Justices Mull Government's Power to 'Beggar' Defendants
When the government freezes the money that an indicted criminal defendant needs to hire a lawyer, he or she should be able to challenge that indictment during a pretrial hearing, a Miami attorney argued to the U.S. Supreme Court on Wednesday.
"I ask that this Court not rule that the government can beggar a defendant into submission," urged Howard Srebnick of Miami's Black, Srebnick, Kornspan & Stumpf. "I ask this Court not to rule that the government can impoverish someone without giving them a chance to be heard through their counsel of choice."
The criminal defense bar's frustration with the government's power to obtain a court order freezing assets following a grand jury indictment spilled over in briefs and arguments before the justices in Kaley v. U.S.
Kerri and Brian Kaley are asking the justices whether the Fifth and Sixth Amendments require a post-indictment hearing during which a criminal defendant may challenge the evidence supporting the grand jury's decision.
At the end of an hour of spirited arguments by one of the government's top lawyers—deputy solicitor general Michael Dreeben—and Srebnick, the high court appeared divided, and not in the usual ideological way.
Chief Justice John Roberts Jr. and justices Sonia Sotomayor and Stephen Breyer appeared concerned about what Roberts called the government's "overweening power" in the grand jury process and the right of a criminal defendant to retain counsel of choice. And justices Ruth Bader Ginsburg, Samuel Alito and Antonin Scalia questioned whether a pretrial hearing that challenged the underlying grand jury decision would undermine the grand jury process, become a fishing expedition by the defense and place judges in untenable positions.
Wednesday's arguments stemmed from what Roberts called "a complicated case."
In January 2005, the Kaleys found they were targets of a federal grand jury investigation in the Southern District of Florida. Kerri Kaley was a sales representative for a subsidiary of Johnson & Johnson. Her husband owned a construction business. The government claimed that the Kaleys and other Johnson & Johnson sales representatives were taking used prescription medical devices from hospitals that had purchased them from Johnson & Johnson and were reselling them on the gray market.
The Kaleys retained counsel to represent them during what became a two-year investigation. When settlement talks failed, they applied for a $500,000 line of credit on their home to pay their lawyers for a trial. They used the line of credit to purchase a certificate of deposit. In 2007, they deposited an additional $63,000 into the CD from other income earned.
In February 2007, the Kaleys, along with another sales representative, were indicted for conspiring to traffic in stolen prescription medical devices and money laundering. The indictment included a forfeiture count and the government obtained an ex parte order that froze only the Kaleys' assets, including their home and the CD.