United States District Court, D. Massachusetts
MEMORANDUM AND ORDER REGARDING RESTITUTION
DOUGLAS P. WOODLOCK UNITED STATES DISTRICT.
to be resolved in this case is the untidy and doggedly
contested problem of restitution under the Mandatory Victims
Restitution Act. I established at sentencing losses totaling
$6, 901, 599.63 for the fraud and deceit charges that provide
the crimes of conviction. This amount presumptively provides
a base line from which a restitutionary order can be ordered.
the Act, restitution is mandatory without consideration of
the defendant's financial circumstances; moreover, the
availability of third party compensation to victims is
disregarded as to those victims whose restitutionary claims
are established by a preponderance of the evidence. 18 U.S.C.
the overall loss, however, only begins the process of
fashioning appropriate restitutionary order. The daunting
issues here have been (I) the problem of proof as to
causation regarding those victims who have actually sought
restitution and (II) the manageability of a distribution plan
for those identifiable victims who have established
entitlement to restitution. Meanwhile, (A) a related
bankruptcy proceeding and (B) a parallel Securities Exchange
Commission civil enforcement action have undertaken
separately to make certain victims whole and otherwise to
deprive the defendants of ill-gotten gains and govern their
conduct in the future. A manageable and efficient plan must
take those proceedings into consideration.
the period of time the problem of restitution has been under
advisement, several putative victims have proven unwilling or
unable to support the discrete claims fully to the
Government. As a consequence, the Government has narrowed the
identifiable victims for whom it presses restitutionary
relief. I am satisfied the Government's screening of
those who have submitted claims is well founded and will
limit restitution to those - except for the defendants'
former corporate vehicle, LocatePlus Holdings Corporation -
whose separate restitutionary claims the Government has also
their part, each of the two defendants - who I now formally
conclude are jointly and severally liable for the
restitutionary losses established because those losses were
reasonably foreseeable to each defendant and caused by one or
both of the coconspirator codefendants during and in
furtherance of their conspiracy together - have mounted a
range of challenges to aspects of restitution orders that
have been under consideration while the question of
restitution has remained open. I have largely rejected those
challenges as to the restitution order now sought by the
order to balance the competing considerations and after full
consideration of the parties' contentions, I have decided
to impose a restitution order that triages among proven
victims the order of payment and the manner of distribution.
Id. at § 3665(f)(2)
stated, payment(s) in full must first be paid to the
individual victim Randy Jurecka in the amount of $76, 799.58.
following the satisfaction of Mr. Jurecka's claim,
payment may be paid to the Special Situations Fund in an
amount not to exceed $4, 871, 034.60.
conclude no other claimants should be addressed in the
restitution order for this criminal case.
identified the claimants entitled to restitution and the
related amounts of restitution to be provided to those
claimants, I turn to the practical questions of
manageability. The manageability challenge is presented in
two basic aspects.
the defendants are as a practical matter now unable to pay
any significant amount of the restitution amount I have
ordered and, moreover, only a portion is likely to be paid by
either of them over time under any conceivable periodic