United States v. Mongol Nation
| Decision Date | 06 January 2023 |
| Docket Number | s. 19-50176,19-50190 |
| Citation | 56 F.4th 1244 |
| Parties | UNITED STATES of America, Plaintiff-Appellee/Cross-Appellant, v. MONGOL NATION, Unincorporated Association, Defendant-Appellant/Cross-Appellee. |
| Court | U.S. Court of Appeals — Ninth Circuit |
George L. Steele (argued), Law Office of George L. Steele, La Cañada, California; Stephen P. Stubbs, Las Vegas, Nevada; for Defendant-Appellant.
Bram M. Alden (argued), Assistant United States Attorney, Criminal Appeals Section Chief; Christopher Brunwin, Assistant United States Attorney; Tracy L. Wilkison, Acting United States Attorney; Office of the United States Attorney, Los Angeles, California; for Plaintiff-Appellee.
John D. Loy, David E. Snyder, and Monica N. Price, First Amendment Coalition, San Rafael, California, for Amici Curiae First Amendment Coalition and California Attorneys for Criminal Justice.
Before: Sandra S. Ikuta, Danielle J. Forrest, and Holly A. Thomas, Circuit Judges.
This case concerns the Government's ability to prosecute an unincorporated association for violations of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961 et seq. , and to subsequently seek forfeiture of that association's intellectual property.
Defendant Mongol Nation is an unincorporated association whose members include the official, or "full-patch," members of the Mongols Gang. The Government has been prosecuting the Mongols Gang since at least 2008, leading to the convictions of more than 70 individual members under RICO and various other criminal statutes. Following those convictions, the Government indicted Mongol Nation (the unincorporated association) on charges of substantive RICO and RICO conspiracy violations. A jury convicted the association on both charges. It also found various forms of Mongol Nation property forfeitable. That property included certain collective membership marks—a type of intellectual property used to designate membership in an association or other organization. The district court denied forfeiture of those marks, holding that under the circumstances of this case forfeiture would violate the First and Eighth Amendments.
Mongol Nation appealed its conviction and sentence, and the Government cross-appealed the order denying forfeiture of the marks. The parties' cross-appeals present two issues. First, did the district court lack jurisdiction because Mongol Nation does not qualify as a "person" as defined by RICO; and second, did the district court err in denying forfeiture of the Mongol Nation marks?
We affirm. There was no defect in the district court's jurisdiction stemming from RICO's definition of "person," and we agree with the district court that denial of forfeiture was appropriate under these circumstances.
Defendant Mongol Nation is "an unincorporated association comprised of ‘official’ or ‘full-patch’ members of the Mongols Gang," a violent, drug trafficking organization. United States v. Mongol Nation , 693 F. App'x 637, 638 (9th Cir. 2017).1
The current proceedings against Mongol Nation are the latest step in a series of related prosecutions, including the prior prosecutions and guilty pleas of dozens of individual members of the Mongols Gang.2 Because those prior prosecutions also involved attempts by the Government to effect forfeiture of the collective membership marks at issue here, we briefly recount the history of those earlier proceedings.
In its earlier prosecution of individual Mongols members—including that of the former leader of the Mongols, lead defendant Ruben Cavazos, Sr.—the Government sought forfeiture of two registered collective membership marks owned by Mongol Nation.3 Cavazos , 2011 WL 13143670, at *1 ; id. , ECF No. 1 (Indictment); Rivera , 2009 WL 8753486, at *1 & n.1. Pursuant to an application by the Government, the district court enjoined the Cavazos defendants from taking "any action that would affect the availability, marketability or value of the MONGOLS trademark" and ordered defendants "to surrender for seizure all ... [items] bearing the [mark]." Rivera , 2009 WL 8753486, at *1.
In response to that order, Ramon Rivera—a member of Mongol Nation who was not charged in Cavazos —filed a civil action seeking an injunction to prevent the Government from seizing property based solely on the fact that it bore the relevant marks. Id. , ECF. No. 1 (Complaint). The district court granted a preliminary injunction. It found that Mongol Nation (the unincorporated association) and Mongols Nation Motorcycle Club, Inc. were the exclusive owners of the marks, rather than Cavazos or any other individual member of the organizations, and that the marks were therefore not forfeitable under RICO in the context of the Cavazos prosecutions. Rivera , 2009 WL 8753486, at *7.4 The district court ultimately granted summary judgment to Rivera. Id. , ECF No. 90 (Summary Judgment Order).
Meanwhile, criminal proceedings continued in Cavazos . Following Cavazos' guilty plea, the Government continued to seek forfeiture of the marks. See United States v. Cavazos , 2009 WL 10680370, at *1–3. On June 15, 2010, the district court entered a preliminary order of forfeiture (POF) concerning the marks, finding that they "b[ore] some nexus to the criminal enterprise in which ... defendants were involved." Id. at *1, 3. In response, Mongols Nation Motorcycle Club, Inc. filed a petition to vacate or amend the order under 18 U.S.C. Section 1963(l), asserting a property interest in the marks. Id. at *1.
The district court granted Mongols Nation Motorcycle Club, Inc.'s petition and vacated the POF. It concluded that the marks were not forfeitable because: (1) RICO authorizes forfeiture only of property belonging to a defendant, and (2) the "club," rather than any indicted defendant, maintained exclusive ownership of the marks. See id. at *3–4.
Following those earlier prosecutions, Mongol Nation, the defendant in this case, was indicted for substantive RICO and RICO conspiracy violations.
Mongol Nation successfully moved the district court to dismiss the indictment "on the ground that there is no meaningful distinction between the association Mongol Nation and the enterprise of the Mongols Gang." Mongol Nation , 693 F. App'x at 637 (internal quotation marks omitted). We reversed, holding that "Mongol Nation was alleged to be part of a larger whole, the Mongols Gang, which is comprised of additional individuals who together form the alleged enterprise." Id. at 638. We declined to address Mongol Nation's challenges to the Government's efforts to effect forfeiture of the Mongols' membership marks as "premature" and "not ripe for review." Id.
On remand, the Government filed a superseding indictment (FSI), and the case proceeded to a jury trial. The jury found Mongol Nation guilty on two counts: substantive RICO (Count I) and RICO conspiracy (Count II). See 18 U.S.C. § 1962(c) – (d). Mongol Nation filed post-trial motions for judgment of acquittal and for a new trial, which were denied.
The FSI also contained forfeiture allegations. The Government sought forfeiture of (among other things): "(1) all rights associated with the collective membership marks described in the FSI and the Government's Bills of Particulars ... (collectively, the ‘Marks’)"; and (2) "items of personal property bearing any of the Marks, which ... were seized in connection with [the investigation]."5 See Mongol Nation , No. CR 13-0106-DOC-1 (C.D. Cal.), ECF Nos. 264 (Gov't's Forfeiture Mem.), 269 (Gov't's Third Bill of Particulars).
The district court conducted a jury trial on the forfeiture allegations. The jury found that none of the relevant property was forfeitable under Count I—the substantive RICO count. As for Count II—the RICO conspiracy count—the jury found the following property forfeitable: (1) the Marks, (2) relevant items bearing the Marks, and (3) weapons, ammunition, and body armor. Following the forfeiture trial, the Government filed a motion for a POF concerning that property under RICO, 18 U.S.C. § 1963, including forfeiture of all rights associated with the Marks.
The district court denied the Government's POF motion in part. The district court granted the requested forfeiture of the Mongols' weapons, ammunition, body armor, and specific Mongols property seized during raids by federal agents. But it denied forfeiture of the "rights associated" with the "collective membership marks" on the ground that forfeiture in these circumstances would violate the First and Eighth Amendments. Mongol Nation , 370 F. Supp. 3d at 1114–16, 1120.
As to the First Amendment, the district court held that forfeiture of all rights to the Marks would impermissibly prevent or discourage Mongols members from displaying the Marks. Id. at 1112–13. The district court reasoned that such display constitutes "expressive conduct ... communicat[ing] a person's association with the Mongol Nation, and his or her support for their views." Id. According to the district court, the first "POF—which would vest title [to the Marks] in the United States—[would] function[ ] as a prior restraint on future speech" and also regulate speech based on its content. Id. at 1114. Applying strict scrutiny review, the court concluded that the POF was not sufficiently tailored to the Government's compelling interest in punishing and dismantling criminal organizations. Id. at 1114–15.
Turning to the Eighth Amendment, the district court reasoned that the first POF would violate the amendment's prohibition on excessive fines because forfeiture of the Marks would be "harsh and grossly disproportionate" to Mongol Nation's crime of RICO conspiracy. Id. at 1119. The district court reasoned that the Marks, which "were acquired in 1969 upon first use and have been maintained through...
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... ... signifying tattoo or "full-patch." See, ... e.g. , United States v. Mongol Nation , 56 F.4th ... 1244, 1246 (9th Cir. 2023) ... ...