TORONTO - Conrad Black and his co-defendants are opposing the U.S. government's request to have them forfeit US$17 million following their convictions for fraud, saying prosecutors are overreaching and "pushing the forfeiture envelope.''

"In recent times, the government's use of forfeiture power has been criticized,'' Black's lawyers said in documents filed with the U.S. District Court in Chicago.

"This case presents another example of the government pushing the forfeiture envelope. It seeks forfeiture based on portions of the alleged fraudulent scheme as to which the jury acquitted the defendants; it seeks to forfeit alleged proceeds more than once; and it inaccurately designates alleged proceeds.''

Government lawyers said last month the former media tycoon and two of his long-time business associates should forfeit nearly US$17 million for their role in defrauding Hollinger International investors.

The prosecutors seek to hold Black, Jack Boultbee and Peter Atkinson jointly liable for the "U.S. community newspaper fraud scheme'' -- one of several newspaper sales that were the focus of a three-month-long criminal trial earlier this year in Chicago

Black, once the head of the Hollinger newspaper empire, was convicted in July of three counts of fraud. Boultbee, Atkinson and former Hollinger International general counsel Mark Kipnis were also convicted of three counts of fraud involving the same transactions.

In addition, Black was convicted of obstruction of justice, related to the removal of several boxes from his former Hollinger Inc. headquarters office in Toronto.

Black was acquitted of six counts of mail and wire fraud, two tax evasion counts and one charge of racketeering. A money laundering count was also dropped in May when prosecutors rested their case.

He and his three co-accused -- who were also found not guilty on several charges each -- are appealing their convictions, asking for acquittals or new trials on those charges alone.

All four men are scheduled to be sentenced Nov. 30 and are free on bail, although Black isn't allowed to leave the United States and his right to travel has been restricted

Prosecutors have argued from the beginning that courts have repeatedly recognized that a forfeiture judgement "can and should include the proceeds of the entire scheme, regardless of whether the jury has acquitted the defendants of some counts within that scheme.''

They say the standard at sentencing, including determining the amount of forfeiture, is less strict than required for a conviction, and have also suggested they may target Black's beach-front mansion in Palm Beach, Fla., which he used to secure his bail and a US$2.6-million, 26-carat diamond ring that he gave to his wife.

Defence lawyers have argued that Black's sentence will be well below the government's estimates because he was acquitted of nine of the 13 counts against him, meaning the fraud amounted to $3 million -- not the $60 million initially claimed.

They make a similar argument against the forfeiture.

"Notwithstanding the government's efforts to spin the verdict into something it is not, the verdict is clear: Black was found guilty of three discrete acts of mail fraud associated with two particular transactions ... Nothing more '' the filing states.

"Seeking forfeiture beyond the counts of conviction is not the only manner in which the government has overreached.''

Black's lawyers say that if the government is entitled to any money at all, the convicted offences giving rise to forfeiture would allow, at most, for forfeiture of $6.1 million. That amount should be allocated among the defendants -- leaving Black to a $3-million forfeiture judgment that excludes any property or jewelry.

Lawyers for Atkinson and Boultbee make similar arguments in their own filings, with Boultbee's lawyers arguing that "the government's position not only lacks analytic validity; it is also grossly disproportional to Boultbee's culpability found by the jury or the amount of proceeds Boultbee received.''

Atkinson's lawyers argued their client "made full restitution to Hollinger International of each of the non-compete payments he had received, with interest, at he first suggestion they were not properly authorized.''

They urge Judge Amy St. Eve to "reject the government's heavy-handed request,'' calling it "grossly disproportionate.''