Kaneshiro v. Eleven

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Electronically Filed
Supreme Court
SCWC-XX-XXXXXXX
20-DEC-2021
11:02 AM
Dkt. 32 OP
IN THE SUPREME COURT OF THE STATE OF HAWAIʻI
---o0o---
________________________________________________________________
STEVEN S. ALM1, in his official capacity as
the Prosecuting Attorney of the City and County of Honolulu,
on behalf of the State of Hawaiʻi,
Respondent/Petitioner-Appellant,
vs.
ELEVEN (11) PRODUCTS DIRECT SWEEPSTAKES MACHINES (TOTAL
EXTIMATED VALUE: $38,500.00), FOUR HUNDRED FIFTY SEVEN DOLLARS
IN UNITED STATES CURRENCY ($457.00); ONE (1) CAM SECURITY
DIGITAL RECORDING SYSTEM (ESTIMATED VALUE: $200.00) (TOTAL
AGGREGATE VALUE: $39,157.00),
Respondent/Defendant-Appellee,
and
PJY ENTERPRISES, LLC,
Petitioner/Claimant-Appellee,
and
WINNER’Z ZONE; APRIL WHITING-HARAGUCHI,
TRACY YOSHIMURA, and WENDY WAGNER,
1 Pursuant to Hawaiʻi Rules of Appellate Procedure Rule 43(c)(1)
(2019), Steven S. Alm has been substituted as a party in place of Keith M.
Kaneshiro, the former Prosecuting Attorney of the City and County of
Honolulu.
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Respondents/Interested Persons-Appellees.
(CAAP-XX-XXXXXXX; S.P. NO. 14-1-0567)
SCWC-15-00008482
CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
(CAAP-XX-XXXXXXX, S.P. NO. 14-1-0567; CAAP-XX-XXXXXXX,
S.P. NO. 14-1-0568; CAAP-XX-XXXXXXX, S.P. NO. 14-1-0569;
CAAP-XX-XXXXXXX, S.P. NO. 14-1-0570; CAAP-XX-XXXXXXX,
S.P. NO. 14-1-0571; CAAP-XX-XXXXXXX, S.P. NO. 14-1-0572)
DECEMBER 20, 2021
RECKTENWALD, C.J., NAKAYAMA, McKENNA, AND WILSON, JJ.3
OPINION OF THE COURT BY WILSON, J.
This case addresses whether the Honolulu Police
Department’s (“HPD”) seizure of seventy-seven Product Direct
Sweepstakes (“PDS”) machines and the Office of the Prosecuting
Attorney’s subsequent petition for administrative forfeiture
comported with Hawai‘i=s civil forfeiture statute, Hawaii Revised
Statutes (“HRS”) Chapter 712A. In September 2012, HPD began
seizing PDS machines from six Winner’z Zone locations because it
deemed the machines to be in violation of Hawaiʻi’s gambling
2 CAAP-XX-XXXXXXX, CAAP-XX-XXXXXXX, CAAP-XX-XXXXXXX,
CAAP-XX-XXXXXXX, CAAP-XX-XXXXXXX, and CAAP-XX-XXXXXXX were previously
consolidated in the Intermediate Court of Appeals (“ICA”) under CAAP-15-
0000848.
3 Associate Justice Richard W. Pollack who was a member of the
court when oral argument was held, retired from the bench on June 30, 2020.
2
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statutes.4 The machines remained in police custody for nearly
two years. During that time, HPD did not initiate forfeiture
proceedings pursuant to HRS § 712A-7(3) (1991)5, did not give
notice of the seizure of forfeiture to all parties known to have
an interest in the property and did not provide the prosecutors
a written request for forfeiture as required by HRS §712A-7(4)
4 The relevant gambling statutes are HRS §§ 712-1222 and 712-1226
(1991). HRS § 712-1222 provides:
(1) A person commits the offense of promoting
gambling in the second degree if the person knowingly
advances or profits from gambling activity.
(2) Promoting gambling in the second degree is
a misdemeanor.
HRS § 712-1226 provides:
(1) A person commits the offense of possession
of a gambling device if the person manufactures,
sells, transports, places, possesses, or conducts or
negotiates any transaction affecting or designed to
affect ownership, custody, or use of any gambling
device, knowing it is to be used in the advancement
of gambling activity which is not social gambling.
(2) Possession of a gambling device is a
misdemeanor.
5 HRS § 712A-7(3) provides:
As soon as practicable after seizure for
forfeiture, the seizing agency shall conduct an
inventory and estimate the value of the
property seized. Within twenty days after
seizure for forfeiture the seizing agency shall
make reasonable efforts to give notice of
seizure for forfeiture in the manner provided
in section 712A-8(a) or 712A-8(b) to all
parties known to have an interest in the seized
property.
3
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(1991).6 Instead, in September 2014, HPD “re-seized” the
machines for forfeiture and began forfeiture proceedings.
Forfeiture proceedings were initiated on September 22, 2014, by
the prosecutor’s office.
We hold that a seizing agency’s failure to commence
forfeiture proceedings according to the specific timing
requirements set forth in HRS §§ 712A-7 and 712A-97 (1991)
requires the agency to return the seized property.
6 HRS § 712A-7(4) provides:
(4) In the event of a seizure for forfeiture under section
712A-6, the seizing agency shall send to a prosecuting attorney a
written request for forfeiture within thirty days, which shall
include a statement of facts and circumstances of the seizure,
the appraised or estimated value of the property, and a summary
of the facts relied on for forfeiture.
7 HRS § 712A-9 provides in relevant part:
(1) The prosecuting attorney shall determine whether it is
probable that the property is subject to forfeiture and, if so,
shall initiate administrative or judicial proceedings against the
property within forty-five days of receipt of a written request
for forfeiture from a seizing agency. If, on inquiry and
examination, the prosecuting attorney determines, with sole
discretion, that the proceedings probably cannot be sustained or
that justice does not require the institution of proceedings, the
prosecuting attorney shall notify the seizing agency, and as soon
as practicable authorize the release of the seizure for
forfeiture on the property or on any specified interest in it. A
determination by the prosecuting attorney to forego initiation of
proceedings shall not be a bar to initiation of proceedings
against the same property based on the same circumstances at a
later time.
4
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I. Background
A. Factual Background
On September 26, 2012, HPD obtained a search warrant
to search six Winner’z Zone business locations for property held
in violation of Hawaiʻi’s gambling statutes, HRS §§ 712-1222 and
712-1226. The following day, on September 27, 2012, HPD began
executing the search warrant at each location. HPD seized
seventy-seven PDS machines, in addition to other items it deemed
violated Hawaiʻi’s gambling statutes that was authorized by the
search warrant.
The PDS machines remained in HPD custody for nearly
two years before HPD began forfeiture proceedings. HPD
cancelled the investigation for the initial HPD report number
that documented the seizure for forfeiture “[d]ue to time
constraints.” After the investigation was cancelled, the
machines remained in police custody. On September 12, 2014, a
new HPD report number was issued by HPD stating that the PDS
machines were re-seized for forfeiture.8
8 The Prosecuting Attorney asserted in the Petition for
Administrative Forfeiture filed with the Department of Attorney General on
September 22, 2014, that HPD cancelled its 2012 investigation (HPD report
number 12-351453) due to time constraints and that the property was re-seized
under HPD report number 14-332134.
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Seven days later, on September 19, 2014, HPD sent a
request for forfeiture to the Office of the City and County of
Honolulu Prosecuting Attorney (“prosecutor’s office”). On
September 22, 2014, pursuant to HRS § 712A-9, the prosecutor’s
office began administrative forfeiture proceedings by filing a
petition for administrative forfeiture with the Department of
the Attorney General. Petitioner/Appellee-Claimant, PJY
Enterprises, LLC (“PJY”) challenged the seizure on November 3,
2014,9 by filing a claim to the seized property and a request for
judicial review of administrative forfeiture.10
9 PJY previously challenged the seizure on October 12, 2012, by
filing a complaint for declaratory judgment, injunctive relief, and monetary
damages against HPD in the circuit court. That case was removed to federal
court. On April 30, 2014, the federal court granted a motion for summary
judgment in favor of the Prosecuting Attorney, finding that the PDS machines
constituted gambling devices under the Hawaii gambling statutes.
10 HRS § 712A-10(9)(1991) provides that an individual claiming
seized property may request judicial review of a forfeiture:
(9) Any person claiming seized property may seek
judicial review of the seizure and proposed
forfeiture by timely filing with the attorney general
a claim and bond to the State . . . . In lieu of a
cost bond, a claimant may file an in pauperis bond
sworn on oath before a notary public . . . . Upon
receipt of the claim and bond, the attorney general
shall notify the prosecuting attorney who may
discretionarily continue to seek forfeiture by
petitioning the circuit court for forfeiture of the
property within forty-five days of receipt of notice
that a proper claim and bond has been filed. The
prosecuting attorney may also elect to honor the
claim in which case the prosecuting attorney shall
notify the seizing agency and authorize the release
(continued . . .)
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In response to PJY=s request for judicial review of the
forfeiture, on December 19, 2014, the prosecutor’s office began
judicial forfeiture proceedings by filing a verified petition
for forfeiture in the circuit court pursuant to HRS § 712A-9.
In the petition for forfeiture, the prosecutor’s office asserted
that “the subject property was initially seized for forfeiture
on or about September 27, 2012” and then “re-seized for
forfeiture on or about September 12, 2014”. It was also
asserted that the seized property was subject to forfeiture
because the property was used in the commission of a covered
offense. The prosecutor’s office requested that the property be
distributed to the attorney general in accordance with
HRS § 712A-16(2) (2003).11 PJY filed a motion to dismiss the
verified petition for forfeiture. The prosecutor’s office
opposed the motion.
(. . . continued)
of the seizure for forfeiture on the property or on
any specified interest in it.
11 Forfeited property is distributed according to HRS § 712A-16(2):
(2) All forfeited property and the sale proceeds
thereof, up to a maximum of three million dollars per
year, not previously transferred pursuant to
[subsection] (1)(a) of this section, shall, after
payment of expenses of administration and sale, be
distributed as follows:
(continued . . .)
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The Circuit Court of the First Circuit (“circuit
court”) granted PJY=s motion to dismiss the verified petition for
forfeiture and granted in part PJY’s alternative motion for
summary judgment.12 The circuit court dismissed the verified
petition because the prosecutor’s office failed to comply with
the time limitations under HRS § 712A-1713 and HRS § 701-108(2).14
(. . . continued)
(a) One quarter shall be distributed to the
unit or units of state or local government
[whose] officers or employees conducted the
investigation and caused the arrest of the
person whose property was forfeited or seizure
of the property for forfeiture;
(b) One quarter shall be distributed to the
prosecuting attorney who instituted the action
producing the forfeiture; and
(c) One half shall be deposited into the
criminal forfeiture fund established by this
chapter.
12 The Honorable Randal K.O. Lee presided.
13 HRS § 712A-17 provides:
“Notwithstanding any other provision of law, forfeiture proceedings
under this chapter may be commenced at any time within the period in
which a criminal proceeding may be instituted for a covered offense
pursuant to section 701-108.”
14 HRS § 701-108(2)(e) provides:
(2) Except as otherwise provided in this section,
prosecutions for other offenses are subject to the
following periods of limitation:
. . . .
(continued . . .)
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The circuit court also granted summary judgment in part after
concluding that there was no genuine issue of material fact as
to the prosecutor’s office’s violation of this time limitation
under HRS § 701-108(2) and that PJY was entitled to a judgment
as a matter of law. The State appealed.
B. ICA Decision
The ICA vacated the circuit court’s decision and
remanded for further proceedings. According to the ICA, the
circuit court incorrectly interpreted Chapter 712A to require
that both the administrative petition and the judicial petition
be filed within the two-year statute of limitations delineated
in HRS § 712A-17. The ICA held that although the Prosecutor
failed to file the judicial petition within the two-year statute
of limitations, the petition was nevertheless timely because the
administrative petition was filed within the statute of
limitations. Under this analysis, the ICA held that where a
prosecuting attorney files a qualifying claim for forfeiture
pursuant to HRS § 712A-9 and requests judicial review of an
administrative petition, the prosecuting attorney may
(. . . continued)
(e) A prosecution for a petty misdemeanor or
parking violation must be commenced within two
years after it is committed[.]
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“discretionarily continue to seek forfeiture by petitioning the
circuit court for forfeiture of the property[.]” HRS § 712A-
10(10) provides that “no duplicate or repetitive notice shall be
required. The judicial proceeding, if any, shall adjudicate all
timely claims.” Reading these two provisions together, the ICA
held that the judicial proceeding is a continuation of a
preexisting administrative proceeding pursuant to HRS § 712A-
9(1) and “bringing the administrative petition within the
statute of limitations period satisfies that requirement.”
Having determined that the prosecuting attorney did
not violate the statute of limitations, the ICA considered the
timing requirements of HRS §§ 712A-7 and 712A-9. As interpreted
by the ICA, these provisions require HPD to send a request for
forfeiture to the prosecuting attorney within thirty days of
seizure and require the prosecuting attorney to determine
whether the property is likely subject to forfeiture pursuant to
HRS § 712A-5 and, if so, to file the petition for forfeiture
within forty-five days of the request. The ICA asserted that
the first seizure by HPD occurred on September 27, 2012;
accordingly the ICA concluded that HPD failed to meet these
statutory deadlines mandated by HRS §§ 712A-7 and 712A-9 because
HPD failed to make reasonable efforts to give notice of seizure
within twenty days to all parties who were known to have an
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interest in the seized property.15 However, the ICA ruled that
the failure of HPD to file petitions to begin forfeiture
proceedings within forty-five days in accordance with HRS §§
712A-7 and 712A-9 was not sanctionable because those provisions
do not provide penalties for their violation. The ICA held that
“failure to comply with the internal deadlines contained in HRS
§ 712A will not serve as a bar for [a] petition brought within
the limitation provision continued in HRS § 712A-17.”
Pursuant to HRS § 712A-17, forfeiture proceedings
must be commenced within the statute of limitations to file the
covered offense. In the present case, the covered offenses were
misdemeanors. Therefore, prosecution must have commenced within
two-years pursuant to HRS § 701-108(2)(e). The ICA thus
concluded that the two-year statute of limitations contained in
HRS § 712A-17--rather than the statutory deadlines contained in
HRS §§ 712A-7(3)16 and 712A-9(1)17--establish the time by which
15 If September 27, 2012 is the seizure for forfeiture date, HPD
took the actions required pursuant to HRS § 712A-7 and HRS § 712A-9 nearly
two years after the seizure by notifying the prosecutor’s office. On
September 19, 2014, a request for forfeiture was sent to the prosecuting
attorney. The prosecutor’s office filed a petition for administrative
forfeiture on September 22, 2014.
16 HRS § 712A-7 provides:
(3) . . . Within twenty days after seizure for
forfeiture the seizing agency shall make reasonable
(continued . . .)
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HPD and the prosecutor’s office must initiate forfeiture
actions. The ICA relied on United States v. James Daniel Good
Real Prop., 510 U.S. 43 (1993). In Good, the United States
Supreme Court found that, because the customs statute containing
forfeiture timing requirements did not provide a remedy for the
government’s noncompliance, and because a statute of limitations
already existed to prevent stale claims from being brought, the
customs statute’s forfeiture timing requirements were simply
internal timing requirements that could not be enforced by the
Court. 510 U.S. at 65. The ICA found HRS Ch. 712A to be
analogous to the customs statute at issue in Good. The ICA
(. . . continued)
efforts to give notice of seizure for forfeiture in
the manner provided in section 712A-8(a) or 712-8(b)
to all parties known to have an interest in the
seized property.
(4) In the event of a seizure for forfeiture under
section 712-6, the seizing agency shall send to a
prosecuting attorney a written request for forfeiture
within thirty days, which shall include a statement
of facts and circumstances of the seizure, the
appraised or estimated value of the property, and a
summary of the facts relied on for forfeiture.
17 HRS § 712A-9(1) provides:
“The prosecuting attorney shall determine whether it is
probable that the property is subject to forfeiture and, if
so, shall initiate administrative or judicial proceedings
against the property within forty-five days of receipt of a
written request for forfeiture from a seizing agency . . .”
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stated that HRS Ch. 712A similarly lacks a remedy for
noncompliance with the forfeiture timing requirements, and also
provides a statute of limitations to prevent stale claims. The
ICA characterized HRS §§ 712A-7 and 712A-9 as providing
unenforceable internal timing requirements analogous to the
customs statute in Good. Accordingly, the ICA concluded that
the circuit court erred in its application of the time
limitations of Section 712A-7 and 712A-9 to the September 27,
2012, seizure by HPD. The ICA vacated the circuit court’s order
granting PJY Enterprises, LLC’s motion to dismiss the verified
petition for forfeiture and/or in the alternative granting PJY’s
Enterprises, LLC’s motion for summary judgment. Further, the
ICA vacated the final judgment of the circuit court dated
October 8, 2015 dismissing the case and remanded for further
proceedings.
II. Standard of Review
The interpretation of a statute is a question of law
reviewable de novo.
When construing a statute, our foremost
obligation is to ascertain and give effect to
the intention of the legislature, which is to
be obtained primarily from the language
contained in the statute itself. And we must
read statutory language in the context of the
entire statute and construe it in a manner
consistent with its purpose.
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Ka Paakai O Kaaina v. Land Use Comm’n, 94 Hawaii 31, 41, 7 P.3d
1068, 1078 (2000) (internal quotation marks and citations
omitted) (quoting Amantiad v. Odum, 90 Hawaii 152, 160, 977 P.2d
160, 168 (1999)).
III. Discussion
HPD seized PJY’s seventy-seven machines on September
27, 2012, and took no action to inform Petitioner of the
seizure, or request the prosecutor’s office to seek forfeiture
until it sent a request for forfeiture to the prosecutor’s
office on September 19, 2014--nearly two years after the initial
seizure.18 The ICA relied upon HRS § 712A-17 to conclude that
the sole time limitation on the government’s use of forfeiture
is the statute of limitation applicable to the offense for which
the forfeited evidence is to be used. HRS § 712A-17 states in
pertinent part: “Notwithstanding any other provision of law,
forfeiture proceedings under this chapter may be commenced at
any time within the period in which a criminal proceeding may be
instituted for a covered offense pursuant to section 701-108.”
Under this analysis, the time limitations contained in
HRS §§ 712A-7(4) or 712A-9(1) become merely internal deadlines
18 The prosecuting attorney consequently did not initiate forfeiture
proceedings until September 22, 2014.
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with no prescriptive effect. PJY would have no recourse for the
return of its property until the expiration of the two-year
statute of limitations applicable to the underlying offenses of
Gambling in the Second Degree in violation HRS § 712-1222 and
Possession of a Gambling Device in violation of HRS § 712-1226.
Thus, the failure of HPD, as the “seizing agency” to “make
reasonable efforts to give notice of seizure for forfeiture . .
. within thirty days of seizure,” pursuant to HRS § 712A-7(3)
and to “send to a prosecuting attorney a written request for
forfeiture within thirty days” after the property was seized,
pursuant to HRS § 712A-7(4); and the failure of the prosecuting
attorney to “initiate administrative or judicial proceedings
against the property within forty-five days” of receipt of HPD’s
request for forfeiture, pursuant to HRS § 712A-9(1) are of no
consequence to the continued deprivation of PJY’s property by
HPD.
The legislative history of HRS Chapter 712A
contradicts the ICA’s proposition that legislative intent was to
render unenforceable the forfeiture deadlines set forth in HRS
§§ 712A-7 and 712A-9. In 1991, the legislature reinstated the
timing requirements of HRS § 712A-9 to “require[] the prosecutor
to initiate forfeiture proceedings within forty-five days of
receipt of written request for forfeiture or to return the
15
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property seized.” S. Stan. Comm. Rep. No. 1049, in 1991 Senate
Journal, at 1117.19 In so doing, the legislature made explicit
its intent that the remedy for noncompliance with HRS § 712A-9’s
deadlines was the return of the property.
That the legislature intended the remedy for
noncompliance with the timing deadlines of forfeiture to be the
return of the property is further supported by the deadlines
applicable to an individual claiming an interest in forfeited
property. Pursuant to HRS § 712A-10(4), a claim of interest
must be made within thirty days of notice of the seizure.20 HRS
19 In 1988 the legislature enacted Act 260 which amended HRS § 712A-
9(1) to state:
The prosecuting attorney shall determine
whether it is probable that the property is subject
to forfeiture and, if so, may cause the initiation of
administrative or judicial proceedings against the
property. If, on inquiry and examination, the
prosecuting attorney determines that the proceedings
probably cannot be sustained or that justice does not
require the institution of such proceedings, the
prosecuting attorney shall notify the seizing agency,
and as soon as practicable authorize the release of
the seizure for forfeiture on the property or on any
specified interest in it.
1988 Haw. Sess. Laws Act 260, § 9 at 461.
20 HRS § 712A-10(4) provides in relevant part:
Persons claiming an interest in the property
may file either a petition for remission or
mitigation of forfeiture, or a claim and cost or in
pauperis bond, but not both, with the attorney
(continued . . .)
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§ 712A-10(4) does not explicitly prohibit a claim of interest
after the thirty day deadline; however, it would be contrary to
the intended purpose of the deadline to conclude that the State
would not be subject to a claim of interest on the forfeited
property until after the thirty day limitation stated in HRS §
712A-10(4). Similarly, the logical consequence of the State’s
failure to commence forfeiture proceedings within the deadlines
delineated in HRS §§ 712A-721 and 712A-922 is the return of seized
property.
Finally, the ICA’s reliance by on the United States
Supreme Court’s decision in Good to conclude that the deadlines
enumerated in HRS § 712A-7 and § 712A-9 are internal deadlines
and failure to comply with these deadlines “will not serve as a
bar for a petition [for forfeiture]” is misplaced. In Good,
because the customs statute at issue did not provide a remedy
(. . . continued)
general, within thirty days of notice by publication
or receipt of written notice, whichever is earlier.
21 The seizing agency must also “send to a prosecuting attorney a
written request for forfeiture within thirty days” after the property is
seized. HRS § 712A-7(4)(emphasis added).
22 Once the prosecuting attorney receives the written request, the
prosecuting attorney “shall initiate administrative or judicial proceedings
against the property within forty-five days.” HRS § 712A-9(1)(emphasis
added).
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for failure to comply with the provision, the Court interpreted
the statute to be an internal guideline rather than one
enforceable by the courts. 510 U.S. at 64-65. The Court
explained that, because the statute lacked a consequence for
noncompliance, Congress impliedly left enforcement to the
administering officials. Here, the legislative history of HRS §
712A-9 explicitly provides that the seizing agency must return
the seized property if the State fails to follow HRS § 712A-9.
IV. Conclusion
In conclusion, the failure of HPD and the Prosecutor
to comply with the twenty day and forty-five day statutory
deadlines contained in HRS §§ 712A-7 and 712A-9 applicable to
seizure of Petitioner’s property require its return.
Accordingly, we vacate the ICA’s July 31, 2017 Judgment on
Appeal, and remand the case to the circuit court for further
proceedings consistent with this opinion.
Keith M. Kiuchi /s/ Mark E. Recktenwald
for petitioner/claimant-
appellee /s/ Paula A. Nakayama
Kurt Y. Nakamatsu /s/ Sabrina S. McKenna
for respondent/plaintiff-
appellant /s/ Michael D. Wilson
18