Forfeiture

As forfeitures have soared, those harmed, particularly innocent third parties, have raised various constitutional challenges. Parties have claimed that civil forfeiture which permits summary, no-notice seizures of property, allows the government to take property on minimal proof that it was tainted with illegality, shifts the burden of proof of innocence to the property owner, and denies minimal procedural due process guaranteed by the Fifth and Fourteenth Amendments. With one exception, the federal courts have been unsympathetic.

In United States v. James Daniel Good Real Property, 510 U.S. 43 (1993), the Supreme Court modestly heightened procedural protections by limiting the government's authority to seize certain property with no advance notice or opportunity to be heard. At least with respect to real property, such as houses or farms, the Court held that, absent exigent circumstances, procedural due process requires pre-seizure notice and an opportunity to be heard. While the ruling is a welcome development for property owners, including apartment dwellers, it applies only to real property. Cars, boats, planes, currency, and other movables remain automatically covered by the exigent need to seize-first-and-ask-questions-later.

Substantively, parties have argued that, as applied in particular circumstances, forfeiture laws also violate the excessive fines clause of the Eighth Amendment, constitute double jeopardy under the Fifth and Fourteenth Amendments, and are fundamentally unfair to innocent owners under principles of substantive due process. With the exception of the excessive fines attack, the courts have essentially rebuffed these claims as well. And, as with the challenges to forfeiture procedures, they have done so largely based on long historical acceptance of the forfeiture remedy.

The Eighth Amendment provides that excessive fines shall not be imposed. The Supreme Court has held that a fine is a monetary penalty exacted for some offense and, specifically, that a forfeiture is a fine if it is punishment for an offense. In United States v. Bajakajian, 524 U.S. 321 (1998), the Court concluded that criminal forfeitures are fines because they are additional penalties imposed on defendants for criminal behavior. In Bajakajian the defendant pleaded guilty to failing to report that he was transporting more than $10,000 in currency outside of the United States. In addition to a term of probation and a conventional fine of $5,000, the government sought criminal forfeiture of the entire amount that the defendant sought to remove from the country, namely $357,144. In the only Supreme Court case ever to find a fine excessive, whether a criminal forfeiture or otherwise, the Court held that confiscation of $357,144 for a currency violation was "grossly disproportional" to the gravity of the offense and, therefore, excessive. The defendant's crime was solely a reporting violation, unrelated to any other criminal activity, and the harm caused was minimal.

In Bajakajian, the Court left intact its earlier ruling from Austin v. United States, 509 U.S. 602 (1993), that civil forfeitures, too, could be fines and could be unconstitutionally excessive. But Bajakajian clouded the rationale for applying the excessive fines clause to civil, as opposed to criminal forfeitures. Austin said that civil forfeitures were historically understood to be punishment, and the only question was whether they were grossly disproportionate and, hence, excessive. Not all civil forfeitures are disproportionate. It is perfectly proportionate to seize drugs or other contraband, no matter how valuable, because, by definition, that property is illegal to possess. It is also perfectly proportionate to seize the proceeds of a crime offense since criminals should not profit from their wrongdoing. Gross disproportionality potentially arises when the government seizes instrumentalities (i.e., property used to commit or to facilitate a crime) especially if it is property owned by someone uninvolved in the criminal activity itself. In Bajakajian the Court seemed to say, however, that no traditional or historically accepted civil forfeitures, whether of contraband, proceeds, or instrumentalities, could ever be considered punishment. Only those modern in rem forfeitures that "blurred the traditional distinction between civil in rem and criminal in personam forfeiture" could be punishment and, thus, limited by the excessive fines clause. But the Court's new distinction in Bajakajian 524 U.S. at 331 was never explained, and the application of the excessive fines clause to modern civil forfeiture is now in doubt.

Parties have also raised double jeopardy claims to challenge forfeitures. The double jeopardy clause provides protection against being twice tried or punished for the same offense. It is inapplicable to criminal forfeitures because the imposition of criminal punishment such as jail and forfeiture is imposed in a single criminal proceeding. But defendants claimed that a criminal penalty imposed in a criminal case followed by a separate civil forfeiture arising out of the same facts, or vice versa, was double punishment. The idea was derailed in United States v. Ursery, 518 U.S. 267 (1996). Civil forfeitures, the Court said, were primarily civil regulatory measures that encouraged people to insure that their property was not used for illicit purposes. The Court noted that although forfeitures may have some punitive aspects, historically they were not regarded as punishment, and viewed in their entirety were not so punitive as to render them a form of double jeopardy punishment.

A final, doomed constitutional challenge to civil forfeiture rested on the claim that applying forfeiture to seize the property of innocent owners was a violation of substantive due process because it was arbitrary and irrational. Seizing the property of innocent owners does make sense if the property is contraband. It is also rational to seize property that constitutes traceable proceeds of crime, even in the hands of innocent third parties. The idea is that in deciding between harm to the innocent third party and closing off avenues for criminals to launder their profits, a legislature may rationally choose to frustrate the criminal. Moreover a third party, like a lawyer, may be in a position to consider whether property was obtained from a known or suspected criminal. But even the Supreme Court seemed to acknowledge that forfeitures applied to innocent persons whose property was simply used by another to commit a crime could be irrational.

In Calero-Toledo v. Pearson Yacht Co., 416 U.S. 663 (1974) the Court upheld the forfeiture of a yacht because a single marijuana cigarette was found on board. The lessor boat company had no knowledge of the drug use but failed to show what degree of care it used in supervising how the boat was used. The Court upheld the forfeiture saying it might induce lessors to exercise greater care. At the same time, the Court also observed that it would be difficult to reject the constitutional claim of an owner who was innocent and proved he had done all that he could do to prevent the illicit use of his property. But that is precisely what a plurality of the Court did in Bennis v. Michigan, 516 U.S. 442 (1996) where it permitted the forfeiture of an innocent wife's interest in a car seized from her husband.

In Bennis, the husband had been convicted of an indecent act with a prostitute in the vehicle. The wife's interest was sacrificed even though she had absolutely no awareness that her husband had behaved or would behave as he did. Nevertheless, the plurality reasoned that there was long-standing precedent permitting forfeiture against innocent owners and that such forfeitures serve purposes such as preventing further illicit use of the property. Justice Clarence Thomas, writing separately, said that forfeiture of property of innocent owners was valid because it was blessed by history and that the case was a reminder that the Constitution did not prohibit everything that was intensely undesirable. His comments underline the reality that, except for the requirement of pre-seizure notice to seize real property and some boundaries on grossly disproportionate criminal forfeitures, the constitution places very few limits on the use of a practice courts have described as harsh and oppressive. They also make clear that if reforms do come, they must come from the legislatures that originally created and successively broadened modern criminal and civil forfeiture.