2003 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

4-24-2003

USA v. Terlingo

Precedential or Non-Precedential: Precedential

Docket 02-1640

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Recommended Citation

"USA v. Terlingo" (2003). 2003 Decisions. Paper 577.

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PRECEDENTIAL

Filed April 23, 2003

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nos. 02-1640, 02-1641 and 02-1642

UNITED STATES OF AMERICA

v.

DOMENICK TERLINGO, TARA TERLINGO, and

DOMENICK L. TERLINGO

Domenick Terlingo, Appellant in No. 02-1640

Tara Terlingo, Appellant in No. 02-1641

Domenick L. Terlingo, Appellant in

No. 02-1642

On Appeal From the United States District Court

For the Eastern District of Pennsylvania

(D.C. Crim. Nos. 99-525-06/07/08)

District Judge: Honorable Jan E. DuBois

Submitted Under Third Circuit LAR 34.1(a)

January 21, 2003

Before: BECKER, Chief Judge, NYGAARD and

AMBRO, Circuit Judges.

(Filed: April 23, 2003)

F. EMMETT FITZPATRICK, ESQUIRE

NIALENA CARVASOS, ESQUIRE

F. Emmett Fitzpatrick, P.C.

926 Public Ledger Building

610 Chestnut Street

Philadelphia, PA 19106

Attorneys for Appellants
PATRICK L. MEEHAN

United States Attorney

LAURIE MAGID

Deputy United States Attorney

for Policy and Appeals

ROBERT A. ZAUZMER

Assistant United States Attorney

Senior Appellate Counsel

THOMAS M. ZALESKI

Assistant United States Attorney

Office of the United States Attorney

for the Eastern District of

Pennsylvania

615 Chestnut Street

Philadelphia, PA 19106

Attorneys for Appellee

OPINION OF THE COURT

BECKER, Chief Judge:

This is a sentencing appeal brought by defendants

Domenick Terlingo, Tara Terlingo, and Domenick L.

Terlingo, who were convicted by a jury of conspiracy to

transport stolen vehicles in interstate commerce. The

Terlingos assert that the order of restitution imposed by the

District Court is invalid because it was imposed more than

ninety days after sentencing, in contravention of the

following provision of 18 U.S.C. § 3664(d)(5):

If the victim’s losses are not ascertainable by the date

that is 10 days prior to sentencing, the attorney for the

Government or the probation officer shall so inform the

court, and the court shall set a date for the final

determination of the victim’s losses, not to exceed 90

days after sentencing. (Emphasis added). 

The Government submits that the District Court was

correct to rule that because the delay was the fault of the

defendants it would equitably toll the time-bar and allow

the hearing to take place outside the ninety-day limit. This

appeal raises a question of first impression for this Court:

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is the 18 U.S.C. § 3664(d)(5) time limit subject to equitable

tolling, and if so, under what circumstances? Because we

conclude that this time limit is subject to equitable tolling

when the delay is caused in significant part by the

defendant, we will affirm the judgment of the District Court.

I.

Between March 1995 and May 1997, the Terlingos

participated in a scheme to steal and sell luxury

automobiles after changing their vehicle identification

numbers. In December 2000, a jury convicted the Terlingos

of one count of conspiracy to transport stolen vehicles in

interstate commerce in violation of 18 U.S.C. § 371. On

October 9, 2001, the District Court sentenced Domenick

Terlingo to eighteen months imprisonment and three years

supervised release, and on October 11, 2001 it sentenced

both Tara and Domenick L. Terlingo to three years

probation and six months house arrest. 

At the request of the Government, because it needed

more time to obtain necessary documents, the District

Court did not address the issue of restitution at the

defendants’ sentencing hearings but rather delayed entry of

a restitution order pursuant to 18 U.S.C. § 3664(d)(5). On

December 21, 2001, the District Court ordered counsel for

both parties to report jointly to the Court on the status of

the restitution issue on or before January 7, 2002, a date

ninety days after Domenick Terlingo’s sentencing. In a

December 28, 2001 letter to the District Court, the

Government requested that the Court schedule the

restitution hearings for Domenick, Tara, and Domenick L.

on the 7th, 8th, and 9th of January, 2002, respectively. In

response, the District Court scheduled a hearing for all

three Terlingos on January 7, 2002. 

On January 4, 2002, however, the defendants moved for

a continuance of the restitution hearing, representing that

they were unprepared to go forward because the

Government had not timely provided them with the

necessary discovery. In addition, defendants’ counsel

informed the District Court that they would be unable to

attend the January 7th hearing because they were

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scheduled for trial on another matter in the Eastern

District of Pennsylvania. The Government opposed this

request for a continuance, but the District Judge granted

the motion, apparently to accommodate his District Court

colleague’s trial schedule. 

The District Court did not hold the restitution hearing

until February 25, 2002, at the conclusion of which it

ordered Domenick Terlingo to pay $46,534.16, and both

Tara and Domenick L. Terlingo to pay $5,000 in restitution.

Because this hearing took place outside the ninety-day

period specified by § 3664(d)(5), the defendants appealed.

II.

A.

Under the plain language of § 3664(d)(5), the district

court “shall” set a date for the final determination of the

victim’s losses to occur within ninety days of sentencing.

After argument by counsel for the defendants and the

government on the applicability of the ninety-day time bar,

the District Court rejected the defendants’ argument and

made the following findings: 

I think that there is absolutely no bad faith on the part

of the defense. I think the government missed a

deadline, almost missed a deadline. If they had really

missed the deadline, if I hadn’t scheduled a hearing for

January 7th, I might rule differently, but I’m ruling

now, taking Stevens, U.S. v. Stevens and extending it

just one step further, I scheduled a restitution portion

of the sentencing in this case for January 7th, I

continued that restitution hearing at the request of the

defendants. They had a legitimate request, the notice

was short. It was short because the government didn’t

request the hearing and they failed to respond to an

order directing that they submit a status report in 60

days, but in any event, the hearing would have gone

forward on January 7th, within the ninety days, had

the defense counsel not been on trial. 

And, under those circumstances, again, absolutely no

bad faith, I’m taking the Stevens rationale and I’m

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ruling that because the continuance was not the fault

of the Government, it was at the request of the defense,

a legitimate request, I am not going to bar the

Government from presenting restitution arguments and

from seeking a restitution order in this case. 

As we read the record, these findings are supported. The

defendants argue that the entire fault for the delay in the

issuance of a restitution order lay with the government

because the government failed to turn over discovery in a

timely fashion before the date of the scheduled hearing. The

District Court’s findings, which, as noted above, are

supported, undermine that contention. This is not the end

of our inquiry, however; we must still determine whether

the District Court erred in determining that the § 3664(d)(5)

time-bar is subject to equitable tolling, and if it was correct

in so finding, whether it was also correct in concluding that

equitable tolling was appropriate under the facts of this

case. 

We begin with the threshold question whether the time

limit of § 3664 (d)(5) is subject to equitable tolling at all.

Two Courts of Appeals have answered this question in the

affirmative. In United States v. Stevens, 211 F.3d 1 (2d Cir.

2000), relied upon by the District Court, the Court of

Appeals for the Second Circuit concluded that the time

limit must be tolled when the restitution hearing was

delayed due to the bad faith tactics of the defendant.

Similarly, in United States v. Dando, 287 F.3d 1007, 1011

(10th Cir. 2002), the Court of Appeals for the Tenth Circuit

plainly stated that the “statute’s time prescriptions . . . are

subject to equitable tolling” and cited to Stevens and to

Carlisle v. United States, 517 U.S. 416, 435

(1996)(Ginsburg, J., concurring)(observing that “limitations

periods generally” are subject to equitable tolling). 

In addition, in United States v. Maung, 267 F. 3d 1113,

1122 (11th Cir. 2001), the Court of Appeals for the

Eleventh Circuit implied that the limit is tollable because

“[a]llowing the defendant’s own bad faith delay to foreclose

the entry of a restitution order could conceivably put

restitution in some cases in the defendant’s own

discretion.” The Court was therefore unwilling to say “that

the 90-day limitation is inexorable and can never be

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equitably tolled. We have no occasion to decide that issue

in this case, anyway.” Id.

B.

The Supreme Court has not directly addressed the issue

at bar, nor has the Court laid down any hard and fast rules

for determining what kinds of statutes are subject to

equitable tolling. It is possible, however, to glean some

guidance on the issue from a handful of Supreme Court

decisions. In addition to Justice Ginsburg’s statements on

the matter in Carlisle, supra, the Supreme Court spoke in

some depth on the application of equitable tolling in certain

situations in Irwin v. Department of Veterans Affairs, 498

U.S. 89 (1990). In that case, the Court noted that “[t]ime

requirements in lawsuits between private litigants are

customarily subject to ‘equitable tolling.’ Indeed, we have

held that the statutory time limits applicable to lawsuits

against private employers under Title VII are subject to

equitable tolling.” Id. at 95 (internal citations omitted). The

Court concluded that, in the context of a Title VII action

against the government, “the same rebuttable presumption

of equitable tolling applicable to suits against private

defendants should also apply to suits against the United

States.” Id. at 95-96. This language does not subsume the

situation before us, of course, but it surely indicates

general approval of the widespread applicability of equitable

tolling principles. 

The Supreme Court’s discussion of equitable tolling in

United States v. Brockamp, 519 U.S. 347 (1997), also

provides guidance as to what kinds of statutes are subject

to equitable tolling. In Brockamp, the Court determined that

the time limits for filing tax refund claims set forth in

§ 6511 of the Internal Revenue Code were not subject to

equitable tolling. The Court’s reasoning is instructive, so we

rescribe it at length: 

Section 6511 sets forth its time limitations in

unusually emphatic form. Ordinarily limitations

statutes use fairly simple language, which one can

often plausibly read as containing an implied

“equitable tolling” exception. See, e.g., 42 U.S.C.

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§ 2000e-16(c) (requiring suit for employment

discrimination to be filed “[w]ithin 90 days of receipt of

notice of final [EEOC] action . . .”). But § 6511 uses

language that is not simple. It sets forth its limitations

in a highly detailed technical manner, that,

linguistically speaking, cannot easily be read as

containing implicit exceptions. Moreover, § 6511

reiterates its limitations several times in several

different ways. . . . 

In addition, § 6511 sets forth explicit exceptions to its

basic time limits, and those very specific exceptions do

not include “equitable tolling.” See § 6511(d)

(establishing special time limit rules for refunds related

to operating losses, credit carrybacks, foreign taxes,

self-employment taxes, worthless securities, and bad

debts) . . . . 

To read an “equitable tolling” provision into these

provisions, one would have to assume an implied

exception for tolling virtually every time a number

appears. To do so would work a kind of linguistic

havoc. Moreover, such an interpretation would require

tolling, not only procedural limitations, but also

substantive limitations on the amount of recovery — a

kind of tolling for which we have found no direct

precedent. 

Id. at 350-52. 

In contrast to the IRS provision discussed in Brockamp,

the time-limit of § 3664(d)(5) looks very much like that of 42

U.S.C. § 2000e-16(c), which the Court pointed to as an

example of a statute subject to equitable tolling; and

§ 3664(d)(5) does not remotely resemble the complicated tax

time limits the Brockamp Court held were not subject to

equitable tolling. 18 U.S.C. § 3664(d)(5)’s ninety-day

requirement is not set forth “in unusually emphatic form”

or in a “highly detailed technical manner,” but rather

“use[s] fairly simple language.” In addition, there are no

built-in time limit exceptions to § 3664(d)(5). In light of

Justice Ginsburg’s observation that “limitations periods

generally” are subject to equitable tolling, Carlisle, 517 U.S.

at 435 (Ginsburg, J., concurring), and the fact that the

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time-limit at issue here is nearly identical to one that the

Brockamp Court stated could be “plausibly read as

containing an implied ‘equitable tolling’ exception,” we

conclude that the ninety-day time limit of § 3664(d)(5) is

subject to equitable tolling. Brockamp, 519 U.S. at 350.

C.

This conclusion is buttressed by looking to the purpose

of the ninety-day time limit. As the Court of Appeals for the

Second Circuit concluded in Stevens, it appears that the

time limit was not created for the benefit of the convicted

criminal, but to protect the victims of the crimes of which

he has been convicted. Senate Report No. 104-179, which

was adopted as the Conference Report for the Victim

Restitution Act of 1995, stated that “[t]he committee . . .

intends that . . . the defendant’s assets and ability to pay

be subject to strict review by the court. In particular, the

committee is concerned that defendants not be able to

fraudulently transfer assets that might be available for

restitution.” On the basis of this language, the Stevens

Court concluded that “[i]n our view, the 90-day limit on the

entry of a restitution order is more consistent with

Congress’s concerns about preventing the dissipation of a

defendant’s assets, than with protecting a defendant from a

drawn-out sentencing process,” Stevens, 211 F.3d at 4 n.2,

and that “Congress could not have intended to permit

offenders to subvert the VWPA by using dilatory

maneuvering to defeat a sentence of restitution.” Id. at 4.1

On the basis of this theory, it makes sense to grant

equitable tolling, on behalf of the government representing

the victims, if the defendant has, in bad faith, delayed to

the point where the restitution order is untimely. A time

limit that is intended to benefit the victims should not fall

prey to the delaying tactics of a defendant who has every

1. The Maung Court cautioned that “we may only look to legislative

history if [the] plain meaning produces ‘a result that is not just unwise

but is clearly absurd.’ ” Maung, 267 F. 3d at 1121. The Court also

acknowledged, however, that allowing the defendant to cause the delay

of the restitution order past the 90-day limit might produce such an

absurd result. 

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incentive to ensure that the restitution order does not fall

within the 90-day period. We note too that, as the Court

explained in Brice v. Secretary of Health and Human

Services, 240 F.3d 1367, 1373 (Fed. Cir. 2001), “the

doctrine of equitable tolling is designed to prevent harsh

and unjust results . . .”; see also Spencer v. Sutton, 239

F.3d 626, 630 (4th Cir. 2001) (“. . . equitable tolling is

available only in ‘those rare instances where — due to

circumstances external to the party’s own conduct — it

would be unconscionable to enforce the limitation period

against the party and gross injustice would result.’ ”). Such

a harsh result could occur where the defendant’s bad faith

delay causes the victims of his crimes to be denied

restitution. Since it may also make sense to grant equitable

tolling to the government as long as the delay is caused by

the defendant in significant part for any reason, even if

there is no bad faith involved, we turn to the second major

legal issue before us. Having determined that equitable

tolling can apply to 18 U.S.C. § 3664 (d)(5), under what

circumstances should it apply?

D.

In United States v. Maung, 267 F. 3d 1113 (11th Cir.

2001), the defendant was not responsible for the fact that

the restitution hearing did not occur during the ninety-day

period. The government argued that, nonetheless, the 90-

day statutory period should be tolled because it would

cause the defendant no prejudice. The Court rejected this

argument, noting that there is no prejudice requirement in

the statute. In analyzing the tolling question, the Court

relied on the prescription that when the meaning of a

statute is clear on its face, a court may only look to

legislative history “if that plain meaning produces ‘a result

that is not just unwise but is clearly absurd.’ ” Id. at 1121.

The Court then reasoned that a “strict [non-tollable] 90-day

limit might produce an absurd result in cases where the

defendant’s own bad faith causes the entry of the order to

be delayed beyond 90 days.” Id. at 1122. In the facts before

it, however, “[t]he delay . . . was not caused by obstruction

or bad faith tactics of the defendant. By all accounts, the

parties negotiated in good faith, but were unable to reach

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agreement on the amount of restitution. There is no

indication that the defendant was any more at fault for the

delay than the government. In this situation, it is not

plainly absurd to let the chips fall where the plain language

of the statute indicates they should.” Id. 

Under the Maung Court’s interpretation of § 3664(d)(5),

equitable tolling will not apply when the fault for the delay

is shared by the parties. It appears from the quoted

language that the Maung Court would have found that

equitable tolling did not apply even if the delay had been

caused by the defendant, as long as he had not acted in

bad faith. The Court left open the possibility, however, that

equitable tolling would apply when the delay was caused by

the defendant’s bad faith, as in that situation alone a strict

reading of the ninety-day limit “might produce an absurd

result.”2

The Court of Appeals for the Tenth Circuit came to a

different conclusion in United States v. Dando, 287 F. 3d

1007 (10th Cir. 2002). In that case, the District Court had

been prepared to enter the restitution order within the

ninety-day period, but defense counsel twice asked that the

order be delayed, the first time because his client was not

present, and the second time to allow for an evidentiary

hearing concerning the amount of restitution. After stating

that the statute’s time-bar provision is subject to equitable

tolling, the Dando Court concluded that “the Government

moved to file a restitution order well within the ninety-day

time frame established by the statute” and “the delay was

due to Defendant’s request for a continuance and for an

evidentiary hearing. Where a defendant’s own conduct

delayed the timely entry of a restitution order, the

defendant cannot insist on strict conformity with the

statute’s time prescriptions.” Id. at 1011. Under the Dando

formula then, bad faith on the part of the defendant is not

necessary; equitable tolling will apply as long as the delay

was caused by the defendant, rather than by the

government. 

2. The Court went on to state: “For that reason, we are not willing to say

that the 90-day limitation is inexorable and can never be equitably

tolled. We have no occasion to decide that issue in this case, anyway.”

Id. at 1122. 

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The third case to address equitable tolling in this context

is United States v. Stevens, 211 F.3d 1 (2d Cir. 2000). As in

the other cases, the restitution order in Stevens came after

the end of the 90-day period. In that case, however, the

delay was caused by the defendant’s bad faith behavior.

The Court determined that the defendant “himself caused

the extended delay. The restitution order could not be

issued . . . because . . . ‘[the defendant] has been

stonewalling from the beginning and [has continued] to

stonewall’ . . . and has been ‘flouting the authority of the

court’ by concealing significant assets from the prosecutors.

. . .” Id. at 4. The Court concluded that “to vacate the

restitution order where the defendant himself ran out the

90-day clock would be to reward him for willful defiance of

the court’s orders.” Id. at 5. 

Having surveyed the extant caselaw, it is clear that,

because the statute is designed to protect the victims of the

crimes in question, equitable tolling should apply to

situations in which the convicted individual’s bad faith

tactics caused the delay. This result is consistent with

Stevens and Dando, and not inconsistent with Maung. We

also conclude, because equitable tolling is generally

available in situations in which, in its absence, there will be

a harsh or unjust result, that even in the absence of any

bad faith behavior the statute must be equitably tolled

when the delay is caused in significant part by the

defendant. The statute is designed to protect the interests

of the defendant’s victims, and injustice will result if the

dictates of the statute can be avoided by a delay caused by

the actions of the defendant, in bad faith or not. If the

defendant played no significant part in causing the delay,

however, equitable tolling will not be available. 

In the case at bar, it is clear that there was no bad faith

on the part of the defendants. Still, the defendants were, in

significant part, the cause of the delay because their

lawyers could not appear at, and moved to continue, the

originally scheduled restitution hearing. Equitable tolling

was therefore proper, and the District Court did not err

when it tolled the ninety-day time limit. 

The judgment of the District Court will be affirmed. 

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A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

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