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United States v. McCaffity

United States District Court, E.D. North Carolina, Western Division

December 9, 2019

UNITED STATES OF AMERICA
v.
TAMARA PERRY MCCAFFITY, Defendant.

          ORDER

          LOUISE W. FLANAGAN, UNITED STATES DISTRICT JUDGE

         This matter is before the court upon third-party petition filed by Bruce Strother (“Strother”) to determine his interest in property subject to forfeiture. (DE 74). Also before the court is the government's motion to dismiss Strother's petition pursuant to Federal Rule of Criminal Procedure 32.2(c)(1)(A) for lack of standing and failure to state a claim. (DE 76). JP Morgan Chase Bank, National Association (“Chase Bank”) filed a limited response. (DE 75). The issues raised are ripe for ruling. For the following reasons, the court denies Strother's petition and grants the government's motion to dismiss.

         STATEMENT OF THE CASE

         On February 15, 2019, defendant pleaded guilty to one count of conspiracy to commit health care fraud, in violation of 18 U.S.C § 1349, pursuant to plea agreement, wherein defendant agreed to forfeit property specified in a criminal information, along with offense proceeds totaling $771, 269.00. That same day, the court entered order of forfeiture as to proceeds and preliminary order of forfeiture as to real property, whereby the court found the following property, as relevant to the instant petition, forfeitable pursuant to 18. U.S.C. § 982(a)(7) and 21 U.S.C. § 853(p):

One approximately .026 acre tract of real property, with all improvements thereto, located in Durham County, North Carolina, and more fully described in a deed recorded in book 7866, pages 814-815 of the Durham County Registry, being titled in the name of Tamara Perry McCaffity, and having the street address of 5 Elmridge Court, Durham, North Carolina [“the Property”].

(DE 29 at 1-2).[1]

         On April 4, 2019, the government filed declaration of publication of forfeiture notice pursuant to Federal Rule of Criminal Procedure 32.2(e). (DE 45). Following the government's publication of notice, Chase Bank filed petition, asserting its interest in the Property “by virtue of a deed of trust recorded on January 22, 2013, in Book 7170 at Page 402 of the Durham County Public Registry (the “Deed of Trust”).” (DE 51 at 2). In response, the government recognized Chase Bank as the first lien holder of the Property (DE 66), and United States Magistrate Judge Robert B. Jones memorialized the same in his August 19, 2019, order. (DE 67).

         On September 5, 2019, Strother, defendant's father, filed the instant verified petition seeking a hearing to determine his interest in the Property and requesting amendment to the preliminary order of forfeiture. (DE 74). Specifically, Strother requests that forfeiture of the Property be stricken, or alternatively, a constructive trust imposed in his favor. If the Property is not released, Strother requests payment upon sale of the Property in the amount of $36, 000.00, to recoup his mortgage payments on the Property.

         The government moved to dismiss Strother's petition asserting 1) Strother does not have an interest in the Property and 2) Strother has not alleged facts sufficient for the imposition of a constructive trust on the Property in his favor. (DE 76). Chase Bank also filed a limited response, asserting that any interest of Strother's shall be considered subordinate to its first lien on the Property. (DE 75).

         STATEMENT OF FACTS

         The facts alleged in the instant petition may be summarized as follows. Strothers is an “elderly man, ” born March 9, 1938, and is “relatively cut-off from the modern world.” (Pet. (DE 74) at 10). Id. He does not have a computer or an email address. Id. Instead, he has a landline and flip phone but does not send text messages. His last will and testament provides his three daughters an equal share of his estate upon death. (Id. at 2, 13).

         On or about January 17, 2013, defendant and her husband, Edward McCaffity, conveyed the Property to Strother by deed recorded in Book 7170 at Page 33 of the Durham County Public Registry. (Id. at 2). Strother borrowed $95, 000.00 to purchase the Property and continued to pay the mortgage while defendant lived at the Property. Id. Strother alleges he purchased the Property as a “family home” to “provide his loved ones with a place to stay when they had no where else to go ‘after [he was] gone'-not just the defendant.” (Id. at 5).

         In 2016, defendant told Strother, “Dad, you are getting old and I want the deed in my name is case something happens to you.” Id. Thereafter, defendant faxed a general warranty deed to Strother and told him to sign it. (Id. at 13). Defendant suggested the Property would be preserved for dislocated members of Mr. Strother's family and failed to explain the deed was a general warranty deed, leaving him “on ...


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