Case Information
‐ ‐ cr In the
United States Court of Appeals
for the Second Circuit A UGUST T ERM No. ‐ cr
U NITED S TATES OF A MERICA Appellee
B ENJAMIN V ILOSKI Defendant Appellant
On Appeal District Court Northern New York
A RGUED : O CTOBER D ECIDED : F EBRUARY Clerk directed amend caption this appeal indicated above.
Before: K EARSE W ALKER AND C ABRANES Circuit Judges
question presented is criminal forfeiture
imposed defendant appellant Benjamin (“Viloski”) violates Excessive Fines Clause Amendment. argues District Court Northern District New York (David N. Hurd, Judge ) erred when it declined consider Viloski’s age, health, condition determining previously issued forfeiture order $1,273,285.50 unconstitutionally excessive. argues even if District properly ignored his personal circumstances, is nonetheless unconstitutional light described (1998).
We hold court reviewing a under Clause consider—as part proportionality determination required —whether future ability earn living. We further hold, however, courts should circumstances distinct factor. Applying conclusions present case, conclude constitutional “grossly disproportional” gravity Viloski’s offenses. therefore AFFIRM October Order Court.
P ETER G OLDBERGER (Pamela A. Wilk, on brief ), Ardmore, PA, for Defendant Appellant . G WENDOLYN E. C ARROLL (Steven D. Clymer, on brief ), Assistant United States Attorneys, for Richard S. Hartunian, United States Attorney for Northern District New York, Syracuse, NY, Appellee
J OSÉ A. C ABRANES Circuit Judge : question presented criminal
imposed appellant Benjamin (“Viloski”) violates Excessive Fines Clause Amendment. argues District Court Northern District New York (David N. Hurd, Judge ) erred when declined Viloski’s age, health, condition determining previously issued order $1,273,285.50 unconstitutionally excessive. argues even if properly ignored circumstances, nonetheless unconstitutional light described (1998). hold court reviewing under Clause consider—as part proportionality
determination required by —whether his future ability earn a living. We further hold, however, courts should a circumstances a distinct factor. Applying conclusions present case, determine constitutional “grossly disproportional” gravity Viloski’s offenses. therefore AFFIRM October 16, Order Court.
I. BACKGROUND
Viloski a lawyer real estate broker who worked with Dick’s Sporting Goods (“DSG”) a number development projects. From through he participated kickback scheme involving construction new DSG stores, developers or landlords paid “consulting” fees—sometimes exchange work never performed—to his capacity DSG’s broker. passed all part each payment codefendant Joseph Queri, Jr. (“Queri”), senior DSG executive, who took payments without DSG’s knowledge. sometimes paid Queri through real estate company owned by codefendant Gary Gosson (“Gosson”).
2009, Viloski was charged a twenty ‐ count indictment related to activities. After a three ‐ week trial, a jury convicted him of one count of conspiracy to commit mail and wire fraud, two substantive counts mail fraud, one count conspiracy to commit money laundering, three counts aiding and abetting money laundering, one count aiding and abetting transactions criminally derived property, and one count making false statements. He acquitted on remaining counts.
On January District Court sentenced Viloski principally to below Guidelines term five years’ imprisonment and three year term supervised release. The Court ordered Viloski to pay total $75,000 restitution to two developers and—most relevant here—to forfeit $1,273,285.50, which equaled amount funds had acquired landlords and developers, laundered through two entities he controlled, and passed Queri. District Court ordered forfeiture pursuant U.S.C. § 982(a)(1), criminal statute; U.S.C. § 981(a)(1)(C), civil statute; and U.S.C. § 2461(c), which “integrate[s § 981(a)(1)(c)] into proceedings,” Contorinis n.2 2012). appealed this Court, affirmed conviction and sentence remanded case *6 determine whether its order violated the Excessive Fines Clause, U.S. Const. amend. VIII. Viloski 557 F. App’x (“ Viloski I ”). specifically directed the District Court evaluate in light U.S. 321.
On remand, District Court interpreted requiring courts consider following factors, known “ factors,” determining violates Clause:
(1) essence crime and relation other activity; (2) fits into class persons whom statute principally designed; (3) maximum sentence and fine could been imposed; and nature harm caused conduct. Viloski F. Supp. 3d (N.D.N.Y. 2014). agreed were relevant argued Court should age, “poor health,” “physical and
civic disabilities,” and inability pay forfeiture. Id. 532. emphasized “his lack culpability lack profit the scheme compared co ‐ Queri.” Id. Although the District Court expressed sympathy some considerations, it declared them irrelevant, “[t]he Supreme Court [had] limited inquiry the Bajakajian factors.” Id. Accordingly, after considering those factors, District Court concluded did violate Eighth Amendment. Id. This appeal followed.
II. DISCUSSION
The Supreme Court first applied Excessive Fines Clause v. U.S. (1998), which established two ‐ step inquiry determining whether penalty is excessive under Eighth Amendment. At first stage, we determine Excessive Fines Clause applies all. Id. If we conclude does, we proceed second step determine unconstitutionally excessive. Id. applying determine de novo “whether fine constitutionally excessive,” although must accept Court’s factual findings “unless clearly erroneous.” Id. *8 & n.10. “The burden rests on the defendant to show the unconstitutionality the forfeiture.” United States v. Castello , 611 (2d Cir. 2010). [6]
A. Step One: Does the Excessive Fines Clause Apply?
1. Legal Framework
First, must determine at issue constitutes “a ‘fine’ within meaning Clause.” Bajakajian U.S . at 334. That clause applies only to those forfeitures characterized, at least part, “punitive”— i.e. forfeitures defendant personally liable. Id. at 327– 28; An Antique Platter Gold (describing “punitive” those forfeitures “imposed culmination proceeding required conviction underlying felony could not been imposed upon an innocent party”). contrast, purely “remedial” forfeitures— i.e. those rem forfeitures intended not punish but to compensate Government loss restore property *9 rightful owner—fall outside scope of Excessive Fines Clause. Bajakajian 524 U.S. at 329; also Paroline v. United States 134 S. Ct. (“The primary goal of restitution remedial compensatory, it serves punitive purposes. That sufficient bring it within purview of Excessive Fines Clause.” (internal quotation marks, citations, and alteration omitted)).
2. Application
As concluded I Excessive Fines Clause applies here. See F. App’x at 36. The challenged forfeiture—which expressly linked specific offenses—fits easily within definition of punitive forfeitures just expounded: it was “imposed culmination of criminal proceeding required conviction of underlying felony,” and it “could been imposed upon an innocent party.” Cf. Platter Gold 139. *10 B. Step Two: Is the Forfeiture Unconstitutionally Excessive?
1. Legal Framework
If determine is punitive, we must proceed step two, which asks is unconstitutionally excessive. A unconstitutionally excessive “if grossly disproportional gravity defendant’s offense.” Although did provide test gross disproportionality, have interpreted decision requiring us following factors, have become known “ factors”:
(1) essence crime defendant relation other activity, (2) fits into class persons whom statute principally designed, (3) maximum sentence fine could been imposed, nature harm caused conduct. George (quoting
Castello 120).
omitted)). Here, contrast, Government has moved against proceeds themselves—which transferred Queri very act money laundering—but against personally.
The principal question in this appeal whether factors are exhaustive—a question we have never addressed directly. Our cases interpreting Bajakajian have neither added to the factors nor described them as comprehensive. See, e.g. , George , 779 F.3d 122 (“Consistent with Bajakajian , this court has identified following factors as relevant proportionality assessment . . . .”); Castello , 611 F.3d 120 (“Four factors, distilled Bajakajian , guide our analysis . . . .”). some cases, however, implicitly cautioned against applying factors too rigidly. See, e.g. , United States v. Collado 323, 328 (2d Cir. 2003) (“ Among factors that [Supreme] Court considered . . . .” (emphasis supplied)); accord v. Varrone (2d Cir. 2009); Elfgeeh (determining was excessive based three factors when record silent as fourth).
Our unwillingness in past cases describe factors exhaustive reflects itself, never prescribed those rigid test. To contrary, Supreme Court expressly noted case had “not argue[d] *12 his wealth or income [were] relevant proportionality determination that full deprive him his livelihood.” Bajakajian , 524 U.S. 340 n.15. And several circuits recognized potential relevance additional factors. [9]
Indeed, itself leads us conclude that one additional factor especially important. opinion emphasizes Clause grew out English constitutional tradition, including Magna Carta, required fine “should deprive wrongdoer his livelihood.” , 524 U.S. 335; Browning ‐ Ferris Indus. Vt., Inc. v. Kelco Disposal, Inc. , 492 257, 269, 271 (noting Magna Carta’s requirement an “amercement”—a payment Crown as penalty some offense—“not be so large [an offender] livelihood”). As First Circuit has recognized, hostility livelihood ‐ destroying fines became “deeply rooted” in Anglo ‐ American constitutional thought played an important role shaping Amendment. United States v. Levesque 546 F.3d 78, (1st Cir. 2008). light this strong constitutional pedigree, *13 seems unlikely the meant preclude courts from considering a would deprive an offender of his livelihood.
We therefore hold that, when analyzing a forfeiture’s proportionality under the Clause, courts may consider—in addition factors we previously derived from —whether would of livelihood, i.e. his “future ability earn a living,” Levesque
In so holding, heed Supreme Court’s instruction “the test for excessiveness of a punitive involves solely a proportionality determination.” 333–34 (emphasis supplied). Whether a destroy a *14 defendant’s livelihood is a component proportionality analysis, not a separate inquiry. Accordingly, a deprives a defendant his livelihood might nonetheless constitutional, depending his culpability other circumstances. Moreover, courts need this fifth factor all cases. Indeed, neither nor our previous cases done so. We hold only proportionality determination required by is sufficiently flexible to permit such consideration. emphasize asking a would
destroy a defendant’s future livelihood is different considering a discrete factor a present personal circumstances, including age, health, situation. While hostility livelihood destroying fines is deeply rooted our constitutional tradition, consideration circumstances not. See factual predicate application statutes has been satisfied, therefore, a district court has no discretion order amount sought. court’s role conduct gross disproportionality inquiry required Bajakajian. Cf. U.S. n.11 (declining address “whether a court disregard terms a statute commands full forfeiture”). Here part ways with First Circuit. Levesque
(adopting three factor test requiring separate inquiry livelihood). If Amendment permits Government end some offenders’ lives, see, e.g. Gregg Georgia (1976), surely permits Government destroy other offenders’ livelihoods. , 524 U.S. 335–36 (noting that Magna Carta “required that amercements (the medieval predecessors fines) should
proportioned offense that they should a wrongdoer livelihood”); cf. San Antonio Indep. Sch. Dist. v. Rodriguez 411 U.S. 1, 22 (noting in equal protection context that no “constitutional mandate” requires judges consider “the defendant’s ability pay” a fine).
We are mindful Supreme Court’s admonition that “judgments about appropriate punishment an offense belong in first instance legislature.” 524 U.S. Our role reviewing criminal forfeitures solely examine them gross disproportionality; other respects, we must defer Congress. See id. ; Solem v. Helm 290 nn. 16 & 17 (1983). Bearing limited role mind, hold courts as a discrete factor a defendant’s personal circumstances, such age, health, present condition, when considering criminal violate Clause. so holding, are accord with every sister circuit has addressed question directly.
*16 A contrary interpretation would conflict with one of Congress’s basic premises providing forfeitures: forfeitures should be “concerned not with how much an individual has with how much he received connection with the commission of the crime.” See United States v. Awad , 598 F.3d 76, 78 Cir. 2010) (internal quotation marks omitted). Such an interpretation would untenable view of Supreme Court’s insistence legislatures have primary responsibility—subject, course, constitutional constraints—for “determining types limits punishments crimes.” , 524 at 336 (internal quotation marks omitted). [16]
It is possible, course, “that a person’s health condition” might “bear on ability make a living.” See Def. although those circuits have not distinguished such an inquiry question a forfeiture would destroy a defendant’s livelihood. See United States v. Smith F.3d 821, 828 (8th Cir. 2011) (“A defendant’s inability satisfy a time conviction, itself, not at all sufficient render unconstitutional, nor even correct inquiry.” (quoting Levesque F.3d 85) (alteration omitted)); United States v. Seher F.3d (11th Cir. 2009) (“We do not take into account impact fine on an individual defendant.”); Dubose (9th Cir. 1998) (“[A]n Amendment gross disproportionality analysis does require an inquiry into hardship sanction work on offender.”); Dicter n.11 (11th (declining impact on livelihood “we do take into account impact specific defendant”). this context, note Congress has authorized Attorney General remit forfeitures “on grounds hardship defendant.” Levesque
Reply Br. 6. Personal circumstances might thus be indirectly relevant proportionality determination, extent those circumstances, conjunction with challenged forfeiture, of his livelihood. Our holding bars only separate consideration of circumstances distinct factor.
2. Application
In light framework we described, we now consider Viloski’s unconstitutionally excessive. doing so, we are mindful Bajakajian ’s admonition “that any judicial determination regarding gravity particular criminal offense will inherently imprecise.” at 336. Therefore, although we review constitutionality de novo invalidate if it “is grossly disproportional gravity offense.” Id. at (emphasis supplied); see Blackman (4th (“[T]he test highly deferential [to legislature].”). begin with “traditional” factors. First “the essence [Viloski’s] crime . . relation other activity.” Castello (internal quotation marks omitted). essence Viloski’s crime “was no one time failure report otherwise legal activity ,” George 123. Rather, engaged multi year conspiracy involving repeated instances money laundering, mail fraud, wire fraud, related offenses. F. Supp. 3d Although insists relative lack culpability, his “willful *18 participation” in that conspiracy, even if less egregious than that codefendants, sufficient support forfeiture. Sabhnani Cir. 2010) (noting that we have upheld civil against building owner who was “willfully blind” fact building was used facilitate drug trafficking (internal quotation marks omitted)); Jalaram, Inc. (4th (“[T]hat [the defendant] have received only small share proceeds, and itself, does demonstrate played minor role conspiracy. That fact establishes [the defendant’s] participation conspiracy was lucrative . . .”).
Second consider “whether [Viloski] fits into class persons for whom statute[s] [under he punished were] principally designed.” Castello (alteration and internal quotation marks omitted). fits squarely within class persons whom federal mail ‐ and wire fraud and money ‐ laundering statutes were designed—namely, those who use facilities interstate or foreign commerce engage fraudulent schemes transactions then seek conceal disguise nature proceeds fraud.
Third “the maximum sentence fine could been imposed,” looking especially applicable Guidelines penalties. Id. (internal quotation marks omitted); cf. 338–39 & n.14 (noting maximum statutory penalties “are certainly relevant evidence” “an offense’s gravity,” looking first Guidelines). Here, Guidelines range *19 imprisonment was 135 months, and the maximum Guidelines fine was $500,000. These figures suggest substantial culpability and support conclusion that the challenged forfeiture is constitutional. We also note that statutory maximum fine was $3,250,000—more than two and ‐ ‐ half times $1,273,285.50 forfeiture—which suggests Congress did view offenses like Viloski’s trivial, thus weighs strongly favor forfeiture’s constitutionality. George F.3d at 123–24 (finding third factor “points no disproportionality,” much less gross disproportionality, even where challenged exceeded Guidelines fine, “well below” statutory maximum); Varrone (“[I]f value forfeited property within range fines prescribed by Congress, strong presumption arises constitutional.” (quoting N.E. 29th Drive, Wilton Manors, Fla. (11th 1999))).
Fourth “the nature harm caused [Viloski’s] conduct.” Castello (internal quotation marks omitted). found conspiracy Viloski participated inflicted “extensive harm” DSG “various landlords, real estate developers, investors, property owners, others involved development new DSG stores.” F. Supp. 3d no reason second guess factual finding.
Finally, address livelihood. Although bears burden showing unconstitutionality of forfeiture, see Castello F.3d at he has presented no evidence that would prevent him earning living upon his release from prison. Instead, he urges us to consider “compelling factors concerning [his] age, health and dire circumstances.” Def. Br. 8. But as we emphasize above, factors are irrelevant themselves. them insofar they, conjunction with challenged forfeiture, would deprive his livelihood. Viloski has offered no reason to think that challenged would such an effect.
Accordingly, because support conclusion is grossly disproportional gravity Viloski’s offenses, and has failed establish would deprive him his livelihood, reject *21 meritless Viloski’s Eighth Amendment challenge forfeiture order. also decline review Viloski’s remaining claims, are not properly before us.
III. CONCLUSION
To summarize, hold as follows:
(1) A punitive forfeiture violates Clause Amendment if is “grossly disproportional gravity [the defendant’s] offense.” (1998). a. determining whether “grossly disproportional,” courts not factors previously derived whether *22 deprive a defendant of his “livelihood,” i.e. his future ability earn a living.
b. Courts should defendant’s circumstances—such age, health, present condition—when making proportionality determination, except insofar they are relevant determining would deprive defendant of his livelihood.
(2) The imposed was grossly disproportional gravity offenses had been imposed.
a. failed meet his burden showing him livelihood.
b. remaining described by weigh favor forfeiture’s constitutionality. For foregoing reasons, AFFIRM Court’s order October
(1) essence crime defendant relation other activity, (2) fits into class persons whom statute principally designed, (3) maximum sentence fine could been imposed, nature harm caused conduct. George (quoting Castello 120).
[1] Because Viloski’s appeal follows conviction jury, must view evidence “in light most favorable Government.” Evans (1992); accord Weingarten 2011).
[2] jointly severally liable with Queri related two counts, jointly severally liable with Gosson related third count.
[3] The Amendment Constitution provides “Excessive bail shall required, nor excessive fines imposed, nor cruel unusual punishments inflicted.”
[4] noted “is poor health suffers from several physical ailments,” including complications double bypass surgery September cancer diagnosis F. Supp. 3d 532.
[5] Supreme Court had previously discussed Clause Browning Ferris Industries Vermont, Inc. Kelco Disposal, Inc. U.S. (1989), which held clause does apply awards punitive damages suits between private parties, Austin (1993), held clause applies rem civil proceedings. first time invalidated fine excessive under Amendment.
[6] The Government urges us apply “plain error” review Viloski’s argument about sufficiency factors, he did present below. Gov’t Br. 16–21. requirement litigants raise all possible arguments before district court serves principally “give[ ] district court opportunity consider resolve” questions first instance. See Puckett U.S. (2009). Here, considered sufficiency found made “compelling arguments” topic. F. Supp. 3d accordingly question de novo & n.10.
[7] Government argues necessarily constitutional “involves only proceeds conduct.” Gov’t Br. Revealingly, brief cites out ‐ ‐ circuit cases, half which predate . One two post cases Government cites, Betancourt & n.5 (5th Cir. 2005), distinguished based “drug proceeds” exception Clause. Betancourt analogous cases, however, essentially characterized drug proceeds as “guilty property,” rem purely remedial. id. (“The drug proceeds does constitute punishment . . . .” (alteration internal quotation marks omitted)); cf. Sum $185,336.07 Currency Seized Citizen’s Bank Account L7N01967 (“[T]he ‘guilty property,’ such illicit drug proceeds, has been traditionally regarded non punitive . . .” (some internal quotation marks
[8] Supreme often declines provide definitive tests when interpreting constitutional provisions first time. See, e.g. Columbia Heller U.S. (“[S]ince this case represents this Court’s first depth examination Second Amendment, one should expect clarify entire field . . .”); Austin 622–23 (declining adopt test an rem unconstitutionally excessive, “[p]rudence dictates allow lower courts question first instance”).
[9] See, e.g. Collins v. S.E.C. F.3d 521, 526–27 (D.C. Cir. 2013) (adopting four factor test specified Collado F.3d 328, noting “the factors derived hardly establish discrete analytic process”); Dodge Caravan Grand SE/Sport Van, VIN # 1B4GP44G2YB7884560 (8th Cir. 2004); Carpenter (6th Cir. (“While were clearly fact specific case before Court, they are instructive type analysis must undertaken assessing gravity offense.”), reh’g granted, judgment vacated (Apr. 2003), opinion reinstated relevant part reh’g, (6th 2004).
[10] As note below, our test differs somewhat First Circuit’s. note and accompanying text, post
[11] take this opportunity note there a significant difference between a district court’s role determining appropriate length a sentence and role ordering a forfeiture. In general, a sentencing court empowered by statute consider a wide range factors when determining what sentence impose. See, e.g. U.S.C. § 3553(a) (requiring court consider such “the nature circumstances offense and history and characteristics defendant”); id. § (“No limitation shall be placed information concerning background, character, conduct person convicted an offense court receive purpose imposing an appropriate sentence.”). case forfeiture, however, once court determines property sought government “involved in” “traceable to” property involved money laundering, example, court “shall” order such property forfeited. Id. § 982(a)(1). U.S.C. § 2461(c) includes similar mandatory language. As long
[14] make no pronouncement civil forfeitures. See George n.4 (noting difference between civil criminal forfeitures); von Hofe 184–86 Cir. (same).
[15] Our approach aligns most closely with First Circuit. Fogg (1st 2011). Eighth, Ninth, Eleventh Circuits held Amendment bars inquiry into circumstances when court reviews forfeiture,
[17] Viloski’s appellate brief summarizes discussions Levesque 83–85, regarding Magna Carta’s protection an offender’s livelihood, he never applies those discussions his own case. See Def. Br. 12– also failed present any facts Court—or make any argument all—regarding his livelihood. See Def. Submissions Remand, App. 173–91. Accordingly, our review “plain error” only. Ubiera (2d Cir. 2007); Messina (noting plain error review requires “showing (1) error, (2) clear or obvious, (3) affecting appellant’s substantial rights, ordinary case means affecting outcome district court proceedings, seriously affecting [the] fairness, integrity public reputation judicial proceedings”) (internal quotation marks, ellipsis, alteration omitted)). Nonetheless, has adduced no facts all suggesting him livelihood, would come same conclusion even under de novo review.
[18] seeks “preserv[e]” several “issues not before present panel”: (1) not authorized by statute, because (a) money issue “was not possessed by . . . proceeds crime,” (b) “proceeds mail fraud not affecting institution are not criminally forfeitable,” (c) “no applicable statute authorizes ‘money judgment’ forfeiture,” or (d) no statute authorizes “‘joint several forfeiture’”; and joint several liability “violated Fifth Sixth Amendments indictment did name property forfeitable.” Def. Br. Because concedes issues “are open decision this time, . . are precluded . . . controlling precedent,” id . there no need address them here.
[19] These are