UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
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No. 99-20638
Summary Calendar
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UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
DUC HUNG LAM,
Defendant-Appellant.
______________________________________________
Appeal from the United States District Court for the
Southern District of Texas
(98-CR-344-6)
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September 7, 2000
Before SMITH, BENAVIDES, and DENNIS, Circuit Judges.
PER CURIAM:*
Duc Hung Lam pleaded guilty to conspiracy to commit food stamp
fraud and money laundering in federal district court. As an
employee of a retail food market, Lam engaged in food stamp fraud
by purchasing legitimate food stamp benefits at a discount for cash
and then making it appear that the food stamp beneficiary had
purchased food at another retail outlet for the full value. The
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
payments from the illegal redemption of food stamp benefits were
deposited in store accounts, and the proceeds were provided to the
employees to purchase additional food stamp benefits for cash. The
district court sentenced Lam to 37 months’ imprisonment, two years’
supervised release, and ordered him to pay restitution to the
United States Department of Agriculture in the amount of
$818,732.57. Lam now appeals.
I. ANALYSIS
A. Waiver of right to appeal restitution
Adopting the recommendation in the presentence report (PSR),
the district court ordered Lam to pay restitution pursuant to 18
U.S.C. § 3663A (the Mandatory Restitution to Victims Act). In
Lam’s plea agreement, he “waived the right to appeal the sentence
or the manner in which it was determined as the grounds set forth
in Title 18, United States Code, Section 3742 except” for any
upward departure from the Sentencing Guidelines range. The plea
agreement further provided that Lam had agreed to pay any fine or
restitution order; however, no mention of restitution is contained
in the provisions discussing Lam’s waiver of his right to appeal.
Additionally, the Government states that “it is beyond cavil that
Lam was not admonished with respect to the provisions of § 3663A”
and that “the parties did not contemplate that the waiver in the
plea agreement included the order of restitution.” Under the
particular circumstances of this case, we conclude that Lam’s
general waiver of his right to appeal his sentence did not include
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the district court’s restitution order.2
B. Restitution Order
Lam argues that the district court failed to give any reasons
or state any facts supporting its restitution order, and he argues
that the restitution order was excessive. Lam states that he had
no assets, that he was a 24-year-old employee, that he “did not
enjoy the fruits of this illegal scheme beyond his simple
employment,” that he did not share in any of the planning of the
scheme, and that he had no authority over any of the accounts into
which the illegally obtained money was deposited. Lam contends
that requiring him to pay the full amount of restitution
establishes that the district court “wholly failed to consider
[Lam’s] financial resources and earning ability.”
As conceded by Lam, he did not object to the recommendation in
2
This Court has yet to address whether a general waiver of
a right to appeal a sentence encompasses the right to appeal a
restitution order. Other circuits have reached the issue with
differing results. See United States v. Broughton-Jones, 71 F.3d
1143, 1146-47 (4th Cir. 1995) (general waiver of right to appeal a
sentence does not include a challenge to the legality of a
restitution order); United States v. Ready, 82 F.3d 551, 553-60 (2d
Cir. 1996) (explaining that under circumstances presented, the
waiver of appeal in plea agreement did not operate as a waiver of
right to appeal restitution); see also United States v. Zink, 107
F.3d 716 (9th Cir. 1997) (waiver of right to appeal sentence
applied to sentence of confinement and not restitution order); but
see United States v. Greger, 98 F.3d 1080, 1081-82 (8th Cir. 1996)
(wavier of right to appeal all nonjurisdictional issues and failure
to object to restitution order constituted waiver of appeal of
restitution order); United States v. Lester, 200 F.3d 1179, 1179-80
(8th Cir. 2000) (defendant waived his right to challenge the
restitution order when he agreed in the plea agreement to pay
whatever restitution was ordered).
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the PSR that he be ordered to pay restitution for the full amount
of fraudulently obtained proceeds during his involvement in the
scheme. Nor did he object to the restitution order at sentencing.
A restitution order is usually reviewed for an abuse of
discretion; however, when no objection was made in the district
court, as in this case, review is limited to plain error. United
States v. Myers, 198 F.3d 160, 168 (5th Cir. 1999), cert. denied,
120 S. Ct. 2230 (2000). Under Rule 52(b) of the Federal Rules of
Criminal Procedure, this Court may correct forfeited errors only
when the appellant shows that there was an error, which was clear
or obvious, and which affected his substantial rights. United
States v. Calverley, 37 F.3d 160, 162-64 (5th Cir. 1994) (en banc).
Lam’s contention that the district court erred in ordering him
to make restitution of $818,732.57 in light of his insufficient
resources is without merit. As previously set forth, Lam’s
restitution was based upon § 3663A, which makes restitution
mandatory for offenses involving fraud without consideration of the
defendant’s ability to pay. § 3663A(a)(1); Myers, 198 F.3d at 168.
The district court thus was required to order restitution in the
amount of the loss without considering Lam’s financial
circumstances. See Myers, 198 F.3d at 169.3
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Lam’s financial resources is a factor to be considered only
when determining whether restitution is to be made immediately or
through a schedule of payments. 18 U.S.C. § 3664(f)(2)(A). The
district court considered Lam’s ability to pay when ordering the
manner in which restitution was to be made. The district court
4
With respect to Lam’s contention that the amount of
restitution was excessive, Lam made no objection to the PSR’s
determination of the loss resulting from the food stamp scheme
during the time of Lam’s involvement in the offense. The district
court adopted the PSR.4 Lam bore the burden of demonstrating that
the information in the PSR was incorrect, and the district court
was free to adopt the information in the PSR when Lam presented no
evidence to rebut the PSR’s calculation. See United States v.
Glinsey, 209 F.3d 386, 393 (5th Cir. 2000), petition for cert.
filed (U.S. June 11, 2000) (No. 99-10242). Lam has not shown any
error, much less plain error, with the district court’s restitution
order.
C. Rule 11 Admonishment Regarding Restitution
Lam argues that his guilty plea was not voluntarily and
intelligently given because the district court failed to admonish
him with respect to the possibility of having to pay restitution.
Specifically, Lam contends that this omission constituted a
ordered that Lam pay the restitution immediately, “and if it cannot
be paid immediately, it will be due in installments to commence
after the date of this judgment pursuant to a payment schedule that
will be set up by the court.”
4
Likewise, Lam’s assertion that the district court failed to
give reasons for its order of restitution is without merit. The
PSR provided that Lam was to be held responsible for fraudulently
obtained proceeds in the amount of $818,732.57, which was the
amount of proceeds laundered between December 1996 and June 1997.
As set forth above, the district court adopted the reasoning of the
PSR.
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violation of Rule 11 of the Federal Rules of Criminal Procedure and
that such error was not harmless.
“In reviewing whether the district court complied with Rule
11, this Court ‘conduct[s] a straightforward, two-question
‘harmless error’ analysis: (1) Did the sentencing court in fact
vary from the procedures required by Rule 11, and (2) if so, did
such variance affect substantial rights of the defendant?’”
Glinsey, 209 F.3d at 394 (quoting United States v. Johnson, 1 F.3d
296, 298 (5th Cir. 1993) (en banc)). A “substantial right” is
violated when the defendant’s “knowledge and comprehension of the
full and correct information would have been likely to affect his
willingness to plead guilty.” Glinsey, 209 F.3d at 394 (quoting
Johnson, 1 F.3d at 302).
The district court did not inform Lam, as required by Rule
11(c)(1), that he may be ordered to pay restitution. Although the
plea agreement stated that “[t]he defendant acknowledges that he
may be required to make full restitution” and that any fine or
restitution ordered by the court was due immediately, the plea
agreement did not give any indication of a restitution amount. The
plea agreement and the district court, however, both informed Lam
of the possibility having to pay fines totaling at least $500,000.
The plea agreement informed Lam that the maximum fine for
count one (food stamp fraud) was $250,000 and that the maximum fine
for count two (money laundering) was $250,000. When discussing the
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fines for count one, the district court stated that “[t]he penalty
on this count is imprisonment not to exceed 5 years and/or a fine
not to exceed $250,000.” With respect to count two, the court
stated that “[t]he penalty on this count is imprisonment . . . not
to exceed 20 years and/or a fine not to exceed $250,000 . . . .”5
The district court’s admonishment in regard to the amounts Lam
faced as fines can be considered when determining whether Lam was
advised of the possibility of paying restitution. Glinsey, 209
F.3d at 395 (“It is the amount of liability, rather than the label
‘restitution,’ that affects [the defendant’s] substantial rights.
‘Whether the amount to be paid is classed as restitution or fine
ordinarily makes little difference in its bite[.]’”) (citation
omitted). Glinsey’s sentence for his participation in a food stamp
fraud scheme included restitution in the amount of $1,266,317. See
id. at 392. Neither the plea agreement nor the district court
informed Glinsey of the possibility of having to pay restitution,
but the district court did inform him that he could be fined up to
$1,000,000. See id. at 394-95. Noting that a warning about a fine
had the same effect as an admonishment about restitution, this
Court held that Glinsey was not prejudiced “so long as his
liability d[id] not exceed the maximum amount that the court
5
The Government makes the argument that the district court
alerted Lam to the possibility of a fine of up to $1.7 million.
Although we understand the argument, because the district court’s
admonishment regarding the figure of $1.7 million was ambiguous, we
are loathe to rely on that particular admonishment.
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informed him could be imposed as a fine.” Id. at 395. Even though
Glinsey’s restitution order exceeded the $1,000,000 fine about
which Glinsey was warned, rather than remanding the case, we
reduced the restitution order from $1,266,317 to $1,000,000. Id.
In the instant case, we conclude that the district court’s
admonishments sufficiently warned Lam that he was subject to a
total liability of $500,000 in fines. As in Glinsey, we MODIFY the
restitution amount to $500,000, the total amount that the district
court informed Lam he might have to pay. After this modification,
Lam cannot show that a substantial right was violated.
AFFIRMED AS MODIFIED.
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