Responses to foreclosure actions against three properties associated with a suspected illegal marijuana-growing operation in Montezuma County have been extended into mid-June.
The three properties are the Ocean Pearl Restaurant on Main Street in Cortez, a home on South Chestnut Street in Cortez and a farm on Montezuma County Road V in Lewis.
Mike McLachlan, who represents Qi Wu, who operates Ocean Pearl and has power of attorney over all three properties, said forfeiture of the farm, 21875 Road V, is being sought by the U.S. Attorney’s Office.
He said he is negotiating with the U.S. Attorney’s Office on forfeiture of the house at 316 S. Chestnut St.
However, he said the Ocean Pearl restaurant, 300 E. Main St., is not under threat of federal forfeiture.
In addition, McLachlan said the restaurant and the house are current on mortgage payments. Only the farm is not current on its mortgage, he said.
A response to the foreclosure actions has been extended until June 18, he said.
All three properties were among a handful of sites raided by multiple agencies in August 2018 in connection to a Chinese or Chinese-speaking drug ring under investigation since a large raid in Rifle in 2016, according to the Drug Enforcement Agency in Grand Junction.
The grantors listed on the foreclosure notices are Jimmy Dang and Qi Yu Wu, who were both arrested and charged in U.S. District Court with manufacture and possession with intent to distribute 1,000 or more marijuana plants, according to the U.S. Attorney’s Office.
Jimmy Dang is Qi Wu’s husband, and Qi Yu Wu is Qi Wu’s brother.
Qi Wu has not been arrested in connection with the suspected illegal marijuana operation.
According to legal notices, the reason listed for the Lewis farm’s foreclosure is “Default in payments and other Violations of Deed of Trust covenants.” For this property, with a deed of trust date of June 20, 2014, the original principal amount is listed as $107,000.
The other two properties were combined on the same notice, both with a deed of trust date of Aug. 5, 2011. The reason for their foreclosures was listed as “Violations of Deed of Trust covenants.”
According to the Montezuma County Assessor’s website, the Ocean Pearl property was purchased for $195,000 in September 2010, the South Chestnut Street home for $206,500 in August 2011, and the Lewis farm property for $139,000 in June 2014.
Keenen Lovett, an attorney with the Cortez firm Kelly R. McCabe, represents the Dolores State Bank, the lien holder in the foreclosures. He has told The Journal the case is in litigation, and if defendants Jimmy Dang and Qi Yu Wu are able to prove they have not violated the deeds’ covenants, the restaurant and home will not be put up for public auction. If they prove they have not violated the deed’s covenant and provide the payments they owe on the farm, it also would not be put up for public auction, he said.
Lovett would not specify what the deed covenant violations were, citing the ongoing litigation, but added that the defendants had requested time extensions on the court foreclosure hearing to gather additional evidence.