US v. Real Property in Mecklenburg County, NC

• Decision Date: 21 January 1993
• Docket Number: No. C-C-89-344-M.,C-C-89-344-M.
• Parties: UNITED STATES of America, Plaintiff, v. REAL PROPERTY IN MECKLENBURG COUNTY, N.C., KNOWN AS LEOLA'S PLAZA, LOCATED AT 1501 WEST BOULEVARD, and Safety Deposit Box 148, Wilkinson Blvd., Office of First Citizens Bank, Defendants.
• Court: U.S. District Court — Western District of North Carolina

814 F. Supp. 468

UNITED STATES of America, Plaintiff, v. REAL PROPERTY IN MECKLENBURG COUNTY, N.C., KNOWN AS LEOLA'S PLAZA, LOCATED AT 1501 WEST BOULEVARD, and Safety Deposit Box 148, Wilkinson Blvd., Office of First Citizens Bank, Defendants.

No. C-C-89-344-M.

United States District Court, W.D. North Carolina, Charlotte Division.

January 21, 1993.

B. Frederic Williams, Asst. U.S. Atty., U.S. Dept. of Justice, Charlotte, NC, for plaintiff.

Kenneth P. Andresen, Caudle & Spears, David Williams, Hoover & Williams, and Robert C. Hord, Jr., Charlotte, NC, for defendants.

ORDER

McMILLAN, District Judge.

The question before the court is whether to approve the Memorandum and Recommendation ("M & R") entered in this case by United States Magistrate Judge Paul B. Taylor.

Judge Taylor's M & R was filed on February 14, 1992 (Document # 76 in the court file).

In his M & R, Judge Taylor, an eminently diligent and capable magistrate judge, has summarized the facts, which are supported by the record, and has identified and described the evidence in the record which support his conclusions. The M & R is characteristically clear, thorough, factual and rational.

I doubt that any attempt by me to re-plow the same ground that Judge Taylor has already covered would do anything but add weight to the file.

This court hereby adopts Judge Taylor's summary of the case, including the facts he finds, and the conclusions, legal and otherwise, that he draws.

Upon those facts, the seizure and forfeiture of the property were abundantly justified and the decision of Judge Taylor should be affirmed in its entirety.

IT IS THEREFORE ORDERED:

1. That all objections and requests for relief asserted by the defendant are OVERRULED;

2. That the Memorandum and Recommendation of the United States Magistrate Judge Paul B. Taylor is AFFIRMED in its entirety; and

3. That the relief sought by the United States of America is ALLOWED.

The court is filing simultaneously herewith a Judgment of Forfeiture.

JUDGMENT OF FORFEITURE

McMILLAN, District Judge.

THIS MATTER is before the Court upon Plaintiff's motion for summary judgment pursuant to Fed.R.Civ.P. 56 and the Magistrate Judge's Memorandum and Recommendation pursuant to 28 U.S.C. § 636(b), the Court finds that:

1. The United States filed a verified complaint for forfeiture of defendant property; process was duly issued in this action after a finding of probable cause by the Magistrate Judge and defendant property was duly seized by the United States Marshal pursuant to said process; the Marshal served numerous persons, including all known to have or likely to claim an interest in defendant property, filed lis pendens, and published notice, fulfilling the requirements of relevant law;

2. The United States and Claimant First Citizens Bank entered into a Consent Order in which that Claimant is acknowledged as the owner of a loan secured by a deed of trust on defendant property and which provides for a payment to this Claimant from the proceeds of any sale by the Marshal pursuant to a judgment of forfeiture;

3. Leola Marsh filed a claim and answer, but no other person filed a claim or answer;

4. The United States submitted a motion for summary judgment of forfeiture against Claimant Leola Marsh and this motion was supported by affidavit and other evidence which was sufficient to carry its burden to show probable cause for forfeiture; and

5. The response of Claimant Marsh did not meet the requirements of Fed. R.Civ.P. 56(e) to raise a genuine issue of material fact and therefore the United States is entitled to judgment as a matter of law.

Based upon the above findings, IT IS, HEREBY, ORDERED, ADJUDGED AND DECREED that:

1. Judgment is hereby entered against defendant property (as defined in paragraph 4(a) of the complaint herein, which includes specific reference to deeds on file in the Mecklenburg County Registry);

2. All persons other than Claimant First Citizens Bank and Claimant Leola Marsh claiming any right, title, or interest in or to defendant property are hereby held in default;

3. The claim of Claimant Marsh is hereby dismissed;

4. Defendant property and all rights, title, and interest in or to defendant property are hereby forfeited to the Plaintiff, United States of America, and no other right, title, or interest shall exist therein except for that set forth in the Consent Order with First Citizens Bank as filed on November 22, 1991; and

5. The United States Marshal is hereby directed to dispose of the forfeited defendant property as provided by law; and

6. The counterclaims of Claimant Leola Marsh are hereby dismissed.

MEMORANDUM AND RECOMMENDATION

TAYLOR, United States Magistrate Judge.

THIS MATTER is before the undersigned Magistrate Judge on reference from the District Court pursuant to 28 U.S.C. § 636(b). Currently pending are the government's motion for summary judgment (Pleadings 52, 53) supported by two volumes of documentary exhibits (49, 50), claimant Leola Marsh's response (62), the government's reply (66), Marsh's documentary submissions (65), the government's response to Marsh's documentary submissions (67), and two more filings by Claimant (68, 69). Having fully reviewed the extensive record in this case and the pertinent authorities and conducted several hearings, the undersigned herewith enters the following Memorandum and Recommendation.

This is a civil action for the forfeiture of Leola's Plaza, a strip shopping center on West Boulevard near the intersection of Remont Road in Charlotte, N.C. The property is currently assessed for real estate taxes at about $300,000. The forfeiture was based on probable cause to believe that the property was acquired from the drug money of Leroy Ragin, who is now serving 28 years for money laundering and operating a continuing criminal enterprise (CCE)¹ in Charlotte. His aunt, Leola Marsh, is the only remaining claimant.²

The procedural history is complex;³ only that relevant to this memorandum will be described herein. The United States filed a verified complaint for the forfeiture of defendant property on August 31, 1989. The court reviewed the sworn statements of experienced FBI and IRS agents, found probable cause for the forfeiture, and issued a Warrant of Arrest In Rem for seizure of the property and for the Marshal to give lawful notice to potential claimants. It was seized on September 1, 1989, and proper notice to potential claimants was issued, personally and through newspaper publication and recording of lis pendens. All procedural requirements for forfeiture were completed.⁴ Leola Marsh timely filed a claim and an answer.

Marsh was indicted by a grand jury in this district on charges of money laundering in connection with payments for defendant property. Several months later, the United States dismissed the charges against her in connection with Leroy Ragin's plea of guilty to counts of the same indictment charging him with money laundering and operating a CCE.

The United States filed a motion for summary judgment on August 26, 1991. The motion was supported by an exhaustive memorandum of about 100 pages and two volumes of documentary exhibits (including several affidavits and numerous documents produced by Marsh and her bank in response to discovery requests). Marsh filed a response on October 31, 1991,⁵ but the response was not accompanied by any evidence. The United States filed a reply on November 7, 1991, which cited Supreme Court and numerous Fourth Circuit decisions to show that Marsh's response was inadequate under current standards for summary judgment. On the day before the hearing on the motion, Marsh filed a quantity of documents without explaining how they relate to any issue herein.⁶ The Court and the United States learned of the filing of these documents at the hearing.

The United States has met its burden to show probable cause, but Marsh's response to the motion for summary judgment has not met her burden to come forward with affirmative evidence raising a genuine issue of fact, which if proved, would prevent forfeiture. Therefore the United States is entitled to summary judgment as a matter of law.

BURDENS ON THE PARTIES

The United States is entitled to forfeiture on a finding of probable cause unless the claimant proves a defense to forfeiture by a preponderance of the evidence. United States v. $95,945.18, 913 F.2d 1106, 1110 (4th Cir.1990); United States v. One Parcel at 7715 Betsy Bruce Lane, 906 F.2d 110 (4th Cir.1990); Boas v. Smith, 786 F.2d 605, 609 (4th Cir.1986).

These burdens on the parties apply in determinations of motions for summary judgment.⁷ Fed.R.Civ.P. 56(e) requires:

Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein.... When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party.

(Emphasis added.) The "purpose of summary judgment is to `pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial.'" Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986) (quoting Advisory Committee Note to 1963 Amendment to Rule 56(e)). Matsushita is one of three 1986 cases in which the Supreme Court expanded authority for summary judgment and "made increasingly clear ... the affirmative obligation of the trial judge to prevent `factually unsupported claims and defenses' from proceeding...