U.S. v. King, 93-7380

• Citation: 21 F.3d 1302
• Decision Date: 14 April 1994
• Docket Number: No. 93-7380,93-7380
• Parties: UNITED STATES of America, Appellee, v. Robert L. KING, Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)

Page 1302

21 F.3d 1302

UNITED STATES of America, Appellee, v. Robert L. KING, Appellant.

No. 93-7380.

United States Court of Appeals Third Circuit.

Argued Dec. 10, 1993.

Decided April 14, 1994.

Harold E. Lucas, Jr. (argued), Harrisburg, PA, for appellant.

Wayne P. Samuelson, U.S. Atty., William A. Behe (argued), Asst. U.S. Atty., Harrisburg, PA, for appellee.

Before BECKER and NYGAARD, Circuit Judges, and YOHN, District Judge. ^*

OPINION OF THE COURT

YOHN, District Judge.

Defendant-appellant Robert L. King pleaded guilty to one count of receiving or possessing stolen United States savings bonds, a violation of 18 U.S.C. Sec. 641. At sentencing, King received a two-point offense level enhancement based upon the district court's determination that he was "an organizer, leader, manager, or supervisor" in the criminal activity to which he pleaded guilty. U.S.S.G. Sec. 3B1.1(c). His base offense level was also enhanced by four points pursuant to former sentencing guideline Sec. 2B1.2 upon the district court's conclusion that King was "in the business of receiving and selling stolen property." U.S.S.G. Sec. 2B1.2(b)(4)(A). ¹ On appeal, King challenges the district court's application of those guideline sections, contending that both of those conclusions were erroneous. For the reasons discussed herein, we will affirm the former ruling but reverse the latter and remand for resentencing.

I.

On or about August 14, 1991, approximately 220 $1,000 denomination United States Government savings bonds were taken from a home in Middletown, Pennsylvania, during the course of a burglary. Most of these bonds ended up in King's possession by the end of the following year. ² King's involvement with the stolen bonds was first discovered by the government on November 9, 1992, when FBI Special Agent Larry Van Loon received a tip from Don Chiarella, a confidential informant. Chiarella related that King told him that he (King) had the stolen bonds. ³ Chiarella said he informed King that he knew an individual in Philadelphia who would purchase the bonds for 20 cents on the dollar. That same day, Ben Renfro Stuart, King's co-defendant, delivered 20 $1000 denomination United States Government savings bonds to Chiarella at his place of business and advised him that the bonds had come from King. Chiarella then turned the bonds over to Van Loon, who determined that the bonds were among those stolen in the Middletown burglary.

On November 16, 1992, Van Loon and Chiarella--with the help of Gregory Taylor, an undercover agent with the Dauphin County Drug Task Force who would play the role of Chiarella's "source" from Philadelphia--set a trap for King. Chiarella and King agreed to meet on November 18, 1992, in the parking lot of a hotel. At this meeting King was to receive $4,000 for the 20 bonds that had already been delivered and was to transfer the remaining bonds in his possession to Chiarella, who would in turn provide them to Taylor.

On the 18th, Chiarella, King, and Stuart, all driving separate vehicles, arrived at the hotel parking lot. Stuart parked his car at a distance from the others. Taylor was introduced to King as Chiarella's "source" from Philadelphia--the individual who had received the 20 bonds previously delivered by Stuart to Chiarella. Taylor paid King $4,000 cash for the 20 bonds previously delivered and negotiated with King for the purchase of the remaining bonds. After these negotiations concluded, ⁴ King signalled Stuart, Stuart exited his car, walked across the parking lot to King's car, handed King a package containing 109 bonds that were later determined to be among those stolen in the Middletown burglary, and began to return to his car. Stuart was arrested as he made his way to his car, and King was arrested as he attempted to leave the parking lot with 109 stolen bonds and the $4,000 that Taylor had paid him. A recording made of the conversation between King and Taylor revealed that King had informed Taylor that he had another 75 $1,000 bonds to sell.

King pleaded guilty on January 19, 1993. ⁵ On May 21, 1993, the day of his sentencing hearing, King surrendered 76 bonds determined to be among those taken in the Middletown burglary to the FBI. At King's sentencing hearing, the district court set his base offense level at 14. It then adjusted the base offense level upward by two levels pursuant to Sec. 3B1.1(c) based upon the conclusion that King was an "organizer, leader, manager, or supervisor" of the scheme to sell the stolen bonds. It also adjusted the base level upward by four levels under Sec. 2B1.2(b)(4)(A) based upon a conclusion that King was "a person in the business of receiving and selling stolen property." King now appeals, challenging both enhancements.

II.

We have jurisdiction over King's appeal from the district court's judgment of sentence pursuant to 18 U.S.C. Sec. 3742(a) and 28 U.S.C. Sec. 1291. Our standard of review of a district court's decision to adjust a defendant's base offense level under the guidelines "depends on the mixture of fact and law necessary to that court's determination." United States v. Bierley, 922 F.2d 1061, 1064 (3d Cir.1990) (citation omitted). "Where the decision is grounded on an essentially factual basis, we defer to the district court's findings and reverse only for clear error [but] if the alleged error is legal, the issue should be reviewed de novo." Id.

A. The Sec. 3B1.1(c) Two-Point Enhancement

Section 3B1.1(c) of the sentencing guidelines provides for a two-point enhancement of a defendant's base offense level if he "was an organizer, leader, manager, or supervisor in any criminal activity other than [that which involves five or more participants or was otherwise extensive]." U.S.S.G. Sec. 3B1.1(c). King contends that the district court erred when it increased his offense level under Sec. 3B1.1(c) because not only did Chiarella mastermind the scheme to sell the bonds but also because Chiarella, as a government agent, was not a participant in the criminal offense over whom King could have exercised any control. See U.S.S.G. Sec. 3B1.1, comment. (n. 1) ("A person who is not criminally responsible for the commission of the offense (e.g., an undercover law enforcement officer) is not a participant."). Whatever the merits of these contentions may be, however, their focus on Chiarella completely ignores the district court's scrutiny of the extent of King's control over Stuart, his co-defendant.

The Presentence Report ("PSR"), whose factual findings the district court adopted, (see Appendix ("App.") at 34B), states that shortly after his arrest, Stuart told investigators that King had recruited Stuart to assist him in selling the stolen bonds and that King had directed Stuart to deliver the first batch of 20 bonds to Chiarella. (PSR p 8.) Moreover, according to Stuart, it was King who planned the mechanics of the exchange of bonds in the parking lot on November 18, 1993, instructing him to hold the bonds and to deliver them to King only after he had received a signal from King over a citizen band radio. (PSR p 9.) The PSR concluded that King was an "organizer/leader" in the criminal offense and recommended that he receive a two-point offense level enhancement pursuant to U.S.S.G. Sec. 3B1.1(c). (PSR p 19.)

At King's sentencing hearing the district court did not specifically state whether it agreed with the PSR's characterization of King as the "organizer/leader" of the scheme to sell the stolen bonds or instead saw him as a manager or supervisor in the criminal activity. Rather, it concluded that King was a "major player" in the scheme to sell the bonds, noting that:

[Although] Mr. Chiarella arranged for a means of disposing of these bonds, ... Mr. King set up the entire operation of first testing the situation by delivering a portion of them and then setting up the rather not complex but rather detailed plan for turning over the remaining bonds in the parking lot....

(App. at N.T. 16.) Because Sec. 3B1.1(c) provides for a two-level enhancement if the defendant acted as either an organizer or leader or alternately as a manager or supervisor, we will sustain the district court's decision to increase King's offense level under that section if there were sufficient factual grounds for the district court to have concluded that King acted in any of those roles. See U.S.S.G. Sec. 3B1.1, comment. (backg'd.) (noting the inclusiveness of Sec. 3B1.1(c)).

The direction and control of others is a recurrent theme in legal definitions of the terms "manager" and "supervisor." See, e.g., Black's Law Dictionary 960, 1438 (6th ed. 1990). ⁶ As noted above, the district court adopted the factual findings in the PSR that King recruited Stuart to assist him in the scheme to sell the stolen bonds, instructed him to deliver the first batch of 20 bonds to Chiarella and then later, at the meeting on November 18, 1992, directed him to hold 109 bonds and deliver them to King only upon King's signal. None of those factual determinations is clearly erroneous. Indeed, King does not seriously contest their validity. ⁷ Thus, even if Chiarella did, as King contends, mastermind the scheme to sell the bonds, that in no way detracts from the evidence that King directed Stuart's role in the scheme.

In fact, the district court specifically found that Chiarella arranged the means of disposing the bonds but that King set up both the initial delivery of 20 bonds and the later plan for turning over 109 bonds in the parking lot. We conclude from the evidence of King's control over Stuart in those two activities that King acted at least as a manager or supervisor, if perhaps not as an organizer or leader, in the scheme to sell the stolen bonds and the district court's conclusion was not legally erroneous. Accordingly, we will affirm the district court's decision to enhance King's offense level by two points under Sec. 3B1.1(c).

B. The Sec. 2B1.2(b)(4)(A) Four-Point Enhancement

Former...