Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cr-00214/USCOURTS-caed-2_06-cr-00214-5/pdf.json

Parties Involved:
Susan Michelle Pruett
Defendant
Kenneth Richard Pruett
Defendant
USA
Plaintiff

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1

McGREGOR W. SCOTT

United States Attorney

SAMANTHA S. SPANGLER

Assistant U.S. Attorney

501 I Street, Suite 10-100

Sacramento, California 95814

Telephone: (916) 554-2792

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA, )

)

Plaintiff, )

)

v. )

)

SUSAN MICHELLE PRUETT, and )

KENNETH RICHARD PRUETT, )

)

Defendants. )

______________________________)

CASE. NO. 2:06-CR-0214 LKK

EX PARTE APPLICATION FOR ORDER

REGARDING CRIMINAL FORFEITURE

OF PROPERTY IN GOVERNMENT

CUSTODY - 18 U.S.C. §

983(a)(3)(B)(ii)(II)

The United States of America, through its counsel, hereby moves

for an order allowing the government to maintain custody of property

already in the government’s possession pending the resolution of a

criminal forfeiture matter. The grounds for the motion are as

follows: 

On or about April 3, 2006, Magistrate Judge Mueller issued a

civil seizure warrant pursuant to 18 U.S.C. § 981(b) based on

probable cause for all winnings obtained by Susan Michelle Pruett

from the Video Poker Millionaire Maker tournament held on or about

March 21, 2006, by Harvey’s Tahoe Management Company Inc./Harrah’s

Operations Company Inc. up to the sum of $1,000,000.00. On or about

April 4, 2006, an agent of the Internal Revenue Service-Criminal

Investigation ("IRS") executed the above-referenced seizure warrant. 

Case 2:06-cr-00214-LKK Document 33 Filed 08/09/06 Page 1 of 4
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IRS seized the following asset on or about April 6, 2006 ("the

seized asset") for the purpose of initiating civil forfeiture

proceedings:

a) Approximately $497,953.91 in U.S. Currency.

In accordance with 18 U.S.C. § 983(a)(1), the IRS sent notice

of its intent to forfeit the seized asset in a non-judicial

forfeiture proceeding to defendants Susan Michelle Pruett and

Kenneth Richard Pruett; Lawrence Miles, Jr., who represents Cal

Worthington and his business Big W Ranch Corporation; and Kelley

Kern who represents Russell Mechanical, Inc., and caused that notice

to be published in a newspaper of general circulation. 

On or about May 9, 2006, Big W Ranch Corporation filed a claim

contesting the administrative forfeiture of the seized asset 

pursuant to 18 U.S.C. § 983(a)(2). On or about May 23, 2006,

Russell Mechanical, Inc., filed a claim contesting the

administrative forfeiture of the seized asset pursuant to 18 U.S.C.

§ 983(a)(2). On or about June 2, 2006, defendant Susan Michelle

Pruett filed a claim contesting the administrative forfeiture of the

seized asset pursuant to 18 U.S.C. § 983(a)(2). 

Pursuant to 18 U.S.C. § 983(a)(3), the United States has 90

days in which to 1) return the property to the defendant, 2)

commence a civil judicial forfeiture action, or 3) commence a

criminal forfeiture action by including the seized asset in a

criminal indictment. On August 3, 2006, the government elected the

third option when it filed a Superseding Indictment containing a

forfeiture allegation concerning the seized asset. That Superseding

Indictment is now pending in this Court.

///

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Title 18 U.S.C. § 983(a)(3)(B)(ii)(II) provides that when the

government elects the third option, it must "take the steps

necessary to preserve its right to maintain custody of the property

as provided in the applicable criminal forfeiture statute". The

applicable forfeiture statutes in this case are 18 U.S.C. §

981(a)(1)(C), 28 U.S.C. § 2461(c), and 18 U.S.C. § 982(a)(1). Title

18 U.S.C. § 982(b)(1) incorporates the forfeiture procedures set

forth in 21 U.S.C. § 853. That statute prescribes several methods

for preserving property for the purpose of criminal forfeiture. 

Section 853(f) authorizes the issuance of a criminal seizure

warrant. However, in cases like this one, where the property in

question is already in government custody, it is not appropriate for

a court to issue a seizure warrant directing the government to seize

property from itself. In turn, Section 853(e) authorizes the court

to issue a restraining order or an injunction to preserve the

property for forfeiture. However, that provision is not pertinent

because there is no need to enjoin the government from disposing of

property that the government has taken into its custody for the

purpose of forfeiture and that the government intends to preserve

for that purpose through the conclusion of the pending criminal

case.

Finally, Section 853(e)(1) also authorizes a court to "take any

other action to preserve the availability of property" subject to

forfeiture. The government contends that this provision applies in

circumstances where, as here, the government has already obtained

lawful custody of the seized asset pursuant to a federal seizure

warrant, and the government seeks to comply with Section

983(a)(3)(B)(ii)(II). Thus, all that is required to comply with

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Section 983(a)(3)(B)(ii)(II) is an order from this Court stating

that the United States and its agencies, including IRS and/or the

Department of Treasury, may continue to maintain custody of the

seized asset until the criminal case is concluded.

Accordingly, pursuant to Section 853(e)(1), the United States

respectfully moves this court to issue an order directing that the

United States may maintain custody of the seized asset through the

conclusion of the pending criminal case and stating that such order

satisfies the requirements of 18 U.S.C. § 983(a)(3)(B)(ii)(II).

DATED: August 7, 2006 McGREGOR W. SCOTT

United States Attorney

By: /s/ Samantha S. Spangler 

SAMANTHA S. SPANGLER

Assistant U.S. Attorney

ORDER

This matter comes before the Court on the motion of the United

States for an Order authorizing the government and its agencies to

maintain custody of certain property pending the conclusion of the

pending criminal case. For the reasons provided in the government’s

motion, the Court makes the following order:

IT IS HEREBY ORDERED, that the United States and its agencies,

including the IRS and/or the Department of Treasury, are authorized

to maintain and preserve the following asset until the conclusion of

the instant criminal case, or pending further Order of this Court: 

a) Approximately $497,953.91 in U.S. Currency seized on or

about April 6, 2006.

IT IS SO ORDERED.

DATED: August 8, 2006

Case 2:06-cr-00214-LKK Document 33 Filed 08/09/06 Page 4 of 4