Opinion ID: 2975005
Heading Depth: 1
Heading Rank: 7

Heading: orders of forfeiture and restitution

Text: “We review the district court’s interpretation of the federal forfeiture laws de novo. But the district court’s findings of fact are reviewed under a clearly erroneous standard and the question of whether those facts are sufficient to constitute a proper criminal forfeiture is reviewed de novo.” United States v. O’Dell, 247 F.3d 655, 679 (6th Cir. 2001) (citations omitted). “‘We review de novo whether a restitution order is permitted under the law. If it is, then the amount of restitution ordered - 18 - Nos. 05-5622, 05-5625, 05-5825, 05-5826 United States v. Madison is reviewed under the “abuse of discretion” standard.’” United States v. Johnson, 440 F.3d 832, 849 (6th Cir. 2006) (quoting United States v. Wood, 364 F.3d 704, 714 (6th Cir. 2004)). Mrs. Madison was ordered to forfeit $578,000, the sum of the $437,000 and $141,000 she converted from Cherokee. The judgment appears also to order, and the government to argue for, $147,000 and $437,000, the value of the checks that were proceeds of her unlawful transactions; and the parcels at 2771 Colony Park Drive and 2768 Colony Park Drive, also proceeds of the transactions. Mrs. Madison argues that the order to forfeit $578,000 “in addition to her real property is grossly disproportional to the gravity of the alleged offense.” The forfeiture of the $578,000 Mrs. Madison converted is required by the terms of the forfeiture statute; a sentencing court “shall order” a person convicted of engaging in monetary transactions involving property derived from unlawful activity in violation of 18 U.S.C. § 1957 to “forfeit to the United States any property, real or personal, involved in such offense, or any property traceable to such property.” 18 U.S.C. § 982(a)(1). Mrs. Madison’s Brief at 57. At oral argument, the government conceded that “we can go no farther than $578,000.” Therefore, the forfeiture of property in excess of that amount is no longer an issue. Mrs. Madison’s claim that the forfeiture amount was excessive under the Eighth Amendment is not meritorious. “The touchstone of the constitutional inquiry under the Excessive Fines Clause is the principle of proportionality: The amount of the forfeiture must bear some relationship to the gravity of the offense that it is designed to punish.” United States v. Bajakajian, 524 U.S. 321, 334 (1998). Mrs. Madison possessed the $578,000 only because she misappropriated it from Cherokee, and the amount therefore bears a direct relationship to the offense it is designed to punish. Finally, - 19 - Nos. 05-5622, 05-5625, 05-5825, 05-5826 United States v. Madison Mrs. Madison was not entitled to have the forfeiture amount found by a jury, because she expressly waived a jury determination. Fed. R. Crim. P. 32.2(b)(4); see also United States v. Hall, 411 F.3d 651, 654-55 (6th Cir. 2005) (finding no constitutional right to a jury determination of forfeiture). Mrs. Madison was ordered to pay $751,832.04 in restitution. For $564,832.04 of that amount, which was based on tax losses to the IRS, she was jointly and severally liable with Mr. Madison. The remaining $187,000 was incurred by the receivership for Cherokee because the Cherry Center property, which Mrs. Madison deeded to Cherokee to cover the funds she converted under the guise of retroactive rent, sold for considerably less than the amount of the converted funds. Mrs. Madison argues on appeal that the restitution amount was excessive and not supported by the evidence. A “district court must consider ‘the amount of the loss sustained by any victim as a result of the offense, the financial resources of the defendant, the financial needs and earning ability of the defendant and the defendant’s dependents, and such other factors as the court deems appropriate’ when ordering restitution.” United States v. Adams, 214 F.3d 724, 730 (6th Cir. 2000) (quoting United States v. Dunigan, 163 F.3d 979, 981 (6th Cir. 1999)). The district court heard evidence at sentencing as to the amount of tax loss and loss to the receivership from the sale of the Cherry Center property.7 It adopted the findings in the pre-sentence investigation report (the “PSIR”), which detailed the financial resources of the defendants, their earning ability, and their expenses. The district court thus considered all of the required factors. 7 Both defendants incorrectly assert that the government failed to prove the amount of loss. They cite only the fact that the audit performed by TDHS found no losses as a result of their offenses. Because the TDHS audit examined losses to TDHS, and the receiver’s testimony regarded losses to Cherokee itself, the results of the TDHS audit are irrelevant. - 20 - Nos. 05-5622, 05-5625, 05-5825, 05-5826 United States v. Madison Moreover, contrary to the defendants’ assertions, they have the ability to pay the restitition award. The PSIR here concluded that the defendants were able to pay restitution because they had a net worth of $978,781, or $421,630, after subtracting the properties included in the forfeiture order; and a net monthly income of $7,311. The PSIR also addressed the assets and income of both defendants. Based on these findings, which the district court adopted, the restitution amount is consistent with the defendants’ financial resources.