United States v. Funds in the Amount Thousand

UNITED STATES OF AMERICA, Plaintiff, v. FUNDS IN THE AMOUNT OF ONE HUNDRED THOUSANDAND ONE HUNDRED TWENTY DOLLARS ($100,120.00), Defendant,NICHOLAS MARROCCO and VINCENT FALLON, Claimants.

No. 03 C 03644

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

June 24, 2016

Judge John J. Tharp, Jr.

MEMORANDUM OPINION AND ORDER

The long and tortured history of the case begins with the December 6, 2002 seizure of $100,120 (the "funds") from Vincent Fallon at Union Station in Chicago. The government seized the funds after, among other events, a drug-detection dog (named Deny; pronounced "Denny") alerted to a briefcase containing the currency. The United States filed this action for civil forfeiture of the funds, which, after over a decade of motion practice and two trips to the Seventh Circuit, recently proceeded to a five-day jury trial. The jury returned a verdict for the government, finding the defendant funds forfeit; the Court entered judgment for the government and a decree of forfeiture. The claimants, Nicholas Marrocco and Vincent Fallon, have filed a renewed motion for judgment as a matter of law under Rule 50(b), ECF No. 319, a motion for a new trial under Rule 59, ECF No. 320, and a motion to determine that the forfeiture is constitutionally excessive, ECF No. 321. For the following reasons, the motions are denied.

BACKGROUND

The evidence presented at trial substantially confirmed the facts narrated in the Seventh Circuit's September 19, 2013 Opinion. See United States v. Funds in Amount of One Hundred Thousand One Hundred & Twenty Dollars ($100,120.00), 730 F.3d 711, 713-15 (7th Cir. 2013) ("Funds II"); see also United States v. Marrocco, 578 F.3d 627, 629-31 (7th Cir. 2009) ("Funds I"). This Opinion assumes familiarity with the earlier decisions and will summarize the facts only as relevant to the pending motions.

The thirteen-year history of this case is awash with pre-trial rulings, reversals and remands, and new or revised rulings. Upon the second remand from the Seventh Circuit and Judge Bucklo's transfer of the case, this Court issued a number of significant pre-trial rulings that acutely limited the government's case. Because, notwithstanding the Seventh Circuit's ruling in Funds II, the government had persisted in its argument that the reliability of dog-sniff evidence could not be challenged and had failed to contest the expert evidence the claimants offered, this Court held that the government forfeited any objections to the claimants' experts. See United States v. Funds in the Amount of One Hundred Thousand & One Hundred Twenty Dollars ($100,120.00), 127 F. Supp. 3d 879, 882-84 (N.D. Ill. 2015) ("Funds III") ("[The government's] insistence on spitting into the wind [ ] has substantially damaged its case."). Because of the extensive delay in naming its own expert, the government also forfeited the opportunity to offer evidence establishing a scientific basis (known as the "Furton theory") to counter the claimants' defense that drug-dog alerts are meaningless because most American currency is tainted with residue from illegal narcotics. Id at 884-85; see also id. at 896-902 (denying government's motion to reconsider). Along the same lines, the Court precluded any opinion testimony by Officer King (Deny's handler) regarding what substance Deny alerted to (e.g., methyl benzoate evaporating from the currency, as suggested by the Furton theory), eitherin training exercises or in the field. Id. at 885-86. The Court also declined to reverse Judge Bucklo's prior ruling granting the claimants' motion to suppress Fallon's custodial statements made in the Amtrak office at Union Station (as well as the declaration that Fallon signed disclaiming an interest in the funds). Id. at 891-92; see also id. at 902-05 (denying government's motion to reconsider); see also United States v. Funds in Amount of One Hundred Thousand & One Hundred Twenty Dollars, 361 F. Supp. 2d 757, 762 n.1 (N.D. Ill. 2005) (Bucklo, J.), rev'd on other grounds in Funds I.

Additionally, the claimants won the vigorously contested debate concerning the jury instruction setting forth the elements the government was required to prove by a preponderance of the evidence, specifically whether the "substantial connection" language of 18 U.S.C. § 983 applies to each of the potential theories of forfeiture—that the funds were (1) furnished or intended to be furnished in exchange for a controlled substance; (2) the proceeds from the sale of a controlled substance; or (3) monies used or intended to be used to facilitate a controlled substances transaction. See 21 U.S.C. § 881(a)(6) (moneys subject to forfeiture). The government's proposed instruction only required proof of a substantial connection between the money and a controlled substance under the facilitation theory of forfeiture. See Gov. Prop. Inst. Nos. 25-27, ECF No. 273. The claimants' proposed elements instruction and argument on the instructions urged the Court to require the government to prove a substantial connection between the money and a controlled substance under any of the statutory forfeiture bases. See Cl. Prop. Inst. Nos. 26, 28, ECF No. 280.

After three rounds of discussion on this particular instruction (at the December 18, 2015 pre-trial conference, the January 22, 2016 pre-trial conference, and on January 28, 2016, prior to the close of the claimants' case), the Court concluded that the "substantial connection" languagein the Civil Asset Forfeiture Reform Act of 2000 ("CAFRA") applies to all three theories of forfeiture. See Pub. L. No. 106-185, 114 Stat. 202 (2000) (codified as amended at 18 U.S.C. §§ 981, 983); see also 21 U.S.C. § 881(a)(6). The Court drafted a jury instruction on the elements, requiring the jury to find both a substantial connection between the funds and an unlawful controlled substance and that the funds were (1) furnished or intended to be furnished in exchange for a controlled substance; (2) the proceeds from the sale of a controlled substance; or (3) monies used or intended to be used to facilitate a controlled substances transaction. See Jury Inst. 6, ECF No. 311.

Despite the many rulings that severely constrained the government's case and increased its evidentiary burden, the jury nonetheless found for the government. The claimants now ask the Court to set aside the jury's verdict and enter judgment for them as a matter of law, or to grant them a new trial, or to reduce or eliminate the forfeiture as constitutionally excessive.

DISCUSSION

I. Rule 50(b) Motion for Judgment as a Matter of Law

Judgment as a matter of law is proper if "a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue." Fed. R. Civ. P. 50(a)(1). Rule 50(b) allows a party to renew a denied motion for judgment as a matter of law within 28 days of an adverse jury verdict. Fed. R. Civ. P. 50(b). In considering a Rule 50(b) motion, the court "construes the evidence strictly in favor of the party who prevailed before the jury and examines the evidence only to determine whether the jury's verdict could reasonably be based on that evidence." Passananti v. Cook Cty., 689 F.3d 655, 659 (7th Cir. 2012). Although the court "must determine that more than a mere scintilla of evidence supports the verdict," it must not "make credibility determinations or weigh the evidence." May v. Chrysler Grp., LLC, 716 F.3d 963, 971 (7th Cir. 2013) (citations and internal quotation marks omitted). Rather, the role of the court is to"decide whether a highly charitable assessment of the evidence supports the jury's verdict or if, instead, the jury was irrational to reach its conclusion." Id.

"Because the Rule 50(b) motion is only a renewal of the preverdict motion, it can be granted only on grounds advanced in the preverdict motion." Passananti, 689 F.3d at 660 (quoting Fed. R. Civ. P. 50(b), comm. note (2006 amend.)). At the close of the government's case, the claimants moved for judgment as a matter of law,¹ arguing that the evidence the government presented failed to establish a substantial connection between the funds and a controlled substance. The claimants highlighted that there had been no evidence of a drug transaction and that, therefore, there could not be any proceeds from such a transaction, nor had there been any evidence of a controlled substance for which the funds had been furnished or intended to be furnished. Without any such evidence, claimants argued that there was not a scintilla of evidence connecting the funds to a controlled substance, let alone substantially connecting them. Although the Court agreed that there had been no evidence of a specific drug transaction (no one expected any such evidence), the Court reminded claimants that the principal focus of this case since day one had been the positive alert by the drug dog. Citing the Seventh Circuit in Funds II, the Court explained that it was for the jury to determine the probative value of the dog-sniff and, therefore, denied the motion. The claimants renewed their motion at the close of all of the evidence, which the Court denied for the same reasons.

The claimants have now renewed their initial motion for judgment as a matter of law under Rule 50(b), reasserting their prior arguments that the government did not present anyevidence of a controlled substance offense. Mot. JMOL ¶¶ 6-8. The claimants also argue that the Court is limited to consideration of the evidence presented in the government's case-in-chief because they are renewing the motion they made at the close of the government's case.² Reply JMOL 1-3, ECF No. 335. It is unnecessary to decide whether the Court is permitted to consider evidence introduced outside of the government's case-in-chief because, even under the limited review of the evidence presented at the time of the original motion, the claimants have failed to establish that no rational jury could have rendered a verdict for the...