* This order and judgment is not binding precedent except under the

doctrines of law of the case, res judicata and collateral estoppel. The court generally disfavors the citation of orders and judg ments; nevertheless, an order and judgment may be cited under the terms and condi tions of 10th Cir. R. 36.3. 

## F I L E D United States Court of Appeals Tenth Circuit 

### DEC 23 2003 

### PATRICK FISHER Clerk UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

UNITED STATES OF AMERICA, Plaintiff-Appellant,

v. JOHN THOMAS MORRIS, Defendant-Appellee. No. 03-2029 (D. New Mexico) (D. Ct. No. CR-00-1341 MV)

ORDER AND JUDGMENT *

Before SEYMOUR , MURPHY , and O’BRIEN , Circuit Judges.

After examining the briefs and appellate record, th is panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). T he case is therefore ordered submitted without oral argument. John Thomas Morris pled guilty to three counts of f alsifying hazardous-2-

waste manifests in violation of the Resource and Re covery Act, 42 U.S.C. § 6928(d)(3). On appeal, we review the district court’s failure to apply a four-level enhancement to Morris’s offense level pursuant to U nited States Sentencing Guideline (USSG) § 2Q1.2(b)(4). Our jurisdiction arises under 18 U.S.C. § 3742(b)(2). We reverse and remand for resentencing

. Background General Waste Corporation (GWC) is a New Mexico sol id waste management business licensed to remove hazardous wa ste from generating facilities and transport it to final disposal facil ities. A hazardous waste transporter must obtain a permit to store such wast e for more than ten days. 40 C.F.R. §§ 262.30 and 270.1(c)(2)(vi). On October 4, 2000, a federal grand jury indicted M orris, along with Emmanuel M. Ohiri, GWC’s chief executive officer, a nd the GWC corporate entity, on twenty-five counts of various environmen tal violations, including knowingly making false statements on manifests, the illegal transportation of hazardous waste, the illegal storage of hazardous w aste, and conspiracy to commit these violations. On March 20, 2001, Morris pled g uilty to three counts of knowingly making false material statements and repr esentations on manifests used for the purpose of compliance with the Resources an d Conservation Recovery Act, 42 U.S.C. § 6928(d)(3). The plea included Morris’s agreement that “he1 In supplements to the presentence report, the probation officer continued

to maintain that the four-level enhancement under § 2Q1.2(b)(4) was appropriate due to Morris’s relevant conduct. See § 1B1.3(a)(1)(A).

2 Morris stated: I was employed at General Waste Corporation (GWC) f rom July of 1997 to July of 1998. My title was Operations Mana ger. My responsibilities entailed over sight of the Hazardo us Waste activities, Construction Debris disposal, and Sales. * * * * * -3- [would] not seek a downward departure from the appl icable sentencing guideline range as determined by the Court after resolution o f any objections by either party to the presentence report . . . .” In exchange, th e government dismissed the remainder of the charges and agreed to forego bring ing additional charges. The probation officer’s initial presentence report recommended, inter alia , the court apply USSG § 2Q1.2(b)(4), which provides a four-level enhancement for an offense involving the “transportation, treatment , storage or disposal [of hazardous waste] without a permit or in violation o f a permit.” The report justified the recommendation by noting Morris’s rel evant conduct “involved picking up hazardous waste . . . , storing that was te illegally, then falsifying the manifests for those wastes.” 1 The report also included Morris’s written stateme nt in which he admits to creating false manifests and forging signatures on those manifests to disguise the storage of hazardous wast e for an “extended amount of time” without the necessary permits. 2Once the waste in the warehouse was organized, I st arted to make

sales contacts with hazardous waste accounts I had managed prior to my employment with GWC. My previous employer . . . had an authorization granted by the State of New Mexico to store Hazardous waste . . . up to 180 days [after it was] received . . . [as a] conditionally exempt small quantity waste generator(CESQG). Without this type of authorization, a waste managem ent transporter could only store the waste for no more than 10 days . I personally made the decision, on my own accord, to operate GWC as if we were authorized as [a] 180 day storage and accumulation facility. I created uniform hazardous waste shipping manifests for GWC as the receiving facility. I then re-manifested the waste containers and had GWC designated as a generator for outbound waste di sposal. I intentionally did this for building or aggregating larger out bound shipments of [ sic ] economical reasons. Manny Ohiri was not informed of my waste management strategy and techni ques in this particular case. * * * * * In order to maintain my waste management accounts a nd integrity, I would change dates on various small quantity generator (SQG) manifests due to the waste facility non-approval st atus. I would pick up waste without obtaining disposal facility prior approval and would hold the waste over an extended amount of time unti l the approval was in place. I had recreated waste manifests and forged signatures to be in compliance and to elude the waste generato r and the disposal facility. Manny Ohiri was not informed of this act ivity.

3 “‘Simple recordkeeping or reporting violation’ mea ns a recordkeeping or reporting offense in a situation where the defendan t neither knew nor had reason to believe that the recordkeeping offense would sig nificantly increase the likelihood of any substantive environmental harm.” USSG § 2Q1.2, comment. (n. -4- Morris filed various objections to the report, incl uding an objection to the proposed four-level enhancement. Primarily, he cla imed § 2Q1.2(b)(4)’s enhancement only applies to substantive offenses rather than his offense of conviction — a “simple recordkeeping offense.” 32); see also Ch.1, Pt.A4(f), intro. comment. (“[T]he Commissio n has developed a

system for treating technical recordkeeping and rep orting offenses that divides them into four categories. First, in the simplest of cases, the offender may have failed to fill out a form intentionally, but withou t knowledge or intent that substantive harm would likely follow.”) -5- The government countered that Morris committed his recordkeeping offense for the purpose of concealing a substantive offense, an d therefore his relevant conduct placed the offense within § 2Q1.2(b)(5), requiring the application of the (b)(4) enhancement. To support its argument, the governme nt offered copies of the falsified manifests. It also presented a letter written by O hiri, Morris’s supervisor, to a customer at a generating facility. The letter resp onded to the customer’s complaints of discrepancies between a manifest received from M orris and the copy from the final disposal facility. One of the transactions in question, detailed by th ree manifests, proves illustrative. The first manifest notes a November 24 pickup date of hazardous waste along with the true signature of the generating cus tomer. The second manifest notes the same pickup date but with delivery to the final disposal facility dated ten days later (December 5), along with a forged disposal fa cility signature. And while the third manifest involves the same transaction, the p ickup date has been changed to January 12, and the delivery date changed to January 21, along with a forged signature of the generating customer. Ohiri explained in his letter that the discrepancies between the dates on the manifests we re due to Morris’s failure to4 Application note 8 actually discusses the possibil ity of a departure (not an

enhancement) of up to two levels (up or down), shou ld the facts warrant.

5 The district court referred to an unpublished decis ion, United States v. Hart , 61 F.3d 917, 1995 WL 445685 (10th Cir. Jul. 28, 1 995) (table decision), cert. denied, 516 U.S. 1062 (1996), which discussed the finding s necessary to apply relevant conduct under USSG § 1B.1.3(a)(2). We determine this case solely on the basis of USSG §1B.1.3(a)(1). “[I]f a defend ant’s accountability is established under one provision of this guideline [ § 1B.1.3], it is not necessary to review alternative provisions under which such acco untability might be established.” § 1B1.3, comment. note 2(a)(1). The refore, the holding in Hartis not relevant to this case. -6- obtain timely approval for transport to an appropri ate waste facility: “Mr. Morris recreated the manifests to meet the 10 day EPA limi tation for [the] GWC facility.” Rejecting the government’s analysis of this evidenc e, Morris argued that retention of the waste without a permit “was not re levant conduct as to the offense of conviction” warranting an enhanced sentence. He further argued that even if the enhancement was germane, application note 8 to § 2Q 1.3 requires the court to weigh the nature and quality of the hazardous substance i nvolved and the risk associated with the offender’s conduct before applying the enh ancement. 4 Morris concluded that the evidence, at best, warranted only a two-level e nhancement. Apparently accepting the need to weigh such evidenc e, the district judge questioned Morris as to the nature of the waste det ailed in the manifests and determined “the Court [had] not received sufficientevidence, either in the presentence report or in the presentation of eviden ce [at the hearing], to permit the Court to make the findings that are required.” 5 She further stated she did not have-7-

sufficient evidence to apply application note 8's two-level “enhancement” and therefore declined to apply any enhancement. She s entenced Morris to three years probation, on the condition that six months be serv ed in some form of custody. This appeal followed.
Discussion We consider whether the district court correctly re fused to impose USSG § 2Q1.2(b)(4)’s four-level enhancement. We review de novo the district court’s legal interpretation of the Guidelines as well as its con clusion that the evidence is insufficient as a matter of law to warrant the enha ncement. See United States v. Valdez, 225 F.3d 1137, 1142 (10th Cir. 2000) (citing United States v. Checora, 175 F.3d 782, 789 (10th Cir. 1999)), cert. denied, 532 U.S. 996 (2001). At the risk of appearing didactic, we begin our ana lysis by reviewing the general approach to be used in applying the Guideli nes. Once the correct guideline is identified (the parties agree it is § 2Q1.2) and th e base level is established (the parties agree it is eight) it is necessary to “apply any ap propriate specific offense characteristics, cross references, and special inst ructions contained in the particular Guideline . . . in the order listed .” USSG § 1B.1.1(b) (emphasis added) ; see generally , USSG §§ 1B.1.1 & 1B.1.2. But those factors are all determined by reference to what has become known as the offender’ s “relevant conduct,” not merely the offense of conviction. USSG § 1B1.3. Conseque ntly, our review first leads us to6 “This paragraph prevents a plea agreement from res tricting consideration

of conduct that is within the scope of §1B1.3 (Rele vant Conduct) in respect to the count(s) of which the defendant is convicted; it do es not in any way expand or modify the scope of §1B1.3 (Relevant Conduct).” US SG §6B1.2, comment.

-8- consider relevant conduct. Relevant conduct is a shorthand term for the Guidel ine’s requirement that offense characteristics and adjustments “shall be d etermined on the basis of . . . all acts and omissions committed, . . . induced, procured, o r willfully caused by the defendant . . . that occurred during the commission of the of fense of conviction , in preparation for that offense, or in the course of attempting to avo id detection or responsibility for that offense . . . .” USSG §1B1.3(a) (emphasis added). “[A] plea agreement that includes the dismissal of a charge . . . shall not preclude the conduct underlying such charge from being considered under the provisions of § 1B1 .3 (Relevant Conduct) in connection with the count(s) of which the defendantis convicted.” USSG § 6B1.2(a). 6 The presentence report identified Morris’s relevantconduct to be the illegal storage of hazardous waste without a permit even though a reco rd keeping violation was the offense of conviction. When the government seeks to use the defendant’s re levant conduct to increase his base offense level, “it must show that the rele vant conduct occurred by a preponderance of the evidence.” United States v. Sapp , 53 F.3d 1100, 1104 (10th Cir. 1995) (citation omitted), cert. denied, 516 U.S. 1082 (1996). Subsection (b)(4) of §7 The arguments seem, almost by design, to eschew st raightforward analysis

of the issue in order to “obscure it in a legal fog .” Zadvydas v. Davis , 533 U.S. 678, 703 (2001) (Scalia, J., dissenting). A desult ory approach, while sometimes successful, is rarely productive and always ineffic ient. -9- 2Q1.2 states that a four-level enhancement is requi red when “the offense involved transportation, treatment, storage or disposal with out a permit or in violation of a permit.” Morris’s admissions in the presentence re port clearly establish his knowledge that the storage of hazardous waste for more than t en days required a permit and GWC did not have the required permit. See infra , note 2. Morris also admits that he recreated manifests and forged signatures to avoid detection of the illegal hazardous waste storage
at GWC. Id . Morris’s admissions are corroborated by the mani fests showing the alteration of dates and signatures. At no time did Morris object to or contradict this evidence, he merely objected to the enhancement. T hus, the uncontested evidence demonstrates that the probation report is correct; Morris’s relevant conduct is described by specific offense characteristic § 2Q1.2(b)(4) be cause “the offense involved transportation , treatment, storage , or disposal without a permitor in violation of a permit . . .”, which demands a four-level enhanceme nt. (Emphasis added.) In the district court the parties argued at length about the proper application of §§ 2Q1.2(b)(5) and (6). Those arguments continue h ere, but are unavailing. 7 Because they do not inform the debate we will not address t hem. When specific offense characteristics are applied sequentially, as the Gu idelines require, the exercise is-10-

complete upon reaching § 2Q1.2(b)(4). That section properly defines the offense for sentencing purposes and it is unnecessary to contin ue down the list. Stated differently, since relevant conduct necessarily defines the offe nse otherwise, it cannot be a record keeping offense (§ 2Q1.2(b)(5)) or a simple record keeping offense (§ 2Q1.2(b)(6)). Once relevant conduct was established (as stated, t he relevant conduct facts are compelling and undisputed, therefore conclusive), a dditional fact finding was unnecessary, except as it might impact a departure decision. To that end we consider the departure guidance cont ained in application note 8, which says: Subsection (b)(4) applies where the offense involve s violation of a permit, or where there was a failure to obtain a permit whe n one was required. Depending upon the nature and the quantity of the s ubstance involved and the risk associated with the offense, a departure of up to two levels, either upward or downward may be warranted. (Emphasis added.) Morris suggests application note 8 is actually an adjustment, not a departure, because it changes the offense level. ( R., Appellee Br. at 16.) He is mistaken. The distinction between an adjustment and a departu re is critical. United States v. Smith , 930 F.2d 1450, 1453 (10th Cir.), cert. denied, 502 U.S. 879 (1991). The district court may consider a departure only after completin g the adjustments required in the offense guideline. Application note 8 necessarily presumes all adjustments have been made when it invites departure consideration. USSG § 1B.1.1(h) and (i). Moreover,-11-

Chapter 1, Part A(4)(b) of the Guidelines states: It is important to note that the guidelines refer t o two different kinds of departure . The first involves instances in which the guidel ines provide specific guidance for departure by analogy or by ot her numerical or nonnumerical suggestions. The Commission intends suchsuggestions as policy guidance for the courts. The Commission expects th at most departures will reflect the suggestions and that the courts of appe als may prove more likely to find departures “unreasonable” where they fall o utside suggested levels. A second type of departure will remain unguided. I t may rest upon grounds referred to in Chapter Five, Part K (Departures) oron grounds not mentioned in the guidelines.
(Emphasis added.) Application note 8 clearly state s a departure may be warranted, the type of departure explicitly described in the introductory comments quoted above. We will not ignore such express direction, nor will we allow Morris to ignore the terms of his plea agreement which preclude argument for a do wnward departure. On remand, evidence or argument supporting a downward departur e is foreclosed.
Conclusion The uncontroverted evidence presented at the senten cing hearing established Morris’s relevant conduct as the illegal storage of hazardous waste without a permit. The district court is required to apply the four-le vel enhancement found in USSG §2Q1.2(b)(4). Application Note 8 is not pertinent to Morris’s sentencing, as he has waived his right to argue for a downward departure in his plea agreement. This case is-12-

REVERSED and REMANDED for resentencing in accordance with USSG § 2Q1.2(b)(4).

Entered by the Court:

TERRENCE L. O’BRIEN United States Circuit Judge