United States v. Bramson

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 96-4151
LEONARD A. BRAMSON,
Defendant-Appellant.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
J. Frederick Motz, Chief District Judge.
(CR-92-145-JFM)
Argued: October 28, 1996
Decided: February 24, 1997
Before MURNAGHAN, WILLIAMS, and MICHAEL,
Circuit Judges.
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Affirmed in part and remanded in part by unpublished per curiam
opinion.
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COUNSEL
ARGUED: Daniel E. Ellenbogen, Washington, D.C., for Appellant.
Andrew Clayton White, Assistant United States Attorney, Baltimore,
Maryland, for Appellee. ON BRIEF: Lynne A. Battaglia, United
States Attorney, Carmina S. Hughes, Assistant United States Attor-
ney, Joseph L. Evans, Assistant United States Attorney, Baltimore,
Maryland, for Appellee.
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Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
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OPINION
PER CURIAM:
Defendant-Appellant, Leonard Bramson, pled guilty to money
laundering pursuant to 18 U.S.C. § 1956(a)(1)(A)(I). Bramson was
sentenced to 108 months in prison, 3 years of supervised release, and
was required to make restitution in the amount of $3,600,000. Bram-
son's sentence was modified due to his cooperation with the govern-
ment in another case. At the second sentencing hearing, Bramson's
sentence was reduced by 11 months, and the restitution order was
reimposed. The district court also reimposed its earlier order requiring
the probation officer to establish a restitution payment schedule.
Bramson appeals, arguing that 1) the restitution order is now
unnecessary because there is a valid civil judgment against him; 2)
the district court made inadequate findings regarding Bramson's abil-
ity to pay; and 3) the district court improperly delegated the execution
of the restitution order.
We affirm except as to the Appellant's assertion that the district
court improperly delegated its authority regarding the execution of the
restitution order. The government has conceded that the delegation of
the order was improper, and we agree. Therefore, we remand the case
to the district court for the sole purpose of creating a payment process
consistent with this opinion.
I. BACKGROUND
Bramson was involved in a sophisticated insurance scheme that
purported to provide medical malpractice insurance to physicians.
Bramson created several insurance companies which collected premi-
ums from physicians, transferred those premiums to off-shore
accounts, and then refused to pay insurance claims as required.
2
In 1991, the Circuit Court for Baltimore City placed Bramson's
businesses in receivership in order to collect assets and reimburse the
physicians and other claimants who had been defrauded. The receiver
estimated that the fraud took in approximately $10,000,000. As of
May 1994, the receiver had recovered $6,400,000. In addition, the
receiver believed that there was a high likelihood that the Bramson
family held other assets throughout the world.
After Bramson's sentence, a civil judgment was entered against
Bramson for $35,600,000 for damages resulting from the insurance
fraud. None of that judgment has been recovered from Bramson.
Bramson's plea agreement included a provision which would allow
for the reduction of Bramson's sentence if Bramson cooperated with
the government in another pending case. The United States Attorney's
Office for the District of New Jersey requested such a reduction to
reward Bramson for his cooperation in relation to a case in New Jer-
sey. The government filed a motion for reduction of sentence pursu-
ant to Rule 35 of the Federal Rules of Criminal Procedure. Several
months later, Bramson filed a motion for reduction of sentence which
included a request to vacate the original restitution order.
A hearing was held on the modification order, and the district court
granted the motion and reduced the defendant's sentence to 97
months. The court reimposed the three years of supervised release, the
restitution order, and the requirement that the probation officer estab-
lish a restitution payment schedule.
II. DISCUSSION
Appellant first argues that the district court's restitution order was
improper in the instant case. The decision to order restitution pursuant
to the Victim and Witness Protection Act of 1982 (VWPA), as
amended, 18 U.S.C.A. §§ 3663-3664 (West 1985 & Supp. 1996), is
within the discretion of the district court and the court of appeals will
review for abuse of discretion. United States v. Blake, 81 F.3d 498,
505 (4th Cir. 1996).
Appellant argues that the language of the VWPA prohibits the
institution of restitution in the instant case. Section 3663(e)(1) states,
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"The court shall not impose restitution with respect to a loss for which
the victim has received or is to receive compensation." Appellant
argues that under the plain language of the statute restitution is
improper since there is a civil court judgment against him so the vic-
tims "[are] to receive compensation." 18 U.S.C. § 3663(e)(1). How-
ever, just because the victims have a valid district court judgment
does not mean that they will receive compensation. The "is to
receive" language in 18 U.S.C. § 3663(e)(1) requires actual receipt or
certainty regarding receipt. Mere speculation that a victim will receive
compensation is insufficient to require a modification of a restitution
award.
Appellant next argues that he is entitled to a reduction in restitution
due to the civil judgment because without such a reduction he will be
required to compensate victims twice. Appellant further argues that
the restitution amount should be reduced pro tanto by any amount
that might be recovered pursuant to a civil action. See United States
v. Savoie, 985 F.2d 612, 619 (1st Cir. 1993); United States v.
Gaultier, 727 F.2d 711, 716 (8th Cir. 1984).
However, the authority cited by the Appellant is contrary to his
argument. Both cases stand for the proposition that a restitution award
should be reduced by any amount actually recovered, not potentially
recovered from a civil action. See Savoie, 985 F.2d at 619 ("[T]he set-
off provision is based upon actual payments rather than promises to
pay at some future date(s)."); Gaultier, 727 F.2d at 716 ("[I]f AFFS
receives anything in its civil action . . . Gaultier's obligation to make
restitution is to be reduced pro tanto."); see also United States v. Fer-
min Castillo, 829 F.2d 1194 (1st Cir. 1987) (adopting the Gaultier
standard). Thus, the civil judgment alone provides no basis for reduc-
tion in the restitution award.1
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1 The Appellant should not have to"pay the piper twice." Savoie, 985
F.2d at 619, n.9. However, in the instant case, double counting is not a
major concern. The civil judgment far exceeds the restitution award.
Double counting would only be implicated if Bramson satisfies all but
$3,600,000 of the $35,600,000 million civil judgment. If Bramson suc-
cessfully satisfies his civil judgment, then Bramson can seek modifica-
tion of the order at that time.
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The Appellant further argues that the restitution order does not
specify the victims to be compensated; therefore, he can never com-
pensate the victims as required by the statute. 18 U.S.C.A. § 3663(e).
However, since the receiver is entrusted with compensating the vic-
tims, the victims of Bramson's scheme are compensated when Bram-
son makes payments to the receiver. The district court was within its
discretion when it ordered Appellant to pay the receiver who was
appointed to manage the payment and collection of relevant funds.
Such an order is practical and will lead to additional payments to the
victims.2
In addition, Appellant questions the adequacy of the district court's
factual findings regarding the restitution award. In order to ensure
effective appellate review regarding restitution orders, sentencing
courts must make explicit findings of fact on each of the factors set
forth in 18 U.S.C. § 3664(a). United States v. Blake, 81 F.3d at 505;
United States v. Bruchey, 810 F.2d 456, 458 (4th Cir. 1987). Such
findings must tie the amount and type of restitution to the financial
resources, needs, and earning ability of the defendant. Blake, 81 F.3d
at 505. In addition, the court must make a specific finding that the
defendant feasibly can comply with the order without undue hardship
to himself or his dependents. Id. The court can satisfy this require-
ment by stating its findings or by adopting adequate findings in the
presentencing report. Id. In the instant case, the district court adopted
the presentencing report which was sufficient to satisfy Bruchey.
Appellant's third argument is that the district court improperly del-
egated the authority to set the restitution payment schedule to the
Bureau of Prisons and the probation officer. Such a delegation is
improper under United States v. Johnson, 48 F.3d 806, 809 (4th Cir.
1995) ("making decisions about the amount of restitution, the amount
of installments, and their timing is a judicial function and therefore
is non-delegable"). The district court may delegate duties to the pro-
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2 In addition, restitution is appropriate in the instant case despite the
civil order because it is more likely that money will be recovered as a
result of the restitution order. As a practical matter, restitution is much
more easily collected by probation officials than by private citizens with
a civil judgment, since probation officials are in a far better position to
monitor the Appellant's financial status.
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bation officer, but the district court must retain ultimate authority. The
district court would satisfy this requirement if it required the proba-
tion officer to submit the payment schedule to the court for approval.
We remand solely on this point, so that the district court may imple-
ment a restitution schedule consistent with this opinion.
AFFIRMED IN PART; REMANDED IN PART
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