U.S. v. Ellerbee

• Decision Date: 16 January 1996
• Docket Number: No. 94-2278,94-2278
• Citation: 73 F.3d 105
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. John L. ELLERBEE, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 105

73 F.3d 105

UNITED STATES of America, Plaintiff-Appellee, v. John L. ELLERBEE, Defendant-Appellant.

No. 94-2278.

United States Court of Appeals Sixth Circuit.

Submitted Oct. 13, 1995.

Decided Jan. 16, 1996.

Stephen L. Hiyama, Asst. U.S. Attorney (briefed), Detroit, MI, for U.S.

Joan E. Morgan (briefed), Detroit, MI, for John L. Ellerbee.

Before: KENNEDY and MOORE, Circuit Judges; POTTER ^*, District Judge.

POTTER, D.J., delivered the opinion of the court, in which MOORE, J., joined. KENNEDY, J. (pp. 109-110), delivered a separate concurring opinion.

JOHN W. POTTER, District Judge.

Defendant/appellant appeals his criminal conviction and sentencing. Defendant, after a bench trial, was convicted of mail fraud, 18 U.S.C. 1341; using fictitious names to further a scheme to defraud, 18 U.S.C. 1342; and the interstate transportation of property taken by fraud, 18 U.S.C. 2314. The district court sentenced Ellerbee to a term of 24 months incarceration.

On appeal, oral argument was waived and this case was heard on the briefs. Appellant argues: (1) that the evidence presented at trial was insufficient as a matter of law to support a finding of guilt; (2) that the evidence presented was insufficient to support the District Court's finding, made at the sentencing phase that appellant engaged in "more than minimal planning" in order to support a two-level sentence enhancement; (3) that the trial court committed error by failing to depart downward in the sentencing guidelines due to Ellerbee's argued "minor role" in the mail fraud; and (4) that the trial court committed error in adopting a retail valuation of the goods in question in order to determine the "fair market value" required to determine appellant's sentence. For the following reasons, we affirm the conviction and sentence.

From the evidence presented at trial, viewed in the light most favorable to the prosecution, the following is a brief summary of the relevant facts. Ellerbee essentially ran a scheme whereby he would, under numerous false names, sign up with the Columbia House Record Club. As part of Columbia's "introductory offer" the club typically offered incentives to join, such as allowing the subscriber to purchase eight tapes, albums or CDS for one cent. The member was then obligated to purchase a minimum number (usually 6 or 8) items at regular price from the Club over the next two to three years. After receiving the free tapes (which he later resold on the street), Ellerbee would then refuse the later invoices that were sent to the false name at the addresses he utilized.

Appellant used his own address, 13303 East Canfield; that of his step-daughter, 4720 Coplin; or a third address, 4325 Eastlawn, for the deliveries. The addresses were all subdivided into nonexistent apartments, and the names were picked at random from the telephone book. Appellant submitted a total of 221 false membership applications 208 of the applications were from Ellerbee's address, five bore the Coplin address, and eight bore the Eastlawn address. As a result of the applications, Columbia House sent 1811 CDS and 506 cassettes to the Coplin and Canfield addresses. ¹

The total value of the items sent to the Canfield and Coplin addresses was placed at $31,670.00. This amount was reached from testimony by a Columbia employee, Margaret Ames, which placed a general value of $15.00 per CD and $10.00 per tape on the merchandise. Ms. Ames was unable, however, to testify as to who in Columbia House actually determined these figures or how they were determined.

In order to convict the appellant of mail fraud, the government had to establish the following elements:

1. the existence of a scheme to defraud;

2. use of the mail in furtherance of the scheme; and

3. culpable participation by the accused.

See 18 U.S.C. Sec. 1341. The evidence presented is reviewed in the light most favorable to the prosecution, and the trial court's findings reversed only if the trial court's findings were "clearly erroneous." United States v. Bashaw, 982 F.2d 168 (6th Cir.1992).

Appellant's theory is that he was only a dupe in the scheme, whose master mind was an individual known only as "Derrick"; Derrick supposedly ran the operation and paid appellant only one dollar per tape. Appellant argues that since there is only equivocal circumstantial evidence of his guilt and no direct evidence, there was insufficient evidence to support his conviction. To support this proposition appellant relies on the case of United States v. Leon, 534 F.2d 667 (6th Cir.1976). The holding in this case is no longer good law. See United States v. Stone, 748 F.2d 361 (6th Cir.1984); ² see also Jackson v. Virginia, 443 U.S. 307, 318-19, 99 S.Ct. 2781, 2788-89, 61 L.Ed.2d 560 (1979). In Jackson, the Supreme Court held that in determining the sufficiency of evidence to support a criminal conviction "the relevant question is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt." Jackson, 443 U.S. at 318-19, 99 S.Ct. at 2789.

Ellerbee's reliance on Leon is therefore misplaced, and his subsequent argument and interpretation of the evidence is therefore baseless. The evidence viewed in the light most favorable to the prosecution, as related above, adequately supports Ellerbee's conviction.

Appellant also argues that "spillover" evidence unfairly biased the trier of fact, and that no proof was presented as to his specific intent to defraud. Both of these arguments actually pertain to the sufficiency of the evidence and, as discussed, above are without merit.

Appellant next argues that, at the sentencing phase of his trial, the district court erroneously found that appellant engaged in "more than minimal planning." This finding supported a two-level sentence enhancement. The trial court in sentencing may increase a convicted appellant's offense level by two points if the offense involved "more than minimal planning." U.S.S.G. Sec. 2B1.1(b)(5). The appropriate standard of review of the trial court's finding of "more than minimal planning" in this instance is one of clear error. United States v. Eve, 984 F.2d 701 (6th Cir.1993).

Appellant argues that "more than minimal planning" means more planning than is necessary to commit the offense in its simplest form. See U.S.S.G. Sec. 1B1.1, Commentary. Ellerbee maintains that "more than typical planning" would include creating dummy corporations, multiple bank accounts, etc. The argument follows that, since all appellant did was fill out applications, the upward enhancement is improper.

Ellerbee's argument lacks merit. More than minimal planning does not require that the offense be committed in its most complicated form, as appellant impliedly argues; rather it just must be something more than the crime in its simplest form. "More than minimal planning" can be deduced by more planning than is typical, repeated acts, and steps to conceal the crime. In this instance, appellant committed the crime through filling out over two hundred applications (repeated acts), used false names and addresses (concealment), and picked over two hundred false names out of the telephone book (more than minimal planning). The evidence indicates that the enhancement was warranted.

Further, as pointed out by the government, one of the comments in the sentencing guidelines is particularly germane: "[m]ore than minimal planning is [also] deemed present in any case involving repeated acts over a period of time, unless it is clear that each instance was purely opportune...." U.S.S.G. Sec. 1B1.1 comment n. 1(f) (emphasis added). See also United States v. Ivery, 999 F.2d 1043 (6th Cir.1993). As stated, this scheme involved repeated acts over 12 months, and each instance was as a result of the fraud-inducing efforts by the appellant, rather than being merely "opportune." The district court's finding that Ellerbee's offense involved more than minimal planning was proper.

With respect to his sentencing, appellant also argues that the district court committed error by failing to depart downward in the sentencing guidelines due to Ellerbee's argued "minor role" in the mail fraud. Ellerbee argues that he was only a small player in a larger scheme and that the mysterious Derrick was actually the criminal mastermind behind the plot to defraud Columbia House. This argument is totally without merit, and appears to be a repeat of Ellerbee's argument concerning the sufficiency of the evidence. Furthermore, appellant did not raise this issue before the district court. Ordinarily, this Court declines to address issues not raised in the court below. See United States v. Nagi, 947 F.2d 211, 212-13 (6th Cir.1991). At best, the Court, would review for plain error. The evidence presented, reviewed in the light most favorable to the prosecution, shows that appellant was the major, if not sole, participant in the fraud scheme. The district court's failure to depart downward was not plain error.

The most interesting of appellant's assigned errors is his contention that the district court erred in calculating the amount of loss by adopting a retail valuation of the goods in question in order to determine the "fair market value" required to determine Ellerbee's sentence. The court's standard of review in this instance is also one of clear error. United States v. Kohlbach, 38 F.3d 832 (6th Cir.1994).

As the Sentencing Guidelines require that the amount of loss attributable to Ellerbee's fraud be taken into account in determining the pertinent sentencing range, U.S.S.G. Sec. 2F1.1(b)(1), the Court must look to the meaning of "loss." Section 2B1.1, comment n. 2 of the Sentencing Guidelines defines "loss" as "the value of the property taken, damaged or destroyed." Ordinarily, when property is taken or destroyed the loss is the fair market value of the particular property at issue. Appe...