On Appeal from the United States District Court for the Western District of Pennsylvania (D.C. Criminal No. 91-cr-00026E)
Before: SLOVITER, Chief Judge, and ALITO, Circuit Judge, and RENDELL, District Judge *fn*
Argued September 11, 1995
This case is before us on the appeal of defendant John R. Copple from that portion of the district court's judgment of sentence ordering restitution in the amount of $4,257,940.45. In an earlier appeal in the same case, we vacated the judgment of sentence and remanded for resentencing. We directed the district court, inter alia, to make findings about Copple's ability to pay restitution. Following a hearing, the court reimposed the same amount of restitution. We conclude that Copple's argument that the restitution order is unreasonable and clearly excessive in light of the record developed at the resentencing hearing is well-taken.
The facts are fully set forth in our prior opinion, United States v. Copple, 24 F.3d 535 (3d Cir.) (Copple I), cert. denied, 115 S. Ct. 488 (1994), and we therefore repeat only so far as is necessary in the context of this appeal. Copple, who was convicted on multiple counts of mail fraud and income tax evasion, had defrauded funeral directors of funds which he had promised to channel into low-risk/high-return investments. Copple and his investment firm obtained $12 million from the pre-paid funeral plans of a large number of funeral directors, but instead of investing the money as promised Copple used it to increase his personal assets and live extravagantly. Copple's firm filed for bankruptcy.
The bankruptcy trustee, who discovered Copple's misappropriation, was able to recoup only a limited amount of these assets, primarily several accounts and deposits totaling $389,356.51 and coins from Copple's rare coin collection that were later auctioned off for $209,045. The loss to the victims of Copple's swindle was $4,257,940.45. See Copple I, 24 F.3d at 538-40.
A jury convicted Copple on 34 counts of mail fraud and 3 counts of income tax evasion. Copple was sentenced to 71 months imprisonment, a $100,000 fine, a special assessment of $1850 and three years supervised release. The district court accepted the findings in the presentence report concerning money due victims, and ordered Copple to pay restitution of $4,257,940.45.
Copple appealed, challenging both his conviction and sentence. This court affirmed the conviction, but vacated the sentence because the district court impermissibly based an upward departure on the large number of victims and the amount of monetary loss involved.
More relevant for our purposes here is our discussion of the restitution portion of the district court's judgment. We emphasized our cases instructing that restitution orders be grounded on specific factual findings regarding the defendant's economic circumstances and other relevant financial information. We noted that the district court had failed to make any such findings to support its restitution order of $4,257,940.45, and "therefore remand[ed] for the district court to make the factual findings necessary to support such order of restitution as it may make." Id. at 549-50.
On remand, the district court conducted a resentencing hearing. Mary Copple, Copple's wife and the caretaker for their two minor children - Jennifer, 18 years old and John, 16 years old, testified that she could not work or even complete basic daily tasks because of chronic mental illness, that she required and had been receiving psychiatric treatment for three years, and that her husband and her daughter also suffered from mental illness and were under physicians' care. App. at 53-66. She stated that her only steady income was $403 in monthly welfare payments and $292 in monthly food stamps, and that the occasional commission checks she had received from her husband's insurance policy renewals totaled $300. She testified that her home was subject to foreclosure after her failure to pay mortgage payments for 15 months, that any remaining equity was subject to levy by the bankruptcy trustee, that the home's electricity and gas utilities had been discontinued for her inability to pay bills, and that her only other assets were $400 in a bank account, some furniture, and a 1987 Cadillac. Id. at 58-70.
Jennifer Copple, Copple's eighteen-year old daughter, testified that she suffered from manic depression, was on medication and had been undergoing regular therapy, and as a result could attend school only part-time. Id. at ...