U.S. v. Schweitzer

• Decision Date: 11 July 2006
• Docket Number: No. 05-1301.,05-1301.
• Citation: 454 F.3d 197
• Parties: UNITED STATES of America v. Leo F. SCHWEITZER, III, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

454 F.3d 197

UNITED STATES of America v. Leo F. SCHWEITZER, III, Appellant.

No. 05-1301.

United States Court of Appeals, Third Circuit.

Submitted Under Third Circuit LAR 34.1(a) June 12, 2006.

Filed July 11, 2006.

Amara S. Chaudhry, Norristown, PA, Attorney for Appellant.

Christopher R. Hall, Office of United States Attorney, Philadelphia, PA, Attorney for Appellee.

Before FISHER, GREENBERG and LOURIE,^* Circuit Judges.

OPINION OF THE COURT

FISHER, Circuit Judge.

The record of a case provides the only window by which an appellate court can survey the underlying proceedings, to assess claims of error and the legality of judgment. Development of that record is thus of critical importance, a principle illustrated by this case. Through an extensive plea colloquy and detailed statement of reasons, the District Court created a record that demonstrates both the validity of the guilty plea and the reasonableness of the final, above-guidelines sentence. We will affirm.

I.

A.

Leo F. Schweitzer, III, has a two-decade history of defrauding the Department of Defense. The ill-fated relationship began in the early 1980s, when Schweitzer agreed to supply military contractors with manufactured components for construction and production. The materials that he provided were, however, defective and of little value. Schweitzer pled guilty in 1985 to mail fraud and making false statements, and he was sentenced to fifteen years' imprisonment, to be followed by a term of supervised release. The District Court also enjoined Schweitzer, as a special condition of release, from engaging in contractual arrangements with the United States, either directly or indirectly.

The admonition had little effect. Soon after Schweitzer was paroled in 1990, he and a cohort secured new government supply contracts worth nearly $800,000. They filled these orders through a series of front businesses, which were used to procure the necessary goods on credit from third parties and were then closed when payment was demanded. The scheme was eventually uncovered, and Schweitzer pled guilty in 1995 to conspiracy, making false statements, and money laundering. His parole was revoked, and he was sentenced to forty-one months' imprisonment. Once again, the District Court barred Schweitzer from contracting with the United States, either directly or indirectly.

Once again, the order was ignored. Schweitzer was released from custody in 1999 and quickly launched another plot involving contracts with the Department of Defense. As in the prior scheme, he and a coconspirator used a series of front businesses, nominally controlled by friends and family members, to obtain goods on credit for resale to the government. The conspirators profited from the venture, but the third-party suppliers were never paid. Schweitzer was arrested in 2003 and charged by indictment with multiple counts of wire fraud, mail fraud, and making false statements.

B.

Schweitzer initially entered a plea of not guilty, and a jury trial commenced in August 2004. However, on the tenth day of trial, Schweitzer indicated that he had reached an agreement with the prosecution and wished to plead guilty to thirty-three counts of mail fraud, wire fraud, and making false statements.

1.

A change of plea hearing was held on September 13, 2004. The District Court asked Schweitzer whether he was satisfied with his representation and had been given adequate time to discuss the case with his attorney. Schweitzer responded in the affirmative. The District Court then asked Schweitzer whether he had read the plea agreement "entirely," had understood "everything in there," and had "fully gone over" the document with his attorney. Schweitzer again responded in the affirmative.

The District Court addressed in detail the provisions of the plea agreement. The agreement states that the "total statutory maximum sentence" to which Schweitzer will be exposed by his plea is 165 years' imprisonment. It also recites a number of stipulations to which the parties had agreed for purposes of sentencing, including that "the defendant has [nine] criminal history points, resulting in a Criminal History Category IV." However, it acknowledges that "these stipulations are not binding upon either the Probation Department or the Court" and that "[t]he defendant may not withdraw his plea because the Court declines to follow any . . . stipulation by the parties to this agreement."

The agreement also includes a broad waiver of appellate rights. It provides that "the defendant voluntarily and expressly waives all rights to appeal or collaterally attack the defendant's conviction, sentence, or any other matter relating to this prosecution, whether such a right to appeal or collateral attack arises under 18 U.S.C. § 3742, 28 U.S.C. § 1291, 28 U.S.C. § 2255, or any other provision of law." The only exceptions are for claims that "the defendant's sentence exceeds the statutory maximum" or that "the sentencing judge erroneously departed upward from the otherwise applicable sentencing guidelines range." The agreement specifically states that, "[i]f the defendant does appeal pursuant to [one of these exceptions], no issue may be presented by the defendant on appeal other than those described in [these exceptions]."

The District Court recited these provisions on the record and confirmed that Schweitzer understood each of them. It advised Schweitzer that, although the defense and the prosecution "can agree on facts . . . [and] make recommendations at sentencing," the Court is not bound by those stipulations and that, regardless of the Court's findings, the plea "is still binding on you." It admonished: "[N]o one can guarantee you what sentence you will get from me." It recounted the charges to which Schweitzer was pleading guilty and stated that, because each of the thirty-three offenses carried a potential term of five years' imprisonment, the "total statutory maximum sentence would be 165 years in prison."

Schweitzer responded that he understood the agreement and the effects of his plea and still wished to plead guilty. The District Court found on the record that "the defendant is fully aware, competent and capable of entering an informed plea" and that "his plea is a knowing and voluntary plea." It accepted the plea, directed preparation of a presentence report, and scheduled sentencing proceedings.

2.

A sentencing hearing was held on January 27, 2005, two weeks after the Supreme Court issued its decision in United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005). Argument centered on whether Schweitzer should receive credit for acceptance of responsibility, see U.S. Sentencing Guidelines Manual § 3E1.1, and whether he should be granted a downward departure based on criminal history, see id. § 4A1.3. Defense counsel asserted that Schweitzer had, by pleading guilty and offering to make full restitution, recognized his own complicity in the crimes and accepted responsibility. As to the request for a departure, counsel conceded that Schweitzer was properly assigned to criminal history category V based on his five prior convictions,¹ but argued that this category over-represented the seriousness of his past offenses and the likelihood of recidivism, warranting a downward departure.²

Schweitzer testified in his own behalf. He acknowledged guilt of the crimes with which he was charged and indicated that he planned to make full restitution to the victims. On cross-examination, however, he admitted that he had not yet offered any restitution in this case and had not yet satisfied restitution obligations arising from his prior convictions, totaling nearly $1 million. He also insisted that he had, at the time of his offenses, intended to satisfy the debts owed to the third-party suppliers.

The District Court denied credit for acceptance of responsibility. It noted that Schweitzer had not withdrawn voluntarily from his criminal activities and had not assisted law enforcement. It also concluded that Schweitzer had, by asserting that he had always intended to repay the defrauded third parties, refused to accept fully his own culpability in the offenses.

The District Court also denied the request for a downward departure. It found that, in light of the numerous victims of Schweitzer's crimes and his persistent failure to rehabilitate, his assignment to criminal history category V did not over-represent the "seriousness of his criminal history" or the "likelihood that he will commit other crimes."

The District Court determined, based on the presentence report, that Schweitzer should be assigned to an offense level of seventeen and a criminal history category of V. The recommended range of imprisonment under the United States Sentencing Guidelines was forty-six to fifty-seven months.

Nevertheless, the final term of imprisonment imposed by the District Court was eighty-four months, nearly fifty percent above the recommend range. It offered a lengthy justification for the sentence:

This case represents this defendant's third federal conviction and fourth overall for similar criminal behavior. Moreover, the offense was committed while the defendant was under supervision.

For more than the past twenty years, this defendant has involved himself in the acquisition of defense contracts . . . . [I]t is believed that the defendant may have been quite successful in operating such a business legitimately.

However, [he] decided that [one hundred] percent profit is better than any lesser amount of profit, and[,] as a result, at least [twenty-nine] companies have been victimized this time around, but over a hundred victims over the period of his prior convictions.

The defendant was barred from selling goods to the government directly or indirectly as a condition of his parole . . . and under the terms of his supervised released. . . . Despite this prohibition by court orders, the defendant was not deterred. He elicited the...