* Local Rule 47.5 provides: "The publication of opinions

that have no precedential value and merely decide particular cases

on the basis of well-settled principles of law imposes needless

expense on the public and burdens on the legal profession."

Pursuant to that Rule, the Court has determined that this opinion

should not be published.

UNITED STATES COURT OF APPEALS

For the Fifth Circuit

No. 95-50048

Summary Calendar

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

VERSUS

SHERRILL P. LANDES, and

LARS NELSON BORNKESSEL,

Defendants-Appellants.

Appeal from the United States District Court

For the Western District of Texas

(SA-94-CR-77-1)

October 31, 1995

Before DAVIS, BARKSDALE and DeMOSS, Circuit Judges.

PER CURIAM:*

BACKGROUND

The Federal Bureau of Investigation (FBI) in San Antonio,

Texas became aware of an increasing number of complaints regarding

a 1993 local telemarketing enterprise. The FBI determined that the
2

enterprise was divided into two companies, Hugs and Not Drugs, also

known by the acronym "HAND," and Nationwide Marketing. The

evidence at trial indicated that both companies were owned and

controlled by Sherrill Landes. 

The trial evidence indicated that defendant Lars Bornkessel

began working for HAND in September 1993 as a sales representative

and later moved to Nationwide in the same capacity. From about

January until March 1994, Bornkessel worked as assistant manager

for Nationwide. FBI Special Agent Christopher Graham testified

that Landes' companies had revenues of $2,737,744; that

Bornkessel's own sales accounted for $58,774.89; and that

Nationwide's sales from January to March 1994 totalled $381,937.96.

Graham also testified that a document reflecting Nationwide's sales

for January and February 1994 indicated sales of around $300,000

but did not indicate sales by Bornkessel. 

FBI Special Agent Michael Lemoine testified that Landes opened

bank accounts for HAND and Nationwide on December 20, 1993.

Between December 1993 and March 1994, Landes deposited $166,000

into the HAND account and $420,000 into the Nationwide account.

Lemoine also testified that Bornkessel sold $12,583 at HAND and

$43,413 at Nationwide and received commissions of more than

$13,000. 

The Probation Officer determined that Bornkessel had generated

losses of $35,185.63 to victims as a salesman at Nationwide and

that Nationwide had generated $831,044 in losses to victims while

Bornkessel worked as assistant manager. The probation officer
3

based Bornkessel's offense level on losses of $866,299.63.

Bornkessel objected to the amount on which his offense level was

based, contending that his offense level should be based on losses

of $58,774.89. The Government also objected to the amount of

losses upon which Bornkessel's offense level was based. The

Government contended that Bornkessel should be held responsible for

losses of $50,685.25 from his sales between September and December

1993 and $381,937.96 from total sales while he was assistant

manager at Nationwide. The probation officer stood by the losses

indicated in the PSR, indicating that those were the most recent

figures provided by the FBI. The district court adopted the PSR;

sentenced Bornkessel to three concurrent 57-month terms of

imprisonment; and ordered Bornkessel to pay restitution of

$866,229.63. 

OPINION

On July 5, 1995, Gilbert Carter, who avers that he is Landes'

next of kin, filed a motion to substitute himself for Landes.

Carter avers that Landes died on June 25, 1995. Carter's motion

was granted. The Government agrees that Landes is dead and

contends that Landes' appeal should be dismissed. 

"[T]he death of a criminal defendant pending an appeal of his

or her case abates, ab initio, the entire criminal proceeding."

United States v. Asset, 990 F.2d 208, 210 (5th Cir. 1993). The

abatement rule does not apply to an order of restitution that is

intended to compensate victims rather than punish a defendant. In

such a case, the restitution order is appealable. Id. at 214.
4

Carter indicated in his motion that he wished to preserve the

rights of Landes' estate regarding restitution. Carter, however,

did not indicate any issues he wished to raise regarding

restitution and Landes did not raise any contentions regarding

restitution before he died. Because restitution is not at issue in

Landes' case, this Court will dismiss Landes' appeal and remand his

case to the district court with instructions to dismiss the

indictment against him. See United States v. Pauline, 625 F.2d

684, 685 (5th Cir. 1980). This does not affect the restitution

order.

Bornkessel contends that the district court erred by declining

to give the jury his proposed instruction regarding his theory that

he had acted in good faith during his employment with Landes.

Bornkessel proposed an instruction indicating that the jury could

not find he harbored an intent to defraud if he acted in good

faith. The district court rejected the proposed instruction. 

"A trial court's refusal to include a requested instruction in

the jury charge is reviewed under an abuse of discretion standard,

and the court is afforded substantial latitude in formulating its

instructions." United States v. Storm, 36 F.3d 1289, 1294 (5th

Cir. 1994), cert. denied, 115 S. Ct. 1798 (1995). Failure to give

a good-faith instruction is not reversible error when the district

court gives a detailed instruction on specific intent and the

defendant is able to argue good faith to the jury. Id.; United

States v. Rochester, 898 F.2d 971, 978 (5th Cir. 1990).
5

The district court instructed the jury that the term

"willfully" means that "the act was committed voluntarily and

purposely, with the specific intent to do something the law

forbids; that is to say, with bad purpose either to disobey or

disregard the law." Additionally, Bornkessel argued good faith to

the jury. The district court did not abuse its discretion by

rejecting Bornkessel's proposed instruction.

Bornkessel next contends that the district court erred by

basing his offense level on losses of $866,229.63, arguing that his

offense level should have been based on losses of $55,996 or

$58,774.89. Bornkessel also contends that the district court's

error resulted in an erroneous restitution order. The Government

concedes that the amount of loss on which Bornkessel's offense

level is based is not supported by the record. The Government

argues that the record supports basing the offense level on losses

of between $360,000 and $500,000. 

The guideline provision relevant to Bornkessel's fraud

convictions provides that the offense level should be determined in

part on the amount of loss caused by the offense. U.S.S.G.

§ 2F1.1(b)(1). The counts upon which Bornkessel was convicted are

subject to grouping under the guidelines. § 3D1.2(d). The

district court therefore could have attributed to Bornkessel as

relevant conduct "all acts and omissions [aided, abetted, procured,

or caused by him or reasonably foreseeable acts of others in

furtherance of joint criminal activity] that were part of the same
opin\95-50048.opn

6

course of conduct or common scheme or plan as the offense of

conviction". § 1B1.3(a)(2).

"Presentence reports generally bear indicia of reliability

sufficient to permit reliance thereon at sentencing[.]" United

States v. Gracia, 983 F.2d 625, 629 (5th Cir. 1993) (footnote

omitted). Disputed facts in a PSR must have an adequate

evidentiary basis to be adopted by the court. United States v.

Valencia, 44 F.3d 269, 274 (5th Cir. 1995). "Bald, conclusionary

statements do not acquire the patina of reliability by mere

inclusion in the PSR." United States v. Elwood, 999 F.2d 814, 817-

18 (5th Cir. 1993).

The probation officer stated that the FBI's investigation

indicated sales by Bornkessel from September to December 1993 of

$35,185.63 and losses generated by Nationwide from January to March

1994 of $831,044. Beyond identifying the source of his

information, the probation officer provided no specifics indicating

the evidentiary basis for the information. The testimony at trial

indicated that Bornkessel's sales at HAND and Nationwide totalled

$55,996; that losses at Nationwide during Bornkessel's tenure as

assistant manager at Nationwide totalled $381,937.96; and that

Landes deposited a total of $586,000 into HAND's and Nationwide's

bank accounts between December 1993 and March 1994. 

The trial testimony does not support the probation officer's

determination regarding the amount of loss attributable to

Bornkessel. Our review of the record and evidence has found no

evidence supporting the PSR. Because the PSR lacks sufficient
opin\95-50048.opn

7

indicia of reliability upon which to base Bornkessel's sentence,

this Court will vacate Bornkessel's sentence and remand his case

for resentencing.

Appeal dismissed as to Landes and case remanded to district

court for dismissal of indictment. Conviction of Bornkessel is

affirmed. Sentence of Bornkessel is vacated and case is remanded

for resentencing as to Bornkessel.