United States v. $189,825.00

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This order and judgment is not binding precedent, except under the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.
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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.
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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
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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
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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
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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
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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...)
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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.
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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).
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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).
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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
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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.
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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.
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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...)
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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.
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