Who Knew Standards of Review Could Be So Sexy?!

The old saw that, "He who writes the rules, wins," was on display in one of the most-discussed civil forfeiture cases in years.

At issue in United States v. $124,7000  in U.S. Currency was whether the money found in Emiliano  Gonzolez's was substantially connected to drug activity.  Under federal law, if the government proves that money was connected to drug activity, then the government can seize the money.

Brief summary of civil forfeiture proceedings.
To seize Gonzolez's money, the government would have to prove to a trial judge that the money, more likely than not, was substantially connected to drug activity.  The government would seek to prove this at trial.  During the trial, the government would call witnesses and present its case much like it would in a criminal prosecution.  The defendant could cross-examine witnesses and also present evidence that the money was not connected to drugs.  After hearing all the evidence, the district court would rule whether he believed the government proved its case.

Appellate issues.
The side that loses can appeal. Because civil forfeiture proceedings are not criminal cases, the Double Jeopardy Clause does not apply.  Thus, the government can appeal when the defendant wins.

Standards of review.
Standards of review are rules that govern appeals. To put things simply: Standards of review determine whether or not the appellate judges will defer to the trial court.  When applying a highly deferential standard of review, abuse of discretion, the court might say: "We disagree with the lower court's ruling.  If we had been the trial court, we would have ruled differently.  But the district could did not abuse its discretion."  In other words, some standards of review allow trial court's to make mistakes without getting reversed.

As you can imagine, what standard of review apply is hotly contested, and can literally determine whether or not you win your appeal.  Thus, one of the issues in U.S. v. $124,700 was what standard of review applied.

Questions of law and mixed questions of fact-and-law are reviewed de novo - zero deference.  Courts apply this standard because they believe that trial court's have no greater expertise over the law than reviewing courts.  Determinations of credibility, however, are reviewed for clear error - which is very deferential.

Courts review credibility calls for clear error because they (rightly) believe that trial court's are in a better position to evaluate whether a witness has told the truth.  The trial court, unlike the appellate court, was able to look the witness in the eye.  And so appellate courts won't reverse a trial court's credibility calls unless it believes that there was no way the judge could have believed the witnesses.  Courts almost never reverse when applying the clear error standard of review.

What standard of review applied in U.S. v. $124,700?
In U.S. v. $124,7000, there were two conflicting narratives - one was supported by inference, the other, by direct testimony. 

The government's narrative went like this: "Gonzalez was found with a lot of money in his car.  Only drug dealers travel with that kind of money.  Plus, he lied about having the money, and about the source of his money.  He also was returned from Chicago - which he flew to on a one-way ticket.  Drug traffickers commonly use one-way tickets. Finally, he returned home via car rental - which was rented by a third-party."  Looking at the evidence, a person would infer that the money was substantially connected to drug activity.

Gonzolez had a different narrative.  He put witnesses on the stand, and took the stand himself.  The witnesses testified that they gave him the money to purchase a refrigerated truck.  He was travelling to Chicago to purchase a truck he needed to start a new business.  He flew on a one-way ticket because he intended to drive the truck home. When he arrived in Chicago, the truck had already been sold.  Thus, he needed a rental car.  Since he, like many recent immigrants, did not have a credit card, he had someone else rent the car for him.  He also said he lied about the source of the money because he was afraid the government would take it away from him.  (A rational fear, in light of what happened!)

After hearing the evidence, the trial court sided with the defendant.  The court noted that the defendant's story was "plausible and consistent."  In light of the court's holding and comments, isn't it safe to assume that the district court made credibility determinations - and thus, clear error would apply?

Yet the split panel of judges found  a and not-a:

The district court’s opinion includes no finding as to the credibility of Gonzolez and the other two claimants. The court did observe that the explanations of the claimants were “plausible and consistent,” but this is different from a finding that the court actually believed the testimony.

How could the trial court find the defendant's story "plausible and consistent" if he didn't believe the defense witnesses?  After all, the defense narrative was based entirely on witness testimony.  How could the narrative be "plausible and consistent" if those telling the narrative were not also "consistent"?

Imagine your son or daughter misses curfew.  Your child said her car broke down on the side of the road and she had to call AAA.  Like a good parent, you ask why she missed curfew.  You probe.  You look for holes in the story.  Finally, you say, "Your story is plausible and consistent.  Thus, you're not grounded."

How in the world could you have reached that conclusion had you not believed your daughter?  It would be impossible to not believe your daughter was telling the truth, while also finding your daughter's story plausible and consistent.  Your daughter's credibility was the story.

As you can see, the appellate court should have reviewed the case applying the clear error standard of review.

Would the case have turned out differently?  I think so, but I've gone on long enough.

Comments

[Whiskey Juvenile]

Something can be plausible, consistent, yet ultimately untrue. That is, all the defenses' testimony could be plausible (it's possible that they pooled their money to get the truck) and consistent (they all testified that the money was for the truck, and their actions were consistent with buying the truck), but the trial court could disbelieve their testimony nevertheless (and hold that the acts are also plausible and consistent with drug-related activity, and that the evidence leads to the conclusion that, more likely than not, the acts were indeed related with drug activity), due to the particular circumstances that accompany personal observation of witness testimony that is entirely absent on a transcript, which is incidentially why trial determinations of factual issues are given great deference upon appeal. However, it would seem to me that given this interpretation of the language of the District Court's opinion, the proper result would be for the 6th Circuit to vacate and remand for the District Court to explicitly make the factual determination, i.e., that the defense's testimony was "plausible, consistent, and credible", not for appellate court to insert itself into the factfinding process.

Jurisprudence on standards of review is dangerous territory in which to tread, but it seems to me that as a matter of evidentiary review, the 6th Circuit reached the wrong result from its otherwise justifiable reasoning. On the other hand, this could have been avoided had the trial judge not used inartful language that failed to precisely convey the ruling intended.

[KipEsquire]

Great analysis.

Having said that, I think more people are concerned with the very concept of the government "posing" as a civil plaintiff via a forfeiture action for no other reason than to circumvent the "beyond a reasonable doubt" standard at the trial court level.

Stated differently, most people would have been just as indignant had Gonzolez lost at trial and lost on appeal as they are over his having won at trial and then losing on appeal.

But good stuff -- thanks.

[Sarcasm Incarnate]

Not a lawyer, so might be out of my element here, but to me the deciding factor is simple...the man was not charged with any crime. If the gov does not have enough evidence to even rate attempting to charge Gonzales with a crime, they cannot possibly have any more evidence that the money he carried was involved with or tied to a crime. This is simply theft on the part of the government.

[mythago]

Sarcasm, that's not the way the law works, sadly.

[Dave]

What do you want to bet that Washington, Jefferson, Madison, and Franklin are spinning in their graves. I think if they could see us today they would be ashamed to have had anything to do with creating our government and more ashamed of us for putting up with it.

[Aaron]

I believe that it was President Washington who signed the first U.S. civil forfeiture bill into law, way back in 1789.