United States v. Gonzales, 16-2022

• Decision Date: 29 December 2016
• Docket Number: No. 16-2022,16-2022
• Citation: 844 F.3d 929
• Parties: United States of America, Plaintiff–Appellee, v. Jasonn Gonzales, Defendant–Appellant.
• Court: U.S. Court of Appeals — Tenth Circuit

844 F.3d 929

United States of America, Plaintiff–Appellee,

v.Jasonn Gonzales, Defendant–Appellant.

No. 16-2022

United States Court of Appeals, Tenth Circuit.

Filed December 29, 2016

Brian A. Pori, Federal Public Defender, Albuquerque, New Mexico, for Defendant–Appellant.

James R.W. Braun, Assistant United States Attorney, (Damon P. Martinez, United States Attorney, with him on the brief), Albuquerque, New Mexico, for Plaintiff–Appellee.

Before HARTZ, MURPHY, and HOLMES, Circuit Judges.

HARTZ, Circuit Judge.

Defendant Jasonn Gonzales pleaded guilty in the United States District Court for the District of New Mexico to four counts of mail fraud, see 18 U.S.C. § 1341, one count of conspiracy to commit mail fraud, see 18 U.S.C. §§ 1341 and 1349, and one count of aggravated identity theft, see 18 U.S.C. § 1028A, arising out of his fraudulent scheme to obtain unemployment benefits from three state agencies. On appeal his sole argument is that the district court erred in calculating his sentencing-guidelines offense level by including as victims those persons whose identities had been stolen even though they suffered no financial loss. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

I. BACKGROUND

From January 2009 through May 2012, Defendant and Gerald Archuleta tricked unemployment agencies in Texas, Colorado, and New Mexico into sending them prepaid debit cards for unemployment benefits for unqualified people. They registered fake companies with the agencies and paid unemployment taxes for them, listing real people (with correct social security numbers and other personal information¹ ) as employees of the companies. They then submitted unemployment-benefit claims on behalf of those people. The unemployment agencies mailed the debit cards to post office boxes rented by the two men, who used the cards for their personal benefit.

Law-enforcement officers searched Defendant's home on May 22, 2012, and found substantial evidence of the scheme. For reasons not apparent in the record on appeal, Defendant was not indicted until almost two years later, on March 26, 2014. He pleaded guilty on August 18, 2014, to all charges without the benefit of a plea agreement.

When calculating Defendant's offense level for the mail-fraud and conspiracy charges, the probation office's presentence report (PSR) started with a base level of 7. See USSG § 2B1.1(a)(1) (2014) (guideline for theft offenses).² It raised the level because of three special offense characteristics, adding 16 levels for an intended loss over $1 million, see id. § 2B1.1(b)(1)(I), two levels for Defendant's use of sophisticated means, see id. § 2B1.1(b)(10)(C), and four levels because the number of victims exceeded 50, see id. § 2B1.1(b)(2)(B). The PSR then added four levels because Defendant was an organizer or leader, see id. § 3B1.1(a), and subtracted three levels for acceptance of responsibility, resulting in an offense level of 30. With Defendant's criminal-history category of II, his guidelines sentencing range was 108 to 135 months' imprisonment. For Defendant's aggravated-identity-theft conviction, the PSR added the mandatory consecutive two-year prison term. See 18 U.S.C. § 1028A ; see also USSG § 2B1.6 (guideline for aggravated identity theft).

Defendant objected to the number-of-victims enhancement on the ground that the only financial losses from the scheme were suffered by the three state agencies. The PSR counted 107 victims, however, because application note 4(E)(ii) to USSG § 2B1.1 defines victim to include "any individual whose means of identification was used unlawfully or without authority." Defendant argued that the application note could not be used in calculating his sentence because he was also being sentenced for aggravated identity theft under 18 U.S.C. § 1028A, and for someone so sentenced application note 2 to USSG § 2B1.6 prohibits applying any enhancement "for the transfer, possession, or use of a means of identification." At sentencing on December 4, 2014, the district court overruled the objection, adopted the PSR's guidelines calculation, and varied downward for an ultimate sentence of 111 months' imprisonment.

II. DISCUSSION

Several guidelines provisions are central to our discussion. Section 2B1.1(b)(2) states: "If the offense ... involved 50 or more victims, increase [the offense level] by 4 levels." USSG § 2B1.1(b)(2). Application note 4(E) to that section defines victim where, as here, the case "involve[s] means of identification." The note incorporates the general definition in application note 1³ but also includes within the definition of victim "(ii) any individual whose means of identification was used unlawfully or without authority."⁴ These are the provisions used by the district court.

Defendant's arguments rest on an application note to the guidelines provision concerning his conviction for aggravated identity theft under 18 U.S.C. § 1028A. The guideline states: "If the defendant was convicted of violating 18 U.S.C. § 1028A, the guideline sentence is the term of imprisonment required by statute [two years]." Id. § 2B1.6 ; see 18 U.S.C. § 1028A. Application note 2 to that section provides:

If a sentence under this guideline is imposed in conjunction with a sentence for any underlying offense, do not apply any specific offense characteristic for the transfer, possession, or use of a means of identification when determining the sentence for the underlying offense. A sentence under this guideline accounts for this factor for the underlying offense of conviction, including any such enhancement that would apply based on conduct for which the defendant is accountable under § 1B1.3 (Relevant Conduct).

USSG § 2B1.6, cmt. n.2. (emphasis added)

Defendant contends that this provision forbids use of application note 4(E) to enhance his sentence. He argues that there were only three victims of his scheme—the three state unemployment agencies—because they are the only ones who suffered monetary loss. The other "victims" counted by the PSR were counted only because they were "individual[s] whose means of identification was used unlawfully or without authority." USSG § 2B1.1 cmt. n.4(E). But, the argument continues, counting them would be a prohibited application of a "special offense characteristic for the transfer, possession, or use of means of identification." Therefore, he says, the four-level 50-victim enhancement was improper.

Defendant focuses on the guidelines' use of the word any in application note 2, arguing that the word requires a broad reading, "proscrib[ing] application of all [special offense characteristics] of whatever kind ‘for the use of a means of identification.’ " Aplt. Op. Br. at 19. Noting that the express purpose of note 2 is to prevent double-punishing a defendant who improperly uses another person's identifying information, he suggests that his conduct was double-punished because he received both the two-year consecutive term under § 1028A and the victim enhancement for the same conduct. He contends that the application note is unambiguous, but that even if it were unclear, the rule of lenity directs us to interpret it in his—the defendant's—favor.

This argument, however, appears to be foreclosed by circuit precedent. In United States v. Manatau , 647 F.3d 1048, 1048–49 (10th Cir. 2011), the defendant pleaded guilty to bank fraud and aggravated identity theft arising from his stealing and using social security numbers, credit cards, and checks. In calculating the defendant's offense level, the court counted the number of victims based on application note 4(C) to § 2B1.1 (2009), which at that time defined victim "[i]n a case in which undelivered United States mail was taken." The definition included "any person who was the intended recipient, or addressee, of the undelivered United States mail." USSG § 2B1.1 cmt. n.4(C) (2009). Almost none of these "victims" sustained actual monetary harm.

Mr. Manatau contended on appeal that it was error to apply this enhancement, raising the same argument advanced by Defendant here—that the enhancement was forbidden by § 2B1.6 application note 2 because of his conviction under 18 U.S.C. § 1028A. We agreed with him that "the guidelines tell courts not to apply an enhancement based on a ‘specific offense characteristic for the transfer, possession, or use of a means of identification,’ where ... a defendant has been convicted of aggravated identity theft and bank fraud." Manatau , 647 F.3d at 1057 n.4 (quoting USSG § 2B1.6 app. n.2). But we held that "the number of victims is not such an offense characteristic." Id.

Defendant argues that Manatau is not controlling because "[n]owhere in the ... opinion or in the briefs in that case is there any mention of § 2B1.1's application note 4(E)(ii)." Aplt. Op. Br. at 21–22. He adds that "[i]t is not even apparent the district court in that case applied that note since the defendant's offenses occurred before the note went into effect on November 1, 2009." Id. at 22. Therefore, he says, this court has not yet addressed the implications of note 4(E)(ii).

Defendant is correct that note 4(E)(ii) was not in effect when Mr. Manatau was sentenced. But our broad language in Manatau did not restrict itself to any particular definition of victim in the number-of-victims enhancement. We said without qualification that "the number of victims" is not an offense characteristic encompassed by application note 2 to § 2B1.6.

Even if Manatau is not strictly controlling, we agree with it and apply it here. Defendant conflates the nature of the crime and the extent of the crime. Application note 2 states that a guidelines enhancement based on the nature of the crime—"the transfer, possession, or use of a means of identification"—cannot be applied to a defendant who is also being sentenced under 18 U.S.C. § 1028A. But it does not restrict an enhancement based on the extent of such a crime. In that circumstance there is no double counting. In particular, using the...