U.S. v. Gort-DiDonato

• Decision Date: 27 March 1997
• Docket Number: No. 96-1601,GORT-D,96-1601
• Citation: 109 F.3d 318
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. LisaiDONATO, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 318

109 F.3d 318

UNITED STATES of America, Plaintiff-Appellee, v. Lisa GORT-DiDONATO, Defendant-Appellant.

No. 96-1601.

United States Court of Appeals Sixth Circuit.

Argued March 5, 1997.

Decided March 27, 1997.

Julie Ann Woods, Asst. U.S. Attorney (argued and briefed), Grand Rapids, MI, for Plaintiff-Appellee.

Lisa Gort-DiDonato, Pekin, IL, pro se.

David L. Kaczor (argued and briefed), Grand Rapids, MI, for Defendant-Appellant.

Before: KEITH, KENNEDY, and COLE, Circuit Judges.

KENNEDY, Circuit Judge.

Defendant, Lisa Gort-DiDonato, appeals the sentence she received following her guilty plea to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 371. Defendant asserts that the District Court erred in enhancing her sentence under § 3B1.1(c) of the Sentencing Guidelines. That section imposes a two-level enhancement for being an organizer, leader, manager, or supervisor of a criminal activity consisting of at least one participant but fewer than five participants. For the reasons set forth below, defendant's sentence is VACATED.

I.

The offense conduct leading to defendant's conviction allegedly began when defendant visited St. Thomas, Virgin Islands, with an individual identified as Dennis Smith in July, 1992. According to defendant, Smith obtained cocaine from a Jamaican gang to deliver to Philadelphia. When Smith failed to deliver the drugs, he informed the gang that defendant absconded with the cocaine. When defendant started to receive strange phone calls and see strange people hanging around her neighborhood in Philadelphia, she believed that her life and the lives of her family members were in danger. When defendant shared this information with Richard Gaffney, her boyfriend, Gaffney told her that he was affiliated with the mafia and could provide protection to defendant and her family if she supplied him with money. Defendant then informed her family that they were in danger and that Gaffney could protect them if they wired money to him in Philadelphia.

From August 1, 1994, through April 8, 1995, the defendant and her parents wired a total of $134,251.00 to Gaffney in Philadelphia. Gaffney, Diane Blair, or others who were authorized by Gaffney to receive the money, would pick up the wired funds from Western Union. Defendant also, without authorization, withdrew money from a sister's account. Defendant admitted at the plea hearing that she was indeed afraid for her life at the outset but that, at some point, she questioned whether her life was truly in danger. Despite this realization, she nevertheless continued to obtain money from her parents using false statements.

According to the Presentence Report, an investigation of several individuals who were authorized to pick up funds from Western Union revealed that "Gaffney and the defendant were actually the ones who sphere headed [sic] the fraud" and that the "money was used to improve the lifestyle of the defendant and Gaffney, as she had planned to join Gaffney in Philadelphia at some point in the future." The money was also reportedly used to support the drug habits of Gaffney and Blair, as well as for Gaffney's lavish trips, chauffeur-driven limousine rides, and expensive dinners.

As a result of this conduct, defendant was charged in a two-count indictment with conspiracy to commit wire fraud, in violation of 18 U.S.C. §§ 371 and 1343, and wire fraud, in violation of 18 U.S.C. § 1343. Defendant pled guilty to the conspiracy to commit wire fraud count pursuant to a plea agreement entered into with the Government. Defendant was sentenced to eighteen months incarceration to be followed by a three-year term of supervised release. In arriving at this sentence, the District Court increased defendant's offense level by two pursuant to the Sentencing Guidelines after concluding that defendant was an organizer, leader, manager, or supervisor in a criminal activity involving fewer than five participants under U.S.S.G. § 3B1.1(c). ¹ The court enhanced her sentence under § 3B1.1(c) on the following grounds:

... It appears that Gort-Di Donato [sic] and Gaffney played major roles in planning the conspiracy. In particular, Gort-Di Donato [sic] played a major role in selecting her relatives, her own family, as the target of this crime. She made the assessment as to their finances. She made the persuasive argument to them to honor her requests. Under these circumstances, it appears to me that the Guideline was appropriately applied because the defendant Gort-Di Donato [sic] played a major role in planning the offense.

The offense was not narrow or limited given the use of both knowing and unknowing participants to accomplish the offense--unless by some reason Blair was an unknowing participant, or others--and the offense was a serious offense that involved bilking her own family out of large amounts of money over a fairly extended time period.

Defendant timely appeals from the sentence imposed by the District Court.

II.

Defendant's sole argument on appeal is that the District Court erred in applying the two level enhancement of § 3B1.1(c) of the Sentencing Guidelines. We review the District Court's legal conclusions regarding the application of Sentencing Guidelines de novo; however, we accept the District Court's findings of fact unless they are clearly erroneous. See United States v. Rutana, 18 F.3d 363, 365 (6th Cir.1994). A finding is clearly erroneous when "although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed." United States v. Perez, 871 F.2d 45, 48 (6th Cir.1989). To apply the § 3B1.1 enhancement, the government must establish, by a preponderance of the evidence, the elements of § 3B1.1. See United States v. Ledezma, 26 F.3d 636, 644 (6th Cir.1994).

Section 3B1.1 provides:

Aggravating Role

Based on the defendant's role in the offense, increase the offense level as follows:

(a) If the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive, increase by 4 levels.

(b) If the defendant was a manager or supervisor (but not an organizer or leader) and the criminal activity involved five or more participants or was otherwise extensive, increase by 3 levels.

(c) If the defendant was an organizer, leader, manager, or supervisor in any criminal activity other than described in (a) or (b), increase by 2 levels.

U.S.S.G. § 3B1.1.

Prior to November 1, 1993, an enhancement was warranted under § 3B1.1(c) where the defendant exercised a managerial, leadership, organizational or supervisory role in a criminal enterprise and four or less individuals were involved in the criminal enterprise; the defendant need not have exercised control over a specific member of the conspiracy. To illustrate, in United States v. Bashara, 27 F.3d 1174 (6th Cir.1994), this Court, applying subsection (b) of § 3B1.1 noted, "[t]he text of the Guidelines and its commentary does not require that five of the activity's participants be subordinate to the defendant; it merely requires that the activity involve five or more participants. In this case, at least five people participated in [the defendant's] criminal activity, and he played a role that may properly be categorized as that of 'manager or supervisor.' " Id. at 1184.

Similarly, in United States v. Alexander, 59 F.3d 36 (6th Cir.1995), we rejected the defendant's contention that an enhancement under § 3B1.1 was improper because he did not exercise control over any of his co-defendants in a drug conspiracy stating that "defendant [need not] directly employ or control a partnership or enterprise." Id. at 38; see also United States v. Schultz, 14 F.3d 1093, 1099 (6th Cir.1994). Bashara and Schultz, however, without expressly noting, applied the guideline and commentary articulated in § 3B1.1 in effect at the time the defendants were sentenced. In both cases, the guideline in effect at the time of sentencing did not include an amendment to the commentary which took effect November 1, 1993. That amendment, which is now articulated in Application Note 2 of the Commentary to § 3B1.1, provides:

To qualify for an adjustment under this section, the defendant must have been the organizer, leader, manager, or supervisor of one or more other participants. An upward departure may be warranted, however, in the case of a defendant who did not organize, lead, manage, or supervise another participant, but who nevertheless exercised management responsibility over the property, assets, or activities of a criminal organization.

U.S.S.G. § 3B1.1, comment. (n.2).

Application Note 2 was added to clarify confusion amongst the circuit courts as to the operation of § 3B1.1. See U.S.S.G., Appendix C, amendment 500. Prior to the amendment, some circuits had concluded that a defendant's control over the property, assets or activities of a criminal enterprise warranted a § 3B1.1 enhancement. See, e.g., United States v. Chambers, 985 F.2d 1263 (4th Cir.1993). Other circuits, however, were of the view that an enhancement was proper only where the defendant exercised control over at least one participant in the enterprise. See, e.g., United States v. Fuentes, 954 F.2d 151 (3d Cir.1992); United States v. Fuller, 897 F.2d 1217 (1st Cir.1990).

As noted by the Seventh Circuit, the amended application note permits an increased sentence whether the defendant exercised control over an individual within the criminal enterprise or merely exercised control over the property, assets or activities of the enterprise. See United States v. Fones, 51 F.3d 663, 668 (7th Cir.1995); see also United States v. Capers, 61 F.3d 1100, 1110 (4th Cir.1995), cert. denied, --- U.S. ----, 116 S.Ct. 1830, 134 L.Ed.2d 935 (1996). However, under the amended provision, the method by which the defendant's sentence is increased depends on whether the defendant exercised control over...