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United States v. Contents of Two Shipping Containers Seized at Elizabeth

August 8, 2005

UNITED STATES OF AMERICA PLAINTIFF,
v.
CONTENTS OF TWO SHIPPING CONTAINERS SEIZED AT ELIZABETH, NEW JERSEY, ON OR ABOUT DECEMBER 10, 1990, INCLUDING ONE 1990 NISSAN 300ZX (VIN JN1RZ26A3LX010643) AND VARIOUS ITEMS OF FURNITURE AND PERSONAL EFFECTS, DEFENDANTS.



The opinion of the court was delivered by: Walls, District Judge

OPINION

The United States moves for summary judgment in the civil forfeiture action of the contents of two shipping containers seized in Elizabeth, New Jersey on or about December 10, 1990, including one 1990 Nissan 300ZX (VIN JN1RZ26A3LX010643), and various items of furniture and personal effects. Claimant Daniel Oriakhi, pro se, a/k/a Smith Adoga, a/k/a Adoga Smith, opposes the motion. For the reasons stated, the motion for summary judgment is granted.

FACTS AND PROCEDURAL BACKGROUND

This case deals with property seized from Mr. Oriakhi during the course of a criminal investigation and his arrest for narcotics and currency violations. From late 1988 through April 1990, two large scale heroin distribution organizations - run by Robert Dowdy and Linwood Williams - operated in the Baltimore, Maryland area. United States v. Oriakhi, 57 F.3d 1290, 1293 (4th Cir. 1995). Mr. Oriakhi and his partners supplied these groups with heroin. Id. Government agents observed Mr. Oriakhi deliver heroin and large amounts of currency to various individuals. Id. When Mr. Dowdy was arrested, he agreed to cooperate with the government's investigation. Id. Mr. Oriakhi fled to Nigeria, but was indicted in absentia. Id.

Mr. Oriakhi returned to the United States in the summer of 1990, and traveled with a passport in the name of Adoga Smith. Id. On December 10, 1990, the United States Customs Service ("Customs") seized the contents of two shipping containers bound for Nigeria in Elizabeth, New Jersey, including one 1990 Nissan 300ZX (VIN JN1RZ26A3LX010643), and various items of furniture and personal effects. Id. at 1294. According to the government, the shipping receipts gave vague information and omitted any identification of a shipper or consignee. Id. Many of the items were labeled "Adoga Smith Company." Id. Customs agents typically examine unusual shipments: (1) bound for narcotic source countries; (2) bound for countries subject to embargo; or (3) accompanied by incomplete or suspicious paperwork. Id.

On December 13, 1990, Customs agents at John F. Kennedy International Airport found two guns and ammunition from an x-ray examination of luggage belonging to Adoga Smith on a flight bound for Switzerland. See United States v. $97,253 in U.S. Currency, No. 95-CV-3982, 2000 WL 194683, at *1 (E.D.N.Y. Feb. 15, 2000), aff'd, United States v. Oriakhi, No. 00-6135 (2d Cir. May 3, 2001). They opened other luggage belonging to Adoga Smith, and found $10,000 in $100 bills. Id. The Customs agents requested that Adoga Smith disembark from the airplane for questioning. Id. They informed Adoga Smith of the currency reporting requirements, and Adoga Smith stated he was carrying approximately $2,000. Id. He signed a Customs form using the name Smith Adoga and, after informing him of his Constitutional rights, the agents conducted a search. Id. The Customs agents discovered a total of $97,253 in United States currency concealed in Adoga Smith's luggage and hidden within his clothing. Id.

In February 1991, Mr. Oriakhi, using the name Adoga Smith, pleaded guilty in the United States District Court for the Eastern District of New York to a violation of 31 U.S.C. § 5316 for failing to file a report when transporting more than $10,000 in United States currency outside the United States. $97,253 in U.S. Currency, 2000 WL 194683, at *4. After this arrest, government authorities in Maryland learned that Mr. Oriakhi was, in fact, the same person as Adoga Smith. Mr. Oriakhi was sent to Maryland, where a federal grand jury re-indicted him. Oriakhi, 57 F.3d at 1295. Some of the items seized in Elizabeth, New Jersey were used as evidence against Mr. Oriakhi at trial. Id. at 1294. In December 1992, a jury in the United States District Court for the District of Maryland convicted Mr. Oriakhi of conspiracy to distribute heroin and possession with intent to distribute heroin on two separate occasions. Id. at 1295. Mr. Oriakhi was sentenced to a term of 300 months imprisonment, and the Fourth Circuit affirmed his conviction. Id. at 1293.

On September 29, 1995, the government commenced an in rem civil action in the United States District Court for the Eastern District of New York to forfeit the $97,253 in United States currency seized from Mr. Oriakhi at the airport and the contents of the two shipping containers seized in Elizabeth, New Jersey. On February 11, 1997, the court granted the government's motion to transfer the portion of Mr. Oriakhi's action requesting compensation for the property seized in New Jersey to this district and, on February 14, 1997, Mr. Oriakhi filed that complaint in this Court (Civ. No. 97-0729).

The matter now before the Court relates to the civil forfeiture proceeding of the contents of the two shipping containers seized in Elizabeth, New Jersey. On May 10, 1991, the Drug Enforcement Agency ("DEA") effected the forfeiture of the Nissan 300ZX; on August 8, 1991, Customs officials effected an administrative forfeiture of the remaining contents of the two shipping containers. Mr. Oriakhi sought to vacate the administrative forfeitures of these items because the government failed to provide adequate notice. In an order dated August 4, 1999, this Court vacated the administrative forfeitures because there was inadequate notice, and ordered the government to commence judicial forfeiture proceedings. Mr. Oriakhi appealed and, on October 1, 2001, the Third Circuit affirmed this Court's order. On December 14, 2001, the government filed its complaint for judicial forfeiture of the contents of the two shipping containers seized in Elizabeth, New Jersey. On January 30, 2002, the government moved for summary judgment and a final order of forfeiture.

STANDARD FOR SUMMARY JUDGMENT

Summary judgment is appropriate where the moving party establishes that "there is no genuine issue as to any material fact and that [it] is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). A factual dispute between the parties will not defeat a motion for summary judgment unless it is both genuine and material. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 2510, 91 L.Ed. 2d 202 (1986). A factual dispute is genuine if a reasonable jury could return a verdict for the non-movant and it is material if, under the substantive law, it would affect the outcome of the suit. Id. at 248, 106 S.Ct. at 2510. The moving party must show that if the evidentiary material of record were reduced to admissible evidence in court, it would be insufficient to permit the non-moving party to carry its burden of proof. See Celotex v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552, 91 L.Ed. 2d 265 (1986).

Once the moving party has carried its burden under Rule 56, "its opponent must do more than simply show that there is some metaphysical doubt as to the material facts in question." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356, 89 L.Ed. 2d 538 (1986). The opposing party must set forth specific facts showing a genuine issue for trial and may not rest upon the mere allegations or denials of its pleadings. See Sound Ship Building Co. v. Bethlehem Steel Co., 533 F.2d 96, 99 (3d Cir. 1976), cert. denied, 429 U.S. 860 (1976). At the summary judgment stage the court's function is not to weigh the evidence and determine the truth of the matter, but rather to determine whether there is a genuine issue for trial. See Anderson, 477 U.S. at 249, 106 S.Ct. at 2510. In doing so, the court must construe the facts and inferences in the light most favorable to the non-moving party. See Wahl v. Rexnord, Inc. 624 F.2d 1169, 1181 (3d Cir. 1980).

In a judicial forfeiture proceeding, the government must demonstrate that probable cause existed for the seizure of the property. United States v. $55,518.05 in U.S. Currency, 728 F.2d 192, 195 (3d Cir. 1984) (citations omitted). "Once the government establishes probable cause the burden of proof shifts to the defendant to show that the property was not to be used for this purpose." Id. at 196. In United States v. $10,700 in U.S. Currency, 258 F.3d 215 (3d Cir. 2001), the Third Circuit said:

Three elements must be present in order to subject a claimant's property to civil forfeiture pursuant to 21 U.S.C. § 881(a)(6): (1) the subject property must be moneys, negotiable instruments, securities, or other things of value; (2) there must be probable cause to believe that there exists illicit drug activity that renders the seized property subject to forfeiture; and (3) there must be probable cause to believe that a connection, or nexus, exists between the seized property and the predicate drug activity the government has identified.

$10,700 in U.S. Currency, 258 F.3d at 222 (citations and footnotes omitted).

DISCUSSION

A. The Doctrine of Collateral Estoppel Bars Mr. Oriakhi from Relitigating the Source of the Fund Used to Purchase the Items Contained in the Two Shipping Containers

To defeat summary judgment, Mr. Oriakhi must set forth evidence that the contents of the two shipping containers are not subject to forfeiture. Mr. Oriakhi argues "Claimant purchased the properties with revenue from hard-earned years of working, which source was verified and authenticated by claimants' [sic] former attorney." Oriakhi Br. at 13. However, the doctrine of collateral estoppel, or issue preclusion, prevents Mr. Oriakhi from arguing that the funds used ...


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