Her Majesty the Queen in Right of Canada v. United States District Court , 785 F.3d 1273 ( 2015 )

FILED
FOR PUBLICATION MAY 12 2015
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
In re: HER MAJESTY THE QUEEN IN No. 15-71346
RIGHT OF CANADA.
D.C. No. 2:14-cr-00006-APG-
GWF
HER MAJESTY THE QUEEN IN RIGHT
OF CANADA,
OPINION
Petitioner,
v.
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEVADA, LAS
VEGAS,
Respondent,
NATHAN “NATI” STOLIAR aka
NATAN STOLIAR; CLARK COUNTY
D.A. OFFICE; YAKOV HEFETZ;
ROBERT CASEY; AD ASTRA
ENERGY, INC.; UNITED STATES OF
AMERICA,
Real Parties in Interest.
Petition for Writ of Mandamus
Submitted May 12, 2015*
San Francisco, California
Before: GOODWIN, FARRIS, and FRIEDLAND, Circuit Judges.
PER CURIAM:
This is a petition for a writ of mandamus filed pursuant to the Crime
Victims’ Rights Act (“CVRA”), 18 U.S.C. § 3771.
Defendant Nathan Stoliar was convicted and sentenced on April 9, 2015, for
conspiracy to commit criminal offenses and to defraud the United States in
violation of 18 U.S.C. § 371; conspiracy to launder monetary instruments in
violation of 18 U.S.C. § 1956(h); two counts of wire fraud and aiding and abetting
in violation of 18 U.S.C. §§ 1343 and 2; and making false statements related to the
Clean Air Act and aiding and abetting in violation of 42 U.S.C. § 7413(c)(2)(A)
and 18 U.S.C. § 2. Stoliar’s convictions were based on fraudulent schemes
involving the false generation of renewable fuel credits under United States law,
false representations regarding the type of fuel being sold, and the export of
biodiesel without retiring or purchasing renewable energy credits adequate to cover
the exported amount as required under United States law.
*
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
2
On February 18, 2015, counsel for Canada’s Department of Justice filed a
letter in the district court, asserting that Canada was a victim of Stoliar’s crimes,
and seeking a share in restitution. On April 2, 2015, petitioner Her Majesty the
Queen in Right of Canada (“Canada”) filed in the district court a petition for an
order of restitution from Stoliar in the amount of 1,233,065.32 CAD. Stoliar was
sentenced on April 9, 2015, and the district court heard argument on Canada’s
petition.1 On April 21, 2015, the district court entered an order denying restitution
to Canada. On May 4, 2015, Canada filed this petition, timely challenging the
denial of restitution.
In reviewing CVRA mandamus petitions, this court does not balance the
factors outlined in Bauman v. United States District Court, 557 F.2d 650, 654-55
(9th Cir. 1977). See Kenna v. U.S. Dist. Court, 435 F.3d 1011, 1017 (9th Cir.
2006). Rather, we “must issue the writ whenever we find that the district court’s
order reflects an abuse of discretion or legal error.” Id.
1
Both real parties in interest note petitioner’s failure to obtain the sentencing
transcript and file it in support of the CVRA petition, and Stoliar contends that the
petition may be summarily denied on the ground that petitioner has failed to
provide an essential part of the record. See Fed. R. App. P. 21(a)(2)(C); see also,
e.g., Syncom Capital Corp. v. Wade, 924 F.2d 167, 169 (9th Cir. 1991) (per
curiam). Although counsel for petitioner was remiss in not obtaining the
transcript, the record and the district court’s written order enable us to review this
petition on the merits.
3
This petition is filed under the CVRA, but the CVRA is not a substantive
basis for an award of restitution. Rather, it confirms that a crime victim has a right
to “full and timely restitution as provided in law.” 18 U.S.C. § 3771(a)(6).2 A
petitioner seeking restitution under the CVRA must also rely on a substantive
restitution statute. Petitioner sought restitution pursuant to the Mandatory Victims
Restitution Act (“MVRA”), 18 U.S.C. § 3663A(a)(1), (c)(1). The MVRA requires
restitution to victims of offenses against property, “including any offense
committed by fraud or deceit.” 18 U.S.C. § 3663A(c)(1)(A)(ii).3 The amount of
loss for the purpose of setting restitution must be proved by a preponderance of the
evidence. United States v. Gamma Tech Indus., 265 F.3d 917, 924 (9th Cir. 2001).
Stoliar was convicted of crimes that require proof of a “scheme, conspiracy,
or pattern of criminal activity,” so restitution may be ordered for all persons
directly harmed by the entire scheme. Such restitution is not limited to harm
2
It also provides, inter alia, the procedure for this mandamus petition,
18 U.S.C. § 3771(d)(3), and defines who is a “crime victim” protected by the
CVRA, 18 U.S.C. § 3771(e).
3
The MVRA further provides that “the term ‘victim’ means a person
directly and proximately harmed as a result of the commission of an offense for
which restitution may be ordered including, in the case of an offense that involves
as an element a scheme, conspiracy, or pattern of criminal activity, any person
directly harmed by the defendant’s criminal conduct in the course of the scheme,
conspiracy, or pattern.” 18 U.S.C. § 3663A(a)(2).
4
caused by the particular counts of conviction (as it would be absent the scheme
element). See United States v. Booth, 309 F.3d 566, 575-76 (9th Cir. 2002). In
this context, a restitution order may be based on related but uncharged conduct that
is part of a fraud scheme. See United States v. Grice, 319 F.3d 1174, 1177 (9th
Cir. 2003) (affirming restitution of loss from uncharged conduct beginning prior to
the effective date of the MVRA). The harm to the victim must, however, be
closely related to the scheme, rather than tangentially linked. United States v.
Riley, 143 F.3d 1289, 1292 (9th Cir. 1998) (quoting United States v. Kones,
77 F.3d 66, 70 (3rd Cir. 1996)); see also Gamma Tech Indus., 265 F.3d at 928
(“the loss cannot be too far removed from” the “conduct underlying the offense of
conviction”).
Canada’s claim for restitution is based on events that are insufficiently
related to the schemes set forth in the indictment and the facts supporting Stoliar’s
guilty plea. Canada entered into contracts with City Farm, a Canadian company,
pursuant to which Canada’s Department of Natural Resources would make
contribution and incentive payments to support City Farm’s supposed production
of biodiesel in Canada. After being purchased by Stoliar and his co-defendant,
City Farm falsely represented to Canada that it was producing more biodiesel than
5
it was. Canada now seeks restitution of 1,233,065.32 CAD in fraudulently-
obtained subsidies.
The fraud against Canada had certain aspects in common with the scheme to
which Stoliar pled guilty. Primarily, both appear to have been built upon the same
central falsity: defendants’ misrepresentations regarding the quantity of biofuel that
was produced by City Farm.
The schemes, however, were different. The indictment charged, and the
facts supporting the guilty plea described, a scheme revolving around the false
generation and use of United States biodiesel credits known as renewable
identification numbers (“RINs”).4 It appears that the RIN fraud in the United
States and the biofuel subsidy fraud in Canada proceeded on parallel tracks. But
they were not causally linked. The record does not reflect that either country
considered the other’s renewable energy program in calculating its own incentives.
The schemes were accomplished by different means, had different victims, and
took place primarily in different countries. They were linked too tangentially to be
4
RINs are credits that United States importers and producers can generate
when they import or generate pure biodiesel. RINs are commodities that can be
bought and sold with the biodiesel, or separated from the biodiesel and bought and
sold on a secondary market.
6
part of the same “scheme, conspiracy, or pattern of criminal activity.” 18 U.S.C.
§ 3663A(a)(2).
The questions of whether Canada decided not to prosecute Stoliar in reliance
on the prospect of restitution in this action, or whether Canada’s ability to
prosecute Stoliar was impaired by this action, were not raised by either party, and
therefore are not before us.
We asked the parties to address whether petitioner, a foreign sovereign, is a
“person” who may be a “crime victim” under 18 U.S.C. § 3771(e).5 This appears
to be an open question in this circuit, but we need not reach it here in light of the
disposition above.
The petition for a writ of mandamus is denied.
DENIED.
5
This subsection defines “crime victim” for the purposes of the CVRA as “a
person directly and proximately harmed as a result of the commission of a Federal
offense. . . .” 18 U.S.C. § 3771(e).
7
Counsel Listing
Todd M. Leventhal, Leventhal & Associates, Las Vegas, Nevada, for Petitioner.
David Z. Chesnoff and Richard A. Schonfeld, Chesnoff & Schonfeld, Las Vegas,
Nevada, for Real Party in Interest Nathan “Nati” Stoliar.
Daniel G. Bogden, United States Attorney, Elizabeth Olson White, Appellate Chief
and Assistant United States Attorney, United States Attorney’s Office, Reno,
Nevada; John C. Cruden, Assistant Attorney General, and Wayne D. Hettenbach,
Senior Trial Attorney, Environment and Natural Resources Division, United States
Department of Justice, Washington, D.C., for Real Party in Interest United States
of America.
8