U.S. v. Lopez

• Decision Date: 11 October 1996
• Docket Number: Nos. 95-30230,95-30236,s. 95-30230
• Citation: 104 F.3d 1149
• Parties: , 97 Cal. Daily Op. Serv. 346, 97 Daily Journal D.A.R. 537 UNITED STATES of America, Plaintiff-Appellee, v. Maria R. LOPEZ, aka Maria R. Huerta, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Jose Eusebio HUERTA, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1149

104 F.3d 1149

65 USLW 2495, 97 Cal. Daily Op. Serv. 346,

97 Daily Journal D.A.R. 537

UNITED STATES of America, Plaintiff-Appellee, v. Maria R. LOPEZ, aka Maria R. Huerta, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Jose Eusebio HUERTA, Defendant-Appellant.

Nos. 95-30230, 95-30236.

United States Court of Appeals, Ninth Circuit.

Submitted Oct. 11, 1996. ^*

Decided Jan. 14, 1997.

Elizabeth A. Burr-Jones, Burley, Idaho, for defendant-appellant Lopez.

R. Keith Roark, Roark, Rivers, Baxter & Phillips, Hailey, Idaho, for defendant-appellant Huerta.

Barry McHugh, Assistant United States Attorney, Boise, Idaho, for plaintiff-appellee.

Appeals from the United States District Court for the District of Idaho, Edward J. Lodge, District Judge, Presiding. D.C. Nos. CR-94-00043-08-EJL, CR-94-00043-5-EJL.

Before: BROWNING, NELSON, and FERNANDEZ, Circuit Judges.

OPINION

PER CURIAM:

Maria Lopez and Jose Huerta appeal their convictions and sentences. ¹ Lopez was convicted of money laundering and conspiracy to distribute marijuana and cocaine. Lopez appeals the district court's refusal to "group" her conspiracy and money laundering convictions for sentencing. See U.S.S.G. § 3D1.2. We reverse and remand for resentencing.

FACTS

A grand jury returned a 26-count indictment against Lopez, Lopez's common-law husband Tomas Huerta, Jose Huerta and other Huerta family members. Lopez was indicted for conspiracy to distribute cocaine and marijuana, in violation of 21 U.S.C. §§ 841(a)(1), 846, and laundering $26,300, in violation of 18 U.S.C. § 1957.

At trial, the government presented evidence that Lopez admitted knowledge of her husband's involvement in the drug business and that she took messages for him. The government demonstrated Lopez transported two kilograms of cocaine; one from California to Idaho and one from California to Nevada. The government also presented evidence that Lopez laundered drug money by exchanging cash for cashier checks eight separate times. Some of the money for which Lopez obtained cashier's checks was marked by an undercover informant. Lopez then posed as Gregoria Huerta and used the cashier's checks to purchase a home for approximately $26,300. The government also demonstrated that neither Lopez nor Tomas had sufficient legitimate income to purchase a home with cash.

STANDARD OF REVIEW

We examine de novo the district court's refusal to group these offenses under the Sentencing Guidelines. See United States v. Rose, 20 F.3d 367, 371 (9th Cir.1994).

ANALYSIS

We conclude that the district court erred in refusing to group Lopez's conspiracy and money laundering convictions for sentencing under § 3D1.2 of the Sentencing Guidelines.

Section 3D1.2 permits grouping of closely related counts. Subsection (b) permits grouping "[w]hen counts involve the same victim and two or more acts or transactions connected by a common criminal objective or constituting part of a common scheme or plan." U.S.S.G. § 3D1.2.

Lopez's crimes satisfy the first requirement of subsection (b) of § 3D1.2. Victimless crimes, such as those involved here, are treated as involving the same victim "when the societal interests that are harmed are closely related." U.S.S.G. § 3D1.2, Application Note 2. The Fifth and Eleventh Circuits have held that the societal interests implicated by drug trafficking and money laundering are not closely related because narcotics distribution "increas[es] lawlessness and violence" while "money laundering disperses capital from lawfully operating economic institutions." United States v. Gallo, 927 F.2d 815, 824 (5th Cir.1991); see also United States v. Harper, 972 F.2d 321, 322 (11th Cir.1992). We disagree. The money laundering prohibition was adopted as part of the Anti-Drug Abuse Act of 1986. See Act of October 27, 1986, Pub.L. No. 99-570, 100 Stat. 3207. The legislative history of § 1957 demonstrates that Congress's primary purposes in prohibiting money laundering were to add a weapon to the arsenal against drug trafficking and to combat organized crime. See S.Rep. No. 99-433, at 4, 9-13 (1986); H.R.Rep. No. 99-855, at 8 (1986). The societal interests harmed by money laundering and drug trafficking are closely related Narcotics trafficking enables traffickers to reap illicit financial gains and inflict the detrimental effects of narcotics use upon our society; money laundering enables criminals to obtain the benefits of income gained from illicit activities, particularly drug trafficking and organized crime. See also Most Frequently Asked Questions About the Sentencing Guidelines 20 (7th ed. 1994) ("[B]ecause money laundering is a type of statutory offense that facilitates the completion of some other underlying offense, it is conceptually appropriate to treat a money laundering offense as 'closely intertwined' and groupable with the underlying offense.").

We do not believe that this position eliminates the money laundering laws as a weapon in the war against drug trafficking. The prohibition against money laundering still stands, and enables law enforcement officials to reach those in a drug conspiracy who clean the proceeds of the illicit activity but do not participate in the underlying criminal conduct. Grouping the crimes of conspirators who engage in both trafficking and laundering merely implements the Sentencing Commission's direction to group closely related counts.

Lopez's crimes also satisfy the second requirement of subsection (b) of § 3D1.2. Lopez's acts of drug trafficking and money laundering were connected by a common criminal objective. Lopez laundered money to conceal the conspiracy's drug trafficking and thus facilitated the accomplishment of the conspiracy's ultimate objective of obtaining the financial benefits of drug trafficking.

We reverse the district court's decision to reject grouping of these offenses under § 3D1.2 and remand for the district court to resentence Lopez.

REVERSED AND REMANDED.

FERNANDEZ, Circuit Judge, dissenting:

I respectfully dissent.

Lopez argues that the district court should have grouped her conspiracy conviction with her money laundering conviction for sentencing purposes. Under the Guidelines, the sentencing court must group counts involving "substantially the same harm." USSG § 3D1.2. ¹ There are four measures of "substantially the same harm." Subsections (a) and (b) focus on counts involving the same victim. USSG § 3D1.2(a)-(b). Subsection (c) requires grouping when "one of the counts embodies conduct that is treated as a specific offense characteristic in, or other adjustment to, the guideline applicable to another of the counts." USSG § 3D1.2(c). Finally, subsection (d) provides that counts involve substantially the same harm "[w]hen the offense level is determined largely on the basis of the total amount of harm or loss" or when the counts were "continuous in nature and the offense guideline is written to cover such behavior." USSG § 3D1.2(d). Section 3D1.2(d) lists several offenses which should be grouped, including the offenses at issue here, which are governed by USSG §§ 2D1.1 and 2S1.2.

Lopez does not articulate which subsection she believes applies here; in response, the government relies solely on cases discussing subsection (d). Lopez also fails to cite any case law, and relies solely on the Most Frequently Asked Questions About the Sentencing Guidelines (MFAQ), written by the Sentencing Commission's Training Staff. MFAQ (7th ed. June 1, 1994). While the MFAQ, by its own terms, is not definitive and is not binding on the courts or the Commission, it does raise an interesting question in this case, a question to which the Staff (and Lopez) gives the wrong answer.

MFAQ number 65 queries: "Can a count of money laundering be grouped with a count of drug distribution when the offense behavior involved laundering the proceeds of a drug distribution scheme?" MFAQ at 20. The answer, according to the Commission Staff, is "yes," at least "[i]n most cases." Id. First, the Staff concludes that these offenses have the same victim, and thus should be grouped under subsection (a) or (b). Next, it explains that subsection (c) provides an "alternative" to subsections (a) and (b) when the defendant's "sole function in the drug operation was to 'clean' the money." Id. at 21. Subsection (d) is not addressed.

Notwithstanding the MFAQ, grouping is not required by either subsection (a) or (b) because these offenses do not involve the same victim. In United States v. Barron-Rivera, 922 F.2d 549, 554-55 (9th Cir.1991), we held that where two offenses were victimless, grouping is based upon the nature of the offense. If they "pose threats to distinct and separate societal interests" they do not involve the same victim. Id. at 555. We cited the application note to the Guideline itself for that proposition. See USSG § 3D1.2, comment. (n. 2). We declared that the offense of being an illegal alien in the United States after deportation was separate from the offense of being an illegal alien in possession of a firearm. Barron-Rivera, 922 F.2d at 554. Although the victim in each case was society at large, the former law enforced immigration rules, while the latter protected society against those who were not entitled to possess firearms. Id. at 555.

The Fifth Circuit has pointed out that the offenses in question here yield to the same analysis. United States v. Gallo, 927 F.2d 815, 823-24 (5th Cir.1991). They too involve different victims because they invade "distinct societal interests"; narcotics distribution increases violence while money laundering "disburses capital from lawfully operating economic institutions to criminals." Id. at 824. The Eleventh Circuit has explicitly adopted that reasoning. See United States v. Harper, 972 F.2d 321, 322 (11th Cir.1992)(per curiam). I agree with them. The prohibition against narcotics distribution protects society from the evils wrought by that facinorous conduct. It would...