799 F.2d 1357 (9th Cir. 1986), 85-1976, United States v. 5,644,540.00 in United States Currency

Docket Nº:85-1976, 85-2069, 85-2075, 85-2084 and 85-2085.
Citation:799 F.2d 1357
Party Name:UNITED STATES of America, Plaintiff-Appellee, v. $5,644,540.00 IN U.S. CURRENCY, 450 One-Ounce Gold Canadian Maple Leaf Coins, 500 One-Ounce Platinum Ingots, Defendants, and Kenneth Cory, Controller, etc., California Franchise Tax Board, Ann Smith Kamali, Nelson Garrett, Douglas Stavoe, and Pearl Lampros, Claimants- Appellants.
Case Date:September 16, 1986
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 1357

799 F.2d 1357 (9th Cir. 1986)

UNITED STATES of America, Plaintiff-Appellee,

v.

$5,644,540.00 IN U.S. CURRENCY, 450 One-Ounce Gold Canadian

Maple Leaf Coins, 500 One-Ounce Platinum Ingots, Defendants,

and

Kenneth Cory, Controller, etc., California Franchise Tax

Board, Ann Smith Kamali, Nelson Garrett, Douglas

Stavoe, and Pearl Lampros, Claimants- Appellants.

Nos. 85-1976, 85-2069, 85-2075, 85-2084 and 85-2085.

United States Court of Appeals, Ninth Circuit

September 16, 1986

Argued and Submitted June 13, 1986.

Page 1358

Sanford Svetcov, Dennis Michael Nerney, Asst. U.S. Attys., San Francisco, Cal., for plaintiff-appellee.

Robert E. Murphy, Deputy Atty. Gen., San Francisco, Cal., for defendants and Cory.

Frederick P. Furth, Thomas R. Fahrner, Michele C. Jackson, Dwayne L. Abbott, Furth, Fahrner, Bluemle & Mason, San Francisco, Cal., for claimants-appellants Kamali and Garrett.

Philip Farley, Franchise Tax Bd., Sacramento, Cal., for claimants-appellants.

John H. Boone, San Francisco, Cal., for claimant-appellant Stavoe.

Law Offices of Melvin M. Belli, Sr., Constance R. Fraenkel, Paul M. Monzione, Philip

Page 1359

L. Stimac, San Francisco, Cal., for Lampros.

Appeal from the United States District Court for the Northern District of California.

Before ALARCON and WIGGINS, Circuit Judges, and STEPHENS [*], Senior District Judge.

STEPHENS, Senior District Judge:

The claimants of the res consisting of $5,644,540.00 in U.S. currency, 450 one-ounce gold coins, and 500 one-ounce platinum ingots appeal from a summary judgment forfeiting the property to the government. We affirm.

I. FACTS

Claimants Ann Smith Kamali and Nelson Garrett were supervisory employees of Budget Rent-A-Car at its San Francisco airport office. In early October 1984, Kamali commenced a search for a 1984 white Ford Tempo automobile, which was considered missing from Budget's inventory although the extended rental contract had an expiration date of October 22, 1984. A deputy sheriff had told Kamali that he had seen the car in an airport parking lot.

On October 10, 1984, Kamali asked Garrett to look in the airport parking lot for the car, but he was unable to find it. On October 23, 1984, Kamali again requested that Garrett look for the car. He located it in the parking lot and tried to start the car after obtaining the keys, but was unable to do so. He returned to Budget's office, and then he and Kamali drove another car to the parking lot to retrieve the Ford Tempo. They were able to start the Ford and drove both cars back to the Budget office.

Kamali attempted to contact the individual who had rented the car by dialing the phone numbers listed on the rental documents. She reached an answering service and a Marin County motel, but was unable to reach the renter. On that same afternoon, she drove the Ford Tempo to lunch. As she was leaving the Budget parking lot, she stopped to go through a routine security check. Security Guard Pearl Lampros, who is another claimant, opened the trunk, and they both saw luggage and other packaged items in it.

Kamali returned from lunch in the same car and drove to the back door of the Budget office in order to unload the contents of the trunk. Because the luggage was very heavy, she requested Garrett's help. The trunk contained, among other things, two unlocked duffel bags, two locked, vinyl suitcases, and a cardboard box. Kamali opened one of the duffel bags and discovered that it was filled with U.S. currency. Kamali and Garrett then opened the other duffel bag which also contained U.S. currency. The cardboard box contained gold coins and platinum bars.

Kamali contacted the San Mateo Sheriff's office, and two detectives arrived at the Budget office shortly thereafter. The detectives took custody of all of the contents of the trunk of the Ford Tempo. After reviewing the situation, the sheriff's detectives contacted the Drug Enforcement Administration (DEA), and two agents arrived later and seized and removed all of the property pursuant to 21 U.S.C. section 881(a)(6).

The next day, October 24, 1984, one of the DEA agents, Fiorentino, presented an affidavit for a search warrant to a federal magistrate who issued a warrant authorizing Fiorentino to search the two locked suitcases, which had been found in the trunk. The affidavit recited that DEA agents had counted approximately $1.4 million in $50 and $100 bills in the two duffel bags and that the gold coins and platinum ingots found were valued in excess of $600,000. A previously reliable dog trained to identify narcotics "alerted" on both of the suitcases found in the car, each of which had been placed in line with other

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pieces of luggage. The missing car had been rented by a person giving his address as Miami, Florida, a known source city for cocaine. The renter's local residence proved to be a Marin County motel which DEA agents knew had been used in the past for drug trafficking. The renter had not been registered there for five months. The car had been rented on August 9, 1984, was renewed twice by telephone, and the rental contract was to expire on October 22, 1984.

The two suitcases were opened and searched pursuant to the warrant on October 24, 1984. One suitcase contained 100 pounds of $100 bills, amounting to $4 million, and the other contained three shopping bags of currency in $100, $50, $20 and $10 denominations, totalling $245,540. When the suitcase containing the shopping bags was opened, the agents detected the odor of processed cocaine, and after removing the money, they saw flakes of white powder in the top and bottom sections of the liner. A DEA chemist confirmed that the substance was cocaine; fifteen milligrams were recovered from the suitcase.

After further investigation, DEA agents discovered that the person who rented the car on August 9, 1984, had used a fraudulent Florida driver's license and gave a false name and address in Miami. The occupant of the residence address given in Miami did not know the individual who had rented the car, but had returned mail that had been addressed to him at the house to the post office.

The suspect had opened a mail and telephone answering service in Marin County on January 1, 1984, listing a Delaware corporation as his business address and using another identity. The corporation's address turned out to be a vacant lot in San Antonio, Texas. The suspect also used a false social security number to obtain a Visa credit card. His Visa records disclosed that he had travelled by car from Miami to the Atlanta airport for a flight to the West Coast. This was consistent with the practice of cocaine dealers seeking to avoid the high level of police supervision at the Miami airport.

The suspect, using yet another false name, traded 500 gold coins for 500 platinum ingots at a coin shop in southern California on July 5, 1984. The coin dealer identified a photograph of the suspect obtained from the fraudulent Florida driver's license. The identity of the suspect became known to...

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