United States District Court, E.D. North Carolina, Western Division
W. FLANAGAN, UNITED STATES DISTRICT JUDGE
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.
OF THE CASE
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
(DE 29 at 1-2).
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).
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.
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).
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).
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).
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 ...