Opinion ID: 173215
Heading Depth: 3
Heading Rank: 2

Heading: Residual Proceeds

Text: Turning next to the issue of residual proceeds, the district court’s initial distribution schedule gave Mr. Mann last priority to any leftover funds from the foreclosure sale. The government subsequently asked that those funds be applied to Mr. Mann’s unsatisfied criminal restitution order, and the magistrate judge granted the request. In the interim, the IRS mistakenly notified Mr. Mann that he still owed back taxes, all of which prompted him to demand, among other things, that any outstanding tax liabilities be satisfied with the residual proceeds first, before anything was paid towards restitution. The government eventually -5- discovered the error, however, and explained that all of Mr. Mann’s relevant tax liabilities had been satisfied. Accordingly, the district court’s revised distribution order acknowledged that the IRS notice had been sent in error, and thus the order directed the excess proceeds to be applied towards restitution. R.O.A., Vol. 1 at 615-16, 621. Despite these circumstances, Mr. Mann maintains that the revised distribution schedule misappropriates funds to a junior obligation (restitution) while his senior tax liability remains unsatisfied. Purporting to preserve the integrity of a senior debt, Mr. Mann seeks to reinstate the initial distribution schedule, which gave him last priority to any leftover proceeds. It is evident from the record, however, that Mr. Mann’s relevant tax liabilities were satisfied with the proceeds from the foreclosure sale. See id. at 621. There is thus no merit to Mr. Mann’s contention. His suggestion that the district court ought to retain the residual proceeds until Ms. Mann prevails on her wrongful levy action is likewise meritless. And, to the extent he simply seeks reversal of the district court’s application of excess proceeds to his restitution order, he fails to show an abuse of discretion. The judgment of the district court is AFFIRMED. All outstanding motions are denied as moot. Entered for the Court Wade Brorby