United States v. Rosga, Criminal No. 3:10CR170–HEH.

• Citation: 864 F.Supp.2d 439
• Decision Date: 21 May 2012
• Docket Number: Criminal No. 3:10CR170–HEH.
• Parties: UNITED STATES of America v. Jack ROSGA, et al., Defendants.
• Court: U.S. District Court — Eastern District of Virginia

864 F.Supp.2d 439

UNITED STATES of America

v.Jack ROSGA, et al., Defendants.

Criminal No. 3:10CR170–HEH.

United States District Court,

E.D. Virginia,

Richmond Division.

May 21, 2012.

Dennis Fitzpatrick, United States Attorney Office, Alexandria, VA, Peter S. Duffey, Office of the U.S. Attorney, Richmond, VA, for Plaintiff.

Claire Grimmer Cardwell, William Jeffrey Dinkin, Stone Cardwell & Dinkin PLC, Maria Denoia Jankowski, Law Office

of Maria D. Jankowski, Vinceretta Taylor Chiles, Vinceretta Taylor Chiles P.C., Horace Frazier Hunter, Hunter & Lipton LLP, Theodore David Bruns, Blackburn Conte Schilling & Click P.C., Charles Arthur Gavin, Cawthorne Pickard Rowe Deskevich & Gavin P.C., Diane Marie Abato, Abato & Davis P.C., Gray Bolling Broughton, Matthew Peter Groh, Williams Mullen, Vaughan Christopher Jones, Johnson Jones LLP, David R. Lett, John Angelo March, Jr., James Mark Nachman, Charles De Mon Lewis, Mark Kevin Tyndall, Elliott Bruce Bender, Reginald Moore Barley, Richmond, VA, Craig Alan Mastantuono, Mastantuono Law Office, Na Pro Hac, Vice, Milwaukee, WI, Charlotte P. Hodges Big Legal Services PLLC Midlothian, VA Anthony Philip Lomonaco, Bradley Lamar Henry, The Law Offices of A. Philip Lomonaco, Pro Hac, Vice, Knoxville, TN, Peter Dean Eliades, Eliades & Eliades, Hopewell, VA, Craig Weston Sampson Barnes & Diehl P.C., Chesterfield, VA, John Frederick McGarvey Glen Allen, VA, for Defendants.

MEMORANDUM OPINION

HENRY E. HUDSON, District Judge.

This matter comes before the Court on two sets of petitions by non-defendant third parties to amend numerous forfeiture orders previously entered in this case, as well as motions by the United States to strike those petitions. For the reasons set forth herein, the third-party petitions will be denied, and the Government's motions will be granted.

I. BACKGROUND

A. The Underlying Orders of Forfeiture

On June 10, 2010, the Grand Jury returned an Indictment charging twenty-seven members and affiliates of the American Outlaws Association (“AOA”) and Outlaws Motorcycle Club (“OMC”) with crimes pertaining to their participation in an organized criminal enterprise. Pursuant to Federal Rule of Criminal Procedure 32.2, the Indictment provided all of the defendants with the following notice:

[T]he United States will seek forfeiture as part of any sentence, in accordance with Title 18, United States Code, Section 1963, in the event of any defendant's conviction under Count One of this Indictment[,] ... [of] property ... constituting and derived from proceeds obtained, directly [or] indirectly, from racketeering activity, ... [in which the defendant has] acquired and maintained [an] interest[ ].¹

(ECF No. 3 at 47–50.) After two separate trials, all but six of the defendants were found guilty of racketeering-related offenses, and sixteen were convicted of Conspiracy to Violate the Racketeer Influenced and Corrupt Organizations Act (“RICO”) in violation of 18 U.S.C. § 1962(d).

“RICO provides for drastic remedies,” including the “forfeiture of illegal proceeds” and any property which gave the defendant influence over the criminal enterprise. H.J. Inc. v. Northwestern Bell Telephone Co., 492 U.S. 229, 233, 109 S.Ct. 2893, 106 L.Ed.2d 195 (1989); 18 U.S.C. § 1963(a); see generally United States v. Martin, 662 F.3d 301, 306 (4th Cir.2011) ( “Criminal forfeiture is part of a defendant's sentence.”). As the Fourth Circuit has observed, the RICO statute contains what is “by far the most far reaching forfeiture provision, sweeping far more broadly than the substantive RICO offense itself.” United States v. Cherry, 330 F.3d 658, 669 n. 18 (4th Cir.2003) (internal quotation marks and citation omitted). Upon their convictions in this case, several of the defendants entered into forfeiture agreements with the United States.

Finding the “requisite nexus between the property” identified in the agreements and the respective defendant's crime(s) of conviction, and concluding “that the defendant ha[d] an interest in” the subject property, this Court approved and entered the consent orders of forfeiture now in dispute. ( See, e.g., ECF No. 821.) Of particular relevance to the immediate matter, the Court directed the forfeiture of, among other things:

All indicia or ‘colors' associated with the American Outlaws Association or a rival organized motorcycle club, to include vests; jackets; t-shirts; clothing accessories; patches; banners; flags; and signs; recovered from [the defendant's residence or regional clubhouse].

( E.g., id.) For example, the Court ordered the forfeiture to the United States of specified property seized from defendant Jack Rosga's residence, as well as an AOA clubhouse, both located in Milwaukee, Wisconsin. ( Id. at 1–2.) The Court also approved the forfeiture of property recovered from defendants' homes and clubhouses in Virginia, North Carolina, South Carolina, Montana, and Maine.

Following this Court's entry of preliminary orders of forfeiture, the Government provided public notice on an official government website—www. forfeiture. gov—of the pending forfeiture actions and its intent to dispose of the seized assets. ( See, e.g., ECF No. 912.) As to defendant Rosga, for instance, forfeiture notices were posted online from May 13 until June 11, 2011, and again from September 1 until September 30, 2011. (Eads Aff. 1, ECF Nos. 912–1, 955–1.) The United States also represented to the Court that it had “notified all third parties of their right to petition the Court ... to adjudicate the validity of their legal interest in the property.” (ECF No. 912.) After 30 days from the last date of publication, this Court's orders of forfeiture became final.

B. Petitioners' Challenges to the Forfeiture of OMC “Indicia” or “Colors”

Kevin O'Neill (“O'Neill”), Steve Kaczmarek (“Kaczmarek”), Lawrence Barboza (“Barboza”), and Peter Gross (“Gross”) (collectively, “Petitioners”) are AOA and OMC members who were not named as defendants in this case. Asserting two separate clusters of claims, Petitioners move this Court to amend its previous forfeiture orders pursuant to 18 U.S.C. § 1963( l ). The first set, which includes petitions by O'Neill, Kaczmarek, and Gross, contests the Court's April 8, 2011 Consent Order of Forfeiture as to defendant Jack Rosga.² The second set of petitions,filed by O'Neill and Barboza, challenges ten additional agreed orders of forfeiture in this action.³ In short, Petitioners ⁴ seek “the return of all indicia and other property associated with the Outlaws Motorcycle Club ... and the American Outlaws Association” subject to forfeiture. (First O'Neill Pet. 1; Second O'Neill Pet. 1.)

Petitioners advance two arguments in support of their claims. First, they maintain that the Government failed to give statutorily and constitutionally adequate notice of the pending forfeitures. And second, they assert that none of the defendants in this matter owned the AOA and OMC indicia disposed of in their respective consent orders, such that the defendants lacked the power lawfully to agree to the forfeiture of that property.

In response, the Government contends that it complied with its constitutional and statutory duty to provide public notice of the forfeiture actions in question. The Government further argues that the vast majority of Petitioners' claims are time-barred. Finally, the Government asserts that, in any event, Petitioners lack standing to proceed on their claims. Petitioners have all replied, and the matter is now ripe for decision.⁵

II. LEGAL STANDARD

Title 18 U.S.C. § 1963( l ) provides an ancillary process “through which a third party may protect his interest in property that has been subject to a forfeiture order.” United States v. McHan, 345 F.3d 262, 269 (4th Cir.2003). After the entry of a forfeiture order, § 1963 requires the United States to “publish notice of the order and of its intent to dispose of the property.” 18 U.S.C. § 1963( l )(1). Additionally, “[t]he Government may ..., to the extent practicable, provide direct written notice to any person known to have alleged an interest in the property that is the subject of the order of forfeiture as a substitute for published notice as to those persons so notified.” Id. The Federal Rules of Criminal Procedure similarly provide that, “[i]f the court orders the forfeiture of specific property, the government must publish notice of the order and send notice to any person who reasonably appears to be a potential claimant with standing to contest the forfeiture in the ancillary proceeding.” Fed.R.Crim.P. 32.2(b)(6)(A). The Government may satisfy its publication duty through any of the methods set forth in Supplemental Rule G(4)(a)(iv) of the Federal Rules of Civil Procedure, including by “posting notice on an official internet government forfeiture site for at least 30 consecutive days.” Fed.R.Civ.P. G(4)(a)(iv)(C).

Within 30 days of receiving notice, “[a]ny person, other than the defendant, asserting a legal interest” in the property may “petition the court for a hearing to adjudicate the validity of his alleged interest in the property.” Id. § 1963( l )(2). The petition must be signed and must set forth the nature and extent of the petitioner's interest in the property. Id. § 1963( l )(3). “[T]o the extent practicable and consistent with the interests of justice,” the court is directed to hold a hearing “within thirty days of the filing of the petition,” at which the petitioner and the United States may present witnesses and other evidence. Id. § 1963( l )(4). Ultimately, the claimant must demonstrate by a preponderance of the evidence that he

has a legal right, title, or interest in the property, and such right, title, or interest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave...