Supreme Court Hears Argument on Criminal Forfeiture Procedure

On February 27, 2024, the Supreme Court heard oral argument in United States v. McIntosh, a case dealing with the procedure for imposing an order of forfeiture in a criminal case.

Rule 32.2(b)(2)(B) provides that “unless doing so is impractical, the court must enter [a] preliminary order of forfeiture sufficiently in advance of sentencing to allow the parties to suggest revisions or modifications before the order becomes final as to the defendant under Rule 32.2(b)(4).”

Rule 32.2(b)(4)(B) provides in turn that the court “must include the forfeiture when orally announcing the sentence or must otherwise ensure that the defendant knows of the forfeiture at sentencing.”

In United States v. McIntosh, 58 F.4th 606 (2nd Cir. 2023), the Second Circuit held that the court’s failure to comply with the former rule — that is, the failure to enter a preliminary order of forfeiture prior to sentencing — is not fatal because the rule is a “time-related directive.”  But in United States v. Maddux, 37 F.4th 1170, 1178 (6th Cir. 2022), the Sixth Circuit held that the failure to comply with the latter rule — that is, not entering an order that was final as to the defendant until after sentencing — was fatal because the rule is a “claims-processing” rule.

Finally, in United States v. Lee, 77 F.4th 565 (7th Cir. 2023), the Seventh Circuit attempted to reconcile these opposing views by adopting both approaches: Rule 32.2(b)(2)(B), the court said, is a “time-related directive,” the violation of which is not fatal, while Rule 32.2(b)(4)(B), is a claims-processing rule that, if violated, renders any forfeiture order entered after sentencing invalid.

As the Seventh Circuit recognized, McIntosh and Maddux are not actually in conflict: one deals with the preliminary order of forfeiture and the other with the oral announcement of the forfeiture as part of the defendant’s sentence.  Nevertheless, the Supreme Court granted cert. in McIntosh to resolve what the Seventh Circuit characterized as the “procedural snarl” that ensues when trial judges fail to comply with the rules.   Accordingly, the question presented does not make a distinction between the before-sentencing context of Rule 32.2(b)(2)(B) and the at-sentencing context of Rule 32.2(b)(4)(B).  Rather, it is simply, “Whether a district court may enter a criminal forfeiture order outside the time limitations set forth in Rule 32.2, Fed.R.Crim.P.?”

Indeed, while the Solicitor General made it clear in the oral argument on February 27 that the Government appreciated the distinction between Rules 32.2(b)(2) and (b)(4), none of the justices alluded to it in their questions.  Rather, the tone of the argument suggested that the Court might view both rules in the same way.

The following is the transcript of the oral argument, followed by the summaries and commentary on the McIntosh, Maddux, and Lee decisions that appeared in the Money Laundering and Forfeiture Digest.   For information on subscriptions to the Digest, click here.

McIntosh Argument

United States v McIntosh Summary and Comment

United States v Maddux Summary and Comment

United States v. Lee Summary and Comment