In the

United States Court of Appeals

for the Seventh Circuit

____________________

No. 23-1410

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

KEVIN SHIBILSKI,

Defendant-Appellant.

____________________

Appeal from the United States District Court 

for the Western District of Wisconsin.

No. 20-CR-122-JDP — James D. Peterson, Chief Judge.

____________________

ARGUED JANUARY 10, 2024 — DECIDED JUNE 10, 2024

____________________

Before SYKES, Chief Judge, and HAMILTON and LEE, Circuit 

Judges.

SYKES, Chief Judge. A grand jury charged Kevin Shibilski

with environmental and wire-fraud crimes arising from his 

operation of three Wisconsin-based companies engaged in the 

business of recycling electronic equipment. The indictment 

also included one count of conspiracy to defraud the United 

States relating to his willful nonpayment of payroll taxes for 

his employees.
2 No. 23-1410

Shibilski pleaded guilty to a single felony count of willful

failure to pay employment taxes; in exchange, the government dropped the other charges. Though the case had been 

dramatically simplified, sentencing proved to be protracted.

Shibilski objected to the presentence report’s recommendations regarding relevant conduct under the Sentencing 

Guidelines—notably, the recommendation to hold him responsible for the total amount of unpaid employment taxes

for all three companies. To address these objections, the district judge held a seven-hour sentencing hearing, most of 

which was consumed by the presentation of documents and

testimony, including testimony from Shibilski himself. During the evidentiary phase of the hearing, Shibilski’s attorney

pursued irrelevant and redundant lines of inquiry, prompting 

the judge to step in to keep him on topic and on track to finish 

on time. 

In the end the judge found Shibilskiresponsible for the full 

amount of unpaid taxes. The judge also declined to award

credit for acceptance of responsibility under U.S.S.G.

§ 3E1.1(a), finding that Shibilski had falsely denied responsibility for relevant conduct. After weighing the statutory sentencing factors, the judge imposed a sentence of 33 months in 

prison, the bottom of the advisory Guidelines range.

Shibilski argues that the judge violated Rule 32(i)(4)(A)(i)

of the Federal Rules of Criminal Procedure by unduly curtailing his attorney’s presentation of evidence. He also claims

that the judge improperly denied credit for acceptance of responsibility under § 3E1.1(a). Finally, he contends that the 

judge committed procedural error by failing to meaningfully 

address the statutory sentencing factors. We reject these arguments and affirm.
No. 23-1410 3

I. Background

This case has its roots in concurrent state and federal investigations into environmental and tax crimes occurring at

5R Processors, Ltd., a Wisconsin-based company engaged in 

the business of recycling electronic equipment. The environmental and tax inquiries led to a broader investigation of the 

company’s operations. What follows is a condensed version

of the facts and procedural history of the case; a more detailed 

account is not necessary to resolve this appeal.

Founded in 1988 by Tom Drake, 5R grew over time to include recycling and storage facilities in Wisconsin and Tennessee. But the company was plagued by cash-flow problems, 

so in 2011 Drake hired Keven Shibilski as a consultant to help 

the company find new sources of operating capital. Shibilski

had spent most of his professional life in the public sector as

a county register of deeds, state senator, and (briefly) state 

tourism secretary; he had limited relevant business experience.

After two years of fruitless searching, Shibilski proposed 

to purchase 5R himself in a three-year phased transaction in 

which he would incrementally acquire Drake’s ownership interest while he continued to look for a secure source of operational financing. Drake agreed. As the deal was structured,

Shibilski paid nothing to acquire Drake’s shares but immediately began running the company. In March 2013 he assumed 

control of 5R as its CEO and CFO, with a starting salary of 

about $107,000, which increased to $156,500 by 2015 and 

$170,500 by 2016. Drake temporarily stayed on as chairman 

once Shibilski took over, but he had limited involvement because of serious health problems. Shibilski gradually acquired

a majority of Drake’s shares in a phased buyout in which 
4 No. 23-1410

Drake received annual “salary” and lump-sum payments

from 5R itself.

The company’s financial prospects did not improve after 

Shibilski took the reins in March 2013. His search for operating capital failed, and cashflow problems worsened. In the 

meantime, Shibilski began paying himself an extra $3,000 per 

month for office space he leased to the company. He also put 

his wife on the payroll as a ghost employee; she never came 

to the office.

In 2014 5R stopped paying required employment taxes to 

the Internal Revenue Service and the Wisconsin Department 

of Revenue. In essence, the company was using employees’ 

withheld income and payroll taxes to help stem the deterioration of its financial condition. The nonpayment of taxes eventually drew the attention of state and federal taxing 

authorities. State tax agents commenced an enforcement action, and an IRS agent conducted a site visit.

In response to the company’s large looming liability for 

unpaid employment taxes, Shibilski created two spinoff companies to carry on 5R’s recycling and transportation operations: Pure Extractions Inc., which assumed 5R’s recycling 

business, and Wisconsin Logistics Solutions LLC, which took 

over 5R’s transportation operations. But nothing changed as 

a functional or operational matter. 5R’s assets, employees, 

and operations were moved to the two new companies, leaving 5R with the liabilities.

At some point along the way, state and federal environmental agencies began investigating the companies for improper storage, transportation, and disposal of hazardous 

waste from the recycling process. The environmental 
No. 23-1410 5

inquiries spawned an expanded financial investigation, and 

law enforcement stepped in. In September 2020 a grand jury 

returned a 10-count indictment charging Shibilski with environmental and wire-fraud crimes and conspiracy to defraud 

the United States. The conspiracy charge alleged that from 

July 2014 through June 2016, Shibilski willfully failed to remit 

payroll taxes to the IRS for the employees of 5R, Pure Extractions, and Wisconsin Logistics.

In May 2021 a magistrate judge entered a scheduling order 

setting the case for trial on May 23, 2022, with a final pretrial 

conference to be held on April 14, 2022. One week before the 

pretrial conference, the parties reached a plea agreement in 

which Shibilski agreed to plead guilty to a single felony 

count—willful failure to pay employment taxes in violation 

of 26 U.S.C. § 7202—as charged in an information filed that 

same day. In exchange, the government agreed to dismiss all

charges in the indictment. The government also agreed to recommend that Shibilski receive credit for acceptance of responsibility under § 3E1.1(a) of the Guidelines—conditioned, 

of course, on Shibilski’s actual acceptance of responsibility. 

The government reserved the right to withdraw this recommendation if Shibilski engaged in conduct inconsistent with 

acceptance of responsibility.

As a factual basis for the plea, the agreement mentioned 

only a portion of the unpaid taxes—$197,458, which reflected 

the payroll taxes that had been withheld from the paychecks 

of employees at Pure Extractions and Wisconsin Logistics but 

not remitted to the IRS. Shibilski acknowledged responsibility 

for this portion of the tax loss as part of the factual basis for 

his plea; the agreement reserved a more complete accounting
6 No. 23-1410

of relevant conduct until sentencing. Shibilski entered his 

guilty plea a month later.

As expected, the presentence report (“PSR”) calculated a 

much larger tax loss as relevant conduct. The probation officer recommended that the court find Shibilski responsible 

for a total of $858,051 in tax losses. This figure included the 

amount Shibilski had acknowledged in the plea agreement, 

plus (1) the employer’s share of payroll taxes owed but never 

paid for employees of Pure Extractions and Wisconsin Logistics; and (2) all employment-related taxes for 5R—the unpaid 

employees’ share, which had been withheld but never paid to 

the IRS, and the employer’s share.

Shibilski objected to the PSR’s calculation of relevant conduct (among other objections). He insisted, implausibly, that 

he had not been in control of financial matters for the businesses—particularly not 5R’s financial operations—and so

should not be held responsible for the total amount of unpaid

payroll taxes.

To resolve the objections, the district judge scheduled the 

sentencing hearing over two days in February 2023, setting 

aside four hours on the first day and three hours on the second day. On the first day, the judge began by discussing the 

timeframe and parameters for the evidentiary presentations 

to ensure that the parties would use the allotted time efficiently. The judge estimated that witness testimony and the 

introduction of exhibits would consume the entirety of the 

first day. Shibilski’s attorney told the judge that his client 

would testify; the prosecutor said that he would trim his witness list to accommodate the defendant’s testimony and the 

court’s schedule.
No. 23-1410 7

Once the witness testimony was underway, Shibilski’s attorney immediately engaged in irrelevant and repetitious 

lines of inquiry. After the first witness, the judge urged defense counsel not to waste time on irrelevancies. From that 

point on, the judge periodically stepped in to instruct Shibilski’s attorney to avoid redundant questions or to move things 

along. As the clock ticked down toward the end of the first 

day, the judge said he would extend that day’s session for an 

extra 20 minutes or so, but he made it clear that he would not 

keep everyone in the courthouse beyond that time. Shibilski 

took the stand late that afternoon with only 20 minutes of 

hearing time remaining. The judge stuck to his timeline, 

halted Shibilski’s direct testimony when the time expired, and 

advised the parties that the hearing would continue with 

cross-examination on the morning of day two.

The hearing resumed on day two with Shibilski’s crossexamination, redirect by defense counsel, and recross by the 

prosecutor. In all, Shibilski was on the witness stand for a little 

over an hour. The judge then invited arguments from the attorneys about what the evidence had shown on the central 

dispute concerning Shibilski’s control of financial matters for 

the three companies. After exhausting that subject, the attorneys presented their sentencing arguments, uninterrupted by 

the judge except to the extent that he had questions. The judge 

then turned to the defendant for allocution. After cursory remarks about accepting responsibility, Shibilski spent most of 

his allocution statement complaining about the prosecution, 

shifting blame to his codefendants and others, minimizing his 

role in the crime, and portraying himself as a victim of character assassination by the government and fraud by others

who were involved in the business.
8 No. 23-1410

The judge ultimately rejected Shibilski’s objections and 

found him responsible for the entire tax loss as described in 

the PSR, basing his ruling on the “unequivocal” evidence that 

Shibilski had been in control of the financial operations of all 

three companies during the relevant period. Relying on that

same evidence, the government withdrew its recommendation for an offense-level reduction under § 3E1.1(a). The judge 

agreed that credit for acceptance of responsibility was unwarranted notwithstanding the guilty plea. The judge found that 

Shibilski had falsely denied relevant conduct, blamed others,

and otherwise minimized his role in the offense, all of which 

were inconsistent with acceptance of responsibility. The judge 

thus declined to award the two-point offense-level reduction 

under § 3E1.1(a).

These rulings produced a total offense level of 20, which 

when combined with a criminal history category of I yielded 

an advisory imprisonment range of 33 to 41 months. After

weighing the sentencing factors listed in 18 U.S.C. § 3553(a), 

the judge imposed a sentence of 33 months in prison.

II. Discussion

Shibilski raises three claims of sentencing error, arguing

that the judge (1) violated Rule 32(i)(4)(A)(i) by unduly curtailing his attorney’s presentation of evidence; (2) wrongly denied credit for acceptance of responsibility under § 3E1.1(a); 

and (3) committed procedural error by failing to meaningfully 

address the § 3553(a) sentencing factors.

The first argument misunderstands the rule and is unsupported by the record. Rule 32(i)(4)(A)(i) states only that the 

judge “must provide the defendant’s attorney an opportunity 

to speak on the defendant’s behalf.” FED. R. CRIM. P.
No. 23-1410 9

32(i)(4)(A)(i). The judge complied with this requirement. On 

day two of the hearing, he gave Shibilski’s attorney ample 

time to present a sentencing argument. Counsel fully availed 

himself of the opportunity—first by speaking at length when 

the judge invited the attorneys to discuss what the evidence 

had shown about Shibilski’s control of the three companies, 

and later by raising multiple arguments in mitigation when 

the judge entertained sentencing argument from each side. 

The judge did nothing to curtail or cut off counsel’s opportunity to speak on Shibilski’s behalf. The record conclusively 

refutes any argument to the contrary.

Shibilski’s argument appears to rest on a fundamental 

misreading of the rule. His complaint is that the judge unduly 

restricted his presentation of evidence during the sentencing 

hearing. A different part of Rule 32 pertains to evidentiary

submissions at sentencing. Rule 32(i)(2) provides that the 

judge may permit the parties to introduce evidence on objections to the PSR—not shall or must. Submission of evidence at 

sentencing is thus entrusted to the district court’s discretion.

See United States v. Cunningham, 883 F.3d 690, 699 (7th Cir. 

2018). Controlling the scope of witness testimony and setting 

reasonable time limits, as the judge did here, is perfectly consistent with the court’s exercise of this discretionary authority.

Shibilski next argues that the judge wrongly denied credit 

for acceptance of responsibility under § 3E1.1(a). A defendant 

may earn a two-level reduction in his Guidelines offense level 

if he “clearly demonstrates acceptance of responsibility for his 

offense.” U.S.S.G. § 3E1.1(a). To determine whether to apply 

this adjustment, the judge may consider whether the defendant has “truthfully admitt[ed] the conduct compromising the 
10 No. 23-1410

offense(s) of conviction” and “truthfully admitt[ed] or not 

falsely den[ied] any additional relevant conduct for which 

[he] is accountable.” Id. cmt. n.1. A defendant who falsely denies or frivolously contests relevant conduct “has acted in a 

manner inconsistent with acceptance of responsibility.” Id.

Moreover, attempts by the defendant to minimize his involvement in the offense are “sufficient to deny a reduction for acceptance of responsibility, even when the defendant has 

pleaded guilty.” United States v. Major, 33 F.4th 370, 382 (7th 

Cir. 2022).

It’s the defendant’s burden to prove by a preponderance 

of the evidence that he qualifies for the § 3E1.1(a) adjustment, 

and the district judge’s findings in this regard are entitled to 

“great deference.” § 3E1.1 cmt. n.5. At its core the § 3E1.1(a)

credit is based on a credibility judgment that the sentencing 

judge is best equipped to make. Id. We review the judge’s 

findings for clear error and will reverse only if we are left with 

the “definite and firm conviction” that a mistake was made. 

United States v. Collins, 796 F.3d 829, 835 (7th Cir. 2015) (internal quotation marks omitted).

We see no basis to disturb the judge’s § 3E1.1(a) ruling

here. Shibilski spills much ink over whether his objections to 

the PSR were legal challenges or good-faith factual challenges. We do not need to parse the record on this point. 

Shibilski’s own words—both from the witness stand and in 

his allocution statement—confirm that the judge had ample 

reason to deny credit for acceptance of responsibility.

Despite a lengthy paper trail and robust testimony establishing that he controlled financial matters for 5R and the two 

spinoff companies, Shibilski persisted in falsely denying responsibility for the total amount of unpaid employment taxes.
No. 23-1410 11

Though he made passing reference to his “unequivocal” acceptance of responsibility during his allocution, he focused 

mainly on minimizing his role, blaming his co-defendants

and the IRS, and painting himself as the victim of fraud by 

others. He assailed the prosecution as an attack on his character. He suggested that he had taken the fall for the misdeeds

of his codefendants, complaining that they had not “pa[id] a 

nickel in ... back taxes.” He speculated that he had been 

charged because he was the “last person standing.” He deflected responsibility for his conduct, complaining that his 

codefendants and others “took money, they took the company, and they boogied, and they’re going to point their finger at me and [] say I behaved dishonorably? Not true. I did 

not behave dishonorably, Your Honor.”

He continued to cast aspersions, telling the judge that he 

and his wife were the only ones affiliated with 5R who “paid 

a price.” He walked this comment back a bit when the judge 

reminded him that his codefendants received prison time and 

one was also ordered to pay $3 million in restitution for related environmental crimes. But in the next breath Shibilski

dismissed the codefendant’s restitution obligation as insignificant. Simply put, Shibilski’s persistent refusal to take ownership of his own actions amply justified the denial of credit 

under § 3E1.1(a). As the judge explained, he “blamed everybody but himself.”1

1 Shibilski also complains that he lacked notice that the court might not 

award credit for acceptance of responsibility. This is a nonstarter. The plea 

agreement and the guilty-plea colloquy provided clear notice that the 

court would rule on all Guidelines questions and determine the appropriate sentence.
12 No. 23-1410

Shibilski’s final argument is a procedural claim that the 

judge failed to meaningfully consider his principal arguments 

in mitigation under § 3553(a)—specifically, arguments concerning his lack of criminal history, his public service and reputation, his role as a caregiver for his aging mother, and the 

sentences of other § 7202 offenders. This argument is frivolous.

The judge need not march through the § 3553(a) factors in 

a “checklist fashion” at sentencing. United States v. Banks, 828 

F.3d 609, 618 (7th Cir. 2016). What’s required is a statement of 

reasons showing that the judge engaged in an individualized 

assessment, considered the defendant’s principal mitigation 

arguments—“even if implicitly and imprecisely”—and explained the sentencing decision in sufficient detail to permit 

meaningful appellate review. Id. (internal quotation marks 

omitted).

The judge said more than enough to discharge these obligations. He carefully considered the mitigating aspects of 

Shibilski’s background, including his public service, reputation in his community, and the circumstances regarding his 

infirm mother. The judge also addressed Shibilski’s argument 

about sentences for other § 7202 offenders, explaining that he 

consistently imposed prison sentences in tax-fraud cases. On 

this point specifically, it was not necessary for the judge to say 

more; indeed, he was not required to directly address and 

weigh the possibility of unwarranted sentencing disparities 

under § 3553(a)(6). We have repeatedly explained that the 

Guidelines “are themselves an anti-disparity formula.” United 

States v. Sanchez, 989 F.3d 523, 540 (7th Cir. 2021) (internal 

quotation marks omitted). A sentence within the Guidelines
No. 23-1410 13

range “necessarily complies with § 3553(a)(6).” Id. at 541 (internal quotation marks omitted).

In short, no procedural error occurred. The judge thoughtfully considered the § 3553(a) factors and Shibilski’s principal 

arguments in mitigation, and his explanation for the withinGuidelines sentence was clearly sufficient.2

AFFIRMED

2 After we heard oral argument, Shibilski sought a sentence reduction 

based on new, retroactive amendments to the Sentencing Guidelines. The 

judge expressed a willingness to reduce the sentence by two months, and

Shibilski notified us of this indicative ruling. FED. R. APP. P. 12.1. The resolution of this appeal clears the way for the proposed sentence modification.