Supreme Court Clears Up Forfeiture in Drug Cases

(CN) – The Supreme Court settled a circuit split Monday and ruled that a store manager convicted of selling products to make drugs is not required to forfeit store profits because he didn’t personally benefit from the sales.

Terry Michael Honeycutt worked at his brother’s Brainerd Army Store in Chattanooga, Tenn. In 2008, he contacted local police because he was concerned about “edgy looking folks” buying Polar Pure, an iodine-based water purification product, according to court records.

Tommy Farmer, director of the Tennessee Meth and Pharmaceutical Task Force, told Honeycutt that Polar Pure was being used in the area to make methamphetamine. Farmer then told the police department and the Drug Enforcement Agency that Honeycutt was selling Polar Pure.

The DEA began investigating in 2009 and executed a search warrant the next year. The search found that Polar Pure was the store’s highest-grossing item, generating more than $269,000 in profit from the sale of over 20,000 bottles.

Agents seized the store’s 307 bottles of Polar Pure and the store closed after execution of the search warrant.

Honeycutt went to trial and was convicted of 11 charges related to selling iodine in violation of federal law. He was sentenced to concurrent terms of 60 months in prison for each count.

The district court that sentenced Honeycutt declined to order any forfeiture, finding that he did not reap the proceeds of the conspiracy as a salaried employee.

The Sixth Circuit affirmed Honeycutt’s convictions last year, but vacated his sentences and remanded the case for the district court to reconsider a forfeiture order, citing its 2000 decision in United States v. Corrado.

Honeycutt appealed last summer, arguing in a petition for a writ of certiorari that the U.S. Supreme Court should resolve a conflict between the Sixth Circuit’s decision and a contrary one made by the D.C. Circuit in 2015’s United States v. Cano-Flores ruling.

Six months after agreeing to take up the case, the Supreme Court ruled Monday that Honeycutt is not subject to a forfeiture order because he had no ownership interest in his brother’s store and did not personally benefit from the sales of Polar Pure.

“Because Honeycutt never obtained tainted property as a result of the crime, [21 U. S. C.] §853 does not require any forfeiture,” Justice Sonia Sotomayor wrote for the high court, which reversed the Sixth Circuit’s order.

Sotomayor added, “Section 853(p)(1) demonstrates that Congress contem­plated situations where the tainted property itself would fall outside the government’s reach. To remedy that situation, Congress did not authorize the government to confiscate substitute property from other defendants or co-conspirators; it authorized the government to confiscate assets only from the defendant who initially acquired the property and who bears responsibility for its dissipation.”

All other Supreme Court justices joined Sotomayor in her opinion, except for Justice Neil Gorsuch, who took no part in the consideration or decision of the case.

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