§175 Acquitted, Dismissed, Uncharged Conduct
(for use in Departures see §718)
Supreme Court vacates Eleventh Circuit case and remands for reconsideration in light of Apprendi. (175) The Eleventh Circuit’s opinion in U.S. v. Garcia, 208 F.3d 1258 (11th Cir. 2000), held that the use of relevant conduct did not violate the extradition statute, that the obstruction enhancement was properly applied for destruction of evidence, and that defendant did not accept responsibility despite his guilty plea. On January 8, 2001, the Supreme Court granted certiorari, vacated the judgment and remanded the case for reconsideration in light of Apprendi v. New Jersey, 530 U.S. 466 (2000). Garcia v. U.S., 121 S.Ct. 750 (2001).
Supreme Court says acquitted conduct may be relied on in sentencing. (175) Reversing the Ninth Circuit’s decisions in U.S. v. Watts, 67 F.3d 790 (9th Cir. 1995), and U.S. v. Putra, 78 F.3d 1386 (9th Cir. 1996), and overruling the Ninth Circuit’s decision in U.S. v. Brady, 928 F.2d 844, 851 (9th Cir. 1991), the Supreme Court held that sentencing courts may consider conduct underlying charges for which the defendant has been acquitted. In a per curiam opinion, the court noted that 18 U.S.C. § 3661 codifies the long-standing principle that sentencing courts have broad discretion to consider various kinds of information. The court noted that contrary to the Ninth Circuit’s assertion in Brady, the jury cannot be said to have “necessarily rejected” any facts when it returns a general verdict of not guilty. Justice Stevens dissented on the merits, and Justice Kennedy dissented from the court’s decision to summarily reverse the Ninth Circuit without full briefing and argument. U.S. v. Watts, 519 U.S. 148, 117 S.Ct. 633 (1997).
7th Circuit allows acquitted conduct to be used at sentencing. (175) Defendant was convicted of money laundering, among other offenses, but he was acquitted of conspiracy. At sentencing, the district court found that the government had proven the acquitted conduct underlying the conspiracy by a preponderance of the evidence and relied on it to increase defendant’s offense level. The Seventh Circuit noted that the Supreme Court has approved the use of acquitted conduct at sentencing as long as the district court finds the acquitted conduct by a preponderance of the evidence. U.S. v. Gan, __ F.4th __ (7th Cir. Nov. 23, 2022) No. 21-1990.
1st Circuit upholds abduction enhancement even though defendant did not participate. (175)(224) Defendant pleaded guilty to carjacking. At sentencing, the district court added four levels under § 2B3.1(b)(4)(A) for abduction during the offense. The First Circuit upheld this enhancement, even though defendant only drove her boyfriend to the beach where the abduction occurred. Under § 1B1.3, the abduction was “relevant conduct” because it was within the scope of reasonably foreseeable activity. U.S. v. Rijos-Rivera, __ F.4th __ (1st Cir. Nov. 21, 2022) No. 21-1721.
7th Circuit upholds use of acquitted conduct at sentencing. (175) At defendant’s sentencing for Hobbs Act robbery, the district court found by a preponderance of the evidence that defendant had committed a murder for which the jury had acquitted him. The Seventh Circuit held that it was well-settled that acquitted conduct can be used at sentencing and found the murder here was properly considered as relevant conduct. U.S. v. McClinton, __ F.4th __ (7th Cir. Jan. 12, 2022) No. 20-2860.
11th Circuit finds firearms and drugs seized after charged conspiracy ended were “relevant conduct.” (175)(275) Defendant was convicted of a conspiracy to distribute drugs that ran from January 1, 2010, to December 31, 2013. He was arrested on September 23, 2014. At sentencing, the court ruled that firearms and drugs found during his arrest were “relevant conduct” under §1B1.3 and therefore included them in calculating defendant’s offense level. On appeal, the Eleventh Circuit affirmed, finding that the firearms and drugs were relevant conduct because defendant admitted that he had been paid to keep the drugs and there was a common purpose between the drugs found at his arrest and the drugs charged. U.S. v. Perry, __ F.4th __ (11th Cir. Sept. 29, 2021) No. 16-11358.
1st Circuit says attempted murders were relevant conduct for RICO gang leader. (175)(290) At defendant’s sentencing for RICO, the district court attributed as relevant conduct two attempted murders committed by another gang member. Defendant objected that these attempted murders were not reasonably foreseeable to him, as required by § 1B1.3. The First Circuit found that defendant’s conversations with the attempted murderer about attracting younger members to the gang made it foreseeable that defendant, a gang leader, would know of the attempted murders. U.S. v. Sandoval, __ F.3d __ (1st Cir. July 7, 2021) No. 18-1995.
7th Circuit finds accomplice’s use of handgun was within scope of joint activity. (175)(224) In sentencing defendant for attempted Hobbs Act robbery of a gas station, the court added six levels under § 2B3.1(b)(2)(B) because his accomplice “otherwise used” a handgun during the robbery. Defendant argued that codefendant’s use of the firearm was outside the scope of his jointly undertaken criminal activity, and thus not “relevant conduct” under § 1B1.3(a)(1). The Seventh Circuit affirmed, finding that defendant participated in a string of armed robberies and sufficiently participated in the robbery of the gas station. No additional findings were required. U.S. v. Ford, __ F.3d __ (7th Cir. Feb. 22, 2021) No. 19-3486.
1st Circuit finds drugs and guns were relevant conduct to machine gun conviction. (175) Defendant pleaded guilty to possession of a machinegun. At sentencing, the district court found that defendant’s drug use and two other firearms were “relevant conduct” under § 1B1.3. The First Circuit rejected defendant’s contention that there was insufficient evidence to support the enhancements, noting that defendant admitted the drug use and tested positive for it after his arrest and did not object to the presentence report’s recitation that police officers found two other firearms in his residence. U.S. v. Ramírez-Romero, __ F.3d __ (1st Cir. Dec. 4, 2020) No. 18-1863.
7th Circuit allows upward variance based on count dismissed as part of plea agreement. (120)(175)(780) At defendant’s sentencing for enticing a minor to send a sexually explicit video, the district court varied upward from the guidelines range based on a second count dismissed by the government as part of the plea agreement. The Seventh Circuit found the variance did not violate defendant’s rights to due process or a jury trial. U.S. v. Bridgewater, __ F.3d __ (7th Cir. Feb. 19, 2020) No. 19-2522.
3d Circuit reverses where sentence was based on arrest record. (175)(500) Defendant was convicted of drug and firearms offenses. He had six adult convictions and 18 other arrests. At sentencing, the district court referred to defendant’s “long and serious” criminal record and stated that the court was aware of the crimes he was convicted of committing, “as well as the crimes he was arrested for.” The district court interrupted the prosecutor to recite all 18 of defendant’s prior arrests. The court sentenced defendant to 1,020 months. The Third Circuit found that the district court erred in relying on arrests that had not resulted in conviction. U.S. v. Mitchell, __ F.3d __ (3d Cir. Dec. 5, 2019) No. 17-1095.
5th Circuit agrees that prior health care schemes were relevant conduct. (175)(218) Defendant ran a health-care firm that submitted false claims to Medicare. She was convicted of various offenses involving health-care fraud, but the government did not include two other schemes that also involved submitting false claims to Medicare. At sentencing, the district court found that the other two schemes were relevant conduct and found a total loss of more than $3.5 million. Reviewing for clear error, the Fifth Circuit upheld the district court’s finding that defendant’s prior defrauding of Medicare was part of the same scheme or plan of which she was convicted. Although defendant’s prior schemes grew out of different health-care functions, defendant had submitted fraudulent bills to Medicare in all the schemes. U.S. v. Ainabe, __ F.3d __ (5th Cir. Sept. 13, 2019) No. 18-20689.
6th Circuit reverses where gun possessed four months earlier was not “relevant conduct.” (175)(330) Defendant was found with two firearms and was convicted of possessing firearms while a regular drug user, in violation of 18 U.S.C. § 922(g)(3). At sentencing, the district court added two levels under § 2K2.1(b)(1)(A) for possessing of three to seven firearms. For the third firearm, the district court relied on a gun that had been found in a room that defendant occupied four months earlier and found that it was relevant conduct to his offense. The Sixth Circuit reversed, holding that the firearm was not relevant conduct because the circumstances of its possession were not relevant to the offense of conviction. U.S. v. Bowens, __ F.3d __ (6th Cir. Sept. 12, 2019) No. 18-5646.
8th Circuit finds earlier use of guns was same course of conduct as conviction offense. (175)(330) At defendant’s sentencing for possession of a firearm while under felony indictment, the district court enhanced defendant’s offense level by four under § 2K2.1(b)(6) for using or possessing a firearm “in connection with another felony offense.” Defendant had used the firearm in connection with domestic violence felonies that occurred two or three months before the date of his illegal possession of the firearm. The Eighth Circuit found that the prior offenses were part of the same course of conduct and therefore were part of the relevant conduct of his possession of the firearm. U.S. v. Paul, __ F.3d __ (8th Cir. Aug. 7, 2019) No. 18-1871.
6th Circuit allows consideration of uncharged tax losses. (120)(175)(370) Defendant was convicted of tax offenses. At sentencing, the district court used uncharged tax losses to calculate the tax loss and restitution. Defendant argued that the Supreme Court’s decision in Nelson v. Colorado, 137 S.Ct. 1249 (2017), rendered the use of uncharged conduct unconstitutional. The Sixth Circuit found that Nelson did not apply because it simply held that when a defendant’s conviction has been overturned, he “should not be saddled with any proof burden” in his efforts to reclaim fines or restitution associated with the overturned conviction. U.S. v. Rankin, __ F.3d __ (6th Cir. July 12, 2019) No. 18-3345.
6th Circuit allows use of acquitted conduct to set offense level for abusive sexual contact. (175)(215) Defendant was convicted of abusive sexual contact, which has a base offense level of 20 under 2A3.4(c)(1), but was acquitted of aggravated sexual abuse, which has base offense level of 30 under §2A3.1. Nevertheless, section 2A3.4(c)(1) says that if the offense involves “criminal sexual abuse,” the court should apply § 2A3.1. The district court found by a preponderance of the evidence that defendant had committed abusive sexual contact and therefore set defendant’s offense level under § 2A3.1. On appeal, defendant argued that the district court erred in relying on acquitted conduct to set his offense level. The Sixth Circuit rejected the argument, ruling that it was proper for the district court to rely on acquitted conduct at sentencing. U.S. v. Wandahsega, __ F.3d __ (6th Cir May 21, 2019) No. 18-1187.
5th Circuit reverses where uncharged child porn victims were not relevant conduct. (175)(310) Defendant pretended to be a young girl on line to induce young girls to send him sexually explicit pictures of themselves. He pleaded guilty to producing child pornography with regard to only one victim. However, at sentencing, the district court created five “pseudo counts” to account for defendant’s conduct in inducing other young girls to send him sexually explicit pictures. On appeal, the Fifth Circuit reversed, finding no evidence that defendant used the image of the victim in the charged count to obtain images from the “pseudo count” victims, or that he used the images of the “pseudo count” victims to obtain images from his charged victim. For this reason, the court held, the uncharged conduct was not relevant conduct to the offense of conviction. U.S. v. Randall, __ F.3d __ (5th Cir. May 22, 2019) No. 17-11403.
7th Circuit allows consideration of uncharged attempted murder that had previously been discounted. (175)(290) At defendant’s sentencing for racketeering offenses, the district court considered an attempted but uncharged murder as relevant conduct. At a prior sentencing of another defendant arising from the same offenses, the district court found that the government had not proved that this attempted murder occurred in the course of the RICO conspiracy. The Seventh Circuit affirmed, finding that the district court’s obligation to avoid conflicting findings does not require it to adhere to a previous mistake. The court of appeals also rejected defendant’s argument that his sentence was improperly higher than that of the codefendant, finding that the district court had properly calculated defendant’s guidelines range and provided sufficient reasons—including its error in previously refusing to consider the uncharged attempted murder —to justify any disparity. U.S. v. King, __ F.3d __ (7th Cir. Dec. 6, 2018) No. 16-1275.
7th Circuit finds that uncharged attempted murder furthered conspiracy. (175)(290) The district court at defendant’s sentencing for racketeering offenses considered an uncharged attempted murder in imposing sentence on defendant. The Seventh Circuit affirmed, finding that the evidence at defendant’s trial showed that the murder was committed in furtherance of the conspiracy. The court noted that a member of the conspiracy gave defendant a gun and asked him to kill the victim, that defendant was a member of the same gang as the person who gave him the gun, and that the victim had been the subject of prior gang-related efforts to kill him. U.S. v. King, __ F.3d __ (7th Cir. Dec. 6, 2108) No. 16-1275.
3d Circuit counts uncharged social security losses to be included as “relevant conduct.” (175)(219) Defendant pleaded guilty to social security fraud. The district court increased her base offense level by four levels, because she obtained more than $7,000 in tax benefits and more than $13,000 in nutritional and medical assistance. On appeal, defendant argued that because she pleaded guilty only to applying for a false social security card, the loss amount should not include any benefits she obtained. The Third Circuit rejected this argument, finding that defendant applied for the card only to use it and that the relevant conduct guideline, §1B1.3, permits the court to include uncharged losses in sentencing. U.S. v. McClure-Potts, __ F.3d __ (3d Cir. Nov. 8, 2018) No. 17-2987.
2nd Circuit finds relevant conduct was attempted murder, despite jury’s acquittal. (175)(210) Defendant was convicted of weapons charges based on his involvement in several shootings that were part of his attempt to gain entrance to, or maintain or increase his position in, the gang La Mara Salvatrucha (MS-13). The jury acquitted him of the attempted murder of Williams, one of the shooting victims. However, the district court found that defendant’s shooting of Williams was attempted murder, making his base offense level 33. Defendant acknowledged that courts may use acquitted conduct as relevant conduct, but argued that the jury might have acquitted him on the attempted murder charge because it found his duress defense to be meritorious, thereby negating any conclusion of guilt. The Second Circuit upheld the relevant conduct finding. For the counts charging attempted murder or assault, the jury was asked simply whether its verdict was guilty or not guilty. No questions were put to the jury that could reveal the basis for its decision on any count. The panel declined defendant’s “invitation to rule that the court’s normal authority to make findings relevant to sentencing vanished because of a speculative ‘possibility.'” U.S. v. Hernandez, __ F.3d __ (2d Cir. July 9, 2018) No. 16-2765.
8th Circuit allows dismissed conduct to be considered at sentencing. (175)(715) A jury convicted defendants of assault with a dangerous weapon and assault resulting in serious bodily injury. On the government’s motion, a separate indictment, based on similar conduct with different victims, was dismissed. Guideline §5K2.21 provides that the court may depart upward in certain circumstances based on conduct “underlying a charge dismissed as part of a plea agreement … or for any other reason.” Defendants argued that the “any other reason” language did not allow the court to depart upward based on dismissed conduct because the charges were not dismissed as part of a plea agreement. The Eighth Circuit held that this argument was foreclosed by the “longstanding principle that sentencing courts have broad discretion to consider various kinds of information.” Consideration of such conduct did not violate the Sixth Amendment. Because the district court treated the guidelines as advisory and sentenced defendants below the statutory maximum, the Sixth Amendment was not implicated. U.S. v. Running Shield, __ F.3d __ (8th Cir. Aug. 8, 2016) No. 15-2369.
6th Circuit allows acquitted assault to be considered relevant conduct in RICO conspiracy. (175)(290) Defendant was convicted of racketeering and conspiracy to distribute drugs. The district court found by a preponderance that defendant assaulted Patton with intent to commit murder. Defendant argued that this was improper because the jury acquitted him of assaulting Patton and the government offered no additional proof at sentencing. The Sixth Circuit disagreed, noting that the district court could properly fined that the assault was relevant conduct under section 1B1.3. The district court’s finding, while terse, was not clearly erroneous. The testimony revealed a brutal assault with a knife and supported a finding that defendant was the one who stabbed Patton. Specific intent to kill could be inferred from defendant’s decision to stab Patton in the chest in the midst of the fight. At a minimum, it was not clearly erroneous to find that defendant aced with such intent. U.S. v. Rios, __ F.3d __ (6th Cir. July 21, 2016) No. 14-2495.
6th Circuit says secret videos of naked stepdaughter were relevant conduct to child porn offense. (175) (310) Defendant pled guilty to receiving child pornography. Because defendant was also secretly recording videos of his 15-year-old stepdaughter naked, the district court rejected a two-level reduction under § 2G2.2(b)(1) for conduct “limited to the receipt or solicitation of material involving the sexual exploitation of a minor.” The Sixth Circuit upheld the denial of the reduction, holding that defendant’s “video voyeurism” was relevant conduct under both § 1B1.3(a)(1)(A) and § 1B1.3(a)(2). First, defendant produced the videos “during the commission of the offense of conviction.” The behavior was therefore relevant conduct under subsection (a)(1)(A). Second, the offense of conviction was one “for which § 3D1.2(d) would require grouping of multiple counts.” The videos also were part of the same course of conduct as the child porn, happening as part of an “ongoing series of offenses” that happened over a close time interval, multiple times, and involved a high degree of similarity. U.S. v. Hodge, __ F.3d __ (6th Cir. Oct. 20, 2015) No. 14-5256.
2nd Circuit approves use of acquitted and uncharged murders at sentencing. (175) Defendant was convicted of racketeering conspiracy. The district court found that he was involved in the murders Greaves, Dols, and Cutolo, of which he was acquitted, and the murder of Scopo, for which he had never been charged. Defendant argued on appeal that the district court violated his constitutional rights at sentencing by taking into account uncharged and acquitted crimes, and erred by doing so without holding a hearing pursuant to U.S. v. Fatico, 603 F.2d 1053 (2d Cir. 1979). The Second Circuit held that district court was entitled to rely upon the trial evidence in finding the facts on which it sentenced defendant. No Fatico hearing was required because defendant already had an opportunity to rebut the government’s allegations in a trial presided over by the sentencing judge. Witnesses testified regarding defendant’s personal involvement in the murders of Greaves, Dols, and Cutolo. The district court found that Scopo’s murder was the result of the conspiracy, and this finding was supported by trial testimony that defendant and his co-conspirators “took steps to look for” Scopo, and that one of the co-conspirators was later charged with Scopo’s murder. U.S. v. Cacace, __ F.3d __ (2d Cir. Aug. 5, 2015) No. 14-903-cr.
11th Circuit considers loss from uncharged conduct. (175)(219) Defendant was convicted of mortgage fraud conspiracy and one substantive count, and was acquitted of all other substantive counts. There were 29 properties involved in the fraudulent conduct, and the court held defendant accountable for losses from ten properties. The Eleventh Circuit upheld the inclusion of losses from two properties for which defendant was not charged. Defendant’s brother, Bobka, participated in fraudulent transacttions for both these properties, and defendant partnered with his brother in their real estate investments. Defendant actively managed these two properties through his partnership with his brother, and they shared a bank account with defendant’s wife through which they jointly funneled money for the transactions. Moreover, defendant and his wife reported ownership of both properties and the expenses incurred in renting out each property on their 2006 and 2007 joint tax returns. The court did not err in finding that the losses from these properties were within the scope of the criminal activity that defendant agreed to undertake. U.S. v. Cavallo, __ F.3d __ (11th Cir. June 22, 2015) No. 12-15660.
11th Circuit says using acquitted conduct to calculate loss did not require clear and convincing evidence. (175)(219)(755) Defendant was involved in a long-running mortgage fraud scheme. He was convicted of conspiracy and one substantive count, and was acquitted of all other substantive counts. There were 29 properties involved in the fraudulent conduct, and the court held defendant accountable for losses attributable to ten of these properties, despite his acquittal on the substantive counts for these properties. On appeal, the Eleventh Circuit found no error. Under long-standing precedent, relevant conduct of which a defendant was acquitted may be considered in sentencing for the offense of conviction, as long as the government proves the acquitted conduct by a preponderance of the evidence. The panel rejected defendant’s argument, raised for the first time on appeal, that the court should have used a clear and convincing evidence standard. U.S. v. Cavallo, __ F.3d __ (11th Cir. June 22, 2015) No. 12-15660.
11th Circuit affirms relevant conduct findings based on “clearly identifiable evidence.” (175) (230) Defendant, a former governor of Alabama, was convicted of bribery and related charges. The district court used defendant’s bribery conviction as the offense of conviction, but considered conduct beyond the bribery in calculating defendant’s sentence, i.e., a series of sham transactions carried out after the investigation into defendant had commenced. Defendant challenged for the first time on appeal the district court’s failure to explicitly explain why these transactions qualified as relevant conduct. The Eleventh Circuit found no error. A district court’s failure to make explicit relevant conduct findings does not preclude appellate review, and does not warrant reversal, “where the court’s decisions are based on clearly identifiable evidence.” Here, in rejecting defendant’s objection to the PSR’s value-of-the-bribe calculation, the district court expressly listed the money involved in the sham transactions, making it clear that the district court treated the sham transactions as relevant conduct to the bribery offense. U.S. v. Siegelman, __ F.3d __ (11th Cir. May 20, 2015) No. 12-14373.
11th Circuit treats as relevant conduct, transactions with a common accomplice, victim, purpose, and method. (175)(230) Defendant, a former governor of Alabama, was convicted of bribery and related charges. In calculating defendant’s sentence, the district court considered as relevant conduct a series of sham transactions carried out after the investigation into defendant had commenced. The Eleventh Circuit found no error. The sham transactions were substantially connected to the bribery by a common accomplice, Bailey, defendant’s close associate. The sham transactions were also substantially connected to the bribery by a common victim, common purpose, and similar modus operandi. Both offenses deprived the citizens of Alabama of the honest services of their Governor and therefore harmed a common victim. Moreover, both offenses were committed for the common purpose of obtaining power and money for defendant and his associates. U.S. v. Siegelman, __ F.3d __ (11th Cir. May 20, 2015) No. 12-14373.
1st Circuit relies on relevant conduct to enhance sen¬tence for pattern of sexual conduct. (175) Defendant pleaded guilty to travel with intent to engage in sexual activity with a minor. Based on defendant’s previous alleged sexual contact with a different minor, which was then the subject of a pending Maine state charge, the district court applied an enhancement under § 4B1.5(b)(1) for having engaged in “a pattern of activity involving prohibited sexual conduct.” Defendant argued that by authorizing courts to consider relevant conduct, the guidelines violated the Sentencing Reform Act’s man¬date for guidelines responsive to the nature of “the of¬fense,” 28 U.S.C. § 994(c). The First Circuit found no plain error. The Supreme Court has held that the guide¬lines’ grant of discretion to sentencing judges to consider a defendant’s other relevant conduct is consistent with both the Sentencing Reform Act and principles of due process under U.S. v. Watts, 519 U.S. 148, 153–156 (1997), provided that the underlying facts are found by a preponderance of the evidence. U.S. v. Gaffney-Kassel, __ F.3d __ (1st Cir. Nov. 18, 2014) No. 13-2023.
1st Circuit upholds use of acquitted conduct to support enhancement. (175) After leading police on a high-speed chase through a residential neighborhood, defendant and another occupant of the car fled, exchanging gunshots with two of their pursuers. The district court applied a three-level enhancement under § 3A1.2(b) for assaulting a law enforcement officer and creating a substantial risk of bodily injury. Defendant claimed that the district court impermissibly used acquitted conduct to boost his offense level. The First Circuit found no error. “[A] sentencing court may consider conduct of which a defendant has been acquitted” in determining the length of a sentence. U.S. v. Watts, 519 U.S. 148 (1997). This circuit has consistently applied this principle, and was duty bound to apply it here. U.S. v. Alicea, 205 F.3d 480 (1st Cir. 2000).
1st Circuit upholds reliance on acquitted counts to apply § 2K2.1(b)(5) enhancement. (175) Defendant was arrested based on his suspected involvement in an attempted robbery of an armored vehicle. A Rhode Island federal jury acquitted him of charges relating to the attempted robbery. A Massachusetts federal jury then convicted him of felon in possession charges. At sentencing, the district court applied a § 2K2.1(b)(5) enhancement based on defendant’s possession of the gun in connection with the attempted robbery for which the Rhode Island jury had acquitted him. The First Circuit held that the consideration of the conduct underlying the acquitted robbery counts was permitted by the Supreme Court’s recent decision in U.S. v. Watts, 117 S.Ct. 633 (1997). Dicta to the contrary in U.S. v. Lanoue, 71 F.3d 966 (1st Cir. 1995) has been abrogated by Watts. U.S. v. Meade, 110 F.3d 190 (1st Cir. 1997).
1st Circuit finds second fraudulent loan used to pay off first fraudulent loan was relevant conduct. (175) Defendant was convicted of bank fraud after he inflated the purchase price of a warehouse in order to receive a loan for the full purchase price of the warehouse. He also submitted to the bank falsified rental agreements for tenants at the warehouse. In order to pay off this first loan, he used proceeds from a second loan that he obtained with four other men. In obtaining this loan, defendant forged the signatures of the men’s wives on a guarantee form. The First Circuit upheld the court’s consideration of the forgery and the fraudulent nature of the second as relevant conduct for the first loan. The use of the forgery to obtain the second loan was part of the same scheme or plan as defendant’s fraudulent efforts to obtain the first loan. Defendant used the proceeds from the second loan to pay off the first loan. U.S. v. D’Andrea, 107 F.3d 949 (1st Cir. 1997).
1st Circuit sentences conspiracy defendant for underlying crime despite acquittal. (175) Defendant was convicted of conspiring to rob a bank and being a felon in possession of a firearm. He argued that the district court should not have used the robbery guideline to calculate his offense level because he had been acquitted of robbery. The First Circuit held that the acquittal did not bar defendant from being sentenced for the underlying offense. Conspiracies are treated like substantive offenses for sentencing purposes. Also, a jury’s verdict of acquittal does not prevent a sentencing court from considering conduct underlying the acquitted charge, so long as the conduct has been proved by a preponderance of the evidence. U.S. v. Rose, 104 F.3d 1408 (1st Cir. 1997).
1st Circuit rejects higher burden of proof for acquitted conduct. (175) Defendant and his half‑brother were tried and acquitted in state court of murdering two acquaintances. They were then convicted in federal court for different crimes relating to the same episode. Section 2K2.1(c)(2) provides that where a firearm is used in connection with another offense, the base level should be that of the “object” offense. The district court found by a preponderance that defendant had participated in the premeditated murders, and applied § 2A1.1. This raised defendant’s sentence from a range of 20‑30 years to a life sentence. Defendant argued that due process required a “beyond a reasonable doubt” standard where the uncharged or acquitted crime has so severe an effect on the sentence. The First Circuit rejected the argument, noting that U.S. v. Lombard, 72 F.3d 170 (1st Cir. 1995) authorizes a district court to depart downward from the life sentence, which essentially restores pre‑guideline discretion to decide whether and how far to give weight to the murders. Although as a matter of policy the use of acquitted conduct might be troubling, the Constitution does not require a higher standard of proof. U.S. v. Lombard, 102 F.3d 1 (1st Cir. 1996).
1st Circuit permits departure where acquitted conduct resulted in mandatory life sentence. (175) Defendants were acquitted in state court of murdering two men. They were then indicted in federal court on firearms charges arising out of the murders. The district court found that defendants used the firearms in connection with the murders, and applied the cross references in § 2K2.1(c)(2) and § 2X1.1 to first degree murder. As a result, one defendant received a mandatory term of life imprisonment. The First Circuit found that this was a case where the sentencing enhancement was “the tail which wags the dog” of the offense of conviction. The murders were not used just to fix the defendant’s sentence at some higher point within the statutory range for the firearms offense. Instead, the absence of a statutory maximum required the court to sentence as if the offense of conviction was first degree murder. This came too close to punishing defendant for the murders rather than the firearms offense. Given these constitutional concerns, the district court had authority under § 5K2.0 to depart downward from the life sentence. This was an “unusual and perhaps singular case” and should not be construed as an invitation to litigate the usual sentence enhancement based on uncharged or acquitted conduct. U.S. v. Lombard, 72 F.3d 170 (1st Cir. 1995).
1st Circuit finds uncharged guns were relevant conduct to felon in possession charge. (175) Defendant was convicted of being a felon in possession of a firearm in connection with a shootout that occurred on a street corner. The district court found that defendant possessed two additional guns found after the shooting in an apartment he shared with his girlfriend. It enhanced his offense level under § 2K2.1(b)(1) for possessing the additional guns, and under § 2K2.1(b)(4) because one of the guns had an obliterated serial number. Defendant argued that his possession of these guns was not part of the same course of conduct as required by § 1B1.3(a)(2). The Second Circuit disagreed, holding that the contemporaneous, or nearly contemporaneous, possession of uncharged firearms is relevant conduct in the context of a felon in possession prosecution. Defendant clearly possessed the guns in the apartment at the same time that he possessed the gun used in the shootout. U.S. v. Powell, 50 F.3d 94 (1st Cir. 1995).
1st Circuit says uncharged but relevant loans must be included in loss calculation. (175) Defendant was charged with obtaining $900,000 in fraudulent loans. The government claimed that an additional $1,016,000 in loans should be considered as relevant conduct for loss calculation purposes under § 2F1.1. The 1st Circuit agreed. The district court found, as a matter of law, that it was inappropriate to consider the uncharged loans. This is clearly wrong. A sentencing court may not simply disregard relevant conduct. The district court also erred in reducing the loss by amounts defendant repaid as part of the settlement of a civil lawsuit. Although the settlement came 10 months before defendant was indicted, it occurred after his offense was discovered. Under note 7(b) to § 2F1.1, the “actual loss” to the victim banks is the sum of the illegal loans involved in the offense of conviction and the loans constituting relevant conduct, less the amount of these loans that defendant had repaid before the discovery of his offense, and less the amount the victim banks had recovered, or could expect to recover, from assets pledged to secure these loans. U.S. v. Bennett, 37 F.3d 687 (1st Cir. 1994).
1st Circuit holds that losses in one fraud scheme were relevant conduct to other scheme. (175) Defendant operated two not-for-profit corporations that contracted with the Commonwealth of Massachusetts to provide services for mentally handicapped persons. He was charged with defrauding the Commonwealth by failing to disclose certain information and making excessive reimbursement requests. Pursuant to a plea agreement, charges relating to one corporation were dismissed, and he pled guilty to charges relating to the other corporation. The 1st Circuit affirmed that the dismissed counts were relevant conduct and thus the losses could be considered at sentencing. The schemes shared a great deal in common: (a) the same victim, (b) the same method of operation, and (c) the same three principals. The schemes were sufficiently comparable in character, cast and plot to warrant similar treatment under section 1B1.3. U.S. v. Williams, 10 F.3d 910 (1st Cir. 1993).
1st Circuit says considering dismissed counts as relevant conduct did not violate plea agreement. (175) Defendant argued that it violated his plea agreement for the court to consider conduct underlying dismissed counts, thus sentencing him as if the counts had not been dismissed. The 1st Circuit found no error, since defendant was “plainly on notice” that the losses in the dismissed counts would be considered as relevant conduct. Moreover, the plea agreement afforded defendant significant benefit. In addition to dismissing certain charges, the government agreed to recommend a sentence at the bottom of the guideline range and “left the door open” for a substantial assistance departure, which defendant ultimately received. U.S. v. Williams, 10 F.3d 910 (1st Cir. 1993).
2nd Circuit allows acquitted robberies to be used as objects of robbery conspiracy. (175) Defendant was convicted of conspiracy to commit Hobbs Act robberies of drug dealers in New York, and acquitted of several substantive robbery counts. Notwithstanding the jury’s acquittal on the substantive charges, the district court found for sentencing purposes that the government had proven beyond a reasonable doubt that defendant had conspired to commit two of the robberies. The Second Circuit rejected defendant’s argument that the court’s consideration of the robberies as objects of the conspiracy violated his Sixth Amendment right to a jury trial because the jury had acquitted him “as to the same conduct.” The substantive commission of a robbery is not, in fact, the “same conduct” as conspiring to commit that very same robbery. U.S. v. Robles, 562 F.3d 451 (2d Cir. 2009).
2nd Circuit uses predicate racketeering conspiracy acts as relevant conduct without proof beyond a reasonable doubt. (175) Defendant, an alleged member of the Gambino Crime Family, was convicted after trial of a RICO conspiracy. Although the indictment charged four separate predicate acts, the jury found unproven all of the charged racketeering acts except for loan sharking. The district court nonetheless found, for relevant conduct purposes, that defendant was involved in an attempted murder and kidnapping. The Second Circuit held that the district court properly considered the acquitted conduct at sentencing. A sentencing court may consider predicate acts as relevant conduct because their commission need not be proven beyond a reasonable doubt. The district court was in the unique position to consider the credibility of the witnesses and to conclude that two of the government’s witnesses had been particularly credible in their testimony about defendant’s participation in the kidnapping. U.S. v. Yannotti, 541 F.3d 112 (2d Cir. 2008).
2nd Circuit holds defendant accountable for all funds he directly participated in smuggling, regardless of reasonable foreseeability. (175) Defendant attempted to smuggle $659,000 in U.S. currency to Egypt through a U.S. airport in the luggage of his parents. The district court held defendant responsible pursuant to U.S.S.G. § 1B1.3(a)(1)(A) for the total amount of funds. He challenged the district court’s decision to include the total amount of funds that he and his co-conspirators attempted to export, arguing that this total was not reasonably foreseeable to him. The Second Circuit found it irrelevant whether the total amount of funds was reasonably foreseeable to defendant since this was the amount that defendant personally and directly participated in smuggling. Defendant planned and organized the packaging of the currency, brought the suitcase containing the money into the airport and waited while his parents checked the luggage and then attempted to devise a cover story once the currency was discovered. U.S. v. Al-Sadawi, 432 F.3d 419 (2d Cir. 2005).
2nd Circuit holds that Booker does not bar sentencing on the basis of acquitted conduct. (175) Before Booker, the Supreme Court held that the Due Process Clause permitted a sentencing judge to use acquitted conduct in determining a defendant’s guideline range. U.S. v. Watts, 519 F.3d 148 (1997). The Second Circuit rejected defendants’ argument that the rulings in Booker and its predecessors precluded sentencing on the basis of acquitted conduct. First, Justice Stevens’ discussion in Booker indicated that Watts remains good law. Defendants’ argument missed the distinction between elements of an offense and facts relevant to sentencing. Although the jury acquitted defendants of conduct that would have exposed them to a statutory sentencing range of five to 40 years’ imprisonment under § 841(b)(1) (B), the jury convicted them of conduct that exposed them to a sentencing range of zero to 20 years’ imprisonment under § 841(b)(1)(C). The district court sentenced them within the range authorized by the jury verdict and within the guideline range as determined by facts found by a preponderance of the evidence. The panel also rejected defendant’s argument that a court cannot sentence a defendant to a term of imprisonment greater than the statutory minimum for drugs not found by a jury. The Supreme Court made clear in Booker than when a judge sentences a defendant within the statutory range authorized by the jury verdict, there is no Sixth Amendment violation. U.S. v. Vaughn, 430 F.3d 518 (2d Cir. 2005).
2nd Circuit includes uncharged embezzlement income as relevant conduct in tax loss. (175) The government stipulated to an offense level of 9 for defendant’s tax count in the plea agreement. The presentence report, however, found that defendant received an additional $776,280 in 1998 from his wife’s embezzlement scheme, which along with other uncharged conduct resulted in an offense level of 19. On appeal, the Second Circuit upheld the inclusion of this uncharged conduct as relevant conduct under § 1B1.3 in calculating defendant’s tax loss under § 2T1.1. The court noted that numerous cases have held that uncharged conduct may be considered as relevant conduct under the guidelines. U.S. v. Feola, 275 F.3d 216 (2d Cir. 2001).
2nd Circuit holds that tax evasion, fraud and conversion should be grouped together. (175) The district court ruled that defendant’s tax evasion counts should be grouped separately from his fraud and conversion counts. The Second Circuit disagreed. Grouping is appropriate under § 3D1.2(d) when the offenses are of the “same general type.” U.S. v. Napoli, 179 F.3d 1 (2d Cir. 1999). The offense level tables for tax evasion, fraud, and conversion all increase at the same rate and use the same monetary division points. The unity of these tables showed that the offenses were of “the same general type.” Under § 3D1.2(d), defendant’s fraud and conversion constituted relevant conduct so long as the fraud and conversion “were part of the same course of conduct or common scheme or plan as the offense of conviction.” They were, since a large portion of the income that defendant failed to report on his tax returns was derived directly from the fraud and conversion. Thus, the correct analysis did not include the multi-count approach under § 3D1.4, but instead aggregated the loss attributable to all of defendant’s offenses. U.S. v. Fitzgerald, 232 F.3d 315 (2d Cir. 2000).
2nd Circuit holds that prior burglaries were relevant conduct to burglary 19 months later. (175) In April 1995, defendants burglarized two hunting camps in Vermont, stealing firearms. Some 19 months later they looted a third hunting camp in Vermont, stealing a dozen more guns. They traded the guns stolen during the first two burglaries for money and marijuana. Defendants pled guilty to charges relating to the firearms stolen in the third burglary. The district court imposed a § 2K2.1(b)(5) enhancement because defendants possessed a firearm “in connection with” another felony, the swap of guns for drugs. Defendants argued that the trade of the guns for drugs was too attenuated from the third burglary to support the enhancement. The Second Circuit upheld the district court’s finding that the earlier burglaries were relevant conduct to the later burglary. Defendants were accomplices in all three burglaries, which shared a similar modus operandi and the common purpose of stealing guns to buy drugs. Despite the 19-month interval between the first two burglaries and the third burglary, they were sufficiently similar to qualify as an ongoing series of offenses. U.S. v. Shepardson, 196 F.3d 306 (2d Cir. 1999).
2nd Circuit says court may consider sales that were not above price set by conspiracy. (175) Defendants were convicted of conspiracy to fix prices in the market for ferrosilicon, and were acquitted of conspiring to fix the price of silicon metal. Section 2R1.1(b)(2) provides for offense level increases based on the “volume of commerce” attributable to the defendant. The district court refused to consider the volume of commerce affected by the silicon metal conspiracy, finding that although the price-fixing meetings occurred, the evidence “[fell] short of establishing a successful price-fixing agreement … that produced sales of silicon metal at or above an illegally-fixed floor price.” The Second Circuit found that the district court misunderstood its authority to take account of the acquitted conduct. Entry into an agreement to fix prices—even if the implementation of such an agreement is unsuccessful—is illegal conduct under the Sherman Act, 15 U.S.C. § 1. If the conspirators agreed to fix prices of silicon metal, and the conspiracy affected prices, the district court may consider this as relevant conduct for sentencing purposes, without regard to whether the sales were at or above the price fixed by the illegal agreement. U.S. v. SKW Metals & Alloys, Inc., 195 F.3d 83 (2d Cir. 1999).
2nd Circuit rules court intended to adopt PSR’s findings on relevant conduct. (175) The Second Circuit ruled that the relevant conduct findings were adequate because the district court intended to adopt the PSR’s findings. The PSR indicated that the total value of the stolen parts possessed by defendant, including the parts he never sold, was $89,640. At sentencing, the district court ruled that it was finding, “based upon relevant conduct in the guidelines, that there was a course of conduct and that it was part of a common scheme to bring it up to the amount that the presentence report indicates, almost $90,000.” Although the court did not explicitly state that it was adopting the PSR, that was the court’s obvious intent. The government proffered, and the PSR suggested, only one factual theory under which defendant could have been held liable for stolen property valued at $89,640. U.S. v. Martin, 157 F.3d 46 (2d Cir. 1998).
2nd Circuit holds possessing unsold stolen parts was relevant conduct to transporting stolen parts. (175) Defendant operated a company that restored aircraft and bought and sold aircraft parts. He was convicted of transporting stolen aircraft parts in interstate commerce. The district court found that his possession of additional stolen parts that he never sold or transported was relevant conduct. The Second Circuit agreed that defendant’s possession of unsold stolen parts from the same victim as the parts he transported in interstate commerce easily qualified as relevant conduct. The offenses were part of a common scheme or plan because they had a common victim, a common time period, and a common type of merchandise. At a minimum, defendant’s possession of stolen parts was part of the same course of conduct as his transportation of stolen parts. The charged and uncharged offenses were similar: all involved avionics equipment stolen from the same airline, the offenses occurred within a short period of time, and the sales, possessions, and attempted sales were repetitious. U.S. v. Martin, 157 F.3d 46 (2d Cir. 1998).
2nd Circuit rules relevant conduct required increase for more than one victim. (175) Defendant pled guilty to making a false statement in connection with a loan application. However, from 1988 to 1990, defendant actually defrauded three banks. In determining the amount of restitution, the district court found that defendant’s scheme to defraud the other two banks constituted relevant conduct. However, it declined to apply a § 2F1.1(b)(2)(B) enhancement for defrauding more than one victim, stating that the enhancement was not applicable because there was only one victim in the count to which defendant pled guilty. The Second Circuit ruled that the court should have applied the more than one victim enhancement based on the relevant conduct. Once the district court found that the schemes to defraud the other two banks constituted relevant conduct, it was not free to disregard those schemes in determining whether to apply the § 2F1.1(b) (2)(B) enhancement. U.S. v. Shumard, 120 F.3d 339 (2d Cir. 1997).
2nd Circuit holds relevant conduct is not part of continuing offense for ex post facto purposes. (175) Defendant permitted others to dump construction and demolition debris at his property in violation of environmental regulations. He misrepresented his actions to the Pennsylvania Department of Environmental Resources (PADER) and falsely represented to private waste haulers that he had a permit to operate such a landfill. PADER closed the landfill in October 1989, and defendant unsuccessfully sought to reopen it through fraudulent means. He was convicted of wire fraud in connection with his misrepresentations to the waste haulers. The district court applied the November 1989 guidelines, reasoning that the offense continued past October 1989 by virtue of his fraudulent efforts to obtain permission from PADER to reopen the landfill. The Second Circuit held that this was not part of the offense of conviction, and using the November 1989 guidelines violated the ex post facto clause. The count of conviction did not encompass fraud against PADER. Note 2 to § 1B1.11 provides that the last date of the offense of conviction is the controlling date for ex post facto purposes, and the date of relevant conduct may not be substituted. U.S. v. Zagari, 111 F.3d 307 (2d Cir. 1997).
2nd Circuit bases laundered amount on acquitted conduct. (175) The district court added three points to defendant’s offense level for having laundered over $500,000. Defendant asserted that this represented the total amount of laundered funds charged in all 28 money laundering counts and 14 related racketeering acts, despite the fact that he was acquitted of all but 6 of the money laundering counts and 3 of the related racketeering acts. The amounts involved in the counts of conviction totaled only $70,000. The Second Circuit held that the district court properly enhanced defendant’s sentence based on acquitted conduct that the district court found to have occurred by a preponderance of the evidence. U.S. v. Zagari, 111 F.3d 307 (2d Cir. 1997).
2nd Circuit upholds defendant’s involvement in relevant conduct. (175) Defendant pled guilty to racketeering charges. The district court took into account as relevant conduct three kidnappings for which defendant was not indicted. The Second Circuit held that the government adequately proved defendant’s involvement in the kidnappings. Two witnesses testified that they personally observed defendant take part in the first attempted kidnapping. Although defendant’s polygraph test results suggested the truthfulness of his denials, such “lie‑detector” tests are not generally admissible in federal court because of their questionable accuracy. Defendant’s participation in the second kidnapping presented a closer question, because several witnesses testified that defendant was socially occupied elsewhere at the time of the kidnapping. However, faced with two contradictory accounts of defendant’s activities that day, each supported by eyewitness testimony, the district court’s resolution was not improper. U.S. v. Ruggiero, 100 F.3d 284 (2d Cir. 1996).
2nd Circuit extends relevant conduct to date of defendant’s arrest on similar state charges. (175) Defendant shoplifted merchandise, and then conspired to transport the stolen goods in interstate commerce. She had 40 prior convictions for larceny, receiving stolen property, forgery and theft. Her most recent offense was a 1992 Vermont conviction for felony theft based on similar shoplifting conduct. Note 8 to § 1B1.3 states that conduct associated with a sentence that was imposed prior to the acts constituting the instant federal offense should not be considered relevant conduct. The 2nd Circuit upheld the district court’s determination that the period of defendant’s relevant conduct began on October 28, 1991, the date she was arrested on the Vermont offense, rather than on February 4, 1992, the date on which she was sentenced for that offense. Defendant made no showing that the state court took her post-arrest theft activity into account in setting her state sentence. U.S. v. Defeo, 36 F.3d 272 (2nd Cir. 1994).
2nd Circuit considers conduct outside statute of limitations to determine loss. (175) Defendant fraudulently received social security benefits from May 1979 until November 1991. He argued that the statute of limitations barred consideration of losses outside its five-year window. The 2nd Circuit disagreed, holding that a court may rely on conduct outside the statute of limitations in calculating a term of imprisonment under the guidelines. Where a defendant engages in an identifiable and repetitive pattern of criminal activity, as in this case, the court may rely on such conduct as relevant, regardless of whether it is charged as part of the offense of conviction. Statute of limitations jurisprudence does not alter this analysis. U.S. v. Silkowski, 32 F.3d 682 (2nd Cir. 1994).
2nd Circuit does not decide whether uncharged crimes were relevant conduct since they also provided basis for departure. (175) Defendant was convicted of RICO and Hobbs Act offenses. The district court increased his offense level based on his participation in certain crimes that were not alleged in the indictment as predicate RICO or Hobbs Act crimes. Defendant argued that the uncharged predicate acts could not be considered as relevant conduct because they would not be appropriate for grouping under § 3D1.2(d). The 2nd Circuit found it unnecessary to examine this claim since the court stated that if the crimes could not be considered relevant conduct, it would depart upward to reach the same sentence. The uncharged conduct related to defendant’s RICO and Hobbs Act offenses. Therefore, even if the uncharged crimes were not technically relevant conduct under § 1B1.3, they formed an appropriate basis for an upward departure. U.S. v. Thai, 29 F.3d 785 (2nd Cir. 1994).
2nd Circuit permits downward departure if sentence is greatly increased for acquitted conduct. (175) The jury convicted defendant of simple possession of crack, but acquitted him of possession with intent to distribute. The district judge reluctantly imposed a 135-month sentence, stating that the sentence was grossly disproportionate to the offense, and that he would have departed if he thought he had the power under the facts of the case. The 2nd Circuit held that the judge may have not fully understood his power to depart under section 3553(b). The court cited U.S. v. Concepcion, 983 F.2d 369 (2nd Cir. 1992), which stated that a court has the power to depart where the relevant conduct guideline would require an extraordinary increase in sentence by reason of conduct for which a defendant was acquitted by the jury. U.S. v. Monk, 15 F.3d 25 (2nd Cir. 1994), overruled on other grounds by U.S. v. Thomas, 274 F.3d 655 (2d Cir. 2001).
2nd Circuit considers drug conspiracy in determining prison offense guideline. (175) Defendant, a corrections officer, was convicted of providing inmates with alcohol and escape equipment. He also admitted, but was not convicted of, providing the inmates with cocaine. The 2nd Circuit basing defendant’s sentence on section 2P1.2(c)(1), which provides that defendants convicted of 18 U.S.C. 1791(a)(1) should be sentenced under the narcotics guideline in section 2D1.1. By providing inmates with cocaine, defendant’s conduct violated 18 U.S.C. 1791(a) and therefore the cross-reference in section 2P1.2(c)(1) applied. The fact that defendant was convicted of conspiracy rather than the substantive offense, was irrelevant. Nor did applying the cross-reference for conspiracy violate the ex post facto clause. The November 1, 1991 amendment to application note 5 of section 1B1.3, which provided that conspiracy offenses are to be treated like substantive offenses, was a clarification, rather than a change in the substantive law. U.S. v. Mapp, 990 F.2d 58 (2nd Cir. 1993).
2nd Circuit upholds stolen property enhancement based on dismissed counts. (175) The district court imposed an enhancement under section 2B1.2(b)(1) for possessing stolen property worth $2,460 based on facts contained in the dismissed count of defendant’s indictment. The 2nd Circuit rejected the claim that basing a sentence enhancement upon the dismissed count violated defendant’s due process, double jeopardy, or 8th Amendment rights. A court may rely upon facts not proven beyond a reasonable doubt in sentencing. A defendant’s right to be free from double jeopardy is not infringed by enhancements based upon acquitted, much less dismissed, counts of an indictment. There was no 8th Amendment violation since defendant’s 18-month sentence was 102 months less than the statutory maximum. U.S. v. Streich, 987 F.2d 104 (2nd Cir. 1993).
2nd Circuit says considering acquitted conduct and consecutive sentence did not violate double jeopardy. (175) Defendant was acquitted of narcotics charges and convicted of several firearms offenses. Both firearm guidelines, section 2K2.1 and section 2K2.2 (1988), provide that if the firearm was used in connection with another offense, a court is to apply the other guideline if it would result in a higher offense level. The district court found that defendant had used the firearms in connection with a narcotics conspiracy, and therefore sentenced him under section 2D1.1. The 2nd Circuit rejected defendant’s claim that the district court’s consideration at sentencing of the acquitted conduct constituted double jeopardy. In considering the acquitted conduct as a basis for enhancing defendant’s sentence, the district court was not punishing the defendant for the extraneous offense, but justifying the heavier penalties for the offense of conviction. Nor did the consecutive sentences defendant received for his two firearms offenses violate double jeopardy. There was no question that the offense of possession of an unregistered weapon and possession of a weapon as a previously convicted felon were distinct. Judge Newman dissented from the denial of a petition for rehearing en banc. U.S. v. Concepcion, 983 F.2d 369 (2nd Cir. 1992).
2nd Circuit finds no justification for increased bribery sentence either as “relevant conduct” or as “departure.” (175) Defendant was convicted of one bribery scheme but acquitted of another. At sentencing, the judge found “by a preponderance of the evidence” that the acquitted bribery “occurred,” and doubled defendant’s offense level from 10 to 20. It was unclear whether the increase in offense level was based on a finding that the second bribery was “relevant conduct” under U.S.S.G. 1B1.3 or an upward departure. The 2nd Circuit found both rationales faulty. Bribery and extortion are not required to be “grouped” under the multiple count section, 3D1.2(d), and therefore evidence of these offenses is excluded from “relevant conduct” under 1B1.3. If the judge intended to depart upward from the guidelines, he failed to articulate sufficient reasons for doing so. U.S. v. Stephenson, 895 F.2d 867 (2nd Cir. 1990).
3rd Circuit rules arrest five months later was not relevant conduct. (175) In February 2007, state troopers found $9,000 in cash in the glove compartment of defendant’s car, a small amount of marijuana, and a handgun. They also found a revolver inside a backpack in the trunk. In July 2007, during a fire-code inspection of defendant’s girlfriend’s apartment, a local fire marshal saw a handgun next to the bed where defendant was sleeping. Defendant pled guilty to being a felon in possession of a firearm. The Third Circuit held that the district court erred in finding that the July incident was relevant conduct for purposes of sentencing him for the February felon in possession incident. The five-month interval between the offenses was not of such duration as to render the events of July too remote from the events of February. However, where the time between offenses is not strongly supportive of finding relevant conduct, the offenses must show significant similarity and regularity. The February and July offenses were not sufficiently similar or regular to satisfy the relevant conduct standard. Although both incidents involved a stolen firearm in relatively close proximity to cash and a small quantity of marijuana, these facts alone were not sufficient to show more than a pair of similar but isolated and unrelated events. U.S. v. West, 643 F.3d 102 (3d Cir. 2011).
3rd Circuit approves use of conduct outside statute of limitations. (175) From 1974 until September 1995, defendant cashed 257 Social Security checks issued to her dead father. She was only charged with fraudulently cashing 43 benefit checks, since the other 214 checks were cashed outside the statute of limitations. Nonetheless, the district court considered these 214 checks in determining the total loss. The Third Circuit agreed that conduct outside the statute of limitations may be considered as relevant conduct in determining the appropriate guideline sentence. The court also rejected defendant’s claim that the court’s findings regarding the 214 checks was based on unreliable information. Defendant admitted cashing the 214 checks, but argued that she did not commit fraud because she was cashing the checks for a cousin who she believed was authorized to receive the money. However, defendant could not give an address or date of birth for the alleged cousin, and defendant’s son said he had never heard of any cousin and did not believe his mother. U.S. v. Stephens, 198 F.3d 389 (3d Cir. 1999).
3rd Circuit considers uncharged bribes defendant admitted to probation officer. (175) Defendant, an INS employee, accepted bribes in return for INS metal templates, a device that imprints a marking when fingerprints and signatures are affixed to alien registration “green” cards to demonstrate authenticity. He argued that it was improper to increase his offense level under § 2C1.1(b)(1) based on his admissions to the probation department that he had accepted two additional bribes that were not the subject of a charge. The Third Circuit upheld consideration of the uncharged bribes because they involved relevant conduct. The cooperating witness who paid all three bribes was a highly credible witness, and provided the probation department with information concerning his and defendant’s respective roles in each of the three bribes. That information was corroborated by tape recorded conversations and by defendant’s own admissions. Uncharged relevant conduct can be the basis of a sentencing enhancement. The consideration of defendant’s statements to the probation officer did not violate due process. Defendant was not forced to admit the relevant conduct in order to obtain a § 3E1.1 reduction. The guidelines permit a defendant to remain silent about relevant conduct without affecting his ability to obtain a § 3E1.1 reduction. U.S. v. Rudolph, 137 F.3d 173 (3d Cir. 1998).
3rd Circuit holds that relevant conduct in a RICO case includes all reasonably foreseeable conduct in furtherance of RICO enterprise. (175) The 3rd Circuit held that relevant conduct in a RICO case includes all conduct reasonably foreseeable to a particular defendant in furtherance of the RICO enterprise to which he belongs. The term “underlying racketeering activity” in section 2E1.1(a)(2) means any act, whether or not charged against defendant personally, that qualifies as a RICO predicate act under 18 U.S.C. section 1961(a) and is otherwise relevant conduct under section 1B1.3. The district court erred when it limited relevant conduct to conduct in furtherance of the predicate acts charged against defendant. However, such relevant conduct could not be used to increase the statutory maximum from 20 years to a term of life imprisonment. The statutory maximum sentence must be determined by the conduct alleged in the indictment. U.S. v. Carrozza, 4 F.3d 70 (3rd Cir. 1993).
3rd Circuit upholds sentencing kidnapper under criminal sexual abuse guideline. (175) Defendant was convicted of kidnapping and related counts for abducting young boys or luring them back to his apartment, where he drugged them and then sexually abused them. The kidnapping guideline, section 2A4.1, states that if the victim was kidnapped to facilitate the commission of another offense, the guideline for such offense should be used if it results in a higher offense level. The 3rd Circuit affirmed that it was proper to sentence defendant under the guideline for criminal sexual abuse, section 2A3.1, even though he was never charged with that offense, and the federal court lacked jurisdiction to try him for it. There is no requirement that a defendant be convicted of conduct before the conduct may be considered in sentencing. A district court may consider uncharged, relevant state conduct as well as federal conduct. Once a jurisdictional basis existed over the kidnappings, then all relevant conduct could properly be considered in defendant’s sentence. U.S. v. Pollard, 986 F.2d 44 (3rd Cir. 1993).
3rd Circuit affirms enhancement based on dismissed counts in robbery case. (175) Pursuant to a plea agreement, defendant pled guilty to unarmed robbery, while armed robbery and car theft counts were dismissed. Nonetheless, the district court increased defendant’s base offense level by three under guideline section 2B3.1 because defendant possessed a firearm during the robbery. The 3rd Circuit upheld the enhancement, finding the guidelines require relevant conduct to be considered in determining specific offense characteristics, even though such conduct underlies a count dismissed in a plea bargain. Following the 11th Circuit’s decision in U.S. v. Scroggins, 880 F.2d 1204 (11th Cir. 1989), the court rejected defendant’s claim that this rendered his plea bargain meaningless. Prior to his plea, the government gave defendant a copy of a case describing a sentence enhancement for possession of a weapon during a robbery, so any expectation that the district court would not rely on the weapon was unfounded. Moreover, the plea bargain was not entirely empty because the car theft count was dismissed. U.S. v. Frierson, 945 F.2d 650 (3rd Cir. 1991).
3rd Circuit determines amount of loss from base amount of stolen treasury checks. (175) Defendant contended that the district court could not calculate amount of loss by looking at the face value of stolen treasury checks. The 3rd Circuit held that the court properly determined the amount of loss by looking at the face value of the checks and not the amount defendant received for them. The court also found the amount of loss schedule entirely neutral as to the socioeconomic status of offenders as required by 28 U.S.C. § 944(d). Finally, the district court properly considered, under the relevant conduct § 1B1.3, checks (sold by an acquitted co-defendant) for which defendant was not charged. This allows a sentencing court to consider unadjudicated conduct. U.S. v. Cianscewski, 894 F.2d 74 (3rd Cir. 1990).
4th Circuit upholds enhancement, despite acquittal, for possessing sawed-off shotgun. (175) Police discovered a sawed-off shotgun and ammunition in defendant’s car. He was convicted of being a felon in possession of ammunition, but the jury acquitted him of possessing the sawed-off shotgun. Nonetheless, the district court found by a preponderance of the evidence that he possessed the sawed-off shotgun, and applied an enhanced offense level of 26 under § 2K2.1(a)(1). The Fourth Circuit upheld the district court’s finding that defendant possessed the sawed-off shotgun. Given the lesser standard of proof at sentencing, the fact that the jury acquitted defendant of firearms charges did not preclude the court from finding that defendant did in fact possess a firearm. Defendant had argued that the absence of his fingerprints, DNA, hair, fiber, or other physical evidence on the firearm prohibited a finding that he possessed the weapon. However, constructive possession may be established through circumstantial evidence. Here, there was evidence and witness testimony that defendant was the owner and driver of the vehicle in which the firearm was found. Moreover, the shotgun was loaded with the same ammunition found in the vehicle, which was the ammunition defendant was convicted of possessing. U.S. v. Lawing, 703 F.3d 229 (4th Cir. 2012).
4th Circuit upholds tax loss calculation, despite acquittal of some tax evasion charges. (175) Defendant and her husband, former co-pastors of a church, evaded taxes by omitting millions of dollars of taxable income from their jointly filed tax returns. The district court found that defendant was responsible for a combined tax loss of $1,174,921 for the years 1998-2008. However, the jury acquitted defendant of tax evasion for years preceding 2005. She argued that the pre-2005 amounts should not have been included in the tax loss. The Fourth Circuit disagreed. An acquittal does not establish a defendant’s lack of criminal culpability. The district court found a pattern of “long-term conduct” that went on for about a decade. Unlike the three tax evasion counts for which defendant was acquitted, both she and her husband were convicted of conspiracy. Count one of the indictment charged defendants with conspiring to defraud the U.S. between 2002 and 2008, and alleged overt acts in furtherance of the conspiracy committed as early as 1991 and 1998. There was ample evidence for the court to conclude that losses arising from acts committed before 2002 occurred as part of the same course of conduct or common scheme or plan. U.S. v. Jinwright, 683 F.3d 109 (4th Cir. 2012).
4th Circuit holds that acquittal did not bar defendants from offering rebuttal evidence. (175) Defendants, officers of the United Way of America, were originally convicted of fraud, money laundering, and tax evasion stemming from their improper use of UWA money. They had also been charged with defrauding PUI, a support organization related to UWA. However, they successfully moved for judgments of acquittal on the PUI counts at the close of the government’s case-in-chief. They contended that the PUI losses should not have been counted as relevant conduct because their judgments of acquittal at the close of the government’s case-in-chief effectively precluded them from rebutting their PSRs’ findings detailing the frauds against PUI. These findings were based upon evidence presented at trial during the government’s case-in-chief. The Fourth Circuit held that defendants had ample opportunities to submit rebuttal evidence. First, they had the opportunity to object to all of the factual findings in their PSRs, and to submit any rebuttal evidence they wanted the court to consider. Second, neither defendant proffered any rebuttal evidence at their respective sentencing hearings. U.S. v. Aramony, 166 F.3d 655 (4th Cir. 1999).
4th Circuit approves of use of four previous mail thefts as relevant conduct. (175) Defendant pled guilty to a single count of stealing an article of registered mail. The 4th Circuit upheld the court’s use of four previous thefts of cash and currency from the mail as relevant conduct in determining his sentence. The government presented evidence that (a) mail containing cash and checks had been stolen from a registered mail pouch dispatched from one post office on four different Saturdays, (b) defendant was the mail driver on each of these occasions, (c) defendant had access to the registered mail pouch, (d) defendant was the only person who could have broken the seal on the trailer on the relevant dates, and (e) defendant had regularly seen postal workers counting money prior to its dispatch and often asked how much cash was in the shipment. U.S. v. Jones, 31 F.3d 1304 (4th Cir. 1994).
4th Circuit upholds considering acquitted conduct against double jeopardy and due process claims. (175) Defendant was convicted of drug charges and acquitted of using a firearm in connection with a drug trafficking offense. Nevertheless, the court enhanced his sentence under section 2D1.1(b)(1) for possession of a firearm during a drug trafficking offense. The 4th Circuit held that considering the evidence underlying the acquitted count did not violate due process or double jeopardy. If there is no separate punishment for the acquitted conduct, there is no double jeopardy. Here, the evidence was considered only in determining the point within the statutory and guideline range at which his sentence was to be imposed. The use of acquitted evidence at sentencing satisfies due process so long as the facts necessary for sentencing are proved by a preponderance of the evidence. U.S. v. Nelson, 6 F.3d 1049 (4th Cir. 1993), overruled on other grounds by Bailey v. U.S., 516 U.S. 137 (1995).
4th Circuit upholds firearms enhancement despite acquittal on firearms count. (175) Defendant was convicted of drug charges and acquitted of using a firearm in connection with a drug trafficking offense. Nevertheless, his sentence was enhanced under section 2D1.1(b)(1) for possession of a firearm during a drug trafficking offense. The enhancement increased his guidelines by a range of 57 to 72 months. Defendant complained that if he had been convicted of the firearms offense, he would have faced only an additional 60 months. The 4th Circuit upheld the enhancement. The district court sentenced defendant at the bottom of the range and therefore he was not harmed. The evidence supported the enhancement. It was reasonably foreseeable to defendant that guns would be located at the house at which his co-conspirators manufactured, stored and distributed crack cocaine. U.S. v. Nelson, 6 F.3d 1049 (4th Cir. 1993), overruled on other grounds by Bailey v. U.S., 516 U.S. 137 (1995).
4th Circuit holds that uncharged fraud was not part of same course of conduct. (175) Defendant was convicted of aiding and abetting his brother’s fraud scheme for making fraudulent misrepresentations to his brother’s creditor. The 4th Circuit reversed the district court’s determination that defendant’s involvement with his brother’s separate fraud scheme against several life insurance companies was relevant conduct for purposes of determining the amount of loss under section 2F1.1. The life insurance fraud was not “part of the same course of conduct or common scheme or plan” as the offense of conviction. The significant elements to be evaluated are similarity, regularity and temporal proximity between the offense of conviction and the uncharged conduct. The fact that the same three individuals were involved in the two schemes did not make the schemes sufficiently similar. In addition, defendant’s willingness to aid his brother’s fraudulent endeavors did not provide a sufficient link between the frauds. Moreover, the distinctions between the schemes were quite significant. U.S. v. Mullins, 971 F.2d 1138 (4th Cir. 1992).
4th Circuit affirms firearm enhancement despite acquittal on firearms charge. (175) Defendant was convicted of possession of crack cocaine and acquitted of carrying a firearm in relation to a drug trafficking crime. Nonetheless, the district court found as a factual matter that defendant possessed the weapon and enhanced defendant’s base offense level by two under guideline section 2D1.1(b)(1) for possessing a dangerous weapon during a drug crime. The 4th Circuit upheld the enhancement against double jeopardy and due process challenges, ruling that acquitted conduct can properly be used to enhance a sentence once the requisite finding has been made. U.S. v. Romulus, 949 F.2d 713 (4th Cir. 1991).
4th Circuit upholds consideration of prior uncharged crimes against due process challenge. (175) Defendant contended that it violated due process to consider his prior uncharged acts of tax fraud at sentencing. The 4th Circuit upheld the consideration of the prior uncharged crimes. Due process rights are not as extensive at sentencing as they are at trial. A judge may rely, at sentencing, upon any information so long as it has sufficient indicia of reliability. For defendant to prevail, he would have to show that the information concerning his prior acts of tax fraud was false and unreliable. Instead, the court below found by a preponderance of the evidence that these offenses had occurred. Therefore, there was no due process violation. U.S. v. Turner, 925 F.2d 1458 (4th Cir. 1991).
4th Circuit rules that acquittal of counterfeiting charge does not preclude offense level enhancement following conviction of dealing with counterfeit obligations. (175) Defendant was convicted of dealing with counterfeit obligations, but the jury acquitted him of the more serious offense of counterfeiting. He argued that it violated the due process clause for the court to enhance his offense level from 9 to 15 according to § 2B5.1(b)(2). The 4th Circuit affirmed the enhancement, holding that merely because the jury acquitted the defendant of the more serious count, it was not improper for the guidelines to consider evidence connected with that count in sentencing. This is especially true given the fact that a lower standard of proof applies at sentencing. “A verdict of acquittal demonstrates only a lack of proof beyond a reasonable doubt; it does not necessarily establish the defendant’s innocence.” Furthermore, the reference to a defendant’s intent in § 1B1.3(a)(4) [relevant conduct] does not mandate proof beyond a reasonable doubt that the defendant possessed the necessary mens rea as required by the count for which he was acquitted when he is sentenced on the count of conviction. U.S. v. Isom, 886 F.2d 736 (4th Cir. 1989).
5th Circuit holds defendant accountable for checks cashed by friends, associates and family members. (175) Defendants conspired with a claims adjuster to make hundreds of fraudulent claims against the City of Garland, Texas, resulting in a loss of about $1.9 million. The district court attributed to one defendant a loss of $304,553.62, based on the 14 checks he cashed and 25 checks made payable to his friends, associates, and family members. Defendant contended that he should only have been held responsible for the checks he actually endorsed. The Fifth Circuit disagreed. Guideline § 1B1.3(a) (1)(B) provides that a defendant is responsible for “all reasonably foreseeable acts and omissions of others in furtherance of the jointly undertaken criminal activity.” The district court’s finding that the loss resulting from the checks cashed by other members of the conspiracy was reasonably foreseeable to defendant was well supported. Defendant recruited others to join, cashed checks when others backed out, and was a central cog in the conspiracy: his spouse, children, aunt, cousins, in-laws, business partner, employees, and friends cashed one or more fraudulent checks. U.S. v. Brown, 727 F.3d 329 (5th Cir. 2013).
5th Circuit includes uncharged fraudulent transactions as relevant conduct in mortgage fraud. (175) Defendant engaged in a series of transactions in which he purchased houses and then sold them at inflated prices to investors. Defendant pocketed the difference between his purchase price and the price at which he sold to the investors. Based on this conduct, defendant was convicted of bank fraud, wire fraud, and money laundering. At sentencing, the district court calculated the loss caused by defendant’s offense based both on the fraudulent real estate sales charged in the indictment and other uncharged sales. The Fifth Circuit held that the uncharged sales constituted relevant conduct and that the district court properly included the losses caused by those sales in the loss attributable to defendant’s offense. U.S. v. Cooks, 589 F.3d 173 (5th Cir. 2009).
5th Circuit holds that losses from separate fraudulent company were not relevant conduct. (175) Defendant, who owned and operated a medical supply company, engaged in a fraudulent Medicare billing scheme. Don Usanga helped defendant set up his company, and the district court found that defendant had entered into a jointly undertaken criminal activity involving Mendus Medical, Usanga’s fraudulent medical equipment company. The court found that losses caused by Usanga and Mendus Medical were relevant conduct for sentencing purposes. The Fifth Circuit reversed. At most, the evidence established that Usanga provided start-up and operational support to defendant’s company, and that the two companies ran similar schemes. There was no indication that defendant agreed to jointly undertake a distinct business with Mendus, or that defendant assisted in the planning, provided material support, or shared in the profits of Mendus. No payments were made from Mendus to defendant. Defendant’s mere awareness that Usanga was operating an identical fraudulent scheme was insufficient to hold defendant responsible for Usanga’s actions. U.S. v. Ekanem, 555 F.3d 172 (5th Cir. 2009).
5th Circuit relies on conduct involved in reversed convictions to apply increase for more than one extortion. (175) Defendant, the former police commissioner of a small city in Texas, was convicted of extortion and wire fraud in connection with a traffic ticket scheme. The district court applied a § 2C1.1(b)(1) increase because it found that defendant’s offenses involved more than one extortion “based upon the evidence at trial.” Defendant argued that because the court reversed a number of the convictions as unsupported by the evidence, the enhancement was improper. The Fifth Circuit disagreed. While it had reversed his convictions for several of the extortionate acts, this did not remove those acts from the universe of relevant conduct. The extortions of the non-interstate travelers, which were proven by a preponderance of the evidence, as well as the testimony of a co-conspirator as to the overall scheme to extort, was sufficient to support a finding that defendant participated in more than one extortionate act. The district court did not err in applying this increase. U.S. v. Mann, 493 F.3d 484 (5th Cir. 2007).
5th Circuit relies on conduct involved in reversed convictions to apply increase for more than one extortion. (175) Defendant, the former police commissioner of a small city in Texas, was convicted of extortion and wire fraud in connection with a traffic ticket scheme. The district court applied a § 2C1.1(b)(1) increase because it found that defendant’s offenses involved more than one extortion “based upon the evidence at trial.” Defendant argued that because the court reversed a number of the convictions as unsupported by the evidence, the enhancement was improper. The Fifth Circuit disagreed. While it had reversed his convictions for several of the extortionate acts, this did not remove those acts from the universe of relevant conduct. The extortions of the non-interstate travelers, which were proven by a preponderance of the evidence, as well as the testimony of a co-conspirator as to the overall scheme to extort, was sufficient to support a finding that defendant participated in more than one extortionate act. The district court did not err in applying this increase. U.S. v. Mann, 493 F.3d 484 (5th Cir. 2007).
5th Circuit holds that possession of sadistic pictures was not relevant conduct to sending pornography. (175) Defendant sent child pornography via the Internet to “Katrina,” an undercover agent. Police recovered from his residence several electronic images of sadistic sexual conduct, two of them depicting minors. The Fifth Circuit reversed a § 2G2.2(b)(3) increase for sadistic material, holding that defendant’s receipt and possession of the sadistic pictures was not relevant conduct to his transmission of child pornography. The electronic mailing occurred at a discrete moment, and defendant’s receipt of the other, sadistic images did not occur “during the commission of the offense of conviction.” USSG § 1B1.3(a)(1). Defendant’s possession of the sadistic pictures and the offense of conviction were not part of a “common scheme or plan.” USSG § 1B1.3(a)(2). If anything, the record showed that defendant refrained from sending the pictures to Katrina because he believed they would have impaired his efforts to entice her. Defendant’s receipt of the sadistic pictures and his transmission of the non-sadistic pictures were not sufficiently related to be part of “the same course of conduct.” The sadistic pictures of the two minors had dates of 1996. Defendant’s communications with Katrina did not begin until December 1997. The government did not show that defendant’s receipt of the sadistic images were part of the plan to entice Katrina. Judge Garza dissented. U.S. v. Fowler, 216 F.3d 459 (5th Cir. 2000).
5th Circuit says salespeople were not responsible for losses incurred outside period of employment. (175) Defendants committed bank fraud in the financing of A-1 mobile homes by obtaining bank financing for customers who had not made adequate down payments. The Fifth Circuit found that the district court properly determined the loss attributable to three “key men” in the conspiracy (a bank vice president, the owner of the mobile home franchises, and his partner). However, the court committed clear error by attributing to sales representatives losses incurred outside their period of employment with A-1. These employees gathered and submitted false information as a function of their job at a particular A-1 lot. Thus, the scope of the criminal activity each salesperson agreed to jointly undertake was limited to those loans that were processed at the particular lot at which that defendant was employed. The sales reps should not have been held accountable at sentencing for fraudulent loans made after leaving A-1’s employ. U.S. v. Morrow, 177 F.3d 272 (5th Cir. 1999).
5th Circuit says uncharged timber thefts were relevant conduct. (175) Defendant illegally harvested timber from four Louisiana properties owned by non-resident owners. The Fifth Circuit agreed that four uncharged timber thefts were sufficiently connected to the offense conduct to constitute relevant conduct. The charged and uncharged thefts had a common purpose: the illegal removal and sale of timber that did not belong to defendant. The thefts also had a similar modus operandi: the removal of timber from land belonging to absentee landowners, and the removal of timber from land adjacent to land that defendant had permission to harvest. Although the uncharged incidents occurred over a period of several years, there is no separate statute of limitations beyond which relevant conduct suddenly becomes irrelevant. The incidents occurred regularly, with the last one occurring nine months before the events alleged in the indictment. However, the court erred in holding that another incident in which a second defendant allegedly damaged property was relevant conduct. The incident did not implicate any criminal conduct. U.S. v. Anderson, 174 F.3d 515 (5th Cir. 1999).
5th Circuit holds that theft of letters from postal worker was reasonably foreseeable. (175) An unidentified person stole two bundles of mail from a postal worker at gunpoint. The mail, minus Social Security checks, was found several blocks away. Using false identification, defendant later cashed a check stolen from these bundles of mail. The Fifth Circuit upheld a § 2B1.1(b)(2) enhancement for theft from the person of another, ruling that the theft from the postal worker was relevant conduct. Defendant admitted that he had been cashing checks for the couple who gave him the check and the false ID for several months. In addition, fingerprints of defendant and his associate were found on mail recovered 30 minutes after the theft and about eight blocks from the scene. U.S. v. Nevels, 160 F.3d 226 (5th Cir. 1998).
5th Circuit says defendant acquitted of conspiracy still liable for losses caused by co-conspirators. (175) Defendant worked as a salesman for an investment company that defrauded over 100 investors of more than $2.3 million. He contended that his acquittal on conspiracy charges precluded the court from holding him liable for losses caused by his co-defendants. The Fifth Circuit held that defendant was accountable for losses caused by his co-defendants, despite the conspiracy acquittal. To get a conviction, the government must prove all elements of a criminal offense beyond a reasonable doubt. However, the findings of fact for sentencing purposes need only meet the lower preponderance of the evidence standard. Thus, a finding that defendant was a conspirator for sentencing purposes is not inconsistent with a finding that he was not guilty of conspiracy. A defendant is liable for the reasonably foreseeable acts of co-defendants in joint criminal activity. Defendant had a close association with his co-defendants and transported checks he knew they had obtained by fraud. U.S. v. Hull, 160 F.3d 265 (5th Cir. 1998).
5th Circuit holds telemarketer liable for all losses from conspiracy. (175) Defendant worked for two years as a broker and a telemarketer for a company that defrauded over 100 investors of more than $2.3 million. The Fifth Circuit ruled that defendant was properly held accountable for all the losses caused by the conspiracy. The losses were reasonably foreseeable to defendant and his agreement embraced the entirety of the conspiracy. His nearly two years of involvement, in which he worked alongside other “brokers” who peddled the conspiracy’s fraudulent pitches, evidenced both his notice of and acquiescence to the scope of the conspiracy. The court made sufficiently particularized findings that the elements of foreseeability and scope of agreement had been met. U.S. v. Hull, 160 F.3d 265 (5th Cir. 1998).
5th Circuit permits upward departure for conduct that is not “relevant conduct.” (175) Defendant pled guilty to firearms charges. In departing upward, the court relied on a videotape of defendant demonstrating how to make a silencer. Defendant argued that it was improper to consider the videotape in its upward departure analysis because his participation in making the videotape was not itself illegal. The Fifth Circuit held that a court can consider conduct that is not itself criminal or “relevant conduct” under § 1B1.3 in determining whether an upward departure is warranted. A district court is not limited to considering only acts that are criminal or illegal when contemplating a departure. In November 1990, the Sentencing Commission eliminated language from § 5K2.0 which suggested that only relevant conduct could be considered in departing upward. The Commission stated that this language was “unclear and overly restrictive.” U.S. v. Arce, 118 F.3d 335 (5th Cir. 1997).
5th Circuit rules acquittal does not prevent application of cross-reference. (175) Defendant was a Branch Davidian involved in a gun battle between the Davidians and the ATF. He was convicted of firearms charges, but acquitted of conspiring to murder federal agents. Section 2K2.1(c)(1) directs the court to apply § 2X1.1 if the defendant used the firearm in connection with another offense, and § 2X1.1 directs the court to apply the guideline for the substantive offense. Note 2 provides that substantive offense means the offense defendant was convicted of conspiring to commit. The district court found that defendant was involved in a conspiracy that resulted in the murder of four federal agents. The Fifth Circuit rejected defendant’s claim that his acquittal for conspiring to murder federal agents barred application of the cross‑reference. Generally, a sentencing court may rely on facts underlying an acquitted count if the preponderance of the evidence standard is satisfied. The language in note 2 to § 2X1.1 does not restrict the court’s ability to use the facts underlying acquitted conduct. This commentary applies only if § 2X1.1 is applied directly, rather than as a cross‑reference from § 2K2.1. U.S. v. Branch, 91 F.3d 699 (5th Cir. 1996).
5th Circuit finds no plain error in considering losses before defendants entered conspiracy. (175) Three defendants were involved in a telemarketing scam. They all contended that the district court erroneously attributed to them losses occurring before they joined the conspiracy. Under U.S. v. Carreon, 11 F.3d 1225 (5th Cir. 1994), reasonable foreseeability under § 1B1.3(a)(1)(B) is prospective only, and cannot include conduct occurring before the defendant joined the conspiracy. Only one of the three defendants objected to the PSR`s use of all of the losses caused by the conspiracy. The Fifth Circuit held that the other two defendants did not show that the district court’s consideration of the losses that occurred before they joined the conspiracy was plain error. Neither defendant demonstrated how the court’s error prejudiced them, and thus neither showed that the error affected her substantial rights. Absent a showing that a substantial right has been compromised, no remedy is available. U.S. v. Sneed, 63 F.3d 381 (5th Cir. 1995).
5th Circuit holds that firearm possession is relevant conduct despite earlier conviction for felon in possession. (175) Defendant’s sentences on two counterfeiting counts were ordered to run concurrently with a sentence in a related case on counterfeiting and firearms charges. Defendant argued that the district court improperly grouped the conviction counts in both cases together, and improperly used defendant’s firearm possession in one case to enhance his sentence in the other. The 5th Circuit found no error. Defendant’s possession of a firearm in his truck with counterfeit bills was properly included as relevant conduct in either of the two related counterfeiting conspiracies. The indictment in the instant case charged that defendant’s previous actions constituted an overt act in furtherance of the instant conspiracy. The firearm would thus be relevant conduct even if defendant had not been convicted of being a felon in possession, or even if the convictions in the two cases had not been grouped together. U.S. v. Wallace, 32 F.3d 921 (5th Cir. 1994).
5th Circuit includes information from related state prosecution as relevant conduct. (175) Defendant pled guilty to possession of stolen mail and other charges. He argued that the district court erred in including a stolen U.S. Treasury check as relevant conduct under § 1B1.3(a) (1)(A) and (B) because the check was the basis of a pending state prosecution against him. The 5th Circuit disagreed, holding that information from a pending state prosecution on a related offense may be used as relevant conduct. U.S. v. Rosogie, 21 F.3d 632 (5th Cir. 1994).
5th Circuit approves use of drugs involved in acquitted conspiracy. (175) Defendant argued that it violated due process to attribute to him marijuana that was part of a conspiracy for which he was acquitted. The 5th Circuit found no merit in defendant’s claim. A district court may base a defendant’s sentence on acquitted conduct because the government need only establish sentencing facts (unlike elements of the crime) by a preponderance of the evidence. U.S. v. Carreon, 11 F.3d 1225 (5th Cir. 1994).
5th Circuit holds “reasonable foresee-ability” inadequate absent finding defendant joined conspiracy. (175) In calculating the loss resulting from defendant’s conduct, the district court included the loss caused by another’s fraud, finding that it was reasonably foreseeable to defendant that the other’s crime would occur. The Fifth Circuit vacated the sentence because the district court failed explicitly to find either that defendant had agreed jointly to undertake criminal activities with the other person or that the other person’s fraud was within the scope of defendant’s agreement. The verbatim recital of 1B1.3 in the presentence report adopted by the district court was no substitute for an explicit finding. U.S. v. Evbuomwan, 992 F.2d 70 (5th Cir. 1993).
5th Circuit considers relevant conduct in determining loss under theft guideline. (175) Defendant was convicted of 14 counts of altering vehicle identification numbers. The 5th Circuit found that since the retail value of each vehicle was agreed upon by the parties, and since retail value was a practical measure of loss, the district court erred in considering incidental costs before retail value. However, the error was harmless since using retail value would have increased defendant’s base offense level. There was evidence that 30 cars were involved in defendant’s scheme. Each had a retail value of $20,000, resulting in a total loss of $600,000. Defendant’s sentence was based on a loss of between $350,000 and $500,000. It would be proper for the district court to consider all of these vehicles as part of defendant’s relevant conduct, for purposes of determining his base offense level. U.S. v. Thomas, 963 F.2d 63 (5th Cir. 1992).
5th Circuit upholds firearm enhancement despite acquittal on 924(c) charges. (175) The 5th Circuit upheld an enhancement under guideline section 2D1.1(b)(1) for possessing a firearm in connection with a drug trafficking offense, despite defendant’s acquittal on charges of carrying a firearm in connection with a drug trafficking offense under 18 U.S.C. section 924(c)(1). U.S. v. Juarez-Ortega, 886 F.2d 747 (5th Cir. 1989), which upheld an enhancement in such a situation, was controlling. Defendant never contested the reliability of the government’s evidence regarding the weapon. U.S. v. Carter, 953 F.2d 1449 (5th Cir. 1992).
5th Circuit affirms consideration of laundered money involved in acquitted counts. (175) The 5th Circuit found no error in the district court’s consideration of laundered money for which her husband was convicted but for which she was acquitted. The government need only prove facts at sentencing by a preponderance of the evidence. Although the jury was not convinced beyond a reasonable doubt that defendant was criminally responsible for the entire sum laundered, the district court could conclude that a preponderance of the evidence supported this conclusion. U.S. v. Allibhai, 939 F.2d 244 (5th Cir. 1991).
5th Circuit upholds consideration of funds involved in transactions that were part of same course of conduct. (175) Defendant pled guilty to two counts of structuring transactions to evade reporting requirements. His offense level was increased under guideline § 2S1.3 because the district court found that the value of the funds involved exceeded $100,000. Defendant argued that this was improper since the money involved in the offense of conviction was less than $100,000. The 5th Circuit upheld the enhancement, finding that the district court could properly consider funds involved in transactions which were part of the same course of conduct or common scheme as the offense of conviction. U.S. v. Rodriguez, 925 F.2d 107 (5th Cir. 1991).
6th Circuit approves sentence based on acquitted drug quantity. (175) At trial, a jury found defendants guilty of conspiracy, but determined that the conspiracy did not involve 1000 or more marijuana plants or 1000 or more kilograms of marijuana. Instead, the jury convicted defendants of a conspiracy involving between 100 and 1000 marijuana plants and 100-1000 kilograms of marijuana. Despite the acquittal, the district court sentenced defendant based on the larger amount. Based on its recent en banc decision in U.S. v. White, 551 F.3d 381 (6th Cir. 2008) (en banc), the Sixth Circuit rejected defendants’ argument that their sentences could not be based on a drug quantity for which the jury had acquitted them. A district court may use acquitted conduct that it finds by a preponderance to enhance a defendant’s sentence “so long as the resulting sentence does not exceed the jury-authorized United States Code maximums.” Here, the acquitted conduct was proven by a preponderance of the evidence. Although it was “an extremely close question,” the district court did not clearly err in concluding that an intercepted truckload of marijuana was attributable to defendants. U.S. v. Young, 553 F.3d 1035 (6th Cir. 2009).
6th Circuit, en banc, allows enhancements to be based on acquitted conduct. (175) Defendant was convicted of armed robbery and possessing a firearm with a serial number that had been removed. He was acquitted of charges relating to the discharge of the firearm in the vault and at pursuing officers, but the district court nonetheless relied on this conduct to support enhancements for discharging a firearm during the robbery, §2B3.1(b)(2), and for assaulting a law enforcement officer during flight, §3A1.2(b)(1). The Sixth Circuit, en banc, held that the district court did not violate defendant’s right to a jury trial by basing the enhancements on acquitted conduct. In U.S. v. Watts, 519 U.S. 148 (1997), the Supreme Court ruled that a sentencing court may consider acquitted conduct, so long as that conduct has been proved by a preponderance of the evidence. Booker did not alter the Watts position on acquitted conduct. In a dissenting opinion, Judge Merritt argued that Watts was irrelevant because the defendant premised his argument not on the Fifth Amendment, but the Sixth Amendment. U.S. v. White, 551 F.3d 381 (6th Cir. 2008) (en banc).
6th Circuit includes 2002 and 2006 firearm possessions in relevant conduct to 2004 possession. (175) Defendant pled guilty to one count of being a felon in possession of a firearm based on his May 2004 possession of several firearms. The guns were found in defendant’s vehicle by officers who arrested him for drunk driving. The district court found that defendant’s illegal possession of firearms in August 2002 and March 2006 was relevant conduct under § 1B1.3(a)(2), resulting in a four-level increase to his base offense level. The Sixth Circuit affirmed. The 2002 and 2006 were “part of the same course of conduct or common scheme or plan” as his felon-in-possession conviction. Although there was a significant time lapse between offenses, there was a substantial similarity between the incidents. Defendant indicated that he carried firearms regularly. U.S. v. Phillips, 516 F.3d 479 (6th Cir. 2008).
6th Circuit permits court to treat conduct underlying dismissed count as “relevant conduct.” (175) Police responding to a suspected burglary at defendant’s house found an unloaded sawed-off shotgun on top of a trash can in the rear of the garage. Defendant admitted that the shotgun was his. An investigation showed that the shotgun was stolen. Police also found firearm ammunition in defendant’s bedroom. Defendant pled guilty to being a felon in possession of ammunition. The district court applied a 12-level enhancement for possession of a stolen shotgun with a barrel of less than 18 inches, and the Sixth Circuit affirmed. Officers recovered the gun from defendant’s residence and defendant admitted on two separate occasions that he owned the gun. The relevant conduct provisions of the Sentencing Guidelines applied to defendant’s possession of the shotgun. The conduct was similar to the offense of conviction, i.e. being a felon in possession of nine-millimeter and assault-rifle ammunition. The offenses also occurred at the same time and at the same place. Thus, the district court could fairly find that defendant’s possession of a sawed-off shotgun should be treated as relevant conduct under Guideline section 1B1.3, which allows consideration of dismissed conduct. U.S. v. Conway, 513 F.3d 640 (6th Cir. 2008).
6th Circuit holds that stolen checks involved in state court offenses were relevant conduct. (175) Defendant was involved in a scheme in which participants stole checks from the mail, altered them, and then cashed them. The indictment charged nine individuals, who collectively stole 36 checks, with defrauding banks of over $43,000. Of this defendant was directly involved in the theft of only one check for 939.56. The district court attributed a loss of over $17,000 to defendant, which included amounts covered by defendant’s state-court convictions on similar charges. The Sixth Circuit agreed that the checks forming the basis for defendant’s state-court convictions qualified as relevant conduct. The modus operandi (stealing mail, washing checks in acetone, and altering the checks’ payees and amounts), the victims (financial institutions in the same town), and the time period (fall 2001) involved in defendants’ state and federal prosecutions were the same. Thus, for purposes of the guidelines’ amount-of-loss calculation, the checks forming the basis for defendant’s state-court convictions qualified as relevant conduct. U.S. v. McDaniel, 398 F.3d 540 (6th Cir. 2005).
6th Circuit holds that relevant conduct must involve offense for which imprisonment can be imposed. (175) Defendant falsely certified to the government that his company had paid workers on a government contract the prevailing wage pursuant to the Davis-Bacon Act, 40 U.S.C. § 276a. The district court included in its loss calculation as relevant conduct the amount of overtime that defendant failed to pay his workers for their work on non-government contracts, in violation of the Fair Labor Standards Act, 29 U.S.C. § 207(a)(1). The Sixth Circuit held that a court may not include conduct in its sentencing calculation under § 1B1.3(a)(2) unless the conduct amounts to an offense for which a criminal defendant could potentially be incarcerated. The FLSA provides for a fine for the first violation; a prison sentence is only available for a defendant previously convicted of violating the Act. Because defendant had no prior convictions under the FLSA, he could not have received any prison time had he been criminally prosecuted for the FLSA violations. Thus, the unpaid overtime wages could not be included as relevant conduct. U.S. v. Shafer, 199 F.3d 826 (6th Cir. 1999).
6th Circuit treats prior frauds and thefts as relevant conduct. (175) Defendant rented a front-end loader and failed to return it the rental company. He pled guilty to one count of interstate transportation of stolen property. Defense counsel did not object to the PSR’s treatment of defendant’s previous thefts and frauds as relevant conduct for sentencing purposes. The Sixth Circuit held that the district court did not commit plain error in treating defendant’s prior offenses as relevant conduct. His criminal history included 10 instances of failure to return rental property, two instances of outright theft, and two instances of bounced checks. Even if defendant could establish error, he could not show, as required by U.S. v. Olano, 507 U.S. 725 (1993), that the forfeited error seriously affected the fairness or integrity of the judicial proceeding. The relevant conduct, while not a mirror image of the offense of conviction, shared many of its traits. U.S. v. Koeberlein 161 F.3d 946 (6th Cir. 1998).
6th Circuit rejects physical restraint increase and upward departure where torture was not relevant to offense. (175) Defendant and his co-conspirators in a drug operation tortured a man they believed had stolen from them. One co-conspirator tortured the victim, defendant held the victim down and the other co-conspirator guarded the door. Defendant ultimately pled guilty to a single count of distributing crack cocaine. The Sixth Circuit rejected a § 3A1.3 enhancement for physically restraining the victim since the torture was not relevant conduct to the offense of conviction. Defendant’s distribution offense took place on December 28, 1994. The torture took place February 8 of the following year. None of the provisions of § 1B1.3 applied to the torture. The court also remanded to determine whether there was a sufficient connection between the offense of conviction and the torture to support an upward departure under § 5K2.2. Although district courts may consider more than “relevant conduct” in deciding whether to depart, a court may not base an upward departure on conduct that is completely unrelated to the offense of conviction. U.S. v. Cross, 121 F.3d 234 (6th Cir. 1997).
6th Circuit finds acquitted theft was not proved sufficiently to include it in loss. (175) Defendant, a postal employee, repeatedly stole articles from registered parcels. The stolen items included jewelry and five $5,000 bearer bonds. In calculating the loss, the district court included jewelry in an acquitted count. The Sixth Circuit held that the government did not sufficiently prove defendant committed the acquitted conduct to hold him responsible for it at sentencing. A court may consider relevant acquitted conduct at sentencing if it has been proved by a preponderance of the evidence. But here the only evidence linking defendant to the stolen jewelry in the acquitted count was the fact that defendant stole jewelry on other occasions. This was insufficient by itself. U.S. v. Comer, 93 F.3d 1271 (6th Cir. 1996).
6th Circuit rejects restitution based in part on uncharged and acquitted conduct. (175) Defendant, a postal employee, repeatedly stole articles from registered parcels. The district court ordered restitution of $142,108.38, which included losses related to an acquitted count and more than $10,000 relating to losses from uncharged conduct. The Sixth Circuit reversed, since restitution may not be ordered under the VWPA for losses caused by uncharged and acquitted conduct. The VWPA only authorizes restitution for losses caused by the conduct underlying the offense of conviction. U.S. v. Comer, 93 F.3d 1271 (6th Cir. 1996).
6th Circuit upholds use of relevant conduct to determine loss from loans to fictitious customers. (175) Defendant, a bank officer, made loans to fictitious customers and then used the proceeds for his own use. Virtually all of the loans were written off by the unsuspecting bank as a bad debt. He argued that the loss should be limited to the four counts to which he pled guilty. The Sixth Circuit upheld the use of relevant conduct to determine the loss. All of the fraudulent loans were clearly part of the same course of conduct. U.S. v. Berridge, 74 F.3d 113 (6th Cir. 1996).
6th Circuit uses acquitted conduct to decide whether there was more than minimal planning. (175) Defendant, a used car dealer, submitted fraudulent paperwork to a bank and bribed a bank officer to approve dubious automobile loans. He was convicted of two counts of making false statements to a bank, and was acquitted of eight counts of making false statements. He argued that the district court improperly considered acquitted counts in determining that his offense involved more than minimal planning. The Sixth Circuit found no error. The judge believed that the jury had given defendant the benefit of the doubt in acquitting him of eight of the counts, and the judge disagreed with this conclusion. The two false statement counts occurred over a seven month period. The judge could properly find that two instances of overt falsifications over seven months, combined with ample evidence of eight other instances of misrepresentations over the same period of time, was more than minimal planning. U.S. v. Spears, 49 F.3d 1136 (6th Cir. 1995), abrogated on other grounds by U.S. v. Wells, 519 U.S. 482, 117 S.Ct. 921 (1997).
6th Circuit upholds consideration of acquitted conduct. (175) Defendant argued that the district court erroneously based his sentence on conduct for which he had been acquitted. The 6th Circuit found no error, since circuit precedent clearly allows district courts to consider acquitted conduct at sentencing. The court declined to adopt the 9th Circuit’s reasoning in U.S. v. Brady, 928 F.2d 844 (9th Cir. 1991). U.S. v. Milton, 27 F.3d 203 (6th Cir. 1994).
6th Circuit uses pre-guidelines and pre- statute of limitations conduct as relevant conduct. (175) Defendant was convicted of income tax evasion for the years 1985 through 1990. The district court used the amount of unpaid taxes for the years 1981 through 1990 to determine tax loss under § 2T1.1. The 6th Circuit upheld the use of the tax loss from the uncharged conduct. The criminal conduct here was clearly part of the same course of conduct and therefore could be counted under § 1B1.3. The use of pre-guidelines conduct as relevant conduct did not violate the ex post facto clause or the guidelines themselves. In addition, conduct that cannot be prosecuted under the applicable statute of limitations can be used to determine relevant conduct, since even “acquitted” conduct may be so used. U.S. v. Pierce, 17 F.3d 146 (6th Cir. 1994).
6th Circuit upholds consideration of uncharged frauds in determining loss. (175) Defendant was part of a multi-state check writing conspiracy; however, his indictment only charged him with his activities in Iowa. Nonetheless, the 6th Circuit held that it was proper to include the uncharged acts in the amount of loss under §2F1.1(b)(1). The activities occurring in the other states were part of the same course of conduct as the Iowa scheme. Although the plea agreement stated that the relevant conduct was limited to the defendant’s Iowa activities, a plea agreement entered into between the government and the defendant is not binding on the court. U.S. v. Velez, 1 F.3d 386 (6th Cir. 1993).
6th Circuit says acquitted conduct can be considered in determining role in offense. (175) The 6th Circuit, relying on U.S. v. Moreno, 933 F.2d 362 (6th Cir.), affirmed that acquitted conduct could be considered in determining role in offense under section 3B1.1. U.S. v. August, 984 F.2d 705 (6th Cir. 1993).
6th Circuit upholds consideration of conduct outside dates set forth in indictment. (175) Defendant asserted that the district court erred in considering as relevant defendant’s conduct outside the specific dates of the conspiracy as set forth in his plea agreement, which dates were the same as those set forth in an amended superceding indictment. The 6th Circuit summarily rejected this argument, noting that it had previously held that conduct beyond that alleged in the indictment may be considered as long as there is a minimum indication of its reliability. U.S. v. Herrera, 928 F.2d 769 (6th Cir. 1991).
7th Circuit upholds increase for theft that benefitted foreign government despite acquittal of economic espionage. (175) Defendant, a former Motorola software engineer, was convicted of theft of trade secrets after she downloaded thousands of internal Motorola documents, all stamped proprietary, disclosing details of its cellular phone technology. She was stopped by Customs agents at the airport, headed to China. The trial judge acquitted her of economic espionage, although he stated that he thought her guilty of the offense, but ruled it had not been proved beyond a reasonable doubt. Nevertheless, the judge applied a two-level sentencing enhancement under § 2B1.1(b)(5), which applies “if the offense involved misappropriation of a trade secret and the defendant knew or intended that the offense would benefit a foreign government, foreign instrumentality, or foreign agent.” The Seventh Circuit upheld the increase. A judge need only determine relevant conduct by a preponderance of the evidence in order to use that conduct at sentencing. U.S. v. Hanjuan Jin, 733 F.3d 718 (7th Cir. 2013).
7th Circuit bases tax loss on other tax returns that featured same pattern of deception. (175) Defendant, the owner and operator of a tax preparation business, was convicted of 14 counts of willfully aiding and assisting in the preparation of fraudulent tax returns. The evidence demonstrated a pattern of defendant conjuring up nonexistent charitable contributions, job expenses, and medical expenditures. Defendant argued that the district court should only hold her accountable for the $31,849 in tax loss proven at trial. The Seventh Circuit upheld the court’s finding of a tax loss between $400,000 and $1 million. The PSR identified 662 returns audited by the IRS and prepared by defendant that featured materially false and fraudulent information similar to the fourteen returns at trial. The district court did not clearly err in finding that this evidence supported a pattern of deception attributable to defendant. By excluding from the group of 662 returns all cases where the taxpayer contested their audit, or where no additional tax was due, the government proved by a preponderance of the evidence that the remaining returns reflected defendant’s relevant conduct. U.S. v. Littrice, 666 F.3d 1053 (7th Cir. 2012).
7th Circuit upholds consideration of acquitted conduct at sentencing. (175) Defendant was convicted of being a felon in possession of a firearm, in violation of 18 U.S.C. § 922(g)(1). He was acquitted of several other drug-related offenses, but the district court took the underlying acquitted conduct into consideration at sentencing. The result was a statutory maximum sentence of 120 months. The Seventh Circuit rejected defendant’s argument that the consideration of acquitted conduct at sentencing was unconstitutional. The Supreme Court, in U.S. v. Watts, 519 U.S. 148 (1997), rejected that argument, stressing that a person whose acquitted conduct is considered at sentencing is not punished for that conduct. Rather, the person is punished for the crime of conviction, but in considering the characteristics of the offense, the court can consider relevant conduct proved by a preponderance of evidence, including acquitted conduct. Watts was not overturned by Apprendi and is binding on the lower courts. U.S. v. Waltower, 643 F.3d 572 (7th Cir. 2011).
7th Circuit reverses for lack of evidence that dismissed transactions were relevant conduct. (175) Defendant, a real estate agent, was convicted of multiple counts of wire fraud for her role in several real estate transactions. The Seventh Circuit held that the district court erred in considering transactions underlying dismissed counts as relevant conduct. To constitute relevant conduct, those acts must have been both attributable to defendant and part of a common scheme with the counts of conviction. Here, nine of the 14 counts were dismissed at trial before any evidence was presented and no evidence regarding defendant’s participation in these transactions was presented at sentencing. Given the lack of evidence and the lack of any explicit adoption of a PSR containing an adequate relevant conduct analysis, the district court erred in considering the transactions underlying the dismissed counts as relevant conduct. U.S. v. Locke, 643 F.3d 235 (7th Cir. 2011).
7th Circuit approves increase for discharge of firearm despite acquittal on similar charge. (175) Defendant served as the getaway driver for her boyfriend while he robbed a bank. He discharged his gun during the robbery. A jury convicted defendant of bank robbery, but found her not guilty of discharging a firearm. Nonetheless, the district court applied a seven-level enhancement for discharge of a firearm, and the Seventh Circuit affirmed. It is well-settled that a sentencing court may consider conduct of which a defendant has been acquitted when sentencing. While the government must prove guilt beyond a reasonable doubt to the jury, it need only show the conduct by a preponderance of the evidence at sentencing. A co-conspirator’s reasonably foreseeable actions can be attributed to a defendant for the purposes of sentencing. Here, taking all of the evidence of events leading up to the robbery, the robbery itself, the escape phase, and the materials later found in the van, including a second loaded handgun, the district court was reasonable in concluding that the co-defendant’s firing of the gun could be attributed to defendant as an aider and abettor. U.S. v. Quintero, 618 F.3d 746 (7th Cir. 2010).
7th Circuit considers uncharged child pornography as relevant conduct. (175) Defendant was convicted of receiving child pornography from a prepubescent twelve-year-old girl with whom he had a sexual relationship. At sentencing the court considered a video and photograph depicting other girls as relevant conduct to support enhancements under § 2G2.2(b)(2) and (7)(B). On appeal, the Seventh Circuit affirmed, holding that the video and photograph were sufficiently related to the child pornography underlying the offense of conviction to be considered relevant conduct and to justify the enhancements. U.S. v. Nance, 611 F.3d 409 (7th Cir. 2010).
7th Circuit reverses for failure to make finding as to scope of jointly undertaken activity. (175) Three defendants pled guilty to an Internet fraud scheme. The issue was whether defendants could reasonably foresee the conduct of other co-defendants for purposes of the loss amount and number of victims as relevant conduct under § 1B1.3(a)(1)(B). The district court made findings as to the reasonable foreseeability of the co-schemers’ acts only; it made no finding as to the scope of the jointly undertaken criminal activity. The government contended that no express finding was necessary because the court considered the defendants’ PSRs, which contained great detail about the nature of the criminal activity that defendants agreed to jointly undertake. The Seventh Circuit disagreed, because the court adopted the PSR’s findings by simply checking a box on a preprinted form, and in any event, the PSR made no findings as to the scope of the jointly undertaken criminal activity. U.S. v. Salem, 597 F.3d 877 (7th Cir. 2010).
7th Circuit includes in intended loss, the image of a million dollar check on defendant’s computer. (175) Defendant pled guilty to charges relating to his possession and use of unauthorized credit cards. The Seventh Circuit upheld the district court’s decision to include in the intended loss calculation a $1,000,000 check found on defendant’s home computer. Although defendant argued throughout that he never intended to print or cash this check, the district court was under no obligation to accept defendant’s word for this. The district court found that given defendant’s conduct and the possibility of negotiating a check of that size in other countries, the check was not produced as a joke, but with the hope that at some point it could be printed out and negotiated. U.S. v. Pira, 535 F.3d 724 (7th Cir. 2008).
7th Circuit allows consideration of dismissed firearm conduct in setting sentence. (175) The district court sentenced defendant to 18 months for his firearm conviction, in the middle of his 15-21 month guideline range. Defendant argued that the court penalized him because he sold the gun to Eller in front of an elementary school. Defendant was originally charged with possessing a firearm near a school zone, 18 U.S.C. § 922, a charge that was later dismissed. The fact that the charge was dismissed did not erase the facts surrounding the sale. Defendant admitted the facts in the PSR, which detailed the sale. As such, defendant’s proximity to the school was a part of the “nature and circumstances of the offense” that the district court was obligated to consider under 18 U.S.C. § 3553(a)(1). It did not render the resulting sentence unreasonable. The panel also rejected defendant’s claim that the court improperly weighed the § 3553(a) factors. The court noted defendant’s family situation and explicitly stated that it was taking into account the difficulty of raising a child alone. U.S. v. Haskins, 511 F.3d 688 (7th Cir. 2007).
7th Circuit allows consideration of dismissed firearm conduct in setting sentence. (175) The district court sentenced defendant to 18 months for his firearm conviction, in the middle of his 15-21 month guideline range. Defendant argued that the court penalized him because he sold the gun to Eller in front of an elementary school. Defendant was originally charged with possessing a firearm near a school zone, 18 U.S.C. § 922, a charge that was later dismissed. The fact that the charge was dismissed did not erase the facts surrounding the sale. Defendant admitted the facts in the PSR, which detailed the sale. As such, defendant’s proximity to the school was a part of the “nature and circumstances of the offense” that the district court was obligated to consider under 18 U.S.C. § 3553(a)(1). It did not render the resulting sentence unreasonable. The panel also rejected defendant’s claim that the court improperly weighed the § 3553(a) factors. The court noted defendant’s family situation and explicitly stated that it was taking into account the difficulty of raising a child alone. U.S. v. Haskins, 511 F.3d 688 (7th Cir. 2007).
7th Circuit affirms that court can still consider acquitted conduct post-Booker. (175) The Seventh Circuit ordered a limited remand to the district court under U.S. v. Paladino, 401 F.3d 471 (7th Cir. 2005). The district court found for sentencing purposes that one defendant was a member of the conspiracy despite the fact that jury acquitted him on the conspiracy charge. In U.S. v. Watts, 519 U.S. 148 (1997) the Supreme Court held that a court is permitted to consider a broad range of information for sentencing purposes, including conduct related to charges of which the defendant was acquitted. The Seventh Circuit joined all of other circuits that have confronted the issue in holding that the Supreme Court’s holding in Watts remains the law after Booker. See, e.g. U.S. v. Magallanez, 408 F.3d 672 (10th Cir. 2005). U.S. v. Price, 418 F.3d 771 (7th Cir. 2005).
7th Circuit holds that court erred in holding defendant accountable for full amount of fraud loss. (175) Defendant was involved in an investment fraud and money laundering conspiracy. He challenged the district court’s decision to hold him accountable for the entire scam loss amount. There was no evidence that pointed to defendant entering the conspiracy at its outset in 1994. The evidence showed only that he entered the conspiracy at some point, and that was not sufficient to hold him liable for the entire loss. The fact that defendant was convicted of participating in the conspiracy was not a finding of precisely when he joined. The Seventh Circuit remanded and ordered resentencing in accordance with U.S. v. Booker, 543 U.S. 220 (2005). U.S. v. Turner, 400 F.3d 491 (7th Cir. 2005).
7th Circuit reverses where shooting was not relevant conduct in escape. (175) Defendant was arrested after he ran from a crack house with a handgun. He was taken to a police station, where he escaped. A week later, while still on the lam, he was involved in a shooting and was arrested later that day hiding under a bed where officers found nine zip-lock bags of crack cocaine. He pled guilty to being a drug user in possession of a firearm and escape, in return for dismissal of the shooting and crack cocaine charges arising out of the later incidents. At sentencing, the judge found that the later incidents were “relevant conduct” for the escape and the original firearms charge and used the cross-reference in § 2K2.1(a) to sentence defendant under the attempted murder guideline § 2A2.1. On appeal, the Seventh Circuit reversed, holding that the shooting was not relevant conduct for the escape and in any event, the guideline for escape does not include a cross-reference which would allow sentencing on the basis of attempted murder. There was “no principled way to bridge the gap between the firearms charge and the shooting.” The shooting was not part of an attempt to escape detection, nor was defendant trying to silence someone who was planning to inform the authorities of his whereabouts. In fact, as defendant pointed out, the shooting simply called attention to defendant, and he was quickly apprehended after he pulled the trigger. U.S. v. Taylor, 272 F.3d 980 (7th Cir. 2001).
7th Circuit upholds money laundering increase based on conduct underlying acquitted counts. (175) Defendant was convicted of fraud and money laundering counts. The district court held defendant accountable for laundering more than $10 million, even though defendant was acquitted of this conduct, and the counts of conviction involved only $75,000. The Seventh Circuit found an adequate evidentiary basis for holding defendant accountable for the acquitted conduct. Relevant conduct includes all acts, including jointly undertaken criminal endeavors, “that were part of the same course of conduct or common scheme or plan as the offense of conviction.” § 1B1.3(a)(2). The district court recognized this when, after it initially denied the nine-level increase, it found that defendant “had a hand in” the more than $10 million that was laundered through the various transactions. U.S. v. Polichemi, 201 F.3d 858 (7th Cir. 2000).
7th Circuit agrees that acquitted conduct was proven by a preponderance of the evidence. (175) Defendants were convicted of conspiracy to participate in mail fraud, but were acquitted of the federal crime of arson. However, the district court found by a preponderance of the evidence that defendants had committed arson, and used the arson as relevant conduct for sentencing purposes. The Seventh Circuit found sufficient evidence to support the court’s finding that defendants committed the arson. Defendants did not challenge any evidence presented by the government, arguing only that the government’s evidence should not outweigh their own. The government’s evidence included the testimony of at least three witnesses, each of whom told a consistent story, as well as physical evidence such as defendant’s possessions, predating the fire, that they had stored with their family to preserve them. In addition, tape recordings by one of defendant’s brothers captured admissions made by defendants about the nature of the fire. U.S. v. Kroledge, 201 F.3d 900 (7th Cir. 2000).
7th Circuit says use of acquitted conduct did not merit higher standard of proof. (175) Defendants were convicted of a mail fraud conspiracy, but were acquitted of the federal crime of arson. However, the district court found by a preponderance of the evidence that defendants had committed arson, and used the arson as relevant conduct for sentencing purposes. Defendant argued that a heightened standard of proof applies “where a factual finding will result in a sentencing increase so great ‘that the sentencing hearing can fairly be characterized as a tail which wags the dog of the substantive offense.’” See U.S. v. Kikumura, 918 F.3d 1084 (3d Cir. 1990). The Seventh Circuit held that the use of acquitted here conduct did not require a higher standard of proof. Although a higher standard might be appropriate where the government appeared to use the sentencing hearing to retry the substantive offense, this was not such a case. If defendants had been convicted of the federal arson charge, they would each serve between five and 20 years. Instead, by enhancing their sentences based on the relevant conduct of arson, each defendant was serving either 27 or 33 months, roughly half of the minimum sentence they would have received for the arson charge. U.S. v. Kroledge, 201 F.3d 900 (7th Cir. 2000).
7th Circuit holds runner accountable for all losses from telemarketing scheme. (175) Defendant was one of several “runners” in Illinois who collected money wired to them by victims of a telemarketing scheme operating in Atlanta. Defendant argued that in holding him accountable for all the losses caused by the scheme, the district court looked at foreseeability, but failed to recognize that his participation in the conspiracy was limited to being a runner in the transactions he actually handled. The Seventh Circuit ruled that all the losses were within the scope of defendant’s agreement. Defendant was closely linked with the ringleaders of the scam, two of whom were lifelong friends. Defendant’s activities spanned more than two years. He went along with another runner on some of the latter’s pick-ups, which evidenced at least minimal cooperation among the runners. Defendant’s use of aliases to wire money exhibited an understanding of the scope of the offense and the roles of the various actors. Finally, his agreement to serve as a runner was essential to the success of the scheme and furthered the criminal activity of the group as a whole. U.S. v. Thomas, 199 F.3d 950 (7th Cir. 1999).
7th Circuit holds that bank president’s illegal transactions were part of common scheme. (175) Defendant, the president of a credit union, pled guilty to charges stemming from her creation of a fictitious loan to cover up the existence of an account with a negative balance. She argued that the district court erred by including irrelevant transactions in the loss caused by her conduct. The Seventh Circuit disagreed, holding that the contested financial transactions fell within both §§ 1B1.3(a)(1) and 1B1.3(a)(2). Although defendant pled guilty to a single count of falsifying the credit union’s books, she also (1) created fictitious loans and falsified loan documents to conceal the credit union’s declining financial status; (2) surreptitiously applied for, and directed proceeds of, life insurance proceeds she knew the credit union had issued without knowledge of the impropriety; and (3) misapplied credit union funds by waiving fees and making disbursements to friends and family. All of the transactions had factors common to the offense of conviction and demonstrated a “common scheme or plan.” The transactions had a common victim (the credit union), a common purpose (concealing the credit union’s declining financial condition), and a common modus operandi (manipulating credit union funds). U.S. v. Brierton, 165 F.3d 1133 (7th Cir. 1999).
7th Circuit holds that receipt of bribes in previous job was relevant conduct. (175) From 1990 to 1994, defendant was the police chief of a suburb of Chicago. During his tenure, he accepted $500 a month from organized crime to protect illegal gambling in the town’s bars and restaurant. Between 1980 and 1990, defendant had been police chief of another suburb. During this previous job he also took bribes from organized crime to protect illegal gambling in that town. He was convicted of charges stemming from the 1990-1994 bribes. The Seventh Circuit agreed that defendant’s receipt of bribes in his previous job was “relevant conduct” under § 1B1.3(a)(2). All the crimes were committed pursuant to a single plan and involved cooperation with the same organized crime operation by protecting illegal gambling from police interference. U.S. v. Sapoznik, 161 F.3d 1117 (7th Cir. 1998).
7th Circuit holds firearm possessed within six to nine months of current offense was relevant conduct. (175) A jury convicted defendant of being a felon in possession of a firearm based on two weapons police found in his house in early 1997. The district court applied a § 2K2.1(b) (1)(a) enhancement because the offense involved three firearms. The finding of three weapons was based on an earlier transaction in which defendant had received a semi-automatic assault rifle from another man and traded it to a drug-dealing partner for some marijuana. The Seventh Circuit found adequate evidence to support the district court’s finding that defendant’s possession of the rifle was relevant conduct. The district court concluded, based on the testimony of the man who transferred the gun to defendant that the transfer occurred after 1993. The court further found that defendant later traded the assault rifle to a drug dealer partner for illegal drugs. Defendant admitted that he did not get involved in drug dealing until the summer of 1996. Thus, the court found that defendant possessed the assault rifle sometime in the last half of 1996, within six to nine months of his arrest for possession of the other two weapons. U.S. v. Santoro, 159 F.3d 318 (7th Cir. 1998).
7th Circuit finds activities of stolen property ring were part of common scheme or plan. (175) Defendant and his three sons ran a theft ring. On three separate occasions, undercover agents or cooperating witnesses posing as dealers in stolen goods had dealings with the ring involving the sale of Vehicle Identification Numbers and auto titles. The Seventh Circuit upheld the district court’s finding that the activities of the theft ring amounted to a common scheme or plan under § 1B1.3. The fact that various activities could have been separately charged did not bar them from being treated as relevant conduct. The guidelines require that district court take into account the full range of related conduct, whether charged or not. The court’s finding of a common scheme or plan was adequate. The court found three common factors: common accomplices in defendant’s family members, common purpose of financial gain, and similar modus operandi of stealing and reselling merchandise with defendant consistently acting as the fence. U.S. v. Petty, 132 F.3d 373 (7th Cir. 1997).
7th Circuit considers relevant conduct that occurred in foreign country. (175) While working in Honduras, defendant made a number of films depicting minors engaged in sexually explicit conduct. He had the films developed in the U.S. and delivered to him in the U.S. Defendant pled guilty to receiving and possessing child pornography. The guidelines that applied to the offenses of conviction, §§ 2G2.2 and 2G2.4, contain a cross-reference to § 2G2.1, the guideline that applies to the production of child pornography. Defendant argued that the cross-reference did not apply because the conduct on which it was based, the production of the films, took place outside the U.S. The Seventh Circuit held that nothing barred the consideration of relevant conduct that occurred outside the U.S. Defendant was not being sentenced for his conduct in Honduras, producing child pornography. The offense of conviction—receiving and possessing child pornography—occurred entirely in the U.S. This holding is not inconsistent with Second Circuit cases excluding “foreign crimes” from relevant conduct. Those cases involved relevant conduct that had a tenuous link to the offense of conviction. Here, defendant’s exploitation of minors in Honduras created the very pornography that he received and possessed in the U.S. U.S. v. Dawn, 129 F.3d 878 (7th Cir. 1997).
7th Circuit includes tax loss from years that fell outside statute of limitations. (175) Defendant, a carpentry subcontractor, structured his finances and his business to prevent the IRS from learning about his income. He did not have a bank account and paid cash for everything, including his employees. He was convicted of tax evasion for the years 1988 to 1991. The Seventh Circuit upheld the district court’s consideration of defendant’s gross income for tax years 1986 and 1987 as relevant conduct, even though those years fell outside the statute of limitations. The Seventh Circuit, along with six other circuits, have held that the statute of limitations does not limit what a court may consider as relevant conduct. U.S. v. Valenti, 121 F.3d 327 (7th Cir. 1997).
7th Circuit holds seller who defrauded buyer also accountable for fraud against supplier. (175) In selling her oil business, defendant misrepresented to the buyer that several liens on the property had been paid in full. At the time of the sale, the company also owed $40,928.83 to its supplier for oil delivered before the sale. Defendant’s company had paid for the oil with checks on accounts with insufficient funds. The oil had already been delivered to the company’s customers at the time of the sale. The Seventh Circuit agreed that the loss to the supplier was relevant conduct that was properly included in the § 2F1.1 loss calculation. The loss was properly attributable to defendant, rather than the company’s manager. Defendant was fully aware of and involved in running the oil business, and she directed the actions of the manager and the company’s bookkeeper. Although the company may have received payments from its customers for some of the oil, defendant did not deposit them into the company’s account. It was not necessary for defendant to personally take all the amounts owed to the supplier for it to be counted toward the loss. U.S. v. O’Brien, 119 F.3d 523 (7th Cir. 1997).
7th Circuit finds sadomasochistic magazines relevant to child pornography offense. (175) Defendant was caught in a government sting operation after ordering and receiving by mail a videotape featuring child pornography. After his arrest, police found at his home pornographic magazines featuring young boys engaged in sadistic and masochistic acts. Defendant challenged a § 2G2.2(b)(3) enhancement for material portraying sadistic or masochistic conduct, since the videotape involved in the offense of conviction did not portray sadomasochism. The Seventh Circuit held that the § 2G2.2(b)(3) enhancement was properly based on relevant conduct. Section 1B1.3 provides that unless otherwise specified, specific offense characteristics are determined on the basis of relevant conduct. Defendant’s possession of the magazines was not too remote to be considered relevant conduct. He possessed them at the same time he received the videotape. Both defendant’s receipt and his possession of child pornographic materials violated the same criminal statute and indicated his dangerous propensities in the realm of sexual exploitation. U.S. v. Ellison, 113 F.3d 77 (7th Cir. 1997).
7th Circuit says previous fraud using same worthless stock was not relevant conduct. (175) In 1989, defendant attempted to obtain a $300,000 loan from a brokerage firm using worthless stock as collateral. The district court added to the loss the amount which one defendant had bilked from some purchasers of the same worthless stock in 1987. The Seventh Circuit held this was error because the previous fraud was not relevant conduct. The use of the same instrument of crime on separate occasions involving different victims does not establish relevant conduct under the guidelines. There was no more a common scheme or the same course of conduct than if defendant had used the same gun to hold up two different people two years apart. The error was harmless since defendant was still held accountable for loss of between $200,000 and $500,000. U.S. v. Coffman, 94 F.3d 330 (7th Cir. 1996).
7th Circuit holds that robberies and burglaries were not relevant conduct for money laundering. (175) Defendant made his living by stealing others’ property, selling it, and laundering the proceeds. He pled guilty to money laundering. Section 4A1.2(e)(1) directs a court to include in a defendant’s criminal history certain sentences that were imposed within 15 years of defendant’s “commencement of the instant offense.” This is defined to include any relevant conduct. The district court included in defendant’s criminal history a 1974 conviction that occurred within 15 years of the burglaries and thefts, even though the money laundering did not occur until after the expiration of the 15‑year window. The Seventh Circuit held that the robberies and burglaries were not relevant conduct for the money laundering offenses. The illegal conduct that furnishes the money that is later involved in a structuring transaction is not part of the structuring offense itself. Only when the effort to conceal the financial transaction begins does the relevant conduct for money laundering begin. Since the thefts and burglaries were not relevant conduct, the district court should not have included the 1974 sentence in defendant’s criminal history. U.S. v. Gabel, 85 F.3d 1217 (7th Cir. 1996).
7th Circuit agrees that losses caused by other conspirator were reasonably foreseeable. (175) Defendants operated sham businesses that obtained credit and other personal information which they used to fraudulently obtain credit cards, bank loans and checking accounts. The district court determined that one defendant’s fraudulent procurement of certain bank loans constituted relevant conduct for purposes of determining the second defendant’s offense level, and held the second defendant accountable for the loss. The Seventh Circuit affirmed, agreeing that the first defendant’s fraudulent bank loans were reasonably foreseeable acts performed in furtherance of their jointly undertaken criminal activity. The guidelines do not require that the second defendant have been aware of each and every action committed by the first defendant. The second defendant knew that the first defendant was purchasing properties, and knew that his activities would help the first defendant accomplish that objective. U.S. v. Akindele, 84 F.3d 948 (7th Cir. 1996).
7th Circuit considers RICO murder despite acquittal or hung jury on murder counts. (175) Defendants, members of the “Mob,” were convicted of RICO charges. They challenged the judge’s finding that their conduct included a conspiracy to commit murder, since the jury either acquitted or hung on the murder counts. The Seventh Circuit held that the judge’s consideration of the murder did not usurp the jury’s function. The jury was asked to decide whether there was proof beyond a reasonable doubt, whereas the preponderance of the evidence standard applied at sentencing. Although two members of the circuit have recently expressed support for using a clear and convincing evidence standard at sentencing to justify a markedly higher sentence that the facts found at trial, that was not the view of the majority of the judges. U.S. v. DiDomenico, 78 F.3d 294 (7th Cir. 1996).
7th Circuit agrees that money found in car upon arrest was relevant to money laundering. (175) Defendant made several deliveries of large sums of cash to an undercover agent posing as a money launderer. The cash was usually transferred in detergent boxes that had been emptied, filled with bills, and resealed. The boxes were usually left in the trunk of defendant’s car. When defendant was arrested, an additional $131,000 in cash was discovered inside emptied boxes of laundry detergent in the trunk of defendant’s car. The Seventh Circuit agreed that the money found in defendant’s car upon his arrest was properly included in the total amount laundered under § 2S1.1(b)(2). Defendant and the agent had an ongoing relationship, and the $131,000 was packaged in the same way and in the same place as previous deliveries. Also, there was evidence that defendant and the agent may have been getting together later that same day. U.S. v. Berrio, 77 F.3d 206 (7th Cir. 1996).
7th Circuit upholds firearm enhancement despite acquittal on firearms charges. (175) Defendant was convicted of drug charges and acquitted of carrying a firearm during a drug trafficking offense and being a felon in possession of a firearm. He argued that his firearms acquittals precluded the district court from enhancing his sentence under § 2D1.1(b)(1) for possessing a firearm during a drug trafficking offense. The 7th Circuit held that the firearms acquittals did not preclude the § 2D1.1(b)(1) enhancement. An acquittal does not mean a defendant did not do it; it merely means the prosecution did not establish guilt beyond a reasonable doubt. The enhancement need only be supported by a preponderance of the evidence. U.S. v. Jones, 54 F.3d 1285 (7th Cir. 1995).
7th Circuit holds defendant accountable for all stolen checks cashed by conspiracy. (175) Defendant argued that he was not responsible for all losses caused by a stolen check conspiracy because he did not join it at the beginning and was acquitted of or not charged with other counts of the indictment. The Seventh Circuit found that defendant was accountable for all of the stolen checks successfully deposited by the group. Defendant was involved from the beginning of the conspiracy as one of two people with whom the leader discussed cashing a $1.2 million stolen check. Although the check was returned because of its large sum, defendant told the leader to “look out for him” at the inception of the scheme, indicating his willingness and agreement to join the scheme. Thus, although defendant may not have actually participated when the group cashed its first three stolen checks, those checks were within the scope of the conspiracy and reasonably foreseeable to defendant. U.S. v. Dillard, 43 F.3d 299 (7th Cir. 1994).
7th Circuit uses dismissed counts to determine fraud loss. (175) Defendant argued that conduct underlying a dismissed count should not be used to determine loss under § 2F1.1. The 7th Circuit held that the dismissed count was properly considered as relevant conduct. Note 6 to § 2F1.1 states that the cumulative loss produced by a common scheme or plan or course of conduct should be used in determining the offense level, regardless of the number of counts of conviction. U.S. v. Martinson, 37 F.3d 353 (7th Cir. 1994).
7th Circuit holds threat was not “in connection with” silencer despite contemporaneous possession. (175) Defendant threatened a 14-year-old mentally retarded girl with a silencer-equipped gun, warning that he would harm “a lot of people” if she reported his sexual abuse. Defendant was convicted in federal court of possessing two unregistered silencers, and firearms charges were dropped. Section 2K2.1(c)(2) provides that where the defendant used or possessed the firearm “in connection with” another offense, the court is to cross reference § 2X1.1 to establish the base offense level. The 7th Circuit held that defendant did not possess the silencer “in connection with” the threat. Since the silencer alone could not cause injury, and did not look like a weapon, it could not have been used in connection with the threat. The relevant conduct guideline, § 1B1.3, also did not support the cross reference. Although defendant’s threats were contemporaneous with the silencer possession, and under a literal reading of § 1B1.3(a)(1) might be considered relevant conduct, such a construction would lead to “untenable” results. U.S. v. Ritsema, 31 F.3d 559 (7th Cir. 1994).
7th Circuit finds defendant was responsible for later disbursements in scheme. (175) Defendant was involved in a complicated scheme that permitted telemarketers, through the use of intermediaries, to gain access to credit card funds. He argued that he was “expelled” from the conspiracy in April 1991 and that disbursements made to him after this date were not relevant conduct. The 7th Circuit rejected this claim. Defendant remained an active and influential leader and beneficiary of the scheme after April 1991. He accepted wire transfers from three merchant accounts generated by a co-conspirator. U.S. v. Brown, 31 F.3d 484 (7th Cir. 1994).
7th Circuit approves reliance on drugs in acquitted conduct. (175) Defendant was convicted of selling cocaine to an undercover agent, but was acquitted of charges stemming from an incident where a deputy saw defendant run and drop a packet of 5.6 grams of cocaine. Defendant argued that the drugs in the acquitted “throw-down” incident should not have been included as relevant conduct. The 7th Circuit disagreed, approving the use of the drugs in the acquitted count. Nothing in the record suggested that the deputy’s testimony should not be believed. The testimony was corroborated by another witness. The testimonies were detailed and specific as to defendant’s actions. U.S. v. Porter, 23 F.3d 1274 (7th Cir. 1994).
7th Circuit holds false credit application was not relevant conduct to other fraudulent credit attempts. (175) In June 1988, defendant obtained credit to purchase furniture using a false name and social security number. In February 1989, she applied for a credit card using the same false name and social security number. In December 1989, she obtained a loan using a slightly different name and the same false social security number. In February 1991, defendant applied for a car loan using a new false name and another false social security number. She pled guilty to the June 1988 offense. The 7th Circuit reversed the district court’s determination that the February 1991 offense was relevant conduct for the June 1988 offense. The lengthy time interval tended to indicate conduct that could be separated into discrete units, rather than behavior that was part of the same course of conduct or common scheme or plan. Moreover, the acts were not sufficiently repetitive to call the conduct “regular.” U.S. v. Sykes, 7 F.3d 1331 (7th Cir. 1993).
7th Circuit focuses on conviction offense in extortion case. (175) Defendant was convicted of collecting a loan by extortionate means. The 7th Circuit held that the appropriateness of adjusting defendant’s sentence for role in the offense turned on how many persons participated in defendant’s offense of conviction, not in the defendant’s larger scheme to collect other loans by extortionate means. Though the court noted that a 1990 amendment to the commentary to 3B1.1 sought to reverse previous constructions of that guideline as focusing solely on the offense of conviction, the court viewed that amendment as making no difference on the facts of the case. Other acts that are part of the same course of conduct are included as relevant conduct under 1B1.3(a)(2) only when the offenses would be grouped under 3D1.2(d). Since defendant’s offense did not fit that category, 1B1.3(a)(1) dictated consideration of only defendant’s offense of conviction and acts occurring in preparation for that offense. Factual similarity does not constitute “preparation” for an offense. U.S. v. Tai, 994 F.2d 1204 (7th Cir. 1993).
7th Circuit rejects need for conspiracy count in calculating relevant conduct. (175) In calculating defendant’s drug quantity, the district court included marijuana that defendant’s co-conspirator was negotiating to purchase. Defendant argued that this was improper because he had not been charged with conspiracy. The 7th Circuit rejected the argument, noting that section 1B1.3 does not include such a requirement. U.S. v. Crawford, 991 F.2d 1328 (7th Cir. 1993).
7th Circuit upholds restitution based on fraud scheme broader than offense of conviction. (175) Defendant was originally charged with 35 counts of fraud as a result of his involvement in a scheme to defraud 120 investors through the operation of an commodity brokerage company. He pled guilty to two counts of fraud. These counts, although incorporating by reference the general fraudulent scheme outlined in Count One, specifically targeted only one investor. The 7th Circuit affirmed a restitution order based on the amount by which defendant had benefited from the entire scheme. Under Hughey v. U.S., 495 U.S. 411 (1990), the VWPA limits restitution to the loss caused by the specific conduct that is the basis of the offense of conviction. However, proof of a scheme is an element of the offense of mail fraud, and actions pursuant to that scheme should be considered conduct that is the basis of the offense of conviction. U.S. v. Turino, 978 F.2d 315 (7th Cir. 1992).
7th Circuit affirms firearm enhancement despite dismissal of gun counts. (175) The 7th Circuit rejected defendant’s claim that because the government voluntarily dismissed two gun counts against him, a firearm enhancement under section 2D1.1(b)(1) was improper. Defendant misunderstood the difference between a charged offense and a sentence enhancement under the guidelines. The government dismissed the firearm counts based upon its evaluation of the charges and did not promise not to seek enhancement. Under the guidelines, an enhancement is proper if the weapon was present during a drug trafficking offense, unless is it clearly improbable that the weapon was connected to the offense. Here, police found a .38 caliber revolver and a .9 millimeter pistol when they seized one-half a kilogram of cocaine from defendant’s home. The .38 was loaded when seized and the .9 millimeter was found with two partially loaded clips lying nearby. Defendant was unable to offer any evidence that the connection between the guns and his cocaine sales was clearly improbable. The type and location of the seized guns suggested that they were used in connection with defendant’s drug business. U.S. v. Nunez, 958 F.2d 196 (7th Cir. 1992).
7th Circuit upholds firearms enhancement despite acquittal on firearms charge. (175) The 7th Circuit affirmed an enhancement under section 2D1.1(b) for possession of a firearm during a drug trafficking crime even though defendant was acquitted of possessing the weapon during a drug trafficking crime. The fact that the jury did not find him guilty beyond a reasonable doubt did not prevent the court from finding the facts under the guidelines by a preponderance of the evidence. The court rejected defendant’s contention that his possession was analogous to an unloaded hunting rifle in the closet for which an enhancement is improper under application note 3 to section 2D1.1(b). Although there was testimony that defendant used the gun for private purposes such as shooting pigeons, the district court found that the semi-automatic pistol and loaded clip found in defendant’s van were readily accessible and available to defendant during the cocaine transaction which took place in the van. U.S. v. Welch, 945 F.2d 1378 (7th Cir. 1991).
7th Circuit upholds sentencing defendant on the basis of uncharged conduct. (175) Defendant lied to a grand jury concerning his relationship with a college football player. When he was brought before the grand jury to correct his misstatements, he lied again and produced false documents to support his falsehoods. Defendant pled guilty to one count of perjury, and received an upward adjustment for obstruction of justice. Defendant argued that since the indictment only alleged he impeded the investigation of his relationship with the football player, it was improper to make an upward adjustment based upon his impeding the perjury investigation. The 7th Circuit rejected this argument, noting that the guidelines specifically allow a court to calculate a sentence based on conduct that is not charged, but that relates to the same course of conduct — “so long as the evidence . . . is sufficiently reliable.” U.S. v. Leuddeke, 908 F.2d 230 (7th Cir. 1990).
8th Circuit upholds preponderance standard for use of uncharged relevant conduct. (175) Defendant was convicted of fraud and sentenced to 120 months. He argued on appeal that the district court erred by applying a preponderance of the evidence standard in determining his relevant conduct for purposes of sentencing enhancements. The Eighth Circuit affirmed, ruling that the fact that the uncharged relevant conduct could have been the basis for independent criminal charges did not require a higher standard. Defendant was not being sentenced for those uncharged crimes. According to U.S. v. Watts, 519 U.S. 148 (1997), “[s]entencing enhancements do not punish a defendant for crimes of which he was not convicted, but rather increase his sentence because of the manner in which he committed the crime of conviction.” U.S. v. Mustafa, 695 F.3d 860 (8th Cir. 2012).
8th Circuit says defendants could be held responsible for losses caused by co-conspirator. (175) Defendants were involved in a check counterfeiting scheme. The district court found that defendants acted in concert and therefore each could be held responsible for the losses caused by the other. The Eighth Circuit affirmed, finding defendants’ actions met the definition of jointly undertaken criminal activity. Defendants planned and carried out a scheme to achieve the unlawful end of possessing and passing counterfeit checks and possessing false identification. They traveled together to a state revenue office with the intent of obtaining identifications as part of the larger scheme of using those identifications to pass counterfeit checks. The two were photographed passing counterfeit checks at about the same time at different cash registers within the same Wal-Mart. There was evidence that they had been traveling together for at least two months prior to their arrest. Further, the two men shared resources to carry out their scheme when the both used the same apartment and van to carry out their criminal enterprise. U.S. v. Harvey, 413 F.3d 850 (8th Cir. 2005).
8th Circuit holds that unfulfilled leases with other victims constituted relevant conduct. (175) Defendant operated an aircraft leasing company. On one occasion, the company accepted a $400,00 deposit from Access Air for the leases on two planes, but never delivered the jets and never refunded the money. During its seven years of operation, the defendant’s company never actually leased any aircraft. The district court concluded that the unfulfilled leases with the other carriers constituted relevant conduct under § 1B1.3, and the Eighth Circuit affirmed. The district court’s finding of defendant’s relevant conduct was entirely consistent with holdings in similar cases. Defendant used his company as the common business front from which to solicit his victims. Each case was premised on the company securing a lease for a transport grade aircraft. Further, defendant executed substantially similar documents in setting up each separate fraudulent transactions. The four acts occurred within months of each other. Defendant operated the scheme with the same accomplice. Defendant’s dealings were part of the same common plan or scheme. Thus, defendant’s sentence was reasonable. U.S. v. Killgo, 397 F.3d 628 (8th Cir. 2005).
8th Circuit holds that firearm possessed in connection with earlier robbery was relevant to instant conspiracy. (175) In March 1998, defendant and Abney robbed a credit union and attempted to rob the Radcliffe bank. Later, defendant attempted to recruit Olscewski for a second attempt to rob the Radcliffe bank. Olscewski was an informant, and defendant was arrested. Defendant admitted that he had purchased a shotgun to use in the credit union robbery. Moreover, part of defendant’s plan for robbing the Radcliffe bank was to brandish the shotgun. Defendant pled guilty to the credit union robbery. Upon his release from prison, he and Kirk conspired on a third attempt to rob the Radcliffe bank, but the attempt was unsuccessful. Later, defendant and Kirk successfully robbed the First American bank. Defendant was convicted of the First American robbery and charges related to the aborted Radcliffe bank robbery, including a conspiracy charge that dated back to his aborted attempt to rob the bank with Abney and Olscewski. The district court found that defendant’s possession of the shotgun before his conviction for the credit union robbery was conduct relevant to the Radcliffe bank charges because defendant (1) intended to use the gun in his second attempt to rob the Radcliffe bank, and (2) used it to try to recruit Olscewski as a co-conspirator. The Eighth Circuit agreed that possession of the shotgun was relevant conduct to the conspiracy to rob the Radcliffe bank. The dates of the conspiracy were from March 1998 until November 10, 1999. Defendant committed several acts in furtherance of the conspiracy that predated his first conviction and clearly related to the conspiracy to rob the Radcliffe bank. U.S. v. Regenwether, 300 F.3d 967 (8th Cir. 2002).
8th Circuit holds that losses to other investors was relevant conduct. (175) Defendant was charged with a conspiracy involving his sale of unregistered promissory notes issued by his company, Global Productions. He diverted the money generated by these sales and never used it for Global’s business purposes. In addition, defendant borrowed money from Cowden promising that it would be used to further the business of Global, and he took money from the Wardens purportedly to buy stock in Global, and gave them a handwritten note promising repayment. In both cases, he diverted the money to other uses. The Eighth Circuit held that the losses to Cowden and the Wardens constituted relevant conduct that could be included in the § 2F1.1 loss calculation. Defendant’s dealings with Cowden and the Wardens bore a strong resemblance to the sale of unregistered promissory notes with which the indictment charged defendant. In all of these transactions, defendant used Global Productions as an investment lure, and a promise of repayment to convince his victims to give him money, and then diverted the money rather than devoting it to the purposes he originally proposed. The transactions shared a common purpose, and a similar modus operandi, and so could be deemed part of a common scheme or plan. U.S. v. Bush, 252 F.3d 959 (8th Cir. 2001).
8th Circuit holds that Iowa investment fraud scheme was relevant conduct to charged investment fraud. (175) Defendant and a co-conspirator were involved in two investment fraud schemes, one in Iowa and the other in New York. Although defendant was only charged and convicted of the conduct involved in the New York scheme, the district court held him accountable at sentencing for losses stemming from the Iowa scheme. The Eighth Circuit affirmed, agreeing that defendant’s actions in Iowa were “part of the same course of conduct or common scheme or plan as the offense of conviction.” § 1B1.3(a)(2). Defendant told both Iowa investors that they could pool their money to “trigger a line of credit” to purchase annuities, which would then be resold at a profit. This claim was identical to the ones made to the investors involved in the indicted offense. In addition, defendant’s actions in Iowa and the charged offense involved the same modus operandi: either defendant or one of his accomplices was responsible for the withdrawal and wire transfer of investor funds to unauthorized accounts. Moreover, both in Iowa and in the charged offense, either defendant or an accomplice secured the services of well-respected and unsuspecting businesses to aid in the scheme. U.S. v. Howard, 235 F.3d 366 (8th Cir. 2000).
8th Circuit rules 1980 investment was not relevant conduct to 1993 fraud scheme. (175) In 1993, defendant solicited $1,540,000 from Minnesota investors to produce an electric car, and then converted the money for his own use. In calculating the § 2F1.1 loss, the district court took into account an additional $1,549,000 that different investors lost to defendant in other electric-car investments from as early as 1975. The Eighth Circuit reversed the loss calculation since at least one of the earlier investments was not relevant conduct. The offense of conviction, as defined in the indictment, was the 1993 fraud. One of the claimants from the earlier fraud filed a forfeiture claim for $1,000,000 based upon a 1980 loan to a different electric car company. There was no evidence this transaction was related to the offense of conviction in any significant way. Thus, it was not relevant conduct as a matter of law. Reducing the $3,090,000 loss by this $1,000,000 reduced the total fraud loss to $2,090,000, which is in the same fraud loss category as the $1,540,000 loss that defendant conceded. See USSG § 2F1.1(b)(1)(M) (mandating 12-level increase for loss of more than $1,500,000 but less than $2,500,000). U.S. v. Ramirez, 196 F.3d 895 (8th Cir. 1999).
8th Circuit rules that thefts from clients were relevant conduct to lawyer’s insider trading scheme. (175) Defendant, a senior partner in a large law firm, bought stock in a company in which a client was contemplating making a tender offer. When the tender offer was announced, he realized a profit of over $4 million. He used the profits to conceal his previous embezzlements and conversions of clients’ trust funds. Section 2F1.2, the insider trading guideline, calls for enhancement based on the “gain resulting from the offense.” The district court found the gain exceeded $5 million by adding the $4.2 in gain from the stock transaction to the $1.9 million defendant had stolen from his clients. Defendant argued that the $1.9 million he stole from his clients (which had resulted in eight state court convictions) should not have been included. The Eighth Circuit suggested that defendant might be estopped from raising this claim because he had successfully argued that his state crimes were part of his federal conduct, which precluded them from being counted in his criminal history and allowed him to receive 23 months’ credit for time served for the state crimes. Nonetheless, even on the merits, the court found no error in including the state thefts from the clients in the relevant conduct. U.S. v. O’Hagan, 139 F.3d 641 (8th Cir. 1998).
8th Circuit rejects need to explain how acquitted conduct was proven by a preponderance. (175) Defendants argued that U.S. v. Watts, 117 S.Ct. 633 (1997) obligates a court to make specific findings detailing precisely how acquitted conduct relied on at sentencing has been proven by a preponderance of the evidence. The Eighth Circuit disagreed. Watts holds only that a sentencing court may consider conduct underlying an acquitted charge, if that conduct has been proven by a preponderance. The case does not even require a court to state that its findings are supported by a preponderance of the evidence, much less provide a detailed account of all of the facts that underlie these findings. It is sufficient if the court makes the factual findings necessary to support the relevant sentencing adjustments. U.S. v. Whatley, 133 F.3d 601 (8th Cir. 1998).
8th Circuit says sales before defendant joined conspiracy were not relevant conduct. (175) Defendant fraudulently induced several people to invest in his company of which he was president by misrepresenting that their investments were guaranteed by an escrow fund. The trial court found that the conspiracy ran from December 1992 to December 1993, and although defendant was not hired until July 1993, he was liable for all the stock sold during the conspiracy. The Eighth Circuit disagreed. When defendant was hired in July, he knew of the stock sales previously made by company officers and could reasonably foresee future sales. He also knew that the summary sheet being presented to investors misrepresented that an escrow fund existed. As of mid-July 1993, defendant at least tacitly agreed to the use of that summary sheet in future stock sales. However, there was insufficient evidence that defendant joined the conspiracy before he was hired. Thus, the sales that occurred before defendant was hired were not relevant conduct. U.S. v. Cain, 128 F.3d 1249 (8th Cir. 1997).
8th Circuit uses relevant conduct for bodily injury enhancement. (175) Defendant was convicted of two counts of aggravated assault with a dangerous weapon. He challenged an enhancement under § 2A2.2(b)(3)(A) for bodily injury, contending that his victim’s injuries were not caused by the dangerous weapons, but by his fists and feet. The Eighth Circuit held that the relevant conduct was properly considered in applying the bodily injury enhancement. The victim sustained a large cut on her right forearm, bruises on her face and chin, a swollen nose, scraped knees and shins, bruising on her shoulder, face and shin areas, lacerations on her forearm, and a hairline rib fracture. These injuries occurred during defendant’s nearly continuous assault on the victim. The district court was not required to assign the use of a specific dangerous weapon to a particular resulting injury. U.S. v. LeCompte, 108 F.3d 948 (8th Cir. 1997).
8th Circuit agrees that defendant continued his fraudulent conduct while on release. (175) Defendant sold franchises by misrepresenting what the buyers would receive for their money and by exaggerating the amount of money the buyers would be able to make through operating the franchises. After defendant was indicted and while he was out on bond, he sold more franchises under a different name. The court considered the post-indictment business dealings as relevant conduct, thus increasing defendant’s offense level, taking away his acceptance of responsibility reduction, and assessing more points for obstruction of justice. Defendant argued that while on bond he operated his business lawfully and was no longer making misrepresentations to potential clients. The Eighth Circuit held that the evidence supported the district court’s conclusion that defendant continued his fraudulent conduct while on release. The evidence was conflicting on whether the software he sold clients actually worked as promised. However, there was no clear error in the court’s conclusion that defendant continued his past pattern of selling franchise packages that the franchisees were not able to use as promised. U.S. v. Choate, 101 F.3d 562 (8th Cir. 1996).
8th Circuit holds that reliance on relevant conduct did not breach plea agreement. (175) Defendant established four companies that collected health insurance premiums but failed to provide the insurance. Under his plea agreement, defendant pled guilty only to one count of mail fraud, but the district court relied on the loss from the entire scheme as relevant conduct in setting his base offense level. Defendant contended that this violated his plea agreement. In the agreement, the government stipulated that it would not prosecute defendant for offenses which were related to or arose out of the operation of the four companies. The Eighth Circuit held that the consideration of relevant conduct did not breach the plea agreement. Defendant stipulated that the offenses to which he pled guilty were “subject to” the sentencing guidelines. Section 1B1.3 of the guidelines requires that all relevant conduct be considered, regardless of the number of counts of conviction. Moreover, a sentencing court is not bound by stipulations in the plea agreement in “determining the facts relevant to sentencing.” U.S. v. Allen, 75 F.3d 439 (8th Cir. 1996).
8th Circuit holds that truck thefts were relevant conduct to insurance fraud scheme. (175) Defendant falsely reported to his insurance company that his truck had been stolen. The truck was recovered by police on the farm of defendant’s friend. Police also recovered from the farm four other trucks that various dealers had reported stolen. The district court included the value of the four stolen trucks in the loss calculation under § 2F1.1. The 8th Circuit agreed that the truck thefts were part of the same course of conduct as defendant’s insurance fraud scheme. Defendant switched parts from the stolen trucks with parts from his own truck in order to disguise his truck and allow him to continue to use it. Stealing and using the parts from the others trucks was integral to defendant’s concealment and continuing use of his truck. Senior Judge Heaney dissented, believing the majority “stretched the concept of ‘relevant conduct’ beyond the breaking point.” U.S. v. Ballew, 40 F.3d 936 (8th Cir. 1994).
8th Circuit agrees that losses from other frauds were part of same course of conduct. (175) After defendant’s checking accounts were closed, the bank’s president allowed defendant to continue to write checks on the closed accounts. The checks were cleared by drawing on defendant’s line of credit. To reduce the amount outstanding before a bank audit, defendant deposited in the line of credit insufficient funds checks written on another bank account. The president credited the line of credit before the checks were presented to the second bank for payment. Defendant eventually pled guilty to a single bank fraud count relating to an insufficient funds check written on the second bank account. The district court included in the loss under section 2F1.1 the checks written on the closed accounts, loan agreements defendant signed with the bank president, and the collateral pledged by defendant to cover those accounts. The 8th Circuit affirmed that this was all “relevant conduct” under section 1B1.3, and properly included in calculating the loss. Senior Judge Heaney dissented. U.S. v. Sheahan, 31 F.3d 595 (8th Cir. 1994).
8th Circuit, despite acquittal, upholds enhancement for discharging hazardous substance. (175) Defendant was convicted of illegally transporting and storing hazardous waste. He argued that it was improper to enhance his sentence under § 2Q1.2(b)(1)(B) for discharging a hazardous substance because the jury acquitted him of this. The 8th Circuit held that defendant’s acquittal did not preclude the enhancement, given the different standards of proof. It was undisputed that the drums were leaking. Even assuming that actual environmental contamination was required, the enhancement was proper. Because the waste was volatile, the air carried the waste’s organic compound. Also, the drums were leaking onto the floor, which had a floor drain that led to a storm sewer that led to a creek. U.S. v. Freeman, 30 F.3d 1040 (8th Cir. 1994).
8th Circuit considers transfer of funds as relevant conduct for misapplication. (175) Defendant, a bank vice president, misapplied bank funds by improperly debiting one customer’s line of credit, and improperly crediting that amount to the loan accounts of two other bank customers, one of which was his father. In another series of transactions, defendant transferred $104,000 from his father’s checking account to his own personal account. The 8th Circuit agreed that transfer of the $104,000 was relevant conduct to the misapplying bank funds count. Defendant conducted a series of misleading withdrawals from his father’s account at the same time he was misapplying bank funds. He falsified bank records in both offenses in much the same manner. U.S. v. Hulshof, 23 F.3d 1470 (8th Cir 1994).
8th Circuit considers drugs in counts for which defendant was not convicted. (175) Defendant was convicted of a drug conspiracy and one substantive count, was acquitted of two other counts, and the jury was undecided on the remaining nine substantive counts. She argued that her sentence should have been determined only by considering the amount of cocaine involved in the substantive count for which she was convicted. The 8th Circuit rejected this claim. The amounts of cocaine for which defendant could be held responsible need not have been proven beyond a reasonable doubt. Therefore, the trial court could have considered drug quantities involved in the counts that did not result in conviction because they were part of the conspiracy. U.S. v. Finch, 16 F.3d 228 (8th Cir. 1994).
8th Circuit considers dismissed count in applying sexual abuse cross-reference. (175) Defendant pled guilty to one count of receiving a photograph of a minor engaging in sexually explicit conduct, and the count charging production of the photograph was dismissed. The guideline for receipt of child pornography, section 2G2.2, provides a cross-reference to section 2G2.1 if the offense caused a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of that conduct. The district court found that defendant took the photographs, and applied the cross-reference. The 8th Circuit upheld consideration of the dismissed count. Defendant took the photographs in order to receive them. Section 1B1.3(a)(iii)(1) makes the cross-reference applicable to all acts committed during, in preparation for, or in furtherance of the offense of conviction. Sentencing defendant based on conduct from the dismissed count did not deprive him of the benefit of his plea bargain. U.S. v. Jones, 994 F.2d 456 (8th Cir. 1993).
8th Circuit affirms use of loss in dismissed counts as relevant conduct. (175) Defendant pled guilty to two counts of converting grain he had pledged as collateral for a federal farm loan. The 8th Circuit affirmed including the loss in the dismissed counts in calculating the loss under section 2B1.1. Defendant admitted that he had disposed of all of the grain for which he was initially charged. He also admitted that these actions were part of a continuing course of conduct he undertook to cover up for missing grain. The district court properly concluded that the loss in the dismissed counts constituted relevant conduct under section 1B1.3. U.S. v. Redlin, 983 F.2d 893 (8th Cir. 1993).
8th Circuit holds that losses from uncharged fraud should have been considered relevant conduct. (175) Defendant sold fraudulent promissory notes over interstate phone lines. He was charged with selling notes to three individuals, but he also defrauded two additional investors not listed in the charging information. The 8th Circuit held that two uncharged acts of fraud were relevant conduct to the offense of conviction, and thus the losses inflicted upon the two unlisted investors should have been included in the calculation of loss under section 2F1.1. The district court also incorrectly calculated the loss based on the net loss to each investor, i.e. the actual value of the fraudulent notes sold to the investors less the amount defendant repaid the investors. The amount of loss used to increase the offense level under the fraud guideline may be either the intended loss or the actual loss, whichever is greater. Here, the loss should be the amount of possible loss the defendant attempted to inflict upon his victims. U.S. v. Prendergast, 979 F.2d 1289 (8th Cir. 1992).
8th Circuit upholds consideration of uncharged conduct in pre-guidelines case. (175) In a pre-guidelines case, defendant contended that his sentence was excessive because the district court considered inappropriate and irrelevant information connecting him to other uncharged conduct. Specifically, defendant objected to the portion of the presentence report which indicated that he had provided cash to an unindicted co-conspirator for the purchase of cocaine in California. The 8th Circuit rejected this claim, since at sentencing a judge is given broad discretion as to the type of information he may consider. Defendant was given the opportunity to rebut and explain the information contained in the presentence report. An evidentiary hearing was held to address defendant’s numerous objections to the presentence report. Defendant’s 15-year sentence was not excessive because it fell within the statutory limits of 21 U.S.C. sections 841(b)(1)(B) and 846. U.S. v. Dunlop, 960 F.2d 55 (8th Cir. 1992).
8th Circuit upholds consideration of additional firearms distributed by defendant. (175) Defendant pled guilty to possession of an unregistered firearm. His offense level was increased under guideline § 2K2.2(b)(1)(B) based upon his distribution of six firearms. The 8th Circuit rejected defendant’s contention that this was improper since he was indicted for possessing only a single weapon. In drug cases, an appellate court may sentence on the basis of uncharged but relevant conduct to calculate offense levels. The amount of drugs and the relevancy of conduct are factual findings reversible only for clear error. The court found that the same rationale was applicable here. U.S. v. Dennis, 926 F.2d 768 (8th Cir. 1991).
8th Circuit upholds accumulating the value of all stolen goods and transactions for which codefendants were indicted. (175) Defendant was a participant in a stolen goods ring involving several other people. Defendant argued that it was improper to accumulate the value of all stolen goods and transactions for which his codefendants were indicted. The 8th Circuit rejected this contention, finding that guidelines § 1B1.3(a)(2) authorized the district court to consider amounts beyond those to which defendant pled guilty. Defendant relied upon the commentary to 1B1.3, which provides that in a robbery case in which a defendant robbed two banks, money taken in one robbery cannot be considered in determining the guidelines range for the other robbery. The 8th Circuit found defendant’s reliance to be misplaced, since robbery is not an offense to be grouped together under 3D1.2(a)(2). However, possession of stolen property is an offense grouped together. U.S. v. Russell, 913 F.2d 1288 (8th Cir. 1990).
8th Circuit upholds enhancement for use of a firearm in a robbery despite acquittal on gun charge. (175) Defendants were convicted of bank robbery and acquitted of using a firearm during a robbery. The bank robbery count alleged the use of a firearm. The sentencing court enhanced defendants’ sentence based on the use of a firearm and defendants appealed. The 8th Circuit affirmed the enhancement, holding that use of a firearm need only be proved by a “preponderance of the evidence” for sentence enhancement purposes. “Thus, the acquittal on count two does not undermine the fact that a preponderance of the evidence supported the conclusion that a firearm was used during the robbery.” U.S. v. Dawn, 897 F.2d 1444 (8th Cir. 1990).
8th Circuit holds that acts charged in dismissed counts may be used to establish the base offense level. (175) Defendant pled guilty to possession of an unregistered firearm and threatening to kill the Reverend Jesse Jackson during the 1988 presidential campaign. He argued on appeal that the District Court erred in enhancing his offense level under § 3C1.1 (obstruction of justice) due to his threatening the life of an informant, because that count was dismissed. The 8th Circuit rejected his challenge, finding that § 1B1.3 expressly provides for consideration of all “acts committed by the defendant . . . for which the defendant would otherwise be accountable.” Because the guidelines impliedly permit and do not expressly prohibit consideration of dismissed counts for sentencing purposes, the District Court did not err in considering the dismissed count. Because a proper factual basis existed, the court’s enhancement was proper. U.S. v. Williams, 879 F.2d 454 (8th Cir. 1989).
9th Circuit upholds use of uncharged conduct in determining sentence. (175) At defendant’s sentencing on fraud charges, the district court used uncharged fraudulent loans in determining defendant’s offense level. The Ninth Circuit held that the uncharged loans were part of a common scheme with the conduct of conviction because the uncharged loans and the charged loans involved a common victim, common accomplices, a common purpose, and a similar modus operandi. For that reason, the court held that the uncharged fraudulent loans constituted relevant conduct under § 1B1.3. U.S. v. Horob, 735 F.3d 866 (9th Cir. 2013).
9th Circuit reverses increase for unconvicted acts that were not relevant conduct. (175) The guideline for mailing a threatening communication, § 2A6.1(b)(4), requires a four-level enhancement in offense level if the defendant’s conduct resulted in substantial government expenditures. The district court imposed this enhancement based on conduct for which defendant was not convicted. Judge Clifton, joined by Judges Reinhardt and N.R. Smith, held that the district court erred because defendant’s acts were not relevant conduct under guideline § 1B1.3(a)(2) which provides that other acts may be considered part of the same “course of conduct or common scheme or plan” only if the other acts must be “grouped” with the conviction offense under guideline § 3D1.2(d). Here, the acts on which the enhancement was based would not have been grouped with the counts on which defendant was convicted, because they involved different victims and different acts. U.S. v. Keyser, 704 F.3d 631 (9th Cir. 2012).
9th Circuit reaffirms that Sixth Amendment does not bar use of acquitted conduct at sentencing. (175) Defendant argued that, in imposing his sentence, the district court relied on conduct underlying counts on which he had been acquitted. The Ninth Circuit found that defendant’s Sixth Amendment rights could not have been violated because defendant received a sentence below the statutory maximum, but held that even if the court relied on acquitted conduct, it had not violated the Sixth Amendment. U.S. v. Scott, 642 F.3d 791 (9th Cir. 2011).
9th Circuit reaffirms that acquitted conduct may be used at sentencing. (175) In U.S. v. Watts, 519 U.S. 148 (1997), the Supreme Court held that at sentencing, a district court could consider conduct by the defendant underlying charges on which he was acquitted. Defendants argued that U.S. v. Booker, 543 U.S. 220 (2005), undermined Watts and precluded the use of acquitted conduct in determining a defendant’s sentence. The Ninth Circuit rejected that argument and held that the use of acquitted conduct at sentencing does not violate the Sixth Amendment. U.S. v. Mercado, 474 F.3d 654 (9th Cir. 2007).
9th Circuit finds that “pattern of sexual activity” enhancement may rest on uncharged conduct. (175) Guideline § 1B1.2 limits relevant conduct to conduct occurring during the commission of the offense “unless otherwise specified.” Under § 2G2.2(b)(2), a court may enhance the sentence of a defendant convicted of a child pornography offense for a pattern of sexual activity involving the sexual exploitation of a minor. Relying on Application Note 1 to this guideline, the Ninth Circuit held that a court may rely on relevant conduct that did not underlie the commission of the offense of conviction to determine whether a defendant engaged in a pattern of sexual activity. On this basis, the district court properly relied on defendant’s sexual abuse of his granddaughter to enhance his offense level for the offense of transmitting child pornography. U.S. v. Williamson, 439 F.3d 1125 (9th Cir. 2006).
9th Circuit says that enhancement for minors rested on images underlying prepubescent defendant’s conviction. (175) Defendant was convicted of offenses involving child pornography based on his transmission of 19 child porn images to Croatia. At sentencing, the district court enhanced defendant’s sentence under § 2G2.2(b) (1) because the material at issue involved prepubescent children. On appeal, defendant claimed that the district court had imposed this enhancement based on images other than the 19 images for which he had been convicted. The Ninth Circuit rejected this contention and held that the pictures that defendant had transmitted justified the enhancement. U.S. v. Williamson, 439 F.3d 1125 (9th Cir. 2006).
9th Circuit upholds use of cross-reference for sex crimes based on dismissed relevant conduct for which federal jurisdiction lacking. (175) Defendant pleaded guilty to Class C and Class D felonies involving child pornography and sexual abuse of a minor. In return for his plea, the government dismissed Class A felonies involving sexual abuse of a minor. At sentencing, the court applied the cross-reference in § 2G2.2(c)(1) on the basis of the dismissed conduct, including conduct that the federal government may have lacked jurisdiction to prosecute. As a result, defendant was sentenced under the guideline for the more serious felonies. The Ninth Circuit held that the court properly applied the cross-reference based on dismissed conduct, including conduct over which the district court lacked jurisdiction. U.S. v. Speelman, 431 F.3d 1226 (9th Cir. 2005).
9th Circuit reaffirms that conduct underlying a vacated conviction can be considered as relevant conduct. (175) In U.S. v. Newland, 116 F.3d 400, 404 (9th Cir. 1997), the Ninth Circuit held that a sentencing court is permitted to consider conduct involved in a reversed conviction. The court relied on U.S. v. Watts, 519 U.S. 148 (1997) which held that a sentencing court can consider conduct of which a defendant has been acquitted. Accordingly, in the present case, the Ninth Circuit upheld the district court’s consideration of five firearms in vacated counts to increase defendant’s sentence by three levels pursuant to guideline § 2K2.1(b)(1)(C). The district court found by a preponderance of the evidence that defendant actually possessed the firearms underlying the vacated convictions, noting that this was undisputed. U.S. v. Franklin, 235 F.3d 1165 (9th Cir. 2000).
9th Circuit requires “clear and convincing evidence” for fourteen level increase in fraud case. (175) Two defendants in this Ponzi scheme received a fourteen level upward adjustment on the basis of uncharged relevant conduct – even though each was convicted of only two fraudulent sales. This increased their sentencing ranges from 12-18 months to 41-51 months. Relying on its recent decisions in U.S. v. Mezas de Jesus, 217 F.3d 638, 643 (9th Cir. 1999), and U.S. v. Hopper, 177 F.3d 824, 829 (9th Cir. 1999), the Ninth Circuit held that this increase was sufficiently disproportionate to trigger the “clear and convincing evidence” burden of proof at sentencing. Since the court applied the preponderance standard, the sentence was reversed and remanded for new findings under this heightened standard of proof. U.S. v. Munoz, 233 F.3d 1117 (9th Cir. 2000).
9th Circuit requires “clear and convincing” evidence for 9-level kidnapping increase. (175) Defendant was convicted of being an undocumented immigrant in possession of a firearm, in violation of 18 U.S.C. § 922(g)(5). At sentencing, the government argued that defendant committed the offense during an uncharged kidnapping. The district court applied the preponderance of the evidence standard and increased defendant’s sentence by 9 levels for the uncharged kidnapping. On appeal, the Ninth Circuit reversed, relying on its recent decision in U.S. v. Hopper, 177 F.3d 824, 833 (9th Cir. 1999), which held that “clear and convincing evidence” was required before the defendant’s sentence could be increased by seven levels, based on violent activity for which he was acquitted. In Hopper, the 7-level adjustment increased the sentencing range from 24-30 months to 63-78 months. In the present case, the 9-level increase for the uncharged kidnapping increased the sentencing range from 21-27 months to 57-71 months, and the district court sentenced him to 57 months. The district court’s failure to apply the clear and convincing evidence standard required reversal. U.S. v. U.S. v. Mezas de Jesus, 217 F.3d 638 (9th Cir. 2000).
9th Circuit upholds sentencing for drugs in acquitted count. (175) Defendant was charged with bringing marijuana into the United States on two separate occasions in secret compartments of automobiles. The jury convicted him of one incident, but acquitted him of the other. Nevertheless, at sentencing, the district court found beyond a reasonable doubt that defendant knowingly imported marijuana on both occasions, and therefore included both amounts as relevant conduct under § 1B1.3. On appeal, the Ninth Circuit affirmed, noting that in U.S. v. Watts, 519 U.S. 148 (1997), the Supreme Court held that a sentencing court may consider facts underlying acquitted counts as relevant conduct as long as the conduct is proven by a preponderance of the evidence. The Ninth Circuit held that the district court’s factual finding – beyond a reasonable doubt – was not clearly erroneous. U.S. v. Castillo, 181 F.3d 1129 (9th Cir. 1999).
9th Circuit upholds increase based on violent activity of which defendants were acquitted. (175) In U.S. v. Watts, 519 U.S. 148, 157 (1997), the Supreme Court held that a “jury’s verdict of acquittal does not prevent the sentencing court from considering conduct underlying the acquitted charge, so long as that conduct has been proved by a preponderance of the evidence.” Thus, the district court could properly consider acquitted conduct in deciding to enhance the defendant’s sentence for violent conduct in this tax case, under § 2T1.9(b)(1). However, the Ninth Circuit held that the seven-level adjustment for one defendant required proof by “clear and convincing” evidence. U.S. v. Hopper, 177 F.3d 824 (9th Cir. 1999).
9th Circuit reaffirms that acquitted conduct may be used in sentencing. (175) In U.S. v. Watts, 117 S.Ct. 633 (1997), the Supreme Court held that a jury’s verdict of acquittal does not prevent the sentencing court from considering conduct underlying the acquitted charge, as long as that conduct has been proved by a preponderance of the evidence. The present case was a companion case to Watts, and on remand from the Supreme Court, the panel held that the district court did not clearly err in finding by a preponderance that the defendant was involved in the conduct underlying the count on which she was acquitted. Accordingly the district court properly considered that conduct in determining her offense level. Chief Judge Hug concurred specially to urge the Sentencing Commission to consider this issue of acquitted conduct. U.S. v. Putra, 110 F.3d 705 (9th Cir. 1997).
9th Circuit holds Koon allows judge to reject acquittal or guilty verdict at sentencing. (175) In U.S. v. Brady, 928 F.2d 844, 850-52 (9th Cir. 1991), the Ninth Circuit held that, at sentencing, a judge may not reconsider facts that were necessarily rejected by a jury’s acquittal on some counts. However, in Koon v. U.S., 518 U.S. 81, 116 S.Ct. 2035 (1996), the Supreme Court held that “for the courts to conclude a factor must not be considered under any circumstances would be to transgress the policymaking authority vested in the Commission.” Accordingly, the Ninth Circuit held that “the approach we took in Brady is overruled by the Supreme Court’s decision in Koon.” The panel adopted Judge Wallace’s dissent in U.S. v. Putra, 78 F.3d 1386, 1390-94 (9th Cir. 1996), bringing the Ninth Circuit into line with every other circuit in upholding the use of acquitted conduct at sentencing. In an interesting twist however, the court applied its new holding to permit a judge to reject a jury’s guilty verdict at sentencing. Thus, the court upheld a defendant’s eligibility for the “safety valve” under § 5C1.2, despite his claim of ignorance of the drugs he was carrying. U.S. v. Sherpa, 97 F.3d 1239 (9th Cir. 1996).
9th Circuit upholds increase for drug-related income in tax case despite acquittal. (175) The district court increased defendant’s sentence by two levels under § 2T1.3(b)(1) (Nov. 1992), finding that defendant received more than $10,000 in unreported income from narcotics trafficking. Defendant argued that this was error because the jury acquitted him on the drug counts, while convicting him on the tax counts. On appeal, the Ninth Circuit held that a conviction was not necessary for a “criminal activity” enhancement under the tax guideline. Although the sentence cannot be based upon facts “necessarily rejected” by the jury’s acquittal, the acquittal on the conspiracy charge did not mean that the jury “necessarily rejected” the conduct underlying that charge. The jury may simply have found insufficient evidence of an agreement. Applying the “preponderance of the evidence standard,” the court found ample evidence that defendant engaged in drug trafficking that could have generated over $10,000 of unreported income from “criminal activity” in a year. U.S. v. Karterman, 60 F.3d 576 (9th Cir. 1995).
9th Circuit sentences for all drugs in conspiracy despite acquittal on substantive counts. (175) Defendant was convicted of conspiracy but acquitted on substantive counts of possession with intent to distribute. He argued that the district court erred in finding that the 830 grams of cocaine found in the hotel room was within the scope of the conspiracy. The Ninth Circuit rejected the argument, relying on U.S. v. Diaz-Rosas, 13 F.3d 1305 (9th Cir.), cert. denied, 114 S.Ct 1848 (1994), which held that a sentence on a conspiracy charge may be based upon a quantity of narcotics for which the defendant was acquitted of possessing if the drugs were foreseeably within the scope of the conspiracy. In a footnote, the court distinguished U.S. v. Brady, 928 F.2d 844 (9th Cir. 1991), which held that a sentence may not be based on facts rejected by a jury’s acquittal. Unlike Brady, defendant’s sentence on the conspiracy count “was based on his participation in the conspiracy, not facts rejected by the jury.” U.S. v. Vgeri, 51 F.3d 876 (9th Cir. 1995).
9th Circuit reverses where sentence was analogized to count prosecutor agreed not to charge. (175) In exchange for defendant’s guilty plea to sexually abusing a minor, the government dismissed four other counts and agreed not to seek a superseding indictment charging aggravated sexual abuse. Although the Ninth Circuit generally forbids considering dismissed counts in sentencing, U.S. v. Castro-Cervantes, 927 F.2d 1079 (9th Cir. 1990), defendant agreed to waive that protection as to the conduct in the dismissed counts of sexual abuse. At sentencing, the district court analogized this conduct to aggravated sexual abuse, and the Ninth Circuit reversed, holding that this deprived defendant of the benefit of his bargain. On remand, the district court again based its sentence in part on an analogy to aggravated sexual abuse, and the Ninth Circuit reversed again. However, the court upheld several other grounds for departure, on which the district court could rely on remand. U.S. v. Chatlin, 51 F.3d 869 (9th Cir. 1995).
9th Circuit reverses firearm increase for lack of finding of “foreseeability” and acquittal. (175) The jury acquitted defendant of armed robbery, convicting him on the lesser-included offense of robbing a mail carrier. Nevertheless, the district court increased his sentence under guideline section 2B3.1(b)(2)(C) for brandishing a firearm during a robbery, reasoning that defendant was responsible under Pinkerton v. U.S., 328 U.S. 640 (1946) for the acts of his co-conspirators. The 9th Circuit reversed, stating that it was error to rely on Pinkerton because the test under the guidelines is whether it was “reasonably foreseeable” to defendant that his co-defendants would brandish a gun. In addition, the enhancement was improper here because, under U.S. v. Brady, 928 F.2d 844 (9th Cir. 1991), a defendant’s sentence may not be based on factual findings which a jury has necessarily rejected by its acquittal. U.S. v. Pinkney, 15 F.3d 825 (9th Cir. 1994).
9th Circuit upholds sentence for conduct on which jury failed to reach a verdict. (175) Defendant argued that it was improper for the district court to adjust his sentence upward for conduct on which the jury failed to reach a verdict. He relied on U.S. v. Brady, 928 F.2d 844 (9th Cir. 1991), which held that a court may not base a sentence on facts that have been rejected by a jury’s not guilty verdict. The 9th Circuit found no error, noting that the jury here did not acquit defendant, “it merely failed to reach a verdict.” The government introduced persuasive evidence that defendant had participated in the conduct on which the jury failed to agree. Therefore the district court was free to find these facts and base its sentence upon them despite the jury’s failure to reach a verdict. U.S. v. Duran, 15 F.3d 131 (9th Cir. 1994).
9th Circuit includes drug quantity in conspiracy despite acquittal of personal possession. (175) The jury convicted defendant of conspiracy and one count of possession but acquitted him of a second possession charge. Nevertheless, the 9th Circuit upheld sentencing him for the amount of cocaine in the second count. The court distinguished U.S. v. Brady, 928 F.2d 844 (9th Cir. 1991) noting that there was no inconsistency between the jury’s verdict and the district court’s finding that defendant was accountable for the cocaine seized in the second count. The district court made a specific finding that the three kilos seized in the second count were foreseeable to the defendant as part of the continuing conspiracy. Therefore, they were properly included as “relevant conduct” under guideline section 1B1.3. The court rejected defendant’s argument that the district court should have imposed a higher standard of proof, noting that the court’s finding was fully consistent with the jury’s verdict, despite the acquittal. U.S. v. Diaz-Rosas, 13 F.3d 1305 (9th Cir. 1994).
9th Circuit says sentence was based on amount of drugs in conspiracy rather than uncharged substantive crimes. (175) Defendant argued that the Commission exceeded its statutory authority in drafting 1B1.3(a)(2) by requiring sentencing based on uncharged crimes, citing U.S. v. Galloway, 943 F.2d 897 (8th Cir. 1991), reversed en banc 976 F.2d 414 (1992); U.S. v. Miller, 910 F.2d 1321, 1329-30 (6th Cir. 1990) (Merritt, J. dissenting). The 9th Circuit did not reach this issue because the defendants would obtain no relief even if the court were to adopt the holding of the original panel in Galloway. The defendants here were convicted of conspiracy to import and distribute marijuana and their sentences were based on an estimate of the total quantity of drugs imported pursuant to that conspiracy rather than on the basis of any uncharged, substantive crimes. See Pinkerton v. U.S., 328 U.S. 640 (1946). U.S. v. Conkins, 9 F.3d 1377 (9th Cir. 1993).
9th Circuit remands for findings as to which marijuana shipments were reasonably foreseeable. (175) Under Application Note 1 to section 1B1.3, the sentencing court may only sentence a defendant for relevant conduct that was reasonably foreseeable in the criminal activity the defendant agreed to undertake jointly. Here, defendants were involved in no more than three or four of the alleged twenty-six marijuana smuggling trips in the larger conspiracy. A finding that the scope of their agreement was limited to the trips they actually made could reduce the mandatory minimum sentence from ten to five years. The district court’s general and conclusory statements fell short of the specificity required by section 1B1.3. The case was remanded to the district court to determine by a preponderance of the evidence whether the scope of the defendants’ agreement to import and distribute marijuana extended beyond the shipments in which they were directly involved. U.S. v. Conkins, 9 F.3d 1377 (9th Cir. 1993).
9th Circuit rejects argument that “relevant conduct” guideline violates statutory mandate. (175) Defendant pled guilty to two counts of a multi-count bank fraud and false claims indictment. The plea agreement identified a total loss of $4.3 million from all of the indicted charges. However, defendant was sentenced based on $8.3 million, which included losses from crimes for which defendant was not indicted. In a 2-1 decision, the Ninth Circuit found that the sentence was properly based on the total losses in the scheme and rejected defendant’s argument that the “relevant conduct” provisions in §1B1.3 exceeded the Sentencing Commission’s statutory mandate. In so holding, the court concurred with the Eighth Circuit’s decision in U.S. v. Galloway, 976 F.2d 414 (8th Cir. 1992) (en banc) that 28 U.S.C. §994(c)(2) gave the Commission full authority to adopt a relevant conduct guideline. The dissent argued that the Commission exceeded its rule-making authority in promulgating the relevant conduct guideline. U.S. v. Wong, 2 F.3d 927 (9th Cir. 1993).
9th Circuit finds no breach of plea agreement where defendant stipulated to consideration of dismissed count. (175) Defendant argued that under U.S. v. Castro-Cervantes, 927 F.2d 1079 (9th Cir. 1990), it was error for the district court to accept the plea bargain by which he pled guilty to possession of an unregistered sawed off shotgun in violation of 26 U.S.C. 5861(d), and to dismiss the assault count, and yet take into account the assault when imposing sentence. The plea agreement provided that pursuant to guideline section 2K2.1(b)(5) “the defendant understands that the government will argue that the circumstances of the alleged assault should be considered by the judge as a specific offense characteristic for the purposes of sentencing the defendant on [the gun count]”. The 9th Circuit held that this language was explicit in stating that the government reserved the right to prove at sentencing that defendant had committed the assault. The pivotal point of the Castro-Cervantes case was that a plea bargain is governed by contract principles. No violation of the bargain occurred when the government proved the assault at sentencing. U.S. v. Shackley, 995 F.2d 166 (9th Cir. 1993).
9th Circuit reiterates that dismissed “groupable” counts can be considered. (175) In a case involving the harassment and intimidation of multiple interracial couples, defendant pled guilty to one count of mail fraud, one count of mailing a threatening communication and one count of threatening the President. Although the 9th Circuit found nothing to indicate the district court actually based the sentence on the conduct involving victims in dismissed mail fraud counts, it reiterated that dismissed “groupable” counts can be considered in sentencing. Mail fraud counts are “groupable” under the multiple count rules in §3D1.2. This was the holding in U.S. v. Fine, 975 F.2d 596 (9th Cir. 1992 (en banc). Therefore, even if the district court considered the overall fraudulent conduct or conduct against a specific victim in a dismissed count, it would have been proper to do so. U.S. v. McAninch, 994 F.2d 1380 (9th Cir. 1993)
9th Circuit finds court properly considered steroids in dismissed counts. (175) Defendant was convicted of introducing steroids in interstate commerce without a prescription. He argued the court should not have relied on conduct contained in dismissed counts in departing from the range established by U.S.S.G. 2N2.1. The 9th Circuit agreed that since the 2N2.1 offense level is not determined by the aggregate amount of harm (i.e., it is “non-groupable”), it was improper to consider the conduct in the dismissed counts in departing upward. However, the district court alternatively premised its decision on section 2F1.1 and did not err by considering the quantities of steroids involved in the dismissed counts as “relevant conduct.” In U.S. v. Fine, 975 F.2d 596 (9th Cir. 1992) (en banc) the court held that dismissed counts may be considered as relevant conduct in establishing a defendant’s offense level under section 2F1.1. Because the district court properly applied section 2F1.1, the 9th Circuit did not consider whether it should have applied the 1991 amended version of section 2D1.1 to calculate the sentence. U.S. v. Von Mitchell, 984 F.2d 338 (9th Cir. 1993).
9th Circuit calculates criminal history from date of relevant conduct, not just counts included in plea. (175) Defendant was convicted of student loan fraud and placed on probation on June 1, 1989. Thereafter, it was discovered that he had engaged in a second fraudulent scheme, which lasted from before his prior sentencing through October of 1989. He pled guilty to three counts involving acts that took place prior to June 1, 1989. Five later counts were dismissed. The district court increased his criminal history by three points under § 4A1.1(d)-(e) for committing the instant offense while on probation for another crime. On appeal, defendant pointed out that the three acts to which he pled guilty occurred before he was placed on probation for the other crime. Nevertheless, the 9th Circuit ruled the enhancement proper because the term “instant offense” under § 4A1.1(d)-(e) includes “relevant conduct” under § 1B1.3. The court rejected defendant’s argument that dismissed counts could not be considered as relevant conduct, relying on U.S. v. Fine, 975 F.2d 596 (9th Cir. 1992) (en banc). U.S. v. Smith, 991 F.2d 1468 (9th Cir. 1993).
9th Circuit includes uncharged loans as relevant conduct in fraud case. (175) Defendant was convicted of fraudulently obtaining two automobile loans and a home mortgage loan. The 9th Circuit held that the district court did not err by including in its calculation of loss under section 2F1.1(b)(1) losses attributable to counts the government agreed not to prosecute. There was no dispute that these losses arose out of a common scheme, and therefore they were “relevant conduct” under 1B1.3. The court found it unnecessary to decide whether it was proper to include losses attributable to dismissed counts because these losses did not change the offense level. The district court properly considered the entire fraudulent scheme, whether charged or not, in concluding that the defendant was involved in a scheme to defraud more than one victim. The two-level increase under section 2F1.1(b)(2)(B) (June 1988) was proper. U.S. v. Galliano, 977 F.2d 1350 (9th Cir. 1992).
9th Circuit, en banc, holds fraud losses underlying dismissed counts are relevant conduct. (175) The panel opinion in this case, U.S. v. Fine, 946 F.2d 650 (9th Cir. 1991) held that mail fraud losses underlying counts dismissed in a plea agreement could not be considered as “relevant conduct” under Section 1B1.3 of the Sentencing Guidelines. The Ninth Circuit granted rehearing en banc, and unanimously reversed the panel. The en banc court followed the earlier decision in U.S. v. Turner, 898 F.2d 705, 711 (9th Cir. 1990), which held that quantities of drugs in dismissed were properly aggregated with the counts of conviction as relevant conduct. The court distinguished U.S. v. Castro-Cervantes, 927 F.2d 1079 (9th Cir. 1990) and U.S. v. Faulkner, 952 F.2d 1066 (9th Cir. 1991), (9th Cir. 1991) on the ground that the dismissed (or uncharged) conduct there was used to depart. The en banc court left the remainder of the panel opinion intact. U.S. v. Fine, 975 F.2d 596 (9th Cir. 1992) (en banc).
9th Circuit upholds reliance on relevant conduct to sentence for all losses arising out of mail fraud scheme. (175) Defendant argued that his offense level should have been calculated by the amount of the check mailed in count one, i.e. $580, rather than the amount of the total scheme to defraud, $38,906. He contended that his stipulation that the total losses exceeded $120,000 could not bind him to a sentence unauthorized by law. The 9th Circuit rejected the argument, relying on the “relevant conduct” section of the guidelines, section 1B1.3, and the cases of U.S. v. Newbert, 952 F.2d 281, 283-84 (9th Cir. 1991) and U.S. v. Niven, 952 F.2d 289, 291 (9th Cir. 1991). The court said that because “there was no dispute that the losses associated with counts I and II arose out of a common scheme or plan, the district court was required to take into account all losses associated with both counts when determining the appropriate offense level under section 2F1.1(b). U.S. v. Scarano, 975 F.2d 580 (9th Cir. 1992).
9th Circuit reaffirms that uncharged conduct may not form the basis for a departure in plea cases. (175) In its original opinion in this case, the 9th Circuit held that it was bound by U.S. v. Castro-Cervantes, 927 F.2d 1079 (9th Cir. 1990) to hold that, where there is a plea agreement, the district court may not rely on uncharged bank robberies to depart upward from the sentencing guidelines. On December 24, 1991, the panel amended its opinion to add a footnote distinguishing U.S. v. Loveday, 922 F.2d 1411, 1417 (9th Cir. 1991), but leaving its original opinion intact. The court noted that the full court had been advised of the government’s suggestion for rehearing en banc and no judge of the court has requested a vote on it.” The petition for rehearing was denied. U.S. v. Faulkner, 952 F.2d 1066 (9th Cir. 1991).
9th Circuit upholds reliance on uncharged nonfederal relevant conduct in setting offense level. (175) Defendant pled guilty to two counts of making false statements for submitting false vouchers totaling $182. At sentencing the district court considered the entire amount of the false vouchers, $214,000, and increased his total offense level by one point for this “relevant conduct” under section 1B1.3(a)(2). On appeal, the 9th Circuit affirmed, holding that even nonfederal relevant conduct can fall within guideline section 1B1.3. In addition, the court relied on U.S. v. Mun, 928 F.2d 323 (9th Cir. 1991) to hold that even if defendant were prosecuted by the state for the nonfederal conduct, that would not bar subsequent sentencing by a federal court based on the same conduct, because the double jeopardy clause does not prevent dual prosecution by separate sovereigns. U.S. v. Newbert, 952 F.2d 281 (9th Cir. 1991).
9th Circuit holds that plea bargain prevents judge from considering dismissed or uncharged counts in sentencing. (175) Relying on its amended opinion in U.S. v. Castro-Cervantez, 927 F.2d 1079 (9th Cir. 1991), the 9th Circuit reiterated that under guideline § 6B1.2, “a district judge may not first accept a plea bargain and then consider dismissed charges in calculating defendant’s sentence.” The court also rejected the government’s argument that the sentence could be based on uncharged bank robberies. Although guideline § 1B1.4 permits a court to consider “any information” unless otherwise prohibited by law, the limitations imposed on departures by guidelines § 5K2.0 “also bar an upward departure on account of the eight [robberies] either not charged or dismissed as a result of the plea bargain.” U.S. v. Faulkner, 952 F.2d 1066 (9th Cir. 1991).
9th Circuit holds that plea bargain prevents judge from considering dismissed or uncharged counts in sentencing. (175) Relying on its amended opinion in U.S. v. Castro-Cervantez, 927 F.2d 1079 (9th Cir. 1991), the 9th Circuit reiterated that under guideline § 6B1.2, “a district judge may not first accept a plea bargain and then consider dismissed charges in calculating defendant’s sentence.” The court also rejected the government’s argument that the sentence could be based on uncharged bank robberies. Although guideline § 1B1.4 permits a court to consider “any information” unless otherwise prohibited by law, the limitations imposed on departures by guidelines § 5K2.0 “also bar an upward departure on account of the eight [robberies] either not charged or dismissed as a result of the plea bargain.” U.S. v. Faulkner, 952 F.2d 1066 (9th Cir. 1991).
9th Circuit upholds considering prior immigration felony dropped as part of plea bargain. (175) Defendants were charged with violating 8 U.S.C. § 1326(b)(1), reentry following deportation after a felony conviction. The maximum sentence for that crime is 5 years. They pled guilty to § 1326(a), simple reentry after deportation, which carries a two year maximum sentence. Nevertheless, the district court considered their prior felony convictions, increasing the base offense level by four points under § 2L1.2(b)(1). On appeal, the 9th Circuit held that a “prior felony conviction is an element of the crime with which appellants were charged, 8 U.S.C. § 1326(a), but is not an element of the crime to which they pleaded guilty, 8 U.S.C. § 1326(b)(1).” The court held that the “relevant conduct” section of the guidelines, 1B1.3(a)(4), required consideration of the prior convictions. The court rejected the argument that this violated the “spirit” of the plea bargains or that the government acted “dishonestly” in bargaining away the more serious offense. The government simply “bargained away the option to pick sentences above § 1326(a)’s two year maximum in exchange for appellant’s guilty pleas.” U.S. v. Arias-Granados, 941 F.2d 996 (9th Cir. 1991).
9th Circuit says court should not accept plea bargain and then later consider dismissed charges in sentencing. (175) The policy statement for guideline § 6B1.2(a) says that where a plea agreement includes the dismissal of any charges, the court may accept the agreement if it determines that the “remaining charges adequately reflect the seriousness of the actual offense behavior.” The 9th Circuit stated that the “plain implication of this section is that if the sentencing court believes that the remaining charges do not adequately reflect the seriousness of the defendant’s behavior, the court should not accept the plea agreement.” Accordingly the court held that “the sentencing court should reject a plea bargain that does not reflect the seriousness of the defendant’s behavior and should not accept a plea bargain and then later count dismissed charges in calculating the defendant’s sentence.” The court acknowledged that its holding was in conflict with two other circuits, U.S. v. Kim, 896 F.2d 678, 684 (2nd Cir. 1990), and U.S. v. Zamarripa, 905 F.2d 337, 341 (10th Cir. 1990), but said that its holding was “faithful not only to the guidelines but to the fundamental concept of plea bargaining.” “To let the defendant pled to certain charges and then be penalized on charges that have, by agreement, been dismissed is not only unfair; it violates the spirit if not the letter of the bargain.” U.S. v. Castro-Cervantes, 927 F.2d 1079 (9th Cir. 1990).
9th Circuit upholds departure based on “cache of weapons.” (175) Defendant objected to the district court’s use of information about his cache of weapons as a basis for departure because it was not specified in the information to which he pled guilty. Relying on § 1B1.3, which permits consideration of “relevant conduct,” and § 1B1.4, which permits a district court to consider “any information concerning the background, character, and conduct of the defendant unless otherwise prohibited by law,” the 9th Circuit upheld the district court’s consideration of the cache of weapons as a basis for departure. U.S. v. Nakagawa, 924 F.2d 800 (9th Cir. 1991).
9th Circuit holds that departure may be based on relevant conduct in addition to count of conviction. (175) Defendant argued that the upward departure was impermissible because it was based on additional counts for which he had not been convicted. Section 5K2.0 states that “harms identified as a possible basis for departure from the guidelines should be taken into account only when they are relevant to the offense of conviction, within the limitations set forth in § 1B1.3.” The 9th Circuit held that this permitted the trial court to consider defendant’s conduct in manufacturing other bombs which related to the bomb which was the offense of conviction. Accordingly the upward departure was proper. U.S. v. Loveday, 922 F.2d 1411 (9th Cir. 1991).
10th Circuit finds assault by co-conspirators was relevant conduct. (175) Members of a white separatist organization were convicted of charges stemming from two racially-motivated assaults in Salt Lake City. Two defendants who participated in the first assault, but not the second, challenged the district court’s finding that the second assault was relevant conduct, but the Tenth Circuit affirmed. Defendants were convicted of conspiracy to interfere with civil rights from December 2002 to March 2003. This established that defendants had an agreement to harm “non-white” persons. An assault against a “non-white” individual by co-conspirators is related to the conspiracy to injure and intimidate “non-whites.” Moreover, the second assault followed the same pattern as the first assault: in both instances, members of the conspiracy encountered a non–white person in a public place, lured the victim outside and then jointly assaulted him. Furthermore, defendants were in the company of the assailants earlier in the evening on the night of the second assault, and when the assailants told defendants what happened the following morning, one defendant responded “good job,” and the other laughed. U.S. v. Egbert, 562 F.3d 1092 (10th Cir. 2009).
10th Circuit applies § 2A6.1 even though defendant was acquitted of sending threatening letter. (175) Defendant was convicted of conspiracy to impede or injure an officer, 18 U.S.C. § 372, based on his involvement in sending a threatening letter to an assistant U.S. attorney who was prosecuting members of a white supremacy group. Defendant was acquitted of mailing a threatening communication, 18 U.S.C. § 876. The offense of conviction § 372, does not have an assigned Sentencing Guidelines section, so § 2X5.1 directed the court to apply “the most analogous offense guideline.” The Tenth Circuit held that § 2A6.1, which applies to threatening or harassing communications, was the most applicable guideline, rather than § 2A2.4, which applies to efforts to obstruct or impede officers or employees of the U.S. by force. Section 2A6.1 better captured the element of a letter seeking to threaten or intimidate a public official. While § 2A2.4 incorporates the fact that the victim was a governmental officer, and § 2A6.1 does not, the official victim enhancement, § 3A1.2, expressly applies to § 2A6.1 and not § 2A2.4. Although defendant was acquitted of mailing a threatening communication, this did not affect the “most analogous guideline” inquiry. U.S. v. Rakes, 510 F.3d 1280 (10th Cir. 2007).
10th Circuit rejects large departure/variance based on uncharged conduct that was not related to current offense. (175) The FBI began to investigate defendant after an adult dancer reported defendant had discussed with her in detail his desire to kidnap, rape and kill young girls. The FBI investigated defendant for several months. Although there was some evidence that he had approached a young girl in Wal-Mart, and had been interrupted by the girl’s mother, the FBI was unable to find any additional evidence in this regard. Therefore, it shifted the focus of its investigation to defendant’s illegal drug activity. He pled guilty to a single count of possession of methamphetamine with intent to distribute. Although his guideline range was 120-135 months, the district court sentenced defendant to 360 months, finding the advisory guideline range “vastly inadequate.” The Tenth Circuit reversed. The horrific sexual abuse and murder that defendant either contemplated or took steps toward committing were not relevant conduct because they were completely unrelated to his sale of meth. The court could not have departed under the guidelines on the basis of these facts. When a § 5K2.0 departure is based on acts of misconduct not resulting in conviction, those acts must still relate meaningfully to the offense of conviction. Section 4A1.3(a)(2) also was unavailing, because the uncharged conduct was not similar adult criminal conduct. Finally, in an exercise of Booker discretion, a sentencing court may not discard the advisory guideline range and impose a sentence based on evidence of the defendant’s uncharged, unrelated misconduct, whether actually committed or contemplated for the future. U.S. v. Allen, 488 F.3d 1244 (10th Cir. 2007).
10th Circuit applies § 2A6.1 even though defendant was acquitted of sending threatening letter. (175) Defendant was convicted of conspiracy to impede or injure an officer, 18 U.S.C. § 372, based on his involvement in sending a threatening letter to an assistant U.S. attorney who was prosecuting members of a white supremacy group. Defendant was acquitted of mailing a threatening communication, 18 U.S.C. § 876. The offense of conviction § 372, does not have an assigned Sentencing Guidelines section, so § 2X5.1 directed the court to apply “the most analogous offense guideline.” The Tenth Circuit held that § 2A6.1, which applies to threatening or harassing communications, was the most applicable guideline, rather than § 2A2.4, which applies to efforts to obstruct or impede officers or employees of the U.S. by force. Section 2A6.1 better captured the element of a letter seeking to threaten or intimidate a public official. While § 2A2.4 incorporates the fact that the victim was a governmental officer, and § 2A6.1 does not, the official victim enhancement, § 3A1.2, expressly applies to § 2A6.1 and not § 2A2.4. Although defendant was acquitted of mailing a threatening communication, this did not affect the “most analogous guideline” inquiry. U.S. v. Rakes, 510 F.3d 1280 (10th Cir. 2007).
10th Circuit rejects large departure/variance based on uncharged conduct that was not related to current offense. (175) The FBI began to investigate defendant after an adult dancer reported defendant had discussed with her in detail his desire to kidnap, rape and kill young girls. The FBI investigated defendant for several months. Although there was some evidence that he had approached a young girl in Wal-Mart, and had been interrupted by the girl’s mother, the FBI was unable to find any additional evidence in this regard. Therefore, it shifted the focus of its investigation to defendant’s illegal drug activity. He pled guilty to a single count of possession of methamphetamine with intent to distribute. Although his guideline range was 120-135 months, the district court sentenced defendant to 360 months, finding the advisory guideline range “vastly inadequate.” The Tenth Circuit reversed. The horrific sexual abuse and murder that defendant either contemplated or took steps toward committing were not relevant conduct because they were completely unrelated to his sale of meth. The court could not have departed under the guidelines on the basis of these facts. When a § 5K2.0 departure is based on acts of misconduct not resulting in conviction, those acts must still relate meaningfully to the offense of conviction. Section 4A1.3(a)(2) also was unavailing, because the uncharged conduct was not similar adult criminal conduct. Finally, in an exercise of Booker discretion, a sentencing court may not discard the advisory guideline range and impose a sentence based on evidence of the defendant’s uncharged, unrelated misconduct, whether actually committed or contemplated for the future. U.S. v. Allen, 488 F.3d 1244 (10th Cir. 2007).
10th Circuit holds that consideration of acquitted conduct does not violate double jeopardy. (175) Defendant argued that it violated his double jeopardy rights to relitigate at sentencing those facts that were found in his favor at trial. The Tenth Circuit disagreed – an offense need not be ignored for sentencing purposes just because the jury found the defendant not guilty of the offense. The double jeopardy clause is not violated when the sentencing court considers conduct for which the defendant was acquitted. This result follows from the difference between the standard of proof at trial and the standard of proof at sentencing. The existence of reasonable doubt as to guilt does not preclude the sentencing court from finding by a preponderance of the evidence that the conduct occurred. U.S. v. Mendez-Zamora, 296 F.3d 1013 (10th Cir. 2002).
10th Circuit holds defendant accountable for losses caused by co-conspirators. (175) Defendant printed on his home computer several counterfeit checks drawn on his employer’s account. The checks were cashed by a minor female conspirator. On September 18 and 19, two minor co-conspirators cashed several additional counterfeit checks, resulting in losses of over $9000. Although defendant disclaimed prior knowledge of the girls’ activities, one of the girls testified that defendant had created and printed half of these checks. In additional, defendant’s fingerprint was found on one of the checks. Finally, on September 30, the conspirators were arrested after cashing three more counterfeit checks. The Tenth Circuit ruled that defendant was properly held accountable for the losses caused by his co-conspirators on September 18 and 19. In his plea agreement, defendant admitted responsibility for the September 18 and 19 checks. By admitting legal responsibility for the acts of his co-conspirators on September 18 and 19, defendant necessarily admitted that those acts were reasonably foreseeable and were undertaken in furtherance of the conspiracy. Thus, there was sufficient evidence to support the court’s finding that defendant was responsible for losses in excess of $20,000. U.S. v. Suitor, 253 F.3d 1206 (10th Cir. 2001).
10th Circuit applies bodily injury increase for injury inflicted by police officer. (175) Defendant robbed a police credit union. A police officer, present in the bank on personal business, was mistakenly told that the perpetrator was still in the bank parking lot in a blue car. The officer approached a blue car in the parking lot. When the driver began to reach for the floor of the car and then drive away, the officer fired a shot, injuring the driver, who was actually an innocent bank customer. The district court applied a § 2B3.1(b)(3)(B) enhancement for the customer’s serious bodily injury. Defendant argued that no one reasonably could have expected an unarmed bank robbery and successful getaway would end in the injury of an innocent bystander. The Tenth Circuit affirmed the enhancement, since it was foreseeable that, given the inherently dangerous nature of bank robbery, a bystander might be seriously injured during the flight or apprehension of the criminal. The customer’s injury was not beyond the “outer limits of foreseeability.” Because defendant robbed a police credit union, it was foreseeable that a police officer conducting personal business at the bank might pursue defendant. The fact that defendant did not use a weapon in the robbery did not remove the use of force by a pursuing officer from the realm of possibility. U.S. v. Metzger, 233 F.3d 1226 (10th Cir. 2000).
10th Circuit holds that fraudulent attempt to get driver’s license not part of current bank fraud. (175) Defendant pled guilty to bank fraud and using a false social security number. Defendant had a prior conviction for forging a public document based on his attempt to obtain a Virginia driver’s license under a false name. Defendant argued that the Virginia conviction constituted relevant conduct and thus could not be included in his criminal history. See USSG § 4A1.2(a)(1) (“prior sentence” must be for conduct not part of the current offense). To determine whether a prior offense is related to the current offense, courts generally examine the similarity, temporal proximity and regularity of the current offense and the prior conduct. The district court found that the Virginia conviction did not involve monetary harm and was therefore not similar to the current bank fraud. Because defendant did not link the Virginia alias to the offenses involved in this case, the Tenth Circuit ruled that the district court’s finding was not clearly erroneous. U.S. v. Keifer, 198 F.3d 798 (10th Cir. 1999).
10th Circuit includes uncharged fraud in loss calculation. (175) Defendant served as a “like kind” accommodator to facilitate transactions under IRC § 1031. A taxpayer would give the proceeds of a real estate sale to defendant, who would hold the proceeds until the taxpayer located another piece of real estate to purchase. Defendant then provided the deposited funds to close on the second property. Defendant began to use client funds for his own personal expenses and to repay the closing proceeds from other clients’ transactions. The Tenth Circuit held that the district court properly included in the loss calculation $2,000 that one client gave to defendant in a similar but uncharged transaction. It is well established that sentencing calculations can include as relevant conduct actions that do not lead to separate convictions. The $2,000 was relevant to defendant’s sentencing because it constituted an element of “the same course of conduct or common scheme or plan” as defendant’s charged acts of wire fraud. U.S. v. Burridge, 191 F.3d 1297 (10th Cir. 1999).
10th Circuit uses gain as estimate of loss where foreign losses were not relevant conduct. (175) Defendant was involved in the fraudulent sale of American securities in Germany. In calculating loss under § 2F1.1, the district court used defendant’s $650,000 gain, rather than the estimated $18-25 million in actual loss to the victims. The Tenth Circuit affirmed. Relying on a defendant’s gain is per se unreasonable only where the actual or intended loss is non-existent. Here, the district court properly found that a co-conspirator’s activities in Germany, and the losses those activities created, did not constitute relevant conduct attributable to defendant. Many of the co-conspirator’s acts could not have been reasonably foreseen by defendant. The co-conspirator was the mastermind behind the enterprise and its driving force. Defendant had little input regarding the co-conspirator’s activities in Germany: he rarely contacted and never directly supervised the sales persons in Germany; he was not otherwise involved with or in control of the sale practices of the German operations; and he was kept in the dark by the co-conspirator about many of the German activities. U.S. v. Brown, 164 F.3d 1146 (10th Cir. 1998).
10th Circuit sentences defendant for child pornography produced by co-conspirators. (175) Defendant was a member of an on-line Internet “chat room” that discussed child pornography and traded digital images via computer. He authored a “charter” for the chat room, which listed chat room goals, membership policies, and established procedures for keeping the chat room secret. During the chat room’s existence, several members filmed their own “homemade” child pornography. Defendant was never accused of personally producing child pornography but he conversed with members about their sexual encounters with minors and traded their resulting images. Section 2G2.2(c)(1) directs a court to apply § 2G2.1 if the offense involved causing a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct. Defendant argued that the cross-reference did not apply to him because he did not personally make child pornography. The Tenth Circuit upheld the district court’s reliance on co-conspirators’ relevant conduct to apply the § 2G2.1 cross-reference. Under § 1B1.3(a) the co-conspirators’ conduct was reasonably foreseeable and in furtherance of a jointly undertaken criminal activity. Defendant was aware that child exploitation had taken place and he distributed child pornography produced by his co-conspirators. U.S. v. Tagore, 158 F.3d 1124 (10th Cir. 1998).
10th Circuit approves using relevant conduct in fraud loss calculation. (175) Defendant was the president of a company that sold telephone equipment to pay telephone service providers. The company advertised its products as new, when in fact the main circuit board in its telephones was used. Defendant was convicted of fraud and conspiracy in connection with the sale of 55 pay telephones to a particular customer. The Tenth Circuit approved counting defendant’s dealings with other customers as relevant conduct in calculating the § 2F1.1 loss. The other customers purchased used telephones that they believed were new, received defective equipment, or received their orders late or did not receive refunds for undelivered orders. All of these transactions occurred between 1990 and 1996, with most between 1992 and 1995. The court properly treated all of these incidents as relevant conduct for sentencing purposes because they involved the same course of criminal behavior. U.S. v. McClelland, 141 F.3d 967 (10th Cir. 1998).
10th Circuit holds shooting during assault was relevant conduct. (175) Defendants and several friends verbally taunted three black men at a bar. When the black men left the bar, defendants and his colleagues gave chase in their own cars. One of the friends fired a gun several times into the victims’ car, shattering the car’s rear window and injuring the occupant of the back seat. Defendants were convicted of various civil rights violations. The Tenth Circuit upheld the court’s use of the shooting as relevant conduct in their sentencing. The court properly found that defendants knew of their friend’s weapon. Defendants had racially taunted the victims repeatedly throughout the night. Each had possession of a handgun, and one defendant said he would like to use it on the victims. It strained credulity that defendants, all crowded in the front seat of a pickup truck, did not know that the friend had a rifle with a scope and a 20-round clip. U.S. v. Woodlee, 136 F.3d 1399 (10th Cir. 1998).
10th Circuit excludes counterfeit money from reverse sting that began after defendant’s arrest. (175) Defendant was recruited to help locate a suitable building for a counterfeiting operation and to loan the counterfeiter a truck and an employee to help move equipment. Federal agents arrested defendant and the associate as they were removing tracking devices placed on their vehicles. After the arrest, the associate worked with the Secret Service to set up a reverse sting to investigate a Texas investor who financed the operation. The reverse sting ultimately printed over $30 million in counterfeit money. Defendant did not participate in any of this activity and the Tenth Circuit ruled that he could not be held accountable for it. After defendant’s arrest, the original agreement was abandoned and was replaced by the reverse sting which was funded and equipped by the government to investigate a co-conspirator who defendant had never met. Although it was foreseeable that the counterfeiter would print a large sum of money, the post-arrest metamorphosis was not within the scope of the original counterfeiting plan. U.S. v. Melton, 131 F.3d 1400 (10th Cir. 1997).
10th Circuit includes acquitted and uncharged conduct in loss calculation. (175) Defendant recruited drivers to drive tow trucks. The drivers were required to pay defendant’s company about $4000 each as down payments on their tow truck leases. Thirty-six recruited drivers paid their money to defendant’s company but did not receive tow trucks or refunds. The company then went bankrupt. Defendant was convicted of two counts of mail fraud and acquitted of five other counts. At sentencing, the court based the loss on the total losses to 40 drivers who paid down payments to defendant, even though defendant had been acquitted of defrauding some of those drivers and had not been charged with defrauding most of the rest. The Tenth Circuit held that the court properly considered all of defendant’s conduct, including acquitted and uncharged conduct. The court agreed with defendant that the PSR inflated the magnitude of his victims’ losses and in places was inconsistent, careless and ambiguous. However, until this appeal, defendant never challenged the factual accuracy of the PSR. Accordingly, his factual challenge was waived. U.S. v. Yarnell, 129 F.3d 1127 (10th Cir. 1997).
10th Circuit holds defendant accountable for laundered funds outside counts of conviction. (175) The district court held defendant accountable for the total value of laundered funds in the indictment, including sums alleged in money laundering counts for which defendant was not convicted. The Tenth Circuit upheld the use of funds involved in counts outside the conviction. All of the money laundering counts of the indictment were associated with the same fraud scheme. A court is not necessarily limited to the funds identified with the crime charged in the indictment, or the crime which resulted in a judgment of guilty. U.S. v. Kunzman, 54 F.3d 1522 (10th Cir. 1995).
10th Circuit agrees that “unbundling” medical procedures was not relevant conduct to submitting false claims. (175) Defendant was a licensed doctor employed as a full-time civilian “partner” in a medical insurance program at an army hospital. He was convicted of billing for procedures performed by other doctors. The 10th Circuit upheld the district court’s determination that defendant’s practice of “unbundling” medical procedures was not relevant conduct. Unbundling involves billing twice for the same procedure –billing once for an inclusive procedure (such as delivering a baby, which includes admission history, physical exam and post-partum care), and separately billing for the procedure’s component procedures (i.e. admission history, physical exam and post-partum care). The government did not establish that unbundling was the same scheme or plan as the charged conduct. Unbundling could have occurred by mistake or misunderstanding. U.S. v. Custodio, 39 F.3d 1121 (10th Cir. 1994).
10th Circuit says acquittal on possession charge irrelevant to quantity involved in conspiracy. (175) Defendant was convicted of conspiracy to possess with intent to distribute cocaine, and was acquitted of aiding and abetting the possession of cocaine with intent to distribute. She argued that it was error to base her sentence on 500 grams of cocaine since she was acquitted of the possession offense. The 10th Circuit found that her acquittal on possession charges was irrelevant to determining the quantity of drugs attributable to her on the conspiracy conviction. Defendant could be sentenced on the basis of cocaine possessed by another conspirator, so long as the amount possessed was within the scope of the conspiracy and foreseeable to her. U.S. v. Arias-Santos, 39 F.3d 1070 (10th Cir. 1994).
10th Circuit holds that section 1B1.2 does not prohibit consideration of relevant conduct. (175) Section 1B1.2 provides that where a plea agreement contains a stipulation that specifically establishes a more serious offense than the offense of conviction, the offense level is based on the guideline for the stipulated offense. Defendant argued that since he did not stipulate to a more serious offense, the judge could not use relevant conduct to sentence him for a more serious offense. The 10th Circuit held that section 1B1.2 did not prohibit consideration of relevant conduct. The relevant conduct guideline, § 1B1.3(a)(2), directs that the entire picture of the defendant’s conduct be considered when determining the base offense. The fact that the plea agreement called for the dismissal of the more serious counts did not render the relevant conduct guideline inoperative. U.S. v. McGee, 7 F.3d 1496 (10th Cir. 1993).
10th Circuit includes uncharged tax evasion as relevant conduct. (175) Relying on U.S. v. Daniel, 956 F.2d 540 (6th Cir. 1992), defendant argued that the district court improperly included tax evasion from years not covered in the offense of conviction, in calculating the tax loss under 2T1.1. The 10th Circuit distinguished Daniel as a case in which the evidence revealed only civil liability for uncharged conduct. Because defendant’s uncharged conduct was shown to be criminal, the uncharged conduct was properly considered relevant in calculating tax loss. U.S. v. Meek, 998 F.2d 776 (10th Cir. 1993).
10th Circuit vacates obstruction adjustment for conduct unrelated to counts of conviction. (175) Defendant pleaded guilty to two counts of a six-count indictment. The district court enhanced defendant’s offense level for obstruction of justice, but the 10th Circuit reversed. An obstruction enhancement must be related to the counts of conviction. The acts relied on by the district court were unrelated to the counts of conviction; it was not apparent how they could have impeded investigation of the counts to which defendant pleaded guilty. The 10th Circuit refused to affirm the adjustment based on the government’s claim that defendant had testified untruthfully at the sentencing hearing, noting that this ground was not relied on by the district court. U.S. v. Levy, 992 F.2d 1081 (10th Cir. 1993).
10th Circuit includes value of software in loss from computer theft. (175) Convicted of stealing computer hardware, defendant objected to the district court’s including the value of software found on the hard disks defendant was convicted of stealing. Defendant maintained he was convicted only of stealing the hardware. The 10th Circuit questioned defendant’s characterization of his conviction, but held that the district court would properly have included the value of the software even if defendant’s assertion was correct. Theft of the software constituted relevant conduct under 1B1.3. Nor did the district court err in valuing the software at $265,000, the cost of a single sublicensed copy of the stolen software. U.S. v. Lyons, 992 F.2d 1029 (10th Cir. 1993).
10th Circuit affirms modest upward departure despite failure to state reasons for extent. (175) Defendant pled guilty to one count of bank fraud, with a guideline range of 15-21 months. The court departed upward by five months based on two automobile burglaries which defendant admitted and other criminal conduct that defendant did not admit. The 10th Circuit affirmed the departure, even though the district court failed to state its reasons for the extent of the departure. It was proper for the court to rely on information in the presentence report concerning the uncharged criminal conduct. The government was not required to produce evidence to prove this conduct since defendant did not contest the presentence report at sentencing. The degree of departure, only five months, was clearly reasonable in light of defendant’s substantial additional criminal conduct. Under Williams v. U.S., 112 S.Ct. 1112 (1992), no remand is required if the appellate court is satisfied that the district court would impose the same sentence if required to articulate its reasons. U.S. v. O’Dell, 965 F.2d 937 (10th Cir. 1992).
10th Circuit affirms firearm enhancement despite acquittal on section 924(c) charges. (175) The 10th Circuit affirmed an enhancement under guideline section 2D1.1(b)(1) despite defendant’s acquittal on charges of violating 18 U.S.C. section 924(c). The standard to convict on section 924(c) is much higher than that necessary for an enhancement under the guidelines. It was not clearly improbable that the weapons were connected to the drug trafficking offense. Marijuana cultivation was occurring near defendant’s house. Near the door of the house leading to the carport, officers found a loaded rifle. In defendant’s truck, which had been used for marijuana cultivation, officers discovered a loaded rifle of which defendant’s son admitted ownership. Finally, near the shed where the tractor which had been used for the cultivation was parked, officers discovered another son’s loaded rifle. U.S. v. Morehead, 959 F.2d 1489 (10th Cir. 1992).
10th Circuit upholds firearms enhancement despite acquittal on firearms charge. (175) The 10th Circuit upheld an enhancement under guideline section 2D1.1(b) despite defendant’s acquittal of carrying a firearm in connection with a drug trafficking crime. There was evidence that two guns had been located for several days at the arrest scene; that they were handled at will by those persons who lived at the apartment; and that they were kept for the protection of the conspiracy participants and the money and the cocaine. That the jury did not convict the defendant of possessing the weapon during a drug trafficking crime did not bar the sentencing judge from considering this evidence. U.S. v. Coleman, 947 F.2d 1424 (10th Cir. 1991).
10th Circuit uses uncharged conduct to determine that defendant engaged in criminal conduct as a livelihood. (175) Defendant entered into plea agreement under which the government agreed not to bring any further charges based on acts committed prior to December 31, 1988. Defendant argued it constituted “further charges” for the government to advise the court at his sentencing hearing that defendant had committed the same crime almost 100 times during a seven-to-eight month period prior to prosecution. The 10th Circuit found that this did not violate the plea agreement, and that it was proper for the district court to use this information to determine that defendant was engaged in a pattern of criminal conduct from which he made his livelihood. The 10th Circuit also found that such seven-to-eight month period constituted “a substantial period of time.” U.S. v. Salazar, 909 F.2d 1442 (10th Cir. 1990).
10th Circuit upholds January 15, 1988, revisions to “relevant conduct” guideline § 1B1.3. (175) U.S.S.G. § 1B1.3 requires uncharged “relevant” conduct to be considered in sentencing. Defendant argued that the January 15, 1988 revisions to § 1B1.3 were beyond the scope of powers given to the Sentencing Commission. The 10th Circuit disagreed, holding the changes were “a permissible clarification of an existing guideline.” The court stated that the revisions to § 1B1.3 tracked the language of the earlier section and did not add to the definition of relevant conduct. Thus, the 1988 amendment was a “minor nonsubstantive” change relating to the application of a previously established guideline. U.S. v. Frederick, 897 F.2d 490 (10th Cir. 1990).
11th Circuit says court did not err in considering acquitted conduct. (175) Defendant was convicted of crimes related to multiple schemes to defraud the Florida and California Medicaid programs. He argued that the 5th and 6th Amendments barred the district court from using the offense level for wire fraud, mail fraud and interstate transportation of stolen property in fixing his base offense level for Count I (racketeering) because the jury’s special verdict on Count I and not guilty verdicts on the wire fraud counts had acquitted him of such offenses. The Eleventh Circuit held that the district court did not infringe defendant’s constitutional rights in considering conduct for which the jury acquitted him. There was nothing inconsistent with a jury verdict. Since the district court found by a preponderance of the evidence that defendant had acted in concert with others in relation to the fraud scheme, his argument that being acquitted of the wire fraud counts related to those scheme meant his acts were not jointly undertaken criminal activity was “fanciful on its face.” U.S. v. Bradley, 644 F.3d 1213 (11th Cir. 2011).
11th Circuit agrees that parallel Medicare fraud scheme was relevant conduct. (175) Defendant bribed doctors and Medicare beneficiaries to obtain prescriptions that allowed pharmacies to submit fraudulent Medicare reimbursement claims. Although it was not charged in the indictment, defendant was independently submitting similar, fraudulent Medicare claims on behalf of her own company, PRN Home Health Care, which provided medical equipment to Medicare beneficiaries. The Eleventh Circuit held that the district court did not clearly err by finding that the PRN scheme was relevant conduct under §1B1.3. First, the victims and purpose of each scheme were the same. Second, the two schemes involved the same modus operandi of submitting fraudulent claims to Medicare for reimbursement. Third, both schemes used many of the same patients to bill Medicare. Finally, the aerosol medication billed by the pharmacies was commonly ingested through the aerosol durable medical equipment billed by PRN, and Medicare would only reimburse aerosol medication taken through that type of equipment. U.S. v. Valladares, 544 F.3d 1257 (11th Cir. 2008).
11th Circuit holds defendant accountable for entire loss generated by fraud and money laundering scheme. (175) Defendant was convicted of fraud and money laundering in connection with an illegal Ponzi scheme. The Eleventh Circuit upheld the district court’s finding that the loss attributable to defendant for sentencing under § 1B1.3(a)(1)(B) was $51 million, the total amount of money laundered in the conspiracy. For a defendant convicted of conspiracy, the district court must first determine the scope of criminal activity the defendant agreed to jointly undertake, and then consider all reasonably foreseeable acts and omissions of others in the jointly undertaken criminal activity. Defendant was involved in contacting and recruiting clients into the fraud scheme. More importantly, he was involved in the scheme from nearly its inception, and placed a critical role in its success. Although he did not “design” the program, he concocted the method in which he could continue to pull investors into the program and further the scheme. U.S. v. McCrimmon, 362 F.3d 725 (11th Cir. 2004).
11th Circuit holds previous fraud scheme was not relevant conduct to current fraud. (175) In 1989, defendant participated in the CCC fraud in which the Crystal Clear Corporation solicited investors through newspaper ads and toll-free numbers to purchase and install bottled-water-vending machines. The company took investors’ money, but did not install or operate the vending machines, and did not pay the investors any return. Between 1993 and 1994, defendant participated in the NNI fraud in which National Nurseries, Inc. solicited investors through newspaper ads to purchase greenhouses. NNI falsely claimed it had contracts with major accounts to purchase plants grown by the investors. In 1995, defendant pled guilty to the CCC fraud, and the court did not consider the NNI fraud at sentencing. Defendant later pled guilty to the NNI fraud. The Eleventh Circuit upheld consecutive sentences under § 5G1.3(b), finding that the CCC fraud was not relevant conduct to the NNI fraud. The fact that both schemes involved fraud did not make them related. They involved different subject matter, different parties, and different victims. They were also separated in time, and differed in scope. U.S. v. Blanc, 146 F.3d 847 (11th Cir. 1998).
11th Circuit requires considering full value of cars stolen for parts. (175) Defendants were involved in a conspiracy to possess stolen vehicles and parts and remove or alter their VINs. In determining loss, the district court considered only the value of the parts, not the vehicles from which they were taken. The Eleventh Circuit held that the loss should have been based on the worth of the stolen cars tied directly to defendants. A district court may consider, for sentencing purposes, relevant conduct not contained in the indictment. A convicted car thief testified that defendants admitted to him that they stole cars, describing their methods. The owner of a stolen car identified defendant as someone he had seen closely examining his car, the parts of which police later found, covered with defendants’ fingerprints, in a warehouse rented by defendants. In addition, police found parts of cars that defendants admitted to stealing. U.S. v. Exarhos, 135 F.3d 723 (11th Cir. 1998).
11th Circuit holds that “year” in § 2T1.1(b)(1) refers to taxable year, not any 12-month period. (175) Defendant, the head of a local housing authority, gave favorable references to a mortgage company that financed several of the authority’s projects. The mortgage company paid a law firm “referral fees” totaling $15,000, and in 1989, the law firm paid defendant five checks totaling $9,666. Defendant did not report any of this money as income. The government charged defendant with mail fraud and income tax evasion, on the theory that the money was part of a “kickback” scheme. A jury acquitted defendant of mail fraud but convicted him of income tax evasion. The district court applied § 2T1.1(b)(1) for failing to report more than $10,000 from criminal activity in one year. The Eleventh Circuit reversed, because over $10,000 was not received by the law firm in the same taxable year. The entire $15,000 paid to the law firm was attributable to defendant—the law firm was merely a “conduit.” However, defendant did not receive $15,000 in “one year.” For purposes of § 2T1.1(b)(1), “year” means taxable year, which in this case was the 1989 calendar year. The law firm received a $5,000 check in December of 1988 and a $10,000 check in January of 1989. U.S. v. Barakat, 130 F.3d 1448 (11th Cir. 1997).
11th Circuit holds relevant conduct did not include losses before defendant joined conspiracy. (175) Defendant was convicted of mail fraud for his involvement in a fraudulent securities scheme. However, he did not join the conspiracy until several months after it began. The district court attributed the losses from the entire conspiracy to defendant. The Eleventh Circuit reversed, noting that Note 2 to § 1B1.3 provides that a defendant’s relevant conduct does not include the conduct of members of the conspiracy prior to the defendant joining the conspiracy, even if the defendant knows of that conduct. Although this note was an amendment to prior commentary to the sentencing guideline provision, it was relevant because it clarified the guideline. U.S. v. Word, 129 F.3d 1209 (11th Cir. 1997).
11th Circuit finds state chop shop operation was relevant conduct to federal chop shop. (175) Defendant pled guilty in federal court to running a “chop shop” operation. Before the federal prosecution he had been convicted in state court for stealing and “chopping” three different Porsche automobiles. The Eleventh Circuit held that the state chop shop charges were relevant conduct to the federal charges. The offenses met the test of similarity, regularity, and temporal proximity. Both offenses were very similar, if not identical. The offenses were committed with clear regularity and within a very close time period. In a one year period, defendant stole and chopped Porsches at least 18 times. The last state Porsche was stolen in March 1991, and five of the federal Porsches were stolen at unknown dates in 1991. The offenses formed an ongoing series of offenses and therefore qualified as the same course of conduct. U.S. v. Fuentes, 107 F.3d 1515 (11th Cir. 1997).
11th Circuit relies on relevant conduct outside statute of limitations. (175) Defendant, an insurance agent, converted for his own use $12,000 given to him by a client to fund a pension fund. The district court included in the loss over $300,000 that the insurance company lost as a result of defendant’s other thefts, verbal misrepresentations and unauthorized withdrawals from client accounts. Defendant argued that these losses occurred outside the statute of limitations. The Eleventh Circuit held that a court may consider as relevant conduct all conduct that occurred outside the statute of limitations. The government has no duty to advise a defendant before he pleads guilty which relevant conduct the court will use to enhance his sentence. The relevant conduct is unknown to both the government and the defendant when the plea is entered, since the parole officer has not yet prepared a PSR. The government does not have a duty to disclose information it does not possess. U.S. v. Behr, 93 F.3d 764 (11th Cir. 1996).
11th Circuit says felon in possession must accept responsibility for acts while he possessed gun. (175) Defendant pled guilty to possession a firearm by a felon. He admitted using a gun to commit a robbery, but claimed he could not remember whether he had pulled the trigger. The district court denied a § 3E1.1 reduction because defendant was not forthright about brandishing the gun and pulling its trigger. Defendant argued that these actions did not constitute relevant conduct because they were not used to calculate his offense level. The Eleventh Circuit held that the actions were relevant conduct because they occurred during the offense of conviction. Relevant conduct is not limited to those acts and omissions that are used to calculate the applicable guideline range. U.S. v. Coe, 79 F.3d 126 (11th Cir. 1996).
11th Circuit upholds enhancement for co-conspirator’s firearm possession despite acquittal. (175) Defendant and others were arrested after selling drugs to an informant. Defendant received a firearm enhancement under section 2D1.1(b)(1) because a co-conspirator threw a pistol out of defendant’s car just before they were arrested. The 11th Circuit affirmed despite defendant’s acquittal on firearm charges. Acquitted conduct may be considered because an acquittal represents a lack of proof higher than the preponderance of evidence required for relevant conduct at sentencing. The enhancement based on the passenger’s gun was proper because the passenger was charged as a co-conspirator, the firearm was possessed in furtherance of the conspiracy, and defendant was a member of the conspiracy at the time of the gun possession. U.S. v. Stanley, 24 F.3d 1314 (11th Cir. 1994).
11th Circuit bars reliance on relevant conduct in applying assault cross-reference. (175) Defendant was convicted of simple assault on one corrections officer and acquitted of aggravated assault on another. The applicable guideline, section 2A2.4 (Obstructing or Impeding Officers), says that if the conduct constituted aggravated assault, section 2A2.2 (Aggravated Assault) should be applied. The district court sentenced defendant under section 2A2.2, based on the conduct for which defendant had been acquitted. The 11th Circuit reversed, holding that a court cannot consider relevant conduct in applying the cross-reference in section 2A2.4. The “conduct” must be related to the offense of conviction in order to be considered relevant conduct under 1B1.3. U.S. v. Jennings, 991 F.2d 725 (11th Cir. 1993).
11th Circuit holds that loss calculation should include amounts involved in dismissed counts. (175) The 11th Circuit rejected defendant’s claim that it was improper to include amounts involved in dismissed counts in the calculation of loss under section 2F1.1. Application notes 6 and 7 to section 2F1.1 clearly indicate that the cumulative loss produced by a common scheme or plan should be used in determining the offense level for fraud, regardless of the number of counts of conviction. Section 1B1.3, concerning relevant conduct, also supports this conclusion. The records indicated that the methods which defendant used to defraud the government were part of the same course of conduct and displayed a common scheme. U.S. v. Rayborn, 957 F.2d 841 (11th Cir. 1992).
11th Circuit holds that district court may consider uncharged conduct. (175) Defendant’s base offense level for the delivery of counterfeit notes was calculated by including 1.1 million dollars in counterfeit notes which defendant was not charged with delivering. The 11th Circuit held that a sentencing court can rely on offense conduct not charged in an indictment to calculate a defendant’s sentence, provided the defendant had notice of the government’s intention to present at the sentencing hearing evidence of such other conduct. U.S. v. Ignancio Munio, 909 F.2d 436 (11th Cir. 1990).
11th Circuit rules sentence was properly based on all nineteen thefts, even though defendant pled guilty to only one. (175) Since all nineteen thefts were “part of the same course of conduct,” the sentencing court properly considered them under the “relevant conduct” section of the guidelines, 1B1.3(a). In a lengthy discussion of the theory behind the sentencing guidelines, the Eleventh Circuit explained that defendant was “sentenced for the December 16 theft alone, but in assessing the seriousness of that offense the guidelines took into account the fact that appellant’s offense of conviction was not an isolated event but rather was the last of a series of offenses.” The fact that defendant had “nothing to gain” from the plea agreement which dropped the other charges, did not make the sentence unfair or inequitable. U.S. v. Scroggins, 880 F.2d 1204 (11th Cir. 1989).
D.C. Circuit approves post-Booker sentence that was based on acquitted conduct. (175) Defendant was convicted of making a false statement to the FBI and acquitted of conspiracy to commit money laundering and conspiracy to defraud the government. In sentencing, the district court took into account defendant’s role in the conspiracies, finding by a preponderance of the evidence that he was involved in them notwithstanding his acquittal of those offenses. The D.C. Circuit held that the basing his sentence in part on acquitted conduct did not violate the Fifth or Sixth Amendment. Before U.S. v. Booker, 543 U.S. 220 (2005), courts had held that a sentencing court could consider acquitted conduct if the conduct was proved by a preponderance of the evidence. Nothing in Booker undermined this precedent. Under Booker, consideration of acquitted conduct violated the Sixth Amendment only if the judge imposed a sentence that exceeded what the jury verdict authorized. Defendant’s 24-month sentence did not exceed the 60-month statutory maximum for his false statement offense. U.S. v. Dorcely, 454 F.3d 366 (D.C. Cir. 2006).
D.C. Circuit holds parallel fraud transactions were relevant conduct. (175) Defendant conspired with Powell, a buyer for a NASA contractor, to inflate the prices NASA spent on supplies from defendant’s company, and the two split the profits. Powell operated a similar scheme with two other companies. The D.C. Circuit held that the parallel transactions with the other two companies were relevant conduct, and thus the profits from these schemes could be included in defendant’s loss calculation. Defendant helped launder the proceeds of several of the parallel transactions with one corporation, and his explanations for doing so were inconsistent. This provided ample basis for finding that the transactions with this corporation fell within the scope of the conspiracy in which defendant agreed to participate. While the evidence tying defendant to the second corporation was weaker, the district court did not clearly err in finding that they were relevant conduct. Although defendant claimed he withdrew from the conspiracy in the summer of 1997 by ceasing to do business with Powell, defendant acknowledged that on one occasion Powell sent him a check after the summer of 1997. U.S. v. Seilor, 348 F.3d 265 (D.C. Cir. 2003).
D.C. Circuit rejects assumption that defendants participated in conspiracy from beginning of employment. (175) Defendants, motor vehicle inspectors for the District of Columbia, sold inspection stickers to taxicab drivers and others. The court calculated the total amount of bribes attributable to defendants under § 2C1.1 based on the assumption that they began participating in the bribery scheme as soon as they began working at the inspection station. Instead of identifying specific facts to establish that their involvement began at that time, the court relied on the fact that the conspiracy required the cooperation of other inspectors to make it work. Because “there was never any indication that [they were] not involved from the beginning,” the court inferred that both defendants must have joined the scheme quite soon after starting work at the station. The D.C. Circuit rejected this inference, since the record showed that not all of the inspectors at the inspection station were involved in the conspiracy. It was possible that defendants waited some time before joining the conspiracy. The error was harmless as to one defendant, since even if the court subtracted the bribe amounts involved before his participation was established, it would not change his offense level. However, the error was not harmless for the second defendant. U.S. v. Williams, 216 F.3d 1099 (D.C. Cir. 2000).
D.C. Circuit considers underlying conduct in applying cross-reference to aggravated assault. (175) Defendant was convicted of assaulting a federal officer after he attempted to hit an INS agent with his car. Section 2A2.4(c)(1) provides that the court should apply § 2A2.2, the aggravated assault guideline, if the conduct constituted aggravated assault. Defendant argued that the district court improperly considered relevant conduct in applying the cross-reference. The D.C. Circuit adopted the analysis of U.S. v. Street, 66 F.3d 969 (8th Cir. 1995), and held that the 1992 amendment to § 2A2.4(c)(1) allows a court to consider relevant or underlying conduct in deciding whether to apply the cross-reference to § 2A2.2. The amendment removed certain language regarding convictions under 18 U.S.C. § 111 and stated that § 2A2.2 should be applied “on the basis of the underlying conduct.” Defendant’s conduct with the car was an aggravated assault. His claim that he only intended to frighten the INS agent was inconsistent with his accelerating despite the agent’s warning that the car was about to hit him. U.S. v. Valdez-Torres, 108 F.3d 385 (D.C. Cir. 1997).
D.C. Circuit holds fraudulent credit offense was not relevant conduct to counterfeit check offense. (175) Defendant pled guilty to cashing five counterfeit checks using a false name. Three other fraud counts were dismissed: 1) a count based on defendant’s use of a counterfeit check to open a brokerage account under another alias; 2) a count based on his use of another counterfeit check drawn on the same fictitious account to purchase a car; and 3) a count based on his use of two aliases to file a fraudulent credit card application. The D.C. Circuit held that the two counts involving counterfeit checks were relevant conduct, but the count involving the fraudulent credit card application was not. In each of the check cases, defendant, using an alias, presented a counterfeit check to obtain cash or an automobile. The offenses involved similar instruments and a similar method. However, the credit card fraud was not part of the same course of conduct. It was of a different nature than the counterfeit check fraud. The fact that they both involved fraud to obtain money was not sufficient. U.S. v. Pinnick, 47 F.3d 434 (D.C. Cir. 1995).
Article supports basing sentence on charges dismissed under a plea agreement. (175) A student author reviews the case law concerning the use of charges dismissed pursuant to a plea agreement as a basis for imposing a longer sentence under the guidelines. He supports the use of dismissed charges to increase sentence length, on the assumption that defendants who agree to plea bargains involving dismissed charges know that the charges may be used in sentencing, The author argues that the use of charges dismissed under a plea agreement withstands both contract law and due process challenges. He concludes that using dismissed charges in sentencing advances the goals of the guidelines by reducing sentencing disparity and restraining prosecutorial discretion., Yin Tung, Not a Rotten Carrot—Using Charges Dismissed Pursuant to a Plea Agreement in Sentencing Under the Federal Guidelines, 83 Cal. L. Rev. 419 (1995).
Article advocates permitting “acquitted facts” to be used in sentencing. (175) A student author canvassed the authorities addressing whether facts negated by a jury’s acquittal should be considered in sentencing. Most courts permit use of such facts if they are established by a preponderance of the evidence. Some seem to permit their use only if the facts are undisputed. Others preclude their use. The majority view is preferable because of the different burdens of proof applicable at trial and at sentencing. Moreover, precluding use of “acquitted facts” would only periodically coerce judges into ignoring reliable evidence, would frustrate the policies of the Sentencing Reform Act, and would unduly limit judicial discretion. Note, United States v. Brady — Should Sentencing Courts Reconsider Disputed Acquitted Conduct for Enhancement Purposes under the Federal Sentencing Guidelines?, 46 Ark. L. Rev. 457-73 (1993).
Article questions enhancements for acquitted conduct. (175) A student author surveys the case law, generally concluding that a court may make findings at sentencing that conflict with the jury’s verdict. The author argues that, at least in some circumstances, such findings violate the spirit of the double jeopardy clause. Preclusive effect should be given to those facts that were necessarily decided in the defendant’s favor at trial. Note, Punishment Despite Acquittal — An Unconstitutional Aspect of the Federal Sentencing Guidelines, 34 Ariz. L. Rev. 799-825 (1992).
Articles address Ninth Circuit relevant conduct cases. (175) In a series of cases, the Ninth Circuit has departed from the position of other circuits by limiting the extent to which conduct underlying dismissed counts, uncharged conduct, and acquitted counts can be considered by a court in setting a guidelines range or in departing. In The Ninth Circuit’s Undeclared War on “Real Offense” Factors and Relevant Conduct, Roger W. Haines, Jr., argues that these decisions are contrary to the guidelines and that, by moving from a “real offense” toward a “charge offense” system, they transfer power from the courts to the prosecutors in contravention of the guidelines’ intent. In Relevant Conduct and Plea Bargaining, Steven E. Zipperstein argues that the Ninth Circuit cases have erred by treating charge bargains as if they were sentence bargains. He suggests that reduction of disparity requires treating the conduct underlying dismissed counts as relevant so long as those counts are groupable under section 3D1.2. In The Real Issue: Fair Plea Bargains, Not Relevant Conduct, Judy Clarke defends the Ninth Circuit cases, claiming they are necessary to ensure that plea bargaining remains a fair practice. 4 Fed. Sent. Rptr. 191, 194, 223 (1992).
Commission says dismissed counts in plea agreement are not excluded from relevant conduct. (175) In an amendment effective November 1, 1992, the Commission amended section 6B1.2(a) to state that “a plea agreement that includes the dismissal of a charge or a plea agreement not to pursue a potential charge shall not preclude the conduct underlying such charge from being considered under the provisions of section 1B1.3 (relevant conduct) in connection with the count(s) of which the defendant is convicted.”