Mint asks court to dismiss 1974-D cent suit
- Published: Jun 6, 2014, 5 AM
The U.S. Mint continues to contend that 1974-D Lincoln aluminum cents were never authorized to be issued as a coin or made legal tender and, as such, cannot be privately owned.
The Mint filed a response on June 3 in a San Diego federal court asking that the court dismiss a March 14 lawsuit filed by Randall Lawrence and Michael McConnell. The two men sought declaratory judgment affirming that an example of the experimental cent is not government property and can be privately owned.
Lawrence inherited the cent from his father, who enjoyed a long career at the Denver Mint. In September 2013, La Jolla, Calif., coin dealer McConnell purchased the cent from Lawrence and the two filed the motion jointly against the U.S. Treasury, U.S. Mint and the United States of America.
Prior to the filing of the lawsuit, Daniel P. Shaver, the Mint’s chief legal counsel, sent separate letters to the two men dated Feb. 26, 2014, demanding the return of the 1974-D Lincoln aluminum cent. A similar letter was sent to Heritage Auctions at that time. The cent, graded Mint State 63 by Professional Coin Grading Service, was set to be a highlight of Heritage Auctions April 24 Central States Numismatic Society auction but was withdrawn at the government’s request.
The U.S. Mint’s motion to dismiss the complaint for failure to state a claim states that the Mint has the exclusive authority to mint and issue U.S. coins. It added, “Items made at United States Mint facilities but not lawfully issued, or otherwise lawfully disposed of, remain Government property and are not souvenirs that United States Mint officials can remove and pass down to their heirs.”
In its motion the Mint acknowledged that the Mint and the Treasury had proposed and supported a bill in 1974 to change the composition of the 1-cent coin from predominantly copper to aluminum. That legislation did not become law. The motion concluded that the piece (as distinguished from a legally issued coin) described as a “?‘1974-D Aluminum Cent’ is an unauthorized, unissued piece” struck at the Denver Mint, but unlawfully removed from the facility.
Both sides acknowledge that there are no Mint records and no documentary evidence of aluminum 1974 Lincoln cents struck at the Denver Mint. A Feb. 17, 2014, article in Coin World about PCGS’s authentication of the piece cites an interview with Benito Martinez, a die setter at the Denver Mint in 1974, who recalls striking fewer than a dozen of the experimental 1974-D Lincoln cents on aluminum blanks that had been supplied from the Philadelphia Mint.
In contrast, more than 1.5 million 1974 Lincoln aluminum cents were struck at the Philadelphia Mint. Although nearly all were destroyed, one is known in private hands and a second piece is part of the National Numismatic Collection at the Smithsonian Institution.
Not authorized or legal tender
The core of the Mint’s argument is that the 1974-D Lincoln aluminum cent was never authorized to be issued as a coin or legal tender. Since Congress never passed legislation authorizing the secretary of the Treasury to change the composition, and only Congress has the authority to set denominations, standards and weights for coins including the 5-cent and 1-cent piece, the aluminum cent could not be issued as legal tender absent congressional approval.
Further, the Mint contends that a 1974-D Lincoln aluminum cent is not a numismatic item authorized to be offered or sold to the public.
The Mint writes that the initial complaint does not allege facts that Lawrence’s father obtained the piece as an authorized numismatic item in his role as an assistant superintendent at the Denver Mint. It adds that the original filing is “silent as to how Lawrence’s father came into possession of the piece” before characterizing the circumstances as “murky,” given that Lawrence’s father was not present at the Denver Mint when it was struck.
The Mint claims the item as government property, and since only Congress has the power to dispose of government property, it cannot be legally owned.
To support this, the government cites the recent Langbord case where a jury decided in favor of the government’s property interest in 10 1933 Saint-Gaudens gold $20 double eagles. In the present filing, the Mint characterizes the Langbord case as upholding the government’s “interest in coins that had been stolen or, through fraudulent breach of trust, taken from the United States Mint at Philadelphia over 75 years ago.”
The Mint concludes its request by writing, “Plaintiffs have not asserted any facts that would support any scenario under which they could plausibly be in lawful possession of the piece: that the piece was lawfully issued as legal tender, lawfully issued or offered for sale to the public as a numismatic item, or otherwise lawfully removed from the Government.”
A hearing is set for July 7.
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