US v. Browns

2007 DNH 054

Opinion

US v . Browns 06-CR-071-SM 04/18/07 UNITED STATES DISTRICT COURT DISTRICT OF NEW HAMPSHIRE

United States of America, Government

v. Criminal N o . 06-cr-71-1,2-SM Opinion N o . 2007 DNH 054 Elaine A . Brown and Edward L . Brown, Defendants

O R D E R (Ancillary Proceeding)

The State of New Hampshire has filed a petition for

ancillary proceedings to determine its rights to property owned

by the defendants and subject to partial federal criminal

forfeiture. Fed. R. C r . P. 32.2 The government has not

responded.

Counsel to the government and State shall confer and file

either a joint stipulation as to the priority of their respective

rights to the forfeited property, o r , failing agreement, the

parties shall file motions for summary judgment, supported by

legal memoranda, setting forth their respective priority claims

and the bases upon which they claim superiority. The material

facts appear to be undisputed and priority ought to be resolvable as a matter of law. The stipulation or motions shall be filed on

or before Monday, April 2 3 , 2007.

The court notes that defendants’ real estate is subject to

partial criminal forfeiture to the following extent: $42,840.16

of the value of 27 Glen Road, West Lebanon, New Hampshire, and

$27,997.13 of the value of 401 Center of Town Road, Plainfield,

New Hampshire. Ownership of the real estate, beyond what the

government acquires through forfeiture, seemingly will remain

with defendants, albeit subject to the usual liens and

encumbrances of record. See, e.g., United States v . Serendensky,

393 F.3d 348 (2d Cir. 2004). A money judgment against defendants

in the amount of $215,890.47 (representing the forfeited money

orders whose proceeds are not traceable to the identified real

estate) will also be entered in favor of the government, giving

the government the same collection rights with respect to that

amount as a plaintiff in a civil case. United States v . Hall,

434 F.3d 4 2 , 59 (1st Cir. 2006). And, the government can be

expected to pursue civil remedies to recover all back federal

taxes, interest, and penalties owed by defendants.

The State’s interest in the residential and commercial

property appears to arise from a state tax lien dated August 2 9 ,

2 2006, in the amount of $342,844.68, representing unpaid state

business taxes assessed against D r . Brown and owed for tax years

1999-2002. The State’s lien was amended as of December 2 9 , 2006,

presumably to add accumulating interest, for a total current lien

amount of $348,235.32. The State’s lien appears to have been

recorded in the appropriate land records.

Given that the government’s title to the property to be

forfeited is limited in degree and relates back to the date when

the criminal conduct was committed, it may be that there is no

priority dispute, at least not with respect to the government’s

claim of entitlement. See 21 U.S.C. § 853(n); United States v .

McClung, 6 F.Supp. 2d 5 4 8 , 600-01 (W.D. V a . 1998). And, there

may be sufficient equity in the property to satisfy both claims,

making the State’s claim unnecessary. In any event, a hearing

does not appear to be required since the material facts do not

appear to be subject to reasonable dispute.

Conclusion

The State and government shall file either a stipulation

regarding the priority of their respective rights in the

partially forfeited property, or cross-motions for summary

3 judgment with respect to priority, on or before Monday, April 2 3 ,

2007.

SO ORDERED.

Steven J. McAuliffe 'Chief Judge April 1 8 , 2007

cc: Robert J. Rabuck, Esq. William E . Morse, Esq. Glenn A . Perlow, Esq. Elaine A . Brown, pro se Edward L. Brown, pro se U.S. Marshal U.S. Probation