§950 Forfeitures, Probable Cause
Supreme Court holds lack of knowledge that home was purchased with drug proceeds is defense to forfeiture. (950) In a plurality opinion announced by Justice Stevens, the Supreme Court concluded that an owner’s lack of knowledge of the fact that her home had been purchased with the proceeds of illegal drug transactions constituted a defense to a forfeiture proceeding under the statute. In 1982 respondent received $240,000 from her boyfriend to purchase a home. In 1989 the government filed an in rem action against the parcel of land on which the home was located. There was probable cause to believe that the funds used to buy the house were proceeds of illegal drug trafficking, but respondent swore she had no knowledge of its origins. The plurality concluded that the “innocent owner” protection is not limited to bona fide purchasers. In addition, the government is not the owner of a property before forfeiture has been decreed. The two concurring Justices concluded that the result was correct because the “relation back” principle recited in 21 U.S.C. section 881(h) is the familiar, traditional one and the term “owner” in section 881(a)(6) bears its ordinary meaning. U.S. v. Parcel of Land Bldgs., Appurtenances and Improvements, Known as 92 Buena Vista Ave., Rumson, N.J., 507 U.S. 111, 113 S.Ct. 1126 (1993).
1st Circuit upholds denial of costs and attorneys’ fees in forfeiture action. (950) The district court found no probable cause to forfeit money seized from claimant’s house. The government moved immediately for a certificate of reasonable cause to appeal under 28 U.S.C. § 2465 so as not to be liable for costs. Claimant opposed the motion and sought attorneys’ fees under the Equal Access to Justice Act. The 1st Circuit upheld the denial of costs and attorneys’ fees to claimant, finding that there was probable cause to institute forfeiture proceedings, and that the government’s position was substantially justified. The district court erred in fixing the date of the probable cause hearing as the date at which the government must demonstrate probable cause. The government was only required to show that it had probable cause to institute forfeiture proceedings. The district court erred in ruling that the government’s errors in handling and accounting for the money vitiated the existence of probable cause. U.S. v. Parcels of Property, 9 F.3d 1000 (1st Cir. 1993).
1st Circuit upholds probable cause determination based upon DEA agent’s affidavit detailing drug arrests on property. (950) The district court determined that there was probable cause to forfeit claimant’s real property based upon a DEA’s agent affidavit stating that over a four-year period, the property was the site or more than 29 drug-related arrests. The 1st Circuit rejected claimant’s contention that the affidavit contained unreliable hearsay. The reliability of the affidavit was substantiated by its supporting documentation pertaining to extensive illegal activity at the property and by the accompanying affidavits of two police officers, attesting to the accuracy of the representations made in the DEA affidavit. U.S. v. Parcel of Land and Residence at 18 Oakwood Street, 958 F.2d 1 (1st Cir. 1992).
2nd Circuit says stipulations barred using allegations in amended complaint to show probable cause. (950) The government seized a bank’s interbank account which contained about $7 million. To expedite the return of funds that were not linked to criminal activity, the bank agreed to produce its records regarding the interbank account at the time of the seizure. This agreement was finalized as a stipulation that was signed by the court. The government subsequently used the bank’s records as the basis for an amended forfeiture complaint. The 2nd Circuit held that the stipulation barred the government from using the allegations in the amended complaint to establish probable cause that the entire account was forfeitable. The allegations in the amended complaint derived entirely from the government’s examination of the interbank records and the stipulation barred the government from using the records to establish probable cause against money not attributable to money orders. Marine Midland Bank v. U.S., 11 F.3d 1119 (2nd Cir. 1993).
2nd Circuit says affidavit established probable cause to seize funds in interbank account. (950) The government seized a bank’s interbank account. The warrant was supported by the affidavit of a postal inspector which described in detail the postal service’s investigation of the drug cartel’s use of money orders to launder narcotics proceeds through the interbank account. The 2nd Circuit held that the affidavit established probable cause to seize the funds in the interbank accounts that were attributable to money orders. The affidavit was not the functional equivalent of a drug courier profile. It was the result of a 13-month investigation into the Colombian drug cartel’s laundering scheme. The affidavit described a specific modus operandi, and was not a mere profile compiled from the general behavior of drug cartels. However, the court remanded for a determination of whether 18 U.S.C. § 984 required the release of the funds derived from money orders. Marine Midland Bank v. U.S., 11 F.3d 1119 (2nd Cir. 1993).
2nd Circuit upholds warrantless seizure of electronic transfer funds. (950) The 2nd Circuit upheld the warrantless seizure of funds being electronically transferred. Under 21 U.S.C. section 881(b)(4), when the Attorney General has probable cause to believe that property is subject to forfeiture under section 881, the government is authorized to seize the property without judicial process. Here, the Assistant U.S. Attorneys, as representatives of the Attorney General, clearly had such probable cause. This was not a case in which the government stumbled into a seizure without any prior information about the subject property. The government knew that the head of a Colombian drug cartel, who had already been indicted for various drug and money laundering violations, would probably be directing the transfer of illicit income through particular New York banks to the accounts of several of his businesses in Colombia. In addition, as required by statute, the government initiated forfeiture proceedings promptly and in accordance with applicable customs laws. U.S. v. Daccarett, 6 F.3d 37 (2nd Cir. 1993).
2nd Circuit holds that exigent circumstances justified warrantless seizures of funds being electronically transferred. (950) The government seized funds being electronically transferred by a Colombian drug cartel from United States banks to Colombian and Panamanian banks. The 2nd Circuit held that the warrantless seizures were justified by the exigent circumstances exception to the warrant requirement in the 4th Amendment. Circuit caselaw requires seizures made pursuant to 21 U.S.C. section 881(b)(4) to comport with the 4th Amendment. Thus, a warrantless seizure is valid only if it falls within one the recognized exceptions to the 4th Amendment. The court agreed that exigent circumstances were present: electronic transfers can be completed in a matter of minutes or hours, and the property at issue was fungible. The court also upheld those seizures made pursuant to an in rem warrant issued by a clerk of the court, pursuant to Supp. Rule C(3). Although the 4th Amendment requires probable cause at the time of seizure, the government need not obtain a judicial determination of probable cause before seizure. U.S. v. Daccarett, 6 F.3d 37 (2nd Cir. 1993).
2nd Circuit says probable cause only requires a nexus between seized property and illegal drug activity. (950) Under 2nd Circuit forfeiture caselaw, to establish probable cause, the government must have reasonable grounds to believe the property is subject to forfeiture, and these grounds must rise above the level of “mere suspicion.” Here, the 2nd Circuit noted that there was an apparent contradiction in formulations of how far above “mere suspicion” the probable cause burden lies. Although several cases have suggested that “a substantial connection” must be shown between the property and the illegal activity, the court found that “the weight of authority” in the 2nd Circuit requires the government only to demonstrate a “nexus” between the seized property and the illegal drug activity. To show that nexus when the res is a bank account, the government must establish that there is probable cause to believe the funds represent proceeds traceable to drug transactions; it is not required to link the monies to any one particular transaction. Here, the evidence was more than sufficient to link funds being electronically transferred to Colombia to illegal drug trafficking. U.S. v. Daccarett, 6 F.3d 37 (2nd Cir. 1993).
2nd Circuit finds that claimants knew of drug trafficking on their property. (950) The 2nd Circuit upheld the forfeiture of real property, finding that there was probable cause and that claimants were not innocent owners. Due to the extraordinary volume of drug transactions occurring on, nearby, or directly related to the premises (66 drug-related arrests over a three-year period), the trial court correctly found probable cause that the property had been used to facilitate drug trafficking. Further, the court did not err in rejecting claimants’ improbable testimony that they had no knowledge of drug-trafficking on their property and had not consented to it, particularly given their own drug-related arrests on the site and their presence during arrests for various other drug transactions. A claimant who has knowledge that his property is being used for drug-related purposes must take reasonable steps to prevent this illicit use in order to show a lack of consent. Claimants failed to show that they took those steps. That similar drug activity may have pervaded the neighborhood did not excuse them. U.S. v. All Right, Title, and Interest in Real Property and Appurtenances Thereto Known as 785 St. Nicholas Ave., 983 F.2d 396 (2nd Cir. 1993).
2nd Circuit remands to determine probable cause to forfeit bank accounts. (950) In a civil forfeiture action against real property and bank accounts, the district court ordered the forfeiture of the real property, but found that the government had not traced the money in the bank account to drug trafficking. The 2nd Circuit remanded because it was unclear whether the court had found (a) no probable cause to forfeit the accounts, or (b) that claimants had shown that the accounts did not contain drug proceeds. As the trial began, the judge announced that the probable cause requirement had been met by the government. The finding was not limited to the property, so the government presented no further evidence. The court’s later finding was contrary to this initial ruling. The case was remanded to determine whether probable cause existed for the forfeiture of the accounts. The court noted that on remand, probable cause could be based on circumstantial evidence and the funds need not be linked to specific drug transactions. U.S. v. All Right, Title, and Interest in Real Property and Appurtenances Thereto Known as 785 St. Nicholas Ave., 983 F.2d 396 (2nd Cir. 1993).
2nd Circuit rejects use of drug courier profile to establish probable cause for forfeiture. (950) Police discovered $31,990 in the trunk of a Gypsy cab. The 2nd Circuit affirmed that the government failed to demonstrate probable cause to seize the cash. At best, the amount of cash supported an inference of illegal activity, but not necessarily drug-related. The method of bundling the cash (rubber bands and plastic bags) might be probative of drug activity if there were other factors, but here there were none. The fact that the cab driver falsely told police that the money belonged to an unknown black male did not indicate drug trafficking. The parallels between the driver’s itinerary and that of a Dominican drug courier was not probative, since there was no evidence that the cab was used to transport drugs nor that the money was connected with narcotics. The driver’s possession of one-half gram of cocaine for personal use did not provide a strong inference that he was engaged in drug trafficking. All of these factors, taken together, established no more than a suspicion. U.S. v. $31,990, 982 F.2d 851 (2nd Cir. 1993).
3rd Circuit says affidavit raised issue of material fact that precluded summary judgment. (950) The government brought a civil forfeiture proceeding against claimant’s residence under 21 U.S.C. § 881(a)(7). Thereafter, claimant was convicted of drug charges but the jury could not agree on criminal forfeiture of the property. The government then filed a motion for summary judgment in the civil forfeiture action, relying on evidence that claimant stored cocaine on the property, and testimony from several individuals that they had purchased cocaine from claimant on the property. Claimant presented a sworn affidavit which stated that any cocaine hidden on the property was for his personal use and that the only time he distributed cocaine was when he traded it in a restaurant for some champagne. The 3rd Circuit held that claimant’s affidavit raised a genuine issue of material fact that precluded summary judgment. U.S. v. Premises Known as RR #1, Box 224, Dalton, 14 F.3d 864 (3rd Cir. 1994).
4th Circuit reverses summary judgment that property was related to criminal activity. (950) After claimant’s conviction for unlawfully prescribing drugs, the government sought to forfeit his property as proceeds of claimant’s illegal activity. The district court granted summary judgment in favor of the government, but the 4th Circuit reversed, finding no showing of a substantial connection between the property and claimant’s criminal activity. Though the government had asserted that claimant’s sole source of income was his tainted medical practice, that explanation did not connect claimant’s crimes to property that he acquired before his criminal activity. Even regarding other property, the court found the government’s “conclusory allegation” inadequate to support summary judgment in the absence of any indication of the “source or the basis” for the information. U.S. v. Borromeo, 995 F.2d 23 (4th Cir. 1993), added to in part and vacated in part, 1 F.3d 219 (4th Cir. 1993).
5th Circuit finds probable cause to forfeit vehicles with missing or altered VINs. (950) The government sought forfeiture of several vehicles under 18 U.S.C. § 512, which provides for the forfeiture of any motor vehicle or vehicle part whose vehicle identification number (VIN) has been tampered with or removed. The 5th Circuit held that the government established probable cause for the seizure and forfeiture of several vehicles. Each of the seized vehicles bore altered VINs. In addition, each had alterations that were inherently suspicious. Two trucks had VINs that had been ground off and restamped, two trucks contained engines and transmissions with VINs indicating that the parts had been stolen, and one truck had a VIN plate on the dash that was counterfeit. Finally, there was testimony that these vehicles were part of the inventory of a “salvage and chop shop” operation purportedly run by claimant. U.S. v. 1988 Chevrolet Silverado, 16 F.3d 660 (5th Cir. 1994).
5th Circuit says claimant has burden of proof once probable cause is established to seize car with missing VIN. (950) The government sought forfeiture of several vehicles under 18 U.S.C. § 512, which provides for the forfeiture of any motor vehicle or vehicle part whose vehicle identification number (VIN) has been tampered with or removed. The 5th Circuit held that once the government established probable cause for the forfeiture of a vehicle under § 512, the claimant bears the burden of proving a defense to the forfeiture. The plain language of section § 512 incorporates the burden of proof provision of section § 1615 of the “customs laws.” The court rejected defendant’s claim that the government had to establish that he knowingly tampered with or removed a VIN, or that he knew the vehicle was stolen. The attempt to incorporate a scienter requirement into the probable cause standard was simply an effort to subvert the burden-shifting approach approved here. U.S. v. 1988 Chevrolet Silverado, 16 F.3d 660 (5th Cir. 1994).
5th Circuit affirms that there was probable cause as to crime and forfeitability of property. (950) Defendant moved before trial for the return of approximately $75,000 in cash seized from him after he was arrested for attempting to purchase cocaine in a “reverse sting” operation. The district court referred the matter to a magistrate to conduct a hearing to determine probable cause as to both the commission of a narcotics offense and the forfeitability of the money. The 5th Circuit affirmed the magistrate’s determination that there was probable cause. Defendant had thousands of dollars in cash stored and packaged in exactly the same way, $20,000 of which he used to pay for the cocaine in the instant offense. He had no legitimate employment and admitted that he sold cocaine for years. The $42,000 seized from a warehouse was just over the amount defendant needed to complete the next phase of the drug deal he had discussed with the undercover agent. U.S. v. Ivy, 973 F.2d 1184 (5th Cir. 1992), abrogation on other grounds recognized by U.S. v. Fike, 82 F.3d 1315 (5th Cir. 1996).
5th Circuit says that mere possession of small quantity of cocaine would not support a forfeiture. (950) In a forfeiture action against claimant’s house, the government contended that the district court erroneously excluded claimant’s admission that marijuana and cocaine were in his house in 1986. The 5th Circuit found that the district court did not “exclude” the evidence of the 1986 drug possession, but rather considered it and then held that the drug possession could not be a basis for the forfeiture of the house. The appellate court agreed that the 1986 drug evidence could not compel a forfeiture, since mere possession of a controlled substance is punishable under 21 U.S.C. section 844 by imprisonment for less than a year. Absent inferences that the small amount of cocaine found meant that larger amounts were stored on the premises or that defendant distributed cocaine from his house, such possession would not support a section 881(a)(7) forfeiture. U.S. v. Land, Property Currently Recorded in the Name of Gerald Franklin Neff, 960 F.2d 561 (5th Cir. 1992).
6th Circuit holds criminal conviction inadequate to justify summary judgment of cash. (950) Claimant was convicted of drug offenses, and the government sought civil forfeiture of cash found in claimant’s home. The district court granted summary judgment to the government, but the 6th Circuit reversed. Although the money was introduced as evidence in claimant’s criminal trial, a finding that the money was proceeds or facilitating property was not “necessary and essential to the [criminal] judgment.” Claimant’s testimony in the criminal trial that the money represented a settlement from a black-lung claim created a genuine issue of material fact precluding summary judgment. U.S. v. Three Tracts of Property Located on Beaver Creek, 994 F.2d 287 (6th Cir. 1993).
6th Circuit relies on criminal convictions to preclude litigation of forfeitability of property. (950) Claimants had been convicted of growing marijuana on a 51-acre tract of land. The district court relied on the convictions in granting summary judgment of forfeiture of the property. The 6th Circuit noted that the fact of criminal conviction does not necessarily preclude litigation of a forfeiture action, but it affirmed reliance on the doctrine of collateral estoppel on the facts of this case. The owner of the property could not have been convicted had the criminal jury believed that she lacked knowledge and did not consent to her husband’s drug activities on the property, and her husband’s conviction also supported forfeiture of his dower interest in the property. U.S. v. Three Tracts of Property Located on Beaver Creek, 994 F.2d 287 (6th Cir. 1993).
6th Circuit finds no probable cause to forfeit money after positive dog reaction was excluded. (950) DEA agents questioned two outbound airport passengers who met certain characteristics of a drug courier. The passengers revealed they were carrying about $45,000 in their socks. The money was subjected to a dog sniff, and the dog reacted positively for drugs. The 6th Circuit affirmed the district court’s ruling that there was no probable cause to forfeit the money. When the agents told claimants that the money would be subjected to a dog sniff, a seizure occurred. Since there was no consent, no warrant, and no exception to the warrant requirement, the seizure was illegal. Thus, the dog’s reaction was the fruit of an illegal seizure. The remaining facts did not establish probable cause. Without the dog’s reaction, nothing showed a substantial connection between the cash and illegal drug activity. Judge Wellford dissented. U.S. v. Fifty-Three Thousand Eighty-Two Dollars in United States Currency, $53,082.00, 985 F.2d 245 (6th Cir. 1993).
6th Circuit rules that government established probable cause to forfeit cash carried by Miami-bound traveler. (950) The 6th Circuit reversed the district court’s determination that the government failed to establish probable cause to forfeit money seized from claimant at the airport. First, claimant had bought a one-way airline ticket to Miami, a well-known source city, acted nervous while checking his bag and arrived at the airport late. On the other hand, he did buy the ticket in advance with his own credit card, traveled under his own name, and checked luggage. Second, claimant was carrying a large amount of cash concealed on his person. On the other hand, the fact that the police officer could see cash protruding from his pocket suggested that claimant did little to conceal the money. Third, a drug-sniffing dog allegedly reacted positively to the money. But the government’s evidence on this point was weak. Fourth, claimant twice misstated to police officers the amount of money he was carrying, and misrepresented the source of the funds. Finally, a government agent testified that he had reason to believe that claimant had sold cocaine in the area. But because the agent refused to offer any basis for that belief, the court refused to attach any probative weight to that testimony. Nonetheless, despite the weaknesses of the government’s proof, the evidence did support a reasonable belief that the seized currency was substantially connected to illegal drug transactions. U.S. v. $67,220.00 in United States Currency, 957 F.2d 280 (6th Cir. 1992).
6th Circuit rules that probable cause determination is to be made on the basis of evidence available at forfeiture hearing. (950) The district court held that probable cause must be measured at the time of the seizure of the defendant property. The 6th Circuit noted that although this approach has been adopted by at least one other district court, it was following the 2nd Circuit in holding that a district court must assess probable cause at the time of the forfeiture hearing. “Of course a government cannot start a forfeiture proceeding in bad faith with wild allegations based on the hope that something will turn up to justify its suit. . . . Once a forfeiture proceeding is brought, if further evidence is legally obtained to justify the government’s belief, there is no persuasive reason to bar its use.” U.S. v. $67,220.00 in United States Currency, 957 F.2d 280 (6th Cir. 1992).
7th Circuit holds that claimant’s knowledge of currency reporting requirements is not an element of forfeiture. (950) Defendant, a Brazilian businessman, entered the U.S. from Brazil. He did not file a form reporting the importation of more than $10,000. One week later, he deposited $134,000 in two U.S. banks. The 7th Circuit affirmed that there was probable cause to forfeit the money. Knowledge of the reporting requirements was not an element of the offense. The government need show only that it has probable cause to believe that the claimant entered the country knowing that he was transporting more than $10,000 and that claimant did not report this fact on a Form 4790. The government presented sufficient evidence of this. U.S. v. $94,000 in United States Currency, 2 F.3d 778 (7th Cir. 1993).
7th Circuit refuses to allocate burden of proof differently for forfeitures based on currency reporting violations. (950) Generally, in a civil forfeiture case, the government’s initial burden is to establish probable cause to believe that the property is subject to forfeiture. After probable cause has been demonstrated, the burden shifts to the claimant to prove by a preponderance of the evidence that the property is not subject to forfeiture. The 7th Circuit rejected defendant’s invitation to change this allocation of the burden of proof for forfeitures based on currency reporting violations. The statute applicable to such forfeitures clearly provides for this allocation. The court rejected defendant’s claim that the punitive nature of civil forfeitures renders it more akin to a criminal than a civil proceeding. The reporting requirements are rational in light of the pervasive underground economy that avoids taxes, and forfeiture for violations of the currency reporting act is a reasonable method of ensuring enforcement of the currency declaration requirements. U.S. v. $94,000 in United States Currency, 2 F.3d 778 (7th Cir. 1993).
7th Circuit upholds forfeiture order based on 460 marijuana plants and gardening equipment at residence. (950) The 7th Circuit rejected claimant’s contention that the district court’s forfeiture order concerning his residence was not supported by the evidence. Claimant’s argument emphasized what the evidence did not show rather than what it did show. The government established probable cause that claimant’s property was used to facilitate the commission of a drug-related offense. The presence in defendant’s residence of 460 marijuana plants, together with “sophisticated” home gardening equipment and growing tools provided a reasonable ground for believing that claimant engaged in the intentional manufacture of marijuana, and that the plants were going to be trafficked. Since the government established probable cause, the burden shifted to claimant to refute the forfeitability by a preponderance of the evidence. Claimant failed to meet this burden. U.S. v. Certain Real Property, Commonly Known as 6250 Ledge Road, Egg Harbor, WI, 943 F.2d 721 (7th Cir. 1991).
8th Circuit finds that claimant did not voluntarily consent to seizure of cash at airport. (950) In a forfeiture proceeding against cash seized from claimant at the airport, the district court granted summary judgment in favor of the government. In granting summary judgment, the district court found that claimant voluntarily gave the currency to the police officer. The 8th Circuit reversed. Contrary to the district court’s findings, there was no admission by claimant that he voluntarily gave the officers the initial $2900 or the subsequent $4950 contained in the envelope. In fact, the record established the contrary. In the absence of a valid consent, the government must show probable cause to justify the seizure of the currency. Here there was none. Besides claimant’s somewhat suspicious behavior, the only evidence linking claimant to drugs was a report that he had a heroin supplier in Omaha. U.S. v. $7,850.00 in U.S. Currency, 7 F.3d 1355 (8th Cir. 1993).
8th Circuit rules that affidavit denying government’s claim did not rebut probable cause showing. (950) To show probable cause in support of the forfeiture of claimant’s automobile, the government presented a DEA agent’s affidavit describing claimant’s cocaine sales to undercover agents and included a confidential informant’s report that defendant used the car to retrieve cocaine from his stash. To rebut this probable cause showing, claimant offered an affidavit in which he denied using the car when dealing cocaine. The 8th Circuit affirmed the district court’s determination that defendant’s blanket denials were insufficient to rebut the government’s showing of probable cause to believe the car was forfeitable. The affidavit did not show that the car was not used in drug trafficking activities. Defendant did not dispute the government’s claim that he sold drugs to undercover officers or offer any explanation of how he traveled to and from his stash without using his car. U.S. v. One 1982 Chevrolet Corvette, 976 F.2d 392 (8th Cir. 1992).
8th Circuit upholds probable cause to forfeit cash seized from house identified by informants as location of drug transactions. (950) The 8th Circuit affirmed that there was probable cause to forfeit cash seized from claimants’ residence. At least two confidential informants identified the residence as a location for drug transactions. Police surveillance of the residence, coupled with prior activity on the block, revealed a high volume of traffic entering and leaving the residence. The money seized from the residence was wrapped in rubber bands, which a narcotics officer testified was characteristic of the way drug money is stored. Finally, two months after the search, a DEA agent purchased cocaine from one of the claimant’s daughters in front of the residence. The district court could properly reject claimants’ “inherently incredible” testimony. Judge Beam dissented, believing that a statute that permits an owner of noncontraband property to be divested of title by a mere showing of probable cause for the institution of forfeiture proceedings violates due process. U.S. v. Twelve Thousand, Three Hundred Ninety Dollars ($12,390.00), 956 F.2d 801 (8th Cir. 1992).
8th Circuit upholds use of facts outside initial complaint to establish probable cause. (950) The 8th Circuit upheld the district court’s decision to allow the government to introduce evidence of facts which were not alleged in the initial complaint to establish probable cause. The judge “took pains” to ensure that claimants were not confronted with any unfair or prejudicial information of which they were previously unaware. Such action was within the judge’s discretion. U.S. v. Twelve Thousand, Three Hundred Ninety Dollars ($12,390.00), 956 F.2d 801 (8th Cir. 1992).
10th Circuit affirms probable cause based on hidden currency and drug paraphernalia. (950) The 10th Circuit affirmed the district court’s determination that there was probable cause to forfeit cash found in claimant’s home and several vehicles owned by claimant. The unusually large amount of hidden currency ($149,442) and presence of drug paraphernalia, including packaging supplies and drug notations reflecting large drug transactions, established a sufficient nexus between the property and claimant’s involvement in drug trafficking. Claimant did not establish that the money was from legitimate sources. The vehicles were also properly subject to forfeiture. One contained a loaded pistol and a notebook containing drug notations, which indicated that it had been used to facilitate drug trafficking. Moreover, a sufficient nexus was established between the purchase of the vehicles with cash and claimant’s involvement in illegal drug transactions. Although the government did not tie the vehicles to a specific drug transaction, both were purchased with cash during the years when the district court found that claimants had failed to demonstrate legitimate alternate sources of income large enough to account for their cash expenditures. U.S. v. One Hundred Forty-Nine Thousand Four Hundred Forty-Two and 43/100 Dollars ($149,442.43), 965 F.2d 868 (10th Cir. 1992).
11th Circuit says wife not collaterally estopped by husband’s conviction from challenging probable cause. (950) Claimant’s husband was convicted of running an illegal gambling business from their home. In this forfeiture action, the district court held that the husband’s criminal conviction satisfied the government’s probable cause burden, and estopped the wife from arguing that the property was not used to facilitate a gambling operation. The 11th Circuit reversed, holding that the wife was not estopped by her husband’s criminal conviction from attacking the probable cause showing, since she did not have the opportunity to litigate her position in the criminal trial. She was not a party, her interests were not represented, and she was not in privity with a party, her husband. The district court’s conclusion that even absent collateral estoppel, probable cause had been established, was not supported by the record. The case was remanded for a determination of the disputed factual issues as to probable cause. U.S. v. One Single Family Residence Located at 18755 North Bay Road, Miami, 13 F.3d 1493 (11th Cir. 1994).
11th Circuit says large amount of currency, by itself, was not probable cause for forfeiture. (950) DEA agents seized $121,000 in cash from claimant as he was attempting to board an airplane. The district court held that a large amount of seized currency alone was sufficient to establish probable cause for the forfeiture of the money. The 11th Circuit rejected this conclusion, holding that a large amount of currency, by itself, is insufficient to establish probable cause for forfeiture under 21 U.S.C. §881(a)(6). However, summary judgment in favor of the government was affirmed, since under the totality of the circumstances, probable cause existed for the forfeiture. The manner in which defendant purchased his airline ticket and the nature of his travel itinerary made it unlikely that he was traveling on either business or vacation. When questioned by DEA agents, defendant appeared quite nervous. Finally, defendant had a history of narcotics arrests and convictions. U.S. v. $121,100.00 in United States Currency, 999 F.2d 1503 (11th Cir. 1993).
11th Circuit rules there was sufficient probable cause to support seizure of car. (950) In a forfeiture action brought under the customs law, 19 U.S.C. section 1595a, the 11th Circuit reversed the district court’s determination that there was no probable cause to seize claimant’s vehicle. The United States bears the same burden of proving probable cause in actions under the customs laws as it does in actions under 21 U.S.C. section 881. A car is considered directly involved in a drug transaction when it is used to transport an individual to the place where a drug transaction takes place even though it is not used to transport money or drugs. Here, there was evidence that plaintiff used the car to transport a co-conspirator and cash to the airport to catch a flight to the Philippines, where the co-conspirator would use the cash to obtain heroin and then smuggle it back into the United States. This alone was sufficient to find probable cause. Nnadi v. Richter, 976 F.2d 682 (11th Cir. 1992).
11th Circuit, en banc, reverses summary judgment in favor of claimant in forfeiture action against a dozer. (950) In an en banc decision the 11th Circuit reversed a summary judgment in favor of claimant in a forfeiture action against a dozer. The government showed that a convicted drug dealer with no legal means of support purchased the dozer with $65,000 in cash. The drug dealer used the dozer for his own purposes, kept it on his property, and led others to believe that it was his. Claimant rebutted this showing with testimony that a dealer had purchased the dozer on claimant’s behalf for claimant’s logging business, that the dozer was depreciated by the logging business in its state and federal income tax returns, and that claimant permitted the dealer to use the dozer for his own purposes because the dealer operated the dozer in claimant’s logging business without compensation. However, there were internal inconsistencies with claimant’s story and a jury could choose to disbelieve the explanation. The uncontested facts reasonably suggested that the dealer bought the dozer with the proceeds of drug transactions. Whether claimant’s explanation should be believed was a question for the jury, not the district court. Several judges dissented, finding the government failed to produce sufficient evidence. U.S. v. Four Parcels of Real Property in Greene and Tuscaloosa Counties, 941 F.2d 1428 (11th Cir. 1991) (en banc).