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United States v. Funds in the Amount of One Hundred Thousand and One Hundred and Twenty Dollars

July 5, 2007

UNITED STATES OF AMERICA, PLAINTIFF,
v.
FUNDS IN THE AMOUNT OF ONE HUNDRED THOUSAND AND ONE HUNDRED AND TWENTY DOLLARS ($100,120.00), DEFENDANT.



The opinion of the court was delivered by: Elaine E. Bucklo United States District Judge

MEMORANDUM OPINION AND ORDER

Claimants Nicholas Marrocco ("Marrocco") and Vincent Fallon ("Fallon") have filed a motion for determination of ownership of $100,120.00, the res at issue in this case. Marrocco and Fallon contend that Marrocco is the true owner of the res at issue in this action, and that Fallon has a lawful possessory interest in the res. The government has filed a response contending that the evidence demonstrates that the funds at issue were involved in drug trafficking, so that the government has the true claim of ownership. For the following reasons, I determine ownership belongs to Marrocco.

I.

As explained in my prior rulings, this case is a forfeiture action brought by the government under 21 U.S.C. § 881(a)(6) (2007). The complaint, filed in 2003, alleges that the res is subject to forfeiture because it is connected to narcotics trafficking. These allegations are based on evidence the government obtained when the Chicago Drug Enforcement Agency Narcotic Transportation Task Force Group (the "task force") seized a briefcase containing the res from Fallon at Union Station in Chicago. Fallon and Marrocco filed a motion to suppress evidence and to quash the seizure of the res, contending that the seizure was illegal. At a hearing on the motion to suppress the parties raised the issue of Fallon and Marrocco's standing to bring their motion to suppress. At that time the government contended that Marrocco had no standing to bring the motion to suppress because the Fourth Amendment does not allow claims that "the search of another individual was illegal." (Tr. of Proceedings Apr. 22, 2004 at 2-3.) Marrocco's counsel offered no disagreement to the government's contention. However, at the evidentiary hearing the present counsel for claimants identified himself as representing both claimants. (Tr. of Proceedings, Apr. 26, 2004, at 2.) Both claimants attending the evidentiary hearing. (Id.)

After an evidentiary hearing on the motion to suppress I held that, although the task force lawfully detained the res while it conducted further investigation, the task force lacked the requisite probable cause and warrant to open the briefcase. See United States v. Funds in the Amount of One Hundred Thousand and One Hundred and Twenty Dollars ($100,120.00), 361 F. Supp 2d. 757, 761 (N.D. Ill. 2005) (hereinafter "Funds I"). I consequently granted the motion to suppress the seizure of the res. In granting the motion I made the following factual findings: on the day of the seizure, December 6, 2002, police officer Eric Romano ("Romano") searched records of passengers leaving Union Station and discovered that Fallon had purchased a one-way train ticket to Seattle within 72 hours of the time the train was to depart. Id. at 758. He and another task force agent then approached the train at the time it was boarding and, after determining Fallon had boarded, approached his train compartment and spoke to him. Id. at 759. The officers asked Fallon where he was going and the purpose of his visit, and asked Fallon if he was carrying drugs, large sums of money, or weapons. Id. At this point, Fallon was sweating. Id. The officers then asked and received permission to search Fallon's backpack, and found nothing incriminating. They then asked for permission to search the briefcase containing the res at issue, but Fallon told them no. Fallon did, however, tell them that the briefcase contained $50,000 in cash, that it was locked, and that he did not have a key but used a knife to open it. Id. The officers then told Fallon to come with them inside the station for additional questioning, and he did so. Id. at 760. The officers frisked, photographed and fingerprinted Fallon, and photocopied his tickets and ID. Id. The officers requested that police dispatch send a police dog to conduct a sniff search of the briefcase.

In response to questions, Fallon gave the officers conflicting explanations about why he had the money, including that he was going to buy a house or artwork, that he had the cash because he had worked as a waiter, and that he had other unnamed investors whose money was in the briefcase. Id. At this point, Romano opened the briefcase and saw that it contained money. Id. At some point thereafter, the police dog arrived and gave a positive alert that the briefcase contained drugs or money that had been contaminated with drugs. Id. Based on this set of circumstances, I concluded that the search of the briefcase was unlawful because it was not supported by probable cause. Id. at 761-62. I further concluded that, because once the officers asked Fallon to leave the train he was in a custodial setting, the statements he made had to be suppressed because the officers had not given him a Miranda warning. Id. at 762 n.1. I denied the government's motion to reconsider. United States v. Funds in the Amount of One Hundred Thousand and One Hundred and Twenty Dollars ($100,120.00), No. 03 C 3644, Order at 2 (N.D. Ill. Sept. 21, 2006).

Criminal charges were never filed against either Fallon or Marrocco. Recently, Fallon and Marrocco filed a motion for return of property. I denied that motion as premature since Fallon and Marrocco had not yet presented any evidence indicating their ownership of the res. United States v. Funds in the Amount of One Hundred Thousand and One Hundred and Twenty Dollars ($100,120.00), No. 03 C 3644, Order at 2-3 (N.D. Ill. Apr. 10, 2007) (hereinafter "Funds II"). Fallon and Marrocco responded by filing the present motion, along with an affidavit from Marrocco stating that he is the lawful owner of the res and that it represents a portion of his savings from lawful employment. (Pls'. Mot. for Return of Prop. Ex. B.) Their motion contends that it is "undisputed" that Fallon was a "mere possessor" of the res and that, because Marrocco has claimed ownership of the res, he is legally entitled to the res. (Pls'. Mot. for Return of Prop. at ¶¶ 10-14.)

II.

Under the forfeiture statute the government seeks to apply to seize the res at issue:

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 [subchapter I of Chapter 13 of Title 21] are subject to forfeiture to the United States. 21 U.S.C. § 881(a)(6). Under the Civil Asset Forfeiture Reform Act of 2000 ("CAFRA"), 18 U.S.C. § 983(c)(1), the government must show by a preponderance of the evidence that the present res is subject to forfeiture. Section 983 also requires that, in cases such as this one where the government's theory of forfeiture is that the money to be forfeited was "used to commit or facilitate the commission of a criminal offense," the government must "establish that there was a substantial connection between the property and the offense." 18 U.S.C. § 983(c)(1); see also United States v. Funds in the Amount of Thirty Thousand Six Hundred and Seventy Dollars ($30,670.00), 403 F.3d 448, 454 (7th Cir. 2005) (explaining standard for civil forfeitures initiated after the passage of CAFRA). It is only after the government meets its burden that the burden shifts to the claimant to prove that the property is not subject to forfeiture. United States v. All Assets and Equip. of West Side Bldg. Corp., 58 F.3d 1181, 1188 (7th Cir. 1995) (citation omitted) (decided under lower pre-CAFRA "probable cause" standard); United States v. One 1991 Chevrolet Corvette, VIN: 1G1YY3385M5109893, 895 F. Supp. 210, 211-12 (N.D. Ill. 1995)(same). Even if the government is not able to meet its burden, however, the claimants still must demonstrate lawful entitlement to the property. See, e.g., Alli-Balogun v. United States, 281 F.3d 362, 371-72 (2d. Cir. 2002) (decided under pre-CAFRA standard).

III.

The claimants' motion asks me to find that Marrocco is the lawful owner of the res and that Fallon has a lawful possessory interest in the res. The government argues that it is the lawful owner and that the evidence shows that the res is subject to forfeiture. Its arguments center around the contention that, although I quashed the seizure and excluded evidence obtained as a result of the seizure (including the results of the sniff test performed by the police dog), this evidence is still admissible to determine whether Marrocco is the lawful owner. I agree with the government that I may not simply return the res to Fallon, because he is only asserting a possessory interest in the res. That interest is good only against all others but the rightful owner of the property. See Reliance Ins. Co. v. AL E. and C., Ltd., 539 F.2d 1101, 1105 (7th Cir. 1976) (relying on Indiana law); U.S. v. $38,000.00 Dollars in U.S. Currency, 816 F.2d 1538, 1544 (11th Cir. 1987)(citing Reliance). Unless the government can prove that the res is subject to forfeiture, the rightful owner of the res appears to be Marrocco, since he asserts that he is the lawful owner and no other claimant has appeared. Therefore, I must consider whether the government has met its burden of proof to seize the res from Marrocco.

Here the government contends that it has met its burden of proof to show that the res was involved in drug trafficking because of the evidence uncovered when the task force stopped Fallon at Union Station, specifically that (1) Fallon initially lied about the briefcase containing money; (2) Fallon acted nervous; (3) Fallon gave the task force conflicting explanations for why he had the money; and of course (4) the drug detection dog alerted to the briefcase containing the res. In a case similar to this one, a case that the government cites throughout its response, the Seventh Circuit addressed the propriety of summary judgment in a civil forfeiture case. Thirty Thousand Six Hundred Seventy Dollars, 403 F.3d at 450-53. In that case, the authorities seized the money at issue after the claimant was stopped at the airport, initially lied to the authorities about carrying a large amount of currency, and then gave an improbable explanation for why he was carrying currency and how he had obtained it. Id. The authorities subsequently used a drug detection dog to conduct a sniff test on the seized currency and the dog alerted to a plastic bag containing the seized money. Id. at 451. The Seventh Circuit noted that under these facts, "the propriety of this forfeiture case turns on the dog alert evidence" because without that evidence "the government cannot possibly link [the money at issue] to illegal narcotics activity." Id. at 453. The same is true here. The government has presented no evidence that would establish a "substantial connection" between this res and narcotics trafficking other than the purported results of the drug detection dog's "sniff test" of the currency.*fn1 Therefore, it is the admissibility of this evidence as to Marrocco that I must consider.

This leads to the critical question of Marrocco's standing to assert a Fourth Amendment challenge to the government's seizure of the res. Claimants' motion for a determination of ownership of the res assumes, as does their reply, that this evidence must be suppressed as to both Marrocco and Fallon. The government contends in its response that Marrocco lacks standing to object to the introduction of the drug detection dog's sniff test because "Fourth Amendment rights are personal rights that cannot be vicariously asserted." (Gov't's Resp. at 2-3 (citing Alderman v. United States, 394 U.S. 165, 174 (1969); Henning v. O'Leary, 477 F.3d 492, 495 (7th Cir. 2007); United States v. Williams, 951 F.2d 853, 856 (7th Cir. 1992)).) However, these cases do not preclude Marrocco from asserting a claim. The motion to suppress was filed by both Marrocco and Fallon. At the evidentiary hearing on the motion to suppress, claimants' counsel identified himself as representing both claimants, and the government did not indicate at that time ...


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