Asset Forfeiture

Indiana Supreme Court Applies Eighth Amendment to Curb "Oppressive" Asset Forfeitures

The ruling is a continuation of the same case in which the federal Supreme Court ruled that the Excessive Fines Clause of the Eighth Amendment is "incorporated" against state governments and applies to asset forfeitures.

|The Volokh Conspiracy |

Asset forfeiture.

In February, in the case of Timbs v. Indiana, a unanimous Supreme Court ruled that the Excessive Fines Clause of the Eighth Amendment applies to state and local governments (as well as the federal government) and that it constrains civil asset forfeitures. Civil asset forfeiture policies enable law enforcement agencies to seize property that they suspect might have been used in a crime—including in many cases where the owner has never been convicted of anything, or even charged. Abusive forfeitures are a a widespread problem that often victimizes innocent people and particularly harms the poor. The scale of this legalized robbery is staggering. In some years, federal law enforcement alone seizes more property through asset forfeiture than burglars steal throughout the nation.

The Timbs decision could potentially lead to tighter constraints on asset forfeiture. But the Supreme Court left one key issue unaddressed: what qualifies as an "excessive" fine in the asset forfeiture context? The federal Supreme Court remanded that question to the Indiana Supreme Court, from which the case had been appealed to the federal Supreme Court in the first place. Earlier this week, the Indiana court issued a decision laying criteria for what qualifies as "excessive." Nick Sibilla of the Institute for Justice (the public interest law firm that represented the property owner before both the federal and state supreme courts), has a helpful summary in an article in Forbes:

To determine if a forfeiture would be "grossly disproportional" and unconstitutional under the Excessive Fines Clause, the Indiana Supreme Court devised a three-factor test. First, Hoosier courts will now have to consider the "harshness of the punishment," which may include considering if the forfeiture would remedy the harm cause by the offense and to what extent, as well as property's value and role in the offense.

Judges will also need to determine what effect forfeiting the property would have on the owner. After all, courts already consider a person's economic resources when it comes to levying court costs and civil punitive damages.

"The owner's economic means—relative to the property's value—is an appropriate consideration," Chief Justice Rush wrote. "To hold the opposite would generate a new fiction: that taking away the same piece of property from a billionaire and from someone who owns nothing else punishes each person equally."

Second, courts in Indiana must determine the "severity of the offense," which includes examining statutory penalties, the sentence imposed, and the harm cause by the crime. Finally, judges will also be required to consider an owner's culpability and "blameworthiness for the property's use as an instrumentality of the underlying offenses." A forfeiture may be unconstitutionally excessive "if a claimant is entirely innocent of the property's misuse."

This test is likely to significantly curb abusive forfeitures in the state of Indiana, particularly in cases where the owner is in fact innocent of any crime, but merely had the misfortune of owning a car or other property that someone else allegedly used in the commission of some offense. The court emphasized that "if a claimant is entirely innocent of the property's misuse, that fact alone may render a use-based… fine excessive."

The court points out that "in recent decades, the absence of certain shields against the oppressive use of civil forfeiture has encouraged the widened use of aggressive in rem for forfeiture practices." This decision will help change that.

At least for the moment, the new test will only apply in Indiana courts. But, as  the first state supreme court ruling on the subject to follow the federal Supreme Court's decision in this same case, it could influence future decisions on the subject in other state and federal courts.

The latest iteration of Timbs comes on the heels of several other court cases enforcing constitutional constraints on asset forfeiture, including a South Carolina state court decision striking down that state's civil asset forfeiture law and a federal court decision invalidating Albuquerque, New  Mexico's system as a violation of the Due Process Clause of the Fourteenth Amendment.

While a great deal of progress has been made through both judicial decisions and legislative reform, the struggle against asset forfeiture is far from over. Much work remains to be done.

Among other things, state-level reforms can often be circumvented by then-Attorney General Jeff Sessions' 2017 revival of the federal "equitable sharing" program, under which state and local asset forfeitures are "adopted" by the federal government.  The feds then share the proceeds with state law enforcement agencies—even in cases where state law otherwise prevents the latter from profiting from seized assets.

The Indiana Supreme Court decision may not even completely resolve the long-running case of Tyson Timbs' land rover, the property at issue in this litigation, which has now dragged on for some six years. The state supreme court did not decide the issue of how its three-factor test applies to Timbs' case, an issue that will now be resolved by the trial court, if the state continues its efforts to hold on to the vehicle. Prosecutors are still deciding whether they intend to keep pursuing the issue.

If they do choose to continue their Javert-like quest to keep the Land Rover, it seems highly likely that Timbs will prevail. The car is worth over $40,000, which is vastly disproportionate to the $10,000 maximum fine for Timbs' offense of transporting some $400 worth of heroin that he planned to sell.

NOTE: Tyson Timbs is represented by the Institute for Justice, a prominent public interest law firm, with which I have longstanding connections, and for which I have done pro bono work on other property rights cases. I did not, however, have any involvement in this particular case.

 

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