United States v. Sean Jelen

• Court: Court of Appeals for the Third Circuit
• Decided: February 20, 2024
• Docket: 18-1284
• Status: Unpublished

Opinion

NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT ____________

No. 18-1284 ____________

UNITED STATES OF AMERICA

v.

SEAN E. JELEN, Appellant ____________

On Appeal from the United States District Court for the Middle District of Pennsylvania (D.C. No. 3:16-cr-00156-001) District Judge: Honorable Malachy E. Mannion ____________

Submitted under Third Circuit L.A.R. 34.1(a) February 6, 2024

Before: HARDIMAN, SCIRICA, and SMITH, Circuit Judges,

(Filed: February 20, 2024)

___________

OPINION ∗ ____________

∗ This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not constitute binding precedent. HARDIMAN, Circuit Judge.

Sean Jelen appeals the District Court’s judgment of sentence as to its restitution

and forfeiture orders. Because Jelen’s plea agreement contained a waiver of appellate

rights and we perceive no miscarriage of justice in enforcing his bargain, we will affirm.

I1

While CEO of Valor Federal Credit Union and after his termination, Jelen engaged

in a variety of fraudulent activities. He abused his position to circumvent the credit

union’s financial controls, obtain insurance payments and proceeds, and forge documents

he then used to: (1) obtain and later increase a line of credit so he could purchase a

vacation home; (2) divert a company donation intended for a local soup kitchen to pay for

personal sponsorship of his alma mater’s golf tournament; and (3) pay for his personal

debts, personal furniture, and his wife’s birthday party. Jelen pleaded guilty to a two-

count Information charging him with bank fraud and attempted bank fraud in violation of

18 U.S.C. §§ 1344 and 1349. The Information also contained forfeiture allegations for the

vacation home.

Jelen’s plea agreement addresses loss, restitution, and forfeiture. The agreement

provides: (1) Jelen and the Government agree “the amount of loss resulting from the []

bank fraud activities [was] more than $200,000 but less than $500,000,” App. 33;

1 The District Court had jurisdiction under 18 U.S.C. § 3231. We have jurisdiction under 28 U.S.C. § 1291. We exercise plenary review in determining whether Jelen raises issues on appeal that fall within the scope of the plea agreement’s appellate waiver and whether the waiver should be enforced. United States v. Icker, 13 F.4th 321, 326 (3d Cir. 2021).

2 (2) Jelen must “make full restitution as may be determined by the Court,” id.; and (3) the

amount of mandatory restitution ordered might differ from the loss amount used to

calculate his Guidelines range. Jelen also stipulated to: (1) forfeiture of the vacation home

unless both parties subsequently agreed to a substitute amount of money in lieu of this

forfeiture; and (2) “[w]aiver of the right to appear and contest any portion of the

forfeiture proceedings,” App. 25.

As Jelen concedes, the plea agreement also contained a waiver of appellate rights

precluding a challenge to his conviction and sentence on “any and all possible grounds,”

and Jelen was so advised during his guilty plea colloquy. App. 40–41. The appellate

waiver did not include any exceptions for challenges to the Court’s restitution or

forfeiture orders. App. 23, 30–33; see United States v. Perez, 514 F.3d 296, 299 (3d Cir.

2007) (a waiver of right to appeal sentence bars appeal of the restitution order); United

States v. Damon, 933 F.3d 269, 273 (3d Cir. 2019) (waiver of sentencing appeals “can

only reasonably be read to include all forms of punishment or penalties imposed on a

defendant” and forfeiture is within the common understanding of the term “sentence”).

As part of its sentence, the District Court ordered that Jelen pay $694,971.88 in

restitution—$102,625.18 to the credit union and $592,346.70 to the credit union’s

insurer—as well as forfeit his vacation home.

II

Jelen makes three related arguments challenging the restitution and the forfeiture

orders: (1) the District Court exceeded its authority by imposing improper restitution in

the form of consequential damages; (2) forfeiture of his vacation home violates the

3 Eighth Amendment’s ban on excessive fines because it was duplicative of restitution and

the forfeiture order did not comply with Rule 32.2 of the Federal Rules of Criminal

Procedure; and (3) enforcement of the appellate waiver in his plea agreement would

result in a miscarriage of justice. Jelen Br. 10–11. The Government responds that Jelen’s

sentence should be affirmed because Jelen’s appeal falls within his enforceable waiver of

appeal rights and Jelen cannot show any manifest injustice. Gov’t Br. 24. We agree with

the Government.

Jelen invokes the “miscarriage of justice” exception to enforcing appellate

waivers, 2 claiming it applies when “questions arise as to the fairness of a sentencing

proceeding.” Jelen Br. 13. This exception is applied “sparingly and without undue

generosity.” United States v. Wilson, 429 F.3d 455, 458 (3d Cir. 2005). And Jelen fails to

identify any instance of unfairness in the proceedings before the District Court,

particularly in light of the specifics of this plea agreement, and because his challenges

amount to claims of ordinary error.

Citing United States v. Simmonds, 235 F.3d 826 (3d Cir. 2000), Jelen argues that

the District Court exceeded its authority by including in its restitution judgment an

amount of attorney fees and investigation costs, which he claims were improper collateral

damages and unsupported by any factual findings. Jelen Br. 15–16. He cites to

$46,244.18 out of the $694,971.88 ordered as restitution. We disagree.

2 We may enforce the plea agreement’s appellate waiver because Jelen entered into the agreement and entered his guilty plea knowingly and voluntarily. United States v. Khattack, 273 F.3d 557, 562 (3d Cir. 2001).

4 It is not manifestly unjust to enforce Jelen’s appellate waiver to preclude him from

challenging the amount entered by the District Court for several reasons. First, the

Amended Presentence Report (PSR) detailed losses to both the credit union and its

insurer caused by the fraud and classified the $46,244.18 as “audit expenses.” PSR (Third

Add.) at 1–2; see, e.g., Lagos v. United States, 584 U.S. 577, 579 (2018) (“expenses

incurred during participation in the investigation and prosecution of the offense” are

properly part of restitution) (quoting 18 U.S.C. § 3663A(b)(4)) (emphasis omitted).

Second, although the record does not disclose whether the expenses were incurred by the

employer at the Government’s behest, Jelen made no objection at sentencing to the

amount ordered. Third, the dispute over the amount assessed is qualitatively different

than what we have upended in other cases. See, e.g., United States v. Yung, 37 F.4th 70,

82–83 (3d Cir. 2022) (not enforcing appellate waiver when restitution ordered was to a

party neither a victim nor suffering damages). And finally, this raises a factual dispute.

See, e.g., United States v. Icker, 13 F.4th 321, 326 n.3 (3d Cir. 2021) (not enforcing

waiver because the error was grave, imposed on defendant a burdensome obligation, and

involved no issue of fact).

Jelen also challenges the forfeiture order that relinquishes his vacation home—

which he obtained through use of his ill-gotten lines of credit. He contends that the

forfeiture violated the Eighth Amendment’s Excessive Fines Clause and was entered at

the wrong time.

Relying on United States v. Bajakajian, 524 U.S. 321 (1998), Jelen claims that the

forfeiture of his vacation home is disproportionate to his offense when considered with

5 the restitution order imposed. Jelen Br. 19–20. We are not persuaded. First, Jelen agreed

to forfeit this property to the Government. And he acknowledged the District Court’s

discretion to determine the amount of restitution to be paid to his victims—restitution

which was mandatory and supported by the detailed findings adopted by the District

Court without objection. Moreover, restitution is different from forfeiture. See 18 U.S.C.

§§ 3663A, 3664(f)(1)(A); United States v. Various Computs. & Comput. Equip., 82 F.3d

582 (3d Cir. 1996) (restitution mandatory as is forfeiture). Finally, Bajakajian dealt with

the forfeiture of U.S. currency as “proceeds of legal activity,” 524 U.S. at 338, whereas

here the forfeited property was obtained via Jelen’s admittedly ill-gotten lines of credit.

Moreover, the plea agreement stipulated to this forfeiture, and the forfeiture was subject

to the express “waiver” in the agreement “of [his] right to appear and contest any portion

of the forfeiture proceedings,” App. 24–25. So Jelen cannot show any manifest injustice

resulting from the enforcement of the waiver of his right to appeal the forfeiture order.

Jelen’s attempt to further challenge the agreed-to order of forfeiture based on when the

District Court entered it similarly falls flat.

‫ﮫ‬ ‫كﮫك‬ ‫ﮫ‬

For these reasons, we conclude that Jelen’s appeal falls within the appellate waiver

of his plea agreement, and he fails to show any “miscarriage of justice” in its

enforcement. We will affirm the District Court’s judgment, including its restitution and

forfeiture orders.