KEARSE, Circuit Judge:
Defendant Michael Pescatore, who was convicted of operating chop shops in violation of 18 U.S.C. §§ 2322 and 2, and of extortion offenses in violation of 18 U.S.C. §§ 1951 and 2, and who, in his plea agreement with the government, agreed to forfeit $2.5 million in cash, plus certain real estate, and to pay-restitution in an amount not less than $3 million, appeals from an order of the United States District Court for the Eastern District of New York, Thomas C. Piatt, Judge, denying his postconviction motion for an order either compelling the government to use a portion of his forfeited assets to relieve him of his restitution obligations, a process called "restoration," 18 U.S.C. § 981(e)(6), or vacating as illegal the requirement in the amended judgment of conviction that he pay $3 million in restitution, to the extent that that sum exceeds the total losses suffered
For the reasons that follow, we conclude that the district court did not err in rejecting Pescatore's restoration request; that the amended judgment did not reduce the $3 million amount that Pescatore was ordered to pay in restitution; and that Pescatore is not entitled to an immediate—if any—order excusing him from paying that amount. The amount to be paid is limited to the restitution amounts needed to make Pescatore's victims whole, plus interest that Pescatore is obligated to pay on the properly ordered restitution amounts that he has not timely paid, see 18 U.S.C. § 3612(f)(1), plus any penalties to which he may be subject for unpaid restitution amounts as to which he is or was delinquent and/or in default, see id. §§ 3612(g), 3572(h)-(i). If all required payments of restitution, interest, and restitution-related penalties total less than $3 million, Pescatore will be entitled to a refund of the remainder. Accordingly, we affirm the denial of Pescatore's motion but remand for further proceedings.
To the extent relevant to the present case, Pescatore was first arrested, by law enforcement officers of Suffolk County, New York, in mid-2003. He and others, including Astra Motor Cars, Inc. ("Astra"), of which Pescatore was president and 50-percent owner, were indicted by a New York State grand jury on charges of fraud and enterprise corruption in violation of New York State law; Astra was also indicted on state-law charges of money laundering. In late 2003, the United States commenced an in rem civil action pursuant to 18 U.S.C. § 981(a)(1)(A) and (C) and 21 U.S.C. § 881(a)(6) and (7) (the "civil forfeiture action") against several properties owned in whole or in part, directly or indirectly, by Pescatore, including one property leased to Astra. The complaint in that action alleged, inter alia, that Astra had engaged in illegal trafficking in stolen vehicles and stolen vehicle parts and had defrauded customers. (See United States v. 322 Richardson Street, No. 2:03-cv-6456-TCP (E.D.N.Y. filed Dec. 24, 2003) ("Forfeiture Complaint" or "complaint") ¶¶ 21-23, 56-93.) It also alleged that Astra sold to a narcotics trafficking organization specially-ordered vehicles that could accommodate hidden compartments; that Astra accepted large sums of cash from that organization; and that Astra's other owner, Sanford Edmonston, knew that the buyers were drug dealers and that the cash was proceeds of narcotics trafficking. (See id. ¶¶ 19-20, 94-99.) The complaint sought forfeiture of the defendant properties on the ground that they
Pescatore, Astra, and numerous others were indicted by a federal grand jury in 2004. An 84-count second superseding indictment (the "Chop Shop Indictment")— alleging, inter alia, operation of chop shops in violation of 18 U.S.C. § 2322, alteration or removal of motor vehicle identification numbers in violation of id. § 511, mail fraud in violation of id. § 1341, conspiracy to defraud the United States in violation of id. § 371, and money laundering in violation of id. § 1956—named Pescatore in most of the counts.
In February 2005, Pescatore was also charged, in six counts of a new federal indictment, with extorting money from a number of individuals. In February 2006, the extortion case was tried, and Pescatore was convicted on three of the six counts.
In March 2006, pursuant to a plea agreement dated March 9, 2006 (the "Plea Agreement" or "Agreement"), Pescatore pleaded guilty to one count of the Chop Shop Indictment (count 22), which charged him with owning, operating, maintaining, or controlling a chop shop, in violation of 18 U.S.C. § 2322. Pescatore admitted that, in that operation from March 1987 through June 14, 2004, he "engaged in receiving stolen motor vehicle parts" that were used "to rebuild damaged motor vehicles" (Plea Hearing Transcript, March 9, 2006 ("Plea Tr."), at 19-20) and hired employees to take apart, rebuild, and sell such vehicles (id. at 21). The scheme also involved, inter alia, altering and removing vehicle identification numbers so that stolen cars could be sold to unwitting customers. (See id. at 22).
The Plea Agreement was designed to settle not only the Chop Shop Indictment charges but also the civil forfeiture action and the punishment to be imposed for the three counts on which Pescatore was convicted in the extortion case. The advisory-Guidelines-recommended range of imprisonment for his chop shop and extortion offenses was 188-235 months. In the Agreement, the government agreed to drop the remaining 50-odd counts alleged against Pescatore in the Chop Shop Indictment and agreed that an appropriate total prison term for the chop shop offense and the extortion offenses would be 132 months. (See Plea Agreement ¶¶ 4-5, 7.)
In addition to agreeing to plead guilty to count 22 of the Chop Shop Indictment, Pescatore agreed to, inter alia, pay restitution of "no less than $3 million":
(Plea Agreement ¶ 1.e.). The final sentence of this provision applied to Pescatore's federal tax liabilities but became moot, as Pescatore paid that debt prior to being sentenced.
In settlement of the civil forfeiture action, Pescatore agreed to forfeit $2.5 million in cash, plus real estate (see id. ¶ 9). With respect to the assets to be forfeited, the United States Attorney's Office for the Eastern District of New York ("USAO" or "Office") agreed to recommend that the
(Id. ¶ 17.)
Pescatore was sentenced some 2 1/2 years after his March 2006 plea of guilty. At the October 24, 2008 sentencing hearing, Pescatore informed the court that, in the interim, he had timely turned over many millions of dollars in assets (worth $9 million, see Hearing Transcript, January 29, 2010, at 17, 18) in complete satisfaction of his forfeiture obligations, and he urged the district court to impose a prison term of no more than 132 months in accordance with the Plea Agreement.
(Sentencing Transcript, October 24, 2008 ("Sentencing Tr."), at 3-4.)
The court indicated that it was prepared to sentence Pescatore to, inter alia, 132 months' imprisonment in accordance with the Plea Agreement, but it expressed concern that discussion in the PSR "about 180 months in custody as the agreed upon amounts" (id. at 11) could prove confusing to the Bureau of Prisons. Pescatore and the Assistant United States Attorney ("AUSA") agreed that it would be appropriate that the PSR be amended to match the Plea Agreement. (See id. at 12-14.) The record does not indicate that any other objection had been made to the PSR.
With regard to restitution, the government asked the court to order payment of $3 million in accordance with the Plea Agreement, and Pescatore reminded the court that the USAO had agreed to recommend restoration:
(Sentencing Tr. 14-16.) The government asked the court to order that the $3 million in restitution "be paid in full by the close of the year 2009" (id. at 21), a delay of some 14 months in light of the restoration recommendation to be made by the USAO to the DOJ. Pescatore asked that the due date for payment be delayed for at least three years rather than 14 months, so that he could receive credit for restitution payments that would be made by codefendants in the interim. (See id. at 21-24.) The government opposed that request, stating that Pescatore's victims had been "calling . . . for the past five years asking for their restitution." (Id. at 23.) The court granted the government's request and ordered that the restitution be paid on or before December 31, 2009. (See id. at 23-24.)
A judgment was entered sentencing Pescatore in accordance with the Plea Agreement. It ordered, inter alia, that "$3,000,000.00" in "restitution should be paid in full by the close of the year 2009." Judgment dated November 1, 2008, at 4, 5. The restitution order did not state, or otherwise incorporate, the names of the victims to whom restitution was to be made or the amount of loss sustained by each victim.
In January 2009, the government asked the court to correct the judgment pursuant to Fed.R.Crim.P. 36,
(Letter from AUSA Kathleen Nandan to Judge Piatt dated January 28, 2009 ("Government's January 2009 Letter"), at 1-2.) On January 30, 2009, the district court, noting the absence of any objection, granted
In April 2009, AUSA Nandan notified Pescatore that the DOJ had denied the restoration request. Pescatore was subsequently informed that Nandan could not disclose the reason for the denial because the Department considered the details of its response to the USAO to be privileged.
In late October and early November 2009, Pescatore, represented by new counsel citing Santobello v. New York, 404 U.S. 257, 92 S.Ct. 495, 30 L.Ed.2d 427 (1971), moved in the district court for an order compelling restoration as "specific performance" of ¶ 17 of the Plea Agreement, and, alternatively, sought a writ of coram nobis declaring ¶ 1.e. of the Agreement unenforceable as a matter of public policy to the extent that $3 million exceeds the total losses of Pescatore's chop shop victims ("restoration/restitution motion"). In support of restoration, Pescatore pointed out that the Plea Agreement stated that the DOJ would make its decision in accordance with applicable law, and he argued that it should be compelled to apply a portion of his forfeited assets to satisfy his restitution obligation because no law forbade it to do so. The government responded that there had been no breach of the Plea Agreement by the government. The AUSA stated that the USAO had fulfilled its promise to recommend restoration (see Motion Hearing Transcript, January 29, 2010 ("Motion Tr."), at 18 ("We made a recommendation to the Department of Justice"; "we made the recommendation, we made the request")); that "[t]he request was denied because the defendant actually does have assets" (id.); and that DOJ's decision to deny restoration "is not reviewable in a court of law" (id.).
In support of his request for modification of the restitution order, Pescatore pointed out that the purpose of restitution is not punishment, but compensation of victims, and that the losses listed in the PSR Loss Chart attached to the Judgment totaled less than $3 million. He also argued that in reality the total amount of victims' losses was even less than the total indicated by the Loss Chart. He asked that the Plea Agreement be voided and that the restitution amount be recalculated to reflect the actual losses suffered by his victims.
The government, in opposition to Pescatore's request for a reduction of his restitution obligation, stated, inter alia, that
(Letter from Special AUSA Karen R. Hennigan to Judge Piatt dated December 30, 2009 ("Government's December 2009 Letter"), at 2-3 (emphasis in original).)
At the January 29, 2010 hearing on Pescatore's motion, the colloquy with respect to restitution included the following:
(Motion Tr. 4-5.)
Froccaro argued that the victims' losses totaled "at least $1.2 million less than what your Honor ordered" (id. at 5); and although saying that he was unable to state a "definite figure" (id. at 6), he said, "Judge, this loss is on the PSR for 1.8" (id. at 18); "Judge, I took a calculator out, I added up the loss amount in the PSR, and it added up to 1.8" (id. at 22; but see id. at 21 ("I never agreed to the $1.8 million, your Honor.")). Froccaro acknowledged that Pescatore had not appealed to challenge the $3 million amount. (See id. at 6.)
The government, represented at the hearing by AUSAs Hennigan and Gatz, appeared to take divergent positions on whether the $3 million amount was proper. Hennigan pointed out that "there is a plea agreement wherein the defendant got the benefit of a bargain, got the benefit of an agreement that required him to pay $3 million as of the 31st of December 2009, which was passed" (id. at 9); but she also stated that, from the numbers in "the presentence report that was incorporated into the sentence" (id. at 10), she calculated the victims' losses "to be about $2.7 million" (id. at 11); and she said that "[i]n the event that there is ever some overpayment, the government would certainly consider that" (id. at 9).
AUSA Gatz took the position that Pescatore should be bound by the Judgment, based on his express agreement to pay restitution of not less than $3 million:
(Motion Tr. 14.)
The court ultimately rejected all of Pescatore's arguments. Having requested in vain that Pescatore provide "specifics" (id. at 8) and "proof" (id. at 12) as to the contention that his victims' losses totaled no more than $1.8 million, the court found that that contention was not substantiated, "not on the representations you made here today, which [are] solely an effort to get more time" (id. at 22). Further noting that, of the amount he did not dispute, Pescatore "ha[d]n't even produced a dollar in good faith" (id. at 28), the court stated that Pescatore should at least pay the undisputed amount immediately (see id. at 27 ("Pay what you say you owe."); id. at 22 ("Pay them the 1.8.").) And although noting that compliance with the Judgment was already nearly 30 days overdue, the court gave Pescatore a new 30-day period within which to pay the $3 million ordered in the Judgment; the court denied Pescatore's request for a longer period and stated that after 30 days the government should begin to levy on Pescatore's property (See id. at 20-24.)
(Motion Tr. 21-22.)
(Id. at 24-25.)
(Id. at 27.)
This appeal followed. The new 30-day period granted by the district court ended on March 1, 2010. On March 3, Pescatore moved in this Court for a stay of his restitution obligation. That motion was denied on March 5.
On appeal, Pescatore pursues his contentions (1) that restoration, to relieve him of his restitution obligation, was required because no law prohibited the DOJ from granting him that relief; and (2) that, as the purpose of restitution is compensation, the Judgment ordering him to pay $3 million in restitution is illegal to the extent that that amount (a) exceeds the total of his victims' losses as shown by the PSR Loss Chart and (b) exceeds an actual— albeit unspecified—loss total that he alleges is lower than that shown by the PSR. For the reasons that follow, we find no merit in the restoration contention. With respect to restitution, Pescatore is of course correct that its purpose is to compensate victims; however, as Pescatore did
Civil forfeiture actions such as that commenced by the government against Pescatore in 2003 and settled pursuant to the Plea Agreement are governed by 18 U.S.C. § 981. That section "subject[s] to forfeiture to the United States" property that was involved in, inter alia, various offenses under Title 18, including money laundering in violation of § 1956 and altering or removing motor vehicle identification numbers in violation of § 511. 18 U.S.C. §§ 981(a)(1)(A) and (F)(i). To the extent pertinent to the present appeal, § 981(e) provides that
18 U.S.C. § 981(e)(6) (emphases added). Thus, the Attorney General is allowed to choose between restoration and retention. Pescatore has not called to our attention, and we are not aware of, any provision in this or any other section that requires the Attorney General to choose either option over the other. The authorization either "to retain . . . or to transfer," with no accompanying statutory constraints, makes the decision between the two choices a matter of discretion.
Nor does anything in the Plea Agreement, which we interpret in accordance with traditional principles of contract law, see generally United States v. Brumer, 528 F.3d 157, 158 (2d Cir.2008), purport to place any constraints on the Attorney General's exercise of that discretion. Paragraph 17 of the Agreement obligated the USAO to "recommend" that the DOJ grant Pescatore relief in the form of restoration, and Pescatore has provided no reason to discredit the government's representation to the district court that the Office made the promised recommendation. The Agreement further stated expressly that the USAO "ha[d] authority only to recommend and that the final decision whether to grant such relief rest[ed] with the Department" (Plea Agreement ¶ 17), and Pescatore concedes that this called on the DOJ to "exercise its discretion" (Pescatore brief on appeal at 12). The promise that the Department would "make its decision in accordance with applicable law" (Plea Agreement ¶ 17) is not, as Pescatore would have it (see, e.g., Pescatore brief on appeal at 4, 9, 10, 12, 14,), the equivalent of a promise to grant restoration so long as it is not prohibited. The unambiguous statement that the Department, upon receiving the recommendation, would make its decision "in accordance with applicable law" plainly means that the Department would do anything the law requires and nothing the law prohibits. The Plea Agreement contains no promise that the DOJ would exercise its discretion to grant Pescatore relief that was not required.
In sum, we see nothing in the statutory provisions, DOJ's normal operating procedures, or the Plea Agreement that required the Department to use the forfeited assets to relieve Pescatore of his restitution obligations, and the record shows no failure on the part of the government to consider his request in good faith. The district court properly denied Pescatore's motion to compel the government to grant restoration.
The Mandatory Victims Restitution Act ("MVRA"), codified largely at 18 U.S.C. §§ 3663A and 3664, provides, in part, that in sentencing a defendant convicted of a felony "offense against property under" Title 18, "including any offense committed by fraud or deceit," the court "shall order, in addition to . . . any other penalty authorized by law, that the defendant make restitution to the victim of the offense." 18 U.S.C. § 3663A(a)(1) and (c)(1)(A)(ii). "In each order of restitution, the court shall order restitution to each victim in the full amount of each victim's losses as determined by the court and without consideration of the economic circumstances of the defendant." Id. § 3664(f)(1)(A).
The purpose of restitution is to compensate victims for their losses. See, e.g., Hughey v. United States, 495 U.S. 411, 416, 110 S.Ct. 1979, 109 L.Ed.2d 408 (1990), superseded by statute, Crime Control Act of 1990, Pub. L. No. 101-647 § 2509, 104 Stat. 4789, 4863 (codified at 18 U.S.C. § 3663(a)(3)); United States v. Boccagna, 450 F.3d 107, 115 (2d Cir.2006) ("Boccagna"); United States v. Reifler, 446 F.3d 65, 137 (2d Cir.2006) ("Reifler"); United States v. Nucci, 364 F.3d 419, 423-24 (2d Cir.2004) ("Nucci").
Boccagna, 450 F.3d at 115. Section 3663A does not authorize the court to order restitution to victims in excess of their losses. See, e.g., Reifler, 446 F.3d at 122-35; Boccagna, 450 F.3d at 109; Nucci, 364 F.3d at 423-24. And as "`[f]ederal courts have no inherent power to order restitution'" but only "`[s]uch authority [as is] conferred by Congress' through statute," United States v. Gottesman, 122 F.3d 150, 151 (2d Cir. 1997) (quoting United States v. Helmsley, 941 F.2d 71, 101 (2d Cir.1991) (emphasis ours)), the court has no authority under the MVRA to adopt or enforce an agreement calling for restitution in excess of that authorized by statute.
The chop shop offense of which Pescatore was convicted was plainly an offense "against property" and was "committed by fraud or deceit" within the meaning of 18 U.S.C. § 3663A(c)(1)(A)(ii). His operations involved, inter alia, receiving stolen car parts and using those parts to rebuild damaged motor vehicles, and transferring stolen cars to other individuals for replacement of the vehicle identification numbers with false numbers so that the cars could be sold to unwitting customers. (See Plea Tr. 19-22.) Thus, the MVRA was applicable and required the district court to order that Pescatore pay restitution to each identified victim of his offense in the full amount of the victim's losses. The court was not authorized to require restitution in excess of those losses.
Pescatore does not dispute the applicability of the MVRA; his contention is that the Plea Agreement and the Judgment are illegal because they require him to pay restitution in excess of his victims' losses. The government, for its part, does not contend on this appeal that it was permissible for the court to order restitution in excess of the victims' losses. Instead, its brief on appeal suggests that the amended Judgment against Pescatore in fact reduced the restitution order to $2,559,611.79:
(Government's brief on appeal at 18, 20 (emphasis added).)
We disagree with the government's characterization of the Judgment. However, given the posture of the case, we also disagree with Pescatore's contention that he should immediately be relieved of the requirement that he pay $3 million in connection with his restitution obligations.
Despite the government's contention on appeal that the amended Judgment requires Pescatore to pay no more in restitution than $2,559,611.79, nothing in the
Moreover, such a view was nowhere evident in the government's opposition to Pescatore's November 2009 request to have the ordered $3 million reduced to match the amount of his victims' losses. The government's preargument letter to the district court stated, inter alia, that "[t]he Court's order of mandatory restitution in the amount of $3 million is consistent with the Mandatory Victim[s] Restitution Act." (Government's December 2009 Letter at 2.) The letter contained no reference to $2,559,611.79. Nor at oral argument was there any mention of that number. AUSA Hennigan stated that based on the PSR pages incorporated in the Judgment, she calculated the victims' losses "to be about $2.7 million" (Motion Tr. 11); but that statement apparently was not meant to suggest that any less than $3 million was ordered in the Judgment, for she had referred to the possibility that there might be an "overpayment" (id. at 9), and when the court asked whether the Judgment ordered payment of $3 million, Hennigan answered affirmatively (id. at 21). AUSA Gatz echoed that affirmative answer (see id.); and she argued unequivocally that Pescatore had "agreed to pay $3 million" in restitution "and no less," that the court had "ordered" that amount in the "J & C," and that Pescatore's attempt to have that amount reduced was "improper" (id. at 14).
Finally, as revealed by the colloquy described in Part I.B. above, the district court itself plainly did not believe it had amended the judgment to reduce the restitution amount below $3 million. (See, e.g., id. at 21 (The Court: "Wasn't my order for $3 million? . . . . That is the judgment.").)
The record thus in no way supports the government's new contention that, because the judgment was amended to append the PSR Loss Chart listing Pescatore's victims and their losses, that "clerical" step reduced Pescatore's restitution obligation to $2,559,611.79. The Judgment orders Pescatore to pay restitution of $3 million.
As indicated above, 18 U.S.C. § 3664(f)(1)(A) required that the amount of each victim's loss be determined by the district court and included in the restitution order. Although the original judgment entered in November 2008 did not comply with this requirement, the amended Judgment appended the PSR Loss Chart that identified 80 chop shop victims in whose losses Pescatore was involved; those pages showed the precise amount of each victim's loss. Although the Loss Chart did not state an overall total of those items, the total is $2,559,611.79. Pescatore contends that the actual total amount of his victims' losses is less.
Pescatore had received the February 21, 2008 PSR well in advance of his sentencing hearing on October 24, 2008. The record does not indicate that in connection with sentencing he made any objection whatever to the PSR's specification of victims or losses, or to the total loss figure—$2,559,611.79 —that was in fact stated elsewhere in the PSR. Further, in January 2009, when the government asked the court to amend the original judgment by appending specific pages of the PSR, Pescatore made no objection: He did not suggest that any individual or entity identified in those pages was not a victim in whose loss he was involved; he did not suggest that any loss amount shown on those pages was incorrect; he did not suggest that the loss amounts listed totaled less than $2,559,611.79. And when the amended Judgment was entered, Pescatore did not appeal.
Pescatore's contention that his victims' losses total less than $2,559,611.79 was not advanced until he made his restoration/restitution motion, some nine months after the amended Judgment was filed. Given the lack of any timely objection to the correctness of the PSR Loss Chart's listing of Pescatore's individual victims, showing losses that total $2,559,611.79, Pescatore's contention that the Judgment is inaccurate because the appended PSR Loss Chart is inaccurate is reviewable only for plain error. See Fed. R.Crim.P. 52(b); United States v. Catoggio, 326 F.3d 323, 326 (2d Cir.2003); United States v. Coriaty, 300 F.3d 244, 252 (2d Cir.2002); United States v. Kinlock, 174 F.3d 297, 299 (2d Cir.1999).
Under the standard set by the Supreme Court for the application of Rule 52(b), before an appellate court is allowed to correct an error that was not timely raised in the district court four conditions must be met. "[T]here must be (1) `error,' (2) that is `plain,' and (3) that `affect[s] substantial rights'"; and "[i]f all three" of those "conditions are met, an appellate court may then exercise its discretion to notice a forfeited error, but only if (4) the error `seriously affect[s] the fairness, integrity, or public reputation of judicial proceedings.'" Johnson v. United States, 520 U.S. 461, 467, 117 S.Ct. 1544, 137 L.Ed.2d
Pescatore's contention that the actual losses suffered by his chop shop victims are less than the $2,559,611.79 detailed in the PSR Loss Chart that was made part of the Judgment does not meet even the first threshold condition of the plain-error test. His restoration/restitution motion asserted that "the aggregate amount of loss or restitution to the victims identified in the PSR is more than $1 million lower than Mr. Pescatore was ordered by the Court to pay" (Memorandum of Law in Support of Defendant Michael Pescatore's Santobello Motions at 7 (emphasis in original)), but it proffered no facts to support that assertion. The motion did not challenge the PSR's identification of any particular victim; and it did not challenge the amount of any specific PSR-itemized loss. Rather, it claimed that that lower amount was revealed by "[s]imple arithmetic" (id. at 7 n.5). Yet the motion did not proffer a precise amount by which Pescatore contended the PSR was in error. Nor was a precise figure—or any evidence —proffered at oral argument of the motion, despite the court's request for "proof" (Motion Tr. 12). Although Froccaro, Pescatore's attorney, stated that he used his calculator to determine that "the loss amount in the PSR . . . added up to 1.8" (id. at 22), Froccaro also said, "I never agreed to the $1.8 million," (id. at 21), and said he could not give the court a "definite figure" (id. at 6).
The district court thus ruled—properly —that it could not uphold Pescatore's challenge to the accuracy of the PSR based on his vague and conclusory assertions (see, e.g., Motion Tr. 22 ("not on the representations you made here today")).
Our own mathematical review confirms that the relevant victims' losses listed in the Loss Chart appended to the Judgment total $2,559,611.79. Although Pescatore's brief on appeal provides somewhat more enlightenment than was proffered to the district court as to the nature of his claim of arithmetic error, that claim improperly disregards the fact that in many instances his offense with respect to a particular vehicle caused losses to more than one victim. Given Pescatore's failure to proffer any evidence to show that the PSR Loss Chart is inaccurate, we cannot conclude that the amended Judgment's incorporation of the PSR's listing of losses totaling $2,559,611.79 is error, much less "plain" error.
Pescatore's contention that the Judgment is in error to the extent that it orders him to pay more than $2,559,611.79 is also subject to plain-error review and is far more problematic. In the original judgment entered in November 2003, the order that Pescatore pay restitution in the amount of $3 million did not include or incorporate any identification of Pescatore's victims or determination of each victim's loss. Hence that judgment's order that Pescatore pay restitution did not comply with the MVRA. Pescatore did not appeal to complain of that defect.
More importantly, when the government asked the district court to amend the original judgment by appending the PSR Loss Chart itemizing Pescatore's victims and their losses, which would apparently bring the Judgment into compliance with § 3664(f)(1)(A), Pescatore did not ask the district court to also amend the original $3 million figure so that the restitution ordered would not exceed the $2,559,611.79 in losses listed in the Loss Chart. Nor,
Given the government's concession on this appeal that it proved losses totaling only $2,559,611.79, the amended Judgment's retention of the order that Pescatore pay $3 million in restitution was error. And in light of the authorities cited above, that error is plain. Further, there can be no doubt that, at least at the time the Judgment was amended and itemized only $2,559,611.79 in losses, the error affected Pescatore's substantial rights, for it required him to pay some $440,000 more than the MVRA authorized. But these are just the threshold conditions that, if met, permit us to "exercise [our] discretion to notice a forfeited error . . . only if [] the error seriously affect[s] the fairness, integrity, or public reputation of judicial proceedings." Johnson, 520 U.S. at 467, 117 S.Ct. 1544 (internal quotation marks omitted) (emphasis added). In the present case, if Pescatore had proceeded to make timely payment of $2,559,611.79, we would, in the interest of justice, recognize that his restitution obligation was satisfied; or if he had timely paid the ordered $3 million, we would conclude that justice entitled him to a refund.
In fact, however, Pescatore, without obtaining a stay of the Judgment, simply flouted it. He moved on December 22, 2009—and renewed his motion on December 31, 2009—for a stay of the Judgment's requirement that he pay on or before December 31, 2009; but the court did not grant a stay. Pescatore nonetheless made no payment at or before that first deadline.
At the January 29, 2010 argument on Pescatore's request to reduce the restitution obligation, the court—despite repeatedly noting that Pescatore "ha[d]n't complied with the order of this court" (Motion Tr. 24), was nearly "30 days overdue" (id. at 20, 23; see, e.g., id. at 24, 25), and "ha[d]n't even produced a dollar in good faith" (id. at 28)—granted Pescatore a new 30-day period in which to make a restitutionary payment (see id. at 20). That 30-day period ended on March 1, 2010, and nothing in the record suggests that Pescatore made any payment by that date.
After his March 1, 2010 deadline had passed, Pescatore asked this Court to grant him a stay. That motion was promptly denied on March 5. No party has informed us that Pescatore has made any payment yet.
We note also that following this Court's denial of a stay, Pescatore made no effort whatever to expedite this appeal; instead he missed several filing deadlines, two of which resulted in dismissals (followed eventually by reinstatements) of the appeal. As a consequence of the lack of any urgency on Pescatore's part, this appeal was not submitted for decision until January 2011, nearly a year after the denial of his request to modify the restitution order, and more than 10 months after the expiration of the new 30-day period granted him at the January 2010 hearing—when he was already in noncompliance—to make payment in full.
Maness v. Meyers, 419 U.S. 449, 458, 95 S.Ct. 584, 42 L.Ed.2d 574 (1975) (emphasis added).
United States v. United Mine Workers of America, 330 U.S. 258, 293, 67 S.Ct. 677, 91 L.Ed. 884 (1947) (footnote omitted); see, e.g., Howat v. Kansas, 258 U.S. 181, 190, 42 S.Ct. 277, 66 L.Ed. 550 (1922) ("until [the] decision" of a court of competent jurisdiction "is reversed for error by orderly review, either by itself or by a higher court, its orders based on its decision are to be respected"); SEC v. Charles Plohn & Co., 433 F.2d 376, 379 (2d Cir. 1970) ("It is axiomatic that a court order must be obeyed, even assuming its invalidity, until it is properly set aside." (internal quotation marks omitted)).
In light of Pescatore's election to disregard these principles and disobey the Judgment, although we agree that he cannot be compelled to pay more than $2,559,611.79 as pure restitution, we cannot conclude that he has met the final prong of the plain-error test so as to require that he be given immediate relief from the $3 million figure, for a defendant's unexcused failure to comply with a restitution order has monetary (as well as other potential) consequences. See, e.g., 18 U.S.C. §§ 3572 (penalties), 3612 (penalties and interest); 3613 (civil enforcement), 3613A (inter alia, modification of supervised release terms; contempt of court), 3614 (resentencing).
The consequences most relevant to this appeal are the accrual of interest and penalties with respect to restitution payments not made when due. If a restitution payment of more than $2,500 is not made as ordered by the court, "[i]n general[, t]he defendant shall pay interest," 18 U.S.C. § 3612(f)(1). In addition, a "payment of restitution is delinquent if a payment is more than 30 days late," and is "in default if a payment is delinquent for more than 90 days." 18 U.S.C. §§ 3572(h) and (i). The penalties for delinquency and default are substantial:
18 U.S.C. § 3612(g) (emphases added); see also id. § 3612(i) ("Payments relating to fines and restitution shall be applied in the following order: (1) to principal; (2) to costs; (3) to interest; and (4) to penalties."). These penalties for default and delinquency are not paid to the defendant's victims, but rather become assets of the United States Treasury. See Administrative Office of the United States Courts, Guide to Judiciary Policy vol. 13, § 810.50.10(a)(2) (Aug. 3, 2010) ("Interest
Assuming that Pescatore has made no restitutionary payments during the pendency of this appeal, he has accumulated obligations of interest on the $2,559,611.79, as well as penalties that are sizeable. Thus, it is not clear that $3 million will exceed the sum of his victims's losses, the statutory interest to which the victims are entitled because of his delay in making payment, and the statutory penalties that may be applicable on account of that delay. In all the circumstances, although we agree that Pescatore cannot be compelled to pay more than $2,559,611.79 as pure restitution, we cannot conclude that he has met the final prong of the plain-error test in any way that requires that he be given immediate relief from the requirement that he pay $3 million.
We note that Pescatore acknowledged in his plea allocution that his chop shop operation began in 1987 and ended in mid-2004. Thus, his victims have been without compensation for their losses for the better part of a decade, or longer. We conclude that, in light of the choices made by Pescatore throughout this case, including:
we conclude that the interests of justice, fairness, and the public reputation of judicial proceedings are best served if Pescatore remains required to make the ordered $3 million payment, subject to his right to a refund of any moneys remaining after his victims have been paid restitution, with interest, and after whatever applicable restitution-related penalties have been satisfied.
We have considered all of Pescatore's arguments on this appeal and have found in them no basis for reversal. On remand, the district court will determine, inter alia, (a) the dates on which payments toward Pescatore's $3 million obligation are made or are otherwise satisfied by government seizure of his properties, (b) the amounts of interest accruing on any unpaid portion of the principal sum of $2,559,611.79 during Pescatore's periods of noncompliance with court-ordered deadlines, (c) the extent to which the statutory restitution-related penalties on such unpaid principal are applicable, and (d) if the total of restitution, interest, and restitution-related
The order of the district court (a) denying an order compelling restoration, and (b) denying immediate relief from the $3 million restitution order is affirmed. Pescatore is to make payment of $3 million within 60 days of the issuance of the mandate herein; interest on any unpaid portion of $2,559,611.79 shall not cease to accrue during that period. The matter is remanded to the district court for proceedings not inconsistent with this opinion.
The mandate shall issue forthwith.
