Fifth Amendment - double jeopardy and the dangerous drug tax.

• Author: Hildy, John
• Position: Supreme Court Review - Case Note

1. INTRODUCTION

   In Department of Revenue of Montana v. Kurth Ranch,(1) the Supreme Court addressed whether the punitive nature of Montana's Dangerous Drug Tax constituted a second punishment for double jeopardy purposes.(2) The Court held that the standard it announced five years earlier in United States v. Halper(3) for determining whether a civil penalty constituted a second punishment did not apply in the case of a tax.(4) Nonetheless, the Court found that Montana's Dangerous Drug Tax violated the prohibition against double jeopardy because the Act had an obvious deterrent purpose and imposed a high tax rate predicated on the commission of a crime based on goods which the taxpayer no longer possessed.(5)

   The Court left open the possibility that the State of Montana could assess a tax of the same or even greater magnitude under its statutory scheme if brought in the same proceeding as the criminal sanction.(6) It further left open the possibility that, if the tax preceded the criminal prosecution, the Double Jeopardy Clause would bar the criminal prosecution.(7) This particularly unsatisfying result raises the question of whether there is a better analysis to apply than double jeopardy.

   This Note explains the confusion surrounding the multiple punishment and multiple prosecution aspects of traditional double jeopardy protection. Then, this Note argues that the Supreme Court inappropriately expanded the scope of the Double Jeopardy Clause by ignoring the distinction between multiple punishments and prosecutions to compensate for some of the Clause's limitations. This Note then concludes that the Supreme Court did not need to expand double jeopardy protection, because other areas of the Constitution already adequately compensate for these limitations. The Court could have achieved more satisfying and practical results by first acknowledging the limits of Double Jeopardy protection, and then turning to the Excessive Fines Clause for additional protection.

2. BACKGROUND

   1. DRUG TAXES GENERALLY

      Essentially, a drug tax allows the government to collect from the "taxpayer," in a civil action, an amount which it calculates as a function of the street value of the substances in the taxpayer's possession or a flat fee per unit of the substance. Until 1969, the federal government taxed the transfer of marijuana pursuant to the Federal Marijuana Tax Act.(8) In Leary v. United States,(9) however, the Supreme Court declared certain provisions of the Act unconstitutional on self-incrimination grounds(10) and set the stage for the Act's repeal in 1970. Many states implemented their own versions of the federal drug tax, but carefully structured their legislation to avoid the self-incrimination problems that led to the downfall of the federal tax.(11)

      At least twenty-six states have, at one time or another, enacted some form of a dangerous drug tax.(12) These tax provisions usually take one of three forms: (1) tax stamps; (2) excise taxes; or (3) licensing fees.

      Tax stamps constitute the most popular method of assessing the drug tax. Under this scheme, the dealer must purchase stamps prior to any sale and affix them to the packaging of the product.(13) Most systems allow the dealer to make the stamp purchase anonymously.(14) Enforcement actions following non-compliance under these schemes have the potential to raise considerable amounts of revenue.(15)

      Unlike tax stamps, excise taxes(16) offer no mechanism for advance payment. In fact, one particular state imposes the tax only after the state convicts the drug dealer.(17) Finally, two states have imposed an occupational licensing fee on drug dealers.(18) In addition to the licensing fee, such states also impose a tax. Nevada allows the drug dealer to purchase the license anonymously.(19)

   2. HISTORY OF DOUBLE JEOPARDY AND ATTACKS AGAINST DRUG TAXES

      The Double Jeopardy Clause of the Fifth Amendment to the United States Constitution provides that "[n]o person shall be subject for the same offense to be twice put in jeopardy of life or limb."(20) The United States Supreme Court has interpreted this clause to prohibit both multiple prosecutions and multiple punishments.(21) A multiple prosecutions violation might occur, for example, where after an acquittal for murder, a prosecutor sought to try the same defendant for manslaughter. A multiple punishments violation, on the other hand, might occur where the sentencing court imposed both fine and imprisonment, but the legislature had only authorized one or the other. Each of these prohibitions protects a distinct interest.(22)

      The protection against multiple prosecutions assures the finality of the first prosecution.(23) As the Court noted in Green v. United States,(24) the multiple prosecutions prohibition prevents a state from making "repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity ...."(25) On the other hand, the prohibition against multiple punishments protects the defendant's interest in avoiding multiple penalties by ensuring that the penalty imposed does not exceed that which the legislature has authorized.(26)

      Until recently, the Supreme Court frequently ignored the distinction between these two interests.(27) As a result, much of the double jeopardy jurisprudence remains jumbled and haphazard.(28) Prior to Missouri v. Hunter,(29) the Supreme Court applied the test announced in Blockburger v. United States(30) to both multiple prosecutions and multiple punishment cases. According to this standard, a statute which authorizes a second punishment or prosecution will pass double jeopardy scrutiny only if each statutory provision "requires proof of a fact which the other does not."(31)

      In Hunter, the Supreme Court first acknowledged that courts must apply separate tests to evaluate each of these interests for double jeopardy purposes.(32) The state had charged and sentenced the defendant in Hunter in one proceeding with "armed criminal action" and "first-degree robbery."(33) In short, the Supreme Court held that the cumulative punishments did not violate double jeopardy, even though the statutes proscribing this conduct could not pass the Blockburger test.(34) In announcing a new standard for multiple punishments, the Court held that "[w]ith respect to cumulative sentences imposed in a single trial, the Double Jeopardy Clause does no more than prevent the sentencing court from prescribing greater punishment than the legislature intended."(35) As such, Blockburger's blanket prohibition of multiple sentences for the same conduct now supplies nothing more than a rule of statutory construction, which the legislature could eliminate.(36) In the wake of Hunter, the Blockburger standard retained its vitality only for cases involving multiple prosecutions.(37)

      The multiple prosecutions standard differs where the second state action is civil or not overtly criminal in nature.(38) Here, a court must first address the question of whether the second proceeding constitutes a second criminal prosecution.(39) In Kennedy v. Mendoza-Martinez,(40) the Supreme Court first examined the difference between criminal proceedings--which serve punitive purposes--and civil proceedings--which serve other, non-punitive interests.(41) Factors relevant to determining when a nominally "civil" proceeding becomes a "criminal" prosecution for double jeopardy purposes include: (1) whether the so-called "civil" proceeding involves an affirmative disability or restraint; (2) whether any sanction through the proceeding has historically been regarded as punishment; (3) whether liability under the proceeding arises only after a finding of scienter; (4) whether the proceeding promotes the traditional aims of punishment--retribution and deterrence; (5) whether the sanction imposed relates to behavior already established as a crime; (6) whether the proceeding has any non-punitive purpose; and (7) whether the proceeding imposes an excessive sanction in relation to its non-punitive purpose.(42) If a court applies these factors and finds that the civil proceeding constitutes a second criminal action, it must then apply the Blockburger rule to evaluate the elements of each proceeding.

      The Court later augmented the Kennedy standard in United States v. Ward(43) when it held that, in evaluating multiple prosecution cases, courts must first address a separate threshold question before raising the seven Kennedy factors.(44) Specifically, a court must first determine whether the legislature either expressly or impliedly indicated a preference for either the "criminal" or "civil" labels.(45) If the legislature intended to use the "civil" label, a court should apply the Kennedy factors to determine whether the action operates as a criminal prosecution notwithstanding that label.(46) In evaluating these factors, "only the clearest proof could suffice to establish the unconstitutionality of a statute" for double jeopardy purposes.(47)

   3. DOUBLE JEOPARDY APPLIED TO NON-TAX SANCTIONS

      Most of the double jeopardy jurisprudence in this area relates not to the constitutionality of a tax, but rather to the constitutionality of a civil penalty. Thus, the lower federal courts in Kurth Ranch(48) and several state courts(49) have applied civil penalty double jeopardy analysis, as enunciated in United States v. Halper,(50) to evaluate taxes.

      In Halper, the Supreme Court announced a standard for determining when a civil penalty constitutes a second punishment for double jeopardy purposes.(51) Halper involved violations of the criminal false claims statute,(52) which imposed criminal sanctions as well as a civil penalty of $2000 for each violation.(53) The United States had charged the defendant with making sixty-five separate claims for reimbursement of twelve dollars from the government for medical services rendered which were, in fact...