Opinion ID: 178905
Heading Depth: 3
Heading Rank: 2

Heading: The Trust's interest in the diamond

Text: Pursuant to 21 U.S.C. § 853(n)(6), a district court can amend an order of forfeiture in only two circumstances. The first of these circumstances is where the petitioner has a legal right, title, or interest in the property that was vested in the petitioner... or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property. Id. § 853(n)(6)(A). Amending an order of forfeiture is also appropriate where the petitioner is a bona fide purchaser for value of the right, title, or interest in the property and was at the time of purchase reasonably without cause to believe that the property was subject to forfeiture under such section. Id. § 853(n)(6)(B). To succeed on a petition to amend a forfeiture order, a claimant must establish ownership by a preponderance of evidence. Id. § 853(n)(6). The Trust does not argue that it was a bona fide purchaser of the diamond, so we need address only whether the Trust had a vested interest in the diamond when the acts giving rise to the money-laundering conspiracy occurred. Both parties agree that Ohio law governs. We must therefore determine (1) whether the Trust had a legal right, title, or interest in the diamond, and (2) if so, whether that right, title, or interest vested prior to the government obtaining its interest. Turning to the first issue, we note that there is no dispute that the first person to possess the diamond among all of the interested parties was Monea. There is also no evidence of any document granting the Trust an ownership interest in the diamond. In light of these facts, the district court limited its analysis to whether Monea had gifted the diamond to the Trust, thereby implying that this was the only remaining method that could have resulted in the transfer of ownership from Monea to the Trust. Neither side has indicated that any other method of transfer occurred. Two conditions must be met under Ohio law for a gift to be made. First, there must be an intention on the part of the donor to transfer the title and right of possession of the particular property to the donee. Bolles v. Toledo Trust Co., 132 Ohio St. 21, 4 N.E.2d 917, 920 (1936). Second, there must be a delivery by the donor to the donee of the subject-matter of the gift to the extent practicable or possible considering its nature, with relinquishment of ownership, dominion, and control over it. Id. Each of these conditions must be supported by clear and convincing evidence. Id. Because this standard is higher than that for establishing an ownership interest under 21 U.S.C. § 853(n)(6), a finding that Monea gifted the diamond to the Trust would necessarily result in a finding that the Trust has an ownership interest in the diamond. Regarding the question of donative intent, the district court concluded that, [a]t best, ... Monea's repeated assertions that the diamond was an asset of the Trust evidenced his intent to make a gift to the Trust. Neither party has challenged the court's ruling in this regard. We therefore turn our attention to the second elementwhether Monea delivered the diamond to the Trust by relinquishing ownership, dominion, and control over it. The Trust contends that such delivery took place when Ramsey picked up the diamond from the jeweler in Oklahoma because Ramsey was acting as an agent of the Trust at that time. Once Ramsey retrieved the diamond, however, he never gave it to the Trust. Rather, Monea permitted Deleo to have the diamond for two to three weeks while shopping it to potential buyers. There is no evidence that the Trust approved or was ever aware of this arrangement. Upon repossessing the diamond, Monea typically carried it in his pants pocket, with Ramsey sometimes doing the same. On the other hand, Miller, then serving as the trustee, never had the diamond in his possession and had no input on where the diamond would go and where it would be. The fact that Monea and Ramsey never surrendered possession of the diamond to the trustee weighs strongly against a finding of delivery to the Trust. See LCP Holding Co. v. Taylor, 158 Ohio App.3d 546, 817 N.E.2d 439, 445 (2004) (holding that delivery occurred when appellee surrendered possession of the stock and endorsed the stock to his children as owners). In addition to not surrendering possession of the diamond, Monea continued to keep it for his personal use. He promised Deleo an interest in the diamond in exchange for money to pay off Monea's debt to Dillard and to have the diamond readied for sale. Soon thereafter, Monea and Ramsey entered into a Certificate of Giving with Charity Fellowship of Truth Church that granted the church a 50 percent security interest in the diamond. Although Ramsey stated in the Certificate that he was acting on behalf of the Trust, Miller denied any knowledge of the church obtaining an interest in the diamond or that Monea and Ramsey were even participating in such negotiations. Miller was also never informed that Monea, Ramsey, and Reverend Moore were showing the diamond to potential buyers in Los Angeles and Las Vegas or that Reverend Moore at times had sole custody of the diamond. The Trust defends these actions by claiming that both Monea and Ramsey were acting as agents of the Trust, but we find this argument unpersuasive. There is no evidence in the record that the Trust ever appointed Monea to be an agent or entrusted him with the diamond in any other capacity. In fact, the only evidence that Monea was negotiating on behalf of any party is when he signed the purchase agreement as a trustee of the church. And although documentation exists appointing Ramsey as an agent of the Trust, it specifically limited his authority to the purpose of delivering $500,000 (Five Hundred Thousand Dollars) payment to Mike Dillard and the receipt of any material at the time of payment. Monea and Ramsey then proceeded to engage in negotiations to sell the diamond not only without the Trust's knowledge, but also well beyond any scope of agency that either potentially had with the Trust. The evidence also shows that the primary beneficiary of these negotiations was to be Monea himself rather than the Trust. Monea sought ownership of the Massillon lake house so that he could continue to entertain business clients at the residence, and the majority of the proceeds from the planned December 2006 sale of the diamond was earmarked for Monea's personal debts and investments. He even referred to the gemstone as my diamond on at least one occasion during conversations with potential buyers. And because Monea continued to use the diamond for his own purposes and did not surrender possession of it, delivery of the diamond to the Trust never occurred. The Trust nevertheless contends that testimony from the forfeiture hearing regarding its ownership of the diamond was unrebutted and therefore conclusively establishes that the diamond was a Trust asset. To support this assertion, the Trust relies upon Howard v. Himmelrick, No. 03AP-1034, 2004 WL 1405293 (Ohio Ct. App. June 24, 2004). In Howard, the fiancée of a recently deceased man sued to recover possession of several pieces of personal property located in the man's home when he died, but which she claimed were hers. Following a hearing, the trial court determined that the property belonged to the fiancée. The man's children, who had refused to surrender possession of the items, argued on appeal that this ruling was against the manifest weight of the evidence. Although the only evidence that the fiancée had retained ownership of the property was her own testimony, there was no other evidence refuting her statements. The Ohio Court of Appeals held that such unrebutted testimony was competent and credible evidence of ownership and, accordingly, that the trial court's ruling was not against the manifest weight of the evidence. Id. at . But the Trust misreads Howard. In that case, the deceased's children challenged the trial court's determination that the disputed personal property belonged to the fiancée. The Ohio Court of Appeals rejected the children's argument in light of the fiancée's testimony that she had not given the items to the deceased and the lack of any evidence to the contrary. Howard, 2004 WL 1405293, at . In contrast, there is significant evidence in the present case supporting the conclusion that Monea never made a gift of the diamond to the Trust. Howard is therefore distinguishable. In sum, the Trust has not shown by clear and convincing evidence that Monea ever relinquished ownership, dominion, and control over the diamond. See Bolles v. Toledo Trust Co., 132 Ohio St. 21, 4 N.E.2d 917, 920 (1936). The district court thus did not err in finding that no gift had been made. We therefore have no need to address the Trust's claim that its interest in the diamond vested prior to the government's forfeiture claim.