LSGT Services LLC v. County of Wood

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
February 13, 2025
A party may file with the Supreme Court a
Samuel A. Christensen petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.

Appeal No. 2024AP1572-FT Cir. Ct. No. 2024CV239

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT IV

LSGT SERVICES LLC,

PETITIONER-APPELLANT,

V.

COUNTY OF WOOD,

RESPONDENT-RESPONDENT.

APPEAL from an order of the circuit court for Wood County:
NICHOLAS J. BRAZEAU, JR., Judge. Affirmed.

Before Blanchard, Nashold, Taylor, JJ.

Per curiam opinions may not be cited in any court of this state as precedent

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3).

¶1 PER CURIAM. LSGT Services LLC, doing business as Coinhub
(“Coinhub”), appeals a circuit court order dismissing its petition for the return of
No. 2024AP1572-FT

$20,000 that the Wood County Sheriff’s Department seized from a bitcoin
automated teller machine (“ATM”) operated by Coinhub. For the reasons stated
below, we affirm.

BACKGROUND

¶2 The relevant facts are undisputed. Coinhub operates bitcoin ATMs
across the country. Coinhub’s ATMs allow customers to pay cash in exchange for
the cryptocurrency bitcoin. A customer inserts cash into a Coinhub ATM, and the
ATM transfers bitcoin to a digital wallet identified by the customer. Customers
are required to confirm that they are the sole owners of the digital wallets to which
the bitcoin will be transferred, and purchases and transfers made through
Coinhub’s ATMs are final and cannot be reversed.

¶3 In April 2024, an individual, S.A., was scammed into paying
$20,000 cash at a Coinhub ATM and transferring the bitcoin into the digital wallet
of the unknown scammer. A deputy from the Wood County Sherriff’s Department
obtained a search warrant authorizing the seizure of $20,000 in cash from the
Coinhub ATM that S.A. had used. The warrant stated that the $20,000 might
constitute evidence of theft by fraud in violation of WIS. STAT. § 943.20(1)(d).1

¶4 Coinhub filed a petition in the circuit court pursuant to WIS. STAT.
§ 968.20 for the return of the $20,000 that had been seized. Wood County
responded by informing Coinhub and the court that the Wood County Sheriff’s
Department had turned over the $20,000 to S.A. The County did not take a
position on whether Coinhub had a right to the return of the $20,000, but the

1
All references to the Wisconsin Statutes are to the 2021-22 version.

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County argued that because it no longer possessed the $20,000, Coinhub had no
right of recovery against the County under § 968.20. In support of this argument,
the County relied on City of Milwaukee v. Glass, 2001 WI 61, 243 Wis. 2d 636,
628 N.W.2d 343.

¶5 The circuit court held a hearing, at which it denied Coinhub’s
petition for the return of the $20,000 and dismissed the action.2 As we explain in
greater detail below, the court did so based on its interpretation of Glass.

¶6 Coinhub appeals.3

DISCUSSION

¶7 The sole question on appeal is whether the circuit court, based on
Glass, improperly dismissed Coinhub’s petition for the return of the $20,000 to
Coinhub pursuant to WIS. STAT. § 968.20. We conclude that, consistent with
Glass, the court properly dismissed Coinhub’s action under § 968.20.

¶8 WISCONSIN STAT. § 968.20(1) states in relevant part, “Any person
claiming the right to possession of property … seized pursuant to a search warrant
… may apply for its return to the circuit court for the county in which the property
was seized ….” Section 968.20(1g) states, “The court shall hold a hearing to hear

2
Only Coinhub and the County were represented at the hearing. At the beginning of the
hearing, counsel for the County informed the circuit court that counsel had spoken with S.A. and
that S.A. would not be present.
3
In an August 14, 2024 order, the court placed this case on the expedited appeals
calendar, and the parties have submitted memo briefs. See WIS. STAT. RULE 809.17. Briefing
was complete on November 4, 2024.

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all claims to its true ownership.... If the right to possession is proved to the court’s
satisfaction, it shall order the property … returned ….”4

¶9 In Glass, the Milwaukee police went to Glass’s garage to investigate
a complaint of theft from a construction site. Glass, 243 Wis. 2d 636, ¶3. Inside
the garage, officers observed property that they believed to be stolen, and they
arrested Glass and seized the property. Id. After the State’s criminal charges
against Glass were dismissed, Glass petitioned for the return of the seized property
pursuant to WIS. STAT. § 968.20. Id., ¶4. The City of Milwaukee moved to
dismiss Glass’s petition because the City no longer possessed the property: police
had turned the property over to a third party whom police believed was the rightful
owner of the property. Id., ¶¶5, 8. The circuit court awarded Glass $1,606.80,
which Glass had established was the fair market value of the seized property
disposed of by the City. Id., ¶10.

4
Specifically, WIS. STAT. § 968.20(1g) states that the circuit court shall order the
property returned to the claimant if the court determines any of the following:

(a) It is likely that the final judgment will be that the
state must return the property to the claimant and the property is
not reasonably needed as evidence or for other investigatory
reasons or, if needed, satisfactory arrangements can be made for
its return for subsequent use.

(am) The property is the only reasonable means for a
defendant to pay for legal representation in the forfeiture or
criminal proceeding, the property is not likely to be needed for
payment of victim compensation, restitution, or fines, and the
property is not reasonably needed as evidence or for other
investigatory reasons. If the court makes this finding, it may
order the return of funds or property sufficient to obtain legal
counsel but less than the total amount seized and require an
accounting.

(b) All proceedings and investigations in which it might
be required have been completed.

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¶10 This court reversed the circuit court’s order, with Judge Schudson
dissenting, and our supreme court affirmed that reversal, concluding that Glass
could not obtain monetary damages against the City pursuant to WIS. STAT.
§ 968.20. Id., ¶¶11, 20, 29. Our supreme court first concluded that, “[c]onsidering
the aims and objects of a WIS. STAT. § 968.20 action and the procedure set forth in
WIS. STAT. § 968.20,” § 968.20 “establishes an in rem proceeding.” Id., ¶19; see
also id., ¶16 (“Section 968.20 appears to describe an in rem action in that it
authorizes a circuit court to determine the ownership of seized property and order
its return.”); id., ¶18 (“Section 968.20 does not set forth grounds for personal
jurisdiction over the parties and does not provide for a judgment against any
defendant personally. Section 968.20 thus does not seem to describe an in
personam action.”). The court then concluded that Glass could not obtain
monetary damages against the City pursuant to § 968.20 for two reasons: first,
because § 968.20 “does not expressly state that a circuit court may award
monetary damages if seized property is not returned”; and second, because the
circuit court did not obtain personal jurisdiction over the City, which was required
to award monetary damages against the City. Id., ¶20.

¶11 Relevant here, the Glass court also stated the following:

In affirming the court of appeals, we pay heed to
Judge Schudson’s dissent, which noted that the plaintiff, “a
pro se litigant, will be amazed that this court casts him back
into a legal maze.” However, we can discern no alternative
under WIS. STAT. § 968.20, which sets forth a simplified
means for returning seized property. Section 968.20 rests
on the assumption that a person who seizes property will
retain possession of the seized property. Indeed, this
assumption would be in keeping with WIS. STAT. § 968.19,
entitled “Custody of property seized,” which requires
seized property to be safely kept. Section 968.19 provides:

Property seized under a search
warrant or validly seized without a warrant

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No. 2024AP1572-FT

shall be safely kept by the officer, who may
leave it in the custody of the sheriff and take
a receipt therefor, so long as necessary for
the purpose of being produced as evidence
on any trial.

Although we are sympathetic to the plaintiff’s
contention that an individual whose property has been
seized should not be denied a simplified remedy merely
because authorities have unlawfully disposed of the
property, we conclude that it is for the legislature, not the
courts, to create that simplified remedy.

Id., ¶¶27-28.

¶12 As stated, the circuit court here denied Coinhub’s petition for the
return of the $20,000 based on Glass. The court concluded, “I think [Glass] really
clearly says that I can’t grant you the relief that you want in this action, and so I
deny the petition and I am going to dismiss this action.” The court further
observed:

[Glass is] a really interesting case when it talks about the
unfairness of this process, but this is just the wrong statute
is the way that I read this case, and that certainly doesn’t
mean that [Coinhub] isn’t entitled to the return of $20,000
through a different method, but I think that I have to deny
the petition here and dismiss this action[.]

¶13 Consistent with Glass, we conclude that the circuit court properly
dismissed Coinhub’s action under WIS. STAT. § 968.20 because the County no
longer possessed the $20,000. As here, Glass’s petition was for the return of
property seized pursuant to § 968.20. Id., ¶¶1, 4. But the Glass court stated,
“Section 968.20 rests on the assumption that a person who seizes property will
retain possession of the seized property.” Id., ¶27. Further, after describing
§ 968.20 as “a simplified means for returning seized property,” the court stated
that it was sympathetic to Glass’s argument that he should not be “denied a
simplified remedy merely because authorities have unlawfully disposed of the

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property” but concluded that “it is for the legislature, not the courts, to create that
simplified remedy.” Id., ¶¶27-28. We conclude that the circuit court properly
construed Glass as meaning that the simplified procedures under § 968.20 are
unavailable when the seized property is no longer in the possession of the entity
that seized it. Id., ¶27.

¶14 Coinhub argues that the Glass court addressed an issue different
from that presented in this case because here, Coinhub explicitly informed the
circuit court that it was not seeking monetary damages against the County and
sought only a determination that it was the lawful owner of the seized property and
an order for its return. To be sure, the Glass court stated that the issue before it
was “whether WIS. STAT. § 968.20 authorizes a circuit court to award a plaintiff
the fair market value of seized property when the City no longer has possession of
the seized property.” Id., ¶12. However, in resolving that issue, the court used the
broad language quoted above, conveying that the procedures in § 968.20 cannot be
invoked when the property is no longer in the possession of the entity that seized
it. Although the Glass court made these broader statements in the context of
deciding the more specific issue regarding a circuit court’s authority to award the
fair market value of seized property under § 968.20, we are bound by these
statements and are not at liberty to deem them dicta. See Cook v. Cook, 208
Wis. 2d 166, 189, 560 N.W.2d 246 (1997) (“The supreme court is the only state
court with the power to overrule, modify or withdraw language from a previous
supreme court case.”); Zarder v. Humana Ins. Co., 2010 WI 35, ¶58, 324 Wis. 2d
325, 782 N.W.2d 682 (“[T]he court of appeals may not dismiss a statement from
an opinion by this court by concluding that it is dictum.”).

¶15 Coinhub further argues that Glass “clearly allows for a
determination of ownership and order for return” under WIS. STAT. § 968.20,

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No. 2024AP1572-FT

which is the remedy that Coinhub seeks here. We reject this interpretation, given
the language in Glass quoted above, which conveys that this remedy is not
available when the seizing entity no longer possesses the property.

¶16 Echoing points made by the court in Glass, Coinhub also points out
the potential for unfairness that can result from the interpretation of WIS. STAT.
§ 968.20 stated in Glass. Coinhub asserts that this interpretation renders numerous
other statutes “useless” and that, even if the County no longer possessed the
$20,000 at the time of the circuit court proceedings, an order under § 968.20 could
still provide relief in various ways. However, because we are bound by the
language from Glass discussed above, we do not address these arguments further.
See Cook, 208 Wis. 2d 166, 189; Zarder, 324 Wis. 2d 325, ¶58.5

¶17 In sum, because the County no longer possesses the $20,000 seized
from Coinhub, Glass precludes Coinhub from availing itself of the “simplified
means for returning seized property” under WIS. STAT. § 968.20.

CONCLUSION

¶18 For the reasons stated above, we affirm.

5
Coinhub briefly suggests that the County “has not demonstrated that the actual bills it
gave to S.A. are the same bills seized from Coinhub” and that, as a result, the County “may still
have the seized bills.” To the extent that Coinhub intends to advance this fact-based assertion as
a separate argument, we reject it because Coinhub failed to raise it in the circuit court. See Schill
v. Wisconsin Rapids Sch. Dist., 2010 WI 86, ¶45 & n.21, 327 Wis. 2d 572, 786 N.W.2d 177
(explaining that issues not raised in the circuit court are forfeited, and supporting the proposition
that appellate courts generally do not address forfeited issues).

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By the Court.—Order affirmed.

This opinion will not be published. See WIS. STAT.
RULE 809.23(1)(b)5.

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