United States v. Bengis
631 F.3d 33
| 2d Cir. | 2011Background
- Defendants Bengis and Noll led a scheme (1987–2001) to illegally harvest South Coast and West Coast rock lobsters in South African waters for export to the United States.
- South Africa governed lobster harvesting under the MLRA and related regulations; illegal lobsters are not the property of harvesters and may be seized by the government.
- U.S. and South African authorities investigated; in 2001 a container of illegally harvested lobsters was seized and another shipment was anticipated.
- Defendants pled guilty to Lacey Act/conspiracy charges; the district court deferred restitution, later referred to a magistrate for recommendations.
- OLRAC provided two restitution methods: Method I (remediation cost) and Method II (market value); district court deferred ruling and then referred to a magistrate.
- District court ultimately denied restitution under MVRA and VWPA, prompting this appeal seeking restitution in favor of South Africa.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether South Africa has a property interest in illegally harvested lobsters. | South Africa has a property right in poached lobsters because regulatory regime permits seizure and sale; illicit lobsters deprive SA of proceeds. | Defendants' conduct damaged regulatory interests, not tangible property unsettled by MVRA; SA did not own the lobsters. | Yes; SA has a property right in illegally harvested lobsters, under regulatory regime and revenue anticipation. |
| Whether South Africa is a 'victim' under MVRA and VWPA. | SA was directly harmed by defendants' conduct through loss of revenue and regulatory benefits. | The harm was not tied to the particular offense; not a direct victim of the specific conduct charged. | Yes; SA is a victim under MVRA and VWPA based on direct loss of revenue from poaching and related concealment. |
| Whether MVRA governs restitution amount and which calculation method applies. | Method II (market value) appropriately traces loss; ORLAC Method II preferred. | Complexity of calculation and foreign-law issues justify withholding restitution under discretion. | MVRA applies; Method II is suitable for calculating loss; no need to avoid restitution due to complexity. |
| Whether the district court erred by balancing sentencing process complexity against restitution. | Complexity does not defeat entitlement when law supports restitution. | Fashioning an order would unduly prolong sentencing. | Complexity does not preclude restitution under MVRA. |
Key Cases Cited
- Pasquantino v. United States, 541 U.S. 349 (U.S. 2005) (the right to collect uncollected excise taxes is property)
- Cleveland v. United States, 531 U.S. 12 (U.S. 2000) (regulatory interest may be non-property; pre-issuance fees not property)
- United States v. Milstein, 481 F.3d 132 (2d Cir. 2007) (recognizes intangible property)
- United States v. Silkowski, 32 F.3d 682 (2d Cir. 1994) (victim and property concepts in restitution)
- United States v. Kalish, 626 F.3d 165 (2d Cir. 2010) (simultaneous restitution and forfeiture permissible)