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United States v. Funds in the Amount of One Hundred Thirty-One Thousand Five Hundred Dollars

August 12, 2008

UNITED STATES OF AMERICA, PLAINTIFF,
v.
FUNDS IN THE AMOUNT OF ONE HUNDRED THIRTY-ONE THOUSAND FIVE HUNDRED DOLLARS, ($131,500.00) IN U.S. CURRENCY, AND TWO HUNDRED TWENTY-TWO AMERICAN EXPRESS TRAVELER'S CHECKS IN THE AMOUNT OF ONE HUNDRED ELEVEN THOUSAND DOLLARS, ($111,000.00), DEFENDANT.



The opinion of the court was delivered by: Matthew F. Kennelly, District Judge

MEMORANDUM OPINION AND ORDER

The United States filed this action seeking forfeiture of $131,500 in U.S. currency and $111,000 in traveler's checks seized from an Amtrak passenger on October 9, 2007. The passenger, Richard Lynch, and Steven Komie, his attorney (the "claimants"), have filed claims to the funds. Claimants have moved to dismiss the government's complaint for failure to meet the heightened pleading standards that apply in civil forfeiture actions. For the reasons set forth below, the Court denies claimants' motion.

Facts

The Court takes the following statement of facts from the government's complaint in this case.

On October 9, 2007, federal Drug Enforcement Agency officers assigned to Amtrak Union Station in Chicago conducted what they term a routine investigation of Amtrak's travel manifest and obtained information that on October 8, 2007, passenger Richard Lynch had paid cash for a one-way sleeping car ticket from New York City to Las Vegas via Chicago.

At approximately 3:00 pm on October 9, agents entered Lynch's sleeping car. They later observed Lynch enter his assigned room carrying at least two pieces of luggage. They identified themselves as federal agents and asked to conduct an interview, to which Lynch consented. The agents told Lynch that he was not under arrest and requested his identification and train ticket. After confirming Lynch's identity, they obtained his consent to search his luggage. The agents say that Lynch appeared agitated as he paced the room and that he began to perspire during the search. The agents discovered several bundles of U.S. currency wrapped in Saran Wrap and newspaper in Lynch's backpack. The agents say that at this point, Lynch appeared nervous and fidgety, so as a precautionary measure, one of the agents patted Lynch down and discovered a bulge, which Lynch stated was approximately $200,000 in currency.

Lynch was taken to the DEA office in Union Station, where, the agents say, he agreed to answer additional questions and signed a consent form for the search of his luggage. The agents searched a second piece of luggage in Lynch's possession and found additional U.S. currency. Lynch told the agents that a friend had given him $130,000 in New York to give to another friend from London to whom he owed money. Lynch said he had been told to take the money to Las Vegas, where he would meet the friend from London. The agents say Lynch did not give the two friends' names.

A DEA agent then brought in narcotic detector dog named "Rudy" to examine Lynch's luggage. The government alleges that Rudy is certified annually by the DEA and has made over fifty narcotic "finds" on currency, with no false positives. Rudy reacted positively to the bag containing the seized currency.

In total, the agents seized $131,500 in $100 bills and $111,000 in American Express traveler's checks. On March 7, 2008, the government filed this action for forfeiture, alleging that the funds were furnished and intended to be furnished in exchange for a controlled substance, are the proceeds from the sale of a controlled substance, or were monies used and intended to be used to facilitate narcotics trafficking, and are therefore subject to forfeiture and condemnation pursuant to 21 U.S.C. § 881(a)(6).

Discussion

Claimants have moved to dismiss on the ground that the government has failed to state a claim for forfeiture under 21 U.S.C. § 881(a)(6).Under that provision, "[a]ll moneys [and] negotiable instruments . . . intended to be furnished by any person in exchange for a controlled substance, . . . all proceeds traceable to such an exchange, and all moneys [and] negotiable instruments . . . used or intended to be used to facilitate any violation of this subchapter," that is, a prohibited narcotics transaction, are subject to forfeiture. 21 U.S.C. § 881(a)(6).

By virtue of the Civil Asset and Forfeiture Reform Act (CAFRA), adopted in 2000, "in a suit or action brought under any civil forfeiture statute for the civil forfeiture of any property, the burden of proof is on the government to establish, by a preponderance of the evidence, that the property is subject to forfeiture." 18 U.S.C. § 983(c)(1). In addition, if the government's contention is that the property was used to commit or facilitate or was involved in the commission of a crime, "the government must establish that there was a substantial connection between the property and the offense." Id. § 983(c)(3).

The standard for pleading a complaint in a civil forfeiture action is supplied by the Supplemental Rules for Certain Admiralty and Maritime Claims. See 18 U.S.C. § 983(a)(3)(A). Under Rule G(2)(f) of the Supplemental Rules, a civil forfeiture complaint must "state sufficiently detailed facts to support a reasonable belief that the government will be able to meet its burden of proof at trial." Thus, the government's complaint in this case must provide facts sufficiently detailed to support a reasonable belief that the government will be able to prove by a preponderance of the evidence that the money and traveler's checks seized from Lynch were to be used in or to facilitate a narcotics deal or were proceeds of a narcotics deal, and that the property had a substantial connection to a narcotics offense.

Claimants argue that there is a trend favoring increased scrutiny of civil complaints generally and narcotics forfeiture cases specifically. It is unclear to the Court whether claimants are saying that this should lead the Court to apply a stricter pleading standard than the one set forth in the Supplemental Rules or simply that this trend should inform the Court's application of the standard contained in the Supplemental Rules. Either way, the Court does not see ...


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