Gang enforcement hits trademark snag

By Daily Journal 

Santa Ana  - A judge wrestled Monday with the unprecedented question of whether federal prosecutors can snatch away trademarks of the notorious Mongols motorcycle gang to prevent members from wearing the gang's patch or using the Mongol name. 

U.S. District Judge David O. Carter Called the issue one of the first impression. Prosecutors have been trying since 2008 to strip the gang of its property interest in its name and its logo, which has been described as showing Genghis Khan in sunglasses riding a motorcycle.

Three federal judges - including Carter- have blocked efforts to take the gang's trademarks through criminal forfeiture in two previous cases. But Carter said those cases involved different parties and somewhat different issues.

The late U.S. District Judge Florence Marie Cooper initially allowed forfeiture and issued an injunction against use of the marks as part of a racketeering case against 80 senior gang members. But in 2009, she reversed her rulings after learning the name and logo were "collective membership marks" under trademark law, not traditional commercial trademarks. 

The mongols registered the marks in 2005 and 2006. 

Carter and U.S. District Judge Otis D. Wright II took over the cases and related civil actions. Each eventually blocked forfeiture on the ground that the marks belonged to the gang as an entity, not the individual gang member defendants. In a civil suit by a gang affiliate not charged criminally, Carter found prosecutors' forfeiture attempt was not "substantially justified," and he sanctioned the prosecution $253,206. Rivera v. United States, CV09-2435 (C.D. Calif. Aug. 3, 2009). 

After 79 defendants pleaded guilty - the 80th died- Assistant U.S. Attorneys Christopher N. Brunwin and Steven R. Welk filed charges against the gang. United States v. Mongol Nation, CR 13-106 (filed Feb. 13, 2013). 

At a hearing Monday, defense attorney Joseph A. Yanny asked Carter to dismiss the indictment
against the gang and impose new sanctions on the prosecution. He argued that the judges' previous rulings dictate how Carter must rule on forfeiture this time. 

"There was a full and fair litigation of the issue, and the government lost it," he said. "They can't come back and get a second bite of the apple."

Allowing forfeiture of the Mongols' name and patch logo would infringe the First Amendment rights of people connected to the motorcycle club who haven't committed crimes, he said, pointing to the few dozen men - many with beards and long hair - filling the spectator seats in the courtroom. 

The real purpose of the indictment "is to victimize the 700 to 800 members who've done nothing wrong," he said. "Justice has already been done, and anything further is going to be an injustice."

Welk argues that determining who had a property interest in the name and logo had to be determined at trial. 

Carter indicated he agreed with the prosecutors that questions of forfeiture could only be decided after conviction. "Now is not the time to decide the propriety of...a potential forfeiture after a potential conviction," he said. 

Carter said he was troubled by another issue, whether the RICO indictment itself is proper. The indictment names the Mongol Nation, an unincorporated association, as the defendant and alleges it conspired and committed crimes with the broader Mongol gang. 

"I find it difficult to see a meaningful distinction between the Mongol Nation and the Mongols gang," Carter said. 

He said the indictment identifies the nation as the "person" charged with racketeering crimes and defines the "enterprise" with which it committed its crimes to include members and other associates of the broader gang. 

"It seems to collapse on itself," he said. 

The RICO statute "has to do with imprisonment or punishment of individuals," Carter said. "I can't imagine that Congress ever envisioned the situation before this court."

The prosecutors argues the Mongol Nation consists of "full patch" members of the gang who have an ownership interest in the trademarked logo and name. However, the gang associates, probationary members and "hang-arounds" they worked with are also part of the gang enterprise. 

"We are talking about different persons with different legal status," Brunwin said.  All of them " were joining with the enterprise to commit crimes."

Noting that corporations have been charged with RICO violations, he said that "an organization can own property, and that's why it can be prosecuted."

Yanny urged Carter to use the inherent authority of the court strike the forfeiture allegations from the indictment as "surplusage" now. If the judge did that, he said, the U.S. attorney's office might decide to drop the whole case. 

The judge ordered the two sides return to his court Monday afternoon to continue argument. He did not indicate when he might issue a decision.