U.S. v. Sedore

• Decision Date: 16 January 2008
• Docket Number: No. 06-2259.,06-2259.
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Paul M. SEDORE, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

512 F.3d 819

UNITED STATES of America, Plaintiff-Appellee, v. Paul M. SEDORE, Defendant-Appellant.

No. 06-2259.

United States Court of Appeals, Sixth Circuit.

Argued: October 23, 2007.

Decided and Filed: January 16, 2008.

ARGUED: Paul L. Nelson, Federal Public Defender's Office, Grand Rapids, Michigan, for Appellant. Matthew G. Borgula, Assistant United States Attorney, Grand Rapids, Michigan, for Appellee. ON BRIEF: Paul L. Nelson, Federal Public Defender's Office, Grand Rapids, Michigan, for Appellant. Matthew G. Borgula, Assistant United States Attorney, Grand Rapids, Michigan, for Appellee.

Before: MERRITT and CLAY, Circuit Judges; COX, District Judge.^*

COX, D. J., delivered the opinion of the court. CLAY, J. (p. 828), delivered a separate concurring opinion. MERRITT, J. (pp. 828-33), delivered a separate dissenting opinion.

OPINION

SEAN F. COX, District Judge.

This matter is before the Court on Defendant Paul M. Sedore's second appeal of his criminal sentence. Defendant challenges the application of sentencing enhancements based on (1) his abuse of a position of trust and (2) the number of victims. Defendant also alleges his sentence is substantively unreasonable. We find that Defendant did abuse a position of trust and waived his argument regarding the number of victims. Further, his sentence is not substantively unreasonable. Accordingly, we AFFIRM the decision of the district court.

I. BACKGROUND

This action arises out of the sentencing of Defendant for one count of conspiracy to defraud the Internal Revenue Service ("IRS") in violation of 18 U.S.C. § 286; and one count of identity theft in violation of 18 U.S.C. § 1028(a)(7). From 1999 through 2002, Defendant engaged in a scheme to defraud the IRS by preparing false tax returns using stolen names and social security numbers. Defendant's aunt, Katherine King, also participated in the scheme. Some of the names and social security numbers used for the false tax returns were obtained from legitimate tax returns Defendant prepared for friends and acquaintances. One such instance involved an individual named Thaddeus Taylor ("Taylor") who Defendant met while in a rehabilitation facility. Defendant prepared a legitimate tax return for Taylor. However, Defendant filed false tax returns using the names and social security numbers of Taylor's children, which he obtained while preparing Taylor's tax return. Taylor was not a participant in the scheme. Other names and social security numbers were allegedly taken from a local newspaper that published such information in regard to child guardianship matters.

Defendant was incarcerated for most of the conspiracy. Defendant, along with his aunt, claimed approximately $155,869.39 in refunds, and received $51,950.33 from the IRS.

A federal grand, jury returned an indictment on December 18, 2003 charging Defendant with: (1) conspiring to defraud the IRS in violation of 18 U.S.C. § 286; (2) making false tax returns to the IRS in violation of 18 U.S.C. § 287; and (3) identity theft in violation of 18 U.S.C. § 1028(a)(7). On March 30, 2004, Defendant pled guilty to Counts I and III, conspiracy to defraud the IRS and identity theft.

Defendant filed four objections to the initial pre-sentence report. He objected to: (1) an enhancement for abuse of trust pursuant to U.S.S.G. § 3B1.3; (2) failure to award a three-level reduction for acceptance of responsibility pursuant to U.S.S.G. § 3E1.1; (3) an enhancement for obstruction of justice pursuant to U.S.S.G. § 3C1.1; and (4) the finding that his crime included 50-250 victims, rather than 10-50 victims pursuant to U.S.S.G. § 2B1.1(b)(2)(A). [J.A. at 47]. The district court held a sentencing hearing on July 13, 2004, however the hearing was continued to August 3, 2004, to allow supplemental briefing regarding the applicability of the United States Sentencing Guidelines. At the August 3, 2004 sentencing hearing, the district court accepted Defendant's argument with respect to his objections regarding acceptance of responsibility and agreed with Defendant's argument that there were only 31 victims. The sentencing enhancement for number of victims was calculated based on 31 victims, rather than 50-250 victims. The district court did not find in Defendant's favor on his objections to the obstruction of justice and abuse of trust enhancements. Additionally, the court found Defendant's criminal history was underrepresented and departed upwards. The district court determined that Defendant's offense level was 22 with a criminal history category of VI, resulting in a guideline range of 84 to 105 months. On August 3, 2004, the district court sentenced Defendant to 84 months.

Defendant appealed his sentence, arguing that the district court erred when it: (1) found he has a special skill for purposes of the abuse of trust enhancement; (2) found he obstructed justice; (3) enhanced his base offense level on facts found by a preponderance of the evidence contrary to United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005); and (4) departed upward based on his past criminal history. On April 13, 2006, this Court vacated the sentence and remanded the case for re-sentencing pursuant to Booker. In addition, we stated that, for guidance, the district court should consider the Tenth Circuit case United States v. Guidry, 199 F.3d 1150, 1160 (10th Cir.1999), with respect to whether Defendant occupied a position of trust. United States v. Sedore, 175 Fed.Appx. 714 (6th Cir.2006)

Defendant's re-sentencing hearing was held on September 5, 2006. In his sentencing memorandum for re-sentencing, Defendant argued, in addition to his previous arguments, that the district court erred when it found at his first sentencing that there were more than ten victims. At the re-sentencing hearing, the district court addressed the abuse of trust enhancement and stated that the enhancement was applied with respect to the identity theft charge, based on Defendant's use of Taylor's children's information. [J.A. at 205]. The district court also reaffirmed its finding with respect to the obstruction of justice enhancement. However, the number of victims argument was not addressed at the hearing and Defendant did not raise it. The district court found that Defendant's offense level was 21, including a two point upward departure, and extrapolated a criminal history category of VIII. The advisory sentencing guideline range was 77-96. The district court sentenced Defendant to a term of 84 months.

Defendant filed the instant appeal on September 11, 2006. Defendant argues that the district court misapplied U.S.S.G. § 3B1.3 when it enhanced his sentence based on ail abuse of a position of trust. According to Defendant, the district court erred by imputing the relationship between Taylor and Defendant to Taylor's children and Defendant. Defendant argues that under Guidry, supra, the position of trust must be found in relation to the victim of the offense, and there must be pecuniary loss. According to Defendant, the victims of the offense of identity theft are Taylor's children, with whom Defendant did not have a position of trust and who suffered no pecuniary loss. Defendant concludes that because the § 3B1.3 enhancement was predicated on Defendant's relationship with Taylor, whose identity was not stolen, the enhancement is improper. Defendant further contends that the district court misapplied § 2B1.1(B)(2) when it found that the number of victims was between 10-50. Defendant asserts that, consistent with Guidry, only the IRS suffered pecuniary loss and is, therefore, the only "victim."

Finally, Defendant asks the Court to order that on remand the re-sentencing range is limited to 51 to 63 months, assuming the Court finds for Defendant on his arguments. In the alternative, Defendant asks that if this Court declines to issue a limited remand, that it require the district court to explain in detail its reasons for the sentence it imposes. Specifically, Defendant is concerned that the district court will choose to further increase the offense level, above the two points added under the previous re-sentencing, out of vindictiveness.

II. STANDARD OF REVIEW

We review a district court's sentencing determination for reasonableness. United States v. Wilms, 495 F.3d 277, 280 (6th Cir.2007). Reasonableness has both substantive and procedural components. United States v. Liou, 491 F.3d 334, 337 (6th Cir.2007). "As to procedural reasonableness, we have held that a sentence may be procedurally unreasonable if the district judge fails to consider the applicable Guidelines range or neglects to consider the other factors listed in 18 U.S.C. § 3553(a), and instead simply selects what the judge deems an appropriate sentence without such required consideration.'" Id, (citing United States v. Jones, 489 F.3d 243, 250 (6th Cir.2007)). "In considering substantive reasonableness, we have held that `a sentence may be substantively unreasonable where the district court selects the sentence arbitrarily, bases the sentence on impermissible factors, fails to consider pertinent § 3553(a) factors, or gives an unreasonable amount of weight to any pertinent factor.'" Liou, 491 F.3d at 337 (citations omitted). A rebuttable presumption of substantive reasonableness applies for sentences that fall within the applicable sentencing guideline range. Id. See also Rita v. United States, ___ U.S. ___, 127 S.Ct. 2456, 2459, 168 L.Ed.2d 203 (2007) (holding that the courts of appeals may apply a presumption of reasonableness for sentences within the advisory Guidelines range).

III. ANALYSIS

On appeal, Defendant raises three arguments: (1) the district court erred by enhancing Defendant's sentence pursuant to U.S.S.G. § 3B1.3; (2) the district court erred by enhancing Defendant's sentence pursuant to U.S.S.G. § 2B1.1(b)(2)(A); and (3) Defendant's sentence was substantively unreasonable.

A. Sentencing Enhancement Under U.S.S.G. §...