United States v. King (231 F. Supp. 3d 872, 2017)

MEMORANDUM OPINION AND ORDER re: FORFEITURE

STEPHEN P. FRIOT, UNITED STATES DISTRICT JUDGE

Table of Contents

I. Introduction... 881

A. The Criminal Charges.. .882

B. The Trials and Convictions... 883

C. The Moving Papers and Evidentiary Hearing.. .884

II. Authority for Forfeiture... 886

A. Forfeiture Procedures... 886

B. General Principles.. .887

C. Forfeitures Based on RICO Conspiracy Convictions... 891

D. Forfeitures Based on Convictions for Operation of Illegal Gambling Business ...894

E. Forfeitures Based on Money Laundering Conspiracy Convictions... 895

F. Forfeiture Based on a Facilitation Theory.. .897

III. The Excessive Fines Clause... 899

IV. Burden of Proof... 905

A. The Government’s Burden.. .905

B. The Defendants’ Burden... 907

V. The Exclusionary Rule... 908

VI. Tracing, Tainting, Commingling and Extrapolation... 910

A. Tracing, Tainting and Commingling. . .910

B. Extrapolation... 915

VII. Notice of the Government’s Intent to Seek Money Judgment.. .916

VIII. Overview of the Government’s Forfeiture Case... 917

A. The Government’s Forfeiture Brief (doc. no. 1999).. .917

1. King... 918

2. Koralewski.. .919

3. Tucker... 919

4. Moran... 920

5. Robles... 920

6. Bramley.. .920

7. Diebner.. .920

B. The Government’s Presentation at the Forfeiture Trial... 920

IX. Findings of Fact... 922

A. Introduction... 922

B. Viability of the Government’s Characterization of Funds Allegedly Laundered ...924

1. Preliminary Matters... 924

2. Sources of Deposits and Nature of Activities Generating the Funds... 927

3. Money Laundering Total... 948

4. A Brief Digression... 949

C.Viability of the Government’s Proposed Direct Attributions and Extrapolations ...951

1. General Nature of the Government’s Proposed -Direct Attributions and Extrapolations ...951

2. Extrapolation Based on Legendz Payouts to Bettors through Global Data Payment Services... 954

3. The Government’s Proposed Extrapolations and Direct Attributions re: Proceeds Attributable to Individual Agents and Runners... 955

a. Terry Campbell.. .955

b. Ralph Hernandez.. .957

c. Kelly Diebner... 960

d. Christopher Tanner ...965

e. Michael Lawhorn... 966

f. Joseph Barry.. .970

g-Paul Tucker.. .970

h. Bruce Middlebrook. . .972

i. Rodger Bramley.. .974

j-Paul Wilson.. .976

k. Leon Moran.. .977

1. Joseph McFadden.. .981

m. David Ross... 983

n. Kory Koralewski... 983

0. Luis Robles... 993

4.Conclusion as to the Government’s Proposed Extrapolations and Direct Attributions ...994

D.Viability of the Government’s Contention that all Forfeiture Defendants, Regardless of their Respective Degrees of Participation in the Legendz Enterprise, Should be Subjected to a Forfeiture Money Judgment in the Same Amount.. .995

E. Findings Specific to King...996

1. Forfeiture of Specific Assets... 996

2. Forfeiture Money Judgment... 999

F. Findings Specific to Koralew-ski.. .999

1. Forfeiture of Specific Assets... 999

2. Forfeiture Money Judgment.. .1001

G. Findings Specific to Tucker.. .1001

1. Forfeiture of Specific Assets... 1001

2. Forfeiture Money Judgment.. .1001

H. Findings Specific to Moran... 1006

I. Forfeiture of Specific Assets... 1006

2. Forfeiture Money Judgment.... 1006

I. Findings Specific to Robles... 1008

1. Forfeiture of Specific Assets... 1008

2. Forfeiture Money Judgment.. .1008

J. Findings Specific to Bram-ley... 1009

1. Forfeiture of Specific Assets... 1009

2. Forfeiture Money Judgment.. .1012

K. Findings Specific to Dieber.. .1013

1. Forfeiture of Specific Assets... 1013

2. Forfeiture Money Judgment.. .1013

L. Summary of Forfeiture-Related Findings... 1014

X. Forfeiture-Related Sanctions Against the United States... 1015

XI. Conclusion... 1022

I. Introduction

The government moves for preliminary orders of forfeiture against the defendants Bartice A. “Luke” King, Kory Elwin Ko-ralewski, Paul Francis Tucker, Leon Mark Moran, Luis Robles, Zapt Electrical Sales Inc., Rodger Vanpelt Bramley and Kelley Ward Diebner. This order refers to these parties, other than Zapt, as “the forfeiture defendants.”

The government seeks forfeiture of specific assets as well as a forfeiture money judgment. See generally, Rule 32.2(b), Fed.R.Crim.P. (procedures for entering a preliminary order of forfeiture). As for the forfeiture money judgment, the government now seeks a judgment in the amount of $231,432,686.73 against the forfeiture defendants. (In the last of the four jury trials that were held in this case, an FBI witness maintained, repeatedly, that the government actually seeks $1 billion by way of forfeiture. Oct. Tr. 2074, 2077, 2114-14.)

These forfeiture proceedings are, to put it mildly, contested.

The findings of fact in this order are based on the evidence presented at the four jury trials which were held in this case, as well as the James hearings and the nonjury trial which was addressed exclusively to forfeiture issues — all of which generated 11,368 pages of trial transcript.

A. The Criminal Charges

The original Indictment in this case was returned on March 20, 2013. It alleged a ten-year conspiracy period for the two conspiracy counts. Doc. no. 1, at 18, 47. As of the date of the Indictment, there was about a nine-year overlap between the ten-year duration of the conspiracy and the duration of the government’s investigation of that conspiracy.

The original Indictment charged fifty-seven defendants, including six of the eight forfeiture defendants now before the court (King, Koralewski, Moran, Robles, Tucker and Zapt). Doc. no. 1. The Indictment charged: Count 1, a racketeering (RICO) conspiracy in violation of 18 U.S.C. § 1962(d); Count 2, operation of an illegal gambling business in violation of 18 U.S.C. § 1955; and Count 3, conspiring in violation of 18 U.S.C. § 1956(h) to commit money laundering under 18 U.S.C. §§ 1956 and 1957. The Indictment included forfeiture allegations stating the government’s intent to seek criminal forfeiture of at least $1,000,000,000.00 as well as specific items of real and personal property.

On August 16, 2013, the United States filed a Bill of Particulars for Forfeiture of Property, giving notice to defendants King, Tucker and Moran (and other defendants not involved in these forfeiture proceedings), that the United States was seeking forfeiture of additional specific property listed in the Bill of Particulars. Doc. no. 346.

On August 21, 2013, a grand jury sitting in the Western District of Oklahoma returned a Superseding Indictment against fifty-nine defendants, including the eight forfeiture defendants before the court in these proceedings (King, Koralewski, Tucker, Moran, Robles, Zapt, Bramley and Diebner). Doc. no. 354. The Superseding Indictment included modified versions of the same three counts. The Superseding Indictment included forfeiture allegations stating the government’s intent to seek criminal forfeiture of at least $1,000,000,000.00 and specific items of real and personal property. Each of the forfeiture defendants was convicted, by a jury, on one or more of the three counts.

On October 15, 2013, a Second Bill of Particulars for Forfeiture of Property was filed providing notice (to the extent material here) to King, Bramley and Diebner of the government’s intent to pursue forfeiture of additional items of real and personal property. Doc. no. 465.

B. The Trials and Convictions

The sheer number of defendants necessitated multiple trials. Accordingly, the forfeiture defendants, along with other defendants, were grouped in four sets of defendants to be tried together in four separate trials. All of the defendants who have been tried have agreed to have forfeiture determined by the court rather than by a jury.

The first trial began on February 12, 2015, and a jury verdict was returned on March 3, 2015. Forfeiture defendants Tucker, Robles and Zapt were tried in this first set of defendants. Tucker was found guilty on all three counts. Robles was found guilty on all three counts. Zapt was not a defendant with respect to Count 2, and was found guilty on Count 1 and Count 3. The court denied their post-trial motions. United States v. Robles, 2015 WL 12852050 (W.D. Okla. July 1, 2015).

The second trial began on April 14, 2015, and a jury verdict was returned on April 30, 2015. In the second trial, King (the lead defendant) was found not guilty on Count 1 (by any standard, the flagship count), and guilty on Count 2 and Count 3. The court denied King’s post-trial motion. United States v. King, 2015 WL 12852049 (W.D. Okla. July 10, 2015).

The third trial began on May 4, 2015, and a jury verdict was returned on May 22, 2015. Forfeiture defendants Moran, Bramley and Diebner were tried in this third set of defendants. All three of those defendants were found guilty on all three counts. The court denied their post-trial motions. United States v. Bramley, 2015 WL 12852048 (W.D. Okla. Sept. 16, 2015).

The fourth trial began on October 19, 2015, and a jury verdict was returned on November 4, 2015. Forfeiture defendant Koralewski was in this fourth set of defendants. Koralewski was found guilty on Count 1. He was found not guilty on counts two and three. The court denied Koralewski’s post-trial motion. United States v. Dorn, 2016 WL 7388658 (W.D. Okla. Mar. 31, 2016).

Below is a count-by-count summary of the verdicts relevant to these proceedings.

C. The Moving Papers and Evidentiary Hearing

The issues addressed in this order are those raised by the moving papers considered as a whole, which are extensive.

The government moved for preliminary orders of forfeiture against defendants King (doc. no. 1493), Koralewski (doc. no. 1975), Tucker (doc. no. 1512, amended motion), Moran (doc. no. 1482), Robles (doc. no. 1887), Zapt (doc. no. 1494), Bramley (doc. no. 1481) and Diebner (doc. no. 1480). Setting defendants Tucker and Zapt aside for the moment (because the government’s motions against these two defendants stand on a slightly different procedural footing, as discussed next), defendants King, Koralewski, Moran, Bramley and Diebner dispute the government’s entitlement to forfeiture of specific property identified in each of these motions. These defendants, plus Robles, also dispute the government’s entitlement to a money judgment against them.

The government’s motions for preliminary orders of forfeiture against Tucker and Zapt have already been granted by agreement, to the following extent. The government’s amended motion for a preliminary order of forfeiture against Tucker was granted (doc. no. 1797), as was the government’s motion for a preliminary order of forfeiture against Zapt. Doc. no. 1798. These motions were granted with respect to the specific property identified in the motions, as to which there was no dispute; however, the government’s entitlement to a money judgment against Tucker remains in dispute, as does forfeiture of one of Tucker’s bank accounts, as explained in Part VIII(A)(3), below. The government has not explicitly sought a money judgment against Zapt. See, doc. no. 1999-7, at 3-4 (describing money judgment sought against Tucker, but stating nothing about a money judgment from Zapt). Furthermore, it does not appear that the government seeks to forfeit any assets of Zapt which have not already been preliminarily forfeited. See, doc. no. 1798 (preliminary order of forfeiture by Zapt of contents of account X0897, in approximate amount of $1,657.94, located at TD Bank, Mount Laurel, NJ, in the name of ZAPT Electrical Sales). Thus, although Zapt was given permission to participate in the forfeiture proceedings along with Tucker, nothing remains to be decided at this stage with respect to Zapt.

After the government filed its motions for preliminary orders of forfeiture, the forfeiture defendants filed response briefs. See, King (doc. no. 1530), Koralewski (doc. no. 1983), Tucker (doc. no. 1548), Moran (doc. no. 1513), Robles (doc. no. 1897), Zapt (doc. no. 1548), Bramley (doc. no. 1523) and Diebner (doc. no. 1525).

Viewed in light of the complexity of these proceedings, the government’s motions were somewhat perfunctory. For example, the motions listed forfeiture statutes from the Superseding Indictment, but they did not specify which particular forfeiture statutes the government invoked in support of particular forfeitures. Notably, the government’s motions seeking forfeitures from King, Koralewski, Tucker, Bramley, Zapt and Diebner did not mention a personal money judgment against these defendants.

On January 19, 2016 (about twelve years after the Legendz investigation started and nearly three years after the April, 2013 takedown in which the government seized hundreds of thousands of records from the defendants), the government filed its opening brief in support of its forfeiture claims. That brief (herein: Forfeiture Brief) was the government’s definitive statement of its forfeiture case. It was filed pursuant to Case Management Order No. 7, doc. no. 1879, which required the government to:

(i) state the statutory basis for the government’s forfeiture claims with respect to each forfeiture defendant, (ii) specifically identify the property sought to be forfeited, as to each forfeiture defendant, (iii) state with reasonable specificity the factual basis on which the government asserts that there is a nexus between the property and the offense(s) of conviction, (iv) specify the amount of any forfeiture money judgment sought against any forfeiture defendant, with a reasonably detailed explanation of the factual basis for the government’s determination of the amount sought, and (iv) address any other relevant matters as set forth in Part F of the Chambers Procedures of the undersigned judge, as found at the court’s website.”

Id. at 1-2.

In its Forfeiture Brief, the government set out, in separate exhibits for each of the forfeiture defendants, the government’s position as it stood heading into the evi-dentiary hearing, regarding the property, and the size of personal money judgments, sought in these proceedings. See, doc. no. 1999-1 (King); doc. no. 1999-5 (Koralewski); doc. no. 1999-7 (Tucker); doc. no. 1999-3 (Moran); doc. no. 1999-8 (Robles); doc. no. 1999-7 (Zapt); doc. no. 1999-2 (Bramley); doc. no. 1999-4 (Diebner).

As already stated, Case Management Order No. 7 also required the government to specify the statutory basis invoked by the government in support of each forfeiture. Per the government’s Forfeiture Brief, the sole statutory basis pressed by the government in support of forfeitures based on RICO conspiracy convictions was 18 U.S.C. § 1963(a). The sole statutory basis pressed by the government in support of forfeitures based on convictions for operating an illegal gambling business was 18 U.S.C. § 1955(d). And the sole statutory basis pressed by the government in support of forfeitures based on money laundering conspiracy convictions was 18 U.S.C. § 982(a)(1). Doc. no. 1999, pp. 11-12.

All of the forfeiture defendants filed briefs in response to the government’s Forfeiture Brief. See, King (doc. no. 2074); Koralewski (doc. no. 2071); Tucker (doc. no. 2077); Moran (doc. no. 2067); Robles (doc. no. 2078); Zapt (doc. no. 2077); Bramley (doc. no. 2075); Diebner (doc. no. 2070).

As required by the court’s order of March 7, 2016, (doc. no. 2082), the government also filed a reply brief to address arguments made by some defendants in their response briefs, contending the government had failed to give adequate notice it intended to seek a personal money judgment. Doc. no. 2101.

An exclusionary rule argument was raised by King in his motion, seeking to exclude the documents commonly referred to as the Karlo Stewart documents. Doc. no. 2169. The government filed a response brief addressing that issue. Doc. no. 2180. (King had previously filed a successful motion to suppress those documents, and they were not admitted into evidence at his jury trial. United States v. King, 212 F.Supp.3d 1113 (W.D. Okla. 2015)).

The government filed pre-hearing proposed findings and conclusions. Doc. no. 2130. The government’s forfeiture claims against the forfeiture defendants now before the court were tried to the court in three days of hearings in late April, 2016. Doc. nos. 2174-76.

Following the hearing, proposed findings of fact and conclusions of law were submitted by all parties. See, doc. no. 2242 (government); doc. no. 2275 (King); doc. no. 2273 (Koralewski); doc. no. 2276 (Tucker); doc. no. 2270 (Moran); doc. no. 2278 (Robles); doc. no. 2276 (Zapt); doc. no. 2315 (Bramley); doc. no. 2274 (Dieb-ner). In addition, the court has permitted the forfeiture defendants to adopt proposed findings and conclusions of the other forfeiture defendants. See adoption orders, doc. no. 2288 (King); doc. no. 2285 (Kora-lewski); doc. no. 2284 (Tucker); doc. no. 2289 (Moran); doc. no. 2286 (Robles); doc. no. 2284 (Zapt); doc. no. 2287 (Diebner). (Bramley did not ask to adopt the other forfeiture defendants’ proposed findings and conclusions, but the court gives him the benefit of the others’ proposed findings and conclusions where applicable to his situation.) At previous stages of the briefing, the forfeiture defendants have also, at times, incorporated each others’ arguments by reference.

II. Authority for Forfeiture

A. Forfeiture Procedures

“As soon as practical after a verdict ... of guilty ... on any count in an indictment ... regarding which criminal forfeiture is sought, the court must determine what property is subject to forfeiture under the applicable statute.” Rule 32.2(b)(1)(A), Fed. R. Crim. P. “If the government seeks forfeiture of specific property, the court must determine whether the government has established the requisite nexus between the property and the offense. If the government seeks a personal money judgment, the court must determine the amount of money that the defendant will be ordered to pay.” Id.

“The court’s determination may be based on evidence already in the record, ... and on any additional evidence or information submitted by the parties and accepted by the court as relevant and reliable.” Rule 32.2(b)(1)(B), Fed. R. Crim. P. “If the forfeiture is contested, ... the court must conduct a hearing after the verdict ... of guilty.” Id.

“If the court finds that property is subject to forfeiture, it must promptly enter a preliminary order of forfeiture setting forth the amount of any money judgment, directing the forfeiture of specific property, and directing the forfeiture of any substitute property if the government has met the statutory criteria.” Rule 32.2(b)(2)(A). “The court must enter the order without regard to any third party’s interest in the property. Determining whether a third party has such an interest must be deferred until any third party files a claim in an ancillary proceeding under Rule 32.2(c).” Id. “Thus, the ancillary proceeding has become the forum for determining the extent of the defendant’s forfeitable interest in the property. This allows the court to conduct a proceeding in which all third-party claimants can participate and which ensures that the property forfeited actually belongs to the defendant.” Advisory Committee Notes, 2000 Adoption, Subdivision (b).

“Unless doing so is impractical, the court must enter the preliminary order sufficiently in advance of sentencing to allow the parties to suggest revisions or modifications before the order becomes final as to the defendant under Rule 32.2(b)(4).” Rule 32.2(b)(2)(B), Fed. R. Crim. P.

“At sentencing — -or at any time before sentencing if the defendant consents — the preliminary forfeiture order becomes final as to the defendant.” Rule 32.2(b)(4)(A), Fed. R. Crim. P. “If the order directs the defendant to forfeit specific property, it remains preliminary as to third parties until the ancillary proceeding is concluded under Rule 32.2(c).” Id.

B. General Principles

These forfeitures are criminal forfeitures. Criminal forfeiture is part of the sentence — punishment—imposed on a defendant who has been convicted in a criminal case. See, Libretti v. United States, 516 U.S. 29, 38-39, 116 S.Ct. 356, 133 L.Ed.2d 271 (1995) (forfeiture is an element of the sentence imposed following conviction). A criminal forfeiture order is an in personam proceeding against a defendant in a criminal case, as distinguished from civil forfeiture which is an in rem proceeding brought against the thing. United States v. $39,000 in Canadian Currency, 801 F.2d 1210, 1218 (10th Cir. 1986); United States v. Vampire Nation, 451 F.3d 189, 202 (3d Cir. 2006).

Criminal forfeitures fall into two categories, forfeiture of property, and forfeiture in the form of a money judgment. See, Rule 32.2(b)(1), Fed. R. Crim. P., and Advisory Committee Notes, 2000 Adoption, Subdivision (b) (“Subdivision (b)(1) recognizes that there are different kinds of forfeiture judgments in criminal cases. One type is a personal judgment for a sum of money; another is a judgment forfeiting a specific asset.”).

The burden rests on the government to establish the nexus between the property forfeited and an offense of conviction that authorizes forfeiture. United States v. Bader, 678 F.3d 858, 894-95 (10th Cir. 2012). This aspect of the matter will receive more attention in Part IV(A), below.

As for money judgments, although the criminal forfeiture statutes in issue in this case do not explicitly refer to money judgments, courts uniformly recognize that money judgments representing unlawful proceeds are appropriate. See, United States v. McGinty, 610 F.3d 1242, 1246 (10th Cir. 2010) (involving a forfeiture of the defendant’s house and proceeds from the sale of his boat and its motor, following defendant’s conviction of misapplication of bank funds; the forfeiture statute involved was 18 U.S.C. § 982(a)(2), which refers to property consisting of or derived from proceeds obtained directly or indirection as a result of the violation).

There are two primary reasons for permitting forfeiture money judgments. First, criminal forfeiture is a sanction against the individual defendant rather than a judgment against the property itself. McGinty, 610 F.3d at 1246, quoting United States v. Hall, 434 F.3d 42 (1st Cir. 2006). Because the sanction follows the defendant as part of the penalty, the government need not prove that the defendant actually has the forfeited proceeds in his possession at the time of conviction. Id. Second, permitting a money judgment as part of a forfeiture order prevents a defendant from ridding himself of his ill-gotten gains to avoid the forfeiture sanction. Id.

The nature of a particular forfeiture order will depend on the relevant forfeiture statute as well as the facts of a given case. Id. at 1248. Hybrid orders which forfeit specific property of a defendant, and which also enter a money judgment against a defendant, may be appropriate and are permitted. Id. at 1248-49.

As will be seen in the portions of this order which address the individual forfeiture statutes relied on by the government in this case, those statutes permit forfeiture of proceeds. Moreover, there is universal agreement that at least the portion of property that derives from proceeds of illegal activity is subject to forfeiture. See, United States v. Rudaj, 2006 WL 1876664, *4, and n.6 (S.D.N.Y. 2006) (stating, in discussion of bank fraud forfeiture under 18 U.S.C. § 982, that “there is universal agreement that at least the portion of the property that derives from proceeds of illegal activity is subject to forfeiture”; and citing United States v. Genova, 333 F.3d 750, 762 (7th Cir. 2003), for the proposition, in a RICO case, that ill-gotten gain is forfeited but value added independently by accused is not forfeitable gain.)

With the exception to be discussed immediately below, the general rule is that joint and several liability applies to forfeitures sought in a multi-defendant case. See, United States v. Contorinis, 692 F.3d 136, 146-47 (2d Cir. 2012) (government sought forfeiture of over twelve million dollars following conviction of conspiracy to commit securities fraud and insider trading; court noted that criminal forfeiture focuses on the disgorgement by a defendant of his ill-gotten gains, citing McGinty for the proposition that the calculation of a forfeiture amount in criminal cases is usually based on the defendant’s actual gain, at 146; court noted this general rule is somewhat modified by the principle that a court may order a defendant to forfeit proceeds received by others who participated jointly in the crime, provided the actions generating those proceeds were reasonably foreseeable to the defendant).

For purposes of this case, the exception to the general rule of joint and several liability is that the doctrine of joint and several liability does not permit the government to forfeit racketeering proceeds under the RICO forfeiture statute, 18 U.S.C. § 1963(a)(3), where the proceeds in question were never “obtained, directly or indirectly” by the particular forfeiture defendant from whom forfeiture is sought. This exception to joint and several liability is addressed later in this order, in connection with the RICO forfeiture statute.

Similarly, it is generally (but not inevitably) true that a court may order a defendant to forfeit proceeds received by others who participated jointly with the defendant in the crime. In these proceedings, however, the government only argues for joint and several liability with respect to the conspiracy convictions.

Moreover, to obtain a money judgment based on joint and several liability for proceeds received by others, at least in the circumstances of this case, a foreseeability requirement must be met so that the government can get a judgment for only so much of the proceeds as were foreseeable to that defendant. Long before the forfeiture trial, the government was on notice that foreseeability was very much in issue. See, Tucker’s forfeiture brief, doc. no. 2077, at 5-6 (filed on February 29, 2016, nearly two months before the forfeiture trial). After the forfeiture trial, in a filing that was adopted by the other forfeiture defendants, Tucker again argued foreseeability, as a legal matter and as a factual matter. Doc. no. 2276, at 23-25, ¶¶ 88-92. But neither the government’s forfeiture brief nor its proposed findings and conclusions address the issue of foreseeability— an issue that is undeniably, and prominently, in the mix as to forfeiture based on money laundering, given the far-flung nature of the Legendz betting operation and the geographic and functional differences among the defendants. The government’s filings make no reference, to say nothing of providing any developed argument, on that issue or as to the burden of proof on that issue (discussed in Part IV, below). Any argument that foreseeability is not required as a prerequisite to joint and several forfeiture liability is therefore waived. However, aside from the government’s waiver, the court concludes that each forfeiture defendant’s exposure to money laundering forfeiture is limited to those transactions that the government proves were foreseeable to that defendant.

As discussed later in this order, at least in the context of this case, joint and several liability does not eliminate eighth amendment concerns; rather, at least arguably, it heightens them. For example, United States v. Jalaram, Inc., 599 F.3d 347 (4th Cir. 2010), involved forfeiture based on convictions for violating, and conspiring to violate, the Mann Act; money laundering; and conspiracy to commit money laundering. In Jalaram, the Fourth Circuit recognized that in single-offender cases, it would be very difficult and perhaps impossible for the defendant to show that the forfeiture of proceeds was disproportionate to the gravity of his offense, which the Fourth Circuit speculated might explain the desire of some of its sister circuits to simplify the analysis by holding such forfeitures exempt from constitutional scrutiny in the first place. Id. at 355. Jalaram states, however, that such a “proposed shortcut may work a grave injustice in cases involving joint and several liability.” Id. The court explained that “[i]n such cases, some defendants inevitably disgorge more money than they received from the conspiracy, thus forfeiting property they obtained lawfully in order to satisfy the forfeiture judgment. In a case where a defendant played a truly minor role in a conspiracy that generated vast proceeds, joint and several liability for those proceeds might result in a forfeiture grossly disproportionate to the individual defendant’s offense.” Id.

Additional legal principles of general application are addressed later, under separate headings. Those topics (including the Excessive Fines Clause, burden of proof, the exclusionary rule, tracing, commingling, extrapolation and double counting, and the sufficiency of the government’s notice of its intention to seek money judgments) address issues raised in the forfeiture defendants’ papers. Before addressing those topics, it is useful to address the specific forfeiture statutes relied on by the government in these proceedings.

C. Forfeitures Based on RICO Conspiracy Convictions

As the statutory authority for forfeitures based on a RICO conspiracy in violation of 18 U.S.C. § 1962(d), the government relies on 18 U.S.C. § 1963(a). Doc. no. 1999, p. 11 (in which government was required to identify all forfeiture statutes invoked). Section 1963(a) provides as follows.

Whoever violates any provision of section 1962 of this chapter ... shall forfeit to the United States, irrespective of any provision of State law—

(1) any interest the person has acquired or maintained in violation of section 1962;

(2) any—

(A) interest in;

(B) security of;

(C) claim against;

(D) property or contractual right of any kind affording a source of influence over;

any enterprise which the person has established operated, controlled, conducted, or participated in the conduct of, in violation of section 1962; and

(3) any property constituting, or derived from, any proceeds which the person obtained, directly or indirectly, from racketeering activity ... in violation of section 1962.

The government’s proposed findings and conclusions cite subsection (3). See, e.g., doc. no. 2242, pp. 57-58, ¶ 237, citing § 1963(a)(3) (the only subsection of the statute expressly cited or quoted in the government’s proposed findings and conclusions). Subsections (1) and (2) (which are quoted in the government’s Forfeiture Brief) provide that a defendant’s conviction under RICO subjects all of his interests in the enterprise to forfeiture. See, United States v. Cauble, 706 F.2d 1322, 1349 (5th Cir. 1983) (punishment imposed by a RICO forfeiture “deprives that defendant of all of the assets that allow him to maintain an interest in a RICO enterprise”; jury may not find that less than the full amount of the defendant’s interest in an enterprise is subject to forfeiture under § 1963). The government’s present exclusive reliance on subsection (3) is understandable. The evidence does not show that there is (or, for a long time, has been) anything left of the Legendz gambling enterprise other than such assets as may be within the reach of subsection (3).

The RICO forfeiture provision is broadly drafted and has long been liberally construed. United States v. Fruchter, 411 F.3d 377, 384 (2d Cir. 2005), cert. denied, 546 U.S. 1076, 126 S.Ct. 840, 163 L.Ed.2d 708 (2005).

Proceeds forfeitable based on a conspiracy to violate RICO potentially include gross proceeds of the RICO conspiracy, not just net profits after expenses. See, United States v. Christensen, 828 F.3d 763, 822-23 (9th Cir. 2016), cert. denied, — U.S. —, 137 S.Ct. 628, 196 L.Ed.2d 517 (2017) (concluding in a RICO forfeiture that “proceeds” means gross receipts, but noting some circuits have held otherwise; affirming the district court’s conclusion that the gross receipts of the investigative agency which was at the center of the criminal enterprise rather than the agency’s profits, were subject to forfeiture under § 1963(a)(3)). Christensen reasoned that legislative history of RICO indicates that “proceeds” was used in lieu of the term “profits” to alleviate the unreasonable burden on the government of proving net profits). Bader, 678 F.3d 858 (10th Cir. 2012), involved a forfeiture based on a conviction for various drug-related crimes involving human growth hormone. Defendant argued that the forfeiture verdict, based on calculation of proceeds from gross drug sales instead of net sales, was improper under United States v. Santos, 553 U.S. 507, 128 S.Ct. 2020, 170 L.Ed.2d 912 (2008). Id. at 892-94. The Court of Appeals held the defendant had waived this argument, but went on to state that Santos should be “confined to its factual setting,” concluding that “ ‘proceeds’ means ‘profits’ for the purpose of the money laundering statute only where an illegal gambling operation is involved.” Id. at 894, quoting United States v. Fishman, 645 F.3d 1175, 1193-94 (10th Cir. 2011), cert. denied, 565 U.S. 1115, 132 S.Ct. 1046, 181 L.Ed.2d 740 (2012). In Bader, the court stated that defendant’s reliance on Santos was misplaced because his convictions involved neither the federal money laundering statute nor an illegal gambling operation. Bader, 678 F.3d at 894. And see, United States v. Miller, 2009 WL 2949784 (D. Kan. 2009), in which the defendant conceded, and the court agreed, that “it is gross receipts that are considered forfeita-ble under federal forfeiture statutes invoking the term ‘proceeds.’ ” Id. at *4. Defendant had argued that “proceeds” under 18 U.S.C. § 982(a)(2) must be interpreted as “profits” under Santos. Id. Rejecting that contention, Miller discussed the legislative history of the Crime Control Act of 1984, pointing out that Congress explained that it used “proceeds” in the RICO forfeiture statute in lieu of the term “profits” in order to alleviate the unreasonable burden on the government of proving net profits. Id. at *5. (Santos is a bit more problematic in the money laundering forfeiture context, and, on that score, will get further discussion in Part E, below.)

As for the issue of joint and several liability for racketeering proceeds, this order has already indicated that although, as a general proposition, joint and several liability (limited by principles of foreseeability and the Eighth Amendment) applies to forfeitures which are based on conspiracy convictions, joint and several liability does not apply to permit forfeiture of racketeering proceeds from a particular forfeiture defendant who never, in any sense of the word, “obtained” those racketeering proceeds. In the court’s view, the “obtained” language in the RICO forfeiture statute, 18 U.S.C. § 1963(a)(3), allows no other conclusion.

In this regard, the undersigned’s reading of the RICO forfeiture statute is the same as the D.C. Court of Appeals’ reading of almost identical language in 21 U.S.C. § 853(a), a drug forfeiture statute, as explained with clarity in United States v. Cano-Flores, 796 F.3d 83 (D.C. Cir. 2015), cert. denied, — U.S. —, 136 S.Ct. 1688, 194 L.Ed.2d 790 (2016). Title 21 U.S.C. § 853(a), like the RICO forfeiture statute, authorizes forfeiture of “proceeds the person obtained, directly or indirectly” as a result of the violation. Cano-Flores is at odds with the majority view, as Cano-Flores recognizes. See, 796 F.3d at p. 91 (discussing the contrary view in other circuits). That said, the undersigned is convinced that to join the majority of courts— which hold that the doctrine of joint and several liability permits forfeiture of racketeering proceeds which were obtained by others, although those proceeds were never obtained by the particular forfeiture defendant in question — would be to read the “obtained, directly or indirectly” language entirely out of the RICO forfeiture statute. In an analysis that is hard to argue with, Judge Williams’s plain language persuasively explains the statute’s equally plain language. Id. at 91-95. And see, United States v. Honeycutt, 816 F.3d 362, 379-80 (6th Cir. 2016) (involving forfeiture of drug proceeds; court follows the majority of courts, and applies joint and several liability among conspirators to forfeiture sought under 21 U.S.C. § 853(a)(1), although noting that Cano-Flores is contra), cert. granted, — U.S. —, 137 S.Ct. 588, 196 L.Ed.2d 462 (2016).

The court’s agreement with Cano-Flores affects the result in these forfeiture proceedings with respect to only one of the forfeiture defendants — Koralewski. This is because the other forfeiture defendants were convicted on the money laundering conspiracy charge, subjecting them to the broader reach of the money laundering forfeiture statutes, none of which include the “obtained” language found in the RICO forfeiture statute. Koralewski, however, was convicted solely on the RICO conspiracy charge.

Eighth amendment limitations are addressed later, in Part III. At this point it is enough to observe that courts have applied an excessive fines analysis to forfeitures that are based on RICO convictions. See, e.g., Rudaj, 2006 WL 1876664 at *8 (under gross disproportionality test of United States v. Bajakajian, 524 U.S. 321, 332, 118 S.Ct. 2028, 141 L.Ed.2d 314 (1998), the forfeiture sought by the government, consisting of over five million dollars and three properties, was not grossly disproportionate to the gravity of the defendants’ offense). Although the “shall” language in the RICO forfeiture statute suggests that forfeitures which meet the statutory requirements are mandatory, this language does not trump eighth amendment limits. See, United States v. Corrado, 227 F.3d 543 at 552 (noting mandatory “shall forfeit” language in RICO forfeiture statute, but stating that although the statute appears to require total forfeiture of illegal proceeds, courts can reduce the forfeiture to make it proportional to the seriousness of the offense so as not to violate the eighth amendment prohibition against excessive fines).

The government need not provide a precise calculation of the proceeds from a RICO enterprise; however, estimates must be conservative, and overly speculative evidence about what constitute proceeds will not support a RICO forfeiture.

[B]ecause it is intended to be a potent means of punishment, the Government need not provide a precise calculation of the proceeds. See United States v. Lizza Industries, Inc., 775 F.2d 492, 498 (2d Cir. 1985) (“RICO does not require the prosecution to prove or the trial court to resolve complex computations, so as to ensure that a convicted racketeer is not deprived of a single farthing more than his criminal acts produced.”). A total amount derived from “conservatively estimating” the revenue regularly collected or received will suffice where the evidence establishes the approximate amounts. Corrado, 227 F.3d at 555. But evidence regarding proceeds that is overly speculative will be insufficient to support a forfeiture award. Id. at 557-58.

Rudaj, 2006 WL 1876664 at *3.

Rudaj strikes the right balance. The court’s reckoning should be conservative in the sense that the evidence should be assessed with some semblance of intellectual rigor, lest loose talk, even under oath (of which there has been no shortage in this case), be allowed to render a defendant a pauper for life. But to-the-penny precision — within the general confines of a result produced by a reasonably rigorous analysis of the evidence — is another issue altogether. That degree of precision is rarely possible and, if required, would hollow out much of the forfeiture legislation.

D. Forfeitures Based on Convictions for Operation of Illegal Gambling Business

As the statutory authority for forfeitures based on operation of an illegal gambling business in violation of 18 U.S.C. § 1955, the government relies on 18 U.S.C. § 1955(d). Doc. no. 1999, p. 12. Section 1955(d) provides that: “Any property, including money, used in violation of the provisions of this section may be seized and forfeited to the United States.”

In addition, although not mentioned in the government’s Forfeiture Brief as required by the court, the government’s proposed findings and conclusions relating to forfeitures based on operation of an illegal gambling business (doc. no. 2242, ¶ 205 at p. 51, ¶ 249 at p. 60), rely on 18 U.S.C. § 981(a)(1)(C). That statute provides that the following property is subject to forfeiture to the United States:

Any property, real or personal, which constitutes or is derived from proceeds traceable to a violation of ... any offense constituting “specified unlawful activity” (as defined in section 1956(c)(7) of this title), or a conspiracy to commit such offense.

Continuing the chain of cross references, § 1956(c)(7) incorporates offenses listed in § 1961(1) (RICO) and § 1961(1) includes, among other things, violations of § 1955 (illegal gambling business).

Proceeds which the government seeks to forfeit based on illegal gambling convictions means gross receipts, not net profits. See, e.g., 18 U.S.C. § 981(a)(2)(A) (“For purposes of paragraph (1) [§ 981(a)(1)] ... [i]n cases involving ... illegal services [or] unlawful activities, ... the term ‘proceeds’ means property of any kind obtained directly or indirectly, as the result of the commission of the offense giving rise to forfeiture, and any property traceable thereto, and is not limited to the net gain or profit realized from the offense.”)

The forfeiture defendants argue that, unlike the forfeiture statutes which the government relies on to support forfeiture based on RICO and money laundering conspiracy convictions, 18 U.S.C. § 1955(d) uses the permissive “may” rather than the mandatory “shall,” so that forfeitures under this statute are not mandatory. For example, Diebner’s response brief (doc. no. 2070, p. 10, responding to the government’s Forfeiture Brief), cites United States v. Premises Known as 318 South Third Street, 988 F.2d 822, 827 (8th Cir. 1998), for the contention that a forfeiture under § 1955(d) is permissive and allows for judicial discretion. That decision held that under the permissive language of § 1955(d), “a court can refuse a forfeiture if it seems to work a disproportionate penalty in light of the peculiar facts of a particular case.” Id. at 828. Thus, arguments regarding the “may” language of § 1955(d) are taken into account in Part III, below (discussion of the Excessive Fines Clause, where disproportionality is considered).

E. Forfeitures Based on Money Laundering Conspiracy Convictions

As the statutory authority for forfeitures based on conspiring to launder money under 18 U.S.C. §§ 1956 and 1957 in violation of § 1956(h), the government relies on 18 U.S.C. § 982(a)(1). Doc. no. 1999, p. 12. Section 982(a)(1) provides as follows:

The court, in imposing sentence on a person convicted of an offense in violation of section 1956, 1957, or 1960 of this title, shall order that the person forfeit to the United States any property, real or personal, involved in such offense, or any property traceable to such property.

As stated in United States v. Bornfield, 145 F.3d 1123 (10th Cir. 1998), cert. denied, 528 U.S. 1139, 120 S.Ct. 986, 145 L.Ed.2d 935 (2000), a case involving forfeiture of funds in the defendant’s bank account following a money laundering conviction, “[t]he key to whether property is forfeitable [under § 982(a)(1)] is whether it was ‘involved in’ or ‘traceable to’ the offense.” Id. at 1135. More about this in Part VI, below.

The forfeiture defendants argue that when the government, seeking forfeiture, relies on transactions it says constituted laundering of illegal gambling proceeds, the transactions are subject to the same Santos date limitation which applied at trial. The court disagrees.

Santos, and the legislation passed soon after that decision to address the definition of “proceeds” as used in 18 U.S.C. §§ 1956 and 1957, created issues in the jury trials in this case concerning which transactions the government could use to prove money laundering or money laundering conspiracy. See generally, doc. nos. 921 and 1247 (Memorandum and Order with Respect to Santos Issues). The government did not prove, either in the jury trials or in forfeiture proceedings, any net profits in the sense required for money laundering transactions involving illegal gambling proceeds prior to May 20, 2009 (that date being the effective date of the legislation, 123 Stat. 1617, § 2, enacted to overrule Santos). Accordingly, in each of the four jury trials in this case, the jury was instructed that, for purposes of Count 3 (and with one exception), it could not consider transactions to be money laundering transactions if those transactions occurred before May 20, 2009. The exception was that the date limitation did not apply to transactions shown to be within the scope of § 1956(a)(2)(A). (Because that statute does not use the term “proceeds,” a conspiracy to violate it does not depend on the Santos definition of “proceeds” as net profits. See, e.g., doc. no. 1206, pp. 85-86, jury instructions used in trial of Robles, Tucker and Zapt.)

In Bader, 678 F.3d 858, the Court of Appeals upheld a $4.8 million proceeds forfeiture following convictions for drug crimes involving human growth hormone. The court rejected defendant’s argument that the calculated forfeiture amount was improperly based on aggregated sales rather than on net sales. Id. at 893-94. Although the court deemed the Santos issue waived, it stated that defendant’s “reliance on Santos is ... misplaced, as his convictions pertain neither to the federal money-laundering statute nor to an illegal gambling operation.” Id. at 894. By contrast, this case involves forfeiture under federal money laundering statutes and the government seeks forfeiture of laundered funds on the basis that they are proceeds of an illegal gambling operation. Therefore, unlike the situation in Bader, Santos remains potentially relevant to the forfeiture issues in this case, but that relevance is probably only theoretical, for this reason: In Santos, the Court was construing the term “proceeds” as found in the relevant money laundering statute, specifically 18 U.S.C. § 1956(a)(1)(a)(i). And, as has been stated, the Court held that “proceeds” meant net profits, not gross receipts, thus causing much confusion in the lower courts, as the Tenth Circuit noted in Bader. Id. at 894. But, in this case, at this juncture, the issue is forfeiture, not criminal liability for money laundering, and the operative words, for the purpose of determining the scope of the forfeiture to which the government is entitled are to be found in the relevant forfeiture statute, specifically 18 U.S.C. § 982(a)(1). Those operative words render forfeitable any property “involved in [the offense of conviction], or any property traceable to such property.” Id. (emphasis added). Money or other property can surely be “involved in” or “traceable to” a money laundering offense without being, in an accounting sense, net profits of a specified unlawful activity. See Cassella, Stefan D., Asset Forfeiture Law in the United States, § 25-4, p. 918 at nn. 63-65 (2d ed. 2013), stating that Santos has no application to civil or criminal forfeiture, presumably meaning that money laundering forfeitures are not limited to net profits. The offense of conviction in Bader was not money laundering and it did not involve gambling. Consequently, the most that can be said about Bader’s take on Santos from the perspective of the defendants in this case is that the Tenth Circuit may have assumed — but clearly did not decide — that Santos would apply to money laundering forfeiture in a gambling case. Furthermore, as a practical matter, the impact of Santos and the date limitation that results from Santos and the legislation overruling that ease is lessened in this case because the government seeks the same funds under other forfeiture statutes.

Per the general rule (which this court has held is not applicable to forfeitures of racketeering proceeds) that joint and several liability applies in the context of forfeitures based on conspiracy convictions (limited by foreseeability and the Eighth Amendment), it is only necessary to note here that courts have applied joint and several liability in the context of forfeitures based on money laundering convictions. See, United States v. Seher, 562 F.3d 1344, 1372-73 (11th Cir. 2009) (it was reasonable to hold defendant liable for all proceeds that were a reasonably foreseeable result of the money laundering conspiracy, regardless of whether he still possessed them; citing United States v. Caporale, 806 F.2d 1487, 1506-09 (11th Cir. 1986), which affirmed joint and several liability for RICO conspirators).

Courts have applied an excessive fines analysis to forfeitures that are based on money laundering conspiracy convictions. See, e.g., United States v. Viloski, 814 F.3d 104 (2d Cir. 2016). Eighth amendment limitations are discussed in the next part of this order. The “shall” language in the statutes which authorize forfeiture based on convictions for conspiring to launder money does not alleviate eighth amendment concerns. See, e.g., United States v. Warshak, 2008 WL 2705044 at **3-5 (S.D. Ohio 2008) (government argued forfeiture of money laundering proceeds was mandatory and not disproportionate, at *3; court found joint and several liability was required where defendants were guilty of conspiracy to launder money, and that money judgment forfeiture did not qualify as excessive given the sophistication of the offenses, the scope and duration of the scheme, and the length of potential prison terms and statutory fines, so that Eighth Amendment was not triggered in that ease, at *5).

F. Forfeiture Based on a Facilitation Theory

The government seeks forfeiture of Bramley’s house on a facilitation theory, arguing that Bramley maintained an office in his residence which he used to conduct illegal gambling activity and to conduct financial transactions involving criminal proceeds. See, Forfeiture Brief, doc. no. 1999-2, p. 6 of 17. The government’s brief contends that the Bramley house was used to “carry out his crime, and clearly used to conceal proceeds of his crime and to conduct financial transactions involving the criminal proceeds.” Id.

At a minimum, a facilitation theory of forfeiture must meet the “substantial connection” test. Cassella, Stefan D., Asset Forfeiture Law in the United States, (2d ed. 2013) § 26-1, p. 938. Courts unanimously hold that “involved in” should be read broadly to include any property used to facilitate the money laundering offense. Id., § 27-7, p. 978. A “facilitating” theory can have a long reach. It is not limited to property that is integral, essential or indispensable to the offense. It can reach property that makes the prohibited conduct less difficult or more or less free from obstruction or hindrance. Id., § 26-3, p. 942. But proving that property made the crime easier to commit or harder to detect is only part of the government’s burden, because many things may make a crime easier to commit in some trivial or incidental way, which is not enough. Id., § 26-4, p. 951. To prevail under the facilitation theory, the government must show that the degree to which the property facilitated the crime was substantial. This is known as the “substantial connection test.” Id.

Thus, to forfeit the Bramley residence on the basis that it was facilitating property with respect to any of the crimes for which Bramley was convicted, there has to be more than an incidental or fortuitous connection between the property and the crime in question; moreover, the connection has to be substantial.

Obviously, whether the proof supports forfeiture of a residence on a facilitation theory of forfeiture is a case-by-case determination based on the evidence before the court, as a review of some cases will show.

In United States v. Iacaboni, 221 F.Supp.2d 104, 115 (D. Mass. 2002) (rev’d in part on other grounds, 363 F.3d 1 (1st Cir. 2004)), the court stated that evidence showing the defendant used a house to promote his gambling business was sufficient to permit forfeiture under § 1955(d). There was evidence that envelopes with money and documents were dropped off and picked up in the garage of the house; that faxes and phone calls related to the enterprise came to and went from the residence; that football tickets were “corrected” on the premises; and that meetings were held in the house. 221 F.Supp.2d at 115. The court said: “Given these facts, the Government would have a strong case for forfeiture of the house under the statute permitting forfeiture of ‘property ... used in violation’ of the gambling statute, 18 U.S.C. § 1955(d), if this provision had been cited in the formal charge.” Id. The court denied forfeiture of the house, however, because the government had not sought forfeiture under that statute, and had, instead, sought forfeiture under 18 U.S.C. § 982(a)(1), the money laundering forfeiture statute. The court held there was no evidence that the house was involved in money laundering. Iacaboni, 221 F.Supp.2d 104, 115-116.

In United States v. Nicolo, 597 F.Supp.2d 342 (W.D.N.Y. 2009), the government sought property which it claimed Nicolo used to facilitate the receipt of illegal payments and to conduct financial transactions with the same funds. Id. at 356. The government asserted that the properties helped maintain an overall appearance of a legitimate business to further the illegal money-laundering activity. Id. The government contended that Nicolo generated invoices using the addresses of the properties as the address of his business, that he faxed invoices from those properties, and that checks were sent to those addresses in payment of those invoices. Id.

The court held that the evidence relied on by the government was more tenuous than the type of 'evidence which courts have used to find that real property is involved in money laundering, citing a Second Circuit decision in which the evidence showed the defendant had deposited the proceeds of his fraud into the business operating accounts of the companies which he ran at the subject premises, and that the premises “served as a conduit for the proceeds of the illegal transactions.” Id., citing States v. Schlesinger, 261 Fed.Appx. 355, 361 (2d Cir. 2008). In Nicolo, the court held that defendant’s acts such as faxing invoices, and use of the properties as a mailing address for his business, were activities which were merely incidental or fortuitous in relation to Nicolo’s offenses. Nicolo, 597 F.Supp.2d at 357. The court stated that even if Nicolo physically wrote checks while at the properties to Roeder, his wife and co-defendant, (which the court noted there was no evidence he did), it would not show that the properties themselves had anything more than a fortuitous, transitory and tangential relationship to the money laundering. Id. at 359. That was not enough to justify forfeiting the properties under § 982(a)(1). Id.

The application of these principles to the proposed forfeiture of Bramley’s house will be addressed in Part IX(J), below.

III. The Excessive Fines Clause

At the outset, it is important to note that, in places, the government’s filings (such as in its Forfeiture Brief, and in its proposed findings and conclusions), acknowledge that the Eighth Amendment’s prohibition against excessive fines limits these forfeitures.

In addition, and alternatively, the court concludes that eighth amendment limitations apply for the reasons stated below.

Criminal forfeitures which proceed against a defendant (as contrasted with civil in rem forfeitures) are designed to punish the offender. United States v. Bajakajian, 524 U.S. 321, 332, 118 S.Ct. 2028, 141 L.Ed.2d 314 (1998). Although the government argued in Bajakajian that the forfeiture of defendant’s currency was constitutional because it involved an instrumentality of the crime, the Court rejected that argument, stating that whether defendant’s currency was an instrumentality was irrelevant; “the forfeiture is punitive, and the test for the excessiveness of a punitive forfeiture involves solely a proportionality determination.” Id. at 333-34, 118 S.Ct. 2028. The Court continued: “The touchstone, of the constitutional inquiry under the Excessive Fines Clause is the principle of proportionality: The amount of the forfeiture must bear some relationship to the gravity of the offense it is designed to punish.... We now hold that a punitive forfeiture violates the Excessive Fines Clause if it is grossly disproportional to the gravity of a defendant’s offense.” Id. at 334, 118 S.Ct. 2028.

Some courts and commentators describe the Tenth Circuit as holding that forfeitures of criminal proceeds are not subject to an excessive fines clause analysis. Based on Bajakajian and the authorities cited below, the undersigned disagrees with those descriptions. A case often cited as indicating the Tenth Circuit does not apply the Excessive Fines Clause to criminal forfeitures is United States v. One Parcel of Real Property Described as Lot 41, Berryhill Farm Estates, 128 F.3d 1386 (10th Cir. 1997), a civil forfeiture case involving drug proceeds. In Berryhill, the government sought forfeiture of, among other things, personal property located in the home of the defendant. According to the government, the defendant’s property had been obtained with proceeds traceable to exchanges of controlled substances and was therefore forfeitable under 21 U.S.C. § 881(a)(6). Id. at 1389. Berryhill is a pre-Bajakajian decision. Berryhill holds “as a matter of law that forfeiture of drug proceeds pursuant to § 881(a)(6) can never be constitutionally excessive.” Id. at 1395. Berryhill reasons as follows. “Because the amount of proceeds produced by an individual drug trafficker is always roughly equivalent to the costs that drug trafficker has imposed on society, the forfeiture of those proceeds can never be constitutionally excessive.” Id. at 1395-96. “Therefore, the forfeiture is proportionate as a matter of law and [defendant’s] Eighth Amendment objection is rejected.” Id. at 1396. Thus, Berryhill simply held, in a pre-Baja-kajian context, and in a case in which the government sought personal property obtained by the defendant with drug proceeds, that eighth amendment concerns were satisfied as a matter of law. Berryhill does not preclude an excessive fines clause analysis in these post-Bajakajian proceedings, either by its terms or under its rationale.

Moreover, civil forfeiture cases decided post-Bajakajian suggest the Tenth Circuit Court of Appeals would recognize that eighth amendment arguments apply.

The undersigned concludes that the Eighth Amendment applies.

The next question is; what criteria should this court use to determine whether a particular proposed forfeiture is grossly disproportionate to the gravity of the defendant’s offense? Some general observations, as well as some specific criteria set out in Bajakajian, help answer that question.

First, it is important to note that the test is applied in an individualized manner, because it requires comparing the amount of the forfeiture to the gravity of the defendant’s offense. See, Bajakajian, 524 U.S. at 336-37, 118 S.Ct. 2028 (“If the amount of the forfeiture is grossly disproportional to the gravity of the defendant’s offense, it is unconstitutional.”). Id. at 336-37, 118 S.Ct. 2028. Especially in a multi-defendant case like this one, this focus on the particular defendant’s offense is of more than passing importance. For example, as the court has previously noted, “the federal criminal offense of conspiracy to launder money does not require much more than bad thoughts.” United States v. Bramley, 2015 WL 12852048, at *8 (W.D. Okla. Sept. 16, 2015). For purposes of evaluating the gravity of criminal conduct, the statutory offens