United States v. Volpendesto

• Decision Date: 06 June 2014
• Docket Number: No. 11–3020.,11–3020.
• Citation: 755 F.3d 448
• Court: U.S. Court of Appeals — Seventh Circuit
• Parties: UNITED STATES of America, Plaintiff–Appellee, v. Samuel VOLPENDESTO, Defendant–Appellant.

755 F.3d 448

UNITED STATES of America, Plaintiff–Appellee,

v.Samuel VOLPENDESTO, Defendant–Appellant.

No. 11–3020.

United States Court of Appeals, Seventh Circuit.

Argued Dec. 11, 2013.

Decided June 6, 2014.

Amarjeet Singh Bhachu, Office of the United States Attorney, Chicago, IL, for Plaintiff–Appellee.

Beau B. Brindley, Blair T. Westover, Law Offices of Beau B. Brindley, Chicago, IL, for Defendant–Appellant.

Before WOOD, Chief Judge, and FLAUM and SYKES, Circuit Judges.

WOOD, Chief Judge.

Samuel Volpendesto's career in organized crime finally caught up to him at the age of 87. Wheelchair-bound and in poor health, he heard the jury return guilty verdicts against him on four counts: racketeering conspiracy, conspiracy to commit arson, arson, and use of a destructive device in relation to a crime of violence. The district court sentenced Volpendesto to prison, entered a forfeiture judgment, and ordered him to pay $547,597 in criminal restitution to the victims of his crimes.

Volpendesto appealed, but he died before we could hear his case. The difficult question we confront, which has divided our sister circuits, is whether a restitution order that is part of a criminal judgment survives when the defendant dies before his appeal can be resolved. We conclude that Volpendesto's death mooted his case and thus the criminal restitution order abates along with everything else covered by the judgment.

I

Volpendesto was the elder statesman of an organized crime operation in West Chicago. His organization, led by Michael Sarno, made money through illegal gambling and jewelry store robberies. He was tried along with four codefendants, including his son Anthony Volpendesto, on a four-count indictment. The jury convicted him on all counts. The details of the gang's crimes are discussed in our opinion resolving the codefendants' appeals. See United States v. Volpendesto et al., 746 F.3d 273 (7th Cir.2014). Here we mention only the facts that are essential for the present appeal.

To maintain its territorial control over illegal gambling, the enterprise once detonated a bomb at a competitor's business, causing losses for the building's owner Richard Slejza and his insurer. The district court found that Volpendesto owed $46,124 to Slejza and the insurer in restitution for this crime. The enterprise's exploits also included heists from Ram Creations jewelry store in Novi, Michigan, and Lenna Jewelers in Hinsdale, Illinois. Volpendesto acted as the getaway driver for these robberies, both of which also led to restitution orders: $256,721 for Ram Creations' owner Narender Agarwal and his insurer, and $244,752 for the owner of Lenna Jewelers, Lynne Friedman, and her insurer. These three items resulted in a total restitution obligation of $547,597, on which Volpendesto was required to make “monthly payments of a minimum of ten percent of his net monthly income as directed by the Probation Office.”

In addition to the restitution order, the district court also imposed an order of forfeiture in the amount of $1,878,172 in favor of the United States. The forfeiture order authorized the United States to take over a residential property, all funds in Volpendesto's name, and any other assets that might become available in the future to satisfy the forfeiture judgment. Pursuant to 18 U.S.C. § 1963( l )(1), the order provided that any person (other than Volpendesto) claiming an interest in the seized property could petition the court within thirty days of notice by publication to adjudicate the validity of his or her alleged interest. Parties failing to file within thirty days were forever barred from asserting a claim. Following disposition of all alleged interests in seized property, the court's final order of forfeiture vested clear title in the government.

We severed Volpendesto's appeal from those of his codefendants upon his death and asked Volpendesto's trial attorney to represent his interests in this appeal.

II

The government's brief opens with a challenge to our appellate jurisdiction, and so we must begin there. The government contends that neither Volpendesto's trial attorney nor Volpendesto's estate has Article III standing to bring this appeal. It reasons that only Volpendesto himself would have had standing to challenge his criminal conviction and sentence, and he is gone. That leaves no one, the government concludes, who is entitled under Article III to pursue this appeal. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). We are entitled to resolve this question, because we always have jurisdiction to reviewour own jurisdiction. Muratoski v. Holder, 622 F.3d 824, 829 (7th Cir.2010).

We find it peculiar to hear this argument from a party that seeks to preserve part of the district court's judgment. Congress provided an appeal of right from judgments in criminal cases. See 18 U.S.C. § 3742; 28 U.S.C. § 1291. Given that fact, we do not see how the district court could impose a restitution order that is immune from challenge by the party that would have to satisfy it. Due process demands no less. Moreover, if Volpendesto's obligation to make restitution can be imposed on the estate, there is no conventional problem with the estate's standing. The estate's injury (a $547,597 liability) is directly traceable to the government's conduct (obtaining the restitution order) and can be remedied by this court through an order of vacatur. See Lujan, 504 U.S. at 560–61, 112 S.Ct. 2130. See also Lexmark Intern., Inc. v. Static Control Components, Inc., ––– U.S. ––––, 134 S.Ct. 1377, 1386, 188 L.Ed.2d 392 (2014) (disapproving the use of the “prudential standing” rubric and emphasizing the obligation of federal courts to hear and decide cases within their Article III jurisdiction).

A contrary ruling would be troublesome. If no one has standing to contest the order, then no one should be bound by it. See Hollingsworth v. Barbour, 29 U.S. 466, 475, 4 Pet. 466, 7 L.Ed. 922 (1830) (“It is an acknowledged general principle that judgments and decrees are binding only upon parties and privies. The reason of the rule is founded in the immutable principle of natural justice, that no man's right should be prejudiced by the judgment or decree of a court, without an opportunity of defending the right.”) (quotation marks omitted). And if no one is bound by the restitution order, then it does not remain in force in any meaningful way.

The question remains under what authority we may consider whether the restitution order abates on death. Courts that find restitution orders survive the defendant's death also find that the defendant's estate has standing to contest them. E.g. United States v. Mmahat, 106 F.3d 89, 93 (5th Cir.1997) (“Because the restitution order survives ... we grant the motion for [the defendant's] heirs to continue the appeal in his stead.”), rev'd by United States v. Estate of Parsons, 367 F.3d 409 (5th Cir.2004) (en banc); United States v. Christopher, 273 F.3d 294, 299 (3d Cir.2001) (restitution order “survives against the estate of the deceased convict”). Courts finding that restitution orders abate allow the defendant's attorney to present the issue on appeal without involving the defendant's estate. E.g., United States v. Rich, 603 F.3d 722, 724 n. 4 (9th Cir.2010) (“The government implies that Rich's attorneys cannot raise this argument without substitution of the estate, but substitution is not required.”).

After oral argument, the government referred us to several cases standing for the proposition that victims as “nonparties cannot directly appeal a restitution order entered against a criminal defendant.” See United States v. Fast, 709 F.3d 712, 715 (8th Cir.2013) (citing ten courts of appeals), vacated and remanded on other grounds sub nom. Vicky v. Fast, 572 U.S. ––––, 134 S.Ct. 1934, 188 L.Ed.2d 955 (2014). But see United States v. Laraneta, 700 F.3d 983, 986 (7th Cir.2012) (distinguishing joinder of victims as parties in district court and victim intervention in appellate proceedings). These cases cut both ways. On the one hand, they are of limited utility here, because they involve victims. Victims lack standing because “allowing victims to appeal would erode the [restitution statute]'s attempt to preserve the [g]overnment's discretion.” Fast, 709 F.3d at 716 (quotation marks omitted); Laraneta, 700 F.3d at 985–86. The government's prosecutorial discretion is not affected if the estate steps into the shoes of the deceased defendant. Rather, the estate becomes the adversarial entity from which the government seeks to compel payment on the order of restitution. See Christopher, 273 F.3d at 299; Taylor v. Sturgell, 553 U.S. 880, 894, 128 S.Ct. 2161, 171 L.Ed.2d 155 (2008) (nonparty preclusion may obtain for succeeding owners of property). On the other hand, a straightforward application of the rule that nonparties are not entitled to take a direct appeal of a restitution order suggests that the estate is barred from defending its own interests in this court.

In our view, the government is making this more complicated than it needs to be. Volpendesto's death does not make it necessary to drag the estate into this case. In this connection, it is important not to conflate two points: (1) whether the appeal is indeed moot; and (2) if yes, then what should happen to the order of restitution. The government has discussed this issue in terms of standing, but that is not accurate. As we held in Parvati Corp. v. City of Oak Forest, 630 F.3d 512 (7th Cir.2010), “[w]hen a party with standing at the inception of the litigation loses it due to intervening events, the inquiry is really one of mootness.” Id. at 516. Volpendesto's death has deprived us of the power to decide the merits, but it does not defeat our authority to resolve the appeal in response to the mootness of the underlying case. See Charles Alan Wright & Arthur Miller, 13C Fed. Prac. & Proc. Juris. § 3533.10 (3d...