United States v. Steven Miller

MEMORANDUM

Between August 2004 and November 2006, the defendant Steven Miller engaged in a complex scheme to defraud Cisco Systems, Inc. Miller pled guilty to one count of mail fraud and one count of money laundering without a plea agreement, and did not plead guilty to ten other counts.

We review a district court’s methodology for calculating loss under the Sentencing Guidelines de novo. United States v. Hardy, 289 F.3d 608, 613 (9th Cir.2002). We look to the fair market value of the property and in particular the value “at which th[e] victim offered the goods for sale.” Id. (internal quotation omitted). This valuation method requires us to look at the market that the victim participated in. Cisco does not participate and compete in the gray market. It does not sell replacement parts and it does not do direct sales through the internet. Cisco’s market is solely authorized distributors and large direct buyers, and Cisco’s product is inclusive of the warranty and service. Cisco provides replacement parts as part of its warranty instead of selling them. The district court’s loss calculation was therefore proper.

We review for clear error a district court’s refusal (after the…