United States v. Clayton
| Docket Number | 21-CR-70 |
| Decision Date | 24 January 2022 |
| Parties | UNITED STATES OF AMERICA, Plaintiff, v. DWIGHT CLAYTON, et al., Defendants. |
| Court | U.S. District Court — Eastern District of Wisconsin |
RECOMMENDATIONS AND ORDER
Dwight Clayton and Jeffrey Coleman are charged in a superseding indictment with conspiracy to distribute controlled substances. (ECF No. 72 (Count One).) Clayton is also charged with possession of a firearm in furtherance of a drug trafficking offense (ECF No. 72 (Count Two)), engaging in a prohibited financial transaction (ECF No. 72 (Count Three)) and money laundering (ECF No. 72 (Count Six)).
Currently before the court are Clayton's motions to suppress based on an unlawful arrest (ECF No. 41), an unlawful vehicle stop and search (ECF No. 42), and an unlawful search pursuant to a search warrant (ECF No. 43), as well as Coleman's motions to suppress based on an unlawful stop (ECF No. 29), an unlawful arrest (ECF No. 30), and an unlawful vehicle search (ECF No. 31). An evidentiary hearing was held before this court on October 18, 2021. The parties then submitted post-hearing briefs. Relevant facts adduced at that hearing are set forth below. At the expense of some duplication, the court's discussion of each motion is preceded by a discussion of those facts relevant to the motion.
The court previously addressed other motions filed by the defendants. (See ECF Nos. 54, 55 (addressing ECF Nos. 28, 32, 44); 58, 59 (addressing ECF No. 33).) A motion for the return of property (ECF No. 19) is currently pending before Judge Adelman.
2.1. Facts
The present investigation began in March of 2020 when DEA Task Force Officer Matthew Cooper was contacted by investigators from the Northern District of Illinois about money laundering occurring in Illinois and Wisconsin. (ECF No. 93 at 63-64.) On March 14, 2020, Wisconsin investigators participated in a transaction in which about $149, 000 was delivered by an Illinois suspect to an undercover officer in Wisconsin. (ECF No. 93 at 65.) A delivery of a similar amount of currency between the suspect and the undercover officer occurred about a week later. (ECF No. 93 at 66.)
Following those deliveries, investigators obtained a warrant to track the location of the Illinois suspect's vehicle. (ECF No. 93 at 66-67.) This led to a traffic stop of that vehicle on April 2, 2020, during which law enforcement noticed that a second vehicle appeared to be traveling with the vehicle of the Illinois suspect. (ECF No. 93 at 67-68.) Investigators tracked both vehicles to a Walgreens on the north side of Milwaukee, where the Illinois suspect got out of his car and into the second vehicle and then traveled to a commercial parking lot located at 5270 West Clinton Avenue in Milwaukee. (ECF No. 93 at 68.) One of the businesses that used this parking lot was S&C Trucking, owned by Clayton. (ECF No. 93 at 69.) After about three minutes the second vehicle left the parking lot and returned to the Walgreens. (ECF No. 93 at 69.) After about 30 minutes at the Walgreens parking lot a third car, a grey Hyundai registered to Clayton, arrived. The Illinois suspect exited the second vehicle and got into the Hyundai, where he sat for about five to ten minutes. (ECF No. 93 at 69.) The Illinois suspect then returned to his vehicle. (ECF No. 93 at 70.)
The grey Hyundai left the Walgreens and was not followed. (ECF No. 93 at 70.) The second car went to a nearby gas station. (ECF No. 93 at 70.) The first car drove around the block, which Cooper characterized as a common counter-surveillance technique, and then returned to the Clinton Avenue parking lot. (ECF No. 93 at 70.) After the first car drove down the dead-end street leading to the Clinton Avenue parking lot, investigators saw both the second and the third vehicles drive toward the parking lot. (ECF No. 93 at 70-71.) About ten minutes later an investigator saw several people standing around the vehicles in the parking lot, and the Illinois suspect seemed to be conducting counter-surveillance. (ECF No. 93 at 71.)
Shortly thereafter the first car left the parking lot, went to the gas station where the second car had stopped, and then returned to the area of the Clinton Avenue parking lot. (ECF No. 93 at 71.) However, instead of parking in the same parking lot, this time the first car parked across the street and the Illinois suspect seemed to again conduct counter-surveillance. (ECF No. 93 at 71.) After about 30 to 60 minutes, the three vehicles left. The first two vehicles went to the same Walgreens at which they had stopped earlier. (ECF No. 93 at 71.) The third vehicle, the grey Hyundai registered to Clayton, first went to a McDonalds and then to a residence at 9736 W. Tower Avenue, where it entered the garage. (ECF No. 93 at 71-72.)
Several months later, on September 10, 2020, Milwaukee Police executed a search warrant at a residence that Clayton owned and reportedly rented to a friend of a friend. (ECF No. 93 at 81-82.) Clayton arrived at the residence while police were still there and provided his address as 9736 W. Tower Avenue. (ECF No. 93 at 82.)
On September 23, 2020, another DEA office contacted Cooper and told him that they had “received a quantity of bulk currency” from Clayton, and Clayton had been driving a Dodge Ram 2500 pickup with Wisconsin registration. (ECF No. 93 at 83.)
In October 2020 the FBI received an online tip that Clayton was involved in money laundering using his trucking business, S&C Trucking. (ECF No. 93 at 84-85.) The tipster, who identified themself and later met with investigators, stated that Clayton had a prior federal drug conviction and that s/he believed a former co-defendant of Clayton's, Christopher Powell, was involved. (ECF No. 93 at 85, 118.) This led Cooper to look into all of the co-defendants in Clayton's prior federal case, resulting in him identifying Coleman for the first time. (ECF No. 93 at 86; see also United States v. Clayton, 04-CR-66 (E.D. Wis.).)
On October 20, 2020, 61 kilograms of cocaine were seized by law enforcement in Texas that had been concealed in a pallet wrapped in clear plastic wrap. (ECF No. 93 at 72-73.) That cocaine was intended to be shipped by a commercial shipper to a business located at 1850 North Martin Luther King Drive in Milwaukee. (ECF No. 93 at 73.) Investigators learned that this business was registered to someone named Ronny Thompson. (ECF No. 93 at 74.) A review of Thompson's phone records revealed that he was in frequent contact with Clayton-over 100 contacts in about two months. (ECF No. 93 at 74-75.) Thompson and Clayton were also Facebook friends and identified as business partners in an online article. (ECF No. 93 at 75.)
Investigation discovered that there had been three similar shipments from Texas to the Milwaukee business other than the one that was intercepted. (ECF No. 93 at 77.) After learning that those shipments occurred on August 21, August 28, and September 25 of 2020, Cooper attempted to locate surveillance video that might have recorded the deliveries. (ECF No. 93 at 78.) Cooper found surveillance video for August 21, 2020, that recorded Clayton arriving in a black Dodge Ram 2500 pickup, pulling up to the delivery truck, and then leaving with a full-sized pallet now loaded in the bed of the truck. (ECF No. 93 at 79.)
On November 3, 2020, Clayton left the home on Tower Avenue and met with an undercover officer, to whom Clayton delivered about $150, 000 in currency. (ECF No. 93 at 87.) The next day investigators installed a pole camera to monitor the parking lot on Clinton Avenue. (ECF No. 93 at 88.) Investigators also obtained warrants to track Clayton's pickup truck, a Kia Optima that Clayton was known to drive, and his phone. (ECF No. 93 at 89.)
On November 24, 2020, Cooper noticed that Clayton's vehicle and phone were on the south side of Milwaukee, which was unusual; Clayton generally remained on the north side. (ECF No. 93 at 90.) Cooper located Clayton's vehicle in the parking lot of a bank in Cudahy. (ECF No. 93 at 90.) Clayton was in the driver's seat, and in the front passenger seat was a person in a baseball hat and dark jacket. (ECF No. 93 at 91.) The two then drove a short distance and parked in front of another bank. (ECF No. 93 at 91.) The passenger got out of the vehicle with a suitcase; he was also carrying a second bag. (ECF No. 93 at 91.) The passenger went inside the bank and approached the tellers. (ECF No. 93 at 91.) Clayton drove away. (ECF No. 93 at 91-91.) The passenger remained in the bank for about 45 to 60 minutes. (ECF No. 93 at 92.) After that, he left in an Uber. (ECF No. 93 at 92.)
Cooper identified the passenger as Kevin Mathis[1] and learned that, while in the bank, Mathis made a deposit of $169, 650 in currency. (ECF No. 93 at 92.)
Cooper then obtained a warrant to track the location of Mathis's phone. (ECF No. 93 at 93.) From tracking Mathis's phone and reviewing his bank records, Cooper and DEA Special Agent Kellen Williams learned that Mathis had a pattern of traveling to numerous cities in 19 different states, meeting with drug traffickers, picking up bulk currency, depositing that cash into a bank, and then immediately leaving the city. (ECF No. 93 at 97, 196.) Within 24 hours of the deposits, the funds were then withdrawn, often to accounts overseas, but also to cryptocurrency accounts and accounts of other businesses. (ECF No. 93 at 197.)
On January 27, 2021, Mathis's phone returned to Milwaukee. (ECF No. 93 at 97.) On this date Clayton's vehicle and phone left the Tower Avenue address and began to drive on the expressway south toward downtown Milwaukee. (ECF No. 93 at 99.) But he soon turned around and went to...
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