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United States v. Funds In Amount of $271

United States District Court, N.D. Illinois, Eastern Division

September 18, 2014

UNITED STATES OF AMERICA, Plaintiff,
v.
FUNDS IN THE AMOUNT OF $271, 080.00, Defendant, PEDRO CRUZ-HERNANDEZ and ABRAHAM CRUZ-HERNANDEZ, Claimants.

MEMORANDUM OPINION & ORDER

JOAN B. GOTTSCHALL, District Judge.

This case is an in rem forfeiture action for $271, 080 in cash seized from a safe in a minivan parked in the driveway of a North Chicago residence. The government believes that the funds were used in narcotics trafficking and seeks forfeiture of the funds under 21 U.S.C. § 881(a)(6). Pedro Cruz-Hernandez and Abraham Cruz-Hernandez argue that they are the rightful owners of the funds and were involved in no criminal activity. They submitted a claim for release and return of the funds.

Now before the court is the government's motion for summary judgment. The government argues that the claimants lack standing to contest forfeiture of the currency. In the alternative, the government seeks summary judgment because the funds were used (or intended to be used) to facilitate narcotics trafficking. For the reasons discussed below, the motion is denied.

I. BACKGROUND FACTS

The following facts are not in dispute unless otherwise indicated.[1] The claimants agree "that the basic facts are not in dispute, i.e., that law enforcement officers seized and searched a black safe from a locked vehicle and uncovered $271, 080.00 in U.S. Currency." (Claimants' Resp. 2-3, ECF No. 45.)

At about 1:00 a.m. on June 9, 2012, North Chicago Police Department (NCPD) officers responded to a 911 call reporting an apparent home invasion at 2124 Kemble Avenue in North Chicago, Illinois. Upon their entry into the residence, NCPD officers discovered that the apparent intruders were not present. While inside the residence, NCPD officers say they observed in plain view a 9mm handgun, plastic bags, cannabis, a digital scale with white powder residue, a knife, and zip-tie plastic fasteners.

The officers observed three vehicles parked in the driveway behind the residence, including a red Chevrolet minivan. A Lake County Deputy Sheriff, who is also a K-9 handler, and a canine owned by the Lake County Sheriff's Department, conducted a narcotic-odor investigation of the exterior of the three vehicles. The canine alerted to the presence of narcotics on the van.[2]

Within the rear of the minivan, NCPD officers observed a black safe in plain view through the windows. A circuit-court judge in Lake County issued a warrant to search the residence and minivan and seize evidence, including cash and safes. In addition to the search warrant, claimant Pedro Cruz-Hernandez and a co-resident of 2124 Kemble signed a consent form for NCPD officers to search the residence.

Officers conducted a search of the residence, minivan, and safe. The officers found $271, 080 in cash in the safe, bundled together with elastic ponytail rubber bands in increments labeled "$5, 000." NCPD officers found a handwritten ledger inside the safe that appears to contain dollar amounts, dates, and names.

When questioned by North Chicago police on June 9, 2012 about the safe, Pedro Cruz-Hernandez said: "I honestly don't know what is inside." (Tr. of Interview 16, ECF No. 43-5). The police inquired: "[Y]ou didn't know that there was money inside? It's not yours?" and Pedro Cruz-Hernandez replied, "It is not mine, no, it isn't." In a deposition taken in conjunction with this case, Pedro Cruz-Hernandez confirmed under oath that his answers on June 9, 2012 "were truthful and complete." (Dep. of Pedro Cruz-Hernandez 43, ECF No. 43-9.)

Claimant Abraham Cruz-Hernandez has also made statements indicating that the money in the safe was not his. He filed an Application for Cancellation of Removal in removal proceedings before the Immigration Court for the U.S. Department of Justice, Executive Office of Immigration Review. That application states that from December 2004 to August 2012, Abraham Cruz-Hernandez resided at 2124 Kemble. The application states that Abraham Cruz-Hernandez's only assets are $2, 000 in cash, stocks, or bonds that he owns jointly with his spouse. In a deposition, Abraham Cruz-Hernandez stated under oath that the information he provided in his application was true, accurate, and complete. (Dep. of Abraham Cruz-Hernandez 19, ECF No. 43-10.)

On February 11, 2013, the claimants filed a formal claim for the seized $271, 080. The claim states that the claimants "are the lawful, legitimate and rightful owners of all $271, 080.00 U.S. Currency seized" and that "Claimants were not involved in any criminal activity whatsoever. If any criminal activity occurred, claimants were innocent owners and did not know of the conduct giving rise to the forfeiture." (Claim ¶¶ 1, 3, ECF No. 7.) Both claimants signed the claim "[u]nder oath and being subject to the penalties of perjury." ( Id. at 2.) The claimants also submitted affidavits claiming ownership of the funds.

II. LEGAL STANDARD

Summary judgment is appropriate when the movant shows there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56; Smith v. Hope Sch., 560 F.3d 694, 699 (7th Cir. 2009). "[A] factual dispute is genuine' only if a reasonable jury could find for either party." SMS Demag Aktiengesellschaft v. Material Scis. Corp., 565 F.3d 365, 368 (7th Cir. 2009). The court ruling on the motion construes all facts and makes all reasonable inferences in the light most favorable to the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Summary judgment is warranted when the ...


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