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    United States v. Seventeen Thousand, Four Hundred Dollars in Currency, and Ronald A. Nocenti, Claimant-Appellant, 524 F.2d 1105, 10th Cir. (1975)

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    This dissenting opinion disagrees with the majority's conclusion that Ronald Nocenti was not an agent of the United States government. The dissent argues that Nocenti was acting on behalf of the U.S. government, not Smaldone and Merkowitz, when he traveled to Peru with $18,500 to purchase cocaine. Nocenti was accompanied by a government agent and helped obtain evidence against Smaldone and Merkowitz. Prior cases have found informants to be agents of the government for purposes of entrapment defenses. Therefore, the dissent concludes Nocenti should be considered an agent of the U.S. government, not entitled to the remaining $17,400.

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    United States v. Seventeen Thousand, Four Hundred Dollars in Currency, and Ronald A. Nocenti, Claimant-Appellant, 524 F.2d 1105, 10th Cir. (1975)

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    This dissenting opinion disagrees with the majority's conclusion that Ronald Nocenti was not an agent of the United States government. The dissent argues that Nocenti was acting on behalf of the U.S. government, not Smaldone and Merkowitz, when he traveled to Peru with $18,500 to purchase cocaine. Nocenti was accompanied by a government agent and helped obtain evidence against Smaldone and Merkowitz. Prior cases have found informants to be agents of the government for purposes of entrapment defenses. Therefore, the dissent concludes Nocenti should be considered an agent of the U.S. government, not entitled to the remaining $17,400.

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    Filed: 1975-10-17 Precedential Status: Precedential Citations: 524 F.2d 1105 Docket: 74-1638

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    This dissenting opinion disagrees with the majority's conclusion that Ronald Nocenti was not an agent of the United States government. The dissent argues that Nocenti was acting on behalf of the U.S. government, not Smaldone and Merkowitz, when he traveled to Peru with $18,500 to purchase cocaine. Nocenti was accompanied by a government agent and helped obtain evidence against Smaldone and Merkowitz. Prior cases have found informants to be agents of the government for purposes of entrapment defenses. Therefore, the dissent concludes Nocenti should be considered an agent of the U.S. government, not entitled to the remaining $17,400.

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    37 views7 pages

    United States v. Seventeen Thousand, Four Hundred Dollars in Currency, and Ronald A. Nocenti, Claimant-Appellant, 524 F.2d 1105, 10th Cir. (1975)

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    This dissenting opinion disagrees with the majority's conclusion that Ronald Nocenti was not an agent of the United States government. The dissent argues that Nocenti was acting on behalf of the U.S. government, not Smaldone and Merkowitz, when he traveled to Peru with $18,500 to purchase cocaine. Nocenti was accompanied by a government agent and helped obtain evidence against Smaldone and Merkowitz. Prior cases have found informants to be agents of the government for purposes of entrapment defenses. Therefore, the dissent concludes Nocenti should be considered an agent of the U.S. government, not entitled to the remaining $17,400.

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    of 7

    524 F.

    2d 1105

    UNITED STATES of America, Plaintiff-Appellee,


    v.
    SEVENTEEN THOUSAND, FOUR HUNDRED DOLLARS IN
    CURRENCY, Defendant,
    and
    Ronald A. Nocenti, Claimant-Appellant.
    No. 74-1638.

    United States Court of Appeals,


    Tenth Circuit.
    Argued May 2, 1975.
    Decided Oct. 17, 1975.

    Michael F. Scott, Scott, Goddard & Bush, Denver, Colo. (of counsel:
    Hugh M. Siegman, Santa Monica, Cal.), for claimant-appellant.
    Douglas D. Doane, Asst. U. S. Atty., and James L. Treece, U. S. Atty.,
    Denver, Colo., for plaintiff-appellee.
    Before LEWIS, Chief Judge, and BARRETT and DOYLE, Circuit
    Judges.
    LEWIS, Chief Judge.

    This case has a completely unique but undisputed factual background. Nocenti,
    described by the government as "a cooperating individual for the plaintiff
    United States of America," obtained from two illicit drug dealers in Denver,
    Colorado, Merkowitz and Smaldone, the sum of $18,500 for the purpose of
    buying, in Peru, as much cocaine as possible and smuggling the contraband
    drugs back to Denver. With the full cooperation of the Bureau of Narcotics and
    Dangerous Drugs, Nocenti, accompanied by a narcotics agent, flew to Lima
    with the money for the purpose of making the purchase. The government of
    Peru was informed of the venture and, when Nocenti made the purchase,
    arrested the seller but allowed the United States to complete the plan by
    releasing the cocaine to this government. The money was never paid to the

    seller and remained in Nocenti's possession.


    2

    Nocenti and the narcotics agent then returned to the United States. The agent
    was in possession of the cocaine and Nocenti in possession of the money, the
    amount then being $17,400 with the difference having been spent for expenses
    by Nocenti. Upon reaching Denver, at the government's request, Nocenti turned
    over the remaining money to the United States and was given an evidentiary
    receipt.

    Merkowitz and Smaldone were later "set up," arrested, and subsequently
    convicted of trafficking in narcotics with Nocenti as a key prosecution witness.
    These events occurred in 1972.

    In 1973, the United States filed a complaint in rem against the $17,400 alleging
    the money to be in the custody of the Bureau of Narcotics and Dangerous
    Drugs, Denver, Colorado, and within the jurisdiction of the District Court for
    the District of Colorado and asserting a right to forfeiture under 19 U.S.C.
    1595a. Notice was given to the Bureau of Narcotics and Dangerous Drugs,
    Smaldone, Merkowitz, and Nocenti. The Bureau and Smaldone filed no claim.
    Merkowitz filed a claim after the case was heard and submitted to the trial
    court which was then rejected as untimely. Nocenti was the only appearing
    claimant.

    The trial court held that the money was not subject to forfeiture and dismissed
    the government's complaint in this regard as part of the court's over-all
    judgment. No appeal has been taken by the government from this holding. The
    court also held that Nocenti did not prove ownership of the funds and thus
    denied his claim. The court further held that Nocenti was the agent of the
    United States during the entire course of the transaction and concluded that the
    money belonged to the United States under this finding and theory. Nocenti
    appeals from this holding and the denial of his own claim.

    Nowhere in the proceedings below did the United States ever assert that
    Nocenti was its agent nor are we referred to any case where the government has
    formally or informally asserted that an informer was a lawful agent of the
    United States or has accepted responsibility for the actions of an informer as his
    principal. To the contrary, the United States has consistently refused
    responsibility for the actions of informers in cases involving entrapment and
    various other aspects of criminal activities. See United States v. Spivey, 10 Cir.,
    508 F.2d 146, cert. denied, 421 U.S. 949, 95 S.Ct. 1682, 44 L.Ed.2d 104. We
    are not inclined to transform a government designated "cooperating individual"

    into an agent simply because of the unusual history we here review. The record
    does not support the trial court's finding of agency.
    7

    Viewed traditionally, Nocenti was the agent of Merkowtiz and Smaldone. And
    in light of the serious criminality involved the law will require no accounting of
    this agent to his principals. Restatement (Second) of Agency 412(2)(b)
    (1958). We are left, then, with Nocenti as a witness who surrendered possession
    of evidence to the Bureau of Narcotics and Dangerous Drugs at the Bureau's
    request and who now seeks its return to his possession. His claim is unusual,
    dramatic, but valid.

    The judgment is reversed and the case remanded with directions to order the
    total money surrendered to Nocenti. During the course of this litigation we
    ordered the $17,400 to be deposited with the Clerk of the Court and placed in
    an interest paying account. As part of the mandate it is ordered that the Clerk
    forthwith withdraw the deposit and interest and deliver the total money to the
    Clerk of the District Court.

    DOYLE, Circuit Judge (dissenting).

    10

    I respectfully dissent.

    11

    This cause is an offshoot of a criminal prosecution against Eugene L.


    Smaldone, defendant-appellant, and one Larry A. Merkowitz, both of whom
    were convicted of conspiring to import cocaine. Our opinion in United States v.
    Smaldone, 484 F.2d 311 (10th Cir. 1973) contains a statement of the
    background facts and we need not recount them except to note that Smaldone
    and Merkowitz each gave to the present claimant $9,250. This had two
    ostensible purposes and one actual purpose. The former were to purchase as
    much cocaine as possible on behalf of Smaldone and Merkowitz and, secondly,
    to smuggle this cocaine into the United States for delivery to Smaldone and
    Merkowitz. The actual purpose of the purchase of the cocaine was to bring
    about the arrest and conviction of Smaldone and Merkowitz. In our opinion we
    noted in respect to the claimant Nocenti "the witness in question was a paid
    government informant."

    12

    The majority opinion expresses uncertainty as to whether Nocenti acted as an


    agent of the government. The evidence at the Smaldone-Merkowitz trial clearly
    establishes that Nocenti journeyed to Peru with the money that is now before us
    for one purpose and that was to bring back some cocaine so that it would be
    delivered to Smaldone and Merkowitz and provide evidence against them. It

    seems clear to this writer that Nocenti was acting on behalf of the United States
    Government. In fact, a government agent accompanied him on the trip to Peru.
    He had the assistance of government agents in getting the cocaine into the
    United States. He readily delivered the remaining funds to the government
    agents for evidence after he arrived: So then since he was not acting on behalf
    of Smaldone and Merkowitz he had to be acting on behalf of the government,
    and his obtaining of this money was certainly not on his own behalf.
    13

    The entrapment cases recognize an agency in that they impute the acts of the
    informant to the government. See, e. g., United States v. Hampton, 507 F.2d
    832 (8th Cir. 1974), cert. granted, 420 U.S. 1003, 95 S.Ct. 1445, 43 L.Ed.2d
    761 (1975); United States v. Conway, 507 F.2d 1047 (5th Cir. 1975); United
    States v. Bueno, 447 F.2d 903 (5th Cir. 1971); United States v. Test, 486 F.2d
    922 (10th Cir. 1973).

    14

    In United States v. Gomez-Rojas, 507 F.2d 1213 (5th Cir. 1975), the Fifth
    Circuit ruled that the acts of a paid informant, even if acting on his own
    initiative, are to be imputed to the government. Further, they are to be imputed
    to the government in a situation in which the paid informer is not acting on his
    own initiative but is acting at the behest of the government. Courts have
    sometimes referred to an informer as the government's agent. See, e. g., United
    States v. Waddell, 507 F.2d 1226, 1228 (5th Cir. 1975), where the court said:
    "The law is that Smith, if he was a paid Government informer, could entrap
    Waddell, even though no Government officer knew of Smith's actions, because
    the Government is deemed to have constructive knowledge of such chicanery;
    the defense of entrapment cannot be defeated because the trapping was
    perpetrated by a Government surrogate." See also United States v. West, 511
    F.2d 1083 (3rd Cir. 1975), wherein it was said:

    15 case is unusual in that the uncontradicted evidence shows a confederation of


    This
    two government agents, one an informer who, according to uncontradicted
    testimony, actually supplied the narcotics in question and the other an undercover
    officer who, as prearranged with the informer, bought this contraband from the
    accused third person whom the informer had persuaded to join with him in a selling
    venture.
    16

    511 F.2d at 1085.

    17

    And see United States v. Leon, 487 F.2d 389 (9th Cir. 1973). There the court
    said:

    The practice of the Government in employing agent-informers in narcotics cases is


    18

    well known. We also know that such agents are usually not trained officers . . .487
    F.2d at 392, quoting Velarde-Villarreal v. United States, 354 F.2d 9, 13 (9th Cir.
    1965).
    19

    See also United States v. Hoffa, 385 U.S. 293, 311, 87 S.Ct. 408, 17 L.Ed.2d
    374 (1966).

    20

    In Jencks Act cases a conversation of a defendant with an informer is not


    always regarded as a conversation with a government agent for the purpose of
    determining whether the statement is discoverable under 18 U.S.C. 3500(e).
    See, e. g., United States v. Hoffa, 437 F.2d 11 (6th Cir. 1971), cert. denied, 402
    U.S. 988, 91 S.Ct. 1664, 29 L.Ed.2d 154 (1971). There are Second Circuit
    cases which at least state in dictum that a conversation with an informant is a
    conversation with a government agent for purposes of the Jencks Act. See
    United States v. Birnbaum, 337 F.2d 490, 497-98 (2d Cir. 1964); United States
    v. Crisona, 416 F.2d 107, 113 (2d Cir. 1969), cert. denied, 397 U.S. 961, 90
    S.Ct. 993, 25 L.Ed.2d 253 (1960) (discussing Birnbaum).

    21

    In the present context I find no difficulty in concluding that Nocenti was acting
    as a government agent for the purpose of purchasing the narcotics and
    delivering them to Smaldone. As a consequence, the government has a better
    right than Nocenti even if we were to assess the matter relatively. A further
    consequence flowing from the fact that he was acting for the government is that
    he could not have possession of the money for his own benefit.

    22

    How this money is to be treated appears to be governed by 28 U.S.C. 2042,


    which is a provision dealing with withdrawal of monies deposited in court. The
    section provides:

    23 money deposited shall be withdrawn except by order of court. In every case in


    No
    which the right to withdraw money deposited in court has been adjudicated or is not
    in dispute and such money has remained so deposited for at least five years
    unclaimed by the person entitled thereto, such court shall cause such money to be
    deposited in the Treasury in the name and to the credit of the United States. Any
    claimant entitled to any such money may, on petition to the court and upon notice to
    the United States attorney and full proof of the right thereto, obtain an order
    directing payment to him.
    24

    The money ended up in the possession of the Bureau of Narcotics and


    Dangerous Drugs (BNDD). However, it was ordered to be paid into the court in
    the course of the proceedings before this court. Being in the nature of an

    interpleader action, it should have been ordered by the district court to be


    deposited pursuant to 28 U.S.C. 1335(a)(2).
    25

    Section 2042, supra, requires that one seeking money which is in the
    possession of the court must fully prove his right thereto. He can succeed only
    if he establishes independent good title1 (as distinguished from a lack of title in
    somebody else or a right in comparison with another). The fact then that the
    government cannot establish that the money ought to be forfeited does not
    mean that Nocenti thereby has some semblance of title. It seems clear to us that
    since Nocenti obtained these funds from Smaldone and Merkowitz for the
    purpose of buying and smuggling in cocaine, and in view of the fact that this
    purported conspiracy was a sham and a fraud inasmuch as he was in truth acting
    for the government, it cannot be said that he was in any sense an agent for
    Smaldone and Merkowitz. He may have been some manner of bailee, but this
    does not confer any title on him either. In fact, it is inescapable that Nocenti
    had no title and acquired none. He had at most possession, but this was as a
    representative of the United States. He had no independent right; had not a
    single stick in the so-called bundle of property rights. For this court then to
    transfer the money to him would aid him in carrying out an invalid conversion
    of the funds to his own use.

    26

    Finally, I see no necessity for hastening to relinquish this sum of money. Let
    the law take its course pursuant to 28 U.S.C. 2042. The deposit in the
    Treasury of the United States does not act as an escheat. A claimant with title
    does not lose it thereby.

    27

    The really objectionable aspect to me is that the court is lending its aid to one
    who has no legal right to the award but, more important, the court is going to
    the assistance of a wrongdoer-a converter.

    28

    I submit, therefore, that it would be better to allow the informer to get his
    compensation in the manner provided by statute, in the Comprehensive Drug
    Abuse Prevention and Control Act of 1970, which authorizes the Attorney
    General to pay an informer such sum or sums of money as he may deem
    appropriate. 21 U.S.C. 886(a). This court does not have any authority to
    award compensation to an informer and it should not take it upon itself to do so.

    29

    In sum, then, since Nocenti was a representative of the government, whereby


    he acted for it, his acts were imputed to the government and the government's
    right was superior to his.

    30

    Secondly, the money should not be given to Nocenti by court decree. It should
    be held for the true owner or ultimately inherited by the United States
    Treasury.

    Hansen v. United States, 340 F.2d 142 (8th Cir. 1965); United States for Use of
    Home Indemnity Co. v. American Employers' Ins. Co., 192 F.Supp. 873
    (D.N.D.1961); cf. United States v. Chapman, 281 F.2d 862 (10th Cir. 1960)
    (same standard in case of interpleader)

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