Indy officials face lawsuit alleging misuse of civil forfeiture funds

Update:

A week after Marion County Prosecutor Terry Curry and other Indianapolis law enforcement officials were sued for civil forfeiture practices, Curry issued a statement saying he believes the forfeiture procedures his agency utilized "comply with all existing legal precedent."

"Fundamentally, we believe profits gained by criminal activity are appropriately forfeited for the public benefit and use," Curry said.

Institute for Justice, a Virginia-based national nonprofit, filed a civil lawsuit in Marion Superior Court that aims to invalidate a state statute that allows police and prosecutors to deduct law enforcement costs from forfeited funds as a type of reimbursement. The group claims it's a violation of the Indiana Constitution, which says that all, not some, forfeited dollars must be deposited into a fund intended for schools.

Earlier story, Feb. 9, 2016:

For several months, Jack and Jeana Horner did not have their two vehicles, and they did not know why or where they had been taken.

Law enforcement officials seized the Horners' 2008 Jeep Grand Cherokee and 2003 Ford F150 in August 2013, after they suspected that Jeana Horner's son, who was borrowing the vehicles, used them to transport marijuana. Jack and Jeana Horner, who did not know about the drugs and did not face any criminal charges, spent more than nine months trying to get their vehicles back.

The Horners exemplify an ongoing problem with civil forfeiture in Marion County, said Sam Gedge, an attorney for a national nonprofit group that is now suing city and law enforcement officials in Indianapolis.

The lawsuit, which was filed today by the Institute for Justice on behalf of the Horners and four other plaintiffs, aims to invalidate a state statute that allows police and prosecutors to deduct law enforcement costs from forfeited funds as a type of reimbursement. Any remainder goes to the Common School Fund, which is used to build schools. But Gedge said the statute violates the Indiana Constitution, which says that all, not some, forfeited funds must be deposited into the school fund.

A 2014 IndyStar review of cases found that asset forfeiture laws crafted to fight organized crime, such as drug cartels and money laundering groups, sometimes snare people facing minor drug possession charges, or no charges at all. People like the Horners are forced to engage in sometimes lengthy legal battles to get back their homes, cars and savings.

"What happened was wrong. That shouldn't happen to anybody," said Jeana Horner, of Greenfield. "They took our vehicles and wouldn't even tell us that they had them, and they kept them from us. We got no answers."

In some cases, police seize cars, homes � with no charges filed

The lawsuit, filed in Marion Superior Court, names Marion County Prosecutor Terry Curry, Mayor Joe Hogsett, Public Safety Director David Wantz, Indianapolis Metropolitan Police Department Chief Troy Riggs, the prosecutor's office and the city of Indianapolis as defendants.

A spokeswoman for the prosecutor's office said the agency has no comment because Curry has not had the opportunity to review the complaint. The other defendants named in the suit, as well as Ted Nolting, IMPD's legal adviser and an attorney for the city's Office of Corporation Counsel, have not returned calls and emails seeking comment.

The state law in question is interpreted differently by each county. Some meticulously account for the investigative costs and send the remaining dollars to the school fund. Many do not put money into the school fund. In Marion County, forfeited funds are divided between the law enforcement agency and the prosecutor's office, according to court records.

According to memorandums of agreement between the agencies, the prosecutor's office gets 30 percent of forfeited funds. The remaining 70 percent goes to IMPD or to the Metro Drug Task Force, a group of officers from Marion and neighboring counties, depending on which law enforcement body is involved in an investigation.

Such a scenario, the complaint says, "gravely misconstrued" what should be considered law enforcement costs.

Indianapolis law enforcement officials say asset forfeiture is a tool that allows them to target criminal organizations, and forfeited funds are a small portion of their budgets but are an important source of revenue to train officers and purchase vehicles and equipment. The Metro Drug Task Force in Indianapolis, for instance, is funded almost entirely by forfeited dollars. In an earlier interview with IndyStar, Curry said his agency uses the money to pay for the salaries and benefits of deputy prosecutors who specialize in forfeiture cases.

Officials also say forfeited funds do not fully cover their investigative costs.

According to the complaint, Marion County law enforcement agencies received an average of $888,112 in forfeited funds annually from 2003 to 2010. That number reached about $1.5 million in 2011, the complaint says.

The Virginia-based Institute for Justice considers the practice policing for profit, which "creates a dangerous incentive for police and prosecutors to seize people's property," Gedge said.

The lawsuit names four other plaintiffs who are challenging the practice.

In the Horners' case, Jeana said she and her husband did not know why their vehicles were taken until after a civil forfeiture lawsuit was filed against them. For several months, her husband, who has pulmonary fibrosis and is disabled, had to ask family members to drive him around to several doctors' appointments. Eventually, the couple bought a car for $2,500.

Jeana Horner said her son hired a lawyer for $10,000 to handle the civil case. The following year, in 2014, the court ruled in the Horners' favor, but it took three weeks before they got their vehicles back, and one had been drained of its oil, Jeana Horner said.

The Class D felony possession charge against her son, who was on a work release program when he was charged, was eventually dropped, court records show.

In Indiana, law enforcement can seize people's property without having to charge or convict someone. State law requires law enforcement officials to show that the property, more likely than not, was used to commit a crime.

In other states, such as Montana and New Mexico, a person must be convicted of a crime before his or her property is taken.

The Institute for Justice recently filed a similar lawsuit in New Mexico. The group claims that despite recent legislation outlawing civil forfeiture in the state, law enforcement agencies continue to seize property without a conviction.

Call IndyStar reporter Kristine Guerra at (317) 444-6209. Follow her on Twitter: @kristine_guerra.