Kaley v. United States
571 U.S. ___ (2014)

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Justia Opinion Summary
After a grand jury indicted the Kaleys for reselling stolen medical devices and laundering the proceeds, the government obtained a restraining order against their assets under 21 U.S.C. 853(e)(1), to “preserve the availability of [forfeitable] property” while criminal proceedings are pending. An order is available if probable cause exists to think that a defendant has committed an offense permitting forfeiture and the disputed assets are traceable or sufficiently related to the crime. The Kaleys moved to vacate the order, to use disputed assets for their legal fees. The district court allowed them to challenge traceability to the crimes but not the facts supporting the underlying indictment. The Eleventh Circuit and Supreme Court affirmed. In challenging a section 853(e)(1) pre-trial seizure, an indicted defendant is not entitled to contest the grand jury determination of probable cause to believe the defendant committed the crimes. A probable cause finding sufficient to initiate prosecution for a serious crime is conclusive and, generally, a challenge to the reliability or competence of evidence supporting that finding will not be heard. A grand jury’s probable cause finding may effect a pre-trial restraint on a person’s liberty or property. Because the government’s interest in freezing potentially forfeitable assets without an adversarial hearing about the probable cause underlying criminal charges and the Kaleys’ interest in retaining counsel of their own choosing are both substantial, the issue boils down to the “probable value, if any,” of a judicial hearing in uncovering mistaken grand jury probable cause findings. The legal standard is merely probable cause, however, and the grand jury has already made that finding; a full-dress hearing will provide little benefit.

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued.The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader.See United States v. Detroit Timber & Lumber Co., 200 U. S. 321 .

SUPREME COURT OF THE UNITED STATES

Syllabus

KALEY et vir v. UNITED STATES

certiorari to the united states court of appeals for the eleventh circuit

No. 12–464. Argued October 16, 2013      —Decided February 25, 2014

Title 21 U. S. C. §853(e)(1) empowers courts to enter pre-trial restraining orders to “preserve the availability of [forfeitable] property” while criminal proceedings are pending. Such pre-trial asset restraints are constitutionally permissible whenever probable cause exists to think that a defendant has committed an offense permitting forfeiture and that the assets in dispute are traceable or otherwise sufficiently related to the crime charged. United States v. Monsanto, 491 U. S. 600 .

          After a grand jury indicted petitioners, Kerri and Brian Kaley, for reselling stolen medical devices and laundering the proceeds, the Government obtained a §853(e)(1) restraining order against their assets. The Kaleys moved to vacate the order, intending to use a portion of the disputed assets for their legal fees. The District Court allowed them to challenge the assets’ traceability to the offenses in question but not the facts supporting the underlying indictment. The Eleventh Circuit affirmed.

Held: When challenging the legality of a §853(e)(1) pre-trial asset seizure, a criminal defendant who has been indicted is not constitutionally entitled to contest a grand jury’s determination of probable cause to believe the defendant committed the crimes charged. Pp. 5–21.

     (a) In Monsanto, this Court held that the Government may seize assets before trial that a defendant intends to use to pay an attorney, so long as probable cause exists “to believe that the property will ultimately be proved forfeitable.” 491 U. S., at 615. The question whether indicted defendants like the Kaleys are constitutionally entitled to a judicial re-determination of the grand jury’s probable cause conclusion in a hearing to lift an asset restraint has a ready answer in the fundamental and historic commitment of the criminal justice system to entrust probable cause findings to a grand jury. A probable cause finding sufficient to initiate a prosecution for a serious crime is “conclusive[e],” Gerstein v. Pugh, 420 U. S. 103 , and, as a general matter, “a challenge to the reliability or competence of the evidence” supporting that finding “will not be heard,” United States v. Williams, 504 U. S. 36 . A grand jury’s probable cause finding may, on its own, effect a pre-trial restraint on a person’s liberty. Gerstein, 420 U. S., at 117, n. 19. The same result follows when it works to restrain a defendant’s property.

     The Kaleys’ alternative rule would have strange and destructive consequences. Allowing a judge to decide anew what the grand jury has already determined could result in two inconsistent findings governing different aspects of one criminal proceeding, with the same judge who found probable cause lacking presiding over a trial premised on its existence. That legal dissonance could not but undermine the criminal justice system’s integrity, especially the grand jury’s constitutional role. Pp. 5–12.

     (b) The balancing test of Mathews v. Eldridge, 424 U. S. 319 —which requires a court to weigh (1) the burdens that a requested procedure would impose on the government against (2) the private interest at stake, as viewed alongside (3) “the risk of an erroneous deprivation” of that interest without the procedure and “the probable value, if any, of [the] additional . . . procedural safeguar[d],” id., at 335—if applicable here, tips against the Kaleys. Because the Government’s interest in freezing potentially forfeitable assets without an adversarial hearing about the probable cause underlying criminal charges and the Kaleys’ interest in retaining counsel of their own choosing are both substantial, the test’s third prong is critical. It boils down to the “probable value, if any,” of a judicial hearing in uncovering mistaken grand jury probable cause findings. But when the legal standard is merely probable cause and the grand jury has already made that finding, a full-dress hearing will provide little benefit. See Florida v. Harris, 568 U. S. ___, ___. A finding of probable cause to think that a person committed a crime “can be [made] reliably without an adversary hearing,” Gerstein, 420 U. S., at 120, and the value of requiring additional “formalities and safeguards” would “[i]n most cases . . . be too slight,” id., at 121–122. The experience of several Circuits corroborates this view. Neither the Kaleys nor their amici point to a single case in two decades where courts, holding hearings of the kind they seek, have found the absence of probable cause to believe that an indicted defendant committed the crime charged. Pp. 12–20.

677 F. 3d 1316, affirmed and remanded.

     Kagan, J., delivered the opinion of the Court, in which Scalia, Kennedy, Thomas, Ginsburg, and Alito, JJ., joined. Roberts, C. J., filed a dissenting opinion, in which Breyer and Sotomayor, JJ., joined.

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