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United States v. Willis

United States District Court, D. New Mexico

October 26, 2018

UNITED STATES OF AMERICA, Plaintiff,
v.
BOBBY WILLIS, Defendant.

          MEMORANDUM OPINION AND ORDER ON RESTITUTION

         THIS MATTER comes before the Court following restitution hearings on June 27, 2018, and October 22, 2018. Following an evidentiary hearing on the amount of restitution and any offset to restitution, the Court FINDS that restitution is in the remaining amount of $776, 640, plus post-judgment interest. A restitution order shall not be issued until the matters of Defendant's ability to pay, and payment schedule, are resolved.

         BACKGROUND

         Defendant pled guilty to two counts of wire fraud pursuant to 18 U.S.C. § 1343. The victims transferred $1 million to Defendant to invest in a real-estate LLC on their behalf. Defendant pocketed $995, 000 and did not invest the money as promised. $5, 000 went to a third party for fees.

         At both restitution hearings, the parties agreed that the amount of actual loss was $1 million. Defendant did not object to the PSR factual finding that the amount of loss was $1 million. The Government also requested prejudgment interest at the federal statutory rate, and apparently Defendant took no position.

         Defendant and the victims entered into a settlement in a civil case involving this same fraud in the Second Judicial District, Bernalillo County, New Mexico. In the civil settlement, the parties agreed as follows:

G. Victim Restitution. The Lees acknowledge and agree that the consideration being provided to Plaintiffs hereunder constitutes full and complete restitution to which the Lees might otherwise be entitled in USA v. Willis, 15-CR-037640-MCA (Bobby Willis denies any guilt in USA v. Willis but is entering into this Agreement so that the Plaintiffs will be compensated for damages claimed in the Litigation).

Doc. 64-14, p. 3. As part of the settlement, Defendant (1) transferred real property, and (2) promised to pay $50, 000, to the victims. Defendant has paid at least $15, 000, and alleges to have paid $25, 000 on the promissory note.

         Paragraph 38 of the PSR provided:

According to defense counsel, the defendant has paid all but $35, 000 that were due under a Promissory Note. The Government advised that the defendant has given the victim's in this case a piece of property in the Farmington, New Mexico area that has been appraised at $223, 360.00 as part of a civil settlement. The settlement also included a promissory note for $45, 000 that has a remaining balance of $35, 000.

Doc. 55, ¶ 38. Defendant objected to the above, stating that restitution was paid in full by the civil settlement. Doc. 59. The PSR also provided that the total loss the victims was $1, 000, 000. At the sentencing hearing, the Court reserved addressing the amount of restitution until a subsequent hearing.

         The Government argues that the restitution amount should be $1 million, before any offset for the value of the property transferred to the Lees. The $1 million restitution amount, before considering any offsets, is supported by the admission in the plea agreement and the undisputed facts in the PSR. Defendant does not dispute the $1 million restitution amount, but instead argues that the real property, along with the $50k promissory note, satisfies his restitution obligation.

         A hearing was held on October 22, 2018 to determine the value of the property transferred to the Lees as part of the civil settlement.

         DISCUSSION

         The Mandatory Victim Restitution Act (“MVRA”) provides that the district “court shall order ... that the defendant make restitution to the victim of the offense.” 18 U.S.C. § 3663A(a)(1).

         “[A]n order of restitution imposed pursuant to the MVRA must be based on the ‘full amount of each victim's losses as determined by the court....'” United States v. Ferdman, 779 F.3d 1129, 1132 (10th Cir. 2015) (quoting 18 U.S.C. § 3664(f)(1)(A)). “When calculating loss under the MVRA, absolute precision is not required. A sentencing court may resolve restitution uncertainties with a view towards achieving fairness to the victim, so long as it still makes a reasonable determination of appropriate restitution rooted in a calculation of actual loss.” United States v. Gallant, 537 F.3d 1202, 1252 (10th Cir. 2008) (internal citations and quotation marks omitted). In calculating loss, “[s]peculation and rough justice are not permitted.” Ferdman, 779 F.3d at 1132.

         I. Amount of Actual Loss.

         A. General Law.

         “The burden of demonstrating the amount of loss sustained by the victim as a result of the offense shall be on ... the Government.” 18 U.S.C. § 3664(e). The PSR must contain “information sufficient for the court to exercise its discretion in fashioning a restitution order. The report shall include, to the extent practicable, a complete accounting of the losses to each victim....” Id. § 3664(a). “Any dispute as to the proper amount ... of restitution shall be resolved by the court by the preponderance of the evidence.” Id. § 3664(e). “A district court ‘may resolve restitution uncertainties with a view towards achieving fairness to the victim so long as it still makes a reasonable determination of appropriate restitution rooted in a calculation of actual loss.' ” Ferdman, 779 F.3d at 1133 (alteration omitted) (quoting Gallant, 537 F.3d at 1252). See generally United States v. Dickerson, 678 Fed.Appx. 706, 722 (10th Cir. 2017).

         B. $1 ...


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