Even after securing a landmark conviction in the case against John Patrick Couch and Xiulu Ruan, prosecutors are having to deal with rafts of paperwork just to manage the millions of dollars in assets seized from the former local pain doctors.
Ever since their business, Physicians Pain Specialists of Alabama was raided in 2015, some of the high-value assets the government seized from Ruan and Couch have drawn as much attention as the criminal charges against them and their co-conspirators.
Notable was Ruan’s fleet of 17 luxury automobiles, which included Lamborghinis, Ferraris, Bentleys, an Aston Martin and more. However, United States District Court Judge Ginny Granade recently greenlighted the sale of those vehicles after acting U.S. Attorney Steve Butler filed a motion suggesting maintaining the high-end cars would be more trouble than it was worth.
“The items in the [federal government’s] possession — the vehicles — are causing the U.S. to incur considerable storage costs and are depreciating,” Butler wrote. “Therefore, there is good cause for the interlocutory sale of the 17 vehicles.”
More specifically, Butler was requesting to convert the vehicles into an equally valuable sum of cash. Though it’s impossible to say what the cars would sell for at a public auction, an assessment of their current Blue Book value shows they would be worth roughly $4 million.
In federal court, all forfeitures are handled by the U.S. Marshals Service — a task that includes the management, upkeep and sale of any asset seized by a federal agency.
Ed Eversman, a public information officer with the Marshals in the Southern District of Alabama, previously told Lagniappe that, generally, the burden of maintaining valuable items — luxury cars, boats, private planes — can be high. That’s because no one benefits if an item is damaged or sees a decrease in its value while in the Marshals’ possession.
According to Eversman, the government will want to sell those items for as much as possible. A defendant could still get them returned following an acquittal or through a separate civil challenge, leaving the government on the hook for any damage or loss in value.
“If we seized a $15,000 Honda Accord, we’ll still have to keep it in good condition, but if it’s a $500,000 Lamborghini, there’s conditions you have to hold that car in,” Eversman said. “It has to be in a covered, climate-controlled facility, it has to be started every now and then, it has to be so far away from other vehicles — we have a whole list of criteria to where, depending on the value of a certain item, we have to take precautions to keep it in good working condition.”
Eversman said items can be seized and placed in the Marshals’ care as soon as someone is charged with a crime, which means they’ve been tasked with maintaining Ruan’s 17 vehicles for the better part of the last two years. However, Eversman declined to discuss any case specifically.
The location of forfeited items isn’t disclosed, but there are only a handful of authorized auction services used by the Marshals. In the Southern District of Alabama, the closest are Weil Wrecker Service Inc. in Birmingham and America’s Auto Auction of Pensacola. Lagniappe reached out to the manager of the Pensacola location, but did not receive a response by press time.
Before the jury that convicted the doctors of 19 federal charges was dismissed, jurors were told they’d possibly have to decide which of the seized items the government could legally retain, though Ruan and Couch ultimately waived their right to present that evidence to the jury.
According to Eversman, a 60-day window exists for anyone who wants to file a claim to property seized through a federal criminal proceeding — a process that has complicated the ongoing forfeiture of Couch and Ruan’s assets due to the number of family members, business associates and banks claiming an interest.
The federal rules of civil procedure permit even property “alleged to be forfeitable” to be sold prior to a final forfeiture order. So, even with the final ownership of those assets unclear, the liquidation of Ruan’s vehicles has firm legal footing. Plus, Butler’s motion claimed their sale could benefit Ruan as much as the U.S.
“Conversion of these items to cash via interlocutory sale will preserve the value of the 17 vehicles for the benefit of the U.S. and defendant Ruan,” he wrote. “The dollar amount of property forfeited shall be applied against [his] forfeiture money judgment.”
Couch also faces the forfeiture of a house in Daphne, two condos in Orange Beach, a 2013 Maserati, two Porsches and 1969 Chevrolet Corvette Stingray — all of which the government requested to liquidate in a separate motion Granade has yet to rule on.
A separate motion seeks to secure one of the seized vehicles — a 2008 Cadillac Escalade — for use by an agency involved in the investigation of Physicians Pain Specialists of Alabama, though Butler’s office didn’t respond to requests seeking to identify which agency that was.
In all, the total assets Ruan and Couch could potentially forfeit are worth tens of millions, though exactly who will benefit from them is still unclear. Eversman said in general, the first to see money from forfeitures are the agencies handling a case, though most are just recouping costs.
“One of the first things that happens is the reimbursement of any cost associated with the seizure, the upkeep of those items and the trial. All those expenses get paid first before any money gets dispersed, and that disbursement is based on percentages,” he added. “If the [Drug Enforcement Administration] makes a drug case on somebody and $10 million is seized, that doesn’t go straight into the DEA coffers, it goes back to the federal government as a whole.”
Eversman said the same is true for local agencies that process civil forfeitures through the Department of Justice’s Equitable Sharing Program, which the Marshals also oversee. As Lagniappe reported last month, local agencies have processed millions of dollars through that program.
No matter how they’re seized, all items sold through the Marshals can be reviewed at usmarshals.gov/assets, though it doesn’t appear any of the items taken from Ruan and Couch have been listed yet.