U.S. v. Alburay, 03-3848.

• Decision Date: 29 July 2005
• Docket Number: No. 03-3848.,03-3848.
• Citation: 415 F.3d 782
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Fayez ALBURAY, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 782

415 F.3d 782

UNITED STATES of America, Plaintiff-Appellee, v. Fayez ALBURAY, Defendant-Appellant.

No. 03-3848.

United States Court of Appeals, Seventh Circuit.

Argued February 17, 2005.

Decided July 29, 2005.

Thomas D. Shakeshaft (argued), Office of the United States Attorney, Chicago, IL, for Plaintiff-Appellee.

Richard H. Parsons, Johanna M. Christiansen (argued), Office of the Federal Public Defender, Peoria, IL, for Defendant-Appellant.

Before POSNER, RIPPLE, and MANION, Circuit Judges.

MANION, Circuit Judge.

Fayez Alburay ran a grocery store as well as a food stamp scam that defrauded the United States Department of Agriculture ("USDA") out of more than a million dollars. His scheme landed him in federal court, where he pleaded guilty to wire fraud, and in federal prison, where he is serving a fifty-one-month sentence. On appeal, he challenges his sentence, a condition of his supervised release, and the district court's $1,750,000 restitution award. We affirm the sentence but remand with instructions on the supervised release and restitution issues.

I.

Fayez Alburay owned and operated a neighborhood grocery — as it turned out, appropriately named the Shady Food Store — located at 11300 South Wentworth Avenue in Chicago, Illinois. Upon Alburay's application on behalf of his store, the USDA authorized Shady Food to operate under the federal food stamp program. Under the program, Shady Food accepted food stamps or the modern electronic equivalent thereof (collectively, "food stamps" or "stamps")¹ from food stamp recipients as payment for qualified food items such as fruit and vegetables (and not for such things as alcohol and tobacco products). On behalf of Shady Food, Alburay then redeemed the stamps by presenting them to a bank that would then credit the store with a cash deposit. The USDA would then reimburse the bank for the cash value of the stamps.

The food stamp program no doubt generated business volume that Shady Food may not have otherwise had. For Alburay, however, that increase was apparently not enough. He devised a scheme whereby he would accept food stamps in exchange for cash instead of qualified food items (cash that could then be used for anything). Alburay made these unlawful exchanges worth his while by paying less than the face value of the stamps. For example, someone would give Alburay $100 worth of stamps, and Alburay would return only $70 worth of cash. "Customers" apparently preferred the lower cash amount instead of the highervalued but restricted stamps. To complete the scheme, Alburay presented the unlawfully obtained stamps to the bank and received the full face value of the stamps, thereby fraudulently acquiring funds from the USDA. The scheme ran from 1996 to 1998, spanning twenty-five months.

Alburay's guilt in these matters is undisputed. After the government charged Alburay with nine criminal counts, he pleaded guilty to one count of wire fraud, 18 U.S.C. § 1343. In accordance with a written plea agreement, the other counts were dismissed. The dismissed charges were two additional counts of wire fraud, three counts of mail fraud, 18 U.S.C. § 1341, and three counts of food stamp fraud, 7 U.S.C. § 2024(c).

In the deal, the government and Alburay agreed that U.S.S.G. § 2F1.1(a) (1997) provided the appropriate base offense level for this case — six. They also agreed that the offense involved more than minimal planning, and, as a result, two more levels were added pursuant to § 2F1.1(b)(2)(A). In the agreement, the government stated that it believed that the amount of loss caused by the scheme ranged from $1,500,000 to $2,500,000, which would carry a twelve-level enhancement under § 2F1.1(b)(1)(M). Alburay, on the other hand, maintained that the loss figure was lower and reserved the right to argue the issue. Also, under the agreement, Alburay was on track for a three-level reduction for his acceptance of responsibility under U.S.S.G. § 3E1.1.

Nevertheless, Alburay's opportunity for an acceptance-of-responsibility reduction dissipated because, after pleading guilty and while on release pending sentencing, Alburay failed to appear for his sentencing hearing. The district court issued a fugitive warrant, and, several weeks later, he was arrested after a routine traffic stop in Elko, Nevada. Alburay, a citizen of Jordan, had obtained a passport under an alias and was apparently preparing to flee the United States to avoid his impending punishment. Alburay's detour was a costly mistake. At sentencing, the district court rejected the acceptance-of-responsibility reduction and added a two-level obstruction-of-justice enhancement for willfully failing to appear for sentencing in accordance with U.S.S.G. § 3C1.1.

As to the loss amount, the government submitted an analysis to the probation officer estimating the loss at $1,750,000, which the probation officer incorporated into her presentence investigation report. The district court adopted the $1,750,000 figure for purposes of sentencing and restitution. As indicated above, a loss amount of $1,750,000 equated to a twelve-level enhancement under § 2F1.1(b)(1)(M).

Additionally, Alburay moved for a downward departure based upon hardships resulting from his status as a deportable alien. See, e.g., United States v. Meza-Urtado, 351 F.3d 301, 304-05 (7th Cir. 2003). The district court, however, sua sponte entertained the idea of an upward departure, believing that Alburay's category I criminal history vastly understated his past conduct and that his past conduct coupled with his multiple aliases, social security numbers, and driver's licenses showed a serious disregard for the law. Balancing these considerations, the district court denied Alburay's motion and opted against an upward departure.

The bottom line was a total offense level of twenty-two (six for the base, two for more than minimal planning, twelve for the loss, and two for obstructing justice). With the category I criminal history, the sentencing range was forty-one to fifty-one months of imprisonment, and the district court sentenced at the top of the range. Alburay appeals the fifty-one-month sentence.

The district court also imposed three years of supervised release. At the sentencing hearing, the district court ordered a special condition of supervised release concerning deportation and re-entry into the United States. The text of the condition in the district court's written judgment, however, did not match up with what the district court had said on the record. Alburay appeals the discrepancy. Additionally, as mentioned above, the district court ordered $1,750,000 in restitution. Alburay also challenges that figure on appeal.

II.

A.

The basis of Alburay's sentencing challenge is United States v. Booker, ___ U.S. ___, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005). Under Booker, the formerly mandatory federal sentencing guidelines have become advisory. Id. at 767. A sentence violates the Sixth Amendment, according to Booker, when it exceeds the maximum sentence authorized through the facts established by a jury verdict or a guilty plea or by facts otherwise admitted to by the defendant. Id. at 756. Here, Alburay's plea authorized the base offense level as well as the enhancement for more than minimal planning. As to the rest, they were imposed as the result of judge-found facts under mandatory guidelines. Alburay's sentence thus runs afoul of the Sixth Amendment, as interpreted by Booker, because, under the mandatory guidelines, the sentence exceeded the maximum sentence authorized by the facts established by the plea and Alburay's admissions and concessions. Id. Alburay, however, did not raise this Sixth Amendment argument before the district court. The matter is therefore governed by the plain-error standard of review and our decision in United States v. Paladino, 401 F.3d 471 (7th Cir.2005).

After oral argument in this appeal, we ordered a limited remand, pursuant to Paladino, to ascertain whether the Sixth Amendment error was prejudicial. Id. at 483-85. Specifically, under the Paladino procedure, we retained jurisdiction over the appeal while ordering "a limited remand to permit the sentencing judge to determine whether he would (if required to resentence) reimpose his original sentence." Id. at 484. In our limited remand order, we postponed adjudication of Alburay's supervised release and restitution arguments until we received the district court's Paladino answer.

On limited remand, the district court first ordered each party to submit a memorandum presenting their positions on the matter. After reviewing the memoranda and the record at the time of sentencing, the district court then issued a statement ruling that, if required to resentence, it would reimpose the original fifty-one-month sentence. Given the district court's decision, Alburay cannot show prejudice. Id. at 483-84. Nonetheless, the district court's decision does not end all appellate review of the sentence. As we held in Paladino: "If [the district court determines that it would reimpose the original sentence], we will affirm the original sentence against a plain-error challenge provided that the sentence is reasonable, the standard of appellate review prescribed by Booker." Id. at 484 (citing Booker, 125 S.Ct. at 765). Therefore, we now turn to reasonableness, the "final component of the Paladino plain error equation." United States v. Mykytiuk, ___ F.3d ___, ___, 2005 WL 1592956 at *1 (7th Cir. 2005).

Pursuant to Booker, the reasonableness of a sentence is guided by the factors set forth in 18 U.S.C. § 3553(a). 125 S.Ct. at 765-66 ("Section 3553(a) ... sets forth numerous factors that guide sentencing. Those factors in turn will guide appellate courts ... in determining whether a sentence is unreasonable."). Among other items, these factors include the nature and circumstances of the offense, the history and characteristics of the defendant, the need for the sentence to reflect...