Pettway v. Marshall

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

BRUCE PETTWAY and EMPLOYER )

BENEFITS CONSULTING, LLC, )

)

Plaintiffs, )

)

v. ) Case No. 5:19-CV-1073-KOB

)

ATTORNEY GENERAL STEVE )

MARSHALL and OTIS PERKINS, )

)

Defendants. )

MEMORANDUM OPINION

Plaintiffs in this case allege that the Defendant violated the Fourth and Eighth

Amendments by seizing funds that Plaintiffs earned while serving as a consultant for a pair of

bingo operators in Jefferson County, Alabama. Pursuant to Federal Rule of Civil Procedure 12,

the Defendant’s instant motion to dismiss calls the numbers b(1) and b(6) to the court’s attention,

arguing that this court lacks subject-matter jurisdiction and that the complaint fails to state a

claim upon which relief can be granted. (Doc. 52.) Ultimately, though, because qualified

immunity shields the Defendant from suit, the court WILL GRANT the motion to dismiss.

Background

The Third Amended Complaint alleges that Plaintiff Bruce Pettway, a business consultant

and broker, provided consulting services to Brighton Ventures and Brighton Ventures II

(collectively, “Brighton Ventures”) in early 2019 in exchange for a one-time payment of

approximately $15,500. (Doc. 51 at 3–4). Mr. Pettway then deposited these funds into Plaintiff

Employer Benefits Consulting’s account at a BBVA Bank branch in Jefferson County, Alabama.

The City of Brighton, also located in Jefferson County, issued a license to Brighton Ventures to

conduct bingo games. (Id. at 4.) Although EBC is located in Jefferson County and Mr. Pettway’s

services allegedly took place in Jefferson County, Brighton Ventures is incorporated in Madison

County, Alabama.

On June 7, 2019, former Defendant Otis Perkins, a special agent with the Alabama

Attorney General’s Office, executed an affidavit in Madison County for seizure of several bank

accounts suspected of holding funds derived from illegal gambling activity. Specifically, the

affidavit stated that Brighton Ventures operated an illegal electronic bingo facility in Jefferson

County, and that proceeds from the facility existed in six different accounts—including

Plaintiffs’ BBVA account. (Doc. 53-2.) The affidavit pointed to Brighton Ventures’ $15,500

check to Plaintiffs—issued as “revenue share”—as evidence of illegal profit. (Id. at 6.) Based on

Agent Perkins’s affidavit, the Circuit Court of Madison County, Alabama issued a warrant,

which was executed on June 7, 2019 on Plaintiffs’ BBVA account. On June 13, 2019, BBVA

Bank notified Plaintiffs that the State of Alabama had seized and frozen the account; at the time,

the account held about $240,000.

On July 3, 2019, the State of Alabama filed an in rem civil forfeiture action in Madison

County for the allegedly illegal gambling proceeds in Plaintiffs’ BBVA account. (Doc. 54 at 10.)

Plaintiffs did not receive notice of the seizure warrant from the State until after Plaintiffs filed

the instant suit on July 10, 2019. (Doc. 51 at 6.)

Based on these facts, Plaintiffs’ Third Amended Complaint brings two1 causes of action.

First, Plaintiffs allege that by seizing $240,000 from Plaintiffs, Defendant Attorney General

1 The Third Amended Complaint originally included a third cause of action, “unlawful seizure of

property.” But during the pendency of the instant motion to dismiss, Plaintiffs voluntarily

withdrew this claim, along with all claims against Otis Perkins, on November 19, 2019. (Doc.

59.)

Steve Marshall violated the Eighth Amendment’s prohibition of excessive fines. Because the

supporting affidavit only expressly cited to Brighton Ventures’ $15,500 check, the State’s

seizure of the whole account “was grossly disproportionate to the fine [a maximum of $6,000]

which may be imposed for violating the state’s gambling law.” (Doc. 51 at 9.)

Second, Plaintiffs assert that Attorney General Marshall violated the Fourth

Amendment’s ban on unreasonable seizures. Similar to Plaintiffs’ Eighth Amendment count,

Plaintiffs contend that the account freeze was an unreasonable seizure because “the amount

seized was totally out of proportion to the maximum criminal fine ($6,000) for violation of the

State’s gambling laws.” (Doc. 51 at 12.)

Based on these alleged constitutional violations, Plaintiffs seek a declaratory judgment

that Attorney General Marshall violated Plaintiffs’ Fourth and Eighth Amendment rights, a

permanent injunction “barring Defendants from engaging in similar conduct against Plaintiffs in

the future” (Doc. 51 at 13), compensatory and punitive damages, and attorneys’ fees and costs.

Underlying Plaintiffs’ two remaining causes of action, Plaintiffs also allege several facts

to suggest that Attorney General Marshall had impure motivations in targeting Mr. Pettway. Mr.

Pettway, a black man, is the brother of Jefferson County Sheriff Mark Pettway. (Doc. 51 at 6.)

Since Sheriff Pettway’s investiture in January 2019, Plaintiffs allege that Attorney General

Marshall has publicly criticized the new sheriff’s apparent apathy about enforcing Alabama’s

gambling laws. For example, Plaintiffs allege that in April 2019, Attorney General Marshall told

a group of students at Auburn University that he would “handle the Sheriff” in response to

Sheriff Pettway’s supposed failure to enforce Alabama’s gambling laws in Jefferson County.

(Doc. 51 at 7.) But at the same time, Attorney General “Marshall has allowed an electronic bingo

operation to operate in the majority white Houston County, Alabama.” (Id. at 7.)

Mr. Pettway and EBC filed their first complaint in this court on July 10, 2019, along with

a motion to enjoin the State from freezing Plaintiffs’ BBVA bank account. (Docs. 1 & 2).

Plaintiffs amended their complaint three times, on July 19, July 23, and September 25, 2019, by

adding Agent Perkins as a Defendant and allegations that Defendants acted in bad faith in

violating Plaintiffs’ constitutional rights. (Docs. 11, 15, 51).

Attorney General Marshall moved to dismiss the entire case on Younger abstention

grounds on July 24, 2019; he argued that the court should abstain from exercising jurisdiction

over this case because Plaintiffs ask the federal court to intervene in the ongoing state forfeiture

proceeding in Madison County. (Doc. 17). The court denied the motion because Plaintiffs

presented facially plausible evidence that Defendants acted in bad faith—an allegation that, if

true, precludes the Younger doctrine. See Wilson v. Thompson, 593 F.2d 1375, 1387 (5th Cir.

1979.) Specifically, the court found that “forfeiture of $240,000 for alleged ‘gambling proceeds’

far below that amount . . . strikes the court as facially suspect.” (Doc. 30 at 8.)

After the court denied Attorney General Marshall’s motion—and, apparently, after the

State investigated the BBVA account for other illegally obtained proceeds—the State unfroze all

but $15,500 in Plaintiffs’ account. Plaintiffs filed their Third Amended Complaint soon

thereafter (Doc. 51), and the court found Plaintiffs’ motion to unfreeze the funds to be moot.

(Doc. 56.) The civil forfeiture proceeding remains pending before the Madison County Circuit

Court regarding the $15,500 that Brighton Ventures paid Plaintiffs.

Defendants filed the instant motion to dismiss on October 8, 2019 (Doc. 54), to which

Plaintiffs responded (Doc. 57), and Defendants replied. (Doc. 58.) Pursuant to Defendants’

motion, which raised Eleventh Amendment immunity as a defense, Plaintiffs conceded that the

Eleventh Amendment prevents claims against Defendants in their official capacities. On

November 14, 2019, Plaintiffs filed a voluntary motion to dismiss all claims against Defendants

in their official capacities. (Doc. 59.) Because Plaintiffs only sued Agent Perkins in his official

capacity (Doc. 51 at 3), no claims remain against Agent Perkins. The court dismissed Agent

Perkins from the case on May 28, 2020. (Doc. 60.)

After the dust settled, Plaintiffs’ remaining two Counts contend that Attorney General

Steve Marshall, pursuant to 42 U.S.C § 1983 and in his individual capacity only, violated

Plaintiffs’ Eighth Amendment rights (Count I) and Fourth Amendment rights (Count II) by

freezing their BBVA account.2 Attorney General Marshall’s motion to dismiss does not attack

the facial plausibility or sufficiency of Plaintiffs’ Third Amended Complaint; instead, he raises

two affirmative defenses—prosecutorial immunity and qualified immunity—and argues once

again that the Younger abstention doctrine applies. Because, as explained below, Plaintiffs’

Eighth Amendment claim is unripe and Attorney General Marshall is entitled to qualified

immunity regarding both of Plaintiffs’ claims, the court need not address prosecutorial immunity

and will not revisit the Younger abstention arguments.

2 Although Plaintiffs no longer allege any causes of action under state law, Plaintiffs comment as

an aside that Attorney General Marshall violated Ala. R. Civ. P. 64(b)(2)(B) because the warrant

failed to notify Plaintiffs “of their right to a pre-judgment hearing on the issue of dissolution.”

(Doc. 51 at 5–6.) To the extent that Plaintiffs assert this argument, the court finds it inapplicable

because Plaintiffs do not explain why Alabama Rule of Civil Procedure 64 should apply to the

State of Alabama’s execution of a seizure warrant. Under Plaintiffs’ apparent line of reasoning,

law enforcement officers would be required to follow a dual-track system, under which they (1)

seize contraband pursuant to the procedures involving a warrant or other law-enforcement

process and (2) adhere to the separate civil procedures under Rule 64. But Plaintiffs cite to no

case law to support the proposition that Rule 64 applies to the instant case. This lack of relevant

case law is understandable because, as the committee notes on the Rule explain, the purpose of

Rule 64 is supporting creditors’ interests while also protecting debtors from unjust judicial writs

of seizure—not muzzling law-enforcement seizures of personal property for the purpose of filing

forfeiture actions. See Committee Comments to Ala. R. Civ. P. 64.

Analysis

Qualified immunity protects government officials performing discretionary functions

from individual capacity suits unless the official violates a “clearly established” statutory or

constitutional right “of which a reasonable person would have known.” Hope v. Pelzer, 536 U.S.

730, 739 (2002). The purpose of qualified immunity is to allow government officials to do their

jobs without specter of personal liability haunting their every move. “When improper motive is

part of the underlying constitutional tort—and where evidence exists of mixed motives—a

defendant is still entitled to qualified immunity if the record indisputably establishes that the

defendant in fact was motivated, at least in part, by lawful considerations.” Mitchell v. City of

Jacksonville, 734 F. App’x 649, 651 (11th Cir. 2018) (emphasis added; quoting Stanley v. City of

Dalton, 219 F.3d 1280, 1296 (11th Cir. 2000)).

Whether a government official is entitled to qualified immunity is a question of law that

the court should determine “at the earliest possible stage of a litigation.” Anderson v. Creighton,

483 U.S. 635, 646 n.6 (1987). To receive qualified immunity, the government official bears the

initial burden to prove that he was acting within the scope of his discretionary authority. Vinyard

v. Wilson, 311 F.3d 1340, 1346 (11th Cir. 2002).

If the official can establish that he was acting within his discretionary authority, the

plaintiff then shoulders the burden of showing that qualified immunity is not appropriate. Lee v.

Ferraro, 284 F.3d 1188, 1194 (11th Cir. 2002). A two-prong test, performed in either order,

determines whether qualified immunity is appropriate. Saucier v. Katz, 533 U.S. 194, 201

(2001); Pearson v. Callahan, 555 U.S. 223, 236 (2009). One prong requires the court to ask

whether, “[t]aken in the light most favorable to the party asserting the injury . . . the facts alleged

show the officer’s conduct violated a constitutional right.” Gonzalez v. Reno, 325 F.3d 1228,

1234 (11th Cir. 2003) (citing Saucier, 533 U.S. at 201). The other prong asks whether the right

was clearly established at the time of the alleged violation. Gonzalez, 325 F.3d at 1234. A right is

clearly established when “the law at the time of an incident [provides] ‘fair warning’ to the

defendants that their alleged conduct was unconstitutional.” Salvato v. Miley, 790 F.3d 1286,

1292 (11th Cir. 2015). Put simply, a plaintiff’s claim can survive a motion to dismiss raising

qualified immunity if “the plaintiff’s allegations state a claim of violation of clearly established

law.” Mitchell v. Forsyth, 472 U.S. 511, 526 (1985).

In this case, Plaintiffs clearly assert that Attorney General Marshall operated within his

discretionary role at all relevant times. See (Doc. 51 at 6) (“It was the function of Defendant

General Marshall in his administrative role to ensure that the Search and Seizure Warrant

complied with Alabama’s rules for in rem proceedings.”) See also (Doc. 57 at 8) (conceding that

Defendants acted within the scope of their discretionary authority.) The burden then shifts to

Plaintiffs to show that Attorney General Marshall violated a clearly established constitutional

right. See Lee, 284 F.3d at 1194. Plaintiffs contend that Attorney General Marshall violated two

Constitutional rights: freedom from excessive fines under the Eighth Amendment (Count I) and

freedom from unreasonable searches and seizures under the Fourth Amendment (Count II).

Plaintiffs’ claims fail on both Counts.

Plaintiffs’ Count I fails because Plaintiffs incorrectly assume that the freeze of the BBVA

account constituted a “fine” under the Eighth Amendment. In the context of in rem civil

forfeitures, the relevant inquiry in determining the applicability of the excessive fines clause is

not the nomenclature of the mechanism by which a government seizes property—e.g., civil, in

rem forfeiture or criminal fine—but whether the payment is punitive or remedial. See United

States v. Bajakajian, 524 U.S. 321, 331 n.6 (1998) (“Because some recent federal forfeiture laws

have blurred the traditional distinction between civil in rem and criminal in personam forfeiture,

we have held that a modern statutory forfeiture is a ‘fine’ for Eighth Amendment purposes if it

constitutes punishment even in part, regardless of whether the proceeding is styled in rem or in

personam.”) See also Timbs v. Indiana, 139 S. Ct. 682, 690 (2019) (“civil in rem forfeitures are

fines for purposes of the Eighth Amendment when they are at least partially punitive.”)

Conversely, non-punitive forfeitures fall outside the bounds of the Eighth Amendment.

United States v. One Hundred Thirty Thousand Fifty-Two Dollars in United States Currency,

909 F. Supp. 1506, 1513 (M.D. Ala. 1995); Bajakajian, 524 at 328 (determining that forfeitures

are fines only “if they constitute punishment for an offense”); Browning-Ferris Indus. v. Kelco

Disposal, 492 U.S. 257, 265 (1989) (explaining that a “fine” is “a payment to a sovereign as

punishment for some offense.”)

The instant case features neither a payment nor a punishment. In the underlying civil in

rem forfeiture action in State court, the State of Alabama seeks forfeiture of the $15,500 in

Plaintiffs’ account pursuant to Ala. Code § 13A-12-30, which states that “[m]oney used as bets

or stakes in gambling activity in violation of this article is forfeited to the state and by court order

shall be transmitted to the general fund of the state.” In the State action, the State of Alabama

seeks recovery of the proceeds of allegedly illegal gambling activity. Unlike the forfeiture of

property used in furtherance of illegal activity—which, if punitive, requires an Eighth

Amendment proportionality analysis to evaluate whether the forfeiture is excessive—the

“[f]orfeiture of proceeds cannot be considered punishment, and thus, subject to the excessive

fines clause, as it simply parts the owner from the fruits of the criminal activity.” United States v.

Nelson, No. 3:10-cr-23-J-32, 2012 U.S. Dist. LEXIS 20982, at *4 (M.D. Fla. Feb. 21, 2012)

(emphasis added) (citing to United States v. Tilley, 18 F.3d 295 (5th Cir. 1994) and United States

v. Alexander, 32 F.3d 1231, 1236 (8th Cir. 1994)). See also Austin v. United States, 509 U.S.

602, 622 n.14 (1993) “a fine that serves purely remedial purposes cannot be considered

‘excessive’ in any event”); United States v. Masino, No. 3:16cr17, 2019 U.S. Dist. LEXIS

34862, at *34 n.18 (N.D. Fla. Mar. 5, 2019) (distinguishing, in the context of a governmental

forfeiture action to recover profit gleaned from an illegal bingo operation, between the

“forfeiture of only proceeds . . . [of] criminally derived property” versus “money legitimately

obtained”); United States v. Levine, 905 F. Supp. 1025, 1031 (M.D. Fla. 1995) (finding that civil

forfeiture of illegal proceeds is remedial rather than punitive.)

Furthermore, the court doubts that Plaintiffs’ Eighth Amendment claim is even ripe for

review. Although the State initially sought forfeiture of Plaintiffs’ entire bank account, estimated

to contain approximately $240,000, the State later amended its in rem complaint to seek only

$15,500. (Doc. 53-4.) The Third Amended Complaint in this case, filed roughly six weeks after

the State amended its in rem complaint, states that the “seizure by the Attorney General of the

$240,000 bank account of Plaintiffs over at most a $15,500 dispute is grossly disproportionate to

the fine which may be imposed for violating the State’s gambling law . . . [and a] forfeiture by

Defendants of Plaintiffs’ quarter million-dollar bank account where the maximum criminal fine

is $6,00 constitutes an excessive fine.” (Doc. 51 at 9–10.) Based on this text from the Third

Amended Complaint, the court is unsure whether Plaintiffs specifically contest the initial freeze

of the entire account, the ongoing civil in rem proceeding regarding only the $15,500, or both.

If Plaintiffs’ Eighth Amendment count concerns the initial freeze, the issue is moot

because the State un-froze all but the disputed $15,500 in the account on August 9, 2019, and

Plaintiffs filed the operative complaint on September 25, 2019. If, on the other hand, Plaintiffs

contest the civil in rem action concerning the remaining $15,500, that issue is unripe because

“challenges under the Excessive Fines Clause are also generally not ripe until the actual, or

impending, imposition of the challenged fine.” Cheffer v. Reno, 55 F.3d 1517, 1523 (11th Cir.

1995). In Cheffer, the Eleventh Circuit cited to United States v. Fleetwood Enters., Inc., 689 F.

Supp. 389, 392 (D. Del. 1988) for the proposition that an Eighth Amendment claim or defense is

unripe until an actual fine is imposed. Cheffer, 55 F.3d at 1523. In Fleetwood, the defendant

mobile home manufacture challenged on Eighth Amendment grounds the government’s attempt

to recover civil penalties for the manufacturer’s alleged thousands of violations of a federal

safety statute. The manufacturer argued that the potential maximum fine could be as much as

$19,428,000 if the court applied the maximum statutory penalty of $1,000 per violation to each

of the charged 19,428 safety violations. The district court found that the “issue is not yet ripe for

judgment. Whether [the statute] is unconstitutional as applied to defendant ultimately depends

upon the size of the fine the Court levies on the defendant, if the defendant in fact is found to

have violated [the statute]. Because the Court has discretion in determining the appropriate

amount of any fine imposed on defendant, the Court at this time cannot say that defendant’s

constitutional rights have been or will be infringed.” Id. at 392.

Similarly, in the instant case—even assuming that the State’s seizure of $15,500 pursuant

to Ala. Code § 13A-12-30 might constitute a fine under the Eighth Amendment—the Circuit

Court of Madison County, Alabama has not yet determined whether, in fact, Plaintiffs will forfeit

any funds. So until the Circuit Court renders its decision, Plaintiffs’ Eighth Amendment claim is

unripe.

Ultimately, because the State of Alabama’s investigatory and temporary freeze of

Plaintiffs’ bank account falls outside the purview of the Eighth Amendment’s prohibition on

excessive fines, and because Plaintiffs’ Eighth Amendment claim is unripe, the court WILL

DISMISS Plaintiffs’ Count I.

Plaintiffs’ Count II also fails because Plaintiffs fail to show how Attorney General

Marshall’s conduct violated Plaintiffs’ Fourth Amendment rights. See Gonzalez v. Reno, 325

F.3d at 1234. The Fourth Amendment establishes that “[t]he right of the people to be secure in

their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not

be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or

affirmation, and particularly describing the place to be searched, and the persons or things to be

seized.” U.S. Const. amend. IV.

Plaintiffs allege that the State’s freeze of Plaintiffs’ BBVA account was unreasonable

under the Fourth Amendment because the freeze (a) physically occurred at a BBVA branch

location in Madison County that Plaintiffs never used, and (b) was excessive. But Plaintiffs cite

to no authority to suggest how either of these facts relates to the pivotal Fourth Amendment

question of whether the State had probable cause to issue a warrant and freeze the BBVA

account. Because “[t]he reasonableness of a seizure or arrest under the Fourth Amendment turns

on the presence or absence of probable cause,” Case v. Eslinger, 555 F.3d 1317, 1326 (11th Cir.

2009) (citation omitted), the presence of probable cause precludes a Fourth Amendment claim.

But Plaintiffs do not contest the issue of probable cause; instead, they first argue that

“[i]n every other county in which the Attorney General has seized property in a gambling

forfeiture action, the property seized was located in the county where the seizure took place.”

(Doc. 51 at 8.) This contention is mere tautology. As a general proposition, a seizure of property

necessarily occurs where the property exists, else the seizor would have nothing to seize. But

even beyond this argument’s facial invalidity, Plaintiffs fail to explain how the State’s seizure of

Plaintiffs’ account from BBVA’s Madison County branch demonstrates a lack of probable cause.

Plaintiffs’ other argument, that the “seizure of an amount higher than the maximum

criminal fine is unconstitutionally unreasonable,” also lacks merit. (Doc. 51 at 11). Plaintiffs

attempt to bolster their argument by citing extensively to One 1958 Plymouth Sedan v.

Pennsylvania, 380 U.S. 693, 699 (1965). But the Supreme Court in One 1958 Plymouth only

held that the Fourth Amendment’s exclusionary rule of evidence applies equally to both criminal

and forfeiture proceedings, not that a government entity cannot seize property worth more than a

fine associated with a defendant’s underlying criminal conduct. Id. at 696.

In One 1958 Plymouth, the Commonwealth of Pennsylvania arrested a man for

smuggling 31 cases of untaxed liquor across state lines; then, as provided by Commonwealth

law, the government permanently seized both the cases and the car that conveyed them.

Although the trial court held that the arresting officers lacked probable cause to search the car in

the first place, the Pennsylvania Supreme Court on appeal held that the officers did not need

probable cause to seize the vehicle. Id. at 695. Although the United States Supreme Court noted

as an aside that the vehicle was worth more than the maximum penalty associated with the

smuggling offense, the Court’s point was to highlight the need for probable cause whenever a

government entity seizes anything of value. Id. at 701. The Court concluded that, on remand, the

Pennsylvania court should determine whether the Commonwealth had probable cause to search

the vehicle. Id. at 702.

Here, by contrast, Plaintiffs have not even argued that the State lacked probable cause to

seize the BBVA account. Nor could Plaintiffs reasonably argue that the State lacked probable

cause. Officer Perkins’s affidavit supporting the seizure warrant reveals a thorough, step-by-step

description of how $15,500 of “revenue share” from an illegal gambling facility operated by

Brighton Ventures in Jefferson County wound up in Plaintiffs’ BBVA bank account. (Doc. 53-2

at 3–7.) The court makes no determination about whether the $15,500 that Brighton Ventures

paid to Plaintiffs constitutes the fruit of illegal gambling activity—an issue currently pending

before the Circuit Court of Madison County. But the court does find that the State had probable

cause to seize Plaintiffs’ BBVA account. For this reason, Plaintiffs’ Fourth Amendment claim

fails as a matter of law, and the court WILL DISMISS Plaintiffs’ Count II.

Conclusion

Because Attorney General Marshall is entitled to qualified immunity regarding both the

Eighth Amendment and Fourth Amendment claims against him, and because Plaintiffs’ Eighth

Amendment claim is unripe, the court WILL GRANT his motion to dismiss (Doc. 52) and

DISMISS the case with prejudice. The court will enter a separate order accompanying this

memorandum opinion.

DONE and ORDERED this 16th day of July, 2020.

____________________________________

KARON OWEN BOWDRE

UNITED STATES DISTRICT JUDGE