U.S. v. Grant

Citation431 F.3d 760
Decision Date29 November 2005
Docket NumberNo. 04-12268.,04-12268.
PartiesUNITED STATES of America, Plaintiff-Appellee, v. Darryl Arlene GRANT, a.k.a. Mack Hardy, Defendant-Appellant.
CourtUnited States Courts of Appeals. United States Court of Appeals (11th Circuit)

W. Charles Fletcher (Court-Appointed), Selinger & Fletcher, P.A., Jacksonville, FL, for Grant.

Tamra Phipps, Tampa, FL, Peggy Morris Ronca, Asst. U.S. Atty., Jacksonville, FL, for U.S.

Appeal from the United States District Court for the Middle District of Florida.

Before BLACK, WILSON and COX, Circuit Judges.

BLACK, Circuit Judge:

Darryl Arlene Grant appeals his sentence for producing and possessing counterfeit corporate checks, in violation of 18 U.S.C. §§ 2 and 514. On appeal, he argues the district court clearly erred by calculating an intended loss of $230,009.54 and imposing a 12-level sentence enhancement under U.S.S.G. § 2B1.1(b)(1)(G).1 Specifically, he contends the district court's intended loss calculation should not have included the $182,899.54 total face value of photocopies of stolen corporate checks found in his possession. We affirm.

I. BACKGROUND

The facts are not in dispute. We briefly address them to place the legal issue in context. Over the course of several months in 2003, Grant and a number of unindicted coconspirators participated in identity theft, bank fraud, theft from the United States mails, and manufacturing and negotiating counterfeit checks. Grant's counsel described his client's role in the criminal enterprise as follows:

[T]his case was about obtaining legitimate checks and specifically a photocopy of a legitimate check and going to a home computer with check writing software and inserting legitimate routing numbers and a legitimate business name into your computer on your check writing software and reproducing checks that you could then . . . go out and attempt to negotiate.

. . . .

[The photocopied checks] are — I guess the best word is templates. You take the body of the check. You reproduce it and then you put in whatever amount you want to put in and attempt to negotiate it . . . .

A federal grand jury indicted Grant for producing and possessing counterfeit corporate checks, in violation of 18 U.S.C. §§ 2 and 514. He pled guilty to the charge.

At his sentencing hearing, Grant argued the district court's intended loss calculation should not include the full face value of four photocopied checks found in his apartment. Specifically, he objected to consideration of (1) photocopies of two corporate checks from Professional Escrow Services, which totaled $177,899.54, and (2) photocopies of two corporate checks from Colony Insurance, which totaled $5000. After considering the parties' arguments, the district court overruled Grant's objection, finding "the intended loss [was] the face amount of the checks that could have actually been reproduced on the computer because that's how much the banks would have said were in there to cover them." Accordingly, the district court imposed a 12-level sentence enhancement under § 2B1.1(b)(1)(G).2

II. STANDARD OF REVIEW

We review for clear error the district court's determination regarding the amount of loss under the Guidelines. United States v. Manoocher Nosrati-Shamloo, 255 F.3d 1290, 1291 (11th Cir.2001).

III. DISCUSSION

The only issue on appeal is whether a district court clearly errs by including the full face value of photocopied corporate checks in its calculation of intended loss.3 This issue is one of first impression in our circuit.

Section 2B1.1 of the Guidelines provides a base offense level of six for crimes involving altered or counterfeit instruments, and includes an enhancement based on the dollar value of the loss. "Loss" is defined as the greater of "actual loss" or "intended loss," where the actual loss includes "the reasonably foreseeable pecuniary harm that resulted from the offense," and intended loss "(I) means the pecuniary harm that was intended to result from the offense; and (II) includes intended pecuniary harm that would have been impossible or unlikely to occur." U.S.S.G. § 2B1.1 cmt. n. 2(A)(i), (ii). In calculating the amount of loss, the district court "need only make a reasonable estimate of the loss." Id. § 2B1.1 cmt. n. 2(C). Although a "`district court must not speculate concerning the existence of a fact which would permit a more severe sentence under the guidelines,' its reasonable estimate of the intended loss will be upheld on appeal." United States v. Dominguez, 109 F.3d 675, 676 (11th Cir.1997) (quoting United States v. Wilson, 993 F.2d 214, 218 (11th Cir.1993)) (citation omitted).

The other circuits to address this issue have held a district court does not clearly err when it uses the full face value of a check to calculate intended loss. In United States v. Osborne, 332 F.3d 1307 (10th Cir.2003), the Tenth Circuit considered a case involving a counterfeit check scheme similar to the one in which Grant participated. The defendants stole checks from the mail and then used a computer program to scan the stolen checks, alter the payee and amount, and print counterfeit checks. Id. at 1309. In other words, the defendants utilized the stolen checks as templates from which they could produce counterfeit checks. The district court determined the defendants intended to use the $708,519 face value of seized stolen and counterfeit checks and included this amount in its calculation of the intended loss. Id.

On appeal, one of the defendants challenged the district court's intended loss calculation, asserting the "`face amount of the checks at the [coconspirators'] residence ha[d] nothing to do with the amount for which said checks would be counterfeited.'" Id. at 1312-13. The Tenth Circuit rejected the defendant's argument, noting (1) expert testimony any check with an account number could potentially be negotiated, (2) the fact all of the checks seized from the coconspirators' residence had account numbers on them, and (3) the uncontroverted fact a single stolen check would be counterfeited multiple times for increased amounts. Id. at 1313. Based on this evidence, the Tenth Circuit determined the district court did not clearly err in using the full face value of the seized checks to estimate the intended loss. Id.

The Third Circuit has also held a district court does not commit clear error when, in the absence of sufficient evidence to the contrary, it determines the defendant intended to utilize the full face value of worthless checks. See United States v. Geevers, 226 F.3d 186, 188 (3d Cir.2000). In United States v. Himler, 355 F.3d 735 (3d Cir.2004), the Third Circuit clarified the holding in Geevers. The defendant in Himler was convicted of using two counterfeit checks to purchase a condominium, and the district court included the full face value of the counterfeit checks in its intended loss calculation. Id. at 738-39.4 On appeal, the defendant argued the district court "based its [intended loss] finding solely on the face value amount of the forged checks and that, because this Court . . . rejected [in Geevers] a per se rule that intended loss can be inferred from the face value of the check, the District Court committed an error of law." Id. at 741.

The Third Circuit dismissed the defendant's reading of Geevers. "What Geevers stands for is not only that it is reasonable to infer that a defendant in [the defendant's] position intends the full loss of the face value of his false checks, but also that the matter `is not to be determined as a question of law, but as one of fact.'" Id. (quoting Geevers, 226 F.3d at 193). After reviewing the evidence presented against the defendant, the Third Circuit determined the district court did not commit clear error in finding the intended loss included the full face value of the checks. Id.5

Although this appeal presents an issue of first impression in our circuit, we do not lack analogous case law. In United States v. Manoocher Nosrati-Shamloo, the defendant was convicted of stealing mail and using the personal information contained therein to open credit card accounts. 255 F.3d 1290, 1290-91 (11th Cir.2001). At the sentencing hearing, the Government presented circumstantial evidence indicating the defendant intended to utilize all of the credit available on the cards, and the defendant failed to present countervailing evidence. Id. at 1292. The district court calculated an intended loss of $43,000, the amount of the combined credit limits on the cards obtained through the stolen mail. Id. at 1291.

On appeal of the district court's intended loss calculation, we determined "once a defendant has gained access to a certain credit line by fraudulently applying for credit cards, a district court does not err in determining the amount of the intended loss as the total line of credit to which Defendant could have access, especially when Defendant presents no evidence that he did not intend to utilize all of the credit available on the cards." Id. Moreover, we noted "[a] defendant's intent is often difficult to prove and often must be inferred from circumstantial evidence." Id. at 1292 (citing United States v. Ethridge, 948 F.2d 1215, 1217 (11th Cir.1991); Hill v. Kemp, 833 F.2d 927, 930 (11th Cir.1987)).

In this case, Grant admitted the purpose of the photocopied Personal Escrow Services and Colony Insurance checks was to use them as templates for producing counterfeit checks on his personal computer. Grant also admitted (1) one of his coconspirators opened a bank account using counterfeit checks purported to be drawn on a Professional Escrow Services account, and (2) he had produced or possessed counterfeit checks in order to withdraw funds from a Colony Insurance account. The photocopied Professional Escrow Services and Colony Insurance checks not only provided him with routing numbers and business names, but also information about the companies' account balances. As the Government asserted during the sentencing hearing, "[i]f there's a...

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