Federal Government Set to Reclaim Rare Double Eagle Coins
The federal government recently won a decade-long legal battle over the ownership of rare Double Eagles coins. The Third Circuit Court of Appeals upheld the lower court’s decision ordering a Philadelphia family to surrender ten 1933 Saint-Gaudens Gold Double Eagles found in a safe deposit box.
History of the 1933 Double Eagles
The 1933 Gold Double Eagles, designed by sculptor Augustus Saint-Gaudens, are considered among the most valuable coins in the world. The rare coins are unique because they were never officially issued.
In 1933, Franklin D. Roosevelt officially ended the gold standard, the system of currency by which the U.S. dollar was backed by gold. Executive Order 6102 required Americans to turn in all gold coins and gold certificates in denominations of more than $100 in exchange for other money. That same year, the U.S. Mint struck 445,500 Double Eagles. However, in accordance with Roosevelt’s Executive Order banning gold, they were never issued. Instead, all but 500 of the 1933 Double Eagles were placed into the Mint’s vault in June 1933. The remaining coins were held by the Mint’s Cashier; of those, twenty-nine were destroyed during testing and two were sent to the Smithsonian Institution in October 1934.
While all of the 1933 Double Eagles held at the Philadelphia Mint were supposed to have been melted, several turned up in the hands of collectors. A subsequent investigation revealed that several Double Eagles had been stolen from the Mint by George McCann, who served as the Mint’s Cashier from 1934 to 1940. The Secret Service also concluded that the coins had been distributed by a Philadelphia jeweler named Israel Switt.
The federal government believed it had recovered all of the coins, with the exception of one 1933 Double Eagle sold to King Farouk of Egypt in 1944, which most recently sold at auction in 2002 for $7,590,020. The federal government had attempted to seize the coin and ultimately shared in the proceeds of the sale under a settlement agreement with its owner, a British coin collector.
The Legal Battle Over the Remaining Double Eagles
In 2003, Joan Langbord, the daughter of Israel Switt, allegedly discovered ten 1933 Double Eagles in a family safe-deposit box. Her attorney contacted the U.S. Mint to verify their authenticity and settle the Langbord’s ownership claim. The Mint took possession of the coins for verification purposes and refused to return them, arguing that the Double Eagles were stolen property of the federal government.
In 2006, the Langbords sued the federal government, claiming the Double Eagles were seized without due process. After a jury sided with the government, a three-judge panel of the Third Circuit reversed. It held that that Double Eagles should be returned to the Langbords because the U.S. Mint failed to follow the procedures set forth in Civil Asset Forfeiture Reform Act of 2000 (CAFRA). The victory was short-lived, as the full Third Circuit Court of Appeals agreed to rehear the case.
The Third Circuit’s Decision
This time around, the Third Circuit sided with the government. It agreed that the government need not comply with CAFRA’s forfeiture procedures because the government was simply repossessing its own property. “[T]he Langbords’ seized asset claim was akin to filing a petition for writ of habeas corpus on behalf of someone not in custody,” Judge Thomas Hardiman wrote for the majority.
In reaching its decision, the Third Circuit rejected the Langbord’s argument that the coins could have been legally acquired. Citing the testimony of a 1933 Double Eagle historian and a forensic accountant, the appeals court concluded “it is clear that not a single 1933 Double Eagle was ever authorized to be issued to the public.”
Notably, the Third Circuit’s decision was not unanimous, with three judges dissenting. “This case involves precisely the type of situation that CAFRA was enacted to prevent: the Government’s seizing and taking ownership of property in derogation of the rights of ordinary citizens,” Judge Marjorie Rendell argued.
The Langbord family has vowed to appeal. Ultimately, the Supreme Court could have the last word in this fascinating case.