Opinion ID: 685598
Heading Depth: 2
Heading Rank: 2

Heading: Willful Blindness and Sec. 881(a)(4)(C)

Text: 39 This court has yet to construe the willful blindness language in Sec. 881(a)(4)(C). We must choose between two possible standards: an objective due care standard, on the one hand, and a subjective deliberate ignorance or conscious avoidance standard on the other. Under the objective standard, willful blindness exists when an owner fails to exercise due care to ensure that the property will not be and has not been used to facilitate a drug transaction. Under the subjective standard, willful blindness exists if the owner is aware of a high probability that the property will be or has been used to facilitate a drug transaction and does not make reasonable inquiries to confirm whether it will be or in fact has been so used. 40 Unfortunately, the statutory language does not define willful blindness, and the legislative history reveals considerable confusion over the concept. Representative Shaw, a major force behind the enactment of Sec. 881(a)(4)(C), suggested that the willful blindness component was meant to impose a duty on owners to be reasonably informed concerning the purpose for which another person may use their property. 134 CONG.REC. 33,290 (1988) (statement of Rep. Shaw). Thus he apparently endorsed the objective due care definition of willful blindness, a definition he derived from the Supreme Court's decision in Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663, 94 S.Ct. 2080, 40 L.Ed.2d 452 (1974). See 134 CONG.REC. 33, 290 (1988) (statement of Rep. Shaw). 41 In Calero-Toledo, the Court stated in dicta that a defense to forfeiture might be available to an owner who proved not only that he was uninvolved in and unaware of the wrongful activity, but also that he had done all that reasonably could be expected to prevent the proscribed use of his property. 416 U.S. at 689, 94 S.Ct. at 2094-95. At issue in Calero-Toledo, however, was the constitutionality of a Puerto Rican forfeiture statute, and thus the Calero-Toledo dicta only addressed a possible constitutional limit of a forfeiture statute. Ironically, then, Representative Shaw used a potential outer constitutional limit on the power of a forfeiture statute for the meaning of a provision that was intended to cut back on the reach of the statute. In other words, if the willful blindness prong in Sec. 881(a)(4)(C) is interpreted according to the Calero-Toledo constitutional text, then the provision is entirely superfluous since the Calero-Toledo constitutional limit applies to every forfeiture statute, even those without an innocent owner provision. 9 42 Of course Calero-Toledo might still provide the meaning of willful blindness in Sec. 881(a)(4)(C) if that is what Congress had intended. But we doubt that other legislators shared Representative Shaw's belief that the willful blindness language should be equated with the Calero-Toledo dicta. Most others who made statements on the matter apparently had in mind the more traditional common law formulation of willful blindness--a subjective deliberate ignorance or conscious avoidance state of mind. See 134 CONG.REC. 33,288 (1988) (Willful blindness addresses the cases of individuals who have demonstrated a conscious purpose to avoid the truth.) (statement of Rep. Young); id. at 33,313 ([The concept of willful blindness] is intended to prevent the owner of a conveyance from closing his eyes to a violation.) (statement of Rep. Jones); id. at 33,315 (Willful blindness addresses the case of individuals who have demonstrated a conscious purpose to avoid the truth. The concept of willful blindness is essentially part of the proof of knowledge.) (statement of Rep. Davis). 43 Perhaps because of the confusion in the legislative history, a circuit split appears to be developing over the definition of willful blindness in the context of civil forfeiture. The Eleventh Circuit has held that the appropriate standard is the objective due care standard of Calero-Toledo. United States v. One 1980 Bertram 58' Motor Yacht, 876 F.2d 884, 888 (11th Cir.1989). Bertram endorsed a pure due care standard: the owner had to do everything that a truly innocent owner reasonably could be expected to do to insure that his vessel was not to be used illegally. Id. at 889. 10 The Eighth Circuit, however, has held in 1989 Jeep Wagoneer that the appropriate standard is the subjective one--whether one deliberately closed his or her eyes to what otherwise would have been obvious--and has expressly rejected the idea that the willful blindness test under Sec. 881(a)(4)(C) should be identical to the constitutional standard of Calero-Toledo. See 976 F.2d at 1174-75. 44 In our leading case on willful blindness, United States v. Caminos, 770 F.2d 361, 365 (3d Cir.1985), we held that the deliberate ignorance requirement is met only if the defendant himself was subjectively aware of the high probability of the fact in question, and not merely [if] a reasonable man would have been aware of the probability. Id. at 365. Under this definition, willful blindness is a subjective state of mind that is deemed to satisfy a scienter requirement of knowledge. 11 Although courts and commentators have yet to come to a consensus on a definition of willful blindness, 12 the Caminos formulation basically adopts the mainstream conception of willful blindness as a state of mind of much greater culpability than simple negligence or recklessness, and more akin to knowledge. See supra n. 12. See also United States v. Rivera, 944 F.2d 1563, 1570 (11th Cir.1991) (willful blindness equated with the concept of deliberate ignorance and treated as a state of mind equally culpable as actual knowledge); United States v. Rothrock, 806 F.2d 318, 323 (1st Cir.1986) (The purpose of the willful blindness theory is to impose criminal liability on people who, recognizing the likelihood of wrongdoing, nonetheless consciously refuse to take basic investigatory steps.). Thus in the absence of a clear statement in either the statute or the legislative history, we adopt the Caminos definition of willful blindness for Sec. 881(a)(4)(C). 13 45 This construction is consistent with the general agreement manifest in the legislative history that the Sec. 881(a)(4)(C) innocent owner defense should be the same as those of Secs. 881(a)(6) and (7). Representative Shaw, for instance, stated that the defense under Sec. 881(a)(4)(C) was virtually identical to the defense for innocent owners under Secs. 881(a)(6) and (7). 134 CONG.REC. 33,290 (1988). Others expressed the same sentiments. See 134 CONG.REC. 33,288 (1988) (The concept of willful blindness is essentially part of the proof of lack of knowledge. For this reason, the defense for innocent owners of conveyances seized for drug related offenses is virtually identical to the existing defenses for innocent owners of real property ... or other things of value under paragraphs (6) and (7) of section 511(a) of the Controlled Substances Act (21 U.S.C. 811(a)(6) and (7)).) (statement of Rep. Young); ([T]he defense for innocent owners of conveyances seized for drug-related offense[s] is virtually identical to the existing defenses for innocent owners of real property, and money....) (statement of Rep. Young); see also 1 DAVID SMITH, PROSECUTION AND DEFENSE OF FORFEITURE CASES p 4.02[a], at 4-10 (1993) ([Section 881(a)(4)(C) ] should be interpreted in pari materia with the identical innocent owner provisions in sections 881(a)(6) and (a)(7).). 46 Our construction is further supported by the fact that, despite the textual absence of willful blindness terminology, both Sec. 881(a)(6) and Sec. 881(a)(7) have been interpreted by many courts to require owners to demonstrate not only a lack of actual knowledge, but also a lack of willful blindness. 14 Because the only way willful blindness can become part of the innocent owner defense in those sections is if the knowledge component is read to incorporate willful blindness, courts have tended to adopt the deliberate ignorance formulation of willful blindness of Secs. 881(a)(6) and (7). See, e.g., 1980 Red Ferrari, 827 F.2d at 480 (stating that the claimant could have avoided knowledge that the Ferrari was involved in drug trafficking only by sticking his head in the sand (internal quotation omitted)). Thus, interpreting Sec. 881(a)(4)(C) to require the owner to show a lack of deliberate ignorance ensures that its innocent owner defense is the same as that required under Secs. 881(a)(6) and (7). 15
47 Turning now to the facts before us, under the standard we adopt today, willful blindness could not be found if it were positively established that Goodman did not know that the Rolls Royce was used for drug trafficking. Similarly, if Goodman were just lacking in intelligence, negligent, or mistaken, he should not be found to have been willfully blind. But if Goodman fails to show that he did not know there was a high probability that the vehicle had been used to traffic drugs, and then fails to show that he took affirmative steps to investigate whether the car had in fact been used to facilitate drug trafficking, he will not have satisfied his burden to show that he was not willfully blind. 48 Unfortunately, we cannot determine whether the district court used the appropriate standard when it held that Goodman failed to show that he was not willfully blind. The district court formulated the willful blindness standard as ignor[ing] a signal or suggestion that a vehicle might have been used to facilitate the trafficking of illegal drugs, and explained that once the claimant chooses to ignore the signal, he or she can no longer establish lack of willful blindness to the prior use of the vehicle.... Amicus argues that this language is an objective due care formulation. The government disagrees. We are inclined to agree with amicus, though we cannot tell for sure. Although the district court supported its conclusion by citing 1989 Jeep Wagoneer, 976 F.2d at 1175, which endorsed a subjective standard, it then cited language from 1977 Porsche Carrera 911, 748 F.Supp. at 1186, which seems to endorse an objective one. Moreover, the standard announced by the district court focuses on the owner rather than the car (it stated [s]uch a suggestion might arise from the fact that the vehicle was owned by one accused of drug trafficking), but it does so erroneously, see infra at 811. We therefore will vacate the judgment of forfeiture and remand for reconsideration under the standard we articulate today. We take this opportunity to provide some guidance to the district court in considering this issue on remand. 49 It appears from the record before us that it is virtually undisputed that Goodman took no steps to investigate whether the Rolls Royce had been used to facilitate drug trafficking at the time he acquired it. The principal issue on remand, therefore, reduces to the following factual inquiry: whether Goodman had actual knowledge of a high probability that the Rolls Royce was used in drug trafficking. 50 Although the standard we announce requires proof of actual knowledge of the high probability, such knowledge is commonly proven by inference from circumstantial evidence. Thus, for example, if it is proven that Goodman knew that Scarfo's only income was through drug trafficking, and the court finds that such facts are sufficient to support a conclusion that there was a high probability that the Rolls Royce had been used to facilitate drug trafficking, the district court could reasonably infer that Goodman actually knew about the high probability. The court may also reject testimony to the contrary that it finds is incredible, such as Goodman's claim that he did not know about the high probability that the car facilitated a drug transaction because Scarfo and the LCN had a rule against drug dealing. 51 One question that has arisen on this appeal is whether the high probability prong of the willful blindness test requires knowledge of a high probability that the vehicle itself was used to facilitate drug transactions, or whether it refers to knowledge of a high probability that the former owner of the vehicle was accused of drug trafficking. So stated, the answer is simple. Because this forfeiture action focuses on the taint of the res itself, the relevant question is whether Goodman knew of the high probability that the Rolls Royce itself was used to traffic drugs. The more difficult question, however, is whether knowledge that the previous owner had been accused of drug trafficking is sufficient, standing alone, to support an inference that the transferee was aware of a high probability that the car itself was used to facilitate drug trafficking. We do not think so. 52 Standing alone, an accusation of drug trafficking, even if in the form of an indictment, does not create a sufficiently high probability that property of the accused was used to facilitate drug trafficking. In our view, it is unreasonable to conclude that a claimant's knowledge of such an accusation, without more, supports the inference that the claimant was aware of a high probability that all of the property of the accused is tainted. The accused may have sources of income from legitimate businesses, and, in the context of this case, even if Goodman believed that Scarfo had no legitimate sources of income, he may have believed that his income came from illegal activities that had little or nothing to do with drug trafficking, or that Scarfo might have owned other cars other than the Rolls Royce that he used in drug trafficking. 16 We doubt that the civil forfeiture provisions, which are aimed at combating drug trafficking, are meant to allow forfeiture of property used in or bought with proceeds from non-drug related illegal activity. 53 We do not mean to suggest that Goodman has shown that he was not willfully blind. We state only that his knowledge that Scarfo had been indicted for drug dealing did not, by itself, necessarily invest Goodman with knowledge of a high probability that the car was tainted. However, there appears to be some evidence that Goodman knew more about the Rolls Royce's particular involvement in illegal activity than simply that its owner had been accused of drug trafficking. Specifically, shortly after he received ownership of the Rolls Royce, Goodman spent $4,000 removing counter-surveillance equipment from it. In any event, we leave the question to the district court on remand. 17 54 In sum, we hold that, to avoid the willful blindness prong of the innocent owner defense in Sec. 881(a)(4)(C), Goodman must demonstrate that he was not subjectively aware of a high probability that the Rolls Royce either was used or was going to be used to facilitate an illegal drug transaction, or, if he was, that he took affirmative steps reasonable under the circumstances to determine whether in fact the vehicle was going to be or had been so used. We also conclude that in applying this standard, the mere fact that Goodman was aware that Scarfo had been accused of drug trafficking does not, by itself, show that Goodman was aware of a high probability that the property was tainted. We now consider whether Goodman should also be entitled to an innocent owner defense if he shows that he did not consent to the Rolls Royce's improper use. 55