* This order and judgment is not binding precedent, e xcept under the

doctrines of law of the case, res judicata, and col lateral 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 

### NOV 21 2001 

### PATRICK FISHER Clerk UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v. REUBEN GARCIA,

Defendant-Appellant. No. 01-8025 (D.C. No. 00-CR-101-02) (D. Wyo.)

ORDER AND JUDGMENT *

Before TACHA , Chief Judge, BALDOCK , Circuit Judge, and BRORBY , Senior Circuit Judge.

After examining the briefs and appellate record, th is panel has determined unanimously to grant the parties’ request for a dec ision on the briefs without oral argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument. Appellant Reuben Garcia challenges a two-level enhancement to his sentence for drug-related offenses, arguing that th e government failed to1 The November 1, 2000 Sentencing Guidelines were app lied by the district

court and apply to this appeal. -2- prove that he was a leader or organizer of criminal activity as described in Section 3B1.1(c) of the Sentencing Guidelines. 1 We exercise jurisdiction under 18 U.S.C. § 3742 and affirm.

I. Background Between April 1 and June 15, 2000, Mr. Garcia obtai ned methamphetamine and heroin from sources in California and paid a me thamphetamine addict, Walter J. Hei, to transport the drugs from California to M inneapolis, Minnesota, where the drugs were sold. On one occasion when Mr. Hei was driving to Minnesota, he was stopped by police in Wyoming for an expired reg istration, and the drugs were discovered with the assistance of a canine unit. M r. Garcia, Mr. Hei, and Mr. Garcia’s cousin, Amado Garcia (who was traveling wi th Mr. Hei when he was stopped by the police), were charged with conspirac y to possess and distribute methamphetamine. A superseding indictment charged Mr. Garcia with co nspiracy to possess with intent to distribute methamphetamine and heroi n, aiding and abetting possession with intent to distribute methamphetamin e, and aiding and abetting possession with intent to distribute heroin. Mr. G arcia pled guilty to all three counts of the superseding indictment.-3-

At his sentencing hearing, Mr. Garcia moved for a d ownward departure on the grounds that his criminal history was over repr esented, and objected to the government’s effort to seek a two-level enhancementto his sentence for his role as a leader or organizer in the offense. The sente ncing court granted the downward departure but imposed the two-level leader/organizer enhancement. In concluding that Mr. Garcia had served the role o f a leader/organizer, the sentencing court focused on the fact that Mr. Garci a recruited Mr. Hei, paid Mr. Hei, instructed Mr. Hei in trafficking, provide d Mr. Hei with specially crafted undergarments in which to transport the drugs, and otherwise controlled the logistics of the transport. The sentencing court r elied heavily on the investigative report and on testimony by Mr. Hei which the court observed in separate proceedings. Mr. Garcia now appeals the impositionof the enhancement.

II. Discussion Section 3B1.1(c) of the Sentencing Guidelines mandates that a defendant’s offense level be increased two levels “[i]f the def endant was an organizer, leader, manager, or supervisor in any criminal activity.” When the government seeks to increase a defendant’s sentence, it bears the burden of proving by a preponderance of the evidence that the increase i s justified. United States v.
Torres , 53 F.3d 1129, 1142 (10th Cir. 1995).-4-

When determining whether to impose a leader/organiz er enhancement, the sentencing court should consider the exercise of decision making authority, the natu re of participation in the commission of the offense, the recruitment o f accomplices, the claimed right to a larger share of the fruits of th e crime, the degree of participation in planning or organizing the offe nse . . . and the degree of control and authority exercised over othe rs. USSG § 3B1.1, cmt. (n.4) (2000). “In considering these factors, the sentencing court should remain conscious of the fac t that the gravamen of this enhancement is control, organization, and responsib ility for the actions of other individuals . . . .” Torres , 53 F.3d at 1142. The basic thrust of Mr. Garcia’s argument on appeal is that the government failed to meet its burden of proof because it faile d to introduce key facts into evidence and otherwise presented information that w as unreliable or insufficient. This assertion is reiterated through four distinct allegations of error: that the district court (1) impermissibly adopted the findin gs of the presentence report (PSR) and the investigative report; (2) impermissib ly considered unreliable hearsay; (3) impermissibly relied on information no t in evidence; and (4) failed to consider the factors relevant to determination o f whether Mr. Garcia was a leader/organizer. In reviewing a sentencing decision, we review the d istrict court’s legal conclusions de novo and its factual findings for cl ear error. United States v.2 Formerly Rule 32(c)(3)(D)

. -5-

Baez-Acuna , 54 F.3d 634, 638 (10th Cir. 1995). The determination that a defendant was a leader of a criminal activity is an issue of fact. United States v. Browning , 61 F.3d 752, 755 (10th Cir. 1995). Where a defendant failed to raise an issue before the sentencing court our review is for plain error only. United States v. Farnsworth , 92 F.3d 1001, 1007 (10th Cir. 1996).

A. The District Court Was Free to Adopt the Findings of the Investigative and Presentence Reports Mr. Garcia asserts that a sentencing court may not simply adopt the findings of the PSR (or, by extension, the findings in the investigative report that supports the PSR), citing Farnsworth

. See 92 F.3d at 1011. The prohibition stated in Farnsworth is based on Fed. R. Crim. Pro. 32(c)(1), 2 which requires that “[f]or each matter controverted [in the presentence report], the court must make either a finding on the allegation or a determinati on that no finding is necessary because the controverted matter will not be taken t o account in, or will not affect, sentencing.” The fact that a defendant has objected to the ultim ate conclusions drawn by the PSR, however, does not necessarily imply that a“controverted matter” exists. To successfully invoke the fact-finding obligation of Rule 32(c)(1), the defendant must make “specific allegations of factual inaccura cy.” United States v. Murray ,-6-

82 F.3d 361, 363 (10th Cir. 1996) (quoting United States v. Pedraza , 27 F.3d 1515, 1531 (10th Cir. 1994)); see also United States v. Huerta , 182 F.3d 361, 364 (5th Cir. 1999) (defendant’s rebuttal evidence must demonstrate that information in PSR is materially untrue, inaccurate or unreliable). Arguments that “challenge[] the district court’s application of the guidelines to the facts and not the facts themselves” do not trigger any obligation on the part of the district court to make specific findings. United States v. Windle , 74 F.3d 997, 1002 (10th Cir. 1996); see also United States v. Hall, 212 F.3d 1016, 1023 (7th Cir. 2000) (defendant must offer evidence beyond his own mere denials to prompt further inquiry into disputed sentencing issues). Here, Mr. Garcia lodged objections directly to the PSR and reiterated his objections both in a subsequent memorandum addressi ng sentencing issues and again at the sentencing hearing. In his objections , Mr. Garcia denied that he was a leader, claimed that he and Mr. Hei decided toget her to distribute the drugs in Minneapolis, and described their relationship as th at of “co-equals.” He did not, however, rebut any of the core facts supporting the conclusion that he was a leader or organizer, for example: that he paid Mr. Hei, purchased train tickets for one of the transports, and supplied the specially c rafted undergarments in which Mr. Hei transported the drugs. Because Mr. Garcia did not offer any evidence specifically controverting factual information in the PSR, the sentencing court-7-

was not prohibited from adopting the factual findin gs of the PSR or the investigative report.

B. The Hearsay Testimony Was Corroborated by Facts Admitted by the Defendant Mr. Garcia also argues that the sentencing court improperly considered unreliable hearsay in the form of the investigative report. In the report, a police officer recounted statements made by Mr. Hei regard ing the nature of his relationship with Mr. Garcia and described an under cover phone call from Mr. Hei to Mr. Garcia. The rules of evidence do not apply to sentencing he arings, and, as such, a sentencing court is free to consider hearsay that bears “some minimal indicia of reliability.” Browning , 61 F.3d at 755; see also USSG § 6A1.3(a). Such indicia of reliability are present here. We have previousl y held that hearsay may be sufficiently reliable if corroborated by facts admi tted by a defendant in pleading guilty to the indictment. See United States v. Roach , 978 F.2d 573, 576 (10th Cir. 1992) (hearsay testimony by agent reliab le even though contradicted by defendant’s testimony). Here, by pleading guilty to the indictment, Mr. Gar cia admitted that he asked Mr. Hei to transport the drugs, paid Mr. Hei, obtained and provided the drugs to Mr. Hei, provided specially crafted underg arments for transporting the drugs, paid Mr. Hei’s travel expenses, and verballydirected Mr. Hei’s actions3 One of Mr. Garcia’s primary arguments is that it wa s improper for the

sentencing court to rely on a description of this u ndercover phone call from Mr. Hei to Mr. Garcia. The essential facts of this pho ne call, however, were included in the factual basis of the indictment and thus adm itted by Mr. Garcia. -8- over the telephone. 3 These admitted facts provide sufficient corroboration for the hearsay testimony of the police officer.

C. It Was Not Plain Error for the Sentencing Court to Rely on Information Not in Evidence Mr. Garcia further argues that the sentencing courterred in relying on the investigative report because the government did notseek to have the report formally admitted into evidence. This objection wa s not raised before the sentencing court; therefore, our review is for plain error only. See Farnsworth , 92 F.3d at 1007. To demonstrate the existence of plain error, an appellant must show (1) there is error, (2) that is plain, and (3) thataffects substantial rights. Johnson v. United States , 520 U.S. 461, 466-67 (1997). In determining a sentence, the district court may appropriately consider all sources of information without limitation; the sole touchstone is reliability. See United States v. Beaulieu , 893 F.2d 1177, 1179 (10th Cir. 1990). Thus, the sentencing court may consider information that woul d be inadmissible at a criminal trial, including reliable hearsay and stat ements of co-defendants made in separate proceedings. See USSG § 6A1.3, cmt. ; Beaulieu , 893 F.2d at 1181.-9-

In light of the sentencing court’s virtually limitl ess prerogative to consider information known to it from a variety of sources, and in light of the admissions by Mr. Garcia detailed above, even if there was err or in not requiring the government to make a formal evidentiary submission, it did not affect Mr. Garcia’s substantial rights.

D. The Sentencing Court Adequately Considered the Relevant Sentencing Factors Finally, Mr. Garcia asserts that the sentencing cou rt failed to consider the factors outlined in the commentary to Section 3 B1.1. Specifically, Mr. Garcia points to the lack of any evidence pertaining to on e of the factors: whether he demanded a greater share of the profits. There is no merit to this argument. “[T]he commentary to this guideline does not mandat e that sentencing courts expressly consider each and every factor lis ted therein, but rather, it merely encourages it.” Torres , 53 F.3d at 1143. We have held that a defendant may be found to be a “leader” under Section 3B1.1(c ) based “upon a mere showing ‘that the defendant exercised any degree of direction or control over someone subordinate to him in the distribution sche me.’” Baez-Acuna , 54 F.3d at 639 (quoting United States v. Backas , 901 F.2d 1528, 1530 (10th Cir. 1990)). In light of the information contained in the invest igative report and Mr. Garcia’s own admissions based on the superseding indictment, there was ample evidence-10-

indicating that he exercised control over Mr. Hei i n the trafficking and distribution of the drugs at issue here. The judgment of the United States District Court fo r the District of Wyoming is AFFIRMED.

Entered for the Court

Bobby R. Baldock Circuit Judge