Opinion ID: 205321
Heading Depth: 2
Heading Rank: 2

Heading: Pescatore's Motion To Compel Restoration or To Vacate and Modify the Restitution Requirement

Text: In April 2009, AUSA Nandan notified Pescatore that the DOJ had denied the restoration request. Pescatore was subsequently informed that Nandan could not disclose the reason for the denial because the Department considered the details of its response to the USAO to be privileged. In late October and early November 2009, Pescatore, represented by new counsel citing Santobello v. New York, 404 U.S. 257, 92 S.Ct. 495, 30 L.Ed.2d 427 (1971), moved in the district court for an order compelling restoration as specific performance of ¶ 17 of the Plea Agreement, and, alternatively, sought a writ of coram nobis declaring ¶ 1.e. of the Agreement unenforceable as a matter of public policy to the extent that $3 million exceeds the total losses of Pescatore's chop shop victims (restoration/restitution motion). In support of restoration, Pescatore pointed out that the Plea Agreement stated that the DOJ would make its decision in accordance with applicable law, and he argued that it should be compelled to apply a portion of his forfeited assets to satisfy his restitution obligation because no law forbade it to do so. The government responded that there had been no breach of the Plea Agreement by the government. The AUSA stated that the USAO had fulfilled its promise to recommend restoration ( see Motion Hearing Transcript, January 29, 2010 (Motion Tr.), at 18 (We made a recommendation to the Department of Justice; we made the recommendation, we made the request)); that [t]he request was denied because the defendant actually does have assets ( id. ); and that DOJ's decision to deny restoration is not reviewable in a court of law ( id. ). In support of his request for modification of the restitution order, Pescatore pointed out that the purpose of restitution is not punishment, but compensation of victims, and that the losses listed in the PSR Loss Chart attached to the Judgment totaled less than $3 million. He also argued that in reality the total amount of victims' losses was even less than the total indicated by the Loss Chart. He asked that the Plea Agreement be voided and that the restitution amount be recalculated to reflect the actual losses suffered by his victims. The government, in opposition to Pescatore's request for a reduction of his restitution obligation, stated, inter alia, that [t]he Court's order of mandatory restitution in the amount of $3 million is consistent with the Mandatory Victim[s] Restitution Act . . . and is the minimum amount agreed to in the plea agreement.. . . The plea agreement states that restitution shall be in an amount to be determined by the Court, but no less than $3 million. . . . . The Court properly considered the loss sustained by each victim as a result of the defendant's offenses, and properly incorporated the analysis set forth by the Pre-sentence Report. The defendant pled guilty, and was sentenced pursuant to an agreement with the government wherein restitution of at least $3 million was agreed upon. The defendant was represented by counsel at sentencing who provided argument relative to restitution. The Court properly considered all relevant matters and ordered restitution in the lowest agreed upon amount. (Letter from Special AUSA Karen R. Hennigan to Judge Piatt dated December 30, 2009 (Government's December 2009 Letter), at 2-3 (emphasis in original).) At the January 29, 2010 hearing on Pescatore's motion, the colloquy with respect to restitution included the following: MR. FROCCARO [Pescatore's new attorney]: . . . . Your Honor, and this is in no way, shape, or form a reflection on your Honor, but in the parties' plea agreement there was an agreement that he would pay no less than $3 million in restitution. When he was sentenced, there was no probation list attached identifying the victims and the amounts of the losses. . . . . . . . . You went in accordance with the agreement, judge, with the understanding that there would be in actuality at least $3 million in losses. THE COURT: What? MR. FROCCARO: That there would be at least $3 million in actual losses to the victims. THE COURT: Was that raised at the sentencing time? MR. FROCCARO: You know, Judge, the lawyers didn't raise it. And I cited in my papers to your Honor that it is plain error that the lawyers THE COURT: Whoa! Did anybody say to the court at the date of sentence that the $3 million figure which was mentioned, I guess I ordered it [] be paid by December 31, that that was in error? MR. FROCCARO: They didn't. And that was their mistake, Judge. And that constitutes plain error under Second Circuit case law. (Motion Tr. 4-5.) Froccaro argued that the victims' losses totaled at least $1.2 million less than what your Honor ordered ( id. at 5); and although saying that he was unable to state a definite figure ( id. at 6), he said, Judge, this loss is on the PSR for 1.8 ( id. at 18); Judge, I took a calculator out, I added up the loss amount in the PSR, and it added up to 1.8 ( id. at 22; but see id. at 21 (I never agreed to the $1.8 million, your Honor.)). Froccaro acknowledged that Pescatore had not appealed to challenge the $3 million amount. ( See id. at 6.) The government, represented at the hearing by AUSAs Hennigan and Gatz, appeared to take divergent positions on whether the $3 million amount was proper. Hennigan pointed out that there is a plea agreement wherein the defendant got the benefit of a bargain, got the benefit of an agreement that required him to pay $3 million as of the 31st of December 2009, which was passed ( id. at 9); but she also stated that, from the numbers in the presentence report that was incorporated into the sentence ( id. at 10), she calculated the victims' losses to be about $2.7 million ( id. at 11); and she said that [i]n the event that there is ever some overpayment, the government would certainly consider that ( id. at 9). AUSA Gatz took the position that Pescatore should be bound by the Judgment, based on his express agreement to pay restitution of not less than $3 million: Your Honor, I just want to remind the court that the defendant agreed to pay $3 million, in the plea agreement. He said before the court I will pay $3 million and no less in restitution. And your Honor ordered that. And we are done with the J & C. It was filed probably almost a year ago. So this satellite litigation is improper, frankly, as a whole because the defendant agreed to the $3 million in the plea agreement. (Motion Tr. 14.) The court ultimately rejected all of Pescatore's arguments. Having requested in vain that Pescatore provide specifics ( id. at 8) and proof ( id. at 12) as to the contention that his victims' losses totaled no more than $1.8 million, the court found that that contention was not substantiated, not on the representations you made here today, which [are] solely an effort to get more time ( id. at 22). Further noting that, of the amount he did not dispute, Pescatore ha[d]n't even produced a dollar in good faith ( id. at 28), the court stated that Pescatore should at least pay the undisputed amount immediately ( see id. at 27 (Pay what you say you owe.); id. at 22 (Pay them the 1.8.).) And although noting that compliance with the Judgment was already nearly 30 days overdue, the court gave Pescatore a new 30-day period within which to pay the $3 million ordered in the Judgment; the court denied Pescatore's request for a longer period and stated that after 30 days the government should begin to levy on Pescatore's property ( See id. at 20-24.) MS. HENNIGAN: Your Honor, are you ordering that the defendant pay the $3 million within the next 30 days?. . . . THE COURT: 3 million bucks. . . . . . . . . Wasn't my order for $3 million? MS. HENNIGAN: Yes. MS. GATZ: Yes. THE COURT: That is the judgment. MS. HENNIGAN: Yes. MS. GATZ: Yes. THE COURT: Enforce it. (Motion Tr. 21-22.) MS. GATZ: Your Honor, at this point you are not setting aside the J & C, which requires the defendant to pay the $3 million. You are not setting aside the J & C, the judgment and conviction, which requires the defendant to pay the $3 million. You are not setting that aside at this point. THE COURT: No. ( Id. at 24-25.) MS. HENNIGAN: . . . [Y]our Honor, for clarification. Your Honor is suggesting that [Pescatore] pay what he does not dispute, but you are holding him accountable for the $3 million. THE COURT: Yes, I am. ( Id. at 27.) This appeal followed. The new 30-day period granted by the district court ended on March 1, 2010. On March 3, Pescatore moved in this Court for a stay of his restitution obligation. That motion was denied on March 5.