*

District Judge of the Western District of Louisiana, sitting by

designation.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

__________

NO. 97-30230

__________

UNITED STATES OF AMERICA,

Plaintiff-Appellee

VS.

ANTONIO A. GARCIA and

ARTHUR S. HUEY, IV,

Defendants-Appellants

_____________

Appeals from the United States District Court

for the Eastern District of Louisiana

_____________

February 19, 1998

Before JONES and SMITH, Circuit Judges, and SHAW*, District

Judge.

JOHN M. SHAW, District Judge:

I. Proceedings Below

Following a jury trial, Antonio Garcia and Arthur S. Huey, 

IV were convicted of conspiracy to distribute marijuana (count

1), making threats or using violence in order to collect an 
 

2

Garcia was sentenced to concurrent terms of imprisonment of 51 months on

counts 1 and 2 and to a term of imprisonment of 60 months on count 3, to be

served consecutively to the sentences imposed on counts 1 and 2. Huey was

sentenced to concurrent terms of imprisonment of 34 months on counts 1 and 2

and to a 60-month term of imprisonment on count 3, to be served consecutively

to the sentences on counts 1 and 2.

 

3

Huey was sentenced to concurrent terms of imprisonment of 30 months on

counts 1 and 2 and to a 60-month term of imprisonment on count 3, to be served

consecutively to the sentences on counts 1 and 2. Garcia was sentenced to

concurrent terms of imprisonment of 41 months on counts 1 and 2 and to a term

of imprisonment of 60 months on count 3, to be served consecutively to the

sentences imposed on counts 1 and 2.

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extension of credit (count 2), and use of a firearm in relation

to a crime of violence (count 3).2

The defendants appealed and argued that the jury selection

process violated Batson v. Kentucky, 476 U.S. 79 (1986) and its

progeny. See United States v. Huey, 76 F.3d 638, 639-40 (5th

Cir. 1996). The court determined that the discriminatory jury

selection method employed violated Batson and its progeny,

reversed the defendants' convictions, and remanded the case for a

new trial. Id. at 641-42.

Following remand, the defendants waived their right to a

jury trial, and the parties stipulated that the retrial would be

based on the testimony and evidence admitted at the original

trial. The district court again found the defendants guilty of

all three counts.3

II. Factual Background

Marshall Howell purchased 40-50 pounds of marijuana from

Huey and Garcia over a one-year period. Howell, who lived in

Tuscaloosa, Alabama, was allowed to obtain 4 or 5 pounds of the

drug at one time from Huey in New Orleans. On some occasions,
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Howell did not pay Huey for the marijuana until he had sold the

drugs. During the initial transactions, Howell would travel to

New Orleans and pick up 4 or 5 pounds of marijuana and return to

Tuscaloosa to sell the drugs. He would then either return to New

Orleans with the payment or send the money to Huey by Western

Union. Sometimes, Howell paid "on the spot" and other times, he

took the drugs with the expectation that he was to sell them and

pay when he collected the money. Huey brought Howell a little

less than 15 pounds of marijuana prior to Thanksgiving in 1993. 

Howell told Huey that he could pay him for two-thirds of the

marijuana but that he did not have the remaining $5,900 due for

the drugs and agreed to pay the remainder as soon as he got the

money.

Huey waited in Tuscaloosa for payment for several weeks and

then returned to New Orleans when he felt that Howell was not

going to pay him. Garcia subsequently called Howell and told him

that he was sending someone to his house to collect the money. 

Howell had several telephone conversations with Huey about the

money, and Huey told him that if he did not pay the debt by the

first of the year, something would happen to his family. Howell

testified that he was given a few different deadlines but that

the defendants agreed to the extensions because they had no other

choice. Howell testified that he had agreed to meet the

defendants in Mississippi on December 12 to pay the debt but that

he had no intention of meeting them because he did not have the

money. Howell fled to Birmingham because he feared that the
4

defendants would go to his Tuscaloosa apartment to collect it. 

The defendants went to Howell's apartment on December 12,

ransacked the place, and left a message on his recorder. Huey

and Garcia returned to the apartment the following evening and

demanded their money from a friend of Howell's who was staying

there. Garcia threatened to rape and kill Howell's mother and to

kill Howell's brother if Howell did not pay.

Garcia made a threat to kill Howell's brother on Howell's

mother's phone recorder on December 21 and claimed interest on

the debt at the rate of $500 per day. Howell continued to

receive calls from Huey, who continued to demand payment of the

money due. Huey continued to press Howell for the money through

January and told him that payment of the $6,000 principal would

be sufficient. Howell testified that he never directly received

the marijuana from Garcia but acknowledged that he owed him the

money for the drugs delivered by Huey. After these incidents,

Howell decided to cooperate with the FBI and tape his telephone

calls, resulting in the indictment of Huey and Garcia.

III. Issues on Appeal

A. Garcia and Huey both contend that the evidence was

insufficient to prove beyond a reasonable doubt that they

extended credit to the victim.

B. Huey also contends that there was insufficient evidence

to prove beyond a reasonable doubt that Huey used or carried a

firearm during a crime of violence.

C. Additionally, Garcia contends that the court a quo
5

erred in denying him a three-level reduction of his sentence for

acceptance of responsibility.

IV. Discussion

A. Extension of Credit:

Congress makes it a crime to knowingly participate or to

conspire to participate in the use of any extortionate means "to

collect or attempt to collect any extension of credit." 18

U.S.C. § 894(a)(1). 

Extension of credit has been defined by this circuit to mean

"to make or renew any loan, or to enter into any agreement, tacit

or express, whereby the repayment or satisfaction of any debt or

claim, whether acknowledged or disputed, valid or invalid, and

however arising, may or will be deferred." United States v.

Stokes, 944 F.2d 211, 214 (5th Cir. 1991).

The circuits are not in agreement on the showing necessary

to prove an agreement to defer payment. This circuit requires

proof of some manifestation by the creditor of his assent to

defer payment. Stokes, supra. Therein, the court explained that

the agreement could be tacit or express and requires at a

minimum, proof of conduct by the creditor manifesting assent to

defer payments. In Stokes, the evidence did not reveal any

conduct on the part of the creditor tending to show his

willingness to allow the victim any "slack."

In United States v. Natale, 764 F.2d 1042 (5th Cir. 1985),

the court found there was an agreement to defer the payment of
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the claim. The court set forth the standard of review as to

whether there is sufficient evidence to sustain a conviction

beyond a reasonable doubt, stating that we must consider the

evidence direct and circumstantial in the light most favorable to

the Government.

Herein, the evidence supports a finding that Garcia and Huey

extended credit by manifesting an assent to defer payment. 

Otherwise, the defendants would have only given Howell the amount

of marijuana he could pay for rather than the full 15 pounds and

allow him to pay for the balance at a later date. The evidence

in the record is clear that this type of arrangement was

consistent with their prior course of dealing.

The district court determined that the evidence established

that credit was extended to Howell at the initial delivery of the

marijuana. It further determined that a tacit agreement to defer

payment was made at the time Howell was allowed to pay for only

two-thirds of the drugs delivered to him by Huey. The district

court further determined that this agreement was the modus

operandi based on Howell's testimony that on several occasions he

had paid Huey for part of the marijuana and then wired or

delivered the balance due at a later time. The district court

rejected the defendants' contention that they did not allow

Howell any "slack." The district court determined that the 
 

4

In applying the "substantial evidence" or the "sufficiency of the evidence

standard", the court must consider the evidence in light most favorable to the

Government and must determine whether the evidence is sufficient to justify

the district court's determination that the defendant is guilty beyond a

reasonable doubt.

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defendants did not formulate their claims until they concluded

that Howell did not intend to pay.

In determining that credit was extended, the court below

must have been impressed with a "message [from] Garcia" left on

Howell's mother's answering machine that acknowledged the debt

and that interest was accruing daily. The standard of review for

a district court's finding of guilt at a bench trial is whether

the conviction is supported by substantial evidence. United

States v. Cardenas, 9 F.3d 1139, 1156 (5th Cir. 1993).4

The panel in Stokes cited with approval the Seventh Circuit

opinion of United States v. Boulahanis, 677 F.2d 586 (7th Cir.

1982), wherein the court found that the Government failed to

prove a violation of 18 U.S.C. § 894. It stated that "[t]he

extension of credit is a deliberate act by a creditor. It does

not occur merely because a customer defaults. Section 894 does

not make it a crime to use extortion to collect debts, but only

to exact repayment of credit previously extended." This view is

on all fours with the court in Stokes. It should be noted,

however, that Boulahanis also stands for the proposition that if

additional time is given the victim to pay, that could constitute

an agreement to defer payment of a debt and such a deferral would

be within the reach of section 894.
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In view of the evidence above, reviewed in the light most

favorable to the Government, we affirm the finding of the

district court that Garcia and Huey extended credit to Howell

thus violating section 894. It should be made clear however,

that our decision herein does not stand for the proposition that

in every drug transaction where full payment is not made

immediately upon delivery that there is an extension of credit

that could bring section 894 into play.

The defendants in their briefs and at oral argument contend

that the transaction was a consignment rather than an extension

of credit and therefore, section 894 is not applicable herein. 

This is an attempt to liken the case to United States v. Wallace,

59 F.3d 333 (2d Cir. 1995), a prosecution stemming from a bank

fraud scheme. Garcia and Huey's reliance on Wallace is

misplaced. There, the Second Circuit held that the defendants

did not "extend credit" under section 894; rather, "[t]he closest

commercial analog to the [instant] transaction is a consignment

in which the obligation to pay is contingent and no title passes. 

There was no indication that [the victim] would pay [the

defendant] if the scheme to defraud the bank had failed." Id. at

339. The court concluded that "none of the evidence presented at

trial amounted to the formation of a credit agreement, because

[the defendant] and his representatives never 'agree[d]' to

'defer[]' the collection of their money." Id. at 339. Here,

Garcia and Huey agreed to defer collection from the moment of the

sale. It would be a stretch to characterize the drug deal as a 
 

5

Overt act 1. of Count 1 reads:

ANTONIO A. GARCIA and ARTHUR S. HUEY, IV distributed 

various quantities of marijuana to Marshall Howell and others on a

consignment basis whereby Marshall Howell and others would take

possession of the marijuana, sell it at a sufficient price to make

a profit, and then subsequently pay ANTONIO A. GARCIA and ARTHUR

S. HUEY, IV.

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"consignment" in which Howell's obligation to pay Garcia and Huey

was contingent on Howell's success in reselling the marijuana.

The defendants argue that the use of the word "consignment"

in the overt act to describe the transaction in which Howell and

others took possession of the marijuana, sold it at a significant

price to make a profit, and then subsequently paid the

defendants, has some legal significance. This court finds that

such a misnomer does not change the result herein.5 The AUSA

conceded that he was responsible and that it was a bad choice of

words. There was no serious contention that the use of the word

caused any prejudice. The Government in the indictment was

sufficiently particular and definite to advise the defendants of

the charge against them so to enable them to prepare their

defense. Further, there is nothing in the charge to the jury in

the first trial to suggest that proof requiring the use of

extortionate means in an attempt to collect an extension of

credit would encompass a consignment. The instruction was clear

that an extension of credit involves the deferral of a repayment 
 

6

The court instructed the jury on the elements of the offense as follows:

Now I am going to give you the elements with respect to Count 2.

Count 2 is as follows:

Title 18 of U.S. Code Section 894(a)(1) makes it a crime to 

conspire in the use of extortionate means in an attempt to collect

an extension of credit.

An 'extortionate means' is any means which in the use or an 

express or implicit threat of use of violence or other criminal

means to cause harm to the person, reputation, or property of any

person.

To extend credit means to make or renew any loan or to enter

into any agreement, tacit or expressed, whereby the repayment or

satisfaction of any debt or claim, whether acknowledged or

disputed, valid or invalid, and however arising, may or will be

deferred.

For you to find the defendants guilty of this crime, you must

be convinced the government has proved the following beyond a

reasonable doubt:

That two or more persons made an agreement to commit the crime

of the use of extortionate means in an attempt to collect an

extension of credit as alleged in Count Two.

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of a debt which rejects the concept of a consignment which

creates no debt.6

B. Use of a Firearm During a Crime

Huey challenges the sufficiency of the evidence supporting

his conviction for using or carrying a firearm in relation to a

crime of violence under 18 U.S.C. § 924(c)(1). Huey admits that

he carried the weapon during the commission of a crime of

violence but contends that he did not "use" it within the meaning

of Bailey v. United States, 116 S.Ct. 501 (1995). If an

indictment alleges separate offenses in the conjunctive, the

Government is required to prove only one of the offenses to

obtain a conviction. United States v. Merida, 765 F.2d 1205,

1222 (5th Cir. 1985).

Huey acknowledges that he was carrying the weapon during the

commission of a crime of violence. There was sufficient evidence
11

to support Huey's conviction for carrying a firearm.

C. Acceptance of Responsibility

Garcia claims that the district court misapplied the

guidelines by failing to reduce his offense level by an

additional level for acceptance of responsibility. He argues

that he is entitled to the one-level reduction because he never

denied his participation in the offense and that after remand, he

consistently indicated a desire to accept responsibility and

agreed to stipulate to the evidence to avert the time and expense

of another trial. He argues that he should not be penalized for

exercising his right to appeal a question of law. He states that

he only requested a new trial to preserve the sufficiency of the

evidence.

This court reviews a district court's finding on acceptance

of responsibility for clear error but under a standard of review

even more deferential than a pure clearly erroneous standard. 

United States v. Gonzales, 19 F.3d 982, 983 (5th Cir. 1994);

United States v. Tello, 9 F.3d 1119 (5th Cir. 1993). Section

3E1.1(b) sets forth a three-part test to determine whether a

defendant is entitled to a one-level reduction. The sentencing

court is directed to grant the additional decrease if:

1. the defendant qualifies for the basic two-level 

decrease for acceptance of responsibility

under section 3E1.1(a);

2. the defendant's offense level is 16 or higher 

before the two-level reduction under section
 

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In United States v. Leonard, 61 F.3d 1181, 1187 (5th Cir. 1995), the court

determined that the defendant's waiver of his right to jury trial and

agreement to stipulate to most of the evidence did not entitle him to an

additional one-level adjustment because he did not plead guilty and the

Government was still required to use its resources at trial.

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3E1.1(a); and,

3. the defendant timely assisted authorities by 

either providing complete information to the

Government concerning his own involvement in

the offense or timely notified authorities of

his intention to enter a plea of guilty,

thereby permitting the Government to avoid

preparing for trial and permitting the court

to allocate its resources efficiently.

Tello at 1124-1125.

Garcia meets the first two requirements of the Tello test

but not the third.7 The district court accordingly did not err

in denying Garcia an additional one-level reduction.

AFFIRMED.