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Michael P. S. Scanlon v. Greenberg Traurig

April 20, 2011


The opinion of the court was delivered by: Royce C. Lamberth, Chief Judge


Before the Court is defendant Michael Scanlon's Motion [1] to Determine Availability of Objection. Upon consideration of the motion [1], Greenberg Traurig's opposition thereto [3], the reply [4], the government's memorandum regarding the motion [7], and the applicable law, the Court will deny the motion for the reasons set forth below.


In November 2004, defendant pled guilty to a fraud scheme in which he and Jack Abramoff defrauded their Indian tribe clients of over $20 million. On February 11, 2011, Judge Huvelle sentenced defendant to twenty months in prison and ordered him to pay restitution to his victim clients. At the time of sentencing, all victims but the Choctaw and Sandia tribes reported that they had been fully compensated by Greenberg Traurig, LLP (GT), the law and lobbying firm at which Abramoff was employed and with which defendant had a business relationship during the conspiracy. All of the victims that GT compensated had sued or threatened civil litigation against GT for the same conduct in which defendant had engaged. In total, GT paid the victims $17,699,000 in compensation and civil settlement for losses caused by the scheme entered into by defendant and Abramoff.

The Mandatory Victims Restitution Act (MVRA) makes restitution mandatory for certain federal offenses, "seek[ing] primarily to assure that victims of a crime receive full restitution." Dolan v. United States, 130 S. Ct. 2533, 2549 (2010). Section 3664(j) of the MVRA establishes two tiers of restitution claimants-first, victims are fully compensated for all losses, and then insurers and others from whom victims receive compensation are entitled to restitution. The statute provides that:

If a victim has received compensation from insurance or any other source with respect to a loss, the court shall order that restitution be paid to the person who provided or is obligated to provide the compensation, but the restitution order shall provide that all restitution of victims required by the order be paid to the victims before any restitution is paid to such a provider of compensation. § 3664(j)(1) (emphasis added). Consistent with § 3664(j), Judge Huvelle's restitution order required defendant to pay restitution in the amount of $20,191,537.31, with payment of $2,000,000 to the Choctaw and $492,537.31 to the Sandia. No. 05-cr-411, Feb. 11, 2011 [65]. The order further directed that, pursuant to § 3664(j), defendant should pay restitution to GT in the amount of $17,699,000-the total compensation it had paid to the victims.

In his pre-sentencing memorandum, however, defendant had requested an evidentiary hearing allowing him to contest GT's entitlement to restitution under § 3664(j). Defendant argued that GT was involved in the scheme for which he was convicted, and thus challenged his legal responsibility to pay restitution to GT. Accordingly, Judge Huvelle's restitution order provided for a procedure through which this Court*fn1 would resolve (1) whether defendant is permitted as a matter of law to pursue a legal objection that GT is not entitled to compensation under § 3664(j) because of his claim that GT had a role in the same conduct for which he pled guilty, and (2) if so, whether defendant can establish under an appropriate legal standard that GT is not entitled to compensation under § 3664(j). The Court will address the first of these questions here.


At the outset, the Court notes that the government has already represented the victims' interests in obtaining restitution, consistent with its responsibilities under § 3664(e). Outside of the victim context, this section provides that "[t]he burden of demonstrating such other matters as the court deems appropriate shall be upon the party designated by the court as justice requires." § 3664(e). This matter involves a compensation provider's entitlement to restitution under § 3664(j). The Court appreciates the government's recommendation that GT is in the best position to represent its interests in this matter, and will order that GT be designated to do so.

A.Timeliness of Defendant's Motion

GT argues that defendant's motion should be denied because it is untimely. The Court's restitution order required defendant to file his motion "on or before March 13, 2011," which fell on a Sunday. Defendant filed his motion on Monday, March 14, 2011. Under Federal Rule of Civil Procedure 6(a), a filing deadline expressed in a period of days is calculated so as not to end on a Saturday, Sunday, or legal holiday. Fed. R. Civ. P. 6(a)(1)(C). GT correctly notes that this rule, by its language, applies when computing time periods and not when a filing date has been specified. Nevertheless,

Rule 6(a) also can be used for the computation of time in the context of a specified date. Therefore, if the district court orders certain requests and motions to be filed by a specified date and the date is actually a Saturday, Sunday, or legal holiday, the court can extend the deadline to the next day that is not a weekend day or a legal holiday. This is consistent with the recognition that district courts should possess broad discretion in managing their calendars. 4B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1162 (2010 Supp.) (emphasis added). Here, because the specified date of filing fell on a Sunday, the Court will exercise its discretion and consider defendant's motion timely.

B.Legal Basis for Defendant's Motion

The question at issue here-and the threshold question that must be answered before any further proceedings-is whether a defendant ordered to pay restitution can challenge his obligation under § 3664(j) to pay any party that has compensated victims for their losses. There is no dispute that the MVRA, which focuses on ensuring that victims are fully compensated, offers little guidance on this question. As noted above, § 3664(j)(1) provides that "the court shall order that restitution be paid" to insurers or "any other source" from which victims have received compensation. Section 3664(e) provides for challenges "as to the proper amount or type of restitution," but defendant is not disputing the amount of restitution to be paid here; he is challenging GT's ...

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