Institute for Justice Will Appeal Ruling in Challenge to Indiana’s System of Contingency Fee Forfeitures

ARLINGTON, Va.—Yesterday afternoon, Judge James R. Sweeney II of the U.S. District Court for the Southern District of Indiana rejected a class-action challenge to Indiana’s system of for-profit prosecutors. Unlike every other state in the nation, Indiana farms out civil-forfeiture prosecutions to private lawyers on a contingency-fee basis. By design, the arrangement gives the private prosecutor a personal financial

stake in the cases he or she prosecutes. Forfeit more, earn more. Forfeit less, earn less. A leading forfeiture treatise describes the state’s “institutionalized bounty hunter system” as a “scandal.”

Representing Amya Sparger-Withers and a class of hundreds, the Institute for Justice (IJ) sued to challenge Indiana’s contingency-fee forfeiture scheme as inconsistent with due process. In yesterday’s ruling, the district court upheld the system. “[T]o argue that a prosecutor becomes too zealous when motivated by a contingent fee,” the court reasoned, “is to deny the basic premise of the adversary system.” Historically, the court added, “there was no belief that the prosecutor . . . in a criminal case had any special duty to justice in the abstract.”

“Yesterday’s decision breaks not just with the reasoning of courts across the nation, but with the views of the U.S. Department of Justice,” said IJ Senior Attorney Sam Gedge. “Every forfeiture defendant has the right to a prosecutor who is financially disinterested and whose incentive is to do justice, not turn a profit. We look forward to the court of appeals’ reviewing the case.”  

Civil forfeiture remains big business in Indiana, with the incentives skewed toward personal benefit, not justice. Each year, private prosecutors pocket hundreds of thousands of dollars in fees. And the distorting effects are obvious. The Department of Justice, for example, admonishes that “[n]o prosecutor’s or sworn law enforcement officer’s employment or salary shall be made to depend upon the level of seizures or forfeitures he or she achieves.” The National District Attorneys Association warns that “[s]alaries and personal benefits of any person influencing or controlling the selection, investigation, or prosecution of forfeiture cases must be managed in such a way that employment or salary does not depend upon the level of seizures or forfeitures in which they participate.” The NDAA’s National Prosecution Standards likewise advises that “factors that may not be considered in setting compensation” include “[r]evenues generated by the prosecution function—such as asset forfeitures or collection of fees.” Simply, prosecutors wield enormous power. And in our justice system, there must be no question that they are exercising that power in the public’s interest—not for personal gain.

“In America, prosecutors cannot have a personal financial stake in the cases they prosecute,” said IJ Attorney Mike Greenberg. “As law-enforcement agencies nationwide recognize, for-profit prosecutions distort prosecutorial incentives and delegitimize the justice system.”

IJ is the leading defender of civil-forfeiture victims, representing people in court, highlighting the many problems with civil forfeiture through strategic research, and advocating for the abolition of civil forfeiture in legislatures. In Los Angeles, IJ recently won a class-action lawsuit against the FBI over the agency’s raid of—and its attempt to forfeit the contents of—hundreds of security deposit boxes. IJ also is litigating a class-action lawsuit against the Drug Enforcement Administration and Transportation Security Administration over searches and seizures at airports. In 2020, IJ released the latest edition of its leading research report outlining the many abuses of civil forfeiture nationwide.

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 To arrange interviews on this subject, journalists may contact Phillip Suderman, IJ’s Communications Project Manager, at [email protected] (850) 376-4110. More information on the case is available at: https://ij.org/case/indiana-civil-forfeiture-class-action/

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