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United States v. Nothaus

United States District Court, W.D. North Carolina, Statesville Division

August 4, 2017

UNITED STATES OF AMERICA,
v.
BERNARD VON NOTHAUS, Defendant.

          FINAL ORDER AND JUDGMENT OF FORFEITURE

          RICHARD L. VOORHEES UNITED STATES DISTRICT JUDGE.

         THIS MATTER IS BEFORE THE COURT on the Government's Motion for Final Order and Judgment of Forfeiture and Supplemental Memorandum in support of its Motion. (Docs. 812, 839). Pursuant to Fed. R. Crim. P. 32.2(c)(2), the Government requests that this Court issue a Final Order and Judgment of Forfeiture on Adjudicated and Unclaimed Assets subject to this ancillary forfeiture proceeding. (Doc. 839 at 1). Specifically, the Government requests a Final Order authorizing disbursement of certain assets to which certain claim petitioners are entitled pursuant to numerous orders of this Court and requests final forfeiture of any remaining assets. Id. at 3. Subsequent to the Government's Supplemental Memorandum, Claim Petitioner David L. Gille filed a Response in Opposition to the Government's Proposed Final Order (Doc. 840) and Claim Petitioner Matthew Pitagora filed a Motion for Clarification (Doc. 841). The Government responded to Pitagora's Motion for Clarification and Pitagora filed a reply. (See Docs. 842, 845). Also before the Court are eight Motions for Immediate Return of Property filed by Claim Petitioners Michael Lunnon, Brenda Ketcherside, Max Price, Trevor Gamble, Frederic Lehrman, Arthur Atkinson, Harriett J. Eck, and Michael J. Eck (Docs. 824-31), and a Motion to Amend filed by Claim Petitioner Vernon L. Robinson (Doc. 820). The Government has filed a Response to Robinson's Motion to Amend, contesting the Motion only to the extent that it may be construed as requesting shipping costs. (Doc. 823). For the reasons that follow, (1) Robinson's Motion to Amend (Doc. 820) is GRANTED IN PART and DENIED IN PART; (2) the objection in Gillie's Response in Opposition to the Government's Motion (Doc. 840) is OVERRULED and, to the extent that the objection is construed as a Motion for Reconsideration, the Motion for Reconsideration is DENIED; (3) Pitagora's Motion for Clarification (Doc. 841) is DENIED; (4) the Motions for Immediate Return of Property (Docs. 824-31) are DENIED AS MOOT; and (5) the Government's Motion for Final Order and Judgment of Forfeiture (Doc. 812), as amended by the Government's Supplemental Memorandum (Doc. 839), is GRANTED WITH MODIFICATION.

         I. PROCEDURAL & FACTUAL BACKGROUND

         A jury convicted Bernard von NotHaus of conspiracy to defraud the United States by making, uttering, and passing counterfeit coins, in violation of 18 U.S.C. § 371, falsely making and forging counterfeit coins, in violation of 18 U.S.C. §§ 485, 2, and uttering and making coins of silver intended for use as current money, in violation of 18 U.S.C. §§ 486, 2. (Doc. 287 at 1). Based on the Superseding Bill of Indictment and the offenses of conviction, this Court issued a Third Preliminary Order of Forfeiture, which designated certain monies and properties-various bars of precious metal, coins, dies and molds, and $254.424.09 in United States currency-as preliminarily forfeited. (Doc. 297 at 1-2). To protect the rights of third parties with interests in the properties preliminarily forfeited, this Court commenced an ancillary forfeiture proceeding wherein third parties could file petitions instituting claims over the properties not deemed contraband per se. Id. at 2-4. On the same day that this Court issued the order commencing the ancillary forfeiture proceeding, this Court also issued an order of final forfeiture, which deemed certain properties, including a vast array of different coins, as contraband per se and not subject to claims or possession by third parties. (See Doc. 296).

         Following this Court's Third Preliminary Order of Forfeiture, the Government published several notices regarding the ancillary forfeiture proceeding and sent personal notices to those individuals that the Government had reason to believe had an interest in the property and monies preliminarily forfeited. (Doc. 616-1, see also Doc. 779-2). The Court received 327 claim petitions from 310 claim petitioners.[1] Of the 327 claim petitions, the Government did not contest 275 claim petitions from 266 different claim petitioners, (Doc 633), and this Court issued an Order granting those 275 claim petitions.[2] (Doc. 648). As to the remaining fifty-two claim petitions, this Court permitted limited discovery on several petitions (See Docs. 649-52) before entertaining the Government's motions on all fifty-two remaining claim petitions. Of the remaining fifty-two claim petitions, (1) five claim petitions were granted following the Government moving to grant those claim petitions (See Doc. 754, 755, 795, 798, 802); (2) thirty-two claim petitions were granted in part and denied in part (See Docs. 716, 717, 718, 720, 721, 722, 723, 733, 740, 741, 742, 743, 744, 745, 746, 747, 748, 749, 750, 757, 758, 759, 760, 794, 796, 801); (3) twelve claim petitions were denied (See Docs. 719, 731, 734, 735, 736, 737, 738, 739, 761, 797, 799, 800); (4) two claim petitions were settled before this Court took any action addressing the potential merits of the claim petitions (Docs. 708; 808); and (5) one claim petition was settled after this Court granted in part and denied in part the Government's motion to dismiss the claim petition and scheduled a hearing on the claim petition (Doc. 838, see Docs. 832, 834).

         II. DISCUSSION

         The Government has filed a Motion for Final Order and Judgment of Forfeiture and Supplemental Memorandum in support of its Motion (Docs. 812, 839). Several claim petitioners also have pending motions or objections before the Court. The Court will consider the motions and objections of the claim petitioners before reaching the Government's Motion for Final Order and Judgment of Forfeiture.

         A. Motion to Amend by Claim Petitioner Robinson

         Robinson's Motion to Amend asks the Court to re-account for 500 troy ounces of silver that Robinson alleges had been transferred out of his NORFED account to the benefit of Claim Petitioner William Lawson prior to the Government seizing NORFED's assets as part of the criminal investigation into von NotHaus. (Doc. 820 at 1-4). In his Motion to Amend, Robinson acknowledges that he previously failed to produce evidence demonstrating that the silver was transferred out of his account before the seizure, but he contends that he has now located a screenshot of his NORFED account establishing when the transfer occurred. Id. at 3, (see also Doc. 820-1 at 2). Robinson asks this Court to amend its earlier orders such that Lawson receives 500 troy ounces of silver from the unclaimed silver seized from NORFED rather than from proceeds otherwise eligible to be distributed to Robinson. (Doc. 820 at 4). Robinson further seeks recovery of 3.75 troy ounces of silver, the shipping cost paid to NORFED for NORFED's transfer of the silver to Lawson. Id. In response, the Government expresses skepticism regarding Robinson's supporting evidence but opts to consent to the Motion to Amend with respect to the 500 troy ounces of silver based on its practice in this case of consenting to claims submitted under penalty of perjury. (Doc. 823 at 2). The Government, however, contests Robinson's right to the 3.75 troy ounces of silver allegedly used to cover shipping costs. Id.

         This Court shares the Government's skepticism regarding whether the 500 troy ounces of silver at issue in Robinson's Motion to Amend were transferred out of Robinson's account prior to the Government's seizure, and the new evidence produced by Robinson (Doc. 820-1) does little to vanquish this Court's skepticism. Nonetheless, in light of the Government's position, this Court GRANTS Robinson's Motion to Amend with respect to the 500 troy ounces of silver such that Robinson shall now be permitted to recover 1852.5135 ounces of silver from the preliminarily forfeited silver and Lawson shall now be permitted to recover 500 ounces of silver from the preliminarily forfeited silver. The Court, however, DENIES Robinson's Motion to Amend with respect to the 3.75 ounces of silver for shipping. Put simply, if the transaction occurred at the time alleged by Robinson in his Motion to Amend, then the 3.75 ounces of silver to cover shipping costs had already been removed from Robinson's account and were the property of NORFED at the time of the seizure. In other words, Robinson cannot simultaneously claim that the transaction occurred such that he does not owe Lawson the 500 ounces of silver while also claiming that the transaction did not occur such that he is entitled to the return of the 3.75 ounces for shipping costs.

         B. Objection by Claim Petitioner David L. Gillie

         This Court granted in part and denied in part David L. Gillie's claim to certain preliminarily forfeited property. (See Doc. 760 (addressing Doc. 499, Gillie's amended first claim petition)).[3]Relative to the denial, the Court concluded that certain coins Gillie sought to recover, including “five hundred (500) ½ ounce silver Peace coins” were contraband per se and could not be returned to Gillie. See Id. at 3; (see also Doc. 296). In his objection, which this Court also construes as a Motion for Reconsideration as to Document 760, Gillie seeks to recover coins he calls the “Stop the War” coin. (Doc. 840 at 2). The Court concludes that the coin Gillie refers to as the “Stop the War” coin is the “Peace” coin as the head's side of the coin features the word “PEACE” above a head logo of the Statue of Liberty while the tail's side of the coin features the phrase “STOP THE WAR” above a depiction of the Statue of Liberty's torch. (See Doc. 784-1). Accordingly, this Court has previously determined that the coin Gillie calls the “Stop the War” coin is contraband per se. Therefore, Gillie's objection to the Government's Motion Final Order and Judgment of Forfeiture is OVERRULED and, to the extent that his objection is construed as a Motion for Reconsideration, reconsideration is DENIED.

         C. Motion for Clarification by Claim Petitioner Matthew Pitagora

         In his Motion for Clarification, Pitagora asks the Court for an opinion as to whether the California Dollar, Chambersburg Dollar, Milwaukee/ANA Dollar, and Gillie Dollar are contraband per se. (Doc. 841). In response to Pitagora's Motion for Clarification, the Government argues that Pitagora's Motion amounts to a request for an advisory opinion since Pitagora did not seek to recover any of the items listed in his Motion through his claim petition. (Doc. 842). Thus, the Government contends, Pitagora ...


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