NO PERSON'S LIFE OR LIBERTY SHALL BE TWICE PLACED IN JEOPARDY FOR THE SAME OFFENSE; BUT THERE MUST BE AN ACTUAL ACQUITTAL OR CONVICTION ON THE MERITS TO BAR ANOTHER PROSECUTION. ARTICLE III, SECTION 22, MISSISSIPPI CONSTITUTION.
NO PERSON SHALL BE SUBJECT FOR THE SAME OFFENSE TO BE TWICE PUT IN JEOPARDY OF LIFE OR LIMB. AMENDMENT V, UNITED STATES CONSTITUTION.
EXCESSIVE BAIL SHALL NOT BE REQUIRED, NOR EXCESSIVE FINES IMPOSED. AMENDMENT VIII, UNITED STATES CONSTITUTION.
In recent years perhaps no area of constitutional law has changed so abruptly as the interpretation of the Double Jeopardy Clause of the United States Constitution. Every practitioner should be familiar with the Double Jeopardy test set forth in Blockburger v. United States, 284 U.S. 299 (1939). Simply stated, the Blockburger test permitted multiple prosecution only if each offense required proof of a fact which the other did not. Id. at 304. This test remained viable for fifty-eight years.
The United States Supreme Court in 1990, by a five-four opinion, handed down Grady v. Corbin, 495 U.S. 508 (1990). Grady formulated a new test for Double Jeopardy analysis that prohibited prosecution if the Government had to establish as an element of an offense, any conduct for which the defendant had already been prosecuted. Within three years the United States Supreme Court overruled Grady and returned to the Blockburger test. United States v. Dixon, 113 S.Ct. 2849. While the U.S. Supreme Court was struggling to define the Double Jeopardy test as it related to criminal prosecutions, another area of the Double Jeopardy clause became the victim of a new interpretation. In United States v. One Assortment of Eighty-Nine Firearms, 465 U.S. 354 (1984), the Court had previously established that separate civil sanctions, following criminal prosecution, did not result in Double Jeopardy violations. However, in United States v. Halper, 490 U.S. 435 (1989) the Court for the first time extended the Double Jeopardy protection to civil sanctions. The exact issue as it was framed by the Court was as follows:
In this way, we consider whether and under what circumstances a civil penalty may constitute 'punishment' for the purposes of Double Jeopardy analysis. Id. at 436.
The facts in Halper are important to an understanding of the Court's opinion and the later decisions that came out of the United States Supreme Court and lower Courts. The defendant in Halper submitted approximately sixty-five separate, false claims and received reimbursement from the United States Government (Medicare Fraud). The loss to the Government amounted to only $585.00. Halper was convicted of all sixty-five counts and eleven mail fraud counts.
After the prosecution of Halper concluded the Government sought statutory penalties in the amount of $130,000.00. The District Court denied the Government's penalties on the basis of Double Jeopardy and the Government appealed directly to the United States Supreme Court. The United States Supreme Court affirmed the District Court's ruling, stating, "In making this assessment [Double Jeopardy], the labels 'criminal' and 'civil' are not of paramount importance." 490 U.S. at 447. The Court went on to state that a person cannot be punished twice even though one of the punishments may be labeled "civil".
[A person] may not be subjected to an additional civil sanction to the extent that the second sanction may not fairly be characterized as remedial, but only as a deterrent or retribution. Id. at 449.
The Halper decision broke ground and opened up a whole new range of grazing
for criminal defense lawyers hungry for new defenses. Halper, however, was not
without its limitations. The decision in Halper did not prohibit all civil sanctions.
The Court upheld civil penalties that are imposed as a remedy for the actual
cost to the State attributable to the offender's conduct. There was additional
language in Halper indicating that the Double Jeopardy protection would only
be applied in the "rare case". Nevertheless, Halper is cited in every
post 1989 State and Federal Court opinion which attempts to understand and apply
the broad, prohibitive language set forth in Halper with the even broader civil
forfeiture statutes that have been passed by Congress.
Approximately four years after Halper the United States Supreme Court rendered the decision of Austin v. U.S., 113 S.Ct. 2801. Austin, combined with Halper, caused an explosion in the use of the Double Jeopardy defense in successive criminal and civil proceedings even though the Austin opinion did not rely upon Double Jeopardy as the basis of the decision.
The defendant in Austin entered a plea of guilty to a one count indictment of possession of cocaine with intent to deliver in violation of State law. Thereafter the United States Government filed an in rem civil forfeiture action against Austin's mobile home and body shop pursuant to 21 U.S.C., Section 881 (a)(4) and (a)(7). Austin contested the forfeiture and raised the excessive fine provision of the Eighth Amendment but did not raise the Double Jeopardy. The Austin Court set forth the issue as follows:
Thus, the question is not, as the United States would have it, whether forfeiture under Section 881 (a)(4) and (a)(7) is civil or criminal, but rather whether it is punishment.
Id. at 2806.
Perhaps the most important principle coming out of Austin was the Court's holding that forfeiture statutes constitute "punishment". The Court was unequivocal in holding that a civil sanction was punishment if it had any retributive or deterrent purpose, even though it also served some remedial purpose. The Court tersely wrote:
[A] civil sanction that cannot be said solely to serve a remedial purpose, but rather can only be explained as serving either a retributive or deterrent purpose is punishment, as we have come to understand the term. 490 U.S. at 448.
The Austin Court reasoned that a forfeiture pursuant to 21 U.S.C., Section 881(a)(4) and (a)(7), was based on prior criminal conduct that resulted in the forfeiture. Furthermore, the Court looked to the legislative history that confirmed the forfeiture statutes were punitive in nature. Without a doubt the most important feature of the Austin case was this language declaring forfeiture statutes punishment. The Double Jeopardy defense that was sown in Halper was nurtured by the declaration that forfeiture was punishment. The weakness of Austin is the fact that the United States Supreme Court did not establish a definite test for determining when a forfeiture statute violated the Excessive Fines provision of the Eighth Amendment. Rather than setting forth a bright line rule or providing any set criteria, such as the weighing criteria set forth in the famous speedy trial case of Barker v. Wingo, the Court in Austin stated, "Yprudence dictates that we allow the lower Courts to consider that question in the first instance." The Court did point out that the lower Courts could consider the connection between the property and the offense, but that other factors should also be considered. The concurring and dissenting opinion of Justice Scalia offer what has been referred to as the instrumentality test. According to Justice Scalia the question is as follows:
The question is not how much the confiscated property is worth, but whether the confiscated property has a clear enough relation to the offense.
Justice Scalia directed the lower Courts to make an examination and determine whether or not the property has a close enough relationship to the offense to render the property under traditional standards "guilty" and hence forfeitable.
The Austin and Halper decisions can be interpreted narrowly or broadly, depending on the predisposition of the reader. It is safe to deduce the following principles from Halper and Austin. a) A civil penalty may constitute punishment under the Double Jeopardy clause and the label that the governmental entity gives to the civil sanction is not controlling. b) The Excessive fines provisions of the Fifth Amendment is applicable to forfeiture actions, in particular actions brought under 21 U.S.C., Section 881 (a)(4) and (a)(7). c) Civil sanctions that are not wholly remedial are punishment. d) Forfeiture of goods or items that cannot be characterized as contraband or instruments of crime (i.e. guns, scales, etc.) are analyzed under the Excessive Fines Clause of the Eighth Amendment. (Note: An automobile was held not to be an instrument of a drug crime in Austin, and not an instrument of a liquor case in One 1958 Plymouth Sedan v. Pennsylvania, 380 U.S. 693 (1965).
It is worth noting that while the majority opinion in Austin may have directed lower Courts to develop tests for determining whether a forfeiture is constitutionally excessive, the Courts that have attempted to formulate a test have not been consistent. Some Courts have adopted the "instrumentality test" that was set forth in Justice Scalia's concurring and dissenting opinion. See U.S. v. Chandler, 36 F3d 358 (C.A. 4 1994). In Re King Properties, 635 A.2d 1228 (Pennsylvania Sup. Ct. 1993). Various other Courts have rejected the application of the instrumentality test and formulated a proportionality test. See U.S. v. 9638 Chicago Heights, 27 F.3d 327 (C.A. 8 1994); U.S. v. 6625
Zumirez Drive, 845 F.Supp. 725 (D.C. Calif. 1994); Aravanis v. Summerset County, Md.Ct. App. 22-1994 (9/13/95).
In 1994 the United States Supreme Court handed down another Double Jeopardy case which again had far reaching impact. Department of Revenue of Montana v. Kurth Ranch, 114 S.Ct. 1937. The defendants in Kurth Ranch were charged in four separate legal proceedings. One proceeding charged all defendants with State controlled substances offenses (marijuana). The defendants plead guilty to these offenses. The second proceeding was a civil forfeiture by the Government requesting forfeiture of cash and equipment used in the marijuana growing operation. The respondents settled the forfeiture proceedings. The third proceeding was an action filed by the State to collect $900,000.00 in taxes pursuant to the Montana Dangerous Drug Tax Act. Respondents contested these proceedings and they were stayed pending a Chapter 11 bankruptcy petition filed by the Respondents. The Bankruptcy Court held that the tax was a punishment and denied the Government's Proof of Claim. The District Court affirmed the Bankruptcy Court, and the Ninth Circuit Court of Appeals affirmed the District Court, relying in part on the Government's failure to produce any evidence of actual damages or costs. The decision in Kurth Ranch does not invalidate all taxes under the Double Jeopardy Clauses. The critical factors derived from Kurth Ranch may be summarized as follows: a) Is the tax conditioned on the commission of the crime or are the taxes purely revenue raising? b) Is the tax levied on goods that the person owns or possesses or as in Kurth Ranch levied on goods (i.e. marijuana) that the taxpayer does not even own at the time the taxes are levied? c) Is the tax imposed during the first prosecution or in a successive prosecution.
The United States Supreme Court has solidly established through Halper, Austin and Kurth Ranch that both the Double Jeopardy Clause of the Fifth Amendment and the Excessive Fines Clause of the Eighth Amendment can and will apply to civil sanctions. Numerous Courts and legal scholars have simplified the cases and formulated a two part test for determining whether a civil sanction constitutes a violation of Double Jeopardy. These criteria are (1) whether the civil forfeiture/sanction/tax constitutes punishment, and (2) whether the civil forfeiture/sanction/tax and the criminal prosecution constitute separate proceedings. These two rather simple criteria have still generated considerable differences of opinion in Courts across the United States. Unfortunately neither Halper, Austin, nor Kurth Ranch involved the forfeiture or seizure of large sums of currency alleged to be the direct result of illegal drug transactions. Had any one of these decisions dealt with forfeiture under 21 U.S.C., Section 881 (a)(6), and if the Court had determined that the forfeiture of cash proceeds constituted Double Jeopardy, then no doubt many of us practicing criminal defense would find ourselves better compensated.
After Halper and Austin a number of lower Courts struggled with the application of the Excessive Fines and Double Jeopardy clauses. The Halper and Austin decisions no doubt came as a great shock to prosecutors, judges and defense attorneys. One District Court judge in Texas may have accurately captured the attitude of many judges by the following comment:
The implications of Supreme Court Double Jeopardy and Excessive Fines jurisprudence is staggering - hundreds of prisoners will flood the courts with demands for release on Double Jeopardy grounds, and, ultimately, many will prevail. Indeed under the current jurisprudence, civil forfeiture is no longer the powerful weapon in the war against drugs that Congress intended it to be but a time bomb is about to explode. Nonetheless, the undersigned is required to follow legal precedent, albeit with grave misgivings and concern for the harm that will be inflicted upon society by setting hundreds of drug dealers free.
May v. United States, United States District Court, Western Division of Texas, No. A95ca263SS, decided August 10, 1995.
The sentiments expressed by the District Court in May were obviously felt by other District judges around the various Federal circuits.
In United States v. Millan, 2 F.3d 17 (2nd Cir. 1993), the Government obtained an indictment against the defendant for violation of 21 U.S.C., Section 812, 841 (a)(1), 841 (b)(1)(A), and 846. The indictment also included a criminal forfeiture count. In addition the Government filed a separate civil forfeiture proceeding. Prior to the trial the defendant entered into a stipulated settlement of the separate forfeiture proceeding. Before the trial the defendant raised the Double Jeopardy defense. The District Court denied the claim and the Second Circuit Court of Appeals affirmed holding that (1) the civil and criminal proceedings constituted a single proceeding; (2) the value of the seized property was not disproportionate to the value of the illegal activity giving rise to the indictment; and, (3) the defendants were estopped to raise Double Jeopardy because they settled their claim.
The opinion in Millan appears to be ill-reasoned and flies in the face of both Austin and Halper. Kurth Ranch had not been decided at the time the decision in Millan was rendered. It is interesting to note that the Appeals Court in Millan held that the civil and criminal proceedings were "one prosecution" even though they were separate actions. The Court came to this peculiar conclusion by declaring that even though they were separate proceedings both were filed on the same day; both were issued on the same affidavit; therefore both were part of a coordinated law enforcement effort and constitute a single proceeding. See also: United States v. Baird, 63 F.3d 1213 (3rd C.A. 1995) wherein the Court held that an administrative forfeiture of unclaimed money could not constitute Double Jeopardy.
In United States v. One Single Family Residence at 18755 North Bay Road, Miami, 13 F.3d 1493 (11th Cir. 1994), the Court of Appeals was faced with a forfeiture action against a $150,000 home following a conviction for gambling offenses. The Government filed a separate criminal forfeiture action that was not decided until a number of months after the defendant's conviction for the gambling violations. Fortunately the defendant prevailed because he raised an Excessive Fines defense under the Eighth Amendment. The lower Court held the penalty was grossly disproportionate to the minor criminal violation. What is interesting about the opinion is that the Eleventh Circuit Court followed Millan (Second Circuit) and held that even though the forfeiture was a separate proceeding it did not violate Double Jeopardy because "Ythere was simultaneous pursuit by the Government of criminal and civil sanctions pursuant to 18 U.S.C., Section 1955 [and this] falls within the contours of a single, coordinated prosecution." 14 F.3d at 1499. The decisions in Millan and U.S. v. One Single Family Residence do not faithfully follow the decision in Halper. After Kurth Ranch was decided it is doubtful whether the opinions in Millan and U.S. v. One Single Family Residence are valid. In Kurth Ranch the Supreme Court held that the tax proceedings that were instituted at the same time as the criminal proceeding were successive proceeding, therefore the reasoning in Millan and One Single Family Residence seems completely obliterated.
In contrast to Millan and One Single Family Residence are the decisions in U.S. v. One 1978 Piper Cherokee Aircraft, 37 F.3d 489 (9th Cir. 1994) and U.S. v. $405,089.23, 33 F.2d 1210 (9th Cir. 1994). Both of these decisions are important Double Jeopardy cases that deserve thorough study. The opinion in U.S. v. $405,089.23 is a well reasoned opinion and can give the practitioner a quick grasp and understanding of how to formulate his Double Jeopardy argument. In U.S. v. $405,089.23, supra, a criminal conviction was obtained and eight months later the Government filed a civil forfeiture. The civil forfeiture was a different proceeding before a different judge though it basically repeated the same conduct used for the criminal conviction. The Ninth Circuit Court of Appeals rejected the decisions of the Second and Eleventh Circuit that had held separate civil forfeiture proceedings did not constitute Double Jeopardy. The Ninth Circuit noted that the civil forfeiture and the criminal action were two separate actions. They were tried at different times before different fact finders and presided over by different judges. Both were resolved by separate judgments. The Court stated its opinion of Millan and U.S. v. One Single Family Residence by saying, "[w]e believe the position adopted by the Second and Eleventh Circuits contradicts controlling Supreme Court precedent as well as common sense." 33 F.2d at 1216.
All of the Courts that have considered this issue agree that if the Government chooses to bring a forfeiture count in an indictment, and thereby obtains forfeiture of the items at the same time as a conviction, then the Double Jeopardy provision of the Fifth Amendment is not implicated. The Government would still be limited by the Excessive Fines provision of the Eighth Amendment. See Oaks v. U.S., 872 F.Supp. 817 (E.D. Washington 1994); U.S. v. Agular, 886 F.Supp. 740 (E.D. Washington 1994).
Most people are probably familiar with the old saying, "the grass is greener on the other side of the fence". This saying is carried forward in the law but takes on a different spin. Favorable law only seems to exist outside the circuit in which you practice. This can best be illustrated by the case of U.S. v. Tilley, 18 F.3d 295 (5th Cir. 1994). In Tilley the defendants sought to have their criminal indictments dismissed on the basis of Double Jeopardy. The Government had previously filed in rem civil forfeiture proceedings against certain real and personal property belonging to defendants. The defendants settled the forfeiture prosecution. They then attempted to use that judgment as a Double Jeopardy bar to prosecution. The Fifth Circuit discounted the defendants' arguments quoting the language of Halper that Double Jeopardy would only apply in "rare cases". The Fifth Circuit went on to state that a civil sanction constitutes criminal punishment only when the amount of the sanction is "overwhelmingly disproportionate" to the damages caused by the wrongful conduct and thus "Ybears no rational relationship to the goals of compensating the Government for its loss, but rather appears to qualify as 'punishment' within the plain meaning of the word." 18 F.3d at 298.
The Fifth Circuit Court of Appeals determined that the proceeds that were forfeited by the defendants were rationally related to the cost incurred by the Government and society. In fact, the Court held that the forfeiture of $650,000 failed to fully compensate the Government and society for the illegal acts committed by the defendants.
The Court in Tilley also distinguished Austin by holding that the forfeiture of drug proceeds under Section 881 (a)(6) does not violate the Excessive Fines Clause. The reasoning of the Tilley Court can be summed up as follows: The Defendants gained their money through illegal activities and were not entitled to rightful possession of the money. Therefore the Government's seizure of the money as drug proceeds did not violate the Excessive Fines provision or the Double Jeopardy clause. Since the defendants did not rightfully own the money, the defendants could not complain of the forfeiture.
The Tilley decision was decided one month before the United States Supreme Court decided Kurth Ranch. It is doubtful whether the Kurth Ranch decision would have made any difference to the Fifth Circuit Court of Appeals. In light of the clear mandate by Congress to strip persons engaged in controlled substances crimes of their assets, it seems clear that the decision in Kurth Ranch would have had little effect on the Tilley Court. For everyone practicing in the Fifth Circuit it appears that Halper, Austin, and
Kurth Ranch will provide little solace to forfeiture actions brought against assets that are clearly the proceeds from drug sales.
In addition to the problems posed by Tilley, the United States Court of Appeals for the Seventh Circuit raised another roadblock. In United States v. Torres, 28 F.3d 1463 (7th Cir. 1994), the Court held that the failure to contest a forfeiture results in a waiver of the Double Jeopardy defense. See also United States v. Walsh, 873 F.Supp. 334 (D. Ariz. 1994). The Fifth Circuit recently concurred in this principle U.S. v. Ramos, No. 94-10967 (July 20, 1995). See also: 13 F3d 432 (1st Cir. 1993); United States v. Schiavo, 1995 WL 521870 (D. Mass.); United States v. Field, 62 F.3d 246 (8th C.A. 1995); 14 F.3d 536 (10th C.A. 1994).
The decisions in Halper, Austin and Kurth Ranch provide strong support for a Double Jeopardy and Excessive Fines defense in civil forfeiture/sanctions actions. These defenses are likely to be most effective when the Government is attempting to seize tangible, personaly property other than cash. The Fifth Circuit's opinion in Tilley seemed to have forclosed the defenses if an action is brought by the Government under 21 U.S.C., Section 881 (a)(6). However, it is certainly worth trying the defenses. Who would have ever expected the decisions in Halper, Austin and Kurth Ranch?
BY: MERRIDA COXWELL
KEYES, DANKS, COXWELL & LEONARD
TELEPHONE: (601) 948-310