By Charles Morgan for CoinWeek …..
Three-judge ruling in Langbord et al v. U.S. Department of the Treasury et al puts renewed spotlight on 10 contraband coins…
Little more than a week after a federal judge in California sided against the Federal Government in its efforts to seize an experimental 1974-D aluminum cent pattern coin, the United States Third Circuit Court of Appeals dealt a blow to the government’s case that it had the right to seize 10 1933 double eagle $20 gold coins belonging to the Langbord family.
The Langbord double eagles came to national prominence in 2004, when a representative of the family informed the government of their existence and sent the coins to the U.S. Mint for authentication.
The family alleges that they discovered the coins in a safe deposit box belonging to their late father, Philadelphia coin dealer Israel Switt. The U.S Mint believes that Switt collaborated with a Mint employee to smuggle out a number of 1933 double eagles after President Roosevelt issued a series of executive orders recalling the nation’s gold coinage (the United States was in the midst of a banking crisis at the time). While 445,000 double eagles bearing the date 1933 were struck, fewer than 25 discreet examples are known to have been held in private hands.
Selling a 1933 double was once a routine affair
With today’s Court decision, the 10 coins–valued at more than $1 million each–might one day be offered for sale. It would be a spectacular turn of events, since the only “legally held” 1933 double eagle, alleged to have once belonged to Egypt’s King Farouk, sold for more than $7 million at a 2002 auction conducted by Stack’s Bowers and Sotheby’s.
That coin came with an official document signed by the U.S. Mint stating that no other 1933 double eagle would ever be legal to own.
The introduction of 10 new coins, especially if they prove to be better preserved, could prove deleterious to the value of the “Farouk” piece. At which point, it’s conceivable that the owner of that coin might seek redress in federal court.
As complex as the situation appears to be, there was a time when the sale of 1933 double eagles was a routine affair.
Through the early 1940s, a handful of 1933 double eagles were sold through dealers or at auction, and while they were considered rare at the time (it was believed that the Mint had destroyed the entirety of their 1933 output), there was no feeling among the collecting community that the coins were illegal to own.
All that changed in 1944, after the U.S. Secret Service launched an investigation into the coin’s distribution. The Mint, finding no records to show that the coins were ever monetized or released into circulation, believed the coins to be stolen.
Since then, the government has considered all 1933 double eagles to be contraband.
It appears that that position may be about to change.
In the court’s opinion, Third Circuit Judge Marjorie Rendell wrote that the government was “obligated to bring a judicial civil forfeiture proceeding or to return the property…. Having failed to do so, it must return the Double Eagles”. See PDF of Opinion Here….
Now all the Langbords can do is wait; no timetable has been announced regarding the return of “John Does” 1-10 (the coins were actually parties to the case). The U.S. Attorneys in charge of the case have yet to decide what further action (if any) they will take.
Langbord et al v. U.S. Department of the Treasury et al, 12-4574 (3rd Cir. 2015)