United States v. Hanratty
25-211 mtn
| 2d Cir. | Jul 21, 2025Background
- John Hanratty appealed an interlocutory order from the Southern District of New York denying his motion to vacate a post-indictment restraining order (PIRO) freezing assets in two investment funds (Ebury Fund 1 and 2) allegedly controlled by him.
- The PIRO was entered pursuant to 18 U.S.C. § 982 and 21 U.S.C. § 853, based on probable cause that the funds contained proceeds from wire and bank fraud and money laundering offenses for which Hanratty was indicted.
- Hanratty argued the asset freeze prevented him from using the funds for his criminal defense, violating his constitutional rights.
- The Ebury Funds were already subject to a separate state court injunction barring use of assets except for certain narrow purposes.
- Hanratty did not claim that the PIRO prevented his actual legal representation; his counsel had been allowed to represent him via appointment to the CJA Panel with fee reimbursement.
- The District Court had granted Hanratty’s counsel's request to receive CJA funding for both prospective and outstanding legal fees, allowing continued representation.
Issues
| Issue | Hanratty's Argument | Government's Argument | Held |
|---|---|---|---|
| Whether the PIRO violated Hanratty's right to counsel by freezing assets needed for his legal defense | The PIRO unlawfully restricted funds Hanratty needed to retain his preferred counsel, infringing his rights | Hanratty could not show the PIRO affected his counsel of choice, since the funds were already frozen by state order and counsel was provided otherwise | PIRO did not violate the right to counsel; Hanratty failed to show injury |
| Whether the district court lacked statutory authority to enter the PIRO | The court had no statutory basis for freezing the funds | The order was statutorily permitted under cited federal forfeiture statutes | Did not reach the issue, as Hanratty lacked standing |
| Whether the district court erred in entering the PIRO even if authorized | The order was unjustified even if statutory authority existed | Probable cause was established and procedures were followed | Did not reach the issue, as Hanratty lacked standing |
| Whether Hanratty was deprived of due process | The asset freezes impaired his substantive due process rights | No impairment since other means of legal representation available and no right was infringed | No due process violation found |
Key Cases Cited
- Wheat v. United States, 486 U.S. 153 (addressing the right to counsel of choice in criminal cases)
- United States v. Bonventre, 720 F.3d 126 (Second Circuit standard on whether asset restraints affect right to counsel)
- Caplin & Drysdale, Chartered v. United States, 491 U.S. 617 (distinguishing when asset freezes infringe upon right to select counsel)
- United States v. Monsanto, 924 F.2d 1186 (en banc) (asset freezes and defendants' access to counsel)
- United States v. O’Neil, 118 F.3d 65 (addressing when attorney compensation issues rise to the level of constitutional concern)