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UNITED STATES v. CIAMBRONE

December 5, 1984

UNITED STATES OF AMERICA, against THOMAS J. CIAMBRONE, JR., JERRY A. CHAMBRONE, and JOSEPH VINCENT RIGGIO, JR.


The opinion of the court was delivered by: CARTER

CARTER, District Judge

On April 16, 1984, a jury convicted Thomas Ciambrone, Jr. and Jerry Chambrone of conspiracy and various counts of racketeering. 18 U.S.C. §§ 1951 and 1952. The government has moved for an order of restitution pursuant to the Victim and Witness Protection Act of 1982, 18 U.S.C. §§ 3579 and 3580 ("the Act"), which requires the court, as part of the sentence of each defendant, to order that he make restitution to each victim. If the court does not order restitution, it must state on the record its reasons for not doing so. Both defendants oppose the government's motion on the grounds that the Act violates the 5th, 7th and 8th amendments of the Constitution.

 At the time defendants filed their memoranda challenging the Act's validity, only one court had considered directly this constitutional challenge. United States v. Welden, 568 F. Supp. 516 (N.D. Ala. 1983), held that the Act violated the 7th, 5th and 14th amendments. Since the submission of this matter to the court, however, Welden has been reversed, sum nom. United States v. Satterfield, 743 F.2d 827 (11th Cir. 1984), and the Second Circuit has handed down United States v. Brown, 744 F.2d 905 (2d Cir. 1984) giving "unqualified approval to Congress' determination that victim restitution should be added to the sentencing options of federal judges." Id. at 6141. Following the two circuit court decisions, the court finds that the Act's imperfections do not rise to the level of constitutional transgressions.

 Nevertheless, for the reasons set out in the second portion of this opinion, an order of restitution will not issue on the present record before the court. Consistent with the provisions of the Act, the court finds a hearing is required on material questions of fact raised by defendants. The issues to be addressed at the hearing are defined below.

 Constitutional Challenge

 Due Process

 Defendants attack the Act's failure to detail the procedures to be followed in making an order of restitution. They maintain that the Act's vague provisions "open a Pandora's box of constitutional and practical problems in applying the statute," echoing the sweeping attack leveled by the district court in Welden. The Welden district court criticized Congress for granting "too much discretion to the courts and to the Attorney General . . . creat[ing] a potential Frankenstein." 568 F. Supp. at 534. Because, the court found, the restitution order was res judicata and collectible as other civil judgments, procedural safeguards additional to those recognized in §§ 3579 and 3580 were necessary. Unlike 18 U.S.C. § 3651, which allows restitution as a condition of probation, Judge Acker concluded that these sections were not "fair" or "reasonable" in authorizing a civil judgment against a person on the hearsay testimony of a witness without any discovery and without cross-examination. Id. at 535.

 Defendants also press the equal protection argument raised by the Welden district court. The court found that there was a high probability that disparate results would obtain from the application of §§ 3579 and 3580. 568 F. Supp. at 535. Specifically, defendants fault the Act for failing to specify the relative importance of the factors to be considered in determining whether to order restitution, and for failing to provide for the apportionment of restitution among defendants based on their relative culpability. among defendants based on their relative culpability.

 As a general comment, there is no doubt that §§ 3579 and 3580 are not among the more well-crafted bits of legislation to issue forth in recent years. Speed rather than care in construction seemed the Congress' dominant concern in passing the Act; President Reagan signed the Act into law on October 12, 1982, less than two months after it left Committee in the Senate. *fn1" But, in evaluating the charges that too many discretionary loopholes were left in the Act, as well as defendants' other constitutional attacks, the court must examine whether the Act can be construed so as to pass constitutional muster. See Village of Hoffman Estate v. Flipside, Hoffman Estate, 455 U.S. 489, 494 ,n.5, 71 L. Ed. 2d 362, 102 S. Ct. 1186 (1982) citing Steffel v. Thompson, 415 U.S. 452, 474, 39 L. Ed. 2d 505, 94 S. Ct. 1209 (1974) (law is facially unconstitutional only if incapable of valid application); International Ass'n of Machinists v. Street, 367 U.S. 740, 749, 6 L. Ed. 2d 1141, 81 S. Ct. 1784 (1961) (federal statutes are to be so construed as to avoid serious doubt of their constitutionality). There are enough limiting provisions in the Act which place it within constitutional bounds, especially if these are considered in light of the Act's legislative history and judicial constructions of 18 U.S.C. § 3651.

 The Act does not leave a void with respect to procedural guidelines for ordering restitution. Although the Act may be characterized as "procedurally conservative," *fn2" it clearly directs the court to follow certain steps in deciding the propriety and amount of a restitution order. Section 3580(a) prescribes that "the court . . . shall consider the amount of the loss sustained by any victim as a result of the offense, the financial resources of the defendant, the financial needs and earning ability of the defendant and the defendant's dependents, and such other factors as the court forms of sentencing require the court to take account of a variety of considerations about the defendant, including his background and financial situation without attaching specific weight to each piece of information. *fn3" The factors listed in the Act adequately define parameters of uniformity without infringing upon the individualized nature of the sentencing process. See Roberts v. United States, 445 U.S. 552, 556, 63 L. Ed. 2d 622, 100 S. Ct. 1358 (1980). As the government points out, it is the invidious exercise of discretion against which the court must guard, not the exercise of discretion per se.United States v. Batchelder, 442 U.S. 114, n.9, 124-25, 60 L. Ed. 2d 755, 99 S. Ct. 2198 (1979).

 Moreover, the Act provides a check on the accuracy of the material presented to the court.See Townsend v. Burke, 334 U.S. 736, 92 L. Ed. 1690, 68 S. Ct. 1252 (1948). The court must, pursuant to § 3580(c), disclose to both the defendant and the government all portions of the presentence or other report pertaining to the background factors described above. The defendant, as well as the government thus are afforded the opportunity to refute or supplement the information on which the court will rely in making a restitution determination. In addition, Rule 32(a)(1)(C), F.R.Cr.P. gives the defendant the opportunity "to make a statement in his own behalf and to present any information in mitigation of punishment." See Satterfield, supra, 743 F.2d at 839-41. *fn4"

 The Act also addresses the standard and burdens of proof in a determination of restitution. § 3580(d). The Act provides that the burden of proving, by a preponderance of the evidence, the amount of loss sustained by the victim is on the government, *fn5" while the burden of demonstrating, by the same standard, the financial resources of the defendant rests with the defendant. This distribution accords with general notions of justice. The burden is placed on the proponent of a motion, see United States v. Veon, 538 F. Supp. 237, 245-46 (E.D. Cal. 1982), and on the party to whom pertinent information is much more readily available. See Communist Party of United States v. United States, 118 U.S. App. D.C. 61, 331 F.2d 807 (D.C. Cir. 1963). It would not seem difficult for the court to assign similarly the burden of proof on other issues that might arise, as the Act provides, § 3580(d), and, therefore, it is not fatal that the Act does not spell out all possible allocations.

 The Act's so-called "res judicata " provision does not persuade the court that a full-scale trial, with attendant formal evidentiary and discovery rules is needed.The Act provides that "[a] conviction of a defendant for an offense involving the act giving rise to resitution . . . shall estop the defendant from denying the essential allegations of that offense in any subsequent Federal civil proceeding or State civil proceeding . . . brought by the victim." § 3580(e). The Committee's stated intention in enacting this provision was to "obviate a victim's need to establish a defendant's liability in a civil suit for punitive and/or compensatory damages." S. Rep. No. 532, 97th Cong., 2 Sess. 32, reprinted in 1982 U.S. Code Cong. and Ad. News, p. 2515, 2538. Thus, the Act emphasized the effect to be given to the conviction underlying the restitution order, but it did not, as Judge Acker, the District Judge in Welden implied, give additional effect to the restitution order itself. Satterfield, supra, 743 F.2d at 838.

 In any event, the provision was not a necessary step in achieving the Committee's goal. Criminal convictions operate as collateral estoppel in favor of a plaintiff in a civil suit against the same defendants. United States v. Podell, 572 F.2d 31, 35 (2d Cir. 1978). The impact of this provision ...


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