MEMORANDUM OPINION AND ORDER I. INTRODUCTION On August 16, 2021, a jury convicted Medghyne Calonge of two crimes. Both crimes involved the deletion of files maintained in a computer system used by her employer, 1-800-Accountant (the “Company”). The Company now seeks over $490,000 in restitution under the Mandatory Victims Restitution Act of 1996 (the “MVRA”), 18 U.S.C. §3663A. This amount, the Company claims, represents the value of the computer system that Ms. Calonge damaged, the costs incurred to restore it, and attorneys’ fees that it allegedly incurred by participating in the Government’s investigation into and prosecution of Ms. Calonge. Because the Court concludes that the Company has not sufficiently proven that the amount that it claims represents the “value” of the destroyed property, or that the legal fees that the Company has claimed are compensable under the MVRA, the Court grants the application in part and denies it in part. II. BACKGROUND In October of 2020, the Government charged Ms. Calonge in a two count indictment. Dkt. No. 2 (the “Indictment”). The Indictment alleged that Ms. Calonge intentionally damaged computers in violation of 18 U.S.C. §1030(a)(5)(A), 1030(c)(4)(B)(i), and 2, and that she had recklessly damaged computers in violation of 18 U.S.C. §1030(a)(5)(B), 1030(c)(4)(B)(i) (I), and 2. The facts alleged in the Indictment in support of the charges were straightforward. Ms. Calonge was alleged to have been terminated from her employment on July 28, 2019. “Following her termination and continuing until on or about June 29, 2019, CALONGE misused administrative access provided to her as an employee of the Company to log in to the Applicant Tracking System and damage the integrity of the Company’s computer systems by deleting the Company’s records, including job postings created by the Company to advertise employment opportunities at the Company and thousands of applications for employment at the Company submitted to the Company via the Applicant Tracking System.” Indictment 3. The case was tried to a jury in August 2021. At trial, the Government proved the allegations outlined in the Indictment. Ms. Calonge worked as a senior manager in the Company’s human resources department. In that role, she had access to the programs used by the Company to manage its HR functions. Those systems included JazzHR, a database system used by the Company to track job applicants. The Company selected JazzHR from among a group of software providers in May 2017 to manage its recruitment process. The Company paid JazzHR a flat fee to use its system. Ms. Calonge had administrator access to the JazzHR system. After her termination, the Government proved at trial, Ms. Calonge deleted a substantial amount of information from the JazzHR system. According to the defendant, the log of deletions shows 17,780 deletions using Ms. Calonge’s user identification in the days following her termination, largely, it appears, deletion of applicant resumes. After the deletions were discovered, the Company took a number of steps to recover the data that had been deleted and to be able to use the JazzHR system for future hires. By July 1, new data was being added by the Company to the JazzHR database, including new resumes. JazzHR continued to work with the Company to fix the database. On July 23, 2019, JazzHR communicated to the Company that it had imported all “historical jobs” into the database. The Court sentenced Ms. Calonge on December 16, 2021. At sentencing, the Court deferred a determination regarding the amount of restitution owed to the Company. The Court did so because among other things the “victim has presented a letter requesting certain amount of restitution without affidavits or legal arguments tailored to the requirements of the MVRA.” Dkt. No. 101 (“Sentencing Tr.”), at 42:14-17. “Again, in the victim statement that I received from the victim, the victim asserts that the measurable cost to repair Ms. Calonge’s criminal conduct totaled $497,340, but I don’t have a breakdown or affidavit supporting that amount. It may be that some of that amount is not properly compensable under the MVRA.” Id. at 42:19-24. The Court commented further on the sufficiency of the information provided to the Court in connection with the Company’s request before scheduling further briefing. Again, I’ve reviewed the December 1, 2021…letter submitted by the victim. The letter does not attach what I’ll describe as facts…[T]here are no affidavits, no billing records and the like. It’s not clear to me that the application is written with the requirements of the MVRA in mind. In other words, it’s not clear to me that the restitution request submitted by the victim has considered the provisions of the MVRA, and that it has provided me with a view of the appropriate amount of restitution, based on the governing law. As I suggested during our conversation earlier with respect to the loss amount, I need more information, I believe, with respect to the legal costs that are requested for reimbursement here. Here, the sum requested by the victim includes $121,043 in legal costs which are described as the legal costs “from first contact with the government through to the preparation of this victim impact statement.” But, as you analyze the MVRA and the recent Supreme Court precedent, you’ll see the MVRA only covers compensation for such expenses in connection with the government investigation or criminal proceedings. Costs associated with investigations tak[en] independently, apart from the government, are not as I understand it compensable. So I do not have enough information from the materials submitted in the victim’s letter to me to determine which legal costs are properly compensable under the legal framework established under the MVRA. So what I’m going to do is to ask for written submissions regarding the application for the determination of the reimbursement amount requested as restitution. I’d ask that that be presented in the form of a motion with supporting affidavits presenting the facts that you want the Court to consider in determining the appropriate amount of restitution. Sentencing Tr. at 44:14-45:21. Having provided the Government and the Company with this clear statement regarding the limitations of the Company’s initial submission, the Court provided an opportunity for the Company to provide supplemental briefing and affidavits with respect to its application. The Company submitted its supplemental submission in support of its restitution application on January 18, 2022 (the “Application”). Dkt. No. 94. The Application was three single spaced pages long and was supported by a single short affidavit by Erin Galliher, the Company’s counsel (the “Galliher Decl.”). Dkt. No. 95. The Galliher declaration contained only facts about counsel’s legal fees. No affidavits or factual support was provided to the Court regarding any other aspect of the Company’s request. And the Application did not point to other evidentiary support for the requested award, such as by referring the Court to relevant provisions of the trial testimony or exhibits that might provide the foundation for the Court’s evaluation of the request. In the Application, the Company requested reimbursement of several categories of asserted losses under the MVRA. First, the Company claims all of the costs incurred in building and developing the database — amounting to nearly $300,000. The Application describes that amount as consisting of “$140,000 in employee hours, $8,034 in fees to the company that owned the database, and $143,642 in advertising jobs that synced to the system.” Application at 2. The Company asserts that “amount represents the value of the system at the time it was rendered useless as a result of Ms. Calonge’s destruction, and is properly compensable under the MVRA.” Id. However, the Company provides no information regarding why the value of the system should be measured as the sum of the costs of creating and operating it during the years prior to Ms. Calonge’s criminal act. Second, the Company claims $81,271, which is the amount that it asserts the Company was forced to spend “to return the system to a state of operability.” Id. “These further expenditures included $14,8271 paid to Operations, Inc., a third-party acquisition firm that the Company used to assist it with hiring while the database was down; $29,658 in advertising expenses; $1,986 in fees to the provider of the database; and $34,800 in employee time spent rebuilding the system.” Id. The Company again provided no further detail regarding these expenses, and provided no affidavits in support of this aspect of its request. Finally, the Company requests that the Court order that Ms. Calonge pay it $117,043.34, representing the attorneys’ fees billed by its counsel. The Company did not provide its billing records in support of its claim for attorneys’ fees. Instead, it provided an affidavit of counsel asserting that Mintz, the Company’s counsel, had opened a new matter “when the criminal investigation into Ms. Calonge’s actions was initiated and Mintz was engaged to work with the Company on that investigation….” Galliher Decl. 3. The Company’s counsel avers that: The entirety of that amount reflects work performed in furtherance of this investigation and prosecution, including, in general terms, consultations and interviews with the FBI and Assistant U.S. Attorneys; preparing and producing documents to the Government; responding to the Government’s requests for documents and other information; preparing witnesses for trial testimony; consulting with Company representatives about the criminal case; and preparing the Victim Impact Statement and this restitution request. The only narrative entries on the bills for client-matter number 047596-017 that do not contain explicit reference to the FBI, the U.S. Attorneys’ Office, the criminal complaint or case, or the Government generally are those that reflect work done in furtherance of the investigation and prosecution of this case. As a general example, time billed for tasks such as responding to emails represents time spent responding to emails about this case. Galliher Decl.
