UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_______________________
No. 01-50464
_______________________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
ESTATE OF ANDREW CLYDE PARSONS
as Represented by its Independent Executor,
Patrick D. Millar,
Defendant-Appellant.
_________________________________________________________________
Appeal from the United States District Court
for the Western District of Texas
_________________________________________________________________
December 11, 2002
Before KING, Chief Judge, JONES, and EMILIO M. GARZA, Circuit
Judges.
EDITH H. JONES, Circuit Judge:
Juries have twice found Parsons guilty of federal arson,
mail fraud, and money laundering. Parsons died while his second
appeal was pending before this Court. We hold that Parsons’s
Estate is not entitled to a return of the criminal forfeiture he
paid the government before his death. More problematically, we are
compelled by the current law of this circuit to conclude that
Parsons’s restitution order does not abate due to his death, and we
must review his now-abated conviction to determine whether the
restitution order was properly awarded. Finding no merit in issues
raised concerning the Speedy Trial Act and the interstate commerce
basis for Parsons’s federal arson charge, we affirm the restitution
order.
I. BACKGROUND
On May 13, 1997, a federal grand jury returned a ten-
count indictment against Parsons alleging that he intentionally
burned a hotel and pavilion he owned in Clifton, Texas. Parsons
appealed after a jury convicted him on all ten counts. This Court
found that Parsons’s trial began outside the time limits prescribed
by the Speedy Trial Act, 18 U.S.C. § 3161, et seq., vacated his
conviction, and remanded to the district court for determination
whether the indictment should be dismissed with or without
prejudice. Without a hearing, the district court dismissed the
indictment without prejudice and denied Parsons’s subsequent motion
to reconsider.
The government reindicted Parsons for two counts of
federal arson in violation of 18 U.S.C. § 844(i), four counts of
mail fraud in violation of 18 U.S.C. § 1341, and four counts of
laundering money from criminally derived property in violation of
18 U.S.C. § 1957. A jury again found Parsons guilty on all ten
2
counts. The district court entered a preliminary judgment of
forfeiture in the amount of $970,826.90; fined Parsons $75,000;
ordered Parsons to pay restitution to the insurance companies that
reimbursed him for his claimed losses in the amount of
$1,317,834.57; ordered Parsons to pay a special assessment of
$1,000; and sentenced Parsons to imprisonment for a term of 78
months and supervised release for a term of three years. Before
Parsons died, the United States Department of Treasury, Bureau of
Alcohol, Tobacco and Firearms received payment for the forfeiture
judgment. Parsons timely appealed his conviction to this Court but
then died. This Court granted a motion to substitute his Estate as
appellant.
II. DISCUSSION
A. Survival of VWPA Restitution Order
The general rule, uncontested by the government, is that
the death of a criminal defendant pending direct appeal of his
conviction abates the criminal proceeding ab initio, as if the
defendant had never been indicted and convicted.1 Unpaid fines and
1
Durham v. United States, 401 U.S. 481, 483, 91 S. Ct. 858,
860, 28. L. Ed. 2d 200, 203 (1971), overruled in part by Dove v.
United States, 423 U.S. 325, 96 S. Ct. 579, 46 L. Ed. 2d 531
(1976); United States v. Wright, 160 F.3d 905, 908 (2d Cir. 1998);
United States v. Logal, 106 F.3d 1547, 1551 (11th Cir. 1997); United
States v. Davis, 953 F.2d 1482, 1486 (10th Cir. 1992); United States
v. Wilcox, 783 F.2d 44 (6th Cir. 1986); United States v. Oberlin,
718 F.2d 894 (9th Cir. 1983); United States v. Pauline, 625 F.2d 684
(5th Cir. 1980); United States v. Moehlenkamp, 557 F.2d 126 (7th Cir.
1977); Crooker v. United States, 325 F.2d 318 (8th Cir. 1963).
3
forfeitures also abate upon a criminal defendant’s death.2 But the
doctrine of abatement does not apply to fines, forfeitures, and
restitution paid prior to a defendant’s death. United States v.
Zizzo, 120 F.3d 1338, 1347 (7th Cir. 1997) (fines and forfeitures);
Asset, 990 F.2d at 214 (restitution); United States v. Schumann,
861 F.2d 1234, 1236 (11th Cir. 1988) (fine). Thus, Parsons’s Estate
is not entitled to a return of the forfeiture judgment paid to the
government before Parsons’s death.
With regard to unpaid restitution orders, this Court has
held that if the purpose of the restitution order is primarily
compensatory rather than penal, it does not abate upon the death of
a defendant pending direct appeal. Asset, 990 F.2d at 214.
Moreover, this court must review the defendant’s criminal
conviction to determine whether the non-abated restitution order
was properly awarded. United States v. Mmahat, 106 F.3d 89, 93 (5th
Cir. 1997). Whether this circuit’s current law, which authorizes
Parsons’s Estate’s appeal, comports with the authorization of
restitution by the Victim and Witness Protection Act, 18 U.S.C. §
3663 (VWPA) is a matter for debate, particularly when it leads to
2
United States v. Christopher, 273 F.3d 294, 297 (3d Cir.
2001) (fines and forfeitures); United States v. Asset, 990 F.2d
208, 211 (5th Cir. 1993) (fines); United States v. Schuster, 778
F.2d 1132 (5th Cir. 1985) (fines); Oberlin, 718 F.2d at 895-96
(fines and forfeitures); Pauline, 625 F.2d at 684 (fines).
4
the strange situation of our reviewing a criminal conviction in
what has become a hypothetical case.
In Asset, this Court relied on United States v. Dudley,
739 F.2d 175 (4th Cir. 1984) and on United States v. Cloud, 921 F.2d
225 (9th Cir. 1990), in concluding that the doctrine of abatement
does not apply to unpaid compensatory restitution awards. Asset,
990 F.2d at 212-14. Cloud does not, however, necessarily support
this Court’s conclusion in Asset. In Cloud, the appellant, who was
still alive, asserted that the portion of his sentence that made
any unpaid balance of his restitution payments due and payable upon
his death violated 18 U.S.C. § 3565(h) (repealed). Section 3565(h)
provided that “an obligation to pay a fine or penalty ceases upon
the death of the defendant” (emphasis added). The court stated in
Cloud that its task was not to decide whether restitution payments
under the VWPA were primarily compensatory or penal in nature but
was instead one of statutory interpretation. The court decided
that the “ceases upon death” provision did not apply to restitution
orders and that interpreting § 3565(h) otherwise could frustrate
the compensatory goals of the VWPA.
Although Cloud recognized the compensatory purpose of
VWPA restitution orders, a purpose that arguably supports this
court’s conclusion in Asset, there is a significant difference
between the two cases. In Cloud, the appellant had unsuccessfully
appealed his conviction before challenging the survival of his
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restitution order, whereas in Asset, the criminal defendant died
pending an appeal of her case, hence her criminal proceeding abated
ab initio. Thus, in Cloud, a judgment of conviction supported the
appellant’s restitution order, but in Asset, the defendant’s
conviction was abated. The Ninth Circuit rejected the argument
that Cloud’s restitution order should abate because Cloud had not
died pending resolution of his direct appeal, and his conviction
had not abated. United States v. Cloud, 872 F.2d 846, 856-57 (9th
Cir. 1989).
In Dudley, the Fourth Circuit held that the abatement
principle does not apply to unpaid restitution orders. Instead of
focusing on the language of the VWPA, which requires a judgment of
conviction to support a restitution award, the court in Dudley
based its holding on the compensatory rather than penal nature of
restitution orders under the VWPA. Dudley, 739 F.2d at 177.
The Eleventh Circuit has rejected the Dudley approach and
concluded that allowing a restitution order to survive the death of
a criminal defendant pending appeal conflicts with the VWPA.
United States v. Logal, 106 F.3d 1547, 1552 (11th Cir. 1997). Under
18 U.S.C. § 3663(a)(1), the court noted, a defendant must first be
convicted of a crime for the court to impose a restitution order,
but the abatement principle leaves the defendant “as if he never
had been indicted or convicted.” See id. (quoting United States v.
Schumann, 861 F.2d 1234, 1237 (11th Cir. 1988)). The Eleventh
6
Circuit concluded that the “absence of a conviction precludes
imposition of the restitution order . . . pursuant to § 3663.”
Moreover, survival of the restitution order would violate the
“fundamental principle of our jurisprudence from which the
abatement principle is derived . . . that a criminal conviction is
not final until resolution of the defendant’s appeal as a matter of
right.” Id.
The Third Circuit recently recognized the Eleventh
Circuit’s view as a minority view, holding that abatement does not
apply to compensatory restitution and allowing the parties to brief
the merits of a conviction in order to challenge a restitution
order. United States v. Christopher, 273 F.3d 294 (3d Cir. 2001).
The D.C. Circuit and the Second Circuit have both declined to offer
an opinion on the issue when decedents’ estates left no assets
against which a claim for restitution could be enforced. United
States v. Wright, 160 F.3d 905, 909 (2d Cir. 1998); United States
v. Pogue, 19 F.3d 663, 665 (D.C. Cir. 1994). Although the Second
Circuit avoided answering the question, it noted that the
“analytical underpinnings of [not applying the abatement principle
to compensatory restitution orders] are not entirely clear . . .
since there is no civil judgment[,] . . . and once the conviction
is vacated there would seem to be no foundation for the order of
restitution.” Wright, 160 F.3d at 908-09.
7
The compensatory purpose of the restitution statutes
supports this circuit’s current position. If restitution orders
did not survive the death of a criminal defendant pending direct
appeal, victims would be forced to expend time and expense to prove
what the defendant did in a claim against his estate. On the other
hand, the VWPA states that restitution may be ordered when
“sentencing a defendant convicted of an offense.” 18 U.S.C.
§ 3663(a)(1)(A) (emphasis added). "We assume that Congress is
aware of existing law when it passes legislation." Michel v. Total
Transp., Inc., 957 F.2d 186, 191 (5th Cir. 1992) (quoting Miles v.
Apex Marine Corp., 498 U.S. 19, 32, 111 S. Ct. 317, 325, 112 L. Ed.
2d 275, 291 (1990)). Federal courts have recognized the abatement
principle for over 100 years, see Menken v. Atlanta, 131 U.S. 405
(1889), yet Congress did not provide for the survival of
restitution orders following the death of a criminal defendant
pending direct appeal.3 Furthermore, although civil litigation may
be costly and time consuming, “nothing precludes the victims from
bringing a separate civil action to prevent any improper benefit to
[the defendant’s] estate.” United States v. Logal, 106 F.3d 1547,
1552 (11th Cir. 1997).
3
Congress did, however, provide that if a victim is deceased,
the court may order restitution to the victim’s estate. 18 U.S.C.
§ 3663(a)(1)(A).
8
This panel is not convinced that this court’s holdings in
Asset and Mmahat comply with the plain language of the VWPA.
Nevertheless, our precedent holds that because the restitution
order here is unquestionably compensatory in nature,4 it survives
Parsons’s death. We proceed to consider the appeal of his
conviction to determine whether restitution was properly ordered.
B. Merits
Parsons’s Estate argues that Parsons’s convictions should
be reversed for three reasons. Parsons’s Estate first contends
that the district court’s reasons for dismissing Parsons’s
indictment without prejudice were inadequate. This Court reviews
the dismissal of an indictment without prejudice due to a violation
of the Speedy Trial Act for an abuse of discretion. United States
v. Blevins, 142 F.3d 223, 225 (5th Cir. 1998).
In determining whether to dismiss an indictment for
noncompliance with the Speedy Trial Act with or without prejudice,
a district court must consider (1) the seriousness of the offense;
(2) the facts and circumstances of the case which led to the
dismissal; and (3) the impact of a reprosecution on the
administration of the Speedy Trial Act and on the administration of
justice. 18 U.S.C. § 3162(a)(2); United States v. Taylor, 487 U.S.
4
The district court ordered restitution in the amount that
Parsons obtained from the insurance companies that paid him for his
claimed losses.
9
326, 333, 108 S. Ct. 2413, 2417, 101 L. Ed. 2d 297, 308 (1988). In
dismissing Parsons’s indictment without prejudice, the district
court properly considered each of the three factors. Parsons was
convicted of a number of serious offenses that reflected an ongoing
scheme of arson and insurance fraud. The trial setting was delayed
past the Speedy Trial Act deadline to assure that Parsons’s
attorney was sufficiently recovered from major surgery to be able
to properly represent Parsons. Nothing in the record suggests that
a dismissal with prejudice would have had deterrent value, and the
public had a significant interest in bringing Parsons to trial on
the charged crimes. Moreover, Parsons did not press his right to
a speedy trial until he filed a motion to dismiss on the day of his
first trial. See Blevins, 142 F.3d at 226 (approving a dismissal
without prejudice for a defendant who did not press his right to a
speedy trial); United States v. Johnson, 29 F.3d 940, 946 (5th Cir.
1994) (same).
Parsons’s Estate asserts that despite the district
court’s consideration of the three factors set forth in 18 U.S.C.
§ 3162(a)(2), its reasons for dismissing Parsons’s indictment
without prejudice are inadequate because the court failed to
consider prejudice to the defendant. Taylor, 487 U.S. at 334, 108
S. Ct. at 2418, 101 L. Ed. 2d at 309 (recognizing that “[a]lthough
the discussion in the House is inconclusive as to the weight to be
given to the presence or absence of prejudice to the defendant,
10
there is little doubt that Congress intended this factor to be
relevant for a district court’s consideration”). The record is
clear, however, that Parsons did not suffer prejudice due to the
delay of his first trial, and he failed to show significant
prejudice from undergoing a retrial that his appellate strategy
rendered likely. See Blevins, 142 F.3d at 225 (even if the
district court does not articulate its reasons for dismissing an
indictment without prejudice, this Court can determine whether the
district court abused its discretion based on the record). The
court had this sequence of events in mind when, on remand, it
dismissed Parsons’s indictment without prejudice. There was
plainly no abuse of discretion.
Second, Parsons’s Estate asserts that he was entitled to
notice and a hearing before the district court decided whether to
dismiss his indictment for a violation of the Speedy Trial Act with
or without prejudice. We decline to follow the Ninth Circuit in
requiring notice and a hearing under these circumstances. United
States v. Pena-Carrillo, 46 F.3d 879 (9th Cir. 1995); United States
v. Delgado-Miranda, 951 F.2d 1063 (9th Cir. 1991). Because the
district court was well-acquainted with the procedural background
of Parsons’s case before it dismissed his indictment without
prejudice, a hearing would not have affected the district court’s
decision. Moreover, the district court substantially complied
with the analysis required by 18 U.S.C. § 3162(a)(2). Finally,
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even if we were to adopt the Ninth Circuit position, which we do
not, we would have to remand to the district court. Since Parsons
is dead, it would be absurd to ask the trial court to enter into a
hypothetical exercise.
Third, Parsons’s Estate contends that his conviction for
federal arson under 18 U.S.C. § 844(i)5 should be reversed because
the government did not present sufficient evidence to allow a
reasonable jury to find that his hotel was used in interstate
commerce or that it affected interstate commerce.6 When reviewing
the sufficiency of evidence, this Court views “the evidence and all
inferences therefrom in the light most favorable to the verdict and
must affirm if a rational jury could have found that the government
proved each element of the offense beyond a reasonable doubt.”
United States v. Cavin, 39 F.3d 1299, 1305 (5th Cir. 1994).
5
18 U.S.C. § 844(i) provides in pertinent part:
Whoever maliciously damages or destroys, or attempts to
damage or destroy, by means of fire or an explosive, any
building, vehicle, or other real or personal property
used in interstate or foreign commerce or in any activity
affecting interstate or foreign commerce shall be
imprisoned for not less than 5 years and not more than 20
years, fined under this title, or both.
6
Parsons’s Estate also contends that if Parsons’s federal
arson conviction on Count 1 is vacated because of insufficient
evidence, Parsons’s convictions on Counts 2, 3, 4, and 5 for mail
fraud and money laundering should also be vacated because they are
inextricably intertwined with the arson described in Count 1.
Because we find the government’s evidence sufficient to support
Parsons’s federal arson conviction, we do not consider the Estate’s
additional arguments.
12
A two-part test governs whether a building satisfies the
interstate commerce requirement of 18 U.S.C. § 844(i). The proper
inquiry “is into the function of the building itself, and then a
determination of whether that function affects interstate
commerce.” Jones v. United States, 529 U.S. 848, 854, 120 S. Ct.
1904, 1910, 146 L. Ed. 2d 902, 909 (2000) (quoting United States v.
Ryan, 9 F.3d 660, 675 (8th Cir. 1993) (Arnold, C.J., concurring in
part and dissenting in part)). The function of a commercial hotel
is to provide guests with a place to stay or a place to hold
events, and such a function affects interstate commerce, especially
when, as in this case, the hotel advertises nationwide and provides
services for out-of-state guests. Moreover, a hotel is an
instrumentality in interstate commerce under the second prong of
the Lopez test and is also a facility that substantially affects
interstate commerce under the third prong of the Lopez test for
upholding federal jurisdiction under the commerce clause. See
United States v. Lopez, 514 U.S. 549, 558-59, 115 S. Ct. 1624,
1629-30, 131 L. Ed. 2d 626, 637 (1994); Heart of Atlanta Motel,
Inc. v. United States, 379 U.S. 241, 85 S. Ct. 348, 13 L. Ed. 2d
258 (1964) (concluding that hotels catering to interstate guests
substantially affect interstate commerce).
Although Parsons concedes that his hotel may have been
used in interstate commerce at some point, he argues that it was
used only for local functions, such as dances, when it was
13
destroyed by fire. Parsons thus argues that use of his hotel at
the time of the fire does not satisfy the Jones requirement of
“active employment for commercial purposes, and not merely a
passive, passing, or past connection to commerce.” Jones, 529 U.S.
at 855, 120 S. Ct. at 1910, 146 L. Ed. 2d at 910. Despite the fact
that Parsons’s hotel may have been closed for the winter season, a
temporary cessation of activity does not place the hotel beyond the
reach of 18 U.S.C. § 844(i) if there is intent to return to the
stream of commerce. See United States v. Williams, 299 F.3d 250
(3d Cir. 2002) (holding that arson of a vacant building available
for rent constituted a federal crime under 18 U.S.C. § 844(i));
United States v. Martin, 63 F.3d 1422 (7th Cir. 1995) (same); United
States v. Turner, 995 F.2d 1357 (6th Cir. 1993) (same). Because a
reasonable jury could have found beyond a reasonable doubt that
Parsons’s hotel was used in interstate commerce, we affirm his
conviction for federal arson under 18 U.S.C. § 844(i).
III. CONCLUSION
Parsons’s Estate is not entitled to a return of the
forfeiture paid to the government by Parsons prior to his death.
Under the rules of Asset and Mmahat, we affirm Parsons’s
convictions on appeal and conclude that Parsons’s Estate must pay
the restitution order.
AFFIRMED.
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