United States v. Milo , 506 F.3d 71 ( 2007 )

United States Court of Appeals
For the First Circuit
No. 06-2185
UNITED STATES OF AMERICA,
Appellant,
v.
GARY JAMES MILO,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Nancy Gertner, U.S. District Judge]
Before
Boudin, Chief Judge,
Torruella and Dyk,* Circuit Judges.
Jennifer Hay Zacks, Assistant United States Attorney, with
whom Michael J. Sullivan, United States Attorney, was on brief for
appellant.
Robert L. Sheketoff for appellee.
October 30, 2007
*
Of the Federal Circuit, sitting by designation.
BOUDIN, Chief Judge. This is an appeal by the government
contesting the sentence imposed by the district court on Gary Milo.
Milo was arrested in 2003 for trafficking in marijuana. He
thereafter agreed to plead guilty and assist the government in
pending investigations. The government in turn agreed, subject to
getting substantial cooperation, to file a motion for a reduced
guideline sentence, U.S.S.G. § 5K1.1, and a sentence below the
mandatory minimum, 18 U.S.C. § 3553(e) (2000).
On April 29, 2004, Milo pled guilty to a sealed one-count
information alleging conspiracy to possess with intent to
distribute and to distribute marijuana in violation of 21 U.S.C. §
846 (2000). The information described Milo's role in heading a
large-scale marijuana distribution operation in Massachusetts,
spanning four years and involving "1,000 kilograms or more" of
marijuana. Forfeiture of Milo's proceeds from the operation was
sought as well. 21 U.S.C. § 853.
As is common in such cases, sentencing was deferred while
Milo assisted investigators. In May 2006, the cooperation having
been completed, the probation officer prepared the pre-sentence
report, and the government filed its promised motion. The PSR
found Milo accountable for over 6,000 kilos of marijuana; it found
that the conspiracy had been an extensive one involving five or
more participants; and it found that Milo himself had directed at
least two individuals to transport marijuana or drug proceeds. It
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also noted that while under supervision Milo had tested positive
for cocaine on one occasion.
Milo, born in 1955, was described in the PSR as having
been brought up in an upper middle class home, although it said
that he had suffered some abuse. He was married, had attended but
not graduated from college and had learned building design from his
father. He had a builder's license and a realtor's license and had
worked in both fields and estimated his income (apart from drugs)
at $50,000 a year. His estimated net worth slightly exceeded $2.5
million.
The PSR calculated the mandatory minimum sentence as 10
years, 21 U.S.C. § 841(b)(1)(A)(vii), and the guidelines range as
151 to 188 months. The calculation reflected a base offense level
of 34 premised on the 6,000 kilos and no prior criminal history.
An upward three-level adjustment for role in the offense matched an
equal reduction for acceptance of responsibility. U.S.S.G. §§
3B1.1(b), 3E1.1. Milo objected that the kilo amount was
overstated; the probation officer said that it did not affect the
calculation.
In its promised motion, the government described Milo's
cooperation in a number of different investigations. The
government moved both for relief from the mandatory minimum, 18
U.S.C. § 3553(e), and from the otherwise applicable guideline
sentence, U.S.S.G. § 5K1.1, and proposed to recommend a sentence of
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75 months, approximately half of the guideline minimum as
calculated by the probation officer.
Letters were submitted by those who knew Milo. They
described him (with detailed examples) as a caring and decent
person, helpful to others; set forth his work since his arrest for
Habitat for Humanity and other charitable endeavors; attested to
his contrition; expressed confidence that he would never repeat his
crime; and, in many cases, expressed hope that he would not have to
serve time in prison.
At sentencing, Milo's experienced counsel said he had
seen few examples of such complete remorse and urged that Milo be
given no time in prison. The prosecutor agreed that Milo had done
"a great job" and helped the government "in significant and
important ways." But, she said, Milo had brought thousands of
pounds of marijuana into the district over a number of years, and
75 months was a "generous" reduction from the ordinary guideline
sentence.
After Milo spoke, expressing contrition and saying that
he had sought to turn his life around, the district court said that
it would accept defense counsel's recommendation. The judge
referred without elaboration to Milo's "extraordinary" cooperation
and the force of the letters in the record and said that the 18
days already spent by Milo in detention and the prospect of a very
large forfeiture yet to be computed counted as punishment.
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The court then sentenced Milo to time served, five years
of supervised release with the first six months to be served in a
community corrections facility, and a fine of $50,000. Thereafter,
in denying a government motion for reconsideration, the district
court rejected any suggestion that the government should have been
surprised by the sentence and elaborated on what the court said was
already in the record before the sentencing hearing:
The sentencing concerned the extraordinary
nature of Mr. Milo's cooperation as described
in the government's presentation. But it also
concerned the extent to which Mr. Milo had
changed his life, the steps he had taken in
his work, steps which effectively increased
the amount of money the government was likely
to recover on forfeiture, and his exemplary
work with Habitat for Humanity.
In discussing the government's objections, the court said
that the Milo sentencing was about contrition as well as
cooperation; that many defendants bargain and cooperate as a kind
of "business arrangement" but that Milo was genuinely remorseful
and "had changed his life (addressing his addictions, working for
Habitat for Humanity, etc.)." The court referred briefly to the
large forfeiture judgment expected. It agreed with defense counsel
that Milo was "someone who the Court will never see again."
The government has now appealed to this court, arguing
primarily that the sentence is unreasonably low: specifically, that
"the district court sentenced a major marijuana dealer to time-
served . . . an 18-day term of imprisonment" even though Milo
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participated in an extensive four-year drug conspiracy yielding him
almost $10 million. The government also attacks various of the
district court's statements in support of the sentence as without
support or resting upon factors not properly considered.
We review sentences primarily for reasonableness, United
States v. Booker, 543 U.S. 220, 261 (2005), asking whether the
district court offered "a plausible explanation" and reached "a
defensible overall result." United States v. Jimenez-Beltre, 440
F.3d 514, 519 (1st Cir. 2006) (en banc), cert. denied, 127 S. Ct.
928 (2007). Embedded factual findings in the sentencing
determination are reviewed for clear error, United States v. Misla-
Aldarondo, 478 F.3d 52, 70 (1st Cir.), cert. denied sub nom.,
Aldarondo v. United States, ___ S. Ct. ___, 2007 WL 1647161 (Oct.
1, 2007), while claims of strictly legal error are reviewed de
novo. United States v. Smith, 445 F.3d 1, 4 (1st Cir. 2006).1
The government says that it is of no moment whether the
proper guideline sentencing range was 87-108 (as the district court
said) or 151-188 (as the PSR found).2 Either range calls for a
1
The Supreme Court's recent decision in Rita v. United States,
127 S. Ct. 2456 (2007) (holding that a presumption of
reasonableness may be accorded to a sentence within the guidelines
range) has no bearing on this case. Two cases are currently
pending in the Supreme Court involving appellate review of district
court departures from the Sentencing Guidelines. Gall v. United
States, No. 06-7949 (argued October 2, 2007); Kimbrough v. United
States, No. 06-6330 (argued October 2, 2007).
2
The PSR calculated a total offense level of 34 based in part
on Milo's distribution of between 3,000 and 10,000 kilos of
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multi-year sentence and, without a motion, the statutory mandatory
minimum would be 10 years; the sentence imposed amounts to almost
no time in prison. The main question posed by the government's
appeal is the adequacy, given circumstances and the court's
explanation, of such a sentence for a major drug crime that is
ordinarily heavily punished by a sentence of 10 to 15 years.
Three subsidiary government arguments warrant brief
attention. The first is that the district court improperly relied
on the large forfeiture order (ultimately $9.9 million), which by
statute must be imposed "in addition to any other sentence
imposed." 21 U.S.C. § 853(a) (emphasis added); see also 18 U.S.C.
§ 3554. But the statute does not say that the forfeiture can never
be considered by the district court in determining the overall
sentence, and here the forfeiture was calculated on estimated
proceeds (not profits) and so has punitive characteristics.
At the same time, one could hardly give the forfeiture in
this case much weight. Given his net worth of $2.5 million, Milo
may never be able to pay the full forfeiture. And if Milo had
independent means, avoiding a prison sentence on this account would
create an appearance that financially successful criminals can buy
marijuana. U.S.S.G. § 2D1.1(c)(3). Apparently because Milo only
admitted in the plea agreement to "over 1,000 kilograms" of
marijuana, the court set the offense level at sentencing as 32,
U.S.S.G. § 2D1.1(c)(4), yielding a range of 121-151 months. Then,
the court used level 29, equating to a range of 87-108. The
written judgment seemingly arrived at 29 by ignoring the three-
level enhancement for role in the offense.
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their way out of prison. See United States v. Mueffelman, 470 F.3d
33, 40 (1st Cir. 2006); cf. United States v. Tom, ___ F.3d ___,
2007 WL 2822908 at *5-6 (1st Cir. Oct. 1, 2007). The district
court did not rely heavily on the forfeiture, mentioning it only
briefly, and we see no error in the district court's apparent
decision to afford some minor weight to it.
Second, the government argues that the district court
gave undue emphasis to Milo's charitable activities. These are a
discouraged factor under the Sentencing Guidelines which provide:
"Military, civic, charitable, or public service; employment-related
contributions; and similar prior good works are not ordinarily
relevant in determining whether a departure is warranted."
U.S.S.G. § 5H1.11. The government does not claim this reliance to
be impermissible but merely to contribute to the unreasonableness
of Milo's sentence.
Again, the district court did not place much weight on
these activities to justify by themselves a lower sentence.
Rather, the activities (which began after Milo's arrest and were
real but not extraordinary) appear mainly to have bolstered the
court's judgment that Milo had turned his life around, was
genuinely and not just conveniently contrite and would not re-
offend. This is perhaps an evidentiary use of post-arrest good
works to show rehabilitation and colorably a legitimate inference,
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if not overdone.3 We are not convinced that reliance on this
factor was overdone here.
Third, the government suggests that Milo's episode of
cocaine use in 2005 undermines the district court's finding that he
was truly contrite and would not re-offend. We agree that the
cocaine use weighs against the finding that Milo had cleaned up his
act; but the court's finding seemingly rested on Milo's overall
behavior, his charitable works, the supporting letters, and the
impression made by Milo in his elocution. The finding that Milo is
unlikely to re-offend by drug dealing is not clearly erroneous.
See United States v. Robinson, 433 F.3d 31, 38 (1st Cir. 2005).
So we are brought back to the central question of the
reasonableness of the sentence, now narrowed to focus on the two
points most stressed by the district court: contrition and
cooperation. They present quite different problems. The district
court laid the most stress on contrition, including the
unlikelihood of re-offense.4 We accept the finding that Milo's
3
Previous decisions have said that little weight should be
given to the charitable contributions of business leaders who "are
often expected, by virtue of their positions, to engage in civic
and charitable activities." United States v. Thurston, 358 F.3d
51, 80 (1st Cir. 2004); see also United States v. Cooper, 394 F.3d
172, 176-77 (3d Cir. 2005).
4
The government notes our opinion in United States v. Ahlers,
305 F.3d 54, 60 (1st Cir. 2002), holding that a district court may
consider only a defendant's substantial assistance when imposing a
sentence below the statutory minimum pursuant to the government's
section 3553(e) motion. However, the government says it "is not
pressing this issue on appeal," because Milo would be entitled to
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contrition was real: the issue is how far this warrants a very
large reduction in sentence.
Milo received a three-level adjustment for acceptance of
responsibility. The government says that therefore the law has
already "to some extent" given him credit for contrition and that
to wipe out the rest of his sentence on this ground underscores the
unreasonableness of the sentence. But in practice over 90 percent
of drug traffickers who plead guilty get a two or three level
adjustment, whether truly contrite and unlikely to re-offend or
not. U.S. Sentencing Commission, 2005 Sourcebook of Federal
Sentencing Statistics, tbl. 19.
Real contrition, and a low chance of re-offense, can be
something more. From the standpoint of the public, re-offense is
a major concern when a defendant is sentenced for a serious crime;
and contrition is sometimes a proxy for a reduced likelihood of re-
offense. The likelihood of re-offense depends on various factors
in addition to contrition; but the factors are a set of variables
regarding which, especially after Booker, the district court's
judgment deserves weight.
Yet the weight given contrition cannot be beyond review
for reasonableness. Full contrition and even a zero risk of re-
offense engage major concerns of sentencing; incarceration is then
relief from the mandatory minimum under the section 3553(f) "safety
valve," allowing the district court's consideration of Milo's
contrition in relation to the mandatory minimum.
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perhaps not needed to reform that individual, to protect the
community from him and to deter him from committing new offenses.
But punishment is also meant to deter others, affirming the
seriousness of the crime and the penalties that others will likely
face and the difficulty of avoiding punishment.
The need to deter others is under federal law a major
element in criminal sentencing, 18 U.S.C. § 3553(a)(2)(B).5 Given
that objective, we do not see how, taken alone, or combined with
the other factors described above, contrition could justify a judge
in imposing what is effectively no prison time on someone like Milo
who, without duress and simply for personal gain, operated a major
marijuana ring involving a number of individuals over an extensive
period and resulting in the distribution of thousands of pounds of
marijuana.
Many first offenders in drug distribution cases--
including young and impoverished women from other countries used to
smuggle drugs on airplanes--must be desperately sorry when caught
5
See also U.S.S.G. Ch. 1 Part A Introduction (2006) ("Most
observers of the criminal law agree that the ultimate aim of the
law itself, and of punishment in particular, is the control of
crime."); Pell v. Procunier, 417 U.S. 817, 822 (1974) ("An
important function of the corrections system is the deterrence of
crime."); United States v. Taylor, ___ F.3d ___, 2007 WL 2349415 at
*8 (1st Cir. Aug. 17, 2007), petition for cert. filed, No. 07-388
(U.S. Aug. 21, 2007); S. Rep. No. 98-225, at 91-92 (1983) (even if
the defendant will not re-offend, "the heightened deterrent effect
of incarceration and the readily perceivable receipt of just
punishment accorded by incarceration [are] of critical
importance").
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and some probably could persuade judges that they would not re-
offend. Yet if federally prosecuted, such individuals regularly
receive substantial jail terms. To give no significant jail
sentence on account of contrition to a major drug dealer, who has
caused far more harm with far less excuse, would rarely seem
reasonable.
Booker has added substantially to the latitude enjoyed by
district judges, but some equality or proportionality of treatment
is still an objective of sentencing and (save in very unusual
cases) extremely wide deviations from the norm can impair that
goal. See 18 U.S.C. § 3553(a)(6); United States v. Saez, 444 F.3d
15, 18 (1st Cir.), cert. denied, 127 S. Ct. 224 (2006). Further,
the lack of any real prison sentence for what is a major crime
would be very hard for the public to understand, and public
confidence in enforcement of the law is itself a value. 18 U.S.C.
§ 3553(a)(2)(A).
Sentences with no (or trivial) prison time have been
scrutinized severely on appellate review. Recently in United
States v. Taylor, ___ F.3d ___, 2007 WL 2349415 (1st Cir. Aug. 17,
2007), this court vacated a sentence of one-year of community
confinement for a defendant convicted of aiding and assisting in
the preparation of false tax returns, which carried a guidelines
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sentencing range of 30-37 months. Other first circuit cases are to
the same effect.6
This circuit is hardly alone. For example, in United
States v. Wallace, 458 F.3d 606, 612-14 (7th Cir.), petition for
cert. filed, No. 06-7779 (U.S. Nov. 13, 2006), the Seventh Circuit
vacated a sentence of six months of home confinement for a
defendant convicted of wire fraud where the guidelines sentencing
range was 24-30 months, the defendant demonstrated extraordinary
remorse and lived an otherwise exemplary life, but where the
district court failed to provide an adequate justification for an
extraordinarily low sentence.7
Finally, the facts are unhelpful to Milo. He did not
commit only a single criminal act on impulse or out of desperate
need; instead, already earning a good living, he engaged in a large
6
Tom, 2007 WL 2822908 (disallowing six months of community
confinement and 36 months probation for insider trading and
obstruction of justice carrying a guidelines range of 37-46
months); United States v. Thurston, 456 F.3d 211, 215-20 (1st
Cir.), petition for cert. filed, No. 06-378 (U.S. Sep. 14, 2006)
(overturning three-month sentence for Medicare fraud carrying a
guidelines sentencing range of 63-78 months and a statutory maximum
of 60 months); Smith, 445 F.3d at 5-7 (setting aside 46-month
sentence for crack distribution carrying a guidelines sentencing
range of 100-125 months).
7
See also United States v. Repking, 467 F.3d 1091, 1094-96
(7th Cir. 2006) (vacating a one-day jail sentence and six months of
home confinement for bank defrauder who substantially assisted the
government); United States v. Saenz, 428 F.3d 1159, 1162-65 (8th
Cir. 2005) (vacating a 20-month sentence for defendant convicted of
marijuana distribution where the guidelines range was 63-78 months,
and defendant assisted the government).
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number of drug transactions over a substantial period, even though
the government chose to charge them as a single conspiracy count.
In sum, the problem with contrition as justifying so low a sentence
is not the lack of explanation by the district court; it is the
result.
Milo's cooperation is an entirely different matter. One
thing that both statute and guidelines do reward is helping the
government. This is not because helping necessarily shows
contrition or other virtues (although it might be evidence) but
because, in the view of Congress and the Sentencing Commission,
assisting law enforcement is often critical to detecting and
deterring crime, and punishing offenders.8 In this grim calculus,
drug kingpins may suffer little while subordinates serve long
sentences.
Once the government moves under the guidelines or statute
based on substantial assistance, the district court is not bound by
the government's recommendation as to how much of a reduction is
proper. United States v. Martin, 455 F.3d 1227, 1235 (11th Cir.
2006); United States v. Mariano, 983 F.2d 1150, 1157 (1st Cir.
1993); U.S.S.G. § 5K1.1(a). But there are reasons for giving
8
See United States v. Mariano, 983 F.2d 1150, 1155 (1st Cir.
1993); Frank O. Bowman, III & Michael Heise, Quiet Rebellion?
Explaining Nearly a Decade of Declining Federal Drug Sentences, 86
Iowa L. Rev. 1043, 1117 (2001); John R. Steer & Paula K. Biderman,
Impact of the Federal Sentencing Guidelines on the President's
Power to Commute Sentences, 13 Fed. Sent'g Rep. 154, 155 (2000-
2001).
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weight to its recommendations and, like any other factor relied on
by a sentencing judge, the judge's own adjustment is reviewable for
reasonableness. Jimenez-Beltre, 440 F.3d at 518.
Two central realities have to be considered: first, that
the adjustment is usually a discount from the otherwise appropriate
sentence and, second, that the discount itself has costs: in
reducing protection of society from the defendant, in deterring
others, in lessening public confidence in the law's insistence on
just deserts, and in undercutting equal treatment vis-a-vis those
who similarly offended but happen to have nothing to trade.
Congress, the Sentencing Commission and most judges think
that the benefits of cooperation are worth paying a price; but
because the costs are inherent, the public interest often suggests
discounting the defendant's sentence no more than is necessary to
elicit the needed help. In any event understanding this tension
between costs and benefits helps explain why a zero jail-time
sentence for a major crime is highly suspect and also why the
prosecutor's judgment as to the right discount, if not impeached,
is worth careful attention.
Ordinarily, one facing a long prison sentence has a
strong incentive to cooperate in exchange for a reduced sentence.
How to measure cooperation is not straightforward. Partly to
assure real and not half-hearted cooperation, the government wants
to correlate the discount with results and results vary; the
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defendant wants compensation for the costs entailed by cooperation,
especially danger, also a variable. Still, usually needed
assistance can be elicited by some discount well short of 100
percent.
Published data on the distribution of reductions tends to
be gross, but the most recent median decrease below the guidelines
minimum in drug trafficking cases where there was a 5K1.1
substantial assistance motion was 40 months or 43.5 percent below
the guideline minimum. U.S. Sentencing Commission, 2006 Source of
Federal Sentencing Statistics, tbl. 30; see also 2005 Source of
Federal Sentencing Statistics, tbl. 30 (38.5 months or 46.2% below
the guidelines minimum). Here, the government's recommendation as
to Milo was in line with such data.
True, a prosecutor could overvalue or undervalue the
cooperation provided; the prosecutor's interest in the immediate
benefits of cooperation may suggest that the former is the greater
danger.9 But in general the government has both incentive and
expertise to recommend what is needed to secure cooperation. And
both the prosecutor and defense counsel in a district benefit from
9
See, e.g., Michael A. Simons, Retribution for Rats:
Cooperation, Punishment, and Atonement, 56 Vand. L. Rev. 1, 23-24
(2003) (noting risk of prosecutor's overvaluing of additional
convictions and undervaluing of general deterrence); Ian Weinstein,
Regulating the Market for Snitches, 47 Buff. L. Rev. 563, 564-65
(1999) (arguing that prosecutors and defendants do not internalize
the social costs of cooperation--such as increased sentencing
disparities).
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a stable and predictable set of likely adjustments based on help
provided and danger entailed.
Where minimal prison sentences have been imposed in major
drug cases based on cooperation, circuit courts have not been
reluctant to overturn them.10 At the very least, where a district
court varies widely from the government's recommendation in the
"substantial assistance" context, the district court should have
some good explanation as to why it values the defendant's
cooperation far more highly than did the government. See United
States v. Dalton, 404 F.3d 1029, 1033 (8th Cir. 2005).
In this case, Milo gave substantial help to the
government, and one can infer that some risk was involved. But the
government ordinarily insists on results to justify any assistance
reduction; results will often involve risks; and the district court
said nothing of substance here to explain why the result or the
risk in this case warranted a near-zero sentence. Indeed,
assistance was stressed less than contrition, and contrition was
not justification for so low a sentence.
10
See United States v. Desselle, 450 F.3d 179, 181 (5th Cir.
2006), cert. denied, 127 S. Ct. 1148 (2007) (reversing an 87-month
sentence for money laundering and cocaine distribution where
guidelines range was 262-327 months and the government 5K1.1 motion
recommended an adjusted range of 210-262 months); United States v.
Coyle, 429 F.3d 1192 (8th Cir. 2005) (reversing a 36-month sentence
for methamphetamine distribution, where guidelines range was 135-
168 months, and the government recommended a 15% reduction for
defendant's cooperation).
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So far as based on assistance, the facially surprising
sentence in this case lacks the "plausible explanation" needed
under Jimenez-Beltre. Even taking account of both cooperation and
contrition, it is far from clear that adequate basis could be
furnished for a near-zero prison sentence. Anyway, explanation, or
the choice among sentences meaningfully above the zero level, are
in the first instance matters for the district judge on remand.
The sentence is vacated and the matter remanded to the
district court for further proceedings consistent with this
decision. If Milo is not a flight risk, the district court may let
him remain free pending re-sentencing on such terms as the district
court thinks proper.
It is so ordered.
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