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Legal battle over motorcycle club’s logo creates headache for feds

By Michael Doyle, McClatchy Newspapers –

WASHINGTON — An unprecedented federal government effort to seize the Mongols Motorcycle Club’s trademark has quietly become a quarter-of-a-million-dollar headache for the Justice Department.

Four years after prosecutors grabbed attention by lassoing the Mongols’ logo — a ponytailed man riding a motorcycle — along with myriad club members in Southern California, an appellate court must sort out what the federal government might owe the club’s attorneys.

It could be a lot, in a free-speech case that’s also a cautionary tale about aggressive federal use of forfeiture to seize private property.

“What they did was an outrageous violation of the First Amendment, and an absolute abuse of forfeiture and trademark laws,” American Civil Liberties Union attorney David Loy said Monday in a telephone interview.

Rebuking prosecutorial overreach, a federal judge in Los Angeles ordered the Justice Department to pay $253,206 to Loy, who’s with the ACLU of San Diego & Imperial Counties, and Alan Mansfield, an attorney with Consumer Law Group of California, in San Diego.

Loy and Mansfield successfully challenged the prosecutors’ 2008 attempt to seize the Mongols’ trademark. The Justice Department is appealing the judge’s order to pay, however, with the 9th U.S. Circuit Court of Appeals likely to hear the case next year.

Forfeitures are big business for the federal government. Last year, the Justice Department seized some $1.8 billion worth of forfeited assets. Typically, these are ill-gotten gains from drug trafficking, financial fraud and other criminal activity.

Los Angeles-based prosecutors claimed a huge haul in October 2008 when they announced mass indictments of those they called “violent Mongols outlaw motorcycle gang” members. The indictments followed a lengthy undercover investigation by four agents of the federal Bureau of Alcohol, Tobacco, Firearms and Explosives, who managed to become patch-wearing members of the club.

Prosecutors subsequently secured more than 80 convictions, mostly on racketeering and conspiracy charges. Investigators also seized hundreds of firearms, thousands of rounds of ammunition, stacks of dollar bills and other items, opening one legal front that’s still active.

On Tuesday, in Los Angeles, a federal judge will hear an ongoing challenge to some of the property seizures. The judge already has returned some motorcycles to other Mongols.

In addition to physical assets, prosecutors sought in 2008 to claim the Mongols’ trademarked name and logo.

“If any law enforcement officer sees a Mongol wearing his patch, he will be authorized to stop that gang member and literally take the jacket right off his back,” then-U.S. Attorney Thomas P. O’Brien declared at the time.

A U.S. Attorney’s Office spokesman couldn’t be reached Monday, a federal holiday.

A Republican appointee, O’Brien left office in 2009. Justice Department lawyers eventually said they wouldn’t seek to seize the Mongols’ trademark after all. But a judge in Los Angeles ruled last year that prosecutors had gone too far.

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