Opinion ID: 182111
Heading Depth: 2
Heading Rank: 1

Heading: South Africa's property interest in the illegally harvested rock lobsters

Text: The MVRA provides for mandatory restitution in all sentencing proceedings for convictions of any offense that is, inter alia, an offense against property under [Title 18] . . . in which an identifiable victim or victims has suffered a . . . pecuniary loss. 18 U.S.C. § 3663A(c)(1)(A)(ii)-(c)(1)(B). Accordingly, the threshold question is whether South Africa has a property interest in the illegally harvested rock lobsters. We conclude that South Africa has a property right in illegally harvested rock lobsters. Under South African law the rock lobsters may be harvested lawfully pursuant to a regulatory scheme administered by the Department of Marine and Coastal Management. Furthermore, under South African law, lobsters caught illegally are not the property of those who caught them, MLRA § 44(2), and the South African government is authorized to seize illegally harvested lobsters, sell them, and retain the proceeds, §§ 51(3)(c)(iii), 63(1)(b), 68(1). Put differently, lobsters possessed in violation of the regulatory scheme do not become property of the possessors, rather they are subject to seizure and sale by the government of South Africa. Under this logic, the moment a fisherman pulls an illegally harvested lobster out of the sea, a property right to seize that lobster is vested in the government of South Africa. Evading seizure of overharvested lobsters thus deprives South Africa of an opportunity to sell those illegally captured lobsters at market price and retain the proceeds, representing an economic loss to South Africa each time an illegally harvested lobster goes unseized. South Africa's interest in those illegally harvested lobsters, therefore, goes beyond a mere regulatory interest in administering the fishing activities in its waters. Contrary to the District Court's conclusion, the Supreme Court's holding in Pasquantino and not Cleveland provides the closest analogy to South Africa's interest in the lobsters seized by the defendants and guides our analysis here. In Cleveland, the Supreme Court concluded that, because its interest was purely regulatory, the State of Louisiana did not have a property right in an unissued license to a video poker operator, despite the pre-issuance processing fees collected by the state. 531 U.S. at 20-21, 121 S.Ct. 365. As Justice Ginsburg explained, The State receives the lion's share of its expected revenue not while the licenses remain in its own hands, but only after they have been issued to licensees. Licenses pre-issuance do not generate an ongoing stream of revenue. Id. Importantly, the Supreme Court noted that as to the character of Louisiana's stake in its video poker licenses, the licensee in Cleveland did not defraud the state of any money to which the State was entitled by law. Id. at 22, 121 S.Ct. 365. By contrast, in Pasquantino, the Supreme Court held that Canada did possess a property right to uncollected excise taxes on liquor that was illegally imported into the country. The uncollected tax, Justice Thomas reasoned, was a right to collect money which is a valuable entitlement considered to be `property' as that term ordinarily is employed. Pasquantino, 544 U.S. at 355-56, 125 S.Ct. 1766 ( citing Black's Law Dictionary 1382 (4th ed. 1951) (defining property as extend[ing] to every species of valuable right and interest) (citations omitted); see also Pasquantino, 544 U.S. at 356, 125 S.Ct. 1766 (The right to be paid money has long been thought to be a species of property.) (citing 3 W. Blackstone, Commentaries on the Laws of England 153-155 (1768)). The Court had no doubt that the right to collect that revenue was `something of value' to the Government of Canada. Id. at 355, 125 S.Ct. 1766 (quoting McNally v. United States, 483 U.S. 350, 358, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987)). As a result, the Pasquantino Court clearly distinguished its earlier holding in Cleveland. In Cleveland, the State's interest in an unissued video poker license was not `property,' because the interest in choosing particular licensees was `purely regulatory' and `[could not] be economic,' id. at 357, 125 S.Ct. 1766 (quoting Cleveland, 531 U.S. at 22-23, 121 S.Ct. 365). Indeed, the Government nowhere allege[d] that [the defendant] defrauded the State of any money to which the State was entitled by law. Id. In Pasquantino, on the other hand, Canada's entitlement to tax revenue is a straightforward `economic' interest . . . the Government alleged and proved that petitioners' scheme aimed at depriving Canada of money to which it was entitled by law. Id. Like the defendants in Pasquantino, Arnold Bengis, Jeffrey Noll, and David Bengis' conspiracy to conceal their illegal trade in lobster deprived South Africa of money it was due. Had the defendants not undertaken efforts to conceal their overharvesting, including off-loading overharvested lobsters at night and under-reporting the amounts of their catch to South African authorities, those lobsters caught in excess of the legal limits would have been seized and sold by the government. As a consequence, the defendants' conduct deprived South Africa of proceeds from the sale of the illegally harvested lobsters, i.e., money to which it was entitled by law. Id. Just as in Pasquantino, had [defendants] complied with [their] legal obligation, they would have paid money to [South Africa]. Like Canada's entitlement to its uncollected excise tax revenue in Pasquantino, South Africa's entitlement to the revenue from the lobsters that were taken illegally does constitute property. The defendants' conduct in depriving South Africa of that revenue is, therefore, an offense against property. [3]