United States District Court, S.D. Florida
ORDER DENYING DEFENDANT'S MOTION TO ACQUIT ON THE
N. Scola, Jr. United States District Judge.
matter is before the Court upon Defendant Philip
Esformes's Motion to Acquit on the Forfeiture Verdicts
(ECF No. 1325). For the reasons set forth
below, the motion is denied.
April 9, 2019, the jury returned a forfeiture verdict finding
the Defendant's interests in seven operating companies
was forfeitable. (ECF No. 1263.) Esformes now asks this Court
to acquit him on the jury's verdict forfeiting his
interests in the operating companies. (ECF No. 1325.)
Esformes presents two arguments in his motion. First, he
argues that forfeiture of “interests in” the
operating companies is unauthorized under the money
laundering forfeiture provisions at issue in this case, 18
U.S.C. § 982(a) and 21 U.S.C. § 853. (Id.
at 3.) Section 982(b)(1) incorporates the provisions of 21
U.S.C. § 853. See 18 U.S.C. § 982(b)(1)
(“The forfeiture of property under this section,
including any seizure and disposition of the property and any
related judicial or administrative proceeding, shall be
governed by . . . [21 U.S.C. 853].”). According to
Esformes, under Section 853, the Government can only seek
forfeiture of “interest in” property pursuant to
Section 853(a)(3), which only applies to violations of RICO
and continuing criminal enterprise offenders. (ECF No. 1325
at 3.) Because the government is seeking forfeiture against
Esformes based on money laundering offenses under 21 U.S.C.
§§ 853(a)(1) and (2), “interests in”
forfeiture is not permissible.
Government responds by arguing that 21 U.S.C. § 853(a)
does not apply. (ECF No. 1338 at 5.) By its express terms,
Section 853(a) applies to “any person convicted of a
violation of this subchapter[.]” 21 U.S.C. §
853(a). Because Esformes was not convicted of a drug crime
under Title 21, this statute does not apply. (ECF No. 1338 at
Court finds that neither party has properly characterized the
relationship between 18 U.S.C. § 982(a) and 21 U.S.C.
§ 853. Section 982(a)(1) states that the Government may
seek forfeiture of “any property, real or personal,
involved in such offense, or any property traceable to such
property.” Section 853(a) states that the Government
may seek “(1) property constituting, or derived from,
any proceeds the person obtained, directly or indirectly, as
the result of such violation; (2) any of the person's
property used, or intended to be used, in any manner or
party, to commit, or to facilitate the commission of such
violation[.]” If both of these applied, as argued by
Esformes, there would be an inconsistency in the standards
used to evaluate what is subject to forfeiture. Under one
statute, the standard is “involved in” or
“traceable to, ” whereas under the other statute,
it could be “derived from” or used to
“facilitate” the crime. On the other hand, the
Government's argument, that Section 853 does not apply at
all, would render 18 U.S.C. § 982(b)(1) superfluous.
See Griffith v. United States, 206 F.3d 1389, 1395
(11th Cir. 2000) (“we disfavor interpretations of
statutes that render language superfluous”). The Court
declines to adopt either interpretation.
U.S. v. Kirshenbaum, 156 F.3d 784, 791 (7th Cir.
1998), the court held that Section 982(b)(1)'s
“incorporation of various subsections of § 853
incorporates those provisions' procedures but applies
them only to the designated forfeitures under § 982(a)
rather than under § 853(a).” Although not an
explicit holding, the Eleventh Circuit has also indicated
that only the procedural portions of Section 853 are
applicable to forfeiture under Section 982(a). In U.S. v.
McCorkle, the Eleventh Circuit noted that the subject
property was “forfeited under § 982(a)(1) and any
judicial proceeding relating to the
forfeiture are governed by 21 U.S.C. § 853[.]” 321
F.3d 1292, 1294 n.2 (11th Cir. 2003) (emphasis added). In
U.S. v. Guerra, the Eleventh Circuit also noted that
for forfeiture under a subsection of Section 982,
“forfeiture proceedings under this
provision are governed by 21 U.S.C. § 853.” 216
Fed. App'x 906, 909 (11the Cir. 2007) (emphasis added).
Based on this language, the Court finds that Section
982(b)(1) only incorporates the procedural elements of
Section 853, and not the substantive description of what is
subject to forfeiture found in Section 853(a). Accordingly,
the Government may seek forfeiture of Esformes's
interests in the operating companies under 18 U.S.C.
next argues that the minority operating company interests
were not “involved in” money laundering and
therefore not subject to forfeiture. (ECF No. 1325 at 4.)
“Property eligible for forfeiture under 18 U.S.C.
§ 982(a)(1) includes that money or property which was
actually laundered (“the corpus”), along with any
commissions or fees paid to the launderer[ ] and any property
used to facilitate the laundering offense.” U.S. v.
Seher, 562 F.3d 1344, 1368 (11th Cir. 2009) (quotation
marks and citations omitted). The parties agree that the
Government's theory of forfeiture is based on the
“facilitation” prong. (See ECF No. 1325
at 5 and ECF No. 1338 at 8.) “Property would
facilitate an offense if it makes the prohibited conduct less
difficult or more or less free from obstruction or
hindrance.” Seher, 562 F.3d at 1268 (quotation
marks and citations omitted). In Seher, the Eleventh
Circuit held that the defendant's interest in the
inventory of the jewelry stores was subject to forfeiture
because “Seher used telephone, business cards, and
other company property to create a façade of
legitimacy[.]” Id. at 1369. Here, like in
Seher, Esformes's operating companies gave his
business a façade of legitimacy as he used them to
hold bank accounts and operate the various SNFs and ALFs
engaged in the elaborate money laundering and kickback
scheme. Accordingly, the Court finds that there is sufficient
evidence to “permit a reasonable jury to conclude that
the Government has proven, by a preponderance of the
evidence, that the property is subject to forfeiture.”
United States v. Armstrong, 2007 WL 809508, at *2
(E.D. La. Mar. 14, 2007).
the Court denies the Defendant's motion
to acquit on the forfeiture verdicts (ECF No.
 To the extent that Esformes is arguing
that the word “property” does not include the
Defendant's interest in a company, the Court rejects that
argument. The Defendant cites no case law for the proposition
that property means only property that is owned 100% by the
Defendant or does not include business or shareholder
interests. In fact, Section 853, the statute that Esformes
argues should apply, defines property as “(2) tangible
and intangible personal property, including ...