US government and survivors of Bavispe cartel massacre dispute $1.2 million property seized from El Mencho’s son-in-law

Bills bearing Benjamin Franklin’s portrait were stacked one on top of another until they totaled $1.2 million. The cash was counted on a table to buy a luxury residence in an exclusive neighborhood of the Los Angeles metropolitan area. From the outset, the homeowner and the real estate agent suspected that a drug trafficker might be behind that mountain of money. Still, they closed the deal. They were, it turned out, correct: the mansion became the hideout of two figures tied to the Jalisco New Generation Cartel (CJNG). Now the residence is at the center of a legal battle between the U.S. government, which seized it, and victims of a massacre in Mexico seeking compensation for what they suffered.

During the summer of 2023, the residence, located on Pamplona Street in Riverside, passed into the hands of relatives of Nemesio Oseguera Cervantes, known as “El Mencho,” the founder of the CJNG. The purchase was made through the tequila company Pasión Azul, based in Jalisco and identified by authorities as one of the cartel’s businesses used to launder money. The liquor producer had carried out various moves to hinder tracing its financial operations. Among them, it registered more than 50 trademarks using different information.

It took a year before the DEA could confirm who was living in the house: Laisha Michelle Oseguera González, El Mencho’s youngest daughter, and her partner, Cristian Fernando Gutiérrez Ochoa, nicknamed “El Guacho” and considered a priority fugitive on both sides of the border.

An alert sent by Interpol to the Department of Homeland Security (DHS) in October 2024 put authorities on Gutiérrez Ochoa’s trail. The Mexican government was the first to learn that El Guacho was hiding in Riverside, right under the DEA’s nose. It later emerged that his father-in-law had spread a false rumor — that he had ordered him killed for having deceived him. As of December 2023, Mexico had lost track of him.

The downfall of ‘El Guacho’

In California, the capo posed as another person. He used the name Miguel Luis Martínez and, under that identity, tried to obtain a driver’s license. Within the cartel, meanwhile, they began referring to him by the code name El Palomo. DEA agents started following his movements and those of Laisha Michelle, who often went to a coffee shop she had opened in the neighboring city of Perris.

El Guacho’s face was captured on the home’s security cameras the day he went there to authorize its purchase. The property was built in 2003. It has four bedrooms and four bathrooms, a garage and a backyard pool. Its total area is 3,800 square feet. In 2020 it was assessed at $690,000, and the spike in the housing market has doubled its price, according to public records.

Gutiérrez Ochoa’s life in hiding ended on November 19, 2024, when the DEA arrested him and seized $2.2 million in cash. Agents also took the valuables that decorated the residence: works of art, sculptures, and paintings, as well as jewelry, watches, designer items and handbags. El Mencho’s son-in-law had a “ghost” gun — a homemade firearm without a traceable serial number — and another gun whose serial number had been removed. Three vehicles, including a BMW M4, were also seized. In total, the value of the luxury home and the goods amounted to $3.5 million, according to authorities.

Gutiérrez Ochoa agreed to surrender everything as part of a plea deal that reduced his case to a single charge of international money laundering. As a result, last December he received an 11-year, eight-month prison sentence. The government agreed to drop a drug-trafficking charge, for which he faced a possible life term.

The court battle

In November 2025, a month before sentence was handed down against El Mencho’s son-in-law, the survivors and relatives of the victims of the Bavispe massacre in the Sierra of Sonora filed a petition within the criminal case, lodged in a federal court for the District of Columbia, asking the government to turn over the assets seized from El Guacho. The legal action was filed on behalf of the LeBarón, Langford, Miller, Johnson and Ray families, members of a Mormon community that had been settled in that region of Mexico for decades. In court they identify themselves as “American Victims of Cartel Terrorism” (AVCT).

In that massacre — attributed to the Juárez Cartel and its armed wing, La Línea — three women and six American children traveling in a convoy on dirt roads were shot dead. In an unusual step, they sued that criminal organization in a federal court in North Dakota. The case went to trial and, in June 2022, a judge issued an extraordinary verdict: he ordered the cartel to pay $4.6 billion in damages.

The LeBaróns and the other families argue that, since the Jalisco New Generation Cartel has operated in alliance with the Juárez Cartel, they have the right to claim the residence where El Mencho’s relatives lived. In their petition they argue that Gutiérrez Ochoa acted significantly as an “agent or instrument of the CJNG,” which, in their view, would place him in an equivalent position to that of the Juárez Cartel. One of the main pieces of evidence they present is a U.S. Treasury Department statement, issued in October 2024, that said the CJNG had collaborated with La Línea since September 2023 as a “supplier of cocaine, methamphetamine and fentanyl.”

The U.S. government, however, opposes turning over the assets in its possession. In court documents it says that although these families “hold a judgment against the Juárez Cartel,” they have no right to claim CJNG assets, since it is “a completely distinct cartel.” It also argues that it has never been established that the Jalisco New Generation Cartel “played any role in the attacks” in Bavispe.

Prosecutors add that, although the Juárez Cartel and the CJNG maintain “a commercial relationship comparable to that between a wholesaler and a retailer of goods,” that link is not enough to consider the CJNG “an agent or instrument” of the Juárez cartel.

Judge Beryl A. Howell rejected the request that the government turn over the seized assets last April. In a 39-page opinion memorandum, the magistrate said the Bavispe massacre survivors had presented various arguments to the court but concluded that none carried sufficient weight to prevail. The LeBaróns and the other families have appealed the decision.

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