United States v. Abhishek Krishnan's Real & Personal Prop.
| Decision Date | 29 June 2020 |
| Docket Number | NO. 5:19-CV-441-FL,5:19-CV-441-FL |
| Citation | 469 F.Supp.3d 481 |
| Court | U.S. District Court — Eastern District of North Carolina |
| Parties | UNITED STATES of America, Plaintiff, v. ABHISHEK KRISHNAN'S REAL AND PERSONAL PROPERTY Specifically Described as: U.S. Currency in the Amount of $1,441,813.42 Formerly Held in TD Ameritrade Account *3860; U.S. Currency in the Amount of $1,225,778.30 Formerly Held in Bank of America Account *3846; U.S. Currency in the Amount of $3,140.91 Formerly Held in Bank of America Account *4234; Real Property Described in Deed Book 015780, Pages 01126-01128 of the Wake County Registry, Having the Street Address of 1421 Ballyclare Court, Raleigh, NC; Real Property Described in Deed Book 017211, Pages 01862-01863 of the Wake County Registry, Having the Street Address of 2736 Laurel Cherry Street, Raleigh, NC; Real Property Described in Deed Book 015037, Page 01218 of the Wake County Registry, Having the Street Address of 6205 Cold Water Court, Raleigh, NC; and any and all proceeds From the Sale of Said Properties, Defendants. Bank of America, NA; Wake County Department of Tax Administration; Abhishek Krishnan; American Pure Whey, LLC; US Trade and Exchange, LLC, Claimants. |
John E. Harris, United States Attorney's Office - EDNC, 150 Fayetteville Street, Suite 2100, Raleigh, NC 27601, 919-856-4048, Fax: 919-856-4821, Email: John.Harris5@usdoj.gov, for Plaintiff.
Claire Collins Dickerhoff, Hutchens Law Firm, 4317 Ramsey St., Fayetteville, NC 28311, 910-864-6888, Fax: 910-864-6848, Email: claire.collins@hskplaw.com, for Defendant Real Property Described in Deed Book 015780, Pages 01126-01128 of the Wake County Registry, Having the Street Address of 1421 Ballyclare Court, Raleigh, NC.
Claire Collins Dickerhoff, Hutchens Law Firm, 4317 Ramsey St., Fayetteville, NC 28311, 910-864-6888, Fax: 910-864-6848, Email: claire.collins@hskplaw.com, for Claimant Bank of America, NA.
Kenneth R. Murphy, III, Wake County Attorney's Office, Post Office Box 550, Raleigh, NC 27602, 919-856-5506, Fax: 919-783-9650, Email: Kenneth.Murphy@wakegov.com, for Claimant Wake County Department of Tax Administration.
Collin P. Cook, Elliot Sol Abrams, Cheshire Parker Schneider, PLLC, Post Office Box 1029, 133 Fayetteville Street, Suite 500, Raleigh, NC 27602, 919-833-3114, Fax: 919-832-0739, Email: elliot.abrams@cheshirepark.com, for Claimants Abhishek Krishnan, US Trade and Exchange, LLC.
This matter is before the court upon motion (DE 33) by claimants Abhishek Krishnan ("Krishnan"), American Pure Whey, LLC ("APW"), and US Trade and Exchange, LLC ("US T&E") (collectively "claimants"),1 to stay civil forfeiture proceedings and to extend time to respond to the complaint. Also before the court is motion (DE 37) by the United States of America (the "government") to strike claims of claimants. The motions have been fully briefed, and the issues raised are ripe for ruling. For the following reasons, the motions are granted in part and denied in part as set forth herein.
The government commenced this civil forfeiture action on October 4, 2019, against real and personal property of claimant Krishnan, who is a defendant in criminal case No. 5:19-CR-299-FL-1 (the "criminal case"). In the criminal case, the government filed indictment on July 31, 2019, and superseding indictment on August 28, 2019, asserting 43 felony counts against claimant Krishnan for mail fraud (counts 1-8), introduction of adulterated foods into interstate commerce (counts 9-32), and money laundering (counts 33-43). A warrant for claimant Krishnan's arrest was issued July 31, 2019, and remains unserved, resides in India.
By way of summary, the indictment2 charges that claimant Krishnan, through his company claimant American Pure Whey, LLC ("APW"), defrauded consumers by: 1) making false and fraudulent representations as to the quality of APW's manufacturing facility and processes taking place in New Bern, North Carolina, and the true contents and quality of APW's whey protein powders sold as a dietary supplement to consumers; and 2) creating and causing to be created fictitious laboratory analysis to falsely certify the contents of APW's whey protein powder. The indictment further charges that claimant Krishnan opened business bank accounts in the name of claimant APW and claimant U.S. Trade and Exchange, LLC ("U.S. T&E"), over which he had sole signatory authority, including TD Ameritrade Account No. *3860 (the "TD Ameritrade Account"), and Bank of America Account Nos. *3846 and *4234, in order to engage in monetary transactions involving criminally derived property from his mail fraud scheme.
In the instant forfeiture complaint, the government seeks forfeiture under: 1) 18 U.S.C. § 981(a)(1)(C) of property constituting or derived from proceeds traceable to an offense constituting a specified unlawful activity as defined in 18 U.S.C. § 1956(c)(7), and 2) 18 U.S.C. § 981(a)(1)(A) of property involved in a money laundering transaction or attempted money laundering transaction, or property traceable thereto. Defendant property comprises the following seized U.S. currency and three tracts of real property titled in the name of claimant Krishnan:
The alleged facts and circumstances supporting the seizure and forfeiture of the defendant properties are contained in a declaration of United States Food and Drug Administration ("FDA") special agent Paul Pierce ("Pierce"), and the superseding indictment in the criminal case, attached to the complaint in the instant matter.
As pertinent to the instant motions, on December 2, 2019, claimant Krishnan filed a claim of interest, as owner of all the defendant property; claimant APW filed a claim of interest, as owner of currency formerly held in Bank America Account Nos. *3846 and *4234; and claimant T&E filed a claim of interest, as owner, of currency formerly held in the TD Ameritrade Account.3
On February 19, 2020, claimants filed the instant motion to stay the instant civil forfeiture case, and for an order extending the time to respond to the complaint, pursuant to the Fifth Amendment to the United States Constitution, 18 U.S.C. § 981(g)(2), and Federal Rule of Civil Procedure 6(b)(1)(A), on the basis that claimant Krishnan is subject to indictment in the related criminal case.
The government filed the instant motion to strike claimants' claims on March 23, 2020, pursuant to the fugitive-disentitlement statute, 28 U.S.C. § 2466, on the basis that claimant Krishnan, who filed claims on behalf of himself and other claimants, knows that a warrant has been issued for his arrest, has declined to return to the United States or otherwise continues to evade jurisdiction in order to avoid criminal prosecution, and is not held in custody in any other jurisdiction. In support of the motion, the government relies upon 1) an October 30, 2019, email from paralegal Del Washington to claimant Krishnan, and 2) December 10, 2019, correspondence from counsel for claimant Krishnan and Assistant United States Attorney Susan Menzer ("Menzer"). That same date, the government filed a response in opposition to claimants' motion to stay.
Claimants responded in opposition to the motion to strike on April 23, 2020, relying upon 1) a schedule of "Untainted and Allegedly Tainted Deposits into [the] TD Ameritrade Account," 2) correspondence between Menzer and counsel for claimant Krishnan, and 3) a declaration of claimant Krishnan.
The government replied in support of its motion to strike on May 14, 2020, relying upon 1) email correspondence between counsel for claimant and counsel for the government, 2) declaration of Clemens Meyers ("Meyers"), a law enforcement consultant, and 3) an email from Owen White, owner of Real Property Management. With leave of court, claimants filed a surreply on May 19, 2020.
The government seeks to strike all claims by claimants on the basis of fugitive disentitlement. On the same basis, the government argues that if claimants are disallowed from pursing a claim, their motion to stay pending resolution of the criminal case must be denied. Because, fugitive disentitlement is a threshold issue impacting both motions, the court addresses first its application under the circumstances of the case.
This rule in § 2466(a) "may be applied to a claim filed by a corporation if any majority shareholder, or individual filing the claim on behalf of the corporation is a person to whom subsection (a) applies." 28 U.S.C. § 2466(b).
The effect of an order of fugitive disentitlement is "to...
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