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United States of America v. Gregory Frank Sperow

August 29, 2011

UNITED STATES OF AMERICA, PLAINTIFF,
v.
GREGORY FRANK SPEROW, DEFENDANT.



The opinion of the court was delivered by: Honorable B. Lynn Winmill Chief U. S. District Judge

MEMORANDUM DECISION AND ORDER

Pending before the Court is Gregory Frank Sperow's ("Sperow") Motion to Stay Final Order of Forfeiture (Dkt. 1155) and the Government's Motion to Strike Defendant's Motion for Stay (Dkt. 1166). For the reasons set forth below, the Court denies both Motions.

BACKGROUND

Sperow pleaded guilty to the following charges in the Second Superseding Indictment (Dkt. 425): drug conspiracy in violation of 21 U.S.C. §§ 841 and 846 (Count Two), money laundering conspiracy in violation of 18 U.S.C. § 1956(h) (Count Three), and the forfeiture allegations pursuant to 21 U.S.C. § 853(a) and 18 U.S.C. § 982(a)(1) (Counts 7 and 8). Amended Plea Agreement (Dkt. 666). Among the assets Sperow agreed to forfeit was what the parties refer to as "the Lancaster property." Id. at 8-11.

Based on the Amended Plea Agreement and convictions for drug trafficking and money laundering, the Court entered a Preliminary Order of Forfeiture (Dkt. 872) which was incorporated into the Judgment (Dkt. 883) entered on July 1, 2009 forfeiting Sperow's interests in all assets named in the Second Superseding Indictment including the Lancaster property.

A Final Order of Forfeiture (Dkt. 1148) was entered as to the Lancaster property on May 9, 2011. Sperow filed a Notice of Appeal (Dkt. 1154) of that Order on May 20, 2011. He then filed the pending Motion for Stay pending appeal pursuant to Rule 32.2(d) of the Federal Rules of Criminal Procedure.

Sperow's stated grounds for the stay are that he filed a timely notice of appeal from the final order of forfeiture, that he is preparing a motion pursuant to 28 U.S.C. § 2255 and believes it will result in vacating his Amended Plea Agreement, and that he would be prejudiced if a stay is not granted.

The Government moves to strike the Motion for Stay on the grounds that Sperow lacks standing to intercede in the ancillary proceeding, that the Court lacks jurisdiction to consider the Motion for Stay, and that Defendant waived his right to contest the forfeiture in his Plea Agreement. Sperow has not responded to the Government's Motion to Strike or requested an extension of time to respond.

DISCUSSION

A court may stay an order of forfeiture pending appeal of a final order of forfeiture to "ensure that the property remains available pending appellate review." Fed. R. Crim. P. 32.2(d). The stay does not delay any ancillary proceedings or determination of third party rights. Id. However, the stay does prevent a court from transferring any property interest to a third party until the appeal becomes final or the defendant consents. Id. Prior to considering Sperow's Motion for Stay, however, the Court must necessarily consider the Motion to Strike.

1. Motion to Strike

A. Lack of Standing

The Government contends that Sperow lacks standing to intercede in the ancillary proceeding because he has no remaining rights in the forfeited property and because 21 U.S.C. § 853(n)(2) specifically excludes a defendant in a criminal case from filing a claim in a related ancillary proceedings. The Court agrees that he has no standing to participate any ancillary proceeding. However, the Court does not view Sperow's Motion for Stay as an attempt to participate or file a claim in an ancillary proceeding. Rather, he is merely seeking a stay of the proceedings pursuant to Rule 32.2(d). Even when confronted with an apparent conflict between the rule and another more relevant section of the forfeiture statute, courts have found that a defendant has standing to request a stay.

Section 853(h) provides in part that "Upon application of a person, other than the defendant . . . the court may restrain or stay the sale or disposition of the property pending the conclusion of any appeal of the criminal case giving rise to the forfeiture . . . ." 21 U.S.C. § 853(h) (emphasis added). Rule 32.2 does not specifically exclude a defendant from seeking a stay. Courts have rejected government claims that § 853(h) precludes standing citing the Rules Enabling Actwhich provides that "all laws in conflict with the federal rules of procedures 'shall be of no further force or effect after such rules have taken effect.'" See United States v. Riedl, 214 F. Supp. 2d 1079, 1082 (D. Haw. 2001) (citing United States v. Bachner, 741 F. Supp. 221 (S.D. Fla. 1990)). See also United States v. Quinones, No. 06-CR-845(S-2)(FB), 2009 WL ...


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