Henderson. Claimant and
Henderson have separated, but there is no evidence that there
has been an equitable distribution or that an equitable
distribution will take place. (Claimant’s Resp. (Doc. 29) at 6.)
Claimant’s assumption that her expectancy in an equitable
distribution claim to marital property gives her an ownership
interest in the Defendant Property is a conclusion not supported
by North Carolina law. 3 “Her argument incorrectly equates a claim
for equitable distribution with an ownership interest in

3

Claimant also asserts that because she may be due postseparation support, alimony, or child support in a later state
court action, she should be able to assert rights to the
Defendant Property. (Answer (Doc. 6) ¶ 10; Claimant’s Resp.
(Doc. 29) at 6.) These possible future claims under Chapter 50
of N.C. Gen. Stat. likewise do not give Claimant an ownership
interest or property right in specific marital property or in
the Defendant Property.
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property. . . . Under N.C. Gen. Stat. § 50–20, [it has been]
consistently held that an equitable distribution claim is not a
property right in specific marital property.” Kroh v. Kroh, 154
N.C. App. 198, 201, 571 S.E.2d 643, 645 (2002). Consequently,
because Claimant lacks a legal ownership interest in the
Defendant Property, she lacks standing to contest its
forfeiture.
B.

Whether Defendant Property is Subject to Forfeiture

Although this court concludes that Plaintiff lacks
standing, the Government still must demonstrate that the
Defendant Property is subject to forfeiture. Property that may
be subject to civil forfeiture to the United States is found in
18 U.S.C. § 981. Section 983 of Title 18 sets forth certain
rules governing civil forfeiture proceedings. The Government
bears the initial burden of proof to establish by a
preponderance of the evidence that the property in question is
subject to forfeiture. 18 U.S.C. § 983(c). If the theory of
forfeiture “is that the property was used to commit or
facilitate the commission of a criminal offense, or was involved
in the commission of a criminal offense,” the Government must
also establish that there was a “substantial connection between
the property and the offense.” 18 U.S.C. § 983(c)(3). This court
must look to the totality of the circumstances to determine
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whether the Government has met its burden. United States v.
Thomas, 913 F.2d 1111, 1115 (4th Cir. 1990) (applying earlier
probable cause standard but noting that courts must avoid
evaluating evidence in isolation). If the Government makes an
initial showing that the Defendant Property is properly subject
to forfeiture, the burden then shifts to Claimant to establish
the affirmative defense of innocent ownership by a preponderance
of the evidence. 18 U.S.C. § 983(d); Munson, 477 F. App’x at
65-66.
The Government contends the Defendant Property is subject
to forfeiture under either 21 U.S.C. § 881(a)(6), which allows
for forfeiture to the United States for “[a]ll moneys . . .
furnished or intended to be furnished by any person in exchange
for a controlled substance [and] all proceeds traceable to such
an exchange,” or 18 U.S.C. § 981(a)(1)(C), for “[a]ny property,
real or personal, which constitutes or is derived from proceeds
traceable to . . . any offense constituting ‘specified unlawful
activity’ (as defined in section 1956(c)(7) of [Title 18]).”
(See Pl.’s Br. (Doc. 26) at 15-16.) Section 1956(c)(7)
incorporates “any act or activity constituting an offense listed
in section 1961(1),” which includes dealing in a controlled
substance or any offense involving the felonious manufacture,
importation, receiving, concealment, buying, selling, or
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otherwise dealing in a controlled substance. 18 U.S.C.
§§ 1956(c)(7), 1961(1).
“The government may rely on circumstantial evidence to
establish forfeitability.” United States v. Herder, 594 F.3d
352, 364 (4th Cir. 2010) (discussing substantial connection test
in criminal forfeiture proceeding). Moreover, “[p]roceeds need
not be tied to any particular identifiable drug transaction.”
998 Cotton St., 2013 WL 1192821, at *13 (citing United States v.
1982 Yukon Delta Houseboat, 774 F.2d 1432, 1435 n.4 (9th Cir.
1985)). “Under the substantial connection test, . . . [a]t
minimum, the property must have more than an incidental or
fortuitous connection to criminal activity”, but it need not be
“integral, essential or indispensable” to that activity. United
States v. Schifferli, 895 F.2d 987, 990 (4th Cir. 1990)
(discussing forfeiture of real property). “A common sense
reality of everyday life is that legitimate businesses do not
transport large quantities of cash rubber-banded into
bundles . . . .” United States v. $242,484.00, 389 F.3d 1149,
1161 (11th Cir. 2004); see also United States v. Puche-Garcia,
No. 99-1612, 2000 WL 1288181 (4th Cir. Sept. 13, 2000)
(unpublished). “Insufficient legitimate income to explain
expenditures, along with evidence of drug trafficking, is
evidence of property derived illegally.” 998 Cotton St., 2013 WL
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1192821, at *13 (citing cases). “The mere allegation of a highly
unlikely legitimate source of income without some support to
give the allegation credibility cannot constitute an issue of
material fact defeating summary judgment for forfeiture.” United
States v. 94,200.00 in U.S. Currency, Civil No. 1:11CV00609,
2012 WL 2885129, at *6 (M.D.N.C. July 13, 2012) (quotations
omitted).
The Government has satisfied its burden that there is a
substantial connection to criminal activity for purposes of
forfeiture. DPD made several controlled purchases of crack
cocaine from Henderson beginning in 2011. Later, in 2016,
Henderson pled guilty to possession with intent to distribute.
Henderson’s assertion that he did not make any money from
selling drugs is taken with great skepticism. As the Government
pointed out, it is a “common sense recognition that drug dealing
is a dangerous and often violent enterprise,” United States v.
Smith, 914 F.2d 565, 567 (4th Cir. 1990), and it is implausible
to believe that Henderson engaged in such activities without
financial gain. Claimant also concedes that some of the money
may be drug money. (Claimant’s Resp. (Doc. 29) at 5.)
The record demonstrates illegal drug activity by Henderson,
and the documentation presented revealed expenditures exceeding
Henderson’s legitimate income. See United States v. Funds in
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Amount of Thirty Thousand Six Hundred Seventy Dollars, 403 F.3d
448, 468-69 (7th Cir. 2005) (finding totality of circumstances
supported summary judgment where seized funds and expenditures
exceeded stated income and no documentation or other proof was
offered to account for this discrepancy). Henderson’s reported
income was at most $33,734 and $37,219 jointly, but he had
monthly expenditures of a $1,900 mortgage, a $600 child support
obligation, additional expenses for his children with Claimant,
as well as car expenses, groceries, utilities, and other
household expenses. Although Claimant and Henderson testified
that Henderson had other sources of income, they provided no
supporting documentation. See United States v. $174,206.00 in
U.S. Currency, 320 F.3d 658, 662 (6th Cir. 2003) (affirming
forfeiture where “evidence of legitimate income [was]
insufficient to explain the large amount of property seized,
unrebutted by any evidence pointing to any other source of
legitimate income or any evidence indicating innocent
ownership”). Evidence that Henderson’s expenditures exceeded his
verifiable legitimate income, along with the possession of an
unusually large amount of cash rubber-banded into bundles and
hidden in a bedroom closet suggests that the Defendant Property
was derived illegally. See United States v. $63,289.00 in U.S.
Currency, No. 3:13-cv-00281-FDW-DCK, 2014 WL 2968555, at *5-6
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(W.D.N.C. July 1, 2014); United States v. $2,500 in U.S.
Currency, 689 F.2d 10, 16 (2d Cir. 1982) (acknowledging that “[a
large] quantity of cash is [not] commonly kept in residential
premises by law-abiding wage earners”). Therefore, this court
concludes that the totality of the record demonstrates
sufficient evidence to establish by a preponderance of the
evidence a substantial connection between the Defendant Property
and illegal drug activity to allow for forfeiture.
Having determined that the Defendant Property is
forfeitable, this court must address Claimant’s argument that
the forfeiture violates the excessive fines clause of the Eighth
Amendment to the Constitution of the United States. (Claimant’s
Resp. (Doc. 29) at 10-11.) This court first notes that Claimant
did not raise this defense in her Answer, initially raising it
in her response to Plaintiff’s motion for summary judgment. As a
general rule, affirmative defenses are waived if they are not
pled in a responsive pleading as required by Federal Rule 8(c).
See Fed. R. Civ. P. 8(c)(1); RCSH Operations, L.L.C. v. Third
Crystal Park Assocs. L.P., 115 F. App’x 621, 629 (4th Cir.
2004). However, an affirmative defense not asserted in an answer
or motion is not automatically waived, but requires a showing of
prejudice or unfair surprise, neither of which the Government

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has argued. S. Wallace Edwards & Sons, Inc. v. Cincinnati Ins.
Co., 353 F.3d 367, 373 (4th Cir. 2003).
Pursuant to 18 U.S.C. § 983(g), any person claiming an
interest in the seized property may petition the court to
determine whether the forfeiture was constitutionally excessive.
This court has found that Claimant lacks an ownership interest
in the Defendant Property and lacks standing to contest its
forfeiture. Therefore, Claimant likely lacks standing to
challenge the forfeiture on grounds that it is an excessive
fine. See United States v. Cochenour, 441 F.3d 599, 601 (8th
Cir. 2006). However, even if Claimant had standing to petition
the court on such grounds, she has not carried her burden.
The Eighth Amendment provides that “[e]xcessive bail shall
not be required, nor excessive fines imposed, nor cruel and
unusual punishments inflicted.” U.S. Const. amend. VIII. A
forfeiture of property violates the Excessive Fines Clause of
the Eighth Amendment if it is grossly disproportional to the
gravity of the offense. 18 U.S.C. § 983(g); see also United
States v. $79,650.00 Seized from Bank of Am. Account Ending in
8247, 650 F.3d 381, 388 (4th Cir. 2011), as corrected (June 2,
2011) (citing United States v. Bajakajian, 524 U.S. 321, 336
(1998)). The burden is on the party challenging the
constitutionality of the forfeiture to demonstrate
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excessiveness. 18 U.S.C. § 983(g); see also United States v.
Ahmad, 213 F.3d 805, 816 (4th Cir. 2000).
Here, Claimant has not carried her burden on this point.
Claimant has offered no legal argument or evidence demonstrating
why the forfeiture would be an excessive fine. Claimant has
failed to provide any substantive legal analysis that would
support this court finding in her favor. Claimant has not even
acknowledged the criteria this court must consider to make a
finding that a forfeiture is grossly disproportionate. This
court therefore finds Claimant has failed to carry her burden
and has not presented any argument to support a finding that the
forfeiture would violate the Excessive Fines Clause of the
Eighth Amendment.
C.

Whether Claimant is an Innocent Owner

Claimant asserts that she is an innocent owner of the
Defendant Property pursuant to 18 U.S.C. § 983(d). (Answer (Doc.
6) ¶¶ 16-17; Claimant’s Resp. (Doc. 29) at 3.) Claimant has the
burden of proving she is an innocent owner by a preponderance of
the evidence. 18 U.S.C. § 983(d)(1). An “owner” for purposes of
§ 983(d) is “a person with an ownership interest in the specific
property sought to be forfeited.” 18 U.S.C. § 983(d)(6)(A). The
term “owner” has been construed “‘to include any person with a
recognizable legal or equitable interest in the property
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seized.’” 998 Cotton St., 2013 WL 1192821, at *6 (quoting United
States v. 92 Buena Vista Ave., 937 F.2d 98, 102 (3d Cir. 1991)).
An innocent owner is one who “did not know of the conduct giving
rise to forfeiture” or “upon learning of the conduct giving rise
to the forfeiture, did all that reasonably could be expected
under the circumstances to terminate such use of the property.”
18 U.S.C. § 983(d)(2)(A).
Claimant admitted that the money in the safe was not hers,
but asserts an ownership interest in the Defendant Property as
marital property. Because this court finds that Claimant lacks
an ownership interest in the Defendant Property as marital
property, as previously discussed, she is not an “owner” and
therefore cannot be an “innocent owner” pursuant to 18 U.S.C.
§ 983. See 998 Cotton St., 2013 WL 1192821, at *9; Munson, 477
F. App’x at 67 (citing Stefan D. Cassella, The Uniform Innocent
Owner Defense to Civil Asset Forfeiture, 89 K.Y. L.J. 653, 672
(2001), for proposition that if the claimant cannot establish
that she has an ownership interest, her innocence is
irrelevant). Even if Claimant was an owner of the Defendant
Property, she has failed to prove the “innocent owner”
affirmative defense as required by 18 U.S.C. § 983(d)(1).
Claimant acknowledges that she “foolishly” trusted Henderson.
(Claimant’s Resp. (Doc. 29) at 8.) She admits that she never
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questioned Henderson about the safe or about where the cash came
from to purchase her BMW or the other cars or household
expenses. Despite her knowledge of Henderson’s business and
despite her years of experience as a probation/parole officer,
she never expressed any concerns to Henderson.
Taken in its totality, Claimant’s explanation is too
coincidental and implausible. See $63,289.00 in U.S. Currency,
2014 WL 2968555, at *7 (“False, conflicting or implausible
explanations undermine a claimant's credibility and justify any
fact-finder's skepticism.”). Claimant’s acceptance of
Henderson’s spending and dealings in cash “with little or no
explanation of the source of money strongly suggests that
she . . . was willfully blind to [Henderson’s] illegal source of
income.” Id. Willful blindness is “a well-settled principle of
law where knowledge of a fact may be inferred where an
individual deliberately closes their eyes to what would
otherwise be obvious.” Id. As such, Claimant has failed to
satisfy her burden of proving she is an innocent owner.
IV.

CONCLUSION
This court finds that the Government established by a

preponderance of the evidence that the Defendant Property is
subject to forfeiture and that Claimant failed to satisfy her
burden in proving the innocent owner defense. IT IS THEREFORE
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ORDERED that the Government’s Motion for Summary Judgment (Doc.
25) is hereby GRANTED.
IT IS FURTHER ORDERED that the $240,100.00 in U.S. Currency
shall be and is HEREBY FORFEITED to the United States pursuant
to 21 U.S.C. § 881(a)(6).
A judgment in accordance with this Memorandum Opinion and
Order will be entered contemporaneously herewith.
This the 25th day of May, 2017.

_______________________________________________________________
United States District Judge

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