United States v. Chicago

• Decision Date: 16 March 2017
• Docket Number: CRIMINAL NO. 15-00168-CG
• Parties: UNITED STATES OF AMERICA v. MANILA CHICAGO, Defendant.
• Court: U.S. District Court — Southern District of Alabama

UNITED STATES OF AMERICA v. MANILA CHICAGO, Defendant.

CRIMINAL NO. 15-00168-CG

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION

March 16, 2017

ORDER and MEMORANDUM OPINION

This matter is before the Court on a motion to dismiss the petition of Loan Nguyen ("Nguyen") seeking to adjudicate her interest in certain personal and real property addressed within the Court's Amended Preliminary Order of Forfeiture ("APOF") filed by the Government (Doc. 109), Nguyen's objection thereto (Doc. 112), and the Government's reply (Doc. 115). Based on the following reasons, the Government's motion is GRANTED.

I. FACTUAL BACKGROUND

Nguyen's husband, Manila Chicago ("Chicago"), pleaded guilty to three counts within an indictment charging, in Count 4, possession with intent to distribute marijuana, in Count 5, using, carrying, possessing a firearm in relation to and in the furtherance of a drug trafficking felony, and in Count 11, money laundering. (Doc. 70). The Indictment also alleged and included criminal forfeiture under 21 U.S.C. § 853 and 18 U.S.C. § 982(a)(1), regarding certain properties. (Doc. 1, pp. 7-8). The Government later produced a Bill of Particulars naming additional properties. (Doc. 27). In the plea agreement, Chicago agreed "to the forfeiture of any interest he has in the properties identified in the forfeiture allegations in the indictment and the bill of particulars." (Doc. 70, p. 23). Upon motion of the Government (Doc. 77), the Court entered a Preliminary Order of Forfeiture (Doc. 78), which was later amended and is the APOF now in question (Doc. 80).

The APOF, which Nguyen would have the Court amend in her favor, was entered on August 16, 2016. Therein, the Court found that, based upon Chicago's guilty plea and the Government's brief, adequate factual and legal support existed to issue the APOF. The APOF forfeited from Chicago the following property:

1. The contents of PNC Bank Account No. XXXXXX7406, a joint checking account held in the names of Manila Chicago and/or Loan Nguyen;

2. The contents of PNC Bank Account No. XXXXXX1595, a checking account held in the name of Loan Nguyen;

3. The residence of real property at 13915 Sprinkle Avenue, Mobile, Alabama, 36509;

4. The real property identified as Mobile County Parcel # R021309320000107.02 containing approximately 5.41 acres and legally described as following:

COMG AT THE INT OF THE N/L OF THE S1/2 PF SEC 32, R2W, 7 THE E ROW/L OF U.S. HWY 45 RUN 06 DEG 08MIN 58 SEC W ALG SD E ROY/L 441.77 FT TO THE POB OF THE PARCEL HEREIN DESC.;

5. One black 2014 Ford Mustang Coupe, VIN 1ZVBP8CF7E5280204;

6. One Husqvarna lawn tractor, Model M-ZT61, Serial No. 042514B002339, including Kawasaki engine with Serial No. FS691VA29169; and

7. $14,769.00, more or less, in United States Currency.

(Doc. 8, p. 2-3). After the Government provided notice of the APOF, Nguyen timelyfiled her Petition as a third party with an interest in the property contained within paragraph 1, 2, 3, 4, and 7 above. (Doc. 84). On the same day, Nguyen filed her Supplemental and Amended Petition. (Doc. 85). The Government now moves to dismiss Nguyen's petitions for failure to state a legally sufficient claim upon which relief can be granted.

II. ANALYSIS

Title 21, United States Code, Section 853(n) protects third parties who may have an interest in property subject to forfeiture by giving them a limited right to participate temporarily in a criminal case through a hearing called an ancillary proceeding. United States v. Cone, 627 F.3d 1356, 1358 (11th Cir. 2010). The purpose of an ancillary proceeding is to exempt the interest of qualifying third parties from criminal forfeiture. United States v. Ramunno, 599 F.3d 1269, 1273 (11th Cir. 2010). Any third party asserting a "legal interest" in forfeited property "may, within thirty days of the final publication of notice or h[er] receipt of notice ... whichever is earlier, petition the court for a hearing to adjudicate the validity of h[er] alleged interest in the property." 21 U.S.C. § 853(n)(2).

Rule 32.2 of the Federal Rules of Criminal Procedure, however, provides that in "an ancillary proceeding, the court may, on motion, dismiss the petition for lack of standing, failure to state a claim, or for any other lawful reason." Fed. R. Crim. Proc. 32.2(c)(1)(A). A motion to dismiss a third party's claim is treated like a 12(b) motion in a civil case; all facts are assumed to be true. See United States v. Grossman, 501 F.3d 846, 848 (7th Cir. 2007) (concluding under Rule 32.2(c)(1)(A),the Government may move to dismiss a third party claim on any ground to which a 12(b) motion would apply in a civil case); Pacheco v. Serendensky, 393 F.3d 348, 352 (2d Cir. 2004) (finding a motion to dismiss a third party claim in an ancillary proceeding is treated like a 12(b) motion in a civil case). If, taking all facts alleged in the petition as true, it fails to set forth ground upon which the claim would prevail, the claim must be dismissed. United States v. Salti, 579 F.3d 656, 669-70 (6th Cir. 2009) (finding a third party claim may be dismissed on the pleadings if, assuming all facts alleged in the claim to be true, claimant has not asserted a legal interest in the forfeited property).

A. Pleading Requirements Under 21 U.S.C. § 853(n)(3)

Section 853(n)(3) requires a petition "be signed by the petitioner under penalty of perjury." 21 U.S.C. § 853(n)(3). Further, the petition "shall set forth the nature and extent of the petitioner's right, title, or interest in the property" along with "the time and circumstances of the petitioner's acquisition of the right, title, or interest in the property, any additional facts supporting the petitioner's claim, and the relief sought." Id. These pleading requirements are not "simply technical requirements, but are construed strictly to discourage false or frivolous claims." United States v. Ceballos-Lepe, 977 F. Supp. 2d 1085, 1088-89 (D. Utah 2013) (citation omitted).

The Government contends that Nguyen failed to meet this standard because she "makes conclusory allegations that she is either the owner, co-owner, joint or equitable owner with an interest in the said property" by way of being an "innocentowner, or because she personally paid or contributed for some or all of the property, either in her own right or with income otherwise legitimately earned or obtained." (Doc. 109, p. 9). Thus, the issue is whether Nguyen has set forth sufficient detail concerning the "nature and extent" of her ownership and "time and circumstances" of the acquisition of said interest within her Petition and Supplemental and Amended Petition as required by § 853(n)(3).

As to the personal property, it consists of $14,769.00 confiscated from Chicago at the Atlanta Airport and the contents of two accounts at PNC Bank. Neither the Petition nor the Supplemental and Amended Petition establish the nature and extent of Nguyen's ownership in the money confiscated at the Atlanta Airport. Instead, Nguyen asserts, in her own hand, that Chicago earned the money either working as a welder or gambling at a casino. (Doc. 84-1, p. 2). In other words, the money is Chicago's, not Nguyen's. But either way, the W2 or gambling receipts referenced in the exhibit attached to the Petition are not provided. See (Doc. 84-1). In regards to the two bank accounts, Nguyen provided documentation from PNC Bank, under which she claims to be either the sole account holder or joint owner with Chicago. (Doc. 84-1, pp. 3-4). Beyond this, Nguyen fails to explain the time and circumstances upon which she acquired an interest in the proceeds of either account. "In interpreting the 'time and circumstances' requirement, courts have held that a petition must 'do more than state [the] interest in a conclusory fashion." United States v. Preston, 123 F. Supp. 3d 108, 114 (D.D.C. 2015) (quoting United States v. Kokko, 2007 WL 2209260, at *5 (S.D. Fla. July 30, 2007)).Nguyen's bare-bones assertions regarding the cash and accounts are not enough.

As to the real property contained within the APOF, Nguyen provides a copy of the warranty deed for each property (Sprinkle Avenue and the 5.41 acres of land). Based on the deeds, Nguyen and Chicago own each property as joint tenants with right of survivorship. (Doc. 84-1, pp. 5-10). Therefore, the Petition sufficiently establishes the nature and extent of Nguyen's interest in the properties. But the Petition fails to delineate the time and circumstances by which Nguyen acquired Sprinkle Avenue or the 5.41 acres. The only factual context that the deeds provide is the date certain upon which transfer of ownership occurred. Like the accounts, such bare-bones allegations fail to satisfy § 853(n)(3).

The Court recognizes that Nguyen filed a Supplemental and Amended Petition on the same day she filed her original petition. The Supplemental and Amended Petition does not lend Nguyen aid in meeting her statutory pleading requirement because Nguyen did not sign it under penalty of perjury before filing it with the Court. Instead, it was only signed by counsel. An interested third party's petition that is signed only by counsel cannot be considered in deciding a motion to dismiss and is grounds for dismissal. United States v. Burge, 829 F. Supp. 2d 664, 667 (D.C. Ill. 2011). But even if the Supplemental and Amended Petition were considered, Nguyen still fails to satisfy § 853(n)(3). The Supplemental and Amended Petition articulates that Chicago and Nguyen owned the property and were the "original mortgagor in 2001" and then modified the loan in 2007. (Doc. 85, p. 5). Nguyen claims this shows her ownership was in existence "before any of thealleged illegal conduct took place," and she was unaware of Chicago's illegal activity and never named as a result of the police investigation. Id. In all of this, however, Nguyen fails to explain the time and circumstances of her Sprinkle Avenue acquisition, which is apparently before 2001. That she...