Petition — United States v. One Assortment of 89 Firearms

on: : ‘reme Court, U.S.

wig ag ewe MPR

No. 20 1982

ith

ju the Supreme Court of the United States

OCTOBER TERM, 1982

* arms SEs e \ ‘

UNITED STATES OF AMERICA, PETITIONER

ONE ASSORTMENT OF 89 FIREARMS |

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

REx E. LEE

Solicitor General

D. LOWELL JENSEN

Assistant Attorney General

ANDREW L. FREY

Deputy Solicitor General

RICHARD G. WILKINS

Assistant to the Solicitor General

SIDNEY M. GLAZER

Attorney

Department of Justice

Washington, D.C. 20530

(202) 633-2217

QUESTION PRESENTED

Whether a prior acquittal on criminal charges in-

volving firearms precludes a subsequent in rem for-

feiture proceeding against the firearms.

(1)

TABLE OF CONTENTS

Page

Cpbenbees REO W ....ceccccscrssssciestatseeeesnaen IS LOSES 1

Jurisdiction .......-..censessisctscccciesdsicietecbescekessseuuanaaaeeaaanee 2

Starbute fewolwed .—ecencccccosnsccsnsssisnistesteseeee 2

DOR CTNGTE 2 nncccccccensancirocnsnsuntdinunn 2

Reasons for granting the petition ..00..0...........c.ccceccceceeeeees 7

CemCR EOE nnn ecannccensessnncinsenniosnsstsealisuieassee 19

BORGES Bh onnecncceececceevsseserrncinsiene la

Mappa, BB annnnncccccnceeiecie-sensensie lba

Bimmpemn GT CC an essceesesscnicseversversssitnne 80a

Agpendiz D). .......--<cccrss+<10ssjn 8la

Prem, anes eesice a ntemeennseee 45a

TABLE OF AUTHORITIES

Cases:

Ashe v. Swenson, 397 U.S. 486 ...............:000000000000000 12,17

Boyd v. United States, 116 U.S. 616 .000.00 cece 16

Calero-Toldeo v. Pearson Yacht Leasing Co., 416

1h. St | Sennen 14

Coffey v. United States, 116 U.S. 486........ 5, 6, 7, 9, 10, 11,

12,17

Glup v. United States, 523 F.2d 557 20000000000... 8, 17-18

Helvering Vv. Mitchell, 308 U.S. 891 ..0...0.000cccccceeee passim

Hepner V. United States, 218 U.S. 108 ...0000..o.. 17

Lewis Vv. United States, 445 U.S. 66 oo... 16

Murphy Vv. United States, 272 U.S. 680 ............ 5, 10, 11-12

One Lot Emerald Cut Stones v. United States, 409

GRR, GIBB: acc cctincaehioel 5, 6, 11, 18, 17

One 1958 Plymouth Sedan vy. Pennsylvania, 380

WB, COB ncciitiecnititeetittcan tiesto 16

Scarborough v. United States, 481 U.S. 568 .......... 16

Stone v. United States, 167 U.S. 178 5, 10,12

United States v. Batchelder, 442 U.S. 114 .............. 16

(mI)

IV

Cases—Continued Page

United States Vv. 86 Firearms, 623 F.2d 648 ....... . 16,17

r United States v. Mulcahey, No. 77-00013 (D.S.C.

4 a i iasseuadsamieyes 8

ft —~~Tnited States V. One Aeseessmment of 12 Rifles and

21 Handguns, 318 F. Supp. 641 ...........0.......0. 18

United States v. One Dodge Sedan, 118 F 2d 5652.... 10

United States v. Regan, 232 US. 87 ..............0:000008 18

United States v. Seven Firearms, 632 F.2d 1276.... 15,17

United States v. 16,179 Moslo Italian .22 Caliber

Winlee Derringer Convertible Starter Guns, 448

F.2d 468, cert. denied, 404 U.S. 983 .........0........ 15-16, 17

United States v. $2,500 in United States Currency,

AE Ee? Pa 11

United States v. 26 Firearms, 485 F. Supp. 549,

I oc se goaiedntipeniendesadibonapen 15

United States v. Various Firearms, 523 F.2d 47.... 15,17

United States v. Walters, 638 F.2d 947 .................. 15,17

United States v. Ward, 448 U.S. at #4#47%2._13-14, 16, 17

Various Items of Personal Property v. United

I I I i 1 acantinllibabase 17, 18

Constitution and statutes:

United Staves Constitution, Double Jeopardy

a. ccpeeescremmmnsineaial idniipabauasiaes 11

I nc eienectbanibonald 2-8, 4,16

ES ERE Re A aor Se eee 3

18 UB.C. (& Gap. TV) GBA .........cccccsccceccccscsesee i 6

a ssimmissanatammie tials 8

I i aicceednlsshcakallloon passim

I lt eecas ae 18, 16

ee eres MUI EOD GID cvcccnccscccontncsscicascossens 14

no sceabbucdhdeniiopabonelunealcts 14

|S, EER ee ene Sc Eloean cer) wd, Hea 14

Miscellaneous:

1 BJ. Moore & T. Currier, Moore’s Federal Prac-

TES ARETE SAINI POC aA TRT 10

Fed. R. Crim. P.:

SII IID ssn a csintnnaceniaweooielibtitiguanibialometaloaietints 19

ARSENE clonal CF ES cot ee ee 19

Rule 82(b) (2) .... eo the’ 19

Iu the Suprenve Court of the United States

OCTOBER TERM, 1982

No.

UNITED STATES OF AMERICA, PETITIONER

Vv.

ONE ASSORTMENT OF 89 FIREARMS

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

The Solicitor General, on behalf of the United

States, petitions for a writ or certiorari to review

the judgment of the United States Court of Appeals

for the Fourth Circuit in this case.

OPINIONS BELOW

The en bane opinion of the court of appeals (App.

A, infra, la-14a) is reported at 685 F.2d 913. The

earlier panel opinion (App. B, infra, 15a-29a) is

reported at 669 F.2d 206. The opinion of the dis-

trict court (App. D, infra, 3la-44a) is reported at

511 F. Supp. 133. An earlier opinion of the district

court (App. E, infra, 45a-55a) is reported at 463

F. Supp. 365.

(1)

2

JURISDICTION

The judgment of the court of appeals (App. C,

infra, 30a) was entered on August 23, 1982. On

November 12, 1982, the Chief Justice extended the

time in which to file a petition for a writ of certi-

orari to and including December 21, 1982. The juris-

diction of this Court is invoked under 28 U.S.C.

1254(1).

STATUTE INVOLVED

Section 924(d) of Title 18 provides:

Any firearms or ammunition involved in or

used or intended to be used in, any violation of

the provisions of this chapter or any rule or reg-

ulation promulgated thereunder, or any violation

of any other criminal law of the United States,

shall be subject to seizure and forfeiture and

all provisions of the Internal Revenue Code of

1954 relating to the seizure, forfeiture, and

disposition of firearms, as defined in section

5845(a) of that Code, shall, so far as applicable,

extend to seizures and forfeitures under the pro-

visions of this chapter.

STATEMENT

1. On March 31, 1977, the United States com-

menced an in rem civil action in the United States

District Court for the District of South Carolina

seeking forfeiture to the United States of an assort-

ment of firearms seized on January 20, 1977, by

Special Agents of the Bureau of Alcohol, Tobacco

and Firearms. The complaint alleged that the fire-

arms had been used and possessed on January 20,

1977, and prior thereto by Patrick M. Mulcahey

while he was engaged in the business of dealing in

firearms without a license, in violation of 18 U.S.C.

3

922(a)(1) and 923(a). Forfeiture was sought pur-

suant to 18 U.S.C. 924(d).’

Mulcahey filed a claim for recovery of the fire-

arms and also filed an answer to the forfeiture com-

plaint. In his answer, Mulcahey raised collateral

estoppel and res judicata as a bar to the forfeiture.

Muleahey had previously been tried and acquitted of

charges that he had been engaged in the business of

dealing in firearms without being licensed, in vioia-

tion of 18 U.S.C. 922(a)(1) and 924(a). United

States v. Mulcahey, No. 77-00013 (D.S.C. Mar. 16,

1977) (App. A, infra, 2a). At the criminal trial,

the government’s evidence showed that Mulcahey

had not been issued a license to deal in firearms

for the period of July 1, 1975, to March 31,

1977, but that he nevertheless bought and sold fire-

arms on numerous occasions during this period

(App. D, infra, 33a-35a). Mulcahey testified in his

own defense, admitting that he had no license (Tr.

247)* and that he had bought and sold firearms dur-

ing the period set forth in the indictment (Tr. 247-

279). He claimed, however, that he had been en-

trapped into making the illegal firearms tranractions

(see, e.g., Tr. 248-249, 257-263, 273). The trial

court thereafter submitted the entrapment defense

to the jury (Tr. 294-296). The jury returned a gen-

eral verdict of not guilty.

On motion of the government in the forfeiture

proceeding, the district court struck Mulcahey’s col-

1The number of firearms involved in this action has

varied somewhat with time. See App. E, infra, 45a. The

original complaint listed an assortment of 92 firearms but

was subsequently amended to include an additional automatic

pistol, bringing the total ty 98. Four of these guns were

returned to Mulcahey’s wife, leaving 89 guns as tho subject

of the forfeiture proceeding (App. D, infra, 36a).

*“Tr.” refers to the transcript of the criminal trial.

4

lateral estoppel and res judicata defenses (App. E,

infra, 45a-51a). The parties had previously stipu-

lated that the transcript of the prior criminal trial

would be submitted to the court in lieu of live testi-

mony (App. A, infra, 2a). In its findings of fact, the

court found that Mulcahey had no federal firearms

dealer’s license and that he did indeed sell and pur-

chase numerous firearms and ammunition, including

multiple purchases on several occasions of the same

type of firearms (App. D, infra, 33a, 39a). The

court held that a forfeiture proceeding under 18

U.S.C. 924(d) is remedial in nature and is properly

characterized as a civil proceeding (App. D, infra,

37a). The court concluded that the government had

proved by a preponderance of the evidence that Mul-

cahey was engaged in the business of dealing in fire-

arms and ammunition without the required federal

license (ibid.). The firearms used or intended to be

used in violation of 18 U.S.C. 922(a)(1) were there-

fore found to be subject to forfeiture under 18 U.S.C.

924(d) (App. D, infra, 37a-44a).*

® The court concluded (App. D, infra, 42a-48a) :

In the instant case, although the claimant did not Wis»

play his entire assortment of firearms, he did maintain

them all in his residence, troix which he also operated

an army surplus >usiness. The fact that the claimant

kept the entire assortment of firearms so accessible to

his surplus shov room, that he repeatedly went into the

non-public area of his residence to obtain the firearms

he did display to the government agents, the claimant's

own statements, his course of dealing, and the wealth of

circumstantial evidence in the record prove by a pre-

ponderance of the evidence that he used or intended to

use all of the firearms he personally possessed as an

inventory to be drawn from in the course of dealing

in firearms, in violation of 18 U.S.C. § 922(a) (1).

5

2. A divided panel of the court of appeals reversed

(App. B, infra, 15a-29a). Relying on Coffey v.

United States, 116 U.S. 436 (1886), the panel held

that the forfeiture action was barred by Mulcahey’s

criminal acquittal because the criminal action in-

volved “the identical facts’ of the forfeiture pro-

ceeding and the “essential elements” of the forfeiture

action had therefore been resolved against tl.> gov-

ernment (App. B, infra, 22a).

Chief Judge Winter dissented (App. B, infra,

23a-29a). He concluded (id. at 23a) that while

“Coffey holds that a subsequent criminal forfeiture

is barred by an earlier acquittal on criminal charges

arising out of the same facts,” more recent Supreme

Court decisions “compel the conclusion that the for-

feiture in the present case is civil.’”’ A subsequent

civil action, Judge Winter reasoned, is not barred by

a criminal acquittal “because the standards of proof

in criminal and civil proceedings are different”

(ibid.). Relying on Helvering v. Mitchell, 303 U.S

391 (1938), Murphy v. United States, 272 U.S. 630

(1926), and Stone v. United States, 167 U.S. 178

(1897), Judge Winter concluded that “if the for-

feiture proceeding is civil in nature,” res judicata

does not bar the civil action, and “the standard of

proof argument, by itself, is enough to defeat any

resort to collateral estoppel” (App. B, infra, 24a).

Judge Winter noted that the rationale adopted by the

majority was rejected in One Lot Emerald Cut

Stones v. United States, 409 U.S. 232 (1972), be-

cause the forfeiture provision at issue in that case

was found to be civil in nature. He contended that

similar reasoning controlled in this case. “The for-

feiture statute here, 18 U.S.C. § 924(d), was mani-

festly designed to ait in the enforcement of gun

6

control laws by preventing the circulation of firearms

which had been illegally obtained. One Lot thus com-

pels the conclusion that the forfeiture at issue here

is civil in nature, so that the double jeopardy and res

judicata claims must be rejected. It matters not,

despite the majority’s views, that the necessary

allegations in the criminal proceeding and the for-

feiture proceeding were identical” (App. B, infra,

at 27a, footnote omitted).

3. On rehearing en banc the court of appeals ad-

hered to the panel decision by a 5-4 vote (App. A,

infra, la-4a). The majority again specifically relied

on Coffey v. United States, supra, and rejected the

government’s argument that a prior criminal ac-

quittal does not bar a subsequent forfeiture proceed-

ing (App. A, infra, 3a-5a). It concluded that the

sanction at issue here is criminal in nature, relying

on the fact that the forfeiture provision is contained

in 18 U.S.C. (& Supp. IV) 924 and “[e]verything in

§ 924 provides a penalty, be it fine, prison or for-

feiture, for the violation of a provision of the Gun

Control Act” (App. A, infra, 9a-10a). The court dis-

tinguished Helvering v. Mitchell, supra, and other

Supreme Court precedent providing for civil penalties

subsequent to a criminal acquittal on the ground that

“Tt}here is nothing remedial about forfeiture under

§ 924(d)” (App. A, infra, 10a).

Judge Winter, joined by three others, again dis-

sented. Relying in part on the reasoning of his dis-

sent at the panel stage, he further noted that the

“majority errs when it confidently asserts that the

jury verdict in the criminal action conclusively set-

tled the issue that Mulcahey was not engaged in the

business of dealing in firearms without a license”

(App. A, infra, 18a). Because of Mulcahey’s asser-

7

tion of entrapment, “it is equally possible that the

jury found that Mulcahey was engaged in the bus-

iness of dealing in firearms without a license, but

had been entrapped into committing an illegal sale,

as [that it] found that Mulecahey was not so en-

gaged” (ibid.). Judge Winter also remained con-

vinced “that the forfeiture provisions of 18 U.S.C.

924(d) are civil in nature so that any determina-

tion in the criminal prosecution is irrelevant to a

decision of forfeiture” (App. A, infra, 18a; emphasis

in original). This conclusion is reinforced, Judge

Winter reasoned, by the fact that the forfeiture pro-

vision is significantly broader in scope than the crim-

inal sanctions (id. at 18a-14a). The forfeiture provi-

sion provides “disjunctively that ‘[a]ny firearm in-

volved in or used or intended to be used in, any viola-

tion of this chapter * * * shall be subject to seizure

and forfeiture * * *’ (emphasis added). [18 U.S.C.

924(d)]. Nothing in the provision of § 922 under

which Mulcahey was prosecuted renders an intention

to engage in the business of dealing in firearms with-

out a license illegal” (App. A, infra, 18a-14a; foot-

note omitted).

REASONS FOR GRANTING THE PETITION

Section 924(d) of Title 18 of the United States

Code provides for the seizure and forfeiture of

“fajny firearm or ammunition involved in or used

or intended to be used in, any violation of [federal

gun control law].” Relying solely on Coffey v. United

States, 116 U.S. 436 (1886), the court of appeals

ruled that an acquittal on criminal charges bars a

subsequent forfeiture action under 18 U.S.C. 924(d),

notwithstanding the fact that forfeiture actions

under Section 924(d) have traditionally been sub-

ject to the preponderance of evidence standard of

8

proof rather than the much stricter criminal stand-

ard. Although the doctrinal basis for its preclusion

rule is unclear, the lower court’s decision rests on the

premise that “[t]he criminal verdict conclusively de-

cided that the firearms * * * were not ‘involved in

or used or intended to be used in the violation’” of

federal law (App. A, infra, 8a). This factual resolu-

tion, the court concluded, is binding on all subsequent

judicial proceedings involving the firearms and bars

the forfeiture action here.

The premise and conclusion of the court of appeals

conflict with controlling legal precedent and are

faulty as a matter of logic. An acquittal, of course,

establishes only that the government has not shown

beyond a reasonable doubt that certain facts exist;

it does not “conclusively” establish that those facts

do not exist. The decisions of this Court, therefore,

clearly hold that a criminal acquittal does not bar a

subsequent “civil action requiring a different degree

of proof.” Helvering v. Mitchell, 303 U.S. 391, 405

(1988). The court of appeals, in apparent recogni-

tion of this rule, concluded that a forfeiture under

18 U.S.C. 924(d) is neither “civil” (App. A, infra,

12a) nor “remedial” (id, at 10a). This conclusion,

however, conflicts with the decisions of numerous

other circuits that have held that 18 U.S.C. 924(d)

embodies a remedial, civil penalty. See, e.g., Glup v.

United States, 523 F.2d 557, 561 (8th Cir. 1975).

The en banc decision of the court of appeals raises

issues that merit the attention of this Court. The

lower court has disregarded controlling decisions of

this Court and, by attaching a “criminal” label to

this forfeiture action, has rendered an opinion in

direct conflict with every other court of appeals that

9

has addressed the question whether 18 U.S.C. 924(d)

embodies a civil or a criminal sanction.

1. The decision of the en bane court below rests

squarely upon a single aged precedent—Coffey v.

United States, supra. Coffey, however, is a slender

reed upon which to hang the entire weight of this

decision. Indeed, more recent opinions of this Court

raise the question whether the “rule” of the Coffey

case retains any independent vitality.

The Court in Coffey held that a forfeiture action

brought against certain distilling equipment was

barred by the owner’s prior acquittal on charges of

removing and concealing distilled spirits with the in-

tent to defraud the revenue.‘ The Court reasoned

that ‘“‘where an issue raised as to the existence of the

act or fact denounced has been tried in a criminal

proceeding, instituted by the United States, and a

judgment’ of acquittai has been rendered in favor of

a particular person, that judgment is conclusive in

favor of such person, on subsequent trial of a suit

in rem by the United S.ates, where, as against him,

the existence of the same act or fact is the matter in

issue, as a cause for the forfeiture of the property

prosecuted in such suit in rem” (116 U.S. at 443).

The Court noted and rejected the argument that the

criminal acquittal should not bar the in rem action

because the acquittal “may have taken place because

of the rule requiring guilt to be proved beyond a rea-

sonable doubt, and that, on the same evidence, on the

question of preponderance of proof, there might be a

* The statute at issue in Ceffey provided that whenever any

person engaged in the distilling business “defraucs * * * the

United States of the tax on the spirits distilled by him * * *

he shall forfeit the distillery aid distilling apperatus * * *

and shall be fined * * * and be imprisoned” (116 U.S. at 487).

10

verdict for the United States * * *” (ibid.). The

Court concluded that differing standards of proof be-

tween a criminal and a forfeiture action do not pre-

vent preclusion because “ie fact or act has been put

in issue and determined against the United States;

and all that is imposed by the statute, as a conse-

quence of guilt, is a punishment therefor. There could

be no new trial of the criminal prosecution after the

acquittal in it; and a subsequent trial of the civil suit

amounts to substantially the same thing, with a dif-

ference only in the consequences following a judgment

adverse to the claimant” (ibid.).

The Coffey decision has remained something of an

enigma, because the Court did not specify the legal

foundation for the preclusion rule announced by the

case. Was the forfeiture action barred by res judi-

cata? Collateral estoppel? Double jeopardy’? Subse-

quent courts and commentators have been uncertain.

See generally 1B J. Moore & T, Currier, Moore’s Fed-

eral Practice {| 418[3] (2d ed. 1982). See also United

States v. One Dodge Sedan, 118 F.2d 552 (8d Cir.

1940) (collecting cases and law review articles criti-

cizing Coffey). Whatever the original foundation for

the Coffey rule, however, later decisions of this Court

have given it an extremely narrow scope, See Helver-

ing v. Mitchell, 303 U.S, 391, 405-406 (1988); Mur-

phy v. United States, 272 U.S. 630, 681-6382 (1926) ;

Stone v. United States, 167 U.S. 178, 186-187 (1897).

In Helvering, the Court was faced with an action

to recover a substantial monetary penalty for fradu-

lent avoidance of income tax. The defendant argued

that his prior acquittal on charges of willfully at-

tempting to evade and defeat the tax precluded the

subsequent penalty action. The court of appeals, re-

lyingy principally on Coffey, agreed and held that the

11

penalty action was precluded (see 303 U.S. at 396).

The Court, in an opinion by Justice Brandeis, re-

versed,

The defendant in Helvering advanced three basic

arguments: (1) that the second penalty action was

barred by “res judicata” (apparently used in a broad

sense as including collateral estoppel, see 303 U.S. at

397); (2) that the penalty action was barred by the

Double Jeopardy Clause (id. at 398); and (8) that

the Coffey decision required preclusion (id, at 405).

The Court rejected each argument.

The res judicata and collateral estoppel arguments

were quickly dispatched by the Helvering Court. The

Court simply reversed the position taken in Coffey

and concluded that differences between the burden of

proof in criminal and civ'] actions do prevent applica-

tion of res judicata or collateral estoppel to civil suits

brought after a criminal acquittal. Compare 116 U.S.

at 448 with 303 U.S. at 397. See also United States

v. $2,500 in United States Currency, 689 F.2d 10, 15

(2d Cir. 1982) (Helvering “reject[s] the holding of

Coffey’). “The difference in degree of the burden of

proof in criminal and civil cases precludes application

of the doctrine of res judicata. The acquittal was

‘merely * * * an adjudication that the proof was not

sufficient to overcome all reasonable doubt of the guilt

of the accused.’ * * * That acquittal on a criminal

charge is not a bar to a civil action by the Govern-

ment, remedial in its nature, arising out of the same

facts on which the criminal proceeding was based has

long been settled.” Helvering v. Mitchell, supra, 308

U.S, at 897. See also One Lot Emerald Cut Stones v.

United States, 409 U.S. 282, 285 (1972) (“differ-

ence[s] in the burden of proof in criminal and civil

cases precludes application of the doctrine of collat-

eral estoppel”) ; Murphy v. United States, swpra, 272

12

U.S. at 682-633; Stone v. United States, supra, 167

U.S. at 188.

The Helvering Court similarly rejected the defend-

ant’s double jeopardy argument on the ground that

the second penalty action was civil, not criminal in

nature. “Congress may impose both a criminal and a

civil sanction in respect to the same act or omission

** *. The question for decision is thus whether [the

second action] imposes a criminal sanction.” 308 U.S.

at 8399. The Court held that “[f]orfeiture of goods or

their value or the payment of fixed or variable sums

of money” are civil sanctions because they have his-

torically been “enforcible by civil proceedings” (id.

at 400).

Finally, the Court rejected the notion that Coffey

mandated preclusion of the second suit. The Court

stated flatly that “the rule of the Coffey case ‘[does]

not apply to a situation where there ha[s] been an

acquittal on a criminal charge followed by a civil ac-

tion requiring a different degree of proof’ (808 U.S.

at 405). Therefore, as Judge Winter correctly noted

in his original dissent to the panel opinion, Coffey

bars only a “subsequent criminal forfeiture * * *

arising out of the same facts” as an earlier criminal

acquittal (App. B, infra, 28a). This is the sole as-

pect of the Coffey decision that has any continuing

vitality today. One need not, moreover, reach as far

back as Coffey for an expression of this rule. See,

e.g., Ashe v. Swenson, 397 U.S. 486, 445-447 (1970).

Thus, the crucial question in this case is not, as the

court of appeals apparently believed, whether Coffey

mandates preclusion, but rather whether 18 U.S.C.

924(d) provides a civil or criminal penalty. The

court of appeals erred in concluding that 18 U.S.C.

924(d) embodies a criminal sanction,

13

2. The lower court’s ruling that 18 U.S.C. 924(d)

provides a criminal sanction does not comport with

this Court’s decision in United States v. Ward, 448

U.S, 242 (1980), nor with the teachings of Helvering

v. Mitchell, swpra, and One Lot Emerald Cut Stones

v. United States, supra, Those decisions persuasively

demonstrate that a forfeiture action under 18 U.S.C.

924(d) is not precluced by a prior crimir.al acquittal

because the statute provides a penalty that is civil

and remedia! in nature.

Based on two rather limited considerations, the

court below concluded that 18 U.S.C. 924(d) is nei-

their “civil” ner “remedial.” The court reasoned that

18 U.S.C, 924(d) is not “civil” because it “is a part

of the ‘Penalties’ section of the law” (App. A, infra,

9a). It next concluded that there is nothing “rem-

edial” about the statute because following forfeiture

the “firearms are destroyed” (id. at 10a). See 26

U.S.C. 5872(b). This perfunctory analysis is plainly

insufficient. The fact that forfeiture is listed as a

“nenalty” is not, of course, determinative of whether

it is a civil or a criminal penalty. Moreover, the fact

that forfeited firearms are destroyed rather than re-

sold does not negate the remedial congressione! pur-

pose behind the forfeiture itself. A more balanced

and careful analysis leads to a result directly op-

posite to the one reached by the court of appeals.

“This Court has often stated that the question

whether a particular statutorily-defined penalty is

civil or criminal is a matter of statutory construc-

tion.” United States v. Ward, supra, 448 U.S. at 248.

See alao One Lot Emerald Cut Stones, supra, 409 U.S.

at 237; Helvering, supra, 303 U.S. at 399. The

Court’s inquiry in this regard has “traditionally pro-

ceeded on two levels.” United States vy. Ward, supra,

448 U.S. at 248. First, the Court has sought to

*)

sa

14

determine whether Congress “indicated either ex-

pressly or impliedly a preference for one label or the

other” (ibid.). Second, where Congress has indicated

its intention to establish a civil penalty, the Court

has inquired “whether the statutory scheme was so

punitive either in purpose or effect as to negate that

intention” (id. at 249). This analysis clearly indi-

cates the civil nature of the forfeiture provision at

issue here.

Section 924(d) does not prescribe the procedures

to be followed in effectuating a forfeiture, but rather

incorporates by reference the procedures of the In-

ternal Revenue Code. This fact alone strongly indi-

cates Congress’ intention to establish Section 924(d)

as a civil rather than a criminal penalty. Forfeitures

“have been recognized as enforcible by civil proceed-

ings since the original revenue law of 1789.” Helver-

ing, 303 U.S. at 400. The Internal Revenue Code

provides that proceedings to enforce forfeitures “shall

be in the nature of a proceeding in rem in the United

States District Court for the district where such sei-

zure is made” (26 U.S.C. 7323). In rem actions are,

by their very nature, civil proceedings, with jurisdic-

tion dependent upon seizures of a plhiysical object, in

contrast to the in personam nature of criminal ac-

tions. See Calero-Toldeo vy. Pearson Yacht Lecsing

Co., 416 U.S. 663, 684 (1974). In addition to the in

rem nature of the action, the Internal Revenue Code

provides a summary, administrative proceeding for

forfeiture of seized goods valued at $2,500 or less.

See 26 U.S.C. 7325 (requiring the filing of a claim

and posting of a bond in order to obtain judicial pro-

ceedings regarding forfeiture of goods valued at less

than $2,500). Notice of the seizure may also be pro-

vided by publication. 26 U.S.C. (& Supp. IV) 6325.

15

Such procedures plainly could not be utilized in a

criminal action.’ “That Congress provided a dis-

tinctly civil procedure for [forfeitures under 18

U.S.C. 924(d)] indicates clearly that it intended a

civil, not a criminal sanction.” Helvering, supra, 303

U.S. at 402.

The fact that civil rather than criminal procedures

apply to a Section 924(d) forfeiture is not the only

evidence that the sanction cannot be deemed a crim-

inal penalty. The legislative intent behind Section

924(d) demonstrates a broadly remedial purpose for

the sanction. The forfeiture provided by Section

924(d) is not merely punitive; it is designed to pre-

vent the circulation of firearms that have been il-

legally obtained. As the Second Circuit stated, the

statute is designed “to keep potentially dangerous

weapons out of the hands of unlicensed dealers.”

United States vy. 16,179 Moslo Italian .22 Caliber

Winlee Derringer Convertible Starter Guns, 443 F.2d

463, 466 (2d Cir.), cert. denied, 404 U.S. 983

5In line with the civil procedural rules governing forfei-

tures under 18 U.S.C. 924(d), courts have concluded that the

government need establish its case only by a preponderance

of the evidence. United States v. 86 Firearms, 623 F.2d 648,

644 (10th Cir. 1980). One district court has even concluded

that once the government has shown probable cause to justify

a forfeiture, the burden of proof shifts to the defendant.

United States v. 26 Firearms, 485 F. Supp. 549 (W.D. Pa.

1980), aff'd, 639 F.2d 777 (3d Cir. 1980). Courts have regu-

larly granted summary judgment in favor of the government

(e.g., United States v. Various Firearms, 6283 F.2d 47, 48

(7th Cir. 1975)) and routinely permit the government to

appeal from an adverse decision in a forfeiture case—some-

thing that would be impermissible if the forfeiture action

were “criminal.” See, e.g., United States v. Walters, 688

F.2d 947 (6th Cir. 1981); United States v. Seven Firearms,

682 F.2d 1276 (5th Cir. 1980).

16

(1971).° See also Lewis v. United States, 445 U.S.

55, 66 (1980). And, as noted by Judge Winter in dis-

sent (App. A, infra, 14a), the scope of Section 924 (d)

is much broader than the criminal provisions of 18

U.S.C. 922(a)(1). Section 922(a)(1) outlaws only

the completed act of engaging in the business of deal-

ing in firearms without a license. The forfeiture sanc-

tion, by contrast, reaches firearms that are merely

“intended to be used” in violation of the law. Section

924(d), therefore, is clearly a remedial sanction,

broader in scope than the separate criminal provi-

sions of the gun control act, included by Congress as

an integral part of a “carefully constructed package

of gun control legislation.” Scarborough v. United

States, 431 U.S. 563, 570 (1977); United States v.

Batchelder, 442 U.S. 114, 120 (1979).

The procedures prescribed by Congress for execut-

ing the forfeiture and the congressional purpose be-

hind the sanction all evidence Congress’ intent that

18 U.S.C. 924(d) be classified as a civil rather than

a criminal penalty. The sanction, moreover, is not

“so punitive either in purpose or effect as to negate

that intention” (United States v. Ward, supra, 448

U.S. at 249). We recognize that a forfeiture proceed-

ing is frequently labeled quasi-criminal because its

object, like that of a criminal prosecution, is to

penalize through the civil process the commission of

an offense against the law. One 1958 Plymouth Sedan

v. Pennsylvania, 380 U.S. 6938, 700 (1965), citing

Boyd vy. United States, 116 U.S. 616, 633-634 (1886).

But, as this Court recently explained, a forfeiture

*Thus, rather than evidencing a punitive intent, as the

court below apparently concluded (App. A, infra, 10a), the

fact that forfeited firearms are destroyed furthers the broad

remedial purposes of federal gun control legislation. See

26 U.S.C. 5872(b).

17

proceeding is not “ ‘so far criminal in [its] nature’ ”

as to engage all the “procedural guarantees normally

associated with criminal prosecutions” (United States

v. Ward, supra, 448 U.S. at 251-255, quoting Hepner

v. United States, 213 U.S. 108, 112 (1909)). The

sanction in this case is no more criminal than the

forfeiture at issue in One Lot Emerald Cut Stunes

(see 409 U.S. at 232) or the stiff monetary penalty

involved in Helvering (see 303 U.S. at 400). The

court below therefore erred in applying the preclu-

sion rule announced in Coffey, inasmuch as that rule

has no application except to criminal sanctions sought

after a criminal acquittal. Helvering, supra, 303 U.S.

at 405; Ashe v. Swenson, supra, 397 U.S. at 445-447."

3. The decision below not only disregards con-

trolling Supreme Court precedent, it also conflicts

with the conclusion of six other circuits that 18

U.S.C. 924(d) embodies a civil sanction. United

States v. 16,175 Moslo Italian .22 Caliber Winlee

Derringer Convertible Starter Guns, supra, 443 F.2d

at 466; United States v. Seven Firearms, 632 F.2d

1276, 1278 (5th Cir. 1980) ; United States v. Walters,

supra, 638 F.2d at 950; United States v. Various

Firearms, 523 F.2d 47, 48 (7th Cir. 1975); Glup

v. United States, supra, 523 F.2d at 561; United

States v. 86 Firearms, 623 F.2d 648, 644 (10th Cir.

1980). As the Eighth Circuit stated in Glup: “It is

well established that a forfeiture proceeding under 18

U.S.C. 924(d) is remedial in nature and is properly

7 While the court below did not purport to rest its deci-

sion on double jeopardy grounds, we note that this Court

has held that a forfeiture action may be brought following a

criminal conviction, indicating that double jeopardy concerns

are not the foundation for the Coffey rule. See Various Items

of Personal Property v. United States, 282 U.S. 577 (1981).

See also United States v. Ward, supra, 448 U.S. at 258.

18

characterized as a civil proceeding’ (523 F.2d at

561). Thus, that court concluded that a forfeiture

action under Section 924(d) would not be barred by

a prior criminal acquittal (523 F.2d at 561). At

least one district court has likewise held that a for-

feiture under 18 U.S.C. 924(d) may follow an acquit-

tal on related criminal gun control charges. United

States v. One Assortment of 12 Rifles and 21 Hand-

guns, 313 F. Supp. 641, 642 (N.D. Fla. 1970).

The decision of the court of appeals necessarily

rests on the erroneous conclusion that an ostensibly

civil forfeiture penalty is in reality a criminal sanc-

tion. Forfeitures, however, have long been recog-

nized by this Court as enforcible by civil proceedings.

“In spite of their comparative severity, such sanc-

tions have been upheld against the contention that

they are essentially criminal and subject to the pro-

cedural rules governing criminal prosecutions.” Hel-

vering, supra, 303 U.S. at 400. See also United

States v. Regan, 232 U.S. 37 (1914) (tracing the

civil nature of forfeitures back to the earliest days

of this country). Review by this Court is warranted

in order to preserve the clarity that this area of the

law requires.°

* Unless the error of the lower court is corrected, litigants

in the Fourth Circuit and elsewhere will be unsure as to

whether civil procedures still contro] forfeiture actions under

18 U.S.C. 924(d). See generally note 5, supra. Absent clari-

fication by this Court, even convicted defendants may assert

that a forfeiture action following conviction is barred by

double jeopardy considerations. But see Various Items of

Personal Property v. United States, 282 U.S. 577 (1981)

(permitting forfeiture action following criminal conviction).

It is even possible that the rationale of the court of appeals’

decision would require application of the Federal Rules of

19

CONCLUSION

The petition for a writ of certiorari should be

granted.

Respectfully submitted.

Rex E. LEE

Solicitor General

D. LOWELL JENSEN

Assistant Attorney General

ANDREW L. FREY

Deputy Solicitor General

RICHARD G. WILKINS

Assistant to the Solicitor General

SIDNEY M. GLAZER

Attorney

DECEMBER 1982

Criminal Procedure to all forfeiture proceedings based on a

violation of federal criminal law. See, e.g., Fed. R. Crim. P.

7(c) (2), 81(e), 82(b) (2) (specifying procedural require-

ments for “criminal” forfeitures).

la

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 81-1055

UNITED STATES OF AMERICA, APPELLEE

Vv.

ONE ASSORTMENT OF FIREARMS, APPELLANT

NATIONAL RIFLE ASSOCIATION OF AMERICA,

AMICUS CURIAE

Appeal from the United States District Court

for the District of South Carolina, at Columbia

Charles E. Simons, Jr., District Judge

Argued: June 8, 1982 Decided: August 238, 1982

Before WINTER, Chief Judge, BUTZNER, RUSSELL,

HALL, PHILLIPS, MURNAGHAN, SPROUSE, ERVIN and

CHAPMAN, Circuit Judges, sitting en banc.

CHAPMAN, Circuit Judge

This is an appeal from a judgment ordering for-

feiture under 18 U.S.C. §$924(d) of 80 firearms

seized from the home of Patrick Muleahey, who was

alleged to have been a dealer in firearms without a

license. Mulcahey had previously been indicted for

unlawfully and knowingly engaging in the business

of dealing in firearms without a license in violation

of 18 U.S.C. § 922(a)(1). Finding that Mulcahey’s

acquittal on the criminal charge is a bar to the for-

feiture, we reverse.

On January 20, 1977, an assortment’ of firearms

was seized by agents of the Bureau of Alcohol, To-

bacco and Firearms. Following an indictment under

18 U.S.C. § 922(a) (1), Muleahey was tried by a jury

and on March 16, 1977 was acquitted of the charge.

The present action in rem against the same assort-

ment of firearms was initiated on March 31, 1977 by

service of a complaint seeking forfeiture pursuant to

18 U.S.C. § 924(d). Muleahey, as claimant, filed a

claim for recovery of the firearms and also filed an

answer to the complaint. The parties entered into a

stipulation that the transcript in the criminal trial

of United States v. Mulcahey, No. 77-00013, would be

submitted to the court in lieu of testimony. Upon

motion of the United States prior to trial, the district

court struck Mulcahey’s second defense of collateral

estoppel, res judicata and the bar to the present pro-

ceedings of the jury verdict in No, 77-00013. Upon

trial of the forfeiture the same firearms which had

been seized by the ATF and used by the United States

Attorney as evidence in the criminal action were

again introduced into evidence. The district court or-

dered a forfeiture of 80 of the firearms. The court

concluded :

1The number of firearms in the assortment has varied

from time to time as the agents of ATF and the United States

returned certain firearms admittedly belonging to other per-

sons and the district court in its final order directed that

certain firearms be returned to owners other than Mulcahey.

8a

. . » [T]he firearms here in question were in-

volved in, used and intended to be used in viola-

tion of 18 U.S.C. §922(a)(1). Such firearms

are rendered subject to forfeiture under 18

U.S.C. §924(d), which forfeiture is hereby

ordered.

The court found that these firearms were used by

Mulcahey from May 13, 1976 to January 20, 1977,

while Muleahey was engaged in the business of deal-

ing in firearms without being properly licensed. The

criminal indictment against Muleahey charged him

with being engaged in the business of dealing in fire-

arms without being licensed to do so from on or about

May 12, 1976, up to the return of the indictment on

January 19, 1977.

Mulcahey seeks return of the firearms upon the

ground that the jury verdict in the criminal action

conclusively settled the issue that he was not en-

gaged in the business of dealing in firearms without

a license, and he contends that the present action is

barred by the holding in Coffey v. United States, 116

U.S. 486 (1886). We agree.

Coffey was tried on a criminal charge of violating

the revenue laws of the United States by operating

a distillery without payment of the required taxes.

He was acquitted on this charge, and shortly there-

after the United States sought forfeiture of the dis-

tilling equipment. Coffey raised the prior acquittal

as a bar to the forfeiture action, and the Supreme

Court agreed, stating at page 442:

The principal question is as to the effect of the

indictment, trial, verdict and judgment of ac-

quittal set up in the fourth paragraph of the an-

swer. The information is founded on sections

8257, 3450 and 3453; and there is no question,

4a

on the averments in the answer, that the fraudu-

lent acts and attempts and intents to defraud,

alleged in the prior criminal information, and

covered by the verdict and judgment of acquittal,

embraced all of the facts, attempts and intents

averred in the information in this suit.

The question, therefore, is distinctly presented,

whether such judgment of acquittal is a bar to

this suit. We are of the opinion that it is.

At 448 the Court stated:

Yet, where an issue raised as to the existence of

the act or fact denounced has been tried in a

criminal proceeding, instituted by the United

States, and a judgment or acquittal has been

rendered in favor of a particular person, that

judgment is conclusive in favor of such person, on

subsequent tria! of a suit in rem by the United

States, where, as against him, the existence of the

same act or fact is the matter in issue, as a cause

for the forfeiture of the property prosecuted in

such suit in rem. It is urged as a reason for not

allowing such effect to the judgment, that the ac-

quittal in the criminal case may have taken place

because of the rule requiring guilt to be proved

beyond a reasonable doubt; and that, on the same

evidence, on the question of preponderance of

proof, there might be a verdict for the United

States, in the suit in rem. Nevertheless, the fact

or act has been put in issue and determined

against the 'Inited States; and all that is im-

posed by the statute, as a consequence of guilt,

is a punishment therefor. There could be no new

trial of the criminal prosecution after the ac-

quittal in it; and a subsequent trial of the civil

suit amounts to substantially the same thing,

with a difference only in the consequences follow-

ing a judgment adverse to the claimant,

Coffey was acquitted on a charge of operating a

still without paying the necessary tax thereon and

could raise this acquittal as a bar to action for for-

feiture of the distilling equipment. Muleahey was ac-

quitted on a charge of being engaged in the business

of dealing in firearms without a license and can raise

this acquittal as a bar to the present forfeiture action

involving the 89 firearms, since a jury has already

found that these 89 firearms were not being used by

Mulcahey in the business of dealing in firearms with-

out a license.

The government argues that the present action is

controlled by One Lot Emerald Cut Stones and One

Ring v, United States, 409 U.S, 282 (1972), in

which the court held that forfeiture of the ring and

stones was not barred by the owner’s acquittal on

charges of violating 18 U.S.C, § 545 which covers

willfully and knowingly, with intent to defraud the

United States, smuggling articles into the United

States without submitting the same to required cus-

toms procedures, The court found that the second

action was not barred because the essential elements

of proof in the two actions were not the same, In the

criminal action it was necessary to prove a knowing

and willful intent to defraud the United States, which

was not required in the forfeiture. The court was

careful to point out that if the elements of proof

were the same then the government would be barred.

At page 234 the court stated:

Collateral estoppel would bar a forfeiture under

§ 1497 if, in the earlier criminal proceeding, the

elements of a § 1497 forfeiture had been resolved

against the government. Ashe v. Swenson, 397

U.S. 486, 448 (1970).

In Muleahey’s criminal proceeding the elements of the

present forfeiture were all resolved against the yov-

ernment, so the present action is barred by collateral

estoppel.

One Lot Emerald Cut Stones did not overrule Cof-

fey. The court in One Lot Emerald Cut Stones, at

footnote 5 distinguished the two cases as follows:

The difference in the issues involved in the crim-

inal proceeding, on the one hand, and the forfeit-

ure action, on the other, serves to distinguish

Coffey v. United States, 116 U.S. 486 (1886),

relied upon by the District Court in the present

case. Coffey involved a forfeiture action com-

menced after an acquittal. This Court noted, in

holding the forfeiture barred, that “[t]he infor-

mation [for forefeiture] is founded on §§ 3257,

3450 and 34538; and there is no question, on the

averments in the answer, that the fraudulent acts

and attempts and intents to defraud, alleged in

the prior criminal information, and covered by

the verdict and judgment of acquittal, embraced

all of the acts, attempts and intents averred in

the information in this suit.” /d. at 442. The

Court specifically distinguished the situation

where “a certain intent must be proved to support

the indictment, which need not be proved to sup-

port the civil action.” Jd, at 448. See also Stone

v. United States, 167 U.S, 178 (1897),

The present case is not controlled by One Lot Emerald

Cut Stones. The stones which were the subject of the

forfeiture in that case became contraband and sub-

ject to seizure once they came into the United States

Ta

without payment of the required duty. The crimin,

action for alleged smuggling of these stones proved

only that the holder of the stones did not knowingly

with the intent to defraud the United States smuggle

the articles into the country. Intent to defraud was

not an issue in the later forfeiture proceeding and did

not need to be proved, because the stones were admit-

tedly in the United States without being subjected to

required customs proceedings and as a result were

contraband, subject to seizure. Firearms are not

contraband and are not subject to seizure unless they

are used or intended to be used in violation of the

Gun Control Act, This issue of whether the firearms

were used or intended to be used in violation of the

Act was tried in No, 77-00018 and conclusively de-

cided, The government now wishes to relitigate the

same issue hoping for a different result.

To support a conviction under 18 U.S.C. § 922(a)

the government must prove two essential elements:

First, that the defendant, between the dates specified

in the indictment, engaged in the business of dealing

in firearms (or ammunition) ; and second, that at the

time he engaged in that business he was not a li-

censed importer, licensed manufacturer, or licensed

dealer in firearms, 2 Devitt and Blackmar, Federal

Jury Practice and Instructions § 59.10,

The same two essential elements must be proved in

the forfeiture action. The same firearms that were

introduced into evidence in the criminal action are the

subject of the forfeiture action, The United States

had its day in court on these identical issues in the

criminal proceeding and is collaterally estopped by

the verdict in that case from pursuing the matter in

this forfeiture action,

<—

ca

Title 18, U.S.C. § 924(d) states:

Any firearm or ammunition involved in or used

or intended to be used in the violation of any of

the provisions of this chapter or any rule or regu-

lation promulgated thereunder, or any violation

of any other criminal law of the United States,

shall be subject to seizure and forfeiture... .

(Emphasis added)

The criminal verdict conclusively decided that the

firearms in question were not “involved in or used or

intended to be used in the violations of any provision

of this chapter.”

The government, in addition to One Lot Emerald

Cut Stones, relies upon Glup v. United States, 523

F.2d 557 (8th Cir, 1975), Epps v. Bureau of Alco-

hol, Tobacco, and Firearms, 357 F.Supp. 345 (E.D.

Tenn. 1978) and United States v. One (1) 1969

Buick Riviera Automobile, 493 F.2d 553 (5th Cir.

1974). This reliance is misplaced. In Glup the fire-

arms were seized on June 8, 1970 and declared for-

feited on August 11, 1970, because Glup had taken

no action to contest the seizure and forfeiture. Two

years later Glup was indicted on three counts charg-

ing violation of 18 U.S.C, § 922(a) and three counts

charging him with violation of 18 U.S.C. App. § 1202.

The forfeited firearms were used in evidence at the

trial on these charges, but none of the six counts in-

volved firearms included in the June 8, 1977 seizure.

Glup was acquitted on all six counts by a jury. In

Glup the forfeiture preceded the criminal acquittal,

and the charges contained in the indictment did not

involve the firearms which had been declared for-

feited.

In Epps the plaintiff was seeking return of certain

firearms and ammunition which had been seized and

9a

used against him in a criminal proceeding based upon

18 U.S.C. § 922(a), but the court did not mention the

United States Supreme Court decision of Coffey v.

U.S., which was still good law as evidenced by foot-

note 5 in One Lot Emerald Cut Stones, a case decided

in 1972, the year prior to the Epps decision.

In One (1) 1969 Buick Riviera Automobile, the in-

dividual was charged with importing marijuana, but

the criminal charges were dismissed prior to trial,

and the Fifth Circuit was careful to point out that no

issue had been actually litigated by the dismissal of

the prior criminal charge and, therefore, Coffey did

not apply.

The government argues that this forfeiture is a

civil proceeding and as such is not barred by the jury

verdict in the criminal case. The present forfeiture is

criminal in nature and the prior jury verdict is a bar

to the present proceeding.

In Boyd vy. United States, 116 U.S. 116 (1885)

(decided in the same term as Coffey) the court con-

cluded :

We are also clearly of the opinion that proceed-

ings instituted for the purpose of declaring a

forfeiture of a man’s property by reason of of-

fenses committed by him, though they may be

civil in form, are in their nature criminal. Page

633, 634.

The present forfeiture is for offenses allegedly com-

mitted by Mulcahey, who has been found innocent of

these charges.

The forfeiture provision set forth in § 924(d) is a

part of the “Penalties” section of the law. Everything

in § 924 provides a penalty, be it fine, prison or for-

feiture, for the violation of a provision of the Gun

10a

Control Act. The forfeiture provision is merely a way

of disposing of the firearms which have been used in

violation of the Act, after there is a conviction of

such violation. Forfeiture is a penalty suffered by a

defendant in addition to a fine and/or imprisonment.

If Muleahey had been convicted, he could have been

fined and/or imprisoned and would have lost all of

his firearms under § 924(d). But he was acquitted on

the charge of being a gun dealer without a license.

However, the government still wishes to invoke the

penalty of § 924(d). Mulcahey would thereby be sub-

ject to the same penalty of losing his property for an

activity for which he had been found not guilty.

Helvering vy. Mitchell, 303 U.S. 391 (1938) is not

controlling. It involved assessment of a penalty for

tax fraud after acquittal of a charge of willful eva-

sion. The court held, at 399, that the question was

one of statutory construction, that is whether Con-

gress intended to punish criininals twice for the same

offense. The court went or. to find that the civil fraud

penalty was remedial in character and was “. . . pro-

vided primarily as a safeguard for protection of the

revenue and to reimburse the Government for the

Seavy expense of investigation and loss resulting

trom the taxpayer’s fraud.” Id. at 401.

There is nothing remedial about forfeiture under

§924(d). The firearms do not go into the public

treasury to offset the expense of operating the ATF.

These firearms are destroyed.

Marcus v. Hess, 317 U.S. 5387 (1948) involved a

claim of defrauding the United States through a de-

vice of collusive bidding on P.W.A. projects in the

Pittsburg area. The defendants were indicted for de-

frauding the government and upon a plea of nolo

contendere were fined $54,000. Thereafter the pres-

lla

ent action was brought under a qui tam statute which

allowed a suit to be brought by an informer in the

name of the United States. The informer would re-

ceive half of the amount of the recovery, which re-

covery would include double the amount of damages

sustained and the sum of $2,000 for each violation.

Marcus is not applicable because the defendant pled

guilty and was not acquitted. Also, the $2,000 added

to the double damages is simply a way of establishing

damages in a civil action, similar to treble damages

under the antitrust law, and does not represent a sec-

ond fine.

Rex Trailer Co. v. United States, 350 U.S. 148

(1955) also involved a defendant who had pled nolo

contendere to a five count indictment of fraudulently

purchasing motor vehicles from the United States

under the Surplus Property Act of 1944. He was

fined $25,000 in criminal court and objected on the

grounds of double jeopardy to a civil penalty under

the Act which provided that every person engaged in

any fraudulent trick or scheme to obtain property

from the United States should pay the United States

the sum of $2,000 for each act and double the amount

of any damage to the United States. Section 26 of the

Surplus Property Act, 58 Stat. 765, 780, 50 U.S.C.

App. (1946 ed.) §1635(d) provided: “The civil

remedies provided in this section shall be in addition

to all other criminal penalties and civil remedies pro-

vided by law.”

Obviously Congress intended for, there to be a crim-

inal and a civil remedy for vislating the Surplus

Property Act. There is no such intent evidenced by

Congress for a violation of the Gun Control Act. The

forfeiture provision is contained in the same section

with the criminal penalties.

12a

There are no civil remedies contained in § 924, or

anywhere else in the Gun Control Act.

For the reasons set forth above, the court concludes

that the acquittal in the prior criminal action involv-

ing the identical facts and essential elements is a bar

to the present forfeiture proceeding. Therefore, the

judgment of the district court is

REVERSED.

l3a

WINTER, Chief Judge, with whom BUTZNER, RUS-

SELL, and MURNAGHAN join, dissenting:

We respectfully dissent for the reasons set forth

in the dissent to the panel opinion, United States v.

One Assortment of 89 Firearms, 669 F.2d 206, 210-13

(4 Cir. 1982), and the additional reasons which

follow.

In oral argument before us, counsel for Mulecahey

conceded that he asserted entrapment as a defense in

his trial for violation of 18 U.S.C. § 922(a)(1), and

that defense was submitted to the jury. Of course, in

returning a verdict of not guilty, the jury did not

specify the grounds of acquittal, but it is equally pos-

sible that the jury found that Mulcahey was engaged

in the business of dealing in firearms without a li-

cense, but had been entrapped into committing an

illegal sale, as found that Mulcahey was not so en-

gaged. Thus in our view, the majority errs when it

confidently asserts that the jury verdici in the crimi-

nal action conclusively settled the issue that Mulcahey

was not engaged in the business of dealing in fire-

arms without a license.

But irrespective of the factual issue of Mulcahey’s

guilt or innocence, we remain convinced that the for-

feiture provisions of 18 U.S.C. § 924(d) are civil in

nature so that any determination in the criminal

prosecution is irrelevant to a decision of forfeiture.

Our conclusion is reinforced by the language of that

subsection. It states disjunctively that “[a]ny fire-

arm involved in or used or intende!’ to be used in,

any violation of this chapter . . . shall be subject to

seizure and forfeiture .. .” (emphasis added). 7d.

Nothing in the provision of § 922 under which Mul-

cahey was prosecuted renders an intention to engage

in the business of dealing in firearms without a li-

l4a

cense illegal.* Only the completed act of engaging in

the prohibited business is rendered unlawful. It is

at once apparent that the forfeiture provisions of the

Act were intended by Congress to be broader in scope

than the criminal sanctions. This is persuasive evi-

dence that Congress did no: intend forfeitures to be

an additional penalty for the commission of a crimi-

nal act but rather that they be a separate civil sanc-

tion, remedial in nature.

We would affirm the judgment of the distvict court.

* While the majority asserts that the “issue of whether

the firearms were used or intended to be used in violation

of the Act was tried .. . and conclusively decided” (emphasis

added) in the earlier criminal case, the emphasized portion

of that statement lacks record support. Mulcahey was indicted

and acquitted for a violation of 18 U.S.C. § 922(a) (1) which

provides:

(a) It shall be unlawful—

(1) for any person, except a licensed importer,

licensed manufacturer, or licensed dealer, to engage

in the business of importing, manufacturing, or deal-

ing in firearms or ammunition, or in the course of

such business to ship, transport, or receive any fire-

arm or ammunition in interstate or foreign com-

merce.

Manifestly the question of whether Mulcahey intended to

use the firearms he possessed in violation of the statute was

neither an issue nor was it decided in his criminal trial.

l5da

APPENDIX B

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 81-1055

UNITED STATES OF AMERICA, APPELLEE

Vv.

ONE ASSORTMENT OF 89 FIREARMS, APPELLANT

NATIONAL RIFLE ASSOCIATION OF AMERICA,

AMICUS CURIAE

Appeal from the United States District Court

for the District of South Carolina, at Columbia.

Charles E. Simons, Jr., District Judge

Argued: November 3, 1981 Decided: January 26, 1982

Before WINTER, Chief Judge, FIELD, Senior Cir-

cuit Judge and CHAPMAN, Circuit Judge.

CHAPMAN, Circuit Judge

An action for forfeiture was brought by the United

States of America against 89 (originally 92) fire-

arms it seized under a search warrant of the premises —

of Patrick M. Mulcahey. Paragraph 6 of the com-

plaint seeking forfeiture alleges:

l6a

That said firearms were had and possessed and

used and intenced to be used on January 20,

1977, and prior thereto by Patrick M. Mulcahey

in Richland County, South Carolina, in violation

of the laws of the United States by engaging in

the business of a dealer in firearms and ammuni-

tion without the said Patrick M. Mulcahey hav-

ing first applied for and received a license as a

dealer in firearms and ammunition as required

by 18 U.S.C. 923(a); and said firearms having

been used and intended to be used and involved in

said unlicensed firearms business in violation of

18 U.S.C. 922(a)(1) and 9238(a), thereby be-

came forfeited to the United States under the

provisions of 18 U.S.C. 924(d).

The same 89 firearms were introduced as exhibits in

Criminal Action 77-00013 brought in the United

States District Court for the District of South Car-

olina by the United States of America against Patrick

M. Mulcahey under an indictment charging that he

unlawfully and knowingly engaged in the business of

dealing in firearms without being licensed in violation

of 18 U.S.C. § 922(a) (1) and § 924(a). The criminal

case was tried before a jury and resulted in a not

guilty verdict: on March 16, 1977.

This not guilty criminal verdict was raised as a

defense in the forfeiture action, but upon motion of

the United States the defense was stricken from de-

fendant’s answer. The forfeiture action was then

tried without a jury, and the Court concluded:

. .. [T]he firearms here in question were in-

volved in, used or intended to be used in viola-

tion of 18 U.S.C. §922(a)(1). Such firearms

are rendered subject to forfeiture under 18

U.S.C. §924(d), which forfeiture is hereby

ordered

17a

In connection with this conclusion, the Court found

that these firearms were used by Patrick M. Mul-

cahey from May 13, 1976, to January 20, 1977, while

Mulcahey was engaged in the business of dealing in

firearms without being properly licensed. The crim-

inal indictment against Mulcahey charged him with

being engaged in the business of dealing in firearms

without being licensed to do so from on or about May

12, 1976, up to the return of the indictment on Jan-

uary 19, 1977.

Mulcahey, the claimant in the present action, seeks

return of the 89 firearms upon the ground that the

jury verdict in the criminal action conclusively settled

the issue that he was not engaged in the business of

dealing in firearms without a license, so the firearms

could not have been used by him while engaged in such

a business without a license.

Mulcahey contends that the present action is barred

by the holding in Coffey v. U.S., 116 U.S 436, 6 S.

Ct. 437, 29 L.Ed. 684 (1886). We agree.

Coffey was tried on a criminal charge of violating

the revenue laws of the United States by operating a

distillery without payment of the required taxes. He

was acquitted on this charge, and shortly thereafter

the United States sought forfeiture of the distilling

equipment. Coffey raised the prior acquittal as a bar

to the forfeiture action and the Supreme Court agreed

stating at page 442:

The principal question is as to the effect of the

indictment, trial, verdict and judgment of acquit-

tal set up in the fourth paragraph of the answer.

The information is founded on sections 3257,

3450 and 3453; and there is no question, on the

averments in the answer, that the fraudulent

acts and attempts and intents to defraud, alleged

184

in the prior criminal information, and covered by

the verdict and judgment of acquittal, embraced

all of the acts, attempts and intents averred in

the information in this suit.

The question, therefore, is distinctly presented,

whether such judgment of acquittal is a bar to

this suit. We are of opinion that it is.

At 443 the Court stated:

Yet, where an issue raised as to the existence of

the act or fact denounced has been tried in a

criminal proceeding, instituted by the United

States, and a judgment of acquittal has been ren-

dered in favor of a particular person, that judg-

ment is conclusive in favor of such person, on

subsequent trial of a suit in rem by the United

States, where, as against him, the existence of

the same act or fact is the matter in issue, as a

cause for the forfeiture of the property prose-

cuted in such suit in rem. It is urged as a rea-

son for not allowing such effect to the judgment,

that the acquittal in the criminal case may have

taken place because of the rule requiring guilt to

be proved beyond a reasonable doubt; and that, on

the same evidence, on the question of prepon-

derance of proof, there might be a verdict for the

United States, in the suit in rem. Nevertheless,

the fact or act has been put in issue and de-

termined against the United States; and all that

is imposed by the statute, as a consequence of

guilt, is a punishment therefor. There could be no

new trial of the criminal prosecution after the

acquittal in it; and a subsequent trial of the civil

suit amounts to substantially the same thing, with

a difference only in the consequences following a

judgment adverse to the claimant.

19a

Coffey was acquitted on a charge of operating a

still without paying the necessary tax thereon and

could raise this acquittal as a bar to an action for

forfeiture of the distilling equipment. Mulcahey was

acquitted on a charge of being engaged in the business

of dealing in firearms without a license and can raise

this acquittal as a bar to the present forfeiture action

involving the 89 firearms, since a jury has already

fourid that these 89 firearms were not being used by

Muleahey in the business of dealing in firearms

without a license.

The government argues that the present action is

controlled by One Lot Emerald Cut Stones and One

Ring v. United States, 409 U.S. 232 (1972), in which

the Court held that forfeiture of the ring and stones

was not barred by the owner's acquittal on charges of

violating 18 U.S.C. §545 which covers willfully and

knowingly, with intent to defraud the United States,

smuggling articles into the United States without

submitting the same to required customs procedures.

The Court found that the second action was not barred

because the essential elements of proof in the two ac-

tions were not the same. In the criminal action it

was necessary to prove a knowing and willful in-

tent to defraud the United States, which was not re-

quired in the forfeiture. The Court was careful to

point out that if the elements of proof were the same

then the government would be barred. At page 234

the Court stated:

Collateral estoppel would bar a forfeiture under

§ 1497 if, in the earlier criminal proceeding, the

elements of a § 1497 forfeiture had been resolved

against the government. Ashe v. Swenson, 397

U.S. 486, 443 (1970).

20a

In Mulcahey’s criminal proceeding the elements of the

present forfeiture were all resolved against the gov-

ernment, so the present action is barred by collateral

estoppel.

One Lot Emerald Cut Stones did not overrule Cof-

fey. The One in One Lot Emerald Cut Stones, at

footnote 5 distinguished the two cases as follows:

he difference in the issues involved in the crim-

inal proceeding, on the one hand, and the forfeiture

action, on the other, serves to distinguish Coffey

v. United States, 116 U.S. 436 (1886), relied

upon by the District Court in the present case.

Coffey involved a forfeiture action commenced

after an acquittal. This Court noted, in holding

the forfeiture barred, that “[t]he information

[for forfeiture] is founded on §§ 3257, 3450 and

8453; and there is no question, on the averments

in the answer, that the fraudulent acts and at-

tempts and intents to defraud, alleged in the

prior criminal information, and covered by the

verdict and judgment of acquittal, embraced all

of the acts, attempts and intents averred in the

information in this suit.” /d., at 442. The Court

specifically distinguished the situation where “a

certain intent must be proved to support the in-

dictment, which need not be proved to support the

civil action.” IJd., at 443. See also Stone v. United

States, 167 U.S. 178 (1897).

To support a conviction under 18 U.S.C, § 922(a)

the government must prove two essential elements:

First: that the defendant, between the dates specified

in the indictment, engaged in the business of dealing

in firearms (or ammunition); and second: that at

the time he engaged in that business he was not a

2la

licensed importer, licensed manufacturer, or licensed

dealer in firerms. 2 Devitt and Blackmar, Federal

Jury Practice and Instructions § 59.10.

The same two essential elements must be proved

in the forfeiture action. The same firearms that were

introduced into evidence in the criminal action are the

subject of the forfeiture action. The United States

had its day in court on these identical issues in the

criminal proceeding and is collaterally estopped by the

verdict in that case from pursuing the matter in this

forfeiture action.

Title 18, U.S.C. § 924(d) states:

Any firearm or ammunition involved in or used

or intended to be used in the violation of any of

the provisions of this chapter or any rule or reg-

ulation promulgated thereunder, or any violation

of any other criminal law of the United States,

shall be subject to seizure and forfeiture...

(Emphasis added )

The criminal verdict conclusively decided that the

firearms in question were not “involved in or used or

intended to be used in the violations of any provision

of this chapter.”

The government, in addition to One Lot Emerald

Cut Stones, relies upon Gulp v. United States, 523

F.2d 557 (8th Cir. 1975), Epps v. Bureau of Alcohol,

Tobacco, and Firearms, 357 F.Supp. 345 (E.D. Tenn.

1973) and United States v. One (1) 1969 Buick

Riviera Automobile, 493 F.2d 538 (5th Cir. 1974).

This reliance is misplaced. In Gulp the firearms were

seized on June 8, 1970 and declared forfeited on

August 11, 1970, because Gulp had taken no action to

contest the seizure and forfeiture. Two years later

Gulp was indicted on three counts charging violation

22a

of 18 U.S.C. § 922(a) and three counts charging him

with violation of 18 U.S.C. App. § 1202. The for-

feited firearms we:e used in evidence at the trial on

these charges, but none of the six counts involved

firearms included in the June 8, 1977 seizure. Gulp

was acquitted on all six counts by a jury. In Gulp the

forfeiture preceded the criminal acquittal and the

charges contained in the indictment did not involve

the firearms which had been declared forfeited.

In Epps the plaintiff was seeking return of certain

firearms and ammunition which had been seized and

used against him in a criminal proceeding based upon

18 U.S.C, § 922(a), but the Court did not mention

the United States Supreme Court decision of Coffey

v. U.S., which was still good law as evidenced by

footnote 5 in One Lot Emerald Cut Stones, a case de-

cided in 1972, the year prior to the Epps decision.

In One (1) 1969 Buick Riviera Automobile, the

individual was charged with importing marijuana, but

the criminal charges were dismissed prior to trial, and

the Fifth Circuit was careful to point out that no is-

sue had been actually litigated by the dismissal of the

prior criminal charge and, therefore, Coffey did not

apply.

For the reasons set forth above, the Court concludes

that the acquittal in the prior criminal action involv-

ing the identical facts and essential elements is a

bar to the present forfeiture proceeding. Therefore,

the judgment of the district court is

REVERSED.

23a

WINTER, Chief Judge, dissenting:

In this appeal, the claimant contends that the for-

feiture is barred by his acquittal on the earlier crim-

inal charges. This conclusion is required, he asserts,

by both the double jeopardy clause and the doctrine of

res judicata because the forfeiture is criminal in

nature. Even if the forfeiture is deemed to be civil in

nature, he continues, it is barred by the doctrine of

collateral estoppel. Based upon its reading of coffey

v. United States, 116 U.S. 436 (1886), the majority

holds that the forfeiture is barred. I concede that Cof-

fey hold that a subsequent criminal forfeiture is barred

by an earlier acquittal on criminal charges arising out

of the same facts and that this aspect of Coffey is vi-

able today. I think, however, that more recent Su-

preme Court decisions compel the conclusion that the

forfeiture in the present case is civil and that the

doctrine of collateral estoppel is inapplicable because

the standards of proof in criminal and civil pro-

ceedings are different. I therefore respectfully

dissent.

I.

In a pair of early cases, the Supreme Court held

that nominally civil penalty proceedings brought sub-

sequent to criminal proceedings based on the same al-

legations were barred by the double jeopardy clause.

See United States v. Ulrici, 102 U.S. 612 (1881);

United States v. Chouteau, 102 U.S. 603 (1881).

And in Coffey, the Supreme Court ignored the double

jeopardy argument but nonetheless held that a sub-

sequent forfeiture proceeding was barred, relying

upon some nonconstitutional doctrine of preclusion.

From a reading of Coffey, one cannot be certain

whether or not the Court deemed the forfeiture pro-

ceeding to be criminal in nature, and thus whether

24a

the decision was based on res judicata (if so) or on

collateral estoppel (if not). See 1B J. Moore & T.

Currier, Moore’s Federal Practice § 418[8], at 2855

&n.13 (2d ed. 1980).

It is commonly asserted that a criminal acquittal

cannot collaterally estop a contrary finding on ony

issues in a later civil proceeding because of the differ-

ing standards of proof involved. See, eg., 18 C.

Wright, A. Miller & E, Cooper, Federal Practice and

Procedure § 4474, at 757 (1981). Logically, the fact

that X was not shown beyond a reasonabie doubt does

not rule out the possibility that X can be shown by a

preponderance of the evidence. To the extent that the

Coffey decision rested on collateral estoppel (i.e., to

the extent that the Court held that the forfeiture pro-

ceeding was barred even if civil in nature), the Court

was rejecting this standard of proof argument.

Subsequent Supreme Court cases, however, inter-

preted Coffey as being based on a belief that the for-

feiture there at issue—a forfeiture of illegal liquor—

was criminal in nature. See Helvering v. Mitchell, 303

U.S. 391, 405-06 (19388); Murphy y. United States,

272 U.S. 630, 631-32 (1926); Stone v. United States,

167 U.S. 178, 186-87 (1897). And in all three of

these cases, the Court very clearly indicated that if

the forfeiture proceeding is civil in nature, the stand-

ard of proof argument, by itself, is enough to defeat

any resort to collateral estoppel. See Helvering v.

Mitchell, supra, 303 U.S. at 397 (using “res judicata”

in the broad sense, encompassing collateral estoppel) ;

Murphy v. United States, swpra, 272 U.S. at 632-33;

Stone v. United States, swpra, 167 U.S. at 188. In-

deed, the rejection of the collateral estoppel argument

was so complete that the petitioners in United States

ex rel. Marcus v. Hess, 317 U.S. 587 (1943), and Rex

Trailer Co. v. United States, 350 U.S. 148 (1956),

25a

did not even press it, confining themselves instead to

arguing that the subsequent proceeding was criminal

in nature. The collateral estoppel argument was

raised in One Lot Emerald Cut Stones v. United

States, 409 U.S. 282 (1972), but the Court rejected

it on two alternative grounds, First, the Court stated

that the criminal proceeding involved an issue of in-

tent not present in the forfeiture proceeding. Jd. at

234-35. Second, and more important for our purposes,

the Court stated that the difference in the standards

of proof in the two proceedings precluded applica-

tion of the doctrine of collateral estoppel. 7d. at 235.

Thus, it can be said today that “[p]roblems arise

only when it is asserted that a nominally civil action

brought by the government involves an element of

punishment that runs afoul of double jeopardy princi-

ples.” 18 C. Wright, A Miller & E. Cooper, supra,

§ 4474, at 749. Every time the Supreme Court has

faced this double jeopardy question since Coffey, it

has deemed the later proceeding to be civil in nature

and thus upheld the forfeiture or penalty. See One

Lot Emerald Cut Stones v. United States, supra, 409

U.S. at 2385-37; Rex Trailer Co. v. United States,

supra, 350 U.S. at 151-52; United States ex rel. Mar-

cus. v. Hess, supra, 317 U.S. at 548-52; Helvering v.

Mitchell, supra, 303 U.S. at 398-405; Murphy v.

United States, supra, 272 U.S. at 631-32; Stone v.

United States, supra, 167 U.S. at 187-88. The same

result has been reached in the clear majority of lower

court decisions addressing the question. See cases

cited in 1B J. Moore & T. Currier, swpra, § 418[8]

(2d ed. 1980 & 1980-81 Curh. Supp.).’

1 Coffey has never, however, been overruled. Though Coffey

has been sharply criticized, see cases cited in 1B J. Moore &

T. Currier, supra, { 418[8], at 2854 n.12 (2d ed. 1980), an

26a

Marcus is a good example of the Supreme Court’s

handling of the question. There, the Court held that

a penalty proceeding for defrauding the government

by collusive bidding did not violate the guarantee

against double jeopardy even though the defendants

had been charged and convicted for a crime based on

the same allegations. Relying upon the general princi-

ples discussed in Mitchell, which held that Congress

may impose both a criminal and civil sanction in re-

spect to the same act or omission, the Court said that

the issue in each case was a statutory one—was the

forfeiture or penalty criminal or remedial? The pen-

alty in Marcus was held to be civil—and therefore

constitutionally permissible—because its purpose was

to reimburse the government for monies of which it

had been defrauded.

One Lot developed this concept further. In that

case an acquitted smuggler contended that a nomi-

nally civil proceeding brought for the forfeiture of

the allegedly smuggled goods was actually criminal,

and thus prohibited by the double jeopardy clause.

The Court held that it was not a violation of the

double jeopardy clause to punish a wrongdoer both

criminally and civilly, and that the forfeiture was a

civil proceeding because its purpose was to aid in the

enforcement of tariff regulations by preventing

smuggled merchandise from circulating in the United

States.

occasional lower court decision follows it, deems a nominally

civil forfeiture or penalty proceeding to be criminal in nature,

and deems the forfeiture or penalty proceeding to be barred

because a criminal proceeding had previously been brought,

see cases cited in id. { 418[3], at 2851 n.1, 2856 n.16 (2d ed.

198% & 1980-81 Cum. Supp.). Most of these cases, like Coffey,

dealt with illegal liquor.

27a

ITI.

One Lot, in my view, is controlling here. The for-

feiture statute here, 18 U.S.C. § 924(d), was mani-

festly designed to aid in the enforcement of gun con-

trol laws by preventing the circulation of firearms

which had been illegally obtained. One Lot thus com-

pels the conclusion that the forfeiture at issue here is

civil in nature,’ so that the double jeopardy and res

judicata claims must be rejected. It matters not, de-

spite the majority’s views, that the necessary allega-

tions in the criminal proceeding and the forfeiture

proceeding were identical. One Lot also compels the

conclusion that the difference in the standards of proof

in the two proceedings obviates the collateral estoppel

claim.’

*Many cases have held that the preponderance-of-the-

evidence standard applies in § 924(d) forfeitures because

they are civil in nature. See, e.g., United States v. Eighty-

Six Firearms, 623 F.2d 643 (10 Cir. 1980) ; United States v.

1,922 Assorted Firearms, 330 F. Supp. 635 (E.D. Mo. 1971) ;

United States v. One Assortment of 12 Rifles, 318 F. Supp.

641 (N.D. Fla. 1970).

* This is the point on which the majority and I differ. The

majority relies on the statement in One Lot that: ‘Collateral

estoppel would bar a forfeiture under § 1497 if, in the earlier

criminal proceeding, the elements of a § 1497 forfeiture had

been resolved against the Government.” 409 US. at 234

(citation omitted). The majority also relies on a footnote in

One Lot in which the Court distinguished Coffey on the

ground that the criminal proceeding and the forfeiture there

involved identical allegations, rather than on the ground

that the forfeiture there was criminal in nature. See id.

at 235 n.5. Viewed in isolation, these two snippets support

the majority. But they cannot be read in a vacuum. In the

course of the same discussion, the One Lot Court advanced

the standard of proof argument as an independent ground

for rejecting the invocation of collateral estoppel. See id. at

235. Moreover, if the One Lot Court rejected the standard

28a

The two courts that have addressed the precise

question presented in this case have stated that the

§ 924(d) forfeiture proceeding is not barred. See

Glup v. United States, 523 F.2d 557 (8 Cir. 1975)

(dictum); Epps v. Bureau of Alcohol, Tobacco and

Firearms, 375 F. Supp. (S.D. Tenn. 1973), aff'd

without opinion, 495 F.2d 1873 (6 Cir. 1974). The

majority attempts to distinguish these two cases, As

for Glup, the majority points out that there, unlike in

the present case, different firearms were involved in

the criminal proceeding than were involved in the

forfeiture. This observation is correct, and that ap-

parently renders the court’s discussion in Glup dic-

tum. But, although dictum, the Eighth Circuit ex-

plicitly stated that § 924(d) forfeitures are civil in

nature, thereby disposing of the double jeopardy and

res judicata arguments, and also stated: “Even as-

suming, arguendo, that the criminal trial and the

forfeiture involved some of the same firearms, the

collateral estoppel doctrine, which is at the core of

the appellant’s present contention, does not apply.”

523 F.2d at 561. Not surprisingly, the reason the

court gave for this last conclusion was the difference

in the standards of proof involved in the two proceed-

ings. Id. As for Epps, the majority notes that it

fails to mention Coffey. But that is of no significance

since Coffey, as I have already indicated, is inapposite.

of proof argument, it broke with the explicit reasoning of a

half-dozen cases decided by the Supreme Court since Coffey.

One Lot contains not the slightest hint, however, that the

Court thought that is .vhat it was doing. The majority

declines even to mention One Lot’s discussion of standards

of proof or a single one of the Supreme Court cases that

intervened between Coffey and One Lot.

29a

IV. '

In my view of the case, I am brought finally to

claimant’s contention that the district court’s factual

findings should be set aside on appeal, The govern-

ment argues that the scope of review is Jimited to a

determination of whether the district court abused its

discretion. There is a dearth of authority on the

question of the scope of review. I would be inclined

to hold that the proper scope of review is the “not

clearly erroneous” test of Rule 52, Fed. R. Civ. P.,

but I would find it unnecessary to decide the issue

here, because I think that the district court’s findings

pass either test.

I would affirm the judgment of the district court.

30a

APPENDIX C

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No, 81-1055

UNITED STATES OF AMERICA, APPELLEE

v8.

ONE ASSORTMENT OF 89 FIREARMS, APPELLANT

NATIONAL RIFLE ASSOCIATION OF AMERICA,

AMICUS CURIAE

JUDGMENT

Appeal from the United States District Court

for the District of South Carolina

THIS CAUSE came on to be heard on the record

and the petition for rehearing, and the said cause was

argued by counsel.

ON CONSIDERATION WHEREOF, It is now here

ordered and adjudged by this Court, upon rehearing,

that the judgment of the said District Court appealed

from, in this cause, be, and the same is hereby,

reversed,

Aug. 23, 1982

/s/ William K, Slate, II

Clerk

8la

APPENDIX D

IN THE DISTRICT COURT

OF THE UNITED STATES

FOR THE DISTRICT OF SOUTH CAROLINA

COLUMBIA DIVISION

Civil Action No, 77-590

UNITED STATES OF AMERICA, PLAINTIFF

—versus—

ONE ASSORTMENT OF 89 FIREARMS, DEFENDANT

Dec. 30, 1980

ORDER

This forfeiture action, brought pursuant to 18

U.S.C. § 924(d), comes before the court with a long

and somewhat complex history.

The assortment of firearms in question was seized

by the Bureau of Alcohol, Tobacco and Firearms on

January 20, 1977, from the residence of Patrick M.

Mulcahey in Columbia, §.C. Subsequently, Patrick

Muleahey was tried for alleged criminal violations

pertaining to such firearms. A jury found Mulcahey

not guilty of the charges against him on March 16,

1977.

On March 31, 1977, the plaintiff filed this civil ac-

tion in rem seeking forfeiture to the United States of

an assortment of firearms, as identified in an exhibit

to the Complaint. The basis for such forfeiture, as al-

leged in the Complaint, was that: “said firearms

1 Mulcahey’s Indictment alleged violations of 18 U.S.C.

§§ 922(a) (1) and 924(a). It charged that, from on or about

May 12, 1976 up to the return of the Indictment on January

19, 1977, Mulcahey was engaged in the business of dealing

in firearms without being licensed to do so.

82a

were had and possessed and used an intended to be

used on January 20, 1977, and prior thereto by Pa-

trick M. Muleahey in Richland County, South Caro-

lina, in violation of the laws of the United States by

engaging in the business of a dealer in firearms and

ammunition without the said Patrick M. Muleahey

having first applied for and received a license as a

dealer in firearms... .” A warrant for arrest and

notice was issued April 4, 1977. Patrick M. Muleahey

filed a Claim and Answer on April 14, 1977.

Upon Motion of the Plaintiff, the court ordered

amendment of the Complaint on July 6, 1977, and on

the same date issued a Warrant for Arrest and No-

tice thereon. On July 18, 1977, the claimant filed his

Claim and Answer to the Amended Complaint. Sub-

sequent to that time, the parties entered into discov-

ery proceedings and as a result thereof have stipu-

lated that the transcript of the aforementioned crimi-

nal proceeding, United States v. Mulcahey, Criminal

No. 77-0013 (D.S.C, 1977), would be subinitted to the

court in lieu of testimony.

By Order dated November 14, 1978, Judge Robert

W. Hemphill, to whom this case was assigned initially,

granted the plaintiff’s Motion to Strike the second and

third defenses of the defendant’s Answer, and denied

the claimant’s Motion for Summary Judgment. Pur-

suant to the parties’ stipulations, the case was sub-

mitted for decision on the basis of the aforementioned

transcript and briefs, all of which have been filed

with the court.

From this background, and on the basis of the evi-

dentiary sources presented by the government and the

claimant, the court makes the following Findings of

Fact and Conclusions of Law:

88a

FINDINGS OF FACT

1. The commencement of this action was author-

ized, sanctioned and directed in accordance with 26

U.S.C, § 7401, as demonstrated by a letter with at-

tachments from James C. Bright, Kegional Counsel,

Bureau of Alcohol, Tobacco and Firearms, Depart-

ment of the Treasury, said letter being incorporated

into plaintiff’s Brief as Appendix II.

2. The claimant, Patrick M. Mulcahey, did not have

a Federal firearms dealer’s license during the period

July 1, 1975 to March 31, 1977, as shown by the cer-

tification of the lack of such record in official files by

the Supervisor, Firearms Explosives Licensing Sec-

tion, Regulatory Enforcement, Bureau of Alcohol, To-

bacco and Firearms, United States Departinent of the

Treasury for the Southeast Region, Atlanta, Georgia.

This certification and attendant documents are in-

corporated in plaintiff’s Brief as Appendix III.

3. On May 138, 1976, the claimant at his residence,

1407 Woodlawn Avenue, Columbia, South Carolina,

sold a Ruger .857 Magnum Pistol, Serial Number 150-

43012 to undercover Special Agent George D. Fergu-

son, Jr., and informant Kenneth E. Williford for

$180. On this occasion, according to Special Agent

Ferguson’s report, the claimant possessed and offered

for sale three other firearms, to wit: A Colt .38 Spe-

cial Automatic for $160; a Carbine for $160; a .88

Caliber Rifle. The claimant stated, according to

Ferguson’s report, that he had 5,000 rounds of .223

caliber ammunition and would take $450 for it. Also,

it was stated in the report that Williford was present

with a firearm described as an “Enforcer” and Mul-

cahey offered him $60 plus the carbine for it.

4. On May 19, 1976, at his residence, the claimant

sold a Taurus .88 Calriber Pistol, Serial Number

858162 to undercover Special Agent Ferguson and

informant Williford for $90. On this occasion, ac-

84a

cording to the agent’s report, the claimant possessed

and offered for sale four other firearms, to wit: A

.388 caliber rifle for $100; a 9 mm automatic nine-shot

for $175; a Smith & Wesson .857 Magnum, Model 19

for $215; and a .45 automatic for $175. When asked

if he had any more guns for sale, the claimant replied,

according to the agent’s report, that he did not know

exactly what he had on hand and did not know how

many he wanted to sell. According to the report,

when the claimant again asked about the “Enforcer,”

informant Kenneth E. Williford stated that it needed

repairs. Claimant replied that he would like to take

it and fix it.

5. On May 26, 1976, at his residence, the claimant

sold a Smith & Wesson 9 mm automatic, Model 39-2,

Serial Number A275312 to informant Kenneth E. Wil-

liford for $180 in the presence of Special Agent

George D. Ferguson, Jr. Prior to making this sale the

claimant required Williford to execute a Form 4473

which was later seized at claimant’s residence on

January 20, 1977. According to the agent’s report, at

the time of the sale of this firearm, the claimant pos-

sessed and offered for sale the following firearms:

an Army .45 automatic, a .22 rifle, a carbine, a .357

Smith & Wesson, and a Colt .45 caliber with pearl

handles. The claimant said that he would sell Willi-

ford more guns. The claimant again said that he

would like to have the “Enforcer” and Williford told

him that he thought he had it sold.

6. In mid 1976, the claimant purchased a Smith &

Wesson .357 revolver, Serial Number 8K15410, from

non-licensee, Karl O. Grant, for $150. This weapon

was seized on January 20, 1977, from the claimant

and is on the list of firearms atatched to the forfeiture

Complaint.

7. In the latter part of 1976, the claimant pur-

chased a Smith & Wesson, Model 60, Revolver, .38

85a

caliber, Serial Number R132162 from non-licensee,

Randall B. Richardson, for $170. This firearm was

seized on January 20, 1977, from the claimant and

is on the list of firearms attached to the forfeiture

Complaint.

8. On August 21, 1976, the claimant purchased

from Thomas 0. Lain, d/b/a Lain’s Gun Shop, a

licensed firearms dealer, twu Ruger caliber .223 rifles.

9. On October 5, 1976, the claimant purchased

from Thomas O. Lain, d/b/a Lain’s Gun Shop, a li-

censed firearms dealer, three Ruger Mini, Model 14,

.223 Caliber Rifles, Serial Numbers 180-53444, 180-

50813, and 180-51289. Two of these weapons, 180-

53444 and 180-50813, were seized on January 20,

1977, from the claimant and are on the list of fire-

arms attached to the forfeiture Complaint.

10. On December 31, 1976, the claimant purchased

from Thomas O. Lain, d/b/a Lain’s Gun Shop, a li-

censed firearms dealer, two firearms, to wit: One

Ruger Mini, Model 14, .223 Caliber Rifle, Serial Num-

ber 180-49696, and one Smith & Wesson, 9 mm,

Model 59, Pistol, Seria! Number A345245. These two

firearms were seized on January 20, 1977, from the

claimant and are on the list of firearms attached to

the forfeiture Complaint.

11. On January 13, 1977, the claimant at his res-

idence offered for sale to informer Kenneth Williford

and undercover Special Agent R. Jerry Embree two

Springfield rifles for $150 each, two S & W Auto-

matic Pistols, and one .857 Revolver. On this occa-

sion, the claimant said everything he had was for

sale except one pump shotgun that he was putting a

front sight on.’

2 Agent Embree’s contemporaneous interpretation of claim-

ant’s comment to mean “everything [they] saw on that

86a

12. On January 20, 1977, Special Agent Robert

Holland, assisted by other agents, executed a Federal

search warrant on claimant’s residence, 1407 Wood-

lawn Avenue, Columbia, South Carolina, and seized

105 firearms.

13. Thirteen of the 105 firearms seized were de-

termined to have been stolen and were returned to

their owners. The 92 remaining firearms were de-

scribed on the list attached to the original Complaint.

One Luger Model 1918, 9 mm automatic pistol, serial

number 8914 was added by amendment to the original

Complaint. From this total of 93 firearms, four were

returned to the claimant’s wife pursuant to Judge

Robert Hemphill’s Order of July 6, 1977. This leaves

89 firearms as the subject of this Order.

14, Of the 89 firearms remaining as the subject of

this action, nine are the property of members of the

Mulcahey family other than the claimant. As identi-

fied at Mulcahey’s criminal trial, these firearms and

their owners are as follows: Government’s exhibits

77 and 78—property of claimant’s wife; Govern-

ment’s exhibits 24 and 59—property of claimant’s

daughters; Government’s exhibits 14, 91 and 97—

property of claimant’s older son; Government’s exhib-

its 39 and 109—property of claimant’s younger son.’

occasion [was for sale,]”" does not control the court’s inter-

pretation of claimant’s words. Obviously enough, at the time

claimant made the statement, Agent Embree could not have

known of the full extent of the firearms inventory claimant

possessed. Nor, in interpeting the remark as it was spoken,

did Agent Embree have the advantage of the full course of

claimant’s activity spread before him, as this court does now.

* The court regards as insignificant the slight variance be-

tween claimant’s testimony at trial] and his answers to inter-

rogatories concerning the ownership of certain firearms by

his wife and children. Such small variance is explicable in

37a

While the firearms owned by members of the Mul-

cahey family other than the claimant were present in

the Mulcahey residence at the time of seizure, there

is no evidence that these particular firearms were

stored together with the firearms owned by the claim-

ant, that they were offered for sale by the claimant,

or that they were otherwise used in any manner in

the forfeitable offense.

CONCLUSIONS OF LAW

1. The Government has proved by the preponder-

ance of the evidence that the claimant, Patrick M.

Mulcahey, was engaging in the business of dealing in

firearms and ammunition without being licensed to

do so as required by federal law. It is well estab-

lished that a forfeiture proceeding under 18 U.S.C.

§ 924(d) is remedial in nature and is properly char-

acterized a civil proceeding. Bramble v. Richardson,

498 F.2d 968 (10th Cir. 1974) ; United States v. One

(1) 1969 Buick Riviera Automobile, 493 F.2d 553,

554 (5th Cir. 1974); Epps v. Bureau of Alcohol, To-

bacco & Firearms, 375 F.Supp. 345, 346 (E.D.Tenn.,

1973). Unlike the burden of proof “beyond a reason-

able doubt” applicable in criminal cases, the burden

of proof applicable in civil proceedings is the pre-

ponderance of the evidence standard. Glup v. United

States, 523 F.2d 557 (8th Cir. 1975); One Lot Em-

erald Cut Stones v. United States, 409 U.S. 232

(1972); One 1961 Lincoln Continental Sedan v.

United States, 360 F.2d 467 (8th Cir. 1966).

2. Appendix III of plaintiff’s Brief, a Certificate

of Lack of Official Record of Issuance of Firearms

light of the large number of firearms involved in the overall

matter. The court considers the claimant’s trial testimony

to be the more reliable.

38a

Dealer’s License to Patrick M. Mulcahey, 1407 Wood-

lawn Avenue, Columbia, South Carolina, for the pe-

riod July 1, 1975, to March 31, 1977, shows that the

claimant had not been issued a license to deal in fire-

arms for the period of July 1, 1975, to March 31,

1977. The claimant was at one time licensed to deal

in firearms. By his own admission at the criminal

proceeding against him, Mulcahey held a federal fire-

arms license from 1966 until sometime in 1975. How-

ever, the claimant bought and sold firearms on nu-

merous occasions during the period from July 1975

through March 1977, when no license to deal had been

issued to him. Evidence of these transactions clearly

establishes that during an eight-month period from

May 13, 1976, to January 20, 1977, the claimant did

engage in the business of dealing in firearms without

being licensed to do so. That this was the case is

evidenced by the following summary of these trans-

actions:

(a) seven purchases of firearms on four sepa-

rate occasions;

(b) three offers to purchase a firearm (the same

“Enforcer” ) on three separate occasions;

(c) three sales of firearms on three separate

occasions ;

(d) seventeen offers to sell firearms (at least

nine different firearms) on four occasions.

In his answers to the plaintiff’s interrogatories, the

claimant exhibited a marked inability to recall the

date he ac{uired the seized firearms, from whom and

how these firearms were acquired, and the purchase

price or other thing of value given by the claimant

in exchange for each firearm. Of the 91 firearms

89a

listed on the claimant’s Answers to plaintiff’s inter-

rogatories, the claimant was unable to give any in-

formation regarding 53 of these firearms.

The claimant, in his answers to the plaintiff’s in-

terrogatories, recalled at least four occasions when he

had purchased guns during the period in question; and

he recalled the three sales of firearms and one sale of

ammunition which occurred in May of 1976.

3. The type of firearms involved in these transac-

tions, as well as most of the firearms seized, were not

curios or relics, but of the sort commonly dealt in by

licensed dealers. The claimant submitted that many

of the guns were in fact curios or relics; but at trial,

firearms expert Robert J. Scroggie testified that, at

most, fourteen firearms were curios or relics, and only

five were positively curious or relics. None of the

firearms in question were identified as “antique fire-

arms” within the meaning of 18 U.S.C. § 921(a)

(16), so as to remove them from the definition of

“firearm” under § 921(a) (3), and thereby from the

prohibition of § 922(a) (1).

4, Of the claimant’s purchases, three or four were

of two or more of the same type firearm. The court

considers this to be strong evidence of dealing in fire-

arms, rather than collecting. In particular, of six

Ruger Mini 14, .223 caliber rifles purchased by the

claimant from August 21, 1976, to December 3, 1976,

only three remained among those firearms seized pur-

suant to the warrant on January 20, 1977.

5. Resale of guns shortly after their purchase is

yet another strong indicator of dealing in firearms.

At trial, Special Agent Robert Holland testified that

he had taken an inventcry of the claimant’s stock in

1974, during the period when the claimant was a

federally licensed firearms dealer. Nineteen of the

40a

firearms in the inventory at trial were present to

Holland’s inventory to Mr. Mulcahey’s stock of 51

firearms in July, 1974.

6. Though proof that an unlicensed person is en-

gaging in the business of dealing in firearms must,

of course, be based on the evidence presented in each

case, courts have upheld criminal convictions for un-

licensed dealing in firearms under factual situations

less aggravated than that of the instant case.

The sale of an unspecified number of firearms to a

stranger, plus offers to sell firearms to agents, was

held to be sufficient evidence to convict in United

States v. Apuzzo, 555 F.2d 306 (2nd Cir. 1977), cert.

denied, 435 U.S. 916 (1978).

The sale of seven handguns to undercover agents

in four separate transactions in early 1970, and seiz-

ure of 96 new handguns at the defendant’s home was

sufficient in United States v. Day, 476 F.2d 562 (6th

Cir. 1973). In the instant case, during the inonth of

May, 1976, three firearms were sold to undercover

agents in three separate transactions; twelve firearms

were offered for sale to the agents; three offers for

purchase of the “Enforcer” were made to the informer,

Mr. Williford; and on May 19, 1976, the claimant

even offered to repair the Enforcer for Mr. Williford.

Furthermore, 105 firearms were seized from the

claimant’s residence at the time the search warrant

was executed.

7. That several sales of firearms occur in a reason-

ably short space of time is evidence of dealing in fire-

arms. See United States v. Gross, 451 F.2d 1855 (7th

Cir. 1971), which involved the sale of eleven separate

weapons in a two-month period; and United States

v. Williams, 502 F.2d 581 (8th Cir. 1974), in which

there were five sales of firearms to Government

agents in a month’s time.

4la

8. A violation of 18 U.S.C. § 922(a)(1) does not

require that the Government establish dealing as the

equivalent of selling; nor does it require that the Gov-

ernment establish that the person engaged in the bus-

iness of dealing in firearms make a profit. United

States v. Vitale, 596 F.2d 688 (5th Cir. 1979); see

also United States v. Shirling, 572 F.2d 532 (5th

Cir. 1978). One sale to an agent along with the fact

that the defendant considered himself to be and held

himself out as a dealer was sufficient in United States

v. Swinton, 521 F.2d 1255 (10th Cir. 1975), cert.

denied, 424 U.S. 918 (1976).

In United States v. Huffman, 518 F.2d 80 (4th

Cir.), cert. denied, 423 U.S. 864 (1975), the Fourth

Cireuit upheld a conviction based upon dealings in-

volving more than a dozen transactions in the course

of a few months, including trading large quantities

of ammunition for firearms.

9. Crucial to a determination that one is dealing

in firearms, is the representation or holding out by

the defendant, or in the instant civil contest, by the

claimant, that he buys and/or sells firearms and am-

munition. In United States v. Micieli, 594 F.2d 102

(5th Cir. 1979), evidence of the defendant’s acquisi-

tion of firearms along with the defendant’s statement

that he sold 10 firearms, was sufficient to establish

“dealing in firearms.” The only evidence of sale in

Micieli was the defendant’s statement.

In the instant case, the claimant had Mr. Williford

execute a firearms Form 4473. This is a firearms

disposition record which is presented by the seller to

the buyer for him to fill out. It is a standard form

which is used by licensed firearms dealers; it serves

as protection for the licensed dealer in the event the

buyer is a convicted felon or is otherwise restricted

42a

in his ability to purchase firearms. The claimant even

asked Mr. Williford for his driver’s license number

as identification on the form. Furthermore, on Jan-

uary 13, 1977, the claimant in the instant case rep-

resented to Mr. Williford and Special Agent R. Jerry

Embree that “everything he had was for sale,” ex-

cept for one firearm on which he was working. This

statement by the claimant is evidence that at that

time he was engaging in the business of a dealer in

firearms and had committed for the purpose of, and

intended to use in, the said business, all the firearms

he possessed, except one. This statement by the claim-

ant also reflects the “willingness to deal” and “greater

degree of activity than occasional sales by a hobby-

ist,” suggested in United States v. Huffman, 518 F.2d

80 (4th Cir.), cert. denied, 423 U.S. 864 (1975).

10. In United States v. One Assortment of 12

Rifles and 21 Handguns, 313 F.Supp. 641 (N.D. Fla.

1970), and United States v. One Assortment of Fire-

arms and Ammunition, 313 F.Supp. 1056 (E.D. Teun.

1970), the claimants were engaged in the business of

dealing in firearms and ammunition without being

licensed to do so, in violation of 18 U.S.C. § 922(a)

(1). The facts established that the claimants had

been selling firearms, and firearms were displayed for

sale. On these facts, the courts ordered forfeiture of

the firearms and ammunition.

In the instant case, although the claimant did not

display his entire assortment of firearms, he did main-

tain them all in his residence, from which he also op-

erated an army surplus business. The fact that the

claimant kept the entire assortment of firearms so

accessible to his surplus showroom, that he repeatedly

went into the non-public area of his residence to ob-

tain the firearms he did display to government agents,

the claimant’s own statements, his course of dealing,

43a

and the wealth of circumstantial evidence in the rec-

ord prove by a preponderance of the evidence that he

used or intended to use all of the firearms he per-

sonally possessed as an inventory to be drawn from

in the course of dealing in firearms, in violation of

18 U.S.C. § 922(a) (1).

11. Consequently, this court concludes that the

Government has proved by a preponderance of the

evidence that, with the exception of those firearms

labeled in claimant’s criminal] trial as Government’s

Exhibits 14, 24, 39, 59, 77, 78, 91, 97 and 109, the

firearms here in question were involved in, used or

intended to be used in violation of 18 U.S.C. § 922

(a)(1). Such firearms are rendered subject to for-

feiture under 18 U.S.C. § 924(d), which forfeiture

is hereby ordered.

Those firearms identified as Government’s Exhibits

14, 24, 39, 59, 77, 78, 91, 97 and 109 shall be re-

turned to their owners as described in the fourteenth

finding of fact set out above. These Exhibits are de-

scribed by type and/or serial number as follows:

(1) Exhibit 14: Iver Johnson, 12 gauge single

barrel shotgun, Champion Model, Serial Num-

ber—None. (The court notes that claimant de-

scribed Exhibit 14 as a 16 gauge shotgun, when

it apparently is in fact a 12 gauge. Cf. Exhibit

44, which is a 16 gauge Iver Johnson shotgun.)

(2) Exhibits 24 and 59: two Remington 22

caliber Mohawk rifles, Serial Nos. 2324414 and

2324420.

(8) Exhibit 39: Winchester 22 caliber Model

290 Rifle with scope, Serial No. 695087.

(4) Exhibit 77: Kurz 9mm backup Model Au-

tomatic Pistol, Serial No. A03183.

44a

(5) Exhibit 78: Browning Sport King Model 22

long rifle automatic pistol, Serial No. 10466P69.

(6) Exhibit 91: Ruger carbine 44 magnum au-

tomatic rifle with scope, Serial No. 100-20568.

(7) Exhibit 97: Remington Fieldmaster 22 cali-

ber pump rifle, Serial No, 153708.

(8) Exhibit 109; Harrington & Richardson 410

gauge shotgun, Model 158, Serial No. AF 3398.

AND IT IS SO ORDERED.

/s/ Charles E. Simons, Jr.

CHARLES E, SIMONS, JR.

United States District Judge

Aiken, South Carolina

December 26, 1980.

45a

APPENDIX E

UNITED STATES DISTRICT COURT

D, SOUTH CAROLINA

COLUMBIA DIVISION

Civ. A. No. 77-590

UNITED STATES OF AMERICA, PLAINTIFF

Vv.

ONE ASSORTMENT OF 93 FIREARMS, DEFENDANT

Nov. 14, 1978

Glen E. Craig, Asst. U.S. Atty., Columbia, S8.C.,

for plaintiff.

Herbert W. Louthian, Columbia, S.C., for Patrick

M. Muleahey, owner of property.

ORDER ON DEFENDANT’S MOTION FOR

SUMMARY JUDGMENT AND PLAINTIFF'S

MOTION TO STRIKE

HEMPHILL, District Judge.

This is a forfeiture action, originally filed March

31, 1977, and in which and by which plaintiff seeks

condemnation as forfeited to the United States’, and

‘Under provisions of 26 U.S.C. § 7401, which provides:

Authorization.

No civil action for the collection or recovery of taxes, or

of any fine, penalty, or forfeiture, shall be commenced unless

the Secretary or his delegate authorizes or sanctions the pro-

ceedings and the Attorney General or his delegate directs

that the action be commenced.

viegatd

46a

a decree for the proper disposal thereof of 92 assorted

firearms, as listed in an exhibit to the complaint, on

the ground that “said firearms were had and pos-

sessed and used and intended to be used on January

20, 1977, and prior thereto by Patrick M. Mulcahey

and Richland County, South Carolina, in violation of

the laws of the United States by engaging in the

business of a dealer in firearms and ammunition with-

out the said Patrick M. Mulcahey having first applied

for and received a license as a dealer in firearms

** *” Tn his answer, filed April 18, 1977, Mulcahey,

first claimed ownership of the property described in

the complaint and entered a general denial; for a

second defense Mulcahey declared that he had been

tried on the criminal side of the court, under the

provisions of Chapter 44, Title 18, United States

Code, in violation of Title 18, United States Code,

$§ 922(2)(1) and 924(a) and thereafter acquitted

by a verdict of a jury which rendered the issues be-

fore the court as res judicata, and collaterally estops

the government from proceeding. A third defense al-

leges that the property was seized solely for the pur-

pose of use of said property in evidence in a criminal

proceeding and the criminal proceeding having been

terminated, that plaintiff had no right to retain or

condemn the property.

It is the last two defenses that plaintiff would strike,

as positioned in its motion to strike, filed September

20, 1977. On November 9, 1977, defendant moved for

summary judgment on the grounds that the owner

had been acquitted in the criminal prosecution and

that such criminal prosecution bars the forfeiture ac-

tion. Therefore the motions involve the same issue,

to wit: whether the admitted fact that the owner of

the firearms was acquitted in a criminal prosecution

47a

foreclosed the forfeiture action as pursued by the

government. The complaint veriies the fact that

plaintiff accuses Mu!cahey of violation of 18 U.S.C.

$$ 922(a)(1), 923(a), and 924(d). At the hearing

on the motions it was admitted that the verdict in the

criminal trial on these charges was not guilty. A

recitation or finding of fact is unnecessary as the

facts are not in dispute.

Initially, this court finds the complaint is lodged

under the forfeiture provisions of 18 U.S.C. § 924(d)

which states:

Penalties.

(d) Any firearm or ammunition involved in or

used or intended to be used in, any violation of

the provisions of this chapter or any rule or

regulation promulgated thereunder, or any viola-

tion of any other criminal law of the United

States, shall be subject to seizure and forfeiture

and all provisions of the Internal Revenue Code of

1954 relating to the seizure, forfeiture, and dis-

position of firearms, as defined in section 5845 (a)

of that Code, shall, so far as applicable, extend to

seizures and forfeitures under the provisions of

this chapter.

It is to be noted that the section is not a criminal

statute in term or in effect, but provides a civil penalty

—forfeiture—for “any violation of the provisions

of this chapter or any rule or regulation promulgated

thereunder * * *.” Such is the case before the court,

a civil pursuit, as countenanced by the statute. A

forfeiture proceeding is remedial in nature and is

properly characterized as a civil proceeding. Glup v.

United States, 523 F.2d 577, 561 (8th Cir. 1975);

One Lot Stones v. United States, 409 U.S. 232, 237,

48a

93 S.Ct. 459, 498, 34 L.Ed.2d 488, 443 (1972) citing

Helvering v. Mitchell, 303 U.S. 391, 58 S.Ct. 630, 634,

82 L.Ed. 917 (1930).

In Glup the Eighth Circuit stated:

Even assuming, arguendo that the criminal

trial and the forfeiture involved some of the

same firearms, the collateral estoppel doctrine,

which is at the core of appellant’s present conten-

tion, does not apply. The collateral estoppel ef-

fect of an acquittal on a forfeiture proceeding

has been most recently addressed by the Supreme

Court in One Lot Emerald Cut Stones v. United

States, 409 U.S, 282, 98 S.Ct, 489, 34 L.Ed.2d

438 (1972). In that case, the owner of unde-

clared imports urged that his acquittal of charges

of violating 18 U.S.C. § 545, was a defense to a

forfeiture action instituted by the Government

under the Tariff Act of 1930, 18 U.S.C. §§ 5465,

597. The district court held that the forfeiture

was barred by collateral estoppel and the fifth

amendment. The Court of Appeals for the Fifth

Circuit reversed. The Supreme Court granted

certiorari and affirmed. Citing Ashe v. Swenson,

397 U.S. 436, 443, 90 S.Ct. 1189, 25 L.Ed.2d 469

(1970), the Court noted that “[c]ollateral estop-

pel would bar a forfeiture under § 1497 if, in the

earlier criminal proceeding, the elements of a

§ 1497 forfeiture had been resolved against the

Government.” 409 U.S. at 234, 93 S.Ct. at 491.

But the Court observed, acquittal on the criminal

charge does not necessarily resolve the issues in

the forfeiture action. The difference in the bur-

den of proof in a criminal case and in a civil pro-

49a

Moreover, the difference in the burden of

proof in criminal and civil cases precludes

application of the doctrine of collateral es-

toppel. The acquittal of the criminal charges

may have only represented “ ‘an adjudica-

tion that the proof was not sufficient to

overcome all reasonable doubt to the guilt of

the accused’.” As to the issues raised, it

does not constitute an adjudication on the

preponderance-of-the-evidence burden ap-

plicable in civil proceedings.

409 U.S. at 235, 98 S.Ct. at 492 (citations omit-

ted). It is well established that a forfeiture pro-

ceeding under 18 U.S.C. § 924(d) is remedial in

nature and is properly characterized as a civil pro-

ceeding. Bramble v. Richardson, 498 F.2d 968

(10th Cir. 1974); United States v. One (1)

1969 Buick Riviera Automobile, 498 F.2d 558,

554 (5th Cir. 1974); Epps v. Bureau of Alcohol,

Tobacco & Firearms, 375 F.Supp. 345, 346 (E.D.

Tenn. 1973); United States v. 1,922 Assorted

Firearms, 330 F.Supp. 685, 687 (E.D.Mo. 1971).

(Emphasis added.) (p. 561.)

The reasoning in One Lot Stones is also applicable

here:

If for no other reason, the forfeiture is not

barred by the Double Jeopardy Clause of the

Fifth Amendment because it involves neither two

criminal trials nor two criminal punishments

“Congress may impose both a criminal and a

civil sanction in respect to the same act or omis-

sion * * *” (Citing Nelvering v. Mitchell, supra.)

An examination of the record here shows one crim-

inal case, another civil. The difference in the crimi-

nal proceeding on the one hand and the forfeiture

50a

proceeding on the other emphasizes the distinction

here. The rvesent action invokes the provisions of 26

U.S.C. § 5872(a)* and 26 U.S.C. § 7323(a).* The

criminal action was not based on, neither included nor

involved such sections.

This forfeiture action was properly brought under

the provisions of 18 U.S.C. §924(d) invoking the

provisions of 26 U.S.C. §5872(a) and 26 U.S.C.

§ 7828(a). This is an action in rem commenced by

the Complaint for Forfeiture filed on March 31, 1977.*

The court ordered (April 4, 1977) that Warrant for

Arrest and Notice issue. The court obtained jurisdic-

tion over the property by the Marshal arresting it and

retaining custody thereof under the direction of the

court. There is nothing in such statutes that requires

the property be seized under a warrant specifically

providing that it is seized for forfeiture.

226 U.S.C. § 6872(a) provides: Forfeitures.

(a) Laws applicable-—Any firearm involved in any viola-

tion of the provisions of this chapter shall be subject to

seizure and forfeiture, and (except as provided in subsection

(b)) all the provisions of internal revenue laws relating to

searches, seizures, and forfeitures of unstamped articles are

extended to and made to apply to the articles taxed under this

chapter applies.

*26 U.S.C. § 7828(a) provides: Judicial action to enforce

forfeiture.

(a) Nature and venue.—The procecdings to enforce such

forfeitures shall be in the nature of a proceeding in rem in

the United States District Court for the district where such

5la

Where the property is lawfully seized as evidence

in a criminal proceeding, it may be made the subject

of a forfeiture proceeding under the provisions of 18

U.S.C. § 924(d), 26 U.S.C. §§ 5872(a), and 7323(a).

It is clear that a claimant in a forfeiture proceeding

is not entitled to the return of the defendant property

on the ground he was acquitted in the related criminal

proceeding. Glup, supra; United States v. One 1969

Buick Riviera Automobile, 493 F.2d 553 (5th Cir.

1974).

Of interest to this discussion is Epps v. Bureau of

Alcohol, Tobacco & Firearms, 375 F.Supp. 345 (E.D.

Tenn. 1973), affirmed without opinion, 495 F.2d 1873

(6th Cir.). There the court stated as follows:

It is undisputed that the plaintiff did not, at

the pertinent times, have a license to engage in

the business of dealing in firearms and ammuni-

tion; but, he was acquitted of having violated the

provisions of 18 U.S.C. § 922(a)(1) on Novem-

ber 7, 1972, in United States of America, plain-

tiff v. William E. Epps, Jr., defendant, criminal

action no. 7260, this district and division. Such

acquittal on such criminal charge is not a bar to

the civil administrative action by the govern-

ment, which is remedial in nature, arising out

of the same facts on which the criminal proceed-

ing was based. Helvering v. Mitchell (1988),

303 U.S. 391, 397, 58 S.Ct. 630, 32 L.Ed. 917,

921 (headnote 2). Forfeiture of goods is a civil

sanction, remedial in nature. Ibid., 303 U.S. at

400, 82 L.Ed. at 922 (headnote 6); see also

Colawieco v. United States, infra, [2 Cir.] 148

¥.2d [410] at 411-412[2]. (Emphasis added.)

(p. 346).

It is obvious the second defense is insufficient.

52a

THE THIRD DEFENSE

In paragraph 9 of the complaint Mulcahey alleges

that some of the appraised values of the firearms are

not accurate and that the appraised total value is ap-

proximately one-third of the actual total value. This

is not a valid defense.

The general statute (26 U.S.C. § 7823) providing

for judicial action to enforce forfeiture does not re-

quire any appraisal of seized property. That statute

is subject to the exception in 26 U.S.C. § 7325 provid-

ing that if the property is valued at $2,500 or less

it will be appraised—as the claimant is entitled to ju-

dicial enforcement of the forfeiture where the prop-

erty has a value of $2,500 or less if he files $250 cost

bond. The regulations are in accord with the statutes

in not applying the appraisement procedure set forth

in 26 U.S.C. § 7325 where the property is alleged to

have a value of over $2,500. Accordingly, where the

property is alleged to have a value of over $2,500, the

appraisal is jurisdictional only to the extent that it

entitles the claimant to a judicial action without the

requirement that he post a cost bond.

Since the Government’s appraised value in this

case is over $2,500 and is admitted to be so by Mul-

cahey in his Answer, any defect or inaccuracy in the

appraisal is not jurisdictional and is immaterial to

the prosecution of the forfeiture action. In other cir-

cumstances involving administrative forfeiture pro-

ceedings where the property was appraised at $2,500

or less, it has been held tha. a technical defect in the

appraisal was not jurisdictional to the administrative

forfeiture proceedings. Glup, supra. For an explana-

tion of the reason for the. requirements of appraisal

and filing of a cost bond by the claimant where the

property is valued at $2,500 or less, see Epps, supra;

58a

and Application of Colacicco, 55 F. Supp. 766

(D.N.Y. 1948) affirmed 143 F.2d 410 (2d Cir. 1944).

In paragraph 10 Mulecahey alleges that many of the

alleged items of property were not his property, but

the property of his wife, children, and others.’ This

does not allege a valid defense to the forfeiture of

any of the property. See United States v. One 1972

Toyota Mark I], 505 F.2d 1162 (8th Cir. 1974) where

the Eighth Circuit stated as follows:

The innocence, noninvolvement or lack of neg-

ligence of the owner in allowing the vehicle to

be used for the forfeitable offense is no defense

to the forfeiture action. United States v. One

1971 Lincoln Continental Mark III, 460 F.2d

273, 275 (8th Cir. 1972); United States v. One

1967 Cadillac Coupe Eldorado, 415 F.2d 647, 648

(9th Cir. 1969) ; United States v, One 1961 Cad-

illac, 387 F.2d 730, 732 (6th Cir. 1964); ef.

Calero-Toledo v. Pearson Yacht Leasing Co., 416

U.S. 668, 94 S.Ct. 2080, 40 L.Ed.2d 452 (1974).

(p. 1165)

In paragraph 11 Mulcahey alleges, in effect, that

many of the seized items were “curios and relics”

and not firearms within the meaning of Chapter 44,

Title 18 U.S.C., and that such items should be elimi-

nated from the forfeiture proceeding. This is a mis-

interpretation of the statutes and does not allege a

defense to the forfeiture action.

5’ By order dated July 6, 1977 the court ordered that four

of the firearms be delivered to Mrs. Mulcahey. Government

counsel moved for such Order. No one except Mulcahey has

filed a claim for any of the defendant firearms as required

by the notice published in THE STATE newspaper dated

April 29, 1977.

Rene ’

> whos

54a

The provisions of 18 U.S.C. § 921(a) (13) and 27

CFR 178.11 defining certain firearms as “curios and

relics” make it clear that firearms classified as

“curios and relics” are “firearms” as defined in 18

U.S.C. § 921(a) (3)-(8). It is clear that the statute

provides for certain firearms to be classified as

“curios and relics” in order to create the category

of licensee as a collector ((18 U.S.C. § 923(b)) who

is a person “who acquires, holds, or disposes of fire-

arms and ammunition as curios and relics” ((18

U.S.C. § 921(a) (13)).

An unlicensed person is not prohibited from col-

lecting firearms generally or of the category of curios

or relics. Additionally, an unlicensed person may

only buy and sell firearms general! (including

“curios and relics”) within his own state, with cer-

tain exceptions, whereas if licensed as a collector

who “acquires, holds, and disposes of firearms as

curios and relics” he may acquire “curios and relics”

anywhere and dispose of them to any licensee wher-

ever located.

27 C.F.R. 178.41(d) makes it clear that a collec-

tor’s license applies “only to transactions related to

a collector’s activity in acquiring, holding, or dispos-

ing of curios and relics” and such license does not

authorize the collector licensee to acquire and dispose

of curios and relics in engaging in the business of a

dealer in firearms.

CONCLUSIONS

For the reasons stated above the court concludes

that the motion to strike the second and third de-

fenses is granted and that the defense motion for a

summary judgment is denied. (The court schedules

55a

a post-decision status hearing November 27, 1978, at

10:00 a.m. o’clock, at Columbia).

The Second and Third Defenses of the Answer are

stricken. The Motion for Summary Judgment is

denied.

AND IT IS SO ORDERED.

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