Court Opinion

ID: 159853
Source: CourtListenerOpinion
Date Created: 2010-08-14 06:33:05+00
Date Added: 2024-06-11T08:20:31.160773
License: Public Domain

F I L E D
                                                                   United States Court of Appeals
                                                                           Tenth Circuit
                     UNITED STATES COURT OF APPEALS
                                                                           JUN 30 2000
                                   TENTH CIRCUIT
                                                                        PATRICK FISHER
                                                                               Clerk

 UNITED STATES OF AMERICA,

               Plaintiff - Appellee,                      No. 98-5227
          v.                                           (N.D. Oklahoma)
 $189,825.00 (ONE HUNDRED                          (D.C. No. CV-96-1084-J)
 EIGHTY-NINE THOUSAND EIGHT
 HUNDRED TWENTY-FIVE)
 DOLLARS IN U.S. CURRENCY,

               Defendant,
 EDUARDO RANGEL VELAZQUEZ,
 IVAN FARON VELAZQUEZ,

               Claimants - Appellants.

                             ORDER AND JUDGMENT          *

Before BRORBY , ANDERSON , and LUCERO , Circuit Judges.

      The United States brought this civil   in rem forfeiture action pursuant to 21

U.S.C. § 881(a)(6), seeking forfeiture to the government of $189,825.00 in U.S.

      *
       This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
currency found by Oklahoma Highway Patrol officers hidden in the gas tank of a

Dodge pickup truck.

       Eduardo Rangel Velazquez and Ivan Faron Velazquez, respectively, the

driver of and passenger in the vehicle, appeared as claimants and opposed the

forfeiture on the grounds: (1) that the search and seizure of the vehicle and

currency were unreasonable in violation of the Fourth Amendment; (2) that the

government’s complaint did not satisfy the specificity requirement of Fed. R. Civ.

P. Supp. E(2)(a); (3) that the government failed to prove probable cause to

institute the suit, as required by 19 U.S.C. § 1615 because it did not establish the

existence of a reasonable belief that the currency constituted “proceeds traceable”

to a drug transaction within the meaning of 21 U.S.C. § 881(a)(6); and (4) the

seizure would violate the Excessive Fines Clause of the Eighth Amendment.

       The parties consented to have the case tried by a magistrate judge (“district

court” or “court” hereafter), pursuant to 28 U.S.C. § 636(c). The court bifurcated

the proceedings, first holding a three-day bench trial on the claimants’ motion to

suppress on Fourth Amendment grounds and on the issue of probable cause. The

court decided against the claimants on those issues. Then the court proceeded to

a jury trial on the merits. The jury found in favor of the government, and the

court denied the claimants’ Fed. R. Civ. P. 50 motion for judgment as a matter of

law.

                                          -2-
       On appeal, the claimants do not contest the jury verdict but reassert each of

the issues stated above, contending that the district court erred in its disposition

of those issues and in denying judgment as a matter of law to the claimants. For

the reasons stated below, we affirm.      1

                                    BACKGROUND

       The facts of this case are fully developed in the district court’s published

opinion, United States v. $189,825 , 8 F. Supp. 2d 1300, 1303-07 (N.D. Okla.

1998). We refer here only to those facts that are relevant to our discussion of the

issues, and consistent with standards that govern our review. That is, we accept

factual findings by the district court unless they are clearly erroneous, and follow

the court’s credibility determinations.       See United States v. Long, 176 F.3d 1304,

1307 (10th Cir. 1999). With respect to the district court’s denial of the claimants’

motion to suppress evidence, we view the facts in the light most favorable to the

government. See United States v. Villa-Chaparro, 115 F.3d 797, 800-01 (10th

Cir. 1997).

       On May 3, 1996, Oklahoma Highway Patrol Officer Larry Jackson stopped

a 1996 Dodge Ram extended-cab pickup truck on Interstate 44 because the truck’s

       We deny Claimants’ motion to supplement the record with a photograph
       1

from a video tape of the truck. The district court denied the introduction of that
evidence. We conclude that the court did not abuse its discretion.

                                              -3-
driver, Eduardo Rangel Velazquez, changed lanes four times without signaling.

The stop occurred between 7:20 a.m. and 7:30 a.m. Officer Jackson determined

that neither Eduardo nor his passenger, Ivan Faron Velazquez, spoke English.

Jackson escorted Eduardo to the patrol car where Jackson radioed his dispatcher

for an interpreter, and showed Eduardo a driver’s license, indicating his desire to

see Eduardo’s license. In response, Eduardo produced a restricted visa and

Mexican driver’s license, both written in Spanish and largely incomprehensible to

Jackson. Jackson’s radioed request for an interpreter was overheard by Officer

Ron Davis, who responded that he had some Spanish speaking ability and, since

he was in the vicinity, would endeavor to assist. He arrived on the scene in ten

minutes or less.

      While waiting for Davis, Jackson noticed that the truck’s license plate

frame was out of alignment and the left side of the truck’s bumper appeared to be

closer to the tailgate than the right side of the bumper. This aroused Jackson’s

curiosity. He walked around the truck and could not see any evidence of an

accident that would cause the misalignments. He also smelled an odor of

gasoline. Jackson also noted that the truck was fairly new, with approximately

20,000 miles on it. From his training, Jackson knew that Dodge extended-cab

trucks were often used in drug trafficking because they have large gas tanks with

                                         -4-
a six-inch opening for the “sending unit” through which, when the unit is

removed, items can be placed in the gas tank.

      Based on facts known to him at that point, Jackson suspected that the

vehicle might be involved in drug trafficking. He therefore radioed his dispatcher

for a canine unit to conduct at least an exterior sniff of the vehicle. Tulsa Police

Department Officer Ronnie G. LeMaster, an experienced drug detection dog

handler, arrived at the scene about 20-30 minutes later with a dog trained to alert

on the odor of marijuana, cocaine, heroin or methamphetamine. While waiting

for LeMaster, Jackson ran NCIC, EPIC and owner’s registration checks on

Eduardo and Ivan. Those checks showed that the vehicle was owned by Luciano

Chavez of Austin, Texas.

      For traffic safety reasons, Jackson moved the Dodge pickup to a parking lot

less than a mile away at the next I-44 exit. At that point, LeMaster walked his

dog around the truck twice. The dog alerted to the passenger side door both

times. LeMaster then opened the door and the dog alerted on the floorboard and

seat. LeMaster and Jackson then searched the truck, noting leaking gas,

tampering with the support straps for the gas tank, and one broken strap.

LeMaster also observed tool marks on several bolts, indicating to him that the bed

of the truck had been on and off several times, a technique used to access the

sending unit opening in the gas tank. Taps on the gas tank with a nightstick also

                                          -5-
indicated the presence of a solid object that moved around when the truck was

moved and stopped suddenly.

       The officers then took the truck to a nearby filling station to raise it on a

hoist for a more thorough inspection. That inspection disclosed further evidence

that the truck bed had been on and off several times. Jackson then removed the

gas tank and sending unit, which was not secured tightly, looked inside the

opening that housed the sending unit, and observed several plastic bundles.

Subsequently, the officers removed eleven bundles of currency from the tank.

Each bundle was wrapped in three layers of cellophane, vacuum packed, and heat

sealed. When counted, the currency totaled $189,825.00.

       During these events, including the arrival of a more proficient interpreter,

the officers determined that Eduardo and Ivan were from Mexico and were

unlawfully in the Tulsa area. Both denied any knowledge of the hidden currency.

Neither had a criminal record, as shown by the computer checks. No drugs were

found in the vehicle.

                                    DISCUSSION

      A.    Search and Seizure

      The claimants contend that the district court erred when it denied their

motion to suppress evidence of the currency and other evidence discovered after

                                          -6-
their initial traffic stop. They argue that the detention and subsequent search were

unreasonable in violation of the Fourth Amendment; thus, without the resulting

evidence, they were entitled to judgment against the government on the forfeiture

complaint.

         Although this is a civil case, “the government will be barred from

introducing evidence illegally seized in violation of the fourth amendment to prove

a claim of forfeiture.”   United States v. $149,442.43 , 965 F.2d 868, 872 (10th Cir.

1992). We analyze the Fourth Amendment issue here the same way and under the

same authorities used in examining the stop and search of vehicles in criminal

cases.

         Our standard of review regarding the facts is set out above. The ultimate

determination of reasonableness is a question of law that we review de novo.         See

Long, 176 F.3d at 1307.

         The district court’s opinion carefully and thoroughly analyzes this issue.

See United States v. $189,825 , 8 F. Supp. 2d at 1307-11. We adopt its analysis

and reasoning, and conclude that the search and seizure here were reasonable.

         By way of summary, the claimants conceded at argument that the initial stop

was valid. That stop was, of course, limited to its purpose (a traffic violation),

unless the officer developed, during the time permitted for the stop, reasonable

suspicion of other illegal activity.   See United States v. Soto-Cervantes     , 138 F.3d

                                             -7-
1319, 1322 (10th Cir. 1998).       The validity of such suspicion is viewed from the

standpoint of an experienced officer and based on the totality of the circumstances.

See id.

       The district court’s findings regarding the unexplained misalignment of the

bumper, the type of truck used to transport contraband in the gas tank, the odor of

gas, the travel route, and other factors, justified the district court’s conclusion that

the officer’s suspicion was reasonable and justified a limited further detention of

the vehicle and its occupants for a brief additional period for a drug detection dog

walk-around of the vehicle. Valid safety concerns further justified moving the

vehicle a short distance to a parking lot off the highway.

       Once the dog alerted to drugs, the officers had probable cause to search the

vehicle. See United States v. Ludwig , 10 F.3d 1523, 1527 (10th Cir. 1993).

Further probable cause to detain the truck and search the gas tank was developed

at the scene by visual confirmation of tampering with the gas tank, evidence that

the bed of the truck had been removed (a technique for accessing the opening for

the sending unit), and the presence of gas leakage (indicating that the gas tank had

in fact been accessed).   2
                              Removal to a nearby gas station for the purpose of

       The claimants argue that law enforcement advisories regarding the use of
          2

Dodge pickup trucks to transport contraband in their gas tanks referred to a model
other than the one they were driving. Even if true, that fact would not vitiate the
reasonableness of Jackson’s good faith belief that the vehicle he was inspecting
                                                                      (continued...)

                                             -8-
continuing the probable cause search of the gas tank was proper, and the search

there revealed the money.

       This sequence of events did not violate the Fourth Amendment.

       B.       Specificity of the Complaint

       A complaint for forfeiture, such as that filed by the government in this case,

must “state the circumstances from which the claim arises with such particularity

that the defendant or claimant will be able . . . to commence an investigation for

the facts and to frame a responsive pleading.” Fed. R. Civ. P. Supp. E(2)(a).

       We have construed that rule to require the allegation of “specific facts

sufficient to support an   inference that the property is subject to forfeiture under

the statute.”   United States v. $39,660 in Canadian Currency    , 801 F.2d 1210, 1219

(10th Cir. 1986) (emphasis added).

       The claimants contend that the government’s complaint in this case failed to

satisfy these requirements. The district court did not address the issue, and the

parties dispute whether it was raised. We think it was, although not pursued. In

any event, the complaint and attached affidavit filed in this case, included at

Appellant’s App. at 24-31, contain most of the information that we detail in the

      (...continued)
       2

was the type referenced in the advisories.

                                            -9-
next section of this opinion regarding probable cause. Those allegations

unquestionably raise the necessary inference, which is short of showing probable

cause. See United States v. Daccarett , 6 F.3d 37, 47 (2d Cir. 1993)   (“complaint

does not have to meet the ultimate trial burden of showing probable cause for

forfeiture”).

      Furthermore, with respect to the basis for forfeiture that the government

ultimately pursued in this case, the claimants do not demonstrate any material

impediment to their ability to investigate or frame a responsive pleading. And, in

fact, they did frame and file a full responsive pleading. Thus, we are unpersuaded

by the claimants’ arguments on this issue.

      C.        Probable Cause that the Currency is “Proceeds” of a Drug
                Transaction

      Congress has provided that the following shall be subject to forfeiture to the

United States:

      All moneys, negotiable instruments, securities, or other things of
      value furnished or intended to be furnished by any person in exchange
      for a controlled substance or listed chemical in violation of this
      subchapter, all proceeds traceable to such an exchange      , and all
      moneys, negotiable instruments, and securities used or intended to be
      used to facilitate any violation of this subchapter . . . .

21 U.S.C. § 881(a)(6) (emphasis added).

                                          -10-
      Although the government pled more broadly in its amended complaint,       3
                                                                                    the

government’s case proceeded on the theory that the currency in this case

constituted “proceeds” from a drug transaction within the meaning of § 881(a)(6).

It is the allocation of the burden of proof in these cases that underlies the issue

raised by the claimants as to the “proceeds” claim.

      In forfeiture actions “the burden of proof shall lie upon [the] claimant . . .

[p]rovided [t]hat probable cause shall be first shown   for the institution of such suit

or action, to be judged by the court .” 19 U.S.C. § 1615 (emphasis added).

      As to that requirement, we have said:

             [T]he Government bears the burden of going forward, and must
      show probable cause that the property subject to forfeiture is   involved
      in criminal activity . Once this is established, the burden shifts to the
      claimant to prove by a preponderance of the evidence that the
      property is not subject to forfeiture.

$39,660 in Canadian Currency    , 801 F.2d at 1216-17 (emphasis added).

      The claimants contend that the government failed to establish probable

cause that the money hidden in the gas tank constituted proceeds from drug

trafficking, and that the district court erred in denying their Fed. R. Civ. P. 50

motion on this ground. In our analysis of this claim, we first emphasize the

governing standards. As the district court points out, we have said:

       As the district court fully explains in its opinion, the government also
       3

invoked 31 U.S.C. §§ 5316, 5317(c), but did not pursue those claims, and only
presented evidence on the “proceeds” theory under § 881(a)(6).

                                          -11-
       The test for determining probable cause for forfeiture purposes is the
       same as applied in arrests, searches and seizures. Accordingly, the
       government must demonstrate a reasonable ground for belief of guilt
       supported by less than prima facie proof, but more than mere
       suspicion. Circumstantial evidence of drug transactions may support
       the establishment of probable cause . However, the presence or
       absence of any single factor is not dispositive . Once probable cause
       for forfeiture has been established, claimants may recover the
       defendant property only by establishing a defense to forfeiture by a
       preponderance of the evidence.

$149,442.43 , 965 F.2d at 876-77 (internal quotations, citations, and footnotes

omitted) (emphasis added).

       Contrary to arguments made by the claimants, the government is not

required to show that the proceeds probably came from any particular drug

transaction, or such details as the time, location, or amount per transaction.   See

United States v. $36,634, 103 F.3d 1048, 1053 (1st Cir. 1997); United States v.

$4,255,000, 762 F.2d 895, 904 (11th Cir. 1985). The government is only required

to establish probable cause as to a nexus between the proceeds and criminal drug

activity. See Daccarett , 6 F.3d 37, 56 (2d Cir. 1993).

       Applying these standards to the facts here, the district court found a

reasonable belief “that the defendant currency is the proceeds of the sale of a

controlled dangerous substance” based on the following:

       1.     The money was hidden in the gas tank of a Dodge pickup
              truck. Dodge pickup trucks are frequently used by drug
              traffickers because the large gas tank and gas tank
              openings make it easy to conceal drugs and drug
              proceeds. Gas tanks are often used to conceal drug

                                             -12-
     proceeds because the gas and the tank help mask the odor
     of drugs.

2.   Mexico is a known transit zone for drugs headed to the
     United States from Central and South American countries
     and for drug proceeds headed to Central and South
     American countries from the United States.

3.   Several characteristics of the drug courier profile are
     present.

     a.    The truck was being driven by two Mexican
           nationals who did not have proper visas and
           who did not own the truck. The owner of
           the truck was not present and Claimants
           disavowed any knowledge of the currency
           when it was found in the truck’s gas tank.

     b.    The truck was headed south on Interstate 44
           from an interior state to Mexico, a border
           state. I-44 is known to law enforcement
           agencies as a drug pipeline or drug courier
           route.

     c.    The driver and passenger of the truck had
           been on a long trip allegedly for recreation,
           but only had a brief stay at their claimed
           destination before beginning the return trip.

     d.    Neither the driver nor the passenger had
           criminal records.

     e.    The truck was relatively new with high
           mileage.

     f.    There is some evidence to suggest that the
           bed of the truck had been on and off several
           times.

                                 -13-
             g.    It is common for there to be two passengers
                   so that one can driver [sic] and one can sleep
                   while the other is driving. This permits long
                   distances to be covered in a short time.

      4.     The large amount of currency involved.

      5.     The fact that Officer LeMaster’s drug-sniffing canine hit
             on the exterior and interior of the truck, indicating the
             presence of drugs in the truck at some time.

      6.     The unique packaging of the currency – triple-wrapped in
             cellophane, heat-sealed and vacuum-packed. Agent Judd   4

             testified credibly that out of the numerous currency
             seizures he has made, assisted or witnessed, the only
             currency he has seen packaged the way the defendant
             currency was packaged is currency that had some
             connection to drugs. Agent Judd testified that he had
             never seen currency packaged the same as the defendant
             currency that was not connected to drugs. According to
             Agent Judd, currency is packed the way the defendant
             currency was packaged for two reasons: two [sic] mask
             the odor of drugs and to prevent the cash from mildewing
             as the cash makes its way through the jungles of Mexico
             and Central and South America.

$189,825 , 8 F. Supp. 2d at 1313-14 (citations omitted).

      To these facts we add the temporal proximity between the cash and drug

transport in the same vehicle. The truck was only a few months old. The drug

detection dog alert established the probability that during this relatively short time

the truck was used to transport drugs and was being used at the time of the stop to

      Judd, a former FBI and Border Patrol agent, is assistant to the Drug Czar
       4

and advises the President on drug interdiction.

                                         -14-
transport cash, wrapped and secreted in a manner consistent with drug money.

Also during this short time, the truck had crossed into Mexico and had traveled

long distances, consistent with its probable use in drug trafficking – an illegal

business conducted for the money it produces.

       The claimants rely upon numerous cases in which courts have denied

forfeiture, concluding that the government did not establish probable cause. We

have examined them all. None creates any bright line test relevant or controlling

here. Each is clearly distinguishable on its facts. The law is that we determine

probable cause based on the totality of the circumstances in each case.          See United

States v. United States Currency deposited in Account No. 1115000763247             , 176
F.3d 941, 944 (7th Cir. 1999). That is necessarily a case-by-case, fact specific

inquiry. In this case we conclude that, considering all the facts, the government

established probable cause, i.e., a reasonable belief,   5
                                                             that the defendant currency is

proceeds from drug trafficking within the meaning of the statute.         6
                                                                              This reasonable

        The claimants raise various arguments about when the government must
        5

possess the facts necessary for probable cause. The statute clearly refers to the
institution of the suit. In any event, however, the claimants do not demonstrate
that any material part of the facts relied upon by the district court was not known
to the government when it filed its complaint for forfeiture.

       The claimants also argue that the term “proceeds” as used in § 881(a)(6)
        6

does not refer to money, citing Matthew Bender, “Prosecution and Defense of
Forfeiture Cases,” David B. Smith, ¶ 403 [4] (1999). They do not show where
they raised this argument before the district court, and the court did not rule on it.
We will not consider arguments raised for the first time on appeal. See Walker v.
                                                                        (continued...)

                                             -15-
belief was sufficient to shift the burden of proof to the claimants, as provided by

the statute, to prove by a preponderance of the evidence that the defendant

currency was not proceeds from drug trafficking.

         D.    Eighth Amendment Excessive Fines Provision

         We have previously held that the forfeiture of drug proceeds does not

violate the Eight Amendment.     See United States v. Lot 41, Berryhill Farm Estates    ,

128 F.3d 1386, 1395-96 (10th Cir. 1977) (finding “as a matter of law that

forfeiture of drug proceeds pursuant to § 881(a)(6) can never be constitutionally

excessive” and noting that “proceeds produced by an individual drug trafficker is

always roughly equivalent to the costs that drug trafficker has imposed on

society”). Accordingly, we reject the claimants’ argument on this issue.

                                   CONCLUSION

     For the reasons stated above, the judgment of forfeiture is AFFIRMED.

                                                ENTERED FOR THE COURT

                                                Stephen H. Anderson
                                                Circuit Judge

     6
      (...continued)
Mather (In re Walker) , 959 F.2d 894, 896 (10th Cir. 1992)    . In any event, we find
the contention unpersuasive.

                                         -16-