United States' Notice of Motion and Motion to Dismiss First Amended Petition (Case 5:24-cr-00292-PCP)
Summary
The United States files a notice of motion and motion to dismiss with prejudice the first amended petition of third party Sandra Will to real property in Los Gatos, in the case against Cassie Will-Darnall. The hearing is noticed for March 18, 2026, at 10:00 a.m. before the Honorable P. Casey Pitts. Its table of contents argues that a resulting-trust theory is a new ground asserted outside the statutory deadline, that Will has not alleged an intended beneficial interest, and that she lacks standing for a constitutional challenge. The conclusion asks for a final order of forfeiture including up to $746,372.98 in equity from the sale of the Belwood Property, a money judgment of $1,406,594.56, and funds up to $625,952.60 in a Vanguard account. The signature block shows /s/ above Galen A. Phillips.
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“United States' Notice of Motion and Motion to Dismiss First Amended Petition (Case 5:24-cr-00292-PCP).”
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Case 5:24-cr-00292-PCP Document 115 Filed 12/19/25 Page 1 of 16
1 CRAIG H. MISSAKIAN (CABN 125202)
United States Attorney
2
MARTHA BOERSCH (CABN 126569)
3 Chief, Criminal Division
4 GALEN A. PHILLIPS (CABN 307644)
Assistant United States Attorney
5
450 Golden Gate Avenue, Box 36055
6 San Francisco, California 94102-3495
Telephone: (415) 436-7110
7 Email: Galen.Phillips@usdoj.gov
8 Attorneys for United States of America
9 UNITED STATES DISTRICT COURT
10 NORTHERN DISTRICT OF CALIFORNIA
11 SAN JOSE DIVISION
12 UNITED STATES OF AMERICA, ) CASE NO. CR-24-00292-PCP
)
13 Plaintiff, ) UNITED STATES’ NOTICE OF MOTION AND
) MOTION TO DISMISS FIRST AMENDED
14 v. ) PETITION
)
15 CASSIE WILL-DARNALL, ) Date: March 18, 2026
) Time: 10:00 a.m.
16 Defendant. ) Courtroom: Courtroom 8, 4th Floor
) Judge: Honorable P. Casey Pitts
17 SANDRA WILL, )
)
18 Third Party Petitioner. )
)
19 TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:
20 PLEASE TAKE NOTICE that, on March 18, 2026, at 10:00 a.m., or as soon thereafter as the
21 parties may be heard, in Courtroom 8 of the Robert F. Peckham Federal Building and United States
22 Courthouse, the United States of America will and hereby does move for a dismissal with prejudice of
23 the petition to the real property located at 111 Belwood Gateway, Los Gatos, CA 95032, APN 527-31-
24 019, asserted in the first amended petition filed by third party Sandra Will.
25 This motion is based on Federal Rule of Criminal Procedure Rule 32.2, the accompanying
26 Memorandum of Points and Authorities, the supporting declarations, the pleadings and documents on
27 file in this action, and any argument and evidence the Court may permit at the hearing or permitted at
28 any prior proceeding.
U.S.’ MTD 1
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1 TABLE OF CONTENTS
2 INTRODUCTION .......................................................................................................................................1
3 I. Factual and Procedural Background ................................................................................................2
4 II. Legal Standard .................................................................................................................................3
5 III. Argument .........................................................................................................................................6
6 A. Because Will’s Resulting-Trust Theory Is A New Ground For Relief Asserted
Outside The Statutory Deadline, It Should Be Denied On Its Face.....................................6
7
B. Because Will Has Not Alleged Will-Darnall Took Title To The Belwood
8 Property While Will Was Intended To Hold The Beneficial Interest Of The
Property, Will’s Claim Is Defective As A Matter Of Law. .................................................8
9
C. Because Will Lacks A Cognizable Legal Interest In The Belwood Property,
10 She Lacks Standing To Assert A Constitutional Violation Concerning Its
Forfeiture, Which Is Proportional To Will-Darnall’s Crimes In Any Event. ....................12
11
CONCLUSION ..........................................................................................................................................12
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Case 5:24-cr-00292-PCP Document 115 Filed 12/19/25 Page 3 of 16
1 TABLE OF AUTHORITIES
2 Cases
3 Altramano v. Swan, 20 Cal. 2d 622 (1942) ................................................................................................. 8
4 Hong Jun Xun v. Colvin, No. C-13-2041-YGR, 2014 WL 1477532 (N.D. Cal. Apr. 15, 2014)................ 8
5 In re Schechtman’s Est., 162 Cal. App. 2d 365 (1958) ........................................................................ 8, 10
6 Johnson v. Johnson, 192 Cal. App. 3d 551 (Ct. App. 1987) ................................................................ 9, 10
7 Lloyds Bank California v. Wells Fargo Bank, 187 Cal. App. 3d 1038 (Ct. App. 1986) .................. 8, 9, 10
8 Majewsky v. Empire Constr. Co., 2 Cal. 3d 478 (1970) ....................................................................... 8, 10
9 Quinn v. Reilly, 198 Cal. 465 (1926) .......................................................................................................... 8
10 Sprewell v. Golden State Warriors, 266 F.3d 979 (9th Cir) ..................................................................... 10
11 United States v. Alamoudi, 452 F.3d 310 (4th Cir. 2006)........................................................................... 5
12 United States v. Alvarez, 710 F.3d 565 (5th Cir. 2013) .............................................................................. 7
13 United States v. Caspersen, 275 F. Supp. 3d 502 (S.D.N.Y. 2017) ........................................................... 4
14 United States v. Crew, 704 F. App’x. 30 (2d Cir. 2017) ............................................................................ 7
15 United States v. Garza, 407 F. App’x. 322 (10th Cir. 2011) ...................................................................... 5
16 United States v. Gordon, 710 F.3d 1124 (10th Cir. 2013) .......................................................................... 5
17 United States v. Grossman, 501 F.3d 846 (7th Cir. 2007) .......................................................................... 7
18 United States v. Gutierrez, 734 F. App’x. 441 (9th Cir. 2018)................................................................. 11
19 United States v. Holy Land Foundation for Relief and Development, 722 F.3d 677 (5th Cir. 2013) ........ 3
20 United States v. Klemme, 894 F. Supp. 2d 1113 (E.D. Wis. 2012) ............................................................ 7
21 United States v. Knowles, 819 F. App’x. 781 (11th Cir. 2020) .................................................................. 5
22 United States v. Kramer, 25 F.4th 509 (7th Cir. 2022)............................................................................... 5
23 United States v. Lamid, 663 F. App’x 319 (5th Cir. 2016) ......................................................................... 7
24 United States v. Lebnitz Tran, 21-CR-269-WHO (N.D. Cal.)…………………………………………….8
25 United States v. Marion, 562 F.3d 1330 (11th Cir. 2009) .......................................................................... 8
26 United States v. Miller, 911 F.3d 229 (4th Cir. 2018) ................................................................................ 4
27 United States v. Nejad, 933 F.3d 1162 (9th Cir. 2019)............................................................................... 5
28 United States v. Osborn, 357 F. App’x. 109 (9th Cir.) ............................................................................... 7
U.S.’ MTD ii
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1 United States v. Pole No. 3172, Hopkinton, 852 F.2d 636 (1st Cir. 1988) ................................................. 4
2 United States v. Soreide, 461 F.3d 1351 (11th Cir. 2006) .......................................................................... 6
3 United States v. Totaro, 345 F.3d 989 (8th Cir. 2003) ............................................................................... 4
4 United States v. Welch, No. 23-3309, 2024 WL 4879474 (9th Cir. Nov. 25, 2024) .................................. 6
5 Statutes
6 18 U.S.C. § 981 ....................................................................................................................................... 3, 4
7 18 U.S.C. § 1344(2) .................................................................................................................................... 3
8 21 U.S.C. § 853 ............................................................................................................................... 5, 6, 7, 8
9 28 U.S.C. § 2461 ......................................................................................................................................... 3
10 Cal. Evid. Code § 662 ................................................................................................................................. 8
11 Rules
12 Fed. R. Crim. P. 32.2 .............................................................................................................................. 5, 7
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1 INTRODUCTION
2 On June 4, 2020, Cassie Will-Darnall fraudulently obtained $968,989, potentially the largest sum
3 of money she had ever received (until, at least, she received $1,864,565 a few weeks later). Within
4 eleven days, Will-Darnall poured most of that money into the Belwood Property. 1 She poured the
5 money into Belwood by paying off a loan from Sandra Will secured by the 2019 Deed of Trust. Five
6 days later, Will-Darnall transferred to Will title to the Belwood Property, despite having just repaid
7 Will’s loan.
8 There is a simple explanation for this conduct consistent with the pleadings and evidence before
9 this Court: Will-Darnall was trying to shield fraud proceeds from recovery. That effort to shield fraud
10 proceeds from recovery continues in Will’s amended claim, in which she asserts her fourth theory of
11 relief. Her initial claim was predicated on the 2019 Deed of Trust. Now, however, Will claims that
12 before securing a loan to Will-Darnall with the Belwood Property, Will already owned the property. On
13 the uncontroverted record before this Court, this new claim can only be described as absurd.
14 It would be absurd for a bank to secure loans with the bank’s own brick-and-mortar stores. It
15 would be absurd for a car dealership to secure car loans to buyers with the dealership’s inventory. And it
16 would be absurd for a mother to secure a loan to her daughter with the mother’s own property. Simply
17 put, a security interest only works if the secured property is the borrower’s, not the lender’s. But—
18 despite a documented sophistication in real estate and asset protection learned from a felon—Will now
19 demands, subject to penalty of perjury, this Court accept the absurd as true.
20 Whatever its factual merit, Will’s latest theory should be denied with prejudice because it fails as
21 a matter of law for at least the following two reasons:
22 First, because the time limit applicable to third-party claims in forfeiture proceedings is strictly
23 observed, Will should not be permitted to assert a new theory of relief now 196 days after the expiration
24 of that time limit. While the ancillary proceeding borrows from the Federal Rules Civil of Procedure, it
25 does not reflect the same permissive approach to amendment, given the express timing of the statute.
26
27
1
28 As in prior filings concerning forfeiture, defined terms retain the definitions provided in earlier
pleadings, and citations to ECF-file documents refer to the ECF-generated pagination.
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1 Second, Will has not pled facts sufficient to support her new theory because she has not
2 alleged—as she must—circumstances showing that she and Will-Darnall intended Will-Darnall to hold
3 the legal interest to the Belwood Property, while Will held the beneficial interest to the property.
4 Without such allegations, Will’s claim to a resulting trust—an equitable remedy rarely applied,
5 particularly in cases, such as this one, involving familial relations—fails as a matter of law.
6 I. Factual and Procedural Background
7 The government incorporates the factual and procedural background provided in prior pleadings.
8 Dkts. 43, 77.
9 At the initial hearing on Will’s claim, her counsel indicated that he had received additional
10 evidence from his client supporting Will’s interest in the Belwood Property. Will’s counsel indicated he
11 did not want to sandbag the government before that hearing and so had not provided any of the materials
12 to the government. That evidence has still not been provided to the government and does not appear to
13 form the basis of Will’s amended claim.
14 Will’s counsel also claimed that in preparing for the hearing he determined a better way to
15 characterize Will’s claim and would appreciate the opportunity to amend. Will’s counsel, however,
16 never mentioned a resulting-trust theory. Will’s counsel acknowledged that, as a third party, Will did not
17 have any right to contest forfeitability. But Will’s counsel asserted that the government had cited no law
18 or precedent supporting its approach to forfeiture in this case.
19 The government objected to Will’s eleventh-hour request to amend. And the government
20 expressed skepticism that a person could own a property in California without holding title.
21 On October 21, 2025, the Court dismissed Will’s claim with leave to amend. Dkt. 103. On
22 November 11, 2025, Will filed her amended claim. Dkt. 104. In support of her amended claim, Will
23 relies on all the same evidence as in her original claim. Compare Dkt. 65, with Dkt. 104. Included in that
24 evidence are the following:
25 1. A petition for dissolution of a marriage and domestic partnership dated September 15, 2016,
26 signed by Cassie Will-Darnall, in which the Belwood Property is characterized as Will-
27 Darnall’s separate property (Dkt. 104-5, at 5);
28
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1 2. A stipulated judgment for dissolution of marriage dated April 3, 2017, signed by Cassie Will-
2 Darnall, in which the Belwood Property is “awarded” to Will-Darnall and in which Will-
3 Darnall’s ex-spouse is described as having “received a buy-out from Cassie [Will-Darnall] as
4 to her interest” in the Belwood Property (Dkt. 104-6 at 5–6); and
5 3. Checks from Will-Darnall to Will for the “Belwood Mortgage” (e.g., Dkt. 104-7 at 5).
6 At a hearing on Will-Darnall’s restitution and forfeiture obligations, the Court reiterated Will’s
7 assertion that forfeiture of the Belwood Property is unsupported by law. See Dkt. 109. And Will-
8 Darnall’s counsel characterized the Belwood Property as the home of Will-Darnall, not Will.
9 II. Legal Standard
10 The government supplements the record to further establish the legal basis for forfeiture of the
11 Belwood Property, while reserving all rights to object to a third party’s ability to challenge the
12 forfeitability of property in the ancillary proceeding. E.g., United States v. Holy Land Foundation for
13 Relief and Development, 722 F.3d 677, 689–90 (5th Cir. 2013) (quoting the advisory committee notes to
14 Federal Rule of Criminal Procedure 32.2).
15 As detailed in the government’s motion to dismiss or for summary judgment (Dkt. 77), the
16 government intends to forfeit from the Belwood Property both the “amount of the proceeds traced into
17 th[e] property—$746,372.98—and the . . . amount of the money judgment . . . $1,406,594.56.” Id. at 7.
18 This two-step approach is supported by the law and precedent.
19 First, Will-Darnall put $746,372.98 of fraud proceeds into the Belwood Property. Those funds
20 were derived from Will-Darnall’s first count of conviction, bank fraud (18 U.S.C. § 1344(2)). This fact
21 is uncontested and dispositive of the government’s ability to recover $746,372.98 in equity from the sale
22 of the home (assuming the Belwood Property has that much in equity, which is unclear given the
23 number, and alleged value, of encumbrances on the property).
24 18 U.S.C. § 981(a)(1)(C) provides for the forfeiture of any real property derived from proceeds
25 traceable to a violation of 18 U.S.C. § 1344(2). While section 981 applies to civil proceedings, Congress
26 extended its application to criminal proceedings in 28 U.S.C. § 2461(c).
27
28
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1 At the hearing on the motion to dismiss, Will’s counsel claimed the government had cited no
2 authority for forfeiting real property when fraud proceeds were used to make mortgage payments on the
3 property, not buying it outright. Not so. See Dkt. 77, n.12.
4 Having been advised of this inaccuracy after the hearing, Will’s counsel now admits in a
5 footnote that precedent supports forfeiture of equity in a home acquired with fraud proceeds. Dkt. 104,
6 at 13 n.4. As the government previously wrote, a contrary result would yield the bizarre outcome where
7 “ a defendant could acquire a home with a no-down-payment [or zero-percent-down] loan and then
8 shield their crime proceeds from forfeiture simply by making their mortgage payments. Dkt. 77, at 21
9 n.12; see also United States v. Caspersen, 275 F. Supp. 3d 502, 504 (S.D.N.Y. 2017) (“[A] defendant
10 may not convert crime proceeds into ‘clean’ funds simply by taking out a HELOC and repaying it using
11 crime proceeds.”).
12 Such a result is contrary to precedent because real property acquired with fraud proceeds
13 (including through an all-cash purchase or mortgage payments) is plainly forfeitable under 18 U.S.C.
14 § 981. See, e.g., United States v. Miller, 911 F.3d 229, 235 (4th Cir. 2018) (“Miller’s further argument
15 that expenditures on mortgage interest payments are not traceable to equity in the property is not
16 supported by authority. Payments on the mortgage directly increased Miller’s equity in the Virginia
17 property whether they went towards interest or principal on the note. The fraud proceeds were therefore
18 ‘traceable to’ Miller’s equity interest as required by § 981.”); United States v. Pole No. 3172, Hopkinton,
19 852 F.2d 636, 640 (1st Cir. 1988); Caspersen, 275 F. Supp. 3d at 504 (“When a mortgage for real
20 property is paid using crime proceeds, the Government acquires an interest in that property.”); see also
21 United States v. Totaro, 345 F.3d 989, 998 (8th Cir. 2003) (holding defendant’s wife may only recover
22 what interest she had in the marital property as a matter of state law before defendant committed the
23 offense and began using criminal proceeds to pay off the mortgage and make improvements).
24 Given the plain language of § 981 and precedent, Will pivots and argues now that the
25 government is not entitled to forfeit any excess equity beyond the proceeds traced into the property. Dkt.
26 77, n.12. But this argument, too, is contrary to the law and precedent.
27 Once the Court enters a final order of forfeiture including the money judgment of $1,406,594.56,
28 the government will apply to the Court for the forfeiture of substitute assets—namely, any equity in
U.S.’ MTD 4
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1 excess of $746,372.98, but not to exceed $1,406,594.56 (that is, $2,152,967.54 in total), resulting from
2 the sale of the Belwood Property—to satisfy the money judgment. See Fed. R. Crim. P. 32.3(e); 21
3 U.S.C. § 853(p).
4 Section 853(p) allows the government to satisfy a money judgment with substitute property
5 (including equity from the sale of a house) when the Court determines property subject to forfeiture,
6 including fraud proceeds:
7 1. Cannot be located upon the exercise of due diligence;
8 2. Has been transferred or sold to, or deposited with, a third party;
9 3. Has been placed beyond the jurisdiction of the court;
10 4. Has been substantially diminished in value; or
11 5. Has been commingled with other property which cannot be divided without difficulty.
12 21 U.S.C. § 853(p). In short, substitute property may be used to satisfy a money judgment when, as here,
13 the defendant has dissipated the fraud proceeds. Cf. United States v. Gordon, 710 F.3d 1124, 1166 (10th
14 Cir. 2013) (“The Government generally has little difficulty in making the necessary showing [under §
15 853(p) ].”) (citations omitted) (collecting cases).
16 If the Court determines the elements of section 853(p) are met, as the government expects it will,
17 then forfeiture of any excess equity from the sale of the Belwood Property—up to $1,406,594.56—as a
18 substitute asset is mandatory. E.g., United States v. Alamoudi, 452 F.3d 310, 314 (4th Cir. 2006)
19 (“Section 853(p) is not discretionary; rather, the statute mandates forfeiture of substitute assets ‘when
20 the tainted property has been placed beyond the reach of a forfeiture.’” (emphasis added)); United States
21 v. Knowles, 819 F. App’x. 781, 783 (11th Cir. 2020) (“Rule 32.2(e) further provides that, if the
22 government shows that the defendant’s property is subject to forfeiture as substitute property, the court
23 must enter an order forfeiting that property.” (emphasis added)); United States v. Garza, 407 F. App’x.
24 322, 325 (10th Cir. 2011) (“Because the requirements for the forfeiture of substitute property in § 853(p)
25 were satisfied, the district court was required to amend its order of forfeiture to include the identified
26 real property as substitute property in partial satisfaction of the criminal forfeiture money judgment.”
27 (emphasis added)); see also United States v. Kramer, 25 F.4th 509, 512 n.6 (7th Cir. 2022) (“Property
28 that could have been forfeited as direct proceeds of criminal activity may nevertheless be forfeited later
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1 as substitute assets.”); cf. United States v. Nejad, 933 F.3d 1162, 1165 (9th Cir. 2019) (“Section 853(p)
2 does not limit the substitute property eligible for forfeiture to property that the defendant owns at the
3 time of sentencing. We have accordingly held that a court may order forfeiture in the form of a personal
4 money judgment against the defendant, and that the government may attempt to satisfy the judgment
5 with any substitute property it locates in the future.” (citations omitted)).
6 Against this backdrop, the government’s approach to forfeiture cannot credibly be described as
7 “novel” as Will’s counsel persists in claiming. Compare Dkt. 104, at 13, with, e.g, United States v.
8 Susan Xiao-Ping Su, 11-CR-288-JST (N.D. Cal.), Dkt. 228 (amended final order of forfeiture including
9 five real properties); United States v. Esther Sanchez, 15-CR-475-BLF (N.D. Cal.), Dkt. 183 (final order
10 of forfeiture contemplating applying real-property-sale proceeds to money judgment); United States v.
11 Pavel Lazarenko, 00-CR-284-CRB (N.D. Cal.), Dkt. 1626 (final order of forfeiture forfeiting real
12 property acquired with laundered money); United States v. Jonathan Chang, 16-CR-47-EJD (N.D. Cal.),
13 Dkts. 288 (approving forfeiture of interest in five real properties and application of sale proceeds to
14 money judgment), 296 (staying forfeiture pending outcome of appeal); see also, e.g., United States v.
15 Allen Fong, 14-CR-527-VC (N.D. Cal.), Dkt. 572 (stipulated order of forfeiture contemplating sale of
16 real property to satisfy $1.7 million money judgment).
17 III. Argument
18 A. Because Will’s Resulting-Trust Theory Is A New Ground For Relief Asserted
Outside The Statutory Deadline, It Should Be Denied On Its Face.
19
20 Third parties must file a petition within thirty days of the final publication of notice or the
21 petitioner’s receipt of notice, whichever is earlier. 21 U.S.C. § 853(n)(2). When applying § 853(n)(2),
22 courts have denied leave to amend based on new grounds for recovery given the interest in a prompt
23 resolution of criminal forfeiture proceedings and the express timing contemplated by the statute. See,
24 e.g., United States v. Welch, No. 23-3309, 2024 WL 4879474, at *1 (9th Cir. Nov. 25, 2024) (affirming
25 district court’s denial of leave to amend when claimant “failed to explain why he was previously unable
26 to discover the information set forth in his motion to amend, and the district court properly characterized
27 the facts described in that motion as new grounds for relief”); United States v. Soreide, 461 F.3d 1351,
28 1355 (11th Cir. 2006) (“[T]o the extent that . . . claims to the properties rest on her contention that she
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1 held interests in those properties that were superior to the interests of Arne Soreide at the time of the acts
2 giving rise to forfeiture, those claims are belated.”); United States v. Lamid, 663 F. App’x 319, 324–25
3 (5th Cir. 2016) (affirming district court’s denial of claimant’s request to amend a claim to correct a
4 defect under § 853(n)(3) because the 30-day deadline is mandatory, and the amended claim would have
5 been filed outside of the 30-day period); United States v. Klemme, 894 F. Supp. 2d 1113, 1116–17 (E.D.
6 Wis. 2012) (holding claimant could not file supplemental pleading after the 30-day deadline expired
7 adding new grounds for recovery).
8 Allowing Will to amend and add a new basis for relief would nullify the 30-day deadline in 21
9 U.S.C. § 853(n)(2). It would incentivize dilatory tactics instead of requiring a claimant to initially state
10 their basis for relief.
11 Here, Will has morphed her claim arguably four times to prevent the government from
12 recovering. First, Will predicated her claim on the 2019 Deed of Trust. See Petition at 16 (“It is the 2019
13 recording of the deed of trust that gave Ms. Will an interest in the home superior to Ms. Will-Darnall . . .
14 .”). Second, Will predicated her claim on unsecured loans made to Will-Darnall before the 2019 Deed of
15 Trust. See Dkt. 83 at 11; see also Dkt. 91 3–4 (collecting cases holding an unsecured creditor lacks
16 standing to assert a claim in the ancillary proceeding). Third, at the hearing, Will’s counsel indicated he
17 had received new evidence substantiating Will’s ownership interest in the Belwood Property, though he
18 never mentioned a resulting trust theory, nor has he provided any new evidence to the government.
19 Fourth, Will now alleges a resulting trust theory.
20 Because Will’s claim predicated on a resulting trust is a new ground for relief asserted outside
21 the statutory deadline, it should be denied without consideration of its merit. Cf., e.g., United States v.
22 Osborn, 357 F. App’x. 109, 109 (9th Cir.) (“The district court correctly found that [the] petition was
23 time-barred because it was filed 71 days after receiving notice of the preliminary order of forfeiture.”
24 (citing 21 U.S.C. § 853(n)(2); Fed. R. Crim. P. 32.2(c)(2).)); United States v. Grossman, 501 F.3d 846,
25 849–50 (7th Cir. 2007) (affirming dismissal of claim filed by lienholder 5 months after it received notice
26 of the order of forfeiture); United States v. Crew, 704 F. App’x. 30, 32 (2d Cir. 2017) (affirming
27 dismissal of claim where petitioner failed to file “within 30 days ‘of the final publication of notice or his
28 receipt of notice’”); United States v. Alvarez, 710 F.3d 565, 567–68 ns.10, 11 (5th Cir. 2013) (declining
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1 to establish a more flexible rule for minor claimant and affirming dismissal of claim filed by minor’s
2 guardian on 74th day after receiving direct notice); United States v. Marion, 562 F.3d 1330, 1341 (11th
3 Cir. 2009) (“It is also undisputed that [petitioner] filed her petition . . . well over three months after
4 receiving her notice. Accordingly, [petitioner’s] petition was untimely. The district court therefore erred
5 in denying the government’s motion to dismiss on grounds that [petitioner] filed her petition within
6 thirty days that criminal judgment was entered against [the defendant].” (emphasis added)); accord
7 United States v. Lebnitz Tran, 21-CR-269-WHO (N.D. Cal.), Dkt. 80 at 2 (“The deadline set in the
8 statute [21 U.S.C. § 853] is firm; I am not aware of a case that has not enforced it.”).
9 B. Because Will Has Not Alleged Will-Darnall Took Title To The Belwood Property
While Will Was Intended To Hold The Beneficial Interest Of The Property, Will’s
10 Claim Is Defective As A Matter Of Law.
11 Under California law, there is a “strong presumption that the holder of the legal title owns the
12 full beneficial interest in the property.” In re Schechtman’s Est., 162 Cal. App. 2d 365, 369 (1958); see
13 also Cal. Evid. Code § 662 (“The owner of the legal title to property is presumed to be the owner of the
14 full beneficial title. This presumption may be rebutted only by clear and convincing proof.”).
15 “A resulting trust arises by operation of law from a transfer of property under circumstances
16 showing that the transferee was not intended to take the beneficial interest.” Lloyds Bank California v.
17 Wells Fargo Bank, 187 Cal. App. 3d 1038, 1042 (Ct. App. 1986) (citations omitted) (emphasis added).
18 A “resulting trust is not founded on the simple fact that money or property of one has been used by
19 another to purchase property.” Majewsky v. Empire Constr. Co., 2 Cal. 3d 478, 485 (1970).
20 To allege a resulting trust, “one must allege either that [they] intended to create a trust or that
21 [they] intended that the [grantee or titleholder] should not have the beneficial interest in the property.”
22 Altramano v. Swan, 20 Cal. 2d 622, 628 (1942); Hong Jun Xun v. Colvin, No. C-13-2041-YGR, 2014
23 WL 1477532, at *10 (N.D. Cal. Apr. 15, 2014) (“In determining whether a resulting trust is created
24 under California law, the ultimate issue is whether the circumstances show that the parties to a transfer
25 of interest in property did not intend for the recipient to hold the beneficial interest despite holding the
26 legal interest, that is, title.”), aff’d, 651 F. App’x 658 (9th Cir. 2016). And “[n]o implication of a trust
27 arises from a parent’s purchase of property in the name of [their] child. Such a purchase is
28 presumptively a gift or an advancement. In re Schechtman’s Est., 162 Cal. App. 2d at 369; Quinn v.
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1 Reilly, 198 Cal. 465, 468 (1926) (“In short, the existence of the relationship of parent and child is a
2 circumstance which prima facie establishes the presumption of an advancement and thereby rebuts the
3 presumption of a resulting trust.” (emphasis added)).
4 In Lloyds Bank California v. Wells Fargo Bank, the California Court of Appeal affirmed the trial
5 court’s determination that a brother (Herbert) did not hold title to a residence as the trustee of a resulting
6 trust in favor of other family members. 187 Cal. App. 3d at 1046. There, a mother and father purchased
7 a San Francisco residence in part with funds provided by several of their children. Id. at 1041. Following
8 the father’s death, the mother conveyed the residence in 1944 to two of her sons as joint tenants, Herbert
9 and Lesly. Id. at 1041. In 1960, Lesly conveyed his interest in the residence to Herbert. Id. at 1042. After
10 then, Herbert paid all real property taxes, fire insurance premiums, painting, plumbing, and house
11 remodeling expenses. Id. At his death, Herbert’s will left a life estate in the residence to his three
12 remaining siblings and directed that upon the death of the last sibling, the residence should go to
13 Herbert’s wife. Id.
14 The trial court held that Herbert had not held the property as trustee for other family members
15 under a resulting trust as asserted by the estates of two of his siblings. Id. at 1040–41, 43. In affirming
16 the lower court’s judgment, the Court of Appeal reasoned that the evidence established the mother gave
17 the residence to Herbert and Lesly “as joint tenants unconditionally, and without any trust restrictions
18 for the benefit of other family members.” Id. at 1043. Nor was there any evidence that in transferring
19 ownership of the residence to Herbert in 1960, Lesly intended to make Herbert a trustee either for Lesly
20 or for the other children. Id. at 1043–44. For instance, Lesly did not assert orally or in writing that he
21 intended to convey his interest in the property to Herbert conditionally or in trust. Id. at 1044. Nor did
22 Lesly ever take any interest in the property during the 14 years between his conveyance of the property
23 to Herbert and Lesly’s death. Id. And, in the more than 20 years between that conveyance and Herbert’s
24 death, various house-related payments were made by Herbert. Id.
25 In contrast, in Johnson v. Johnson, 192 Cal. App. 3d 551 (Ct. App. 1987), the California Court of
26 Appeal affirmed the trial court’s determination that ownership of a Los Angeles home was subject to a
27 resulting trust. Id. at 553. In 1977, a son convinced his parents to buy a home in his name so they could
28 benefit from GI-loan financing only the son could obtain. Id. at 554. The parties (as in, the parents and
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1 their son) understood at the time of the purchase that the parents would be the actual and beneficial
2 owners of the property. Id. Indeed, the parents, not the son, moved into the home the same year. Id.
3 Similarly, from the beginning, both parents paid all the costs associated with maintenance of the
4 home, except for $165 paid by the son for a lawn implant. Id. And, almost from the beginning, both
5 parents pressed their son to transfer title of the property to them. Id. at 555. The son deferred. Id.
6 In 1981, the son separated from his wife and moved into the property and paid no rent to his
7 mother, his then surviving parent. Id. In 1984, the son told his mother that he was going to sell the house
8 and that she would have to move. She declined, asked her son again to transfer title to her, and sued for
9 declaratory relief of a resulting trust. Id.
10 The trial court held that the son had held the property as trustee for his mother under a resulting
11 trust. Id. at 1040–41, 43. In affirming the lower court’s judgment, the Court of Appeal held that the son
12 held the title of the property as a resulting trust for the parents, given the findings of the trial court based
13 on clear and convincing evidence. Id. at 555–56.
14 Here, in a single paragraph of four sentences, Will alleges that a resulting trust was created for
15 three reasons: (1) some amount of Will’s money was used to pay for the Belwood Property in 2017 and
16 2018; (2) despite the presumption in California law, Will’s payments were not a gift, as Will-Darnall
17 “paid rent”; and (3) the 2020 quitclaim transferring title to the Belwood Property from the Will-Darnall
18 Trust to Will is consistent with the obligation of Will-Darnall to convey the property to Will. Dkt. 104,
19 at 17. The government disputes the factual basis of each of these reasons.
20 Even if construed in Will’s favor, however, these allegations are insufficient as a matter of law.
21 First, the fact that Will’s money was allegedly used to purchase some portion of the Belwood Property is
22 insufficient to establish the existence of a resulting trust. Majewsky, 2 Cal. 3d at 485. This is particularly
23 so given the presumption that a parent’s purchase of property in the name of their child is intended as a
24 gift. In re Schechtman’s Est., 162 Cal. App. 2d at 369. Will does nothing to overcome that presumption.
25 Second, Will’s claim that Will-Darnall “paid rent” is contradicted by documents attached to her
26 amended claim in which the word “mortgage” repeatedly appears, unlike the word “rent.” Dkt. 104-7.
27 Thus, the Court need not—and should not—credit this claim. Sprewell v. Golden State Warriors, 266
28 F.3d 979, 990 (9th Cir.) (“[W]e are not required to accept as true conclusory allegations which are
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1 contradicted by documents referred to in the complaint[.]”), opinion amended on denial of reh’g, 275
2 F.3d 1187 (9th Cir. 2001).
3 Third, while Will asserts that the 2020 quitclaim is reflective of a preexisting obligation of Will-
4 Darnall to convey the Belwood Property to Will, the Court need not credit this assertion either, given the
5 undisputed fact that the transfer occurred just five days after Will-Darnall poured fraud proceeds into the
6 Belwood Property to “payoff” Will’s loan. Ex. AA. If Will’s claim is credited on this uncontested
7 record, the $971,504.21 “payoff” Will-Darnall provided to Will on June 15, 2020, would constitute an
8 advance rent payment for more than 200 years (assuming Will-Darnall’s rent remained fixed at $4600
9 (Dkt. 104-7)). That too is absurd.
10 Even if the 2020 quitclaim were evidence of some intent other than an intent to hide money from
11 the government, standing alone it cannot be considered sufficient to establish circumstances showing
12 that in 2017 or 2018—that is, at least two years earlier—Will-Darnall and Will intended for the creation
13 of a resulting trust for the benefit of Will in the Belwood Property.
14 Will of course cannot allege facts sufficient to support her fourth theory of relief because, among
15 other reasons, by her own admission:
16 1. Will has never taken a beneficial interest in the Belwood Property at any point in time given
17 she has resided in the Almaden Property continuously since 1995 (Dkt. 104-1 ¶ 5);
18 2. Will-Darnall has continuously taken a beneficial interest in the Belwood Property since
19 obtaining full legal title of the property (id. ¶¶ 12–14);
20 3. Will-Darnall has continuously represented to the world that the Belwood Property is her, not
21 Will’s, separate property (e.g., id. ¶ 17 (reflecting Will-Darnall obtained a loan secured by
22 the Belwood Property after her divorce), Dkt. 104-5 at 5, 104-6 at 5–6); and
23 4. Will’s own conduct—including securing a loan to Will-Darnall with the Belwood Property in
24 2019—reflects that she did not consider the Belwood Property her own.
25 Because Will has not alleged any circumstances (let alone plausible ones) showing that when
26 Will allegedly paid money for the Belwood Property it was intended between her and Will-Darnall that
27 Will, not Will-Darnall, take a beneficial interest in the Belwood Property, Will’s new theory of relief
28 must be dismissed with prejudice. United States v. Gutierrez, 734 F. App’x. 441, 446 (9th Cir. 2018)
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1 (affirming denial of third-party petitions based on alleged resulting trust when claimants did not show “it
2 was mutually intended that they would benefit from the property”).
3 C. Because Will Lacks A Cognizable Legal Interest In The Belwood Property, She
Lacks Standing To Assert A Constitutional Violation Concerning Its Forfeiture,
4 Which Is Proportional To Will-Darnall’s Crimes In Any Event.
5 The government incorporates by reference all arguments it previously asserted concerning Will’s
6 excessive fine argument. See Dkts. 77, at 24–25; 91, at 6–7.
7 CONCLUSION
8 The Court should grant the government’s motion to dismiss the first amended petition, dismiss
9 Will’s claim with prejudice, and enter a final order of forfeiture including the following:
10 1. Up to $746,372.98 in equity resulting from the sale of the Belwood Property;
11 2. A money judgment of $1,406,594.56; and
12 3. All funds up to $625,952.60 on deposit in a Vanguard account ending in 6846, and all
13 interest accrued since seizure of those funds.
14
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16 DATED: December 19, 2025 Respectfully submitted,
17 CRAIG H. MISSAKIAN
United States Attorney
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/s/
________________________
20 GALEN A. PHILLIPS
Assistant United States Attorney
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