United States v. Boutcher

• Decision Date: 26 May 2021
• Docket Number: No. 20-4248,20-4248
• Citation: 998 F.3d 603
• Parties: UNITED STATES of America, Plaintiff - Appellee, v. Gerald Alex BOUTCHER, Defendant - Appellant.
• Court: U.S. Court of Appeals — Fourth Circuit

998 F.3d 603

UNITED STATES of America, Plaintiff - Appellee,

v.Gerald Alex BOUTCHER, Defendant - Appellant.

No. 20-4248

United States Court of Appeals, Fourth Circuit.

Argued: March 12, 2021

Decided: May 26, 2021

ARGUED: Erin McCampbell Paris, LIPSITZ GREEN SCIME CAMBRIA LLP, Buffalo, New York, for Appellant. Daniel Taylor Young, OFFICE OF THE UNITED STATES ATTORNEY, Alexandria, Virginia, for Appellee. ON BRIEF: Barry N. Covert, LIPSITZ GREEN SCIME CAMBRIA LLP, Buffalo, New York; Brian Denton West, THE WEST LAW GROUP, P.C., McLean, Virginia, for Appellant. G. Zachary Terwilliger, United States Attorney, Jamar K. Walker, Assistant United States Attorney, Kimberly R. Pedersen, Assistant United States Attorney, Aidan Taft Grano, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Alexandria, Virginia, for Appellee.

Before NIEMEYER, KEENAN, and HARRIS, Circuit Judges.

Dismissed by published opinion. Judge Keenan wrote the opinion, in which Judge Niemeyer and Judge Harris joined.

BARBARA MILANO KEENAN, Circuit Judge:

In this appeal, the defendant challenges the district court's orders of restitution and forfeiture, which were imposed based on his involvement in a scheme of unlawful "short sales"¹ of three residential properties in Virginia. Pursuant to a plea agreement, Gerald Boutcher pleaded guilty to conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349. The district court sentenced Boutcher to a three-year term of probation, and entered orders of restitution and forfeiture, each in the amount of $227,512.07.² Boutcher challenges his sentence only with respect to these orders of restitution and forfeiture.³ Upon our review, we do not reach the merits of Boutcher's arguments, because they are barred by the appeal waivers in his plea agreement. We therefore grant the government's motion to dismiss Boutcher's appeal.

I.

Over the course of a few years, Boutcher and his co-conspirator, Alkesh Tayal, worked together to defraud several banks and financial institutions with respect to "short sales" and refinancing transactions for three residential properties. Generally, the scheme involved the following conduct. Initially, Boutcher posed as a buyer in one fraudulent short sale of a property in which Tayal had a financial interest. Tayal intended to retain ownership of the property and, ultimately, to reduce his mortgage payment on that property. Also, the two men engaged in fraudulent short sales of other properties to sell or "flip" the properties at higher prices to gain a profit. In violation of the financial agreements that both men signed with various institutions, Boutcher and Tayal did not disclose their commercial relationship with each other. They also solicited others to pose as representative realtors on the fraudulent transactions, creating the appearance that the transactions were conducted at "arms-length."

A federal grand jury returned a multiple-count indictment against Boutcher and Tayal. Boutcher was charged with conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349 (Count 1), and conspiracy to commit money laundering, in violation of 18 U.S.C. §§ 2, 1956(h) (Count 5). The indictment included a forfeiture notice, in conformance with the provisions of 18 U.S.C. § 982(a) and Federal Rule of Criminal Procedure 32.2(a). After Boutcher agreed to plead guilty to Count 1 of the indictment, the government voluntarily dismissed Count 5.

In his plea agreement, Boutcher agreed to waive "the right to appeal the conviction and any sentence within the statutory maximum ... on the grounds set forth in 18 U.S.C. § 3742 or on any ground whatsoever other than an ineffective assistance of counsel claim that is cognizable on direct appeal" (the global appeal waiver). Section 3742 specifies four typically permissible grounds for a defendant to appeal a district court's sentence: (1) legal error; (2) misapplication of sentencing guidelines; (3) imposition of a sentence greater than the applicable guidelines range; and (4) imposition of a "plainly unreasonable" sentence for which there is no sentencing guideline. 18 U.S.C. § 3742(a).

The plea agreement also provided that "restitution is mandatory pursuant to 18 U.S.C. § 3663A," the Mandatory Victims Restitution Act (the Restitution Act). Notably, the Restitution Act mandates that a sentencing court order restitution in the full amount of the victims’ losses. 18 U.S.C. § 3663A ; United States v. Leftwich , 628 F.3d 665, 668 (4th Cir. 2010). With respect to the amount of restitution, the plea agreement stated that Boutcher owed "at least $7,500," but that the court ultimately would determine the appropriate amount.

Additionally, in the plea agreement, Boutcher agreed "to forfeit all interests in any fraud-related asset that [he] own[ed] or over which he exercise[d] control, directly or indirectly." Boutcher also agreed that the "conduct described in the charging instrument and Statement of Facts provides a sufficient factual and statutory basis for the forfeiture of the property sought by the government." And finally, Boutcher agreed "to waive all constitutional and statutory challenges to forfeiture in any manner[,] including direct appeal[,] to any forfeiture carried out in accordance with this [agreement] on any grounds, including that the forfeiture constitutes an excessive fine or punishment" (the forfeiture appeal waiver).

At a hearing conducted under Federal Rule of Criminal Procedure 11, Boutcher stated that he had a college degree and was not presently under the influence of drugs or alcohol. Boutcher also acknowledged that he had read the terms of the plea agreement, discussed those terms with his attorney, and understood them. After the district court discussed with Boutcher the terms of the plea agreement's global appeal waiver and forfeiture appeal waiver, Boutcher stated that he understood those terms. He also confirmed his understanding that the court could impose a restitution amount higher than the $7,500 amount referenced in the plea agreement, and that he likewise was subject to the imposition of an order of forfeiture. The district court accepted Boutcher's guilty plea under the above-stated terms.

The government later proposed a preliminary order of forfeiture against Boutcher in the amount of $227,512.07. In submitting this proposed figure, the government relied on an analysis prepared and submitted to the court by Rachel Bingham, a forensic accountant. Bingham concluded that $227,512.07 represented the profit that Boutcher and Tayal had derived from their fraudulent scheme. Despite Boutcher's claim that he had received only $7,500 of the profits, the government asserted that Boutcher should be subject to forfeiture of the full amount of the scheme's profits, including all the funds that had been deposited into a business bank account over which both men had "signatory authority."⁴

With respect to restitution, the probation officer proposed in the presentence report that restitution be set at $1,012,000, to compensate the five financial institutions identified as victims of the scheme. The government advocated for this amount of restitution based on Bingham's analysis. Depending on the particular transaction at issue, Bingham calculated the losses incurred by the various financial institutions based on either (1) the difference between the fraudulent short sale prices for the residential properties and the later refinancing amount obtained, or (2) the difference between the fraudulent short sale price and the sales price reached with a third party. Boutcher objected to Bingham's methodology and to the proposed amount of restitution, contending that only one financial institution suffered a loss totaling $3,182.27 in unpaid interest.

The district court initially stated at the sentencing hearing that it intended to set restitution at $7,500 based on the money Boutcher individually received from the scheme. However, the government maintained that if the court rejected the restitution amount of $1,012,000, the court should set restitution at the same amount as the forfeiture figure, $227,512.07, because this amount reflected the money within Boutcher's control.⁵ In accord with the government's argument, the district court ordered both restitution and forfeiture in the amount of $227,512.07. Additionally, the court imposed a three-year term of supervised probation.

In its final judgment, the court assessed $227,512.07 in restitution "pursuant to the Victim and Witness Restitution Act," an apparent misnomer that does not identify the name of any statute addressing restitution. However, the restitution order entered the same day stated that "pursuant to 18 U.S.C. § 3663A(a)(1) [the Restitution Act] the defendant is ordered to pay restitution in the amount of $227,512.07." And, in accord with the government's motion and the court's entry of a preliminary order of forfeiture, the final judgment directed forfeiture in the amount of $227,512.07, pursuant to 18 U.S.C. § 982(a) and Rule 32.2(b). Boutcher appeals from the district court's judgment.

II.

A.

Boutcher argues on appeal that the district court made several errors in imposing the orders of restitution and forfeiture. As explained in more detail below, Boutcher contends that the court's errors rendered its orders on restitution and forfeiture "illegal," an argument that Boutcher contends is outside the scope of both the global appeal waiver and the forfeiture waiver. In response, the government asks us to dismiss Boutcher's appeal, contending that his arguments are barred by the terms of both waiver provisions.

We review an appellate waiver de novo to determine whether the waiver is enforceable. United States v. McLeod , 972 F.3d 637, 640 (4th Cir. 2020) ; United States v. Adams , 814 F.3d 178, 182 (4th Cir. 2016). "When the government seeks to enforce an appeal waiver and has not breached the plea agreement, we will enforce the waiver if it is valid and if the issue being...