Lyndonville Savings Bank & Trust Co. v. Lussier
211 F.3d 697, 2000 WL 530328 (2000)
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Rule of Law:
The Victim and Witness Protection Act (VWPA), 18 U.S.C. § 3663(h)(2), allows a victim to use civil enforcement mechanisms to collect on a criminal restitution order, but it does not create an independent federal civil cause of action to modify that order or obtain a new civil judgment.
Facts:
- Between 1988 and 1993, Roger Lussier served as the president and chairman of the board for Lyndonville Savings Bank and Trust Co.
- Lussier used his wholly-owned corporation, Applied Research and Development, Inc., as a shell corporation to facilitate breaches of his fiduciary duty to the bank.
- He used his control over the bank to finance a variety of his friends' and business associates' imprudent and ultimately disastrous investments.
- Lussier's actions resulted in significant financial harm to Lyndonville.
- Following a criminal conviction for these actions, a court ordered Lussier to pay restitution to Lyndonville in installments of at least 10 percent of his gross monthly income.
Procedural Posture:
- Roger Lussier was convicted on 17 counts of bank fraud and other charges in the U.S. District Court for the District of Vermont.
- As part of his sentence, the district court ordered him to pay $426,204.67 in restitution to Lyndonville Savings Bank in installments.
- The U.S. Court of Appeals for the Second Circuit affirmed the conviction and sentence.
- Lyndonville Savings Bank then filed a separate civil suit against Lussier and his corporation in the U.S. District Court for the District of Vermont, seeking immediate payment of the full restitution amount and asserting several state-law claims.
- During the civil proceedings, the district court (in the separate criminal case) eliminated the restitution order entirely based on a § 2255 motion by Lussier.
- The district court in the civil case awarded Lyndonville over $8.7 million on its state law claims, exercising supplemental jurisdiction based on the now-defunct federal restitution claim.
- Lussier moved to dismiss the civil judgment for lack of subject matter jurisdiction, which the district court denied.
- Lussier, as appellant, appealed the judgment and the denial of his motion to the U.S. Court of Appeals for the Second Circuit; Lyndonville is the appellee.
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Issue:
Does the Victim and Witness Protection Act, which permits a criminal restitution order to be enforced 'in the same manner as a judgment in a civil action,' create an independent federal civil cause of action allowing a victim to sue to modify the terms of that order?
Opinions:
Majority - Cardamone
No, the Victim and Witness Protection Act does not create an independent federal civil cause of action to modify a criminal restitution order. The statute's language and purpose indicate that Congress intended restitution to be an element of the criminal sentencing process, not a separate civil action. The provision allowing enforcement 'in the same manner as a judgment in a civil action' merely provides a civil mechanism for collecting the amount determined in the criminal proceeding; it does not transform the criminal order into a civil one or grant federal courts jurisdiction to hear a new civil suit to alter its terms. This interpretation is supported by the need to avoid Seventh Amendment jury trial concerns and is consistent with the long history of restitution as a penal, rather than civil, remedy. Because the bank's federal claim fails, there is no common nucleus of operative fact with its state law claims, and the district court therefore lacked supplemental jurisdiction to hear them.
Analysis:
This decision solidifies the distinction between the adjudication of a criminal restitution order and its subsequent enforcement. It establishes that the VWPA does not provide a backdoor for victims to create federal question jurisdiction for a new civil suit aimed at modifying a criminal sentence. By denying the existence of a federal cause of action, the court prevents victims from using the Act to circumvent the payment terms set by the sentencing judge. This holding forces victims to either rely on the enforcement mechanisms provided or pursue separate, independent civil claims based on state law, provided an independent basis for jurisdiction exists.
