Topic: Law and Civil Liberties

Big Data Tool For Trump’s Big Government Immigration Plans

During his campaign President Trump made it clear that his administration would strictly enforce immigration law while also seeking to limit immigration. Trump’s executive orders so far are consistent with his campaign rhetoric, including a revitalization of the controversial 287(g) program, threats to withdraw grants from so-called “Sanctuary Cities,” the construction of a wall on the southern border, a temporary ban on immigration from six Muslim-majority countries, and the hiring of 10,000 more Immigration and Customs Enforcement (ICE) agents. Recent reporting reveals that these agents, tasked with implementing significant parts of Trump’s immigration policy agenda, will have access to an intelligence system that should concern all Americans who value civil liberties.

Earlier this month The Intercept reported on Investigative Case Management (ICM), designed by Palantir Technologies. ICE awarded Palantir a $41 million contract in 2014 to build ICM. ICM is scheduled to be fully operational by September of this year.

Here is The Intercept’s breakdown of how ICM works:

ICM funding documents analyzed by The Intercept make clear that the system is far from a passive administrator of ICE’s case flow. ICM allows ICE agents to access a vast “ecosystem” of data to facilitate immigration officials in both discovering targets and then creating and administering cases against them. The system provides its users access to intelligence platforms maintained by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation, and an array of other federal and private law enforcement entities. It can provide ICE agents access to information on a subject’s schooling, family relationships, employment information, phone records, immigration history, foreign exchange program status, personal connections, biometric traits, criminal records, and home and work addresses.

Clarence Thomas Is Skeptical of Civil Asset Forfeiture

Justice Clarence Thomas yesterday signalled that the abusive practice of civil asset forfeiture is ripe for expanded constitutional scrutiny.

The case is Lisa Olivia Leonard v. Texas.  James Leonard (the petitioner’s son) was stopped by police for a traffic infraction in 2013 “along a known drug corridor.”  Police searched Mr. Leonard’s vehicle and discovered a safe containing $201,100 and the bill of sale for a home. Arguing that the money was either proceeds from a drug sale or going to be used in such a sale, the state initiated forfeiture proceedings and took the money.  The safe actually belonged to James’ mother Lisa, who brought suit to protect her property from the government seizure.

The Supreme Court denied certiorari for procedural reasons, but Justice Thomas had some harsh words for civil forfeiture anyway, and suggested that it’s time for the Supreme Court to take another look at the practice:

Civil proceedings often lack certain procedural protections that accompany criminal proceedings, such as the right to a jury trial and a heightened standard of proof.

Partially as a result of this distinct legal regime, civil forfeiture has in recent decades become widespread and highly profitable. And because the law enforcement entity responsible for seizing the property often keeps it, these entities have strong incentives to pursue forfeiture.

This system - where police can seize property with limited judicial oversight and retain it for their own use - has led to egregious and well-chronicled abuses…

Justice Thomas also noted the disparate impact these types of abuses have on the poorest and most vulnerable communities:

These forfeiture operations frequently target the poor and other groups least able to defend their interests in forfeiture proceedings.  Perversely, these same groups are often the most burdened by forfeiture. They are more likely to use cash than alternative forms of payment, like credit cards, which may be less susceptible to forfeiture. And they are more likely to suffer in their daily lives while they litigate for the return of a critical item of property, such as a car or a home.

The opinion goes on to explain that while the court has historically upheld the constitutionality of civil forfeiture, the modern practice of forfeiture has strayed far from its narrow historical use and purpose:

I am skeptical that this historical practice is capable of sustaining, as a constitutional matter, the contours of modern practice, for two reasons.

First, historical forfeiture laws were narrower in most respects than modern ones. Most obviously, they were limited to a few specific subject matters, such as customs and piracy. Proceeding in rem in those cases was often justified by necessity, because the party responsible for the crime was frequently located overseas and thus beyond the personal jurisdiction of the United States courts. These laws were also narrower with respect to the type of property they encompassed. For example, they typically covered only the instrumentalities of the crime (such as the vessel used to transport the goods), not the derivative proceeds of the crime (such as property purchased with money from the sale of the illegal goods).

Second, it is unclear whether courts historically permitted forfeiture actions to proceed civilly in all respects. Some of this Court’s early cases suggested that forfeiture actions were in the nature of criminal proceedings…

Lastly, while agreeing with the Court’s refusal to hear the case for procedural reasons, Justice Thomas nonetheless expressed his interest in taking another look at civil forfeiture:

Whether this Court’s treatment of the broad modern forfeiture practice can be justified by the narrow historical one is certainly worthy of consideration in greater detail.

In his opinion, Justice Thomas refers to the Institute for Justice’s Policing for Profit survey of forfeiture laws around the country, and also to Sarah Stillman’s expose Taken, documenting several instances of forfeiture abuse. Both of those sources are worth reading for a better idea of just how bad the incentives of civil forfeiture are and the abuses that have resulted.  

It’s heartening to have a Supreme Court Justice so squarely acknowledge and raise questions about a predatory government practice that has proceeded unchecked for so long.

One of the most common questions I receive when I talk about civil asset forfeiture is “why does the Supreme Court allow this?” My answer has always been “because these laws predate the country and the court has never seen fit to re-examine them.”  

This opinion is a clear signal that at least one member of the Supreme Court is ready to take a fresh and skeptical look.

The Revised “Travel Ban” Is Much Better Legally

If this new executive order had been what was was signed initially—combined with the normal interagency process and briefing of border officials as to how to implement it—President Trump wouldn’t have provoked the type of political response he did or the legal quagmire he entered. This order is much more narrowly tailored, providing exemptions not just to those with green cards and other valid visas, but also people with significant contacts to United States, students, children, urgent medical cases, and other special circumstances—and Iraq is necessarily treated as a special case—as well as spelling out reasons for the remaining restrictions.

As it stands now, the tweaks in the new executive order would normally put these actions firmly within the executive’s authority under the relevant immigration laws: presidents have broad discretion over refugee programs and to suspend entry of certain classes of foreigners on national security grounds. But, in large part due to the botched development and implementation of the previous order, this isn’t the normal case and courts will likely be less deferential to assertions of executive power here than they would otherwise be.

And then there are the atmospherics of what so many people consider to be a “Muslim ban.” Just because a presidential candidate uses hyperbolic language during a campaign—or his surrogates use similarly inartful language on national TV—doesn’t mean that any policy in that area is constitutionally suspect, but some judges will surely see it that way.

Finally, all that’s before getting into the wisdom of this policy. Refugees generally aren’t a security threat, for example, and it’s unclear whether vetting or visa-issuing procedures in the six remaining targeted countries represent the biggest weakness in our border defenses or ability to prevent terrorism on American soil.

Ending the SEC’s Antique Prosecutions

Since at least the days of ancient Athens—which Demosthenes tells us had a five-year statute of limitations for nearly all cases—governments have limited the time period within which punishment or compensation may be sought. Statutes of limitations exist to protect defendants from vindictive or arbitrary lawsuits and prosecutions brought long after their memories have faded and records that might have been used to rebut a claim lost. They ensure that we need not spend our lives constantly anxious about the possibility of the distant past coming back to haunt us over half-forgotten slights.

These are the basic animating purposes behind 28 U.S.C. § 2462, which imposes on the federal government a five-year limitations period for any “action, suit, or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise,” and the Supreme Court’s unanimous 2013 opinion in Gabelli v. SEC (in which Cato also filed a brief) finding no valid justification for the Securities and Exchange Commission to pursue enforcement actions seeking civil penalties more than five years after the relevant conduct had occurred.

Unfortunately, the SEC didn’t learn its lesson and has consistently attempted to circumvent and subvert Gabelli by arguing that the relief it seeks in its years-overdue enforcement actions—monetary disgorgement, injunctions requiring defendants to obey the law, and declaratory judgments that laws were violated—is actually “equitable” and not a form of civil penalty covered under § 2462. Disgorgement—requiring a defendant to return their ill-gotten gains—has indeed traditionally been a way to remedy unjust enrichment rather than a punishment, but the SEC’s use of it has been anything but equitable.

The agency has brought disgorgement actions not to make the victims of wrongdoing whole, aid in public securities-law enforcement, or encourage private compliance, but to punish unsuspecting defendants for decades-old conduct, destroy their reputations and careers, and score massive financial judgements that go straight to the vaults of the U.S. Treasury rather than the pockets of any victims. When one actually looks at what the SEC is doing in context, it becomes clear that this “equitable” relief is functionally a “civil fine, penalty, or forfeiture, pecuniary or otherwise,” subject to § 2462’s five-year limitations period.

While a careful application of § 2462 is itself sufficient to resolve this case, it is also important to note the serious reasons that actions like those taken by the SEC are in deep opposition to good public policy. Allowing the SEC—an administrative juggernaut more than capable of bringing meritorious claims in a timely manner—to pursue antiquated claims distracts the agency from its stated priorities of pursuing current malfeasance. It also misleads Congress and the public into believing that modern markets are rife with misconduct, in addition to casting a never-ending shadow of potential liability over anyone involved in financial markets.

This is why Cato has filed an amicus brief in support of Charles Kokesh, a man now entangled in the SEC’s stale web, to urge the Court to put an end to the SEC’s gamesmanship and categorically hold that the agency may not institute an enforcement action seeking disgorgement or injunctive/declaratory relief more than five years after the underlying conduct occurred.

The Supreme Court will hear argument in Kokesh v. SEC on April 18, with a decision expected by the end of June.

Race and Redistricting Back In Court: Bethune-Hill v. Va. State Bd. of Elections

The Supreme Court in the 1990s established that “a racially gerrymandered redistricting scheme… is constitutionally suspect” under the Equal Protection Clause. Today’s more-or-less-unanimous decision in Bethune-Hill v. Virginia Board of Elections confirms that the Court is not prepared to back off or cut corners on that principle.

In particular, the Court unanimously found that a district court had been too indulgent in reviewing Virginia officials’ race-conscious drawing of lines for legislative districts. While the Court permits some race-conscious line drawing in order to meet the requirements of the federal Voting Rights Act, this is not a blank check. “Racial gerrymandering, even for remedial purposes, may balkanize us into competing racial factions,” warned Justice Sandra Day O’Connor in the first case in this series, Shaw v. Reno (Shaw I, 1993).

In that 1993 case, O’Connor and her colleagues were reviewing a set of North Carolina districts so bizarre in shape that their tactical purpose could scarcely be denied with a straight face. Today’s ruling clarifies, though there had not been much doubt before, that when there is other evidence of racial motivation, the process does not escape Equal Protection scrutiny just because the shape of districts appears normal and they do not visibly violate other sound principles of districting. 

Justice Alito in a separate and Justice Thomas in a partial concurrence would have applied even tougher scrutiny. Overall, however, the Court spoke with much unity. And that is not something to take for granted on this subject. In both Shaw v. Reno (1993) and Miller v. Johnson (1995), four dissenting Justices from the liberal wing disapproved of Equal Protection scrutiny on varying rationales. In a notably vicious editorial after Shaw I, the New York Times assailed O’Connor personally over what it saw as “a full-scale assault on the Voting Rights Act” intended to “punish” blacks and “sustain all-white politics.” 

Today – despite some academic opinion that still yearns to go back to the days when racial gerrymandering was A-OK when done with suitably progressive motives – all eight sitting members of the Court, liberal wing included, appear content to apply at least the Shaw-Miller level of scrutiny. 

Justice Kennedy wrote today’s opinion, confirming once more that he stands at the center of gravity of today’s Court on redistricting issues. Much of the speculation these days is whether Kennedy is prepared to join the liberal wing in disapproving gerrymandering done for political (typically party- and incumbent-protective), as distinct from racial, motives. By coincidence, for those interested in these issues, I have a chapter in the new 8th edition of Cato’s Handbook for Policymakers on the topic of political gerrymandering, with advice on how best to reduce its prevalence at the state level. 

Not Just the Press

How can unelected judges limit the power of an elected official like the president? Two political scientists offer some answers in The Washington Post.

First, the public should broadly agree “about the basic legitimacy of the procedures used to review the powerful.” Second, the public needs “accurate information about the behavior of public officials.”

The authors say a free press should and does provide that information in various ways. That’s a good answer as far as it goes, but it does not go nearly far enough. Many other parts of our polity have the power and responsibility to provide information about government. To name a few: interest groups, bloggers, think tanks, professors, leakers, labor unions, trade associations, grassroots groups, and many others who might spring to mind with more reflection.

The media does not have a monopoly on informing the public. “The freedom of speech and of the press” belongs to all Americans. This diffusion of power seems especially valuable at a moment when the media lack credibility for so many Americans.

Court: IRS, Unlike Caligula, May Punish Only Under Well-Proclaimed Law

Judge Jeffrey Sutton, writing for a Sixth Circuit panel, has reversed a Tax Court ruling in an opinion [Summa Holdings v. Commissioner of Internal Revenue] beginning thus:

Caligula posted the tax laws in such fine print and so high that his subjects could not read them. Suetonius, The Twelve Caesars, bk. 4, para. 41 (Robert Graves, trans., 1957). That’s not a good idea, we can all agree. How can citizens comply with what they can’t see? And how can anyone assess the tax collector’s exercise of power in that setting? The Internal Revenue Code improves matters in one sense, as it is accessible to everyone with the time and patience to pore over its provisions.

In today’s case, however, the Commissioner of the Internal Revenue Service denied relief to a set of taxpayers who complied in full with the printed and accessible words of the tax laws. The Benenson family, to its good fortune, had the time and patience (and money) to understand how a complex set of tax provisions could lower its taxes.

And taking issue with the IRS Commissioner’s decision to disallow the combined use of two Congressionally approved devices, the Roth IRA and DISC (domestic international sales corporation), in a way said to trigger the so-called substance-over-form doctrine:

Each word of the “substance-over-form doctrine,” at least as the Commissioner has used it here, should give pause. If the government can undo transactions that the terms of the Code expressly authorize, it’s fair to ask what the point of making these terms accessible to the taxpayer and binding on the tax collector is. “Form” is “substance” when it comes to law. The words of law (its form) determine content (its substance). How odd, then, to permit the tax collector to reverse the sequence—to allow him to determine the substance of a law and to make it govern “over” the written form of the law—and to call it a “doctrine” no less.

[cross-posted from Overlawyered]