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New limits proposed for civil forfeiture

October 4, 2017

After a federal judge ruled part of Indiana’s civil forfeiture framework unconstitutional, state lawmakers are now reviewing proposed legislation to bring that framework in compliance with federal mandates and prosecutors’ suggestions.

At its second meeting on Sept. 21,members of the Interim Study Committee on Courts and the Judiciary were presented with draft legislation that proposed several changes to Indiana’s civil forfeiture statute. The committee considered reform at its first meeting in August, when representatives from the Indiana Prosecuting Attorneys Council and the Office of the Indiana Attorney General spoke in support of the existing framework and its constitutionality.

But in a decision in the case of Leroy Washington v. Marion County Prosecutor, et al., 1:16-cv-02980, which was handed down just two days after the committee’s initial meeting, Chief Judge Jane Magnus-Stinson of the U.S. District Court for the Southern District of Indiana struck down a portion of the existing civil forfeiture statute as unconstitutional. Specifically, Magnus-Stinson entered a permanent injunction against the enforcement of Indiana Code 34-24-1-1(a)(1), as read in conjunction with statutory provisions of the same chapter, because it allowed law enforcement to seize vehicles without a “post-seizure, pre-forfeiture hearing.”

Such a deprivation was a violation of Fifth and 14th Amendment due process protections, the chief judge ruled. David Bausman, legislative director for the attorney general’s office, told the committee his office had filed a notice of appeal of that ruling.

Though the attorney general’s office and the Indiana Prosecuting Attorneys Council believed the existing civil forfeiture framework was constitutional, they did provide a handful of suggestions for ways to improve the forfeiture process. Many of those suggestions, coupled with the findings Magnus-Stinson made in her August ruling, found their way into the proposed legislation drafted.

For example, the draft bill would require prosecuting attorneys to file a civil forfeiture complaint within 21 days after the property owner demands its return, down from the current 90-day timeframe. Marion County Prosecutor Terry Curry and Delaware County Prosecutor Jeff Arnold suggested that time reduction at the committee’s initial meeting.

If the owner does not make a demand for the property, the proposed language calls for a complaint to be filed within 90 days, down from the current 180-day period. But if either the 21-day or 90-day windows expires without any forfeiture action filed, then the draft language calls for the seized property to be returned to the owner.

The proposed legislation also tracks the prosecutors’ suggestions for disbursement of forfeiture proceeds to their offices and law enforcement. Current law calls for prosecutors to determine the amount of costs incurred during a forfeiture and to seek reimbursement for that specific amount, but the proposed legislation would automatically divert one-third of the proceeds to the prosecutor’s forfeiture fund after any attorney fees for outside counsel are paid.

Then, except as provided in Section (D) of the proposed 34-24-1-4 regarding disbursement of the proceeds — which calls for 85 percent of the remaining funds to be deposited into a law enforcement general fund if the seized property was used as part of an act of terrorism — 85 percent of the remaining amount would be deposited in the state’s general fund, the general fund of the law enforcement unit that performed the seizure, or a county law enforcement fund “established for the support of the drug task force.” Any remaining funds would then be deposited in the common school fund.

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IPAC Executive Director David Powell spoke in support of the proposed legislation for distributing forfeiture proceeds at the Sept. 21 meeting, telling committee members that there is a lot of guesswork involved with the current requirement for prosecutors to determine the amount of expenses they incur during a forfeiture action. The proposed percentage-based distribution framework removes that guesswork, Powell said.

To remedy the issues Magnus-Stinson found with the existing civil forfeiture framework, the proposed legislation includes language requiring prosecutors to file a probable cause affidavit within seven days of a seizure. If the court does not find probable cause for the seizure after that affidavit is filed, then the property must be returned to the owner of record. But if probable cause is determined, then the prosecutor must notify the owner of record of their right to file a petition for provisional release within seven days of that determination.

“Innocent owners,” or people whose property was seized when they didn’t know it was being used for illegal activity — such as a man who lends his car to a friend without knowing the friend is transporting drugs — also have additional protections in the proposed legislation. Specifically, those innocent owners can file a petition for provisional release pending the final forfeiture determination, as long as the owners can prove, among other things, that they had no reason to believe their property would be used for illegal activity. However, the court can place restrictions on the owners if provisional release is granted, such as limiting how many miles can be put on the car while the final forfeiture action is pending.

The draft legislation also includes a provision that relieves owners from the responsibility of paying for storage, transportation or maintenance costs if the seizure does not end in a forfeiture. Curry had proposed such a revision to the committee at its August meeting after concerns were raised about charging people fees related to unwarranted civil forefeiture actions.

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To avoid concerns about unjust enrichment, the proposed legislation ends with a section that prohibits a deputy prosecuting attorney from serving as outside counsel in a forfeiture action.

The language also prohibits prosecutors and deputy prosecutors from receiving a contingency fee for their work on a civil forfeiture action while also placing limits on the amount of money outside counsel may collect through contingency fees while working on a forfeiture.

While Powell indicated that IPAC supported the revisions laid out in the proposed legislation, Kristin Casper, legislative liaison for the Indiana Public Defender Council, offered suggestions for additional revisions. For example, she called for the probable causing hearing to be adversarial in nature, rather than ex parte.

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Casper additionally expressed some concern about language that requires prosecutors to file a report with IPAC after a forfeiture action has been filed with the court. That report — which includes information about the date the property was seized, the nature of the property, the amount seized and whether the forfeiture was filed in state or federal court, among other items — should be filed with an independent third party, rather than IPAC, she said. However, Casper did note that the proposed legislation overall represented a positive step in the civil forfeiture reform process.

Further, Allen Circuit Judge Tom Felts, a member of the committee, suggested the draft legislation include a specific timeframe in which courts must hold a probable cause hearing. However, Sen. Rod Bray, a Martinsville Republican and attorney who chairs the committee, expressed concern about whether placing a time restriction on judges when courts already have very busy calendars was a wise idea. Felts agreed that would be an issue, so judges would likely need to decide whether a specific probable cause deadline could fit into their schedules.•

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