United States v. Mercado
| Docket Number | 22-1947 |
| Decision Date | 29 August 2023 |
| Parties | UNITED STATES OF AMERICA v. LUIS D. MERCADO, Appellant |
| Court | U.S. Court of Appeals — Third Circuit |
Argued on June 29, 2023
On Appeal from the United States District Court for the Middle District of Pennsylvania (D. C. No. 1-21-cr-00337-001) District Judge: Sylvia H. Rambo
Ronald A. Krauss, Esq.
Jason F. Ullman, Esq. [ARGUED]
Office of Federal Public Defender
Counsel for Appellant
Christian T. Haugsby, Esq. [ARGUED]
Paul J. Miovas, Jr., Esq.
Carlo D. Marchioli, Esq.
Office of United States Attorney
Middle District of Pennsylvania
Counsel for Appellee
Before: JORDAN, KRAUSE and SMITH, Circuit Judges
Actions speak louder than words. So when a defendant continues to engage in criminal activity following a guilty plea, that post-plea conduct may bear on whether he has genuinely accepted responsibility for his crime of conviction. In this case, Appellant Luis Mercado asks us to conclude precisely the opposite. He asserts that § 3E1.1(a) of the Sentencing Guidelines, which permits a district court to reduce a defendant's sentence if he can "clearly demonstrate[] acceptance of responsibility for his offense," U.S.S.G. § 3E1.1(a), unambiguously precludes a district court from considering post-plea conduct "unrelated" to that pled-out offense. Opening Br. 7.
Yet the plain text of § 3E1.1(a) contains no such limiting principle. Instead, the commentary to this provision sets forth a list of "appropriate considerations," several of which expressly sweep in post-plea conduct. U.S.S.G. § 3E1.1 cmt. n.1(A)-(H). And where, as here, commentary helps to clarify a Guideline's "genuinely ambiguous" text, that commentary may serve as an authoritative delimiting mechanism, provided that it is both "reasonable" and invokes the Sentencing Commission's "substantive experience." United States v. Nasir, 17 F.4th 459, 471 (3d Cir. 2021) (en banc). For the reasons explained below, the commentary to § 3E1.1(a) satisfies these criteria, and the District Court did not clearly err in relying on Mercado's post-plea misconduct to deny his request for a § 3E1.1(a) reduction. We will therefore affirm.
For a full year starting in August 2020, Mercado filed fraudulent Pandemic Unemployment Assistance claims on a weekly basis, collecting a total of $37,555 in fraudulent benefits. When the Government caught on a few months later, it opened discussions with Mercado, who waived indictment and entered into an agreement to plead guilty to an Information the Government filed the same day, charging him with wire fraud in violation of 18 U.S.C. § 1343. Among other things, that plea agreement endorsed the possibility of a downward adjustment under § 3E1.1(a) if Mercado could "adequately demonstrate recognition and affirmative acceptance of responsibility [for his offense]." App. 28-29.
Mercado entered his guilty plea a few weeks later. At the plea hearing, Mercado "apologize[d] for what [he had] done," id. at 57, and the District Court continued his bail pending sentencing, including several conditions of bail relevant to this appeal. Specifically, the District Court required, in relevant part, that Mercado "refrain from use or unlawful possession of a narcotic drug or other controlled substance"; "submit to substance abuse testing"; "complete a substance abuse evaluation and treatment if deemed appropriate by pretrial services"; and "get medical and psychiatric treatment if directed by pretrial services." Id. at 58.
Mercado's compliance proved problematic from the start. On the same day he pleaded guilty, Mercado tested positive for cocaine. Probation referred him for intensive outpatient treatment, but he never reported for his counseling sessions and was terminated without having completed the program. In January 2022, Mercado admitted to using cocaine again, and two months later, he refused to take a follow-up drug test. When he finally submitted to testing in April, he again tested positive.
In its Presentence Investigation Report, the Probation Office calculated an offense level of 11 and a Criminal History Category of II, resulting in an applicable Guideline range of 10 to 16 months' imprisonment. A two-point downward adjustment for acceptance of responsibility under § 3E1.1(a) would have produced a Guideline range of 6 to 12 months' imprisonment. But the Probation Office recommended against it. While the Probation Office recognized that Mercado had expressed remorse for committing the instant offense, it concluded that he had not clearly demonstrated acceptance of responsibility for the offense in view of his post-plea conduct, including cocaine use and failure to complete substance abuse treatment.
In response to Mercado's objection, the Probation Office also issued an addendum, adhering to its original recommendation. Relying largely on the commentary to § 3E1.1(a), the addendum explained that a defendant who enters a guilty plea is not entitled to an adjustment based on acceptance of responsibility as a matter of right, see U.S.S.G. § 3E1.1 cmt. n.3, and that courts can consider a defendant's "voluntary termination or withdrawal from criminal conduct or associations," id. cmt. n.1(B), and "post-offensive rehabilitative efforts," id. cmt. n.1(G), in determining whether a defendant qualifies for a reduction for acceptance of responsibility.
The District Court held a sentencing hearing in May 2022. When given the opportunity to address the Court, Mercado again expressed remorse for his actions:
I want to apologize for what I've done first. Right now I have motive for life to continue living .... I have a new partner, a new friend, and I want to give everything that I can to her. I have a good job.... And I want to work hard to get out of this darkness if I can get a chance to do that. Something else, I watch out for my mother. My sister and myself are the ones that are in charge of taking care of my mother. I know I can do it, and I trust in God that I can do it if I have the opportunity.
App. 61. The District Court, however, was not persuaded and declined the two-point adjustment. By way of reasoning, the Court referred to the "ongoing episode" of Mercado's drug use and referenced a memo from Mercado's Probation Officer confirming Mercado's most recent positive drug test. Id. at 60. Ultimately, the Court sentenced Mercado to the bottom of the applicable range, 10 months' imprisonment, and strongly recommended that he receive all available drug treatment while incarcerated. Mercado now brings this timely appeal.
Mercado raises only one argument on appeal: that the District Court erred by denying him a § 3E1.1(a) adjustment based on the "irrelevant post-plea conduct" of his continued drug use. Opening Br. 2. According to Mercado, the operative language of § 3E1.1(a)-requiring a defendant to "clearly demonstrate[] acceptance of responsibility for his offense"- unambiguously precludes a district court from considering such conduct. The Government, on the other hand, contends this language is genuinely ambiguous, enabling courts to consult the list of "appropriate considerations" in the commentary, including "voluntary termination or withdrawal from criminal conduct or associations," U.S.S.G. § 3E1.1 cmt. n.1(B), and "post-offense rehabilitative efforts (e.g., counseling or drug treatment)," id. cmt. n.1(G).[2] To resolve that question, we apply the three-step framework set forth in United States v. Nasir, 17 F.4th 459 (3d Cir. 2021) (en banc). First, we ask whether a Guideline provision is "genuinely ambiguous" by "carefully consider[ing] the [Guideline's] text, structure, history, and purpose." Id. at 471 (quoting Kisor v. Wilkie, 139 S.Ct. 2400, 2415 (2019)). If the Guideline itself is unambiguous, our inquiry is at an end, and we simply disregard the commentary. Id. If the Guideline is instead ambiguous, we proceed to step two and consider whether the corresponding commentary is "reasonable," i.e., within "the outer bounds of permissible interpretation," id., but we "accord the commentary no weight" when it "expands the definition" of a term within the text of the Guidelines, United States v. Banks, 55 F.4th 246, 258 (3d Cir. 2022). At the third step, if the commentary reasonably interprets an ambiguous provision, we ask "whether the character and context of the agency interpretation entitles it to controlling weight." Nasir, 17 F.4th at 471. In other words, we afford that interpretation so-called Auer deference only if it "implicate[s] [the Commission's] substantive expertise" and "reflect[s] fair and considered judgment." Id. (citations omitted). We consider § 3E1.1(a) at each step below.
To discern if a Guideline is "genuinely ambiguous," id., we look to contemporary "dictionary definitions while keeping in mind the whole statutory text, the purpose, and context of the statute, and relevant precedent," United States v. Brow, 62 F.4th 114, 120 (3d Cir. 2023) (citation omitted); Adair, 38 F.4th at 348, 350; Banks, 55 F.4th at 257.
Section 3E1.1(a) authorizes a downward adjustment when a defendant has "clearly demonstrate[d] acceptance of responsibility for his offense." U.S.S.G. § 3E1.1(a). The parties here largely agree on the applicable definition for each individual word in that text. They agree, in other words that a defendant satisfies his burden under § 3E1.1(a) if he can "show clearly" by "evidence" that he "t[ook] . . . with a consenting mind" "moral, legal, or mental accountability" for his "infraction of law," as reflected by his "contrition, remorse, and ownership of action."[3] Answering Br. 14-15, 21; Opening Br. 12,...
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