Court Opinion

ID: 9481292
Source: CourtListenerOpinion
Date Created: 2023-08-05 08:13:45.882388+00
Date Added: 2024-06-11T17:48:12.250427
License: Public Domain

CARDAMONE, Circuit Judge,
dissenting:
The underlying issue posed on this appeal is whether the pretrial restraint provision of the Comprehensive Forfeiture Act of 1984 (Act), 21 U.S.C. § 853(e) (1988), grants a district court authority to hold a pretrial hearing — after it issues an order restraining defendant’s property — in order to determine whether probable cause exists to continue such restraint of allegedly for-feitable assets until a trial on the merits. To resolve this issue we asked counsel to address two questions: (1) Does the Due Process Clause require such a hearing before a pretrial restraining order may be imposed on those assets a defendant needs to retain counsel of choice? (2) If so, may this requirement be judicially imposed, or must it be legislated? My colleagues believe that the statute denies due process because as it is written it fails to provide for a hearing. The majority therefore would judicially engraft a hearing requirement on Congress’ enactment. The minority would strike the statute as unconstitutional. I am unable to concur in either proposition and write in this case to express my view that the statute as presently framed is constitutional.
I
Our review today of these statutory and constitutional questions is instructed by two recent Supreme Court decisions regarding appellant’s rights under the Sixth Amendment, United States v. Monsanto, 491 U.S. 600, 109 S.Ct. 2657, 105 L.Ed.2d 512 (1989), and a companion case, Caplin & Drysdale, Chartered v. United States, 491 U.S. 617, 109 S.Ct. 2646, 105 L.Ed.2d 528 (1989), both of which were decided subsequent to our Monsanto, en banc, decision. In those cases the Supreme Court clarified two points pertinent to this appeal: first, it indicated that the discretion afforded by the statute’s language — “the court may enter a restraining order” — does not allow a trial court to use its equitable power to balance a defendant’s hardships against the merits of the government’s case to determine whether such an order should issue, Caplin & Drysdale, 109 S.Ct. at 2650-2651; Monsanto, 109 S.Ct. at 2664-2665. Second, the Court held that a defendant’s limited right to counsel of choice is not impermissibly infringed by the forfeiture statute. Caplin & Drysdale, 109 S.Ct. at 2656; Monsanto, 109 S.Ct. at 2666-67.
In my view, now informed by those Supreme Court cases, there is no due process requirement for a pretrial hearing on the merits. If the provisions of 21 U.S.C. § 853(e)(1)(A) (1988) that we review are, as I believe, constitutional then we need not consider or decide the second question of how to include a hearing requirement. Because the position I take differs in substance from that of my respected colleagues, Chief Judge Oakes and Judge Ma-honey, it is necessary to set forth the reasons that led me to it.
A.
To determine whether a pretrial hearing requirement is consistent with the aim of the Act, we must turn first to its language. Section 853(e)(1)(A) states that a protective order may be issued
upon the filing of an indictment or information charging a violation ... and alleging that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture.
Nothing in those words suggests that after an indictment has been filed a hearing must be held before a court may issue a protective order. See United States v. Bissell, 866 F.2d 1343, 1349, 1352 (11th Cir.), cert. denied, — U.S.-, 110 S.Ct. 146, 107 L.Ed.2d 104 (1989). Significantly, when the government seeks to restrain assets prior to the filing of an indictment a different procedure is provided. In that case a protective order may be issued only if — after notice to persons who may have an interest in the property and an opportunity for a hearing — the court determines that (1) there is a substantial probability *1206that the government will prevail on the merits of the forfeiture claim, (2) the protective order is necessary to protect the government’s interest in the property, and (3) the need for the order outweighs the hardship it causes. 21 U.S.C. § 853(e)(1)(B). Such a pre-indictment order may not be effective for more than 90 days. Id.
The distinctions Congress made in the treatment of asset restraint in the pre- and post-indictment periods lends strong support to the conclusion that the legislature’s omission of a hearing requirement after an indictment is filed was purposeful. See United States v. Moya-Gomez, 860 F.2d 706, 727 (7th Cir.1988), cert. denied, — U.S.-, 109 S.Ct. 3221, 106 L.Ed.2d 571 (1989); see also INS v. Cardoza-Fonseca, 480 U.S. 421, 432, 107 S.Ct. 1207, 1213, 94 L.Ed.2d 434 (1987) (omission of language in one part of a statute presumed intentional).
B.
The legislative history of § 853 further supports the view that Congress planned for the trial on the merits to be the sole challenge to the forfeitability claim. The statute was passed in an attempt to remedy the ineffectiveness of the forfeiture provisions contained in the Continuing Criminal Enterprise Act, 21 U.S.C. § 848 (1988), and the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1961-68 (1988). S.Rep. No. 225, 98th Cong., 2d Sess. 191-92, 202, reprinted in 1984 U.S. Code Cong. & Admin.News 3374-75, 3385 [Senate Report]. In particular, Congress sought to enhance the sanction of criminal forfeiture as a law enforcement tool in combatting racketeering and drug trafficking crimes. Id.
It stated that the stringent standard formerly applied by courts before issuing restraining orders, in addition to making the orders difficult to obtain, discouraged prosecutors from seeking them because the papers filed with the application often caused premature disclosure of the government’s case and its trial strategy, and risked the safety of witnesses and victims whose statements were required to support the application. Senate Report at 196, reprinted in 1984 U.S.Code Cong. & Admin.News 3379.
To alleviate this state of affairs Congress drafted a statute specifically providing that an indictment shall contain an allegation that the property to be restrained is subject to forfeiture upon conviction. The Act makes forfeitability of assets a substantive charge in the indictment, see Caplin & Drysdale, 109 S.Ct. at 2654 n. 5. As a consequence, the indictment itself finds probable cause that the assets sought to be restrained are forfeitable. See United States v. Musson, 802 F.2d 384, 386 (10th Cir.1986). The Senate Report elaborates:
Thus, the probable cause established in the indictment or information is, in itself, to be a sufficient basis for issuance of a restraining order. While the court may consider factors bearing on the reasonableness of the order sought, it is not to “look behind” the indictment or require the government to produce additional evidence regarding the merits of the case as a prerequisite to issuing a post-indictment restraining order.
Senate Report at 202, reprinted in 1984 U.S.Code Cong. & Admin.News 3385.
The prosecution’s ability to prepare its case without being forced to “tip its hand” prematurely was of paramount importance to the drafters and provides a persuasive reason for delaying a full adversarial hearing on the merits of the government’s case during the post-restraint, pretrial period. The legislative history makes clear that in the post-restraint period “the court is not to entertain challenges to the validity of the indictment.” Senate Report at 203, reprinted in 1984 U.S.Code Cong. & Admin.News 3386.
Yet a trial court’s discretionary authority is not completely eliminated. The Act states that upon application of the United States the court “may” enter a protective order. 21 U.S.C. § 853(e)(1). Concededly, the latitude of that discretion arising from use of the word “may” has been narrowed by the Supreme Court’s interpretation of the Act. But the statute provides that a court may “enter a restraining order or injunction, require the execution of a satisfactory performance bond, or take any other action to preserve the availability of property ...” § 853(e)(1). Thus, a trial *1207court retains discretion in determining what measures are necessary to protect the government’s interest in the property. Id,.; see also Senate Report at 202, reprinted in 1984 U.S.Code Cong. & Admin.News 3385 (“the court may consider factors bearing on the reasonableness of the order”).
In addition, the legislative history expressly refers to the court’s authority to hold a post-restraint hearing to determine if the order imposed should be modified. At such hearing the court’s function is limited to correcting “clearly improper” orders:
This provision does not exclude, however, the authority to hold a hearing subsequent to the initial entry of the order and the court may at that time modify the order or vacate an order that was clearly improper {e.g., where information presented at the hearing shows that the property restrained was not among the property named in the indictment). However, it is stressed that at such a hearing the court is not to entertain challenges to the validity of the indictment. For the purposes of issuing a restraining order, the probable cause established in the indictment or information is to be determinative of any issue regarding the merits of the government’s case on which the forfeiture is to be based.
Senate Report at 203, reprinted in 1984 U.S.Code Cong. & Admin.News 3386 (emphasis added).
This retained discretionary authority allows the trial court to issue a restraining order employing the least restrictive means needed to protect the government’s interest, or to modify an unnecessarily restrictive order. Hence, in the post-restraint, pretrial period the court’s role is primarily ministerial. See Monsanto, 109 S.Ct. at 2665. The legislative history could not be more plain in its statement that “the court is not to entertain challenges to the validity of the indictment.” Adjudication of the merits of the forfeiture must take place at, not before, trial. See Bissell, 866 F.2d at 1349, 1352.
Having demonstrated that the language and legislative history of § 853 make no provision for a pretrial adversarial hearing on the merits of the forfeiture claim, the next question is whether this statutory scheme violates the Fifth Amendment’s proscription against deprivation of property without due process of law.
II
The starting point on any challenge to a statute’s constitutionality must be the presumption that Congress was well aware of its obligation to draft laws that comply with the Constitution. See, e.g., DeBartolo Corp. v. Florida Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568, 575, 108 S.Ct. 1392, 1397, 99 L.Ed.2d 645 (1988) (“Congress, like this Court, is bound by and swears an oath to uphold the Constitution. The courts will therefore not lightly assume that Congress intended to infringe constitutionally protected liberties_”). A facial challenge will succeed only if appellant establishes that under no set of circumstances would the challenged statute be valid. That it may operate unconstitutionally under some set of circumstances and constitutionally under others will not suffice to render a statute wholly invalid. United States v. Salerno, 481 U.S. 739, 745, 107 S.Ct. 2095, 2100, 95 L.Ed.2d 697 (1987).
The Act permits a restraint of a defendant’s property. We recognize that the restraint of a person’s assets, however temporary, is a deprivation of property, see Fuentes v. Shevin, 407 U.S. 67, 84-86, 92 S.Ct. 1983, 1996-97, 32 L.Ed.2d 556 (1972); Sniadach v. Family Finance Corp., 395 U.S. 337, 339, 89 S.Ct. 1820, 1821, 23 L.Ed.2d 349 (1969), and to withstand constitutional scrutiny such deprivation must be implemented in a fair manner, that is, in accordance with due process. Mathews v. Eldridge, 424 U.S. 319, 332-333, 96 S.Ct. 893, 901, 47 L.Ed.2d 18 (1976). Whether the process afforded is sufficient may be determined by balancing three factors: the private interest affected, the risk of an erroneous deprivation and the possible value of additional or substitute procedural safeguards, and the government’s interest. Id. at 335, 96 S.Ct. at 903; see also Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 542-43, 105 S.Ct. 1487, 1493, 84 L.Ed.2d 494 (1985). Weighing the challenged provisions of the Act in light of those factors, I am convinced that the government’s interest in delaying until trial an adversarial hearing on the merits of the restraint of assets outweighs the minimal intrusion a restraining order imposes upon a defendant.
1. Defendant’s Interest in Unrestrained Use of Assets Pending Trial
It must be emphasized at the outset that a protective order merely restrains defen*1208dant’s property; it does not seize it. A warrant authorizing actual seizure of property subject to forfeiture may be issued only upon a district court’s determination that there is probable cause to believe that the property seized would be forfeitable upon conviction and that a protective order is insufficient to assure the property’s availability. See 21 U.S.C. § 853(f).
Defendant claims his interest in the use of his assets pending trial is made greater because he needs them to hire his counsel of choice. In examining this factor — defendant’s private interest as affected by official action — we cannot turn a blind eye to the Supreme Court’s discussion of how the forfeiture provisions affect a defendant’s Sixth Amendment right to counsel.
The Supreme Court’s declaration that the Sixth Amendment is not violated by the forfeiture provisions here at issue, Caplin & Drysdale, 109 S.Ct. at 2656, leads to the logical conclusion that appellant’s asserted interest in using the assets to retain counsel should not weigh more when that interest is considered under the Fifth Amendment. Id. This is especially true given that even absent a protective order any forfeitable assets used to retain an attorney could ultimately be seized by the government upon a verdict in its favor via the statute’s “relation back” provision. See 21 U.S.C. § 853(c); Monsanto, 109 S.Ct. at 2660-61 n. 3, 2667; Bissell, 866 F.2d at 1349; Moya-Gomez, 860 F.2d at 720. Thus, issuance of a pretrial protective order should have no effect on a defendant’s ability to retain counsel of choice, for even in the absence of pretrial restraint an attorney is on notice that he will not be able to keep fees collected from assets that are ultimately found forfeited after trial. Monsanto, 109 S.Ct. at 2660-61 n. 3. A pretrial restraint of assets therefore places no greater restriction on a defendant’s choice of counsel than the post-trial forfeiture and relation back provisions upheld by the Supreme Court in Monsanto and Caplin & Drysdale.
Further, when assessing the property interest burdened by § 853 we must bear in mind that the order is temporary and may not ripen into a permanent taking of defendant’s assets until after a full trial on the merits. The Speedy Trial Act, 18 U.S.C. § 3161 et seq. (1988), ensures that such a trial will be held within a reasonable time. See Bissell, 866 F.2d at 1353; United States v. Draine, 637 F.Supp. 482, 485-86 (S.D.Ala.1986), aff'd, 811 F.2d 1419 (11th Cir.), cert. denied, 484 U.S. 827, 108 S.Ct. 94, 98 L.Ed.2d 55 (1987).
The minimal nature of the restraint provided for in § 853 distinguishes it from a similar civil forfeiture provision, 21 U.S.C. § 881(a)(7) (1988). The latter statute was at issue in our recent decision in United States v. The Premises and Real Property at 4492 South Livonia Rd., 889 F.2d 1258 (2d Cir.1989), reh’g denied, 897 F.2d 659 (2d Cir.1990). Livonia held that § 881(a)(7) as applied to the seizure of a home without a hearing was improper. Considering the heightened expectation of privacy and freedom from governmental intrusion in a person’s home, we stated that defendant’s interest in his home was not diminished by an occupancy agreement that allowed him to remain there pending trial since the occupancy was a matter of grace, not of right. See 889 F.2d at 1264-1265. We observed that the government’s interest “may be met by less restrictive means than seizure, for example, by the filing of a lis pendens ... along with a restraining order or bond requirement.” Id. at 1265. The protective order issued in the instant case pursuant to § 853 is precisely the sort of less intrusive measure we endorsed in Livonia. Cf. Monsanto, 109 S.Ct. at 2666 (“Where respondent was not ousted from his property, but merely restrained from disposing of it, the governmental intrusion was even less severe than those permitted by our prior decisions”).
Moreover, the protective order restrains defendant’s property, not his person. The fact that a defendant seeking to be free on bail pending trial is afforded a full adversarial hearing at which the sufficiency of the evidence against him may be considered, 18 U.S.C. § 3142(f), 3142(g)(2) (1988), may not be construed to mean that a similar protection is required when restraint of a person’s property is implicated. Cf. Monsanto, 109 S.Ct. at 2666. The Bail Reform Act, like § 853, is directed at insuring that the subject of the order is present at the time of trial. A defendant at a bail hearing is not permitted to challenge the grand jury’s finding of probable cause supporting the indictment, but is limited to demonstrating that he is not likely to flee pending trial and is not a threat to the safety of the community. Analogously, a defendant contesting the entry of a protective order under § 853 may not challenge *1209the merits of the temporary restraint of his property, but may move to modify the order on the grounds that a less restrictive means would effectively protect the government’s interest. Thus, the private interest of the defendant is adequately safeguarded.
2. Risk of Erroneous Deprivation
Because due process is a flexible concept a less stringent procedural safeguard often may be sufficient to permit a minimal intrusion to withstand constitutional scrutiny and to protect against an erroneous deprivation. See United States v. Eight Thousand Eight Hundred Fifty Dollars ($8,850) in United States Currency, 461 U.S. 555, 564, 103 S.Ct. 2005, 2012, 76 L.Ed.2d 143 (1983); Morrissey v. Brewer, 408 U.S. 471, 481, 92 S.Ct. 2593, 2600, 33 L.Ed.2d 484 (1972). The minimal nature of the intrusion imposed under § 853 has been noted. Because the protective order merely effects the defendant’s ability to transfer his assets — and not their ownership— only where a defendant seeks to sell or alienate them pending trial will there be inconvenience. Here of course the deprivation was not imposed in the absence of any process because a finding of probable cause established by the indictment was necessary to support the restraining order. Cf. Livonia, 889 F.2d at 1264; Musson, 802 F.2d at 386. Thus, prior to issuance of a restraining order a grand jury must have found probable cause showing that the restrained assets are forfeitable. This requirement reduces the risk of an erroneous deprivation.
As noted, the risk of an erroneous restraint of property is irrelevant to a defendant’s ability to retain counsel of choice in light of the statute’s “relation back” provision, see 21 U.S.C. § 853(c); Monsanto, 109 S.Ct. at 2660-61 n. 3; Moya-Gomez, 860 F.2d at 720. As for any other possible hindrances, I believe they are slight in view of the minimal intrusion upon a defendant’s property rights and the district court’s power to fashion a protective order. The district court has discretion to remedy a “clearly improper” order, and to tailor one that restrains assets beyond what is needed to ensure their availability. Senate Report at 203, reprinted in 1984 U.S.Code Cong. & Admin.News 3386; Monsanto, 109 S.Ct. at 2665. For example, were the restrained assets to be the inventory of an ongoing business, defendant’s need to free those assets pending trial, as well as the government’s interest, might be adequately secured by requiring defendant to post a bond.
Finally, the possibility of prosecutorial abuse under § 853 should not weigh heavily in our analysis. As the Supreme Court stated in Caplin & Drysdale in rejecting the same argument, “[cjases involving particular abuses can be dealt with individually by the lower courts, when (and if) any such cases arise.” Id. at 2657.
3. The Government’s Interest
Finally, the government’s interest in an effective forfeiture mechanism must be considered. As outlined in the Senate Report, the Act was aimed at promoting the public policy of combatting racketeering and drug trafficking crimes as effectively as possible. Forfeiture promotes this goal by depriving criminals of their “ill-gotten gains,” by financing a fund to support law-enforcement efforts, and by reducing the economic power of organized crime and drug enterprises. Caplin & Drysdale, 109 S.Ct. at 2654-55. Congressional concerns initially focused on making the protective order easy to obtain to prevent the dissipation of assets prior to conviction. Senate Report at 196, reprinted in 1984 U.S.Code Cong. & Admin.News 3379. Other interests are equally pertinent in the post-restraint, pretrial period. One, of paramount importance, is avoiding the premature disclosure of the prosecution’s case and its trial strategy. Id. A second is the conservation of prosecutorial resources. Id. at 197, reprinted in 1984 U.S.Code Cong. & Admin.News 3380. Given that the burden of proof needed to restrain assets is only one of “probable cause,” Monsanto, 109 S.Ct. at 2666-67, a showing of which is prerequisite to handing down an indictment leading to the initial restraint, a hearing requirement would only burden the prosecution — and possibly jeopardize its case— with the need to establish probable cause a second time and in the presence of the defendant. Far from being equivocal, the legislative history demonstrates that Congress was clearly opposed to opening up the government’s case before trial. Senate Report at 202-203, reprinted in 1984 U.S. Code Cong. & Admin.News 3385-86. Hence, the government interest is strong.
Ill
After balancing these factors, it is plain that the temporary restraint imposed by the protective order is outweighed by the government’s interest in preserving forfei-table assets, maintaining an effective trial *1210strategy, and conserving prosecutorial resources. In cases where an order is improperly drawn to include assets not listed in the indictment, or where utilizing a bond or other mechanism sufficient to protect the government’s interest in the property in lieu of restraining specific assets would save a party from undue hardship, the trial court has ample discretionary authority to modify its order. The grand jury’s initial determination of probable cause, coupled with the court’s authority to limit the protective order to the least intrusive means necessary to protect the government’s interest, provides sufficient due process for defendants whose assets are restrained pending trial.
Accordingly, I vote to withdraw and vacate the prior panel opinion in this case, 836 F.2d 74 (2d Cir.1987), and dissent from the majority’s remand and its direction to the district court to conduct a pretrial hearing.
Order
Feb. 28, 1991.
A petition for rehearing containing a suggestion that the action be reheard in banc having been filed herein by appellant, Peter Monsanto.
Upon consideration by the panel that heard the appeal, it is
Ordered that said petition for rehearing is DENIED.
It is further noted that the suggestion for rehearing in banc has been transmitted to the judges of the court in regular active service and to any other judge that heard the appeal and that no such judge has requested that a vote be taken thereon.
ORDER
April 4, 1991.
The matter of the adequacy of the pretrial hearing conducted by Judge Ward pursuant to the remand in Monsanto I has been referred to the original panel hearing Monsanto I consisting of Oakes, Chief Judge, and Cardamone and Mahoney, Circuit Judges, by the entire court. In light of Judge Ward’s hearing, under the standard of the original panel opinion (probability of convincing the jury beyond a reasonable doubt) and the en banc ruling that “future such hearings shall be governed by a probable cause standard,” U.S. v. Monsanto, 924 F.2d 1186, 1202 (2d Cir.1991) (en banc), Judge Ward’s hearing more than satisfies the requirements of the ultimate en banc ruling.
Moreover, there would be good reason for holding that there has been a waiver of the pre-trial hearing issue by the fact that it was not raised on the direct appeal.
Therefore, the petition for rehearing, insofar as it relates to the adequacy of Judge Ward’s hearing following the original remand, is in all respects denied.1

. While an order has previously been entered denying the petition for rehearing addressed to the en banc court, the issue raised herein has been specially reviewed by the original panel above named and a copy of this order has been circulated to the members of the en banc court, none of whom has interposed any objection thereto.