United States v. Patel
949 F. Supp. 2d 642
W.D. Va.2013Background
- Patel seeks pretrial release of substitute assets from a protective order tied to a $20.9M forfeiture in a contraband cigarette trafficking and money laundering case.
- The government asserts the $20.9M represents the cigarette purchase price and proceeds traceable to the offenses, subject to civil/criminal forfeiture.
- A Farmer hearing occurred to assess probable cause and asset restraining issues, including substitute assets under 21 U.S.C. § 853(p).
- The court previously found probable cause for restraint up to $20.9M and held substitute assets may be restrained when necessary to preserve forfeitable property.
- Patel argues double-counting via laundered proceeds and seeking net profits rather than gross proceeds; the government disputes these assessments.
- The central dispute is whether pretrial restraint of substitute assets is permissible and whether it violates the Sixth Amendment right to counsel.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Probable cause for the $20.9M forfeiture | Patel argues the amount is inflated by laundered proceeds and double-counts | Patel contends net proceeds should be used and laundered funds reduce the amount | Probable cause found; $20.9M deemed a conservative measure of proceeds |
| Applicability of § 853(p) to substitute assets in civil forfeiture | Patel argues substitute assets cannot be restrained pretrial in civil forfeiture | Patel contends substitution not properly applicable to civil forfeiture context | § 853(p) applies to substitute assets in both civil and criminal forfeiture contexts |
| Pretrial restraint of substitute assets violates the Sixth Amendment | Patel contends restraints hinder payment of counsel | Government argues no Sixth Amendment right to fund counsel from forfeitable assets | Pretrial restraint upheld; no Sixth Amendment right to use forfeitable assets for counsel given probable cause |
| Effect of Billman/Najjar framework on pretrial restraint | Patel relies on Najjar to constrain restraint where no evasion shown | Government relies on Billman and Monsanto to justify restraint to preserve forfeiture | Fourth Circuit standards permit pretrial restraint of substitute assets under § 853(p) where probable cause exists and tainted assets are not otherwise locatable |
Key Cases Cited
- Caplin & Drysdale v. United States, 491 U.S. 617 (U.S. 1989) (Sixth Amendment right to counsel not violated by asset forfeiture; no right to spend government funds for counsel)
- Monsanto Co. v. United States,, 491 U.S. 600 (U.S. 1989) (Pretrial restraint of assets does not require attorney- fee funding exception)
- Billman, 915 F.2d 916 (4th Cir. 1990) (Pretrial restraint of substitute assets permitted where tainted assets pursued; extends to forfeiture context)
- Alamoudi, 452 F.3d 310 (4th Cir. 2006) (CAFRA mechanics; substitute assets permissible when tainted property beyond reach)
- Bollin, 264 F.3d 391 (4th Cir. 2001) (Pretrial restraint of substitute assets affirmed under analogous statute)
- McHan, 345 F.3d 262 (4th Cir. 2003) (Relation-back principle; substitute assets subject to forfeiture under §853(p))
- Day, 524 F.3d 1361 (D.C. Cir. 2008) (Civil/criminal forfeiture mirror image; §2461(c) bridge for substitution)
- Kalish, 626 F.3d 165 (2d Cir. 2010) (Supports treating §853/§2461 interplay as coterminous)
- Jarvis, 499 F.3d 1196 (10th Cir. 2007) (Pretrial restraint issues in substitute assets within forfeiture context)
- Field, 62 F.3d 246 (8th Cir. 1995) (Refusal to permit pretrial restraint of substitute assets under §853(e)(1))
- Gotti, 155 F.3d 144 (2d Cir. 1998) (Pretrial restraint principles in forfeiture)
- Vampire Nation, 451 F.3d 189 (3d Cir. 2006) (CAFRA interpretation; §2461 as bridge)