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State v. Adames Deli & Grocery, Inc.

Court of Appeals of Ohio, Ninth District, Lorain

July 15, 2019

STATE OF OHIO Appellant
v.
ADAMES DELI & GROCERY, INC., et al. Appellees

          APPEAL FROM JUDGMENT ENTERED IN THE COURT OF COMMON PLEAS COUNTY OF LORAIN, OHIO CASE No. 12CV177496

          DENNIS P. WILL, Prosecuting Attorney, and RICHARD A. GRONSKY, Assistant Prosecuting Attorney, for Appellant.

          MICHAEL J. CAMERA, Attorney at Law, for Appellees.

          DECISION AND JOURNAL ENTRY

          DONNA J. CARR JUDGE.

         {¶1} Appellant the State of Ohio appeals from the judgment of the Lorain County Court of Common Pleas. This Court affirms in part, reverses in part, and remands the matter for further proceedings consistent with this opinion.

         I.

         {¶2} This Court summarized much of the facts and history of the case in the prior appeal. This matter involves

a forfeiture action wherein the State of Ohio sought the forfeiture of three bank accounts in connection with welfare fraud. By way of background, the police began investigating Adames Deli & Grocery, Inc. (the "Deli") for potential welfare fraud after receiving a tip. The police used a confidential informant to conduct five controlled buys at the Deli. According to the confidential informant's testimony, the store clerk, Rafael Coll, allowed her to pay for ineligible items with an Electronic Benefit Transfer ("EBT") card during each controlled buy. Other witnesses, who were not confidential informants, testified that Mr. Coll also allowed them to pay for ineligible items using their EBT cards, including cell phone minutes, cigarettes, newspapers, prepared food, lighters, and laundry detergent.
A grand jury indicted Mr. Coll on ten counts of illegal use of supplemental nutrition assistance program benefits or WIC program benefits in violation of Revised Code Section 2913.46(B). A grand jury also indicted the Deli, and the trial court consolidated the cases for trial. After a two-day bench trial, the trial court found Mr. Coll guilty of five counts and sentenced him to community control. The trial court found the Deli not guilty on all counts.
Following the conclusion of the criminal trial, the State pursued its forfeiture action, which had been stayed pending the criminal trial. The parties stipulated to the admission of the transcripts and evidence from the criminal cases in the forfeiture case. At the forfeiture hearing, the State argued that three separate bank accounts, one belonging to Mr. Coll, and two belonging to the Deli, contained proceeds of illegal welfare transactions. Mr. Coll's account contained $4, 403.61, while the Deli's accounts contained a total of $8, 107.91. The State argued that records reflected that the Deli's EBT reimbursements far exceeded its reported sales, indicating that the Deli received EBT redemptions for ineligible items. The State also argued that, while it was seeking forfeiture of roughly $12, 500, the Deli received hundreds of thousands of overpayments from the government relative to sales of ineligible items. For example, the State pointed to evidence indicating that, in 2011, the Deli reported $150, 298.27 in food sales for tax purposes, yet received $413, 917.42 in EBT redemptions, which is a redemption rate of approximately 275%. By comparison, three other local stores had redemption rates ranging between 18% and 24% for the same year.
The defense presented two witnesses at the forfeiture hearing: Mr. Coll and Francisco Adames, one of the Deli's owners. Mr. Coll testified that he was the sole employee of the Deli, that he earned $500.00 a week, and that he received his paycheck through direct deposit, which came from one of the Deli's accounts.

State v. Adames Deli & Grocery, Inc., 9th Dist. Lorain No. 17CA011148, 2018-Ohio-442, ¶ 2-5. Mr. Coll additionally testified that his daughter won $5, 000 in the lottery which she gave to him so that he could pay his bills since she lived with him. He averred that he deposited the money into his account that was at issue. Mr. Coll could not remember when his daughter won the lottery and did not provide any documentation to support his claim.

Mr. Adames testified that he made a mistake when filing the Deli's taxes because he overestimated taxable sales and underestimated food sales. He testified that he was inexperienced in this regard, but "did the best [he] could[.]" Other than his testimony, Mr. Adames did not present any evidence that contradicted the State's evidence, or showed that the figures the State used from the Ohio Department of Taxation or the Ohio Department of Job and Family Services (which maintains EBT redemption records) were inaccurate.
The trial court summarily determined that the State met its burden with respect to the items Mr. Coll sold to the confidential informant during the five controlled buys, which totaled $153.31. It, therefore, ordered a partial forfeiture of Mr. Coll's account in the amount of $153.31, plus any accrued interest. The trial court further held that the State "failed to meet its burden for any other issue as it pertains to this claim[, ]" and ordered the release of the remaining two accounts. The State then moved for findings of fact and conclusions of law under Civil Rule 52.
In its conclusions of law, the trial court stated that the burden of proof is a preponderance of the evidence, and held that the State met its burden with respect to the five controlled buys. It provided no analysis as to why the State failed to meet its burden with respect to the other two accounts, or why it only ordered a partial forfeiture of Mr. Coll's account.

Id. at ¶ 5-7.

         {¶3} The State appealed, raising three assignments of error for our review. Id. at ¶ 7. Ultimately, we concluded that we were unable to conduct a meaningful review because, while the trial court indicated the State failed to meet its burden with the respect to the two accounts belonging to the Deli, the trial court provided no analysis in support of that conclusion. Id. at ¶ 10. Thus, this Court determined that the trial court's findings of fact and conclusions of law failed to satisfy Civ.R. 52. Id. Accordingly, we remanded the matter for the trial court to issue findings of fact and conclusions of law that were sufficient to permit appellate review. Id.

         {¶4} Upon remand, the trial court issued additional findings and conclusions. In its conclusions of law, the trial court found as follows:

In reviewing the evidence, [the State] has established, by the preponderance of the evidence that the sum of $153.31 was proceeds derived from or acquired through the commission of an offense. This is the sum of money utilized by the confidential informant in her various undercover purchases from Defendant Deli and its clerk, Defendant Coll. However, [the State] has not established by the preponderance of the evidence that the remaining funds in Defendant Coll's account were proceeds derived from the commission of an offense. This is especially true considering the evidence that this account contained funds commingled with funds from an innocent third party. Furthermore, there was no evidence presented that the accounts belonging to Defendant Deli, which was found not guilty of the underlying criminal actions, contained any funds from the commission of an offense as it was found not guilty of any such offense.

         {¶5} Thus, the trial court again ordered that the State was only entitled to retain the $153.31 from Mr. Coll's account and ordered the remainder of that account and the two accounts of the Deli returned to their owners.

         {¶6} The State has appealed, raising four assignments of error for our review. To facilitate our review, we will address the arguments out of sequence. Neither Mr. Coll nor ...


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