Legal News

Forfeiture and the Sixth Amendment: From Drug to White-Collar Cases?

By Dan Slater

Is the Sixth Amendment’s right to counsel violated when the government seizes a defendant’s assets pre-trial? It’s an issue in drug cases, but it’s also now an issue in white collar case, as Kerri Kaley, a former Johnson & Johnson saleswoman, and her husband face charges of selling unwanted surgical supplies on the gray market. Here’s the story from the Daily Business Review.

“The Kaleys simply want to use their own money to retain counsel of choice to defend them at trial,” said one of their attorneys, Howard Srebnick of Black Srebnick Kornspan & Stumpf in Miami. “The government is interfering by freezing their assets, including the equity in the home they purchased more than a decade ago, without giving the Kaleys an opportunity pre-trial to confront witnesses and present evidence to establish they have committed no crime.” The Kaleys, according to the report, set aside about $1 million to pay attorneys by taking out a second home mortgage and cashing certificates of deposit. But prosecutors claimed the money was ill-gotten gains. They charged Kerri Kaley stored the medical equipment in the family’s garage.

Srebnick and co-counsel appealed the decision last June by a U.S. District judge freezing the Kaleys’ assets without a probable cause hearing. They argue — among other things — that the couple’s Fifth Amendment right to due process and Sixth Amendment right to counsel were violated. The government opposed the probable cause hearing, reportedly not wanting to show too much of its hand before trial.

AUSA’s Anne R. Schultz and Madeleine R. Shirley argue that the Kaleys have no right to use funds slated for forfeiture to retain counsel. The defendants were fortunate to receive an evidentiary hearing in front of the magistrate, the prosecutors argue.

Miami criminal defense lawyer Jane Moscowitz, who’s representing Miami criminal defense lawyer Ben Kuehne against money laundering charges, says that bad rulings in drug cases “eventually come and pollute the prosecution of white-collar cases.”

Full post as published by Law Blog - WSJ.com on May 27, 2008 (boomark / email).