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United States v. Maritime Life Caribbean Ltd.

United States Court of Appeals, Eleventh Circuit

January 16, 2019


          Appeal from the United States District Court for the Southern District of Florida, D.C. Docket No. 1:05-cr-20859-PCH

          Before WILLIAM PRYOR and MARTIN, Circuit Judges, and WOOD, [*] District Judge.

          WILLIAM PRYOR, Circuit Judge:

         This appeal involves two questions about an ancillary third-party forfeiture proceeding in which Maritime Life Caribbean asserted that it was given a security interest in the forfeited property: whether the district court erred in requiring Maritime Life to prove the authenticity of the collateral assignment that allegedly granted it a security interest in the forfeited property by a preponderance of the evidence, and whether the district court erred in permitting the Republic of Trinidad and Tobago to intervene in the forfeiture proceeding even though it had no legal interest in the property. We conclude that, although both rulings were in error, neither error warrants reversal. We affirm.

         I. BACKGROUND

         Raul Gutierrez pleaded guilty in 2006 to a variety of wire- and bank-fraud charges arising from a bid-rigging scheme involving the construction of an airport in Trinidad and Tobago. After sentencing, the district court entered a preliminary order of forfeiture against him in the amount of $22, 556, 100, representing the proceeds of his criminal activity. The forfeiture included Gutierrez's interest in a piece of real property located at 12850 Red Road in Coral Cables, Florida, the title for which was held by Inversiones Rapidven, S.A. Although the plea agreement exhaustively listed Gutierrez's assets and liabilities, it did not mention any encumbrance on the Red Road property.

         The Republic of Trinidad and Tobago moved to intervene in the forfeiture proceeding under Federal Rule of Criminal Procedure 32.2. Trinidad asserted that it was a victim of the bid-rigging conspiracy and that it had an interest in any forfeiture proceeds that might result from the sale of the Red Road property, but it did not assert any legal interest in the property itself. The district court expressed skepticism about the propriety of permitting Trinidad to intervene and acknowledged that it was "not sure if [Trinidad has] standing" under the statute governing criminal forfeitures, 21 U.S.C. § 853. Despite these misgivings, the district court granted Trinidad's motion to intervene. It directed Trinidad and the government to "form a committee on the government[/]victim side and decide who will be speaking for that group."

         At a later status conference, the government expressed concern over a "potential conflict" between the parties' interests and argued that victims like Trinidad do not "have standing in a forfeiture proceeding." The district court disregarded this concern on the ground that the government was "going to get a lot of cooperation from the lawyers for [Trinidad]" and Trinidad probably would end up "carrying the laboring oar . . . from this point forward." In the district court's view, Trinidad's intervention was permissible because it was the party who was "going to benefit if the government wins on the forfeiture."

         In 2010, the district court instructed the government to issue a Notice of Criminal Forfeiture addressed to Steve Ferguson, the former chief executive officer of Maritime Life. Ferguson and Gutierrez were longtime business associates and friends, and both were implicated in the criminal charges underlying the forfeiture proceeding. Maritime responded to the notice by filing a third-party claim asserting an interest in the Red Road property under the criminal-forfeiture statute, 21 U.S.C. § 853(n), and Rule 32.2(c). To support its claim, Maritime produced an alleged collateral assignment that purported to memorialize a transaction in which Gutierrez granted a security interest in the Red Road property to Maritime as collateral for a $2 million loan to Keystone Property Developers, Ltd., Gutierrez's construction company. The alleged assignment is dated July 24, 2001 and was signed by Gutierrez in his capacity as president of Calmaquip Engineering Corporation, but it was never recorded.

         The government and Trinidad opposed Maritime's claim. The parties then engaged in protracted discovery in which Trinidad played a significant role, leading 14 depositions on behalf of the government. Maritime objected to Trinidad's participation in the litigation, but the district court denied its motion. The district court acknowledged that Trinidad "does not have a direct claim under [section] 853 or under the forfeiture claim" but permitted Trinidad to proceed, "not in [its] own rights, but . . . to do the work on behalf of the government."

         After discovery, Trinidad and the government jointly moved for summary judgment, but the district court denied that motion. Instead, it sua sponte decided to hold a bifurcated trial with an initial phase focused solely on the question whether "to admit the collateral assignment as being genuine and authentic" under Federal Rule of Evidence 901. The second phase was to address the merits of Maritime's interest in the Red Road property. The district court explained that the question of authenticity was "a nice clean issue" that, if resolved against Maritime, would obviate the need to resolve the complicated dispute about the legal effect of an unrecorded assignment of a security interest in real property for which Gutierrez, the party who allegedly conveyed the assignment, did not hold title. Maritime objected on the ground that the authenticity issue should be consolidated with the merits issues, but it later conceded that an adverse ruling on authenticity would make the "other issues . . . go away."

         At the hearing for the first phase of trial, Maritime presented three witnesses: Lesley Alfonso, the Maritime director who allegedly discovered the collateral assignment; Frank Norwitch, a certified document examiner who reviewed the collateral assignment; and Raul Gutierrez, who allegedly signed the assignment. The government presented no live witnesses. Alfonso testified that in early 2010, Andrew Ferguson, Maritime's chief executive officer and the son of Steve Ferguson, asked her to search for any documents related to the Red Road property. She asserted that she discovered the assignment in the files of a deceased Maritime executive who had managed the loan transaction with Gutierrez. Alfonso also testified that she returned to the storage room to ensure that there were no other documents responsive to the description she was given. Cross-examination by the government and questioning by the district court made clear that this testimony conflicted with Alfonso's earlier deposition testimony, in which she agreed that she did not have "occasion to go back into the storage room and look at the folder or anything else that was around that document."

         Norwitch testified as an expert after the government stipulated to his qualifications. He testified that he examined the watermark and the ink used in both the typed and handwritten portions of the collateral assignment and concluded that there was "no evidence that this document was anything other than what it is purported to be." But Norwitch explained that the ink used in the document has been in commercial use for decades and that he could not determine "when [the] document was signed." And Gutierrez testified that he executed the collateral assignment on July 24, 2001, after Maritime requested additional collateral. He admitted that he failed to list the assignment in his presentence investigation report and testified that he never thought to record the multi-million-dollar transaction. Gutierrez also acknowledged that he had been convicted of crimes of fraud and that he had falsified his community-service hours after being released from prison.

         After the hearing for the first phase of trial, the district court ruled that Maritime had failed to carry its burden of proving the authenticity of the collateral assignment "by the greater weight of the evidence." The court determined that circumstantial evidence and unexplained defects present on the face of the document undermined the inference that the assignment was authentic. It also determined that the expert testimony was inconclusive, that Alfonso and Gutierrez were not credible, and that virtually no evidence corroborated the authenticity of the assignment. Having ruled that the ...

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