United States v. $45,000.00 in U.S. Currency
| Decision Date | 26 September 2013 |
| Docket Number | CIVIL ACTION NO. 2:12-CV-181-KS-MTP |
| Parties | UNITED STATES OF AMERICA PLAINTIFF v. $45,000.00 IN U.S. CURRENCY DEFENDANT PROPERTY |
| Court | U.S. District Court — Southern District of Mississippi |
This matter is before the Court on the Plaintiff United States of America's (the "Government") Motion for Summary Judgment [22]. Having considered the motion, the response, the record and the applicable law, the Court finds that the Government's request for summary judgment should be denied.
This is an asset forfeiture proceeding in which the Government seeks $45,000.00 in U.S. currency seized from Kevin Charles Lawrence. On October 12, 2012, the Government filed its Verified Complaint for Forfeiture in Rem (the "Complaint") [1] in this Court. Subject matter jurisdiction is asserted under Title 28 U.S.C. §§ 1345 (United States as plaintiff) and 1355 (recovery or enforcement of any fine, penalty or forfeiture). The Complaint asserts that the $45,000.00 is subject to forfeiture pursuant to 21 U.S.C. §§ 881(a)(6) and (h) of the Controlled Substances Act. Subsection (a)(6) renders the following property subject to forfeiture:
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.
21 U.S.C. § 881(a)(6). Subsection (h) specifies that the title to forfeited property vests "in the United States upon commission of the act giving rise to forfeiture under this section." 21 U.S.C. § 881(h).1
The factual bases underlying the Complaint [1] are detailed in the attached Affidavit in Support of Forfeiture ("ASF") [1-1] executed by Task Force Agent Daniel Davis. Agent Davis is a narcotics investigator employed by the Bay St. Louis, Mississippi Police Department. He is also a Task Force Agent with the Drug Enforcement Administration ("DEA") in Gulfport, Mississippi. (See ASF [1-1] at ¶ 1.) On May 21, 2012, a Confidential Source ("CS") advised DEA agents in Gulfport that Kevin Charles Lawrence utilized his trucking company, KNP Trucking, LLC ("KNP"), to transport marijuana from the State of Texas to Hattiesburg. (See ASF [1-1] at ¶ 2.) The CS also informed the agents that Lawrence transported an undetermined amount of U.S. currency, which had been unloaded from a KNP truck along with several 55 gallon barrels of marijuana, to South Pine Mini Storage at 5423 U.S. Highway 49, Hattiesburg, Mississippi. (See ASF [1-1] at ¶ 2.) Also on May 21, the DEA agents learned that Lawrence rented storage unit #179 at South Pine Mini Storage, and officers from the Hattiesburg Police Department ("HPD") obtained a search warrant to search this unit. (See ASF [1-1] at ¶¶ 3-4.) On May 22, DEA agents and HPD officers searched unit#179 at South Pine Mini Storage and found a safe containing $45,000.00 in U.S. currency wrapped in a Dillard's shopping bag. (See ASF [1-1] at ¶ 5.)
On November 27, 2012, Lawrence filed a Verified Claim of Ownership [5] in this action, stating that he maintained a full ownership interest in the subject $45,000.00. On December 14, 2012, Lawrence filed his Answer [6] to the Complaint [1], denying that the $45,000.00 is subject to forfeiture and requesting the return of the currency to him together with interest.
On August 9, 2013, the Government filed its Motion for Summary Judgment [22]. The Government contends that it is entitled to summary judgment because the $45,000.00 is subject to forfeiture pursuant to 21 U.S.C. § 881 for violations of 21 U.S.C. §§ 841 and 846,2 and because Lawrence cannot show that he is an "innocent owner" of the currency under 18 U.S.C. § 983(d)(1). Lawrence opposes the Government's motion. (See Doc. Nos. [26], [27].) The Court has fully considered the parties' positions and is ready to rule.
Federal Rule of Civil Procedure 56 provides that "[t]he court shall grant summary judgment if the movant shows that 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(a). Initially, the movant has "the burden of demonstrating the absence of a genuine issue ofmaterial fact." Cannata v. Catholic Diocese of Austin, 700 F.3d 169, 172 (5th Cir. 2012) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986)). If the movant meets this burden, the nonmovant must go beyond the pleadings and point out specific facts showing the existence of a genuine issue for trial. Id. "'An issue is material if its resolution could affect the outcome of the action.'" Sierra Club, Inc. v. Sandy Creek Energy Assocs., L.P., 627 F.3d 134, 138 (5th Cir. 2010) (quoting Daniels v. City of Arlington, Tex., 246 F.3d 500, 502 (5th Cir. 2001)). "An issue is 'genuine' if the evidence is sufficient for a reasonable jury to return a verdict for the nonmoving party." Cuadra v. Houston Indep. Sch. Dist., 626 F.3d 808, 812 (5th Cir. 2010) (citation omitted).
The Court is not permitted to make credibility determinations or weigh the evidence. Deville v. Marcantel, 567 F.3d 156, 164 (5th Cir. 2009) (citing Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007)). When deciding whether a genuine fact issue exists, "the court must view the facts and the inferences to be drawn therefrom in the light most favorable to the nonmoving party." Sierra Club, Inc., 627 F.3d at 138. However, "[c]onclusional allegations and denials, speculation, improbable inferences, unsubstantiated assertions, and legalistic argumentation do not adequately substitute for specific facts showing a genuine issue for trial." Oliver v. Scott, 276 F.3d 736, 744 (5th Cir. 2002) (citation omitted). Summary judgment is mandatory "'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.'" Brown v. Offshore Specialty Fabricators, Inc., 663 F.3d759, 766 (5th Cir. 2011) (quoting Celotex Corp., 477 U.S. at 322), cert. denied, 132 S. Ct. 2103 (2012).
The Civil Asset Forfeiture Reform Act of 2000 ("CAFRA"), Pub. L. No. 106-185, 114 Stat. 202, governs civil forfeiture proceedings in federal courts. Under CAFRA, the Government must "establish, by a preponderance of the evidence, that the property is subject to forfeiture . . . ." 18 U.S.C. § 983(c)(1).3 Where "the Government's 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 shall establish that there was a substantial connection between the property and the offense." 18 U.S.C. § 983(c)(3). Circumstantial evidence may be utilized by the Government to prove this connection. See United States v. $84,615 in U.S. Currency, 379 F.3d 496, 501 (8th Cir. 2004) (citing United States v. $10,700.00 in U.S. Currency, 258 F.3d 215, 224 n.6 (3d Cir. 2001)). Also, the Government is not required to establish a link between the currency and a specific drug transaction if forfeiture is sought pursuant to 21 U.S.C. § 881(a)(6). See United States v. $11,500.00 in U.S. Currency, 710 F.3d 1006, 1013 (9th Cir. 2013) (). Post CAFRA, the Government may not rely on hearsayevidence in obtaining forfeiture and any affidavit submitted by either party must be based upon personal knowledge. See $92,203.00 in U.S. Currency, 537 F.3d at 510.
If the Government meets its burden, the claimant must then prove by a preponderance of the evidence that he is an innocent owner. See id. at 509. "An innocent owner's interest in property shall not be forfeited under any civil forfeiture statute." 18 U.S.C. § 983(d)(1). As to property interests existing at the time the conduct giving rise to forfeiture took place, an "innocent owner" is one who either "(i) did not know of the conduct giving rise to forfeiture; or (ii) 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).4
The Government asserts that there are no genuine issues of material fact and that it is entitled to judgment as a matter of law on the following two issues: (1) there is a substantial connection between the subject $45,000.00 and illegal drug activity, allowing for forfeiture pursuant to 21 U.S.C. § 881; and (2) Lawrence cannot establish that he is an "innocent owner" of the $45,000.00. The Court finds that issues for trial exist with respect to the connection between the $45,000.00 and narcotics activity. Thus, no discussion of Lawrence's "innocent owner" defense is necessary.
The Government offers three bases for a substantial connection between the $45,000.00 and illegal drug activity. First, the Government contends that "Lawrence'slong history of involvement with illegal narcotics is highly probative of the Defendant Currency's connection to illegal drug activity." (Mem. of Auths. in Supp. of Mot. for SJ [23] at p. 6.) A claimant's record of involvement with illegal narcotics is a relevant consideration in determining whether the Government has made its case for forfeiture. See, e.g., United States v. Cunningham, No. 12-3778, 2013 WL 1405207, at *2 (6th Cir. Apr. 9, 2013); United States v. $147,900.00 in U.S. Currency, 450 Fed. Appx. 261, 264 (4th Cir. 2011); United States v. 90-23 201st St., Hollis, N.Y., 775 F. Supp. 2d 545, 564 (E.D.N.Y. 2011). In ...
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