## United States Court of App eals

F O R T H E E I G H T H C I R C U I T

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No. 1 1- 19 89

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Uni te d S ta te s o f Am eri ca, *

*
Pl ai nt iff /Ap pe ll ee, *

*

v. * App eal fro m th e Uni te d S ta te s

* Dis tri ct Co ur t fo r th e Ro be rt De an W hi te
, * Dis tri ct of M in ne so ta

. * Defen da nt
, *

*
Ro byn W hi te
, *

*
Pet it io ne r/Ap pe ll an t. *

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Su bm it te d: Nov em

be r 18 , 20 11 Fi le d: Apr il 2, 2 01 2

__ __ __ __ __ _

Befo re WOL LMAN, MURPHY, an d B ENTON, Ci rcu it Ju dg es

.

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W OLLMAN, Circ ui t J ud ge

.

Ro byn W hi te (Whit e) ap pe a l s t h e di st ric t co ur t’s di sm is sa l of he r pe ti ti on 1

se ek in g ha lf th e pr oc eed s o f t h e s a l e of st oc k th at was or de red fo rfei te d in he r ex

hu sb an d’s co nv ic ti on fo r m ai l frau d an d m on ey la un de rin g in co nn ect i o n w i th th e

The Hon or ab le Ri ch ard H. Ky le

, Uni te d St at es Dis tri ct Ju dg e fo r th e Dis tri ct 1
of Mi nn es ot a.Tho m as Pet te rs Po n z i s c h em e. W e co nc lu de th at W hi te do es no t al le ge a le ga l

in te res t in th e st oc k pr oc eed s su ffi ci en t to co nf er st an di ng , an d th at
, ev en if sh e di d,

he r pe ti ti on fai ls on th e m eri ts . Accor di ng ly, we affi rm

.

I.

Ro be rt Dean W hi te (Defe nd a n t ) f o un de d ZINK Im ag in g, LLC (ZINK) in 2

20 05

. Bet ween ap pr ox im at el y Octo be r 24 , 20 05 , and Jan ua ry 19 , 2 00 6, Defen da nt

in ve st ed $2 ,55 0,0 00 in ZINK. Mo nt hs la te r, in Sep te m be r 20 06

, W hi te was hi red as 3

a m ark et in g co ns ul ta nt fo r ZINK. Afte r b e g i n n i ng a ro m an ti c rel at io ns hi p wit h

Defen da nt in Ja nu a r y 2 0 07

, W hi te no lo ng er rece iv ed co m pe ns at io n fo r he r wor k.

Sh e al le ge s th at sh e co nt in ue d wor ki ng fo r th e co m pa ny be cau se Defen da nt or al ly

ag reed to gi ve he r on e-h al f th e in crea se in va lu e of hi s sh ares of ZINK st oc k. W hi te

an d Def en da nt were m arri ed on Feb ru ary 22 , 20 08

.

The Fed eral Bu reau of In ve st ig at io n (FBI ) co nd uc te d a rai d of Tho m as Pet te rs ’

en te rp ris es in Sep te m

be r 20 08, an d W

hit e ceas ed wor ki ng fo r ZINK th at sa m e m on th

. On Octo be r 8, 20 08

, Defen da nt pl ed gu il ty to on e co un t of m ai l frau d an d on e co un t

of m on ey la un de rin g fo r hi s ro le in th e Pet te rs sc he m e. Defen da nt ’s en ti re in ve st m en t

in ZINK was tra ced by a FBI fo ren si c acco un ta nt to tra ns fers fro m Pet te rs Co m pa ny,

In c. (PCI ). Defen da nt ad m it te d in hi s pl ea ag reem en t th at al l fu nd s he rece iv ed fro m
PCI were pr oc eed s of th e Pet te rs frau d. Defen da nt fu rth er ad m i t t e d th at th e frau d

sp an ne d m or e th an th irt een y ears , du rin g whi ch ti m e he fab ric at ed do cu m en ts fo r th e

pu rp os e o f de frau di ng th ird pa rti es in to lo an in g P CI b il li on s o f do ll ars

.

In 20 07 , ZINK Im ag in g, LLC m erg ed in to ZINK Im ag in g, In c. 2

In A u gu st 20 07

, ZINK un de rwen t a reca pi ta li zat io n. The reca pi ta li zat io n 3

ag reem en t st at ed th at Defen da nt ’s in ve st m en ts in ZINK were de em ed to be in

ex ch an ge for hi s s ha res of ZINK s to ck

.

-2

-Defen da nt tra ns ferr ed hi s ZINK st oc k to hi s co un se l, Jo e Fri ed be rg , “ at ab ou t

th e ti m e of th e se arch warra nt rai d o n P et te rs Co m pa ny.” Ro be rt W hi te Dep . 6 1: 9-

64 :1 9. Sh or tl y aft er ta ki ng co nt ro l of th e ZINK st oc k, Fri ed be rg rece iv ed an of fer of
$3 m il li on fo r th e st oc k. ZINK’ s ch ie f ex ecu ti ve of fic er to ld Fri ed be rg th at if he so ld

th e st oc k wit hi n th e ne xt fo ur or fiv e da y s, th e pu rch as er wou ld lo an ZI N K a n
ad di ti on al $5 m il li on ne ed ed to ke ep th e co m pa ny op erat in g. Fri ed be rg th en so ld th e

st oc k fo r $3 m il l i o n a n d tra ns ferr ed th e pr oc eed s to th e Rec ei ve r in th e Pet te rs
ba nk ru pt cy

pro ceed in g.

On Sep te m

be r 13

, 20 10

, th e di st ric t co ur t or de red th at al l of Defen da nt ’s

pr op ert y de riv ed fro m or tra ceab le to th e frau d be fo rfei te d to th e Uni te d St at es

. On

or ab ou t Sep te m

be r 20

, 20 10

, W hi te fil ed fo r di vo rce fro m Defen da nt

. In th e di vo rce

pr oc eed i n g , Wh i t e so ug ht an award of on e-h al f th e pr oc eed s of th e ZINK st oc k, 4

al le gi ng th at th e p ro ceed s wer e m ari ta l p ro pe rty un de r Mi nn es ot a la w.

On Octo be r 13

, 20 10

, fo ll owi ng th e en try of a pr el im in ary or de r of fo rfei tu re,
whi ch di d no t sp eci fic al ly fo rfei t th e ZINK st oc k, Wh i t e f il ed he r in it ia l fo rfei tu re

pe ti ti on , in whi ch sh e cl ai m ed a m ari ta l in te res t an d “ an in te res t si m il ar to a qu an tu m

m eru it cl ai m ” in th e fo rfei te d pr oc eed s of th e ZINK st oc k. The pa rti es ag reed to st ay
th e d is tri ct co ur t’s co ns id erat io n o f W hi te ’s in it ia l p et it io n b ecau se th e ZINK st oc k

ha d n ot y et be en sp eci fic al ly forfe it ed

.

On Ja nu ary 6, 20 11

, th e di st ric t co ur t en te red an or de r fo rfei ti ng th e $3 m il li on
in pr oc eed s fr o m th e sa le of th e ZINK st oc k. The di st ric t co ur t co nc lu de d th at th e

go ve rn m en t ha d es tabli she d th e req ui si te ne xu s be twee n th e frau d an d th e ZINK st oc k

pr oc eed s to su pp or t a de t erm in at io n th at th e pr op ert y was fo rfei ta bl e to th e Uni te d

St at es

. The reaf

te r, W hi te fil ed an am en de d th ird -p art y pe ti ti on , ag ai n se ek in g ha lf th e

W e no te th at W hi te se ek s ha lf th e pr oc eed s fro m th e sa le of ZINK st oc k 4
in st ead of h al f th e in crea se in va lu e o f th e st oc k, as all eg ed ly pro m is ed

.

-3

-pr oc eed s of th e sa le of st oc k in ZINK. W hi te al le ge d in he r am en de d pe ti ti on bo th

a m ari ta l an d a co nt ract ua l in te res t in th e ZINK st oc k pr oc eed s. W hi te al so cl ai m ed 5

th at th e di st ric t co ur t ha d erro ne ou sl y fo rfei te d th e ZINK st oc k pr oc eed s, al le gi ng th at

“ th ere is no ne xu s be tw e e n ” th e st oc k an d “ th e cri m in al act iv it y up on whi ch [Defe nd an t] was co nv ic te d.” Am en de d P et . 2-3

.

On Apr il 5, 20 11

, th e Hen ne pi n Co un ty Dis tri ct Co ur t en te red a jud gm en t an d

de cree in th e W hi te s’ di vo rce pro ceed in g. The or de r ad op te d a st ip ul at io n bet ween
W hi te an d Defen da nt th at award ed W hi te on e-h al f th e pr oc eed s fro m th e sa le of th e
ZINK st oc k. On Apr il 19

, 20 11

, th e fed eral di st ric t co ur t di sm is se d W hi te ’s pe ti ti on , fin di ng th at W hi te co ul d n ot ch al le ng e th e fo rfei tu re, th at W hi te la ck ed st an di ng to

c la im a po rti on of th e ZINK pr oc eed s, an d th at ev en if sh e ha d st an di ng , Wh i t e ’s

pe t i t i o n f ai le d on th e m eri ts

. Bec au se th e di vo rce de cree was en te red aft er bo th of

W hi te ’s pe ti ti on s were fil ed

, th e di st ric t co ur t di d no t co ns id er th e de cree in it s or de r.
On ap pe al

, W hi te arg ue s th at sh e ha s a rig ht to ch al le ng e th e fo rfei tu re, tha t sh e ha s

st an di ng , and th at sh e is a bo na fid e p ur ch as er fo r va lu e o f th e ZINK st oc k.

II.

W e rev ie w de no vo a di st ric t co ur t’s g ran t o f a m ot io n to di sm is s a f or fei tu re

pe ti ti on

. See Cen t. Plat te Natu ral Res

. Dis t. v. U.S. Dep t. of Agr ic

., 64 3 F.3d 11 42

, 11 48 (8 th Ci r. 20 11 ). Fed eral Ru le of Cri m in al Pro ced ur e 32 .2(c )(1 )(A) aut ho riz es
th e di sm is sa l of a fo rfei tu re pe ti ti on “ fo r la ck of st an di ng , fo r fai lu re to st at e a cl ai m ,

W hi te ’s am en de d pe ti ti on al le ge d fo ur in te res ts in th e pr oc eed s of th e st oc k: 5 (1 ) be ne fic ia l an d de fa ct o own ers hi p o f on e-h al f of Defen da nt ’s ZINK st oc k; (2 ) a

m ari ta l in te res t ; (3 ) “ an in te res t si m il ar to qu an tu m mer ui t ;” an d (4 ) an or al

c o n t r a ct ua l in te res t. W hi te di d no t br ie f he r cl ai m s of de fa ct o own ers hi p an d

qu an tu m meru it , and so we co ns id er o nl y he r m ari ta l an d c on tra ct ua l i nt eres t i n t he

pr oc eed s of th e ZINK st oc k. See Carr ah e r v. Targ et Co rp ., 50 3 F.3 d 71 4, 71 6 n.2 (8 th Cir . 20 07 ).

-4

-or fo r an y ot he r la wfu l reas on .” Fo r th e pu rp os es of th e m ot io n to di sm is s, th e fact s

se t fo rth in th e pe ti ti on are as su m ed to be tru e. Id

. “ If a th ird pa rty fai ls to al le ge in

it s p et it io n al l el em en ts ne ces sa ry fo r reco ve ry , i nc lu di ng th os e rel at ed to st an di ng , th e co ur t m ay di sm i s s t h e p e ti ti on wit ho ut pr ov id in g a he ari ng .” Uni te d St at es v.
BCC I Hol di ng s (Lux em

bo ur g) S.A. (Pet it io ns of Gen eral Cred it or s)

, 91 9 F. Su pp

. 31

, 36 (D

. D

. C

. 1 9 9 6) (q uo te d wit h ap pr ov al in Fed

. R. Cri m

. P. 32 .2 ad vi so ry

co m m it te e’s no te to th e 20 00 am en dm en ts su bd

. (c))

. “ W e m ay affi rm on an y ba si s

su pp or te d by th e reco rd .” Green Tree Serv

., LLC v. DBSI Lan dm ark Tower s, LLC,

65 2 F.3 d 91 0, 91 3 (8 th Ci r. 20 11 ) (q uo ti ng Sch oe lc h v. Mi tc he ll

, 62 5 F. 3 d 10 41

, 10 46 (8t h C ir. 2 01 0) ).

A.

W hi te co nt en ds th at sh e ha s a rig ht to rel it ig at e th e fact ua l ba si s un de rlyin g th e

go ve rn m en t’s fo rfei tu re of Defen da nt ’s ZINK st oc k. W hi te arg ue s th at D e f e n da nt

“ ob ta in ed th e su bjec t ZINK s ha res pr io r to th e in fu si on o f s a i d fu nd s fro m PCI[ .] ” App el la nt ’s Br. 13

. Sh e fu rth er co nt en ds th at “ PCI rece iv ed in co ns id erat io n fo r [th e $2 .5 m il li on tra ns fer to ZINK]

, se pa rat e sh ares of ZINK st oc k.” Id

. In es se nc e,
W hi te ar g u e s t h e ZI NK sh ares of st oc k were no t ne ces sa ril y th e pr od uc t of

Defen da nt ’s frau d.

Whi te m is un de rs ta nd s th e na tu re of an an ci ll ary he ari ng

. An an ci ll ary

pr oc eed in g al lo ws W hi te to es ta bl is h he r in te res t i n th e fo rfei te d pr op ert y as it

co m pa res to th e in te res ts of th e go ve rn m en t an d ot he r pe ti ti on ers ; it do es no t al lo w
he r to rel it ig at e th e ne xu s be twee n th e cr i mi n a l a ct s of he r ex -h us ba nd an d th e
fo rfei te d pr oc eed s fro m th e sa le of th e ZINK st oc k. Uni te d St at es v. Mo se r, 58 6 F.3 d

10 89

, 10 95 (8 th Ci r. 20 09 ). In Uni te d St at es v. Po rch ay , we co nc lu de d th at “ th ere is

no pr ov is io n in § 85 3( n) to rel it ig at e th e ou tc o me of [th e fo rfei tu re] pr oc eed in gs .”

53 3 F.3 d 70 4, 71 0 (8 th Ci r. 20 08 ); se e al so Mo se r, 58 6 F.3 d at 10 95 (fo ll owi ng
Po rch ay ). As th e di st ric t co ur t in di cat ed

, th e cri m in al pr oc eed in gs tra ce th e pr op ert y

-5

-to cri m in al act iv it y , an d th e an ci ll ary he ari ng un de r § 85 3( n) ad d r e s s e s “ cl ai m s of

own ers hi p an d pr io rit ie s of in te res t vi s- à-v is th e go ve rn m en t an d th e pe ti ti on ers .” D.

Ct

. Ord er of Apr il 19

, 20 11

, at 5 (q uo ti ng Mo se r, 58 6 F.3 d at 10 95 ). Thu s, W hi te

can no t ch al le ng e th e di st ric t co ur t’s fin di ng th at th e pr oc eed s fro m th e sa le of ZINK

st oc k were fo rfei ta bl e to th e Uni te d St at es ; sh e can m ak e he r cl ai m of own ers hi p an d

pr io rit y of in te res t on ly in rel at io n to th e go ve rn m en t an d an y ot he r pe ti ti on ers

. See

Mo se r, 58 6 F .3d at 1 09 5. 6

B.

W hi te ne xt co nt en ds th at sh e ha s st an di ng to co nt es t th e fo rfei tu re of th e ZINK

st oc k pr oc eed s. “ St an di ng in for fei tu re ca se s h as ‘ bo th co ns ti tu ti on al an d s ta tu to ry

as pe ct s.’” Uni te d St at es v. Tim le y , 50 7 F

. 3 d 1 1 2 5

, 11 29 (8 th Ci r. 20 07 ) (q uo ti ng
Uni te d St at es v. One -Si xt h Sh are of Ja m es J. Bu lg er in All Pres en t & Fu tu re Pro ceed s
of Mas s Mi ll io ns Lot te ry Tick et No. M2 46 23 3, 32 6 F.3 d 36

, 4 0 ( 1s t Ci r. 20 03 ) (h erei na fte r Mas s Mi ll io ns Lot te ry Tick et )). To es ta bl is h co ns ti tu ti on al st an di ng , “ a

pa rty se ek in g to ch al le ng e a fo rfei tu re of p r o pe rty m us t fir st de m on st rat e an

own ers hi p or po ss es so ry in te res t in th e se iz ed pr op ert y

. . . .” I d. (q uo ti ng Mas s
Mi ll io ns Lot te ry Tick et
, 32 6 F.3 d at 41 ). An own ers hi p in te res t su ffi ci en t fo r Arti cl e

III st an di ng “ can be sh own by act ua l po ss es si on , co nt ro l, ti tl e, an d fin an ci al st ak e.”

Uni te d St at es v. Prem is es Kno wn as 77 25 Uni ty Ave nu e Nor th

, Bro ok lyn P a r k,

Mi nn ., 29 4 F.3 d 95 4, 95 6 (8 th Ci r. 20 02 ). St at ut or y st an di ng un de r § 85 3( n) req ui res
th at W hi te de m on st rat e a le ga l in te res t in th e pr oc eed s of th e ZINK s to ck

. Tim le y , 50 7 F .3d at 1 12 9, 1 13 0 n .2.

We ha ve co ns id ered an d reject as in ap po si te
, Uni te d St at es v. Farl e y, 9 1 9 6
F.Su pp

. 27 6 (S.D. Ohi o 19 96 ), whi ch W hi te ci te s fo r th e pr op os it io n th at sh e can ch al le ng e th e fac tu al ba si s o f th e fo rfei tu re.

-6

-“ Bec au se a le g a l i n t e r e s t is req ui red to br in g a cl ai m un de r 21 U.S.C. §

85 3( n ) ( 2 )

, a c o ur t m

us t fir st lo ok to th e la w of th e juri sd ic ti on th at crea te d th e

pr op ert y rig ht to de te rm in e whe th er th e cl ai m an t ha s a va li d in te res t.” Id

. at 11 29 -3 0 (ci ti ng Uni te d St at es v. One Lin co ln Nav ig at or 19 98

, 32 8 F.3 d 10 11

, 10 13 (8 th Ci r.
20 03 )). W hi te cl ai m s bo th a co nt ract ua l an d a m ar i t a l in te res t in th e st oc k. W e
th eref or e lo ok to Mi nn es ot a st at e l a w t o de te rm in e whe th er W hi te ha s a va li d le ga l

in te res t in th e ZINK st oc k pr oc eed s. “ If th e cl ai m an t ha s no in te res t un de r st at e la w, 7

th e in qu iry en ds

, an d th e cl ai m fai ls fo r la ck of st an di ng .” Tim le y , 50 7 F.3 d at 11 30

.

i.

W e tu rn fir st to whe th er W hi te ha s a le ga l in te res t in th e st oc k pr oc eed s un de r
Mi nn es ot a co nt ract la w. W hi te co nt en ds th at sh e en te red in to a bi nd in g or al co nt ract 8

wit h Defen da nt fo r ha lf th e in crea se d va lu e of th e ZI N K s t o c k in ex ch an ge fo r he r

wor k as a m ark et in g co ns ul ta nt

. Oral co nt ract s are va li d an d en fo rcea b l e u nd er
Mi nn es ot a la w. Mag es v. Jo ha nn s, 4 3 1 F

. 3d 11 32 , 1 14 1- 42 (8 th Ci r. 20 05 ) (ci ti ng
McArd le v. W il li am s, 25 8 N.W

. 81 8, 82 0 (Mi nn

. 19 35 )). Accep ti ng th e f a c t s se t

fo rth in W hi te ’s am en de d pe ti ti on as tru e, we as su m e th at Defen da nt pr om is ed he r “ a
50 % s ha re in t h e i n c r e a se d va lu e of hi s ZINK s ha res of st oc k.” Su pp le m en ta l Aff.

of Ro byn W hi te 3. 9

Onl y th e pr oc eed s of th e sa le of th e st oc k were forf ei te d to th e Uni te d Stat es 7

go ve rn m en t, n ot th e st oc k i ts el f.

W hi te al so cl ai m ed a n i n t eres t in th e st oc k pr oc eed s ba se d on pr om is so ry 8

es to pp el

. Pro m is so ry es to pp el is an eq ui ta bl e cl ai m un de r Mi nn es ot a la w, Ru ud v. Great Pl ai ns Su pp ly, In c., 52 6 N.W .2d 36 9, 37 2 (Mi nn

. 19 95 ), an d th us do es no t gi ve ris e to a le ga l in te res t un de r § 85 3. Tim le y , 50 7 F.3 d at 11 29 (d efi ni ng “ le ga l
in te res t” to ex cl ud e eq ui ta bl e rig ht s)

. W hi te ha s ab an do ne d he r cl ai m of “ an in te res t si m il ar t o q ua nt um

m eru it .”

W hi te ’s cl ai m th at Defen da nt pr om is ed to pa y he r ha lf th e in crea se d va lu e of 9
hi s ZINK st oc k was no t refl ect ed in he r fir st pe ti ti on

. Th e di st ric t co ur t no te d th is

-7

-Und er Mi nn es ot a la w, “ [t]he fo rm at io n of a co nt ract req ui res co m m un ic at io n
of a sp eci fic an d de fin it e of fer, acce pt an ce, an d co ns id erat io n.” Co m m erci al Ass oc s.,

In c. v. W or k Co nn ect io n, In c., 71 2 N.W .2d 77 2, 78 2 (Mi nn

. Ct

. App

. 20 06 ). Part ie s

to a co nt ract m

us t “ ag ree wi th reas on ab le cert ai nt y ab ou t t he same thi ng an d o n t he

sa m e t e r ms

. ” P e t ers v. Mu t. Ben efi t Life In s. Co

., 42 0 N.W .2d 90 8, 91 4 (Mi nn . Ct. Ap p. 1 98 8) ; s ee al so Mi nn eap ol is Cab le syste m s v . C it y of Mi nn eap ol is

, 29 9 N.W .2d 12 1, 12 2 (Mi nn

. 19 80 ) (The re m us t be a “ m eet in g of th e m in ds

co nc ern in g [th e a l l e g e d ag reem en t’s] es se nt ia l el em en ts .”). “ [A]n al le ge d co nt ract

whi ch is so va gu e, in de fin it e, an d un cert ai n as to pl ace th e m ean in g an d in te nt of th e

pa rti e s in th e real m of sp ecu la ti on is vo id an d un en fo rcea bl e.” Kin g v. Dalt on
Mo to rs , In c., 10 9 N.W .2d 51

, 52 (Mi nn

. 19 61 ). Ass um in g a l l o f t h e fact s W hi te

al le ge d a re t ru e, W hi te an d Def en da nt di d n ot en te r in to a va li d c on tra ct

.

W hi te ’s pet it io n all eg es no th in g m or e th an th at Defen da nt ag reed to gi ve he r

on e-h al f th e in crea se va lu e in hi s ZINK st oc k in ex ch an ge fo r he r co nt in ui ng to wor k

fo r th e co m

pa ny wit ho ut a sa la ry

. Im po rta nt ly, no ti m e fram e or te rm was in di cat ed

in Defen da nt ’s al le ge d pr om is e to W hi te

. One -h al f th e in crea se in va lu e of th e ZINK

di sc rep an cy :

Th e C o ur t m

us t acce pt as tru e W hi te ’s as se rti on th at Defen da nt m ad e

su ch a pr om is e to he r. Fed

. R. Cri m

. P. 32 .2(c )(1 )(A). Nev ert he le ss , th e Co ur t no te s th at th is pr om is e was no whe re m en ti on ed in W hi te ’s in it ia l
Pet it io n; on l y a f

t er sh e am en de d he r Pet it io n di d sh e cl ai m th at th ere

ex is te d su ch an ex pr es s ag reem en t. Co ur ts typic al ly lo ok as ka nc e at be la te d a t t e mp t s to ad d ne w or ad di ti on al gr ou nd s fo r rel ie f to th ird

pa rty pe ti ti on s. See, e.g ., Uni te d St at es v. So rei de

, 46 1 F.3 d 13 51

, 13 55 (1 1t h Ci r. 20 06 ) (p er cu ria m ); Uni te d St at es v. W at so n, 59 4 F. Su pp .2d
96 1, 96 4 (W. D. Mi ch

. 20 08 ); Uni te d St at es v. St ru be

, 58 F. S u p p

. 2d
57 6, 58 5 (M.D. Pa. 19 99 ). Nev ert he le ss , th e Co ur t ne ed no t – an d do es

no t – rel y up on th is gro un d t o d en y W hi te rel ie f.

D. Ct. Ord er o f Apr il 19 , 20 11 , at 7 n.5

.

-8

-st oc k is a fig ur e su bjec t to pr ic e flu ct ua ti on s. Acco rd in gl y , th e a mo u n t Defen da nt

pr om is ed can no t be as ce r t a i n e d w it ho ut an ag reed up on en d da te

. Si m il arl y , th e 1 0

ag reem en t be twee n th e two di d no t in di cat e a le ng th of ti m e or un de r wha t co nd it io ns
W hi te was to co nt in ue wor ki ng f o r ZI N K w it ho ut a sa la ry

. The re is no way to 1 1

de te rm in e fro m W hi te ’s al le ga ti on s whe th er sh e fu l f i l l e d h e r en d of th e ba rg ai n.
Thu s, “ th e te rm s o f th e p ur po rte d c on tra ct are t oo va gu e an d in de fin it e to pro vi de a
ba si s fo r as cert ai ni ng th e pa rti es ’ rig ht s an d ob li ga ti on s.” Nav ic ka s v. Qui ll in g, No.

A10 -1 45

, 20 10 W L 52 90 55 2, at *6 (Mi nn

. Ct

. App

. 20 10 ) (u np ub li sh ed ) (fi nd in g a
writ in g th at fai le d to “es ta bl is h ho w a nd whe n th e ‘equ it y ’ wou ld be cal cu la te d” to

be un en fo rcea bl e); se e al so Log an v. St

. J u d e M e d

., In c., No. A04 -1 24

, 20 04 W L

19 25 87 5, at *2 (Mi nn

. Ct

. App

. 20 04 ) (u np ub li sh ed ) (fi nd in g th at a co nt ract la ck in g
in te rm s to de te rm in e th e va lu at io n of st oc k op ti on s, “ in cl ud in g th e ex erci se pr ic e, th e

ex pi rat io n da te
, a nd th e ve st in g da te of th e op ti on s[ ,] ” was to o va gu e to be

en fo rcea bl e). Bec au se W hi te do es no t ha ve an en fo rcea bl e co nt ract un de r Mi nn es ot a
la w, sh e al so d o e s n o t ha ve a co nt ract -b as ed le ga l in te res t in th e pr oc eed s of th e
ZINK st oc k.

Eve n if we as su m e t h a t W hi te ha s pl ed an or al co nt ract wit h de fin it e en ou gh

te rm s to be en fo rcea bl e, sh e m us t al so as se rt a le ga l in te res t in th e fo rfei te d pr op ert y

.

W hi te do es no t a l l e ge th at Defen da nt ag reed to gi ve he r ha lf th e in crea se d 1 0

va lu e of hi s ZINK st oc k be twee n th e da te s of Ja nu ary 20 07 an d Octo be r 20 08 whe n

“ sh e was effe ct iv el y ou st ed fro m he r emp l o y m en t by th e in di ct m en t of [Defe nd an t][.] ” App el la nt ’s Br. 26

.

W hi te al le ge s th at sh e wor ke d fro m Ja nu ary 20 07 to Sep te m be r 20 08 wit ho ut 1 1

a sa la ry

. W e no te th at if th e al le ge d co nt ract co ul d no t be pe rfo rm ed in le ss th an on e
y ear, it was req ui red to be red uc ed to a writ in g to be en fo rcea bl e un de r Mi nn es ot a’s

st at ut e of fr a u d s

. M i n n

. St at

. § 51 3.0 1; bu t se e Ekl un d v. Vin cen t Bras s an d Alu m in um Co

., 35 1 N.W .2d 37 1, 37 5- 76 (Mi nn

. Ct

. App

. 19 84 ) (h ol di ng th at a

co nt ract fo r em

pl oym en t “ so lo ng as he pe rfo rm ed sa ti sf act or il y ” di d no t vi ol at e th e
st at ut e of frau ds whe re it was po ss ib le fo r th e co nt ract to ha ve be en fu ll y pe rfo rm ed wit hi n on e y ear)

. W hi te fai ls to al le ge an y type of te rm fo r he r al le ge d or al co nt ract

.

-9

-See 21 § 85 3( n) (2 ). A va li d co nt ract ua l in te res t in a su m of m on ey eq ua l to on e-h al f

th e in crea se in va lu e o f th e ZINK st oc k i s no t th e type of le ga l i nt eres t s uf fic ie nt to

co nf er st an di ng to co nt es t th e fo rfei tu re of th e ZINK st oc k pr oc eed s. Accep ti ng th e
fact s all eg ed in th e pe ti ti on as tru e, W hi te ha d an or al co nt ract wit h Defen da nt fo r a

su m of m on ey eq ua li ng ha lf th e in crea se d va lu e of th e ZINK sh ares of st oc k. Thu s,
W hi te ’s in te res t in pa y m en t is ti ed to th e st oc k’s va lu e bu t is no t act ua ll y in th e st oc k

or th e pr oc eed s th ereo f. See 2 1 U.S.C. § 85 3( n) (2 ) (req ui rin g a n in it ia l sh owi ng of

a “ le ga l in te res t in pr op ert y whi ch ha s be en or de red fo rfei te d” ); se e al so Uni te d St at es

v. Ri ba de ne ira

, 10 5 F.3 d 83 3, 83 6 (2 d Ci r. 19 97 ) (p er cu ria m ) (h ol di ng th at in or de r

to ob ta in st an di ng a pe ti ti on er m us t ha ve “ an in te res t in a pa rti cu la r, sp eci fic as se t” ).

Any br each by Defen da nt of th e or al co nt ract wit h W hi te do es no t co nf er up on
W hi te a le ga l in te res t in th e ZINK st oc k pr oc eed s. As th e di st ric t co ur t ap tl y no te d,

Defen da n t d i d no t pr om is e to tra ns fer fif ty-perc en t of hi s sh ares of ZINK st oc k to

W hi t e

. D

. C t. Ord er of Apr il 19

, 20 11

, at 7. The ZINK st oc k was own ed by

Defen da nt an d was he l d in hi s na m e. W hi te al so do es no t al le ge fact s to sh ow th at

sh e ha s a le ga l i nt eres t i n t he pro ceed s o f th e sa le of De fen da nt ’s ZINK s to ck

. The

su m of m on ey owe d to he r, if th e or al co nt ract is de em ed bi nd in g, cou ld co m e fro m

an y of De fen da nt ’s ass et s t ha t wer e n ot th e p ro ceed s o f cri m in al act iv it y

.

In DSI Ass oc ia te s LLC v. Uni te d St at es , th e Seco nd Ci rcu it he ld th at a

pu rc h a s e of sh ares wit ho ut ta ki ng a se cu rit y in te res t th erei n ren de rs th e pu rch as er

m erel y a ge ne ral cred it or of th e se ll er. 49 6 F.3 d 17 5, 18 4 (2 d Ci r. 20 07 ). A ge ne ral

cred it or do es no t po ss es s “ an in te res t ‘in’ a ‘part ic ul ar, sp eci fic as se t’ th at is

, or is pa rt

of

, th e fo rfei te d pr op ert y ,” an d “ do es no t m eet th e st at ut or y req ui rem en ts for in it ia ti ng

an an ci ll a r y pr oc eed in g un de r se ct io n 85 3( n) .” Id

. (q uo ti ng Ri ba de ne ira

, 10 5 F.3 d

at 83 5- 37 ). W e ag ree wit h th is an al y si s an d ho ld th at a ge ne ral cred it or do es no t ha ve

st an di ng to cl ai m an in t e r e s t i n a pa rti cu la r fo rfei te d as se t. Nowh ere in W hi te ’s

pe ti ti on , am en de d pe ti ti on , or a t t a c h e d affi da vi ts do es sh e al le ge th at sh e to ok a

se cu rit y in te res t in th e ZINK st oc k or it s pr oc eed s. Thu s, ev en as su m in g th e

-1 0-ex is te nc e of an en fo rcea bl e or al co n t r a c t
, W hi te ’s p et it io n fai ls to de m on st rat e th at

sh e ha s st an di ng to co nt es t th e fo rfei tu re of th e pr op ert y ba se d on a co nt ract ua l

in te res t i n t he st oc k p ro ceed s.

ii

.

W e tu rn ne xt to W hi te ’s cl ai m of a m ari ta l in te res t in th e ZINK st oc k pr oc eed s.
Wh i t e fir st co nt en ds th at he r m ari ta l in te res t is de riv ed fro m Mi nn es ot a St at u t e s

se ct io n 51 8.5 4 (n ow Mi nn es ot a St at ut es se ct io n 51 8.0 03 su bd iv is io n 3( b) )

, whi ch

de fin es “ m ari ta l pr op ert y ” an d “ no nm a rit al pr op ert y ” fo r pu rp os es of m ari ta l

di ss ol ut io n. W hi te al so co nt en ds th at th e di vo rce de cree en te red in Hen ne pi n Co un ty

Dis tri ct Co ur t award in g he r on e-h al f th e pr oc eed s of th e ZINK st oc k co nf ers st an di ng

up on he r. W hi te th us us es di vo rce la w t o c l a i m a m ari ta l in te res t in th e st oc k

1 2

pr oc eed s. Ass um in g, wit ho ut de ci di ng , th at W hi te ha s st an di ng ba se d on a m ari ta l

1 3

in te res t in th e ZINK st oc k pr oc eed s, we ne ed no t rev e r s e t he di st ric t co ur t’s or de r
de nyin g th e he ari ng be cau se W hi te co ul d no t prev ai l even if on e were gr an te d. See

Tim le y , 50 7 F .3d at 1 13 1.

W hi te can no t pr ev ai l in th e fo rfei tu re pr oc eed in g un le ss sh e qu al ifi es fo r rel ie f

un de r on e of th e two pr on gs of § 85 3( n) (6 ). Sh e m us t ei th er de m on st rat e pr io rit y of

own ers hi p in th e fo rfei te d pr op ert y or es ta bl is h th at sh e was a bo na fid e pu rch as er fo r

Bo th of W hi te ’s fo rfei tu re pe ti ti on s pr ed at e t h e di vo rce de cree

. Thu s, sh e 1 2

co ul d no t pl ead th at th e di vo rce de cree co nf erre d st an di ng up on he r in th is fo rfei tu re
pr oc eed in g, an d t he di st ric t co ur t d id no t co ns id er t he effe ct of t ha t d ecre e.

As th e di st ric t co ur t no t e d

, we co nf ro nt ed a ne arl y id en ti cal si tu at io n in 1 3
Uni te d St at es v. C o c h e no ur , 44 1 F.3 d 59 9 (8 th Ci r. 20 06 ). The re, we he ld th at

“ [d ]ivo rce la w do es no t go ve rn a sp ou se ’s cl ai m ed in te res t in fo rfei te d pr op ert y .” Id

. at 60 1 (ci ti ng Uni te d St at es v. Tot aro , 34 5 F.3 d 98 9, 99 7- 98 (8 th Ci r. 20 03 )). To th e

ex te nt th at W hi te ’s cl ai m is arg ua bl y di st in gu is ha bl e fro m th at al le ge d in Co ch en ou r, he r pe ti ti on fai ls on th e m eri ts

.

-1 1-va lu e of th e pr op ert y

. 21 U.S.C. §§ 85 3( n) (6 )(A) (s up eri or in te res t), (n )(6 )(B) (b on a

fid e pu rch as er); Tim le y , 50 7 F.3 d at 1 1 3 0

. W hi te do es no t cl ai m pr io rit y of

own ers hi p un de r § 85 3( n) (6 )(A). Sh e cl ai m s in st ead th at sh e is a bo na fid e pu rch as er
fo r va lu e of th e ZINK st oc k pr oc eed s an d th us sh ou ld pr ev ai l un de r § 85 3( n) (6 )(B)

. To qu al ify as a bo na fid e pu rch as er fo r va lu e, W hi te m us t sh ow: “ (1 )

. . . a le ga l

in te res t in th e pr op ert y ; (2 ) th e in te res t was acq ui red as a bo na f i d e p u r c h as er fo r

va lu e; an d (3 ) th at th e in t e r e s t w as acq ui red at a ti m e whe n th e cl ai m an t was

reas on ab ly wit ho ut cau se to be li ev e th at th e pr o p e r t y w as su bjec t to fo rfei tu re.”

Tim le y , 50 7 F .3d at 1 13 0- 31

.

Ass um in g sh e ha s a le ga l in te res t de riv ed fro m he r m arri ag e to an d su bs eq ue nt

di vo rce fro m Defen da nt
, W hi te was no t reas on ab ly wit ho ut cau se to be li ev e th at th e

pr oc eed s were su bjec t to fo rfei tu re at th e t i me s h e acq ui red he r in te res t. Und er
Mi nn es ot a d iv or ce law, W hi te ’s rig ht s ves te d, at the earl ie st
, whe n s he co m m en ced

th e di ss ol ut io n pr oc eed i n g s on Sep te m be r 20

, 20 10

. Mi ll er v. Mi ll er, 35 2 N.W .2d

73 8, 74 3 (Mi nn

. 19 84 ). W hi te kn ew of Defen da nt ’s c r i mi n a l a ct iv it y an d th e

as so ci at ed for fei tu re p ro ceed in gs be fo re fi li ng for di vo rce. Defen da nt was ch arg ed

wit h th e frau d an d pl ed gu il ty on Octo be r 8, 20 08

. Defen d a n t ag reed in hi s pl ea

ag reem en t th at al l fu nd s he rece iv ed fro m PCI were pr oc eed s of th e frau d an d su bjec t

to fo rfei tu re. In ad di t i o n, th e di st ric t co ur t ha d or de red th e fo rfei tu re of al l of

Defen da nt ’s pr op ert y tra ceab le to th e frau d on e week be fo re W hi te fil ed fo r di vo rce.
W hi te th us was no t reas on ab ly wit ho ut cau se to be li ev e th at th e ZINK st oc k pr oc eed s

were su bjec t to fo rfei tu re at th e ti m e sh e fil ed fo r di vo rce. Acco rd in gl y , W hi te can no t

pr ev ai l u nd er § 85 3( n) (6 )(B) ev en if s he ha s a m ari ta l i nt eres t i n t he pro ceed s.

III.

Bec au se W hi te ha s no t al le ge d a le ga l in te res t in th e ZINK st oc k pr oc eed s, sh e
la ck s st an di ng to m ai nt ai n th is act io n. To th e ex te nt th at W hi te ha s al le ge d a le ga l

in te res t in th e st oc k pr oc eed s ba se d on a m ari ta l in te res t, he r p e t i t i o n f ai ls on th e

-1 2-m eri ts

. Acco rd in gl y , th e di st ric t co ur t’s jud g men t di sm is si ng th e pe ti ti on an d

am en de d p et it io n i s af

fir m ed

.

__ __ __ __ __ __ __ __ __ __ __ __ __ __ __

-1 3-