High Court Eliminates Joint and Several Liability Among Co-Conspirators

On June 5, the U.S. Supreme Court handed down a decision that will impact sentencing in virtually every criminal case that involves multiple defendants (or multiple conspirators) and the imposition of an order of forfeiture. The decision will likely present opportunities for defendants who have already been sentenced to revisit the forfeiture judgments entered against them. The case, Honeycutt v. United States, examined “whether 21 U.S.C. Section 853(a)(1) mandates joint and several liability among co-conspirators for forfeiture of the reasonably foreseeable proceeds of a drug conspiracy.” While Honeycutt dealt specifically with a drug conspiracy, the court’s decision impacts defendants in any criminal case in which the district court has authority to order forfeiture because 18 U.S.C. Section 982, the general forfeiture provision, incorporates Section 853 by reference. Therefore, the court’s decision regarding the joint and several liability of co-conspirators impacts nonnarcotics types of cases as well, such as those cases involving white-collar offenses such as wire fraud and program fraud. Honeycutt overturns precedent in the U.S. Court of Appeals for the Third Circuit, which had previously held that district courts must enter forfeiture judgments holding defendants jointly and severally liable for all of the foreseeable acts of the conspirators in United States v. Pitt, 193 F.3d 751, 765 (3d Cir. 1999) (“21 U.S.C. Section 853(a)(1) imposes joint and several liability with respect to forfeiture”).

Prior to the Honeycutt decision, when a defendant was convicted of a crime where forfeiture was appropriate, courts were required to enter an order of forfeiture for “any property constituting, or derived from, any proceeds the person obtained, directly or indirectly, as the result of such violation.” Until very recently, every court of appeals interpreted the language of Section 853(a)(1) in this way. This interpretation led to the imposition of joint and several liability for all defendants involved in a conspiracy, regardless of the role or the amounts actually obtained by a defendant. Because each defendant was required to repay a judgment for all property received by any co-conspirator, large forfeiture judgments were being entered against defendants whose role in a conspiracy was marginal and who received only a small portion of the conspiracy’s proceeds.