Court News
Last update November 26, 2007, by Judy Osburn
This section of the website contains news stories highlighting important court decisions dealing with asset forfeiture and related issues.  The actual opinions for these cases may sometimes be found in the FEAR website's Law Library, or by clicking the opinion link in the story.

U.S. 2nd Circuit Court of Appeals:
US v. Capoccia, No. 06-0669
Very thoughtful decision on the required nexus between the crime of conviction and the conduct of conviction.

Congratulations to attorney Jody Neal-Post on this important victory in which the Tenth Circuit Court of Appeals joins five other Circuits holding that government may not restrain “substitute assets” prior to a criminal conviction and order of forfeiture!  Jody serves as Secretary on FEAR’s Board of Directors, and frequently contributes to FEAR-List Bulletins, as well as FEAR’s Brief Bank II.

August 28, 2007:
 10th Circuit rules “substitute assets” are not subject to pre-trial restraint:
Government may not use lis pendens statute for pre-trial restraint of property that neither comprises the fruits of, nor is connected to, the defendant’s alleged crime.
by Judy Osburn

The indictment accusing Dana Jarvis and twenty other co-defendants of conspiracy to distribute 1000 kilograms of marijuana and related money laundering and continuing criminal enterprise charges also contained a criminal forfeiture allegation stating that, upon conviction of one or more of the offenses, all defendants would be jointly and severally liable for a money judgment of $158.4 million.

The indictment listed bank accounts, several parcels of real property, vehicles, seized currency and a liquor license as “forfeitable property” connected to the defendants’ criminal conduct. The indictment also listed two pieces of real property (purchased by Mr. Jarvis before the alleged conspiracy ever took place) among the “substitute assets” to be forfeited in the event other property connected to, or derived from, the alleged drug crimes could not be located.1 

While 21 U.S.C. § 853(e) allows the United States to seek a restraining order or injunction to preserve the availability of property the government alleges to be subject to criminal forfeiture in the event of a conviction, the section does not explicitly provide for pre-trial restraint of § 853(p) substitute property. Rather than attempting to use the criminal forfeiture statute to seek a federal protective order on Jarvis’ two properties, the United States recorded notices of lis pendens – a common practice to notify potential buyers or lenders about pending litigation contesting title to real property.

The notices of lis pendens included the language, “the property located in Mora County, New Mexico, was criminally indicted in this case and the United States is seeking the forfeiture of all that lot or parcel of land, together with its buildings, appurtenances, improvements, fixtures, attachments, and easements thereon.”

In January 2006 Jarvis moved the district court to release the two Mora County properties, contending that no legal basis existed for the restraint of substitute assets without a conviction and forfeiture order. The United States’ restraint of the two properties (neither of which had any connection to criminal activity) prevented Jarvis from hiring the counsel of his choice and deprived him of his Sixth Amendment right. Therefore, Jarvis argued, a due process hearing was required before the United States could effectively freeze these assets.

The government responded by arguing that “a lis pendens is not a legal restraint, but merely functions as constructive notice to prospective purchasers,” and that even if a lis pendens were a restraint, the United States may restrain substitute assets that have no connection with an alleged crime “in light of the guidance in § 853(o) that the criminal forfeiture statute be liberally construed to effect its objectives.” 

The district court bought into the governments’ arguments, concluding that filing a lis pendens does not constitute a restraint of property within the meaning of § 853.  Defying the logical consequences of a public notice that title to real property is pending litigation and the owner may be in the process of losing his right to own, sell or borrow against that property, the lower court determined that a lis pendens did not interfere with any legal incidents of property ownership such as “the right of sale” and unrestricted use and enjoyment.

Therefore, the lower court held that a lis pendens “did not constitute a property deprivation triggering due process concerns.” It also rejected Jarvis’ argument that substitute assets, which by nature never had any connection with, nor could be traceable to criminal activity, are not subject to restraint prior to a criminal conviction and order of forfeiture.

Jarvis moved the court to reconsider, pointing out the distinction between forfeitable property under § 853(a), which may be restrained pending criminal trial, and substitute property under § 853(p), for which Congress did not specify pre-trial restraint powers for the government. He further argued that New Mexico law specifically classifies a lis pendens as a restraint, which cannot apply to substitute property until a court has issued an order of forfeiture and the government is unable to satisfy the order with property forfeitable under § 853(a).

After an August 2006 evidentiary hearing, which included testimony by a realtor on the ill-effect of a lis pendens notice on a seller’s practical ability to sell or borrow against his land, the lower court rejected the motion for reconsideration with a single sentence, concluding that Jarvis had not presented any new arguments for release of his funds.

On September 1, 2006, the court appointed Jody Neal-Post as Jarvis’ forfeiture counsel. On interlocutory appeal Ms. Neal-Post raised the argument that government may not use a notice of lis pendens to restrain property in an in personam criminal forfeiture action where the real property itself is not the subject of litigation. Because the issue before the appellate court was “purely legal in nature and the relevant statutory language and case law dictate a certain result,” the appeals panel determined this is one of the unusual cases in which it is proper for the appeals court to decide an issue that had not been presented to the lower court.

After both parties fully briefed and argued this issue to the appeals court, the panel determined that existing case law provided a certainty of proper resolution.  The Tenth Circuit concluded in a published opinion, filed August 28, that to be eligible to file a lis pendens notice, “the party recording the notice must assert a present claim to the property’s title or have some other present interest in the subject property.” Circuit Judge Murphy wrote for the panel that a lis pendens notice is intended to preserve property rights in existence at the time litigation commences, but does not create new or additional property rights. Additionally, under New Mexico law, a lis pendens cannot be filed in “anticipation of a money judgment.”

Assets “constituting, or derived from, any proceeds” of the defendant’s criminal action and property “used, or intended to be used” in the commission of facilitation of the defendant’s criminal action “shall” be forfeited upon conviction. By virtue of the statute’s relation-back provision, the United States obtains a vested “right, title, and interest” in such tainted § 853(a) property superior to that of third parties “upon the commissions of the act giving rise to forfeiture.” The government, furthermore, has the ability to seek a protective order to restrain tainted assets prior to trial in order to ensure the availability of the tainted property in the event of the defendant’s conviction.

In contrast, the statute treats the United States’ interest in substitute property – property that neither comprises the fruits of nor is connected to the defendant’s alleged crime–differently than it treats the government’s interest in § 853(a) tainted property. Pursuant to § 853(p), the forfeiture of substitute property cannot occur until after the defendant’s conviction and a determination by the trial court that the defendant’s act or omission resulted in the court’s inability to reach § 853(a) assets. Both the relation-back and protective order provisions of § 853 are silent as to § 853(p) substitute property. Unlike the pre-conviction interest the government may claim in tainted § 853(a) property, § 853(c) thus does not explicitly authorize the United States to claim any pre-conviction right, title, or interest in § 853(p) substitute property.2  Furthermore, all but one federal court of appeals to address the issue has determined the legislative silence regarding substitute property in § 853(e) precludes pre-conviction restraint of substitute property.3 The statute, therefore, imposes specific preconditions on the government’s ability to claim title to the defendant’s substitute property, preconditions which can only be satisfied once the defendant has been convicted.4

The Tenth Circuit Court of Appeals joins the Second, Third, Fifth, Eighth and Ninth Circuits in holding that substitute assets are not subject to pre-trial restraint. The Fourth Circuit is the only federal court of appeals to conclude that § 853 permits pre-trial restraint of substitute assets.
(Click here to read Endnotes.)

2nd Circuit denies fees for attorneys who recovered money seized from multiple innocent claimants under USA PATRIOT Act

According to this opinion the government may avoid paying attorney fees incurred by an innocent owner simply by seizing property owned by multiple innocent owners.

On August 10, 2007, the Second U.S. Circuit Court of Appeals ruled that CAFRA (Civil Asset Forfeiture Reform Act of 2000) exempts the government from liability for fees when seized currency is subject to “competing claims” of multiple innocent claimants who substantially prevail in a forfeiture case.  The appeals panel also held that CAFRA now provides the exclusive means of awarding fees to forfeiture defense attorneys, and therefore fees incurred defending a forfeiture case can no longer be awarded under EAJA (Equal Access to Justice Act).  While “mindful” that defense attorneys in U.S. v. $293,316 in United States Currency, 05-6522-cv, invested considerable time in helping nearly eighty innocent claimants recover their money, the panel nonetheless ruled that “under CAFRA those facts cannot justify the imposition of another burden on the public fisc.” 

Nearly eighty Pakistanis wished to transfer several thousand dollars from New York to Pakistan and entrusted their funds to three couriers on what they believed would be an overnight flight. The three couriers were also carrying some of their own money when they were apprehended as they were about to board a flight to Pakistan in September 2002, and were subsequently convicted under the bulk cash smuggling provision of the USA PATRIOT Act.

The Pakistanis who had entrusted their funds to the three couriers had violated no law. The appeals court recognized that “that many aliens use couriers to deliver money to friends and relatives because the couriers speak their language, charge no fees, and serve areas remote from the nearest Western Union branch.”  

After three years of litigation the government returned the seized funds to the innocent claimants.  The US District Court of the Eastern District of New York also concluded that only 50% of the funds owned by the convicted couriers could be forfeited to the government without violating the Excessive Fines Clause of the Eighth Amendment. 

Attorneys David B. Smith and John P. Donohue represented many of the innocent claimants as well as two of the three convicted couriers.  The two attorneys sought fees in an amount of $157,888 for their work representing claimants during the three years it took to recover the funds. However, the district court denied the attorney fee request because it determined there were "competing claims" to the same property within the meaning of CAFRA’s 28 U.S.C. § 2465(b)(2)(ii).  The district judge also denied an alternative award of fees under the Equal Access to Justice Act.  

The Second Circuit affirmed, (click here to continue)
Congratulations to attorney Steven Kessler, for this appeals court victory!
Steven frequently contributes pleadings to FEAR's Brief Bank II, where his Brief to the Second Circuit in U.S. v. $660,200 is available along with the Government’s Brief .

July 2, 2007:
Second Circuit orders government to honor settlement agreement.    
by Judy Osburn
Assistant U.S. Attorney Tracey Knuckles resigned in the midst of arranging for return of fifty percent of $660,200 in seized currency pursuant to an in-court settlement agreement. At the same time the government suddenly attempted to renege on its settlement agreement, painting a picture of fear with unsubstantiated assertions that claimants intended to use the money to fund terrorism. The government also claimed that AUSA Knuckles had no authority to enter the government into a binding settlement agreement – at least not where the government later cries “terrorism case!”

 “Settlement agreements are contracts” stated the Second Circuit Court of Appeals on July 2, 2007, affirming the district court’s order enforcing the settlement agreement in United States v. $660,200. The appellate court agreed with the district court’s finding that Assistant U.S. Attorney Tracey Knuckles and her supervisor (who was transferred on or about the same time that Ms. Knuckles resigned) had actual and apparent authority to enter into the in-court settlement.1

Arguing that it should be allowed to renege on its settlement agreement, the government had contended that it should not have to comply with the law and rules where it alleges threats to “national security.”2  Claimant Sami Khalil’s attorney, Steven Kessler, opened his summary argument to the Second Circuit:

With Old Glory waving behind it, appellant [Government] asserts, in the very first paragraph of its Preliminary Statement, that this is a terrorism case. Appellant uses appropriate catchwords and attempts to paint a picture of fear around appellee and the defendant funds. However, once the arguments begin and the facts of the settlement and the court’s decisions below unfold, appellant’s arguments for reversal of the district court’s orders have little, if anything, to do with terrorism.

Kessler’s client, claimant Sami Khalil, had never been charged with any crime related to the civil forfeiture proceeding. The only charges filed against anyone in relation to the seized currency were for failure to report currency carried while attempting to board a commercial flight to Egypt–not terrorism.  ... (Continued)

Congratulations to plaintiff's attorney and FEAR member Joseph P. Kennedy on this important victory!

April 26, 2007:
New Mexico Court of appeals rules that police cannot use federal courts to bypass state forfeiture reforms
by Judy Osburn  

In George Albin versus Bakas, Taylor, Danko, Maldandado, Hooper and O’Leary (New Mexico state police and their superiors), Case number 26,134 filed April 26, 2007, the Court of Appeals for the State of New Mexico examined whether state police officers who seize cash under the authority of New Mexico’s Controlled Substances Act are required to comply with the requirements of the state Forfeiture Act, or whether they may instead transfer the cash to the federal government to bring a forfeiture action under federal law, then receive from the federal government a portion of the proceeds.  

In a tremendous victory for compelling police agencies to abide by state forfeiture reform laws, the appeals court ruled: "Just because the officers subsequently decided to transfer the cash to the federal government for the purpose of bringing a federal forfeiture action did not entitle them to ignore New Mexico law.”  Plaintiff George Albin is represented by Joseph P. Kennedy of the law firm Kennedy & Oliver, P.C., Albequerue.  Joseph Kennedy is also amember of FEAR and contributes pleadings to FEAR's Brief Bank II.

 
Agencies in various states that have passed forfeiture reform legislation often use his type of federal “adoption” of forfeiture cases to avoid the requirements of state reforms. The Albin court held that New Mexico State Police officers seizing currency under state law are subject to the procedures set forth in New Mexico's Forfeiture Act, and in this case, the officers violated that Act. Therefore the court reversed the summary judgment for Defendant state police by the District Court of Santa Fe County, and remanded for further proceedings.

When New Mexico State Senator Duncan Scott (R-Albuquerque) introduced legislation in 1994 to "overhaul New Mexico's criminal asset forfeiture law," he said the major change requires that forfeited funds or property go to the state general fund rather than allow agencies to keep what they seize.  The law existing at that time “perverts law enforcement incentives," Scott said. "Police become more interested in chasing Mercedes rather than chasing violent criminals because they get to keep the flashy car. Our Founding Fathers wisely envisioned three separate branches of government, and the existing forfeiture law allows law enforcement agencies to become both the tax collector and legislature for themselves." 

New Mexico forfeiture law now requires: 1) a criminal conviction of the owner before property may be forfeited; 2) the value of the property to be forfeited must not unreasonably exceed the financial gain derived from, or loss caused by, the related crime; and 3) that proceeds of forfeited property beyond costs of storage and restitution to victims be deposited in the general fund to be used for drug treatment, education and substance abuse prevention.   

However, under federal law police agencies that transfer seized property for “adoption” by federal courts have continued to enjoy up to 80% of the proceeds returned directly to the seizing agencies.  The court of appeals held in Albin that procedural requirements of New Mexico’s Forfeiture Act are mandatory, stating:

We acknowledge that the use of “adoptive seizures” is apparently wide-spread and follows a long history of forfeiture collaboration between state and federal agencies. We do not address whether, to what extent, or how an “adoptive seizure” to allow a federal forfeiture to proceed may be accomplished under the Forfeiture Act. Our holding in this case is limited: when property is seized by state police officers for forfeiture, compliance with the Forfeiture Act is required even if the state intends to transfer the property to the federal government to pursue a federal forfeiture action pursuant to an “adoptive seizure.” In this case, Defendants violated the Forfeiture Act.

The case began in during a traffic stop ...(continued)
February 9, 2007:
"Contraband Confiscation Agreement" circumstances ruled unconstitutional violation of due process: judge orders Bradenton police to return $10,200 or use court system to file forfeiture proceedings. 
Bradenton Police Department continues policy of bypassing court system by coercing victims into signing forfeiture contract waiving right to day in court.
by Judy Osburn   

Each year police in Bradenton, Florida side-step judicial oversight provided in Florida's Contraband Confiscation Act by intimidating hundreds of people into signing roadside agreements to give up property such as cash and cars and waive all rights to contest the confiscation in court.  "Imagine having to choose between signing over your cash or going to jail," Tampa Bay defense attorney Denis DeVlaming said earlier this year. "That's the situation that these people face. It's a scary proposition."

Twenty-year-old Delane Johnson was not arrested when he consented to a search outside his apartment in July, 2006, and police coerced him into handing over $10,200 and signing Bradenton's Contraband Confiscation Agreement.  On February 9, 2007, state Circuit Judge Peter Dubensky rejected the city of Bradenton's motion to dismiss Johnson's legal challenge of the waiver agreement, and ordered police to either return Johnson's cash or file suit for forfeiture against the money in state court.  The court determined that the contract signed by Johnson "and the circumstances surrounding the making of the contract fail to comply with even the rudimentary elements of due process."

Though his ruling applies only to Johnson's case, the judge wrote a scathing criticism of Bradenton's waiver agreement policy: "Taken to its logical extreme," Dubensky wrote, the police "could present this agreement to any citizen stopped for any reason and request forfeiture of any item of property" in exchange for signing the document. The judge continued, "It is not remotely conceivable that the citizenry would countenance such a state of affairs."

Bradenton police spokesman stated the his department had not yet decided whether to return Johnson's money to him or file suit for forfeiture.  However, the department stands little chance of prevailing in a state forfeiture proceeding, as the statutory deadline for filing a notice of intent to forfeit under Florida law passed last October.

Attorney Varinia Van Ness, co-counsel for Johnson, questioned the impact Dubensky's favorable ruling will have on the police department, stating, "I'm hoping they will no longer use these agreements to take people's property." But if the department continues to go by its policy rather than state laws she may file a motion to reconsider the future of the department's policy. "I would hope they would start obeying the law of the land, so, in the future, this doesn't happen to other people," she said.

Continued: "Judge's ruling regarding these contracts has had little effect, if any, on the manner in which the Bradenton Police Department takes people's property and twists the law!" 


June 30, 2006:
Louisiana forfeiture trap case reversed on appeal    by Brenda Grantland

Louisiana forfeiture defense lawyer Paul Lemke scored a recent victory in the Louisiana state courts in a highway forfeiture trap case.  Now that the Louisiana Supreme Court has denied review, the ruling is final.

In State v. $107,156, an officer stopped a car on the interstate highway because it had a temporary tag. When the car's occupants acted nervous, they ran criminal record searches and found out both occupants had felony records.  Then the police brought in a drug sniffing dog which alerted to the car.  They searched the car and found $107,156 in cash.

The district court forfeited the cash, despite the claimant's evidence of legitimate income, and the lack of evidence of any crime.  The court also denied their motion to dismiss for undue delay (and for the government missing a statutory deadline in bringing the case to trial). The appellate court reversed on the merits, holding that the facts as presented by the government did not support forfeiture by a preponderance of the evidence.  Judge Stewart concurred in the result, but dissented on the denial of the claimant's motion to dismiss for undue delay, pointing out that the statute set a deadline and the government missed it.

Paul Lemke commented on his victory:

"The state moved for writs to the Louisiana Supreme Sourt and argued that hideous case from the 8th circuit (United States of America v. $124,700 in U.S. Currency, 05-3295 (8th Cir. 2006 ) (Carrying cash while driving a rental car ruled grounds for forfeiture) to apply to this case. The Louisiana Supreme Court denied writs on November 22, 2006 so this is now a final judgment, not a major win by any means but at least Louisiana Appeal courts are looking better."

Congratulations, Paul!

2004

Must government return seized property it fails to forfeit? - The consolidated cases of U.S. v. Clymore and U.S. v. Aguirre pending in the Tenth Circuit (Denver) will decide that issue. FEAR Foundation Journal, vol. 1 no. 1 (Fall 2003).  Some of the appellate briefs from these cases are in the FEAR Brief Bank, accessible to FEAR members with passwords.

NEW JERSEY: Scott Bullock's brief and the trial court opinion are now on FEAR website, March 29, 2004 FEAR-List Bulletin

NJ: Oral argument in Scott Bullock's challenge to forfeiture law to occur on 3/31/04 , March 26, 2004, Institute for Justice press release

FEAR: Announcing new FEAR-List feature: "Important Forfeiture Decisions,"  March 25, 2004 FEAR-List Bulletin

FEAR: Important Forfeiture Opinion: U.S. v. Bearden (8th Cir. 2003) - standing/ownership, March 25, 2004 FEAR-List Bulletin

FEAR: Important Forfeiture Decision: U.S. v. Pease (11th Cir. 2003) - criminal forfeiture & sentencing, March 25, 2004 FEAR-List Bulletin

CALIFORNIA:  FEAR Board member Mark Clausen wins second major ruling against Cal. forfeiture ordinances!, March 19, 2004 FEAR-List Bulletin

NEW MEXICO:  Albuquerque Journal Opinion page mentions Jody Neal-Post's case, March 15, 2004 FEAR-List Bulletin

NEW MEXICO: "Man, Never Charged, Sues To Get Money Seized by Cops,"  March 10, 2004 FEAR-List Bulletin, with clipping from an Albuquerque Journal article discusses Jody Neal-Post's constitutional challenge to Albuquerque Police Department's practice of seizing property and keeping it without complying with forfeiture procedures.

2003

Nassau County Judge Invites Challenges Pursuant to Krimstock - FEAR Foundation Journal, vol. 1 no. 1 (Fall 2003).

11th Circuit reverses $242,484 civil forfeiture, draws probable cause line - Drug dog alerts are not enough, standing alone, to forfeit cash seized at highway forfeiture traps, the conservative 11th Circuit holds -- applying the pre-CAFRA  burdens of proof, where all the government had to show was a mere probable cause!  FEAR Foundation Journal, vol. 1 no. 1 (Fall 2003).

SUPREME COURT:  "Justices side with cops in drug arrests," December 16, 2003, Salt Lake City Tribune article about the Supreme Court decision Maryland v. Pringle, 538 U.S. 921 (2003), holding the cops can arrest everyone in a car if contraband is found and none of the passengers accepts responsibility for it.

NY:  Nassau's Drunk Driving Seizure Law Too Broad, November 24, 2003 FEAR-L:ist Bulletin

MISSOURI:  State of Missouri ex rel. Missouri State Highway Patrol, November 20, 2003 FEAR-L:ist Bulletin

FLORIDA:  Judge rules authorities wrong to seize truck, November 18, 2003, link to article

PENNSYLVANIA:  "High court: Washington County, Penn., District Attorney Pettit has to pay,"  November 1, 2003 FEAR-L:ist Bulletin

NEW MEXICO:  "Navajo Nation judge holds tribal government in contempt,"  October 27, 2003 FEAR-L:ist Bulletin

NEW YORK:  "New York Supreme Court to decide on car seizure policy,"  October 14, 2003 FEAR-L:ist Bulletin

PENNSYLVANIA:  "High court: Washington County, Penn., District Attorney Pettit has to pay,"  October 8, 2003 FEAR-L:ist Bulletin

ARIZONA:  "Judges rule in favor of Mesa brake shop,"  October 7, 2003 FEAR-L:ist Bulletin

NEW YORK:  "No-knock cops sued for $21 million,"  September 11, 2003 FEAR-L:ist Bulletin

CONNECTICUT:  Pre-Civil Asset Forfeiture Reform Act burdens of proof do not violate due process, August 19, 2003 FEAR-L:ist Bulletin

FLORIDA:  "Rehearing Rejected on Groundless Cash Seizure,"  July 3, 2003 FEAR-L:ist Bulletin

NEW YORK:  "Vehicle Forfeiture Laws Challenged,"  June 9, 2003 FEAR-L:ist Bulletin

TEXAS:  "Drug dealer ordered to return lottery winnings,"  June 8, 2003 FEAR-L:ist Bulletin

NEW YORK:  "Richard Scrushy, Still Uncharged, Is Unfrozen,"  May 10, 2003 FEAR-L:ist Bulletin

Supreme Court to Review Police Arrest Powers, March 29, 2003 FEAR-L:ist Bulletin, with link to article

NORTH CAROLINA:  "A drug terrorist convicted!,"  March 3, 2003 FEAR-L:ist Bulletin

3rd Circuit:  U.S. v. Thomas, February 17, 2003 FEAR-L:ist Bulletin

OREGON:  Law Enforcement lobby asks court to overturn forfeiture reform initiative, February 4, 2003 FEAR-L:ist Bulletin

NEW JERSEY:  State files request for stay in N.J. v. 1990 Ford Thunderbird, January 15, 2003 FEAR-L:ist Bulletin

CALIFORNIA:  "Suit calls auto seizures unfair,"  January 13, 2003 FEAR-L:ist Bulletin

NORTH DAKOTA:  FARM FRAUD: Huber guilty - must forfeit $5.9 million, January 10, 2003 FEAR-L:ist Bulletin

NEW YORK:  "Challenges Are Invited to DWI Forfeiture,"  January 8, 2003 FEAR-L:ist Bulletin

2002

Krimstock v. Kelly - Second Circuit holds NYC forfeiture statute unconstitutional for failing to provide a prompt post-seizure probable cause hearing. FEAR Foundation Journal, vol. 1 no. 1 (Fall 2003)

New Jersey 1990 Ford Thunderbird - FEAR Board member Scott Bullock's groundbreaking victory, in which the trial court held it violates Due Process for forfeiture prosecutors to profit from their forfeitures.  FEAR Foundation Journal, vol. 1 no. 1 (Fall 2003).

FISA: Secret tribunal expands surveillance powers - FEAR Foundation Journal, vol. 1 no. 1 (Fall 2003).

New Jersey’s method of financing police and prosecutors through civil forfeiture is unconstitutional, Superior Court Judge G. Thomas Bowen of Salem County has ruled.

2001
In United States v. Carrell (No. 99-14481), May 29, 2001, the Eleventh Circuit court reverses and remands an in rem forfeiture case. "This appeal requires us to determine whether the statute of limitations had expired before the government brought a civil in rem forfeiture action on properties procured with proceeds from drug transactions. The district judge decided that the government should have known earlier that the properties, titled in the names of the drug offender's ex-wife and son, were purchased with drug money and dismissed the case with prejudice. We REVERSE and REMAND."

1998
The Eleventh Circuit in "UNITED STATES of America, Plaintiff-Appellee, v. LAND, WINSTON COUNTY, Certain Real Property Located near Highway 195, Winston County, Alabama, together with all improvements, fixtures and appurtenances thereon" decided that "that the government met its probable cause burden in the forfeiture action. However, we find that Woods did not receive proper notice of the forfeiture." The case was remanded back to the District Court. (Dec. 31, 1998)

On December 8, the U.S. Supreme Court unanimously held that police may not conduct a full-blown search of automobiles stopped for routine traffic violations,  in Knowles v. Iowa.   Although Iowa was the only state which had passed legislation purporting to allow such searches, other localities, such as Volusia County, Florida, and Sulphur, Louisiana have used traffic stops to search cars for cash, which they seized and tried to forfeit.  This ruling may help put a stop to those forfeiture traps.

U.S. Supreme Court hears oral argument on a seizure case - On November 5, the Supreme Court heard oral arguments in  City of West Covina v. Perkins (S.Ct. No. 97-1230).  This is a civil rights action (under 42 U.S.C. §1983), brought by a couple from Southern California whose house was broken into and searched by police executing a search warrant for a person who no longer lived there.  The Perkins were not home at the time.  The West Covina police seized $2,469 during the search.  Instead of telling the Perkins what procedures were available to them to seek the return of their money through the court system, the police gave them the runaround.  (Sound familiar?)  The Perkins filed suit under §1983 claiming a violation of their right to due process.  The district court dismissed their suit, but the Ninth Circuit reversed, holding that due process requires the government to give notice to the owners of seized property of the procedures that are available to get it back.   Read the Ninth Circuit's opinion and the FEAR-List bulletin for more details.  If you were the victim of a similar runaround please send your story to the FEAR victim support committee.

"Court to Review Vehicle Searches,"  FEAR-List Bulletin posted by Mike Gogulski, 3/27/98

New Jersey Supreme Court to Hear Forfeiture Argument, FEAR-List Bulletin posted by John Paff, 3/17/98

"Woman awarded $450,000 after strip search", posted to FEAR-List by Leon Felkins, 2-26-98

NJ Supreme Court to Hear Forfeiture/Jury Argument, posted to FEAR-List by John Paff, 2-25-98

$2 million in attorneys fees seized in R.I., summary of two newspaper clippings: "Lawyers for money launder ordered to turn over fees" and "U.S. Attorney collects $4.4 million in fiscal year,"  Providence (R.I.) Journal, January 28, 1998; FEAR-List bulletin posted by Brenda Grantland 1/28/98.

$468,000 returned in DeBartolo fraud investigation, summary of newsclipping "Seized Money Returned in DeBartolo Sting:
Prosecutors Didn't Want to Reveal Case," by David Dietz, San Francisco Chronicle, January 24, 1998, p. A6, posted to FEAR-List by Brenda Grantland 1/24/98.

Discussion of Fourth Circuit decision on double jeopardy and drug taxes: Lynn v. West, posted to FEAR-List by Brenda Grantland & Susan Wells, 1/22/98.

"Fourth Circuit holds North Carolina's drug tax is a criminal penalty for double jeopardy purposes", posted to FEAR-List by Matt Elrod, 1/22/98, forwarded from Darryl Brown, University of Dayton.


1997
On May 27, 1997, the U.S. Supreme Court granted certiorari in United States v. Bajakajian, Supreme Court No. 96-1487, opinion below 84 F.3d 384 (9th Cir. 1996), a Ninth Circuit decision holding that the forfeiture of cash for a cash transaction reporting requirement violation would be unconstitutionally disproportionate. Update: Mr. Bajakajian took his case to the U.S. Supreme court and received a historical decision in his favor. For a complete time line of this case, go to James E. Blatt's "Time Line of Events: United States v. Bajakajian". Mr. Blatt successfully defended Mr. Bajakajian.

On December 10, 1997, the Supreme Court decided the civil penalty in Hudson v. United States, S.Ct. #96-976, did not trigger double jeopardy protection.  Chief Justice William H. Rehnquist, writing for the 5 to 4 majority, held that "only the clearest proof" should be allowed to show that a civil remedy is really a criminal punishment for double jeopardy purposes. Read Vin Suprynowicz's analysis of this case.  Decision below: U.S. v. Hudson, 92 F.3d 1026 (10th Cir. 1996). Note: the Supreme Court decided in 1996 that civil forfeiture was not punishment for purposes of the double jeopardy clause -- see United States v. Ursery below.

News from other courts in 1997:

Drug Conviction of man, 78, Overturned by Appeals Court, by Jeff Kramer, The Orange County Register (October 3, 1997) (Michael Patrick Marvich, now 82, overturned his conviction for drugs he says belonged to his roommate by challenging the illegal search.  Living in a trailer after losing his house to forfeiture, he's now seeking reimbursement for his forfeited home, worth $400,000.)

1996
The 1996 crop of Supreme Court forfeiture decisions was disappointing, to say the least. Their implications are very scary -- he right to own private property, it now seems, has this huge exception -- unless the government seizes it under a forfeiture statute. Then all your rights vanish, it seems. If you think we exaggerate, read the opinions and decide for yourself.

$405K/Ursery was a nightmare!

We lost the double jeopardy issue in the Supreme Court. On June 24, 1996, the Supreme Court decided, in the combined cases of United States v. Ursery and United States v. $405,089.23, that civil forfeiture was not punishment for purposes of the Double Jeopardy clause of the Fifth Amendment to the Constitution. The decision was 8-1 in Ursery, with Justice Stephens dissenting, and 9-0 in $405K.

It was a devastating blow. FEAR's Double Jeopardy team had put years into this effort. Three FEAR activists devoted a lot of their time, without pay, handling the case in the U.S. Supreme Court. FEAR's Washington state coordinator, Jeffrey Steinborn, and California coordinator, Shawn Perez, cocounselled the case for defendant James Wren. Our good friend Jeffry Finer, led the team and argued the case before the Supreme Court. They all did a fabulous job. The case was not lost because of anything they did or didn't do, but because of politics. The Court simply didn't want to let a lot of people out of prison or force the government to return a billion or so in ill-gotten gains. It looked like we were going to win for a while there. We had a large percentage of the country agreeing with us -- as it should be -- since, in Truth and Justice, we were right. The government, under our Constitution, should not be allowed to prosecute and punish people over and over again for the same offense. But the Supreme Court disagreed. See our Special $405K page for our archive on the Double Jeopardy issue.

The Supreme Court's decision in Bennis v. Michigan provoked scattered outrage among the silent majority, but apathy soon set in

On March 4, 1996, the U.S. Supreme Court handed down its decision in Bennis v. Michigan, the case involving the wife whose 1/2 interest in the family car was forfeited because her husband used the car to solicit a prostitute. The Supreme Court held that the Constitution does not protect truly innocent citizens from having their property forfeited. If the statute does not have an innocent owner defense, the majority said, your innocence is irrelevant. Most modern forfeiture statutes contain defenses for innocent owners, but there are still a number of federal statutes that don't. Congress needs to pass emergency legislation to add an innocent owner defense across the board to every forfeiture statute. Please write your Congressmen.

Libretti v. United States was a disappointment too

The Supreme Court said in Libretti that a criminal defendant who pleads guilty and agrees to forfeit property isn't entitled to a hearing to see whether the property was forfeitable. The Supreme Court said it was okay for prosecutors' plea bargains to include forfeiture of untainted assets, since the defendant would probably be glad to trade off assets for time in prison. This sounds too much like extortion to us.

Brian Degen v. U.S. (the Incline Village case) was a unanimous victory for a small class of people -- forfeiture victims who are fugitives from justice

On June 10, 1996, a forfeiture victim won his case in the U.S. Supreme Court. That was the only Supreme Court victory for our side since the landmark 1992-93 term. Ironically, this ruling will not help any forfeiture victims except fugitives from justice. Brian Degen, who had relocated his family to Switzerland in 1988, was indicted a year later in Reno, Nevada on drug charges. His real property in California was seized. Although he hired a lawyer to defend his forfeiture case, the District Court invoked the "fugitive disentitlement doctrine" and refused to let him defend the civil forfeiture case because he refused to appear in the separate criminal prosecution. The Supreme Court struck down the fugitive disentitlement doctrine in civil forfeiture cases. Degen may have trouble defending his case in absentia, but the Supreme Court held that he has a right to be heard before his property is forfeited.

Bissell's Accountant Pleads Guilty FEAR-List Bulletin 4/26/96

Search & seizure ruling, by Larry Gamm, FEAR-List Bulletin 3/31/96

United States v. Gainer, double jeopardy case, by FEAR Board member John Paff, FEAR-List Bulletin 2/8/96

New Jersey decision: no right to jury trial in civil forfeiture cases, by FEAR Board member John Paff, FEAR-List Bulletin 1/26/96

Double jeopardy ruling regarding drivers licenses suspensions, by Illinois FEAR coordinator King Cutcomp, FEAR-List Bulletin 1/18/96

"Nation's High Court Agrees To Review Civil Asset Seizures", FEAR-List Bulletin 1/16/96, reprinting article by Vin Suprynowicz, from his syndicated column, The Libertarian (discusses double jeopardy cases and victim stories of Bill and Karon Munnerlyn and Donald Scott)
 

1995
N.J. Judge Reserves Decision in Challenge To State Forfeiture Law (issue is right to jury trial, which state claims does not apply to forfeiture) FEAR-List Bulletin posted by John Paff, 12/15/95

Utah Ruling On Double Jeopardy FEAR-List Bulletin, 12/3/95, posted by John Paff

New Jersey double jeopardy appeal, excerpt from brief, FEAR-List Bulletin, 12/3/95, posted by John Paff

Florida double jeopardy update, FEAR-List Bulletin, 12/3/95, posted by John Paff

National Moot Court competition for 1995 deals with asset forfeiture issues, 11/16/95 e-mail from Russell Laws, University of Kansas Law School moot court team

Justice For Sale In New Jersey?: Victim Story of Isaac Wright, prosecuted by NJ's Nicholas Bissell, FEAR-List Bulletin, 10/15/95, posted by John Paff

"Judge Says Ventura District Attorney Doesn't Have to Divulge Documents," summary of AP article, posted to FEAR-List by Brenda Grantland, 9/20/95

Law Review article: "An Overview of Michigan's Viewpoint on Double Jeopardy Forfeiture/Excessive Fines", by Micheal Ward, inmate/paralegal in a Michigan state prison, FEAR-List Bulletin 7/28/95

Ninth Circuit Denies Government's Petition For Rehearhing in U.S. v. $405,089.23: Our Favorite Landmark Double Jeopardy Ruling Remains Intact! FEAR-List Bulletin, 5/30/95, by Brenda Grantland

Don't Feel Sorry For the Government On These Double Jeopardy Rulings -- They Knew Better Than Defy the Constitution, FEAR-List Bulletin, 5/23/95, by Brenda Grantland

Hallinan co-defendant, attorney Grellman, sentenced F.E.A.R. List Bulletin, 05/05/95, posted by Kathy Bergman

New Supreme Court Case Libretti F.E.A.R. List Bulletin, 03/29/95, posted by Brenda Grantland

1994
Supreme Court Denies Certiorari in Double Jeopardy & Forfeiture Case, F.E.A.R. List Bulletin, 12/10/94, by John Paff

Denial of Certiorari in Etim Doesn't Mean Supreme Court Isn't Concerned About Double Jeopardy, F.E.A.R. List Bulletin, 12/10/94, by Brenda Grantland

Quinones-Ruiz: Double Jeopardy Applies to Monetary Transaction Reporting Requirement Forfeitures" F.E.A.R. List Bulletin, 12/10/94, by Brenda Grantland, Esq.

PA Court Holds Right To Counsel Applies To Forfeiture Cases F.E.A.R. List Bulletin, 12/06/94, by Brenda Grantland, Esq.

Drug Sniffing Dog Testimony Discredited by Ninth Circuit F.E.A.R. List Bulletin, 12/03/94, by Brenda Grantland, Esq.