Submitted October 8, 2014.
Appeal from United States District Court for the District of Minnesota - St. Paul.
For United States of America, Plaintiff - Appellee: David Gerald Wilhelm, Assistant U.S. Attorney, U.S. ATTORNEY'S OFFICE, District of Minnesota, Minneapolis, MN.
Robert Lee Bailey, Defendant - Appellant, Pro se, Duluth, MN.
For Robert Lee Bailey, Defendant - Appellant: Jordan S. Kushner, Minneapolis, MN.
Before MURPHY, BYE, and SHEPHERD, Circuit Judges.
MURPHY, Circuit Judge.
Appellant Robert Lee Bailey settled a damages claim for lost property with the United States government. He later moved the district court to vacate his settlement agreement with the United States, arguing that the government had breached the contract by administratively offsetting the settlement proceeds against his preexisting child support obligation. The district court denied his motion to vacate. We affirm.
The United States had tried Bailey for prostitution related charges in 2004. During the trial, Minneapolis police officers took exhibits overnight to a locked storage facility in the Minneapolis police department. Bailey was convicted and sentenced. Some items not subject to forfeiture that had been seized from Bailey and later brought to the department during the trial included $2,036 in cash, a wallet, and a cell phone. Years later, as Bailey's prison term neared completion, he moved the district court for return of this property, but the government could not locate it. The district court denied Bailey's motion.
This court reversed and remanded for an evidentiary hearing to determine who last had had custody of the property. United States v. Bailey, 407 F.App'x 74, 75 (8th Cir. 2011). The evidence at the hearing suggested that the property went missing following its use at trial. Two federal witnesses testified that after the trial Minneapolis police took the cash to return it to their locked police property room, but the items were not found by police officers in the ensuing search of the room.
Bailey moved the district court to convert his motion for return of property under Federal Rule of Criminal Procedure 41 into an action for damages against the United States; his motion was denied. Our court reversed and remanded so that Bailey could pursue a damages action. United States v. Bailey, 700 F.3d 1149, 1153 (8th Cir. 2012). Following remand the government and Bailey entered into a settlement agreement, and the government agreed to pay Bailey $2,500 as compensation for the lost property. A settlement agreement was executed on February 5, 2013. It provided that the payment would " be made by a check drawn on the Treasury of the United States . . . made payable to Robert Bailey" and would be mailed to the address of his lawyer.
As it turned out, Bailey had an outstanding child support obligation in the state of Illinois. On September 28, 2012, the Illinois Department of Healthcare and Family
Services mailed Bailey a notice informing him that he owed past due support in the amount of $45,956.48. The notice announced the state's " intent to collect this amount through the federal administrative offset process and by withholding . . . [tax refunds] or other federal or state payment(s)." The notice cited 31 U.S.C. § 3716, the statute governing the administrative offset process, and indicated that under the process " certain federal payments which might otherwise be paid to you will be intercepted for payment of current ...