United States District Court, W.D. New York
DECISION AND ORDER
HONORABLE RICHARD J. ARCARA JUDGE.
defendant, Jack Reid, was convicted after a jury trial of one
count of conspiracy to possess with intent to distribute and
to distribute five kilograms or more of cocaine in violation
of 21 U.S.C. § 846, and one count of possession with
intent to distribute and distribution of cocaine in violation
of 21 U.S.C. § 841(a)(1). The Superseding Indictment
returned by the grand jury that charged the offenses includes
forfeiture allegations pursuant to 21 U.S.C. §§
853(a)(1) and (a)(2) to give defendant Reid notice of certain
property alleged to be subject to forfeiture as proceeds of
the offenses and as property that facilitated the offenses.
the United States filed a motion for a preliminary order of
forfeiture, the Court convened a forfeiture hearing, the
parties have filed extensive submissions, and the Court heard
oral argument. The United States has voluntarily narrowed its
earlier notice and motion for a preliminary order of
forfeiture to seek forfeiture of: (1) a parcel of real
property at 58 The Common, Williamsville, New York; (2) a
second parcel of real property at 23 Sunrise Boulevard,
Amherst, New York; and (3) an additional one million dollars
in United States currency to be reflected in a money judgment
against defendant Reid. Upon consideration of the submissions
and arguments of the parties, the evidence during the
criminal trial, and the evidence during the forfeiture
hearing, and for the reasons stated below, the Court grants
the United States' motion for a preliminary order of
forfeiture and is ordering that defendant's right title
and interest in the two parcels of real property, and the
amount of one million dollars of United States currency,
shall be forfeited to the United States pursuant to 21 U.S.C.
§ 853(a)(2) as property that facilitated commission of
the conspiracy offense of conviction.
21 U.S.C. § 853(a)(2) provides that a defendant
convicted of a felony narcotics offense “shall forfeit
. . . any of the person's property used, or intended to
be used, in any manner or part, to commit, or to facilitate
the commission of . . . the offense. This provision is to
“. . . be liberally construed to effectuate [its]
remedial purposes.” 21 U.S.C. § 853(o).
procedures applicable to forfeiture determinations are stated
in Fed.R. Crim.P. 32.2. When the United States seeks
forfeiture of specific property, as it does in this case,
“the court must determine whether the government has
established the requisite nexus between the property and the
offense.” Fed.R.Crim.P. 32.2(b)(1)(A). For a personal
money judgment, “the court must [also] determine the
amount of money that the defendant will be ordered to
United States bears the burden of proof to establish that the
property at issue is subject to forfeiture by the standard of
a preponderance of the evidence. See United States v.
Capoccia, 503 F.3d 103, 116 (2d Cir. 2007). If the Court
concludes that property is subject to forfeiture, the Court
enters a preliminary order of forfeiture in the amount of a
money judgment and directing forfeiture of any specific
property without regard to any third-party interests, which
are determined in an ancillary proceeding under Rule 32.2(c).
See Fed.R.Crim.P. 32.2(b)(2)(A).
Judgment. When determining an amount of currency to be
forfeited, the Court may “use general points of
reference as a starting point” for the calculation and
“make reasonable extrapolations” supported by a
preponderance of the evidence. United States v.
Treacy, 639 F.3d 32, 48 (2d Cir. 2011). In this case,
evidence during the trial and the forfeiture hearing
established by a preponderance of the evidence that
approximately six (6) kilograms of cocaine were obtained in
Rochester, New York; approximately 20 (twenty) additional
kilograms were obtained from New York City beginning in late
2010 through 2011; and, approximately 40 (forty) additional
kilograms were obtained from the Atlanta, Georgia, area from
about June, 2011 until April, 2012. The Court therefore
determined that the cocaine-trafficking conspiracy in
violation of 21 U.S.C. § 846 of which defendant Reid was
convicted involved approximately 66 kilograms of cocaine.
the price per kilogram that the defendant Reid paid for
cocaine varied depending on the source, and presumably on
market conditions, the Court estimates for present purposes
based primarily upon the testimony of Elliot Walker and
Ronald Douglas that the approximate cost per kilogram was
$30, 000 during the approximate three-year period from 2009
through early 2012 during which the 66 kilograms of cocaine
were purchased by the defendant and his co-conspirators for
resale. Accordingly, the Court estimates and finds defendant
Reid spent approximately $1.9 million to purchase cocaine for
resale during the criminal conspiracy of which he stands
convicted. As the purchase price of cocaine sold within the
scope of the conspiracy offense, that sum of $1.9 million was
used to facilitate the offense, and that money had a
sufficient nexus to the conspiracy offense to support entry
of a money judgment in the one-million-dollars amount sought
by the United States. See e.g., United States v.
Crews, 885 F.Supp.2d 791, 793-94 (E.D.Pa. 2012)
aff'd U.S. v. Miller, 645 Fed.Appx. 211, 225-28
(3d Cir. 2016); United States v. Harrison, 2001 WL
803695, *1-2 (N.D. Ill. 2001).
Commons. During the trial and the forfeiture hearing, it was
well established that substantial activities during the
cocaine-trafficking conspiracy in violation of 21 U.S.C.
§ 846 occurred at 58 The Commons, Williamsville, New
York. The premises at 58 The Common have a value of
approximately $225, 000.
Walker credibly testified that he delivered cocaine-sale
proceeds to the premises at 58 The Commons approximately
twice a month for a period of years. Ronald Douglas testified
credibly that he and defendant Reid counted and
vacuumed-sealed large sums of currency at 58 The Commons so
that Ronald Douglas could drive the currency to Atlanta to be
used to purchase multiple- kilogram-quantities of cocaine for
approximately $30, 000 per kilogram approximately nine times.
Dkt. No. 165, pp. 39-58. Morgan Lewis recorded a conversation
with the defendant at 58 The Commons in January of 2012
during which the defendant spoke about paying Lewis $1, 000
per trip four of five times a month to pick up drugs to bring
back to Buffalo. Dkt. No. 157, pp. 54-56. More than any other
location, 59 The Commons was where money to be used to
purchase cocaine and cocaine-sales proceeds changed hands
among defendant Reid and his coconspirators.
Court finds the evidence also establishes by a preponderance
of the evidence that the premises at 58 The Common were used
to plan, carry out, prepare for the acquisition of cocaine
for further distribution, as well as to collect proceeds from
cocaine distribution where the proceeds were accounted for
and vacuum-sealed for future purchases. Defendant Reid's
use of the premises to arrange, prepare for, and carry out
purchases and sales of cocaine, and to exchange money used to
buy cocaine and proceeds of cocaine with co-conspirators
facilitated under § 853(a)(2) the cocaine-trafficking
conspiracy offense, and the premises had a substantial nexus
to the conspiracy offense sufficient to warrant their
forfeiture. The premises were used to facilitate a serious
cocaine-trafficking conspiracy offense carrying a maximum
punishment of life imprisonment and a fine of $20, 000, 000.
Sunrise Blvd. Defendant Reid also used premises at 23 Sunrise
Boulevard, Amherst, New York to facilitate the
cocaine-trafficking conspiracy. Elliot Walker credibly
testified that the defendant referred to 23 Sunrise Blvd. by
a code phrase, “by the Cadillac dealer, ” and
that Walker delivered cocaine-trafficking proceeds to the
defendant when the defendant was present at 23 Sunrise Blvd.
Carl Russo met the defendant and Walker on March 26, 2012, at
23 Sunrise Blvd. to negotiate the purchase a half-kilogram of
cocaine for $20, 000. Walker corroborated Russo's
testimony about the negotiations at 23 Sunrise Blvd. As a
result of the meeting, cocaine was “fronted” to
Russo, and Russo met the defendant in 23 Sunrise Blvd. a few
days later, and made a partial payment for the cocaine of $7,
500. The evidence shows that the premises at 58 The Common
were used by defendant Reid much more to facilitate the
criminal conspiracy, but the circumstances also establish the
premises at 23 Sunrise Blvd. were used by the defendant to
receive proceeds of cocaine-trafficking and to arrange
cocaine-trafficking during the course of the conspiracy of
which the defendant stands convicted. As such, the premises
were substantially connected to the conspiracy, and the nexus
to the cocaine conspiracy is substantial enough to warrant
forfeiture of the defendant's ownership in the premises.
premises at 23 Sunrise Boulevard have a value of
approximately $110, 000. Even when combined with the value of
the premises at 58 The Commons to be forfeited, and the money
judgment for one million dollars, the forfeitures are not
grossly disproportionate to the serious harms caused by
defendant Reid's long-running cocaine-trafficking
conspiracy involving approximately 66 ...