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United States Court of Appeals for the Ninth Circuit
February 22, 2007, Filed
[*1043] BERZON, Circuit Judge:
We are asked to determine whether -- and if so, under what circumstances -- a criminal defendant's retirement benefits are available as a source of funds to compensate crime victims. Answering these questions requires reconciling two federal statutory schemes -- one, the Mandatory Victims Restitution Act of 1996 ("MVRA"), Pub. L. No. 104-132, 110 Stat. 1227, governing the payment of restitution to [**2] crime victims, and the other, the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1461, 1 regulating private pension plans. Underlying each statute is a weighty policy determination: MVRA rests on the recognition that "[i]t is essential that the criminal justice system recognize the impact that crime has on the victim, and, to the extent possible, ensure that [the] offender be held accountable to repay these costs." S. Rep. No. 104-179, at 18 (1995). ERISA is meant to assure that "[r]etirement funds shall remain inviolate until retirement." Boggs v. Boggs, 520 U.S. 833, 851, 117 S. Ct. 1754, 138 L. Ed. 2d 45 (1997) (quoting JOHN H. LANGBEIN & BRUCE A. WOLK, PENSION AND EMPLOYEE BENEFIT LAW 547 (2d ed. 1995)) (internal quotation mark omitted). Taking a close look at the statutory implementation of these two important policies, we conclude that criminal restitution orders can be enforced by garnishing retirement funds, but with the funds only payable when the defendant has a current, unilateral right to receive payments under the terms of the retirement plan.
From 1995 to 1999, Raymond Novak and his former wife, Norma Ortega Nance, engaged in a scheme to steal telephone equipment from the Nestle Food Company, resell the equipment, and pocket the proceeds. Nance, a Nestle employee, had access to the equipment, which she then passed along to Novak to sell. The scheme cost Nestle over $ 3.3 million. Unsurprisingly, Novak did not report the earnings from this illicit trade on his federal tax returns.
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476 F.3d 1041 *; 2007 U.S. App. LEXIS 3804 **; 99 A.F.T.R.2d (RIA) 2007-1385; 39 Employee Benefits Cas. (BNA) 2825
UNITED STATES OF AMERICA, Plaintiff-Appellant, v. RAYMOND P. NOVAK, Defendant-Appellee.
Subsequent History: As Amended February 23, 2007.
Prior History: [**1] Appeal from the United States District Court for the Central District of California. D.C. No. CV-03-06706-CBM. Consuelo B. Marshall, Chief District Judge, Presiding.
United States v. Novak, 441 F.3d 819, 2006 U.S. App. LEXIS 7196 (9th Cir. Cal., 2006)
Disposition: The court vacated the district court's order, and remanded for further proceedings.
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Criminal Law & Procedure, Sentencing, Restitution, Governments, Legislation, Interpretation, Pensions & Benefits Law, ERISA, Criminal Charges & Defenses, General Overview, Expiration, Repeal & Suspension