US v. Joseph DiBruno, Sr., No. 08-4996 (4th Cir. 2011)

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UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 08-4996 UNITED STATES OF AMERICA, Plaintiff Appellee, v. JOSEPH DIBRUNO, SR., Defendant Appellant. Appeal from the United States District Court for the Western District of North Carolina, at Charlotte. Frank D. Whitney, District Judge. (3:06-cr-00430-FDW-2) Submitted: June 10, 2011 Decided: July 13, 2011 Before NIEMEYER, MOTZ, and KING, Circuit Judges. Dismissed and remanded curiam opinion. with instructions by unpublished per David Q. Burgess, LAW OFFICE OF DAVID Q. BURGESS, Charlotte, North Carolina, for Appellant. Anne M. Tompkins, United States Attorney, Amy E. Ray, Assistant United States Attorney, Asheville, North Carolina, for Appellee. Unpublished opinions are not binding precedent in this circuit. PER CURIAM: This case addresses the survivability of an order of restitution following the death pending appeal of a convicted criminal defendant. For the reasons that follow, we dismiss the appeal and remand with instructions. I. From 1999 through July 2005, Joseph DiBruno, Sr. ( DiBruno ), and his sons Joseph, Jr., and Nicholas organized and incorporated various corporations and entities, soliciting investors with promises of high rates of return. entities shell were operational entities designed businesses, to allow but Some of these others DiBruno and were his merely sons to solicit monies from unsuspecting investors. DiBruno and his sons the did not businesses; personal invest rather, they expenditures, million dollars. investors used funds the defrauding into funds they investors operational solicited of over for three In August 2007, a federal grand jury returned a second superseding indictment charging DiBruno and his sons with, among other offenses, conspiracy to defraud the United States, in violation of 18 U.S.C. § 371 (2006). DiBruno pled guilty, pursuant to a written plea agreement, to the conspiracy charge. 2 Prior to sentencing, DiBruno moved to withdraw his guilty plea, but the district court denied the motion after a hearing at which DiBruno testified. Based on his testimony at the hearing, the district court found DiBruno guilty of criminal contempt, see 18 U.S.C. § 401 (2006); Fed. R. Crim. P. 42(b). The court sentenced DiBruno to sixty months imprisonment on the conspiracy count, ordered that he pay a $100 special assessment, and ordered that he pay restitution, jointly and severally with his co-defendant sons, in the amount of $3,808,487. also sentenced DiBruno to six months The court imprisonment on the contempt count, to be served consecutively to the sixty-month prison term on the conspiracy count. DiBruno timely appealed the judgment of conviction and the district court s order of contempt. In February 2009, while DiBruno s appeal was pending in this court, but before filing an opening appellate brief, DiBruno s counsel filed a suggestion of death, informing us that DiBruno had died. appeal as moot. The Government then moved to dismiss the In response, DiBruno s counsel concurred with the Government s conclusion that the appeal should be dismissed as moot as a result of DiBruno s death. Counsel further asserted that the case should be remanded to the district court with instructions to vacate DiBruno s convictions and dismiss the indictment against him. 3 The parties disagreed, however, over the appropriate resolution of the order of restitution, and we directed them to file briefs addressing this issue. Having reviewed those briefs and the the submissions relative to Government s motion to dismiss, we conclude that, although DiBruno s convictions and sixty-six month prison sentence abate as a result of his death pending appeal, the restitution order survives. II. In United States v. Dudley, 739 F.2d 175, 176 (4th Cir. 1984), this court held that the death of an appellant pending an appeal of his criminal conviction results in the abatement of not only the appeal but all proceedings in the prosecution from its inception. In such a case, the appeal is to be dismissed and the case remanded to the district court with instructions to vacate the judgment of conviction and dismiss the indictment. An exception to this general directive Id. exists, however, as to any order of restitution included within the criminal judgment. Id. at 178. In judgment this case, of conviction DiBruno and the timely district appealed court s both order the of criminal contempt, and the appeal was pending in this court at the time of DiBruno s death. Although DiBruno died before his counsel filed an opening appellate brief raising any issues for 4 review, there existed at the time of DiBruno s death at least the possibility that his convictions might be overturned. See United States v. DeMichael, 461 F.3d 414, 417 (3d Cir. 2006) ( When a defendant appeals the judgment of conviction itself . . . or files a general notice of appeal but dies before submitting an opening brief, the possibility remains that the conviction Pogue, 19 itself F.3d might 663, be 665 overturned. ); (D.C. Cir. United 1994) States (per v. curiam) ( [A]ppellant had filed a timely appeal before his death; the appeal was not withdrawn; and, had he lived, appellant could have challenged the plea agreement and underlying conviction. ). In view of this possibility, we conclude that DiBruno died pending the appeal of his conspiracy and contempt convictions. Accordingly, the general rule of abatement applies, and we therefore grant the Government s motion to dismiss the appeal as moot. We also remand to the district court with instructions to vacate DiBruno s convictions and sixty-six month prison sentence and to dismiss the second superseding indictment as to DiBruno. See Dudley, 739 F.2d at 176. However, fee assessments already paid need not be refunded because they are the equivalent of prison time already served; therefore, the rule of abatement does not apply to any payments already made on the $100 special assessment, and we further instruct that the Government not be ordered to refund any such payments 5 to DiBruno s estate. See United States v. Zizzo, 120 F.3d 1338, 1346-47 (7th Cir. 1997). III. With respect to the order of restitution, DiBruno s counsel suggests that it, too, should abate because failure to abate the order would contravene the principle that death pending appeal abates all proceedings in the prosecution from its inception. restitution Counsel order to also survive suggests that DiBruno s allowing death would the create statutory inconsistency because the acts governing restitution, the Victim and Witness Protection Act of 1982, as amended ( VWPA ), see 18 U.S.C. § 3663 (2006), and the Mandatory Victims Restitution Act of 1996 ( MVRA ), Pub. L. No. 104-132, §§ 20111, 110 Stat. 1214, 1227-41 (codified in relevant part at 18 U.S.C. §§ 3663A, 3664 (2006)), authorize restitution only for those who are convicted of criminal offenses. We disagree. A. We have previously concluded that orders of restitution do not abate by reason of the death of a convicted criminal defendant who dies Dudley, 739 F.2d at 177-78. the court in Dudley, while his appeal his pending. As Judge Murnaghan explained for [t]he argument that impositions of penalties in criminal cases have heretofore always been abated 6 on death of the accused . . . grows out of the consideration that punishment, incarceration, or rehabilitation have heretofore largely been the exclusive purposes of sentences and so ordinarily should be abated upon death because shuffling off the mortal coil completely forecloses punishment, incarceration, or rehabilitation, this side of the grave at any rate. Id. at 177. Recognizing that [i]t is an old and respected doctrine of the common law that a rule ceases to apply when the reason for it[] dissipates, the court held that the rule of because abatement such convictions orders, and predominantly should thus not apply to orders although contained in respects some compensatory purpose of of in restitution judgments penal, reducing have the impact [of the defendant s crimes] on the victim. of the adverse Id. Although the Courts of Appeals are divided on whether an order of restitution abates when a convicted criminal defendant dies pending direct appeal, compare United States v. Christopher, 273 F.3d 294, 298-99 (3d Cir. 2001) (holding restitution order does not abate); United States v. Johnson, Nos. 91-3287, 91-3382, 1991 WL 131892, at *1 (6th Cir. July 18, 1991) (same); Dudley, 739 F.2d at 178 (same), with United States v. Rich, 603 F.3d 722, 728-31 (9th Cir. 2010) (holding restitution order does abate); United States v. Estate of Parsons, 367 F.3d 409, 415 (5th Cir. 2004) (en banc) (same); 7 United States v. Logal, 106 F.3d 1547, 1552 (11th Cir. 1997) (same), Dudley is controlling dictates the result here. Circuit precedent and thus See United States v. Rivers, 595 F.3d 558, 564 n.3 (4th Cir. 2010) ( [A] panel of this court cannot overrule, explicitly or implicitly, the precedent set by a prior panel of this court. Only the Supreme Court or this court sitting do en omitted)). banc can that. (internal quotation marks The Dudley decision explicitly excepted orders of restitution from the general rule that [d]eath pending appeal of a criminal conviction abates not only the appeal but all proceedings in the prosecution from its inception. F.2d at 176-78. Dudley, 739 Counsel s first claim is thus foreclosed by Dudley and therefore fails. B. Counsel also suggests that, the Dudley decision notwithstanding, allowing the order of restitution to survive DiBruno s death would create statutory inconsistency because the VWPA and defendants the MVRA authorize who have been restitution convicted of only for criminal those offenses. Counsel thus posits that where a defendant s conviction never becomes final as a result of his death pending appeal, the statutes provide no authority for the defendant to be required to pay restitution. In the absence of such authority, counsel 8 urges, the restitution component of a defendant s sentence also must abate. Restitution is a statutory remedy based in the VWPA and the MVRA. Enacted in 1982, the VWPA authorized, but did not require, district courts to order restitution to victims when sentencing defendants convicted of criminal offenses. 18 U.S.C. § 3663(a)(1)(A) defendant ( The court, when sentencing a convicted of an offense under this title . . . may order, in addition to . . . any other penalty authorized by law, that the defendant make restitution (emphasis added)). restitution convicted of § 3663A(a)(1), defendant any victim of such offense. In 1996, the MVRA, which supersedes the VWPA in part, was enacted. order to to The MVRA requires a district court to victims certain criminal (c)(1)(A)(ii), convicted of when an sentencing offenses. (B) 18 ( [W]hen offense defendants U.S.C. sentencing [committed by fraud a or deceit[] or . . . in which an identifiable victim or victims has suffered a . . . pecuniary loss], the court shall order, in addition to . . . any other penalty authorized by law, that the defendant make restitution to the victim of the offense. (emphasis added)). Counsel s argument that these statutes provide no authority for a decedent defendant s estate to be required to pay restitution proceeds from 9 the premise that the term convicted has a specific temporal thrust. Dudley, however, countenanced the view that the import of the term convicted is provided by the context in which term is used, and that the pertinent context was when [the district court was] sentencing Dudley. At sentencing in October 1983, Dudley stood convicted of one drug distribution and several food stamp offenses and was ordered, pursuant to the VWPA, to pay restitution. F.2d at 175-76. And although this court Dudley, 739 abated Dudley s convictions as the result of his death pending appeal, the court did not abate the order of restitution, even though Dudley s convictions were voided as a result of the abatement. Id. at 177-78. While Dudley issued before the enactment of the MVRA, the court s adoption of this view of the temporal thrust of the term convicted applies to orders of restitution issued, as here, under the MVRA. interpretation that It is a bedrock principle of statutory statutes that are in pari materia or relating to the same subject matter are to be interpreted in light of, and consistently with, one another. Stewart, 311 U.S. 60, 64 (1940). especially applicable when United States v. This interpretive principle is two statutes adopt vocabulary in reference to the same subject matter. Oscar Mayer & Co. v. Evans, 441 U.S. 750, 756 (1979). 10 the same See, e.g., Here, the MVRA adopts the same vocabulary when sentencing a defendant convicted of an offense as used in the VWPA to refer to the same subject matter, namely, the temporal condition precedent for a court to order the defendant to pay restitution. As Dudley interprets the term convicted as used in the VWPA with reference to this temporal context, the in pari materia canon directs adoption of the same construction of the term as used in the MVRA. DiBruno stood Applying this approach here, because convicted of the conspiracy offense during sentencing and was ordered during sentencing to pay restitution to the victims of that offense, the restitution order is valid and thus survives the abatement of DiBruno s convictions following his death. C. Adopting the position of DiBruno s counsel would, we believe, contravene Congress intent to require Federal criminal defendants crimes. to compensate the identifiable victims of their In Dudley, this court held a restitution order under the VWPA has the predominantly compensatory purpose of reducing the adverse impact [of the defendant s crimes] on the victim. Dudley, 739 F.2d at 177. amended, confirms that A review of the MVRA and VWPA, as restitution compensatory in nature. 11 orders continue to be The MVRA amended the VWPA to provide that restitution orders under the VWPA are to be issued and enforced in accordance with 18 U.S.C. § 3664, the enforcement provision of the MVRA. 18 U.S.C. § 3663(d). In each restitution order under the MVRA and the VWPA, as amended, the district court must 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 § 3664(f)(1)(A). of the Additionally, defendant. under the 18 MVRA and U.S.C. VWPA, as amended, the district court s order of restitution creates a property right for the victim that has the effect of a civil judgment against the convicted criminal defendant or his estate. An order of § 3663(a)(1)(A), restitution is assignable, 18 a heritable, U.S.C. 18 § 3664(g)(2), U.S.C. civil judgment in favor of such victim, id. § 3664(m)(1)(B), and, when properly registered or recorded, shall operate as a lien on the property of the defendant . . . in the same manner and to the same extent and under the same conditions as a judgment of a court of general jurisdiction, id. Further, an order of restitution carries the civil effects of joint and several liability, collateral estoppel, and subrogation. a victim s liable for Where, as here, multiple defendants contribute to loss, the payment district of the court full 12 may make restitution each defendant amount. Id. § 3664(h). A defendant ordered to make restitution is estopped from denying the essential allegations of the offense in any subsequent civil proceeding. Id. § 3664(l). Additionally, an insurer or other person who compensates the victim for any loss covered by payment, a be restitution subrogated restitution debtor. order to may, the to the victim s extent the against right of the Id. § 3664(j)(1). Other provisions of the MVRA and VWPA, as amended, protect the defendant restitution order. from possible punitive effects of a For instance, in the case of property loss to the victim, the restitution order may require only a return of the property or payment equal to the value of the property loss. 18 U.S.C. §§ 3663(b)(1), 3663A(b)(1). bodily injury compensate the to the victim victim, only the for restitution certain, incurred as a result of the offense. 3663A(b)(2)-(3). Further, any In the case of order enumerated may expenses Id. §§ 3663(b)(2)-(3), restitution amount paid to a victim under a restitution order must be reduced by the victim s recovery for the same loss in civil proceedings. 18 U.S.C. § 3664(j)(2). These provisions make clear that an order of restitution under the MVRA or the VWPA, as amended, is expressly non-punitive and the equivalent of a civil judgment against a criminal defendant requiring that he compensate his victims for 13 the specific harms he has done to them by his offenses. See United States v. Bach, 172 F.3d 520, 523 (7th Cir. 1999) (stating that the MVRA requires that definite persons are to be compensated for successful tort under MVRA, the definite losses plaintiffs ). like their just as Because VWPA if the orders persons of predecessors, were restitution are meant to compensate victims of crime, they do not abate with the death of a convicted criminal defendant pending appeal. F.2d at 177-78. We thus reject counsel s See Dudley, 739 second claim and instruct the district court on remand to leave unaffected the order of restitution. IV. Accordingly, the Government s motion to dismiss appeal is granted and the appeal is dismissed as moot. the The case is remanded to the district court with instructions to vacate DiBruno s convictions and sixty-six month prison sentence, dismiss the second superseding indictment as to him, and leave unaffected the order of restitution and any paid portion of the special assessment. facts and materials legal before We dispense with oral argument because the contentions are adequately the and argument court presented would not in the aid the decisional process. DISMISSED AND REMANDED WITH INSTRUCTIONS 14

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