US v. Kenneth Harvey, No. 09-4970 (4th Cir. 2010)
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UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 09-4970 UNITED STATES OF AMERICA, Plaintiff - Appellee, v. KENNETH N. HARVEY, Defendant Appellant. No. 09-5030 UNITED STATES OF AMERICA, Plaintiff - Appellee, v. MICHAEL G. KRONSTEIN, Defendant Appellant. Appeals from the United States District Court for the Western District of Virginia, at Charlottesville. Norman K. Moon, Senior District Judge. (3:06-cr-00023-nkm-mfu-1; 3:06-cr-00023nkm-2) Submitted: November 29, 2010 Decided: December 16, 2010 Before WILKINSON, AGEE, and KEENAN, Circuit Judges. Affirmed by unpublished per curiam opinion. Larry W. Shelton, Federal Public Defender, Frederick T. Heblich, Jr., Assistant Federal Public Defender, Christine Madeleine Lee, Research and Writing Attorney, Charlottesville, Virginia; Franklin B. Reynolds, Jr., FRANKLIN B. REYNOLDS, JR., P.C., Washington, Virginia, for Appellants. Lanny A. Breuer, Assistant Attorney General, Greg D. Andres, Acting Deputy Assistant Attorney General, Jack Smith, Edward J. Loya, Jr., UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee. Unpublished opinions are not binding precedent in this circuit. 2 PER CURIAM: A jury convicted Kenneth N. Harvey and Michael G. Kronstein of honest services wire fraud and bribery arising from a scheme in which Harvey, a civilian employee with U.S. Army Intelligence and Security Command (INSCOM), orchestrated the award of a sole-source contract to Program Contract Services, Inc. ( PCS ), a corporation wholly owned and controlled Kronstein, in exchange for financial remuneration. we affirmed vacated a the defendants restitution convictions award and and On appeal, sentences remanded by for but further United States v. Harvey, 532 F.3d 326 (4th Cir. proceedings. 2008). On remand, the hearing and awarded restitution $319,923.30. Harvey district and court to held INSCOM Kronstein have an in evidentiary the again amount appealed. of We affirm. In Government our had previous failed to opinion, prove we actual concluded loss, as that required the for restitution awards under 18 U.S.C.A. § 3663 (West 2000 & Supp. 2010). Harvey, 532 F.3d at 339-40. We held that PCS s gain was not a permissible proxy for actual loss and remanded so that [the district court] may determine whether the amount of loss can be calculated. Id. at 341. On remand, the district court ordered briefing and held an evidentiary hearing, at which the Government presented testimony from two witnesses. 3 After the hearing, the restitution Government s district to the theory court issued Government. that the a written The contract order court was awarding rejected the unnecessary but adopted the theory that the Government paid for nine employees in 1999 but received the services of only six. The court specifically found (1) that PCS s contract was a level-of-effort contract, not a firm-fixed-price contract; (2) that Kronstein s contract proposal identified nine positions but filled only six; (3) that Kronstein submitted work invoices to INSCOM billing for a total of nine employees; and (4) that Harvey approved payment for the invoices. Harvey and Kronstein make two arguments on appeal. First, they argue that the district court violated the mandate rule in awarding restitution. In the alternative, they argue that the district court s new restitution order is an abuse of discretion. The mandate rule is merely a specific application of the law of the case doctrine, which forecloses relitigation of issues expressly or impliedly decided by the appellate court. United States v. Bell, 5 F.3d 64, 66 (4th Cir. 1993) (internal quotation marks omitted). Although the doctrine applies both to questions actually decided as well as to those decided by necessary implication, it does not reach questions which might have been decided but were not. 4 Sejman v. Warner-Lambert Co., 845 F.2d 66, 69 (4th Cir. 1988) (internal quotation marks omitted). Applying that the district court did not violate the mandate rule on remand. Our prior opinion restitution: proxy for negative. actual standards, decided only a we conclude single question regarding whether a defendant s gain could be used as a actual loss, and answered that question in the In so doing, we noted that there was no evidence of loss although these presented there was during testimony trial that or PCS sentencing failed to and that, comply with certain aspects of the contract by, for example, failing to hire the contractually required number of employees, there was no testimony to establish the amount of loss INSCOM actually suffered. 532 Harvey, F.3d at 340. We also concluded, however, that INSCOM was appropriately considered a victim for restitution purposes and remanded for the district court to determine whether the amount of actual loss can be calculated and, [i]f so . . . whether . . . new restitution orders should issue and in what amount and form. Id. at 341. On remand, the Government offered testimony regarding two potential theories supporting restitution, and we find the district court restitution did based not on violate this the mandate testimony. Our rule in earlier awarding opinion mentioned that the Government had previously submitted evidence 5 that PCS did not have the requisite number of employees but that the Government had failed to show an actual loss emanating from PCS s failure. We did not decide whether the Government could ever establish loss from PCS s failure to hire the requisite employees and the Government was clearly permitted to put forth such evidence, which it did with the testimony. Our earlier opinion stated only that the district court erred by equating PCS s gain with INSCOM s loss; on remand, the district court fully complied with our mandate in holding an evidentiary hearing and awarding restitution based upon the amount of actual loss to INSCOM. Harvey and Kronstein argue in the alternative that the district court again abused its discretion in awarding restitution. We review court-ordered restitution for abuse of discretion. United States v. Vinyard, 266 F.3d 320, 325 (4th Cir. 2001). A district court may impose restitution in any case resulting in harm to a victim. (a)(2). In awarding 18 U.S.C.A. § 3663(a)(1)(A), restitution, the district court must determine the amount of loss sustained by any victim. U.S.C.A. § 3664(a) (West 2000 & Supp. 2010). bears the burden of proving preponderance of the evidence. We hold that the the amount of 18 The Government restitution by a Harvey, 532 F.3d at 339. district court did not discretion in awarding $319,923.30 in restitution. 6 abuse its Harvey and Kronstein note that three INSCOM employees testified during trial that the contract was a firm-fixed-price contract. None, however, was responsible for the direct administration of the contract. The contracting officer, in contrast, testified that the contract was a firm-fixed-price, level-of-effort contract with a ceiling for the number of hours the Government would pay. In addition, the contract itself contained the notation FFP-LOE, bolstering the reliability of this construction of the contract. Harvey and Kronstein also contend that the district court incorrectly found that PCS was required to supply nine employees by examining the included in the contract. contract proposal was part contract proposal, which was not The district court found that the of the contracting officer s testimony. contract, based upon the In addition, during the period when PCS submitted detailed invoices, those invoices applied the rates in the contract proposal. Accordingly, restitution award. facts and materials legal before we affirm the district court s We dispense with oral argument because the contentions are adequately the and argument court presented would not in the aid the decisional process. AFFIRMED 7
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