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On The Front Lines

Rutherford Asks U.S. Supreme Court to Prohibit Government Use of Asset Forfeiture to Deny Citizens Access to a Defense Attorney of Their Choosing

WASHINGTON, D.C. — In weighing in on a case that, if not reversed, could undermine the Sixth Amendment’s guarantee of a right to counsel in criminal cases, The Rutherford Institute is asking the U.S. Supreme Court to prohibit the government from using aggressive asset forfeiture tactics to strip American citizens of the funds needed to hire a defense attorney of their choosing.

In an amicus curiae brief filed in Luis v. United States, Rutherford Institute attorneys argue that a government freeze on the untainted assets of someone charged with (but not yet convicted of) a crime, when those assets are not connected to illegal activity, amounts to a forfeiture of property of a kind that the Founding Fathers rejected and should therefore be prohibited as unconstitutional. As one appellate lawyer noted, “It is unseemly and unjust for the government to impoverish those it prosecutes in order to disable their defense at trial.”

“If the government can arbitrarily freeze, seize or lay claim to your property (money, land or possessions) under government asset forfeiture schemes, you have no true rights,” said constitutional attorney John W. Whitehead, president of The Rutherford Institute and author of Battlefield America: The War on the American People. “Protecting their property from governmental abuse was just as vital to the Founding Fathers as preserving their lives and liberties, hence the Fifth Amendment. What makes this particular case so critical is that if the government is allowed to freeze a person’s untainted—i.e., legitimate—assets, the government can essentially render them penniless and unable to hire an attorney of their choosing in order to preserve their life and liberty, which renders the Sixth Amendment utterly useless.”

The case arose after the government, suspecting Medicare fraud, froze $45 million in assets belonging to Sila Luis, who operated healthcare businesses that provided services for homebound patients in Florida. In October 2012, the federal government indicted Luis alleging that she was involved in schemes to pay illegal kickbacks for patient referrals and to bill Medicare for unnecessary services. Although the government alleged the businesses received $45 million in Medicare reimbursements and sought to recover that full amount in the criminal prosecution, evidence showed that the businesses earned at least $15 million in untainted funds from sources other than Medicare. At the same the indictment was filed, the government brought a civil action seeking to freeze all of Luis’s personal assets, employing a federal statute that gives courts the authority to restrain the assets of those accused of certain kinds of fraud before trial and before any finding of guilt. The freeze applied not only to Luis’s assets traceable to the alleged offenses but also to other “untainted” personal assets.

Luis’s lawyers objected to the proposed freeze asserting that any such order would interfere with her ability to retain counsel of her choice, violating the Sixth Amendment. They also argued that Luis’s right to due process would be violated if the freeze were based solely on the hearsay of confidential informants. However, the district court granted the government’s request to freeze Luis’s untainted assets, ruling that they were as much “contraband” as assets derived from the alleged criminal activity. On appeal, this ruling was summarily affirmed. Luis sought review in the U.S. Supreme Court, which agreed to hear the case in June. In weighing in on the case, Rutherford Institute attorneys have asked the Court to reverse the lower court ruling and free the assets for use by Luis in defending the charges against her.

Affiliate attorneys Anand Agneshwar, Carl S. Nadler, Anna K. Thompson and Emily M. May of Arnold & Porter, LLP assisted The Rutherford Institute in advancing the arguments in the amicus brief before the U.S. Supreme Court.

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