United States v. $10,000.00 in United States Currency

• Court: District Court, D. Nevada
• Decided: July 2, 2021
• Docket: 2:20-cv-01782
• Status: Unknown

Opinion

1 2

5 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 6

7 UNITED STATES OF AMERICA, 2:20-CV-1782-GMN-VCF

8 Plaintiff, Default Judgment of Forfeiture and Final Judgment of Forfeiture 9 v.

10 $10,000 IN UNITED STATES CURRENCY, 11 Defendant. 12 13 I. FACTS 14 On May 12, 2020, postal inspectors were notified of a Priority Mail Express parcel 15 that had broken open during the normal course of processing and handling by USPS, 16 exposing contents (described below) indicative of illegal-drugs trafficking. 17 The postal inspectors reported to the parcel’s location—the Las Vegas Processing 18 and Distribution Center in Nevada—and inspected the parcel. 19 The parcel’s sender was listed as Tanisha Hanson (Hanson) and displayed an 20 Austin, Minnesota mailing address. 21 The parcel’s intended recipient was listed as Jamal Ellzey (Ellzey) and displayed a 22 Las Vegas, Nevada mailing address. 23 The postal inspectors observed the readily viewable contents of the parcel, which 24 included cash-shaped bundles wrapped in carbon paper. In the illegal-drugs trade, carbon 25 paper is utilized by individuals attempting to mask items from scanning and odor-detecting 26 technologies. 27 A canine-handler/officer employed by the Las Vegas Metropolitan Police 28 Department deployed his certified, reliable canine—trained to detect the odor of illegal 1 drugs. The canine alerted to the presence of the odor of illegal drugs coming from the 2 parcel. 3 Further investigation disclosed that Hanson was an individual associated with the 4 sender’s address. 5 Further investigation disclosed that Ellzey was an individual associated with the 6 recipient’s address, though it was discovered that Ellzey’s first name was spelled slightly 7 differently: “Jamel” rather than “Jamal.” 8 On May 13, 2020, the postal inspectors located a telephone number for Ellzey and 9 contacted him by telephone. 10 a. When asked whether he was expecting a parcel, Ellzey said “yes” and 11 indicated that the parcel contained DVDs. 12 b. When asked whether the parcel contained anything other than DVDs, 13 Ellzey said “no.” 14 c. At that juncture, the postal inspectors indicated that the parcel appeared 15 to contain something other than DVDs, wrapped in carbon paper. 16 d. Ellzey then said that he was also expecting currency in the parcel. 17 e. When asked how much currency he was expecting, Ellzey was unable to 18 identify the amount and, when asked again, said that he did not know. 19 f. When asked what the money would be used for, Ellzey stated that it was 20 for a poker tournament at a local casino but, then, added that the 21 tournament would take place after the casino reopened, following the 22 Covid-19 shutdown. 23 g. When asked why the currency was not deposited into a bank account, 24 Ellzey did not answer. 25 h. When asked why the currency was wrapped in carbon paper, Ellzey 26 provided no explanation. 27 The postal inspectors then asked Ellzey for consent to open the parcel, which Ellzey 28 granted. 1 Inside the parcel, the postal inspectors discovered, in addition to three DVDs, three 2 bundles of United States currency wrapped in carbon paper. 3 A subsequent count of the currency revealed that it totaled $10,000. It was 4 composed of the following: 5 i. $4,000 in $100 bills (40 bills); 6 j. $3,200 in $50 bills (64 bills); 7 k. $2,780 in $20 bills (139 bills); and 8 l. $20 in $10 bills (2 bills). 9 Currency involved in the illegal-drugs trade is often composed heavily of small 10 denominations, particularly $20 bills. 11 Subsequent investigation revealed that on May 13, 2020, the Austin, Minnesota 12 post office issued a refund (in the form of a postal money order) for the parcel’s postage to 13 an individual named Anthony Wadley (Wadley), who, in turn, cashed the money order. 14 Subsequent investigation revealed that Wadley was also associated with the parcel’s 15 return address. 16 Subsequent investigation revealed three convictions of Wadley for drugs-related 17 crimes: 18 m. On December 2, 2004, Wadley was convicted in Illinois of felony 19 possession of illegal drugs; 20 n. On September 18, 2009, Wadley was convicted in Minnesota of felony 21 possession of illegal drugs; and 22 o. On August 11, 2014, Wadley was convicted in Minnesota of felony 23 possession of illegal drugs. 24 On or around August 7, 2020, Hanson submitted an administrative-claim form with 25 USPS. In it, Hanson stated that the currency was being sent to “a friend for paying off a 26 debt and to purchase a car.” Previously, Ellzey had stated that the currency was intended 27 for a poker tournament at a casino at some point in the future. 28 The $10,000 in United States currency is the entirety of the defendant currency. 1 II. PROCEDURE 2 On September 24, 2020, the United States filed a verified Complaint for Forfeiture 3 in Rem, ECF No. 1, alleging that the $10,000 in United States currency (defendant 4 property): 5 a. is all moneys, negotiable instruments, securities, or other things of 6 value furnished or intended to be furnished in exchange for a 7 controlled substance or listed chemical in violation of Subchapter I of 8 the Controlled Substances Act, 21 U.S.C. § 801, et seq., and is subject 9 to forfeiture to the United States pursuant to 21 U.S.C. § 881(a)(6); 10 b. is all proceeds traceable to an exchange for a controlled substance or 11 listed chemical in violation of Subchapter I of the Controlled 12 Substances Act, 21 U.S.C. § 801, et seq., and is subject to forfeiture to 13 the United States pursuant to 21 U.S.C. § 881(a)(6); 14 c. is all moneys, negotiable instruments, and securities used or intended 15 to be used to facilitate violations of Subchapter I of the Controlled 16 Substances Act, 21 U.S.C. § 801, et seq., and is subject to forfeiture to 17 the United States pursuant to 21 U.S.C. § 881(a)(6); and 18 d. is any property, real or personal, which constitutes or is derived from 19 proceeds traceable to a violation of any offense constituting 20 “specified unlawful activity,” here Subchapter I of the Controlled 21 Substances Act, 21 U.S.C. § 801, et seq. (incorporated through 18 22 U.S.C. §§ 1956(c)(7)(A) and 1961(1)(D)), or a conspiracy to commit 23 such offense, and is subject to forfeiture to the United States pursuant 24 to 18 U.S.C. § 981(a)(1)(C). 25 On November 23, 2020, the Court entered an Order for Summons and Warrant of 26 Arrest in Rem for the Property and Notice, ECF No. 4, and the Clerk issued the Summons 27 and Warrant of Arrest in Rem, ECF No. 5. 28 / / / 1 Pursuant to the Order, ECF No. 4, the following documents were served on the 2 defendant property and all persons or entities who may claim an interest in the defendant 3 property: the Complaint, ECF No. 1, the Order, ECF No. 4, the Summons and Warrant, 4 ECF No. 5, and the Notice of Complaint for Forfeiture. Notice was published according to 5 law. 6 Pursuant to Supplemental Rule for Admiralty or Maritime Claims and Asset 7 Forfeiture Actions (Fed. R. Civ. P. Supp. Rule) G(5), all persons or entities interested in 8 the defendant property were required to: (1) file a verified claim, setting forth the person’s 9 or its interest in the property, that (a) identified the specific property claimed, (b) identified 10 the claimant and stated the claimant’s interest in the property, and (c) was signed by the 11 claimant under penalty of perjury pursuant to 28 U.S.C. § 1746; (2) file the verified claim 12 with the Clerk of the above-entitled Court no later than 35 days after the notice was sent or, 13 if direct notice was not sent, no later than 60 days after the first day of publication on the 14 official internet government forfeiture site, www.forfeiture.gov; (3) file an answer to the 15 Complaint for Forfeiture in Rem or a motion under Rule 12 with the Clerk of the Court, 16 Lloyd D. George United States Courthouse, 333 Las Vegas Boulevard South, Las Vegas, 17 NV 89101, no later than 21 days after filing the verified claim; and (4) serve a copy of the 18 verified claim and the answer at the time of each filing on James A. Blum, Assistant United 19 States Attorney, 501 Las Vegas Boulevard South, Suite 1100, Las Vegas, Nevada 89101. 20 Complaint, ECF No. 1; Order for Summons and Warrant, ECF No. 4; Summons and 21 Warrant, ECF No. 5. 22 On November 25, 2020, the United States Marshals Service served the Complaint, 23 the Order for Summons and Warrant of Arrest in Rem for the Property and Notice, the 24 Summons and Warrant of Arrest in Rem for the Property, and the Notice of Complaint for 25 Forfeiture and Arrest by executing them on the defendant property. Notice of Take into 26 Custody, ECF No. 6-1, p. 2. 27 Public notice of the forfeiture action and arrest was given to all persons and entities 28 by publication via the official internet government forfeiture site, www.forfeiture.gov, from 1 January 16, 2021, through February 14, 2021. Notice of Filing Proof of Publication, ECF 2 No. 7-1, p. 5. 3 On January 13, 2021, the United States Attorney’s Office served Jamal (Jamel) 4 Ellzey by regular and certified return receipt mail with the Complaint for Forfeiture in 5 Rem, the Order for Summons and Warrant of Arrest in Rem for the Property, the 6 Summons and Warrant of Arrest in Rem, and the Notice of Complaint for Forfeiture and 7 Arrest. Notice of Filing Service of Process – Mailing, ECF No. 8-1, p. 3, 5-6, 8-22, 24-26, 8 37. 9 On January 13, 2021, the United States Attorney’s Office served and attempted to 10 serve Jamal (Jamel) Ellzey by regular mail and certified return receipt mail with the 11 Complaint for Forfeiture in Rem, the Order for Summons and Warrant of Arrest in Rem, 12 the Summons and Warrant of Arrest in Rem, and the Notice of Complaint for Forfeiture 13 and Arrest. The certified mail was returned as unclaimed and unable to forward. Notice of 14 Filing Service of Process – Mailing, ECF No. 8-1, p. 3, 5-6, 8-22, 27-30. 15 On January 13, 2021, the United States Attorney’s Office served Tanisha Hanson by 16 regular and certified return receipt mail with the Complaint for Forfeiture in Rem, the 17 Order for Summons and Warrant of Arrest in Rem for the Property, the Summons and 18 Warrant of Arrest in Rem, and the Notice of Complaint for Forfeiture and Arrest. Notice 19 of Filing Service of Process – Mailing, ECF No. 8-1, p. 3, 5-6, 8-22, 31-33, 37. 20 On January 13, 2021, the United States Attorney’s Office served Anthony Wadley 21 by regular and certified return receipt mail with the Complaint for Forfeiture in Rem, the 22 Order for Summons and Warrant of Arrest in Rem for the Property, the Summons and 23 Warrant of Arrest in Rem, and the Notice of Complaint for Forfeiture and Arrest. Notice 24 of Filing Service of Process – Mailing, ECF No. 8-1, p. 3, 5-6, 8-22, 34-37. 25 On January 15, 2021, the United States Marshals Service attempted to personally 26 serve the Complaint, the Order for Summons and Warrant of Arrest in Rem for the 27 Property and Notice, the Summons and Warrant of Arrest in Rem for the Property, and the 28 / / / 1 Notice of Complaint for Forfeiture and Arrest on Jamal (James) Ellzey. Notice of Filing 2 Service of Process – Personal Service, ECF No. 9-1, p. 3. 3 No person or entity has filed a claim, answer, or responsive pleading within the time 4 permitted by 18 U.S.C. § 983(a)(4) and Fed. R. Civ. P. Supp. Rule G(4) and (5). 5 On April 22, 2021, the United States filed a Motion for Entry of Clerk’s Default 6 against the $10,000 in United States Currency, Jamal (Jamel) Ellzey, Tanisha Hanson, 7 Anthony Wadley, and all persons or entities who may claim an interest in the defendant 8 property in the above-entitled action. Motion for Entry of Clerk’s Default, ECF No. 10. 9 On May 6, 2021, the Clerk of the Court entered a Default against the $10,000 in 10 United States Currency, Jamal (Jamel) Ellzey, Tanisha Hanson, Anthony Wadley, and all 11 persons or entities who may claim an interest in the defendant property in the above- 12 entitled action. Entry of Clerk’s Default, ECF No. 11. 13 Jamal (Jamel) Ellzey is not in the military service within the purview of the 14 Servicemembers Civil Relief Act of 2003. 15 Tanisha Hanson is not in the military service within the purview of the 16 Servicemembers Civil Relief Act of 2003. 17 Anthony Wadley is not in the military service within the purview of the 18 Servicemembers Civil Relief Act of 2003. 19 Jamal (Jamel) Ellzey is neither a minor nor an incompetent person. 20 Tanisha Hanson is neither a minor nor an incompetent person. 21 Anthony Wadley is neither a minor nor an incompetent person. 22 III. The Requirements for Default were met. 23 A. Legal Standard 24 Civil forfeiture cases have five requirements that must be fulfilled to complete a 25 default: (1) the judgment sought does not differ in kind from, or exceed in amount, what is 26 demanded in the pleadings pursuant to Fed. R. Civ. P. 54(c); (2) the Clerk of the Court has 27 entered default for a sum certain pursuant to Fed. R. Civ. P. 55(b)(1); (3) publication and 28 personal service were completed pursuant to Fed. R. Civ. P. Supp. Rule G(4); (4) the 1 Complaint is legally sufficient to support a reasonable belief that the government will be 2 able to meet its burden of proof pursuant to Fed. R. Civ. P. Supp. Rule G(2), Alan Neuman 3 Prods., Inc. v. Albright, 862 F.2d 1388, 1392 (9th Cir. 1988); and (5) no person has filed a 4 claim, or the claim(s) have been resolved under 18 U.S.C. § 983(a)(4)(A) or Supp. R. G(5). 5 Civil cases that do not directly address forfeiture have seven factors that the Court 6 must consider before entry of default: (1) the substantive merit of the plaintiff’s claims; (2) 7 the sufficiency of the complaint; (3) the amount of money at stake; (4) the possibility of 8 prejudice to the plaintiff if relief is denied; (5) the possibility of disputes to any material 9 facts in the case; (6) whether default resulted from excusable neglect; and (7) the public 10 policy favoring resolution of cases on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-72 11 (9th Cir. 1986); SATA GmbH & Co. KG v. USA Italco Int'l Ltd., No. 3:18-CV-00351-MMD- 12 WGC, 2019 WL 4601513, at *3 (D. Nev. Sept. 20, 2019); Covenant Care California, LLC v. 13 Shirk, No. 217CV00956JADVCF, 2018 WL 3429669, at *1 (D. Nev. July 16, 2018). 14 For purposes of a default judgment, the well-pled allegations of a complaint are 15 taken as true. Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 918 (9th Cir. 1987). 16 Furthermore, upon default, the defendant’s liability is conclusively established and the 17 factual allegations in the complaint, except those relating to damages, are accepted as true. 18 Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977). The power to grant or deny 19 relief upon an application for default judgment is within the discretion of the Court. Aldabe 20 v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). 21 B. The Forfeiture Requirements for Default Were Met. 22 a. Judgment Sought 23 Pursuant to Fed. R. Civ. P. 54(c) and 55(b), the judgment by default does not “differ 24 in kind from, or exceed [the] amount” of relief listed in the Complaint for forfeiture. 25 b. Default and Entry of Default 26 As shown above, the United States requested entry of Clerk’s Default against the 27 $10,000 in United States Currency, Jamal (Jamel) Ellzey, Tanisha Hanson, Anthony 28 Wadley, and all persons or entities who may claim an interest in the defendant property in 1 the above-entitled action. ECF No. 10. The Clerk entered the Default as requested. ECF 2 No. 11. 3 c. Notice 4 Pursuant to Fed. R. Civ. P. Supp. Rule G(4)(a)(iv)(C), the United States published 5 notice via the official internet government forfeiture site, www.forfeiture.gov, for thirty 6 consecutive days. ECF No. 7. Pursuant to Fed. R. Civ. P. Supp. Rule G(4)(b), the United 7 States served the Complaint, the Order for Summons and Warrant of Arrest in Rem for the 8 Property and Notice, the Summons and Warrant of Arrest in Rem for the Property, and the 9 Notice of Complaint for Forfeiture and Arrest on all known potential claimants. ECF Nos. 10 8 and 9. 11 d. Legal Sufficiency of the Complaint 12 The Complaint filed in this action was verified. The Court has subject matter 13 jurisdiction, in rem jurisdiction over the defendant property, and venue. The Complaint 14 described the property with reasonable particularity. The Complaint stated where the 15 seizure of the defendant property occurred and its current location. The Complaint 16 identified the statute under which the forfeiture action has been brought. The Complaint 17 alleged sufficiently detailed facts to support a reasonable belief that the United States would 18 be able to meet its burden of proof at trial. Supp. R. G(2); ECF No. 1. 19 e. Status of Potential Claimants 20 No person or entity has filed a claim and the time to file a claim has passed. 21 C. The Civil Requirements for Default Were Met. 22 a. The Plaintiff Would be Prejudiced Without a Judgment 23 The government would be prejudiced if it were to try this case rather than obtain a 24 default judgment, since a trial would require the additional expenditure of human and 25 financial resources. These expenses and efforts are unnecessary because the Complaint 26 established sufficient evidence of the status and forfeitability of the defendant property, and 27 that evidence is uncontested by Jamal (Jamel) Ellzey, Tanisha Hanson, Anthony Wadley. 28 See United States v. $150,990.00 in U.S. Currency, No. 2-12-CV-01014-JAD, 2014 WL 1 6065815, at *2 (D. Nev. Nov. 10, 2014), (“[T]he government would be prejudiced by 2 having to expend additional resources litigating an action that appears to be uncontested. 3 This factor favors default judgment.”). 4 b. & c. The Plaintiff’s Claims are Meritorious and the Complaint is 5 Sufficient. 6 As shown in the statement of the case above, the government has a bona fide case 7 against the defendant property and the Complaint sufficiently alleges the facts of the case. 8 d. The Amount of Money at Stake 9 The value of the defendant property was clearly established in the Complaint, ECF 10 No. 1, and the defendant property is forfeitable pursuant to 21 U.S.C. § 881(a)(6).

11 Under the fourth Eitel factor, the court considers the amount of money at stake in relation to the seriousness of Defendants' conduct. Plaintiff has provided 12 evidence that the currency, a sum of $24,000, was furnished or intended to be furnished in exchange for marijuana, a serious violation of federal law. 13 United States v. Twenty-Four Thousand Dollars ($24,000) in U.S. Currency, No. 14 02:09-CV-2319-LRH, 2010 WL 2695637, at *3 (D. Nev. July 2, 2010) (quotation marks and citation omitted). 15 16 The Complaint alleges the serious crime of exchanging or intending to exchange moneys, 17 negotiable instruments, securities, or other things of value for a controlled substance or 18 listed chemical in violation of Subchapter I of the Controlled Substances Act, 21 U.S.C. § 19 801, et seq. The money at stake is the tainted currency related to a completed or 20 contemplated illegal-drugs transaction in violation of Subchapter I of the Controlled 21 Substances Act, 21 U.S.C. § 801, et seq., and proceeds traceable to the violations. 22 e. There Are No Possible Disputes of Material Fact 23 No issues of material fact exist, and the allegations of the Complaint are established 24 as a matter of law. The property is subject to forfeiture because law enforcement can 25 demonstrate that the defendant property: 26 a. is all moneys, negotiable instruments, securities, or other things of 27 value furnished or intended to be furnished in exchange for a 28 controlled substance or listed chemical in violation of Subchapter I of 1 the Controlled Substances Act, 21 U.S.C. § 801, et seq., and is subject 2 to forfeiture to the United States pursuant to 21 U.S.C. § 881(a)(6). 3 b. is all proceeds traceable to an exchange for a controlled substance or 4 listed chemical in violation of Subchapter I of the Controlled 5 Substances Act, 21 U.S.C. § 801, et seq., and is subject to forfeiture to 6 the United States pursuant to 21 U.S.C. § 881(a)(6). 7 c. is all moneys, negotiable instruments, and securities used or intended 8 to be used to facilitate violations of Subchapter I of the Controlled 9 Substances Act, 21 U.S.C. § 801, et seq., and is subject to forfeiture to 10 the United States pursuant to 21 U.S.C. § 881(a)(6). 11 d. is any property, real or personal, which constitutes or is derived from 12 proceeds traceable to a violation of Subchapter I of the Controlled 13 Substances Act, 21 U.S.C. § 801, et seq., a specified unlawful activity 14 as defined in 18 U.S.C. §§ 1956(c)(7)(A) and 1961(1)(D), or a 15 conspiracy to commit such offense, and is subject to forfeiture to the 16 United States pursuant to 18 U.S.C. § 981(a)(1)(C) 17 f. Default Was Not the Result of Excusable Neglect 18 The record shows that the claimant and potential claimants were properly served 19 with the Complaint, Order, Summons and Warrant, and the Notice and failed to file a 20 claim and answer to the Complaint. There is no evidence of excusable neglect. 21 g. Public Policy Does not Prevent Default Judgment 22 Under Fed. R. Civ. P. 55(b), default judgments are allowed. Here, the potential 23 claimants did not file a claim and an answer to the government’s Complaint.

24 While the Federal Rules do favor decisions on the merits, they also frequently permit termination of cases before the court reaches the merits. As F.R.C.P. 55 25 indicates, one such instance is when a party fails to defend against an action, which is exactly what [claimant(s)] failed to do in this case. Thus, the preference 26 to decide cases on the merits does not preclude a court from granting default judgment. 27 Kloepping v. Fireman's Fund, No. C 94-2684 TEH, 1996 WL 75314, at *3 (N.D. 28 Cal. Feb. 13, 1996). 1 Denying the government’s motion would not further public policy. While cases should be 2 decided on the merits when possible, the potential claimants have not contested the facts of 3 the Complaint or the forfeiture of the defendant property, which makes a decision on the 4 merits impractical. Therefore, a final default judgment of forfeiture is appropriate. See 5 Covenant Care California, 2018 WL 3429669, at *2. 6 IV. Judgment 7 Based on the foregoing this Court finds that the United States has shown its 8 entitlement to a Default Judgment of Forfeiture as to Jamal (Jamel) Ellzey, Tanisha 9 Hanson, Anthony Wadley, and all persons or entities who may claim an interest in the 10 defendant property and Final Judgment of Forfeiture as to $10,000 in United States 11 Currency. 12 NOW, THEREFORE, IT IS HEREBY ORDERED, ADJUDGED, AND 13 DECREED that Default Judgment of Forfeiture is entered against Jamal (Jamel) Ellzey, 14 Tanisha Hanson, Anthony Wadley, and all persons or entities who may claim an interest 15 in the defendant property in the above-entitled action. 16 IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Final 17 Judgment of Forfeiture is entered against the $10,000 in United States Currency. 18 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the defendant 19 property be, and the same is hereby forfeited to the United States of America, and no 20 possessory rights, ownership rights, and no rights, titles, or interests in the property shall 21 exist in any other party. 22 IT IS HEREBY CERTIFIED, pursuant to 28 U.S.C. § 2465(a)(2), that there was 23 reasonable cause for the seizure or arrest of the defendant property. 24 Dated this _2_ day of July, 2021. 25 26 _________________________________ Gloria M. Navarro, District Judge 27 United States District Court