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FILED

MAY 27 2015

SUSAN M. SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT

ORDERED PUBLISHED

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re: ) BAP No. NV-14-1482-JuKuPa

)

DEBORAH LYNN PARTIDA, ) Bk. No. 2:13-bk-11710-LED

)

Debtor. )

______________________________)

)

DEBORAH LYNN PARTIDA, )

)

Appellant, )

)

v. ) O P I N I O N

)

UNITED STATES, DEPARTMENT OF )

JUSTICE, )

)

Appellee. )

______________________________)

Argued and Submitted on May 14, 2015

at Sacramento, California

Filed - May 27, 2015

Appeal from the United States Bankruptcy Court

for the District of Nevada

Honorable Laurel Elizabeth Davis, Bankruptcy Judge, Presiding

________________________

Appearances: Christopher P. Burke argued for appellant Deborah

L. Partida; Roger W. Wenthe argued for appellee

United States.

________________________

Before: JURY, KURTZ, and PAPPAS, Bankruptcy Judges.
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JURY, Bankruptcy Judge:

This appeal arises from the bankruptcy court’s order

denying the chapter 131 debtor’s motion for contempt for

violation of the automatic stay. We conclude as a matter of law

that the enforcement provision of the Mandatory Victims

Restitution Act overrides the operation of the automatic stay

under § 362(a) and in so doing, authorizes the enforcement of

criminal restitution obligations against debtor and property of

the bankruptcy estate. We AFFIRM.

I. FACTS

No facts are in dispute. Before filing bankruptcy, Deborah

L. Partida (Debtor) was convicted of embezzlement and theft of

labor union assets. A criminal judgment was entered, sentencing

Debtor to serve eighteen (18) months in federal prison and to

pay criminal restitution penalties in the amount of $193,337.33. 

As of March 5, 2013, when Debtor filed this chapter 13 case,

Debtor satisfied her term of incarceration but had not paid her

restitution obligation. Debtor listed the restitution

obligation in her schedules and the United States Department of

Justice (the Government) received notice of the bankruptcy

filing. Debtor’s chapter 13 plan was confirmed on March 6,

2014.

After Debtor received a notice of intent to offset and an

1 Unless otherwise indicated, all chapter and section

references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532,

and “Rule” references are to the Federal Rules of Bankruptcy

Procedure.

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“Overdue Debtor Statement,” the Government garnished $272.47

from Debtor’s pension and $467.85 from her retirement benefits

on March 1, 2014. Debtor then filed a motion for contempt for

violation of the automatic stay against the Government in

bankruptcy court. On July 29, 2014, the bankruptcy court heard

oral arguments on the matter. On September 8, 2014, in an oral

ruling, the bankruptcy court denied the motion for contempt on

the ground that the Government’s actions were excepted from the

automatic stay under § 362(b)(1). The order denying Debtor’s

motion was entered on September 22, 2014, and Debtor filed a

timely notice of appeal.

II. JURISDICTION

The bankruptcy court had jurisdiction over this proceeding

under 28 U.S.C. § 157(b)(2)(G). We have jurisdiction under 28

U.S.C. § 158.

III. ISSUE

1. Whether the enforcement provision of the Mandatory Victims

Restitution Act overrides the operation of § 362(a) as to

the enforcement of criminal restitution orders; and

2. Whether the post-conviction enforcement of criminal

restitution orders is excepted from the automatic stay

under § 362(b)(1).

IV. STANDARD OF REVIEW

Questions of statutory interpretation are reviewed de novo. 

United States v. Youssef, 547 F.3d 1090, 1093 (9th Cir. 2008).

We may affirm on any ground supported by the record. 

Siriani v. Nw. Nat’l Ins. Co. (In re Siriani), 967 F.2d 302, 304

(9th Cir. 1992).

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V. DISCUSSION

A. Notwithstanding the automatic stay under § 362(a), the

Mandatory Victims Restitution Act authorizes the

enforcement of criminal restitution orders against

Debtor and property of the bankruptcy estate.

Although the bankruptcy court based its decision on the

exception to the automatic stay provided by § 362(b)(1), the

significant threshold issue is whether the operation of the

automatic stay under § 362(a) is superseded by the subsequent

enactment of the Mandatory Victims Restitution Act (the MVRA) as

to the enforcement of restitution orders against Debtor and

property of the bankruptcy estate.

Section 362(a) details the various stays triggered upon a

bankruptcy filing. Subsection (2) provides that entities are

stayed from the enforcement of a prepetition judgment “against

the debtor or against property of the estate,” while subsection

(3) stays “any act to obtain possession of property of the

estate or of property from the estate or to exercise control

over property of the estate.” These two subsections of § 362(a)

were enacted as part of the Bankruptcy Act of 1978.

In direct conflict, the 1996 enactment of the MVRA provides

in relevant part that “[n]otwithstanding any other Federal law

(including section 207 of the Social Security Act)” the United

States may enforce a judgment imposing criminal fines “against

all property or rights to property of the person fined.” 18

U.S.C. § 3613(a), made applicable to criminal restitution awards

by 18 U.S.C. §§ 3664(m)(1)(A) and 3613(f). Debtor argued to the

bankruptcy court and reiterates here that the automatic stay

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provided in § 362(a) trumps the MVRA. We disagree.

To answer whether Congress intended the MVRA to override

the effect of § 362(a), our analysis must start with the plain

language of the statute. Children’s Hosp. & Health Ctr. v.

Belshe, 188 F.3d 1090, 1096 (9th Cir. 1999). The Ninth Circuit

held that inclusion of the “all property or rights to property”

phrase in the enforcement provision of the MVRA clearly

articulates Congress’ intent to make all of a defendant’s assets

available to restitution orders. United States v. Novak, 476

F.3d 1041, 1046 (9th Cir. 2007) (en banc).

In Novak, the broad reach of the MVRA conflicted with the

preceding anti-alienation provision of ERISA. Id. In order to

square the two statutes, the Ninth Circuit found the MVRA

statutory language provided “guidance on how to resolve [the

statutory conflict], by specifying that all property is covered

‘[n]otwithstanding any other Federal law.’” Id. (citing 18

U.S.C. § 3613(a)). The use of a “notwithstanding” clause

connotes an intention to supersede preceding conflicting

statutory provisions. Id. (citing Cisneros v. Alpine Ridge

Grp., 508 U.S. 10, 18 (1993). However, the full reach of the

“notwithstanding” language is determined “by taking into account

the whole of the statutory context in which it appears.” Id.;

Consejo de Desarrollo Economico de Mexicali, A.C. v. United

States, 482 F.3d 1157, 1168 (9th Cir. 2007).

In finding that the structure of the MVRA expressed a

general intention to override federal anti-alienation

provisions, the Ninth Circuit noted that the MVRA enforcement

provision’s specific inclusion of § 207 of the Social Security

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Act served to give full effect to the “notwithstanding clause.” 

Novak, 476 F.3d at 1047. Section 207 of the Social Security Act

protects Social Security benefits from debt collection actions

and “the operation of any bankruptcy or insolvency law”; no

other provision may be construed to “limit, supersede, or

otherwise modify the provisions of this section except to the

extent that it does so by express reference to this section.” 

42 U.S.C. § 407. Cognizant of this, Congress clearly intended

the reach of the “notwithstanding” clause of the MVRA

enforcement provision to include any conflicting statutory

provisions, even making express reference where explicitly

required. Novak, 476 F.3d at 1047. It follows that there was

no need to specify other statutes because the sweeping breadth

of “all property or rights to property of the person fined”

taken together with the wide reach of “[n]otwithstanding any

other Federal law” was an unambiguous statement that the MVRA

enforcement provision overrides all conflicting federal

statutes. Id. at 1047-48.

By allowing restitution obligations to be enforced against

Social Security benefits, Congress prioritizes the enforcement

of restitution orders by making available moneys traditionally

protected from creditors in bankruptcy. The rationale then

follows that the MVRA authorizes the Government to reach

Debtor’s sources of income regardless of her bankruptcy and the

automatic stay.

Debtor makes two arguments in support of § 362(a) trumping

the MVRA: first, in not adding the MVRA as an exception under

§ 362(b) as part of the 2005 BAPCPA amendments, Congress

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implicitly expressed an intent that the MVRA would not override

the operation of the automatic stay; and second, the 2005 BAPCPA

amendments to certain subsections of § 362 reenacted all of

§ 362(a) such that § 362(a) should be characterized as being

enacted after the MVRA. These arguments are not compelling. 

First, the broad sweeping language of the MVRA enforcement

provision already accomplished an effective override of

§ 362(a). As such the addition of the MVRA as an exception to

the stay under § 362(b) would be superfluous. Second, the

concept that an amendment to one part of a broad, multi-faceted

statute would make the entire statute deemed enacted on the

amendment date is supported by neither case law nor statutory

interpretation. The relevant parts of § 362(a), subsections (2)

and (3), were not amended. The MVRA was clearly adopted after

them and its enforcement provision was intended to override “any

other Federal law.” 18 U.S.C. § 3613(a).

Accordingly, by garnishing Debtor’s retirement and pension

the Government did not violate the automatic stay. Moreover,

because the MVRA enforcement provision precludes the application

of § 362(a) in this case, we need not decide whether § 362(b)(1)

provides an exception to the stay in this case.

VI. CONCLUSION

For this reason, we AFFIRM the bankruptcy court’s denial of

the motion for contempt.

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