U.S. v. Charon

• Decision Date: 10 March 2006
• Docket Number: No. 05-10360.,05-10360.
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Iraelio CHARON, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

442 F.3d 881

UNITED STATES of America, Plaintiff-Appellee, v. Iraelio CHARON, Defendant-Appellant.

No. 05-10360.

United States Court of Appeals, Fifth Circuit.

March 10, 2006.

COPYRIGHT MATERIAL OMITTED

Charles William Brown, Dallas, TX, for Plaintiff-Appellee.

Peter Michael Fleury, Asst. Federal Public Defender, Fort Worth, TX, for Defendant-Appellant.

Appeal from the United States District Court for the Northern District of Texas.

Before KING, SMITH and BENAVIDES, Circuit Judges.

KING, Circuit Judge:

Defendant-appellant Iraelio Charon appeals his sentence, arguing that: (1) the district court erred by using relevant conduct to calculate his base offense level under U.S. SENTENCING GUIDELINES MANUAL § 2S1.1(a)(1) (2004) [hereinafter U.S.S.G.]; (2) the district erred by enhancing his sentence for sophisticated laundering under U.S.S.G. § 2S1.1(b)(3); and (3) the application of Justice Breyer's remedial holding in United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005), violates the Ex Post Facto and Due Process Clauses. For the following reasons, we AFFIRM.

I. FACTUAL AND PROCEDURAL BACKGROUND

In March 2003, a confidential source told special agents with the Drug Enforcement Administration ("DEA") in Dallas, Texas that Iraelio Charon was selling cocaine in the Fort Worth, Texas area. The agents' investigation revealed that on September 13, 1985, Charon was convicted in federal district court of conspiracy to distribute cocaine, in violation of 21 U.S.C. § 846.¹ Agents arranged for an informant to purchase cocaine from Charon. Several transactions occurred between the informant and Charon, in which the informant would purchase a substance containing a detectable amount of cocaine from Charon.² The transaction on December 19 2003, when Charon sold approximately 995 grams of cocaine to the informant, formed the basis for count one of the information.

The investigation further revealed that on September 18, 2002, Charon purchased property located at 2622 Edgewood Terrace in Fort Worth. As a down payment on the property, Charon tendered a cashier's check in the amount of $20,000. The cashier's check was purchased for Charon by a third party in the third party's name. Charon provided the funds for the cashier's check from drug proceeds. As stipulated by the parties in the factual resume, this property transaction was designed to allow Charon to make a legitimate investment using drug proceeds, while concealing the source of the funds. This conduct formed the basis for count two of the information, which alleged that Charon conducted a financial transaction involving drug proceeds.

On October 28, 2004, Charon was charged by an information filed by the government with one count of distributing more than five hundred grams of a mixture and substance containing cocaine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B), and one count of laundering of monetary instruments, in violation of 18 U.S.C. § 1956(a)(1)(B)(i). On November 12, 2004, Charon waived prosecution by indictment and consented to proceed by the two-count information. That same day, Charon pleaded guilty to both counts pursuant to a written plea agreement.

In the Presentence Report ("PSR"), the probation officer noted that Charon was convicted of two counts that required grouping under U.S.S.G. §§ 3D1.1 and 3D1.2(d). Because the money laundering offense produced the higher offense level, the probation officer used it to calculate the base offense level. See U.S.S.G. § 3D1.3(b) (providing that when counts involve offenses of the same general type to which different guidelines apply, the offense guideline that produces the highest offense level applies). The probation officer determined that the base offense level for the money laundering offense should be determined by using the underlying offense from which the laundered funds were derived, as well as specific offense characteristics. See id. § 2S1.1(a)(1). Because the laundered funds were derived from Charon's cocaine distribution business, the probation officer used U.S.S.G. § 2D1.1, which determines the base offense level using the drug quantity table, to come up with a base offense level of 36. See id. § 2D1.1(c)(2) (indicating a base offense level of 36 for an offense involving at least fifty kilograms but less than 150 kilograms of cocaine).³ The probation officer added two levels to arrive at a base offense level of 38 after adjusting for Charon's possession of a firearm. See id. § 2D1.1(b)(1).

After arriving at a base offense level of 38, the probation officer added two points because Charon was convicted under 18 U.S.C. § 1956, see id. § 2S1.1(b)(2)(B), and added another two points because the offense involved sophisticated money laundering, see id. § 2S1.1(b)(3). The probation officer then subtracted three points for Charon's acceptance of responsibility pursuant to U.S.S.G. § 3E1.1(a)-(b). Based on these adjustments, the probation officer recommended a total offense level of 39. With Charon's criminal history category of VI, the recommendation resulted in a guideline imprisonment range of 360 months to life. The probation officer noted, however, that the maximum term of imprisonment that may be imposed for count two is 240 months. See 18 U.S.C. § 1956(a)(1).

Charon filed written objections to the PSR, disputing the probation officer's calculation of the base offense level under U.S.S.G. § 2S1.1(a)(1) and the two-level enhancement for sophisticated laundering under U.S.S.G. § 2S1.1(b)(3). First, he argued that his base offense level should have been based solely on the drugs underlying his money laundering conduct, rather than his total amount of relevant conduct for drug dealing. Second, he contended that his method of purchasing the property was not a sophisticated laundering transaction and that the enhancement under U.S.S.G. § 2S1.1(b)(3) was therefore improper.

In an addendum to the PSR, the probation officer maintained that the base offense level of 38 was applicable and that the enhancement for sophisticated laundering was appropriate. With regard to Charon's objection to the base offense level, the probation officer noted that Charon was convicted of distribution of cocaine, as well as the money laundering offense. According to the probation officer, "[t]he base offense level is determined by using the underlying offense, [d]istribution of [c]ocaine and all relevant conduct, from which the laundered funds were derived (the defendant's cocaine trafficking business)." The probation officer also noted that the relevant conduct provisions do not limit the drug quantities to that stipulated by the defendant in his factual resume.

In response to Charon's objection to the enhancement under U.S.S.G. § 2S1.1(b)(3), the probation officer stated that

sophisticated laundering typically involves the use of two or more levels (i.e., layering) of transactions, transportation, transfers, or transmissions, involving criminally derived funds that were intended to appear legitimate. In this case, the defendant was a drug dealer and he regularly engaged in laundering his criminal proceeds by: opening various checking and/or money-marketing accounts and making cash deposits; using his wife to open an account in her name, and making unexplained cash deposits; asking a third person to purchase a cashier's check and purchasing property with the cashier's check to disguise the criminal proceeds.... The defendant's actions constitute "layering" within the meaning of [U.S.S.G.] § 2S1.1.

Charon objected to the addendum, reurging his objections and adding an objection based on United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005). He argued that after Booker, his base offense level could not be determined based on information not alleged in the information, admitted to by him, or proven to a jury beyond a reasonable doubt. He also contended that the Ex Post Facto and Due Process Clauses prohibit the district court from applying Booker's remedial opinion to his case.

At sentencing, the district court overruled Charon's objections to the PSR and his objections based on Booker.⁴ In doing so, the district court specifically adopted as the fact findings and conclusions of the court the facts and conclusions as set forth in the PSR and the addendum to the PSR. The district court also found that Charon had provided substantial assistance to the government and granted the government's motion for downward departure. In considering the advisory nature of the Guidelines, the court stated:

Well, I am going to take into account the defendant's cooperation with the government. Of course, I'm also taking into account his serious criminal history and his extensive drug activity in this case. Actually, his conduct, as reflected by the presentence report, would establish a mandatory life sentence if he had actually been convicted of his offense conduct.... I'm going to give him a significant departure below the bottom of the advisory guidelines.

The district court sentenced Charon to 240 months in prison, eight years of supervised release, and a $200 mandatory special assessment. In doing so, the court noted that it was departing ten years below the advisory guideline minimum of 360 months. The district court judge further stated that he believed the sentence he was imposing "takes into account and properly considers all of the factors that are mentioned in Title 18, United States Code, Section 3553."

Charon now appeals, arguing that: (1) the district court erred by using relevant conduct to calculate his base offense level under U.S.S.G. § 2S1.1(a)(1); (2) the district court erred by imposing a two-level enhancement for sophisticated laundering pursuant to U.S.S.G. § 2S1.1(b)(3); and (3) the district court's application of Justice Breyer's remedial holding in United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005), violates the Ex Post...