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United States v. $64

United States District Court, E.D. Kentucky, Central Division, Lexington

October 27, 2014

$64, 495.00 IN UNITED STATES CURRENCY, Defendant.


ROBERT E. WIER, Magistrate Judge.

The Court considers Plaintiff's motion for summary judgment. DE #23 (Motion). Claimant, Martha Alday-Montanez, responded in opposition (DE #26), and Plaintiff replied. DE #27 (Reply). For the reasons stated herein, the Court DENIES Plaintiff's motion (DE #23). The Government has failed to justify summary judgment under the applicable Rule 56 standards.

I. Relevant Factual and Procedural Background

On August 21, 2013, the United States filed a verified complaint in rem to obtain forfeiture of $64, 495.00 pursuant to 21 U.S.C. § 881(a)(6). DE #1 (Complaint). The complaint, supported by an affidavit from DEA TFO Matthew J. Dawkins, alleges that the currency "was furnished or intended to be furnished in exchange for controlled substances, was proceeds traceable to such an exchange, or was intended to be used to facilitate the illegal sale of narcotics." Id. at 2 ¶ 6. Specifically, the United States alleges that the money was used by Luis M. Enriquez to facilitate marijuana trafficking or was proceeds of same. The Clerk issued the warrant of arrest in rem (DE #3), which the United States Marshals Service executed on September 9, 2013. DE #4 (Warrant Return). Alday-Montanez, by counsel, answered the Complaint on October 28, 2013, tendering also a verified claim. DE #5 (Answer); DE #6 (Verified Claim). Following a discovery period, the Government filed the instant motion.

Per TFO Dawkins's affidavit, [1] the investigation began when a confidential informant with the Lexington Police Department told Detective Curtsinger that he (the CI) had been to Enriquez's farm and that Enriquez stored marijuana in his barn. DE #1-4 (Dawkins Aff.) at 5 ¶ 9. Later, in December 2012, the CI told Versailles Police Officer Costigan that he (the CI) was present at Enriquez's home when a third-party purchased a 10-pound block of marijuana from "Luis." Id. ¶ 10. Police surveilled the residence, though they eventually terminated surveillance because of Enriquez's alleged sensitivity to surveillance efforts. Id. ¶ 11.

Per the affidavit, on March 24, 2013, law enforcement in Longview Texas received reports of an abandoned white Ford pick-up truck parked on the street. By the time police officer Jason Hampton responded, the vehicle had been parked there for several hours. Hampton smelled marijuana upon approaching the vehicle. A probable cause search of the truck revealed approximately 20 pounds of marijuana in a black plastic bag behind the driver's seat; officers recovered an additional 66 pounds from a plastic container in the truck bed. All marijuana presented in 1-pound blocks. Id. ¶ 12. The truck was registered to Luis Enriquez, P.O. Box 3813, Midway, Kentucky, 40347, bore license plate number 350 LGS, and was the same vehicle Kentucky officers observed at Enriquez's Midway residence during surveillance. Id. ¶ 13.

Based on the totality of the investigation, officers from the Versailles Police Department obtained and executed a state search warrant at 524 W. Leestown Road, the residence of Luis Enriquez and Martha Patricia Alday-Montanez, on March 26, 2013. Id. ¶ 7. As a result of the search, agents seized $64, 495 in United States currency, [2] 6 handguns, 10 rifles, and approximately 12.4 grams of marijuana.[3] Id. Officers arrested Enriquez and charged him with violations of state law. Id. Officers also recovered an empty box for a digital scale and an empty box for gallon-sized plastic bags in a "burn pile" behind a shed behind the residence. Id. ¶ 8. Within the shed, agents found "a cutting device with a spool of plastic stretch wrap, " which TFO Dawkins associated with packaging large quantities of marijuana. A search of the kitchen area and carport revealed ledgers with names and suspected drug weights. Id.

During an interview with law enforcement, Enriquez allegedly advised officers that the money came from accounts that United Bank had closed due to Enriquez's undocumented status. Id. ¶ 15. He further indicated that, in light of his immigration status, he was unable to open an account at a different financial institution. Id.

Federal authorities eventually charged Enriquez with a violation of 18 U.S.C. § 922(g)(5)(A), or possession of a firearm by an illegal alien. Enriquez ultimately pled guilty to the charge, and Chief Judge Caldwell sentenced him to 24 months of imprisonment. Enriquez also forfeited his interest in a number of identified firearms and ammunition. See generally United States of America v. Luis Manuel Enriquez, 5:13-CR-76-KKC-REW (E.D. Ky.). Neither state nor federal authorities convicted Enriquez of a controlled substance violation relative to the instant investigation.

This civil forfeiture action targets the monies seized during the March 26, 2013 warranted residential search. Plaintiff now seeks summary judgment, and the motion is ripe for review.

I. Standard of Review

A federal civil in rem forfeiture action draws from several procedural sources. The claim origin is statutory (in this case, 21 U.S.C. § 881(a)(6)) and CAFRA, 18 U.S.C. § 983). The particular framework of the amended Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions governs specific pleading and claim mechanics. However, the federal rules generally continue to apply except where inconsistent with the Supplemental Rules. See United States v. $50, 800.00 in U.S. Currency, No. CV-10-2004-PHX, 2011 WL 2434225, at *1 (D. Ariz. June 16, 2011) ("Federal civil in rem forfeitures are governed by the Federal Rules of Civil Procedure."); see also Supplemental Rule G(1) (incorporating and assuring that "Federal Rules of Civil Procedure also apply" to forfeiture actions in rem except to extent the Supplemental Rules "address an issue."); United States v. $8.221, 877.16 in U.S. Currency, 330 F.3d 141, 159-50 (3d Cir. 2003) ("The Civil Rules therefore also apply to in rem proceedings, but only to the extent that they are not inconsistent with' the Supplemental Rules[.]"). Thus, the summary judgment mechanics of Rule 56 apply to (and in conformity with) the specific substantive steps of a CAFRA action. See, e.g., United States v. 939 Salem St., Lynnfield, Mass., 917 F.Supp.2d 151, 154-55 (D. Mass. 2013) ("Summary judgment may be entered in an in rem civil forfeiture action where the moving party satisfies the familiar Rule 56 standard.").

Pursuant to Federal Rule of Civil Procedure 56, a court shall grant summary judgment "if the movant shows that 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(a). A reviewing court must construe the evidence and draw all reasonable inferences from the underlying facts in favor of the nonmoving party. Matsushita Elec. Indus. Co. Ltd. v. Zenith Radio Corp., 106 S.Ct. 1348, 1356 (1986); Lindsay v. Yates, 578 F.3d 407, 414 (6th Cir. 2009). Additionally, the court may not "weigh the evidence and determine the truth of the matter" at the summary judgment stage. Anderson v. Liberty Lobby, Inc., 106 S.Ct. 2505, 2511 (1986).

The burden of establishing the absence of a genuine dispute of material fact initially rests with the moving party. Celotex Corp. v. Catrett, 106 S.Ct. 2548, 2553 (1986) (requiring the moving party to set forth "the basis for its motion, and identify[] those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, ' which it believes demonstrate an absence of a genuine issue of material fact"); Lindsay, 578 at 414 ("The party moving for summary judgment bears the initial burden of showing that there is no material issue in dispute."). If the moving party meets its burden, the burden then shifts to the nonmoving party to produce "specific facts" showing a "genuine issue" for trial. Celotex Corp., 106. S.Ct. at 2253; Bass v. Robinson, 167 F.3d 1041, 1044 (6th Cir. 1999). The Rule "mandates the entry of summary judgment... against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. at 106 S.Ct. at 2552. If the movant bears the burden of persuasion at trial, "that party must support its motion with credible evidence-using any of the materials specified in Rule 56(c)-that would entitle it to a directed verdict if not controverted at trial." Id. at 2556 (citation omitted) (Brennan, J., dissenting); see also Arnett v. Myers, 281 F.3d 552, 561 (6th Cir. 2002) (noting that, when the movant also bears the burden of persuasion at trial, the moving party's initial summary judgment burden is "higher in that it must show that the record contains evidence satisfying the burden of persuasion and that the evidence is so powerful that no reasonable jury would be free to disbelieve it") (citation and internal quotation marks omitted).

A fact is "material" if the underlying substantive law identifies that fact, or the element it concerns, as critical. Anderson, 106 S.Ct. at 2510. Thus, "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Id. A "genuine" issue exists if "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Id. at 2511; Matsushita Elec. Indus. Co., 106 S.Ct. at 1356 ("Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial.'") (citation omitted). Such evidence must be suitable for admission into evidence at ...

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