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Civil Forfeiture Victim Takes Her Fight For Attorneys’ Fees to U.S. Supreme Court

IJ asks Supreme Court to End DOJ’s End Run Around Paying Attorneys’ Fees to Innocent Victims of Civil Forfeiture

Arlington, Va.—On May 11, 2015, Miladis Salgado returned home to find her life turned upside down. While she was at work, police had raided her home and seized her entire life savings—$15,000 in cash she was saving for her daughter—based on a tip that her estranged husband was dealing drugs. He wasn’t, but that didn’t stop the Drug Enforcement Agency (DEA) from filing a civil forfeiture complaint in an attempt to keep Miladis’ money forever.

Miladis was incensed. She’d done nothing wrong, so she decided to fight back against the government. Without any savings, the only way she could afford an attorney was to hire one on contingency. After two years of legal wrangling and countless sleeplessness nights, she won her case. The court was finally about to rule in Miladis’ favor, so the DEA admitted that there was no evidence of a crime and agreed to give back her money, but in doing so, it refused to pay her attorneys’ fees. That meant Miladis would receive $10,000 of her money back, but the remaining $5,000 would go to her attorney, who had represented her in court.

Although the case was dismissed, Miladis decided she wasn’t done fighting until the government returned every single penny it had taken from her, including the money the government had forced her to spend on an attorney. So she petitioned the judge to award her attorneys’ fees, but he refused. The judge said that because the government had returned the money before he ruled on her case, she could not be awarded her attorneys’ fees. It did not matter that the government had waited two years. The federal appeals court agreed.

Today, Miladis has partnered with the Institute for Justice, a nonprofit, public interest law firm, to bring her petition for attorneys’ fees to the U.S. Supreme Court.

“The threat of paying attorneys’ fees is a critical check on government abuse,” said Justin Pearson, a senior attorney at the Institute for Justice. “Otherwise, there is no disincentive to stop prosecutors from filing frivolous civil forfeitures against property belonging to innocent owners like Miladis.”

Pearson continued, “The government can’t take your property, keep it for years, and then suddenly give it back and pretend like nothing happened. Seizing someone’s property and forcing them to hire an attorney for two years to get it back has real costs.”

In 2000, Congress passed the Civil Asset Forfeiture Reform Act (CAFRA) which, among other things, requires the government to pay attorneys’ fees to anyone who challenges a forfeiture in court and wins. The provision was intended to provide a disincentive for the government to file baseless forfeiture lawsuits, but federal prosecutors have gamed the system. When prosecutors realize they may lose in court, they often prolong the case in hopes of forcing a settlement that will allow them to keep part of the innocent owner’s money. But if the innocent owner doesn’t give in, then the prosecutors will voluntarily return the property just before the court rules. In doing so, they deprive the owner of a “win,” and subsequently argue that without a “win,” CAFRA’s fees requirement doesn’t apply.

“By gaming the system and denying property owners a ‘win’ in court, federal prosecutors have found a way to short circuit judicial oversight of their activities, while at the same time preserving their ability to continue to abuse Americans’ property rights,” said IJ Senior Attorney Dan Alban. “This is the equivalent of the government claiming, ‘no harm, no foul,’ when in reality there is very real harm done to the thousands of Americans that challenge civil forfeitures in court.”

Malidis chose to fight for her rights, but most civil forfeiture victims cannot spend years in court fighting to get their property back. In fact, according the Institute for Justice’s report Policing for Profit, 88% of federal civil forfeitures never make it before a judge. In many cases, the cost of hiring an attorney to contest the forfeiture in court is more than the value of their property, so their only real option is to give in to the prosecutor’s settlement demands and then walk away.

The Institute for Justice is no stranger to the government’s strategy of denying victims their day in court and refusing to pay attorneys’ fees. Over the past decade, IJ has challenged illegitimate civil forfeitures across the country. In nearly every case, once IJ became involved, the federal government quickly capitulated and returned the property to IJ’s clients, while at the same time it fought any attempts to recover attorneys’ fees.

This is also not the Institute for Justice’s first time arguing about civil forfeiture at the U.S. Supreme Court. In February, IJ secured a unanimous ruling that the Constitution’s prohibition on excessive fines under the Eighth Amendment limited law enforcement’s ability to use civil forfeiture to seize its client’s automobile after he pleaded guilty to a minor drug offense.

“For more than a decade, IJ has fought to end civil forfeiture once and for all,” said IJ President Scott Bullock. “It is one of the greatest threats to property rights in America today and we are confident that the Supreme Court will continue to reign in this unconstitutional abuse of power.”

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