Judge Upholds Seizure of Assets of 2 Allegedly Selling Drug Ingredients

A federal judge in Los Angeles has upheld the seizure by federal drug agents of more than $785,000 in assets from a Westlake Village couple who prosecutors allege sold large amounts of chemicals used in the illegal manufacture of PCP and other drugs.

U.S. District Judge Terry J. Hatter Jr. ruled Monday that prosecutors had acted properly in confiscating the home and other assets of Burton and Joyce Farrell, including property held by a company they own, Chemical Shed in San Bernardino.

Asst. U.S. Atty. James Stotter II said Tuesday that the seizure is part of the first application in Southern California of a year-old federal law that allows prosecutors to use civil procedures to shut businesses “used to facilitate illicit drug activity.”

Couple Not Charged

The Farrells have not been arrested or charged with any crime, Stotter said. But wiretaps used in a yearlong investigation found that Chemical Shed was supplying “clandestine drug laboratories” from its wholesale chemical outlets in Canoga Park, Ventura and San Bernardino, he said.

Stotter said chemicals sold by the Farrells were legal but that the investigation showed that Burton Farrell knew the supplies were being used illegally. He said the company sold chemicals used to make phencyclidine, or PCP, a hallucinogenic drug that often produces bizarre behavior; amphetamines and methaqualone, usually referred to as Quaaludes.

First Use of Crime Act

“This company, we claim, was selling to people who were illegally manufacturing drugs and then selling them,” Stotter said. “It was the first time in Southern California we have put into practice the Omnibus Crime Control Act of 1984 to seize all the assets and profits of an illegal enterprise.”

The act permits federal law-enforcement authorities to seize assets they believe have been obtained through a variety of illegal activities, primarily sale of drugs, but including counterfeiting, sales of illegal handguns and customs violations.

Acting under the new law, federal prosecutors in July filed 12 civil suits seeking seizure of the Farrells’ assets. Federal Drug Enforcement Agency agents then seized more than $1 million in assets, including “truckloads of chemicals,” Stotter said.

On Monday, Hatter rejected motions by the Farrells’ attorneys to dismiss the 12 suits.

Monday’s hearing was the first of several at which Hatter will rule on the priority of the seizure, Stotter said. At issue Monday was more than $785,000 worth of confiscated property; there is about $500,000 more, including the seized chemicals, whose forfeiture prosecutors will request from Hatter, Stotter said.

Eugene West, an attorney for the Farrells, said he argued before Hatter that the powers granted to prosecutors by the 1984 crime law are unconstitutional. “The government was able to seize property without any evidence” that the chemicals were sold for illegal purposes, he said. West said he will appeal Hatter’s ruling to the 9th Circuit Court of Appeals.

Stotter said federal authorities have used the civil actions against drug-related businesses because they have found such cases easier to win than criminal prosecutions.

“If you were growing marijuana in your backyard, it wasn’t clear that we could seize the backyard, and Congress made it very clear that we can,” Stotter said.

The property, the forfeiture of which Hatter upheld, includes the couple’s Westlake Village home, which Stotter estimates is worth $650,000, a stock and bond account worth more than $135,000 and property at the Chemical Shed outlet in San Bernardino.

Stotter said federal drug agents are investigating several clandestine laboratories in Los Angeles allegedly supplied by Chemical Shed.