United States v. Miller ( 2005 )

United States Court of Appeals
Fifth Circuit
F I L E D
In the April 6, 2005
United States Court of Appeals Charles R. Fulbruge III
for the Fifth Circuit Clerk
_______________
m 03-11217
_______________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
VERSUS
FREDERICK CHARLES MILLER,
Defendant-Appellant
_________________________
Appeal from the United States District Court
for the Northern District of Texas
______________________________
Before HIGGINBOTHAM, SMITH, and restitution to Miller’s former employer and the
BENAVIDES, Circuit Judges. IRS. Miller appeals several aspects of the
application of the sentencing guidelines and
JERRY E. SMITH, Circuit Judge: the alleged use of certain admissions in the
sentencing decision, and claims that numerous
After embezzling over a million dollars errors were made with respect to restitution.
from his employer, Frederick Miller pleaded We affirm.
guilty of one count of conducting a monetary
transaction with criminally derived funds and I.
one count of tax evasion; he agreed to the Miller engaged in a scheme to defraud his
forfeiture of about $950,000 in assets. The employer and was indicted on eleven counts:
district court imposed a sentence of ninety-six one count of wire fraud, 18 U.S.C. § 1343;
months’ imprisonment and ordered substantial five counts of theft from a health care benefit
program, id. § 669; and five counts of con- mining that the two offenses should not be
ducting a monetary transaction with criminally grouped, a one-level increase was added to the
derived funds (“money laundering”), id. highest offense level, yielding a total of 26.
§ 1957. A superseding information charged
Miller with tax evasion in the year 2000. See The government objected, contending that
26 U.S.C. § 7201. either (1) § 2F1.1 should be used in conjunc-
tion with a four-level increase because the of-
Miller was, at various times, chief financial fense derived more than $1,000,000 and af-
officer of Medical Pathway (an affiliate of fected a financial institution, generating an of-
Medical Select Management (“MSM”)) and a fense level for the first count of 29; or
related entity, Harris Methodist Select (2) § 2S1.2, the guideline for money launder-
(“HMS”). He wrote checks drawn from the ing crimes, should apply, yielding an offense
accounts of HMS and MSM payable to fic- level of 28. Miller objected, contending that
titious entities and accounts in HMS’s and the factual resume to which he stipulated did
MSM’s names but under his control, and later not constitute fraud, so § 2F1.1 could not ap-
diverted the funds to his own use. None of ply. In sum, after these objections were raised,
this illegally obtained income was declared on the question was whether (before grouping)
his tax returns. the total offense level for the first count would
be calculated under the fraud guideline (result-
Pursuant to a cooperation agreement and, ing in an offense level of 29) or the money
later, a plea agreement, Miller pleaded guilty laundering guideline (resulting in a level of
of one count of conducting a monetary trans- 28).
action with criminally-derived funds (in viola-
tion of 18 U.S.C. § 1957) and one count of At the sentencing hearing, the court denied
income tax evasion (in violation of 26 U.S.C. credit for acceptance of responsibility and ap-
§ 7201). In exchange for these pleas and plied an enhancement for obstruction of justice
agreement to forfeit all embezzled funds, the based on attempts to conceal funds after ar-
government moved to dismiss the remaining rest. The court then ruled that the factual
ten counts. resume did not contain the necessary elements
to make out a fraud offense; opted to sustain
The presentence report (“PSR”) initially Miller’s objection; and rejected the contention
concluded Miller’s offense level for the money that § 2F1.1 applies. Implicitly, therefore, the
laundering count should be calculated using court adopted t he position argued in Miller’s
U.S.S.G. § 2F1.1, the applicable guideline for objection and articulated by the prosecutor at
offenses involving fraud. Using § 2F1.1’s base sentencing that if § 2F1.1 did not apply, then
offense level of 6, incorporating the value of § 2S1.2 o r § 2B1.1 would apply, with either
the stolen funds (+11), considering the sophis- one generating an offense level of 28, which,
ticated means used (+2), t he abuse of a posi- when grouped with the tax offense, yielded 29.
tion of trust (+2), the presence of more than
minimal planning (+2), and taking into account After sustaining Miller’s objection, the
Miller’s obstruction of justice (+2), the PSR court called a recess to allow the probation of-
arrived at an offense level of 25. The PSR ficer to recalculate the total offense level.
also concluded that the tax evasion charge Notwithstanding this intention, the probation
should yield a total offense level of 19. Deter- officer could not be located, and the court
2
eventually imposed sentence without consult- A.
ing her. The offense level used, 29, was of- Miller complains that the court erred in im-
fered by the prosecution, and Miller’s counsel posing an unrealistic schedule of payments for
agreed that this was the appropriate level, but the restitution. The Mandatory Victim’s Res-
cautioned, “I did not do the grouping and, titution Act requires a court to order restitu-
once again, it was pretty cursory. I would tion irrespective of ability to pay. 18 U.S.C. §
prefer to have [the probation officer] do the 3664(f)(1)(A). In determining the manner and
calculation].” The court subsequently ordered schedule with respect to which restitution will
Miller imprisoned for 96 months (a sentence be paid, however, a court must consider, inter
within the 87 to 108 months delineated by the alia, the defendant’s financial resources. Id. §
guidelines for an offense level of 29). 3664(f)(2)(A).
Miller was also sentenced to a three-year The restitution order, as noted above, man-
term of supervised release, as a condition of dates as a condition of supervised release that
which the court ordered him to make restitu- Miller return approximately $1.4 million to his
tion of $1,485,074.24, a large portion of which former employer and the IRS. This restitution
would be covered by the property Miller is payable immediately (and accordingly, a
agreed to forfeit under the terms of the plea substantial portion will be paid with the pro-
agreement. The restitution is payable immedi- ceeds of numerous large forfeitures of prop-
ately, but nonpayment is not a violation of su- erty to which Miller agreed), yet Miller’s
pervised release so long as Miller makes the nonpayment will not be deemed a violation of
ordered payments of at least $500 per month his supervised release so long as he pays in
during his supervised release. accordance with the conditions of supervised
release.1 Miller avers that the order that resti-
II. tution is payable immediately is plain error
Miller alleges a number of errors in the cal- where the court conceded that he is unable to
culation and imposition of restitution. Not- afford both restitution and a fine.
withstanding these arguments on appeal, how-
ever, Miller made no objection with respect to Miller relies exclusively on United States v.
any aspect of the restitution order. Accord- Myers, 19 F.3d 160, 168-69 (5th Cir. 1999),
ingly, we review for plain error. See United for his contention that where the record dem-
States v. Branam, 231 F.3d 931, 933 (5th Cir. onstrates that a defendant is not capable of
2000). This standard requires that we find making immediate restitution, the perfunctory
(1) that an error has occurred; (2) that the reference to the fact that he is unable to pay
error is plain; and (3) that it affects a substan- both a fine and restitution is not sufficient con-
tial right. United States v. Olano, 507 U.S. sideration of his ability to pay to justify the
725, 732- 34 (1993). Nevertheless, even if we restitution schedule. Myers, however is readi-
find plain error, “we will not exercise our ly distinguishable.
discretion to correct a forfeited error unless it
seriously affects the fairness, integrity, or
public reputation of judicial proceedings.”
Branam, 231 F.3d at 933 (citing Olano, 507 1
Miller is required to make monthly payments
U.S. at 735-36). of at least $500 beginning sixty days after his
release from prison.
3
In Myers, the court ordered a lump sum “arising from all relevant conduct, not limited
payment, in contrast to the monthly restitution to that arising from the offenses of conviction
payments here. Although the restitution in this alone.” Though he pleaded guilty to a charge
case is payable immediately, Miller is not of evading income tax only in 2000, he omitted
ordered to make full restitution at once. embezzled income from his 1998 and 1999 tax
Rather, the forfeiture will commence immedi- returns as well. In those years, he avoided
ately, and presuming no other property of his paying $149,136.01 in income taxes. As a
materializes between now and his release, he result, the court could have ordered signifi-
will begin making monthly payments after his cantly more restitution than the $78,808 about
release. This schedule, therefore, is not plain which Miller complains. Consequently, the
error, if it is error at all, in light of the court’s failure to deduct the taxes he did pay in 2000
consideration of Miller’s financial situation was not plain error.
evident in its decision that he is unable to pay
both restitution and a fine. C.
According to Miller, it was plain error for
B. the court to order any restitution to the IRS
As part of the restitution order, Miller is re- because, he says, such an order is not autho-
quired to pay the IRS $335,074.24, which os- rized by any federal statute. The government
tensibly represents the taxes unpaid on his responds that such restitution is authorized un-
unreported income for 2000. Miller contends der several different theories. First, the gov-
that because he paid $78,808 in taxes for that ernment contends that the court possesses the
year, the restitution should be reduced by that power to order restitution as a condition of su-
amount. Miller reported his taxable income pervised release. In United States v. Dahl-
for 2000 as $265,999, with a tax due of strom, 180 F.3d 677, 686 (5th Cir. 1999), we
$78,808. In reality, counting the embezzled held that “although restitution may not be di-
funds, his income was $915,167.52, which rectly permitted under § 3663(a), a district
would have generated a tax liability of court may order restitution within the context
$335,074.24 (the amount that the restitution of a supervised release” pursuant to 18 U.S.C.
order mandates be paid to the IRS). Con- § 3583(d). Thus, although the Victim and
sequently, it is Miller’s position that the res- Witness Protection Act, 18 U.S.C. § 3663,
titution order should require him to pay only does not expressly cover tax offenses such as
the difference, or $256,266.24.2 that under which Miller was convicted,
§ 3583(d) authorizes such restitution as a con-
The government concedes that this was er- dition of Miller’s supervised release.
ror. It nevertheless maintains that no relief
should be afforded because the error was In response, Miller argues that United
harmless, resulted in no prejudice to Miller, States v. Stout, 32 F.3d 901, 904 (5th Cir.
and cannot constitute plain error. In his plea 1994), limits the court’s ability to impose resti-
agreement, Miller agreed to pay all restitution tution, even as a condition of supervised
release, to situations in which the defendant
agreed to such restitution as part of a plea
2 agreement. Therefore, Miller contends, be-
Miller also asserts, and we address, infra, that
no restitution may be properly ordered to the IRS
cause as he did not so agree, § 3583(d) does
at all. not apply.
4
This argument, limiting § 3583(d) to cases he did give his consent to the restitution. In
in which restitution is agreed to in a plea the plea agreement, he acknowledges that the
agreement, is the subject of vigorous debate by maximum penalties for both counts to which
the parties. According to the government, he pleaded guilty (including tax evasion) in-
Stout’s limitation of restitution to cases in clude “restitution to victims or to the commu-
which it is agreed to in the plea agreement is nity, which may be mandatory under the law,
limited to cases in which such restitution and which Miller agrees may include restitu-
would otherwise have been foreclosed by stat- tion arising from all relevant conduct, not lim-
utes that formerly barred restitution for uncon- ited to that arising from the offenses of con-
victed offenses.3 Thus, goes the argument, viction alone . . . .”
Stout limits restitution, by requiring the plea
agreement to allow for it, only in cases in Miller contends this section is ambiguous
which the harm for which restitution is sought and that all such ambiguities must be resolved
was caused by conduct beyond the counts of in his favor, because the government drafted
conviction. Because Miller pleaded guilty of the agreement. See Spacek v. Mar.
tax evasion, Stout’s limitation is inapplicable. Ass’nSSI.L.A. Pension Plan, 134 F.3d 283,
298-99 (5th Cir. 1998). There is, however, no
ambiguity. Miller was pleading guilty of, inter
Miller disputes this logic, concluding that alia, tax evasion. He agreed that by pleading
Stout’s limitation is wholly unrelated to wheth- guilty he recognized that the maximum penal-
er the restitution is sought for unconvicted ties that might be imposed on him included
conduct. Instead, Miller believes that Stout restitution for all relevant conduct. Stout is
stands squarely against any imposition of therefore inapplicable, because Miller con-
restitution as a condition of supervised release sented to the restitution. Ordering restitution
without the defendant’s consent in a plea was, consequently, not plain error.
agreement.
D.
As the government points out, this interpre- Miller is simultaneously being asked to
tation of § 3583 and Stout would preclude the make restitution to his former employer of
imposition of restitution as a condition of su- $1,150,000 and to the IRS of $335,074.24.
pervised release in any case in which the de- According to Miller, this order is plain error
fendant goes to trial and is convicted. Yet, no- because it directs him to make his employer
where in the statute is such a counterintuitive whole, yet he still must pay restitution in the
intention manifest. amount of taxes he would have been liable for
if he had reported the embezzled fundsSSthe
We need not resolve that particular dispute. same embezzled funds he is ordered to re-
Despite Miller’s protestations to the contrary, turnSSon his income tax returns. Once again,
however, Miller failed to object and raise this
3
argument with the district court. Under the
Congress later changed this situation by al- ensuing plain error standard of review, he
lowing restitution based on any harm caused by a
cannot prevail.
scheme, conspiracy, or pattern of criminal activity,
even if no harm resulted from the offense to which
a defendant pleads guilty. See 18 U.S.C.
In the first instance, the argument that Mil-
§ 3663A(a)(2). ler makes, although possessing some intuitive
5
appeal, is a novel one in this circuit. It would less nature of the purported error, we cannot
therefore be a stretch of language to dub the say that the trial court’s action was plain error.
district court’s decision “‘obvious,’ ‘clear,’ or
‘readily apparent,’ [an error that is] so con- E.
spicuous that ‘the trial judge and prosecutor Miller contends that the restitution order
were derelict in countenancing [it], even ab- incorrectly identifies the corporate entity to
sent the defendant’s timely assistance in de- which restitution is owed. Miller is undeterred
tecting [it].’” United States v. Dupre, 117 by the fact that if the alleged error is corrected
F.3d 810, 817 (5th Cir. 1997) (quoting United and restitution is payable to a different entity,
States v. Calverley, 37 F.3d 160, 163 (5th Cir. he will still be liable for the same amount of
1994) (en banc )). Absent any precedent restitution. Apparently, in Miller’s eyes, this
directly supporting Miller’s contention, it can- constitutes plain errorSSan error affecting
not be said that the alleged error was “plain” substantial rights that “seriously affects the
for purposes of our review. fairness, integrity, or public reputation of
judicial proceedings.” Olano, 507 U.S. at 732.
Furthermore, even if we were to say that
such an error is “plain,” Miller would not nec-
essarily be entitled to relief. As discussed The basis of Miller’s argument is rooted in
above, plain error review precludes relief ex- the changes in corporate structure that his em-
cept where the putative error affects a substan- ployer underwent during his tenure. Essen-
tial right. Olano, 507 U.S. at 732- 34. Even tially, according to Miller, although restitution
then, “we will not exercise our discretion to was ordered payable to MSM, only a small
correct a forfeited error unless it seriously af- portion of the embezzled funds was embezzled
fects the fairness, integrity, or public reputa- from MSM. Instead, Miller contends that he
tion of judicial proceedings.” Branam, 231 initially was employed by HMS, which was
F.3d at 933 (citing Olano, 507 U.S. at controlled by Harris Methodist Health Systems
735-36). (“HMHS”), which was in turn owned by Texas
Health Resources (“THR”). At the beginning
Given that the district court was statutorily of 1999, allegedly HMHS, and thus THR,
empowered to impose a fine in addition to res- divested itself of all interest in HMS, and HMS
titution, it cannot be that Miller’s substantial subsequently became MSM. As part of this
rights were affected. In the absence of the or- transaction, Miller states that THR agreed to
der mandating restitution to the IRS that Mil- assume almost $25 million in liabilities on
ler seeks to have vacated, the district court behalf of HMS. Thus, goes the argument, any
could have, and indeed likely would have im- embezzlement occurring before the formation
posed a fine, making any error harmless.4 of MSM should be payable to THR, not
Thus, considering the novelty of Miller’s claim MSM.
(a fact that belies the “plain” nature of the
supposed error), coupled with the likely harm- The government counters with multiple ar-
guments. According to its first theory, even if
restitution was ordered to the wrong entity
4 and “should go to either HMHS or THR
It was only after noting that Miller would not
be able to afford both restitution and a fine that the
because of some contractual obligation, then
court declined to impose a fine. that is a matter for those parties to determine
6
among themselves.” This argument is unper- to this proceeding, neither can claim that its
suasive. If the court truly incorrectly divined substantial rights are affected. We therefore
the correct victim to which restitution is owed, affirm the restitution order.
the dictates of § 3663 would be violated,
because under the terms of that section restitu- III.
tion would not be going to the “victim.” Miller raises a number of issues with re-
Perhaps it could be argued that this is not plain spect to his sentencing. We reject these chal-
error, but forcing private “victims” to litigate, lenges and affirm the sentence.
in civil court, the question of who is entitled to
the restitution likely affects the integrity and A.
public reputation of the courtSSnot to mention Miller contends that the district court vio-
the fact that it is inefficient. lated Federal Rule of Criminal Procedure
32(d)(1)6 and U.S.S.G. §§ 6A1.2 and 6A1.37
The government next posits that the change by failing to allow the probation officer to
from HMS to MSM was merely a name alter- “identify all applicable guidelines” after the
ation and that no relevant change took place. court sustained Miller’s objection to the use of
Additionally, it contends that the PSR, on the fraud guideline as initially suggested in the
which the court relied, constituted sufficient PSR. Specifically, Miller suggests that the
evidence for the court to conclude that MSM decision to sentence him without benefit of the
was due the restitution, and Miller did not pre- probation officer’s recalculation of the applica-
sent evidence to the contrary.5 The evidence ble offense level deprived him of a meaningful
in the record seems to support Miller’s posi- sentencing hearing and requires a vacatur of
tion. According to the PSR, much of the his sentence.
embezzlement took place before the corporate
changed took place, so a substantial portion of
the restitution would seem properly payable
not to MSM, but to THR. 6
The rule reads, in pertinent part,
Nevertheless, because Miller would be re-
The presentence report must:
quired to pay the same amount in restitution,
regardless of which entity receives it, he can- (A) identify all applicable guidelines and policy
not show that any error affects his substantial statements of the Sentencing Commission;
rights. As inefficient as it may seem to force
the competing entities to sort out this dispute (B) calculate the defendant’s offense level and
themselves, our scope of review is highly criminal history category . . . .
circumscribed where an error is unobjected to,
and because neither THR nor MSM is a party FED R. CRIM. P. 32(d)(1).
7
These provisions prescribe that “[c]ourts shall
adopt procedures for the timely disclosure of the
5
See United States v. Londono, 285 F.3d 348, presentence report [and] the narrowing and res-
354 (5th Cir. 2002) (“In general the PSR bears olution . . . of issues in dispute,” U.S.S.G.
sufficient indicia of reliability to be considered as § 6A1.2, and that “the parties shall be given an ad-
evidence by the district court, especially when there equate opportunity to present information to the
is no evidence in rebuttal.”). court regarding the factor,” id. § 6A1.3.
7
At the outset, there is some dispute as to court correctly reached without benefit of the
whether Miller properly objected on this issue. probation officer’s assistance. Any error,
If not, our review is for plain error rather than therefore, is harmless.
abuse of discretion.8
Further, it does not appear that the decision
Apparently the court was aware of Miller’s to proceed with sentencing was error at all.
request that the probation officer make the re- Contrary to Miller’s assertions, neither the text
calculation; therefore the court had an oppor- of rule 32 nor §§ 6A1.2 and 6A1.3, nor our
tunity to correct the alleged error. As Miller precedents interpreting them, require the court
points out, requiring him to renew his objec- to allow the probation officer to make a recal-
tion once the court decided to impose sentence culation following the sustaining of an ob-
without further input would be tantamount to jection to the PSR. Rule 32(d), the provision
requiring him to continue objecting after the on which Miller most heavily relies, merely
court had ruled (a rule akin to the old require- requires that the PSR include an identification
ment of taking exceptions). Miller’s counsel of all applicable guidelines. Nowhere does the
communicated to the court, in no uncertain rule indicate that a new PSR must be gener-
terms, that he would “prefer to have Ms. Mc- ated after every decision by the court with
Millan,” the probation officer, do the calcula- respect to those calculations.
tion. This articulation served the purposes of
rule 52(b), which is designed to “provide the In United States v. Knight, 76 F.3d 86, 88
trial judge an opportunity to avoid or correct (5th Cir. 1996), we held that “at least if the de-
any error.” United States v. Rodriguez, 15 fendant has actual knowledge of the facts on
F.3d 408, 417 (5th Cir. 1994); FED. R. CRIM. which the district court bases an enhancement
P. 52(b) . The proper standard of review, or a denial of a reduction, the Sentencing
therefore, is abuse of discretion. Guidelines themselves provide notice of the
grounds relevant to the proceeding sufficient
Even under that standard (more generous to satisfy the requirements of Rule 32 and
than plain error), Miller’s argument is merit- U.S.S.G. § 6A1.3.” Miller was provided with
less. He objected to the guideline used to more than adequate notice of the grounds on
calculate the applicable offense level in the which the court would impose sentence. In
PSR and instead suggested the use of a differ- fact, the main issue of dispute at the sentencing
ent guideline. The court sustained the objec- hearingSSthe choice of applicable guideline for
tion. It is therefore difficult to imagine how the money laundering countSSwas the subject
any alleged error in procedure could have pre- of Miller’s own objection to the PSR.
judiced Miller. If the sentence were vacated, Miller tries to distinguish Knight and urges
on resentencing the probation officer would that United States v. Zapatka, 44 F.3d 112,
merely reach the same conclusion that the 114 (2d Cir. 1994), is more on point. There,
the court held that the sentencing procedure
was violative of rule 32 and § 6A1.3. Refer-
8
ence to Zapatka, however, is unavailing, be-
Compare United States v. Henry, 288 F.3d
cause there the district court, apparently sua
657, 664 (5th Cir. 2002) (plain error where no ob-
sponte, applied a guideline different from than
jection) with United States v. Narvaez, 38 F.3d
162, 165 (5th Cir. 1994) (application of § 6A1.3
that used in the PSR. Id.
and rule 32(c) reviewed for abuse of discretion).
8
In stark contrast, here the court sustained safe in their house. In previous interviews
Miller’s objection to the guideline used in the with agents, Miller had admitted that some of
PSR and utilized the guideline that Miller him- the stolen money was hidden in two safes in
self argued should apply. Consequently, the his attic. Yet, when agents arrived to search
procedures used in this case violated neither his residence, only one safe was there. Appar-
the text of rule 32 or the guidelines nor their ently, Miller’s father-in-law then arrived with
underlying purpose of giving defendants ade- the other, eventually admitting that Miller’s
quate notice such that there can be “focused, wife had brought him the safe the previous
adversarial resolution of the legal and factual night.
issues relevant to fixing Guidelines sentences
. . . .” Burns v. United States, 501 U.S. 129, Unbeknownst to Miller, his conversations
137 (1991). with his wife, during which he allegedly told
her to remove the money, were recorded.
B. When confronted with this fact and shown the
1. inmate call logs, Miller conceded, “It’s true
Miller avers that he is entitled either to . . . okay, it’s true.”
withdraw his plea or to be resentenced before
another judge because the district court im- Faced with these facts, the PSR recom-
properly considered self-incriminating state- mended that an obstruction-of-justice enhance-
ments made by Miller to government agents. ment be applied to Miller’s offense levelSSan
Twelve days after his arrest, Miller entered in- enhancement to which Miller objected, claim-
to a cooperation agreement with the govern- ing that he had later abandoned his attempt to
ment. The government agreed that no self- conceal the funds. After reviewing the tapes
incriminating statements made by Miller in the of the conversations, the probation officer
course of his interviews with government concluded that the obstruction-of-justice
agents would be used against him in any trial enhancement was justified. The district court,
or sentencing. based on Miller’s conduct with respect to the
concealed funds, denied a reduction for accep-
This broad proposition, however, was tance of responsibility and applied the ob-
subject to numerous caveats, including the struction-of-justice enhancement.
understanding that if Miller made any materi-
ally false or misleading statement, all state- 2.
ments could be used against him. The gov- Miller claims that his statements regarding
ernment further agreed that any information the concealed funds are protected by the co-
provided by Miller would be covered by operation and plea agreements and § 1B1.8
U.S.S.G. § 1B1.8, which (subject to some ex- and therefore could not be properly considered
ceptions) deems self-incriminating statements at sentencing. He further argues that the gov-
made pursuant to a cooperation agreement un- ernment cannot now claim that he was in
usable at sentencing. breach of the agreements, because it failed to
declare a breach before sentencing. Attempt-
Miller made more trouble for himself when ing to preempt the government’s inevitable re-
he allegedly attempted to communicate with sponse that the court could have reached the
his wife, in code, that she should remove and same conclusion without relying on his state-
conceal some $40,000 that was stashed in a ments, Miller contends that the record does
9
not demonstrate that the same information was to the court.9 Nevertheless, there is a mean-
available absent the statements. He lastly ingful difference between this case and
avers that regardless of any prejudice that may Castaneda in that Miller did not object, so our
or may not have befallen him, relief is war- review is for plain error.
ranted because the consideration of the state-
ments was virtually a per se violation of the Regardless of whether Miller breached the
cooperation and plea agreements that requires agreement, however, the government argues
a remedy. quite correctly that the record is replete with
information on which the court could have
The government makes a three-pronged re- reached the same conclusions independently of
sponse. First, it maintains that there was more the disputed admissions. Besides averring that
than adequate information in the record, inde- the record does not contain such evidence,
pendent of Miller’s statements, from which the Miller contends that in the context of the gov-
court divined that Miller was not entitled to an ernment’s failure to honor its agreements, such
acceptance of responsibility reduction (and in- errors are never harmless and constitute plain
deed deserved an obstruction of justice en- error in most cases.10
hancement). Second, the government con-
tends that § 1B1.8 is inapplicable because, by These cases, contrary to Miller’s conten-
its own terms, it covers only self-incriminating tion, do not establish that a failure to fulfill
evidence gleaned while the defendant provides promises contained in agreements constitutes
information concerning the unlawful activities per se plain error.11 Where, as here, the record
of others. Miller, in contrast, goes the argu- contains ample bases for the court to make the
ment, was only admitting to his own miscon- same determination regardless of the disputed
duct. Lastly, the government posits that the admissions,12 it cannot be said that the use of
cooperation agreement was breached by
Miller’s initially false statements regarding the
9
concealed $40,000. The obvious counter argument to this, how-
ever, is that the government never raised the spec-
The government’s breach argument con- ter of breach because Miller never objected to the
tains a major weakness. As Miller correctly use of his statements. Nevertheless, it would be
unjust to say that the government forfeits this ar-
points out, the government ratified the cooper-
gument on appeal where it was not given a mean-
ation agreement after the alleged breach when
ingful motivation for bringing it in the district court
it tendered the cooperation agreement to the because of Miller’s failure to object.
court at Miller’s rearraignment. As we held in
United States v. Castaneda, 162 F.3d 832, 836 10
See, e.g., United States v. Wilder, 15 F.3d
(5th Cir. 1998), in the context of non-prosecu- 1292, 1301 (5th Cir. 1994).
tion agreements the government is prevented
11
by due process considerations from unilaterally See United States v. Goldfaden, 959 F.2d
determining that a defendant is in breach and 1324, 1328 (5th Cir. 1992) (“We thus conclude
nullifying the agreement. At the very least, that a prosecutor’s breach of a plea agreement can
notice must have been given to Miller that the amount to plain error.” (emphasis added)).
government considered him in breach, thus 12
In addition to the disputed statements, the
giving him the opportunity to debate this issue determination that Miller obstructed justice and did
(continued...)
10
those admissions constitutes plain error that
seriously affects the fairness, integrity, or pub- The general rule in this circuit is that claims
lic reputation of judicial proceedings. This is of ineffective assistance will not be considered
especially so in Miller’s case, where he most on direct appeal “when, as here, it was not
certainly breached the agreement, and his own raised in the district court, because there has
failure to object likely led to the government’s been no opportunity to develop record evi-
not declaring this breach in the district court. dence on the merits of the claim.” United
Therefore, in contrast to cases such as Gold- States v. Lampaziana, 251 F.3d 519, 527 (5th
faden, Miller’s sentencing did not constitute Cir. 2001). Accordingly, we decline the invi-
plain error.13 tation to address Miller’s ineffective assistance
of counsel claim, and we express no opinion as
C. to its merits.
Miller avers that his counsel’s failure to ob-
ject to the application of the grouping rules D.
constituted ineffective assistance of counsel in Miller asserts that application of the sen-
violation of the Sixth Amendment. Specifi- tencing guidelines violates the Sixth Amend-
cally, in following the recommendation of the ment. This argument was initially grounded in
PSR, the court did not group the money laun- Blakely v. Washington, 124 S. Ct. 2531, 2537
dering offense with the tax evasion offense, the (2004), in which the Court ruled unconstitu-
result being a one-level upward adjustment to tional the State of Washington’s sentencing
the offense level for the money laundering scheme because it mandated the imposition of
offense. Miller did not object. sentences based on facts not reflected in the
verdict or admitted by the defendant. After
briefing and argument had been concluded in
12
(...continued) the instant case, the Court issued United States
not accept responsibility could easily have been v. Booker, 125 S. Ct. 738 (2005), explicitly
based on the government’s discovery of only one extending the fundamental holding of Blakely
safe, rather than the two Miller reported, at the to the federal sentencing guidelines and declar-
house. Add to this discrepancy the strange re-ap-
ing that their mandatory nature runs afoul of
pearance of the safe at the hands of Miller’s father-
the Sixth Amendment. Essentially, Booker
in-law, and it is further obvious that the govern-
ment was well aware something was amiss. The makes the guidelines merely advisory. See
recordings of Miller’s phone conversations, on United States v. Mares, No. 03-21035, 2005
which the probation officer relied in making his U.S. App. LEXIS 3653, at *17 (5th Cir. Mar.
recommendation in the PSR, and on which the 4, 2005).
court, in turn, explicitly relied, make certain that
there was ample evidence of Miller’s mischievous Nevertheless, the Court explicitly cautioned
scheme. that “we expect reviewing courts to apply or-
dinary prudential doctrines, determining, for
13
Given our conclusion that any breach of the example, whether the issue was raised below
cooperation agreement by the government was ei- and whether it fails the ‘plain-error’ test.”
ther justified by Miller’s own breach or was not
Booker, 125 S. Ct. at 769. Miller concedes
plain error because of the substantial amount of ad-
that this standard of review applies.
ditional evidence on which the court relied, we do
not reach the government’s contention that Miller’s
statements are not covered by § 1B1.8. Before we can reverse based on error not
11
raised at trial, there must be “‘(1) error, (2) Because Booker renders the guidelines ad-
that is plain, and (3) that affects substantial visory, if we were to remand because of an er-
rights.’” Mares, 2005 U.S. App. LEXIS ror under Booker the district court would have
3653, at *23 (quoting United States v. Cotton, the discretion to impose the same sentence by
535 U.S. 625, 631.14 The plainness or ob- giving consideration to the guidelines and the
viousness of the error is assessed by reference other factors enumerated in 18 U.S.C.
to the law as it exists at the time of appellate § 3553(a). Miller can point to nothing in the
consideration.15 Therefore, in this case, where record to demonstrate that, operating under an
the sentencing court applied the guidelines and advisory sentencing scheme, the district court
made factual findings that were neither au- would have reached a significantly different re-
thorized by the verdict nor admitted by the sult. Miller’s substantial rights, therefore, have
defendant, there is an error that is clear or not been affected, and he is unable to show
obvious under Blakely and Booker. See Cot- plain error.
ton, 535 U.S. at 632.
AFFIRMED.
The crucial question, therefore, is whether
the error affects Miller’s substantial rights. In
Mares, 2005 U.S. App. LEXIS 3653, at *27-
*28, we said that “the pertinent question is
whether [the defendant] demonstrated that the
sentencing judgeSSsentencing under an advi-
sory scheme rather than a mandatory
oneSSwould have reached a significantly
different result.” That is, the plain error stan-
dard places the
burden of proof [on the defendant] and
requires “the defendant to show that the
error actually did make a difference: if it is
equally plausible that the error worked in
favor of the defense, the defendant loses; if
the effect of the error is uncertain so that
we do not know which, if either, side it
helped the defendant loses.”
Id. (quoting United States v. Rodriguez, 398
F.3d 1291, 1300 (11th Cir. 2005)).
14
See also Olano, 507 U.S. at 732; Calverley,
37 U.S. at 162.
15
Cotton, 535 U.S. at 631-32; Johnson v.
United States, 520 U.S. 461, 467-68 (1997).
12