USA v. $164705 US Currency, et al
REPORT AND RECOMMENDATION:For the reasons stated above, the undersigned RECOMMENDS that both Motions for Summary Judgment be DENIED. Under Rule 72(b) of the Federal Rules of Civil Procedure, any party has fourteen (14) days from receipt of this Repor t and Recommendation within which to file with the District Court any written objections to the proposed findings and recommendations made herein. Any party opposing shall have fourteen (14) days from receipt of any objections filed regarding this Re port within which to file a response to said objections. Failure to file specific objections within fourteen (14) days of receipt of this Report and Recommendation may constitute a waiver of further appeal of this Recommendation. Thomas v. Arn, 474 U.S. 140, reh'g denied, 474 U.S. 1111 (1986). ENTERED this 28th day of September, 2011. Signed by Magistrate Judge Joe Brown on 9/28/2011. (xc:Pro se party by regular and certified mail.)(eh)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF TENNESSEE
UNITED STATES OF AMERICA,
$164,705.00 UNITED STATES CURRENCY,
$19,000.00 UNITED STATES CURRENCY,
and $4,300.00 UNITED STATES CURRENCY,
KENNETH LAMONT CRUTCHER,
Case No. 3:04-cv-00270
The Honorable Aleta A. Trauger, District Judge
REPORT AND RECOMMENDATION
The parties have filed Motions for Summary Judgment with accompanying memoranda.
(Docket Entries 151, 152, 157). Both parties have filed Responses1 and Replies. (Docket Entries
174, 177, 179, 180). The Government also filed a Statement of Facts, and Claimant’s response is
attached to the Government’s Reply. (Docket Entries 156, 179-1). Claimant did not file a
Statement of Facts. For the reasons set forth below, the Magistrate Judge RECOMMENDS both
Motions for Summary Judgment be DENIED.
The Government erroneously styled its Response as a Reply. (Docket Entry 174).
I. PROCEDURAL HISTORY
The procedural history of this action is long and complicated. In a recent Order, the Sixth
Circuit provided a concise overview of the case:
In 2006, a jury convicted Crutcher of conspiring to distribute
marijuana and cocaine, possessing with intent to distribute cocaine,
possessing firearms in furtherance of drug trafficking, and being a
felon in possession of firearms. The jury also returned a special
verdict form against him as to one count of forfeiture. The district
court sentenced him to life in prison, pursuant to 21 U.S.C. §§
841(b)(1)(A) and 851. A panel of this court affirmed Crutcher’s
convictions and sentence on appeal. United States v. Ogburn, 288
F. App’x 226 (6th Cir. 2008), cert. denied, 129 S. Ct. 1650 (2009).
Subsequently, Crutcher filed a motion for the return of property,
pursuant to Federal Rule of Criminal Procedure 41(g), seeking the
return of cash, four firearms, various documents, cell phones, and a
box of rubber bands. The district court denied the motion as to the
cash and firearms on the ground that those items were forfeited
pursuant to the special verdict form because they were possessed
in violation of federal law, but granted it as to the other
miscellaneous items. The district court also reopened the civil
forfeiture proceedings relating to the cash and firearms. On appeal,
a panel of this court affirmed the district court’s judgment. United
States v. Crutcher, No. 09-6343 (6th Cir. Oct. 13, 2010).
In April 2010, Crutcher filed a motion for an order of distribution,
seeking the return of the currency that was seized from him. On
May 5, 2010, the district court denied the motion because the issue
of Crutcher’s right to the forfeited currency was being litigated in a
civil forfeiture case, not the criminal case; the district court also
directed the parties to file any future pleadings concerning the
forfeiture in the civil case. The district court denied Crutcher’s
motion for reconsideration.
On appeal, Crutcher argued that the district court erred in denying
the return of his property and that permitting the government to
retain his property violated his rights against “double jeopardy.”
He also argued that the denial was improper because the
government failed to properly obtain a pre-trial order permitting
the retention of his property. We affirmed the district court’s order.
United States v. Crutcher, No. 10-5867 (6th Cir. June 22, 2011).
II. UNDISPUTED FACTS2
On October 27, 2003, law enforcement officers seized the disputed United States
Currency (“the defendant currency”) from Claimant Kenneth Lamont Crutcher’s (“Crutcher”)
vehicle and residence. When Crutcher was arrested at approximately 8 a.m., police found
$164,705 United States currency in his vehicle in a plastic bag on the second seat behind and in
Crutcher’s reach. The currency was bundled and wrapped with rubber bands and sorted by
denomination. Officer Clark read Crutcher his Miranda rights. Crutcher was taken to the DEA
office, where Task Force Officer (“TFO”) Marti Roberts advised him of his Miranda rights, and
Crutcher initialed his rights.
A search warrant for Crutcher’s house was executed on October 27, 2003, and officers
found two loaded handguns, a loaded shotgun. Officers also found and seized $19,000.00 and
$4,300 in United States currency, bundled and wrapped with rubber bands and sorted by
denominations, respectively from a chest drawer and from under a couch in the master bedroom
located at the Crutcher residence. In the master bedroom, law enforcement also found a safe with
53.2 grams of marijuana in it. Crutcher resided at 3106 Vailview Drive, Nashville, TN 37206
from November 1, 2002 through October 27, 2003, with his wife Kim Crutcher, sons Korey and
Kenneth Crutcher and daughter Kelli Crutcher.
As part of the criminal action, Judge Echols held a suppression hearing on September 23,
2004. Metropolitan Nashville Police Department (“MNPD”) Officer Mike Clark, DEA TFO
The facts are primarily taken from the Government’s Statement of Undisputed Facts
and Claimant’s Responses. (Docket Entries 156, 177, 179-1).
Marti Roberts, DEA Agent Matt Bradford, and Crutcher testified regarding whether Crutcher
cooperated with and made statements to law enforcement on October 27, 2003. Officer Roberts
testified that Crutcher cooperated by providing the following summarized information in front of
TBI Agent Smitherman:
Crutcher met Miguel through a friend of his by the name of
Newman. Crutcher identified the photograph of Miguel Hernandez
as Miguel. Miguel was Newman’s source of supply for cocaine.
Crutcher began to purchase kilogram quantities of cocaine through
Mr. Newman from Miguel Hernandez. Miguel owned a business
on Nolensville Road, Nashville, TN called Califas Auto Repair.
Eventually Crutcher and Miguel cut Newman out and Crutcher
dealt directly with Miguel to purchase kilogram quantities of
cocaine. Crutcher met “Shorty” through Miguel. Crutcher
identified a photograph of Andrez Miranda as “Short[y].” Miguel
told Crutcher that Miguel got his cocaine from Miranda. The
money in the car was intended for Miguel or his folks because
Crutcher had purchased maybe three or more kilograms of cocaine
a week prior to Crutcher’s arrest. The money in the car was to go
to Ulysses Hernandez (an associate of Miguel).
Crutcher was normally fronted kilogram quantities of cocaine
through Newman and eventually from Miguel and Miranda.
Crutcher claims he had saved the defendant currency over a two-and-one-half year
period. Crutcher relies upon tax returns and miscellaneous papers, including monthly bank
statements from Bank of America for his business account and his wife’s account and federal tax
returns for tax years 2000 through 2003. He also claims he had income from gambling and
buying and selling cars, equipment, and appliances. Attorney E.T. Kindall provided Crutcher’s
financial records to the United States. Crutcher provided copies of his 2001, 2002, and 2003
federal tax returns.
At his initial appearance in the criminal action on October 27, 2003, Crutcher denied
having any money in the bank or cash on hand and stated he averaged a take home income from
his business of about $3,300 per month. He listed his assets as two vehicles and a house, with
$3,000 per month income and monthly bills as $530 toward the house payment and $500 toward
a truck payment.
Crutcher last worked at “C & C Auto Upholstrey [sic] and Detail,” located at 2901 12th
Avenue South, Nashville, TN, a location rented by Crutcher for an auto detailing business. The
only bank records for C & C Auto show a beginning balance in January 2003 of $1,912.40 and
an ending balance of $3,475.55 on October 31, 2003. Crutcher estimated his monthly expenses,
totaling $3800 per month, and did not include expenses to pay employees or a salary for himself.
For tax year 2000, Crutcher filed an S Corporation return reflecting that C & C had gross
receipts of $71,136, but after expenses were deducted, with no deduction for employee salaries,
the ordinary income for the business was $1,726.
Crutcher and his wife’s joint federal tax return for tax year 2001 reflected that the
adjusted gross income for Crutcher and his wife was $24,533, with Kim Crutcher earning
$19,997 in wages and Crutcher’s business income as $4,881 after payment of $39,417 in
expenses and with no expenses taken to pay employees and no taxable interest declared. For tax
year 2002, the joint federal tax return reflected that the adjusted gross income for the Crutchers
was $38,571, with Kim Crutcher earning $21,533 of that in wages and Crutcher’s business
income as $15,312 after payment of $49,034 in expenses with no expenses to pay employees.
For tax year 2003, the Crutchers had an adjusted gross income of $51,511, with Kim Crutcher
earning $22,171 in wages and Crutcher’s business income as $28,380 after payment of $53,425
in expenses with no expenses to pay employees. Kim Crutcher was not involved in Crutcher’s
finances and did not know how much money he made from his business. Kim Crutcher’s salary
was directly deposited in the checking account.
Beginning in 2002, Crutcher’s tax returns refer to five Bank of America interest bearing
items. All were opened in 2002 or early 2003 and were still accruing interest as of October 31,
2003. The total of the five accounts was approximately $100,000.
With respect to Kenneth and Kim Crutcher’s personal checking account, Bank of
America records reflect that on January 8, 2003, the account had a balance of $1,698.23. On July
8, 2003, the account had an ending balance of $69.75, with two overdraft fees. On August 6,
2003, the account had an ending balance of $54.11, with one overdraft fee. On September 5,
2003, the account had an ending balance of $448.97, with one overdraft fee. On October 7, 2003,
the account had an ending balance of $917.50, with five overdraft fees. According to the
November 3, 2003 statement, the daily balance on October 24, 2003 was negative $377.08, with
six overdraft fees prior to October 24, 2003. A savings account belonging to both Kim and
Kenneth Crutcher had an average balance of $1069.24 on October 31, 2003 with no significant
withdrawals or deposits during 2003. Bank of America records reflect loan payments toward a 5year installment loan for which Kim Crutcher financed $30,000 to buy a Ford Expedition.
In a memorandum decision,3 Judge Echols credited Officer Clark’s testimony that
Crutcher told Officer Clark that he wanted to cooperate, including completing the delivery of the
money to Miguel Hernandez (“Hernandez”). Judge Echols also credited the testimony of Agent
Roberts that Crutcher agreed to cooperate and in fact cooperated by providing information in the
interview consistent with his admitted conduct of identifying and initialing photographs of
This decision is docket entry 496 in Crutcher’s criminal case, 3:03-cr-00205.
Hernandez and Andrez Miranda (“Miranda”). He found that Crutcher admitted he identified
photographs of co-defendants Hernandez and Miranda and initialed the photographs to indicate
his identification of them during the interview. He also found that Crutcher cooperated with the
Crutcher has prior felony convictions in 1986 in Davidson County Court Case number
86S768 for assault/attempted voluntary manslaughter, and in 1994 in Davidson County Court
number 92-D-2318, for two counts of selling over 26 grams of cocaine, one count of possession
with intent to sell over 300 grams of cocaine, one count of conspiracy to possess with intent to
sell over 300 grams of cocaine, and one count of felony possession of marijuana. Crutcher was in
prison from 1994 to 1998.
Crutcher was convicted of an illegal narcotics trafficking conspiracy to distribute
marijuana and five kilograms or more of cocaine from on or about November 1, 2002 to on or
about October 27, 2003 with Hernandez, Ulysses Espinosa (“Espinosa”), and Miranda. Crutcher
and Miranda were convicted of possession with the intent to distribute 500 grams or more of
cocaine on August 15, 2003, August 21, 2003, and September 10, 2003.
Crutcher, a convicted felon, was convicted of possessing a Maverick Model 88 12-gauge
shotgun, a Smith and Wesson Model 659 pistol, a Taurus PT111 IVC 9mm pistol, and a Smith
and Wesson .38 caliber pistol on October 27, 2003 in furtherance of the distribution and
possession with intent to distribute cocaine and marijuana.
In the criminal action, Hernandez was convicted of the conspiracy by arranging for the
delivery of two kilograms of cocaine from Miranda on July 28, 2003. Espinoza was convicted of
possession with intent to distribute more than 500 grams of cocaine; on August 6, 2003, he
received approximately four kilograms of cocaine from Miranda’s runner, which Espinoza
delivered to Crutcher, receiving $51,380 in cash which was confiscated by police later the same
day. Miranda was convicted of the conspiracy and of possessing a firearm in furtherance of the
possession of cocaine with intent to distribute; he distributed kilogram quantities of cocaine to
Judge Echols found that wiretap recorded drug transactions established that Crutcher had
been involved in drug transactions in the minimal amount of 55 kilograms of cocaine. Agent
Bradford listened to and transcribed numerous phone calls between persons he identified as
Crutcher and Miranda in July through September 2003. These conversations detailed several
Crutcher’s conviction in the criminal case was affirmed by the Sixth Circuit Court of
Appeals. United States v. Ogburn and Crutcher, 288 Fed. App’x 226, *4 (6th Cir. 2008). The
Court found that Crutcher was arrested on October 27, 2003, and officers discovered a bag
containing $164,705 in cash in his vehicle, which Crutcher said he was taking to “Hernandez’s
II. LEGAL DISCUSSION
On July 28, 2010, Judge Trauger denied a similar Motion for Summary Judgment filed by
the Government. (Docket Entries 77, 78). The Government’s underlying argument does not
substantially differ legally from its prior Motion for Summary Judgment, and the Magistrate
Judge cites to Judge Trauger’s Order where appropriate.
A. Standard of Review
Summary judgment is appropriate if there is “no genuine dispute as to any material fact”
and “the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c). The main
inquiry is “whether the evidence presents a sufficient disagreement to require submission to a
jury or whether it is so one-sided that one party must prevail as a matter of law.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986). After sufficient time for discovery and upon
motion, Fed. R. Civ. P. 56(c) mandates summary judgment against a party who fails “to make a
showing sufficient to establish the existence of an element essential to that party’s case, and on
which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317,
When deciding a motion for summary judgment, the court must review the evidence and
draw all reasonable inferences in favor of the non-moving party. Ciminillo v. Streicher, 434
F.3d 461, 464 (6th Cir. 2006). In order to survive summary judgment, the non-moving party
“must set forth specific facts showing that there is a genuine issue for trial.” Anderson, 477 U.S.
at 250; Fed. R. Civ. P. 56(e). Thus, even if the nonmovant produces some evidence, the
production will not be sufficient to defeat summary judgment so long as no reasonable jury could
reach a finding on that issue in favor of the non-moving party. Anderson, 477 U.S. at 248. In
other words, the nonmovant must produce supporting factual evidence that is not “so
conclusively contradicted by the record that no reasonable jury could believe it.” Chappell v.
City of Cleveland, 585 F.3d 901, 906 (6th Cir. 2009). The mere existence of a scintilla of
evidence in support of the nonmoving party’s position will be insufficient to survive summary
judgment rather, there must be evidence on which the jury could reasonable find for the
nonmoving party. Anderson, 477 at 252.
B. Civil Forfeiture
Pursuant to 21 U.S.C. § 881(a)(6), the following property is subject to forfeiture by the
All moneys, negotiable instruments, securities or other things of value
furnished or intended to be furnished by any person in exchange for a
controlled substance or listed chemical in violation of this subchapter, all
proceeds traceable to such an exchange, and all moneys, negotiable
instruments, and securities used or intended to be used to facilitate any
violation of this subchapter.
Because the Government’s theory is that the defendant currency was used “to commit or
facilitate the commission of a criminal office, or was involved in the commission of a criminal
offense,” the Government must “establish that there was a substantial connection between the
property and the offense.” 18 U.S.C. § 983(c)(3). The Government must also prove that the
property is subject to forfeiture by a preponderance of the evidence. 18 U.S.C. § 983(c)(1). This
means that the Government must show that it is more likely than not that there was a substantial
connection between the defendant currency and the criminal violation.
1. The Government’s Motion
In many respects, The Government’s Motion is a restatement of its previous Motion for
Summary Judgment using a different basis, Judge Echols’s findings in the suppression hearing.
The Government also relies on Crutcher’s responses to financial interrogatories.
With respect to the suppression hearing, the Government argues that Judge Echols found
that Crutcher cooperated with law enforcement after his arrest and that he offered to deliver the
$164,705 to complete a drug deal, which precludes Crutcher from claiming innocent ownership
of the $164,705 pursuant to 18 U.S.C. §983(d). The Government argues that collateral estoppel,
or issue preclusion, applies to Crutcher’s offer of cooperation. The Magistrate Judge disagrees,
The Government previously argued that Crutcher’s criminal conviction, including the
special verdict, precluded Crutcher’s innocent owner claim in the civil forfeiture matter. Judge
Trauger rejected this argument, finding that the jury made no specific finding that Crutcher
intended to use the defendant currency to buy drugs or that the defendant currency was
specifically tied to his illegal drug activities. Judge Trauger also rejected the Government’s
argument that the officers’ trial testimony that Crutcher admitted he intended to use the
defendant currency to buy drugs, finding that a genuine issue of material fact existed as to
whether there was a substantial connection between Crutcher’s criminal violations and the
In order for collateral estoppel to preclude redetermination of an issue, five requirements
must be met:
1. the issue in the subsequent litigation is identical to that resolved in
the earlier litigation;
2. the issue was actually litigated and decided in the prior action;
3. the resolution of the issue was necessary and essential to a
judgment on the merits in the prior litigation;
4. the party to be estopped was a party to the prior litigation (or in
privity with such a party); and
5. the party to be estopped had a full and fair opportunity to litigate
Hammer v. INS, 195 F.3d 836, 840 (6th Cir. 1999). In the suppression order, Judge Echols found
that the currency obtained from Crutcher’s car should not be suppressed because exigent
circumstances existed for the search. (Docket Entry 152-1, pp. 29-31). With regard to Crutcher’s
statements to law enforcement shortly after his arrest, Judge Echols credited the statements of
the arresting officers and found that Crutcher validly waived his Sixth Amendment rights during
questioning. (Docket Entry 152-1, pp. 33-43).
The Magistrate Judge does not believe the suppression order creates no genuine issue of
material fact to preclude Crutcher’s innocent owner claim. Putting aside the fact that the
probable cause standard of an evidence suppression hearing is hardly equivalent to the
preponderance of the evidence standard here,4 the relation of the defendant currency obtained
from Crutcher’s vehicle to his criminal activity was not established by Judge Echols’s order and
was not even at issue. Crutcher apparently sought only to have the defendant currency and his
statements to arresting officers suppressed at trial. For the same reasons Judge Trauger rejected
the Government’s reliance on the jury verdict as collateral estoppel to Crutcher’s innocent owner
defense, the Magistrate Judge believes Judge Echols’s order cannot be used for collateral
The Government also argues that Crutcher’s responses to interrogatories related to his
finances show by a preponderance of the evidence, with no genuine issue of material fact, that
the defendant currency must be subject to forfeiture.5 The Magistrate Judge is unconvinced by
this argument. Crutcher alleges that the defendant currency is the product of his business,
See Maryland v. Pringle, 540 U.S. 366, 371 (2003) ("The probable-cause standard is
incapable of precise definition or quantification into percentages because it deals with
probabilities and depends on the totality of the circumstances.... Finely tuned standards
such as proof beyond a reasonable doubt or by a preponderance of the evidence ... have
no place in the probable-cause decision.").
This is, in fact, the only argument the Government makes with respect to the defendant
currency found in Crutcher’s residence, as that currency was not mentioned in Judge
gambling, and dealing in merchandise.6 While this is somewhat far-fetched, particularly with
respect to the $164,705 found in his vehicle, the Magistrate Judge believes Crutcher’s responses
raise more factual issues than they resolve, and the dispute will be best resolved at trial. The
Magistrate Judge therefore recommends the Government’s Motion for Summary Judgment be
2. Crutcher’s Motion
Crutcher has also moved for summary judgment, arguing that his right to privacy under
the Fourth Amendment was violated, that the Government failed to meet the minimum filing
requirements for a civil forfeiture, that no evidence exists to establish a connection between the
defendant currency and Crutcher’s unlawful drug transactions, and that the Government waived
its opportunity to argue that the defendant currency constituted proceeds of unlawful drug
transactions at Crutcher’s criminal trial and should therefore be estopped from bringing a civil
forfeiture. For the reasons set forth below, the Magistrate Judge believes this Motion should be
Crutcher’s first argument is essentially a restatement of the issues he raised in the
suppression hearing in his criminal case. It is clear that the validity of the search and seizure of
the $164,705 has already been established by Judge Echols, and collateral estoppel applies. See
Hammer, 195 F.3d at 840. However, Judge Trauger noted in her Order that Crutcher was
Of course, if Crutcher prevails, his failure to reveal these funds on his relevant tax
returns is, to say the least, problematic.
As noted by the Government, Crutcher’s argument is primarily an argument that the
Government has failed to state a claim under Fed. R. Civ. P. 12(b)(6). The Magistrate
Judge believes that this Motion should be denied under either the motion to dismiss or
the motion for summary judgment standard.
allowed to challenge the seizure under new precedent, Arizona v. Gant, 557 U.S. 332 (2009).
(Docket Entry 77, p. 8). At the time of Judge Trauger’s Order, the retroactive application of Gant
was pending before the Sixth Circuit in United States v. Buford, 632 F.3d 264 (6th Cir. 2011).
The Sixth Circuit held that “[a] police officer who reasonably relies on settled circuit precedent
that authorizes the search of a vehicle acts in objective good faith.” Id. at 276-77. Therefore,
regardless of the validity of the search under Gant, the Magistrate Judge believes the search was
conducted in good faith in reliance on established Sixth Circuit precedent, as found by Judge
Echols, and the $164,705 should not be suppressed in this civil forfeiture action.
Crutcher next argues that the Government’s complaint is insufficient due to its use of
“boilerplate language” in light of the more stringent pleading requirements for civil forfeiture
proceedings. The Government argues that the sworn Affidavit provided by DEA TFO Marti
Roberts clearly provides sufficient facts to provide a reasonable belief that the defendant
currency is subject to forfeiture. (Docket Entry 1). See Fed. R. Civ. P. Supp. R. G(2)(f)
(providing that the complaint must “state sufficiently detailed facts to support a reasonable belief
that the government will be able to meet its burden of proof at trial.”). Officer Roberts’s
Affidavit, attached to the Complaint, meets this standard by providing details of the arrest,
search, and seizure of the defendant currency that provide a reasonable belief that the
Government will establish the connection between the defendant currency and Crutcher’s
criminal activity by a preponderance of the evidence at trial.
In a related argument, Crutcher states that the Government has shown no evidence to
establish a connection between the defendant currency and Crutcher’s unlawful drug
transactions. For the same reasons that the Magistrate Judge believes the Government is not
entitled to summary judgment in this matter, Crutcher is not entitled, either. A genuine issue of
material fact exists as to whether the defendant currency was related to Crutcher’s criminal
activity. Therefore, the Magistrate Judge believes Crutcher is not entitled to summary judgment
on this point.
Crutcher’s final argument, that the Government should be estopped from bringing a civil
forfeiture matter, was considered and rejected in Judge Trauger’s July 28, 2010 Order. (Docket
Entry 77, pp. 7-8).
For the reasons stated above, the undersigned RECOMMENDS that both Motions for
Summary Judgment be DENIED.
Under Rule 72(b) of the Federal Rules of Civil Procedure, any party has fourteen (14)
days from receipt of this Report and Recommendation within which to file with the District
Court any written objections to the proposed findings and recommendations made herein. Any
party opposing shall have fourteen (14) days from receipt of any objections filed regarding this
Report within which to file a response to said objections. Failure to file specific objections
within fourteen (14) days of receipt of this Report and Recommendation may constitute a waiver
of further appeal of this Recommendation. Thomas v. Arn, 474 U.S. 140, reh’g denied, 474 U.S.
ENTERED this 28th day of September, 2011.
Joe B. Brown
United States Magistrate Judge
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