USCA1 Opinion
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
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No. 96-1203
UNITED STATES OF AMERICA,
Appellee,
v.
CHARLES HENRY GILL, JR.,
Defendant, Appellant.
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APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MAINE
[Hon. Gene Carter, U.S. District Judge]
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Before
Torruella, Chief Judge,
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Boudin, Circuit Judge,
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and Lisi,* District Judge.
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Terry A. Fralich with whom Peter J. DeTroy and Norman, Hanson &
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DeTroy were on briefs for appellant.
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Helene Kazanjian, Assistant United States Attorney, with whom
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Jay P. McCloskey, United States Attorney, was on brief for the United
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States.
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November 6, 1996
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*Of the District of Rhode Island, sitting by designation.
BOUDIN, Circuit Judge. Charles Gill appeals from his
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sentence, following a plea of guilty to various criminal
charges, to challenge two sentencing determinations made by
the district judge. One involves the issue of the vulnerable
victim adjustment, U.S.S.G. 3A1.1(b); the other, an
increase for abuse of a position of trust. Id. 3B1.3. The
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facts, which we briefly summarize, are drawn from the
presentence report, the sentencing transcript and various
other materials before the district court. United States v.
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Egemonye, 62 F.3d 425, 426 (1st Cir. 1995).
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From August 1993 until November 1994, Gill owned and
operated the Maine Health Trust, doing business as The
Counseling Center in Fryberg, Maine, and provided
psychological counseling services to individuals at the
Counseling Center during this period. Additionally, from
February 1994 to November 1994, Gill was employed part-time
at the Bethel Area Health Center in Bethel, Maine, where he
performed similar counseling services.
Gill told individual patients at the two facilities, and
his employers at the Bethel Area Health Center, that he
possessed a doctoral degree in psychology and was licensed as
a psychologist or counselor under Maine law. In fact, Gill
was not licensed and had never received an advanced degree in
either psychology or counseling. Gill had a substantial
record of offenses involving theft and passing bad checks.
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During the period in question, Gill submitted claims, or
caused patients and the Bethel Area Health Center to submit
claims for payment to various private insurance companies and
the Medicare and Medicaid programs for services that Gill
provided to them. The total value of the payments claimed
from these entities was over $37,000. Gill also made similar
false statements as to his credentials and licensing to the
insurance companies and to Medicare and Medicaid authorities.
Gill received payments totalling over $16,000 directly from
individual patients.
In March 1995, Gill pled guilty to one count of
willfully using a passport secured by means of a false
statement, 18 U.S.C. 1542, Gill having proffered the
passport when the Bethel Area Health Center requested proof
of his citizenship at the start of his employment. In
October 1995, Gill pled guilty to one count of mail fraud,
one count of wire fraud, and one count of making false
statements to the Medicare and Medicaid programs. 18 U.S.C.
1341, 1343; 42 U.S.C. 1320. All charges were
consolidated for sentencing.
Following a hearing on January 30, 1996, the district
court sentenced Gill to 40 months' imprisonment, three years
supervised release, and a requirement of restitution in the
amount of $43,481.49. The underlying calculations included a
two-level increase in Gill's base offense level for victim
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vulnerability, U.S.S.G. 3A1.1(b), and a two-level increase
for abuse of a position of trust, id. 3B1.3. It is these
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two adjustments that are the sole subjects of Gill's appeal
from his sentence. Gill was sentenced under the November
1995 edition of the guidelines, and references are to that
version unless otherwise specified.
The standard of review in such a case is simple, in fact
deceptively so, in the standard formulation: the district
court's factual findings are respected unless clearly
erroneous, and the determinations of law are reviewed de
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novo. United States v. Sabatino, 943 F.2d 94, 102 (1st Cir.
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1991). In principle, the application of a legal standard to
undisputed facts is also an issue of law, id., but in
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practice the matter is not quite so clear-cut.
Victim vulnerability. Since November 1, 1989, the
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provision now designated U.S.S.G. 3A1.1(b) has remained
substantially unchanged, although a recent change in the
commentary is pertinent to the issue of "targeting"
(discussed below). The black letter of section 3A1.1(b)
states that a two-level increase in the defendant's offense
level must be imposed:
[i]f the defendant knew or should have known that a
victim of the offense was unusually vulnerable due
to age, physical or mental condition, or that a
victim was otherwise particularly susceptible to
the criminal conduct.
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The presentence report proposed that the adjustment be
applied to Gill. As amended to reflect rulings on
objections, the report reasoned that Gill knew that the
patients with whom he would be dealing "had psychological
difficulties, mental health disorders and substance abuse
problems." Accordingly, the probation officer said that Gill
knew that his victims were vulnerable and "specifically
targeted them because of their `vulnerability' by [choosing]
to play the part of a person who treats such people with
mental health problems."
At sentencing, the district court concluded that the
victims "were especially vulnerable because of their needs
that gave rise to their seeking and their receiving of
services." The court cited decisions in other circuits
imposing such an adjustment on individuals fraudulently
providing medical services. See United States v. Echevarria,
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33 F.3d 175, 180-81 (2d Cir. 1994) (unlicensed doctor);
United States v. Bachynsky, 949 F.2d 722, 735-36 (5th Cir.
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1991) (physician making false diagnoses), cert. denied, 506
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U.S. 850 (1992).
Gill disputes the district court's adjustment on several
grounds. He argues that the finding of vulnerability must be
based on evidence as to individuals, rather than upon mere
membership in a class. He denies that the patients he
victimized were especially vulnerable. Finally, he says that
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he did not "target" the victims on account of their
vulnerability, a requirement he imputes to the guideline
based on commentary language. The first two claims are
related; the last we discuss separately in the next section
of this opinion.
The vulnerable victim guideline is primarily concerned
with the impaired capacity of the victim to detect or prevent
the crime, rather than with the quantity of harm suffered by
the victim. The latter aggravation is dealt with in five
other provisions of the guidelines, expressly permitting
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upward departures where the crime resulted in death,
significant physical injury, extreme psychological injury,
special property damage, or the gratuitous infliction of
injury or prolonging of pain or humiliation. U.S.S.G.
5K2.1, .2, .3, .5, .8. As United States v. Kaye, 23 F.3d 50,
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54 (2d Cir. 1994), explained:
[T]he courts appear to have interpreted
the phrase "susceptible to the criminal
conduct" as emphasizing that a particular
victim was less likely to thwart the
crime, rather than more likely to suffer
harm if the crime is successful.
Thus, the issue here is whether the patients at the two
mental health facilities where Gill practiced were, on
account of their condition, substantially less able than the
average citizen to protect themselves against Gill's fraud.
There is nothing in the presentence report or in the district
judge's comments that suggests a misunderstanding on this
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point. However, we stress the focus of the guideline at the
outset because one cannot measure degrees of vulnerability or
susceptibility without some notion of what kind of
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vulnerability or susceptibility is at issue.
Even thus narrowed, our case is peculiarly difficult
because Gill was dealing with a group, made up of individuals
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about whom we know almost nothing beyond the fact that they
fall into a class of persons, namely, those who visit mental
health centers for counseling and therefore are likely to
have or think they have some emotional or mental problem--
which may afflict the patient or a related non-patient. Gill
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argues that in such a case it is improper for a vulnerability
finding to be based on membership in a class rather than on
evidence as to a specific individual.
Appeals courts have been rather more willing to set
aside determinations of vulnerability made solely on a class
basis than when the focus was on the susceptibility of a
specific individual. United States v. Rowe, 999 F.2d 14, 16-
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17 (1st Cir. 1993). But, as we also said in Rowe, this is in
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no way a fixed rule. Id. at 17. In some cases the inference
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to be drawn from the class characteristics may be so powerful
that there can be little doubt about unusual vulnerability of
class members within the meaning of section 3A1.1.
The guideline makes clear that "class" determinations
are permissible by saying in its commentary that the
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adjustment would apply to someone who sold an ineffective
cancer cure. U.S.S.G. 3A1.1(b), comment. n.2. Numerous
cases have upheld upward adjustments based on group
determinations. See, e.g., United States v. Malone, 78 F.3d
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518, 522-23 (11th Cir. 1996) (cab drivers); Echevarria, 33
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F.3d at 180-181 (medical patients); United States v.
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McDermott, 29 F.3d 404, 411 (8th Cir. 1994) (black
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teenagers); United States v. Peters, 962 F.2d 1410, 1417-18
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(9th Cir. 1992) (people with poor credit histories);
Bachynsky, 949 F.2d at 735 (medical patients).
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In Rowe, the primary subjects of the fraud were business
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entities, and, without knowing more about any company, it was
hard for us to see how they were "unusually" vulnerable to
fraud. The more recent case of United States v. Feldman, 83
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F.3d 9 (1st Cir. 1996), also relied upon by Gill, is quite
different. There, this court was concerned with a crime
directed against only one or two specific victims. Id. at
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15-16. To resort to a single, class-based characteristic in
such a case is to prefer the less complete picture to a more
complete one readily available.
Yet even in a one-victim case, a single "class"
characteristic could be so powerful a proof of vulnerability
as to settle the issue without more. Indeed, the guideline
commentary suggests it would be enough to show that an armed
robbery victim was confined to a wheelchair. U.S.S.G.
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3A1.1(b), comment. n.2. In truth, many inferences about an
individual rest on an implicit generalization about a class.
Everything depends on the strength of the inference.
In our own case, the government could have simplified
matters if it had offered evidence from some of Gill's former
patients as to their own conditions. At the same time,
concerns about privacy and privilege make it pretty obvious
why the prosecutor might wish to avoid this course--quite
apart from considerations of time and expense. In all
events, the government was free to rest upon the inference
that many such patients would be highly vulnerable, leaving
it to the sentencing judge to agree or disagree.
In our view, a sentencing judge could reasonably
conclude based on general knowledge that, in the typical
situation, at least a fair number of patients at a community
mental health center are commonly under significant emotional
stress. True, some patients might be free of stress but to
suppose this to be generally true is unrealistic. Counseling
in mental health matters often involves disclosing affairs
that most people treat as private and, if for no other
reason, it is a step that many are likely to take only to
cope with substantial strains.
The records revealed that Gill had treated many
patients and that a number of them had multiple visits. It
is thus safe to infer that at least some of these victims
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were under significant stress and so unusually vulnerable to
Gill's fraud. It seems to us evident that Gill could foresee
the risk sufficiently to meet the guideline's "knew or should
have known" standard. Id. 3A1.1(b). See United States v.
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Skillman, 922 F.2d 1370, 1378 (9th Cir. 1990), cert. denied,
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502 U.S. 922 (1991).1
Ours would be a different case if Gill had seen only one
patient and we knew nothing about that individual. Yet a
different problem would be presented if Gill had accepted the
general inference as to most clinics but offered evidence
that his clinic treated only persons with a special problem
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unlikely to involve much patient stress. But neither of
these variations is presented, and there will be time enough
to deal with them, and many other variations, as cases arise.
Targeting. Gill makes a separate complaint that his
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section 3A1.1 enhancement was erroneously applied because he
did not "target" or select his victims because of their
unusual vulnerability. He cites several cases for the
proposition that this motivation is a additional requisite
element. Until November 1995, the commentary to section
3A1.1 stated that the section was applicable "where an
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1This contrasts with the situation, described by the
guideline commentary, in which one of many victims happens to
be vulnerable by some circumstance accidental in relation to
the fraud and largely unforeseen. U.S.S.G. 3A1.1(b),
comment. n.2 (enhancement not applicable to purveyor of
fraudulent securities to general public if one victim happens
to be senile).
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unusually vulnerable victim is made a target of criminal
activity by the defendant." U.S.S.G. 3A1.1, comment. n.1
(Nov. 1994).
This commentary language was deleted by the Sentencing
Commission in November 1995 to "clarif[y] the operation" of
section 3A1.1. U.S.S.G. App.C, Amend. 521, at 430 (Nov.
1995). But Gill's criminal conduct took place prior to the
amendment date. So, if the 1995 amendment did away with a
previously required element of targeting motivation, the
prior guideline might have to be followed under ex post facto
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principles. See U.S.S.G. 1B1.11; United States v.
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Prezioso, 989 F.2d 52, 53-54 (1st Cir. 1993).
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Gill's argument about targeting leans heavily on our
opinion in Rowe. The Rowe case involved a scheme to sell
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fraudulent health insurance policies to various small
businesses, that were not, in our opinion, shown to be
unusually vulnerable under section 3A1.1. Rowe, 999 F.2d at
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16-17. When the government said that some of the employee-
patients might have been unusually vulnerable--because once
insured they could not easily switch companies--we replied
that there was no "special targeting [by Rowe] of such
victims." Id. at 17.
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The confusion is understandable, and wholly of our own
making, but it does not help Gill. All that we meant was
that the case might have been different if the Rowe's fraud
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had involved direct dealings between Rowe and the employee-
patients whereby the success of his scheme had depended upon
the latter's vulnerability. See, e.g., Bachynsky, 949 F.2d
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at 735 (upholding enhancement against physician who submitted
false claims to insurers after seeing vulnerable patients).
In short, the reference to targeting in Rowe had nothing to
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do with laying down a separate and additional requirement
that the primary subject of the fraud be a "target," as well
as foreseeably vulnerable to an unusual degree.
Although the circuits are divided,2 such an additional
requirement of "targeting," even under the pre-amendment
guideline, is at odds with the evident purpose of the
guideline: to punish more severely conduct that is morally
more culpable and to protect such victims by adding more
deterrence. See, e.g., United States v. Brunson, 54 F.3d
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673, 676 (10th Cir.), cert. denied, 116 S. Ct. 397 (1995);
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United States v. Morrill, 984 F.2d 1136, 1137-38 (11th Cir.
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1993). Further, to require subjective motivation undermines
the guideline's own lesser scienter requirement, namely, that
the defendant "knew or should have known" of the victim's
unusual vulnerability.
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2Compare United States v. O'Brien, 50 F.3d 751, 755-56
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(9th Cir. 1995) (declining to impose a scienter requirement
of targeting beyond the "knew or should have known" standard)
with United States v. Holmes, 60 F.3d 1134, 1136 (4th Cir.
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1995) (discussing additional targeting requirement), and
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United States v. Smith, 39 F.3d 119, 124 (6th Cir. 1994)
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(adopting targeting requirement).
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In the present case, the main subjects of Gill's fraud
include both the patients with whom he dealt directly and
those third parties who were billed, such as insurance
companies. It is a reasonable, indeed compelling, inference
that the former include at least some who were unusually
vulnerable and were foreseeably so. That is enough under the
guideline, pre and post amendment, regardless of Gill's own
private motivation. If Rowe has confused matters, as
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apparently it has, we are happy to set the record straight.
Abuse of Position of Trust. Gill also argues that the
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district court erred in enhancing his sentence under U.S.S.G.
3B1.3. That section provides for a two-level enhancement
"if the defendant abused a position of public or private
trust . . . in a manner that significantly facilitated the
commission or concealment of the offense." U.S.S.G. 3B1.3.
Thus, the district court must first decide that the defendant
occupied a position of trust and then find that he used that
position to facilitate or conceal the offense. See United
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States v. Santiago-Gonzalez, 66 F.3d 3, 8 (1st Cir. 1995).
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Here the district court concluded that, at least "in
real life terms," Gill occupied a position of trust relative
to his counseling patients, and that Gill took advantage of
the patients' reliance on his claimed status as a
psychologist to further his fraud scheme. Gill challenges
both findings, claiming that he did not hold a position of
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trust as intended by the guideline, and that there was no
evidence that he abused his position.
Were Gill a duly licensed psychologist who used his
status as a mental health professional to perpetrate some
fraud or other crime upon his patients and their insurers,
there is no doubt that section 3B1.3's enhancement would
apply. "Effective psychotherapy . . . depends upon an
atmosphere of confidence and trust in which the patient is
willing to make a frank and complete disclosure of facts,
emotions, memories, and fears." Jaffee v. Redmond, 116 S.
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Ct. 1923, 1928 (1996). The guideline phrase "private trust"
readily describes the relationship of a psychologist vis a
vis his or her patients.
Gill argues that because he did not legitimately occupy
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the position of counselor, he did not "hold" that position
under section 3B1.3. This argument has persuaded at least
one other circuit. In Echevarria, 33 F.3d at 181, the Second
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Circuit reversed a section 3B1.3 enhancement on a defendant
who falsely held himself out as a physician, stating that
"[w]e do not believe that an imposter `holds' the position
that he purports to occupy within the meaning of this
commentary." It does not persuade us.
We appreciate that read literally, the guideline could
be taken to refer only to one who legally or legitimately
occupied a position of trust, presumably the usual case. But
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the threat that animates the guideline may as easily be
present where the position is occupied by an imposter. That
threat--illustrated by the lawyer who bilks a client out of
trust funds or the doctor who sexually abuses a patient--is
that wrongdoer's position facilitates the crime, reduces the
chance of detection, or both. See U.S.S.G. 3B1.3, comment.
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n.1.
The threat is equally present whether the lawyer or
doctor is fully licensed or is a pretender sporting a vest or
white coat and displaying a fake diploma. In both cases, the
wrongdoer is using the ostensible position to facilitate or
conceal the crime, just as Gill's extraction of payments was
facilitated by his claim to be a licensed counselor. Our own
cases have stressed the practical realities rather than legal
title in applying this adjustment.3 This is also the view of
the Tenth Circuit in United States v. Queen, 4 F.3d 925, 929-
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30 (10th Cir. 1993).
The district court here found that Gill did acquire, "in
real life terms . . . by virtue of his conduct" a position of
trust relative to his patients. "Trust" alone, of course, is
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3See United States v. Newman, 49 F.3d 19 (1st Cir. 1995)
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(section 3B1.3 enhancement upheld against a defendant who
defrauded a corporation that was under his actual control,
despite the fact that he had never properly obtained legal
authority over the corporation); cf. United States v.
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Innamorati, 996 F.2d 456, 489-90 (1st Cir.) (former registry
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police officer subject to enhancement if prior position
facilitated crime), cert. denied, 510 U.S. 955 (1993).
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not enough; there must also be a "position." But by
pretending, Gill effectively occupied the "position" so far
as the present guideline is concerned.
Affirmed.
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