U.S. v. D.K.G. Appaloosas, Inc.

• Decision Date: 29 September 1987
• Docket Number: O,TWO-DOO,Nos. 86-2199,86-2605,s. 86-2199
• Citation: 829 F.2d 532
• Parties: , 9 Fed.R.Serv.3d 83 UNITED STATES of America, Plaintiff-Appellant, Cross-Appellee, v. D.K.G. APPALOOSAS, INC., et al., Defendants-Appellees, Bruce Emery Griffin, Claimant-Appellee, Cross-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. ONE 1984 LINCOLN MARK VIIne 1981 Silver Spirit Rolls Royce, et al., Defendants, Bruce Emery Griffin, Claimant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 532

829 F.2d 532

56 USLW 2263, 9 Fed.R.Serv.3d 83

UNITED STATES of America, Plaintiff-Appellant, Cross-Appellee, v. D.K.G. APPALOOSAS, INC., et al., Defendants-Appellees, Bruce Emery Griffin, Claimant-Appellee, Cross-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. ONE 1984 LINCOLN MARK VII TWO-DOOR, One 1981 Silver Spirit

Rolls Royce, et al., Defendants,

Bruce Emery Griffin, Claimant-Appellant.

Nos. 86-2199, 86-2605.

United States Court of Appeals Fifth Circuit.

Sept. 29, 1987.

Gerald H. Goldstein, San Antonio, Tex., Joseph C. Hawthorn, Beaumont, Tex., for plaintiff-appellant, cross-appellee.

Sara Criscitelli, Atty., U.S. Dept. of Justice, Washington, D.C., Bob Wortham, U.S. Atty., Beaumont, Tex., for defendants-appellees.

Appeals from the United States District Court for the Eastern District of Texas.

Before CLARK, Chief Judge, RANDALL, and DAVIS, Circuit Judges.

RANDALL, Circuit Judge:

The government appeals the district court's entry of judgment against the government in its suit to forfeit claimant's horse ranch in East Texas, and claimant cross-appeals the district court's allocation of the costs of operating the ranch while the forfeiture litigation was pending. In a consolidated appeal, claimant also challenges, as a violation of the ex post facto clause of the United States Constitution, the district court's judgment forfeiting to the government certain gold bars owned by claimant. Finally, claimant attacks the district court's refusal to give a jury charge claimant proposed in the consolidated action. We affirm the judgments entered by the district court.

I.

As the facts and proceedings below are set out in great detail in the district court's careful opinion, we recite here only those facts necessary to our disposition of this appeal. See United States v. D.K.G. Appaloosas, Inc., 630 F.Supp. 1540, 1546-51 (E.D.Tex.1986) (describing as a "procedural nightmare" the attempted forfeiture of the ranch). In 1983, claimant Bruce Emery Griffin ("Griffin") pled guilty to two counts of conspiracy to possess with intent to distribute marijuana, a violation of 21 U.S.C. Sec. 846. The plea was entered pursuant to a "pre-plea agreement" between the government and Griffin. Under the agreement, Griffin was to testify against his co-defendants and "cooperate" with the government's investigation of illegal drug trafficking activities. In return, the government agreed to stand mute at Griffin's sentencing except to inform the court of Griffin's cooperation, and to recommend that any term of imprisonment he received be concurrent with the term imposed for a separate tax conviction. Most importantly for purposes of this appeal, however, the government also agreed in the pre-plea agreement that:

The United States will not prosecute the Defendant or otherwise seek to impose any criminal or civil sanctions against the Defendant for any act or conduct known to the United States Attorney and committed in the Southern District of Florida prior to the date of this Pre-Plea Agreement except as set out in this Agreement. Further, neither the United States nor any of its agents or employees will encourage any foreign, state, or local law enforcement authority in imposing or attempting to impose any criminal or civil sanctions or liability upon the Defendant for any acts or offense occurring prior to the date of this Agreement.

The sentencing judge, the Honorable William M. Hoeveler of the United States District Court for the Southern District of Florida, accepted the plea and sentenced Griffin to three years' imprisonment.

In March of 1984, the government filed a civil, in rem complaint in the United States District Court for the Eastern District of Texas, seeking forfeiture of specific real property--the D.K.G. Ranch--and a number of chattels, including a herd of horses and money in two bank accounts. The complaint alleged that the properties against which the action was brought were the proceeds of illegal drug traffic, and were therefore subject to forfeiture under 21 U.S.C. Sec. 881. The properties were ostensibly owned by either NABUC, Ltd., a Bahamian corporation, or D.K.G. Appaloosas, Inc., a Texas corporation wholly owned by NABUC, Ltd. The government, however, suspected that Griffin, as the owner of both companies, was the true owner of the properties; nevertheless, it failed to disclose the existence of the pre-plea agreement in its complaint. The complaint was assigned to the Honorable William M. Steger. As the presiding judge, Judge Steger found that probable cause for the seizure existed, and authorized the government to act. Within two weeks of the seizure, Griffin and others filed claims to the properties seized.

On April 23, 1984, Griffin's attorneys informally brought the existence of the pre-plea agreement to Judge Steger's attention. In August of 1984, Griffin filed an "In camera Motion for Specific Performance of Pre-Plea Agreement" in the United States District Court for the Southern District of Florida, seeking a declaration from Judge Hoeveler that the pre-plea agreement barred the forfeiture of the ranch. Shortly thereafter, Griffin moved in Judge Steger's Texas court to change venue of the forfeiture action to Florida.

Judge Steger reviewed the motion to transfer venue, and concluded that while the pre-plea agreement was the key to resolving the forfeiture action, the agreement itself created two separate problems. First, since the scope of the government's promise not to seek criminal or civil sanctions was unclear, the agreement had to be interpreted to determine whether it prevented the forfeiture. Second, since it was also unclear who actually owned the properties seized, the ownership issue had to be resolved before it could be determined whether the agreement even applied to those properties. With respect to the meaning of the agreement, Judge Steger, the government, and Griffin all concluded that Judge Hoeveler as the sentencing judge was in a better position to determine the parties' intent. However, the Texas court, in Judge Steger's opinion, was the proper forum for resolution of the ownership question, since that question related specifically to property located in Texas. Consequently, Judge Steger denied the motion to transfer venue. Instead, he proceeded to administer the forfeiture proceeding on the ownership issue while awaiting Judge Hoeveler's interpretation in the Florida proceeding of the scope of the agreement. As Judge Steger explained, "Beginning in September of 1984, this Court hoped for a quick decision from Florida interpreting the plea agreement since so many other issues seemed to hinge on that one." 630 F.Supp. at 1549.

By December of 1984, however, Judge Hoeveler had still not issued a definitive interpretation of the pre-plea agreement. Concerned by the lack of real progress in the case, Judge Steger resolved to set the matter for trial. A week before the trial date, however, the government--in a motion soon joined by Griffin--moved to continue the trial until Judge Hoeveler interpreted the pre-plea agreement. Judge Steger "reluctantly agreed, and continued the matter until a date twenty-one days after the parties received a dispositive ruling from the court in Florida." Id. at 1549.

In August of 1985, Judge Hoeveler orally announced a provisional ruling. In the ruling, Judge Hoeveler indicated that he would specifically enforce the pre-plea agreement, and concluded that "[a]ny property owned by Bruce Emery Griffin and known to the United States Attorney at the time of the pre-plea agreement was protected from forfeiture." Id. at 1550. Unfortunately, no written order confirming the provisional ruling was soon forthcoming. Judge Steger, however, determined that even if Judge Hoeveler adhered to his provisional ruling when finally reducing it to writing, a trial would still be necessary to determine whether the ranch and related properties were owned by Griffin or by Griffin's companies. Moreover, a finding that the corporations owned the ranch would--in Judge Steger's view--deprive Griffin of standing to contest the forfeiture; in addition, because the pre-plea agreement only extended to Griffin individually, it would deprive the corporations of standing to assert the plea bargain. Trial on the ownership issue, therefore, was held in November of 1985. The jury returned a verdict finding that Griffin and his wife owned all of the seized property. Consequently, the scope of the plea agreement again became the critical point of the dispute. Since Judge Hoeveler still had not finalized his provisional ruling, however Judge Steger hesitated to enter judgment on the verdict.

On December 5, 1985, Judge Steger was notified that Judge Hoeveler had signed a final order upholding the pre-plea agreement. The order made clear that all property owned by Griffin and known to the United States Attorney at the time of the plea was protected by the pre-plea agreement. Furthermore, it specifically found that the United States Attorney had known about the ranch when the agreement was made and, therefore, that the ranch was a part of the plea agreement understanding. With respect to other properties which were seized after being found on the ranch, Judge Hoeveler's order was also clear: "If, as in the case of the ranch, the Government was aware of such property, then that property would fall in the same category and be subject to the same proscriptions as the ranch."

After learning of Judge Hoeveler's order, Judge Steger took two actions. First, Judge Steger entered judgment, based on the jury verdict and Judge Hoeveler's order, permitting Griffin to reclaim the ranch and other property--including the horses and equipment--that comprised the D.K.G. Ranch forfeiture. Judge Hoeveler's order, however, left unresolved the question of whether the government knew about certain automobiles, gold, and jewelry found on the ranch after it was seized; consequently,...