In the Matter of Property Seized for Forfeiture from Darrell Anthony Jones ( 2024 )

IN THE COURT OF APPEALS OF IOWA
No. 23-1248
Filed October 30, 2024
IN THE MATTER OF PROPERTY SEIZED FOR FORFEITURE FROM DARRELL
ANTHONY JONES,
DARRELL ANTHONY JONES,
Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Wapello County, Greg Milani, Judge.
Appellant appeals the district court’s combined forfeiture order forfeiting
$85,000 in U.S. currency to the State. AFFIRMED.
Jamie Hunter of Dickey, Campbell & Sahag Law Firm, PLC, Des Moines,
for appellant.
Brenna Bird, Attorney General, and Martha E. Trout, Assistant Attorney
General, for appellee State.
Heard by Tabor, C.J., and Ahlers and Sandy, JJ.
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SANDY, Judge.
During two separate searches of Darrell Jones’s residence, police officers
seized over $85,000 in U.S. currency. This figure included a mix of cash found on
Jones’s person and in the residence, as well as funds in a bank account belonging
to Jones. Items typically associated with drug dealing and substantial quantities
of marijuana were also seized by the police during the searches of Jones’s
residence.
The State filed two in rem forfeiture complaints against Jones, seeking to
have the U.S. currency seized during the searches forfeited to the State. In both
complaints, the State alleged the U.S. currency were “proceeds” of “conduct giving
rise to forfeiture,” as defined by Iowa Code section 809A.4(3) (2020). The district
court held a combined forfeiture hearing for the two forfeiture actions. The district
court found that the currency seized “were used in the commission of or proceeds
from the crimes committed and pled guilty to by [Jones].” Thus, the currency was
forfeited to the State.
Jones appeals, arguing that (1) there was not substantial evidence that all
the currency forfeited were the proceeds of marijuana distribution; (2) the
forfeitures amount violates the excessive fines clause of the state and federal
constitutions; and (3) the district court lacked subject matter jurisdiction over one
of the forfeiture actions.
After our review of the record, we affirm.
I. Background Facts and Proceedings
On January 14, 2020, Jones was pulled over for a traffic stop two separate
times by deputies with the Wapello County Sheriff’s Office. During the first stop,
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Deputy Aaron McConnell smelled the odor of marijuana emanating from Jones’s
vehicle. When questioned about the smell, Jones told Deputy McConnell that his
brother had recently smoked a marijuana blunt in the vehicle. A few hours later,
Jones was pulled over by Chief Deputy Marty Wonderlin. During his interaction
with Deputy Wonderlin, Jones stated he had previously served four years in prison
for cocaine distribution. Following the stops, the deputies applied for a search
warrant for Jones’s residence in Ottumwa.
After the search warrant was granted, officers waited to execute the warrant
until the January 23 due to staffing and officer safety concerns. On January 18,
Jones contacted the Wapello County Sheriff’s Office to request a salvage vehicle
inspection. Among other odd-jobs, Jones runs a side business of buying and
flipping salvaged vehicles. Sheriff’s Deputy Todd Evans met with Jones at an
agreed-upon location on January 23 to conduct a salvage vehicle inspection.
Once the vehicle inspection was completed, Jones was arrested pursuant to an
outstanding warrant for a driving-while-barred charge. While conducting a search
incident to arrest, $2470 in cash was found on Jones’s person. This dollar amount
was comprised mostly of smaller denominations—five, ten, and twenty-dollar bills.
Two cellphones were also found on Jones’s person.
Following Jones’s arrest, deputies with the sheriff’s office transported him
to his residence and executed the search warrant. While the search was being
conducted, Jones made numerous incriminating statements to officers. 1 He told
1 The record is conflicting on when this search in January 2020 occurred. In its in
rem forfeiture complaint, the State represented that the property discovered during
the January 2020 search was seized on January 18 and 24. The district court in
its ruling listed the search date as January 18. However, reports from officers with
4
officers they would find marijuana in the residence. Jones also admitted to selling
“high quality” marijuana. He explained to the officers that he obtained marijuana
from a wholesale supplier in quarter pound quantities. Additionally, Jones
indicated to officers that they would find incriminating information related to
marijuana distribution on his cell phones if they were searched. Lastly, Jones told
the officers he had not been employed for nearly a year at the time of the search,
and that he had not received any unemployment compensation during the previous
six months.
During this search of Jones’s residence, officers found $6880 cash inside a
coat hanging in a bedroom closet, counterfeit currency, forty-two grams of
marijuana, 100 small plastic baggies, eight cell phones, three digital scales, and a
receipt to a bank account at Community 1st Credit Union in Ottumwa. The receipt
for the bank account showed an account balance of $39,952. The officers seized
each of these items and subsequently seized $31,535 from Jones’s bank account.
Through subpoenaing Community 1st Credit Union, officers learned that
Jones opened the account in March 2019. Information officers obtained from the
credit union showed Jones frequently made large deposits of cash into the
account, which were usually comprised of large sums of smaller denomination
bills. For instance, on August 30, 2019, Jones deposited $6540 in cash. Of this
number, $1800 was in one-hundred-dollar bills, $1050 was in fifty-dollar bills,
$3640 was in twenty-dollar-bills, and $50 was in ten-dollar bills. The district court
the sheriff’s office—which were admitted into evidence—stated the search
occurred on January 23. Testimony from Sherriff’s Deputy Clint Neis also indicates
the search occurred on January 23.
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heard testimony from Sherriff’s Deputy Clint Neis that such large sums of money
comprised of smaller denominations were consistent with drug dealing. As Deputy
Neis explained, “the majority of drug deals are done with smaller denomination
bills, such as 20s, 10s, and the majority of the deposits into that account were large
sums of cash in smaller denominations.”
Following the January 23 search, Jones pled guilty to money laundering,
possession of a controlled substance with intent to deliver, failure to affix a drug
tax stamp, and perjury. The perjury charge stemmed from Jones’s failure to
disclose the existence of the Community 1st Credit Union account to the district
court in his application for court-appointed counsel. The basis for the money
laundering charge was allegations that Jones used his business of buying and
selling salvage vehicles as a front to launder the profits of his drug trafficking.
Jones again came to the attention of the Wapello County Sheriff’s Office on
November 20, 2020. That evening, the Ottumwa Police Department responded to
reports of a domestic fight occurring at Jones’s residence. Allegedly, Jones and a
female companion were involved in physical altercation over money. Upon arriving
at the residence, officers noticed a strong odor of marijuana. Ottumwa police
officers quickly contacted deputies at the sheriff’s office. A deputy with the sheriff’s
office then applied for and was granted a search warrant for Jones’s residence.
During this search of Jones’s residence, officers found $2500 in cash on a
living room chair, $350 in cash next to an electric heater in the living room, $7460
in cash in an envelope next to the same electric heater, $284 in a bread storage
container located in the living room, and $41,020 in cash in a silver bag found in a
car located on the property. In total, the officers seized $51,614 in cash from the
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residence. Officers also found a backpack filled with marijuana in a shed in the
backyard. The backpack contained three separate bags of marijuana that, when
added together, amounted to over 600 grams. Officers also found multiple digital
scales in the residence, three cellphones, packaging materials and numerous
baggies, a nine-millimeter handgun, a .22-caliber rifle, and a significant amount of
ammunition for the rifle.
On April 21, 2020, the State filed an in rem forfeiture complaint requesting
that the $36,3652 in U.S. currency seized during the January 23 search be forfeited
to the State. Jones filed a handwritten answer to this complaint, which asserted
“[t]he property seized was not or has nothing to do with illegal activity.” Jones also
asserted he had supporting evidence and asked for further proceedings. On
December 10, 2020, the State filed an in rem forfeiture complaint for the property
seized during the November 20 search. In this complaint, the State requested that
the $51,614 in U.S. currency seized be forfeited to the State. Jones filed an answer
asserting that he and Siearre Smith were “claimants” of the property seized on
November 20.
A combined forfeiture hearing was held in the district court on February 2,
2023. Jones appeared as a self-represented litigant. Jones testified he earned
the $36,365 by buying and selling salvaged vehicles. As Jones explained, “I was
in the business of buying and selling cars, so that money was part of what I was
doing, like, selling my cars and stuff.” Jones offered several exhibits into evidence,
2 In its initial complaint, the State requested that $41,405 in U.S. currency be
forfeited to the State. However, this complaint was later amended to request that
only $36,365 of the U.S. currency seized be forfeited.
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including bank statements and transaction summaries for his Community 1st
Credit Union account, a list of vehicles he purchased, and a bank statement for an
account he had with US Bank. Jones also offered several tax documents showing
income he earned in 2017 and 2018. He offered documentation showing
unemployment compensation he received in 2019 as well.
As for the $51,614, Jones similarly maintained he earned this money from
buying and flipping vehicles. As Jones testified, “[b]ut by that time, I had learned
how to go buy and sell cars. So when I was out of work, that’s what I started
investing my money into and what I started doing with my money was buying cars,
selling cars, and things like that nature.” According to him, it was “crazy” to “think
that this type of money had been made off marijuana.” Jones also explained that
the $41,020 in cash found in a vehicle located on the property was money he and
Smith intended to use to purchase a home together. Jones asserted some of the
currency seized on November 20 belonged to Smith, but she did not participate in
the proceedings after filing an initial answer.
The district court subsequently entered a combined forfeiture order. The
district court found that the $36,635 in U.S. currency seized during and after the
January 23 search “were the proceeds from the illegal activities to which [Jones]
was participating in and charged with and subsequently [pleaded] guilty to.” Thus,
the district court deemed this money was forfeited to the State. Likewise, the
district court found the $51,714 in U.S. currency seized during the November 20
search were the proceeds of Jones’s illegal activities. This money was also
forfeited to the State.
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Jones appeals the district court’s ruling, arguing that (1) there was not
substantial evidence that all of Jones’s cash and bank accounts were proceeds of
selling marijuana; (2) the forfeiture of over $85,000 violates the excessive fine
clauses of the state and federal constitutions; and (3) the district court lacked
subject matter jurisdiction over the forfeiture action stemming from the January 23
search.
II. Standard of Review
Our review of “forfeiture proceedings is for correction of errors at law.” In re
Young, 780 N.W.2d 726, 727 (Iowa 2010). “We examine the evidence in the light
most favorable to the district court judgment and construe the district court’s
findings liberally to support its decision.” In re Prop. Seized from Chiodo, 555
N.W.2d 412, 414 (Iowa 1996). The district court’s findings are binding upon us if
they are supported by substantial evidence. In re Prop. Seized from DeCamp, 511
N.W.2d 616, 619 (Iowa 1994). Evidence is said to be “substantial if a reasonable
mind would accept it as adequate” to reach a similar conclusion. Id.To the extent a party raises constitutional issues, our review is de novo.
Kragnes v. City of Des Moines, 810 N.W.2d 492, 498 (Iowa 2012).
III. Analysis
A. Sufficiency of the Evidence
Property subject to forfeiture includes “[a]ll proceeds of any conduct giving
rise to forfeiture.” Iowa Code § 809A.4(3). In turn, conduct giving rise to forfeiture
is defined as “[a]n act or omission which is a public offense and which is a serious
or aggravated misdemeanor or felony.” Id. § 809A.3(1)(a). “Proceeds” are
defined as “property acquired directly or indirectly from, produced through, realized
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through, or caused by an act or omission and includes any property of any kind
without reduction for expenses incurred for acquisition, maintenance, production,
or any other purpose.” Id. § 809A.1(7) (emphasis added).
For clarity, we divide our analysis according to the currency seized in the
separate searches.
1. Currency Forfeited from the January 2020 Search3
Jones contends on appeal that “just because [he] admittedly sold some
marijuana does not mean the State is entitled to every dollar in [his] possession
including the entirety of his bank account.” Jones claims the State offered no
estimate of the total proceeds realized from his marijuana distribution enterprise.
He also notes his Community 1st Credit Union account was opened well before
the evidence of his drug trafficking was presented. He argues it is undisputed that
he earned income from his employment with “JBS/Swift Pork,” received
unemployment compensation for twenty-six weeks in 2019, and that he earned
considerable income by buying and selling salvaged vehicles. Thus, he asserts
“there can be no dispute that a significant portion, if not all, of the money in his
bank account came from legitimate means.” At a minimum, Jones contends the
State should be required to return the $31,535 seized from his bank account. We
believe Jones’s arguments miss the mark for the reasons detailed below.
3 Jones’s argument related to the currency seized as a result of the January 2020
search seems primarily focused on the $31,535 seized from his bank account. He
makes little to no mention of the cash seized during the January 2020 search.
However, for the same reasons as we discuss below concerning the currency
seized from his bank account, we believe the State produced substantial evidence
the cash seized during the January 2020 search were the proceeds of marijuana
trafficking.
10
We begin by noting Jones is correct that he introduced into evidence several
exhibits demonstrating he earned sporadic income from 2017 to 2019. For
example, he introduced into evidence a copy of a tax return transcript showing that
he earned $11,855 in 2017 and $57,587 in 2018. He also introduced a document
showing he received $12,142 in unemployment compensation in 2019. We also
acknowledge Jones provided a list of salvage vehicles he has purchased dating
back to 2018.
However, we are not convinced such evidence establishes the $31,535
seized from Jones’s bank account was derived from legitimate means. We note
the record establishes the Community 1st Credit Union account was opened on
March 27, 2019. According to statements Jones made to officers during the
January 2020 search, he was unemployed at this time. Yet a transaction summary
for the account offered into evidence by Jones shows a litany of large cash
deposits were made into the account over the next year—a period in which the
State points out Jones was unemployed. Like the district court, we are not
convinced the timing and size of these deposits can be attributed to income Jones
earned in 2017 and 2018. To believe so would require us to believe Jones was a
greater miser than Ebenezer Scrooge. See Charles Dickens, A Christmas Carol
(1843).
And while Jones did introduce into evidence documentation confirming he
purchased salvaged vehicles, this documentation did not show how much he
earned from selling those vehicles. Jones’s testimony also provided no information
relative to how much income he earned from buying and selling salvaged vehicles.
Jones pled guilty to money laundering following the January 2020 search. The
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factual basis for the plea was that Jones used his salvage vehicle business to
launder the profits from his marijuana trafficking. This cast doubt on Jones’s claim
the funds in his bank account came from buying and selling salvage vehicles.
More importantly, the State presented substantial evidence connecting the
funds in the bank account to marijuana trafficking. The record reflects that the
large deposits made into the bank account were frequently comprised of smaller
denomination bills. Deputy Neis testified at the forfeiture hearing such deposits
were consistent with drug dealing because drug deals frequently involve cash in
smaller denominations. Deputy Nies also indicated in his testimony there was a
substantial variance in the amounts of cash being deposited into the account, and
that such variances were not consistent with income earned from a legitimate job.
And “[t]he expertise of police officers in drug investigations may be considered
when determining if the State presented sufficient evidence.” In re Prop. Seized
from Thao, No. 14-1936, 2016 WL 1130280, at *8 (Iowa Ct. App. March 23, 2016).
Furthermore, the State presented evidence Jones admitted to selling “high
quality” marijuana to officers during the January 2020 search. He also told officers
they would find incriminating information related to marijuana distribution on the
various cellphones seized from his residence. Notably, he pled guilty to
possession of a controlled substance (marijuana) with intent to deliver following
the January 2020 search. Jones asserts there is no evidence he was distributing
marijuana prior to January 2020, but given these facts a fact-finder could
reasonably infer that he was engaged in marijuana trafficking prior to his residence
being searched.
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Based off this evidence, we believe substantial evidence supports the
district court’s finding the $36,635 in currency seized during the January 2020
search were the proceeds of marijuana trafficking. We note “[e]vidence is not
“insubstantial merely because we may draw different conclusions from it; the
ultimate question is whether it supports the finding actually made, not whether the
evidence would support a different finding.” Raper v. State, 688 N.W.2d 29, 36
(Iowa 2004).4
2. Currency Seized from November 2020 Search
As for the $51,614 in currency seized from Jones’s residence during the
November 2020 search, Jones argues a portion of this money was owned jointly
with Smith. And he claims “[t]here was no evidence that Smith had any
involvement in drug trafficking or any other type of illegal activity.” We reject this
argument.
4 In his brief, Jones asserts that not all the money in his bank account was the
proceeds of marijuana trafficking. He believes his case is analytically similar to In
re Prop. Seized from Boughton, a case in which we held that a seized Chrysler
was subject to forfeiture only to the extent criminal proceeds were used to fund its
purchase. No. 13-0327, 2014 WL 70300, at *3 (Iowa Ct. App. Jan. 9, 2014). When
property subject to forfeiture has been commingled with property not subject to
forfeiture, the commingled property and its fruits shall be forfeited “to the extent of
the property subject to forfeiture.” Iowa Code § 809A.12(13). Key to the court’s
reasoning in Boughton was the fact the State presented no evidence that
marijuana trafficking proceeds were used to purchase a Nissan, which was
subsequently sold to purchase the Chrysler. 2014 WL 70300, at *3. Thus, the
court believed the Chrysler was clearly paid for by some legitimate funds. Id. And
the court held the Chrysler was subject to forfeiture “to the extent that proceeds of
criminal conduct comprised the difference between the purchase price and the
$11,200 received from [the] sale of the Nissan.” Id. This case is distinguishable
because the State provided strong evidence the funds in Jones’s bank account
were the proceeds of illicit drug trafficking. Jones provided scant evidence that the
funds in his bank account were comprised of any legitimate funds.
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We note the evidence shows all the currency seized during the November
20 search came from Jones’s residence—where substantial amounts of marijuana
and items typically associated with drug distribution were found. The record does
not establish that Smith cohabited with Jones. And the Iowa Code creates a
presumption that money found near drugs or drug paraphernalia are the proceeds
of illicit activity. See Iowa Code § 809A.12(10) (stating “the fact that money . . .
was found in close proximity to any contraband or an instrumentality of conduct
giving rise to forfeiture” creates a presumption “that the money” was the proceeds
of conduct giving rise to forfeiture).
This large amount of currency was found in Jones’s residence at a time
when he was unemployed. Jones admitted to selling marijuana to officers and
pled guilty to possession of a controlled substance (marijuana) with intent to
deliver. Multiple cell phones were seized during the search. Deputy Neis testified
drug dealers often own multiple cell phones to conduct their trafficking business.
And while Jones claims he jointly owned some of the currency seized on
November 20 with Smith, she did not participate in the proceedings after filing an
initial answer. Jones’s testimony was the only evidence presented at the hearing
regarding Smith’s alleged co-ownership of the currency. But the district court
explicitly noted it did not find Jones’s testimony credible. See Hora v. Hora, 5
N.W.3d 635, 645 (Iowa 2024) (noting appellate courts should defer to witness
credibility determinations made by the district court, especially when such
determinations are outcome determinative). Thus, we find substantial evidence
supported the district court’s finding the $51,614 in currency was the proceeds of
Jones’s marijuana trafficking.
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B. Excessive Fine Clauses
Jones next argues that the forfeiture of over $85,000 in currency violates
the Excessive Fines Clauses of the state and federal constitutions. He claims the
gravity of the offenses he was convicted of following the searches of his residences
were not severe. He believes the forfeiture of his currency is grossly
disproportionate to the severity of his criminal activity. We decline to address the
merits on this argument because error on this issue was not preserved.5
Jones contends error was preserved because the district court stated, “that
the property forfeited is not grossly disproportionate to the severity of the case(s).”
In Jones’s view, this means the district court determined the forfeitures of the
currency did not violate the Excessive Fine Clauses of the state and federal
constitutions. We disagree.
Jones’s argument overlooks the fact that, earlier in its ruling, the district
court cited Iowa Code section 809A.12B. This statute states, “[p]roperty shall not
be forfeited as an instrumentality under this chapter to the extent that the amount
or value of the property is grossly disproportionate to the severity of the offense.”
Iowa Code § 809A.12B(1). Thus, when the district court stated “the property
forfeited is not grossly disproportionate to the severity of the case(s)” the court
5 Although the State conceded during oral argument that error was preserved on
this issue, we have a duty to independently assess error preservation. See Top of
Iowa Coop v. Sime Farms, Inc., 608 N.W.2d 454, 470 (“In view of the range of
interests protected by our error preservation rules, this court will consider on
appeal whether error was preserved despite the opposing party’s omission in not
raising this issue at trial or on appeal.”). We have this duty because we are “a
court for correction of errors at law.” See Iowa Code § 602.5103(1). “If an issue
was never presented to the district court to rule on, and if the district court did not
in fact rule on it, we lack any ‘error’ to correct.” State v. Gomez Medina, 7 N.W.3d
350, 355 (Iowa 2024).
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determined the forfeitures did not violate section 809.12B(1). Nowhere in the
district court’s ruling is the Excessive Fines Clause of either the state or federal
constitution mentioned. And there would have been no reason for them to have
been because Jones never raised this issue.
Because the issue of whether the forfeitures violated the excessive fine
clauses of the state and federal constitutions was not raised, error was not
preserved. See In re Det. of Anderson, 895 N.W.2d 131, 138 (Iowa 2017) (“In order
for error to be preserved, the issue must be both raised and decided by the district
court.”).
C. Subject Matter Jurisdiction
Jones’s final argument is that the district court lacked subject matter
jurisdiction to hear the forfeiture action stemming from the January 2020 search.
Jones argues that because some of the items seized from his home occurred on
January 18 (not including the funds in his bank account which were seized on
January 24), the State was required to “[f]ile a notice of pending forfeiture against
the property within ninety days after seizure.” Iowa Code § 809A.8(1)(a)(1). Thus,
Jones contends the State was required to file notice of pending forfeiture for all
items by April 18, 2020. And because notice of pending forfeiture was not filed by
the State until April 21, 2020, subject matter jurisdiction is lacking as the notice
was untimely.
Again, we decline to address the merits on this argument because Jones
waived the argument by not raising it in the district court. Jones conflates subject
matter jurisdiction and a court’s authority to hear a case. “Subject matter
jurisdiction refers to the power of a court ‘to hear and determine cases of the
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general class to which the proceedings in question belong, not merely the
particular case then occupying the court’s attention.’” State v. Mandicino, 509
N.W.2d 481, 482 (Iowa 1993) (citation omitted).
A court may have subject matter jurisdiction yet lack authority to hear a
case. “In such a situation we say the court lacks authority to hear that particular
case.” See id. (citation omitted). This distinction is crucial because challenges to
subject matter jurisdiction may be brought at any time while challenges to a court’s
authority may be waived. See id. at 483.
The Iowa Code clearly confers subject matter jurisdiction over forfeiture
actions to the district courts. See Iowa Code § 809A.2(1)(a). And our supreme
court has characterized notice challenges under section 809A.8(1)(a)(1) as
challenges to a district court’s authority. See In re Prop. Seized for Forfeiture from
Williams, 676 N.W.2d 607, 613 (Iowa 2004) (finding “the district court did not have
authority to hear the second forfeiture action” because the notice requirements of
section 809A.8(1)(a)(1) were not met (emphasis added)). Therefore, we find
Jones’s subject matter jurisdiction challenge is really a challenge to the district
court’s authority.
Because Jones never raised a challenge to the district court’s authority, we
find this challenge has been waived. See State v. Emery, 636 N.W.2d 116, 123
(Iowa 2001) (“Any deficiency in the district court’s authority was waived when the
defendant failed to object to the district court’s adjudication of his case.”).
IV. Conclusion
In sum, we affirm the district court’s ruling, finding (1) substantial evidence
supported the district court’s finding the currency seized during the two searches
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of Jones’s residence were the proceeds of illicit drug trafficking; (2) Jones did not
preserve error on his arguments that the forfeitures violated the excessive fine
clauses of the state and federal constitutions; and (3) his challenge to the district
court’s authority was waived.
AFFIRMED.