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April 15, 2014

Circuit Clarifies 'Presumptive Floor' for CP Victim Restitution

LOS ANGELES—A three-judge panel of the U.S. Court of Appeals for the Sixth Circuit handed down a ruling yesterday that reversed a $1 million award granted by a district court to the victim of a man who had pled guilty to one count of producing child pornography. In reversing and remanding the case back to the lower court, the ruling also clarifies the presumptive floor courts should use to assess monetary damages paid to victims of child pornography. Unfortunately for the victims, however, in lieu of actual damages being proved at court, the panel interpreted the guiding statute as allowing a presumed damages floor of $150,000 per conviction only. The lower court, adopting the plaintiff's theory of recovery, instead handed down a far greater fine. According to the ruling, the lower court "concluded that [defendant/appellant Stanley] Weems violated the criminal production statute seven times—one violation for each video found on his cellular telephone—multiplied the $150,000 presumed-damages floor in the statute by seven, and reduced the total ($1,050,000) to reflect the $1 million award requested in [plaintiff] J.W.’s complaint." However, according to the panel, the court misinterpreted the statute, 18 U.S.C. §2255(a), which states that "the victim may recover either actual damages or presumed damages in an amount 'no less than $150,000 in value.'" The questions before the court was multifaceted. It needed to assess whether the lower court was correct in ruling that "violations [of the statute] do not require convictions," and also, even if it decided that violations do not require convictions, whether that fact entitles a victim of child sexual abuse to seven $150,000 presumed-damages awards or just one such award? Put another way, does §2255 authorize presumptive damage awards of $150,000 per violation or $150,000 per lawsuit?" The language of the statute, they determined, indicates the latter. The statute reads in full: a) In General.—Any person who, while a minor, was a victim of a violation of section 1589, 1590, 1591, 2241(c), 2242, 2243, 2251, 2251A, 2252, 2252A, 2260, 2421, 2422, or 2423 of this title and who suffers personal injury as a result of such violation, regardless of whether the injury occurred while such person was a minor, may sue in any appropriate United States District Court and shall recover the actual damages such person sustains and the cost of the suit, including a reasonable attorney’s fee. Any person as described in the preceding sentence shall be deemed to have sustained damages of no less than $150,000 in value. b) Statute of Limitations.—Any action commenced under this section shall be barred unless the complaint is filed within 10 years after the right of action first accrues or in the case of a person under a legal disability, not later than three years after the disability. The ruling, written by Circuit Judge Jeffrey Sutton, explains, "Section 2255(a)’s two sentences contain two basic thoughts when it comes to this issue. After describing the violations of the relevant statutes that may cause a “personal injury,” the first sentence gives the victim a right of action to “recover the actual damages” caused by the violations. The second sentence gives the victim the option of presumed damages, saying that the victim “shall be deemed to have sustained damages of no less than $150,000.” Missing from the second sentence is any indication that the $150,000 threshold applies on a per-violation basis. That omission is noteworthy because, when the statute was first enacted in 1986, claimants generally were not permitted to “split a cause of action and bring separate suits upon its parts. "The same remains true today," he added. Had the plaintiff provided factual evidence in court that actual damages had occurred as a result of the seven videos Weems made of him as a minor depicting him having sex with various prostitutes in Weems' home, the appeals court would have accepted fines of over $150,000, but according to the ruling, "He never attempted to prove the extent of his actual damages. He instead relied on the presumptive damages created by the statute ($150,000) and requested that the district court multiply the damages floor by the number of times Weems violated the criminal statute." Having decided that such a justification was not supported by the statute, the lower court judgment was "reversed and remanded," with a final opportunity offered the plaintiff. "On remand," it said, "the district court may decide whether J.W. has forfeited any argument that his actual damages exceed $150,000 and, if he has not, whether to allow the parties the opportunity to offer proof of J.W.’s actual damages." What may throw a monkey wrench into the Sixth Circuit's ruling, however, is the similar case of Doyle Randall Paroline, who pled guilty to a companion satute, 18 U.S.C. §2259, for having downloaded child pornography from the internet. The judge in that case rejected the petition from one of Paroline's "victims" to assess in excess of $3 million—and in response to a Fifth Circuit panel's remand, apparently seeking to have the trial court award a higher damage amount, Paroline petitioned the U.S. Supreme Court to interpret the statute's language on the damages clause. That case was argued in January, with a ruling expected sometime in June. The Sixth Circuit ruling can be read here.

 
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