2004 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

6-10-2004

USA v. Rennert

Precedential or Non-Precedential: Precedential

Docket No. 03-1511

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PRECEDENTIAL

UNITED STATES COURT OF

APPEALS FOR THE THIRD CIRCUIT

 

NO. 03-1511

 

UNITED STATES OF AMERICA

v.

PHILIP ANDRE RENNERT,

Appellant

 

NO. 03-1518

 

UNITED STATES OF AMERICA

v.

GEORGE RAYMOND JENSEN,

Appellant

 

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

Before: SLOVITER, ALITO, Circuit

Judges and OBERDORFER*, District

Judge

(Filed: June 10, 2004)

 

James H. Feldman, Jr. (Argued)

Law Offices of Alan Ellis

Ardmore, PA 19003-2276

Attorney for Appellant,

Philip Andre Rennert

Peter Goldberger

Law Office of Peter Goldberger

Ardmore, PA 19003-2276

Attorney for Appellant,

George Raymond Jensen

Christopher D. Warren (Argued)

Philadelphia, PA 19103

Attorney for Appellant,

Michael Lewis Miller

 

*Hon. Louis F. Oberdorfer, United States

District Court for the District of

Columbia, sitting by designation.
2

Patrick L. Meehan

United States Attorney

Laurie Magid

Deputy United States Attorney

for Policy and Appeals

Robert A. Zauzmer

Assistant United States Attorney

Senior Appellate Counsel

Andrea G. Foulkes(Argued)

Assistant United States Attorney

Office of United States Attorney

Philadelphia, PA 19106

Attorneys for Appellee

 

OPINION OF THE COURT

SLOVITER, Circuit Judge.

I.

Appellants Michael Miller and

Philip Rennert were convicted by a jury of

conspiracy, wire fraud, and securities

fraud; Appellant George Jensen was

convicted by a jury of securities fraud.

Their convictions resulted from their

involvement in a complex scheme under

which they leased the worthless stocks of

several public companies to the Teale

Network (“Teale”), a fraudulent network

of offshore and domestic companies. The

details of the operation of the Teale

Network, through its principal Alan Teale,

are set forth in our earlier opinion in

United States v. Yeaman, 194 F.3d 442

(3d Cir. 1999), and we repeat only such

details as are necessary to decide the issues

before us in this appeal.

In essence, Teale represented the

worthless leased stocks as valuable assets

that could be liquidated to pay claims

pursuant to reinsurance contracts entered

into with World Life and Health Insurance

Company (“World Life”), a Pennsylvania

insurance company that was already in

financial difficulty. When World Life

attempted to liquidate these assets to pay

its outstanding medical reinsurance claims,

the stocks were found to be worthless.

World Life became insolvent at

some point during or before 1988, but did

not reveal its financial difficulty to

regulators or to its insureds. In 1989 and

1990, World Life issued four group

medical policies. Teale entered into

contracts reinsuring World Life’s policies

from November 1989 to November 1990.

Pursuant to these agreements, Teale

assumed 100 percent of the liability

associated with World Life’s four group

medical insurance policies in exchange for

receipt of 92 percent of the premiums paid

by World Life’s insureds on those policies.

Appellants supplied Teale with stocks

from offshore companies that Teale could

list as putatively valuable collateral

backing the company, though the stocks

were essentially worthless. Yeaman, 194

F.3d at 447.

In 1990, Rennert created Forum

Rothmore to serve as an intermediary

between Teale and the publicly traded

corporations that desired to lease their

stock to Teale. This arrangement created

the appearance of legitimacy in two ways.

First, Forum Rothmore helped the Teale

Network comply with Pennsylvania
3

reinsurance regulations that require

unli censed offshore reinsurance

companies, such as Teale, to deposit in

escrow accounts collateral (in the form of

corporate stocks) equal to the liability

associated with its reinsurance contacts.

Second, Forum Rothmore entered into

“surplus contribution agreements” with

Teale, which gave Teale the appearance of

being bac ked by independ e n t

stockholdings. Id.

Teale and Rennert first met and

discussed thisfraudulent scheme in August

1990 and executed the first of their surplus

contribution agreements on September 1,

1990. Under the terms of these

agreements, public shell corporations

leased their stock to Teale and authorized

the sale of the stock, if necessary, to pay

claims under insurance policies that Teale

had reinsured. Teale then listed these

shares at inflated values on the financial

statements presented to World Life. After

receiving insurance premiums from World

Life, Teale paid monthly leasing fees to

Forum Rothmore, which in turn split the

fees with the stock providers. Id. The

Teale Network was Forum Rothmore’s

sole client, and Forum Rothmore was the

Teale Network’s only consistent source of

assets.

In particular, Forum Rothmore

entered into surplus contribu tion

agreements with Ecotech Corporation

(“Ecotech”). Jensen was at various times

in control of and president of Ecotech. On

December 15, 1990, Jensen manipulated

Ecotech’s stock price and then leased one

million dollars worth of Ecotech’s stock to

Teale. Although Ecotech’s shares were

virtually wo rthless, A ppell ants

fraudulently over-valued Ecotech’s shares

on the company’s financial statements.

Members of the conspiracy manipulated

the market for Ecotech and other

corporations’ stock in order to maintain

the inflated trading prices.

Miller, a lawyer, was corporate

counsel for Forum Rothmore and a

shareholder in Ecotech. The Ecotech

stock at issue was not tradeable and carried

a restrictive legend to that effect. Miller

issued opinion letters stating that Forum

Rothmore could remove that legend from

stock certificates so that it falsely appeared

that the stock could be freely traded and

leased to Teale. The Government

submitted evidence that Miller was paid

$130,208 for representing the company

and $104,000 from leasing Ecotech stock

to Teale.

In 1991, the Pennsylvania Insurance

Department discovered World Life’s

insolvency and ordered its liquidation.

Because Teale had been paying insurance

claims with recently-received premiums

and had no other significant assets to draw

upon, this liquidation deprived Teale of the

ability to pay further insurance claims.

World Life’s policyholders thus were

unable to receive insurance payments as

needed.

Following World Life’s liquidation,

the Pennsylvania Life and Health

Insurance Guarantee Fund, a state fund

through which Pennsylvania insurance

companies pay the outstanding liabilities
4

o f insolv ent c arriers, provided

approximately $6.4 million for group

medical reinsurance claims left unpaid as

a result of the fraud.

II.

Appellants were indicted on

February 6, 1996 and were convicted by a

jury on April 16, 1997. At the sentencing

hearing held January 22, 1998, the District

Court assigned each Appellant a one-point

upward departure for loss of confidence in

an important institution, but found no

monetary loss attributable to the

Appellants because World Life was

insolvent at the time it entered into

reinsurance contracts with Teale. The

District Court also rejected the application

of additional sentencing enhancements for

use of special skills and substantially

jeopardizing a financial institution. 

Appellants appealed their individual

verdicts and sentencing calculations to this

court in 1998 and we set out the full

factual and procedural history of their

cases in prior 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);

and United States v. Miller, Nos. 98-1147

& 98-1103, slip op. (3d Cir. Oct. 15,

1999). Appellants challenged the District

Court’s instructions to the jury, the

sufficiency of the evidence supporting

their convictions, and the upward

adjustment for loss of confidence in an

important institution. The Government

cross-appealed, arguing that the District

Court had erred in finding that there was

no loss caused by the fraud, in failing to

increase Miller’s offense level because he

had used special (legal) skills in

furtherance of the conspiracy, and in

failing to increase all Appellants’ offense

levels for causing a substantial effect on a

financial institution.

In Miller, we rejected Miller’s

argument that he acted “only as an

attorney.” Instead, we held that Miller’s

involvement went “beyond the role of

legal representation” and could not “be

categorized as simple legal advice,”

especially given Miller’s ownership of

Ecotech stock and his letters regarding

removal of restrictive legends. Miller, slip

op. at 6. In Rennert and Jensen, we also

upheld Rennert and Jensen’s convictions

and affirmed the imposition of a one-point

upward departure based on loss of

confidence to an important institution.

However, we remanded all three cases for

re-sentencing to consider 1) whether there

was a causal connection between the

Appellants’ misrepresentations and the

fraud loss caused by Teale’s collection of

premiums, and 2) in Miller’s case, whether

an enhancement would be appropriate for

Miller’s use of special (legal) skills. With

respect to fraud loss, we clarified that the

fraud loss calculation should be based on

the dates of Appellants’ agreement to the

conspiracy, rather than the dates of their

misrepresentations. Also, in a related case,

we suggested that the loss calculation

might be based on the net gain to Teale or

the balance of unpaid claims. See

Yeaman, 194 F.3d at 458-59 (involving
5

another co-defendant in the conspiracy

who is not a party to the instant appeal).1

On February 3, 2003, the District

Court held a re-sentencing hearing for

Miller, Jensen, and Rennert. 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 coconspirators and that the extent of the total

loss caused by the fraud was not

foreseeable to him. In particular, Miller

attempted to contest the Government’s

arguments that he was present at the

August 1990 Teale-Rennert meeting, that

he prepared opinion letters in support of

the conspiracy, that he received payments

for services as a stock provider, and that he

falsified records bearing the date of

Ecotech’s merger with a gold mine to

create additional stock shares for Teale.

The District Court declined to permit

Miller to submit additional evidence that

was not already presented at trial because

the issue was “subsumed” by the jury’s

verdict and was therefore immaterial to

sentencing. See App. at 350-53 (finding

Miller’s factual allegations were “matters

of defense for the trial, not for

sentencing”).

On the issue of fraud loss causation,

the Government presented two witnesses,

a representative from the Liquidations and

Rehabilitation Section of the Pennsylvania

Department of Insurance and a general

counsel to a third-party administrator.

They stated that, had their organizations

known that Appellants’ assets were

worthless, they would have halted the flow

of premiums months earlier and forced

World Life to obtain a solvent reinsurer.

On February 13, 2003, the District

Court issued a sentencing opinion

concluding that Miller, Rennert, and

Jensen entered into an agreement

conspiring to defraud World Life and its

policyholders no later than August 30,

1990. The District Court held that the total

fraud loss caused by the Appellants was

approximately $3.2 million: the difference

between the total premiums paid to Teale

minus the claims paid by Teale to World

Life’s policyholders. The District Court

further found that there was “a causal

connection between the misrepresentations

of the Defendants and the continued

payment of premiums to World Life . . .

and the Defendants.” App. at 12-13.

Finally, the District Court increased

Miller’s sentence based on his use of

special skills and more than minimal

planning. The Appellants also received

upward departures for causing the loss of

confidence in an important institution (the

stock market). The District Court

sentenced Miller to 51 months, Rennert to

63 months, and Jensen to 30 months of

imprisonment.

All three Appellants contest the

District Court’s factual finding of a causal

connecti o n between thei r

 

1

 Yeaman again appealed to this court

in United States v. Yeaman, 248 F.3d 223

(3d Cir. 2001), and we remanded for resentencing. He was re-sentenced on

February 5, 2003 and did not appeal.
6

misrepresentations and the fraud loss to

the victims of $3.2 million. Miller

challenges the District Court’s order

barring him from submitting additional

testimony and documents to demonstrate

the “limited” scope of his involvement in

the conspiracy. We will affirm.

III.

The District Court had jurisdiction

under 18 U.S.C. § 3231 and this court has

jurisdiction over the appeal pursuant to 28

U.S.C. § 1291 and 18 U.S.C. § 3742. We

review the DistrictCourt’s factual findings

for clear error. United States v. Weaver,

267 F.3d 231, 235 (3d Cir. 2001). We

review the District Court’s decision to

admit or deny evidence for abuse of

discretion. United States v. Serafini, 233

F.3d 758, 768 n.14 (3d Cir. 2000).

A. Fraud Loss Causation

Appellants assert two primary

challenges to the District Court’s finding

that their conspiracy caused approximately

$3.2 million in fraud loss. First, all

Appellants argue that the District Court

e rrone ously fou nd th at t heir

misrepresentations of stock values actually

caused Teale to continue receiving

premiums from World Life policyholders

by preventing the Pennsylvania

Department of Insurance from discovering

the fraud and halting the flow of

premiums. This is one of the issues we

directed the District Court to consider on

remand. Second, Rennert contends that

even if the District Court were correct that

the Pennsylvania Department of Insurance

would have stopped the flow of insurance

premiums to Teale Network if it had

known Appellants were over-valuing

stock, Rennert only should have been held

liable for the approximately $1.3 million in

losses that occurred on or after December

29, 1990, rather than counting losses

beginning in September 1990. Because

this lower fraud loss amount would have

reduced Rennert’s sentence, he argues that

a remand for re-sentencing is required.

1. Rela tionsh ip Between

Appe llants ’

Misrepresentation of Stock

Values and World Life’s

Continued Payment of

Premiums

Appellants contend that the victim,

World Life, did not rely on their

misrepresentations of stock assets as

valua ble and theref ore the ir

misrepresentations did not cause the fraud

loss. Moreover, they contend that it was

World Life’s own obstruction of the

investigation by the Pennsylvania

Department of Insurance – not their

misrepresentations – that prevented the

Department from discovering the fraud

and immediately halting the flow of

premiums to Teale. Appellants thus argue

that the District Court committed clear

error. The Government responds that

World Life and its policyholders paid

Teale millions of dollars for reinsurance in

reliance on the Appellants’ fraudulent

representations that their stocks were

valuable and redeemable as assets, as they

purported.

We have addressed the issue of
7

fraud loss causation in connection with the

Teale conspiracy in Yeaman, where we

stated, “[w]ithout the assets of the

defendants and the resulting appearance of

solvency, the most reasonable inference is

that World Life would have ceased paying

premiums to Teale long before it

eventually did.” Yeaman, 194 F.3d at 458.

We explained the causality analysis as

follows:

Teale could not have

entered and remained in the

business of reinsuring

World Life but for its

fraudul e n t

misrepr esentat ions .

Although the District Court

made no finding on the issue

[before], the record would

also appear to us to support

the proposition that World

Life was not capable of

insuring any of the four

group medical policies

without having received a

commitment for 100%

reinsurance. It follows that

if the Teale fraudulent

reinsurance contracts had

not been available, World

Life would either have

secured other reinsurance or

would not have issued the

group policies involved. If

reinsurance from a solvent

reinsurer had been obtained,

all claims under the policies

would have been paid to the

reinsurer; if the group

policies had not been issued,

t h e e mpl o y e rs wh o

purchased the policies from

World Life would have

obtained group medical

coverage from another

source and all claims of the

beneficiaries would have

been paid in full. In either

event . . . there would have

been a causal nexus between

the fraud and all unpaid

claims.

Id. at 459. In short, we found that the

most reasonable inference is that World

Life relied on the A ppella nts’

misrepresentations about the value of their

stock assets when it paid Teale additional

premiums. 

On remand, the District Court

concluded that there was “a causal

connection between the misrepresentations

of the Defendants and the continued

payment of premiums to World Life, and

. . . Teale and the Defendants.” App. at

12, 34. In particular, the District Court

made the following findings:

-Had the true value of the

Defendants’ stocks been

known, at the very least, the

Pennsylvania Department of

Insurance would have

stopped the payment of

premiums to the Teale

Network.

-In addition, because World
8

Life was insolvent,

had the reinsurance

c o ntr acts bee n

termin ated , th e

company would have

been liquidated much

sooner than it was,

and the policyholders

would have never

made those premium

payments at all.

App. at 13, 35.

Although Appellants argue that the

District Court’s findings do not answer the

questi o n of whe ther th e i r

misrepresentations caused the fraud loss, it

is apparent that the Department of

Insurance did not intercede because it did

not know “the true value of the

[Appellants’] stocks.” App. at 13. That

lack of knowledge was the result of

Appellants’ misrepresentations of the

value of those stocks. This, in turn, caused

the Department of Insurance to permit

World Life’s continued operation and

caused World Life to continue providing

Teale insurance premiums in reliance on

Appellants’ misrepresentations.

Appellants’ attempt to sever the

connecti o n between thei r

misrepresentations and the Department of

Insurance’s delayed intervention is

unpersuasive.2

Appellants next challenge the

sufficiency of the evidence supporting the

District Court’s finding that the flow of

insurance premiums would have been

halted but for their misrepresentations. At

the Appellants’ re-sentencing hearing, two

Government witnesses testified that but for

Appellants’ misrepresentations about the

value of the stock assets Teale claimed as

collateral, World Life would not have

continued paying its policyholders’

premiums to Teale – that is, the

Department of Insurance or various

policyholders would have halted the flow

of premiums if they had known the true

value of Appellants’ stocks. One witness,

the Director of Liquidations and

Rehabilitation for the Pennsylvania

Department of Insurance, testified that the

Department could have halted the flow of

insurance payments had it known that

Appellants’ assets were worthless.3

 

2

 Appellants suggest that Teale’s

insolvency would not have provided

World Life with automatic grounds to

terminate its relationship with Teale

because their reinsurance contract did not

provide for termination based on Teale’s

insolvency. We do not accept this

argument. If Teale were insolvent, it no

longer could meet its contractual

obligations to provide reinsurance to

World Life. Because Appellants have

identified no contract provision requiring

World Life to continue providing

premiums after Teale has materially

breached their contract, we have no reason

to assume that World Life would be bound

to continue honoring a contract that Teale

had breached.

 

3

 Appellants emphasize that the

Insurance Director stated that the
9

Because Appellants fraud ulentl y

misrepresented their assets’ value and

made it appear that Teale was solvent,

however, the Department was not

authorized to intervene.

4

Similarly, the general counsel to a

third-party insurance administrator

testified that he recommended that World

Life partner with Teale based, in part, on

Appellants’ misrepresentations of the

value of their assets based on the

manipulated market prices. The general

counsel analyzed the Appellants’

fraudulent market valuations of their assets

and inferred that the Teale Network was a

legitimate, solvent business based on those

representations. He further testified that if

he had known that the stocks backing

Teale were worthless, he would have

removed his company’s group policies and

reinvested them with a solvent carrier.

We come then to Appellants’

argument that it was World Life’s failure

to cooperate with the Pennsylvania

Department of Insurance – not Appellants’

misrepresentations – that delayed the

discovery of Teale’s fraud. But the fraud

victim’s negligence or lack of diligence in

uncovering the fraud is not a defense.

United States v. Coyle, 63 F.3d 1239, 1244

(3d Cir. 1995) (“The negligence of the

victim in failing to discover a fraudulent

scheme is not a defense to criminal

conduct.”) (citations omitted); see also

United States v. Bennett, 9 F.Supp. 2d

513, 523 (E.D. Pa. 1998) (“Taking

advantage of a victim’s self-interest does

not mitigate the seriousness of fraudulent

conduct.”) (quotations and citations

omitted). Nor do the Appellants cite any

case law suggesting that courts may not

find fraud loss causation where the victim

has not immediately assisted the

authorities in investigating the fraud.

In addition, the Government

properly notes that even assuming that

Department “could . . . have acted months

sooner . . . to stop the flow of premiums,”

App. at 386-87, but did not state that it

would have done so. The District Court

did not clearly err in concluding that the

Department would have acted if it had

known the true value of the assets

Appellants misrepresented, given its later

investigation and liquidation of World

Life. We also reject Appellants’ argument

that the Department could not have

stopped World Life from continuing to

provide Teale with premiums “months

sooner” based on administrative hurdles to

the investigatory and liquidation processes.

The District Court did not err in crediting

the Director’s statement that it could have

mobilized its administration to act quickly.

 

4

 Appellants suggest that the

Department of Insurance did not begin

investigating World Life until January

1991 and therefore Ap pellan ts’

misrepresentations had no effect prior to

that date. This argument assumes that the

Department would not have begun

investigating World Life if it were known

that its reinsurer, Teale, lacked collateral

assets as of 1990. This argument is

without support and is directly contrary to

the Director’s testimony.
10

World Life could be held to be

contributorily negligent, such an argument

ignores our prior finding that the fraud

victims also included World Life

policyholders, who could not be

reimbursed for their medical costs until the

Commonwealth’s bail-out. Yeaman, 194

F.3d at 458. Nothing in the record

suggests that the policyholders acted

negligently or that they should have been

expected to be suspicious of the true value

of its reinsurance agent’s assets.

In light of the evidence from the

trial as well as the re-sentencing hearing,

the District Court did not clearly err in

finding a causal connection between the

Appellants’ misrepresentations and the

losses incurred by World Life and its

policyholders.

2. Rennert’s Sentence and the

Beginning Date of the Fraud

Rennert also argues that the District

Court should have calculated the fraud loss

for the period after December 1990

because the Department of Insurance

Director stated that had it known of the

true value of Appellants’ stocks in

December 1990, it would have halted the

flow of premiums. Rennert did not assert

this alternative loss calculation during the

District Court’s sentencing hearing and,

thus, has waived the argument. See United

States v. Bethancourt, 65 F.3d 1074, 1082

(3d Cir. 1995).

B. Miller’s Claim Regarding the Scope of

His Involvement

1. Relevant Conduct

In his separate appeal, Miller

asserts that the District Court erroneously

conflated the jury’s “general” conspiracy

conviction with the court’s conclusion that

Miller should be held liable for all losses

related to the conspiracy under the relevant

conduct provision of the United States

Sentencing Guidelines, U.S.S.G. § 1B1.3.

Miller contends that even if a defendant

has been convicted of a conspiracy charge,

the trial court must make particularized

findings as to the scope of each

conspirator’s involvement in order to

increase the conspirator’s sentence under

Section 1B1.3. 

Under the Sentencing Guidelines, a

defendant’s offense level is subject to

increase depending on the amount of loss

caused by the fraud. Section 1B1.3(a)

provides that the district court should

adjust the specific offense level by taking

into account all conduct relevant to the

offense. U.S.S.G. § 1B1.3(a). This

includes “all reasonably foreseeable acts

and omissions of others in furtherance of

[a] jointly undertaken criminal activity.”

U.S.S.G. § 1B1.3(a)(1)(B).

Miller asserts that United States v.

Collado, 975 F.2d 985 (3d Cir. 1992),

requires that we remand this case in light

of the District Court’s lack of findings as

to the precise scope and timing of his

agreement to join the conspiracy.5 In

 

5

 Miller also cites United States v.

Studley, 47 F.3d 569 (2d Cir. 1995).

However, Studley is not a binding

precedent on this court and we have made
11

Collado, we stated that the district court

must consider whether the loss resulting

from the actions of co-conspirators was 1)

“in furtherance of the . . . jointlyundertaken . . . activity,” 2) within “the

scope of the defendant’s agreements,” and

3) “reasonably foreseeable in connection

with the criminal activity the defendant

agreed to undertake.” 975 F.3d at 995

(citing U.S.S.G. § 1B1.3, application note

1); see also United States v. Duliga, 204

F.3d 97, 100 (3d Cir. 2000). We held that

the relevant conduct provision depends

upon each defendant’s role in the

conspiracy and stated that courts must

conduct “a searching and individualized

inquiry into the circumstances surrounding

each defendant’s involvement in the

conspiracy” in order to “ensure that the

defendant’s sentence accurately reflects

his or her role” in the conspiracy. Collado,

975 F.3d at 995. We added that district

courts also should consider other factors,

such as whether the defendant profited or

assisted others in the conspiracy. Id. at

991-94. We further clarified that a

conspiracy conviction does not obviate the

need for analysis under the relevant

conduct provision. Id. at 993, 997.

Collado dealt with the liability of

two brothers involved in a larger drug

conspiracy. The district court had not

made any factual findings as to the scope

of the brothers’ involvement in the

conspiracy or in each other’s transactions,

but instead only adopted the findings of

the presentence report in attributing to

each of them the drug quantity from the

conspiracy. Although we required

individualized inquiry, we did not impose

an immutable requirement that the district

court hold extensive hearings to make

explicit, particularized findings as to the

exact date on which each defendant

committed to the conspiracy or the precise

contours of each conspirator’s agreement.

We instead employed a more flexible

approach. We remanded the case to the

district court to determine when the

defendants had joined the larger

conspiracy because the district court had

made no finding on the issue and the

record was not clear on this issue.

Critically, however, we also

affirmed the district court’s attribution to

one brother the amounts the other brother

supplied to the conspiracy. We affirmed

this finding based on our review of the

record, despite the district court’s lack of

explicit findings on this issue. Because the

record was clear on its face, the district

court’s lack of particularized findings was

not dispositive. We instead concluded that

the district court’s accomplice attribution

conclusion between the brothers was

supported by the record evidence of their

awareness of and assistance to each other

in drug transactions. See id. at 997.

More recently, in Duliga, we

reaffirmed the proposition that even absent

explicit findings on the precise scope of a

defendant’s involvement, a district court’s

clear that the resolution of such issues is

governed by this Court’s decision in

Collado. United States v. Duliga, 204 F.3d

97, 101 n.1 (3d Cir. 2000). Accordingly,

our analysis focuses on Collado. 
12

decision may be affirmed if it is adequately

supported by the trial court record. 204

F.3d at 101 n.2. Although the district

court in that case “did not necessarily

undertake a searching and individualized

inquiry before attributing the entire

amount of [fraud] loss . . . to Duliga,” we

affirmed without remanding because we

were convinced that the attribution of the

fraud loss was “firmly supported by the

record.” Id.

Here, the record evidence suffices

to support the conclusion that Miller had

agreed to the conspiracy by at least August

1990 and should be held liable for the full

amount of loss caused by the conspiracy.

In contrast to Collado’s under-developed

record, the record in this case included

Miller’s opinion letters on fraudulent stock

transactions, his demand letters to protect

artificially inflated stock quotes, and his

letters advising the removal of restrictive

stock certificate legends so that nonmarketable shares would appear to be

tradeable. Miller played a critical role,

enabling the conspiracy to function and

providing it an imprimatur of legitimacy.

The record evidence of Miller’s extensive

involvement in the conspiracy supports the

District Court’s application of the relevant

conduct provision.6 As with Duliga, “we

see no reason to remand the case only to

have the district court reach the same

sentencing decision.” 204 F.3d at 101 n.2.

2. Evidentiary Issues

Miller also contends that the

District Court abused its discretion by

denying his request to submit additional

evidence that allegedly would have had a

direct bearing on the scope and timing of

his involvement in the conspiracy and his

inability to foresee the total fraud loss

caused by the conspiracy. In particular,

Miller attempted to submit evidence to

dispute 1) his presence at the first meeting

between Rennert and Teale in August

1990 (the time at which the Government

suggested that Miller joined the

conspiracy); 2) Forum Rothmore’s

designation of payments to Miller as legal

fees or leasing fees in its financial records;

and 3) the timing of Miller’s first

discussion with the owners of the gold

mine corporation (with which Ecotech

merged) about receiving Ecotech stock in

order to bolster Ecotech’s financial

statements. Because the District Court

found that the issue of foreseeability was

subsumed in the jury verdict, it stated that

it would not permit Miller to re-try an

issue that the jury had already determined.

We consider each piece of Miller’s

evidence below.

Even assuming Miller was not

present at Rennert and Teale’s August

1990 meeting, several of Miller’s other

actions evidence his involvement in the

conspiracy by August 1990. For example,

in June 1990, two months before the

 

6

 Because we rely on the record

evidence of Miller’s agreement and

complicity, we need not reach Miller’s

claim that the District Court may have

improperly conflated the jury’s conspiracy

verdict with a finding of full liability under

the relevant conduct provision.
13

Rennert-Teale meeting, Miller provided

Rennert with an opinion letter to support

Forum Rothmore’s practice of leasing

worthless assets. On July 13, 1990, Miller

authored an opinion letter recommending

the re-issue of the restricted Ecotech stock

held by Jensen, Rennert, and Miller

without a restrictive legend. This made it

appear that Forum Rothmore could

provide Teale with millions of marketable

shares. In an August 28, 1990 letter, one

week after the Rennert-Teale meeting,

Miller wrote to Teale expressing his

interest and commitment to what he

termed the “credit enhancement program”

that forms the basis of the fraud charges

against the defendants, along with a $25

million offer of stocks from Ecotech and

other corporations. Supp. App. at 638-47.

Regardless of whether he was present at

the Rennert-Teale meeting, the remainder

of Miller’s actions strongly support the

District Court’s conclusion that he had

joined the conspiracy by or before August

1990.

Miller responds that he undertook

the aforementioned actions “in good

faith.” Miller Reply Br. at 8-9. Yet, the

cumulativ e effect of M iller’s

aforementioned actions (the June opinion

letter, the July letter recommending reissue of stock, and the August letter to

Teale) suggests that Miller was too central

to the operation to believe naïvely that he

and his associates were all within the

bounds of the law. Based on the record

evidence, Miller’s explanation is not

credible and the District Court did not

abuse its discretion in rejecting Miller’s

attempt to submit evidence regarding his

presence at the Rennert-Teale meeting.

Miller also attempted to submit

evidence from his personal records and

journals that he contended showed that he

was not paid to provide stock to Forum

Rothmore with knowledge of his codefendants’ fraudulent activities, but only

received legal fees and a loan. Miller

emphasizes that Forum Rothmore’s faulty

a ccountin g system imp roperl y

denominated his payments as stock

provider fees, rather than traditional

payments for legal fees.

As the Government points out, the

designation of Forum Rothmore’s

payments as “leasing fees” or “legal fees”

is inconsequential because the payment

was made in exchange for Miller’s

services in advancing a fraudulent scheme.

Because Miller does not contest the

District Court’s finding that he used his

legal skills in furtherance of the fraud, the

fact of payment for fraudulent services is

the critical point while the form of his

payment is irrelevant. Moreover, as we

noted in Miller, Miller’s services could not

“be categorized as simple legal advice.”

Miller, slip op. at 7.

Although Miller responds that he

was acting in good faith when he rendered

the legal services for which he received

remuneration and was not aware that his

legal services were being misused for a

criminal conspiracy, the record does not

support his contention. We also note that

Miller’s argument that Forum Rothmore

only paid him for good-faith legal services,
rather than fraudulent stock-leasing

activities, goes to whether or not he acted

in furtherance of the conspiracy. The

jury’s verdict shows that it decided that

issue adversely to Miller. Despite Miller’s

insistence that his new evidence only

pertained to the timing or scope of his

commitment, Miller also attempted to

argue that he was entitled to submit

evidence to attempt to nullify the jury’s

conspiracy connection, especially in his

earlier pleadings. We emphasize that

Collado does not entitle a defendant to relitigate his or her guilt or innocence and

thus, the issue of whether he was paid to

fraudulently provide stock is not the

subject of a Collado analysis.

Lastly, Miller attempted to submit

evidence to counter the Government’s

allegation that he falsified records to

deceive his accountant and regulatory

authorities regarding the value and

marketability of Ecotech’s assets. In

particular, Miller states that in September

and October of 1991 or earlier, he

discussed providing restricted, nonmarketable Ecotech stock to the gold mine

corporation with which Ecotech merged.

As such, Miller suggests that he should

only be accountable for losses incurred

after fall 1991, but not before.

Even if Miller did not falsify

records until late 1991, there were still

enough other indicia of his involvement in

1990, discussed above, to support the

conclusion that he already had committed

to the conspiracy in 1990, regardless of

whether he committed additional frauds in

connection with Ecotech’s merger with the

gold mine corporation. In sum, even

assuming that Miller would have been

permitted to submit his proffered evidence,

Miller’s evidence would not have been

sufficient to undermine the basis in the

record for imposing accomplice liability.

We hold the District Court did not abuse

its discretion in denying Miller’s proffer of

the evidence.

IV.

We will affirm the judgment of the

District Court for the reasons set forth.