Opinion ID: 461301
Heading Depth: 2
Heading Rank: 2

Heading: The Restraining Order

Text: 47 Count Two of the indictment charges Crozier with engaging in a continuing criminal enterprise in violation of 21 U.S.C. Sec. 848 (1976). The penalties for violating section 848 include forfeiture of all profits obtained through the criminal enterprise. 48 The district court granted the government's ex parte motion for a restraining order to prevent Crozier from selling, transferring or encumbering almost all of his real and personal property. The order also restrains Wolke from disposing of her property even though she is not a defendant in the continuing criminal enterprise count. 49 In the earlier proceeding, we held that the district court erred in failing to hold a hearing on the validity of the restraining order. Rule 65 of the Federal Rules of Civil Procedure requires an immediate hearing whenever the court grants a temporary restraining order ex parte. We applied Rule 65 because section 848 does not specify when a restraining order should issue. 50 The Supreme Court called our attention to United States v. Eight Thousand Eight Hundred and Fifty Dollars ($8,850) in U.S. Currency, 461 U.S. 555, 103 S.Ct. 2005, 76 L.Ed.2d 143 (1983), in which the Court approved an eighteen-month delay between the government's seizure of 8,850 dollars and its petition for civil forfeiture of the money. 51 The defendant in Eight Thousand Dollars was indicted for violation of customs laws; there are statutory procedures which the Customs Service follows to effect a forfeiture. Here, section 848 does not contain a procedure for forfeiture. Absent statutory guidance, we apply the Federal Rules of Civil Procedure. 52 After our decision and the decree of the Supreme Court in Eight Thousand Dollars, Congress enacted the Comprehensive Crime Control Act of 1984 (the Act), Pub.L. No. 98-473, 98 Stat. 1976 (1984). The Act adds criminal forfeiture provisions to the Comprehensive Drug Abuse Prevention and Control Act, 21 U.S.C. Sec. 841 et seq., the act under which Crozier was indicted. The Act provides that upon the government's application, the court may enter a restraining order against property which may be subject to forfeiture under federal drug laws. 21 U.S.C. Sec. 853(e). This order may issue when an indictment or information is filed. Id. Sec. 853(e)(1)(B). 53 Third parties who assert an interest in the restrained property are not entitled to intervene in a trial or appeal involving the forfeiture of that property. 21 U.S.C. Sec. 853(k). They may request a hearing to adjudicate their interest in the property but only after the property has been ordered forfeited. 21 U.S.C. Sec. 853(n)(2). A forfeiture may only be ordered if a defendant is convicted. 21 U.S.C. Sec. 853(a). 54 The forfeiture provisions are designed to eliminate the statutory limitations and ambiguities that have frustrated active pursuit of forfeiture by Federal law enforcement agencies. S.Rep. No. 225, 98th Cong., 2d Sess. 192, reprinted in 1984 U.S.Code Cong. & Ad.News 3182, 3375. Before the Act was passed, the government before trial was required to establish the merits of its underlying case in order to support the restraining order. 55 Under the new Act, third parties who are not charged with an offense for which forfeiture is a penalty must await the conviction or acquittal of the defendant before they file proceedings to protect their interest in the forfeited property. 56 Under the United States Constitution, 1 Congress may not enact any law which imposes a punishment for an act that was not punishable at the time it was committed or any law which imposes punishment greater than the punishment prescribed when the act was committed. Weaver v. Graham, 450 U.S. 24, 28, 101 S.Ct. 960, 963, 67 L.Ed.2d 17 (1981). Wolke asserts that retroactive application of the Act violates the Constitution's proscription against ex post facto laws. 57 An ex post facto law requires two elements. First, it must be retrospective. Second, it must disadvantage the offender affected by it. Id. at 29, 101 S.Ct. at 964. 58 If the change is merely procedural and does not increase the punishment or change the elements of a crime, it is not an ex post facto law. In Dobbert v. Florida, 432 U.S. 282, 293, 97 S.Ct. 2290, 2298, 53 L.Ed.2d 344, reh'g denied, 434 U.S. 882, 98 S.Ct. 246, 54 L.Ed.2d 166 (1977), the Supreme Court upheld the retrospective application of a change in the role of the judge and the jury in imposing the death penalty. The Court noted that the law did not change the quantum of punishment but merely altered the methods of imposing the penalty. Id. at 293-94, 97 S.Ct. at 2298. 59 This Act does not change the fact of forfeiture as punishment but merely establishes the procedure by which forfeiture will be carried out. Therefore, Wolke will not face any greater punishment as a result of the new law. Retroactive application of the forfeiture provisions does not violate the constitutional prohibition against ex post facto laws. 60 Wolke next asserts that the Act violates her Fifth Amendment right to due process of law and that it is unconstitutional on its face because Congress failed to provide for a hearing on a restraining order before trial or conviction. 61 We agree. We recently pointed out that [a]dequate, or due, process depends upon the nature of the interest affected. Haygood v. Younger, 769 F.2d 1350, 1355 (9th Cir.1985). To determine what process is due, we must balance the risk of an erroneous deprivation, the state's interest in providing specific procedures and the strength of the individual's interest. Cleveland Board of Education v. Loudermill, --- U.S. ----, 105 S.Ct. 1487, 1494, 84 L.Ed.2d 494 (1985); Mathews v. Eldridge, 424 U.S. 319, 335, 96 S.Ct. 893, 903, 47 L.Ed.2d 18 (1976); Haygood, 769 F.2d at 1356. 62 Because Wolke and Crozier had significant property interests in the real and personal property seized by the government, due process requires that they be afforded the opportunity to be heard at a meaningful time and in a meaningful manner. Armstrong v. Manzo, 380 U.S. 545, 552, 85 S.Ct. 1187, 1191, 14 L.Ed.2d 62 (1965); Haygood, 769 F.2d at 1356. The statutory forfeiture provisions do not satisfy due process. We believe that the absence of any hearing on the imposition of a restraining order on a defendant's property, or a hearing for parties with a third party interest which takes place months or years after a restraining order is issued, cannot be construed as a hearing provided at a meaningful time. The risk of an erroneous deprivation under these procedures is high. 63 Under the Act's forfeiture provisions, neither the defendant nor a third party may challenge a restraining order unless and until the defendant is convicted. This case was filed more than five years ago, and the defendant's trial and appeals may take several years more. If the defendant is acquitted, the validity of the restraining order is moot and parties with an interest in the property may have no remedy for the lengthy and wrongful deprivation of their property. 64 We hold that the forfeiture provisions of the Comprehensive Crime Control Act do not comply with the due process requirements of the Fifth Amendment to the United States Constitution. More specifically, we find 21 U.S.C. Sec. 853(e)'s provisions for restraining orders or injunctions on the filing of an indictment, and the hearing provisions in 21 U.S.C. Sec. 853(n) for those with third party interests, do not protect the rights of defendants and third parties. 65 In the absence of valid procedural guidelines, we again hold that Rule 65 of the Federal Rules of Civil Procedure governs the restraining order and that the district court erred in denying without a hearing the motions of Crozier and Wolke to dissolve the restraining order.