United States v. Medoff
U.S. Court of Appeals for the First Circuit
United States v. Medoff
Opinion
United States Court of Appeals
For the First Circuit
No. 24-1750
UNITED STATES OF AMERICA,
Appellee,
v.
CRAIG MEDOFF,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Mark L. Wolf, U.S. District Judge]
Before
Montecalvo, Howard, and Aframe,
Circuit Judges.
Amy Barsky, with whom Fick & Marx LLP was on brief, for
appellant.
Donald C. Lockhart, Assistant United States Attorney, with
whom Leah B. Foley, United States Attorney, was on brief, for
appellee.
November 18, 2025
AFRAME, Circuit Judge. In 2016, following approximately
four years of litigation in a civil securities fraud enforcement
action brought by the Securities and Exchange Commission ("SEC"),
defendant-appellant Craig Medoff agreed to the entry of a judgment
that, for ten years, barred him and any entity he owned or
controlled "from participating in the issuance, offer, or sale of
any security."
In 2024, Medoff pleaded guilty to criminal contempt of
this judgment, see 18 U.S.C. § 401(3); Fed. R. Crim. P. 42(a), and
was sentenced to twenty months of imprisonment, a variance of ten
months above the top of the applicable guidelines sentencing range
("GSR"). He now seeks vacatur of his sentence on two grounds. He
principally argues that the sentencing judge should have recused
himself from presiding over the criminal contempt proceeding
because his impartiality might reasonably have been questioned.
See 28 U.S.C. § 455(a). Alternatively, he contends that his
sentence was procedurally and substantively unreasonable. We
reject his arguments and affirm.
I.
Medoff has a long history of violating federal
securities laws and being involved in related criminal and civil
proceedings. We provide a detailed account of this history to
place Medoff's recusal arguments in context. The following facts
are undisputed.
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A.
On September 7, 1993, Medoff settled an SEC civil
enforcement action, brought in the Southern District of New York,
that charged him and the company of which he was president with
fraudulently offering unregistered securities. In settling the
case, Medoff consented to the entry of a permanent injunction that
barred him from violating the anti-fraud provisions of the federal
securities laws; required him to pay a civil penalty of $95,500;
and ordered him to disgorge money he had obtained through his
fraudulent conduct. On January 6, 1995, in a related
administrative action, Medoff also agreed to an offer of settlement
that barred him from associating with any securities broker,
dealer, investment advisor, investment company, or municipal
securities dealer. Medoff neither paid the civil fine nor complied
with the disgorgement order. Nor, as we shall see, did he abide
by the terms of the prohibitory orders that regulated his conduct
with respect to securities.
On April 26, 1995, in a criminal action that was also
instituted in the Southern District of New York, Medoff pleaded
guilty to a sealed information charging him with two counts of
conspiracy to commit fraud in connection with the offer and sale
of securities. On October 20, 2009, more than fourteen years after
his guilty plea, Medoff was sentenced to three years of probation
and a $6,000 fine, which he did not fully pay. From 2011 to 2014,
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Medoff was twice incarcerated for a total of about seventeen months
on probation violations for failing drug tests and not making
payments towards the fine.
B.
On December 14, 2012, while Medoff's troubles in the
Southern District of New York were ongoing, the SEC instituted a
civil enforcement action in the District of Massachusetts against
Medoff; Biochemics, Inc. ("Biochemics"); and two additional
individuals. The complaint alleged, among other things, that
Medoff had participated in a fraudulent scheme to sell Biochemics
securities to investors. It also highlighted the 1993 and 1995
judicial and regulatory orders that barred Medoff from violating
the antifraud provisions of the federal securities laws and
associating with any securities broker, dealer, investment
advisor, investment company, or municipal securities dealer. The
case was assigned to then-Chief Judge Wolf.
On March 18, 2015, the SEC submitted a proposed consent
judgment for defendant Biochemics to the district court. The
judgment contained language stating that the company would have to
pay a substantial fine and disgorgement order within fourteen days
of its entry. The court rejected this proposed judgment,
apparently because all parties agreed that Biochemics would be
unable to pay the disgorgement order and fine within the short
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time specified. The court stated that it would not issue an order
that it did not intend to enforce.
A few days later, on March 25, 2015, the district court
entered a revised judgment for defendant Biochemics that obligated
the company to disgorge $17,147,884 (including prejudgment
interest) and to pay a civil penalty of $750,000. The revised
judgment contained a schedule requiring payment of the fine within
seven months and thereafter requiring payment of the disgorgement
order, with interest, in five consecutive monthly payments.
Biochemics paid the fine but did not make any of the disgorgement
payments. During the litigation that ensued, the court repeatedly
reiterated its unwillingness to issue orders that it did not intend
to enforce.
On May 25, 2016, the district court entered a final
consent judgment against Medoff that, for a period of ten years,
prohibited him and any entity that he owned or controlled "from
participating in the issuance, offer, or sale of any security."
The judgment also ordered Medoff to pay a $100,000 civil penalty
and to disgorge $14,370.20 (including prejudgment interest). As
in the Southern District of New York litigation, Medoff did not
satisfy any of these obligations.
On September 27, 2023, the SEC sought an order for Medoff
to show cause why he should not be held in civil contempt for
failing to comply with the 2016 consent judgment. In a memorandum
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supporting its motion, the SEC stated that, in violation of the
2016 consent judgment, since at least 2021, Medoff "had involvement
with, and likely ownership and/or control of, a financial services
company . . . [named] Nova Capital International LLC" ("Nova
Capital"). The SEC attached to its memorandum affidavits and
exhibits supporting its allegations about Medoff's involvement
with Nova Capital and detailing Medoff's history of securities
fraud and non-compliance with court orders. It requested, among
other things, an order directing Medoff to cease violating the
2016 consent judgment and to disgorge all money earned through its
violation. It also requested "[a]n order imposing such other
sanctions as the Court deems appropriate, including additional
civil penalties, to ensure Medoff's future compliance."
On October 13, 2023, the district court issued a
responsive memorandum and order stating that the SEC had provided
"ample evidence to justify the initiation" of civil contempt
proceedings. The court also stated that the SEC's evidence "raises
the question of whether it would be appropriate for the court to
initiate criminal contempt proceedings instead." The court
elaborated: "In view of Medoff's proven history of violating court
orders, conducting proceedings that could only result in another
order that could be violated might be futile. Therefore, [a] civil
remedy may be inappropriate and criminal contempt proceedings may
be justified."
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In the memorandum, the district court also scheduled a
hearing for October 23, 2023, "to address whether [it] should
initiate civil or criminal contempt [proceedings] for the
violations of its May 25, 2016, [consent judgment] alleged by the
SEC . . . ." And it further ordered that a representative from
the U.S. Attorney's Office attend the hearing, as well as any
counsel Medoff retained to handle a possible criminal prosecution.
The court also stated that, if Medoff wished to have counsel
appointed from the Criminal Justice Act ("CJA") panel, he should
file an appropriate financial affidavit with the court in time for
appointed counsel to attend the hearing.
Medoff did not request the appointment of counsel -- he
instead attempted to secure private counsel -- but counsel from
the CJA panel nonetheless attended the hearing as an observer.
So, too, did an assistant U.S. attorney. At the hearing, the
district court reiterated its concern that issuing another civil
contempt order would be futile. Speaking to counsel for the SEC,
the court explained why it was considering criminal contempt:
I don't issue orders that I don't expect are
going to be obeyed and my concern
is . . . that if I just order [Medoff] not
to . . . engage in the securities business, I
don't know why I would have any confidence
he's going to obey the order the third time
when he, according to you, didn't obey the
2016 order at all. And if he's in the
securities business, he's continuing to
present a danger.
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Counsel for the SEC responded that the SEC only has the authority
to move for civil contempt, not criminal contempt; that the agency
shared the court's futility concerns; but that, in its view, a
targeted civil contempt order could nonetheless be effective.
Counsel added: "If I'm wrong, then the recourse to criminal
contempt remains."
At the end of the hearing, the district court agreed to
give Medoff additional time to secure funds to hire private
counsel. The court also deferred deciding whether to institute a
criminal contempt proceeding while the parties explored a possible
resolution of the SEC's motion to show cause. But the court made
clear that it was then inclined towards initiating criminal
contempt proceedings. The court also advised Medoff of his right
to remain silent, and that, if a criminal case were initiated
against him, he might be entitled to a jury trial; appointed
counsel; and pretrial release, if there were a combination of
conditions that would protect the community from any danger he
posed. Two days later, on October 25, 2023, two privately retained
lawyers appeared for Medoff.
On November 17, 2023, the parties filed a joint status
report notifying the district court that they had reached an
agreement to resolve the SEC's motion to show cause. The
agreement, which outlined several civil sanctions to be imposed on
Medoff, was subject to his providing the SEC with certain
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information and documentation. The joint status report also
stated: "[I]n light of Medoff's agreement to comply and supporting
documentation [sic], the SEC does not recommend sanctions beyond
those outlined above to ensure future compliance." By order dated
November 22, 2023, the court directed the parties to file a jointly
proposed order implementing their agreement and including "a
provision stating that [the agreement] is without prejudice to the
court's authority to initiate criminal contempt proceedings for
any possible violation of prior orders and/or the proposed order."
Six days later, the parties filed the proposed order.
On December 1, 2023, the district court held a hearing
on the proposed order, which contained the required language
regarding criminal contempt and also, among other things,
obligated Medoff to cease engaging in conduct violative of the
2016 consent judgment; to provide the SEC with certain information
about Nova Capital's clients; to provide Nova Capital clients with
curative notice of his "disciplinary history"; and to provide
detailed accountings of his and Nova Capital's assets and
liabilities. At the hearing, the court asked counsel for the SEC
what it meant by its statement in the November 16, 2023, status
report that it did not recommend sanctions beyond those outlined
in the report. SEC counsel replied:
I think there may have been some confusion
there, and I apologize if that was unclear to
the Court. What we were referring to there
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is with respect to civil contempt. So part
of our original motion contemplated that
there may be penalties or other sanctions
entered by your Honor to enforce the 2016
judgment. This is just speaking to any
further civil contempt.
At the close of the hearing, the court stated that it would issue
the proposed order and again deferred deciding whether to institute
criminal contempt proceedings until after Medoff produced the
remaining discovery contemplated by the order.
On February 5, 2024, after discovery closed, the SEC
filed a status report summarizing what it had learned from Medoff's
production of information and documents. The SEC reported, among
other things, that Medoff had produced all the information that he
was required to produce by the December 1, 2023, order; that Medoff
was in the process of producing additional documents sought by the
SEC based on what it learned in discovery; that Medoff had, since
2016, controlled Nova Capital and, through it, had engaged in the
offer and sale of securities in violation of the 2016 consent
judgment; that Medoff had used the alias "Alexander Carlin" in
connection with his Nova Capital work; that Nova Capital had
received approximately $1.8 million in fees in violation of the
2016 consent judgment; that Medoff's personal net benefit from the
$1.8 million in fees was worth approximately $1.675 million; that
the SEC subsequently would be moving for a final order of civil
contempt; and that the SEC would be seeking, among other things,
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that Medoff disgorge the money that he obtained from violating the
2016 consent judgment.
On February 6, 2024, the district court responded with
an order stating that the SEC's February 5, 2024, status report
"suggests that promptly initiating criminal contempt proceedings
for [Medoff's alleged violations of the 2016 consent judgment] may
be most appropriate for several reasons, including but not limited
to the risk that an order of disgorgement if Medoff is held in
civil contempt may be futile." Therefore, the court directed the
SEC to file a memorandum and affidavit addressing whether Medoff
had the ability to pay $1.675 million, or any other substantial
sum, if ordered to do so. The court also invited, but did not
require, Medoff to do the same.
The next day, the SEC filed the required memorandum and
affidavit. These documents represented that Medoff had received
approximately $200,000 annually for work he performed through Nova
Capital from June 2016 through November 2023; that Medoff had spent
or distributed all that money and had a negative net worth; that
Medoff was the beneficiary of a family trust with approximately
$920,000 in liquid assets; that the trust presently paid Medoff
approximately $2,200 per month; that the SEC did not include the
trust assets in assessing Medoff's net worth because Medoff did
not possess or exercise control of those assets; and that Medoff
had informed the SEC that he had a possible opportunity for future
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non-securities-related income that he could use to pay down a
monetary penalty.
The day after the SEC's filing, Medoff filed his own
affidavit, which stated that he was "deeply apologetic to the Court
[for failing] to comply with the 2016 [consent judgment]." The
affidavit also stated that Medoff had paid $10,000 toward the
disgorgement and civil penalties owed from that judgment; that he
did not have a "current ability to pay a substantial disgorgement
or civil penalty" but was "in the process of arranging three
separate revenue streams that, if successful, [would] enable [him]
to pay the disgorgement penalties over time"; and that, going
forward, he was willing to pay the SEC twenty percent of his
quarterly income from the trust and other sources.
On February 9, 2024, the district court convened another
hearing on whether it should institute criminal contempt
proceedings against Medoff. At that hearing, counsel for the SEC
confirmed its earlier representation that the SEC does not have
the authority to seek criminal contempt. In doing so, SEC counsel
acknowledged that, on a couple of occasions, the SEC had "weighed
in" with a U.S. attorney's office about that office initiating a
criminal contempt proceeding but had been told that the office
could not act without a court order. SEC counsel also represented
that the SEC believed that Medoff had a negative net worth of
approximately $200,000; that he lacked any assets to pay the fine
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imposed in the 2016 consent judgment or any order of disgorgement;
but that he was no longer engaging in conduct prohibited by the
2016 consent judgment.
Medoff's counsel opposed the initiation of criminal
contempt proceedings by emphasizing that Medoff had been
cooperative with the SEC over the preceding several months.
Medoff's counsel also reiterated statements in his client's
affidavit that Medoff would apportion twenty percent of his
personal income to pay down his debt and that Medoff had some
potential income streams that he could earn consonant with the
2016 consent judgment. Medoff's counsel concluded by stating: "I
think we've demonstrated Mr. Medoff's intent to cooperate
and . . . just ask . . . for a little bit more time to prove it."
The district court next heard from Medoff himself, who
attributed his violation of the 2016 consent judgment to
"confusion" because he was an "active drug addict" when the
judgment was entered. The court asked Medoff when he had stopped
using drugs, and Medoff responded "[t]hree years ago, Your Honor."
The court followed up by asking whether, during the three years
since he stopped using drugs, Medoff had continued to work on
behalf of Nova Capital using an alias. Medoff confirmed that he
had. The court then announced its intention to issue a written
order requiring Medoff to show cause why he should not be held in
criminal contempt. No party objected to the court initiating
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criminal contempt proceedings without referral to the U.S.
Attorney's Office for evaluation and, if appropriate, a grand jury
indictment.
On February 12, 2024, the district court issued the
contemplated order. The order invoked section 401(3) of title 18,
which, in pertinent part, empowers a court to punish contempt of
its authority through "[d]isobedience or resistance to its lawful
writ, process, order, rule, decree, or command." The order also
invoked Federal Rule of Criminal Procedure ("Rule") 42(a)(1),
which provides that a person prosecuted for criminal contempt shall
receive notice from the court of the time and place of trial,
reasonable time to prepare a defense, a statement of the essential
facts constituting the charged criminal contempt, and a
description of it as such. The order charged Medoff with
"knowingly and willfully violating . . . the 2016 [consent
judgment] by engaging in the alleged offer and sale of securities
by his conduct related to Nova Capital International LLC."
Pursuant to Rule 42(a)(2), the district court appointed
the U.S. Attorney for the District of Massachusetts to prosecute
the case.1 The court also set the trial for April 1, 2024, and,
1 By its terms, Rule 42(a)(2) obligates the court to
"request" that the criminal contempt proceeding be prosecuted by
an attorney for the government and contemplates a discretionary
decision by the government whether to accept the request. But no
party objected to the court's appointment of the government without
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pursuant to Rule 42(a)(3), released Medoff pending a hearing on
whether he should be detained pending trial. Because the court
determined that incarceration for a period of more than six months
might be necessary to serve the purposes of sentencing, it ruled
that Medoff was entitled to a jury trial. See Codispoti v.
Pennsylvania, 418 U.S. 506, 512, 516-17 (1974) (indicating that
the jury-trial right attaches to a criminal contempt charge
potentially resulting in a sentence of more than six months in
prison); Rule 42(a)(3) ("A person being prosecuted for criminal
contempt is entitled to a jury trial in any case in which federal
law so provides"). And because the alleged contempt did not
involve disrespect toward or criticism of the court personally,
the court stated that it would preside in the contempt proceeding.
See Rule 42(a)(3) ("If the criminal contempt involves disrespect
toward or criticism of a judge, that judge is disqualified from
presiding at the contempt trial or hearing unless the defendant
consents.").
In its order, the district court further elaborated on
why it had chosen to initiate a criminal contempt proceeding. The
court started by observing that civil and criminal contempt
proceedings serve different purposes. See United States v.
such a request or, as we shall describe, to the government's tacit
acceptance of the appointment by timely entering an appearance and
subsequently prosecuting the case.
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Marquado, 149 F.3d 36, 39(1st Cir. 1998). It explained that sanctions for civil contempt are meant to coerce compliance with court orders, while sanctions for criminal contempt are meant to punish violations of, and to deter future violations, of such orders. Seeid.
at 39–40; Yates v. United States,355 U.S. 66, 75
(1957). After acknowledging that a court should resort to criminal sanctions only after determining, for good reason, that civil sanctions would be insufficient, the court identified two reasons for charging Medoff with criminal contempt. See Shillitani v. United States,384 U.S. 364
, 371 n.9 (1966).
First, the district court stated that "holding Medoff in
civil contempt would be futile" because Medoff lacked the means to
pay an appropriate penalty or disgorgement order, and because
Medoff's history of flouting court orders even after serving jail
time suggested that fear of prison would not deter him from
disobeying a civil contempt order.2 Second, the court stated:
[T]here is far more than probable cause to
believe that Medoff knowingly, willfully, and
repeatedly disobeyed the 2016 [consent
judgment]. There is, therefore, reason to be
concerned that Medoff may continue to present
a danger of committing crimes and that his
incarceration may be necessary to protect the
public. In any event, it is important to the
2 Despite its concerns about futility, the court
authorized the SEC to continue exploring the possibility of
disgorgement and other civil sanctions pursuant to its motion to
show cause in the civil action. But the court also stated that it
"intend[ed] to resolve the criminal charge before conducting civil
contempt proceedings." The civil action remains ongoing.
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administration of justice to demonstrate that
court orders cannot be violated with impunity.
If proven, or admitted, a criminal sanction
for contempt will be justified to punish
Medoff, to protect the public, and to deter
him and others from engaging in comparable
conduct in the future. See Yates, 355 U.S. at
74.
C.
We now reach the criminal contempt proceedings that give
rise to this appeal. The case began with a flurry of pretrial
activity. On February 12, 2024, the district court issued a
pretrial order reiterating that trial would commence on April 1,
2024; directing the parties to confer and report by February 20,
2024, whether they had either reached an agreement to resolve the
case or would like a continuance until February 27, 2024, to
attempt to do so; and setting deadlines for various pretrial
disclosures.
On February 21, 2024, the district court issued an order
permitting Medoff's counsel in the 2016 civil enforcement action
to withdraw, granting Medoff's request for the appointment of CJA
counsel (which was supported by the required financial affidavit),
and appointing Attorney Peter Horstmann to serve as CJA counsel.
On February 22, 2024, Assistant U.S. Attorney {"AUSA") Leslie
Wright appeared for the government. Again, as we have mentioned,
at no point did the government indicate an unwillingness to accept
the court's appointment to prosecute the case. Cf. Fed R. Crim.
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P. 42(a)(2) ("The court must request that the contempt be prosecuted
by an attorney for the government, unless the interest of justice
requires the appointment of another attorney. If the government
declines the request, the court must appoint another attorney to
prosecute the contempt.").
Five days after his appointment, Attorney Horstmann
filed an assented-to motion to extend the relevant deadlines and
continue the trial. The motion stated that Attorney Horstmann
needed more time to prepare and had other trials scheduled to begin
on April 1, 2024, and June 17, 2024. The motion also stated that
AUSA Wright had a trial scheduled to start on July 15, 2024. The
motion requested that trial be continued to an unspecified,
mutually convenient date. The next day, on February 27, 2024, the
parties filed a joint status report requesting additional time to
confer about potentially resolving the case.
On February 28, 2024, a magistrate judge ordered Medoff
released on conditions pending trial. The conditions did not
include drug testing or drug treatment. The day following Medoff's
release, the district court issued an order granting the
assented-to motion to extend deadlines and continue the trial; it
also extended until March 12, 2024, the parties' deadline to report
whether they had reached an agreement to resolve the case. This
order did not set a new trial date.
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On March 12, 2024, the parties filed a joint status
report stating that they did not anticipate resolving the case and
that a trial would last one or two days. The report also stated
that Medoff would file discovery motions and might request the
district court to recuse itself and to dismiss the criminal
contempt proceeding based on collateral and/or judicial estoppel.
On March 14, 2024, the district court filed a responsive
order asking Attorney Horstmann to report whether he still expected
his trial scheduled for April 1, 2024, to begin on that date. The
order further directed Medoff to file any recusal motion by March
20, 2024. It also ordered Medoff to include with any such motion
a memorandum addressing (1) why disqualification was warranted
considering that the alleged criminal contempt did not involve
disrespect or criticism of the court, see Fed. R. Crim. P.
42(a)(3); and (2) if the motion to recuse were to be based in whole
or in part on section 455(a) of title 28, which requires the court
to recuse where the court's "impartiality might reasonably be
questioned," to discuss the legal standards for applying the
statute. Finally, the order stated that trial would begin on April
22, 2024, if the court were to deny any motion to recuse.
On March 20, 2024, Medoff filed two motions: a motion to
recuse under section 455(a) and an assented-to motion to continue
the trial date from April 22, 2024, to an unspecified, mutually
convenient date. The recusal motion argued that the following
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rulings and conduct gave rise to an appearance of bias that would
cause a reasonable observer to question the district court's
impartiality: (1) the court had shown a "fixation" with initiating
criminal contempt proceedings by repeatedly mentioning its
likelihood of doing so in the months following the filing of the
SEC's motion to show cause; (2) the court had raised the
possibility of charging Medoff with criminal contempt without the
SEC requesting that it do so; (3) the court had rushed the
proceedings by initially scheduling a trial date for just more
than six weeks after their initiation; (4) the court had expressed
an unfounded concern, based on Medoff's prior conduct, that he
constituted a "danger" to the community and was a candidate for
pretrial detention; and (5) the court had sandbagged Medoff by
initiating the criminal case after leading Medoff to believe that
he could avoid criminal liability by cooperating with the SEC to
resolve the motion to show cause.3
3 Medoff later raised this sandbagging argument in an
April 18, 2024, motion captioned "Motion in Limine to Dismiss
Criminal Case or to Suppress Involuntary Statements Induced by
Promissory Estoppel." In an April 23, 2024, memorandum and order,
the district court denied the motion, noting that, in affording
Medoff the opportunity to resolve the SEC's motion to show cause,
the court had repeatedly advised him that it was doing so "without
prejudice to its right to institute criminal contempt
proceedings." Medoff does not challenge this ruling or otherwise
raise sandbagging as a concern on appeal. Therefore, we will say
nothing more on the issue.
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On March 25, 2024, the district court entered a
memorandum and order denying the assented-to motion to continue
the trial. The order stated: "Both the motion for a lengthy
continuance of the trial date and Medoff's motion to recuse suggest
that [Medoff's] counsel . . . may not understand the elements of
criminal contempt." The order directed the parties' counsel to
file by March 28, 2024, affidavits stating whether they had
reviewed all the pleadings, hearing and deposition transcripts,
and documents produced to the SEC since the filing of the SEC's
motion to show cause. By way of explanation, the court stated:
"The information is necessary for the court to make a properly
informed decision on whether any further continuance of the trial
date is justified." The parties' counsel timely complied.
Meanwhile, on March 26, 2024, the government filed a
response to Medoff's recusal motion under section 455(a). The
response stated:
[I]n an abundance of caution -- and because
the Court has itself referred this matter to
the government for prosecution -- the
government defers to the Court as to whether,
in the unique circumstances in which a court
has sua sponte initiated criminal contempt
proceedings, the various defense contentions
in this case meet the "high threshold . . .
required to satisfy" the [section] 455(a)
recusal standard . . . based on the need to
avoid the "objective appearance" of
partiality.
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(ellipses in original) (quoting Liteky v. United States, 510 U.S.
540, 558 (1994) (Kennedy, J., concurring)). On appeal, the
government remains neutral on the recusal question and accordingly
has declined to respond to Medoff's argument in this Court.
On April 9, 2024, the district court convened a hearing
on Medoff's motion to recuse. At the outset, the court expressed
displeasure that the U.S. Attorney's Office had taken no position
on the motion and doubt that it intended to properly prosecute the
criminal contempt case. After hearing from Medoff's counsel, the
court denied the motion. In doing so, the court reiterated its
reasons for initiating a criminal contempt action, recited the
applicable legal standards, and rejected the specific arguments
made in Medoff's motion. The court emphasized that, in its view,
there was no basis for a reasonable person to question its
impartiality.
In particular, the district court stated (1) that what
Medoff described as its "fixation" on the likelihood of a criminal
contempt proceeding was better understood as its effort to protect
Medoff's rights and to allow him to make informed decisions about
whether and how to cooperate in the civil case; (2) that the SEC's
failure to recommend criminal contempt was meaningless because, as
the agency explained, it lacked the authority to do so; (3) that
the initially contemplated April 1, 2024, trial date was
appropriate given the uncontested facts, the months of warnings
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that the court had given about the likelihood of criminal contempt
proceedings, and then-counsel's knowledge of the case;4 and (4)
that the statement regarding Medoff's possible pretrial detention
was nothing more than a statement of what the law requires when a
court initiates a criminal contempt proceeding, see 18
U.S.C. § 3142; Fed. R. Crim. P. 42(a)(3), 46.
The district court concluded the hearing by stating that
Medoff's motion to recuse "appears . . . frivolous" and "to be an
effort to . . . further delay the trial." The court added: "It
is, in my view . . . an effort to manipulate the system for
strategic purposes, perhaps to obtain another judge who would have
to do a great deal of work to prepare and, as I say . . . to
further delay this matter." Medoff's counsel responded: "I would
just like to say that there's no judge shopping going on here.
There's absolutely none. . . . I'm not shopping for a better
judge." The court replied: "Okay, maybe for delay . . . ." To
which Medoff's counsel responded: "Maybe. Maybe righteous delay."
The court then delayed the trial date for another week, to April
29, 2024.5
4 On February 12, 2024, the date on which the district
court set April 1, 2024, as the trial date, counsel in the civil
action had not yet withdrawn. As noted above, Attorney Horstmann
was not appointed CJA counsel until February 21, 2024.
5 On April 23, 2024, Medoff filed a notice of appeal of
the district court's April 9, 2024, order denying his motion to
recuse. Perhaps recognizing that this interlocutory order was not
- 23 -
On April 16, 2024, Medoff filed an assented-to
"emergency" motion for a hearing on a proposed Rule 11(c)(1)(C)
plea agreement. The motion sought an expedited hearing because of
the impending trial date and filing deadlines. This binding plea
agreement, if accepted, would have required the district court to
sentence Medoff to zero to three months in prison followed by
twelve months of supervised release.
The following day, the district court issued a written
memorandum and order denying the motion and rejecting the plea
agreement. The court explained that, based on its understanding
of Medoff's criminal history, a zero-to-three-month sentence would
involve a downward variance, as the applicable GSR called for a
sentence of four to ten months. But, in the court's view, there
were likely no justifiable reasons for such a downward variance.
See U.S.S.G. § 6B1.2(c)(2) (stating that a court may accept a
Rule 11(c)(1)(C) plea requiring a sentence outside the applicable
guideline sentencing range only if "(A) the agreed sentence is
outside the applicable guideline range for justifiable reasons;
and (B) those reasons are set forth with specificity in the
statement of reasons form"). In reaching this conclusion, the
subject to immediate appeal, see 28 U.S.C. § 1292, Medoff
subsequently withdrew the notice, and, on May 8, 2024, filed a
petition for a writ of mandamus in this Court. The petition
sought, inter alia, the district court's recusal. About a week
later, we denied Medoff's petition.
- 24 -
court noted that, given its prior ruling that Medoff had a
jury-trial right because a six-month sentence might not be
sufficient to serve the interests of sentencing, the parties should
have foreseen that the court would reject a plea agreement
requiring the imposition of a sentence of not more than three
months. And the court also opined that, considering the case's
travel, the proposed plea agreement may have been submitted for
purposes of delay.
On April 23, 2024, citing medical reasons, the district
court rescheduled a pretrial conference (previously scheduled for
April 26, 2024) to April 29, 2024, and rescheduled the trial to
May 20, 2024. On April 26, 2024, the court issued a memorandum
and order directing that Medoff attend the pretrial conference and
that the parties be prepared to address whether Medoff's conditions
of release should be amended to include drug testing and, if
appropriate, drug treatment. The court explained that it was
raising the issue because Medoff's appearance and conduct at the
April 9, 2024, hearing on the recusal motion had caused it concern
that Medoff once again was using illegal drugs.
Meanwhile, also on April 26, 2024, the parties filed a
joint motion for leave to file a motion for a hearing on a second
proposed Rule 11(c)(1)(C) plea agreement. This time the proposed
plea agreement would have bound the court to impose a sentence in
the four-to-ten months range, followed by thirty-six months of
- 25 -
supervised release, and carried with it a government
recommendation for a four-month sentence.
At the April 29, 2024, pretrial conference, the district
court denied the motion for a hearing on the second proposed plea
agreement and rejected the agreement. In doing so, the court
questioned whether the voluminous filings that the government was
forced to prepare and submit in getting ready for trial following
the rejection of the first proposed plea agreement should lead
Medoff to lose the two-level downward adjustment for acceptance of
responsibility that the parties had agreed to in predicting the
applicable GSR. See U.S.S.G. § 3E1.1, cmt. n.1(H) (stating that
"the timeliness of the defendant's conduct in manifesting the
acceptance of responsibility" should be accounted for in
evaluating whether to give a downward adjustment). If Medoff were
not given this adjustment, his GSR would be eight to fourteen
months, and the government's recommended sentence of four months
would involve a downward variance for which there might not be
justifiable reasons. The court also expressed concern that
Medoff's criminal history -- which included unscored criminal
history -- might under-represent the risk that he would engage in
future criminal conduct. If this were so, the court indicated, it
might be inclined to give an above-guidelines sentence.
At the April 29, 2024, pretrial conference, the district
court also addressed Medoff's release conditions. The court
- 26 -
explained that it had become concerned that Medoff might be using
drugs again because, at the April 9, 2024, hearing, Medoff had
placed his head on the table for a long period of time, knocked
over a glass of water, and was then permitted to leave the
courthouse, at counsel's request, before the hearing concluded.
Medoff's counsel advised the district court that Medoff
was ill at the April 9, 2024, hearing and argued against imposing
additional release conditions. At one point during his counsel's
argument, and against the advice of counsel (who repeatedly urged
Medoff to remain silent), Medoff interrupted to advise the court
that he is "a documented freebase cocaine addict"; that his drug
of choice "is freebase cocaine, not heroin, not opiates, not
anything that would make [him] sleepy"; that he had a severe chest
cold at the earlier hearing; and that if he had been using cocaine,
he would have been frenetic and not lethargic.
After hearing argument and Medoff's comments, the
district court ordered that drug testing and, if appropriate, drug
counseling be incorporated into Medoff's release conditions. The
court also ordered an immediate drug test to set a baseline. The
test indicated Medoff's use of marijuana and cocaine. Afterwards,
Medoff admitted to having consumed marijuana edibles that morning.
The court did not revoke Medoff's pretrial release, but it warned
him that he faced a substantial risk of revocation if he were to
test positive again.
- 27 -
Finally, the district court concluded the April 29,
2024, pretrial conference by questioning whether it had been
appropriate to appoint CJA counsel for Medoff. The court expressed
concern about Medoff's representation of indigency and failure to
make any fine or disgorgement payments given that he was the
beneficiary of a trust holding more than $900,000 for his benefit
and had received more than $1.6 million for conduct that violated
the 2016 consent judgment.
On May 14, 2024, the probation department filed a
petition to issue a summons for Medoff to appear because he had
tested positive for cocaine use on three additional occasions
following his initial positive test. The following day, Medoff
filed a motion to enter a guilty plea, without any agreement with
the government. See Fed. R. Crim. P. 11(a)(1). On May 16, 2024,
the district court convened a hearing to address these filings.
At the hearing, Medoff admitted that he had violated the 2016
consent judgment and pleaded guilty to the charge of criminal
contempt. The court accepted Medoff's plea and scheduled
sentencing for August 7, 2024. The court also again raised
questions about the accuracy and completeness of the financial
statement that Medoff had filed in support of his request for CJA
counsel and placed a gag order on Medoff to preclude him from
communicating with one Mark Levy, a person to whom Medoff allegedly
owed money and who the court suspected of hiding assets for Medoff.
- 28 -
In addition, the district court continued Medoff's
release on conditions prior to sentencing. The court said it was
a close question whether to order that Medoff be taken into custody
and stated that it was not sure whether it was correct to find by
clear and convincing evidence, as it did, that Medoff was unlikely
to flee or to pose a danger to the safety of any other person.6
The court did, however, impose several additional conditions on
Medoff's release. In any event, on May 31, 2024, after additional
drug tests showed continued cocaine use, and after Medoff sent the
probation department an email making clear that he had been
dishonest about his drug use, the department again petitioned the
court to issue a summons for Medoff to appear. On June 3, 2024,
following a hearing on the petition, the court revoked Medoff's
supervised release.
On August 5, 2024, after reading the presentence report
("PSR") prepared by the probation department for Medoff's
sentencing, the district court issued a memorandum and order
directing the parties to be prepared to discuss at sentencing
several issues bearing on whether it should impose a variant
sentence above the applicable GSR, which the PSR set at four to
ten months in prison. In particular, the court intended to explore
6 The record contains evidence of unscored criminal
conduct involving violent and threatening behavior by Medoff over
the years.
- 29 -
whether Medoff should be entitled to a two-level reduction for
acceptance of responsibility (as the PSR recommended with the joint
agreement of the parties), notwithstanding that he had repeatedly
lied to the court and the probation department about his drug use;
whether Medoff's criminal history category of II substantially
understated the seriousness of his criminal history and the
likelihood that he would commit future crimes; and whether it
should attach significance to the fact that, although Medoff was
not shown to have caused any victim to suffer a loss, he had
nonetheless received approximately $1.675 million for violating
the 2016 consent judgment and had never paid the fine or
disgorgement ordered in that judgment. The court indicated that
it was considering an upward variant sentence of thirty months.
On August 7, 2024, the district court conducted Medoff's
sentencing hearing. Despite its previous reservations, the court
agreed to award Medoff a two-level reduction for acceptance of
responsibility, citing his cooperation with the SEC after it filed
its motion to show cause and stating that it would instead consider
Medoff's lying in the context of deciding whether to impose an
upward variance. This led the court to agree with the PSR that
Medoff's total offense level was eight; his criminal history
category was II; his GSR was four to ten months in prison followed
by twenty-four to sixty months of supervised release; and his fine
- 30 -
range was $2,000 to $20,000 (with a maximum of $250,000) plus a
$100 special assessment.
The district court then invited counsel to speak.
Counsel for the SEC took no position on what sentence should be
imposed but stated that the injunctive relief that Medoff flouted
"is one of the tools that the SEC uses to achieve its aim of
protecting investors." Government counsel recommended a sentence
of ten months -- the high end of the GSR. In doing so, government
counsel expressed agreement with the court that civil contempt
would have been an insufficient remedy. Government counsel also
explained that, because this was not a case that the government
investigated or charged, the government's understanding of the
facts evolved considerably as the case proceeded. As a result,
and as the government learned more about Medoff's behavior and
history, its sentencing recommendations grew more severe.
Government counsel did not express opposition to a variance above
the GSR and agreed with the court's suggestion that the case
involved aggravating factors not accounted for by the GSR.
Medoff's counsel argued for a time-served sentence,
which would have amounted to about three months in prison.
Medoff's counsel emphasized that his conduct had not caused anyone
harm and was fueled by a now-controlled drug addiction. Medoff's
counsel also contended that Medoff's violation of the 2016 consent
- 31 -
judgment was not in and of itself dangerous to any purchaser of
securities.
Ultimately, the district court imposed an upward
variance and sentenced Medoff to twenty months in prison and
thirty-six months of supervised release. The court also imposed a
$20,000 fine, to be paid starting immediately, and a $100 special
assessment.
In imposing this sentence, the district court stated
that it had considered a sentence of thirty months but decided
that twenty months was sufficient and not more than necessary to
serve the purposes of sentencing. See 18 U.S.C. § 3553(a) (setting
forth the factors to be considered in imposing a sentence). The
court observed that, even after crediting Medoff's cooperation
with the SEC as a mitigating factor, an upward variance was
warranted because a criminal history category of II substantially
underrepresented both the seriousness of Medoff's criminal
history -- which included a considerable amount of uncharged and
unscored criminal conduct -- and the likelihood that he would
commit future crimes. The court also explicitly discussed each of
the section 3553(a) sentencing criteria to explain how they
required the court to account for several aggravating factors that
militated in favor of an above-guidelines sentence. Medoff raised
no objections to the court's sentencing analysis when afforded an
opportunity to do so.
- 32 -
II.
As we noted at the outset, Medoff presents two arguments
on appeal. Primarily, he contends that the district court erred
in denying his motion to recuse. Alternatively, he asserts that
his sentence should be vacated because it was both procedurally
and substantively unreasonable. We begin with recusal.
A.
Medoff's challenge to the district court's denial of his
motion to recuse proceeds along two lines. The first contests the
lawfulness of the district court's decision to initiate a criminal
proceeding on its own rather than referring the case to the U.S.
Attorney's Office for evaluation and, if appropriate, indictment
by a grand jury. The second focuses on the court's rulings and
comments following the SEC's filing of its motion to show cause in
the civil case and argues that, when viewed collectively by a
reasonable observer, the observer would conclude that the court's
actions gave rise to an appearance of "partiality" requiring
recusal under section 455(a).
Medoff has waived his first argument for recusal. As
previously noted, Medoff never suggested below that the district
court lacked the authority to initiate a criminal contempt
proceeding absent a prior referral to the U.S. Attorney's Office
for evaluation and, if appropriate, a grand jury indictment. Nor
does Medoff argue on appeal that the court plainly erred in
- 33 -
proceeding as it did. We therefore decline to take up Medoff's
first line of argument and confine our analysis to Medoff's
argument that the court's rulings and comments required recusal
under section 455(a) because of an appearance of partiality. See,
e.g., United States v. Feleciano-Candelario, 128 F.4th 5, 16 (1st
Cir. 2025) (failure to argue that an unpreserved issue involved
plain error waives any claim for relief based on that issue).7
The showing that Medoff must make to prevail on this
argument is formidable. Again, section 455(a) requires that a
judge "disqualify himself in any proceeding in which his
impartiality might reasonably be questioned." Therefore, a judge
7 Two members of the United States Supreme Court have
suggested, in the related but not identical context where a trial
court appointed prosecutors under Rule 42(a)(2) after the
government declined its request to prosecute, that a trial court's
decision to prosecute anyway, without executive branch approval,
may raise separation of powers concerns and violate a defendant's
due process rights. See Donziger v. United States, 143 S. Ct.
868, 869-70 (2023) (Gorsuch, J., joined by Kavanaugh, J.,
dissenting from the denial of a writ of certiorari) ("By
interpreting Rule 42 as authorizing courts to make their own
decision to initiate a prosecution -- and even to override a
contrary decision by the Executive Branch -- the [decision below]
not only arrogated a power to the Judiciary that belongs elsewhere.
It allowed the district court to assume the 'dual position as
accuser and decisionmaker' -- a combination that violates the due
process rights of the accused." (quoting Williams v. Pennsylvania,
579 U.S. 1, 9(2016))); see also Young v. United States ex. rel. Vuitton et Fils, S.A.,481 U.S. 787, 815-25
(1987) (Scalia, J.,
concurring in the judgment) (arguing in a case involving
court-appointed, private prosecutors that the Article III judicial
power does not permit federal judges to seek out violators of court
orders in order to punish them). For the reasons stated, we do
not engage this complex and unsettled issue.
- 34 -
considering a motion to recuse must ask whether "the facts asserted
'provide what an objective, knowledgeable member of the public
would find to be a reasonable basis for doubting the judge's
impartiality.'" In re Boston's Children First, 244 F.3d 164, 167(1st Cir. 2001 (quoting In re United States,666 F.2d 690, 695
(1st Cir. 1981)). It is true, as Medoff notes, that "doubts ordinarily ought to be resolved in favor of recusal." In re United States,441 F.3d 44
, 56 (1st Cir. 2006) (quoting In re United States,158 F.3d 26, 30
(1st Cir. 1998)). But the Supreme Court
has provided guidance, which we summarize immediately below, on
what does and does not give rise to objectively reasonable doubts
about a judge's partiality. Medoff's brief does not mention, let
alone endeavor to apply, this guidance.
As a threshold matter, as the Supreme Court explained in
Liteky, "judicial rulings alone almost never constitute a valid
basis for a bias or partiality motion." 510 U.S. at 555. "Almost invariably, [such rulings] are proper grounds for appeal, not for recusal."Id.
Moreover, a judge's opinions that are, as here, premised on "facts introduced or events occurring in the course of the current proceedings, or of prior proceedings," and not on a source outside of judicial proceedings (known as an "extrajudicial source"), "do not constitute a basis for a bias or partiality motion unless they display a deep-seated favoritism or antagonism that would make fair judgment impossible." Id.; seeid.
at 558
- 35 -
(Kennedy, J., concurring in the judgment)
("[U]nder [section] 455(a), a judge should be disqualified only if
it appears that he or she harbors an aversion, hostility[,] or
disposition of a kind that a fair-minded person could not set aside
when judging the dispute."); see also Caperton v. A.T. Massey Coal
Co., 556 U.S. 868, 889(2009) (quoting Liteky,510 U.S. at 558
(Kennedy, J., concurring in the judgment)). Consequently, judicial remarks "that are critical or disapproving of, or even hostile to, counsel, the parties, or their cases, ordinarily do not support a [section 455(a)] bias or partiality challenge." Liteky,510 U.S. at 555
.8
8 In Liteky, the Supreme Court provided the following
extensive explanation for the demanding showing one must make to
establish a judge's partiality. We quote in its entirety because
of its relevance to our evaluation of Medoff's recusal argument:
Not all unfavorable disposition towards an
individual (or his case) is properly described by
[the words "bias" or "prejudice," which constitute
the elements of section 455(a) partiality, see id.
at 552]. One would not say, for example, that world
opinion is biased or prejudiced against Adolf
Hitler. The words connote a favorable or
unfavorable disposition or opinion that is somehow
wrongful or inappropriate, either because it is
undeserved, or because it rests upon knowledge that
the subject ought not to possess (for example, a
criminal juror who has been biased or prejudiced by
receipt of inadmissible evidence concerning the
defendant's prior criminal activities), or because
it is excessive in degree (for example, a criminal
juror who is so inflamed by properly admitted
evidence of a defendant's prior criminal activities
- 36 -
Moreover, whether a judge's impartiality might
reasonably be questioned is a determination ultimately committed
to the discretion of the district court. In re United States, 666
F.2d at 695. Given that reasonable minds may differ on this matter, we review a court's decision not to recuse under the highly deferential abuse-of-discretion standard. See United States v. Torres-Estrada,817 F.3d 376, 380
(1st Cir. 2016). In applying
that he will vote guilty regardless of the
facts). . . .
The judge who presides at a trial may, upon
completion of the evidence, be exceedingly ill
disposed towards the defendant, who has been shown
to be a thoroughly reprehensible person. But the
judge is not thereby recusable for bias or
prejudice, since his knowledge and the opinion it
produced were properly and necessarily acquired in
the course of the proceedings, and are indeed
sometimes (as in a bench trial) necessary to
completion of the judge's task. As Judge Jerome
Frank pithily put it: "Impartiality is not
gullibility. Disinterestedness does not mean
child-like innocence. If the judge did not form
judgments of the actors in those court-house dramas
called trials, he could never render decisions."
Also not subject to deprecatory characterization as
"bias" or "prejudice" are opinions held by judges
as a result of what they learned in earlier
proceedings. It has long been regarded as normal
and proper for a judge to sit in the same case upon
its remand, and to sit in successive trials
involving the same defendant. . . .
"Partiality" [within the meaning of section 455(a)]
does not refer to all favoritism, but only to such
as is, for some reason, wrongful or inappropriate.
Liteky, 510 U.S. at 550-52 (explaining why a finding of partiality
ordinarily must be premised on an "extrajudicial source")
(citation omitted) (emphasis in original).
- 37 -
this standard, we "will sustain the district court's ruling unless
we find that it cannot be defended as a rational conclusion
supported by a reasonable reading of the record." Id.(alteration omitted) (quoting United States v. Pulido,566 F.3d 52, 62
(1st
Cir. 2009)).9
When evaluated against the substantive law and our
standard of review, Medoff's argument for recusal is unconvincing.
Medoff advances nine reasons why the district court abused its
discretion in denying his recusal motion. Medoff says, first,
that the district court exhibited partiality by initiating a
criminal contempt proceeding even though the government had not
done so and even though the SEC took the position that such a
proceeding was unnecessary. But any suggestion that the
government's failure to initiate a criminal contempt proceeding
reflected disagreement with the court about the propriety of such
a proceeding is belied by its acceptance, without objection, of
9 We have at times described the applicable appellate
standard of review as asking whether an "objective, reasonable
member of the public, 'fully informed of all the relevant facts,'
would fairly question the trial judge's impartiality." In re
United States, 441 F.3d at 56-57 (quoting In re United States, 158
F.3d at 31). This formulation should not be understood to require
reversal if a single, objectively reasonable person could fairly
question a judge's impartiality. Rather, consistent with how
abuse-of-discretion review operates, the denial of a recusal
motion will be upheld if, as we have just stated, reasonable minds
may differ about the judge's ruling.
- 38 -
the court's appointment to prosecute Medoff, and its subsequent
prosecution of him. Cf. Fed. R. Crim. P. 42(a)(2) (expressly
contemplating government denial of a court's request to prosecute
a criminal contempt).10
Moreover, Medoff misreads the record in twice suggesting
that the SEC opined that a criminal contempt proceeding was
unnecessary. As we have noted, the SEC counsel disclaimed any
authority to initiate a criminal contempt proceeding. SEC counsel
also clarified that, in stating that further sanctions were
unnecessary in the November 23, 2023, joint status report, the
agency intended only to say that it regarded further civil
sanctions as unnecessary. The agency never expressed a view on
the district court's conclusion that a criminal contempt
proceeding was appropriate.
Medoff next contends that the district court's status as
"the party aggrieved" by Medoff's violation of its 2016 consent
10 In his reply brief, Medoff states that the government
"express[ed] the view that criminal contempt was not warranted."
Medoff also states that the district court "dismiss[ed] the
government's view of recusal," implying that the government
tacitly agreed with him that recusal was appropriate. Neither
statement is supported by the record. As to the former statement,
the record contains no "express" indication from the government
that a criminal contempt prosecution was unwarranted. Indeed, as
we have just noted, the government's acceptance of the court's
appointment and subsequent prosecution of the case would seem, if
anything, to reflect a contrary view. As to the latter statement,
we have no basis to disregard the government's statement that it
had no position on Medoff's motion. There was thus no "government
view" of the recusal issue for the district court to dismiss.
- 39 -
judgment rendered it insufficiently detached to maintain
impartiality. In support of the argument, Medoff points to the
court's repeated statements that it does not issue orders that it
does not intend to enforce; its description of Medoff's recusal
motion as "frivolous"; its chastisement of the government for not
opposing Medoff's motion; and its related concern that the
government would not properly prosecute the case.
We note preliminarily that the frustration expressed in
these statements was directed at counsel for their conduct in the
civil and criminal cases, and not at Medoff himself. Moreover, as
we have noted, Medoff does not argue, let alone demonstrate, that
there is reason for treating these statements as outside the rule
that "remarks during the course of a trial that are critical or
disapproving of, or even hostile to, counsel, the parties, or their
cases, ordinarily do not support a bias or partiality challenge."
Liteky, 510 U.S. at 555; see also United States v. Caramadre,807 F.3d 359, 374-75
(1st Cir. 2015) (concluding that judge's actions
"did not cross the Liteky line" though judge, inter alia,
characterized party's motion as "entirely meritless, bordering on
frivolous" and "an incredibly cynical and disturbing effort to
manipulate the court and the criminal justice system").
Medoff's third ground supporting recusal highlights the
speed with which the district court sought to hold the criminal
contempt trial and the court's repeated expressions of concern
- 40 -
that Medoff's counsel was attempting to unduly delay it. Medoff
notes that the court set a trial date fewer than forty-five days
from the date on which it instituted the criminal proceeding and
states: "When defense counsel objected and requested a
continuance -- with the government's assent -- the district court
denied the request." This argument again misstates the record.
As we have explained, on February 29, 2024, the court granted newly
appointed Attorney Horstmann's February 26, 2024, motion to
continue the trial date. Subsequently, after setting trial for
April 22, 2024, and initially denying Medoff's motion to continue
trial further, the court continued the trial date twice more: to
April 29, 2024, and then to May 20, 2024. Medoff's remedy for
these case-management "judicial rulings" was "appeal,
not . . . recusal." Liteky, 510 U.S. at 555.11
The remaining grounds that Medoff asserts in support of
his motion for recusal stem from events and comments that
post-dated the motion's filing and resolution. Medoff would have
us infer partiality from the district court's rejections of the
two proposed Rule 11(c)(1)(C) plea agreements; doubts the court
expressed about Medoff's entitlement to credit for acceptance of
11 To the extent that Medoff seeks to have us infer
partiality from the district court's repeated assertions that
counsel was attempting to unduly delay the trial, we note that
counsel acknowledged to the court that Medoff's recusal motion was
"maybe" motivated, at least in part, by a "righteous" desire for
delay.
- 41 -
responsibility before awarding the credit and the adequacy of
Medoff's criminal history score, given his unscored criminal
history; concerns the court expressed about whether Medoff's
punishment should be enhanced because of his dishonesty with the
court and the probation department about his drug use; concerns
the court expressed about Medoff's dangerousness, given his
history of violating securities laws and court orders; and concerns
the court expressed about whether Medoff was hiding assets to avoid
paying prior fines and disgorgement orders and to secure
court-appointed counsel.
Because these grounds post-dated the filing and
disposition of Medoff's motion to recuse, they were, of course,
not considered by the district court. Thus, they cannot themselves
directly ground a ruling that the court abused its discretion in
denying the motion. Yet even assuming their relevance to the
court's state of mind during the criminal case, they do not affect
our judgment. Medoff treats the wrongfulness of these actions and
comments as largely self-evident. See Liteky, 510 U.S. at 552
(explaining that that a judge's predisposition towards a litigant
must be "wrongful or inappropriate" to constitute partiality
within the meaning of section 455(a)). But in our view, these
actions and comments, whether they are considered individually or
in combination, do not suggest a wrongful predisposition against
Medoff, which (again) the Supreme Court has defined as a
- 42 -
"deep-seated . . . antagonism" on the part of the court "that
would make fair judgment impossible." Liteky, 510 U.S. at 555.
The record, which we have described in detail,
demonstrates that the district court regarded Medoff's extensive
history of flouting judicial orders as requiring a serious and
prompt response for which additional civil sanctions would be
inadequate. It also reveals a court troubled by a perceived
tendency on the part of the SEC to enter into unenforceable
settlement agreements and, consequently, committed to ensuring the
enforceability of the orders it issued. Neither view strikes us
as wrongful, inappropriate, or partial. Moreover, throughout the
civil and criminal proceedings, the court advised Medoff of, and
respected, his rights. Indeed, much of the court's commentary
offered transparency to the parties about the court's thinking,
which provided useful information on how the parties might go about
resolving the case. In sum, this case does not involve the "rarest
[of] circumstances" where a court shows "the degree of favoritism
or antagonism required" for recusal under section 455(a) "when no
extrajudicial source is involved." Liteky, 510 U.S. at 555. We
therefore conclude that the district court acted within its
discretion in denying Medoff's motion to recuse.
B.
Medoff alternatively argues that the twenty-month
upwardly variant sentence that the district court imposed was both
- 43 -
procedurally and substantively unreasonable.12 As to procedure,
Medoff contends that the court made two mistakes: (1) the court
erred in concluding that an upwardly variant sentence was necessary
to deter Medoff from engaging in additional criminal conduct and
to protect the public from further crimes; and (2) the court erred
in "entirely dismissing" national sentencing statistics indicating
that three months was the average sentence for defendants sentenced
under the same guideline and GSR, and in the same criminal history
category, as Medoff. As to substance, Medoff contends that his
twenty-month sentence was longer than necessary when viewed in the
light of various record data points. The government defends the
lawfulness of the sentence, arguing that Medoff has waived his
procedural objections and that, in any event, the sentence was
procedurally and substantively reasonable. Medoff denies waiver
of his procedural reasonableness arguments.
1.
We bypass the issue-preservation dispute because, even
assuming Medoff's procedural reasonableness arguments are properly
before us, they reveal no abuse of discretion. See United States
v. Waithe, 150 F.4th 16, 23 (1st Cir. 2025) (bypassing a dispute
12 Medoff has completed the custodial portion of his
sentence. His sentencing claim nevertheless remains a live
controversy because, if successful, he could seek an equitable
reduction in his supervised-release term. See United States v.
Reyes-Barreto, 24 F.4th 82, 86 (1st Cir. 2022).
- 44 -
over whether a procedural reasonableness challenge was preserved
where review of the issue, if preserved, would be for abuse of
discretion and where there was no such abuse). Medoff's first
procedural reasonableness argument is that his sentence cannot be
justified under the rationales of deterring "criminal conduct," or
protecting the public from "further crimes," 18
U.S.C. § 3553(a)(2)(B),(C), because his violation of the 2016 civil consent judgment was not itself "criminal conduct" and because he does not otherwise have a recent criminal conviction. Medoff's argument proceeds from a faulty premise. Violating the terms of an injunction in circumstances amounting to criminal contempt of that injunction is itself a crime -- one to which Medoff pleaded guilty. See18 U.S.C. § 401
(3). The court did not
commit procedural error in treating the factors specified in sub-
sections 3553(a)(2)(B), (C) as relevant to Medoff's sentence.
Medoff's second procedural reasonableness argument also
proceeds from a faulty premise. The district court did not
"entirely dismiss" the sentencing statistics to which Medoff
refers. Rather, after acknowledging the statutory obligation to
avoid unwarranted sentence disparities, id., § 3553(a)(6), and
after explicitly recognizing that the average sentence for
defendants with the same guidelines scores as Medoff was three
months, the court stated:
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But every case is unique. I don't know
anything about those cases [referenced in the
statistics]. I don't know if they're criminal
contempt cases, I don't know anything about the
history and characteristics of the people, but
I doubt that many, if any, have a combination
of factors that make this an exceptional case,
including decades of flagrantly violating
court orders, in some instances federal
security laws.
The court did not fail to consider the sentencing statistics; it
justifiably disagreed with Medoff's view of their importance. Here
too there was no abuse of discretion. See Waithe, 150 F.4th at
25.
2.
Medoff's substantive reasonableness argument is that his
twenty-month sentence was longer than necessary and therefore an
abuse of discretion. See id., 150 F.4th at 25 (reviewing for abuse
of discretion a preserved challenge to the substantive
reasonableness of a sentence). This argument is premised on two
underlying assertions. The first is that the district court
erroneously regarded him as a serial violator of federal securities
laws when he had only a single, decades-old criminal conviction
that was accounted for in his GSR and for which he was sentenced
to only probation and a fine. The second is that his twenty-month
sentence was incommensurate when evaluated in light of five
different record data points: (1) the sentences proposed in the
two Rule 11(c)(1)(C) plea deals (zero-to-three months and
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four-to-ten months) that the court rejected; (2) the applicable
GSR (four-to-ten months); (3) the government's recommended
sentence (ten months); (4) the sentencing statistics showing the
average sentence of defendants with Medoff's guidelines scores
(three months); and (5) the time Medoff served for two probation
violations in connection with the 1995 securities fraud
conviction.13
Medoff's first underlying argument is without merit.
Although the civil actions that the SEC brought against Medoff in
1993 and 2012 did not culminate in criminal convictions, they too
involved admitted "violations" of federal securities laws as that
term is commonly understood. The district court therefore did not
err in regarding them as such. Moreover, we have reviewed the
record with care and see no evidence that the court was unaware
either that the 1995 criminal conviction was accounted for by the
GSR or that Medoff's prior incarcerations were not, at least
directly, for violations of federal securities laws.
In emphasizing the five data points on which his second
underlying argument rests, Medoff does little to engage the
district court's discussion of the section 3553(a) criteria and
why they, in its view, revealed several aggravating factors not
13 Medoff alleges that he served a total of twelve months
for these probation violations, and the court appears to have
proceeded on the same assumption. The PSR indicates, however,
that Medoff served just over seventeen months.
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accounted for in the GSR and necessitating an upward variance.
These factors included that Medoff had been flouting court orders
"going back to the 1990s [that] restrict[ed] [his] participation
in the securities industry"; that Medoff was convicted on two
counts of security fraud in 1995, then served significant time for
probation violations related to these convictions, but that his
time in prison did not deter him from violating the 2016 consent
judgment; that Medoff had received approximately $1,675,000 for
conduct violative of the 2016 consent judgment, but that these
monies obtained from criminal conduct were not accounted for in
calculating his GSR; that Medoff began violating the 2016 consent
judgment almost immediately after it was entered; that Medoff's
criminal contempt of the 2016 consent judgment involved seven years
of criminal conduct; that Medoff used a false identity to conceal
this criminal conduct; that Medoff repeatedly violated the
conditions of his pretrial release in the criminal case by using
drugs and then lying to the court and probation office about having
done so; that Medoff and others like him need to be deterred from
violating court orders; and that Medoff was a danger to the public,
given his persistent involvement in securities work
notwithstanding multiple court orders barring him from doing so.
"Where, as here, the [sentencing] court imposes an
upwardly variant sentence, it must explain its reasons for doing
so." Waithe, 150 F.4th at 25 (quoting United States v.
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Flores-Nater, 62 F.4th 652, 655(1st Cir. 2023)). Moreover, "[t]he court's burden of explanation 'increases in proportion to the extent of [its] deviation from the [GSR].'"Id.
(quoting United States v. Montero-Montero,817 F.3d 35, 37
(1st Cir. 2016)). But there is no single correct sentence in any case; rather, there is "a universe of reasonable sentencing outcomes." United States v. Clogston,662 F.3d 588, 592
(1st Cir. 2011). And a sentence falls within that universe if the sentencing court provides a "plausible sentencing rationale and a defensible result." Flores-Nater,62 F.4th at 655
(quoting United States v. Díaz-Lugo,963 F.3d 145, 157
(1st Cir. 2020)).
Here, the district court's thorough explanation of the
aggravating factors that led it to impose an upwardly variant
twenty-month sentence was quite plausible and more than sufficed
to establish the sentence's defensibility. We therefore reject
Medoff's argument that his sentence was substantively
unreasonable. In so ruling, we reiterate that, although the
government recommended a sentence of ten months, it ultimately
agreed with the court that there were aggravating factors not
accounted for by the GSR and expressed no opposition to the
upwardly variant sentence that the court imposed.
III.
For the reasons stated, we affirm defendant-appellant
Craig Medoff's sentence.
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Reference
- Status
- Published