United States v. Bassett, Crim. No. M-85-0541.

CourtUnited States District Courts. 4th Circuit. United States District Court (Maryland)
Writing for the CourtJAMES R. MILLER, Jr.
Citation632 F. Supp. 1308
PartiesUNITED STATES of America v. Ronald Burnell BASSETT, Clarence Meredith.
Docket NumberCrim. No. M-85-0541.
Decision Date11 April 1986

632 F. Supp. 1308

UNITED STATES of America
v.
Ronald Burnell BASSETT, Clarence Meredith.

Crim. No. M-85-0541.

United States District Court, D. Maryland.

April 11, 1986.


Breckinridge L. Willcox, U.S. Atty., and Harvey Eisenberg, Asst. U.S. Atty., Baltimore, Md., for plaintiff.

Ronald Rubinstein, Kew Gardens, N.Y., for defendant Bassett.

Leslie A. Stein, Baltimore, Md., for defendant Meredith.

MEMORANDUM AND ORDER

JAMES R. MILLER, Jr., District Judge.

The defendants Ronald Bassett and Clarence Meredith have moved for an order exempting the fees they are paying their attorneys to represent them in this case

632 F. Supp. 1309
from forfeiture to the government pursuant to 21 U.S.C. §§ 848, 853, and 881 (Paper No. 416). The defendants contend that forcing their lawyers to forfeit their fees violates the defendants' constitutional right to counsel of choice; creates a potential conflict of interest between lawyer and client; undermines the attorney-client privilege and poses a threat to the adversary system (id.)

The government argues that the constitutional right to counsel of choice is a qualified right which must give way to the public interest if need be. Further, the government contends forfeiture does not bar defendants from paying their lawyers with assets earned through legitimate enterprises. Finally, the government asserts that the legislative history of the statute indicates Congress did not intend to exempt legal fees from the forfeiture provision (Paper No. 437 at 12-14).

Factual Background

Defendants Ronald Bassett and Clarence Meredith have been charged with conducting a continuing criminal enterprise under 21 U.S.C. § 848 in connection with a conspiracy to possess and distribute heroin. Mr. Bassett was also charged with interstate travel in aid of distributing heroin, possession with intent to distribute heroin and distribution of heroin. Mr. Meredith was also charged with intent to distribute and distribution of heroin and income tax violations (Paper No. 261). On January 27, 1986, Assistant United States Attorney Ty Cobb advised counsel for both defendants by letter that the government intended to seek forfeiture after trial of the legal fees paid to them by these defendants in connection with this matter (Paper No. 416, Exh. 1).

As a result, both attorneys have requested the court to exempt their fees from forfeiture. The lawyers have indicated that their continued appearance in this case is conditioned on their fees being exempt from forfeiture (Paper No. 416, Rubinstein Affidavit, ¶ 5).

A hearing on this matter took place on April 3, 1986. For the reasons herein stated, the motion of the defendants will be granted.

Legal Analysis

The Comprehensive Crime Control Act of 1984, Pub.L. 98-473, 98 Stat. 1837 (Oct. 12, 1984), altered existing criminal forfeiture law so as to permit the government to obtain from convicted criminals those assets earned through certain illegal activities even if those assets a) have been transferred to third parties; and b) were transferred to third parties prior to conviction. In other words, the criminal forfeiture "relates back" to the commission of the illegal act which "gives rise to the forfeiture." (Justice Department Guidelines on Forfeiture of Attorneys' Fees, 38 Crim.L.Rep. No. 1, 3001 (hereinafter "Justice Department Guidelines")).

The relevant question here is whether the statute's third party forfeiture provisions apply to bona fide legal fees paid by the defendants to their attorneys. Few courts have yet had the opportunity to consider this question in light of the new criminal statute. Two courts which have examined it pursuant to the forfeiture provision of 18 U.S.C. § 1963(m), which is part of the Racketeer Influenced and Corrupt Organizations (RICO) statute and is identical to the forfeiture provision of the drug statute at issue here, have held that attorneys' fees and costs were exempt from forfeiture. United States v. Ianniello, S 85 Cr. 115 (CBM) slip op. (S.D.N.Y. Sept. 3, 1985) Available on WESTLAW, DCTU data base; United States v. Rogers, 602 F.Supp. 1332 (D.Colo.1985).

Another court in the Southern District of New York considered the issue in the context of a motion to quash a Rule 17(c) subpoena and also determined that attorneys' fees could not be forfeited to the government. United States v. Badalamenti, 614 F.Supp. 194 (S.D.N.Y.1985). In the case of In re Grand Jury Subpoena Duces Tecum Dated Jan. 2, 1985, 605 F.Supp. 839, 849 n. 14 (S.D.N.Y.1985), rev'd

632 F. Supp. 1310
on other grounds, 767 F.2d 26 (2d Cir. 1985), the court in dicta in a lengthy footnote reached the opposite conclusion and said such fees were subject to forfeiture

Several other courts, including the Fourth Circuit, indicated in dicta in decisions reached prior to the enactment of the new forfeiture statute, that if faced with the question at that time they might have permitted attorney fee forfeiture. See United States v. Raimondo, 721 F.2d 476, 478 (4th Cir.1983), cert. denied, Bello v. United States, ___ U.S. ___, 105 S.Ct. 133, 83 L.Ed.2d 74 (1984); United States v. Long, 654 F.2d 911, 915-17 (3d Cir.1981). Apparently, however, this is a question of first impression in this District and in the Fourth Circuit.

a) Threshold Issue — Standing and Ripeness

The defendants assert they have standing to challenge the government's intention to seek the forfeiture of the fees they pay to their lawyers (Paper No. 416, Memorandum at 2). The government has not addressed this issue.

Generally, a plaintiff cannot "rest his claim to (judicial) relief on the legal rights or interest of third parties." Secretary of State of Maryland v. Joseph H. Munson Co., 467 U.S. 947, 104 S.Ct. 2839, 2846, 81 L.Ed.2d 786 (1984) quoting Warth v. Seldin, 422 U.S. 490, 499, 95 S.Ct. 2197, 2205, 45 L.Ed.2d 343 (1975). To establish standing, a party wishing to invoke the authority of the court must show he has suffered a real or threatened injury which is fairly traceable to the challenged action and able to be remedied by the court. Chesapeake Bay Foundation v. Bethlehem Steel Corp., 608 F.Supp. 440, 444 (D.Md.1985). Thus, when actions affecting a third party impact adversely on the rights of a party to the action, that party has standing to assert his own rights. United States v. Rogers, 602 F.Supp. at 1335 citing Taylor v. Louisiana, 419 U.S. 522, 526, 95 S.Ct. 692, 695, 42 L.Ed.2d 690 (1975).

Here, the defendants assert their constitutional right to counsel of choice will be impaired if the government is allowed to force forfeiture of their attorneys' legal fees. Clearly, the defendants have standing to assert this claim.

Although not raised by the parties in the pleadings, the question also arises whether the case is sufficiently ripe for decision. Although the government has not actually instituted forfeiture proceedings against these lawyers, it has made it clear that it intends to do so. Moreover, the lawyers in this case have stated that their continued participation in this case is contingent upon their receiving a favorable determination of this matter now. Thus, the defendants face the possibility of being without counsel less than two months before going to trial on extremely serious charges with potentially severe penalties. Therefore, the adverse consequences to the defendants of the government's announced intention is immediate, not an ephemeral potentiality. The issue is ripe for immediate resolution and demands immediate attention from the court.

b) Statutes at Issue and Congressional Intent

The relevant provisions of the applicable forfeiture statutes read as follows:

"§ 848. Continuing criminal enterprise
(a) Penalties; forfeitures
Any person who engages in a continuing criminal enterprise shall be sentenced to a term of ... and to the forfeiture prescribed in section 853 of this chapter;....
§ 853. Criminal forfeitures
(a) Property subject to criminal forfeiture
Any person convicted of a violation of this subchapter or subchapter II of this chapter punishable by imprisonment for more than one year shall forfeit to the United States, irrespective of any provision of State law —
(1) any property constituting, or derived from, any proceeds the person
632 F. Supp. 1311
obtained, directly or indirectly as the result of such violations;
(2) any of the person's property used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of, such violation; and
(3) in the case of a person convicted of engaging in a continuing criminal enterprise in violation of section 848 of this title, the person shall forfeit, in addition to any property described in paragraph (1) or (2), any of his interest in, claims against, and property or contractual rights affording a source of control over, the continuing criminal enterprise.
The court, in imposing sentence on such person, shall order, in addition to any other sentence imposed pursuant to this subchapter or subchapter II of this chapter, that the person forfeit to the United States all property described in this subsection. In lieu of a fine otherwise authorized by this part, a defendant who derives profits or other proceeds from an offense may be fined not more than twice the gross profits or other proceeds.
(b) Meaning of term "property"
Property subject to criminal forfeiture under this section includes —
(1) real property, including things growing on, affixed to, and found in land; and
(2) tangible and intangible personal property, including rights, privileges, interests, claims, and securities.
(c) Third party transfers
All right, title, and interest in property described in subsection (a) of this section vests in the United States upon the commission of the act giving rise to forfeiture under this section. Any such property that is subsequently transferred to a person other than the defendant may be the subject of a special verdict of forfeiture and thereafter shall be ordered
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15 practice notes
  • U.S. v. Monsanto, No. 436
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • January 29, 1988
    ...801 F.2d 1463, 1475-77 (5th Cir.1986) (Rubin, J., concurring); Cloud, 1987 Wis.L.Rev. at 50 n. 237. See also United States v. Bassett, 632 F.Supp. 1308, 1316 (D.Md.1986) ("Although the 'relation back' aspect of the forfeiture statute is only triggered by conviction, the practical effect is ......
  • U.S. v. Moya-Gomez, MOYA-GOMEZ
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • September 30, 1988
    ...that a defendant has standing to raise the issues Estevez raises here." Estevez, 645 F.Supp. at 870 (citing United States v. Bassett, 632 F.Supp. 1308 (D.Md.1986)). While the district judge held that Orlando was free to expend his own funds to pay counsel, id. at 872, he also commented that......
  • United States v. Nichols, No. 86 CR-0146J.
    • United States
    • United States District Courts. 10th Circuit. United States District Court of Utah
    • March 2, 1987
    ...States v. Estevez, 645 F.Supp. 869 (E.D.Wis.1986); United States v. Figueroa, 645 F.Supp. 453 (W.D.Pa.1986); United States v. Bassett, 632 F.Supp. 1308 (D.Md.1986); United States v. Reckmeyer, 631 F.Supp. 1191 654 F. Supp. 1547 (E.D.Va.), 786 F.2d 1216 (4th Cir.), aff'd on other grounds, ce......
  • Caplin Drysdale, Chartered v. United States, No. 87-1729
    • United States
    • United States Supreme Court
    • June 22, 1989
    ...and stakes high, that problem is exacerbated. "Despite the legal profession's commitment to pro bono work," United States v. Bassett, 632 F.Supp. 1308, 1316 (Md.1986), aff'd on other grounds sub nom. United States v. Harvey, 814 F.2d 905 (CA4 1987), even the best intentioned of attorneys ma......
  • Request a trial to view additional results
14 cases
  • U.S. v. Monsanto, No. 436
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • January 29, 1988
    ...801 F.2d 1463, 1475-77 (5th Cir.1986) (Rubin, J., concurring); Cloud, 1987 Wis.L.Rev. at 50 n. 237. See also United States v. Bassett, 632 F.Supp. 1308, 1316 (D.Md.1986) ("Although the 'relation back' aspect of the forfeiture statute is only triggered by conviction, the practical effect is ......
  • U.S. v. Moya-Gomez, MOYA-GOMEZ
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • September 30, 1988
    ...that a defendant has standing to raise the issues Estevez raises here." Estevez, 645 F.Supp. at 870 (citing United States v. Bassett, 632 F.Supp. 1308 (D.Md.1986)). While the district judge held that Orlando was free to expend his own funds to pay counsel, id. at 872, he also commented that......
  • United States v. Nichols, No. 86 CR-0146J.
    • United States
    • United States District Courts. 10th Circuit. United States District Court of Utah
    • March 2, 1987
    ...States v. Estevez, 645 F.Supp. 869 (E.D.Wis.1986); United States v. Figueroa, 645 F.Supp. 453 (W.D.Pa.1986); United States v. Bassett, 632 F.Supp. 1308 (D.Md.1986); United States v. Reckmeyer, 631 F.Supp. 1191 654 F. Supp. 1547 (E.D.Va.), 786 F.2d 1216 (4th Cir.), aff'd on other grounds, ce......
  • Caplin Drysdale, Chartered v. United States, No. 87-1729
    • United States
    • United States Supreme Court
    • June 22, 1989
    ...and stakes high, that problem is exacerbated. "Despite the legal profession's commitment to pro bono work," United States v. Bassett, 632 F.Supp. 1308, 1316 (Md.1986), aff'd on other grounds sub nom. United States v. Harvey, 814 F.2d 905 (CA4 1987), even the best intentioned of attorneys ma......
  • Request a trial to view additional results

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