United States v. Mitchell J. Stein
964 F.3d 1313
| 11th Cir. | 2020Background
- Mitchell Stein, former corporate counsel for Signalife, fabricated purchase orders and publicized false sales, leading to SEC and DOJ investigations; a jury convicted him of multiple fraud and money‑laundering counts and conspiracy.
- On initial appeal this Court affirmed convictions but vacated the sentence and restitution, instructing the district court to "calculate anew the amount of loss" and specifically to consider investor reliance and intervening events.
- On remand the government presented expert Dr. Chyhe Becker (statistical analysis of abnormal returns and controls for market/short‑selling); Stein produced a rebuttal expert, Dr. O’Neal.
- The district court credited Dr. Becker, recalculated loss and restitution as $1,029,570 for 616 investor victims, and resentenced Stein to 150 months’ imprisonment (down from 204 months).
- Stein also belatedly challenged the district court’s $5.4 million forfeiture order and renewed due‑process/Brady/Giglio claims; the district court declined to reconsider those matters as outside the limited remand or untimely.
- The Eleventh Circuit affirmed, holding the remand was properly limited, the loss/restitution findings were supported, and the other claims were barred by the mandate and law‑of‑the‑case doctrines.
Issues
| Issue | Plaintiff's Argument (Stein) | Defendant's Argument (Government) | Held |
|---|---|---|---|
| Sufficiency of evidence for investor reliance and actual loss | Government failed to prove but‑for reliance and causation for each investor; loss calculation unsupported | Dr. Becker’s event‑study and statistical analyses show abnormal returns tied to Stein’s fraud and support aggregate reliance; district court may use circumstantial proof | Court affirmed: district court reasonably credited Dr. Becker; $1,029,570 restitution and loss calculation upheld |
| Effect of intervening events (2008 market downturn, short selling, April 2008 call) | Stock decline caused mainly by market downturn/short selling and April call, not Stein’s fraud; court should reduce loss | Becker’s tests show Signalife not correlated with market/industry and short‑selling not statistically significant; April call created uncertainty tied to fraud | Court found no clear error in rejecting intervening‑events argument; district court’s proximate‑cause findings stand |
| Relitigation of Brady/Giglio due‑process claims on remand | Newly revealed evidence (e.g., Tribou declaration) and other arguments justify reconsideration and new trial | Prior panel already considered and rejected due‑process claims; mandate and law of the case bar relitigation; Tribou declaration untimely/immaterial | Barred by mandate and law of the case; Rule 33 supplement untimely and, even if considered, not material to the prior holdings |
| Forfeiture order and Honeycutt challenge | Forfeiture not shown traceable; Honeycutt forecloses joint and several forfeiture liability | Forfeiture challenge falls outside the limited remand and was not timely raised; Honeycutt construed §853 (drug statute) and does not control §§981/982 | Barred by mandate/law of the case; Honeycutt is not an intervening controlling change for §§981/982 and does not dictate vacatur |
Key Cases Cited
- United States v. Stein, 846 F.3d 1135 (11th Cir. 2017) (prior panel affirming convictions but remanding to recalculate loss and restitution)
- Piambino v. Bailey, 757 F.2d 1112 (11th Cir. 1985) (mandate rule: district court must strictly comply with appellate mandate)
- Honeycutt v. United States, 137 S. Ct. 1626 (2017) (interpreting §853 and declining joint and several forfeiture where statute requires property the defendant "obtained")
- Litman v. Mass. Mut. Life Ins. Co., 825 F.2d 1506 (11th Cir. 1987) (en banc) (limits on district court authority under a limited appellate mandate)
- United States v. Mesa, 247 F.3d 1165 (11th Cir. 2001) (limited remand restricts issues district court may consider)
- Schiavo ex rel. Schindler v. Schiavo, 403 F.3d 1289 (11th Cir. 2005) (law‑of‑the‑case doctrine bars revisiting decided issues)
- Westbrook v. Zant, 743 F.2d 764 (11th Cir. 1984) (exceptions to law‑of‑the‑case doctrine)
- Knight v. Thompson, 797 F.3d 934 (11th Cir. 2015) (district court may weigh competing expert testimony and make credibility determinations)