Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-89-03263/USCOURTS-ca10-89-03263-0/pdf.json

Parties Involved:
Michael Angelo Irvin
Appellant
United States of America
Appellee

Document Text:

PUBLISH 

UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

UNITED STATES OF AMERICA, 

Plaintiff-Appellee, 

FILE·D 

Uaited Sts~ Cmm: of A~peals 

Tenth Circuit 

ROBERT L. 1-IOECKER 

Clerk 

v. 

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No. 89-3263 

MICHAEL ANGELO IRVIN, 

Defendant-Appellant. 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF KANSAS 

(D.C. No. 89-20033-01) 

Submitted on the briefs: 

Charles D. Anderson, Federal Public Defender, and Michael L. 

Harris, Assistant Federal Public Defender, District of Kansas, 

Kansas City, Kansas, for Defendant-Appellant. 

Benjamin L. Burgess, Jr., United States Attorney, and Julie A. 

Robinson, Assistant u.s; Attorney for the District of Kansas, 

Kansas City, Kansas, for Plaintiff-Appellee. 

Before McKAY and BALDOCK, Circuit Judges, and COOK,* Chief 

District Judge. 

McKAY, Circuit Judge. 

*Honorable H. Dale Cook, Chief Judge, United States District Court 

for the Eastern, Northern and Western Districts of Oklahoma, 

sitting by designation. 

Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 1 
This case involves a challenge to the district court's 

application of section 4B1.3 of toe United States Sentencing 

Guidelines. 

I. Facts 

From approximately May 1, 1988 to October 14, 1988, defendant 

used fraudulently obtained credit cards to acquire $4,894.72 worth 

of goods. On June 19, 1989, defendant entered a plea of guilty to 

mail fraud in violation of 18 U.S.C. § 1341, pursuant to a plea 

bargain with the government. In arriving at a sentence for 

defendant, the district court applied section 4B1.3 of the Sentencing Guidelines--the criminal livelihood enhancement--to 

increase defendant's offense level from eight to eleven. The sentencing range for defendant at an offense level of eight would 

have been two to eight months. See United States Sentencing 

Commission, Guidelines Manual, §SA (Nov. 1989). Instead, defendant was sentenced to a term of nine months. Nine months is within 

the sentencing range of eight to fourteen months for an offense 

level of eleven. See id. Defendant now appeals the district 

court's application of section 4B1.3 to enhance his sentence. 

II. Standard of Review 

Pure questions of interpretation of the sentencing guidelines, which are closely analogous to questions of statutory 

interpretation, are questions of law. United States v. Smith, No. 

88-2563 (10th Cir. Mar. 29, 1990) (WESTLAW; Federal Library). Cf. 

North American Coal Corp. v. Director, o.w.c.P., 854 F.2d 386, 388 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 2 
(10th Cir. 1988); Sage v. Automation, Inc. Pension Plan and Trust, 

845 F.2d 885, 890 (10th Cir. 1988). We review questions of law de 

novo. De novo review requires us to make an independent determination of the issues, similar to that which the trial court makes 

in its initial ruling. See United States v. Ortiz, 804 F.2d 1161, 

1164 (10th Cir. 1986). 

III. Sentencing Guidelines Section 4B1.3 

The language of section 4B1.3 in effect when defendant was 

sentenced1 was:. 

If the defendant committed an offense as a part of a 

pattern of criminal conduct from which he derived a substantial portion of his income, his offense level shall 

not be less than 13, unless §3El.l (Acceptance of · Responsibility) applies, in which event his offense 

level shall be not less than 11. 

u.s.s.G. §4B1.3 (Oct. 1988). Defendant claims that the district 

court erred in applying this section to defendant for two reasons. 

First, defendant claims that the language in section 4B1.3, "pattern of criminal conduct,'' requires criminal activity for a longer 

period of time than that which took place during his offense. 

Second, defendant claims that the language in section 4B1.3, "substantial portion of his income," requires a defendant to have made 

a substantial amount of income, regardless of source. Defendant 

claims that a total of $4,894.72 is not a substantial portion. 

1 Section 4B1.3 was substantially amended in November 1989. 

See u.s.s.G. § 4B1.3 (Nov. 1989). 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 3 
A. "A Pattern of Criminal Conduct" 

The application notes accompanying section 4Bl.3 define "pattern of criminal conduct" as: "planned criminal acts occurring 

over a substantial period of time. Such acts may involve a single 

course of conduct or independent offenses." U.S.S.G. §4Bl.3, 

comment. (n.l) (Oct. 1988). We interpret the phrase "a substantial period of time" in this application note to require more than 

a short, quick, one-time offense. In this case, defendant engaged 

in fraudulent use of credit cards from at least May 17, 1988 to 

October 14, 1988--a period of almost five months. In addition, 

defendant rented the post office box with which he fraudulently 

obtained the credit cards on March 23, 1988. If the time period 

is counted from March 23, 1988, then defendant engaged in criminal 

acts for almost seven months. 

The government inferentially claims that United States v. 

Luster, 889 F.2d 1523, 1530-31 (6th Cir. 1989), stands for the 

proposition that criminal conduct for five to seven months fits 

within the language of section 4Bl.3. However, the Luster court 

actually relied on several offenses that occurred years before the 

charged offense to find a pattern of criminal conduct. See 

Luster, 889 F.2d at 1531. A more analogous case is United States 

v. Hearrin, 892 F.2d 756 (8th Cir. 1990). The Hearrin court held 

that a well-organized effort to commit mail fraud over an eightmonth period was criminal conduct occurring over a substantial 

period of time. See Hearrin, 892 F.2d at 760. 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 4 
We hold that defendant's well-organized criminal venture continuing for a period of approximately five to seven months also 

fits within the definition of a pattern of criminal conduct. The 

application note to section 4Bl.3 explains that a pattern of criminal conduct may involve only a single course of conduct. We 

believe that criminal conduct extending for a period of five to 

seven months is criminal conduct occurring over a substantial 

period of time. Thus, we uphold the district court's application 

of section 4B1.3 to defendant. 

B. "A Substantial Portion of His Income" 

The language in section 4Bl.3, "substantial portion of his 

income," has been interpreted by several federal courts. 

Unfortunately, their interpretations have not been uniform. Three 

courts have held that the plain language of section 4Bl.3 does not 

require an individual convicted of criminal conduct to earn a substantial amount of money from his criminal acts. Instead, these 

courts hold that the language simply requires a convicted individual to earn a substantial portion of his income, however meager, from criminal acts. See United States v. Munster-Ramirez, 

888 F.2d 1267, 1270 (9th Cir. 1989); United States v. Luster, 889 

F.2d 1523, 1527-30 (6th Cir. 1989); United States v. Kerr, 686 F. 

Supp. 1174, 1178 (W.D. Pa. 1988). 

Another three federal courts have reached exactly the opposite conclusion regarding the language of section 4Bl.3. These 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 5 
courts hold that the language of section 4Bl.3 requires an individual convicted of criminal conduct to not only earn a substantial portion of his overall income from the criminal acts, but 

that he must also make a substantial amount of income defined in 

absolute terms. See United States v. Cianscewski, 894 F.2d 74, 

77-78 (3d Cir. 1990); United States v. Nolder, 887 F.2d 140, 142 

(8th Cir. 1989); United States v. Rivera, 694 F. Supp. 1105, 1108 

(S.D.N.Y. 1988). 

Although we find the language of section 4Bl.3 unclear, we 

are willing to concede that one logical interpretation of the word 

"portion," in context, would merely require a substantial portion 

of a convicted individual's total, regardless of amount, to arise 

from criminal activities. Under this interpretation, an individual who makes a large percentage of a very small income from 

criminal conduct would still be subject to enhancement under section 4B1.3. However, we are not willing to ascribe such an intention to the Sentencing Commission for essentially four reasons. 

First, section 4B1.3 was amended in November 1989 to include 

a minimum criminal income requirement. 

If the defendant committed an offense as part of a pattern of criminal conduct engaged in as a livelihood, his 

offense level shall be not less than 13, unless §3El.l 

(Acceptance of Responsibility) applies, in which event 

his offense level shall be not less than 11. 

u.s.s.G. § 4Bl.3 (Nov. 1989). The current application notes 

define the new term "engaged in as a livelihood'' to mean that 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 6 
''[t)he defendant derived income from the pattern of criminal conduct that in any twelve-month period exceeded 2,000 times the then 

existing hourly minimum wage under federal law (currently 2000 x 

the hourly minimum wage under Federal law is $6,700) ..•• " 

u.s.s.G. § 4B1.3, comment. (n.2) (Nov. 1989). To the extent that 

this amendment can be read to clarify, rather than alter, ''we may 

give it substantial weight in determining the meaning of the 

existing guideline." United States v. Ofchinick, 877 F.2d 251, 

257 n.9 (3d Cir. 1989). We believe that the amendment is merely a 

clarification. 

Second, 28 U.S.C. § 994(d) requires the Commission to assure 

that the guidelines are "entirely neutral as to the race, sex, 

national origin, creed, and socioeconomic status of offenders." 

28 u.s.c. § 994(d) (Supp. IV 1986). If there were no minimum 

income threshold in section 4B1.3, then wealthy individuals with 

large amounts of legitimate income would not be subject to the 

enhancement provision for engaging in the same criminal conduct as 

poor individuals who have no other source of income and are thus 

subject to enhancement. Clearly such a rule would violate the 

Commission's mandate from section 994(d) to see that the Guidelines are neutral as to socioeconomic status. We recognize that a 

minimum income threshold does not solve the problem entirely. 

However, it alleviates at least part of the difficulty. Truly 

impecunious individuals will not be punished more harshly than 

those only slightly more wealthy. We cannot infer that the 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 7 
Commission intended to viola~e section 994(d) by creating section 

4Bl.3. 

Third, the legislative history of the criminal livelihood 

enhancement provision indicates that its language was adopted from 

the Dangerous Special Offender statute located at 18 u.s.c. § 

3575(e)(2), and 21 u.s.c. § 849(e}(2). See S. Rep. No. 98-225, 

98th Cong., 1st Sess. 175-76, reprinted in 1984 U.S. Code Cong. & 

Admin. News 3182, 3359. 2 These statutes define "substantial 

source of income" as an amount which exceeds the yearly minimum 

wage. See 18 U.S.C. § 3575(e)(2) (1982) (repealed 1984); 21 

U.S.C. § 849(e)(2) (1982) (repealed 1984). While the Sentencing 

Commission's adoption of the words contained in the Special 

Offender statute does not necessarily mean that the precise definition of those words was also adopted, we believe that absent evidence to the contrary a strong inference can be maintained that 

the Commission adopted the existing definition with the words. We 

believe that the Commission's use of the exact language of 

Congress indicates an intent to adopt Congress' existing definition. 

2 In fact, Congress used the same language when it passed the 

statute authorizing promulgation of the Guidelines. "The Commission shall assure that the guidelines specify a sentence to a substantial term of imprisonment for categories of defendants in 

which the defendant ••• (2) committed the offense as part of a 

pattern of criminal conduct from which he derived a substantial 

portion of his income." 28 u.s.c. § 994(i) (Supp. IV 1986). 

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Finally, the older version of section 4Bl.3 was followed by 

an application note which contained an implied absolute threshold 

requirement. "This guideline is not intended to apply to minor 

offenses." u.s.s.G. § 4Bl.3, comment. (n.l) (Oct. 1988). This 

note indicates that the Commission did not intend the criminal 

livelihood enhancement provision to apply to criminal offenses 

involving small amounts. 

Based on these four independent reasons, we hold that the 

October 1988 version of section 4Bl.3 of the Sentencing Guidelines 

applies only to cases in which the criminal conduct meets a 

threshold level of income. 3 The current version of section 4Bl.3 

and the special offender statute require at least $6,700 in criminal income. We adopt $6,700 as a floor in these cases. Since 

defendant in this case had a criminal income of only $4,894.72, we 

hold that the district court erroneously applied the section 4Bl.3 

enhancement to his sentence. We reverse defendant's sentence and 

remand for resentencing consistent with this opinion. 

IV. Conclusion 

We AFFIRM the district court's interpretation of sentencing 

guideline 4Bl.3 concluding that five to seven months of criminal 

activity fulfills the requirement of a pattern of criminal conduct. We REVERSE the district court's interpretation of the "substantial portion of his income" language in section 4Bl.3. We 

3 We note that our decision on this issue will have little 

precedential importance since the Commission's 1989 amendments 

clarify the former ambiguity. 

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Appellate Case: 89-3263 Document: 01019880167 Date Filed: 06/26/1990 Page: 9 
hold that the district court erred in applying section 4Bl.3 to a 

defendant who had a total income of only $4,894.72. ,Therefore, we 

REVERSE defendant's sentence and REMAND to the district court for 

resentencing consistent with this opinion. 

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