Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_09-cv-08096/USCOURTS-azd-3_09-cv-08096-1/pdf.json

Nature of Suit Code: 625
Nature of Suit: Drug Related Seizure of Property
Cause of Action: 21:881 Forfeiture Property-Drugs

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

United States of America, 

Plaintiff, 

vs.

$133,420.00 in U.S. Currency, 

Defendant. 

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No. CV-09-8096-PCT-NVW

ORDER

Before the Court are Claimant Damon Louis’ Motion to Suppress (doc. # 22), the

Government’s Motion to Strike Claim and Answer of Damon J. Louis (doc. # 27), the

Government’s Motion to Stay Louis’ Motion to Suppress (doc. # 29), Louis’ Motion for

Summary Judgment (doc. # 42), Louis’ Motion to File Supplemental Memorandum (doc.

# 53) and the Government’s Motion to Strike Louis’ Discovery Responses (doc. # 79).

I. Facts

On January 6, 2009, Officer Mace Craft of the Arizona Department of Public

Safety stopped a white 2009 Buick driven by Claimant Damon Louis on the westbound

Interstate 40 in Arizona. When prompted, Louis produced a California driver’s license

and a rental agreement indicating he had rented the vehicle from Avis Car Rental in San

Francisco, California, on January 2, 2009. The vehicle was due to be returned on January

9, 2009. 

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Officer Craft asked Louis where he was traveling from and why he did not fly. 

Louis responded that he had visited Albuquerque for a friend’s wedding and had driven

with a friend who remained there. When Officer Craft inquired about the wedding, Louis

explained that the wedding was in fact a month ago and that he had returned to

Albuquerque for the ceremony. Officer Craft eventually completed a traffic warning and

provided Louis with a copy. He then asked whether there was anything illegal in the

vehicle, to which Louis responded no. Louis also twice denied having any large amounts

of U.S. currency in the vehicle. 

Another officer who had arrived on the scene subsequently conducted a pat-down

of Louis’ person, which revealed two cell phones. Although the parties dispute whether

Louis consented to a search of his vehicle or to a canine drug detection sniff, Officer

Craft at some point directed his canine to sniff the exterior of the vehicle. When the

canine alerted, Officer Craft informed Louis that he had probable cause to search the

vehicle and again asked if there was anything illegal inside. Louis said no. A search of

the trunk revealed three cardboard boxes, two of which contained large decorative rocks. 

The third box contained a plastic grocery bag and a black box labeled “Black Jet

Throwing Dagger Triple Set”. The grocery bag contained three zip-lock bags of U.S.

currency totaling $133,420.00. Officer Craft subsequently placed Louis in handcuffs. A

search of Louis’ person revealed a receipt, dated January 6, 2009, for the purchase of the

set of throwing daggers found in the third box. Louis was thereafter escorted to the

Arizona Department of Public Safety in Flagstaff, Arizona.

Upon arrival, two detectives advised Louis of his Miranda rights and conducted an

interview, a digital video recording of which Louis has submitted as an exhibit. During

the interview, Louis explained that after he rented the 2009 Buick in San Francisco,

California, he drove to Denver, Colorado, and was on his way back to San Francisco

when Officer Craft stopped him. He also stated that he knew the currency was in the

trunk of the vehicle because he had put it there, but denied any knowledge of the amount

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Louis denies admitting at the interview that he is not the owner of the currency, but

the recording of the interview very clearly indicates otherwise. At one point, one of the

detectives said, “You’ve made a statement–the money’s not yours, I’m assuming the money’s

not yours?” Louis unmistakably shook his head and responded, “No.”

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of the currency. He also admitted that the currency was not his.1

 At the conclusion of the

interview, Louis was invited to sign a DPS “Disclaimer of Ownership of Currency or

Property” form, but declined to do so without first consulting an attorney. He was

subsequently released and advised that he was free to leave. His vehicle was returned,

but law enforcement retained the two cell phones and the currency.

On March 9, 2009, Louis filed a claim for the defendant currency with the Drug

Enforcement Administration. The Government initiated this in rem civil forfeiture

proceeding on June 5, 2009, alleging that the currency is subject to forfeiture pursuant to

both 18 U.S.C. § 981(a)(1)(C) and 21 U.S.C. § 881(a)(6) as proceeds traceable to

controlled substance offenses. In August 2009, Louis filed a claim and answer contesting

the forfeiture. The claim alleges that Louis has “an ownership and/or a possessory

interest in, and the right to exercise dominion and control over, all or part of the defendant

property.” (Doc. # 14.) 

On October 5, 2009, the Government propounded special interrogatories pursuant

to Rule G(6) of the Supplemental Rules for Certain Admiralty or Maritime Claims and

Asset Forfeiture Actions, which allows the Government to serve interrogatories limited to

“the claimant’s identity and relationship to the defendant property without the court’s

leave at any time after the claim is filed and before discovery is closed.” Interrogatory 2

requested the following information:

State the extent and describe with particularity the nature of your interest in the

defendant currency, and identify how you acquired that interest. Your answer

should include, but not be limited to, the following:

(a) The date(s), time, place and manner in which the defendant currency

was obtained, including the names, address and telephone numbers of the

person(s) from whom the currency was obtained.

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(b) The circumstances of each transaction by which you acquired or

obtained any interest in the defendant currency.

(c) The reason(s) the defendant currency was obtained, and witnesses,

including the names, addresses, and telephone numbers of such witnesses, to

any of the transactions by which the defendant currency was obtained. . . . 

Louis objected to the request on various grounds, including his Fifth Amendment right

against self-incrimination and his Fourth Amendment rights against unreasonable

searches and seizures, but ultimately provided the following limited response: “Without

waiving said objections, my interest in the defendant property is as the owner and

possessor of said property, with a right to exercise dominion and control over said

property.” His responses to the other interrogatories were similarly conclusory and

incomplete. While Louis willingly responded to the Government’s inquiries into the type

of property interest he asserted, he repeatedly declined, on Fifth Amendment selfincrimination grounds, to identify how, why, or where he obtained the currency. 

On January 14, 2010, Louis filed a motion to suppress (doc. # 22), seeking, in part,

suppression of the statements he made during his interview on January 6, 2009, as fruits

of the allegedly unlawful seizure and search of his vehicle. The Government responded

by filing a motion to strike Louis’ claim and answer for lack of standing (doc. # 27) and a

motion to stay consideration of the motion to suppress pending resolution of the standing

issue (doc. # 29). The Government has also moved to strike Louis’ responses to the

special interrogatories on grounds of improper use of the Fifth Amendment privilege

against self-incrimination (doc. # 79).

II. Analysis

A. Motion to Stay

In its motion to stay, the Government contends that the issue of standing must be

resolved before Louis’ motion to suppress is considered. Louis, on the other hand, argues

that because the motion to suppress seeks, in part, suppression of statements he made to

law enforcement officers regarding his relationship to the defendant currency, and

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because those statements inform the standing inquiry, the Court should resolve the motion

to suppress before addressing standing. 

Other courts have required claimants to establish Article III standing as a

prerequisite to bringing a motion to suppress in a forfeiture proceeding. See United States

v. $ 1,185,135.00 in U.S. Currency, 320 Fed. Appx. 893, 894 (11th Cir. 2008) (noting that

a claimant must establish standing to challenge the forfeiture proceeding in order to raise

a suppression claim); United States v. $ 321,470.00, U.S. Currency, 874 F.2d 298, 300

(5th Cir. 1989) (affirming the district court’s finding that the claimant’s lack of Article III

standing mooted his motion to suppress); United States v. $ 543,190.00 in U.S. Currency,

535 F. Supp. 2d 1238, 1248 (M.D. Ala. 2008) (addressing standing to contest the

forfeiture before addressing the lawfulness of the seizure). However, the order in which

the motions may be considered need not be decided in this case because, as explained

below, Louis has failed to establish standing even without considering the statements he

seeks to suppress.

B. Standing

The Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), 18 U.S.C. § 983,

governs all in rem civil forfeiture proceedings commenced on or after August 23, 2000. 

See United States v. Approximately $1.67 Million in United States Currency, 513 F.3d

991, 998 (9th Cir. 2008). Those forfeiture proceedings are also governed by the

Supplemental Rules for Certain Admiralty or Maritime Claims and Asset Forfeiture

Actions. See 18 U.S.C. § 983(a)(4)(A); United States v. $ 100,348.00 in U.S. Currency,

354 F.3d 1110, 1117 (9th Cir. 2004). 

Supplemental Rule G, effective in 2006, permits any person claiming an interest in

the property to contest the forfeiture by filing a claim in the court where the action is

pending. Supp. R. Certain Adm. & Mar. Cl. G(5)(a)(i). At any time after the claim is

filed and before the close of discovery, the Government “may serve special

interrogatories limited to the claimant’s identity and relationship to the defendant

property . . . .” Id. at G(6)(a). Furthermore, the Government may move to strike the

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In its Reply, the Government argues for the first time that Louis also lacks prudential

standing. The Court finds it unnecessary to address that issue. Therefore, Louis’ motion to

file a supplemental memorandum addressing prudential standing will be denied.

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claim for lack of standing at any time before trial. Id. at G(8)(c)(i)(B). The motion to

strike “may be presented as a motion for judgment on the pleadings or as a motion to

determine after a hearing or by summary judgment whether the claimant can carry the

burden of establishing standing by a preponderance of the evidence.” Id. at

G(8)(c)(ii)(B). As further explained by the 2006 Advisory Committee Notes to

Supplemental Rule G(8)(c)(ii)(B):

If a claim fails on its face to show facts that support claim standing, the claim

can be dismissed by judgment on the pleadings. If the claim shows facts that

would support claim standing, those facts can be tested by a motion for

summary judgment. If material facts are disputed, precluding a grant of

summary judgment, the court may hold an evidentiary hearing. The evidentiary

hearing is held by the court without a jury. The claimant has the burden to

establish claim standing at a hearing; procedure on a government summary

judgment motion reflects this allocation of the burden.

Here, the Government has presented its motion to strike as a motion for summary

judgment, accompanied by Louis’ responses to the Government’s Supplemental Rule

G(6) special interrogatories. The Government argues that Louis lacks both Article III and

statutory standing.2

 Statutory standing ensures the claimant has complied with the

procedural requirements of 18 U.S.C. § 983(a)(4)(A) and the Supplemental Rules for

Certain Admiralty and Maritime Claims. United States v. $ 114,031.00 in U.S. Currency,

284 Fed. Appx. 754, 756 (11th Cir. 2008); United States v. $ 487,825.00 in United States

Currency, 484 F.3d 662, 664 (3d Cir. 2007). Because Louis’ procedural compliance

remains unchallenged, the Court need address only Article III standing.

A claimant bears the burden of establishing Article III standing, the threshold

function of which is “to ensure that the government is put to its proof only where

someone with a legitimate interest contests the forfeiture.” United States v. $ 557,933.89,

More or Less, in U.S. Funds, 287 F.3d 66, 79 (2d Cir. 2002). A claimant must therefore

demonstrate that he or she has “a sufficient interest in the property to create a case or

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controversy.” United States v. Real Property Located at 475 Martin Lane, 545 F.3d 1134,

1140 (9th Cir. 2008). Because standing requirements “are not mere pleading

requirements” but rather an “indispensable part” of a case, standing must be supported

“with the manner and degree of evidence required at the successive stages of the

litigation.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). Therefore, while

general allegations are sufficient at the pleading stage, they are no longer sufficient at the

summary judgment and trial stages when some evidence of standing is required. Id.

An oft-cited Ninth Circuit case discussing standing requirements in the context of

civil forfeiture proceedings is United States v. $ 191,910.00 in U.S. Currency, 16 F.3d

1051, 1058 (9th Cir. 1994). There, in reviewing the denial of a motion to dismiss for lack

of standing, the Ninth Circuit explained that “to contest a forfeiture, a claimant need only

have some type of property interest in the forfeited items,” including an ownership or

possessory interest. Id. at 1057. The court went on to extrapolate several principles of

standing from other cases, concluding:

As an initial matter, a simple claim of ownership will be sufficient to create

standing to challenge a forfeiture. Mere unexplained possession will not be

sufficient. However, where a claimant asserts a possessory interest and

provides some explanation of it (e.g., that he is holding the item for a friend),

he will have standing.

Id. at 1058 (emphasis in original). Because the claimant in $ 191,910.00 claimed to own

some of the money seized from his possession and explained that he was carrying the rest

for a client, standing was satisfied. Id. 

That $ 191,910.00 was decided prior to the enactment of both CAFRA and

Supplemental Rule G raises a number of uncertainties. For one, it is unclear whether

CAFRA and Supplemental Rule G worked a substantive change to pre-existing case law

on standing requirements in civil forfeiture proceedings. The parties have been unable to

point to, and the Court has been unable to find, anything in either CAFRA or

Supplemental Rule G indicating as much. It appears that CAFRA and Supplemental Rule

G merely clarify the procedural vehicles the Government may use to challenge a

claimant’s standing. 

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Even assuming $ 191,910.00 remains good law, more uncertainty abounds. 

Because there is no discussion in $ 191,910.00 of the principle that standing must be

established with the requisite degree of proof required at successive stages of the

litigation, it is unclear whether the general principles of standing espoused in the decision

apply only to the pleading stage or also to the summary judgment and trial stages. As a

practical matter, the distinction has no bearing on whether Louis’ claimed possessory

interest in the currency is sufficient because he has provided no explanation of his

possession whatsoever. $ 191,910.00 is clear that mere unexplained possession is

inadequate to establish standing. The distinction is important, however, insofar as Louis’

claim of ownership is concerned because a simple claim of ownership is sufficient under

$ 191,910.00. Whether it is adequate here turns on whether the principles of standing in $

191,910.00 apply to the summary judgment stage.

A recent Ninth Circuit decision, relying on $ 191,910.00 as authority for what is

required to satisfy standing specifically “at the motion to dismiss stage,” appears to have

confined the applicability of $ 191,910.00 to the pleading stage. Real Property Located

at 475 Martin Lane, 545 F.3d at 1140. At least one district court has done the same in an

attempt to harmonize $ 191,910.00, which may be read to say that a mere allegation of

ownership is sufficient to establish standing, with other seemingly conflicting Ninth

Circuit authority. See United States v. $ 57,790.00 in U.S. Currency, 263 F. Supp. 2d

1239, 1241-42 (S.D. Cal. 2003) (reconciling $ 191,910.00 with United States v. Real

Property Located at Section 18, 976 F.2d 515, 520 (9th Cir. 1991) (requiring claimant to

establish standing by a preponderance of the evidence)). 

There is good reason to limit $ 191,910.00 to the pleading stage. For one, Lujan

unequivocally states that something more than a mere allegation is necessary to support

standing at the summary judgment and trial stages. 504 U.S. at 561. For another, as

recognized by the district court in $ 57,790.00, if mere allegations were enough at the

summary judgment and trial stages, it would be impossible, as a practical matter, for the

Government to challenge illegitimate claims of ownership. 263 F. Supp. 2d at 1244. 

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The above concerns are implicit in a recent Tenth Circuit discussion of standing

requirements at the summary judgment stage of a forfeiture proceeding. See United

States v. $ 148,840.00 in United States Currency, 521 F.3d 1268 (10th Cir. 2008). There,

the court relied extensively on $ 191,910.00 but also acknowledged the principle that a

claimant “bears the burden of establishing his own constitutional standing at all stages in

the litigation.” Id. at 1273. Reconciling the two, the court held that on summary

judgment, a person claiming an ownership interest establishes standing by producing an

evidentiary assertion of ownership in conjunction with some other corroborating evidence

of ownership, for example, actual possession of the res at the time it was seized. Id. at

1275. There was enough evidence of standing to deny summary judgment because the

claimant offered his deposition testimony that he owned the currency as well as the

undisputed fact that the currency was seized from the vehicle he was driving. Id. at 1277.

However, the Tenth Circuit noted in dictum that the case would be very different

“if the district court had exercised its discretion to strike [the claimant’s] claim of

ownership to the currency in light of his repeated invocations of the Fifth Amendment

privilege.” Id. at 1277 (emphasis in original). In civil cases, the Fifth Amendment

privilege against self-incrimination cannot be used as both a shield and a sword, discarded

“for the limited purpose of making statements to support a summary judgment motion”

but invoked to shield those statements from further scrutiny. In re Edmond, 934 F.2d

1304, 1308 (4th Cir. 1991). A witness’ testimony may therefore be stricken if he or she

invokes the Fifth Amendment in response to further questioning about the subject of the

testimony. Id. at 1308-09 (striking party’s affidavit on summary judgment because he

refused to submit to a deposition on Fifth Amendment grounds); United States v. Parcels

of Land, 903 F.2d 36, 43 (1st Cir. 1990) (finding the district court “had ample authority”

to strike party’s affidavit after he refused to answer deposition questions about the subject

of the affidavit testimony on Fifth Amendment grounds). Because the claimant in $

148,840.00 repeatedly asserted, at his deposition, that he owned the seized currency but

invoked the Fifth Amendment privilege in response to specific questions about the source

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Louis argues that the presence of a set of throwing daggers in the same box as that

containing the currency and the fact that a receipt for its purchase was found on Louis’

person is additional evidence of ownership. The Court is not persuaded. While the receipt

is evidence that he owns the set of daggers, it adds nothing to the circumstance that the

money was in the trunk of his car.

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of the money and why he was transporting it, the testimony could have been stricken. 

521 F.3d at 1272, 1277. However, because it was not stricken, the district court “was

obliged to accept [the] claim of ownership in determining whether [the claimant] had met

his burden of proving standing by a preponderance of the evidence.” Id. at 1277.

In this case, Louis’ assertion of ownership in his responses to the Government’s

special interrogatories together with the fact that the currency was seized from the car he

was driving would be enough to establish standing under $ 148,840.00. However, as the

Government points out in its motion to strike Louis’ discovery responses, Louis

responded to the Government’s special interrogatories only where advantageous to his

cause. He conclusorily claimed an ownership interest in response to the Government’s

inquiries into the nature of his property interest in the currency, but declined, on Fifth

Amendment self-incrimination grounds, to respond to follow-up questions about the

details of that ownership interest, including how, why, or where he obtained the funds. 

Louis’ invocation of the Fifth Amendment is therefore indistinguishable from that of the

claimant in $ 148,840.00 and is a clear example of the impermissible use of the privilege

as both a shield and a sword. Louis cannot be permitted to respond where it benefits his

standing position yet shield that response from further scrutiny, thereby using the Fifth

Amendment privilege “to mutilate the truth.” Parcels of Land, 903 F.2d at 43.

The Court will therefore exercise its discretion to strike Louis’ interrogatory

responses and therefore his evidentiary assertion of ownership. What remains is the

undisputed fact that Louis was in physical possession of the currency when it was seized.3

Louis has provided no explanation of that possession. Mere unexplained possession is

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insufficient for standing at any stage of the proceeding. See $ 191,910.00 in U.S.

Currency, 16 F.3d at 1058; $ 148,840.00 in United States Currency, 521 F.3d at 1275-76.

The Court is mindful that the rules of decision proposed by both sides in this case

are open to abuse. On the one hand, striking standing on bare claims of ownership hidden

behind Fifth Amendment silence, at the summary judgment stage where actual evidence

is needed, spares the Government from litigation from those who will never prove their

ownership. Were it otherwise, mere drug couriers could challenge forfeiture of their

cargoes. The Court finds no direct authority that courier’s title alone suffices for standing

when the claimant must go beyond pleadings to evidence. On the other hand, this rule can

occasionally allow the Government to profit from its own illegal searches and seizures by

shielding them from scrutiny. Such a result would be troubling where a claimant who is

in fact the true owner of the res declines to explain his interest because it may appear to

incriminate him, whether he is guilty of a crime or not. The Fifth Amendment protects

the innocent and the guilty alike.

On balance, the recently-enacted Supplemental Rule G appears to tip the scale in

favor of the Government’s interest in not defending against claims without minimal

evidence of standing. It does so by allowing the Government to propound special

interrogatories and to challenge a claimant’s standing by summary judgment early in the

proceeding. See Supp. R. Certain Adm. & Mar. Cl. G(6)(a), (8)(c)(ii)(B). In the event

disputed issues of material fact preclude summary judgment, the Court may evaluate

standing by a preponderance of the evidence at an evidentiary hearing without a jury. See

2006 Advisory Committee Notes to Supp. R. Certain Adm. & Mar. Cl. G(8)(c)(ii)(B). 

What is clear from Supplemental Rule G is that upon proper motion, claimants must now

produce evidence to support their claimed interest in the res. This Court is not free to reweigh the balance struck by Rule G. Louis’ claim is therefore stricken. It remains for the

Government to file a proper motion for judgment.

IT IS THEREFORE ORDERED that the Government’s Motion to Strike Louis’

Discovery Responses (doc. # 79) is granted. 

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IT IS FURTHER ORDERED that the Government’s Motion to Strike Louis’

Claim and Answer (doc. # 27) is granted.

IT IS FURTHER ORDERED that Claimant Damon Louis’ Motion to Suppress

(doc. # 22) is denied for lack of standing.

IT IS FURTHER ORDERED that the Government’s Motion to Stay Louis’

Motion to Suppress (doc. # 29) is denied as moot. 

IT IS FURTHER ORDERED that Louis’ Motion for Summary Judgment (doc. #

42) is denied for lack of standing.

IT IS FURTHER ORDERED that Louis’ Motion to File Supplemental

Memorandum (doc. # 53) is denied as moot.

Dated: June 23, 2010.

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