United States of America v. Michael Lewis Miller

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 03-1519
UNITED STATES OF AMERICA
v.
MICHAEL LEWIS MILLER,
Appellant
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. Crim. No. 96-cr-00051)
District Judge: Hon. Clarence C. Newcomer
Argued December 5, 2003
Decided June 10, 2004
On Remand from the Supreme Court
of the United States April 4, 2005
Before: SLOVITER and ALITO, Circuit Judges, and
OBERDORFER , District Judge*
(Filed: July 29, 2005)
Hon. Louis F. Oberdorfer, United States District Court for
*
the District of Columbia, sitting by designation.

-- 1 of 8 --

This court has previously set forth in great detail the full1
contours of this scheme, see Rennert, 374 F.3d at 207-09; Yeaman,
194 F.3d at 446-48; thus, in the interest of brevity, we will not do
so again.
2
OPINION OF THE COURT
SLOVITER, Circuit Judge.
Before us is the appeal of Michael Lewis Miller following
the order of the United States Supreme Court granting certiorari,
vacating the judgment of this court, and remanding for further
consideration in light of its decision in United States v. Booker,
543 U.S. , 125 S. Ct. 738 (2005). As explained below,
having determined that the sentencing issues implicated here are
best addressed by the District Court in the first instance, we will
remand for resentencing.
I.
In April 1997, a jury sitting in the United States District
Court for the Eastern District of Pennsylvania convicted Miller
(an attorney), as well as his co-defendants George Jensen, Philip
Rennert, and David Yeaman, for their involvement in a complex
scheme involving the leasing of worthless stocks of three public
companies to the Teale Network (“Teale”). See generally
United States v. Rennert, 374 F.3d 206 (3d Cir. 2004); United
States v. Yeaman, 194 F.3d 442 (3d Cir. 1999). Teale, a1
network of fraudulent offshore and domestic companies,
represented these leased stocks as assets available to pay claims
pursuant to reinsurance contracts entered into with a
Pennsylvania-based insurance company, the World Life and
Health Insurance Company (“World Life”). When World Life
attempted to liquidate these assets to pay outstanding medical
reinsurance claims, the stocks were found to be worthless. The
jury convicted Miller of conspiracy, wire fraud, and securities
fraud for his role in the scheme. Rennert, 374 F.3d at 207.

-- 2 of 8 --

3
Thereafter, the District Court, applying the United States
Sentencing Guidelines, sentenced Miller to seven months
incarceration. Notably, although the District Court enhanced the
sentences of Miller, Jensen, and Rennert due to its finding that
their actions caused a loss of confidence in an important
institution, it held that no monetary loss was caused by the
Defendants’ fraud because it found that World Life was
insolvent at the time it entered into reinsurance contracts with
Teale. Thus, for sentencing purposes, the District Court
concluded that the loss amount occasioned by the Defendants’
crimes was zero. The District Court also rejected, over the
United States’ objection, the application of additional sentencing
enhancements for use of special skills (e.g., Miller’s legal
training) and for substantially jeopardizing a financial institution
(the stock market). Rennert, 374 F.3d at 209.
Following these District Court proceedings, Miller and
the other Defendants appealed to this court, challenging, inter
alia, the District Court’s instructions to the jury and the
sufficiency of the evidence supporting their convictions. Id.
The United States filed cross-appeals challenging several of the
District Court’s decisions at sentencing.
By way of several unpublished opinions, see United
States v. Rennert, Nos. 98-1145 & 98-1101, slip op. (3d Cir. Oct.
15, 1999); United States v. Jensen, Nos. 98-1148 & 98-1104,
slip op. (3d Cir. Oct. 15, 1999); United States v. Miller, Nos. 98-
1147 & 98-1103, slip op. (3d Cir. Oct. 15, 1999), as well as one
published opinion, see United States v. Yeaman, 194 F.3d 442
(3d Cir. 1999), we affirmed the convictions in all respects.
However, on the United States’ cross-appeals, we remanded
Miller’s case, along with that of his co-defendants, for
resentencing. See Rennert, 374 F.3d at 209. Specifically, we
directed the District Court to reconsider whether there was a
causal connection between the Defendants’ misrepresentations
and the fraud loss (and, if so, in what monetary amount) and, in
Miller’s case, whether an enhancement would be appropriate for
Miller’s use of special skills (i.e., his legal training).
Pursuant to our directive, the District Court, on February

-- 3 of 8 --

The District Court further imposed sentences of sixty-2
three and thirty months imprisonment on Rennert and Jensen,
respectively. 374 F.3d at 210.
4
3, 2003, held a resentencing hearing for Miller, Jensen, and
Rennert. At this hearing, Miller attempted to present testimony
and documents in support of his argument that the scope of his
involvement in the conspiracy was less than that of his co-
conspirators and that the extent of the total loss caused by the
fraud was not foreseeable to him. The District Court declined to
permit Miller to submit evidence that was not already presented
at trial because the issue was “subsumed” by the jury’s verdict
and was therefore immaterial to sentencing. Rennert, 374 F.3d
at 209-10.
On February 13, 2003, the District Court issued an
opinion finding that there was “‘a causal connection between the
misrepresentations of the Defendants and the continued payment
of premiums to World Life . . . and the Defendants,’” Rennert,
374 F.3d at 210 (quoting opinion of District Court), and that, for
purposes of sentencing, the total fraud loss caused by Miller and
his co-defendants was approximately $3.2 million. In addition,
the District Court enhanced Miller’s sentence on the basis of his
use of special skills and more than minimal planning. The
District Court further enhanced Miller’s sentence due to its
finding that his actions caused the loss of confidence in an
important institution — the stock market. Ultimately, applying
the Guidelines as mandatory, the District Court sentenced Miller
to fifty-one months in prison. 374 F.3d at 210.2
Miller again appealed to this court, as did Rennert and
Jensen. All three of the Defendants challenged the District
Court’s factual finding of a causal connection between their
misrepresentations and the victim’s loss, as well as the amount
of fraud loss. Furthermore, relying on United States v. Collado,
975 F.2d 985 (3d Cir. 1992), Miller argued that the District
Court misapplied U.S.S.G. § 1B1.3, the relevant conduct
provision of the Guidelines. Miller also challenged the District
Court’s order barring him from submitting additional evidence at

-- 4 of 8 --

In Blakely, the Supreme Court, applying the rule3
announced in Apprendi v. New Jersey, 530 U.S. 466 (2000), held
unconstitutional certain applications of the State of Washington’s
determinate sentencing scheme.
5
the resentencing hearing. This court, by opinion filed June 10,
2004, affirmed the District Court’s sentencing determinations in
all respects. Rennert, 374 F.3d at 217.
Several weeks after this court issued its opinion affirming
Miller’s post-remand sentence, the Supreme Court decided
Blakely v. Washington, 542 U.S. 296 (2004). Thereafter,3
relying on Blakely, Miller filed a petition for a writ of certiorari
in the Supreme Court. While Miller’s petition was pending, the
Supreme Court decided Booker. The Court then granted
Miller’s petition for a writ of certiorari, vacated this court’s
judgment at 374 F.3d 206, and ordered the case “remanded to
the United States Court of Appeals for the Third Circuit for
further consideration in light of . . . Booker. . . .” Miller v.
United States, U.S. , 125 S. Ct. 1744 (2005) (mem.).
That is the order on which we proceed.
II.
As discussed in more detail in United States v. Davis, 407
F.3d 162 (3d Cir. 2005) (en banc), the Supreme Court in Booker
held that the Sixth Amendment to the United States Constitution
“as construed in Blakely does apply to the [United States]
Sentencing Guidelines.” Booker, 543 U.S. at , 125 S. Ct. at
746 (Stevens, J.). Booker was decided by two opinions of the
Court. In the first opinion, authored by Justice Stevens for a
majority of five, the Court reaffirmed the holding in Apprendi v.
New Jersey, 530 U.S. 466 (2000), that “[a]ny fact (other than a
prior conviction) which is necessary to support a sentence
exceeding the maximum authorized by the facts established by a
plea of guilty or a jury verdict must be admitted by the defendant
or proved to a jury beyond a reasonable doubt,” and extended
that rule to the United States Sentencing Guidelines. Booker,
543 U.S. at , 125 S. Ct. at 756 (Stevens, J.). The second

-- 5 of 8 --

6
opinion, authored by Justice Breyer for a majority of five,
focused on the remedy. The Court held that 18 U.S.C. §
3553(b)(1), the provision of the Sentencing Reform Act of 1984
that made the Guidelines mandatory, was incompatible with the
Court’s constitutional ruling; thus, the Court severed and excised
§ 3553(b)(1). Similarly, 18 U.S.C. § 3742(e), “the provision that
set[ ] forth standards of review on appeal, including de novo
review of departures from the applicable Guidelines range,” was
also severed and excised because it contained critical cross-
references to the section that made the Guidelines mandatory.
543 U.S. at , 125 S. Ct. at 764 (Breyer, J.). The net result
was to delete the mandatory nature of the Guidelines and
transform them to advisory guidelines.
This court has taken the position that Booker sentencing
issues raised on direct appeal are best determined by the district
courts in the first instance. See United States v. Davis, 397 F.3d
173, 183 (3d Cir. 2005) (“In light of the determination of the
judges of this court that the sentencing issues appellants raise are
best determined by the District Court in the first instance, we
vacate the sentences and remand for resentencing in accordance
with Booker.”), reh’g denied, 407 F.3d 162 (3d Cir. 2005) (en
banc); see also United States v. Bruce, 405 F.3d 145, 150 (3d
Cir. 2005); United States v. Remoi, 404 F.3d 789, 796 (3d Cir.
2005); United States v. Ordaz, 398 F.3d 236, 239 (3d Cir. 2005).
Moreover, we have adhered to this position in cases involving a
procedural posture similar to the one at bar. See, e.g., United
States v. Agnew, 407 F.3d 193, 195 (3d Cir. 2005) (analyzing
case wherein Supreme Court issued order granting certiorari and
remanding in light of Booker, ultimately stating that “having
concluded that the sentencing issues based on Booker are best
determined by the District Court in the first instance, we will
vacate the sentence and remand . . . .”). In conformance with
this precedent, we will vacate Miller’s sentence and remand to
the District Court for resentencing in accordance with Booker.
Considering, however, that in vacating our judgment, the
Supreme Court did not discuss, let alone call into question,
Miller’s underlying conviction or our holdings thereon, this court
will not remand the issue of Miller’s conviction to the District

-- 6 of 8 --

7
Court. Thus, to be perfectly clear: the only issue that the
District Court is to consider on remand is that of Miller’s
sentence. Cf. Agnew, 407 F.3d at 195.
We further note that, in its February 13, 2003 opinion
calculating Miller’s sentence, the District Court engaged in a fair
amount of judicial fact finding. For instance, the District Court
itself resolved the issue of causation with respect to fraud loss
and further determined the amount of loss occasioned by
Miller’s crimes. It also decided — without any jury findings on
such topics — that Miller had utilized special skills and had
occasioned a loss of confidence in an important institution. In
addition to engaging in such judicial fact finding, the District
Court also necessarily resolved various procedural decisions at
the sentencing hearing; for example, it declined to permit Miller
to submit the additional evidence he proffered at the February 3,
2003 sentencing hearing. Rennert, 374 F.3d at 210. And, as
discussed above, this court affirmed the District Court’s factual
findings, legal conclusions, and procedural decisions in all
respects.
Nothing in Booker or the Supreme Court’s order in this
case necessarily calls into question the correctness of the District
Court’s factual findings or procedural decisions at the
resentencing, or, for that matter, this court’s approval thereof.
To be sure, in light of Booker the District Court on remand must
employ the Guidelines as advisory precepts rather than as
mandatory. It must further tailor Miller’s sentence in
perspective of the statutory requirements identified by the
Booker Court, such as the statutory requirements that a sentence
reflect the seriousness of the offense, promote respect for the
law, provide just punishment, and afford adequate deterrence.
Booker, 543 U.S. at , 125 S. Ct. at 764-65 (Breyer, J.) (citing
18 U.S.C. § 3553(a)).
We merely note that the District Court is free to engage in
precisely the same exercise in judicial fact finding as it did in
February 2003, so long as such fact finding is consistent with
Booker. Cf. United States v. Antonakopoulos, 399 F.3d 68, 75
(1st Cir. 2005) (“The error is not that a judge (by a

-- 7 of 8 --

preponderance of the evidence) determined facts under the
Guidelines which increased a sentence beyond that authorized by
the jury verdict or an admission by the defendant; the error is
only that the judge did so in a mandatory Guidelines system.”).
Likewise, nothing in Booker causes us to retreat from our prior
approval of the District Court’s interpretation and application of
the Guidelines to Miller’s case (save, of course, the fact that the
Court interpreted and applied the Guidelines as mandatory).
Finally, as was true when it conducted its sentencing in February
2003, the District Court is free to use its ordinary discretion in
handling the various procedural issues (such as the admission of
additional evidence) that may arise.
III.
For the foregoing reasons, we will vacate Miller’s
sentence and remand to the District Court for resentencing in
accordance with Booker.

-- 8 of 8 --