U.S. v. Woods
Decision Date | 17 October 1985 |
Docket Number | No. 85-3247,85-3247 |
Citation | 775 F.2d 82 |
Parties | UNITED STATES of America, Appellee, v. Anthony J. Pivirotto and John Robert WOODS Appellants. |
Court | U.S. Court of Appeals — Third Circuit |
Thomas A. Livington (argued), and Raymond Radakovich, Pittsburgh, Pa., for appellant.
J. Alan Johnson, U.S. Atty., Paul J. Brysh (argued), Asst. U.S. Atty., Pittsburgh, Pa., for appellee.
Before ADAMS, GIBBONS and WEIS, Circuit Judges.
Defendant pleaded guilty to two of multiple counts for mail fraud which resulted in substantial losses for many unfortunate investors. He contends that an order of restitution imposed as a condition of probation violates his agreement with the government and requires that he be permitted to withdraw his plea. We reject his argument because the likelihood of a restitution order and its extent were fully explained to him by the district court before accepting the plea.
Defendant Woods pleaded guilty to two counts of a 35 count indictment charging mail fraud in violation of 18 U.S.C. Sec. 1341, as well as one count of bankruptcy fraud, 18 U.S.C. Sec. 152. The district court sentenced defendant to terms of imprisonment of two years on count 8, and five years on count 13. The sentence was suspended on count 13, and defendant was placed on probation for five years. As a condition of probation, defendant was directed to make restitution in the sum of $989,218, the obligation being joint and several with co-defendant, Anthony Pivirotto. Woods has appealed.
The indictment alleges that from August 24, 1973 through June 13, 1980, Woods and Pivirotto engaged in a scheme to defraud the investors in Safeguard Investment Company. Pivirotto and Woods controlled Safeguard, which solicited money from investors for the avowed purpose of making mortgage loans on residential properties. Safeguard misrepresented to investors that their deposits were federally insured and that the company was licensed as a banking institution by the Department of Banking of Pennsylvania.
In 1973, Safeguard discontinued its practice of making secured loans to the general public and instead made unsecured loans of over one million dollars to Woods and Pivirotto, as well as to business entities they controlled. Hence, rather than promoting mortgage loans, Safeguard advanced the funds provided by investors to Woods and Pivirotto and also used the money to pay interest on deposits held by Safeguard. After operating at a financial loss, Safeguard filed a petition for reorganization under chapter 11 in May 1980.
On January 29, 1985, defendant Woods' counsel and the United States Attorney negotiated a plea bargain which was incorporated in a letter of that date. Defendant agreed to plead guilty to counts 8 and 13 of the indictment and, in return, the government promised to dismiss the remaining 33 counts. The government also agreed not to recommend a specific sentence to the court. As a part of the bargain the letter stated that the parties understood and agreed that "if this conditional plea agreement is approved by the court, the maximum penalty which may be imposed on the defendant is (a) a term of imprisonment of not more than 10 years; (b) a fine of not more than $10,000; or (c) both."
Before accepting the plea, the court conducted a lengthy Rule 11 colloquy with the government and Woods. The Assistant United States Attorney presented an outline of the evidence about the operation of the scheme. He also asserted that the money defendants received from Safeguard was used to purchase various real estate holdings in Maine, Texas, and Pennsylvania. The court was informed that defendants had turned over to the trustee in bankruptcy some of the property purchased with proceeds from the scheme. Defendants also had relinquished about $300,000 in personal assets. After liquidating various properties, the trustee returned to the investors approximately 21% of the principal they had invested with Safeguard.
The court inquired about the defendant's income and assets and asked Woods to provide a financial statement for the probation officer's use in preparing a presentence report. The court stated:
The court asked defendant Woods questions about his net worth and current income, to which he made vague responses.
In reply defendant stated that he did not intend to mislead the court.
Defendant: Yes Sir."
Only after this lengthy hearing did the court accept the plea.
The sentencing hearing was held four months later. At the beginning of the proceeding, the court announced that on the basis of the pre-sentence report it intended to order restitution in the sum of $989,218, which represented the balance of the principal claimed by investors. No allowance was made for loss of interest.
Counsel then asked that his client be placed on probation.
After pronouncing sentence, the district judge stated that any future payments made by the bankruptcy trustee would reduce the amount of restitution owed by the defendants.
On appeal, Woods contends that the sentence and plea must be vacated because the amount of restitution exceeds the terms of the plea bargain. In the alternative, defendant argues that the district court erred in ordering restitution on the entire scheme rather than just on count 13 to which he pleaded guilty and on which he was placed on probation.
It is the defendant's position that by ordering restitution that was not specifically provided for in the agreement, the court in effect rejected the plea. Consequently, defendant asserts that he should be permitted to withdraw his guilty plea.
We are not persuaded by the defendant's argument, Fed.R.Crim.P. 11(e)(4) provides that if the plea agreement is rejected, the court must advise defendant that it is not bound by the agreement and give him the opportunity to withdraw the plea. In addition, the judge must inform the defendant that if he persists in the guilty plea, "the disposition of the case may be less favorable to the defendant than that contemplated by the plea agreement."
The district judge in this case complied with the requirements of Rule 11. In fact, the court's actions conformed with the terms of the plea agreement between the government and the defendant as far as it went. The period of incarceration was substantially less than the maximum that could have been imposed, and there was no agreement on what punishment would be imposed. The only reference to penalty in the plea agreement letter was a statement as to the maximum that could be directed.
Although not included in the letter there can be no question on this record but that defendant was told in unequivocal terms that restitution would be imposed as part of probation. The lengthy colloquy before the plea was...
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