baker's condition should be reversed because the trial court broadened the the conduct the possible basis for conviction by instructing the jury on a deluded theory of liability that was due to presented to the grand jury no overturning the indictment and because this instruction expanded the range of conduct for which mr baker could guilty therefore cost us a constructor that amendment which requires automatic reversal and in the alternative the second issue i would like to address is that the district court erred in calculating mr baker's criminal history category he should have been in criminal history category five with the guidelines range of two hundred ten to two hundred sixty two months instead of category six with a range of two hundred ninety two to three hundred sixty five miles even with that correct range if i could start with your sentencing argument for a moment mr baker's sentence was well below the guidelines that would have applied even been the correct calculation of the criminal history what do we do with that that's correct your honor and frankly i just reviewed the government's twenty j letter where they acknowledge that my interpretation mr baker's interpretation of application of eleven is correct apparently they're still not making that argument that the sentence was nonetheless reasonable and i've not had a chance to see because the thirty month difference it was he actually got one hundred ninety four months i mean from the bottom end of the respect do the same thing in a way that could happen here again right that did not happen and it furthermore doing some research last night i intend to file a twenty j on this but this court has repeatedly l that even where there is an error in the guidelines calculations last eighteen months this court has held on plane air review that even though there was a sense that landed within the guidelines or was well below the guidelines the error in calculating the guidelines and selves warranted reversal for thank you but one thing that's been consistent there i should say if you outset that with respect to constructive amendment and variance the case is certainly within the district i mean within the circuits but also within the ny circuit court of specifically said that it is the exclusive parag of a grand jury finally to determine the charge of the charges and once it is done so either a prosecutor nor a judge can change the charge of part of an indictment to suit  his or her own notions of what it ought to have been or what the grand jury would probably have made it if their attention had been called to suggest a changed could charge itself change he did propose a change well because the indictment specifically alleged knowingly instruction and i looked at her ready of the case on that last night and this will also be in the twenty j letter but this court very specifically said in heredia that recklessness and negligence are two completely different things whereas willful blindness is sort of a subset of the knowledge recklessness or something else and that is what the government if the government wanted to convict mr baker on the theory of recklessness it should have asked the jury to return the diamond on the basis of this is a lesser vinyl state that went to the jury and it was never passed upon by the ranger so that the the effect of this was to expand the conduct for which mr baker for the been convicted of fact the love court addressed prejudice and there's no prejudice analysis in a constructive amendment case because it's automatic reverse so the love case is limited to two of the various argument that it addressed and i think the government agrees because that's how they framed it in their answer brief limited love to the variance context and not use the same reasoning in constructing them in the cases where i don't know that this is as come up again frankly your honor i do know that one of the cases the love cited within it talked about that a defendant may be properly charged with recklessness but that's my point exactly he mr baker wasn't properly charged and so with the extra to please the court my name's laurence lipman and i represent albert greenhouse appellant mr greenhouse who is huli or appellant in this matter as he was acquitted of the fraud charges and conspiracy but was convicted of the based on the change in the securities act and though after reading the brief of the government accepts the position that that would not be grounds for overturning the conviction i would like to say however that that does pork the position that i've argued throughout the brief that by the virtual lack thereof of the congress and the securities commission de criminal allowing the public solicitation to be done supports the argument of what i would see them in this offense is that it is not the the soliciting of the investors that is the fear or the solicitation in itself does not is not the fear of the risk of that particular securities requirement in that there was a prohibition of soliciting investors by to greenhouse in his sentence for loss to the victims and it's argued in a twofold argument that that should no off and the reason is this firstly the guidelines section to be one point one it submitted would not be a political although the the appendix say that this particular charge should go to that section that's what we use for a number of laws for as give the separate things so it says use the one on this is there are frost reference for this yaps for granted and it's points to this guideline yes and the district court applied the guideline you know so they applied the wrong guideline in terms of what the the guidelines say so what exactly is the legal flaw that the legal follows the application of the in has limits which we should think of because the heading of to be one point one his last name guidelines or simply your own policy sense of what the import of the fraud acquittal should be yes that's correct is that we will return you should only use the six points in this is what they intend to use this particular section for and you use an equivalent of about six points and so we accept that six points of this why wouldn't it make a difference if the unregistered securities were an enormous all right we'll all move then to the second argument which i submit the judge clearly erred in assessing and that's the argument that the loss that was sustained by these investors was not caused by mr green houses activity or the crime that he was charged up he was charged with selling a very strict securities through the telephone that did not cause these investors to lose money what caused investors to lose money was the movie fl and that's why there was no money to pay investors in addition this is true of all of the defendants is not yes but there was also money stolen there was money for there was activity by other people and that i would submit that you or you do what was supposed to have been done in this case was a private placement memorandum which allows you not for because it's an exception to the registration form if you and that issue a private place but memorandum which was done in this case and you have sophisticated investors which was done in this case louis where's the evidence of that in the record the evidence of the sophisticated investors where the forms that the individual victim sign saying that they were up in excess of one million or their in could isn't there a lot of evidence in the record that in fact these individuals had quite limited assets quite limited experience and that was known to that was not known as mr greenhouse so there was no evidence of the record that mr greenhouse knew until prialt his victims did not test his victims testified they did but they did not say that they told mr greenhouse that they didn't have this money he only found at trial that they didn't have this money they misrepresented to him in order to get the investment they could have said no i don't make that which case he would have the claim the the investment so it submitted that the the cost of connection as this court of appeal  stated must be twofold it must be a but for test which we accept but for him phoning these people they wouldn't invest if we accept that but that next connection is the props with cause which he did not proximate because this loss would proximately cause this loss was the other fraudulent activity of the of the president stealing the money was that an unforeseen to him or unperceived bullen is that a requirement yes i it is a requirement  conversation with adler who was a convicted and testified adler had testified that he wasn't receiving any commissions on this there's no evidence the greenhouse would have known what i believe was getting  act that caused this loss not the mere solicitation of these investors it wasn't the the phone calls that mr greene has brought in which is what he was convicted of that caused these these investors the loss morning your honor is catherine young from the federal public defender sophos for appellate david nelson i have four minutes and i'd like to reserve one for a battle so if the court wants me to focus on any particular issue given that there are a number of issues raised by mr nelson i'll be happy to do that debatable on the record come ahead ok i understand your honor i got my point also was that the government did not prove that begun the scribes alone or that while he was at this at the gun mr nelson made any misrepresentations and when the government sought to introduce the evidence th district court said repeatedly you have to prove it's fragile and he made misrepresentations and they never did that and therefore we argue that that was unduly prejudicial he also challenged the evidence regarding a check with a notation leads that mr nelson claimed was a repayment of a personal loan and mr nelson said that he did not sell the eads and the opening brief caught proved that mr nelson did not sell these and therefore it wasn't proof that he was involved in another movie boiler and the government's answering of just claims that that they were entitled to introduce it because it did not have to be relevant to the the nature of the charge defense but that was a theory that was not presented to the district court so which claiming that that evidence should not have been introduced either we also challenge the agner lay opinion evidence alan agood was also convicted testified based upon the few dozen closers he met as well as his own personal experience he was specifically asked to testify regarding all his experience and all the closers he had ever spoken to and said that no investor ever made money and that everyone line and we claimed that this was unduly prejudicial because he was designated to testify  instead gave lay opinion testimony far beyond the scope of lay opinion and it was unduly prejudicial we also challenge the victim impact evidence that the government introduced that was irrelevant specifically which impact evidence to you challenge and what's the standard of review given a lot of it was never objected to it was not objected to it we claim there we were challenging the testimony from mr better car for he said it was a financial hardship it was terrible he could not pay his bil any witness who could testify directly that mr nelson was aware of the use of shells on conference calls so instead they used a hearsay testimony that one closer referred to from another closer and i think although i haven't been keeping very good times that i made a quick she had to script there was the evidence of the script was found on his computer with the handwriting similarity to there was known there was evidence on the script he said that he had not seen that particular script because he had inherited the computer from someone i understand that's what he said but th what factors are more like studly which is the case you seem to rely on what have been a united states versus splits in each in thirteen the court relied upon the fact that it depended on the success of the entire operation for the financial compensation this was not the case with the california operation whatsoever i think that's what distinguishes it the floor operation obviously mr just given he was part of that but there's really no nexus with california operations so that's where we've got the big difference here what about the breed loads of his clients for which in california that he got commission payments for as i read the record that the district court of the yard twenty three specifically rejected the finding that the defendant participated in any of the reloading of his investor didn't participate but he knew that they were being reloaded it appears and he got money as a result i don't think that that's necessarily enough that that's you know looking at the stuff they reasoning and also even looking at the kids your honor cited i think there needs to be more than that there needs to be active participation i think one way to look at this is really we've got to conspirac sales were in the range of one point five two million and when i say those sales i'm talking about the people that he worked with except response of the entire florida office for the period of his employment you would agree is properly considered his relevant conduct plus whatever money he derived personally from the reloading of his earlier victims by the l a office is that really i think the line should be vs i think that is where the line should be drawn and i think that when he changed his plea that's what he was thinking as well and then still not responsible for that so i would ask the court to do is hold mr because chemically responsible for what he did do which was playing one for wire fraud count for all the conduct that he did in florida boyd had a good faith belief in the likely success of the venture as irrelevant toward sentencing the court then did list and number of aggravating factors under thirty five fifty three as to why mr lloyd  was actually fraudulent only when they included things like teaching people how to lie to pining i think was the word that's near and is true and those are pretty aggravating aggravating factors there aggravating i agree with that those factors believed that the movies had a good chance of producing income he lied he pled guilty to two counts of fraud we didn't contest the fact that he said use phrases like finding that he was out for the money and the argument essentially was that given the fact that mr lloyd did commit fraud given the fact that he did you know use some very sharp tactics these people that those factors do drive the guidelines if you didn't object to and that substantial sentence was warranted but we did take the position that the nature circumstances of the offense under thirty five fifty three supported a variance downward because he did show through his efforts loaning the money leaving sort of more when he became aware the fact that cinema was not going to distribute the films and there was a variance downward there was a v i say that because of this your honor i acknowledge that it's unique and i may be charitable to my to my position but the card said wish for the sentencing judge said that he found the guideline range did not adequately take into consideration the specific facts and circumstances of the case judge walter made and institutional he said for mr standpoint was just record judge is no longer like the fraud table and therefore they are varying from the fraud table judge walter also said in support of the downward variance that the specific facts and circumstances of the case support variance everything that he said prior to that was in aggravation when i when he was talking about under thirty five fifty three the nature of circumstances of the offense he deemed mr lloyd's argument that there was enough evidence to support a variance under way happened when in any of it i would please the court my name is ellen lindsey i'm an assistant in a tourney and los angeles and i did try the case so there are so many issues that what i thought i would do is just respond to what appear to me to be the court's biggest concerns from the government's point of view but obviously please interrupt me and tell me otherwise i i felt you briefly why the route testimony was relevant and now that the defendant greenhouse was developing this argument about how he took great care of his well so so if you're going to say that that is the most egregious or the most prejudicial victim impact testimony they acquitted him of the fraud so i think it demonstrates that the victim impact testimony didn't really have an effect in undue emotional effect on the jury because if it had that very very sad testimony would have gone to mr greenhouse so that was that issue i wanted to talk a little bit about the  get stuck with some of the lawyers lost but only maybe those people who were who were reloaded and he gets the commissions seem quite extreme when this guy is off and florida and doing  doesn't seem to be so it's not part of his conference cause is there right now and he is not in jail in contact with any of these people well i would have maybe seller sellers but i and well i think it is covered by blitz but also maybe more on point it's covered by the boat near case and i believe that it's either the fifth circuit or the seventh circuit but the boat your case is the one where there was a staged accident insurance everybody everybody pursued their own separate insurance claims and the circuit held that yes they could they should be responsible for each other's and the key is just is the key is yeah right well yes but then you could say they had private placement memorandums they had the brochures they had all of the promotional materials they had the common actors and what they were saying about the movie but the key is that they were working together for a common goal what is the common goal as far as  because it doesn't seem that he more money that his the success of the florida fundraising did not seem to depend on the success of b l a fund raising well it does our honor and that the common goal as in the boat in our case and then there's another aspect to it and that is that mr kiss cam that he did not just benefit from the conference calls because he got some commission from them he benefited because the conference calls not only raised more money but the conference calls were also allowing technique they kept the victims from  feeling ignored that kept them calm that fed them false information to keep them from going to the authorities so when you say that well maybe because kennedy benefited because of the commissions he actually benefited from the criminal activity with this common goal of working towards raising i keep going oh ok so i may be calling you judge clifton the way i'm going that would really be so so i think it's good to contrast this with the drug type cases because in one of these drug type cases you have the  has the drugs and he gives them to his people on the street and they all go out and sell and it doesn't matter for this drug runner if this drug runner sells or not however for kids scammony it didn't matter that these conference something in the main office is occurring to keep his victims from going to the police and from exposing it as you know that because it just seems to find that he doesn't you know the judge just found that he didn't know about the conference calls that we had in that case there was a defendant named robert ramirez and robert ramirez's whole job was to do customer service customer relations and scammony eventually started doing that himself  if it would be in the record but the fact that he was customer service and it certainly if you are customer service it was we can't base the cancer and sentence is reasonable based on something that the judge didn't find or something that's not the record well the judge did find that case chemically benefited from the hole and benefiting from the whole operation is different from just knowing whether there were conference calls or not so he's raising money in florida he knows money is being raised elsewhere how is he benefited by the knowledge that money is being raised elsewhere well he's benefited a in the fact that the organization continues to go on and also in these cases the the money the overhead was eating everything up with more money coming in there is more but he's not using that money well but he's getting the pro sure that are being printed by the main organization he's getting the p p m he's submitting his paperwork to the main organization it's all the money is what the exact cons i mean one consequence of this difference between one and i guess that would lead into another argument is if the sentence is below the guidelines that he would get anyway the government argued several instances here do you base this on our case law absolutely on the fact has to show a prejudice and is in offense to the judicial system and where you have a situation where the sentence is below the guidelines even if you take into twenty local unhandsome and for the frog last driven by the finding that the relevant conduct extended to los angeles as i read it and then he got a six level i'm handsome and for a large number of victims that would have covered both offices so he's getting hit pretty so on the criminal history issue with defendant baker i think what the government is saying here is that it is a plain error because he didn't object  on on this footnote or the note eleven issue and since it's plain error it's up to him to demonstrate that he was prejudiced if he had raised the error in the district court then the two other questions this is very confusing but the questions are whether for the revocation the revocations were imposed on the same day and below so there's no reason to remain because he can't he can't show that there was an ad that the premise usually is that he's you can see that the standard case is an error in calculation if you go back and find out what would have happened you you re sentence this is playing error so there's an obligation on defendant to establish some degree your prejudice but in the ordinary carry swe start with the correct guidelines calculation what is there anything in particular about this case that tells us that no this change in calculation would not have had in the impact on what the district court did or are we just in a state of ignorance we really don't know not for no no no i think what i'm saying is that that i would concede if there's an error in the guideline calculation under normal review the analysis for the footnote eleven and i may be able to articulate this a little more clearly as i read the letter it's not a very long letter it's basically saying i thought what i said which is that you're saying the burden is on looks that way but i don't think that's plain or this is wrong as you think it is that i think yes exactly it's that's kind of how strong it is and that the burden is on the defendant since he didn't object below on that particular basis because if he had objective below it would have allowed the parties in the probation officer to go and look more closely into see if there is an error just in the fact that it says they were on different dates etc but since the in that time frame right so but then there are but it's not only a guess it's a pretty good guess if you if there's a discrepancy in the dates as to when the census form tolls it doesn't really matter right and then it's but it's also whether the revocation was for the same conduct because i think there were like five offenses that he committed and so but but i think it's a pretty good guess doesn't make plain error so i think that's why the standard of review guideline calculation results from my book for me ok from the bible history calculation being well i think incorrect ok i still think it's a defendant's burden to show that there actually wasn't asked but the question is burning let's say it's more i don't think it's more likely to not burn something less but say it was more likely that well i think he has to show that it offends the judicial  victims don't read these documents how do you know that somebody told him because he testified that he relies on the fact that the victims don't read the p p m because if they do they ask him the hard question so it's not he is not testifying to the victims told me they didn't read the p p m he's testifying to i was able to sell this way because in my experience they don't read the  will tell them these things and they don't ask the right questions they don't know what to say they don't know what to answer you are just screwed they ignore disclosures say something about that they never none of these things are made money and you know that he testified in my experience the movie rooms that i've worked in my victims have never made money the reason he would know that is not because they tell him i made money or i didn't it's that if distributions go out he is able to very easily reload they all want to the victims to get money back so that they can try to get them to to send in more money so all of these things are in his experience and he's not he didn't testify if you look at in my experience they didn't make any money because i was having to love them and give them excuses that's what the conference calls were for till all them give them excuses this is why you're not getting any money back yet blah blah blah and meanwhile while we're talking about that let's invest some more money he testified that everybody lies that would be in his experience of working in the room and reloading victims who have been  who have been pitched by other people so in our in other words it was all within his own experience and not hearsay that he was testifying to but it was really with going on some levels within their own experience because he has no narrow question with regard to what happens with people you don't with is that just the common understanding in the room well i think that's that's a fair question though in his experience you're sitting here in the room and  because he is he is testifying about the fact that these movie rooms all operate in a certain fashion in a certain way and also the answers to these questions or the these questions were not objected to as was wrongful expert opinion so these also are judged under the plain error standard and from my experience everybody there her work with w certain that everybody was trying it said in his experience to white heat what is testifying his experience was this goes away with the concept of expert testimony only one i know because an expert testimony is based upon hearsay and a specialized knowledge this is not a specialized knowledge this is like the case that i cite where somebody is talking about proposed profits from the business and that's because they in this case though we had extremely detailed testimony about how the defendants were hiding their commissions from each of the defendants who testified or sorry who went to trial all of their victims testified that they do come elsewhere in his testimony he does talk about the the invest the salesmen understanding that the investors don't rely on you know what he understands how does he know what other salespeople understand well i think then you could say that he he would be talking to the other salesman in those boiler rooms who w and it wouldn't be hearsay and what this court says is that expert testimony is based on on hearsay and specialized knowledge this was just his knowledge as the district judge found this was just his knowledge from working in these room what part of his testimony you're talking about and i think that would go to some of their knowledge and experience their intent to defraud and a lot of the defense was for no no only at the very end of the objections on this one session only at the very end it was a motion to strike the whole testimony only at the very end it was the intermittent objections were  relevance and that kind of thing they were not the proper objections and to the extent that they that the defendants weren't on notice i mean they they had received all of mr greenhouse because he didn't work with mr baker directly and he didn't work with mr nelson directly and mr greenhouse again was that that's the whole problem with this task of mine which is insofar as he testified specifically yes but in so far as are standing up there and talking about what everybody knows about everybody then how could it be limited well what i think the argument that i was trying to make your honor is that it obviously wasn't even even if it was wrongful even if it was error it obviously wasn't prejudicial because mr greenhouse who mr adler was testifying very specifically as to he was acquitted of the fraud and then the other thing that i think it's very important to look at way what the jury saw was in closing we put power point slides of the known handwriting against the have the circles on the lines and everything that it wasn't the person we know now we just that's how i argued it in closing that we didn't have a handwriting expert but you could certainly it this circuit does not require handwriting expert to jury is is perfectly able to tell and this was the the i think we made it clear though that we were just showing this for the courts at it but the jury we can't really put the power point slides in there but i mean that everything that was a circus and all eyes were essentially the up the power point and saying look at this and look at this and that this was a fan comparison i cannot say for certain that every single little circle was but the main comparison and the one that made actually made so many in the courtroom gasp when it was put up was the word wife that was the big comparison so  ira and then the known writing of the person that big gun and so that was kind of the smoking gun we didn't have a handwriting expert because i did not anticipate at all that mr nelson would actually get up and say that he wasn't that he actually left the conference calls we had no idea he was going to say that and it was it was crazy so the handwriting saying came up at the end but i don't think you need a handwriting expert for the jury to be able to look at those and say that's the same person that wrote that yeah that was that was very interesting time because the other side we have a little extra time or was there evidence that the gun operation was fraudulent doesn't matter first of all i think it is this court is very clear that if there's no evidence of fraud it simply isn't prejudicial the problem it's not the answer well i think first of all what i'm saying is that the defendant's exact argument in that regard has been rejected by this court in the blitz case in the melding case  so i think you would have to rule over rule another panel in order to say it does matter but i do think there was evidence of fraud that this was a an old man that mr nelson went in and took him for much more money than he really had to give that nobody got any money back from the big gun raise etc and what about the check to mr slanted her the one that is the the nineteen months after the fact is well again it said leads now we didn't again until trial until the check was already in evidence we didn't know that nelson was going to come up with this explanation that it was a personal loan and that it really wasn't leads but when you have somebody who's arguing that he never would have been involved in fraudulent telemarketing had he known that they really weren't doing what they said i do think it's relevant to the case to say nineteen months is not too long that he's actually going on and selling leads and he testified himself that he wouldn't have worked there because it was a fragile an operation ok thank you very much your honor shot will hear from  to the foundation lack of foundation for that opinion testimony twice at one thirty nine and again and you are one four six does it matter mr i glue could have qualified as an expert well i does because they weren't provided notice and then at the end of the testimony after already having two of his foundation objections over rule the counsel for mr baker moved to strike the opinion testimony specifically on the basis that it was on the list of opinion testimony and that he did not have an g us for mr baker because mr baker failed to object that also is frankly a misstatement of the record mr baker's counsel specifically objected that he should not receive criminal history points for both revocation sentences  heard on the same day that he did not make the specific argument that i made under application of eleven but he did specifically object the sentences occurred in the same day so they should both count in response to that the probation office filed in a denim to the pre sentence report which the government adopted which said too bad you lose because there's an intervening arrest in research and then the court later adopted that and that is at you are thirty two and as you are one the court i believe it's in your thirty two where the court expressly adopted the position of the government and the probation office that because there was an interven school so if there's any ambiguity in the record which the only logical interpretation is that those sentences were imposed on the same day that ambiguity is the fault of the government and probation for not flushing out the record mr baker so with that i appreciate you all this time horrific and mr greenhouse was still not convicted of fraud shows that the victim impact testimony had no impact but in fact mr greenhouse are not that familiar with this case he was in florida i think there was evidence he didn't even know the p p and here you've got disputed evidence nelson said i was told the things that i relayed i was told they were pre sales and so i relay that information to investors he's got disputed evidence and that's where some prejudicial evidence like that can in fact evidence can have an effect i also want to address the a all your own personal experience and over closer to work in these rooms that you've spoken to have you ever heard of any investor making money so he adds i was specifically asked not limited to exit experience but all of the dozens of closures he talked about and all the other room at big gun for a certain amount of money now she was only one of three closers it wasn't really i think established how much of the investment was attributable to nelson as to push it to other closers the other thing was i think that victim had something like three million dollars so you're not talking about lie they were fired and in fact the person who was in charge of it yet invested his own money to try to make up to the investors there was no evidence of pot or misrepresentation ok thank you but my first thing when i thin probation report and there's a very good chance of the district court would have given him a much lower sentence if the guidelines have been calculated properly in this particular case i think the point the court needs to go back to is the e r d r e r says a very very clearly the district court rejected the finding that the defendant participated in the reloading of his investors finding that there was no evidence that he was even aware of it and we have to accept that because the district court was in the position to see this i'm correct there's nothing that i can see and there is well in the district cour found that he did not in any way benefit from the costs there was no benefit so when you look at everything he earned his commissions based on the florida office soley he ran the office in florida he did not court it with l a though he came into the picture many years later and my client didn't even want mr mudd to be hired he didn't share knowingly share any kind of investors in this with mr lloyd and he did not know from the beginning that there was even going to be this whole california operation they did not have to in these it is these other cases talk about they were not all acting in concert that's what distinguishes the blitz in the boat or in the sunlight of sin mind of cases because in those cases everybody was in it i wouldn't be up here right now if they'd share their commissions on a national basis but they didn't this is about one selling of those securities the investors knew that they could lose money it was forseeable to them that they would but they could lose money but it was not forseeable that they would lose money because of the crime he