Opinions of the United
2005 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


10-26-2005

USA v. Aronowitz
Precedential or Non-Precedential: Non-Precedential

Docket No. 04-4044




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                                                  NOT PRECEDENTIAL


            IN THE UNITED STATES COURT
                     OF APPEALS
                FOR THE THIRD CIRCUIT


                        NO. 04-4044


              UNITED STATES OF AMERICA

                             v.

                  ALAN I. ARONOWITZ,
                               Appellant




       On Appeal From the United States District Court
          For the Western District of Pennsylvania
           (D.C. Crim. Action No. 03-cr-00261-1)
           District Judge: Hon. Arthur J. Schwab


       Submitted Pursuant to Third Circuit LAR 34.1(a)
                      October 19, 2005

BEFORE: SMITH, STAPLETON and NYGAARD, Circuit Judges

              (Opinion Filed October 26, 2005)




                OPINION OF THE COURT
STAPLETON, Circuit Judge:

       From 1997 to 2002, Alan Aronowitz, a licensed dentist, charged an insurance

company as if he had performed certain root canal procedures even though he had in fact

unlawfully allowed dental assistants to do the work. In 2004, he pled guilty to health care

fraud under 18 U.S.C. § 1347 and was sentenced to 48 months of imprisonment.

       Aronowitz was sentenced after the Supreme Court had decided Blakely v.

Washington, 

(2004), but before United States v. Booker, 

(2005), when the validity of the U.S. Sentencing Guidelines was somewhat in doubt. The

District Court found the Sentencing Guidelines to be unconstitutional, but nevertheless

considered the suggested guidelines range for the offense as informing the decision rather

than mandating it, an approach later prescribed by the Supreme Court. See 

. At sentencing, the District Court found that the amount of loss in

Aronowitz’s case was between $199,000 and $344,000, a fact which had been included in

a Presentence Report calculating a 41-51 month sentencing range. The District Court was

reminded of that range at sentencing. The District Court sentenced Aronowitz to 48

months which “adequately conforms with the statutory objectives of [18 U.S.C. § 3553]

. . . [and is] appropriate to address the sentencing objectives including punishment,

rehabilitation, and deterrence.” App. at 138.

       While Aronowitz’s sentence was enhanced based on facts neither admitted to nor

found by a jury, he does not complain that his Sixth Amendment rights were violated by



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raising a Booker challenge on appeal. In addition, remanding to allow the District Court

to resentence in light of Booker would be redundant in this case since the District Court

essentially applied the analysis called for by that case. Thus, the framework enunciated in

United States v. Davis, 

(3d Cir. 2005) (en banc), does not apply to

Aronowitz’s sentence. Instead, we will review the District Court’s application of the

Guidelines de novo, as under our prior case law, see, e.g., United States v. Brennan, 

, 200 (2003), and Aronowitz’s sentencing for “unreasonableness.” See 

.

       Aronowitz argues on appeal that the District Court erred by finding that he caused

any monetary loss in determining his sentence. Aronowitz argues that there were no

“losses” because there was no proof that any of his patients were harmed by the root

canals that he had his employees perform unlawfully. 

He relies on United

States v. Maurello, 

(3d Cir. 1996), and United States v. Hayes, 

(3d Cir. 2001), as establishing the proposition that, for the purposes of sentencing those

who fraudulently offer professional services to the public, “loss” may not include the

services that were “satisfactory” and “have not harmed” the public. 

. According to Aronowitz, because the government did not make any showing

that patients were harmed by the root canal procedures, the District Court was wrong to

consider that his conduct caused any loss.

       Aronowitz’s reliance on Maurello and Hayes is misplaced because those cases



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have been disavowed by the U.S. Sentencing Commission. In November 2001 (10

months after Hayes was decided), an Application Note was added to the Sentencing

Guidelines that read:

       In a case involving a scheme in which . . . services were fraudulently
       rendered to the victim by persons falsely posing as licensed professionals
        . . . loss shall include the amount paid for the property, services or goods
       transferred, rendered, or misrepresented, with no credit provided for the
       value of those items or services.

U.S. Sentencing Guidelines Manual § 2B1.1, cmt. n.3(F)(v). The Sentencing

Commission specified United States v. Maurello as one of the two cases prompting the

addition of this Application Note:

       This rule reverses case law that has allowed crediting (or exclusion from
       loss) in cases in which services were provided by persons posing as
       attorneys and medical personnel. See U.S. v. Maurello, 

(3d
       Cir. 1996) . . . The Commission determined that the seriousness of these
       offenses and the culpability of these offenders is best reflected by a loss
       determination that does not credit the value of the unlicensed benefits
       provided.

U.S. Sentencing Guidelines Manual app. C, vol. II, amend. 617, at 183-84 (2003).

       Commentary to the Sentencing Guidelines is as binding as the Guidelines

themselves are on the sentencing court. See Stinson v. U.S., 

, 46 (1993)

(“Amended commentary is binding on the federal courts even though it is not reviewed by

Congress, and prior judicial constructions of a particular guideline cannot prevent the

Commission from adopting a conflicting interpretation . . . .”). While, as we have noted,

Booker instructs that the Sentencing Guidelines are no longer “mandatory,” it also finds



                                              4
that the Guidelines are “advisory” and requires that sentencing courts consider the advice

they give. 

. If District Courts, required to be informed and

guided by the Guidelines before imposing sentences, continue to follow an interpretation

of the guidelines that has been effectively overruled, then they would be to be

misinformed and misguided by them. So, while the Guidelines as interpreted in the

Commentary are not “controlling” in that they no longer dictate a sentence within the

specified range, they are “controlling” in the sense that the Sentencing Commission

retains the power to divest this Court’s case law interpreting the guidelines of its

precedential force.

       Because the Application Note in this case is “controlling” in that it divests

Maurello and Hayes of their precedential force, the District Court here could refuse to

consider it only if doing so would raise ex post facto concerns. See United States v.

Marmolejos, 

, 493 n.7 (3d Cir. 1998) (“Commission commentary

. . . remains controlling authority, that is to be applied in all but the most limited

circumstances . . . despite any conflict with established precedent, unless ex post facto

concerns are present.”) (citations omitted). Here, not only did Aronowitz not raise any ex

post facto concerns on appeal, but our Court has found that no ex post facto problem is

presented by applying Guideline amendments to criminal conduct – even if the

amendments that do more than merely “clarify” the law – as long as the amendments took

effect during the course of the criminal conduct. See United States v. Brennan, 

176, 198 (3d Cir. 2003) (finding that, while “an amendment [that] overrules a prior

judicial construction of the guideline . . . is substantive” (and not a “clarifying”

amendment), such amendments “would still not violate the ex post facto clause if the

fraud continued after the effective date of the amendment”). This Application Note took

effect in November 2001. U.S. Sentencing Guidelines Manual app. C, vol. II, amend.

617, at 186 (2003). Aronowitz’s course of conduct continued through 2002. Even

though this Application Note effectively overrules prior precedent, it is constitutional to

apply it to Aronowitz’s criminal conduct.

       Reviewing the District Court’s determination under the sentencing guidelines de

novo, the sentencing range considered by the District Court did not rest on an improper

calculation of loss under the Guidelines based on the amended commentary. As this was

the only error raised on appeal, Aronowitz’s sentencing was not “unreasonable” and the

judgment of the District Court will be affirmed.




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