1 18

‐ 1155

United States v. Milne



### UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT



## SUMMARY ORDER

R ULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT

. C ITATION TO A

SUMMARY ORDER FILED ON OR AFTER J ANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY

F EDERAL R ULE OF A PPELLATE P ROCEDURE 32.1 AND THIS COURT ’ S L OCAL R ULE 32.1.1.

W HEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT

, A PARTY MUST

CITE EITHER THE F EDERAL A PPENDIX OR AN ELECTRONIC DATABASE ( WITH THE NOTATION

“ SUMMARY ORDER ”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON

ANY PARTY NOT REPRESENTED BY COUNSEL

.

At a stated term of the United States Court of Appeals for the Second

Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley

Square, in the City of New York, on the 17 th day of May, two thousand

nineteen.

PRESENT: DENNIS JACOBS,

PIERRE N. LEVAL,

CHRISTOPHER F. DRONEY,

Circuit Judges.

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ X

UNITED STATES OF AMERICA,

Appellee,

v. 18

‐ 1155

JOHN N. MILNE

, Defendant

‐ Appellant.

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ X2 FOR APPELLANT: Andrew B. Bowman, Westport, CT.

FOR APPELLEE: Elena Coronado (Michael S. McGarry,

Sandra S. Glover, Assistant United

States Attorneys, on the brief), for

John H. Durham, United States

Attorney for the District of

Connecticut, New Haven, CT.

Appeal from a judgment of the United States District Court for the District

of Connecticut (Hall, J.).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the judgment of the district court is

AFFIRMED

.

John Milne appeals from a judgment of the United States District Court for

the District of Connecticut (Hall, J.) sentencing him to 24 months’ imprisonment

following his violation of the terms of supervised release. On appeal, Milne

argues that the sentence was procedurally and substantively unreasonable. We

assume the parties’ familiarity with the underlying facts, the procedural history,

and the issues presented for review.

Milne pleaded guilty in 2009 to conspiracy to falsify the books and records

of a publicly traded company while serving as its President and Chief Financial

Officer. He was sentenced to 27 months’ imprisonment followed by 36 months

of supervised release, and the district court imposed a special condition of

supervised release, in lieu of restitution or a fine, requiring payment of $6,250,000

to the Securities and Exchange Commission (“SEC”) to satisfy a disgorgement

order that resolved a parallel SEC civil suit against Milne.

At a March 2013 hearing, Milne admitted to violating the terms of his

supervised release by failing to make required payments to the SEC and leaving

the district of his supervision without permission. However, the hearing was

continued numerous times, initially to allow Milne to provide updated financial

statements, and later to allow Milne to make good on his repeated assurances that3 he would soon be able to make sizeable payments to the SEC. Finally, after more

than five years of continuances, the district court sentenced Milne in April 2018 to

the maximum term of 24 months’ imprisonment.

1. “Sentences for violations of supervised release are reviewed under

the same standard as for sentencing generally: whether the sentence imposed is

reasonable.” United States v. Brooks, 889 F.3d 95, 100 (2d Cir. 2018) (internal

quotation marks omitted). “A district court commits procedural error where it

fails to calculate (or improperly calculates) the Sentencing Guidelines range, treats

the Sentencing Guidelines as mandatory, fails to consider the [18 U.S.C.] § 3553(a)

factors, selects a sentence based on clearly erroneous facts, or fails adequately to

explain the chosen sentence.” United States v. Robinson, 702 F.3d 22, 38 (2d Cir.

2012) (citing Gall v. United States, 552 U.S. 38, 51 (2007)). Review for

reasonableness is akin to a “deferential abuse

‐ of

‐ discretion standard.” United

States v. Cavera, 550 F.3d 180, 189 (2d Cir. 2008) (in banc) (quoting Gall, 552 U.S.

at 41). However, “[a] sentencing court’s legal application of the Guidelines is

reviewed de novo.” United States v. Desnoyers, 708 F.3d 378, 385 (2d Cir. 2013)

(internal quotation marks omitted).

Milne argues that the district court’s explanation for the sentence was

insufficient and irrational. In particular, he argues that the court erroneously

analogized his offense to armed robbery, and that the court’s explanation was

irreconcilable with its finding that Milne’s unfulfilled promises to make

substantial payments did not amount to fraud on the court.

Milne’s characterization of the district court’s analogy at sentencing is

misleading. The court indeed expressed a view that books and records fraud,

like embezzlement or robbery, can be understood as “stealing.” But the record

does not indicate that the court in any way misunderstood the nature of Milne’s

offense. The court’s statement appears to have been in response to defense

counsel’s observation that it would be “an overstatement to say he stole

money

. . . . This is not those kind of cases where you’re talking about a man

that goes into a bank and steals money.” Appx. at 57.

Milne further argues that the district court imposed the maximum sentence

in further punishment for the seriousness of the indictment offense, and that such4 additional punishment is not permissible. We reject the contention. The record

reflects that the district court adequately explained the sentence, setting forth two

key considerations, neither of which was punishment for the indictment offense.

First, the court explained the need for deterrence, both generally and for Milne

specifically. After examining in detail the factual context surrounding Milne’s

violation, the court concluded “that little deters him,” emphasizing that Milne

repeatedly promised to make substantial payments to the SEC, yet failed to do so

despite repeated warnings from the court that failure to comply with his payment

obligations could result in further imprisonment. Appx. at 94

‐ 95.

Second, the court emphasized “the nature and circumstance of his violation

of supervised release,” Appx. at 98, specifically that in the years since Milne’s

release, he had the financial means to address his payment obligations, and spent

lavishly on personal expenses. The court did not find that Milne affirmatively

lied to the court when he expressed expectations that he would soon make

payments to the SEC. At the same time, the court concluded that Milne’s pattern

of unfulfilled promises, combined with his “high lifestyle,” Appx. at 96, was a

relevant consideration in the court’s evaluation of the nature and circumstances of

Milne’s violation.

Accordingly, we see no procedural error in the sentence imposed by the

district court.

2. “Substantive reasonableness is also reviewed for abuse of discretion.”

Desnoyers, 708 F.3d at 385. “In examining the substantive reasonableness of a

sentence, we review the length of the sentence imposed to determine whether it

cannot be located within the range of permissible decisions.” United States v.

Matta, 777 F.3d 116, 124 (2d Cir. 2015) (internal quotation marks omitted). We

will “set aside a district court’s substantive determination only in exceptional

cases.” Cavera, 550 F.3d at 190 (emphasis omitted).

Milne observes that the sentencing range under the United States

Sentencing Guidelines (the “Guidelines”) for his violation of supervised release

was 3 to 9 months’ incarceration, and essentially argues that the extent of the

court’s deviation from the Guidelines range demonstrates that the sentence was

greater than necessary to comply with the 18 U.S.C. § 3553(a) factors.5 In reviewing a non

‐ Guidelines sentence, we “must give due deference to

the district court’s decision that the § 3553(a) factors, on a whole, justify the extent

of the variance.” Gall, 552 U.S. at 51. We “do not consider what weight we

would ourselves have given a particular factor. Rather, we consider whether the

factor, as explained by the district court, can bear the weight assigned it under the

totality of circumstances in the case.” Cavera, 550 F.3d at 191 (internal citation

omitted).

At sentencing, the district court carefully reviewed the factual record of

Milne’s violations, and explained that the sentence was justified by the § 3553(a)

factors

‐‐ specifically, the nature and circumstances of the violation, see 18 U.S.C.

§ 3553(a)(1), and adequate deterrence, see id. § 3553(a)(2)(B). We see no basis to

conclude that a 24

‐ month sentence was “shockingly high

. . . or otherwise

unsupportable as a matter of law” in these circumstances. See United States v.

Rigas, 583 F.3d 108, 123 (2d Cir. 2009). Accordingly, we will not disturb the

district court’s “considerable discretion in identifying the grounds that can justify

a non

‐ Guidelines sentence.” United States v. Jones, 531 F.3d 163, 172 (2d Cir.

2008).

We have considered Milne’s remaining arguments and conclude they are

without merit. The judgment of the district court is therefore AFFIRMED

.

FOR THE COURT:

CATHERINE O’HAGAN WOLFE, CLERK