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Parties Involved:
Marvin J. Morrison
Appellant
United States of America
Appellee

Document Text:

PUBLISH 

FILED 

UNITED STATES COURT OF APPEALS United States Court o! Appeals Tenth circuit. 

TENTH CIRCUIT JUL 0 21991 

ROBERT L. HOECKER 

Clerk 

UNITED STATES OF AMERICA, ) 

v. 

MARVIN J. 

) 

Plaintiff-Appellee, ) 

) 

) No. 90-1364 

) 

MORRISON, ) 

) 

Defendant-Appellant. ) 

Appeal from the United States District Court 

for the District of Colorado 

(D.C. No. 88-CR-285) 

Norman R. Mueller of Haddon, Morgan & Foreman, Denver, Colorado, 

for defendant-appellant. 

James P. Moran, Assistant United States Attorney (Michael J. 

Norton, United States Attorney, with him on the brief), Denver, 

Colorado, for plaintiff-appellee. 

Before MCKAY, BARRETT, and LOGAN, Circuit Judges. 

LOGAN, Circuit Judge. 

Appellate Case: 90-1364 Document: 01019293778 Date Filed: 07/02/1991 Page: 1 
Defendant Marvin J. Morrison pleaded guilty to two counts of 

mail fraud in violation of 18 u.s.c. § 1341, and two counts of 

willful failure to file an income tax return in violation of 26 

u.s.c. § 7203. The district court sentenced defendant to twelve 

years in prison and ordered him to pay restitution under 18 U.S.C. 

§ 3663, 1 the Victim and Witness Protection Act. Defendant now appeals, arguing that because he continued to engage in criminal 

activities after the effective date of the United States Sentencing Guidelines, he should have been sentenced under the 

guidelines. He further contends that the district court failed to 

consider his ability to pay in imposing the restitution order. We 

affirm. 

I 

Defendant committed his crimes in connection with a 

fraudulent commodity futures trading scheme. Over a five year 

period, he obtained money from investors to trade commodity 

futures on their behalf. Instead of executing such trades, 

defendant diverted much of the money to his own use. He used the 

mail to perpetrate this scheme. Counts one and two charged that 

defendant was involved in a mail fraud scheme between January 1982 

and October 1987. Defendant also failed to file income tax 

returns for calendar years 1985 and 1986. Counts three and four 

charged him with willfully failing to pay his income taxes for 

these years. 

1 The court's restitution order was entered under 18 u.s.c. 

§ 3579 (1982). Section 3579 has been renumbered 18 u.s.c. § 3663. 

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Defendant pleaded guilty to all four counts. Because the 

crimes, as charged, all occurred before the November 1, 1987, effective date of the sentencing guidelines, the district court did 

not apply the guidelines in sentencing defendant. The district 

court sentenced defendant to a total of twelve years imprisonment: 

two consecutive five year terms on the mail fraud offenses, and 

two consecutive one year terms on the tax offenses. 

After he was sentenced, defendant filed a Fed. R. Crim. P. 

35(a) motion with the district court, arguing that the information 

incorrectly characterized his crimes as occurring solely before 

the effective date of the guidelines, and that application of the 

guidelines would result in the imposition of a much shorter prison 

sentence. 2 The district court rejected these arguments and 

refused to resentence defendant under the guidelines. 

As to the income tax convictions, defendant argues on appeal 

that "until February 1988, when his commodity futures trading 

company was closed, Defendant expected to pay back his investors 

and did not consider any investor funds to be taxable income." 

Opening Brief of Defendant-Appellant at 4. Thus, according to 

defendant, he did not willfully fail to report his investor's 

funds as taxable income until 1988. This argument is frivolous. 

These offenses occurred when defendant willfully failed to pay 

taxes "at the time or times required by law . II 26 u.s.c. 

§ 7203. Thus, these crimes occurred on April 15, 1986, and 

2 "Defendant calculated that the highest possible offense level 

applicable to him [under the guidelines] was 16. With defendant 

falling within criminal history category I, the applicable 

guideline range was 21 to 27 months." Opening Brief of DefendantAppellant at 5. 

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Appellate Case: 90-1364 Document: 01019293778 Date Filed: 07/02/1991 Page: 3 
April 15, 1987, the filing deadlines for defendant's 1985 and 1986 

calendar year tax returns. 

Defendant's contention that he should have been sentenced 

under the guidelines on the mail fraud convictions raises a closer 

question of law. The guidelines "apply only to offenses committed 

after" November 1, 1987. Sentencing Act of 1987, Pub. L. No. 100-

182, § 2(a), 101 Stat. 1266 (1987). Although this language is 

somewhat ambiguous, the courts agree that the guidelines apply to 

"straddle" crimes: continuing offenses "in which acts comprising 

the crime occur both before and after the effective date of the 

Guidelines." United States v. Bakker, 925 F.2d 728, 739 (4th Cir. 

1991). See also United States v. Williams, 897 F.2d 1034, 1040 

(lOth Cir. 1990) (Guidelines applied to conspiracy beginning 

before but continuing after November 1, 1987), cert. denied, 59 

U.S.L.W. 3782 (U.S. May 20, 1991) (No. 90-7752). 

In the instant case, the government concedes that the mail 

3 fraud continued after November 1, 1987. Nevertheless, defendant 

pleaded guilty to a mail fraud scheme ending before that date. In 

dicta, the Fourth Circuit has suggested that the guidelines must 

be applied in imposing sentence in such a case. See Bakker, 925 

F.2d at 739 ("[U]sing the ending date of an indictment as the 

determinant of Guidelines applicability could allow the government 

[improperly] to manipulate whether a defendant was sentenced under 

3 On appeal, the government does not contest the district court's 

determination that mail fraud is a continuing offense capable of 

straddling the effective date of the guidelines. See Appellant's 

App. at 98-99. There is authority to the contrary. See Bakker, 

925 F.2d at 739. But see United States v. Angelica, 859 F.2d 

1390, 1393 (9th Cir. 1988). 

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Appellate Case: 90-1364 Document: 01019293778 Date Filed: 07/02/1991 Page: 4 
the Guidelines simply by choice of ending date."). But cf. United 

States v. Tharp, 892 F.2d 691, 693 (8th Cir. 1989) (suggesting 

that government might be able to render guidelines inapplicable by 

charging that conspiracy ended before November 1, 1987). We need 

not determine whether we would agree with the Bakker court dictum 

in some other case; we reject its application to the case at hand. 

Defendant does not argue that the government's decision to 

charge him with a mail fraud scheme ending before November 1, 

1987, violated any constitutional constraints. See Wayte v. 

United States, 470 u.s. 598, 607-08 (1985) (prosecutor has broad 

discretion in deciding what charge to file). Rather, he admits in 

his brief that the information, which indicates that defendant's 

mail fraud scheme terminated before the guidelines' effective 

date, resulted from a pre-indictment plea 

Brief of Defendant-Appellant at 13. 4 

agreement. Opening 

By pleading guilty, 

defendant admitted that he committed the offense charged, namely, 

a mail fraud scheme ending in October 1987. He cannot now challenge the factual basis of the charge to which he pleaded guilty. 

United States v. Broce, 488 U.S. 563, 570 (1989). "If [defendant] 

disagreed with the dates of the [scheme], he should have attempted 

to negotiate a change in the plea agreement." United States v. 

Edgecomb, 910 F.2d 1309, 1312 (6th Cir. 1990). Accordingly, the 

4 Defendant explains that he entered his plea before courts 

determined that the guidelines applied to straddle crimes. If 

defendant means to attack his plea by this assertion, his efforts 

are fruitless. "[A] voluntary plea of guilty intelligently made 

in the light of the then applicable law does not become vulnerable 

because later judicial decisions indicate that the plea rested on 

a faulty premise." Brady v. United States, 397 U.S. 742, 757 

(1970). 

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district court committed no error when it sentenced defendant 

under pre-guideline standards. 

II 

Defendant also appeals the district court's order requiring 

him to pay $613,765 in restitution under 18 u.s.c. § 3663, the 

Victim and Witness Protection Act (VWPA). 5 He argues that the 

district court failed to consider his ability to pay as required 

by 18 u.s.c. § 3664(a). 

The district court judge who sentenced defendant, in 

considering defendant's Rule 35(a) motion raising this issue, 

responded: "Although the court in the present case did not make 

any specific findings regarding defendant's ability to pay 

restitution, the transcript of the Sentencing Hearing makes it 

clear that this factor was considered by the court." Appellant's 

App. at 106. The judge then cited several parts of the transcript 

in which defendant's financial situation and employment prospects 

were discussed. Id. at 106-07. This is sufficient to comply with 

§ 3664(a). See United States v. Rogat, 924 F.2d 983, 986 (lOth 

Cir.) (The VWPA "requires only that a sentencing judge consider 

the defendant's financial condition; the judge need not 

5 The court initially ordered defendant to pay $2,717,496.81 in 

restitution to eighty-eight victims of the mail fraud scheme. See 

Appellant's App. at 23-25 (district court's restitution order of 

Dec. 8, 1988). In response to defendant's Rule 35(a) motion, 

however, the court determined that restitution under the VWPA 

could only be awarded for losses suffered by victims named in the 

indictment resulting in conviction. See Appellant's App. at 102-

04 (district court's order of Nov. 30, 1990). Accordingly, the 

court amended its judgment, ordering defendant to pay a total of 

$613,765 in restitution to the six victims named in the information on which defendant was convicted. Id. at 104, 107. 

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specifically recite his findings regarding that condition."), 

cert. denied, 111 s. Ct. 1637 (1991). 

If we construe defendant's challenge as an argument that the 

district court abused its discretion in making a finding of his 

ability to pay, we still must affirm. See United States v. 

Teehee, 893 F.2d 271, 273-74 (lOth Cir. 1990) (district court's 

factual findings underlying restitution order reviewed for clear 

error); Rogat, 924 F.2d at 985 (amount of restitution order 

reviewed for abuse of discretion). 

A defendant bears the burden of establishing his inability to 

make restitution. See 18 u.s.c. § 3664(d). The instant defendant 

has not met this burden. Although he currently has a negative 

monthly cash flow, and his assets have been seized in connection 

with a related civil action, such characteristics do not necessarily establish an inability to pay. See Rogat, 924 F.2d at 984, 

986 (affirming district court restitution order requiring payment 

of $2,449,142.48 though defendant had a negative net worth of 

$185,000 and a negative monthly cash flow). The presentence 

report shows that defendant has a college degree in petroleum 

engineering and has successfully operated numerous supermarkets 

and convenience stores. His mail fraud scheme shows he has 

imagination and skills of persuasion, that might be applied to 

endeavors that are legal. Moreover, he has expressed a sincere 

desire to make full restitution. Finally, the restitution order 

is time-limited, giving defendant five years after his release 

from prison to make restitution; the order will terminate then, if 

by his good faith efforts defendant is unable to complete payment. 

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See id. at 986. The order is within the realm of possibility. We 

hold the district court did not abuse its discretion in making the 

restitution order. 

AFFIRMED. 

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