*1 must serve his fed- Romandine ends, after state eral sentence persuade Attorney he can
unless Gen- to start the federal clock while he is
eral custody.
still in state AND REMANDED FOR RESTORATION VACATED 1995 Sentence. May America,
UNITED STATES of
Plaintiff-Appellant, TOMASINO,
Michael J. Defendant-
Appellee.
No. 99-2796. of Appeals, States Court
Seventh Circuit.
Argued Jan.
Decided March *2 POSNER, Judge, and Chief
Before RIPPLE, Circuit EASTERBROOK Judges.
POSNER, Judge. Chief government appeals from dis The at (reported trict court’s refusal (N.D.Ill.1999)) to enhance F.Supp.2d 565 mail fraud sentence under the defendant’s 2Fl.l(b)(7)(B), provides which increase in for 4-level financial institution and fraud “affected a $1,000,- than defendant derived more in gross receipts from the offense.” question, us with appeal confronts Lauer, open in United States left (7th Cir.1998), 766, 768-70 guideline’s validity. guideline promulgated 2507(a) response to section of the Crime
Control Act Pub.L. 4789, 4862, which commands in Stat. who derive punishment creased receipts in gross than million from more $1 “a financial mail fraud institution (as defined in Section 20 of title United Code).” The list of financial institu States include, 20 does not either tions section funds, pension yet a implicitly, or explicitly pension fund was the “financial insti tution” affected Tomasino’s fraud. However, Commission’s au guide thority promulgate sentencing interpret lines is not limited ones that contrary, a statute. On the apply major picking task is that of ranges sentencing statutory within mini limits—a legislative mum and maximum task. interpretive rather than So even though Congress did not command the punishment of Commission to increase the people who commit a mail fraud that af (argued), M. Berkowitz Office of Sean yields fund and the male fects Attorney, Ap- Criminal States million, factor than the Commis more $1 Division, IL, peals Chicago, for Plaintiff- to legislate sion was free such an increase Appellant. (within maximum) by statutory means Sergio Rodriguez (argued), guideline. F. Office of of a Ruther Program, ford, Federal 374 n. Chicago, Defender IL, including Defendant-Appellee. question whether in punishment-increasing By Application sion funds sion funds. exercising Commission had made the that it legislative authority merely 961(m) misread response promulgated to section 2507(a) overlooking section funds, of FIRREA include but the In to section 20. the latter cross-reference explicit note that in *3 event, applied the is invalid as doing the “imple- so Commission was pension funds. See United States ment[ing], form, a broader the instruc- (5th 291, Lightbourn, 115 F.3d 292-93 Cir. 961(m)” tion to the Commission in section 1997), general point clearly where the added). (emphasis clear, therefore, It was stated. that the Commission it believed that was exercising its legislative power rather than guide There is no doubt that the merely interpreting the statute. When line funds. Application embraces one year later the Commission added (now 16) to guideline Note 14 section 2F1.1 (b)(7)(B) to the in response to the so, and says application part are *4 “in a form” dropped. the words broader background to the new sub lished a nóte not to inadvertently. We are so devoted section, be the natural inference would in un- interpretation literalism that we are a just had doing it what it done that was to consider a But willing possibility. such to assimilating pension funds year before— jacking up a defendant’s before of legisla a matter financial institutions as a legislative on the basis of determination The not Commission is judgment. tive by Sentencing a court notes, and publish background to required at, confidence, should have least minimal will in their absence courts assume lacking, that was here not is Commission knows when it exercis misinterpreting a statute. If we do simply
ing legislative judgment, especially a since not know whether usually issuing is it in does exercising legislative judgment, its we do regularity A guidelines. presumption of lawfully not know whether Tomasino was it doings, attends the as Commission’s sentenced. But if a that of other official bodies. does said, a background Any underpunishing dumb risk of To note “This can guideline promulgating, we’re we’re masino be avoided the district remand, doing deferring, resentencing com court’s on has to,” wrong manded us and this was Tomasino until —Con commanded, opportunity clarify but au has had a gress merely reasonable understanding issuing pension- courts could not overlook its thorized —the fund he guideline the error. Discretion is abused when under which was sen (The clarification, erroneously he decision maker thinks that tenced. needed course, itself, compelled make a particular application decision is not note pellucid, background so fails The which is judgment. to exercise note.) Although fact that the error be might membership concealed justify dis overlooking when Commission has turned over since the closed, And, blatantly example. promulgated, in our we assume although like agency other that like administrative it has discretionary memory agencies administrative an institutional that enables character, that is we an a court evalu power clarify action that cannot clarifying not think the note can be ate without A background do clarification. “legislative history,” lawfully applied dismissed as mere can be retroac l.Bl.ll(b)(2); tively, a demand for clarification as a demand United (7th Goudy, be States v. “subsequent legislative history,” 78 F.3d 314-15 both Patasnik, Cir.1996); interpretation aids to that are derided (2d Cir.1996), quarters. Lacking in some influential as distinct from legislatures, that increases legitimacy punis democratic one the defendant’s . Bullis, hment agencies do not have the same freedom States arbitrary let grounds, base decisions on we do not formality new issuing guide- options derstood their 1991. think the This ele- line, formally speculation a guideline so vates about the Commission- n note, denoted, application even ers’ mentation over the Commission’s note, background required Normally say here. The deeds. a court will legislative history note under which clear cannot contradict Tomasino text; gave statutory him clear notice of the clear was sentenced here say intention that he sen- that an history Commission’s unclear administrative judge prevails range pellucid tenced within the used over text. him, sentencing and so there is no issue depends this case on whether retroactivity. note Sentencing Commission’s prescribe punishment, does not and the Note to the 1991 fully amendment reveals question meaning is unrelated to understanding of its op- retroactivity. question whether To- tions, then Tomasino has been sentenced masino was sentenced under a valid guide- improperly. Note does question requires line is the clarifica- not show whether the Commission under-
tion. stood its discretion to the higher limit sen- vacate re-
We Tomasino’s sentence and tences for fraud “financial institu- mand the case the district court tions” to entities listed 18 U.S.C. *5 him giving resentence after the Commis- § ought 20. But the depend not opportunity clarify a reasonable sion to on the extent to which the Commission promulgating intentions options rejected, discussed the 2Fl.l(b)(7)(B). § we know which one it Applica- embraced. 14) (formerly tion Note 16 to U.S.S.G. REMANDED, AND WITH VACATED DIRECTIONS. 2Fl.l(b)(7)(B) § provides: EASTERBROOK, Judge, Circuit institution,” “Financial as in this used dissenting. guideline, any to include defined insti- arises from the §§
Our case interaction tution described in 18 U.S.C. 657, 1005-1007, 1014; by policy-making decisions two any bodies. and state or First, bank, Sentencing foreign there is a decision of company, trust credit un- ion, affecting company, fraud bank insurance investment fund, af- identically company, savings (building should be treated to fraud mutual Second, loan) fecting association, a pension fund. there'are and union employee or fund; health, pension any and 1990 decisions medical or association; insurance penalties who change hospital brokers implementing registered, required defraud banks. When and or to dealers be statute, adopted registered, the Commission with the and Ex- pari- first Securities Commission; ty change commodity bank pension-fund between fraud and futures responding commodity pool opera- fraud. and When second merchants statute, required registered, regis- tors or be amended 2Fl.l(b) tered, parts Commodity § § and 2B1.1 and with the Futures 2B4.1, subject Commission; already Trading and similar each to declara- affecting entity, pension tion that frauds funds whether or not insured government. employ- the same as federal or are treated frauds “Union health, easy respect “any pension banks. It is for us to both ee fund” medi- association,” cal, Congress’s. as hospital the Commission’s decision and insurance above, my primarily large include colleagues Yet dishonor one of these used many decisions-—the decision sion funds serve individuals large pension-fund (e.g., to treat fraud national unions, and organizations, as bank fraud —on the international the same might corporations doing have misun- substantial interstate Commissioners apa’s It some business), sion. must follow that under- and associations 994(x), disability, incor- pension, procedures, see 28 provide take to hospital- but its substan- (e.g., porating medical or 5 U.S.C. other benefits insurance) large subject numbers of ization to review tive decisions are apa’s persons. standards. The 1991 under deemed therefore cannot be amendment are treated as Application Notes Because inadequately explained. invalid Guidelines, Stinson part of the Commis- My colleagues do hold the (1993), governing To- the rule of explanation. to a minimum standard sion commit- he explicit: masino’s sentence Application Note They would enforce which he derived more a fraud from ted kept as written receipts; one of gross than million in $1 and because spoke, silent. But because fund; thus under his victims was a (“Subsection Note 2Fl.l(b)(7)(B) his offense level form, (b)(7)(A) in a implements, broader was sentenced increased. Tomasino the instruction to the Commission sec- prison, under months 101-73.”) 961(m) of Law differs tion Public 2Fl.l(b)(7)(B) range is 51-63 (“Subsec- the 1991 from “Unquestionably months. (b)(7)(B) implements the instruction to tion heavily punished Tomasino more wanted in section 2507 of Public (majority at op., than he was” 101-647.”), my colleagues wonder Law 741). form” whether omission of “in a broader clear, Application Note is Because the Commission misunder- implies ambiguous job our is over—there is under of Pub.L. obligation stood its requiring interpretation text —unless Puzzlement leads a refusal 101-647. If the Com- Application Note invalid. *6 guideline enforce the note unless agency, the ordinary Ap- mission were an (whatever within “reasonable” time Note, 2F1.1(b)(7)(B), plication and thus mean) the clarifies its may be invalid under the Admin- might deemed “understanding” of the issue. 206 F.3d at Act, the istrative Procedure Com- 742. adequately explain why not mission did I with the agree principle proposition in jack up punishment per- decided to that a Note could show funds, sons who defraud when invalid, for the same rea- the Guideline Congress required for increase regula- explanation that the of a son ferc’s crimes that have banks as victims. certain Register tion in the Federal could show did do this in The Commission not that its rule is irrational. for reasons 2Fl.l(b)(7)(B) adopted part when I do think that discussed later not Amendment or for that matter “in a broader form” demon- omission of part when as of Amendment 317 misunderstanding legal strates a 2Fl.l(b)(7)(A) promulgated what is now of the governing rules the amendment Application defining pension and the we have is not a clear rules 1991. What All funds as “financial institutions”. How legal uncertainty. error but should is that it was Commission said background with an ambiguous court deal legis- “in a form” a implementing broader a form of My colleagues’ approach, note? penalties command to lative increase (but spirit to the “remand” jeopardizing 'banks’ financial soundness. remand), unprece- any without actual Energy No court would let the Federal dented and invites evasion the Commis- Regulatory adopt a rule with enabling legislation. unprece- sion’s explanation. portion such But the elliptic part enough; is clear our decision apa judicial dented that authorizes review of agencies’ is the’ first to hold a sentence be adequacy explanations pending not in limbo new action apply kept does Commis- to which had Compare Chapman Commission. attention. States, 1998 and the
no members between October just beginning (1991) of November to end L.Ed.2d 524 (applying the lsd backlog address a substantial of old busi- guideline though even it is harsh and can ness and cannot attend our demands on erratically), work with Neal notice. Why short should U.S. S.Ct. (or Commissioners) think that this is- (1996) (noting that the Com to priority sue is entitled over other mat- later guideline). mission amended the lsd nothing ters? Yet even it had else to do If the Commission believes that a guidelines the Commission could revise applied way, an inappropriate dispatch. publish- with Proposals must be may change apply rules and 994(x); ed for comment under after re- amendment all persons. affected Even ceiving comments the Commission must relatively short sentences such as Tomasi- promulgate a text it Congress; and send are long enough no’s in relation to the change take effect for at least amending cycle that may defendant days, during Congress may which leg- receive the benefit. Thus right thing § 994(p). islate. 28 Commis- for us do with is remand instructions sion generally promulgates amendments in resentence range Tomasino within pre April and makes them effective the .next 2Fl.l(b)(7)(B) §by scribed and send November 1. No proposal added to the copy opinion to the Commission. agenda today go could into the Commission concludes that 1, 2000, until force November no matter funds should excluded from the applica how abbreviated the publica- schedule for 2Fl.l(b)(7)(B), tion of put it can tion, public comment, and promulgation. 1, 2001, change into effect November November be a more would realis- eligible and Tomasino will be for release target. By tic inviting Commission to (the serving right after months sen clarify issue new note' levels). My tence without extra col other, matters in unspecified, way, some leagues’ contrast, approach, by spurns the release) perhaps by press rather than to method Congress provided inviting while reissue the or an violation of 994. note, my colleagues invite evasion of these time limits. I am not prior aware of Unless uses *7 by change effort the Commission to the 3582(c)(2), Tomasino should a serve sen- legal effect of a is within By tence the range. rul- —-and the majority contemplates what otherwise curtail the —without using processes §of 994. If the Com- 2Fl.l(b)(7) of only effect also mission rather than a up court came with 2B4.1, 2B1.1 and which were altered this back door of changing method way by the same and at same time rules, I doubt that we permit would 317 A Background Amendments and 364. gimmick to work. is a history. Note form administrative Just as me, however, committees sometimes principally
What concerns law, explain why they enacted the interpretive Congress method. has they expect .accomplish, what it a specified ambiguities means to clear up explains why sometimes unjust applications and prevent guidelines. explanation amended An may Guidelines. direct from or the the retroactive either amendments. 3582(c)(2). right may 18 matter thing suggest thought through fully. for a court to Does authorize do when is unsure this whether either to enforce a rule or “con- Commissioners understood all refusal their options is to a apply the text as written and struction” of text to confine to the subject to draw the to the judges situation that deem well 746 subject.) ry or files We would be on
thought out? No. We have
on
legal
text
highest authority
asking
that when
off
from dec
better
members
disregard its
unambiguous a court
narrating
to file affidavits
ago
ade
Co.,
v.
background.
Shell Oil
Robinson
staffs)
(or
they
thought
their
about
340,
843,
337,
136
117 S.Ct.
U.S.
519
would be im
approach
matter. But
(1997);
Ron
States v.
L.Ed.2d 808
United
count;
proper
many
for too
reasons
241,
Inc.,
235,
Enterprises,
489 U.S.
Pair
scrutinizing public officials’mental
ban on
(1989);
1026,
747
Inc.,
Industries,
100
generic
U.S.
of the crime is a
“financial institu-
(1980);
S.Ct.
64 L.Ed.2d
Swain
tion” the
pen-
Guidelines treat banks -and
372, 378-79,
Pressley,
sion
identically.
(Only
funds
(1977).
my
Notes
Notes that the sentences for those who defraud fact that utable the fundamental pension plans Every should be lower. (“do we with equate pen decision banks every- mention of financial institutions funds?”) sion had been made 1990 rath where Guidelines treats er than 1991? Or should we assume that Similarly, two Chapter alike. 8 of the the 1991 amendment reflects incom groups pension Guidelines funds with oth- banks) petence the Commissioners issued organizations (including er for the —that
Pub.L. 101-647 or the Notes apply Some to of- banks, they adopted year My against fenses before? others exclusive- ly against pension (e.g., colleagues say that because the Back to offenses 2E5.1), ambiguous, but the victim is we should wherever Note carelessness) (or many to too ness extreme that treats Commis reading adopt the intelligent people. Yet as bumblers. and their staff sioners of adminis norm longstanding is a there end, depart from In the silent the record is law that when trative adopted com agency as treat ambiguous, we thought. We what it they not sure are presumption regularity, A of petent. instead, rules. Deeds enforce its ought, presumptions, it. Like other judges call the lack thoughts over prevail indicators, 2Fl.l(b)(7)(B) but contrary upset by can be thoughts). Section conduct are none. cover Tomasino’s Application here there ambiguity. We directly. If the There Note stands alone. as Sentencing Guidelines apply should body com were an informal un- written, and leave to the Commission a draft lay like board members posed 3582(c)(2) the decision der System, the old Service under Selective persons Tomasi- the sentences of reduce we assume silence maybe then should position. no’s judges though did legal implies error — draft boards. this even about assume Neckels, 709, 712 v. United States Harris, (9th Cir.1971); But the Branch part of Judicial 991(a); Mis government. 28 U.S.C. 361, 384- tretta v. United (1989). 102 L.Ed.2d America, UNITED STATES members At least three of its seven Plaintiff-Appellee, and the Commission judges, be federal large legal staff. The Commis also has a CORRY, Defendant-Appellant. Lisa W. promulgated Amendment 364 sioners who judges, circuit two district included two No. 99-2896. law.† To judges, professor and one Appeals, States Court of up the suppose that of them looked none Circuit. Seventh legal cross-reference in significance, them its staff did not alert Argued Jan. wrong that as a result the Commissioners March Decided ly thought they compelled had been de increase the sentences of who funds, this fraud and that have legal Commission would error the mandating decision reversed frauds identical sentences for committed banks, fantas against pension funds and presumption regularity tic. Doubtless here implausible. looks sometimes fitting, and regularity presumption imputes foolish contrary presumption zone, Nagel. The llene H. †The and Professor of the Commission Chairman Steer, Judge W. Wilkins. The other Circuit members were Julie the ers, William who General Counsel was John R. (appointed E. Carnes appointed as a member in to the Commission 1992), G. Corrolh- district court in Helen Getty and 1999. Carol Pavilack November Gelacak, George Judge Michael S. Circuit Maloney ex Paul L. served members officio. MacKinnon, Judge A. Maz- E. District David