U.S. v. Lorenzini

• Decision Date: 13 December 1995
• Docket Number: No. 94-30409,94-30409
• Citation: 71 F.3d 1489
• Parties: 95 Cal. Daily Op. Serv. 9446, 95 Daily Journal D.A.R. 16,519 UNITED STATES of America, Plaintiff-Appellee, v. Donald John LORENZINI, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1489

71 F.3d 1489

95 Cal. Daily Op. Serv. 9446, 95 Daily Journal

D.A.R. 16,519

UNITED STATES of America, Plaintiff-Appellee, v. Donald John LORENZINI, Defendant-Appellant.

No. 94-30409.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Sept. 12, 1995.

Decided Dec. 13, 1995.

Michael R. Levine, Assistant Federal Public Defender, Portland, Oregon, for defendant-appellant.

Robert B. Ross, Assistant United States Attorney, Portland, Oregon, for plaintiff-appellee.

Appeal from the United States District Court for the District of Oregon.

Before: SCHROEDER, REINHARDT, and FERNANDEZ, Circuit Judges.

Opinion by Judge REINHARDT; Partial Concurrence and Partial Dissent by Judge FERNANDEZ.

OPINION

REINHARDT, Circuit Judge:

Mr. Lorenzini, the defendant in this case, pleaded guilty to one count of bank fraud, 18 U.S.C. Sec. 1344(2) and was sentenced to five years probation with the following conditions: (1) he serve six months home confinement; (2) he acknowledge responsibility for and pay $25,000 of restitution at $600 per month; and, (3) he repay the government his court-appointed attorney's fees in the amount of $4,000 within one year. Lorenzini has raised a number of issues on appeal. The principal one is whether making repayment of court-appointed attorney's fees a condition of probation violates 18 U.S.C. Sec. 3563(b).

We recently held that the district court may not make repayment of court-appointed attorney's fees a condition of supervised release. United States v. Eyler, 67 F.3d 1386, 1393-94 (9th Cir.1995). For the reasons stated below, we now hold that it is improper to order repayment of court-appointed attorney's fees as a condition of probation.

BACKGROUND

Lorenzini was a used car dealer in Portland, Oregon. He and his five named co-defendants were indicted for running a scheme to defraud banks into lending money to unqualified car purchasers. The scheme involved misrepresenting customers' financial status. In order to obtain loans for customers and thereby increase sales, Lorenzini and his co-defendants inflated their customers' income and assets, failed to report all their liabilities, and failed to inform the banks when customer down payments were paid on credit or deferred.

A grand jury indicted Lorenzini on one count of conspiracy 18 U.S.C. Sec. 371 and two counts of bank fraud 18 U.S.C. Sec. 1344(2). (Counts 1, 8, and 9 in the 16-count Superseding Indictment). Thereafter, he entered into a plea agreement with the government. He pleaded guilty to Count 9; in return the government agreed to move to dismiss the other two charges.

Count 9 alleged that on November 25, 1988, Lorenzini knowingly executed a scheme to defraud Seafirst Bank by means of false representations. More specifically, it alleged that in a transaction involving the sale of one car, Lorenzini "filled out and signed [a] buyers' order" that failed to reveal that part of the down payment was borrowed from a credit institution in a loan arranged by the dealership and that part of the loan was deferred. Further, the buyer's order falsely reported customers' income. The Presentence Report assessed the loss to the bank associated with Count 9 to be $4,725.61.

In the plea agreement, the government agreed to recommend that the district court sentence Lorenzini to six months home confinement with work release and order restitution and/or fines in the amount of $2,500. ¹ In arriving at Lorenzini's offense level of ten, the plea agreement stated that: "The amount of losses for overt acts listed in the indictment in which Mr. Lorenzini is named, and therefore the amount of relevant conduct urged by the government, is between $20,000-$40,000." This amount includes conduct for which Lorenzini was charged but not convicted. In the next paragraph of the plea agreement the government agreed to recommend that the court order Lorenzini to pay only $2,500 in restitution and/or fines.

At sentencing, the district court imposed a more onerous sentence than that to which Lorenzini and the government had agreed. Before doing so, the district court gave Lorenzini the opportunity to withdraw his guilty plea. The court stated that if he chose to stand on his guilty plea, he would be sentenced to five years probation with the following conditions: (1) he serve six months home confinement; (2) he acknowledge responsibility for and pay $25,000 in restitution at $600 per month; and, (3) he repay the government his court-appointed attorney's fees in the amount of $4,000 within one year. ² Although Lorenzini objected to the restitution order, he did not withdraw his plea. He was sentenced to five years probation with these conditions.

DISCUSSION

I. Repayment of Attorney's Fees as a Condition of Probation

In addition to ordering Lorenzini to serve six months home detention and pay restitution of $25,000, the district court sentenced him to five years of probation. The court conditioned Lorenzini's probation upon his repaying the government for the Criminal Justice Act (CJA) ³ funds expended for his defense. Lorenzini challenges the authority of the district court to impose repayment of CJA funds as a condition of his probation.

District courts are permitted by statute to order recoupment of CJA funds upon a finding of availability. ⁴ The question before us, therefore, is not whether a judge may order a convicted defendant to repay the amount of his court-appointed attorney's fees, but whether such repayment may be made a condition of his probation. While other circuits have split on this question, this is the first time that we have been asked to consider it. ⁵

The statute governing probation, 18 U.S.C. Sec. 3563, sets forth certain mandatory conditions of probation and allows for the imposition of discretionary conditions as long as they are reasonably related to the purposes of sentencing in 18 U.S.C. Sec. 3553(a)(1) & (2). The United States Sentencing Guidelines contains 25 enumerated recommended conditions of probation, U.S.S.G. Sec. 5B1.4, and recognizes the court's authority under 18 U.S.C. Sec. 3563(b) to impose additional discretionary conditions. Reimbursement of attorney's fees is not among the mandatory conditions listed in 18 U.S.C. Sec. 3563(a), nor is it one of the twenty-five recommended conditions of probation in U.S.S.G. Sec. 5B1.4.

Discretionary conditions of probation must serve one of the following purposes or objectives: (A) "to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense;" (B) "to afford adequate deterrence to criminal conduct;" (C) "to protect the public from further crimes of the defendant;" and (D) "to provide the defendant with needed educational or vocational training, medical care, or other correctional treatment in the most effective manner." 18 U.S.C. Sec. 3553(a)(2) (referenced by 18 U.S.C. Sec. 3563(b)). A discretionary condition must be reasonably related to one or more of these goals and must involve only such deprivations of liberty or property as are reasonably necessary to accomplish the purposes of sentencing. 18 U.S.C. Sec. 3563(b). If a condition of probation does not meet these requirements, it is invalid. ⁶

We recently held that the imposition of payment of attorney's fees is not a valid condition of supervised release. United States v. Eyler, 67 F.3d at 1393-94. The statute governing supervised release is similar to that governing probation in that it allows the sentencing judges to consider purposes (B), (C), and (D) set forth above in fashioning conditions of supervised release. 18 U.S.C. Sec. 3583(d)(1) (referencing 18 U.S.C. Sec. 3553(a)(2)(B), (a)(2)(C), and (a)(2)(D)). We held in Eyler that payment of court-appointed attorney's fees is not reasonably related to any of those three provisions. Therefore, the question before us is whether the repayment of attorney's fees is reasonably related "to the need for the sentence imposed to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense," 18 U.S.C. Sec. 3553(a)(2)(A), and whether it involves only such deprivation of liberty or property as is reasonably necessary to accomplish the purposes of sentencing.

We conclude that repayment of attorney's fees is not a valid condition of probation because it is not reasonably related "to the need for the sentence imposed to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense," 18 U.S.C. Sec. 3553(a)(2)(A). We also conclude that because the government has a number of other less drastic means by which it can enforce a court order to repay attorney's fees, conditioning probation on repayment of fees is not reasonably necessary to any legitimate sentencing objective.

Repayment of attorney's fees is not reasonably related to the purposes of subsection (A) of 18 U.S.C. Sec. 3553(a)(2), the one part of the relevant statute that we were not required to consider in Eyler. The repayment of fees bears no reasonable connection to the need for a sentence "to reflect the seriousness of the offense" because the repayment is simply not punitive in nature. Requiring defendants who can do so to pay for the costs of their defense is an elementary part of the way the criminal justice system operates in this nation. The government bears the cost only when the defendant is unable to do so. The purpose of requiring repayment when it turns out that the defendant has the necessary funds available is to implement that basic principle. That the requirement is not related to the seriousness of the crime is plainly demonstrated by the facts of the case before us. It follows from what we have said that an order to repay attorney's fees is also not reasonably related to the goal of "provid[ing] just punishment" for the offense.

Nor does repayment of attorney's fees bear any reasonable relationship to "promot[ing]...