Posted on April 9, 2009 by Thomas Withers

Jury Orders Fen-Phen Lawyers to Forfeit $ 50 Million

Having returned from a trip to Reno, Nevada last night where I didn’t lose a dime (didn’t bet a dime either), I didn't exactly correctly predict in this post on Saturday that this jury might just reach a compromise in the forfeiture phase of a case.

Following the guilty verdicts on Friday of last week, the jury in the Fen-Phen case in Kentucky returned on Tuesday of this week to hear the forfeiture phase of the case. Although there has been scant reporting on this portion of the case, the jury found the same day, apparently, after just argument, and no additional presentation of evidence, that the two now disbarred lawyers must forfeit $50 million dollars. Although the government had sought the forfeiture of $94.6 million, the jury only found that the defendants, William Gallion and Shirley Cunningham, had to forfeit the $50 million.

Proving that the job of a criminal defense practitioner is a difficult one, Cunningham’s attorney, Steve Dobson, said that although it is hard to be satisfied with anything after a guilty verdict, at least the government didn’t get the $94.6 million they were seeking! I’m pretty sure Dobson’s client thinks that’s a pyrrhic victory.
 

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Posted on May 15, 2008 by Thomas Withers

Eleventh Circuit Holds that Mail Fraud Conviction Authorizes Forfeiture

In affirming the convictions and sentences of Padron for conspiracy to commit mail fraud in violation of 18 U.S.C. § 371 and 4 counts of mail fraud in violation of 18 18 U.S.C. § 1341, the Eleventh Circuit (opinion available here) took up a question not previously addressed in this Circuit – does 28 U.S.C. § 2461(c) authorize criminal forfeiture of specified property in general mail fraud cases. The court noted that Congress enacted 28 U.S.C. § 2461(c), which became effective in August 2000, makes criminal forfeiture available in every case that criminal forfeiture does not reach, but for which civil forfeiture is authorized.

28 U.S.C. § 2461(c), which I had never heard of, provides in pertinent part, that, “If a person is charged in a criminal case with a violation of an Act of Congress for which the civil or criminal forfeiture of property is authorized, the Government may include notice of the forfeiture in the indictment or information pursuant to the Federal Rules of Criminal Procedure. If the defendant is convicted of the offense giving rise to the forfeiture, the court shall order the forfeiture of the property as part of the sentence in the criminal case pursuant to the Federal Rules of Criminal Procedure . . .”

The Eleventh Circuit found that since civil forfeiture was authorized under 18 U.S.C. § 981 for offenses constituting “specified unlawful activity” under 18 U.S.C. § 1956, and mail fraud is defined under section 1956 as a specified unlawful activity, civil forfeiture was authorized. Therefore, since civil forfeiture was authorized, criminal forfeiture for mail fraud convictions was authorized as well.

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