Systemax, Inc. v. Fiorentino

• Decision Date: 23 October 2019
• Docket Number: No. 3D17-2722,3D17-2722
• Citation: 283 So.3d 415
• Parties: SYSTEMAX, INC., Appellant, v. Gilbert FIORENTINO, Appellee.
• Court: Florida District Court of Appeals

283 So.3d 415

SYSTEMAX, INC., Appellant,

v.Gilbert FIORENTINO, Appellee.

No. 3D17-2722

District Court of Appeal of Florida, Third District.

Opinion filed October 23, 2019

Bruce S. Rogow and Tara A. Campion (Ft. Lauderdale), for appellant.

AGENTIS, PLLC, Christopher B. Spuches, Coral Gables, Jake M. Greenberg, Miami, and Alexander G. Strassman, Coral Gables, for appellee.

Before FERNANDEZ, SCALES, and LINDSEY¹ , JJ.

PER CURIAM.

I. BACKGROUND

Gilbert Fiorentino ("Fiorentino") served as a corporate director and Chief Executive of Technology Products for Systemax, Inc. ("Systemax"), a publicly traded company. Following allegations of fraud, on April 18, 2011, Systemax filed its Form 8-K,² where it publicly announced the conclusion of an internal audit investigation of Fiorentino. Shortly thereafter, Fiorentino resigned on May 6, 2011. Simultaneously with Fiorentino's resignation, Fiorentino and Systemax entered into a settlement agreement requiring Fiorentino to surrender assets valued at approximately $11 million to Systemax. As part of the settlement, Fiorentino agreed to five-year noncompetition and non-solicitation obligations.

Thereafter, the Federal Government charged Fiorentino with conspiracy to commit securities fraud and to impede and impair the Internal Revenue Service in violation of 18 U.S.C. § 371. Fiorentino entered into a plea agreement. Pursuant to the plea agreement, he was sentenced to 60 months of imprisonment and three years of supervised release. As part of the sentence, Fiorentino was ordered to pay $35,867,883 in restitution³ to Systemax.

On March 29, 2017, Systemax recorded the restitution judgment pursuant to 18 U.S.C. § 3664 (m)(1)(B).⁴ Thereafter, Fiorentino filed a counterclaim seeking declaratory and injunctive relief, along with a Section 55.509⁵ objection to the enforcement of the federal judgment. Fiorentino also recorded a lis pendens as to the foreign judgment. In the counterclaim, Fiorentino contended that enforcement of the restitution order was precluded by: (1) his settlement agreement with Systemax, and (2) 18 U.S.C. § 3664 (m)(1), which, Fiorentino argued, provided the federal government the sole right to enforce an order of restitution. Systemax moved to overrule Fiorentino's objection, dissolve the lis pendens, and lift the stay of enforcement. Thereafter, Systemax served Fiorentino with discovery in aid of execution. The discovery consisted of, among other things, 103 requests for production, seeking Fiorentino's personal financial information. Fiorentino moved for a protective order and requested a stay of discovery.

Following a hearing, the trial court entered the order on appeal. In the order, the trial court concludes that, although a victim is entitled to domesticate a federal restitution judgment, only the United States government may pursue enforcement of the lien created thereby. The trial court, however, rejected Fiorentino's argument that enforcement was precluded by the settlement agreement, finding that criminal restitution is "a separate and distinct remedy from that of the civil case that was previously settled." For this reason, the trial court declined to rule on Fiorentino's request for declaratory judgment and injunctive relief. In sum, the trial court denied Systemax's motions to overrule the objection, entered a stay, and dissolved the lis pendens. Consistent with its rulings, the court granted Fiorentino's motion for a protective order and stayed discovery of Fiorentino's personal financial information. This appeal followed.⁶

The issue on appeal is whether 18 U.S.C. § 3664 (m)(1)(B) authorizes a criminal victim to pursue collection of a federal restitution order in state court.

II. STANDARD OF REVIEW

As a pure question of statutory interpretation, we review this matter de novo. Borden v. East-European Ins. Co., 921 So. 2d 587, 591 (Fla. 2006).

III. ANALYSIS

A. Jurisdiction

Appellant claims that we have jurisdiction based on Florida Rule of Appellate Procedure 9.030(b)(1)(A). However, that rule generally pertains to appeals from final orders. The order at issue is not a final order.

Here, the trial court's order dissolved a lis pendens. In Rodriguez v. Guerra, 254 So. 3d 521 (Fla. 3d DCA 2018), we addressed this court's jurisdiction to review an order dissolving a lis pendens:

[w]hile appellant challenged the subject non-final order via appeal, we recognize that recent decisions of this Court indicate that the appropriate procedure for reviewing non-final orders granting or discharging a lis pendens, and non-final orders relating to lis pendens bonds, is via a certiorari petition. See Bankers Lending Servs., Inc. v. Regents Park Invs., LLC, 225 So. 3d 884, 885 (Fla. 3d DCA 2017) ; 100 Lincoln Rd. SB, LLC v. Daxan 26 (FL), LLC, 180 So. 3d 134, 136 (Fla. 3d DCA 2015). These recent decisions, though, did not abrogate prior decisions of this Court concluding that we have appellate jurisdiction to review such non-final orders under Florida Rule of Appellate Procedure 9.130(a)(3)(B). See Acapulco Constr., Inc. v. Redavo Estates, Inc., 645 So. 2d 182, 183 (Fla. 3d DCA 1994) ; Roger Homes Corp. v. Persant Constr. Co., 637 So. 2d 5, 6 n. 1 (Fla. 3d DCA 1994) ; Munilla v. Espinosa, 533 So. 2d 895, 895 n. 1 (Fla. 3d DCA 1988). The result in this case is not dependent upon the review mechanism, and would have been the same had appellant filed a petition for certiorari relief rather than an appeal.

254 So. 3d at 521 n. 1. Because the result in this case is likewise not dependent on the review mechanism, we have jurisdiction. Having determined that jurisdiction exists, we turn to the merits.

B. Merits

1. Mandatory Victims Restitution Act

Section 3664 of the MVRA permits victims named in a restitution order to obtain an abstract of judgment and record it as a judgment lien on the defendant's property. See 18 U.S.C. § 3664(m)(1)(B). The relevant provision states:

(A)(i) An order of restitution may be enforced by the United States in the manner provided for in subchapter C of chapter 227 and subchapter B of chapter 229 of this title; or

(ii) by all other available and reasonable means.

(B) At the request of a victim named in a restitution order, the clerk of the court shall issue an abstract of judgment certifying that a judgment has been entered in favor of such victim in the amount specified in the restitution order. Upon registering, recording, docketing, or indexing such abstract in accordance with the rules and requirements relating to judgments of the court of the State where the district court is located, the abstract of judgment shall be a lien on the property of the defendant located in such State in the same manner and to the same extent and under the same conditions as a judgment of a court of general jurisdiction in that State.

18 U.S.C. § 3664(m)(1).

Here, the trial court found, and Fiorentino argues, that the language stating that "[a]n order of restitution may be enforced by the United States " places a limitation on the victim's rights with respect to enforcing a restitution order. 18 U.S.C. § 3664(m)(1)(A) (emphasis added). Specifically, Fiorentino contends that only the United States has the power to enforce a restitution order, and that the victim's only recourse is to request an abstract of judgment and record the abstract, which "shall be a lien on the property of the defendant." 18 U.S.C. § 3664(m)(1)(B).

Systemax, on the other hand, focuses on the language that states that the abstract of judgment serves as a lien "in the same manner and to the same extent and under the same conditions as a judgment of a court of general jurisdiction in that State." 18 U.S.C. § 3664(m)(1)(B). According to Systemax, this phrase indicates that once the victim records the judgment lien, the victim may then proceed to enforce the restitution order in state court as with any other collection proceedings.

Upon review, we find that there are no Florida cases interpreting the statutory provision at bar. There are likewise no federal cases discussing the narrow issue before this Court. Lacking any precedential case law, we must interpret the language of the federal statute in accordance with well-settled principles of statutory interpretation.

The goal of statutory interpretation is to ascertain legislative intent. Patrick v. Hess, 212 So. 3d 1039, 1041 (Fla 2017). We look first to the plain language of the statute. Id. at 1041. If the language is clear and unambiguous, our inquiry stops there. Id. at 1041-42. If the language is ambiguous, however, we apply rules of statutory construction, including the doctrine of in pari materia . Id. at 1042. That doctrine requires statutes that pertain to the same subject or object to be construed together to harmonize them and give effect to the legislative intent. Id.; see also United States v. Witham, 648 F.3d 40, 47 (1st Cir. 2011) (quoting United States v. DiTomasso, 621 F.3d 17, 22 (1st Cir. 2010) ) (stating courts "do not read individual sections of statutes in isolation because ‘the meaning of statutory language, plain or not, depends on the context.’ ").

Here, the express language of 18 U.S.C. 3664(m)(1) authorizes enforcement of a federal criminal restitution order by two parties: (1) the United States, and (2) the victim named in the restitution order. Subsection (A) provides that right to the United States and specifically authorizes two methods of enforcement: (i) in the manner provided for in subchapter C of chapter 227 (dealing with the imposition of fines), and subchapter B of chapter 229 (dealing with collection of unpaid fines and restitution); or (ii) "by all other available and reasonable means." 18 U.S.C. § 3664(m)(1). The government's right to enforce restitution is expansive. See, e.g., Madigan v. Bronstein, 2018 WL 1768283, at *2 (S.D.N.Y. April 12, 2018) ("The robust panoply of enforcement options at the federal government's disposal includes ‘the practices and procedures for enforcement of a civil judgment under Federal...