Opinion ID: 747825
Heading Depth: 1
Heading Rank: 3

Heading: analysis

Text: 17 Dunmore argues that the forfeiture of his interest in the personal property following his prosecution, conviction, and sentencing for criminal charges arising from the same conduct violated the Fifth Amendment's Double Jeopardy Clause. The trial court's determination that the forfeiture of Dunmore's personal property did not violate the Double Jeopardy Clause is a question of law this court reviews de novo. See United States v. Rodriguez-Aguirre, 73 F.3d 1023, 1025 (10th Cir.1996). 18 Dunmore's double jeopardy argument is foreclosed by the Supreme Court's recent decision in United States v. Ursery, --- U.S. ----, 116 S.Ct. 2135, 135 L.Ed.2d 549 (1996). In Ursery, the Court held that in rem civil forfeitures [under 21 U.S.C. § 881(a)(6) ] are neither 'punishment' nor criminal for purposes of the Double Jeopardy Clause. Id. at ----, 116 S.Ct. at 2149.
19 Dunmore asserts that the seizure of his real and personal property without prior notice and opportunity to be heard violated his Fifth Amendment right to due process. The ultimate conclusion of whether [Dunmore's] Fifth Amendment due process rights have been violated is subject to de novo review. United States v. Thody, 978 F.2d 625, 628 (10th Cir.1992).
20 Dunmore argues that the forfeiture of his real property is invalid because the United States failed to provide him prior notice and an opportunity to be heard before the seizure. See generally United States v. James Daniel Good Real Property, 510 U.S. 43, 45-47, 114 S.Ct. 492, 497, 126 L.Ed.2d 490 (1993) ([I]n the absence of exigent circumstances, the Due Process Clause of the Fifth Amendment prohibits the Government in a civil forfeiture case from seizing real property without first affording the owner notice and an opportunity to be heard.). In light of this violation, Dunmore asks this court to (1) reverse the order of forfeiture and remand the case to the district court with directions that the district court dismiss the forfeiture action without prejudice, or, in the alternative, (2) reverse the order of forfeiture and remand the case to the district court for the suppression of all evidence seized in violation of James Daniel Good, a new forfeiture proceeding for the real property, and a hearing on possible damages to Dunmore as a result of the United States' violation of James Daniel Good. 21 The most basic problem with Dunmore's arguments is that the forfeiture of his real property did not take place in this case, but instead took place in his criminal trial in the Western District of Missouri. As noted above, although the Complaint originally prayed for the forfeiture of Dunmore's real property, the United States eventually obtained the criminal forfeiture of that real property at Dunmore's criminal trial. Based on the judgment of forfeiture obtained in the criminal case, the United States moved to dismiss this civil action as to the real property on March 26, 1993. The district court granted the motion on March 31, 1993. 22 Dunmore has not identified and we have been unable to find any precedent that would allow this court to reverse the order of forfeiture of the real property entered in the Western District of Missouri and remand it to the District of Kansas for new forfeiture proceedings. Because each of Dunmore's alternative remedies explicitly implicate the validity of the judgment of forfeiture entered in the Western District of Missouri, Dunmore is obligated to bring his claims for relief in that court.
23 Dunmore also argues that the forfeiture of his personal property is similarly invalid because the United States failed to comply with James Daniel Good before seizing his furniture and furnishings. Dunmore's argument fails, however, because no preseizure notice or hearing is required before a federal agency may seize personal property subject to forfeiture for violation of federal drug laws. Madewell v. Downs, 68 F.3d 1030, 1038 (8th Cir.1995). As noted by the Eighth Circuit, the Supreme Court has consistently held that the United States need not provide a pre-deprivation hearing before seizing personal property pursuant to customs or drug forfeiture provisions. See United States v. $8,850 in United States Currency, 461 U.S. 555, 562 & n. 12, 103 S.Ct. 2005, 2011 & n. 12, 76 L.Ed.2d 143 (1983); Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663, 676-80, 94 S.Ct. 2080, 2088-90, 40 L.Ed.2d 452 (1974). Although the Supreme Court reached a contrary result with respect to real property in James Daniel Good, the Court was very careful in that case to limit its holding to real property. Furthermore, the Court was very careful in James Daniel Good not to overrule its prior precedent relating to the seizure of personal property. Accordingly, this court joins the Eighth Circuit in concluding that Calero-Toledo remains the law of the land. See Madewell, 68 F.3d at 1038-39 & n. 8. 24 Because the Due Process Clause does not obligate the United States to provide pre-deprivation notice and opportunity to be heard before the seizure of personal property, Dunmore's due process claims relating to the seizure of his personal property necessarily fail.
25 Dunmore asserts that the warrant for the arrest of his personal property was a general warrant in violation of the Fourth Amendment and that, consequently, the United States could not rely on any evidence seized under the warrant. This court reviews de novo a determination that a warrant is sufficiently particular. United States v. Janus Indus., 48 F.3d 1548, 1554 (10th Cir.), cert. denied, --- U.S. ----, 116 S.Ct. 87, 133 L.Ed.2d 44 (1995); United States v. Williamson, 1 F.3d 1134, 1135 (10th Cir.1993). 26 The Fourth Amendment requires that warrants particularly describ[e] the place to be searched, and the persons or things to be seized. U.S. Const. amend. IV. As the Supreme Court has explained, 27 The requirement that warrants shall particularly describe the things to be seized makes general searches under them impossible and prevents the seizure of one thing under a warrant describing another. As to what is to be taken, nothing is left to the discretion of the officer executing the warrant. 28 Stanford v. Texas, 379 U.S. 476, 485, 85 S.Ct. 506, 511-12, 13 L.Ed.2d 431 (1965) (quoting Marron v. United States, 275 U.S. 192, 196, 48 S.Ct. 74, 76, 72 L.Ed. 231 (1927)). The warrant for the arrest of personal property in this case complied with the Fourth Amendment's particularity requirement. 29 The Affidavit submitted in support of the application for the warrant for arrest of property sets out in extensive detail the investigation of Dunmore for drug trafficking. The fifty-one page Affidavit began by describing the activities of confidential informant Joseph Rector, a distant relative of Dunmore. The Affidavit recited how Rector had been recruited as a confidential informant and detailed Rector's extensive drug dealings with Dunmore over the previous several years. The Affidavit then set forth a recorded conversation between Rector and Dunmore on June 25, 1987, when Dunmore discussed the large cashflow generated by his drug trafficking business and the property that he had purchased with that money, including the subject house and its contents. 30 The Affidavit went on to detail how Dunmore was apparently laundering the proceeds of his drug trafficking business by purchasing both cashier's checks and property, including the house and contents, under the name of his uncle Thomas Stiles. The Affidavit referenced attached surveillance photographs from banks that depicted Dunmore purchasing cashier's checks under the name of Thomas Stiles. It also recounted interviews with employees from a number of furniture stores which identified Dunmore as the purchaser of the furniture and furnishings at issue here. Those same employees indicated that Dunmore had purchased the furniture and furnishings under the name of Thomas Stiles and had paid for the purchases with cashier's checks with Thomas Stiles listed as the remitter. 31 Finally, the Affidavit recounted an extensive background investigation of the financial conditions of both Thomas Stiles and Dunmore. That investigation demonstrated Thomas Stiles never lived in the subject house and did not have the financial means to purchase either the house or its belongings. Furthermore, the investigation demonstrated that Dunmore had no employment history for the prior thirteen fiscal quarters and had not filed a federal income tax return since some time before 1970. 5 32 In light of the Affidavit, a magistrate judge found that probable cause existed to believe the real property and all its furnishings, fixtures, and equipment were proceeds traceable to exchanges of controlled substances in violation of subchapter I of Title 21, United States Code, subject to seizure pursuant to 21 U.S.C. § 881. Based on that conclusion, the magistrate judge authorized a warrant for the arrest of the defendant real property and all fixtures, furnishings, and equipment within the buildings, appurtenances, and improvements, including but not limited to, a dining room table and chairs, living room furniture, a marble table, marble accessories, clocks, a grandfather clock, draperies, oriental rugs, and a 'muskrat' throw. 33 On appeal, Dunmore contends that the warrant is an invalid general warrant because it allowed the United States to seize all of the personal property in the house without any limitation as to the kind of property to be seized or any description as to how the property might be related to the alleged underlying criminal offense. The basic problem with Dunmore's argument is that the magistrate judge found probable cause to believe that all of the furnishings in the house were the converted proceeds of Dunmore's drug trafficking business. There was sufficient evidence in the Affidavit upon which to base the probable cause conclusion: (1) Dunmore had admitted to Rector that the house and all of its furnishings were purchased with drug proceeds; (2) many of the identified furnishings of the home had been purchased by Dunmore in the name of his uncle Thomas Stiles, in an apparent effort to launder his drug proceeds; and (3) neither Stiles nor Dunmore had lawful means to purchase furnishings for the home. In light of the magistrate judge's unchallenged finding that probable cause existed to believe all of the furniture and furnishings in the house were purchased with drug proceeds and the virtual impossibility of cataloging every single fixture or furnishing in the house, the warrant was as particular as it could be and, therefore, comported with the requirements of the Fourth Amendment. See Janus, 48 F.3d at 1554 (approving affidavit and warrant that were as specific as circumstances would allow); United States v. Emmons, 24 F.3d 1210, 1216 (10th Cir.1994) ( 'When the circumstances of the crime make an exact description of the fruits and instrumentalities a virtual impossibility, the searching officer can only be expected to describe the generic class of items he is seeking.' ) (quoting United States v. Harris, 903 F.2d 770, 775 (10th Cir.1990)).
34 Dunmore asserts that the forfeiture of his personal property violates the Excessive Fines Clause of the Eighth Amendment. This court reviews Dunmore's Eighth Amendment claim de novo. See United States v. One Parcel Property, 106 F.3d 336, 338 (10th Cir.1997) (per curiam); United States v. 829 Calle de Madero, 100 F.3d 734, 736 (10th Cir.1996). 35 Before reaching the merits, this court must address whether Dunmore waived his Eighth Amendment claim by failing to properly raise it below. After the district court entered its decision forfeiting Dunmore's personal property, Dunmore filed a timely motion for a new trial pursuant to Fed.R.Civ.P. 59. Approximately ten days later, while Dunmore's Rule 59 motion was still pending in the district court, the Supreme Court decided Austin v. United States, 509 U.S. 602, 113 S.Ct. 2801, 125 L.Ed.2d 488 (1993). In Austin, the Supreme Court concluded that forfeitures under 21 U.S.C. §§ 881(a)(4) and (a)(7) are subject to the Eighth Amendment's Excessive Fines Clause. See id. at 621-22, 113 S.Ct. at 2811-12. Relying upon that newly issued decision, Dunmore, proceeding pro se, filed a new motion styled as follows: Motion to Annul the Judgment and Return All Property Herewith in that the Judgment Rendered is Clearly in Violation of the Excessive Fines Clause of the Eighth Amendment of the United States Constitution. After denying Dunmore's Rule 59 motion on the merits, the district court refused to address Dunmore's Motion to Annul because it was filed after the issues in the case had been resolved by the court's Memorandum and Order granting summary judgment in favor of the plaintiff. That order closed the case and final judgment was entered on June 17, 1993. 36 Given Dunmore's pro se status and the timing of the issuance of Austin, the district court erred in refusing to consider Dunmore's Eighth Amendment claims. See United States v. All Assets & Equip. of W. Side Bldg. Corp., 58 F.3d 1181, 1191-92 (7th Cir.1995) (holding that district court abused its discretion in refusing to consider due process challenge based on Supreme Court's newly announced decision in Daniel Good, even though challenge was first raised in claimants' reply brief in support of motion for reconsideration of final judgment), cert. denied sub nom., Penny v. United States, --- U.S. ----, 116 S.Ct. 698, 133 L.Ed.2d 656 (1996); see also United States v. One 1978 Piper Cherokee Aircraft, 91 F.3d 1204, 1210 (9th Cir.1996) (considering Excessive Fines claim raised for first time on appeal in order to avoid possibility of manifest injustice). As a consequence, Dunmore has not waived his Eighth Amendment claim. 37 Notwithstanding both parties' suggestion of remand should this court determine that the district court erred in refusing to address the Excessive Fines issue, we conclude that Dunmore's claim can be resolved as a matter of law. 6 38 In granting the United States' summary judgment motion and forfeiting Dunmore's personal property to the United States, the district court found the United States had submitted a plethora of evidence that Dunmore had purchased the personal property with the proceeds of illegal drug trafficking and that the personal property ... constitute[d] the proceeds of criminal activity forfeitable under 21 U.S.C. § 881(a)(6). In light of this unappealed finding, 7 the dispositive question is whether the § 881(a)(6) forfeiture of drug proceeds can ever be excessive under the Eighth Amendment. Consistent with the rulings of other circuits, we answer the question in the negative and hold as a matter of law that forfeiture of drug proceeds pursuant to § 881(a)(6) can never be constitutionally excessive. See United States v. Tilley, 18 F.3d 295, 299-300 (5th Cir.1994); see also Smith v. United States, 76 F.3d 879, 882 (7th Cir.1996); United States v. $184,505.01 in United States Currency, 72 F.3d 1160, 1168-69 (3d Cir.1995), cert. denied sub nom., McGlory v. United States, --- U.S. ----, 117 S.Ct. 48, 136 L.Ed.2d 13 (1996); United States v. Salinas, 65 F.3d 551, 553 (6th Cir.1995); United States v. Wild, 47 F.3d 669, 676 (4th Cir.), cert. denied sub nom., Greenfield v. United States, --- U.S. ----, 116 S.Ct. 128, 133 L.Ed.2d 77 (1995); United States v. Alexander, 32 F.3d 1231, 1236 (8th Cir.1994). 39 As aptly noted by the Fifth Circuit, [t]he forfeiture of proceeds of illegal drug sales serves the wholly remedial purposes of reimbursing the government for the costs of detection, investigation, and prosecution of drug traffickers and reimbursing society for the costs of combating the allure of illegal drugs, caring for the victims of the criminal trade when preventative efforts prove unsuccessful, lost productivity, etc. Tilley, 18 F.3d at 299; cf. Ursery, --- U.S. at ---- - ----, 116 S.Ct. at 2148-49 (To the extent that § 881(a)(6) applies to 'proceeds' of illegal drug activity, it serves the additional nonpunitive goal of ensuring that persons do not profit from their illegal acts.). Furthermore, on a macroeconomic level, the estimated proceeds of illegal drug sales are roughly equivalent to the yearly costs drugs inflict on society and government. See Tilley, 18 F.3d at 299 (setting forth estimate that illegal drug sales produce approximately $80 to $100 billion per year while exacting costs of $60 to $120 billion per year); see also Smith, 76 F.3d at 882 ([P]roceeds forfeitures can never be out of proportion to the 'loss' suffered by the government or society. If ... certain property ... is forfeitable pursuant to § 881(a)(6) as proceeds of drug trafficking, it is directly equal [to] that part of the profits with which it was purchased. It directly represents at least a portion of the profits and can thus be less than or equal to society's loss, but not more than the loss. For this reason, there is no argument based on proportionality or excessiveness available....). Finally, on a microeconomic level, the forfeiture of drug proceeds, contrasted with the types of properties considered by the Supreme Court in Austin, extracts from the particular drug trafficker with some precision an amount of money equivalent to the costs that the drug dealer has imposed on society. See Tilley, 18 F.3d at 300. 8 Because the amount of proceeds produced by an individual drug trafficker is always roughly equivalent to the costs that drug trafficker has imposed on society, the forfeiture of those proceeds can never be constitutionally excessive. See id. 40 Dunmore's personal property was forfeited pursuant to § 881(a)(6) as proceeds of drug transactions. Therefore, the forfeiture is proportionate as a matter of law and his Eighth Amendment objection is rejected. 9 41
42 Dunmore asserts that the United States' conduct in prosecuting this civil forfeiture was fundamentally unfair and thus violated the Fifth Amendment's Due Process Clause. Dunmore lists the following alleged due process violations: (1) the sealing of the Affidavit occasioned a prejudicial delay in these forfeiture proceedings; (2) the Complaint was not sufficiently particular to meet the requirements of Supplemental Federal Rule of Civil Procedure E(2)(a); (3) the United States sought and obtained a protective order which prevented him from discovering the basis of this forfeiture action; (4) his real property was sold pursuant to an interlocutory order before he had a chance to challenge this forfeiture action on the merits; and (5) the United States used the pendency of the civil forfeiture action to deny him his right to due process in his criminal proceedings. These Fifth Amendment claims are reviewed de novo. See Thody, 978 F.2d at 628. 43 Dunmore's contention of delay caused by the sealing of the Affidavit is ill-conceived; it was Dunmore, not the United States or the district court, who delayed this action by asking that the proceedings be stayed. After the United States informed him that he was also the subject of an ongoing criminal investigation, Dunmore sought a stay of the forfeiture proceedings on the grounds that 44 it would be unfair to require ... Dunmore to undergo discovery proceedings including interrogatories and depositions in this action, and perhaps requiring him to exercise his Constitutional Rights under the Fifth Amendment of the United States Constitution to refuse to answer questions that might tend to incriminate him in order to protect himself from the proposed and anticipated criminal charge. 45 Accordingly, the significant delay in this proceeding was occasioned by Dunmore's actions, not the actions of the United States. 46 Dunmore argues that he was forced to request a stay by the United States' decision to proceed contemporaneously against him civilly and criminally. He has not cited, however, and this court has not found any case holding that the United States is precluded from exercising its rights under § 881 contemporaneous with a criminal investigation. This court affirmatively rejects Dunmore's call to create such a blanket rule. A thorough review of the record, especially when viewed in light of Dunmore's request to stay the civil proceeding during the pendency of the criminal investigation and prosecution, reveals that Dunmore's due process rights were not violated by the actions of the United States in this case. 47 Dunmore contends that the Complaint was not sufficiently particular to meet the requirements of Supplemental Federal Rule of Civil Procedure E(2)(a). Tenth Circuit precedent appropriately admonishes that in order to comport with Rule E(2)(a)'s requirement of particularity, the complaint in a civil forfeiture action under section 881 must allege specific facts sufficient to support an inference that the property is subject to forfeiture under the statue. United States v. $39,000 in Canadian Currency, 801 F.2d 1210, 1219 (10th Cir.1986). Although the Complaint in this case was not sufficiently particular upon filing, under the particular facts of this case, the United States' motion for partial summary judgment and its attachments satisfied the requirements of Rule E(2)(a). 48 Shortly after the filing of the Complaint, Dunmore filed a motion for disclosure of the Affidavit. In response to that motion, the United States informed Dunmore that it wished to keep the Affidavit sealed because it contained information relevant to an ongoing criminal investigation of Dunmore. In light of this disclosure, Dunmore moved to stay the civil forfeiture proceeding during the pendency of any further criminal investigation. The district court granted the stay and ordered the United States to inform the court when the criminal investigation was complete. Accordingly, during the pendency of the stay requested by Dunmore, the United States was under no duty to file a more particularized complaint and Dunmore was not disadvantaged because he was not obligated to actively defend the action. 49 After Dunmore's conviction in Missouri on federal drug charges, the United States filed a motion to lift the stay. That same day, the United States filed a motion for partial summary judgment with attachments which clearly and particularly informed Dunmore of the basis of the United States' claim for forfeiture of the personal property. Accordingly, at the very moment the stay was lifted, Dunmore had all of the information which a more particularized complaint would have provided. Thus, under the particular facts of this case, the United States' summary judgment motion satisfied the requirements of Rule E(2)(a) and negated the need for a more particularized complaint. 50 As to Dunmore's allegation that the United States violated his due process rights by seeking a stay of discovery, we note only that the United States does not deny a litigant's due process rights by seeking a court order to protect itself from burdensome and/or frivolous discovery requests. The discovery requests at issue here included a large number of interrogatories directed to non-parties in apparent violation of Fed.R.Civ.P. 33, 10 as well as a request for the production of documents that the United States contends relate to matters that were fully and fairly litigated in Dunmore's criminal trial. In light of the nature of Dunmore's requests, the United States asserts that the district court did not abuse its discretion in refusing to allow the discovery. See GWN Petroleum Corp. v. Ok-Tex Oil & Gas, Inc., 998 F.2d 853, 858 (10th Cir.1993) (noting that a district court's discovery rulings are reviewed for abuse of discretion). 51 Based on the record before this court, Dunmore has not met his burden of demonstrating that the district court abused its discretion in refusing to grant his discovery requests. The interrogatories propounded by Dunmore were apparently directed to persons not parties to this litigation in violation of Fed.R.Civ.P. 33. See University of Texas v. Vratil, 96 F.3d 1337, 1340 (10th Cir.1996) (Under Fed.R.Civ.P. 33(a), interrogatories may only be directed to a party to an action.). More importantly, it is clear from the record before this court that Dunmore was fully apprised of the basis for the United States' forfeiture action through the United States' motion for partial summary judgment, which included as attachments the Affidavit and both testimony and exhibits from Dunmore's criminal trial. Dunmore's contention that the discovery limitations impeded his ability to learn the most basic information concerning the Government's justification for its claims is clearly without merit. The district court did not abuse its discretion in refusing to grant Dunmore's discovery requests. 52 This court can resolve Dunmore's two remaining due process contentions in relatively short order. For the reasons set out in III.B.1, all claims that implicate the validity of the forfeiture of Dunmore's real property should have been brought in the Western District of Missouri as a defense to the criminal forfeiture of that property. As to Dunmore's contention that the United States used this civil proceeding to deny him his right to due process in his criminal trial, we note only that those issues should have been raised by Dunmore in his criminal trial in the Western District of Missouri and his appeal to the Eighth Circuit.