United States of America v. Jerald P. Romine

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
__________
No. 01-4233
__________
UNITED STATES OF AMERICA
v.
JERALD P. ROMINE,
Appellant
__________
ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
D.C. Crim. No. 01-cr-00397-1
District Judge: The Honorable Harold A. Ackerman
__________
Submitted Under Third Circuit LAR 34.1(a)
June 7, 2002
__________
Before: NYGAARD, BARRY, and MAGILL, Circuit Judges
(Opinion Filed: June 18, 2002)
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OPINION
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BARRY, Circuit Judge
Appellant Jerald P. Romine pleaded guilty to a two-count Information charging
him with securities fraud in violation of 15 U.S.C. 78j(b) and 78ff and 17 C.F.R.
240.10b-5 and filing a false tax return in violation of 26 U.S.C. 7206(1). The District
Court sentenced Romine to 27 months of imprisonment and three years of supervised
release, assessed a $150 fine, and ordered him to pay restitution in the amount of
$500,000 to UBS PaineWebber, Inc. ("PaineWebber") and Van Dyk Health Care, Inc.
("Van Dyk"). Romine appeals that portion of his sentence ordering him to pay
restitution, although he does not contest the amount of restitution ordered if restitution is
otherwise appropriate. We have jurisdiction pursuant to 28 U.S.C. 1291 and will
affirm.
Romine argues that the District Court incorrectly determined that PaineWebber
and Van Dyk were "substitute victims" within the meaning of 18 U.S.C. 3663A and
3664. His argument fails. Under 18 U.S.C. 3663A(a), a criminal defendant is
required to pay restitution to the victim of his or her crime. Where a victim receives
compensation from insurance "or any other source" for the loss, restitution shall be paid
to the person who compensated the victim. 18 U.S.C. 3664(j)(1). That is precisely
what we have here. The victims of Romine’s crimes have been fully compensated by
PaineWebber and Van Dyk. As such, Romine is required to pay restitution to those
companies.
Romine counters that PaineWebber and Van Dyk are joint tortfeasors by virtue of
a civil settlement with the victims and, thus, ineligible to receive restitution. In support
of his argument, Romine relies on United States v. Shepard, 269 F.3d 884 (7th Cir.
2001), and urges us to adopt the Seventh Circuit’s analysis. We find Shepard wholly

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inapposite. In Shepard, the Seventh Circuit discussed only the amount of restitution due
a third-party payer and not the underlying obligation to pay restitution under
3664(j)(1); indeed, Shepard does not even mention that section of the Act much less any
notion of "substitute victim." 269 F.3d at 885. Because Shepard does not stand for the
proposition that the language in 18 U.S.C. 3664(j)(1) bars restitution to a person who is
or may be a joint tortfeasor, and our research has disclosed no case which does, Paine
Webber and Van Dyk are permissible "other source[s]" within the meaning of
3664(j)(1).
In a final attack on the District Court’s restitution order, Romine contends that the
$500,000 loss constitutes consequential damages. Romine, however, stipulated in his
plea agreement that the victims’ direct loss equaled between $350,000 and $500,000.
This amount, and more, was paid to the victims by PaineWebber and Van Dyk. The fact
that Romine must now pay $500,000 to the companies and not to the individual victims
does not transform this direct loss into consequential damages.
In sum, the District Court properly ordered Romine to pay restitution to
PaineWebber and Van Dyk. Accordingly, we will affirm the judgment of the District
Court.
TO THE CLERK OF THE COURT:
Kindly file the foregoing Opinion.
/s/ Maryanne Trump Barry
Circuit Judge
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-4233
UNITED STATES OF AMERICA
v.
JERALD P. ROMINE,
Appellant
__________
ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
D.C. Crim. No. 01-cr-00397-1
District Judge: The Honorable Harold A. Ackerman
__________
Submitted Under Third Circuit LAR 34.1(a)
June 7, 2002
__________
Before: NYGAARD, BARRY, and MAGILL, Circuit Judges
JUDGMENT
This cause came to be heard on the record from the United States District Court
for the District of New Jersey and was submitted on June 7, 2002.
After consideration of all contentions raised by the appellant, it is
ADJUDGED and ORDERED that the judgment of the District Court be and

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hereby is affirmed. No Costs. All in accordance with the Opinion of the Court.
ATTEST:
Clerk
Dated: 18 June 2002

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