No: 02-3101 No: 02-3775 UNITED STATES OF AMERICA v. Michael McCarrin

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No: 02-3101
No: 02-3775
UNITED STATES OF AMERICA
v.
MICHAEL MCCARRIN,
Appellant
___________________
On Appeal From the United States District Court
For the Eastern District of Pennsylvania
(D.C. Criminal No. 99-cr-00488-02)
District Judge: Honorable James T. Giles
_______________
___________________________
Submitted Under Third Circuit LAR 34.1(a)
December 10, 2002
Before: BECKER, Chief Judge, ROTH and SMITH,
Circuit Judges
(Filed: December 16, 2002)
Timothy R. Rice, Esquire
Suite 1250
Office of the United States Attorney
615 Chestnut Street
Philadelphia, PA 19106
Attorney for Appellee
Michael W. McCarrin

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2235 N. Providence Road
Media, PA 19063
Pro se Petitioner
_________________
OPINION
__________________
D. BROOKS SMITH, Circuit Judge
Appellant Michael McCarrin appeals from the judgment of the United States
District Court for the Eastern District of Pennsylvania entered on July 26, 2002 pursuant to
our order remanding for resentencing following McCarrin’s appeal from the initial
judgment. McCarrin contends that 18 U.S.C. § 1346 fails to state an offense and is
unconstitutionally vague, and that the District Court abused its discretion in ordering
$50,000 in restitution. We hold that McCarrin waived his constitutional challenges to 28
U.S.C. § 1346 by failing to raise these issues in his opening brief on his earlier direct
appeal. We will also affirm the District Court with respect to the restitution order.
I.
McCarrin was convicted of nine counts of mail fraud and two counts of money
laundering in violation of 18 U.S.C. §§ 1341, 1346, and 1957. He was sentenced to twenty-
four months imprisonment, and ordered to pay $414,028 in restitution and to forfeit
$31,289. McCarrin filed an earlier direct appeal challenging his conviction on a variety of

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1This provision, which is entitled “Definition of ‘scheme or artifice to defraud,’”
provides that “for the purposes of this chapter, the term ‘scheme or artifice to defraud’
includes a scheme or artifice to deprive another of the intangible right of honest services.”
18 U.S.C. § 1346.
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grounds, including the legal validity of the government’s honest services mail fraud theory,
the court’s legal instructions, and his ability to pay restitution. A prior panel of this court
affirmed McCarrin’s conviction and sentence, but remanded for the limited purpose of
allowing the District Court to make additional findings regarding McCarrin’s ability to pay
restitution.
McCarrin petitioned for rehearing en banc, contesting the legal validity of his honest
services mail fraud and his money laundering conviction. His petition for rehearing en banc
was denied. He also filed a certiorari petition in the Supreme Court which remains
pending.
At the resentencing on the restitution issue, the District Court, following a hearing,
reduced McCarrin’s restitution obligation to $50,000. On that same day, McCarrin filed a
motion to dismiss the indictment for failure to state an offense and on the ground that 28
U.S.C. § 1346 is unconstitutionally vague.1 The District Court denied McCarrin’s motion
as “legally frivolous.”
II.
Since the facts underlying McCarrin’s conviction for mail fraud and money
laundering are not relevant to the disposition of this appeal, we recite only the facts relating

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to the restitution issue. On remand, the District Court reduced McCarrin’s restitution
obligation from $414,028 to $50,000. In support of its determination that McCarrin would
be able to pay $50,000, the District Court noted that McCarrin is a well-educated attorney,
he was able to send his children to private elementary schools, high schools, and
universities, and he resides in a $290,000 home.
The Government noted in its brief that in lieu of putting his resources toward
repaying the victim, McCarrin planned to spend over $200,000 in the next six years to
finance his childrens’ education. He also had spent $200,000 to finance his living expenses
during his trial and appeal.
McCarrin argued that he had a negative net worth and faced serious obstacles to
repaying his restitution and forfeiture obligations. In setting the restitution amount, the
Court considered “all the circumstances,” including McCarrin’s “present financial
condition, as well as his future earning capacity, assuming even that he does not practice
law.”
The District Court balanced the rights of the victim with McCarrin’s financial
situation, noting that McCarrin had failed to make “any plan to pay restitution” in the two
years since his sentence was imposed. Based on McCarrin’s testimony, the Court found
that McCarrin’s “hopes and aspirations for his family would result in a complete
liquidation” of his assets. Adopting McCarrin’s position would, in the District Court’s
view, have rendered McCarrin “economically insulated from the payment of any

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restitution.”
III.
We have jurisdiction to review the restitution order and the denial of McCarrin’s
motion to dismiss his indictment under 28 U.S.C. § 1291. We review the appropriateness
of a district court’s order of restitution for abuse of discretion. United States v. Hunter, 52
F.3d 489, 492 (3d Cir. 1995). Constitutional questions and challenges to the sufficiency
of an indictment are issues of law subject to plenary review. United States v. Singletary,
268 F.3d 196, 198 (3d Cir. 2001), cert. denied, 122 S.Ct. 1450 (2002).
IV.
We hold that the District Court properly exercised its discretion in reducing
McCarrin’s restitution obligation from $414,028 to $50,000, and we will affirm. Since
McCarrin’s offenses occurred prior to 1996, the amount he owes in restitution is governed
by an earlier version of 18 U.S.C. § 3664, which has now been amended. The former
version of the statute prescribed that, in exercising its discretion to determine the
appropriate amount of restitution, the court should consider the following factors, in
addition to the victim’s losses as a result of the offense: “the financial needs and earning
ability of the defendant and the defendant’s dependants, and . . . such other factors as the
court deems appropriate.” 18 U.S.C. § 3664(d)(3).
A prior panel of this court remanded with respect to the order for McCarrin to pay

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2The District Court stated that although it was only imposing $50,000 in restitution, it
would have been justified in imposing over $200,000, since in the court’s view, the
defendant owed a greater obligation to pay back the victim of his crime, and could easily
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$414,028 in restitution, finding that the District Court had not made sufficient findings
with respect to McCarrin’s “ability to pay” in calculating the amount he owed. The prior
panel noted that “our review of the record suggests that the order for restitution, though
merely compensating Lloyd’s of London for its loss as the victim’s insurer, may have been
excessive.”
We find that the District Court properly exercised its discretion in revising the
restitution amount. The District Court noted on the record that it would assess restitution
by examining “the amount of restitution, the amount of the loss to the victim, the
defendant’s ability to pay the full amount or part of it, considering present assets, present
capability, as well as future ability to pay reasonably into the future.” We are satisfied that
the District Court balanced these factors and did not abuse its discretion in reaching the
result of $50,000. In analyzing McCarrin’s future ability to pay, the Court recognized that,
although trained as a lawyer, McCarrin might be unable or choose not to practice law,
thereby possibly reducing his earning potential. The Court also acknowledged that
McCarrin wished to send his children to private schools and had financed college tuition
for his two oldest children, which imposed a significant additional financial burden on him.
Consequently the District Court significantly lowered the amount McCarrin would pay as
restitution.2 Nevertheless, the Court properly considered the fact that Mr. McCarrin was

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have sent his children to public schools. “The rationale for 200 plus would simply be this,
that when money is taken from somebody or some institution, it is money that should be
returned. The defendant has an obligation to return that money, and the defendant should
put as a priority the repayment of that restitution, even if it handicaps family members who
are not handicapped by virtue of the restitution order, but are handicapped by virtue of the
defendant’s criminal act.”
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trained as an attorney, enjoyed good health, resided in a $290,000 home, and planned to
resume employment upon serving his prison term. In addition, in the two years since his
conviction, Mr. McCarrin had made no efforts to pay any of the restitution. The District
Court properly exercised its discretion in analyzing the appropriate factors, and we will
affirm.
V.
We conclude that the District Court properly denied McCarrin’s motion to dismiss
the mail fraud charges against him. On the day of his resentencing on restitution, the
appellant filed a motion to dismiss the mail fraud charges for failure to allege an offense
and as unconstitutionally vague. Specifically, McCarrin argued that: (1) section 1346 of
the mail fraud statute was not applicable to his conduct; and (2) section 1346 is
unconstitutionally vague. The District Court rejected that motion as “legally frivolous,” and
we will affirm, but for different reasons. We hold that McCarrin waived his right to pursue
these constitutional challenges by failing to timely raise them on direct appeal.
McCarrin first argued that § 1346 failed to state an offense in his petition for
rehearing en banc on his earlier direct appeal. He did not raise it before the initial panel.

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3 McCarrin’s contentions before the panel were, as stated in Judge Greenberg’s panel
opinion, “that it was possible that he was convicted of mail fraud predicated on
impermissible cobbling together of different theories. Moreover, he contends he might
have been convicted on an invalid legal theory, the jury instructions were improper, and the
court did not make sufficient findings concerning his ability to make restitution.”
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McCarrin first raised his vagueness challenge to § 1346 in his petition for certiorari to the
Supreme Court, which is currently pending.
Although this court has held that Rule 12(b)(2) challenges that an indictment fails to
state an offense may be raised for the first time on appeal, United States v. Panarella, 277
F.3d 678, 685 (3d Cir.), cert. denied, 123 S.Ct. 95 (2002), Panarella is distinguishable. In
Panarella, the defendant raised his 12(b)(2) challenge in his opening brief upon direct
appeal to the Third Circuit panel. Here, McCarrin did not raise this issue before the panel,
but rather for the first time in his petition for rehearing en banc.3 Our jurisprudence is
clear that “an issue is waived unless a party raises it in its opening brief.” Tse v. Ventana
Medical Systems, Inc., 297 F.3d 210, 225 n.6 (3d Cir. 2002)(quoting Reform Party of
Allegheny County v. Allegheny County Dep’t of Elections, 174 F.3d 305 n.11 (3d Cir.
1999)). This court has recently made clear that raising an issue for the first time in a
petition for rehearing en banc fails to preserve the issue for subsequent review. United
States v. Cross, 308 F.3d 308, 314 (3d Cir. 2002).
McCarrin has similarly failed to preserve his unconstitutional vagueness challenge
by failing to raise it in his opening brief to the prior panel of this court on direct appeal, and
may not now assert it in a subsequent appeal. Claims of error that “could and should have

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been raised” on direct appeal are not preserved for review in a subsequent appeal.” United
States v. Pultrone, 241 F.3d 306-07 (3d Cir. 2001).
Since McCarrin failed to preserve his challenges to the mail fraud statute on direct
appeal, we find that he has waived these claims and may not pursue them again via the prior
panel’s narrow remand on a restitution issue. The District Court’s denial of McCarrin’s
motion to dismiss the indictment will be affirmed.
VI.
For the foregoing reasons, the judgment of the District Court will be affirmed.
/s/ D. Brooks Smith
Circuit Judge

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