Forfeiture Endangers American Rights

legislation and lobbying

Commentary on HR 1965

NOTE:    The analysis and commentary below was compiled by Forfeiture Endangers American Rights Inc.    This is not part of the text of the bill itself. 

The procedural 'reforms' of this bill take away
more due process than they add

U.S. House of Representatives, Bill HR 1965


F.E.A.R.'s analysis of the provisions in this section:

This section of the bill creates a new code section -- 18 U.S.C. § 983 -- which would apply to all civil forfeiture proceedings for offenses under title 18 (general criminal law), 21 (drug law) and 8 (immigration), of the U.S. Code.  This section pays lip service to reforms from the real forfeiture reform bill which FEAR backed -- HR 1835 -- but takes away the desirability of each of the reforms by creating exceptions that swallow the rule and/or conditions that make it so onerous to obtain the relief that it is not worth the price.

Section 983(a) and (b) change the procedures for administrative forfeiture. Administrative forfeiture is a process that makes the property owner jump through hoops in the seizing agency in order to obtain the right to have judicial hearings to contest the forfeiture. Under current law, if the property owner fails to file a claim and post a cost bond of 10% of the value of the property, within 20 - 30 days of receiving notice of forfeiture from the seizing agency, they lose the property without any court hearings at all. These rules apply to all forfeiture cases involving property worth less than half a million dollars. Ironically, there are no deadlines on the government under current law, other than the 5 year statute of limitations and a tiny exception for cars seized in simple possession drug cases.

Section 983(a)(1)(A)  would require the government to serve the administrative forfeiture notice within 60 days of seizure "to each party known to the seizing agency at the time of the seizure to have an ownership or possessory interest, including a lienholder's interest, in the seized article." If the agency discovers the identity of any new party who may own an interest in the property they would be required to serve them with notice within 60 days of discovering they may own an interest. But there are ways around this requirement -- built into the statute. Section 983(a)(1)(B)(2) allows the government to apply to a magistrate for an extension of time to serve notice, which "shall be granted based on a showing of good cause." There is no limit to the length of time nor number of times the government can obtain extensions of time. The only sanction the government would suffer from failing to provide notice within the 60 day limit is that they have to give the property back until they properly serve you with notice.  Big deal -- you get your property back and then they take it again once you are served with notice.  There is no incentive for the government to obey this deadline.

Section 983(a)(3) sets out procedures allowing a property owner who did not get notice, to move to set aside an administrative forfeiture on the grounds that he was not given notice and an opportunity to defend the case. But the motion must be made within 2 years after the seizure notice was published. If the person didn't get notice, how would they know when the notice was published?  To prevail on such a motion the propery owner must prove that (1) he had no actual notice of the seizure within enough time to file a timely claim  and (2) that the government failed to take reasonable steps to provide notice. If the property owner prevails, the government gets to start the forfeiture proceeding all over, even if their statute of limitations has run out. See Sec. 983(a)(6). Section 983(a)(7) takes away all other remedies that a property owner would have to contest an administrative forfeiture.

Under current case law interpreting the U.S. Constitution and the statute of limitations accrual rules, we get a better deal than this. The Supreme Court has held that a forfeiture obtained without the minimum notice requirements of the Due Process Clause is void. If the government did not provide constitutionally adequate notice -- and there are strict requirements defined in the statutes, rules and case law -- then you can move to set aside the default without having to show anything other than that the notice was invalid under the Due Process Clause. If the administrative forfeiture is declared void, then the government has to start over. And they may run into a statute of limitations problem -- which this section of the bill was obviously designed to get around. The government currently has 5 years after discovery of a forfeitable offense to institute forfeiture proceedings. The filing of a complaint in court tolls the statute of limitations, but that's not true of a legal notice published in a newspaper -- and not filed in court or served on the property owner. This statute would extend their statute of limitations indefinitely, by treating the publication of notice of forfeiture in a tiny ad in an obscure newspaper somewhere as enough to stop the statute of limitations from ever running, even if you were never served with notice or given the opportunity to defend your forfeiture case! And this bill purports to cut off existing remedies under case law interpreting the Constitution!

Section 983(c) through 983(m) apply to civil judicial forfeiture proceedings. Under current law, if you're lucky enough to make it through the administrative forfeiture process, you are served with a civil forfeiture complaint that has been filed in a federal district court. You have 10 days to file a "verified claim" -- a requirement not found in any other type of federal civil case, and 20 days to file an "Answer". You have no right to court appointed counsel. The burden of proof on the government, under current law, is a mere "probable cause" -- just a tad more than "mere suspicion". That's their burden of proof at trial. And then the burden of proof shifts to the property owner to prove his innocence and his property's innocence.

Section 983(c) creates a new requirement that the government file a forfeiture complaint in court within 90 days after the property owner files a claim with the seizing agency. That's a modest improvement over present law, which sets no statutory limits on the amount of time the government can delay judicial proceedings after seizing property. This is one of the few sections in this bill that is not offensive.

Section 983(d) allows the court to appoint counsel to represent indigent property owners. But this worthy concept is bastardized in this bill. The court decides whether or not to appoint counsel after considering the following factors: (1) the value of the property (at what point is your property not worth enough for the court to appoint counsel to defend it?); (2) how badly the person needs it (does the government need it more than you?); and (3) whether the person's case is meritorious (so the judge prejudges your case before giving you a lawyer to present your case?) Even worse, the court makes these decisions after a hearing in which the government is permitted to put the property owner on the stand and question him/her -- without the benefit of counsel! The person's testimony can be used against them, this bill says, under the rules that apply to testimony at suppression motions.

Section 983(e) puts the burden of proof on the government, but only by a preponderance of the evidence. Under current law, the burden of proof on the government is probable cause (the same flimsy standard used to get a search warrant -- just a tad more than a "reasonable suspicion"), and then the burden shifts to the property owner to prove a defense by the preponderance of the evidence. Preponderance means "more likely than not" -- or in other words, 51%. In effect, this bill is just shifting the burden by 2% -- from 51% burden on the property owner/49% on government to 49% citizen/51% government. Big deal. In criminal cases, the burden of proof on the government is "beyond a reasonable doubt" -- somewhere in the neighborhood of 95%-99%. Since the government is trying to punish criminal behavior -- why shouldn't forfeiture cases have the same burden of proof as criminal cases?

Section 983(f) creates an across-the-board innocent owner defense that applies to all forfeitures under U.S. Code titles 18 (general criminal code), 21 (drug offenses) and 8 (immigration). Because it is a newer statute, it would override the patchwork of innocent owner defenses set out in various forfeiture statutes, and it would apply to statutes which previously omitted an innocent owner defense. The Supreme Court held last year in Bennis v. Michigan that if a statute does not have an innocent owner defense, then innocence is irrelevant, and the Constitution implies no remedy for the hapless property owner. This section would create an innocent owner defense in the small class of forfeiture cases where the statute failed to provide an innocent owner defense. But for most people whose property was seized under post-1984 forfeiture statutes (which constitute the vast majority of current forfeiture cases, since most of the forfeiture laws have been added in the past 13 years), current law has a far better innocent owner defense than this bill would allow.

Under this bill, to qualify as an "innocent owner," the property owner must prove he/she either "did not know of the conduct giving rise to forfeiture" or "upon learning of the conduct giving rise to the forfeiture, did all that reasonably could be expected under the circumstances to terminate such use of the property." Section 983(f)(5) creates a rebuttable presumption that you are an innocent owner if you (A) promptly notify the police that "conduct giving rise to a forfeiture would occur or has occurred" involving your property and (B) take "reasonable steps in consultation with a law enforcement agency to discourage or prevent the illegal use of the property." This sounds like the innocent property owner is required to cooperate as an informant in order to qualify for an innocent owner defense. And it's still just a rebuttable presumption. The government is given leeway to argue that you're not an innocent owner even if you do everything they ask!

This portion of the bill says the property owner is not required to take extraordinary steps that he/she reasonably believes would be likely to subject him/her to physical danger -- but a lot turns on the interpretation of the term "reasonably believes." Fear of retaliation is very subjective. This section applies only an objective "reasonable person" test. All property owners are in the same boat here -- they have to police their property, taking "all the steps a reasonable person would take in the circumstances" even if they are old and feeble, handicapped, or financially unable to take those steps.

Section 983(f)(3) cuts off all rights to an innocent owner defense for people who acquired their interest in the property after the illegal act which triggered the forfeiture (even if it was discovered for the first time years later), unless the person was a bona fide purchaser for value, who, at the time of purchase, was "reasonably without cause to believe that the property was subject to forfeiture."

Section 983(h) allows the government to use hearsay -- "otherwise inadmissible under the Federal Rules of Evidence" -- in any pretrial proceeding in which the standard is probable cause.

Section 983(k) makes the "excessive fines" (or proportionality) defense a non-jury issue to be decided by the judge after the trial.

Section 983(l) exempts the government from having to establish the forfeitability of the property prior to completion of discovery. Armed with this section, the government won't need to have grounds to forfeit property before they seize it. This legitimizes their growing practice of seizing first and asking questions later. This little section may be the most dangerous of the whole bill.

SECTION 2(d) of this bill creates another new code section -- Section 985 -- governing release of property to avoid hardship. Here again a laudable goal is bastardized in this bill. In order to obtain release of the property, the property owner has to convince the court of ALL of these things: (1) he has standing and his claim is not frivolous; (2) he has enough ties to the community to trust him to protect his own property and surrender it to the government if he loses; (3) letting the government hold the property pending trial "will cause substantial hardship to the claimant, such as preventing the claimant from working, leaving the claimant homeless, or preventing the functioning of a business;" (4) the hardship to the property owner outweighs the risk the property will be lost, removed or diminished in value; and (5) that the property is not currency or monetary instruments (with an exception for assets of a business which has been seized), or evidence, and it not specificially designed or especially suited for illegal activities; and that the property is not likely to be used to commit further crimes if returned to the owner.

The property owner has to prove all of those things before getting his property released pending trial. Few property owners will qualify under these impossible standards. Ironically, the government can seize proeprty and can't be required to show it has grounds to seize it until discovery is completed under Section 983(l), but the owner has to show a meritorious case in order to get his property back pending trial!

These provisions are obnoxious.  They are worse than current law, and we should not accept them as "forfeiture reform."