Filed: Apr. 26, 2013
Latest Update: Mar. 02, 2020
Summary: Case: 11-14177 Date Filed: 04/26/2013 Page: 1 of 10 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 11-14177 _ D.C. Docket No. 6:11-cr-101-JA-KRS-4 UNITED STATES OF AMERICA, Plaintiff-Appellee, vs. GARY WASHINGTON, Defendant-Appellant. _ Appeal from the United States District Court for the Middle District of Florida _ (April 26, 2013) Before PRYOR and JORDAN, Circuit Judges, and PRO, District Judge.* JORDAN, Circuit Judge: _ *Honorable Philip M. Pro, United States
Summary: Case: 11-14177 Date Filed: 04/26/2013 Page: 1 of 10 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 11-14177 _ D.C. Docket No. 6:11-cr-101-JA-KRS-4 UNITED STATES OF AMERICA, Plaintiff-Appellee, vs. GARY WASHINGTON, Defendant-Appellant. _ Appeal from the United States District Court for the Middle District of Florida _ (April 26, 2013) Before PRYOR and JORDAN, Circuit Judges, and PRO, District Judge.* JORDAN, Circuit Judge: _ *Honorable Philip M. Pro, United States D..
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Case: 11-14177 Date Filed: 04/26/2013 Page: 1 of 10
[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
______________________
No. 11-14177
______________________
D.C. Docket No. 6:11-cr-101-JA-KRS-4
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
vs.
GARY WASHINGTON,
Defendant-Appellant.
_______________________
Appeal from the United States District Court
for the Middle District of Florida
_______________________
(April 26, 2013)
Before PRYOR and JORDAN, Circuit Judges, and PRO, District Judge.*
JORDAN, Circuit Judge:
____________________
*Honorable Philip M. Pro, United States District Judge for the District of Nevada, sitting by
designation.
Case: 11-14177 Date Filed: 04/26/2013 Page: 2 of 10
Sometimes a number is just a number, 1 but when the number at issue
triggers an enhancement under the Sentencing Guidelines, that number matters. In
this appeal we decide whether the government presented sufficient evidence that
250 or more persons or entities were victimized by the fraud scheme in which Gary
Washington participated. Because the government failed to put on any evidence
that there were 250 or more victims, we vacate Mr. Washington’s sentence and
remand for the district court to resentence Mr. Washington with a 2-level
enhancement under U.S.S.G. § 2B1.1(b)(2)(A) rather than a 6-level enhancement
under § 2B1.1(b)(2)(C).
I
In fraud causes, the Sentencing Guidelines provide for certain enhancements
to the base offense level depending on the number of victims. If there are 10 or
more victims, there is a 2-level enhancement; if there are 50 or more victims, there
is a 4-level enhancement; and if there are 250 or more victims, there is a 6-level
enhancement. See U.S.S.G. §§ 2B1.1(b)(2)(A)-(C).
A
Mr. Washington pled guilty to four offenses: conspiring with others to traffic
in unauthorized credit card numbers with the intent to defraud, in violation of 18
U.S.C. § 371; using and trafficking unauthorized credit card numbers with the
1
See, e.g., J. Keefe, Dow 10,000: Sometimes a Number is Just a Number, CBS Moneywatch
(Oct. 15, 2009).
2
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intent to defraud, in violation of 18 U.S.C. §§ 1029(a)(2) & (c)(1)(a)(i); possessing
15 or more unauthorized credit card numbers with the intent to defraud, in
violation of 18 U.S.C. §§ 1029(a)(3) & (c)(1)(a)(i); and possessing a re-encoding
machine with the intent to defraud, in violation of 18 U.S.C. §§ 1029(a)(4) &
(c)(1)(a)(ii). At the change of plea hearing, the government explained in its factual
proffer that Mr. Washington and his cohorts had fraudulently obtained the credit
card numbers of others by purchasing them (together with related account
information) over the Internet. They then encoded those numbers and account
information onto gift cards which they sold or used to make retail purchases.
Nothing in the government’s proffer, however, indicated that there were 250 or
more victims.
The probation office stated in the presentence investigation report that Mr.
Washington participated in the fraud scheme throughout its existence, from May of
2010 to March of 2011. The probation office assessed a 6-level enhancement
under U.S.S.G. § 2B1.1(b)(2)(C), explaining that “the offense involved hundreds
of individual victims whose financial information was stolen and unlawfully used
to make counterfeit credit cards, numerous retail businesses where the counterfeit
credit cards were used to make purchases, and approximately 30 credit card
companies which incurred losses as a result of the fraud.”
3
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In his objections to the presentence investigation report, Mr. Washington
maintained that he was involved in the scheme only from September of 2010 to
March of 2011. He also “dispute[d] the fact that there [were] more than 250
victims,” and “requeste[d] that at least 250 businesses or individuals be identified
by name.” In response to Mr. Washington’s objections, the probation office
prepared an addendum to the presentence investigation report. In that addendum,
the probation office continued to assert that Mr. Washington participated in the
scheme from May of 2010 to March of 2011, and stated that he had been provided
with “spreadsheets detailing the victims,” who numbered over 250.
The government, in its sentencing memorandum, acknowledged that Mr.
Washington began participating in the fraud scheme in September of 2010 (and not
in May of 2010, as the presentence investigation report had indicated), and
therefore could only be held responsible for the losses caused “during the time that
[he] was involved in the conspiracy.” 2 With respect to Mr. Washington’s
challenge to the enhancement for 250 or more victims, the government said that
“thousands of individuals” had their credit card numbers stolen. It did not,
however, submit any evidence to support this assertion.
In his response to the government’s sentencing memorandum, Mr.
Washington “concede[d] that in all probability there were more tha[n] 250
2
As a result, the government conceded that Mr. Washington’s loss amount under the Sentencing
Guidelines fell from $1.2 million to $900,000.
4
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victims,” but noted that the government had only identified 70 banks and financial
institutions as victims. He again “requeste[d] hard evidence, and not verbal
assurances of opposing counsel,” that there were 250 or more victims.
So, as things stood prior to the sentencing hearing, the government was
advocating for the § 2B1.1(b)(2)(C) enhancement, and Mr. Washington was
objecting to the enhancement. The government, therefore, bore the burden of
establishing the factual basis for the enhancement at the hearing. See, e.g., United
States v. Askew, 193 F.3d 1181, 1183 (11th Cir. 1999).
B
At the sentencing hearing, the district court reduced the loss amount for Mr.
Washington based on the parties’ agreement that he joined the fraud scheme in
September of 2010. Mr. Washington objected to the 6-level enhancement under §
2B1.1(b)(2)(C), arguing that the defense had “never been shown more than 250
victims” and that he “wanted the [government] just to satisfy to the court’s
satisfaction that there [were] more than 250 victims[.]”
The government responded that the victims were the individual cardholders,
who numbered over 6,000, and that “there were well more than 250 during the
time -- .” 3 At that point the district court interjected: “That’s the figure that’s been
applied to other defendants. That method of calculation has been used in all of the
3
We assume that the government meant to say “during the time Mr. Washington was involved in
the scheme.”
5
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other cases. The objection is overruled.” The government did not present any
evidence – no spreadsheets, no documents, no witnesses – identifying 250 or more
victims. Nor did it ask the district court for an opportunity to put on any such
evidence.
The district court ultimately found that Mr. Washington had a total offense
level of 27 with a criminal history category of IV, leading to an advisory guideline
range of 100-125 months’ imprisonment. The district court granted the
government’s motion for a substantial assistance reduction pursuant to U.S.S.G. §
5K1.1, and reduced Mr. Washington’s total offense level to 25 and his advisory
guideline range to 84-105 months’ imprisonment. The district court declined to
vary from that range, and sentenced Mr. Washington to 105 months in prison,
followed by 3 years of supervised release. It also ordered Mr. Washington to pay
$900,982.27 in restitution to the 34 victims – all financial institutions – identified
in the presentence investigation report.
II
When the government seeks to apply an enhancement under the Sentencing
Guidelines over a defendant’s factual objection, it has the burden of introducing
“sufficient and reliable” evidence to prove the necessary facts by a preponderance
of the evidence. See, e.g., United States v. Perez-Oliveros, 479 F.3d 779, 783
(11th Cir. 2007);
Askew, 193 F.3d at 1183. In this case the government failed to
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carry its burden, as it did not introduce any evidence to support the §
2B1.1(b)(2)(C) enhancement.
The government told the district court at the sentencing hearing that over
6,000 individuals had their credit card numbers and related account information
stolen, and that there were 250 or more victims during the time Mr. Washington
was involved in the scheme. This representation, however, was insufficient. As
we have said before, absent a stipulation or agreement between the parties, an
attorney’s factual assertions at a sentencing hearing do not constitute evidence that
a district court can rely on. See, e.g., United States v. Onofre-Segarra, 126 F.3d
1308, 1310-11 (11th Cir. 1997) (“The arguments of counsel and the challenged
conclusions of the presentence investigation report . . . are generally an insufficient
basis upon which to depart from the guidelines.”); United States v. Wilson,
884
F.2d 1355, 1356 (11th Cir. 1989) (“At the sentencing hearing defendant’s counsel
argued that defendant’s plea negotiations demonstrated acceptance of
responsibility but offered no evidence that would establish his qualification for a
reduction under this section. . . . Because at sentencing defendant offered no
evidence of acceptance of responsibility and the evidence at trial did not clearly
demonstrate such an acceptance, defendant simply failed to meet his burden of
proof [.]”).
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We understand that the district court had applied the § 2B1.1(b)(2)(C)
enhancement to Mr. Washington’s co-conspirators, but on this record those rulings
could not serve as a basis for applying the enhancement to Mr. Washington. First,
“evidence presented at the trial [or sentencing hearing] of another may not –
without more – be used to fashion a defendant’s sentence if the defendant objects.
In such a case, where the defendant has not had the opportunity to rebut the
evidence or generally to cast doubt upon its reliability, he must be afforded that
opportunity.” United States v. Castellanos, 904 F.2d 1490, 1496 (11th Cir. 1990).
If the government wanted to rely on evidence presented and findings made during
the co-conspirators’ sentencing hearings, it had the obligation to order the
transcripts of those hearings and make them available to Mr. Washington and the
district court. Second, Mr. Washington joined the fraud scheme in September of
2010, four months after its inception, and could not “be held accountable for
conduct that occurred prior to his entry into the joint criminal undertaking.”
United States v. Hunter,
323 F.3d 1314, 1320 (11th Cir. 2003) (citing U.S.S.G. §
1B1.3, cmt. (n.2)). Because it failed to present any evidence as to the identities of
the individual victims, and when their credit card numbers and related account
information were stolen, the government did not meet its burden of establishing
that the fraud scheme involved 250 or more victims from September of 2010 to
March of 2011.
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III
The government asks that it be allowed to prove on remand that there were
250 or more victims for whom Mr. Washington was responsible. We decline the
government’s request.
Nothing prevented the government – which was aware of Mr. Washington’s
objection – from putting on evidence concerning the number of victims at the
sentencing hearing, and a party who bears the burden on a contested sentencing
issue will generally not get to try again on remand if its evidence is found to be
insufficient on appeal. We have discretion to “permit[ ] the government to present
evidence at resentencing even though it amount[s] to giving the party ‘a second
bite at the apple.’” United States v. Martinez, 606 F.3d 1303, 1304-05 (11th Cir.
2010). But often a “remand for further findings is inappropriate when the issue
was before the [district] court and the parties had an opportunity to introduce
relevant evidence,” United States v. Canty,
570 F.3d 1251, 1257 (11th Cir. 2009),
and here the government failed to present any evidence concerning the number of
victims. See United States v. Alred,
144 F.3d 1405, 1422 (11th Cir. 1998) (“We
conclude that the evidence presented by the government . . . of Roy Alred’s
buyer/seller and fronting relationships is insufficient to support his four-level
enhancement under [§] 3B1.1(a) for having a leadership role. . . . On remand, the
district judge will resentence him without the [§] 3B1.1(a) enhancement.”). See
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also United States v. Archer, 671 F.3d 149, 168 (2d Cir. 2011) (“The consensus
among our sister circuits is that generally where the government knew of its
obligation to present evidence and failed to do so, it may not enter new evidence
on remand. Nonetheless, there are cases (a) where the government’s burden was
unclear, (b) where the trial court prohibited discussion of the issue, or (c) where the
evidence was, for a good reason, unavailable, in which the district court was
permitted, in its discretion, to hear new evidence.”); United States v. Leonzo,
50
F.3d 1086, 1088 (D.C. Cir. 1995) (“No special circumstances justified, or even
explained, the government’s failure to sustain [its] burdens.”).
IV
The 6-level enhancement under § 2B1.1(b)(2)(C) is set aside, and the case is
remanded for resentencing without that enhancement. The district court should
impose a 2-level enhancement under § 2B1.1(b)(2)(A) because Mr. Washington
has conceded on appeal that there were 10 or more victims of his conduct.
VACATED AND REMANDED.
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