Opinion
Case No. 00-5008-CV-SW-ODS
March 18, 2003
Pending are Plaintiffs Motion for Summary Judgment (Doc. # 120) and Claimant's Motion to Set Hearing for Proportionality Determination Based on Excessive Fines Doctrine (Doc. #131). For the following reasons, Plaintiffs motion is granted, and Claimant's motion is denied.
I. BACKGROUND
Claimant Elizandro Martinez does not controvert Plaintiffs facts in his response to Plaintiffs Motion for Summary Judgment. In accordance with Local Rule 56.1(a), "[a]ll facts set forth in the statement of the movant shall be deemed admitted for the purpose of summary judgment unless specifically controverted by the opposing party." L.R. 56.1(a). Claimant set forth his own rendition of the facts, most of which are irrelevant to the case at hand.
On May 21, 1999, agents of the Drug Enforcement Administration (DEA) seized $898,719.00 in United States currency from Charlie P. Tatum ("Tatum"). The currency was seized from a motor home driven by Tatum on the westbound lane of I-44, in Lawrence County, in the Western District of Missouri, following a traffic stop by the Missouri State Highway Patrol. During the traffic stop, Trooper McKnight observed that Tatum's eyes were bloodshot, his speech was slurred, and appeared nervous. Tatum informed Trooper McKnight that he was traveling from Pennsylvania to Arizona. Tatum told Trooper McKnight that Claimant Elizandro Martinez ("Claimant")was his boss, and Claimant had rented the motor home for Tatum to make the personal trip. Tatum told the troopers that he had left Phoenix, Arizona, on May 14, 1999.
Trooper McKnight noticed the unusually strong smell of deodorizers coming from the motor home and noticed that there were a couple deodorizers hanging from the vehicle's rearview mirror. Based on this and other observations, he asked Tatum for permission to search the motor home. Tatum consented to the search.
The troopers located a portion of the defendant currency duct-taped in a bundle and hidden in the motor home's microwave. The remainder of the defendant currency was found in a suitcase that was located underneath a bed. This suitcase was covered in duct tape and was found within a larger suitcase that was padlocked. Tatum did not have a key to the padlock; however, he told the troopers that Claimant instructed him to lock the suitcase and throw away the key and cut the lock when he needed the suitcase opened. The defendant currency was found in 172 individual bundles contained in seven packages covered in duct tape. In addition to the defendant currency, the troopers also located empty packages of duct tape, partial packages of duct tape, a large number of padlocks and two cans of spray scent.
A sniff test of the suitcase by a narcotic detection canine indicated that the suitcase and the currency had been near narcotics. Tatum then contradicted his prior statements and told the troopers that he worked for EMT Trucking (Claimant's trucking company), the currency belonged to Claimant, and Claimant had given Tatum the currency to purchase tractor-trailers. Tatum estimated that Claimant had given him about $500,000. However, EMT Trucking had ceased operations in January 1999, five months prior to the seizure of the defendant currency. In addition, this new explanation was puzzling because Tatum was traveling toward his point of origin and still had the money he was supposed to have spent.
During his interview with law enforcement, Tatum consented to a recorded telephone call to Claimant. Tatum explained to Claimant what had occurred and told him that law enforcement were trying to seize the money because they believed that it was involved in drug trafficking. Claimant asked Tatum, "[h]ow much you got, man?" Claimant agreed to speak with Sergeant Banasik and told him that Claimant gave Tatum $50,000 to purchase trucks and trucking equipment.
Claimant now alleges that he gave Tatum $800,000, which Claimant received in cash from a Mexican farming/ranching corporation, the Sociedad de Production Rural de Responsabilidad Limitada La Pasion ("La Pasion"), while Claimant was in Mexico in April 1999. Claimant argues that this money was to be used for the purchase of trucks, tractors and heavy equipment for La Pasion. La Pasion and Claimant executed a receipt and letter of instruction documenting the tendering of the $800,000 and stating that the amount was for the purchase of two Caterpillar D08's, two Caterpillar tractors, two Caterpillar backhoes, one Caterpillar front loader, one Caterpillar scraper and two ten-wheel dump trucks. In addition, Claimant claims that he personally contributed $70,000 for the purchase of trucks, trailers and heavy equipment.
Claimant alleges that $32,532.16 of his personal cash contribution was withdrawn from Wells Fargo Bank, account number 6701508319, via a Cashier's Check, number 6162005259, on October 13, 1998. He alleges that he negotiated the Cashier's Check into cash; however, the Cashier's Check was deposited into Clamant's EMT Trucking account at Wells Fargo Bank on November 6, 1998. Claimant did not withdraw that amount of cash from the EMT Trucking account prior to the seizure of the defendant currency. In addition, Michael Pope contributed $30,000 for the purchase of a truck, trailer or heavy equipment. Claimant produced a receipt showing that Pope's contribution came from the sale of a 1993 Freightliner Tractor (VIN 1FUYDSEB4PP454760) on February 17, 1999. During Pope's deposition, he verified the authenticity of the receipt and testified that it was executed at the time the tractor was sold. However, in Pope's sworn declaration filed with the Arizona Department of Transportation, Motor Vehicle Division, he stated that the above-identified tractor was sold on August 18, 1999, which is approximately three months after the defendant currency was seized.
Claimant has also been linked to a prior marijuana seizure, which occurred approximately one and one-half months prior to the seizure of the defendant currency. On April 9, 1999, law enforcement officers seized 2,101 pounds of marijuana and two firearms from a tractor-trailer driven by Manuel Alapizco ("Alapizco") on I-44 in Greene County, Missouri. The tractor-trailer was titled in the name of EMT Trucking. Alapizco testified that Claimant co-signed the promissory note for the tractor-trailer because Alapizco had bad credit and that Claimant offered Alapizco the opportunity to make money by transporting 2,101 pounds of marijuana. During his deposition on March 27, 2001, Claimant invoked his Fifth Amendment privilege with respect to all questions regarding this marijuana seizure.
The police seized the defendant currency and initiated forfeiture proceedings. The Government subsequently instituted a two-count in rem action. On February 7, 2002, Magistrate Judge James C. England issued an order finding probable cause to believe that the defendant currency was furnished or intended to be furnished in exchange for a controlled substance, is a proceed traceable to such an exchange or was used or intended to be used to facilitate the commission of a controlled substance offense.
Count One of Plaintiffs Amended Complaint alleges that the defendant currency was furnished or intended to be furnished in exchange for a controlled substance in violation of subchapter I of Chapter 13, Title 21 of the United States Code; is a proceed traceable to such an exchange; or was used or intended to be used to facilitate the commission of a violation of subchapter I of Chapter 13, Title 21 of the United States Code. Therefore, Plaintiff alleges that the defendant currency is subject to forfeiture pursuant to 21 U.S.C. § 881(a)(6).
Count Two alleges that the defendant currency constitutes "monetary instruments" in excess of $10,000, which was transported to the United States from a place outside the United States, without a report being filed. Plaintiff alleges that the failure to file a report violates 31 U.S.C. § 5316, 5324(b)(1). Therefore, Plaintiff claims that the defendant currency is subject to forfeiture pursuant to 31 U.S.C. § 5317(c).
II. PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
A. STANDARDA moving party is entitled to summary judgment on a claim only if there is a showing that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."See generally Williams v. City of St. Louis, 783 F.2d 114, 115 (8th Cir. 1986). "[W]hile the materiality determination rests on the substantive law, it is the substantive law's identification of which facts are critical and which facts are irrelevant that governs." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986): see also Get Away Club. Inc. v. Coleman, 969 F.2d 664 (8th Cir. 1992). In applying this standard, the Court must view the evidence in the light most favorable to the non-moving party, giving that party the benefit of all inferences that may be reasonably drawn from the evidence.Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 588-89 (1986); Tyler v. Harper, 744 F.2d 653, 655 (8th Cir. 1984), cert. denied, 470 U.S. 1057 (1985). However, a party opposing a motion for summary judgment "may not rest upon the mere allegations or denials of the . . . pleadings, but . . . by affidavits or as otherwise provided in [Rule 56], must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e).
B. DISCUSSION
1. Count One — Drug Violation
Federal law provides that all currency furnished in exchange for illegal drugs, all proceeds traceable to an exchange for illegal drugs and all currency used to facilitate illegal drug trafficking are subject to forfeiture. 21 U.S.C. § 881(a)(6) (2002). "The Government bears the initial burden of proving probable cause to connect the property to drug trafficking." United States v. Premises Known as 7725 Unity Ave. N., Brooklyn Park. Minn., 294 F.3d 954, 958 (8th Cir. 2002) (citations omitted); see also United States v. Ninety-One Thousand Nine Hundred Sixty Dollars ($91.960.00). 897 F.2d 1457, 1462 (8th Cir. 1990) (citations omitted). To establish probable cause, there must be more than a mere suspicion to believe the currency was used for purposes of drug trafficking. United States v. Rankin, 261 F.3d 735, 740 (8th Cir. 2001). The Court may consider circumstantial evidence and may apply "common experience considerations." United States v. Eighty-Seven Thousand Sixty Dollars ($87.060.00). 23 F.3d 1352, 1354 (8th Cir. 1994) (citations omitted); United States v. United States Currency in the Amount of One Hundred Fifty Thousand Six Hundred Sixty ($150.660.00). 908 F.2d 1200, 1206 (8th Cir. 1993) (citation omitted).
This case commenced prior to the enactment of the Civil Asset Forfeiture Reform Act of 2000 (CAFRA). Therefore, the elevated burden of proof formulated by CAFRA is not applicable to this case. See United States v. Santiago, 227 F.3d 902, 907 n. 3 (7th Cir. 2000).
In United States v. $150.660.00. the Eighth Circuit found that the purchase of a one-way train ticket with cash, possession of a large sum of case, the worn look of the currency, the smell of dry marijuana on the currency, and inconsistent statements made by the possessor of the currency supported a reasonable belief that the Government would be able to establish probable cause for forfeiture at trial. 980 F.2d at 1206-1207. Similarly, in United States v. $91.960, the Eighth Circuit found probable cause existed for forfeiture of the defendant currency when a large amount of money was concealed by torn phonebook pages in a briefcase, the briefcase contained a notebook that seemed to be a record of drug transactions, inconsistent statements were made by the possessor of the currency, the one-way airline ticket was purchased with cash, and a police dog sniff indicated that the briefcase has been near narcotics. 897 F.2d at 1463. The Eighth Circuit has also recognized that the possession of a large amount of cash "is strong evidence that the case is connected with drug trafficking."United States v. Thirty-Nine Thousand Eight Hundred Seventy-Three Dollars ($39.873.00). 80 F.3d 317, 319 (8th Cir. 1996) (citation omitted) (finding that approximately $40,000 was a large sum of cash that evinced a connection with drug trafficking).
In this case, several facts establish that the Government had probable cause to believe that the currency was connected to drug trafficking including: (1) Tatum, the driver of the motor home, appeared nervous to the trooper; (2) Tatum gave inconsistent responses regarding his purpose of travel; (3) the motor home was rented by an absent third party; (4) there was an unusually strong odor of deodorizers coming from the motor home; (5) the defendant currency was found in 172 bundles in eight packages wrapped in duct tape; (6) the packages of currency were located in a suitcase that was duct-taped and enclosed in a padlocked suitcase; (7) Tatum did not have a key to the suitcase, but he was told by Claimant to cut the padlock if he needed to open the suitcase; (8) the amount of currency discovered was almost $900,000.00; (8) there were several padlocks, empty padlock packages, partial packages of duct tape, and cans of spray scent; (9) the narcotic detection canine alerted the presence of narcotics on the suitcase and the defendant currency; (10) Tatum did not know the amount of currency he was transporting and estimated the amount to be significantly less than the amount discovered; (11) Claimant told law enforcement that Tatum had only $50,000 in his possession; and (12) Claimant was implicated in a seizure of more than two thousand pounds of marijuana one and one-half months prior to the seizure of the defendant currency. Claimant argues that the Government has not established probable cause because the nexus between the defendant currency and illegal narcotics activity solely rests on a dog sniff and Claimant's implication in a previous seizure of marijuana. Contrary to Claimant's arguments, probable cause is supported by the evidence indicated by Claimant along with additional evidence presented by the Government. In light of the case law and the sheer abundance of evidence, the Court finds that the Government has established that it had probable cause for forfeiture of the defendant currency.
After the Government makes a showing of probable cause, "the burden shifts to the claimant to show by a preponderance of the evidence that the property is not connected with drug trafficking or that some defense to forfeiture applies." 7725 Unity Ave. N. Brooklyn Park. Minn., 294 F.3d 954 at 958. In Claimant's Suggestions in Opposition to Plaintiffs Motion for Summary Judgment, Claimant does not argue that the defendant currency is not connected to drug trafficking; nonetheless, the Court has analyzed the facts of the matter to determine if Claimant has established by a preponderance of the evidence that the defendant currency is not linked to drug trafficking.
First, Claimant alleges that he personally contributed $70,000 to Tatum for the purchase of trucks, trailers and heavy equipment. Claimant alleges that $32,532.16 was withdrawn from his personal account at Wells Fargo Bank via a Cashier's Check, which he alleges that he negotiated into cash. However, the Cashier's Check was deposited into Clamant's EMT Trucking account, and Claimant never withdrew that amount of cash from that account prior to the seizure of the defendant currency.
Second, Claimant asserts that Michael Pope contributed $30,000 for the purchase of a truck, trailer or heavy equipment. Claimant produced a receipt showing that Pope's contribution came from the sale of a 1993 Freightliner Tractor on February 17, 1999, and Pope verified the authenticity of the receipt. However, in Pope's sworn declaration filed with the Arizona Department of Transportation, Motor Vehicle Division, he stated that the tractor was sold on August 18, 1999, which is several months after the defendant currency was seized.
Finally, Claimant alleges that he gave Tatum $800,000, which he received in cash from a Mexican farming/ranching corporation for the purchase of trucks, tractors and heavy equipment. According to a document produced along with Claimant's Third Supplemental Response to Plaintiffs First Request for Production of Documents, Claimant and the Mexican corporation executed a receipt and letter of instruction documenting the tendering of the $800,000 for the purchase of certain heavy equipment. However, when asked by law enforcement officers how much money was in Tatum's possession, Claimant answered that approximately $50,000 was in Tatum's possession.
Claimant has provided the Court with three bases to explain why the defendant currency is not connected to drug trafficking activity. However, due to the inconsistencies found within all of the reasons provided by Claimant, Claimant cannot establish by a preponderance of the evidence that the defendant currency is not connected to drug trafficking activity. For the foregoing reasons, the Plaintiff's Motion for Summary Judgment is granted with respect to Count One of the Amended Complaint.
2. Count Two — CMIR Violation
Any person transporting in excess of $10,000 in currency from a place outside the United States to a place in the United States is required to file a Currency or Monetary Instrument Report (CMIR) with the Secretary of the Treasury. 31 U.S.C. § 5316 (2003). Currency transported into the United States in violation of the reporting requirement is subject to forfeiture. 31 U.S.C. § 5317(c) (2003).
Claimant argues that he obtained $800,000 of the defendant currency from a Mexican farming/ranching corporation while he was in Nogales, Mexico, on April 25, 1999. Claimant then transported the currency into the United States. Claimant did not file a Currency or Monetary Instrument Report (CMIR) with regard to his $800,000 in cash, and thus has violated 31 U.S.C. § 5316.
Claimant concedes the forfeiture allegation in Count Two, but requests relief pursuant to United States v. Bajakajian, 524 U.S. 321 (1998), claiming that forfeiture of the defendant currency would be grossly disproportionate to the gravity of any reporting infraction, therefore, violating the Excessive Fines Doctrine of the Eighth Amendment. In Bajakajian, the Court held that when the sole criminal violation giving rise to the forfeiture of the defendant currency being transported into the United States is the failure to declare the full amount of the currency and there is no nexus to other illegal activity, forfeiture of the full amount would constitute a violation fo the Excessive Fines Doctrine of the Eighth Amendment. 524 U.S. at 337-38 (finding that full forfeiture of Bajakajian's money would violate the Excessive Fines Doctrine because the money was not connected to any other crime and Bajakajian was transporting the money outside the United States to repay a lawful debt).
As explained above, Plaintiff has demonstrated probable cause to believe that the defendant currency is the proceeds of drug trafficking activity or was used or intended to be used to purchase drugs. UnlikeBajakajian, the forfeiture of the defendant currency results from the failure to declare the amount of currency and a nexus exists between the defendant currency and an illegal activity. Therefore, full forfeiture of the defendant currency is not disproportionate to the gravity of the underlying drug offense. For the foregoing reasons, the Plaintiffs Motion for Summary Judgment is granted in regard to Count Two of the Amended Complaint. In addition, Claimant's motion for a hearing to determine proportionality of the forfeiture based on the Excessive Fines Doctrine is denied because Bajakajian does not apply to this case.
III. CONCLUSION
In conclusion, Plaintiffs Motion for Summary Judgment is GRANTED, and Claimant's Motion to Set a Hearing for a Proportionality Determination Based on the Excessive Fines Doctrine is DENIED.
IT IS SO ORDERED.