United States v. Hymas
| Citation | 780 F.3d 1285 |
| Decision Date | 25 March 2015 |
| Docket Number | 13–30240.,Nos. 13–30239,s. 13–30239 |
| Parties | UNITED STATES of America, Plaintiff–Appellee, v. Aaron Michael HYMAS, Defendant–Appellant. United States of America, Plaintiff–Appellee, v. Tiffany Kim Hymas, Defendant–Appellant. |
| Court | United States Courts of Appeals. United States Court of Appeals (9th Circuit) |
OPINION TEXT STARTS HERE
Marcus R. Mumford (argued), Mumford PC, Salt Lake City, UT, for Defendants–Appellants.
Syrena C. Hargrove (argued) and Wendy J. Olson, Assistant United States Attorneys, Boise, ID, for Plaintiff–Appellee.
Appeal from the United States District Court for the District of Idaho, Edward J. Lodge, District Judge, Presiding. D.C. No. 1:12–cr–00045–EJL–1, D.C. No. 1:12–cr–00045–EJL–2.
Before: RICHARD R. CLIFTON, MILAN D. SMITH, JR., and ANDREW D. HURWITZ, Circuit Judges.
Aaron and Tiffany Hymas were each convicted, pursuant to plea agreements, of one count of wire fraud under 18 U.S.C. § 1343. Aaron 1 appeals his sentence of 24 months' imprisonment, contending that facts found by the district court in sentencing should have been subject to the clear and convincing standard of proof rather than the preponderance of the evidence standard that the district court applied, because of the disproportionate impact of those facts on the sentence that was imposed. We agree, in part, vacate that sentence, and remand to the district court for further proceedings. Both defendants also appeal the district court's orders requiring restitution. We affirm those orders.
Aaron and Tiffany Hymas are a married couple. They partially owned and ran two businesses in the housing industry, Crestwood Construction and OPM Enterprises. In order to acquire financing, the Hymases and their business partner developed a plan to borrow money to construct houses, sell them, and use the proceeds to pay off the loans, ideally leaving a profit.
It was alleged, however, that many of the mortgage loan applications submitted by the defendants from 2005 to 2007 were fraudulent. Indictments alleged that the Hymases made false statements related to their employment, employment income, and rental income in the applications for twenty loans. Five of the loan applications listed Aaron as the borrower, thirteen listed Tiffany, and two listed Allen Bollschweiler, the husband of Aaron's sister.
Both defendants pled guilty to one count of wire fraud pursuant to plea agreements that provided that the other counts would be dismissed. Specifically, each defendant pled guilty to a charge of wire fraud regarding a March 28, 2007 loan to Tiffany in the amount of $295,600, identified as Count Four in both indictments. In the plea agreements, the defendants admitted that identified statements “were false and material to the loan application, and that [he or she] knew that they were false at the time [he or she] made them or caused them to be made.” Each plea agreement specified certain statements that were made in the loan application though known to be false. Aaron's agreement, for instance, specified the following misrepresentations:
1) Tiffany Hymas was employed by OPM Enterprises with 2.6 years on the job.
2) Tiffany Hymas had base employment income of $42,500/month, plus commissions of $30,000/month for a total of $72,500/month.
3) Tiffany Hymas had gross rental income, as follows: $4,350/month on 6097 Moose Creek, Meridian, Idaho; $4,100/month on 5035 N. Spangle in Meridian, Idaho; $2,150/month on 7243 E. Hampshire Lane, in Nampa, Idaho; $4,000/month on 11 632 W. Hollandale in Boise, Idaho.
It was further agreed that the loan was funded based on the above misrepresentations.
A presentence report (“PSR”) was prepared for each defendant. For Aaron, the PSR calculated the total loss as $3,689,953.73. The loss attributed to the Count Four loan was $162,758.79. The rest represented losses allegedly suffered by lenders on other loans, including loans that were the subject of counts that were dismissed. Losses from these loans were included because other “relevant conduct,” separate from the specific activity that is the subject of the criminal conviction, may be considered in imposing a sentence. SeeU.S.S.G. § 1B1.3.
Adding the losses from other loans substantially increased the proposed Guidelines sentencing range calculated in the PSR. The base offense level for Aaron's conviction under the Sentencing Guidelines was 7, but the loss amount as determined in the PSR increased that level by 18, to a total of 25. Following a reduction of 3 levels for acceptance of responsibility, the PSR determined that Aaron's total offense level was 22. With a criminal history category of I, Aaron's Guidelines imprisonment range was 41 to 51 months.
Aaron filed objections to the PSR loss calculation. He contested the relevant conduct, the proper burden of proof, the number and identification of victims, and the loss amount for sentencing. He also contested the loss amount and the proper victims for restitution. The district court held a three-day evidentiary hearing to resolve the factual issues.
Following the hearing, the district court issued a written order. Although Aaron argued that the clear and convincing evidence standard applied, the court explicitly held that the burden of proof that applied was preponderance of the evidence. The court applied that standard to determine the total loss amount for the purpose of calculating Aaron's sentence, including losses from other loans as relevant conduct. The court found that Aaron Hymas had committed fraud in the nineteen other loan applications and that the total loss amount was $3,416,337.97, slightly less than the amount calculated in the PSR. The district court agreed with the PSR's calculation of the Guidelines imprisonment range as 41 to 51 months. The district court subsequently sentenced Aaron to 24 months in prison.
The amount of restitution proposed by the PSRs for each defendant was $2,891,866.34. Aaron's attorney specifically objected to that calculation, but Tiffany's did not. The district court ultimately ordered restitution in the amounts of $1,520,296.77 for Aaron and $667,505.42 for Tiffany.
As described above, the district court applied the preponderance of the evidence standard to calculate the total loss amount resulting from Aaron's relevant conduct. Aaron contests the district court's use of that standard, arguing that the clear and convincing standard should have been applied because the loss enhancements had a disproportionate impact on the length of his sentence.
District courts generally use the “preponderance of the evidence standard of proof when finding facts at sentencing, such as the amount of loss caused by a fraud.” United States v. Treadwell, 593 F.3d 990, 1000 (9th Cir.2010). The higher clear and convincing standard may apply, however, “when a sentencing factor has an extremely disproportionate effect on the sentence relative to the offense of conviction.” United States v. Mezas de Jesus, 217 F.3d 638, 642 (9th Cir.2000) (citing United States v. Restrepo, 946 F.2d 654, 659 (9th Cir.1991) (en banc)); see also Treadwell, 593 F.3d at 1000. Particularly “where a severe sentencing enhancement is imposed on the basis of uncharged or acquitted conduct, due process may require clear and convincing evidence of that conduct.” Treadwell, 593 F.3d at 1000.
Our precedents “have not been a model of clarity in deciding what analytical framework to employ when determining whether a disproportionate effect on sentencing may require the application of a heightened standard of proof.” United States v. Berger, 587 F.3d 1038, 1048 (9th Cir.2009). We have indicated that, “where the sentencing enhancements are based on ... the offense of conviction,” the preponderance of the evidence standard is sufficient. Id. (citing United States v. Harrison–Philpot, 978 F.2d 1520, 1524 (9th Cir.1992)) (internal quotation marks omitted). We have also held that “there is no bright-line rule for the disproportionate impact test;” instead, the court examines the “totality of the circumstances” using six factors first articulated in United States v. Valensia, 222 F.3d 1173 (9th Cir.2000) (“ Valensia factors”).2Berger, 587 F.3d at 1048 (citing United States v. Jordan, 256 F.3d 922, 928 (9th Cir.2001)) (internal quotation marks omitted).
Under the Valensia totality of the circumstances test, six factors, none of which is dispositive, guide the determination of whether a sentencing factor has a disproportionate impact on the sentence:
(1) whether the enhanced sentence falls within the maximum sentence for the crime alleged in the indictment; (2) whether the enhanced sentence negates the presumption of innocence or the prosecution's burden of proof for the crime alleged in the indictment; (3) whether the facts offered in support of the enhancement create new offenses requiring separate punishment; (4) whether the increase in sentence is based on the extent of a conspiracy; (5) whether an increase in the number of offense levels is less than or equal to four; and (6) whether the length of the enhanced sentence more than doubles the length of the sentence authorized by the initial sentencing guideline range in a case where the defendant would otherwise have received a relatively short sentence.
We separate our consideration of the loss enhancement here into two parts: (1) losses attributed to the loan that was the subject of Count Four of the indictment, to which Aaron pled guilty, and (2) losses attributed to the other loans.
Aaron pled guilty to Count Four of the indictment, which involved a loan in the amount of $295,600. Applying the preponderance of the evidence standard, the district court determined the loss to the lender on that loan to be $162,758.79. That loss, by itself, enhanced Aaron's total offense calculation under the Sentencing Guidelines by 10 levels. SeeU.S.S.G. § 2B1.1 (...
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