Monday, July 13, 2009
No Refund for Money Paid Out in Sting, Court Rules
By SHERRI M. OKAMOTO, Staff Writer
A Syrian national who attempted to purchase false immigration documents from an undercover agent and was later deported was not entitled to a refund of the $40,000 he had paid for the forged alien registration cards, the Ninth U.S. Circuit Court of Appeals ruled Friday.
The panel held that the doctrine of in pari delicto prevented Abdul Masih Kardoh from obtaining the court system’s assistance in recovering money voluntarily paid in furtherance of an illegal contract.
In 2004, Kardoh, then residing unlawfully in the U.S. on an expired tourist visa, was the subject of an investigation by the Department of Homeland Security, Immigration and Customs Enforcement, based on information that he was seeking to acquire immigration documents.
He was introduced to an undercover agent posing as a corrupt immigration official and allegedly told the agent on multiple occasions that he wanted to purchase alien registration cards for himself and others. Kardoh eventually purchased a card with his name on it for $12,500 from the agent, and in a separate transaction, purchased a card for another Syrian national also living in the U.S. unlawfully on an expired tourist visa for $15,000.
The undercover agent said in his declaration that he later provided Kardoh with four alien registration cards bearing the identity of four Syrian nationals not legally entitled to the cards nor entitled to enter the United States, in exchange for $40,000.
He further asserted that Kardoh was aware the transaction was illegal and that the cards had been obtained illegally.
About two months after Kardoh’s arrest, he was deported, having never been indicted. As the government never initiated forfeiture proceedings, Kardoh’s attorney asked the government to return the $40,000 to him, but the government declined.
Kardoh then filed a motion with the district court under Rule 41(g) of the Federal Rules of Criminal Procedure, seeking an order that the $40,000 be returned.
U.S. District Judge Vaughn R. Walker of the Northern District of California found that he could exercise equitable jurisdiction over the motion and that the money should be returned to Kardoh.
Absent a forfeiture proceeding, investigation or prosecution, Walker said the continued retention of the $40,000 was unreasonable, as Kardoh had no legal process to protect his interest in the money.
But Ninth Circuit Judge Richard R. Clifton, citing case law from the D.C., Third and Eighth Circuits, said Kardoh could not seek recovery of money he had indisputedly paid voluntarily to a government agent in an illegal transaction.
“The general rule, in its full Latin glory, is ‘in pari delicto potior est conditio defendentis,’ or ‘[i]n case of equal fault the condition of the party defending is the better one,’” Clifton wrote, reasoning that allowing Kardoh to recover property he voluntarily surrendered as part of his attempt to violate the law would violate longstanding public policy.
While the district judge had recognized the in pari delicto doctrine, Walker had declined to apply it because Kardoh had not been convicted of a criminal offense. But Clifton explained that a conviction is not required to establish the illegality of a transaction.
“It is to be expected that in most cases of this kind the government will undertake criminal prosecutions or forfeiture proceedings, but the failure to do so does not automatically mean that a claimant’s motion for return of property must be granted,” Clifton said.
And absent any showing of bad faith, the fact that the government elected to deport Kardoh rather than to prosecute him did not deprive him of due process, Clifton added.
Because there were no criminal proceedings pending, Clifton said Kardoh’s motion should have been treated as a civil complaint and the government’s opposition was therefore the equivalent of a motion for summary judgment.
As Kardoh offered no evidence to rebut the agent’s declaration, Clifton concluded there was no genuine issue as to any material fact and the government was entitled to judgment as a matter of law.
Senior Judge Procter Hug Jr. and visiting Judge Glenn L. Archer of the Court of Appeals for the Federal Circuit joined Clifton in his decision.
The case is Kardoh v. United States, 07-15700.
Copyright 2009, Metropolitan News Company