LARRY D. BARNETTE, ET AL., PETITIONERS V. UNITED STATES OF AMERICA

   No. 88-121

   In the Supreme Court of the United States

   October Term, 1988

   On Petition for a Writ of Certiorari to the United States Court of
Appeals for the Eleventh Circuit

   Brief for the United States in Opposition

            TABLE OF CONTENTS
   Question Presented
   Opinions below
   Jurisdiction
   Statement
   Argument
   Conclusion

                            OPINIONS BELOW

   The district court orders of December 13, 1984 (App., infra, 1a-4a,
5a-6a), granting petitioners' stays pending appeal and ordering the
posting by each petitioner of the amounts of court-ordered restitution
and fines, and of March 11, 1987 (App., infra, 7a-9a), disbursing to
the United States the amounts of restitution and fines deposited with
the court, and the interest thereon, and the opinion of the court of
appeals (Pet. App. 1a-9a), are all unreported.

                             JURISDICTION

   The judgment of the court of appeals was entered on May 5, 1988.  A
petition for rehearing was denied on May 31, 1988 (Pet. App. 10a-11a).
 The petition for a writ of certiorari was filed on July 20, 1988.
The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1).

                          QUESTION PRESENTED

   Whether, where petitioners complied with the district court's
requirement that they deposit with the court, pending appeal, the full
amount of court-ordered restitution and fines awarded to the United
States, it was proper to award to the United States interest on the
money deposited commencing with the date originally set by the
district court for payment of the restitution and fines.

                               STATEMENT

   Following a jury trial in the United States District Court for the
Middle District of Florida, petitioners were convicted of a variety of
offenses arising from their fraudulent government contracting
practices (Pet. App. 2a).  Petitioner Barnette was sentenced to a
total of five years' imprisonment and ordered to pay $7 million in
restitution to the government (Pet. App. 3a).  Petitioner Allied
Management Corporation was fined $71,000, and petitioner Jets Venture
Capital Corporation was fined $2,000 (ibid.).

   1. The judgment and commitment order as to petitioner Barnette
specified that the restitution was to be paid within the first year of
Barnette's confinement, and Barnette's surrender date was set for
January 10, 1985 (Pet. App. 3a).  The judgment and commitment orders
as to petitioners Allied Management Corporation and Jets Venture
Capital Corporation specified that the corporate fines were to be paid
within 90 days of the date of judgment (ibid.).  Petitioners
thereafter filed motions to stay the judgment pending appeal, which
were granted by the district court on December 13, 1984 (App., infra,
1a-4a, 5a-6a).  The motion as to petitioner Barnette was granted upon
the condition that Barnette "post() by January 10, 1985, either the
ordered restitution in the amount of $7 million with the Clerk of the
Court, to be placed in an interest bearing account during the pendency
of the appeal, or a bond in an equivalent amount * * *" (App., infra,
4a).  The stay order further provided that any interest accruing on
the deposited funds was to remain in the registry of the court
(ibid.).  As to petitioners Allied Management Corporation and Jets
Venture Capital Corporation, the court granted the stay upon the
condition that petitioners "post with the Clerk of the Court a
certificate of deposit as collateral for the payment of the fines"
(App., infra, 5a-6a).  Again, the order specifically provided that any
interest accruing on the funds should remain in the registry of the
court (id. at 6a).  On January 10, 1985, petitioners posted the full
amount of the restitution and fines with the clerk of the court in the
form of one-year certificates of deposit (Pet. App. 3a-4a).

   Petitioners' appeal was still pending when the certificates of
deposit matured in January 1986, and petitioners moved for renewal of
the certificates and return of accrued interest (Pet. App. 4a).  The
district court ordered the clerk to renew the certificates of deposit,
but deferred ruling on petitioners' request for the interest pending
resolution of the appeal (ibid.).

   On October 8, 1986, the court of appeals affirmed petitioners'
convictions and sentences (with the exception of one sentence on one
count) (Pet. App. 4a).  See United States v. Barnette, 800 F.2d 1558
(11th Cir. 1986), cert. denied, 480 U.S. 935 (1987).  Petitioner
Barnette commenced serving his term of imprisonment on December 4,
1986 (Pet. App. 4a).  The government moved for disbursement of the
funds in the court registry (ibid.).  On March 11, 1987, the district
court ordered that the funds and all accrued interest be disbursed to
the government (App., infra, 7a-9a).  In its order the court stated:
"When staying the Judgments to allow (petitioners) to appeal, it was
the intention of the Court to require (petitioners) to pay the
restitution and fines imposed.  While these sums were retained in the
Registry of the Court pending appeal, it was not the Court's intention
to return interest accumulated on these funds if the Judgments were
affirmed" (id. at 8a).  The court subsequently stayed its disbursement
order pending appeal (Pet. App. 5a).

   2. The court of appeals vacated the order of the district court and
remanded for further proceedings (Pet. App. 1a-9a).  The court held
that petitioner Barnette was entitled to the interest that had accrued
on the funds prior to January 10, 1986 (Pet. App. 7a).  The court
reasoned that if Barnette had not pursued an appeal, his restitution
payment would have come due on that date, one year after he would have
commenced his term of imprisonment had there been no appeal and stay.
Awarding the interest earned on the $7 million during that year would
thus have constituted "an impermissible burden on Barnett's right to
appeal" (ibid.).  The court held, however, that the government was
entitled to any interest earned on the funds after January 10, 1986
(Pet. App. 7a-8a).  The court explained that awarding the government
interest accruing after that date "simply gives the Government what it
would have had were there no appeal and had the money been paid when
due," and that it "furthers the trial court's expressed intention that
the appeal should not delay payment of the ordered restitution" (id.
at 8a).

   As to the corporate petitioners, Allied Management Corporation and
Jets Venture Capital Corporation, the court found that their fines
were to be paid within 90 days of the date of judgment, or by February
2, 1985 (Pet. App. 8a-9a).  Accordingly, they were entitled to
interest accruing on their bonds between January 10, 1985 and February
2, 1985;  the balance of the accrued interest was to be paid to the
government (id. at 9a).

                               ARGUMENT

   The decision of the court of appeals is correct and does not
conflict with any decision of this Court or any other court of
appeals.  Accordingly, certiorari should be denied.

   Petitioners make a two-part challenge to the order of the district
court, as modified by the appeals court, awarding the government
interest that accrued on the funds after the original due dates of the
fines and restitution.  First, they argue (Pet. 8-12) that the
district court had no authority to award interest on the sum of money
deposited in the district court registry pending appeal to secure the
payment of court-ordered restitution and fines.  Second, they argue
(Pet. 12-16) that the order awarding interest to the United States
violated the Double Jeopardy Clause because it increased their
sentences following an affirmance on appeal of their convictions.
Neither of these claims has merit.

   1. The Victim and Witness Protection Act of 1982 authorizes a
sentencing court to impose an order of restitution "in addition to or
* * * in lieu of any other penalty authorized by law" (18 U.S.C.
(Supp. IV) 3663(a) (previously, 18 U.S.C. 3579(a)(1))).  /1/ The Act
gives the sentencing court broad discretion to determine the timing of
payment of restitution (18 U.S.C. (Supp. IV) 3663(f) (18 U.S.C.
3579(f))).  The Act provides that the court may require that
restitution be made "within a specified period or in specified
installments" (Section 3663(f)(1) (Section 3579(f)(1))) or, if not
otherwise provided by the court, that restitution shall be made
immediately (Section 3663(f)(3) (Section 3579(f)(3))).  The broad
authority granted the court under the Act is consistent with the well
accepted principle that a trial court has wide discretion in setting
criminal sentences.  See Solem v. Helm, 463 U.S. 277, 290 (1983).

   The district court is given similarly broad discretion in
determining whether, and under what conditions, to grant a stay of
execution of sentence pending appeal.  Thus, Fed. R. Crim. P. 38(e)
provides:

         A sanction imposed as part of the sentence pursuant to (18
      U.S.C. (Supp. IV) 3663 (3579)) may, if an appeal of the
      conviction or sentence is taken, be stayed by the district court
      or by the court of appeals upon such terms as the court finds
      appropriate.  The court may issue such orders as may be
      reasonably necessary to ensure compliance with the sanction upon
      disposition of the appeal, including the entering of a
      restraining order or an injunction or requiring a deposit in
      whole or in part of the monetary amount involved into the
      registry of the district court or execution of a performance
      bond.

   Similarly, Fed. R. Crim. P. 38(c) grants a district court
discretion to stay a sentence to pay a fine, pending appeal, "upon
such terms as the court deems proper." Here, the district court's
orders granting petitioners' motions for stay of execution pending
appeal were conditioned on the requirement that any interest accruing
on the deposited funds was to remain in the registry of the Court
(App., infra, 4a, 6a).  Indeed, in ordering the disbursement of the
interest that had accrued on the $7 million posted by petitioner
Barnette, the district court unequivocally stated that, at the time it
stayed the judgments to allow petitioners to appeal, it was the
intention of the court to require petitioners to pay the court-ordered
amounts and, if the judgments were affirmed, not to return the
interest accumulated on these funds (App., infra, 8a).  The court of
appeals modified the condition that interest be retained by returning
a portion to petitioners so as not to burden petitioners' right to
take an appeal.  The district court's authority to determine the
conditions of stay, as so modified, was fairly encompassed by Rule
38(e), which authorizes a district court to condition a stay pending
appeal "upon such terms as the court finds appropriate."

   2. As the court of appeals recognized (Pet. App. 6a), a trial court
cannot penalize a defendant for pursuing an appeal from his
conviction.  North Carolina v. Pearce, 395 U.S. 711, 723-724 (1969).
Contrary to petitioners' assertion (Pet. 13-16), the result reached by
the court of appeals did not penalize petitioners for pursuing an
appeal by increasing their sentences because petitioners incurred no
increase in their sentences following affirmance of their convictions.
 Under the terms of his sentence, petitioner Barnette's restitution
payment would have been due January 10, 1986 -- one year after he
would have commenced his term of imprisonment had there been no appeal
and stay.  Similarly, under the terms of their sentences, petitioners
Allied Management Corporation and Jets Venture Capital Corporation
were to pay their fines by February 2, 1985.  Accordingly, the award
to the government of interest accruing after those dates "simply
(gave) the Government what it would have had were there no appeal and
had the money been paid when due" (Pet. App. 8a), and thus did not
constitute an improper increase of sentence.  /2/

   3. Petitioners contend (Pet. 11) that the decision of the court of
appeals conflicts with United States v. Jacob Schmidt Brewing Co., 254
F. 714 (D.N.D. 1918).  There, the defendant was convicted of a liquor
offense and sentenced to a $7,250 fine.  The defendant took an appeal
from the judgment and posted a stay bond.  His conviction was
ultimately affirmed.  The issue before the court of appeals was
whether the government was entitled to interest upon the judgment from
the date it was entered to the time of its payment following
affirmance of defendant's conviction.  Because there was no statute
providing for interest on judgments in criminal cases as there was for
interest on judgments in civil cases, the court held that the
government was not entitled to interest upon the judgment.

   The holding in Jacob Schmidt Brewing plainly does not govern the
instant case.  In that 1918 decision, no time for the payment of the
fine was set forth by the district court.  Here, the original terms of
the district court's sentences set a definite time for payment of
restitution and fines.  In ordering the posting of the full amount of
the restitution and fines, the district court intended that such
posting would itself constitute the actual transfer of those funds
with nothing to be returned to petitioners unless the district court
judgment was reversed (App., infra, 8a).  Although the court of
appeals correctly vacated that aspect of the district court's order
that penalized petitioners for their decision to take an appeal, its
decision to give sway to the district court's intention that the
restitution and fines be treated as a completed transfer (with
subsequent interest going to the United States as early as legally
permissible) was proper and consistent with Jacob Schmidt Brewing.
Since there is no reason to doubt that the district court had
discretion to deny a stay of execution with regard to the order of
restitution (18 U.S.C. (Supp. IV) 3663(f) (18 U.S.C. 3579(f));  Fed.
R. Crim. P. 38(e)), and the fines (Fed. R. Crim. P. 38(c)), the court
certainly had the power to require their payment on the schedule that
would have governed had no appeal been taken.

                              CONCLUSION

   The petition for a writ of certiorari should be denied.

   Respectfully submitted.

   CHARLES FRIED

      Solicitor General

   EDWARD S.G. DENNIS, JR.

      Acting Assistant Attorney General

   DEBORAH WATSON

      Attorney

   SEPTEMBER 1988

   /1/ This provision has recently been renumbered.  The certiorari
petition cites the previous United States Code designations of the
sections of this provision, which are hereinafter provided in brackets
following the current Code citations.

   /2/ The Fifth Circuit's decision in Barnes v. United States, 223
F.2d 891 (1955), cited by petitioners (Pet. 13), fails to support
petitioners' argument that the district court penalized petitioners'
decision to appeal.  In Barnes, the district court order required as a
condition of stay pending appeal that the defendant pay court costs if
the conviction were affirmed.  The appeals court vacated the order on
review because the district court lacked power to condition a stay
bond "upon an increase of the sentence in the event of an affirmance"
(223 F.2d at 893).

   Unlike in Barnes, the condition the district court below imposed on
the stay pending appeal did not increase petitioners' sentences.  The
sum in the amount of court costs would have been retained by the
defendant in Barnes had he not appealed.  In contrast, if petitioners
in the instant case had not appealed, they would not have been
entitled to the interest accruing after the due date of their fines
and restitution;  the government would have retained that money.
Thus, unlike the defendant in Barnes, petitioners incurred no
additional liability by choosing to exercise their right to appeal
because their penalty after affirmance on appeal was no greater than
that imposed in the first instance.

   APPENDIX