In appeals court hearing, judges criticize case of Phoenix police seizing man's $39,500

Oral arguments commenced on Tuesday morning in the Arizona Court of Appeals for a civil forfeiture case where Phoenix police seized $39,500 in cash from a man without submitting criminal charges against him.

In the hearing, three judges repeatedly questioned and criticized a Maricopa County attorney's argument against Jerry Johnson, one of them at one point referring to the process of civil forfeiture, or RICO, as "distasteful."

“I’m sorry if it seems harsh that the state should actually have to come forward with evidence before it takes people’s money away at the airport,” the Honorable Peter Swann said.

Civil forfeiture has drawn sharp criticism over the years as it has often allowed law enforcement to seize assets like money and property without needing to charge the owners with a crime — much less obtain a conviction.

Supporters of civil forfeiture reform often argue that the cost to hire an attorney and attempt to get the assets back is often more expensive than the seized assets. Some say law enforcement agencies being able to collect and spend money from the assets they seize then creates a financial incentive to seize as much as possible.

The hearing comes a month after the 9th U.S. Circuit Court of Appeals ruled in favor of a couple attempting to get their car back after it was seized in Arizona and a few months after the Legislature passed a law that brought sweeping reforms to civil forfeiture law in the state.

Phoenix police took man's $39,500 in airport last year

Jerry Johnson had flown from Charlotte, North Carolina, in August 2020 to purchase a third semitruck for his small shipping company. Johnson had found a posting for a truck he wanted at a Phoenix-based auction and flew to Phoenix Sky Harbor International Airport with $39,500 in cash — $7,500 in his carry-on backpack and $32,000 in boxes he had packed in his checked luggage.

Johnson previously told The Arizona Republic he chose to travel with cash to avoid incurring fees from withdrawing it outside his usual bank and had found articles that said traveling with large amounts of cash was perfectly legal.

Phoenix police officers approached Johnson as he was retrieving his luggage and interrogated him as to the purpose behind the large sum of cash he had brought with him. Johnson explained he intended to purchase a truck for his business.

An officer eventually accused Johnson of being involved in criminal activity and coerced him into signing a waiver form or go to jail.

Johnson previously told The Republic he didn’t understand what he was signing at the time but later learned it was a waiver form indicating the money he had brought with him wasn’t his. Johnson was free to go after signing the form, but his money remained in police custody.

Johnson hired an attorney to get his money back and provided bank statements and tax returns but the court still deemed the evidence was insufficient. He later contacted the Virginia-based libertarian nonprofit called Institute for Justice, which has written about and litigated civil-forfeiture cases.

The lower court ruled that it was more likely Johnson was involved in illegal activity than not and ruled against him.

The nonprofit learned more about Johnson’s case and agreed to appeal the lower court’s decision.

Judge: 'The Legislature fixed what is a very distasteful process'

Alexa Gervasi, an attorney with Institute for Justice, represented Johnson at the Tuesday hearing and argued that the lower court shifted the burden of proof to Johnson, relieving the government of its burden to prove Johnson’s property was subject to forfeiture.

Dallen Gardner, an attorney representing the Maricopa County Attorney’s Office, disagreed that the lower court erred in its decision. Gardner asserted that Johnson did not own the money, but told the three-judge panel that the money’s owner was unknown.

When asked how he knew the money wasn’t Johnson’s, Gardner said the money didn’t appear to come from Johnson’s business bank account and that Johnson didn’t know exactly how much money he had at the time.

“I don’t know how much I have in my wallet,” Swann replied. “Do you need to check it? Should I be worried that the police are going to come check it? Am I going to have to explain where I got it?”

Gardner then said the money smelling like marijuana was also a factor in seizing it from Johnson, though Swann critiqued that point as well, saying that money travels through different parties and smell or traces of substances on the bills don’t necessarily mean it’s being used in illicit activity.

“It's very hard for me to imagine impregnating $40,000 with marijuana smell,” Swann said.

The somewhat heated argument then turned to whether the government could prove not whether Johnson had obtained the money through illicit means, but whether he was merely an agent transporting the money on behalf of someone else and not its actual owner.

Gardner maintained that Johnson was not the owner and that someone transporting money that wasn’t theirs could lie about owning it to keep it from being forfeited.

“All you would have to do is get a money mule who’s never going to disclose who the agent is and boom — he says it’s his and you’re stuck,” Gardner said.

Gardner’s point didn’t receive much sympathy.

Gardner began arguing that it fell under civil forfeiture law when Swann noted that the law had since changed.

“I will note the law has evolved since this case and the Legislature fixed what is a very distasteful process," Swann said.

After the hearing, Gervasi told The Arizona Republic that she was cautiously optimistic that the Arizona Court of Appeals would rule in Johnson’s favor.

“We think that the court had clearly read all of the briefs and had looked at the lower court’s opinion very closely and was asking really good questions of the government,” Gervasi said. “For instance, if Jerry’s not the owner — who is? And the government absolutely had no answer.”

Gervasi also said the Arizona Court of Appeals' ruling was significant as it could set the precedent for the burden of proof the government must show when arguing in civil forfeiture hearings.

"You never shift the burden over to the claimant to prove his own innocence," Gervasi said. "Even after these reforms, that is still a very important message of law."

Johnson, who was present at the hearing, told The Republic that he felt the proceeding went well and thanked the Institute for Justice for arguing on his behalf. He said he simply wants the government to return his money.

“I would like to get my money back because the money is affecting my trucking business,” Johnson said. “I could use that money to still purchase a truck.”

Johnson said he still hasn’t been able to purchase another truck for his business since the money was seized.

Gervasi said the court could deliver its opinion in one of two ways — a formal published decision or just a memorandum order. Gervasi said she expects the former would take between 60 to 90 days and the latter 30 to 60 days.

Reach the reporter Perry Vandell at 602-444-2474 or perry.vandell@gannett.com. Follow him on Twitter @PerryVandell.

This article originally appeared on Arizona Republic: Lawyers say man should get back $39K in Phoenix civil forfeiture case