U.S. Supreme Court Upholds Ruling Of Chattanooga Judge In Brainerd Army Store Case

  • Monday, June 5, 2017

The U.S. Supreme Court has upheld a ruling of Chattanooga Federal Judge Sandy Mattice in the Brainerd Army Store case.

Brothers Tony and Terry Honeycutt were arrested for sales of large amounts of a meth ingredient. Tony Honeycutt pleaded guilty, and Terry Honeycutt was convicted at trial.

Judge Mattice had ruled that Terry Honeycutt was not subject to a forfeiture because he was a salaried employee and not an owner of the store.

The government appealed and the U.S. Sixth Circuit put the forfeiture in effect.

However, the Supreme Court in an 8-0 ruling sided with Judge Mattice.

The ruling said, "Terry Honeycutt managed sales and inventory for a Tennessee hardware store owned by his brother, Tony Honeycutt. After they were indicted for federal drug crimes including conspiracy to distribute a product used in methamphetamine production, the Government sought judgments against each brother in the amount of $269,751.98 pursuant to the Comprehensive Forfeiture Act of 1984, which mandates forfeiture of “any property constituting, or derived from, any proceeds the person obtained, directly or indirectly, as the result of” certain drug crimes, 21 U. S. C. §853(a)(1). Tony pleaded guilty and agreed to forfeit $200,000. Terry went to trial and was convicted. Despite conceding that Terry had no controlling interest in the store and did not stand to benefit personally from the sales of the product, the Government asked the District Court to hold him jointly and severally liable for the profits from the illegal sales and sought a judgment of $69,751.98, the outstanding conspiracy profits. The District Court declined to enter a forfeiture judgment against Terry, reasoning that he was a salaried employee who had not received any profits from the sales. The Sixth Circuit reversed, holding that the brothers, as co-conspirators, were jointly and severally liable for any conspiracy proceeds. Held: Because forfeiture pursuant to §853(a)(1) is limited to property the defendant himself actually acquired as the result of the crime, that provision does not permit forfeiture with regard to Terry Honeycutt, who had no ownership interest in his brother’s store and did not personally benefit from the illegal sales." 

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