United States v. $671,160.00 in U.S. Currency , 730 F.3d 1051 ( 2013 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 11-56924
Plaintiff-Appellee,
D.C. No.
v. 2:10-cv-08934-
GW-AGR
$671,160.00 IN U.S. CURRENCY,
Defendant,
OPINION
and
MIKE IONITA,
Claimant-Appellant.
Appeal from the United States District Court
for the Central District of California
George H. Wu, District Judge, Presiding
Submitted August 9, 2013*
Pasadena, California
Filed September 18, 2013
Before: Richard C. Tallman, Richard R. Clifton,
and Consuelo M. Callahan, Circuit Judges.
Opinion by Judge Tallman
*
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
2 UNITED STATES V. $671,160 IN U.S. CURRENCY
SUMMARY**
Civil Forfeiture / Fugitive Disentitlement Statute
The panel affirmed the district court’s dismissal, based on
the Fugitive Disentitlement Statute, of Mike Ionita’s verified
claim to $671,170 in currency seized from a vehicle rented by
Ionita, and the resulting default judgment in favor of the
United States.
The panel held that Ionita, who returned to his home in
Canada before a criminal complaint was filed in California in
this case, met the statutory definition of a fugitive from
justice. The panel held that the totality of the circumstances
supported the district court’s conclusion that Ionita had
intentionally declined to return to the United States so as to
avoid submitting to the jurisdiction of the California courts
and consequently facing the criminal charges pending against
him, and as a result Ionita was a fugitive under 28 U.S.C.
§ 2466. The panel also held that the district court did not err
in denying Ionita’s request to convert the government’s
motion to strike into a motion for summary judgment.
Finally, the panel declined to address Ionita’s remaining
arguments because they were barred by the Fugitive
Disentitlement Statute, which prohibits him from litigating
issues related to his pending criminal case without subjecting
himself to the jurisdiction of the Los Angeles County
criminal court.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
UNITED STATES V. $671,160 IN U.S. CURRENCY 3
COUNSEL
Paul L. Gabbert, Santa Monica, California, for Claimant-
Appellant.
Katharine Schonbachler, Assistant United States Attorney;
Steven R. Welk, Assistant United States Attorney, Chief,
Asset Forfeiture Section; Robert E. Dugdale, Assistant United
States Attorney, Chief, Criminal Division; André Birotte, Jr.,
United States Attorney, United States Attorneys’ Office, Los
Angeles, California, for Plaintiff-Appellee.
OPINION
TALLMAN, Circuit Judge:
This case involves the forfeiture of $671,170 in currency
seized from a vehicle rented by Mike Ionita, a Canadian
citizen. On the government’s motion, the district court
invoked the Fugitive Disentitlement Statute, codified at
28 U.S.C. § 2466,1 to strike Ionita’s claim to the funds.
1
28 U.S.C. § 2466 provides, in relevant part:
(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—
4 UNITED STATES V. $671,160 IN U.S. CURRENCY
Through an attorney, Ionita appeals the district court’s
dismissal of his verified claim and answer, and the resulting
default judgment in favor of the United States, contending
that he does not meet the statutory definition of a fugitive
from justice. We conclude that he does. We have
jurisdiction pursuant to 28 U.S.C. § 1291, and we AFFIRM.
I
Ionita was watched by Anaheim police officers
exchanging luggage with a known narcotics dealer in the
parking lot of a local hotel. The officers called for a marked
police car to initiate a traffic stop, and a subsequent search of
Ionita’s vehicle revealed substantial amounts of currency in
the trunk. Ionita insisted that the money was not his and that
he had no idea how it got there or to whom it belonged. The
money was seized, Ionita was released, and he later returned
to Canada.
On November 19, 2010, the government commenced an
in rem civil forfeiture action pursuant to 21 U.S.C.
§ 881(a)(6) against $671,160 in U.S. currency seized from
(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
(2) is not confined or held in custody in any other
jurisdiction for commission of criminal conduct in that
jurisdiction.
UNITED STATES V. $671,160 IN U.S. CURRENCY 5
Ionita’s rental car. The government contended that the
money was subject to forfeiture on the grounds that the funds
represented or were traceable to proceeds of illegal narcotics
trafficking, or were intended to be used in one or more
exchanges for a controlled substance or listed chemical in
violation of 21 U.S.C. §§ 841, et seq.
A
The government detailed in its civil complaint the events
leading to the seizure of the defendant currency from Ionita
on May 27, 2010. In relevant part, it alleged that “[i]n May
2010, Ionita was identified as a member of a Canadian based
narcotics trafficking organization responsible for transporting
large sums of U.S. currency within the United States and
purchasing large quantities of cocaine for distribution in
Canada.”
The complaint further alleged that, on May 27, 2010,
Anaheim police officers observed Ionita enter a hotel parking
lot while driving a white Mercedes Benz. In the parking lot,
Ionita approached a 2007 Cadillac Escalade pickup truck
registered to Robert Russell Allen, who “ha[d] an extensive
criminal history including multiple narcotics arrests and
convictions, including but not limited to cocaine conspiracy
and money laundering.” The truck’s driver, identified as
Allen, removed two pieces of luggage, a black carry-on
suitcase and a black duffle bag, from his Escalade and
transferred them to the trunk of Ionita’s Mercedes Benz.
Surveillance photos captured the exchange. Allen and Ionita
then left the parking lot in their respective vehicles.
Officers believed that “[t]he conduct of the two men
[observed in the hotel parking lot] was consistent with a
6 UNITED STATES V. $671,160 IN U.S. CURRENCY
delivery of drugs or drug-related money.” To confirm their
suspicions, Anaheim police officers requested that an officer
in a marked El Monte police car conduct a traffic stop on
Ionita’s vehicle. The stop was initiated after Ionita changed
lanes without signaling, in violation of California Vehicle
Code § 22107. After being stopped, Ionita provided the
uniformed officer with his Canadian driver’s license and
rental car agreement, but was unable to recall the addresses
for the locations that he was purportedly visiting in
Hollywood and Ontario.
His suspicions aroused, the El Monte officer requested
Ionita’s consent to search his vehicle, which Ionita refused.
The officer then called for a narcotics-detecting canine to
sniff the exterior of the Mercedes Benz. After the canine
alerted to the odor of narcotics coming from three sections of
the vehicle, the officer conducted a search of the Mercedes
Benz and located the two pieces of luggage stored in the
trunk. Upon opening the luggage, the officer discovered
$671,170 in U.S. currency.
Ionita denied any knowledge of the luggage and
immediately signed a disclaimer of ownership form for the
defendant currency. Police then seized and later transferred
the funds to the Drug Enforcement Administration for further
investigation and to initiate federal forfeiture proceedings.
Ionita was not detained further and he ultimately returned to
Canada, where he continues to reside.
B
On December 17, 2010, the Los Angeles County District
Attorney filed a criminal complaint charging Ionita with
violating California Health & Safety Code § 11370.6(a) by
UNITED STATES V. $671,160 IN U.S. CURRENCY 7
“possessi[ng] money or instruments over $100,000 . . . which
were obtained as the result of the unlawful trafficking of [a]
controlled substance . . . and . . . possess[ed] . . . with the
intent to unlawfully purchase [a] controlled substance.” On
December 21, 2010, a California Superior Court judge signed
a felony warrant authorizing Ionita’s arrest on the pending
criminal charge. Bail was fixed by the court at $600,000.
Although Ionita has been notified of the charge, he has not
appeared in Los Angeles to contest or answer the criminal
charge.
Instead, Ionita has only appeared in the United States
District Court, through counsel, to contest the civil forfeiture
proceedings. On December 20, 2010, Ionita filed a verified
claim “demand[ing] restitution of the defendant $671,160
[sic] in U.S. currency.” Additionally, on February 10, 2010,
Ionita formally answered the forfeiture complaint, generally
denying the allegations of criminal activity and asserting that
he was the true owner of the seized funds.
Because Ionita had not surrendered on the criminal arrest
warrant, the government filed a motion to strike Ionita’s
claim pursuant to the Fugitive Disentitlement Statute,
codified at 28 U.S.C. § 2466. Despite numerous
opportunities afforded by the district court, Ionita has not
personally appeared in Los Angeles to contest the application
of the statute. Additionally, in response to discovery
propounded by the United States in the forfeiture case, Ionita
has asserted his Fourth, Fourteenth, and Fifth Amendment
rights. After reviewing extensive briefing, evidentiary
submissions, and holding hearings, the district court granted
the government’s motion to strike, ruling that Ionita’s claim
was barred by the statute. With no other claimants to the
forfeited funds, the court granted a motion for default and
8 UNITED STATES V. $671,160 IN U.S. CURRENCY
entered judgment against the defendant res in favor of the
United States. This appeal followed. We have jurisdiction
pursuant to 28 U.S.C. § 1291.
II
While we review the legal applicability of the Fugitive
Disentitlement Statute de novo, we review a district court’s
decision to order disentitlement for abuse of discretion.
Collazos v. United States, 368 F.3d 190, 195 (2d Cir. 2004);
United States v. Salti, 579 F.3d 656, 662–63 (6th Cir. 2009).
We consider the government’s motion to strike a claim
pursuant to the statute “as something like a motion to dismiss,
[where we can] look[] to matters outside the pleadings,
and . . . , where appropriate, allow[] for the possibility of
conversion to summary judgment.” United States v.
$6,976,934.65 Plus Interest, 478 F. Supp. 2d 30, 38 (D.D.C.
2007).
III
28 U.S.C. § 2466 has five required elements:
(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 or process; (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 leaving the United States,
declining to enter or reenter the country, or
UNITED STATES V. $671,160 IN U.S. CURRENCY 9
otherwise evading the criminal court’s
jurisdiction.
United States v. $6,190.00 in U.S. Currency, 581 F.3d 881,
886 (9th Cir. 2009). Ionita concedes that all of the elements
of the Fugitive Disentitlement Statute are met but
one—whether he remains outside of the United States “in
order to avoid criminal prosecution”—in other words,
whether he meets the statutory definition of being a fugitive
from justice.
A
Ionita argues that he returned to his home in Vancouver,
Canada, before the criminal complaint was filed in this case
and, therefore, he cannot be said to have left the United States
“in order to avoid criminal prosecution.” 28 U.S.C.
§ 2466(a)(1). Instead, Ionita claims that he remains in
Canada not to “evade the [state] court’s jurisdiction,” but
insists that he “merely returned to his home.” Ionita argues
that “the fugitive disentitlement statute [cannot] be satisfied
simply by continuing to live in one’s own country at the time
that a charging document was filed in a state court.”
Ionita’s arguments primarily relate to the time period after
he returned to Canada and before the California criminal
complaint was filed. However, Ionita may still be considered
a fugitive, as that term is defined in § 2466, if he failed to
“enter or reenter the United States” in order to avoid criminal
prosecution once he learned that the California complaint had
10 UNITED STATES V. $671,160 IN U.S. CURRENCY
been filed and a warrant for his arrest had issued.2 28 U.S.C.
§ 2466(a)(1)(B). It is of no consequence that Ionita did not
flee the jurisdiction upon learning of the criminal complaint
and warrant for his arrest. Instead, according to the statutory
text, a claimant may still be a fugitive if, while legally outside
the jurisdiction, he decides not to return to the United States
to face a pending criminal charge. Id. There is no dispute
that Ionita knows full well that he is wanted by the State of
California. Ionita’s attempt to reclaim the defendant funds by
litigating the civil forfeiture claim while avoiding answering
the criminal charge is precisely the situation that the Fugitive
Disentitlement Statute was enacted to address.
B
The totality of the circumstances supports the district
court’s conclusion that Ionita has intentionally declined to
return to the United States so as to avoid submitting to the
jurisdiction of the California courts and consequently facing
the criminal charge pending against him. As a result, we
conclude that Ionita is a fugitive, as set forth in § 2466(a)(1),
since he made a conscious choice to not “enter or reenter the
2
The existence of other factors that might have also motivated Ionita to
remain abroad, such as his Canadian citizenship and residency, does not
undermine or foreclose the district court’s finding that Ionita 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). Ionita’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,” Ionita “declines to enter or reenter the United States to
submit to its jurisdiction.” Id. There is sufficient evidence here to support
that determination.
UNITED STATES V. $671,160 IN U.S. CURRENCY 11
United States” in order to avoid criminal proceedings or is
otherwise evading the jurisdiction of the California Superior
Court where the criminal case against him is pending.
We acknowledge that our sister circuit has held that
“mere notice or knowledge of an outstanding warrant,
coupled with a refusal to enter the United States, does not
satisfy the [fifth element of the fugitive disentitlement]
statute.” United States v. $6,976,934.65 Plus Interest,
554 F.3d 123, 132 (D.C. Cir. 2009). However, in the case
before us, the evidence demonstrates more than mere notice
and refusal.
The evidence here establishes that, after learning that
there was a criminal complaint and warrant issued for his
arrest, Ionita has not returned to contest or answer the
criminal charge.3 Ionita’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. The district court properly relied on Ionita’s failure
to return, which appears to be deliberate in light of his
3
The text of the Fugitive Disentitlement Statute does not support
Ionita’s argument that the government must initiate formal or informal
methods to extradite a claimant or return him to the United States before
it may invoke the statute and strike a fugitive’s claim. 28 U.S.C. § 2246.
We do not impose such a requirement. Actual knowledge that criminal
charges are pending, and a refusal to return to the United States in order
to avoid answering to those charges, will suffice for due process purposes.
The record shows that Ionita has been in regular contact with his counsel
in Los Angeles and is well aware that he is a wanted man. One of his
reasons for not returning to the United States is his unwillingness to post
the bail fixed by the California Superior Court judge who issued the arrest
warrant.
12 UNITED STATES V. $671,160 IN U.S. CURRENCY
behavior and actions during the civil forfeiture proceedings
as set forth below.
Ionita has declined numerous opportunities to personally
appear at hearings in the civil forfeiture proceedings, despite
his interest in now formally claiming entitlement to the
substantial funds to which he initially disclaimed ownership
when stopped on May 27, 2010. Additionally, the district
court could properly conclude by adverse inference that
Ionita’s refusal to answer the special interrogatories
propounded by the government, instead asserting his Fourth,
Fourteenth, and Fifth Amendment rights, was evidence of
Ionita’s intent to avoid criminal prosecution and to selectively
use the courts to his own favor. See United States v. Certain
Real Property and Premises Known as 4003-4005 5th Ave.,
Brooklyn, N.Y., 55 F.3d 78, 82–83 (2d Cir. 1995) (applying
the doctrine of adverse inference in a civil forfeiture action).
Lastly, before the district court, Ionita represented that the
bail set in his criminal case “makes it impossible for him to
return to the United States.” In a hearing on the
government’s motion to strike, Ionita’s counsel stated that the
Los Angeles County District Attorney “filed the criminal case
. . . [t]hereby, basically putting this humongous roadblock
into [Ionita] coming back into the United States.” These
statements confirm that Ionita remains in Canada in order to
avoid execution of or surrendering to the outstanding arrest
warrant should he cross back into the United States.4
4
We decline to adopt Ionita’s argument that these statements were made
solely to support his allegation of government overreaching. On appeal,
Ionita’s statements before the district court cannot be so
compartmentalized and only considered when favorable to the appellant.
Instead, a court must interpret the record, and the statements contained in
UNITED STATES V. $671,160 IN U.S. CURRENCY 13
There are sound policy reasons for applying the Fugitive
Disentitlement Statute in this case. The Fugitive
Disentitlement Doctrine “is grounded on the impropriety of
permitting a fugitive to pursue a claim in federal court where
he might accrue a benefit, while at the same time avoiding an
action of the same court that might sanction him.” United
States v. Eng, 951 F.2d 461, 465 (2d Cir. 1991). That is
precisely the tactic that Ionita seeks to employ in this case.
Ionita, “facing both incarceration and forfeiture for his
misdeeds, attempts to invoke from a safe distance only so
much of a United States court’s jurisdiction as might secure
him the return of alleged criminal proceeds while carefully
shielding himself from the possibility of a penal sanction.”
Collazos, 368 F.3d at 200. Accordingly, the district court
could readily conclude, based on the totality of the evidence,
that Ionita has “decline[d] to enter or reenter the United
States to submit to its jurisdiction” in order to avoid criminal
prosecution. 28 U.S.C. § 2466(a)(1)(B). The fifth element is
met, as the district court properly found.
IV
Ionita argues that, even if all elements of the Fugitive
Disentitlement Statute have been satisfied, the district court
nonetheless abused its discretion in striking his answer and
claim to the defendant currency. Ionita notes that § 2466
does not mandate disentitlement but rather, “[a] judicial
officer may disallow a person from using the resources of the
courts of the United States.” 28 U.S.C. § 2466(a) (emphasis
added). “[T]he ultimate decision whether to order
disentitlement in a particular case rests in the sound discretion
it, according to their natural and rational meaning as applied to all of the
issues presented in the case.
14 UNITED STATES V. $671,160 IN U.S. CURRENCY
of the district court.” $6,190.00, 581 F.3d at 886 (internal
quotation marks omitted).
Ionita alleges that the district court should have declined
to order disentitlement in light of evidence of government
overreaching. Ionita argues that the federal and state
government must have colluded in a nefarious plot to bolster
the civil forfeiture case and prevent Ionita from reclaiming
his property. As evidence of this collusion, Ionita relies
primarily on a timing argument—that the Los Angeles
County District Attorney filed criminal charges against Ionita
one day after Ionita executed a verified claim to the defendant
currency.
After requesting briefing, holding hearings, and reviewing
submitted evidence, the district court properly found that
Ionita’s accusations were baseless since criminal charges
were being pursued before Ionita ever filed a claim in the
forfeiture action.5 The district court found that a superior
court case number was issued and the felony complaint was
actually signed four days before Ionita filed his federal claim.
In light of this evidence, we conclude that the district court
did not abuse its discretion in disentitling Ionita under § 2466
and striking his answer and claim to the forfeited funds.
5
The district court reviewed “the evidentiary material that was used for
establishing probable cause for [Ionita’s] arrest . . . and also for the
subsequent issuance of the felony arrest warrant.” The district court
agreed with the Superior Court and concluded “based upon what the
government has provided that there was sufficient evidence of probable
cause vis-a-vis the crime.”
UNITED STATES V. $671,160 IN U.S. CURRENCY 15
V
Ionita also contends that the district court erred by not
converting the government’s motion to strike into a motion
for summary judgment. Ionita alleges that the court should
have allowed the parties to take additional discovery prior to
concluding that Ionita is a fugitive within the meaning of
28 U.S.C. § 2466. Ionita’s claim of error is perplexing, given
his refusal to participate in or respond to discovery
propounded by the United States in the district court action.
Instead, Ionita asserted his Fifth, Fourteenth, and Fourth
Amendment rights in response to the government’s
interrogatories. Further, discovery on this subject would be
unnecessary and futile and the district court could properly
draw an adverse inference from Ionita’s invocation of his
right to remain silent by refusing to answer the questions
propounded. Certain Real Property, 55 F.3d at 82–83.
Ionita’s reasons for remaining in Canada lie exclusively in
Ionita’s mind and cannot be uncovered by requesting
information from third parties.
Secondly, unlike in $6,976,934.65, summary judgment is
not necessary to fill a void in the record where further
information is required to determine the relationship between
the fugitive and the claimant. 478 F. Supp. 2d at 38. And, in
contrast to Salti, summary judgment is not warranted to
reconcile contradictory information contained in a declaration
submitted by the claimant regarding his reasons for remaining
abroad. 579 F.3d at 665. Unlike the claimant in Salti, Ionita
has not submitted declarations or other admissible evidence
to contradict the government’s claims that he has not
reentered the United States in order to avoid criminal
prosecution. Id.16 UNITED STATES V. $671,160 IN U.S. CURRENCY
Here, the district court had sufficient information to
determine that all elements of the Fugitive Disentitlement
Statute had been satisfied and properly granted the
government’s motion to strike. We conclude that the district
court did not err in denying Ionita’s request to convert the
government’s motion into a motion for summary judgment.
VI
Lastly, we decline to address Ionita’s remaining
arguments regarding whether there was probable cause to
search his vehicle, seize the defendant funds, or initiate
criminal proceedings against him. Ionita cites to no authority
suggesting that these arguments can be raised in a related
civil proceeding while Ionita remains sheltered in a foreign
country avoiding criminal process.
Ionita’s arguments are barred by the Fugitive
Disentitlement Statute, which prohibits him from litigating
issues and obtaining favorable rulings related to his pending
criminal case without subjecting himself to the jurisdiction of
the Los Angeles County criminal court. The purpose of the
Fugitive Disentitlement Statute is to bar precisely this sort of
issue shopping by a fugitive claimant. See $6,190.00,
581 F.2d at 885 (“The fugitive disentitlement doctrine
prohibits an individual from using the courts to further one
claim while avoiding the courts’ jurisdiction on another
matter.”).
Therefore, once a court determines that the Fugitive
Disentitlement Statute applies, a claimant’s further defenses
to the underlying criminal matter are irrelevant. See
$6,976,934.65, 486 F. Supp. 2d at 39 (“Section 2466
empowers a court of competent jurisdiction to disentitle a
UNITED STATES V. $671,160 IN U.S. CURRENCY 17
fugitive, thus stripping him of any defenses he may have”).
If Ionita believes that his arguments have merit, he can
voluntarily terminate his fugitive status and surrender himself
to the jurisdiction of the California courts to answer the
criminal charge. Until that time, Ionita cannot, safely from
afar, use civil forfeiture proceedings to chisel away at the
related California criminal case pending against him.
VII
Ionita may not use the court’s resources to pursue a civil
forfeiture claim while simultaneously evading jurisdiction to
avoid sanction in a related, pending criminal case. As a
fugitive from justice, Ionita “has demonstrated such
disrespect for the legal processes that he has no right to call
upon the court to adjudicate his claim.” Ortega-Rodriguez v.
United States, 507 U.S. 234, 246 (1993) (quoting Ali v. Sims,
788 F.2d 954, 959 (3d Cir. 1986)). The district court
correctly granted the government’s motion to strike Ionita’s
answer and his claim to the defendant currency in
conformance with 28 U.S.C. § 2466. Default judgment was
properly entered thereafter.
AFFIRMED.