A federal jury on Friday convicted a Billings man the government had accused of trafficking "massive'' amounts of methamphetamine for about five years on one count but found him not guilty on two other charges.
The jury found Larry John Dauenhauer, 65, guilty of possession with intent to distribute and not guilty of conspiracy and possessing a firearm in furtherance of drug trafficking.
The panel deliberated nine hours Friday before delivering its verdict at about 7:15 p.m. in the four-day trial.
Senior U.S. District Judge Jack Shanstrom then asked the jury to return to deliberations on the forfeiture of Dauenhauer's home, and a large amount of cash and guns that were found.
The jury decided that Dauenhauer had to forfeit property, including his central Billings residence.
They voted not to impose a $300,000 fine or forfeitures of another $23,000 in cash and firearms.
Shanstrom did not set a sentencing date for Dauenhauer, but they typically happen about three months later.
Dauenhauer faces a minimum mandatory 10 years to life in prison and a maximum $4 million fine on the drug conviction.
He denied the charges, telling the jury late Thursday afternoon that he shared small amounts of meth with some people but didn't have large amounts for distribution.
He called the convicted drug dealers who testified that they regularly got quarter- and half-pound quantities of meth from him all liars. Testimony from two of the drug dealers indicated they got a combined total of at least 49 pounds of meth from Dauenhauer.
Dauenhauer's attorney, Robert Stephens, said the government failed to present any evidence of a conspiracy and that the drug addicts who testified against Dauenhauer were mentally ill snitches and not credible.
Assistant U.S. Attorney Jim Seykora said Dauenhauer used his house at 1203 Lynn Ave. to store and distribute meth to a number of people in a secretive operation. The government doesn't know who Dauenhauer conspired with to get the meth, he said, but testimony from about eight witnesses who said they got meth from Dauenhauer showed he "had massive amount of meth. He's the top of that pyramid."
During a search of Dauenhauer's house on July 7, 2010, agents found $23,000 in cash, including $10,000 hidden under a silverware drawer, about 27 grams, or almost an ounce, of meth and a Mossberg shotgun on the couch in the living room, strategically placed to protect his cash and the meth, Seykora said. Dauenhauer had modified the shotgun to have a pistol grip, he said.
Drug evidence included 105.4 grams, or almost 4 ounces, of 100 percent pure meth that was seized in the home of Linda Selph, a Billings drug trafficker serving a 13-year federal sentence on a conspiracy conviction.
Selph testified that she got the meth from Dauenhauer, who supplied her with "at least 30 pounds." At one point, Selph said, Dauenhauer was supplying her daily with a quarter-pound of meth, which cost about $7,200. She's take the cash back to him, she said.
"I'd resell it. I was really busy selling meth," she said.
Selph also said she saw two men drive their car into Dauenhauer's garage and saw a package about the size of a volleyball covered with red grease. Dauenhauer, she said, told her it was dope and that she shouldn't have seen it.
Another government witness, David Sims, of Billings, who is serving a nine-year federal trafficking sentence, told the jury he got about 19 pounds of meth from Dauenhauer until Dauenhauer cut him off over a $10,000 debt.
Sims said his girlfriend, Kristi Smith, then went to Dauenhauer's for meth, which they'd distribute to support their habits.
Smith, who is awaiting sentencing on federal conspiracy and possession charges and who testified as a defense witness, denied buying meth from Dauenhauer or getting meth from him for Sims.
During his own testimony, Dauenhauer said the cash came from carpentry and automotive jobs he did for people and from money he'd saved over the years. "I accumulated no quantity of drug money," he said.
Dauenhauer also said he'd take responsibility for the meth agents found in his house but that he didn't know where it came from. Selph, he said, would come to his house and give him meth samples to try.
Dauenhauer also said he modified his shotgun to fit in his camper and that it was on his couch because he was going to clean it.
Gazette reporter Zach Benoit contributed to this article.