i'm victor sherman the attorney for the appellant in this matter your honor the defendant was arrested in april of two thousand and two at the time that he was arrested the government had observed him involved in alleged  credit card fraud and during the plea negotiations the parties agreed that the maximum amount of fraud involved in the case was less than fifty thousand dollars the defense was actually only seen in transactions involving around pretty two hundred dollars but there were some credit card numbers on his computer etc so it was agreed that the maximum effort was either four or six levels at the time the government threatened the defendant and his reluctantly in order to protect the defendant primarily to protect his daughter he agreed to pay seven hundred fifty thousand dollars even though that was not a penny of that seven hundred fifty thousand dollars that was traceable to any illegal activity the defendant nationally paid from bank accounts four hundred fifty thousand dollars and agreed to pay the other three hundred thousand dollars he and his daughter over a period of time approximately a year and a half later i think you're heading we don't have much time and i have a number of questions for you i think the argument you're leading up to is that the governments should have taken the money for the forfeiture when they were going to charge him a second time based on his revitalization is that where you're heading i am client had reoffended the exact same contract that he was committing the act committed previously and he entered a plea of guilty to and looks from the record that they were there's not really an explanation but i imagine that the investigation was ongoing he was continuing with his obligation under the plea agreement to make his payments regarding forfeiture restitution wasn't it as it was for if it was a fiction gr criminal forfeiture your honor so what's the authority ok the first of all the the other argument that i want to be and i want to be sure there's enough time is that after this breach they went back and decided to take the amount of numbers on the computer that was found at the time of his original arrest and then multiply that figure by five hundred dollars even though there was no showing that any of those numbers had ever been used were intended to be used and they were all deleted so th e stronger argument the better argument that i want to make is regarding that five hundred dollars but as well that's when we should go either one of them i think i'll let me answer your question the point of the matter is regarding that is the fact that when the defended really offended the government knew that they were going to declare a breach the definitive that time owed about one hundred fifty thousand dollars on this forfeiture the government then waited until he had paid almost that entire one hundred fifty thousand dollars and then declared a breach after sixteen months during that period of time they continually sent letters to me saying pay this money pay this made money pay this money knowing that they never intended to carry out the plea agreement between the defendant and the government so they were using that  couldn't withdraw from the plea but as far as an obligation to pay the funds the government in essence took that money knowing that they never intended to comply with their end of the bargain so in getting the additional one hundred fifty thousand dollars from the defendant over this period of time clearly was a bad faith attempt by the government to make the defendant to believe that the government was going to continue to abide by the plea agreement so they could get the money and part of the contract is that you're side will do something the other side will do something and you know that you never intend to do your side of the bargain but you want the other side to continue doing their side of the bargain until they have completed all of their obligations and at the end of that contract you say oh by the way a year and a half ago you breached the agreement i let you believe that we were going to continue our side of the bargain and now you've paid all this money at the end of it now that i've got what i wanted out of the agreement i want to call the agreement null and void any contract law under those circumstances would be bad faith on the part of the person that is allowing the other party to believe that they were going to carry out their part of the obligation but idea even if the terms of the contract itself the contract itself says that the government has a right to do that ok but they're not telling you that they're going to read the contract doesn't require the government to tell you what they're going to do but the contract is saying if you do this we're going to do that stipulated plea at least in my understanding means that if the parties in turn into an agreement only if certain things were made if anybody breached prior to actually being sentenced the district court could then reevaluated at that time but it looks like this was just a regular plea which into regular plea agreement there was no basically the government started out by the right word is extorting the defend that the government said to the defendant if you pay x dollars which has no connection between you and any criminal behavior we're not going to file additional criminal charges against you so they were having a hammer over the defendant said and said if you pay seven hundred fifty thousand dollars we're definit breached the agreement by committing a new offense but once he breached the agreement the government did not declare a breach at that time they never been told him they were going to declare a breach they let him believe over the next sixteen months continue pay your money you do your obligations and we're not going to tell you by the way that we're not going to carry out our side of bargain we just want this money from that you know that you don't have any evidence this is you don't have any evidence that this was bad faith on the part of the government it sounds like you're speculating with respect to that well there we don't have any evidence before morris that you're in the record your honor at the time of the defendant's breach the government conducted surveillance for like a couple of weeks and they did nothing for sixteen months and the only argument that the government makes in its brief is well they had other administrative duties and they didn't have time to go after the dome why would they have to do it the next day i don't mind i don't know i say they have to do it the next day but they lead to the definitive believe by may continue to make these payments that they were going to give him some credit for that so they got over one hundred fifty thousand dollars that was part of the credit that he was supposed to get for paying the want to move on because i think you have bigger fish to fry here paul cousin when i go on to the well you don't have much time but i mean i ask you so on the two thousand and fifteen charge and the judgment of conviction that's not before us it isn't so  i'm not quite sure what we're supposed to do about it i'm not asking you do anything about that i'm asking you only to do with the sentence on the original case which was for years now that that sentence was enhanced because after the breach the government then went back and said well there's these twelve hundred eighty c eighty seven deleted numbers in the computer and now we're going to multiply that by five hundred dollars and we're going to get it we're going to ha device enhanced meant but they never can first of all the government concedes in the brief that these numbers were never used and they were never connected with any person they were put into the computer by somebody in the years two thousand and ni court judge made a determination it sounds like there was enough circumstantial evidence along with ancient oryx you know declaration talking about who had specialized training in credit card fraud in counter and identity fraud and his testimony regarding where those numbers were found you know you know under the government the judge did not rely on iraq's declaration at all and the probation report was prepared before  declaration that the government was using the younger man was using a roach declaration to try to say that the due to get a fine of two point two million dollars and to say that the defendant had been involved in daily violations for like nine morning honors michael anthony brown for the united states judge mcgee i want to start with your question about whether there was an explanation for the delay in declaring the breach in this case and i would point  court to the government's excerpts of the record one o six which is the affidavit that was filed in support of a complaint for the two thousand and fifteen case that affidavit clearly details all the government's investigation that occurred during the time of the surveillance in december two thousand and thirteen through october two thousand and fourteen and that affidavit shows that the government conducted the surveillance of the defendant subpoenaed records for the transactions at the a t m is that where the seven elevens received this subpoenaed records in january of two thousand and fourteen after reviewing the subpoenaed records contacted the banks that had provided the account numbers that the defendant used and it wasn't until  february two thousand and fourteen when bank fraud investigators from the banks confirmed that those were fraudulent transact you can see adding that you have to have to show good reason for the delay i'm not i'm just providing that for the court because there is a peer to me that there was a question about whether there was sufficient record in or whether there was evidence and so your explanation is there is ongoing investigation is ongoing investigation is the extent that you need to provide an explanation i'm not conceding that we need to provide one but there is a good one because the defendant regarding the access devices the one thousand two hundred eighty seven access device numbers was did the court make an explicit finding that mr deposit on had intended to use those devices found on the computer at his home i believe so and you know where in the record is that that would be in the sentencing transcript your hands were at you know even if she if the judge didn't explicitly make that finding she applied the enhancement in the case which implies that she made the following the finding was based on substantial evidence and so did i guess talk to me why you think there was sufficient evidence of intent to use them to access device numbers because that seems to be the greatest enhanced meant in this case that's what bumped up his son his numbers do you agree yeah i'm going to tell a lot of facts here because there were a lot before the court the first thing i want to point out is that the complaint in the two thousand and fifteen case at g e r one ten that's the government's ex urbs the record clearly states that the one thousand two hundred eighty seven access devices that were found in the deleted space of the defendant's computer back in two thousand and twelve were credit debit and gas cards those are access devices that there can't be any dispute about that the o'rourke declaration also said that they were accessed devices in the government sentencing memorandum the government offered that these were accessed devices that this secret service had verified them through the website called bank identification numbers which verifies that they are actual credit card debit card numbers are issued by a bank and even i point this out just to note that even at sentencing it appeared that the defendant had conceded that at least some of the cards were credit card numbers and that was the excerpts of record for the defendant on page thirty four now the numbers that were found in the lead space of the defendant's computer were according to the  declaration written there in two thousand and nine and two thousand and ten there was also a lot of evidence that was recovered from that computer which included the fact that the registered owner's name was vahana which is an alternative spelling of the defendant's name and we know that also because some of the sentencing letters that were addressed to the court called him behind with an age the registered owner of that installed windows in january two thousand and eight before those numbers were written on there well the last let's assume that  they're linked to him it seems like you have to show his intent to use them and assuming that he could recover the numbers from the deleted files in everything that you say and how does that demonstrate that he intended to use those access devise i'm not sure that the government has to prove that he intended to use them but i think there's sufficient evidence to show that he possessed them with the intent to commit fraud and that would be this we know from evidence in the p s r and also from evidence that was submitted in the affidavits that the defendant in two thousand and six had been kidnapped his kidnappers according to the attorneys for the kidnappers did so because they wanted to get money from him because they knew that he was involved in counterfeit access device fraud  when the kidnappers were arrested recovered in the car were seven counterfeit access devices in the defendant's name verifying the fact that at that time he was involved in access device fraud during the investigation of the two thousand and fifteen case the government uncovered evidence that from as early as two thousand and nine the defendant had been ordering from a company in marietta california skimmers and bluetooth enabled  skimmers on a regular basis that those two scammers are usually put on gas station pumps and other devices like a t m s and what that allows people to do is over the course of a day as people use their access devices it records all that information the credit card numbers the names sometimes the expiration dates and then later during the evening a person can go by using a bluetooth device download all those access device no so the evidence clearly shows that the defendant won before the numbers in this case were written into his computer was involved in skimming and he was doing that from two thousand and six until the time that he was arrested again in two thousand and fourteen if we can talk about the sentence that was imposed here because there was a lot of confusion about what needed to happen with respect to this the sentences because this was the the judge was sentencing the defendant to the two thousand and twelve case and to the two thousand and fifteen case the two thousand and fifteen case had the enhancement you still believe that those sentences from two thousand and twelve and two thousand and fifteen had to be consecutive i think that it wasn't plainly wrong for the district court to make that's different but at the time that's not it do you agree i agree that the prosecutor at the time said your honor i am not sure i think they have to read consecutive you're more of an expert in this than i am and offer that suggestion that's interesting that's interesting because you know as a judge and as a district court judge usually you look to the lawyers and most situations to help you and guide you on these areas lots true the judges do develop you know a sense of what you know from their experience of what should happen but this isn't unique it doesn't seem like a lot of people here had a lot of experience with the thirty one forty seven enhanced meant and that seems plain from the record and i understand you might be arguing that it was it's not plainly erroneous but at the time the judge was getting no help from the lawyers here so what needed to happen i think and i want you to verify now that you perhaps after looking at the record is the following it seems like those two sentences from the two thousand and twelve to that and the two thousand for fifteen needed to be grouped and they were not you do you agree with that i don't know under the grouping statute under thirty one under  as s g three c one point three the first that says that merely a portion of the two thousand and fifteen sentence attributable to thirty one forty seven must run consecutive so within that two thousand and fifteen sentence a portion of that had to run consecutive to each other because he was he committed the offense while he was on release i there's really nothing in there that says that the two thousand and fifteen and the two thousand twelve had to be consecutive well that's the government's point there's nothing in the sentencing guidelines or the statute that says that they shouldn't be run consecutively i know but that's very different because well under thirty one forty seven which is and there's consecutive language people were under the understanding and the misunderstanding that the two thousand and fifteen had to be consecutive to the two thousand and twelve well actually what the court did was the court offered alternative sentences in the case and the court clearly wanted to reach the same number under both alternatives when the government made the suggestion the court said well here's what i'm going to do i'm going to lower the sentence in the two thousand and twelve case to forty eight months it should have been fifty one months and then i'm going to run the other case consecutive to forty eight months you know under the way that the sentencing guidelines treat thirty one forty seven probably if the court had followed that by the letter of the law guidelines the three additional levels should have run consecutive in this case but to the two thousand and fifteen in the two thousand and well in the overall total total offense level and then that would have it still would have led to the same result because the court clearly wanted to reach the seventy two months in the case and the court was just trying to figure out the right way to slice of those sentences i took up a lot of time asked questions so i don't know if any of my colleagues to the question about what the court determined right in the government's brief it states at page twenty five of the government's brief that at the time of the sentencing the court followed the recommendation of the probation report and it rejected the government's loss calculation and adopted the probation officer's calculation it's also reporters transferred to page eight but it's right in the government's brief so that they've rejected the government was relying upon a rick's declaration by the way which consul misstated the declaration in no way connected any of the numbers in the computer to any of the losses in this case and you can look at o'rourke's declaration he does a generic declaration that said th is a possibility you can presumably a thief if he wanted to could use numbers to do this that or whatever in the future but he never connected any of the numbers in this case to his declaration and the court did not rely upon iraq's declaration and it's right in the report is transcript she all she did is look at the probation report the probation took the twelve hundred some numbers multiplied by five hundred and that's all the judge did now the guidelines made clear in the changes in november of two thousand and fifteen that you had to show it's the subjective intent of the perpetrator as to whether or not he intended to use those numbers the only evidence in the record about those numbers was that they were put in the computer sometime in two thousand and nine two thousand and ten and they were deleted some a year and a half before the defender was arrested in two thousand and twelve that was the sum total of the evidence in this case that was and those numbers were never connected flew in the bank to any card holder or anything so all we have in the record is the numbers were in the computer by someone they were deleted by somebody the definit was arrested two years later and that's it and they just took this road approach we're going to multiply this twelve hundred numbers by five hundred dollars and that's the end of the story thank