Opinion ID: 65776
Heading Depth: 3
Heading Rank: 1

Heading: Fourth Amendment Violation in Search of Property

Text: Setser next argues that law enforcement officials violated his Fourth Amendment rights in their conduct after they took possession of records and assets from the receiver. He suggests that because the receiver lacked the authority to seize all the documents he took, law enforcement agents needed to obtain a warrant in order to review the information obtained from the receiver. In our previously discussed Gray opinion, we found that a property owner no longer had a reasonable expectation that those records would remain private once a court has appointed a receiver, and the receiver has taken custody of records under the authority given him. Gray, 751 F.2d at 737. There is, in other words, no violation of the Fourth Amendment for a receiver who is the lawful custodian of the records to turn them over to law enforcement agents, at their request. Id. Though Gray 's analysis is relatively brief, its logic is clear when read in conjunction with the statutes governing the appointment and conduct of receivers. A receiver is vested with complete jurisdiction and control of all such [received] property with the right to take possession thereof. 28 U.S.C. § 754. A receiver shall manage and operate the property in his possession ... in the same manner that the owner or possessor thereof would be bound to do if in possession thereof. Id. § 959(b). Understanding the receiver's authority, we now examine what must be shown to establish a Fourth Amendment violation. A defendant must show that he had a reasonable expectation of privacy in the property searched. United States v. Gomez, 276 F.3d 694, 696-97 (5th Cir. 2001). The showing requires the defendant to prove (1) an actual, subjective expectation of privacy, and (2) that the expectation is one which society would recognize as reasonable. United States v. Kye Soo Lee, 898 F.2d 1034, 1037-38 (5th Cir.1990). Because the first factor simply examines whether a defendant actually expected privacy, which is not difficult to assert, the dispositive factor is almost always the second one. This second factor, the reasonableness of a privacy expectation, can be viewed from several practical perspectives: whether the defendant has a possessory interest in the thing seized or the place searched, whether he has the right to exclude others from that place, whether he has exhibited a subjective expectation that it would remain free from governmental invasion, whether he took normal precautions to maintain his privacy and whether he was legitimately on the premises. Gomez, 276 F.3d at 697-98 (quoting United States v. Haydel, 649 F.2d 1152, 1155 (5th Cir. Unit A July 1981)). We consider what occurred in the present case in terms of the list we just quoted from our precedents. Once the receiver took possession of the property, Setser's possessory rights were lost. Setser could neither exclude others from the seized property nor take precautions to maintain the privacy of the property. After appointment, the receiver was vested with complete jurisdiction and control of the property and had the right to take possession of it. 28 U.S.C. § 754. The receiver was required to manage and operate the property ... in the same manner as its original owner. Id. § 959. The receiver became the possessor, and as such could consent to the search of the seized documents. E.g., United States v. Brigham, 382 F.3d 500, 512 (5th Cir.2004) (en banc). We also find justification for what occurred from the fact that a receiver is to be appointed only after a prima facie showing of fraud and mismanagement. SEC v. First Fin. Group of Tex., 645 F.2d 429, 438 (5th Cir. Unit A May 1981). It would make little sense to hold that Setser continued to exercise veto power over the receiver's uses of his property when the purpose of the receivership was to preserve assets from fraudulent depletion. We conclude that after a receiver validly takes possession of records and other property, becoming their lawful custodian, the original owner has lost any reasonable expectation that those records would remain private. Gray, 751 F.2d at 737. Accordingly, Setser's Fourth Amendment rights were not violated when the receiver turned over the property he seized from Setser to law enforcement officials.