Filed: Sep. 01, 2017
Latest Update: Mar. 03, 2020
Summary: United States Court of Appeals For the Eighth Circuit _ No. 16-2797 _ United States of America, lllllllllllllllllllll Plaintiff - Appellee, v. Frantz Pierre, lllllllllllllllllllll Defendant - Appellant. _ Appeal from United States District Court for the District of Minnesota - St. Paul _ Submitted: February 10, 2017 Filed: September 1, 2017 _ Before LOKEN, COLLOTON, and KELLY, Circuit Judges. _ COLLOTON, Circuit Judge. Frantz Pierre appeals his convictions for conspiracy to defraud the governmen
Summary: United States Court of Appeals For the Eighth Circuit _ No. 16-2797 _ United States of America, lllllllllllllllllllll Plaintiff - Appellee, v. Frantz Pierre, lllllllllllllllllllll Defendant - Appellant. _ Appeal from United States District Court for the District of Minnesota - St. Paul _ Submitted: February 10, 2017 Filed: September 1, 2017 _ Before LOKEN, COLLOTON, and KELLY, Circuit Judges. _ COLLOTON, Circuit Judge. Frantz Pierre appeals his convictions for conspiracy to defraud the government..
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United States Court of Appeals
For the Eighth Circuit
___________________________
No. 16-2797
___________________________
United States of America,
lllllllllllllllllllll Plaintiff - Appellee,
v.
Frantz Pierre,
lllllllllllllllllllll Defendant - Appellant.
____________
Appeal from United States District Court
for the District of Minnesota - St. Paul
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Submitted: February 10, 2017
Filed: September 1, 2017
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Before LOKEN, COLLOTON, and KELLY, Circuit Judges.
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COLLOTON, Circuit Judge.
Frantz Pierre appeals his convictions for conspiracy to defraud the government
and money laundering, asserting that the district court1 erred by denying his motions
to suppress evidence and to dismiss the charges. He also argues that the district court
1
The Honorable Donovan W. Frank, United States District Judge for the
District of Minnesota.
committed procedural error in calculating an advisory sentencing guideline range
before imposing sentence. We conclude that there was no reversible error, and we
therefore affirm.
I.
Pierre and three co-conspirators were charged with conspiracy to defraud the
government and money laundering, in violation of 18 U.S.C. §§ 286 and 1957. The
conspirators used stolen social security numbers to submit fraudulent tax returns and
collect the refunds. Some of the victims were incarcerated in Florida when their
social security numbers were used to submit the tax returns.
The scheme began around July 2010, when Pierre registered a phony tax-
preparation business in Minnesota and opened bank accounts in the company’s name.
Pierre and his co-conspirators filed 98 fraudulent federal income-tax returns
requesting nearly $800,000 in refunds through that company. The IRS processed
many of the returns and deposited nearly $450,000 in the company’s account.
Pierre then recruited co-conspirators to register more phony tax-preparation
businesses and open corresponding bank accounts. Pierre and the co-conspirators
submitted at least 770 tax returns requesting more than $5.2 million in refunds. The
IRS processed over 200 of these returns and paid more than $1.2 million before the
fraud was discovered. Pierre and his co-conspirators were indicted in Minnesota in
May 2013.
Eight months earlier, Pierre and another set of co-conspirators were charged
with a similar tax conspiracy in the Southern District of Florida. In this scheme,
Pierre and his Florida co-conspirators agreed to use stolen social security numbers to
file fraudulent tax returns, direct the IRS to deposit the tax refunds onto debit cards,
and then withdraw the refunds. The Florida indictment charged Pierre and his co-
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conspirators with conspiracy to defraud the United States, use of unauthorized access
devices (i.e., debit cards) and conspiracy to use them, and aggravated identity theft.
The indictment also charged Pierre with possession of fifteen or more unauthorized
access devices (i.e., social security numbers). The jury convicted Pierre on all counts,
and the Florida district court sentenced him to 208 months in prison. United States
v. Pierre, 825 F.3d 1183, 1191 (11th Cir. 2016).
After Pierre was charged in Minnesota, he moved to suppress certain bank
records and to dismiss the conspiracy charge. Pierre argued that the government
violated the Fourth Amendment and the Right to Financial Privacy Act when it
obtained Pierre’s bank records via grand jury subpoenas. The district court denied
the motion on the grounds that Pierre lacked standing to bring the Fourth Amendment
challenge and that the Right to Financial Privacy Act does not authorize the
suppression of evidence.
In his motion to dismiss the conspiracy count, Pierre claimed that the Double
Jeopardy Clause prevented the prosecution in Minnesota, because the Minnesota and
Florida conspiracies were actually a single conspiracy for which he had already been
prosecuted in Florida. After the district court denied Pierre’s motion, Pierre brought
an interlocutory appeal. This court affirmed, concluding that the government had
shown by a preponderance of the evidence that the two indictments charged separate
conspiracies. United States v. Pierre, 795 F.3d 847, 852 (8th Cir. 2015).
Pierre then pleaded guilty to both counts of the Minnesota indictment. Pierre
proceeded pro se and renewed the motion to dismiss on the double-jeopardy ground.
He argued that excerpts from government filings in the Minnesota and Florida cases
after the first appeal demonstrated that the two indictments charged a single
conspiracy. The district court denied Pierre’s renewed motion.
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At sentencing, the district court calculated a total offense level of 33 under the
sentencing guidelines. That total offense level included a two-level increase for a
vulnerable victim, a two-level increase for sophisticated means, a two-level increase
for an offense involving ten or more victims, an 18-level increase for an intended loss
of more than $5.2 million, and a four-level increase for an aggravating role in the
offense. With a criminal history category of IV, Pierre’s advisory guideline range
was 188 to 235 months’ imprisonment. The court sentenced Pierre to 210 months’
imprisonment, with all but 36 months to run concurrently with the Florida sentence.
II.
Pierre argues first that the district court erred by denying his motion to suppress
his financial records, and by denying his motion to dismiss the indictment on double-
jeopardy grounds. A valid guilty plea, however, waives all suppression issues not
expressly reserved by a conditional plea, United States v. Freeman, 625 F.3d 1049,
1052 (8th Cir. 2010), and waives a defendant’s “independent claims relating to the
deprivation of constitutional rights that occurred prior to” pleading guilty, Tollett v.
Henderson,
411 U.S. 258, 267 (1973). This waiver covers Pierre’s claim for
suppression of evidence based on the statute or the Constitution.
The valid guilty plea also bars an appeal based on double jeopardy, unless “the
face of the record” at the time the plea was entered shows that the district court did
not have the power to enter the second conviction or to impose sentence. United
States v. Broce, 488 U.S. 563, 569, 575-76 (1989). The indictment in the Minnesota
case describes on its face a conspiracy that is separate from the conspiracy in Florida.
United States v. Pierre,
795 F.3d 847, 849-52 (8th Cir. 2015). Pierre also relies on
statements made by the government in court documents filed after the first appeal.
Assuming that Pierre did not waive reliance on materials other than the indictments
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by pleading guilty, cf. United States v. Quinones, 906 F.2d 924, 927 (2d Cir. 1990),
these court documents do not establish a violation of double jeopardy.
Pierre first cites a sentence from government’s briefs in his Eleventh Circuit
appeal stating that the “overall scheme” spanned at least from 2010 to 2012, and was
moved to Minnesota after it was uncovered in south Florida. The phrasing is
imprecise, but it is not inconsistent with the existence of two separate conspiracies
that constituted what the government attorney called the “overall scheme.” The
brief’s reference to the period “from 2010 to 2012” does not say that both
conspiracies were underway during that entire period.
Pierre also points to two comments from the government’s sentencing brief
concerning one of Pierre’s Minnesota co-defendants. In the first, the government
remarked that the co-defendant participated in a “large, multi-state tax fraud scheme.”
The reference to multiple States is not inconsistent with a separate conspiracy charged
in Minnesota; that offense involved some actions (such as filing of tax returns) that
were taken in Florida. See Pierre, 795 F.3d at 851. Pierre also cites the
government’s references to “Pierre and a group of Miami-based co-conspirators”
illegally obtaining social security numbers, and “Pierre and other co-conspirators”
using those numbers to prepare and file fraudulent tax returns. This discussion is not
inconsistent with the government’s theory of separate conspiracies: Pierre and his
Florida-based co-conspirators acquired the social security numbers, while Pierre and
his Minnesota-based co-conspirators used the numbers to file fraudulent tax returns
by opening phony tax-preparation businesses and bank accounts in Minnesota.
The face of the record does not show that Pierre’s prosecution in Minnesota
placed him in jeopardy for the same offense twice. His double-jeopardy claim
therefore fails or is barred by his guilty plea.
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III.
Pierre also raises five challenges to his sentence. We review the district court’s
interpretation and application of the guidelines de novo and its factual findings for
clear error. United States v. Petruk, 836 F.3d 974, 976 (8th Cir. 2016).
First, Pierre argues that the district court erred when it applied an increase for
a vulnerable victim. USSG § 3A1.1(b)(1) calls for a two-level increase if the
defendant knew or should have known that a victim of the offense was a vulnerable
victim. A vulnerable victim includes a person who is “otherwise particularly
susceptible to the criminal conduct.” USSG § 3A1.1, comment. (n.2).
The district court did not clearly err when it found that Pierre’s incarcerated
victims were vulnerable. The evidence supported a finding that Pierre knew or
should have known that incarceration made them particularly susceptible to others
using their identities to procure fraudulent tax refunds. Pierre complains that a
vulnerable victim is a “person,” USSG § 3A1.1, comment. (n.2), while incarcerated
victims are a “class of persons,” and he argues that the increase was thus
unwarranted. But that the same circumstance made all incarcerated victims
vulnerable does not make the adjustment inapplicable. Pierre also points out that not
all of the victims were incarcerated, but the increase applies as long as one or more
victims was vulnerable. United States v. Anderson, 440 F.3d 1013, 1017 (8th Cir.
2006).
Pierre also objects that the court applied both a vulnerable-victim adjustment
and an increase for use of sophisticated means under § 2B1.1(b)(10)(C). The
guidelines do not forbid the court to apply both enhancements. The former was based
on Pierre targeting vulnerable inmates; the latter applied because Pierre carried out
his scheme by creating fictitious companies and bank accounts to fool the IRS into
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believing the co-conspirators were receiving legitimate tax refunds on behalf of
customers. See USSG § 2B1.1, comment. (n.9(B)). And any error was harmless,
because the court specifically found that even if the vulnerable-victim increase did
not apply, the court would have imposed the same sentence based on the factors set
forth in 18 U.S.C. § 3553(a). See United States v. Thigpen, 848 F.3d 841, 844 (8th
Cir. 2017).
Pierre’s four remaining sentencing arguments are based on his theory that his
Minnesota sentence inappropriately punished conduct that was already taken into
account in his Florida sentence. Pierre contends that the Minnesota district court
impermissibly double-counted when it imposed a two-level increase for ten or more
victims, see USSG § 2B1.1(b)(2)(A), and when it imposed an 18-level increase for
intended loss based on the 770-plus social security numbers used to file the fraudulent
tax returns through Minnesota companies, see USSG § 2B1.1(b)(1)(J). According to
Pierre, because the Florida district court included $1 million in loss for Pierre’s illegal
possession of 2,000 social security numbers when calculating his offense level, the
Minnesota district court was precluded from sentencing Pierre based on his use of
more than 770 of those social security numbers as part of the Minnesota conspiracy.
We reject this contention because Pierre’s sentences in the two jurisdictions reflect
enhancements for separate crimes: the Florida court enhanced his sentence for
illegally possessing the 2,000 or more social security numbers, while the Minnesota
court enhanced his sentence based on the intended loss and the ten or more victims
from Pierre illegally using more than 770 of the numbers to file fraudulent tax returns.
Pierre also complains that the district court created unwarranted sentencing
disparities when it sentenced him based on intended loss ($5.2 million) rather than
actual loss ($1.2 million), because his co-conspirators received sentences based on
the actual loss amount attributable to them. The guidelines direct the court to
consider the greater of actual loss or intended loss, USSG § 2B1.1, comment.
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(n.3(A)), so there was no error in using the larger amount. The statutory direction to
avoid unwarranted disparities among defendants, 18 U.S.C. § 3553(a)(6), refers to
national disparities, not differences among co-conspirators, so Pierre’s argument
founders on a mistaken premise. See United States v. Fry, 792 F.3d 884, 892-93 (8th
Cir. 2015). In any event, any disparity among co-conspirators here was warranted by
Pierre’s greater culpability in the conspiracy. Pierre was aware of the full scope of
the conspiracy: he recruited co-conspirators to open several phony tax-preparation
companies and bank accounts, and he directed them to deposit and withdraw money
from the bank accounts. Most of the co-conspirators were associated with only a
single fictitious company and bank account. The district court reasonably sentenced
Pierre based on a greater amount of loss.
Finally, Pierre argues that his entire sentence in the Minnesota case should
have run concurrently with the remainder of his undischarged term of imprisonment
in the Florida case. He relies on USSG § 5G1.3(b), which says that if the Florida
sentence resulted from an offense that is “relevant conduct” to the Minnesota offense,
then the terms of imprisonment should run concurrently. As it pertains to Pierre’s
convictions, relevant conduct includes “all acts and omissions . . . that were part of
the same course of conduct or common scheme or plan as the offense of conviction.”
USSG §§ 1B1.3(a)(2), 3D1.2(d).
The probation office recommended that § 5G1.3(b) was not applicable, because
the Florida offense conduct was not relevant conduct in the Minnesota conspiracy.
The presentence report observed that the Florida case did not include the losses in the
Minnesota case or the money laundering conduct and that the two conspiracies did
not occur in the same time frame. The district court adopted the presentence report.
At the hearing, the district court stated that the sentence was “consistent with the
§ 3553(a) factors, provided that I break that down and direct that all but 36 months
of it be run concurrent with the Florida sentence.”
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The district court did not clearly err in finding that at least some of Pierre’s
conduct in the Florida case was not relevant conduct to the Minnesota conspiracy.
In any event, the court was not bound to follow the recommendation of § 5G1.3, and
the court made clear that its decision to run 36 months of the term consecutively to
the Florida sentence was based on § 3553(a). Given the separate harm arising from
the Minnesota conspiracy, this decision was not an abuse of discretion.
* * *
For the foregoing reasons, the judgment of the district court is affirmed.
KELLY, Circuit Judge, concurring.
Our court has not previously decided whether “[t]he statutory direction to avoid
unwarranted disparities among defendants [in accordance with] 18 U.S.C.
§ 3553(a)(6) refers to national disparities [rather than] differences among co-
conspirators.” Supra at 8. See Fry, 792 F.3d at 892–93 (noting in dicta that “[m]ost
courts say that the statutory direction to avoid unwarranted sentence disparities, see
18 U.S.C. § 3553(a)(6), refers to national disparities, not differences among co-
conspirators” but affirming defendant’s longer sentence as substantively reasonable
when compared to sentences of other participants in fraud scheme because “disparate
sentences among dissimilar defendants are not unwarranted”) (emphasis omitted);
United States v. Nshanian,
821 F.3d 1013, 1019 (8th Cir. 2016) (citing
Fry, 792 F.3d
at 892, but nonetheless “[a]ssuming for the sake of analysis that the statutory
direction to avoid unwarranted sentence disparities might refer to differences among
co-conspirators rather than national disparities”); United States v. Avalos,
817 F.3d
597, 602 (8th Cir. 2016) (citing
Fry, 792 F.3d at 892–93, but “assuming for the sake
of analysis that sentence disparities among co-conspirators could demonstrate
unreasonableness”). In my view, there is no need to do so here, because any disparity
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between Pierre’s sentence and those of his co-conspirators was warranted for the
reasons stated by the court. For this reason, I concur in the result, but not in the
conclusion regarding the proper scope of § 3553(a)(6). I otherwise concur in the
court’s opinion.
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