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United States v. Bartz

United States District Court, Second Circuit

January 7, 2014


ORDER (Docs. 108, 115)

GARVAN MURTHA, District Judge.

I. Introduction

On June 4, 2012, Clifford Bartz moved to dismiss a portion of his restitution obligations based on a victim's bankruptcy. (Doc. 108.) On July 31, 2012, Bartz moved to terminate restitution altogether. (Doc. 115.) The Government opposes both motions (Docs. 109, 118) and a hearing was held on October 10, 2012 (Doc. 122). The parties spent the next year in settlement discussions but were unable to come to an agreement. See Doc. 132. Accordingly, the matters are now ripe for decision. For reasons set forth more fully below, the motions are DENIED.

II. Background In 1995, after Bartz pleaded guilty to a range of offenses including robbery, firearms possession, and intimidation of a witness, the Court sentenced him to 240 months in prison and ordered $147, 690.52 in restitution. (Doc. 103 at 12-13.) Bartz served approximately 17 years and was released in April 2012. (Doc. 118 at 1.) While in prison he made restitution payments and has continued to do since his release. Id .; Doc. 115 at 2. Bartz's conditions of supervised release, which he will be subject to until April 2015, require him to make restitution payments of "at least" ten percent of his gross monthly income. (Doc. 110 at 1.) While in prison, Bartz inherited his parents' home in Barnstable, Massachusetts (assessed at $207, 000), and received an estate distribution of at least $35, 000.[1] (Doc. 118 at 2.) The Probation Office requested Bartz apply approximately half the distribution amount towards his restitution obligation. (Doc. 110 at 1.) Bartz refused, and the motions to dismiss a portion of his restitution (Doc. 108) or, alternatively, terminate it altogether (Doc. 115), followed shortly thereafter. As of September 7, 2012, Bartz owed $117, 257.85 (Doc. 118 at 1), although he has made at least 13 monthly payments of varying amounts since then.

III. Discussion

The restitution issue has been raised at least five times since sentencing. See United States v. Bartz, 1:94-cr-87, 2011 WL 3042377, at *1 (D. Vt. July 25, 2011). Bartz raises two legal arguments in his motion to terminate restitution: the first claims the restitution order is illegal and the Court should now terminate the order under 18 U.S.C. § 3583(e)(2); the second contends the Government may only collect restitution for five years after the date of sentencing and therefore, the restitution order must be terminated as a matter of law. (Doc. 115.) Finally, Bartz also moves to dismiss a portion of his restitution obligation, arguing he should not pay restitution to one of his victims because it went bankrupt. (Doc. 108.) The Court will address these in turn.

A. The Alleged Illegality of the Restitution Order

First, Bartz claims the Court's 1995 order of restitution was "illegal" because it did not consider his financial circumstances. (Doc. 115 at 3.) Bartz argues that under 18 U.S.C. § 3583(e)(2), the Court now has the authority "to modify, or in this case terminate, its Order of Restitution as a condition of supervised release." Id. at 4. In response, the Government contends that as a preliminary matter, the "law of the case" doctrine prevents Bartz from "re-litigating... the alleged illegality of the restitution order" because the Court has already ruled on this issue. (Doc. 118 at 3 n.2.) The Government further characterizes Bartz's motion as an impermissible "request to alter his sentence disguised as a motion to modify a condition of supervised release" and, in any event, claims Bartz has not met the standard to modify the conditions of his supervised release under § 3583(e). Id. at 2-3.

The Court agrees with the Government: Bartz has previously raised, and the Court has previously ruled on, the same issues now before it yet again. Three years ago, Bartz filed a "Writ of Hardship" and argued restitution should not have been ordered because the Court failed to consider his ability to pay. Bartz v. United States, 1:94-cr-87, 2010 WL 1286667, at *2 (D. Vt. Mar. 26, 2010). In that case, the Court denied Bartz's motion because he did not contend the sentencing was invalid "due to errors of the most fundamental character'" or "explain why he did not challenge the restitution either on direct appeal or in a timely post-judgment motion." Id . (quoting Foont v. United States , 93 F.3d 76, 78 (2d. Cir. 1996)). And two years ago, the Court denied Bartz's request to again revisit the restitution obligation in his conditions of supervised release under 18 U.S.C. § 3583(e)(2), which gives the district court the power to "modify, reduce, or enlarge the conditions of supervised release." United States v. Bartz, 1:94-cr-87, 2011 WL 3042377, at *1 (D. Vt. July 25, 2011) (internal quotation marks omitted). Bartz appealed that decision and the Second Circuit summarily affirmed, issuing its Mandate on March 12, 2012. (Doc. 106.)

Bartz has not presented sufficient reasons for the Court to reconsider - let alone depart from - its 2010 or 2011 decisions; indeed, he fails to address the Court's previous rulings on this issue at all. Under the law of the case doctrine, if "a court reconsiders its own ruling on an issue in the absence of an intervening ruling on the issue by a higher court... that decision should generally be adhered to by that court in subsequent stages in the same case unless cogent and compelling reasons militate otherwise." United States v. Quintieri , 306 F.3d 1217, 1225 (2d Cir. 2002) (internal quotation marks and citations omitted). The trial court must also "follow an appellate court's previous ruling on an issue in the same case." Id. at 1225. Accordingly, under the "mandate rule, " this Court may not depart from the Second Circuit's Mandate affirming the 2011 ruling. Id . Even were the Court to consider the merits, Bartz's argument fails for the same reasons the Court stated in 2011: § 3583(e)(2) does not provide the Court with the authority to terminate his restitution obligation.[2] Terminating Bartz's restitution obligation would impermissibly alter his sentence. See, e.g., United States v. Kyles , 601 F.3d 78, 83 (2d Cir. 2010) ("It is well-established that a district court may not alter an imposed sentence, except in narrow circumstances not present here."). Furthermore, as the Government points out, "[t]he plain language of subsection 3583(e)(2) indicates that the illegality of a condition of supervised release is not a proper ground for modification under this provision." (Doc. 118 at 11 (quoting United States v. Lussier , 104 F.3d 32, 34 (2d Cir. 1997).) Bartz is therefore precluded from re-litigating the alleged illegality of his restitution obligation.

B. Restitution Time Limits Under the Victim and Witness Protection Act

Second, Bartz claims the restitution order must be terminated as a matter of law because under the Victim and Witness Protection Act, 18 U.S.C. § 3663 ("VWPA") (in effect at the time of Bartz's sentencing), the Government may only collect restitution for five years after the date of sentencing. (Doc. 115 at 6.) He relies primarily on United States v. Holland , 380 F.Supp.2d 1264 (N.D. Ala. 2005), in support of this argument. Section 3663(f)(2) of the VWPA provided that if a district court required a defendant to make restitution "within a specified period or in specified installments[, ] [t]he end of such period or the last of such installment shall not be later than[:] (A) The end of the period of probation, if probation is ordered; (B) Five years after the end of imprisonment imposed, if the court does not order probation; and (C) Five years after the date of sentencing in any other case." See Holland , 380 F.Supp.2d at 1269-70. The Holland Court interpreted this section as "clearly provid[ing] a five-year time limit on all restitution obligations" when it held that the defendant's obligations had expired as a matter of law under § 3663(f)(2)(C). Id. at 1269.

Other circuits, however, have a markedly different interpretation of § 3663. In United States v. Berardini , 112 F.3d 606 (2d Cir. 1997), the Second Circuit held that restitution orders under the VWPA are enforceable for up to 20 years from the date of sentencing because, under § 3663(h), restitution orders may be enforced "in the same manner as a judgment in a civil action" by either the government or a victim named in the restitution order. 112 F.3d at 611. The First, Sixth, Seventh, Ninth, and Eleventh Circuits have similarly found that § 3663(f)(2) does not prohibit the government from collecting restitution after five years. See Doc. 118 at 8 (citing cases); FDIC v. Dover , 453 F.3d 710, 716-17 (6th Cir. 2006) (same).

The First Circuit resolved the apparent confusion between §§ 3663(f) and 3663(h) by explaining that while "subsection (f) controls the authority of the sentencing court... [and] simply authorizes the sentencing court to impose an order of restitution, " subsection (h) governs enforcement of the restitution. United States v. Rostoff , 164 F.3d 63, 66-67 (1st Cir. 1999) (emphasis in original). In other words, if the sentencing court does not make restitution due immediately and instead "elect[s] to make restitution due in installments, or at the end of a specified period[, ] [t]he sentencing court's discretion in this regard is constrained: payment must fall due by the end of the period of supervised release." Id. at 66 (citing § 3663(f)(1)) (emphasis in original). That an installment payment must be due by a specified period of time, however, does not mean the restitution order simply expires on that date. See id. ("Common sense dictates that failure to pay at the time due renders payment overdue; it does not abate the obligation entirely."); United States v. ...

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