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United States v. Pelletier

United States District Court, D. Maine

November 7, 2017

UNITED STATES OF AMERICA,
v.
MICHAEL PELLETIER

          ORDER ON DEFENDANT'S MOTION TO REDUCE RESTITUTION, MOTION FOR RETURN OF PROPERTY, AND MOTION FOR SENTENCE REDUCTION

          JOHN A. WOODCOCK, JR. UNITED STATES DISTRICT JUDGE

         A criminal defendant was tried and convicted of Social Security Fraud and conspiring to import and distribute marijuana, among other things. The defendant moves to reduce the amount of restitution he owes the Social Security Administration, for the return of certain property subject to forfeiture, and for a reduction in his sentence. The Court denies the motions because it correctly imposed these penalties and, if not, the Court does not have the power to alter the defendant's final criminal sentence more than ten years after it was imposed.

         I. PROCEDURAL BACKGROUND

         On September 7, 2006, a federal grand jury indicted Michael Pelletier for conspiring to import and distribute marijuana, Social Security fraud, money laundering, and structuring. Indictment (ECF No. 1). At the arraignment, on September 15, 2006, Mr. Pelletier pleaded not guilty on all counts. Minute Entry for Arraignment Proceeding (ECF No. 71).

         From July 12 to July 19, 2007, Mr. Pelletier was tried before a jury. Trial Tr. (ECF. No. 302, 307-308, 311-12, 335, 338-39, 399-400, 406, 411-13, 518-19). The Government produced documentary and testimonial evidence that Mr. Pelletier had knowingly failed to disclose any employment or income while receiving benefits from approximately 1977 through 2006. See Trial Tr. at 176:8-177:18 (ECF No. 413).

         On July 19, 2007, Mr. Pelletier was found guilty on all counts, with the exception of one of the money laundering counts, which the Government dropped. See Jury Verdict (ECF No. 280). The jury found that the conspiracy involved the distribution of 1, 000 kilograms or more of marijuana. Id. (Count 2). This finding- combined with Mr. Pelletier's prior convictions-made him subject to a statutorily mandated life sentence. See 21 U.S.C. § 841(b)(1)(A) (“If any person commits a violation of this subparagraph . . . after two or more prior convictions for a felony drug offense have become final, such person shall be sentenced to a mandatory term of life imprisonment without release . . . .”); U.S.S.G. § 5G1.1(b) (“Where a statutorily required minimum sentence is greater than the maximum of the applicable guideline range, the statutorily required minimum sentence shall be the guideline sentence”).

         On January 22, 2008, the Court sentenced Mr. Pelletier to life in prison, and ordered him to pay restitution. Min. Entry (ECF No. 382). On January 23, 2008, the Court entered the judgment against Mr. Pelletier, including a restitution amount of $83, 847.55 to the Social Security Administration. J. (ECF No. 384). On February 5, 2008, the Court, as permitted by Federal Rule of Criminal Procedure 36, twice amended the judgment to correct clerical mistakes. Amended J. (ECF No. 388); Second Amended J. (ECF No. 390). The Court, after assessing Defendant's ability to pay, ordered immediate payment of the $83, 847.55 restitution obligation in a lump sum. Second Amended J. at 6-7 (ECF No. 390). The Court provided that any amount Mr. Pelletier was unable to pay immediately was due and payable during his term of incarceration. Id. Mr. Pelletier's counsel stated that he had no objection following the Court's statement during sentencing that Mr. Pelletier's “[r]estitution is mandatory in the amount of $83, 847.55.” Sentencing Tr. at 16:8-15 (ECF No. 521).

         The Court also ordered forfeiture of several pieces of real and personal property, including several automobiles. Final Order of Forfeiture (ECF No. 383); Second Amended J. (ECF No. 390). One such piece of real property was located at 574 Main Street, Van Buren, Maine (“the Property”). Id. That property consisted of an automotive shop and upstairs residence that Mr. Pelletier purchased for $19, 000. Id.; Trial Tr. at 56:14-69:6 (ECF No. 412). During the charge conference at the close of trial, the Government stated that it intended to dismiss Count Four, the money-laundering charge pertaining to the Property, but the Property remained relevant to forfeiture based on the drug charges contained in Counts One and Two because evidence showed that the money used to purchase and improve that property "was drug money." Trial Tr. at 28:14-33:20 (ECF No. 413). Defense counsel did not object. Id. The Jury returned a verdict in favor of forfeiture of the Property based on its finding that the Property was derived from proceeds Mr. Pelletier obtained from his involvement in the drug offenses in Counts One and Two of the indictment for which he had been convicted. Verdict Form at 1 (ECF No. 281).

         On January 29, 2008, Mr. Pelletier appealed his conviction based on evidentiary issues, jury instructions, and the sufficiency of the evidence, but he did not appeal the forfeiture order or the restitution amount. Notice of Appeal (ECF No. 385); United States v. Pelletier, 666 F.3d 1 (1st Cir. 2011). On December 1, 2011, The United States Court of Appeals for the First Circuit affirmed Mr. Pelletier's conviction. Pelletier, 666 F.3d at 12. The United States Supreme Court denied Mr. Pelletier's petition for a writ of certiorari and his petition for rehearing. Pelletier v. United States, 132 S.Ct. 2683 (2012); Pelletier v. United States, 133 S.Ct. 92 (2012).

         On May 30, 2013, Mr. Pelletier filed a motion under 28 U.S.C. § 2255 arguing that he was illegally detained and sentenced. Pet'rs' Mot. to Vacate, Correct, or Set Aside an Illegal Sentence Pursuant to 28 U.S.C. § 2255 (ECF No. 682). On June 17, 2014, the Magistrate Judge issued a recommended decision in which he recommended that the § 2255 petition be denied. Recommended Decision on 28 U.S.C. § 2255 Mot. (ECF No. 712). On July 28, 2014, Mr. Pelletier objected to the recommended decision. Movant's Objs. to the Magistrate Judge's R. & R. (ECF No. 715). On December 29, 2014, Mr. Pelletier filed a motion to supplement his § 2255 petition and the Court granted his motion on December 30, 2014. Mot. to Supplement (ECF No. 718). On January 14, 2015, Mr. Pelletier filed a motion to amend his § 2255 motion. Mot. to Amend Pet. (ECF No. 722). On February 4, 2015, the Government responded to Mr. Pelletier's motion to amend and supplement his petition. Resp.'s Obj. to Pet'r's Third Mot. to Amend his Previously Amended and Supplemented 28 U.S.C. § 2255 Pet. (ECF No. 723). On March 19, 2015, the Government responded to Mr. Pelletier's motion to supplement. Gov't's Resp. to Pet'r's Supplement to his Thrice- Amended 28 U.S.C. § 2255 Mot.; and Renewed Mot. for Summ. Dismissal (ECF No. 729).

         On April 6, 2015, Mr. Pelletier sought the return of the Property and argued that his restitution obligation should be recalculated to reflect only the amount of Social Security benefits he received within the five-year period preceding his indictment, rather than the whole period since 1977. Mot. to Supplement (ECF No. 730). On November 24, 2015, the Court ruled that Defendant's forfeiture and restitution arguments were time-barred and not cognizable in § 2255 proceedings. Order Affirming the Recommended Decision of the Magistrate Judge at 12 (ECF No. 733).

         On January 26, 2016, Mr. Pelletier appealed the order. Notice of Appeal (ECF No. 736). On March 7, 2017, the First Circuit denied his request for a certificate of appealability and terminated his appeal. Pelletier v. United States, No. 16-1119 (1st Cir. Mar. 7, 2017) (ECF No. 757).

         On March 13, 2017, Mr. Pelletier moved for a reduction of the restitution obligation due to the Social Security Administration. Mot. to Reduce Restitution (ECF No. 758) (Def.'s Restitution Mot.). On March 20, 2017, the Government responded. Gov't's Resp. in Opp'n to Def.'s Mot. to Reduce Restitution (ECF No. 764) (Gov't Restitution Opp'n). On April 24, 2017, Mr. Pelletier replied to the Government's response. Reply to Gov't's Response (ECF No. 765) (Def.'s Reply).

         Also on March 13, 2017, Mr. Pelletier moved for the return of the Property. Rule 41(g) Mot. for Return of Property (ECF No. 759) (Def.'s Forfeiture Mot.). The Government responded on April 7, 2017. Gov't's Resp. in Opp'n to Def.'s Mot. for Return of Property (ECF No. 760) (Gov't Forfeiture Opp'n). Mr. Pelletier did not reply to the Government's response.

         On May 11, 2017, Mr. Pelletier moved for a hearing regarding a reduction of his sentence. Mot. for Sentence Reduction (ECF No. 767) (Def.'s Sentence Mot.). The Government responded on May 22, 2017. Gov't's Obj. to Def.'s Mot. for Sentence Reduction (ECF No. 768) (Gov't Sentence Opp'n). Mr. Pelletier did not reply to the Government's response.

         II. THE PARTIES' POSITIONS

         A. Motion to Reduce Restitution

         1. Michael Pelletier's Motion

         Mr. Pelletier argues that the Court's restitution order of $83, 847.55 was improper because payments by the Social Security Administration are subject to a five-year statute of limitations. Def.'s Restitution Mot. at 1. He cites United States v. Silkowski, 32 F.3d 682 (2nd Cir. 1993), in support of this argument. Id. He points out that he was receiving less than $500.00 per month in disability benefits, and he concludes that a large portion of his restitution order must have been based on Social Security payments beyond the five-year period preceding his indictment. Id.

         2. The Government's Response

         The Government responds that Mr. Pelletier is not entitled to reduced restitution for three reasons. First, the Government argues that the restitution obligation constitutes a final judgment that cannot now be challenged unless one of a few narrow exceptions applies. Gov't Restitution Opp'n at 4. The Government contends that none of these exceptions applies to Mr. Pelletier's now nine-year-old restitution order. Id. at 4-10.

         Second, the Government claims that even if the order could be challenged at this late date, the restitution amount was proper. Id. at 10. The Government maintains that the Court properly based the restitution amount on the whole thirty year period and was unconstrained by the five-year statute of limitation period of 18 U.S.C. § 3283(a). Id. It cites United States v. Williams, 356 Fed. App'x 167, 170 (10th Cir. 2009); and United States v. Brown, 665 F.3d 1239, 1253 (11th Cir. 2011) for the proposition that defendants must pay restitution for losses occurring outside the statute of limitations period when the offense encompassed a “scheme” extending beyond that period. Id. at 10-11. Social Security Fraud under 42 U.S.C. § 408(a)(4), the Government insists, is an offense containing such a scheme. Id. at 11. The Government also argues that the restitution order was proper because courts have allowed restitution for conduct closely related to the offense of conviction. Id. at 11-12 (citing Brown, 665 F.3d at 1252; United States v. Valladares, 544 F.3d 1257, 1268-70 (11th Cir. 2008)). The Government portrays Silkowski as irrelevant, because it was decided before the enactment of 28 U.S.C. § 3663A in the Mandatory Victims Restitution Act, which now controls the Court's authority to impose restitution. Id. at 12.

         Third, the Government argues that, to the extent Mr. Pelletier's Restitution Motion can be construed as a § 2255 petition, the relief sought is unavailable. Id. (citing Order Affirming the Recommended Decision of the Magistrate Judge (ECF No. 733); United States v. Chorney, 453 Fed. App'x 4, 8 (1st Cir. 2011)).

         3. Michael Pelletier's Reply

         Mr. Pelletier's reply focuses on the substantive propriety of the restitution amount and the damage to the fairness, integrity, and public reputation of the judiciary from an unauthorized order. See Def.'s Reply at 3 (quoting United States v. Burns, 843 F.3d 679 (7th Cir. 2016)). Mr. Pelletier points to two district court cases from this circuit concluding that the fraudulent receipt of Social Security payments constitutes a series of individual offenses each subject to the statute of limitations, rather than a “continuing offense” which would authorize restitution beyond the statute of limitations period. Id. at 1-2 (citing United States v. Bundy, No. 2:08-cr-196-DBH-1, 2009 WL 902064, at *1 (D. Me. Mar. 31, 2009); United States v. Powell, 99 F.Supp.3d 262, 264-65 (D.R.I. 2015)).

         Finally, Mr. Pelletier argues that the Court can modify its previous order or re-sentence him because the Supreme Court has indicated that district courts retain their power to determine restitution amounts beyond the time limits imposed in 18 U.S.C. § 3664. Id. at 2 (citing Dolan v. United States, 560 U.S. 605 (2010)).

         B. Motion to ...


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