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The National Basketball Association can be considered a victim for purposes of restitution in a gambling scandal involving one of its referees, the 2nd U.S. Circuit Court of Appeals has ruled.
James Battista, who conspired with referee Timothy Donaghy to get information on games for betting purposes, claimed he should not be liable for restitution because the league could not be considered a victim under the Victim and Witness Protection Act of 1982.
But the 2nd Circuit said the NBA was "'directly and proximately harmed' by Battista committing the crime of conspiracy to transmit wagering information" and that restitution was properly imposed under the act in United States v. Battista, 08-3750-cr.
Donaghy had worked as an NBA referee for more than 12 years when in December 2006 he began feeding "picks" on games to Battista and co-conspirator Thomas Martino.
In return for cash payments, Donaghy transmitted which officiating teams were working games, the physical condition of players and other potentially game-altering information to Battista and Martino.
All three men pleaded guilty and as part of their sentences were ordered by Eastern District of New York Judge Carol B. Amon to pay a total of $217,266 in restitution. Battista was sentenced to serve 15 months in prison.
Only Battista challenged his restitution order on appeal, which was heard by Judges John M. Walker Jr., Richard C. Wesley and, sitting by designation, Judge J. Clifford Wallace of the 9th U.S. Circuit Court of Appeals. Judge Wesley wrote for the court.
Battista claimed the NBA was not a "victim" within the meaning of the Victim and Witness and Protection Act, 18 U.S.C. §3663A, or the Mandatory Victims Restitution Act of 1996, 18 U.S.C. §3663.
Saying his crime of conviction was not covered by either statute, Battista, 43, also argued that Judge Amon was wrong to order him to pay attorney's fees and investigative costs incurred by the NBA. Finally, he said his financial obligations were so burdensome he should be exempt from paying restitution under the Victim and Witness and Protection Act.
In reviewing Judge Amon's restitution order, Judge Wesley said the difference between the witness protection law and the victim restitution law is that the latter requires mandatory restitution and the former is discretionary.
The court upheld Judge Amon's restitution order only under the Victim and Witness and Protection Act.
"We need not reach the question of whether the district court properly ordered Battista to pay restitution under the [Mandatory Victim Restitution Act] -- which would require us to answer the open question of whether the language 'committed by fraud or deceit' in §366A(c)(1)(A)(ii) refers to the elements of an offense or the manner in which the defendant commits the offense -- because we hold that restitution was properly imposed pursuant to" the Victim and Witness and Protection Act, Judge Wesley said.
He then explained why the NBA met the definition of "victim" within the act.
"Although Battista did not defraud the NBA directly, we conclude that the district court properly characterized the NBA as a 'victim' under the [Victim and Witness Protection Act] because the NBA was harmed by the conduct committed during the course of the conspiracy to transmit wagering information, e.g., Battista's use of nonpublic information solely belonging to the NBA (conveyed to him by the co-conspirators) to place illegal wagers on its games," he said.
The court rejected Battista's argument that his financial obligations were too burdensome, saying limited resources are not dispositive of whether restitution is proper.
On attorney's fees, the court said its holding in the mandatory restitution case of United States v. Amato, 540 F.3d 153 (2008), which allowed the cost of attorney's fees to be factored into a restitution order, also applied in the discretionary context of the Victim and Witness and Protection Act.
"Here, the NBA incurred substantial attorneys' fees as a direct result of Battista's criminal acts," Judge Wesley said.
Jack McMahon of Philadelphia represented Battista.
Assistant U.S. Attorneys Jeffrey Goldberg, Jo Ann M. Navickas and Alexander A. Solomon represented the government.
