United States v. $525,695.24 , 869 F.3d 412 ( 2017 )

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 17a0192p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
UNITED STATES OF AMERICA, ┐
Plaintiff-Appellee, │
│
│
v. > No. 16-3209
│
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$525,695.24, SEIZED FROM JPMORGAN CHASE BANK │
INVESTMENT ACCOUNT #74068415, et al., │
Defendants, │
│
SBEIH A. SBEIH, │
│
Claimant-Appellant.
│
┘
Appeal from the United States District Court
for the Northern District of Ohio at Cleveland.
No. 1:13-cv-01455—Donald C. Nugent, District Judge.
Argued: March 7, 2017
Decided and Filed: August 23, 2017
Before: CLAY, GIBBONS, and STRANCH, Circuit Judges.
_________________
COUNSEL
ARGUED: Joan E. Pettinelli, North Royalton, Ohio, for Appellant. Phillip J. Tripi, UNITED
STATES ATTORNEY’S OFFICE, Cleveland, Ohio, for Appellee. ON BRIEF: Joan E.
Pettinelli, North Royalton, Ohio, for Appellant. Phillip J. Tripi, UNITED STATES
ATTORNEY’S OFFICE, Cleveland, Ohio, for Appellee.
No. 16-3209 United States v. $525,695.24, et al. Page 2
_________________
OPINION
_________________
CLAY, Circuit Judge. The United States filed a civil forfeiture complaint against
numerous bank accounts, as well as three cars and various real properties, asserting that the
named properties were either used in the transportation and sale of controlled substances, were
used or intended to be used to facilitate drug trafficking, or were involved in money laundering.
The government thus asserted that the properties were subject to forfeiture pursuant to 21 U.S.C.
§ 881(a)(4), (a)(6), and (a)(7), as well as 18 U.S.C. § 981. Claimant Sbeih Sbeih filed a verified
claim to seven of the bank accounts; however, the government moved to strike that claim based
on the fugitive disentitlement statute, 28 U.S.C. § 2466. The district court granted the
government’s motion to strike Sbeih’s claim and subsequently ordered the accounts forfeited.
Sbeih now appeals the order of forfeiture and the decision by the district court striking his claim.
For the reasons set forth below, we VACATE the district court’s judgment and REMAND the
action for further proceedings consistent with this opinion.
BACKGROUND
On June 3, 2013, the government filed a civil in rem forfeiture complaint against twenty
bank accounts, two real properties, three vehicles, and $91,500 in United States currency. This
civil forfeiture action is related to the government’s investigation of Sbeih and Osama Salouha, a
claimant in a related case. Salouha is alleged to have illegally sold prescription drugs, including
oxycodone, oxymorphone, and hydrocodone, through the two pharmacies he owns in Ohio, in
violation of 21 U.S.C. § 841. Sbeih was a joint owner in one of Salouha’s pharmacies, and
together Sbeih and Salouha are alleged to have laundered the receipts from Salouha’s illegal drug
sales through their personal and business accounts, in violation of 18 U.S.C. § 1956.
The government sought forfeiture pursuant to 21 U.S.C. § 881(a)(4), (a)(6), and (a)(7), as well as
18 U.S.C. § 981, as the bank accounts contained proceeds from drug trafficking activities, were
used to facilitate drug trafficking, or were involved in money laundering.
No. 16-3209 United States v. $525,695.24, et al. Page 3
On August 7, 2013, Sbeih and his wife, Nimeh Ahmad-Sbeih, filed verified claims to
seven of the personal bank accounts held in one or both of their names. The case was then
stayed for a year because of the related criminal investigation. Sbeih was indicted on June 3,
2014, on one count of conspiracy to commit money laundering, one count of conspiracy to
defraud the Internal Revenue Service, and three counts of making and subscribing false income
tax returns. When Sbeih failed to appear for his arraignment on his criminal charges, the district
court issued a warrant for his arrest.
Meanwhile, the district court lifted the stay on the civil forfeiture case and scheduled a
status conference for June 24, 2014. Sbeih’s counsel sought the district court’s permission for
Sbeih not to attend the conference in person, as he was in Israel. Sbeih alleged that he was in
danger of losing his Jerusalem permanent residency permit if he left Israel. The district court
granted the motion, excusing Sbeih.
On September 18, 2014, the government filed a motion to strike Sbeih’s claim pursuant
to the fugitive disentitlement statute. Sbeih opposed that motion. The district court did not
immediately rule on the issue and instead waited to see whether the Salouhas, Sbeih’s co-
defendants in the criminal case, were able to reenter the country, as they were reportedly stuck in
Gaza. On April 10, 2015, the government refiled its motion to strike Sbeih’s claims pursuant to
the fugitive disentitlement statute. After receiving a response from Sbeih, the district court
granted the government’s motion to strike Sbeih’s claim on May 12, 2015. On January 14, 2016,
the district court entered judgment against the relevant defendant properties, ordering them
forfeited to the United States. This timely appeal followed.1
DISCUSSION
On appeal, Sbeih challenges the district court’s determination that he should be prevented
from pursuing his interest in the defendant properties based on his status as a fugitive.
We conclude that the district court clearly erred in finding that, based on the record as preserved
1
The notice of appeal was timely because it was filed within 60 days of the district court’s order ordering
forfeiture of the defendant properties, as one of the parties was the United States. See Fed. R. App. P. 4(a)(1)(B)(i).
No. 16-3209 United States v. $525,695.24, et al. Page 4
for appeal, Sbeih should be disentitled because he was evading criminal prosecution by not
returning to the United States.
A. Jurisdiction
The district court had jurisdiction over this action pursuant to 28 U.S.C. § 1345, which
provides that “district courts shall have original jurisdiction of all civil actions, suits or
proceedings commenced by the United States.” The district court also had jurisdiction pursuant
to 28 U.S.C. § 1355, as this is an action for forfeiture. This Court has jurisdiction to hear the
appeal pursuant to 28 U.S.C. § 1291.
B. Standard of Review
This Court reviews de novo whether 28 U.S.C. § 2466 is applicable to Sbeih’s case, and
“to the extent we conclude that the statute is applicable . . . , we review the district court’s
decision to order disentitlement for abuse of discretion.” United States v. Salti, 579 F.3d 656,
662–63 (6th Cir. 2009) (alteration in original) (quoting Collazos v. United States, 368 F.3d 190,
195 (2d Cir. 2004)). We review the district court’s factual findings, including the finding as to
intent, for clear error. United States v. Batato, 833 F.3d 413, 431 (4th Cir. 2016) (citation
omitted).
C. Analysis
The fugitive disentitlement statute, codified as 28 U.S.C. § 2466, states:
(a) A judicial officer may disallow a person from using the resources of the courts
of the United States in furtherance of a claim in any related civil forfeiture action
or a claim in third party proceedings in any related criminal forfeiture action upon
a finding that such person—
(1) after notice or knowledge of the fact that a warrant or process has been
issued for his apprehension, in order to avoid criminal prosecution—
(A) purposely leaves the jurisdiction of the United States;
(B) declines to enter or reenter the United States to submit to its
jurisdiction; or
(C) otherwise evades the jurisdiction of the court in which a criminal case
is pending against the person; and
No. 16-3209 United States v. $525,695.24, et al. Page 5
(2) is not confined or held in custody in any other jurisdiction for commission
of criminal conduct in that jurisdiction.
Based on the text of this statute, this Court has adopted the following five part test to determine
whether disentitlement is appropriate:
(1) a warrant or similar process must have been issued in a criminal case for the
claimant’s apprehension; (2) the claimant must have had notice or knowledge of
the warrant; (3) the criminal case must be related to the forfeiture action; (4) the
claimant must not be confined or otherwise held in custody in another
jurisdiction; and (5) the claimant must have deliberately avoided prosecution by
(A) purposefully leaving the United States, (B) declining to enter or reenter the
United States, or (C) otherwise evading the jurisdiction of a court in the United
States in which a criminal case is pending against the claimant.
Salti, 579 F.3d at 663 (quoting Collazos, 368 F.3d at 198).
In this case, Sbeih only challenged the applicability of the fifth factor—whether he
deliberately avoided prosecution by declining to reenter the United States. Sbeih argued that he
is remaining in Israel not because he is trying to evade criminal prosecution, but because, if he
leaves, he is unlikely to be able to retain his permanent resident status in Jerusalem. In support
of his contention that he would not be allowed to retain his permanent residency status in Israel if
he left, Sbeih included an affidavit from his lawyer in Israel, as well as an expert report from a
professor who reviewed Sbeih’s records from his Israeli court proceedings.
Applying the test set forth in Salti, the district court found that disentitlement was
appropriate and granted the government’s motion to strike Sbeih’s claim to seven of the bank
accounts listed in the forfeiture complaint. The district court first determined that the
government did not need to prove that Sbeih’s sole reason for staying outside the United States
was to evade criminal prosecution. While Sbeih proffered another reason for staying in Israel—
his fear of losing permanent resident status in Israel if he left the country—the district court
determined that such fear “does not preclude a finding that [Sbeih] has made a conscious choice
not to reenter the United States in order to avoid criminal prosecution.” (R. 145, Mem. Op.
& Order, PageID #1309.)
No. 16-3209 United States v. $525,695.24, et al. Page 6
The district court then offered the following as its rationale for determining that the fifth
factor was satisfied:
Based on the totality of the circumstances, as related by Counsel during
the numerous Status Conferences held in this case and briefed repeatedly by the
Parties, the Court finds that Mr. Sbeih has made a conscious choice not to reenter
the United States for the purpose of avoiding prosecution. Mr. Sbeih is not
prohibited from leaving Israel; is not detained in Israel; and, has presented no
evidence that he is somehow incapacitated or otherwise unable to travel. Mr.
Sbeih’s wife has returned to the United States and, although Mr. Sbeih argues he
must stay in Jerusalem to care for his parents, Mr. Sbeih has indicated he has
siblings who remain in Jerusalem. Prior to 2008, Mr. Sbeih traveled to Jerusalem
only every two or three years and, in 2011, during the pendency of legal
proceedings regarding his residency, Mr. Sbeih did in fact seek (through his
attorney) and receive (from the Ministry of the Interior with the assistance of the
United States Consulate) permission to travel to the United States for four
months. However, he now chooses not to return to the United States in the face of
the pending criminal case. Mr. Sbeih shall not [be] permitted to pursue a claim in
this civil forfeiture action, while at the same time purposefully avoiding the
criminal case pending against him.
(Id. at 1310 (internal citation omitted).) Sbeih now raises two relevant challenges to the district
court’s analysis on appeal. First, Sbeih argues that the district court incorrectly concluded that
evading criminal prosecution did not have to be the sole purpose of remaining outside the United
States. Second, Sbeih argues that the district court erred in concluding that the government had
met its burden of showing that he stayed outside of the United States to avoid criminal
prosecution.2 Each of these arguments is addressed in turn below.
1. Whether evading prosecution must be the sole reason for remaining
outside the United States
Sbeih argues that the language of the fugitive disentitlement statute requires that the
government prove that evading criminal prosecution is “at least the principal or dominant, if not
the sole, reason for [his] decision to remain in Jerusalem.” (Claimant’s Br. at 25.) According to
2
Because we have determined that the district court clearly erred in finding that Sbeih was remaining in
Israel to avoid prosecution in the United States given the record before us, we need not reach Sbeih’s additional
argument that the district court abused its discretion in ordering forfeiture by not conducting a separate analysis to
determine whether disentitlement was appropriate in light of the court’s discretionary authority. We also need not
consider Sbeih’s argument that application of the fugitive disentitlement statute violates his Fifth Amendment due
process rights.
No. 16-3209 United States v. $525,695.24, et al. Page 7
Sbeih, the language in § 2466 stating that disentitlement is appropriate when a claimant refuses
to reenter the United States “in order to avoid criminal prosecution” dictates that “the
government must prove that avoiding prosecution was the reason the claimant has failed to
return.” (Id. at 27 (quoting 28 U.S.C. § 2466(a)(1)).) Sbeih further argues that “the potential
existence of ‘another reason’ for failure to reenter is enough to reverse the application of the
statute.” (Id.) He also points to our decision in Salti, in which, according to his interpretation,
we determined that “the existence of a legitimate reason for failure to return, such as the
claimant’s ill health, may preclude a finding . . . that the failure to reenter is ‘in order to avoid
prosecution.’” (Id. at 26 (citing Salti, 579 F.3d at 665).)
As an initial matter, we do not read Salti as requiring the government to prove that Sbeih
had only one motive—avoiding prosecution—for staying in Israel. Salti involved a case where
the claimant produced evidence that he was unable to travel from Jordan to the United States
because of his poor health and recent open heart surgery. 579 F.3d at 665. The district court,
however, only considered the claimant’s health when deciding whether, in its discretion,
disentitlement was appropriate. Id. Notably, the district court considered the claimant’s poor
health irrelevant to the question of whether he was “deliberately avoid[ing] prosecution by . . .
declining to enter or reenter the United States.” Id. (alterations in original) (quoting Collazos,
368 F.3d at 198). The Salti Court determined that the district court committed error by failing to
consider the claimant’s health because if the claimant was “indeed too sick to travel, such that
his illness is what prevent[ed] him from returning to the United States, the Government has not
shown as a matter of law that [the claimant’s] being in Jordan, and not in the United States, is ‘in
order to avoid criminal prosecution.’” Id. at 665–66 (quoting 28 U.S.C. § 2466(a)(1)). In
reaching that conclusion, the Salti Court relied on Collazos, in which the Second Circuit found
that “disentitlement was appropriate when the individual in question ‘made a conscious choice
not to enter or reenter the United States to face the criminal charges pending against her,’ and
when ‘nothing in the record indicate[d] that [the claimant] was ever confined, incarcerated, or
otherwise unable to travel to the United States.” Id. at 666 (emphasis in original) (quoting
Collazos, 368 F.3d at 201).
No. 16-3209 United States v. $525,695.24, et al. Page 8
The Salti Court did not consider whether any legitimate reason for staying outside the
United States would defeat the fugitive disentitlement statute’s requirement that failure to reenter
the United States must be “in order to avoid criminal prosecution.” 28 U.S.C. § 2466(a)(1).
Instead, Salti addressed the situation where the government had not proven that the claimant was
able to return to the United States in the first place but made the conscious choice not to return so
that he could evade prosecution. The Court never stated that disentitlement was wrongly applied
to the claimant because of his illness or that evidence of his illness was enough for the claimant
to establish that he was not evading criminal prosecution by staying in Jordan. The Salti Court
instead remanded the case for further factual development. Thus, Salti did not decide the
question of whether the government must prove that Sbeih’s principal or sole purpose in staying
in Jerusalem was to evade prosecution.
Sbeih further contends that the D.C. Circuit, in United States v. $6,976,934.65, Plus
Interest Deposited into Royal Bank of Scotland International, Account Number 2029-56141070,
Held in the Name of Soulbury Ltd., 554 F.3d 123 (D.C. Cir. 2009), adopted a test whereby the
government must prove that evading prosecution is the sole reason for the claimant’s refusal to
return to the United States. The D.C. Circuit’s opinion also does not address the question
presented here. Contrary to Sbeih’s argument, the court in that case faced a situation where the
government failed to prove that the claimant’s purpose in remaining outside the United States
was to avoid prosecution. The government pointed to a television appearance of the claimant in
which he acknowledged that “he would likely be arrested if he returned to the United States.” Id.
at 132. The court determined, however, that “the video also suggest[ed] that [the claimant] did
not wish to reenter the United States regardless of any pending criminal charges.” Id.Specifically, the court noted that “[t]he district court made no finding as to what, if anything, this
comment reveals about [the claimant’s] reasons for remaining outside the United States.” Id.Given that the court was deciding the motion using a summary judgment standard, the court
determined that the claimant’s statement was “sufficient to raise a genuine issue of fact whether
he declined to reenter the country in order to avoid criminal prosecution.” Id.As explained by the Fourth Circuit, the D.C. Circuit decided that the claimant’s statement
made on television “was insufficient to show conclusively that avoiding prosecution was even a
No. 16-3209 United States v. $525,695.24, et al. Page 9
reason that the claimant remained outside the United States, and neither the district court nor the
government had actually attempted to show intent, believing the requirement was met by
showing mere ‘notice or knowledge.’” Batato, 833 F.3d at 431 (citing $6,976,934.65, 554 F.3d
at 132). The D.C. Circuit did not determine that the government must also establish that the
claimant had the sole intent of avoiding prosecution. Thus, while the D.C. Circuit’s opinion is
instructive for determining the standard of proof the government must provide of the claimant’s
intent, it does not address whether a claimant can have multiple motives in remaining outside the
United States, one of which is to evade prosecution, and still be subject to disentitlement.
We further note that three other circuit courts have determined that the government does
not need to prove that the claimant had the principal or sole motive of avoiding prosecution for
the disentitlement statute to apply. In United States v. $671,160.00 in U.S. Currency, 730 F.3d
1051 (9th Cir. 2013), the Ninth Circuit addressed a case where a claimant, who was not a citizen
of the United States, argued that he “remain[ed] in Canada not to ‘evade the [state] court’s
jurisdiction’ but insist[ed] that he ‘merely returned to his home.’” Id. at 1056 (second alteration
in original). The court, however, noted:
The existence of other factors that might have also motivated [the claimant] to
remain abroad, such as his Canadian citizenship and residency, does not
undermine or foreclose the district court’s finding that [the claimant] made a
conscious choice to not “enter or reenter the United States” in order to avoid
criminal prosecution. 28 U.S.C. § 2466(a)(1)(B). [The claimant’s] desire to evade
criminal prosecution need not be the sole motivating factor causing him to remain
abroad, to the exclusion of all others. All that is required is a finding that “after
notice or knowledge of the fact that a warrant or process has been issued for his
apprehension, in order to avoid criminal prosecution,” [the claimant] “declines to
enter or reenter the United States to submit to its jurisdiction.” Id. There is
sufficient evidence here to support that determination.
$671,160.00 in U.S. Currency, 730 F.3d at 1056 n.2.
The Second Circuit similarly held “that the government was required to prove that the
[claimants] remained outside of the United States with the specific intent to avoid criminal
prosecution.” United States v. Technodyne LLC, 753 F.3d 368, 383 (2d Cir. 2014) (citation
omitted). The court, however, rejected the claimants’ “attempts to equate specific intent with
sole, principal, or dominant intent.” Id. The court went on to state that “[i]t is commonplace that
No. 16-3209 United States v. $525,695.24, et al. Page 10
the law recognizes that there may be multiple motives for human behavior; thus, a specific intent
need not be the actor’s sole, or even primary, purpose.” Id. at 385. The court further noted that
other crimes, such as bribery, tax evasion, and conspiracy, generally require a specific intent, but
that “a defendant accused of such a crime may properly be convicted if his intent to commit the
crime was any of his objectives.” Id. (citations omitted). The court also opined that, had
Congress intended to require that the claimant’s sole purpose in remaining outside the United
States was to avoid prosecution, it would have stated so expressly. Id. However, the fugitive
disentitlement statute does not contain such limiting language. Id. Finally, the court stated:
As Congress sought to bar the “unseemly spectacle” of allowing an accused to
absent himself deliberately in order to avoid prosecution in the United States
while using United States courts to retrieve the proceeds of his crime, it would
defy logic to infer that Congress sub silentio intended to allow the fugitive to
create such an abomination by the simple expedient of claiming some additional
reason for not returning.
Id. at 385–86 (internal citation omitted).
Most recently, the Fourth Circuit held in United States v. Batato that § 2466 has a
specific intent requirement, but that it does not mandate that avoiding prosecution be the sole
reason for a claimant’s refusal to return to the United States. 833 F.3d at 429–31. The court
noted that the text of the statute does not include any limiting language that would indicate that
“Congress wanted to make § 2466 apply only where avoiding prosecution was the ‘sole’ or
‘principal’ reason for a person’s absence from the United States.” Id. at 430. The court also
opined that “Congress clearly anticipated § 2466 would apply to individuals with no reason to
come to the United States other than to defend against criminal charges.” Id. With regard to
those people, the court further stated:
Because the statute must apply to people with no reason to come to the United
States other than to face charges, a “sole” or “principal” purpose test cannot stand.
The principal reason such a person remains outside the United States will
typically be that they live elsewhere. A criminal indictment gives such a person a
reason to make the journey, and the statute is aimed at those who resist
nevertheless.
Id.
No. 16-3209 United States v. $525,695.24, et al. Page 11
We join the Second, Fourth, and Ninth Circuits in holding that, while § 2466 requires the
government to prove that the claimants had a specific intent of avoiding criminal prosecution in
deciding to remain outside the United States, the statute does not require that that intent be the
sole or principal intent. As the other three circuits have noted, the text of the statute does not
imply such a requirement. Furthermore, Congress was certainly able to impose a more stringent
intent requirement and knew how to do so, but chose not to in this instance. Congress also
intended for foreign nationals to be subject to § 2466, as it included both failing to enter and to
reenter as ways of avoiding criminal prosecution. 28 U.S.C. § 2466(a)(1)(B). Therefore,
Congress contemplated that non-citizens who had not been to the United States but who
nevertheless failed to come to the country after a criminal indictment would be subject to
disentitlement. These individuals likely have many reasons for not coming to the United States,
only one of which may be to avoid criminal prosecution. However, Congress still explicitly
included them in the reach of § 2466.
Moreover, courts in the United States have repeatedly recognized that individuals can
have multiple goals when committing various crimes; as long as one of those objectives was
actually to commit the crime, the mens rea element is satisfied. See Technodyne LLC, 753 F.3d
at 385 (collecting cases). We agree that the same principle applies here—as long as one of the
goals in not coming to the United States is to evade prosecution, the specific intent requirement
of § 2466 is satisfied. We therefore hold that § 2466 does not provide that disentitlement is
proper only when a claimant has the sole or principal purpose of evading prosecution in not
returning to the United States. Instead, disentitlement under § 2466 is appropriate whenever a
claimant fails to enter or reenter the United States with the intention of avoiding prosecution,
regardless of any additional purposes the claimant may have for remaining outside the United
States.
2. Whether the district court erred in concluding that the government
met its burden of showing that Sbeih stayed outside of the United
States to avoid criminal prosecution
Sbeih next argues that the district court erred in granting the government’s motion to
strike his claim because the government did not meet its burden of showing that Sbeih had the
intent of avoiding prosecution at all. Sbeih contends that the government relied only on the fact
No. 16-3209 United States v. $525,695.24, et al. Page 12
that he had notice of the criminal prosecution but failed to return to the United States. Sbeih
therefore argues that the district court improperly shifted the burden onto him to prove that he
was not trying to avoid prosecution, when the available evidence showed that he “intended to
remain in Jerusalem unless and until he was able to travel without jeopardizing his Israeli
permanent residency, regardless of the indictment.” (Claimant’s Br. at 32.)
The government, on appeal, argues only that Sbeih’s plea negotiations support the
contention that Sbeih was remaining in Israel to avoid prosecution. The government points to
one section in its original motion to strike Sbeih’s claim, which stated:
[T]he criminal AUSAs assigned to the case were in regular contact with counsel
for Sbeih, culminating in a meeting on April 29, 2014, at which the potential of a
resolution of the case by plea agreement was discussed. It was clearly
communicated to claimant’s counsel that any resolution of the case would need to
include a criminal conviction and that an indictment was forthcoming.
(Gov’t Br. at 22 (alterations in original) (quoting R. 85, Gov’t’s Mot. to Strike Claims, PageID
#644).) The government further stated, “[b]ased upon discussions with his former retained
criminal defense counsel, it is inconsistent for Sbeih to suggest in his Appellate Brief that his
exposure to potential criminal sanctions was not a concern to him in choosing to remain in
Israel.” (Id.) The government then opines that, from the plea negotiations and “from
representations made by the parties during the status conferences the district court conducted, . . .
the district court had a basis to infer that Sbeih’s motive for not returning to the United States
was, in part, due to the related criminal case.” (Id.)
Importantly, the conversations on which the government relies are not available for us to
review, as almost all status conferences held by the district court were conducted off the record.
Thus, to the extent that the government and the district court reached an understanding about
Sbeih’s motives during these conferences, such determinations cannot be credited on appellate
review. Moreover, we are left unable to determine whether and to what extent Sbeih refuted the
government’s allegations about the reasons behind his failure to return to the United States.
We find that the record in this case is insufficient to allow us to conclude that the
government met its burden of proving that Sbeih was not returning to the United States in order
to avoid prosecution. See Salti, 579 F.3d at 665–66 (holding that “the Government has not
No. 16-3209 United States v. $525,695.24, et al. Page 13
shown as a matter of law that [the claimant’s] being in Jordan, and not in the United States, is ‘in
order to avoid criminal prosecution.’” (citation omitted)); see also Technodyne LLC, 753 F.3d at
381 (holding that “where the government moves for disentitlement of a claimant, it bears the
burden of establishing the factual prerequisites laid out in that statute”). We agree that the
government cannot satisfy its burden by relying solely on the fact that Sbeih had notice of the
warrant but failed to return to the United States. Such a low burden reads out the specific intent
requirement, incorporated in both the statute and the five factor test, that the claimant
“deliberately avoided prosecution.” Salti, 579 F.3d at 663 (emphasis added). While the district
court may consider notice and the failure to return as part of the “totality of the circumstances”
that would indicate a specific intent to evade prosecution, notice and a failure to return cannot
carry the entirety of the government’s burden. See $6,976,934.65, 554 F.3d at 132 (holding that
“mere notice or knowledge of an outstanding warrant, coupled with a refusal to enter the United
States, does not satisfy the statute”).
After a thorough review of the record in this case, we can find nothing, beyond the mere
fact that Sbeih had notice of the criminal proceeding but failed to return, that would support the
district court’s finding that Sbeih was deliberately remaining in Israel to avoid prosecution.
Unlike in the Ninth Circuit’s case, there is no significant pattern of travel between Israel and the
United States that abruptly stopped after the criminal indictment. See $671,160.00 in U.S.
Currency, 730 F.3d 1057 (noting that the claimant’s “self-enforced absence from the United
States stands in marked contrast to his extensive travel to California prior to the issuance of the
pending criminal charge”). While the government contends that Sbeih is able to return to the
United States because he had done so previously, the government has not put forth any evidence
to contradict Sbeih’s statement that he moved to Israel in 2008 and has only returned once in
2011 with the explicit permission of the Israeli Ministry of the Interior. Moreover, the record
does not contain numerous inconsistent statements that would indicate that Sbeih was being
misleading, thus entitling the district court to discount his statements. See Technodyne LLC,
753 F.3d at 386–87. While the government has asserted that plea negotiations were discussed,
the government has not pointed to any specific statements made in those negotiations from which
the district court could infer that Sbeih was trying to remain in Israel in order to have leverage in
those plea negotiations. See id. at 386. We also note that, absent waiver, plea discussions are
No. 16-3209 United States v. $525,695.24, et al. Page 14
usually not admissible as evidence in criminal or civil proceedings. United States v. Mezzanatto,
513 U.S. 196, 200 (1995) (citing Fed. R. Evid. 410 and Fed. R. Crim. P. 11(e)(6)).
Because of the sparsity of the district court’s record, it is not clear that the government
has satisfied its burden of showing that Sbeih was staying outside the United States in order to
avoid prosecution. As noted previously, many of the relevant conversations between the
attorneys and the district court were conducted off the record, and thus we have no way of
knowing to what extent Sbeih refuted the government’s allegations regarding his intent to evade
criminal proceedings. Furthermore, we have no way to determine whether Sbeih has a justifiable
reason for not returning to the United States, and would therefore be entitled to pursue his legal
rights in this civil forfeiture matter while remaining in Israel, given that it is unclear what efforts
the government made to counter Sbeih’s allegations or even if such evidence would be available.
We therefore conclude that, based on the record as it has been presented to this Court, the district
court committed clear error in finding that the evidence was sufficient to establish that Sbeih had
the specific intent of staying in Israel to avoid prosecution.
Consequently, we vacate the forfeiture order and remand the action to the district court
for further consideration. In so doing, we express no opinion about whether disentitlement is
appropriate in this case. Instead, remand is necessary so that both the government and Sbeih can
present evidence regarding Sbeih’s intent in refusing to return to the United States. This
evidence should be presented in such a way that it is available for future appellate review. The
district court is then instructed to make detailed factual findings regarding the strength of the
evidence, the credibility of those providing the evidence, and the basis for determining whether
Sbeih should be prevented from defending against civil forfeiture.
CONCLUSION
For the foregoing reasons, we VACATE the judgment of the district court and
REMAND this action to the district court for further proceedings consistent with this opinion.
Specifically, we instruct the district court to conduct further proceedings to develop a sufficient
factual record regarding Sbeih’s intent behind his refusal to return to the United States and to
provide a detailed basis for its determination that disentitlement either is or is not appropriate.