Two years after the FBI raided Michael Lacey and Jim Larkin's homes, a federal judge ruled that the bureau seized truckloads of their personal property in violation of Fourth Amendment standards.
The FBI recently returned scores of personal possessions belonging to veteran newspapermen Michael Lacey and Jim Larkin as the result of a judge’s finding that the bureau violated their Fourth Amendment right against unreasonable search and seizure when its agents raided the men’s homes at gunpoint two years ago.
In a ruling dated May 12 from the U.S. District Court in Phoenix, Judge Susan Brnovich found that certain categories of items listed in the FBI’s 2018 warrant applications were “impermissibly vague under the Fourth Amendment.”
These categories included “evidence of wealth” obtained from “illicit activity” as well as any “property or proceeds” garnered from “money laundering,” such as, “currencies, coins, precious metals, artwork, jewelry, home furnishings and vehicles.”
Brnovich did not toss the warrants in their entirety, but she did agree that the warrants were “not particular enough” to comport with the requirements of Fourth Amendment jurisprudence.
The phrase “evidence of wealth,” she noted, lacked specificity, as Lacey and Larkin had formerly owned Village Voice Media, a chain of 17 alternative newspapers that included the Village Voice in New York City and the LA Weekly in Los Angeles. Lacey and Larkin sold the chain in 2012, though the FBI’s warrant affidavit sought “evidence of wealth” from January 1, 2010 to the date of the search.
“Nothing suggests that Lacey and Larkin’s homes were filled solely with items obtained solely from illegal proceeds or to suggest that Backpage.com was being run out of their homes,” Brnovich writes. “Both individuals were successful and wealthy before 2010.”
And yet, prosecutors have contended that Lacey and Larkin’s affluence was wholly derived from the alleged crimes of conspiracy, money laundering and the facilitation of prostitution through the online listings giant Backpage.com, which the two men sold in 2015.
Despite a string of federal and state court decisions over the years that found Backpage to be operating legally, the federal government arrested and indicted both men on April 6, 2018, based on a perverse legal theory: Lacey and Larkin should be held criminally liable for the illegal acts of third parties that are allegedly connected to adult ads, posted to the site by its users.
On the same day that Lacey and Larkin were arrested, federal gendarmes descended on the two men’s homes, terrifying their family members and taking property belonging to Lacey, Larkin and their relatives.
Afterward, Lacey and Larkin’s attorneys challenged several search and seizure warrants concerning “real property, electronic devices and email accounts” owned by the men. In May, Judge Brnovich granted them a partial victory, suppressing the “evidence of wealth” scooped up by the feds.
“Nothing suggests that Lacey and Larkin’s homes were filled solely with items obtained solely from illegal proceeds or to suggest that Backpage.com was being run out of their homes. Both individuals were successful and wealthy before 2010.” — Judge Susan Brnovich
Following Brnovich’s ruling, it took three months for the FBI to return Lacey and Larkin’s property. Through their attorneys, both men generally agreed not to dispose of any of the property prior to the conclusion of the criminal case.
Brnovich’s order did not apply to the prosecution’s seizure of all of Lacey and Larkin’s assets via civil warrants issued in the U.S. District Court for the Central District of California, a prosecutorial bid to cripple the defense and deny it millions of dollars that could be used to pay the significant legal costs required to battle the U.S. government.
That larger fight over the civil asset seizures continues in California even as the criminal trial is set to begin January 12, 2021 in Phoenix. The Ninth Circuit Court of Appeals recently rejected an appeal of the seizures, ruling solely on procedural grounds.
Barbarians at the Gates
In the case of Larkin, the feds descended on his Paradise Valley home, taking, among other things, jewelry, family heirlooms, collectable coins and two cars.
At the time, Larkin was returning from a trip to Scotland with his son, so he did not witness the FBI raid on his house. Instead, he was arrested on the tarmac at Phoenix’s Sky Harbor International Airport.
“Anyone who’s reading this should know that [FBI] thugs might storm into your house without a knock, or with a knock, bash your door down if they care to and take whatever they want.” — Jim Larkin
Two years later, while discussing the raid with Front Page Confidential, Larkin was galled by the memory.
“They had no right to take our cars,” he says. “They had no right to take any of the jewelry, the heirlooms or any of those things. They just took what they saw, what the agents saw, as, quote, ‘evidence of wealth.'”
He pointed out that federal prosecutors “can violate anyone’s rights they want to,” by taking someone’s property and simultaneously seizing the resources necessary to contest the constitutional violation.
“Anyone who’s reading this should know that [FBI] thugs might storm into your house without a knock, or with a knock, bash your door down if they care to and take whatever they want,” he says.
“They just cowboyed it,” Michael Lacey explains of the Oak Creek mess. “They kicked in the doors. They broke a bunch of shit. They ripped stuff off the wall . . . They went up into the crawl space and cut all the wires. So nothing worked in the house. It was really a destructive piece of work.”
By contrast, Lacey was at home on the day of the raids. He recently had gotten married, and he and his new wife had a wedding party scheduled for the following day, with friends and relatives having flown in from around the country.
The couple had planned a honeymoon trip to Spain, a fact known to the FBI agent who mentioned it in the warrant affidavit as evidence that Lacey engages in “international travel,” which the agent regarded as being indicative of money laundering.
“We were leaving on our honeymoon that Monday,” he tells FPC. “And I spent my honeymoon in Florence, where I said, `Don’t call me honey.'”
Lacey means Florence, Arizona — specifically the federal pen there, where he spent more than a week before prosecutors agreed to his release on a $1 million bond. (Larkin, too, was held for more than a week behind bars before bailing out on a $1 million bond.)
“First time in my life I was ever grateful for being old,” Lacey cracks.
The FBI nabbed Lacey at his Paradise Valley home when he looked up to see an agent pointing a gun through a window, telling Lacey to put his hands in the air and walk slowly toward him.
An FBI agent also barged in on Lacey’s mother-in-law, in town for the party, as she was showering, pointing a gun at the woman, then in her late 70s, and refusing her request for a towel.
What Lacey could see as he was trundled off to Florence did not reassure him.
“The FBI pulled up with vans,” he says. “So I knew it wasn’t going to be good. And they told my wife to get off the fucking property. They gave her one key, the key to her car, and said she had to leave.”
Knowing that a grand jury had been impaneled, both Lacey and Larkin previously offered to surrender themselves if indicted.
The prosecutor’s office declined.
“I think from [the prosecution’s] point of view, it’s, let’s go full bore. And maybe, if at some later date, we have to give them stuff back after they have to spend thousands of dollars to get it, we still win.” — former Arizona State Bar president, Mike Piccarreta
At Lacey’s vacation house in Oak Creek, just north of Sedona, the FBI rammed the property’s south gate, knocking it off its rails. As they did at Lacey’s Paradise Valley home, they removed art and photos from the walls, hauling off anything of value.
They also left behind considerable damage.
“They just cowboyed it,” Lacey explains of the Oak Creek mess. “They kicked in the doors. They broke a bunch of shit. They ripped stuff off the wall . . . They went up into the crawl space and cut all the wires. So nothing worked in the house. It was really a destructive piece of work.”
Like Larkin, Lacey had two vehicles taken from him, a Dodge truck and a 2014 Jaguar. The feds also seized Lacey’s wife’s jewelry, most pre-dating their marriage. She had to retain her own attorney to get it back.
The warrant “return” on Lacey’s Paradise Valley home — a document that lists items seized pursuant to the warrant — reads like the results of a bizarre shopping spree. It includes cash Lacey was planning to take with him to Spain, a brown wool rug, photos of the Grand Canyon, a “statue of Barry Goldwater,” wrist watches, some Mexican pesos, a “photo of a clown on roller skates,” and a “brown clock,” among many similar entries.
Lacey likened the experience to the times he’s had things stolen from him in the past.
“I’ve been broken into a couple of times over the course of my life,” he says. “Mostly, it was when I was broke-ass, and there wasn’t shit to steal, you know? But you still feel violated that someone has gone through all of your things and tossed them.”
Interestingly, the FBI left a calling card of sorts, hidden amongst paperwork on his desk, a fan with the slogan, “Today’s FBI. It’s for you.”
Asked to comment on this development, Mike Piccarreta, a Tucson-based defense attorney and former president of the State Bar of Arizona, accused prosecutors in the case of acting in bad faith.
Piccarreta says government attorneys knew Lacey and Larkin had “substantial, legitimate forms of wealth,” and there had been no adversarial proceeding to demonstrate that any of that wealth was illegal.
He called it a “shoot first, ask questions later attempt” to strip Lacey and Larkin of their assets and make it more difficult for them to defend themselves.
“I never really appreciated the raw, unbridled, mean-spirited power that [federal prosecutors have] and use every day against U.S. citizens.” — Jim Larkin
“I think from [the prosecution’s] point of view, it’s, let’s go full bore,” he explains. “And maybe, if at some later date, we have to give them stuff back after they have to spend thousands of dollars to get it, we still win.”
The prosecution has been “over-zealous, over-aggressive and unfair from day one,” Piccarreta says.
Piccarreta speaks with first-hand knowledge of the situation as he represented one of Lacey and Larkin’s four co-defendants on the case, until the prosecution seized funds set aside for his client’s defense, forcing him to withdraw. Piccarreta was one of two defense attorneys made to drop out of the case for this reason.
Prosecutors also seized millions set aside to pay Lacey and Larkin’s First Amendment attorneys at Davis Wright Tremaine, but prosecutors failed in an attempt to kick them off the case entirely.
Piccarreta believes that the prosecution “came in so ham-handed” in an attempt to intimidate the defendants.
“Lesser souls than Larkin and Lacey would simply give up, and not want to go through this regardless of innocence,” he says. “That’s why the rules are so geared in favor of the government that it takes a very hardy soul to stand up for themselves and their rights . . . 98% of people don’t.”
And what about the idea that prosecutors cannot presume Lacey and Larkin’s property is the fruit of illegality? Couldn’t that same logic apply to the assets seized by federal attorneys in California?
“It should,” he says. “There’s not ever been an adversarial hearing — that this business that ran for numerous years ever did anything that was illegal. That’s the ugly thing about this.”
For Larkin, the entire episode has brought home what he calls the “brutality” of asset seizures.
“It makes you numb,” he remarks. “No one cares about it till it happens to them . . . I never really appreciated the raw, unbridled, mean-spirited power that [federal prosecutors] have and use every day against U.S. citizens.”
Please also read:
Reason Documentary on Lacey/Larkin Case Wins L.A. Press Club Award
Ninth Circuit Panel Dismisses Appeal of Asset Seizures in Lacey/Larkin Case for Lack of Jurisdiction
- Federal Prosecutors Guilty of Widespread Misconduct in White-Collar Exonerations - September 23, 2020
- FBI Violates Fourth Amendment, Returns Some Personal Property to Lacey/Larkin - September 11, 2020
- Reason Documentary on Lacey/Larkin Case Wins L.A. Press Club Award - September 2, 2020