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U.S. v. BENNETT

April 14, 2004.

UNITED STATES OF AMERICA -against- PATRICK BENNETT, Defendant; and GWEN BENNETT, and ANDRICK IRREVOCABLE TRUST, Third-Party Claimants


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

OPINION AND ORDER

On October 20, 2003, Patrick Bennett, appearing pro se, moved for: (i) mandatory Judicial Notice pursuant to Federal Rule of Evidence 201(d); (ii) a hearing on the issue of whether the Government fulfilled its obligation to recover proceeds from his crimes before it attempted to forfeit substitute assets; and (iii) appointment of counsel to represent him in the aforementioned motions. On November 3, 2003, Bennett wrote a letter to the Court, seeking to: (i) vacate Judge Martin's Amended Opinion and Order dated October 10, 2003; and (ii) vacate the Forfeiture Order pursuant to Rule 59(e). Bennett also requested that the Court rule on his August 23, 2003 motion to recuse Judge Martin, and Bennett's judicial notice motion. See Government's Memorandum in Opposition to Patrick Bennett's Various Motions ("Gov't Mem.") at 6. This opinion addresses each of these motions.

 I. BACKGROUND*fn1

  A. Patrick Bennett's Conviction and Sentencing

  In 1997, Patrick Bennett was charged with criminal activity arising from a massive fraud and money laundering scheme involving the Bennett Funding Group, an office equipment leasing company run primarily by Bennett and the Bennett Management and Development Corporation. See Gov't Mem. at 2.

  In March, 1999, a jury found Bennett guilty of two counts of conspiracy to obstruct justice and commit perjury, one count of obstruction of justice, and four counts of perjury. The jury failed to reach a verdict on remaining counts. On June 10, 1999, after a retrial before Judge Martin, a jury convicted Bennett of two counts of securities fraud, five counts of bank fraud, thirty counts of money laundering, and five counts of engaging in monetary transactions with criminally derived property. The jury also returned a special verdict requiring Bennett to forfeit $109,088,889.11. See id. at 2-3.

  On January 28, 2000, Judge Martin held a sentencing hearing concerning Bennett's assets. On April 28, 2000, Judge Martin sentenced Bennett to 30 years of imprisonment followed by three years of supervised release, and ordered him to forfeit $109,088,889.11 (the "Forfeiture").*fn2 Id.

  B. Forfeiture Proceedings

  On October 6, 2000, Judge Martin entered a First Amended Order of Forfeiture against Bennett (the "Forfeiture Order"). The Order found that Bennett had an ownership interest in two properties held in the name of Gwen Bennett, Bennett's wife, and one property held in the name of the Andrick Irrevocable Trust (the "Properties"). The Forfeiture Order vested all of Bennett's rights to the Properties in the United States of America and, pursuant to 18 U.S.C. § 982(b)(1), authorized the recovery of any substitute assets necessary to complete the forfeiture. The Forfeiture Order further provided that the court would enter a final order of forfeiture pursuant to 21 U.S.C. § 853(n) "[u]pon adjudication of all third-party interests." Gov't Mem. at 3-4, citing the Forfeiture Order at 5. Bennett and Gwen Bennett opposed entry of the Forfeiture Order, raising some of the same points addressed here. Judge Martin rejected each of their arguments. See United States v. Bennett, No. 97 CR 639, 2000 WL 1505986, at *2 (S.D.N.Y. Oct. 6, 2000).

  C. Bennett's Appeals

  In 2000, Bennett appealed both his judgment of conviction and the Forfeiture Order. On February 12, 2001, however, Bennett withdrew his appeal of the Forfeiture Order and stipulated that the appeal would be deemed "withdrawn with prejudice" should he fail to reinstate it within thirty days. Bennett did not reinstate that appeal. See Gov't Mem. at 4-5.

  Bennett filed another appeal in 2002, again challenging his conviction, his sentence, and the Forfeiture Order. Bennett asserted, among other things, that the Forfeiture Order improperly authorized the recovery of substitute assets because the Government did not first attempt to forfeit the actual fruits of the crimes of which he was convicted. The Court of Appeals affirmed Bennett's conviction and sentence, and rejected each of his challenges to the Forfeiture Order. See United States v. Bennett, No. 02-1379 (2d Cir. Sept. 19, 2003), slip op. at 4. Although Bennett sought appellate review of this decision, on January 12, 2004, the Supreme Court denied his petition for certiorari. See Bennett v. United States, — U.S. —, 124 S.Ct. 1112, No. 03-7654 (2004).

  D. The Ancillary Proceeding

  On November 9, 2000, Gwen Bennett filed a Notice of Petition for a hearing pursuant to 21 U.S.C. § 853(n)(2), contending that she had a financial interest in the Properties. On February 6, 2001, Wanda Koen, Trustee for the Andrick Irrevocable Trust, served a Notice of Petition pursuant to 21 U.S.C. § 853(n), claiming that she also had an interest in one of the Properties. On August 14 and 18, Judge Martin conducted an ancillary hearing with respect to these third-party claims (the "Ancillary Proceeding"). On September 24, 2003, Judge Martin issued an Opinion and Order dismissing each claim. Though Gwen Bennett subsequently filed additional motions in the Ancillary Proceeding pursuant to Rule 59 and 60 of the Federal Rules of Civil Procedure, ...


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