F OR P UBLICATION



### UNIT E D ST AT E S CO URT O F APPE AL S FO R T H E NINT H CIRCUIT

U N I T E D S T A T E S O F A M E R I C A , Plaintiff-Appellee

,

v

.

C O L L I N S M A X C H R I S T E N S E N , AKA Collie Christensen,

Defendant-Appellant

. N o. 11-10562

D.C. No. 2:11-cr-00070- J AM-1

OPI NI ON

A ppeal from the United States District Court for the Eastern District of California J ohn A. Mendez , District J udg e , Presiding

Arg ued and Submitted J une 10, 2013—San F rancisco, California

F iled October 11, 2013

B efore: A. W a llace Tashima and J ay S. B y bee, Circuit J udg es, and W illiam H. Stafford, Senior District J udg e. *

Opinion by

J udg e Stafford; Dissent by

J udg e Tashima

* T h e Ho n o rab le W illiam H. Staf f ord

, J r., Sen io r District Ju d g e f o r th e Un i ted States District C o u rt f or th e No rth ern District o f Flo rid a, sittin g b y d esig n atio n

.U N I T E D S T A T E S V

. C H R I S T E N S E N 2

SUMMARY * *

Crim inal Law

The panel affi r m e d a sentence imposed following the defendant’s g uilty plea to wire fraud in connection with a real estate investment scheme.

The panel h eld that the record supports the district court’s conclusion that the Sentencing G uidelines did not prop e r l y take into account the harm caused b y the eg reg iousness o f the defenda n t ’ s conduct, and that this conclusion d id not constitute impermissible double-counting

.
Reg arding the defendant’s content ion that the district
court improperly discounted the defendant’s ac c eptance o f responsibility

, the panel h el d that the f act that the defendant received a three-level Guidelines reduction for acceptance o f responsibility but ended up w i th an above-Guidelines
sentence is insufficient to leave the panel with a definite a nd firm conviction that the district court erred.

Reviewing for p lain error, the pane l d e emed u navailing unpreserved contentions that the district c ourt com m i t t ed procedural error by

among other thing s ( 1) failing to resolve factual confli c t s in the presentence report r eg arding victim impact and loss amounts; (2) f ailing to provide advance

n o t i ce of the precise g rounds for an upward variance; a n d (3) improperly relying on clearly erroneous f acts, speculative evidence, and unreliable victim statements.

** T h is su m m ary co n stitu

t es n o p ar t o f t h e o p in io n o f th e co u rt. It h as b een p rep ared b y

co u rt staf

f f o r th e co n v en i en ce o f

th e read er.U N I T E D S T A T E S V

. C H R I S T E N S E N 3

Dissent ing

, J udg e Tashima wrote that the district court committed prejudicial, sig nificant p r ocedural error in imposing an upward variance on the basis of investor losses that were not attributable to the defendant’s criminal conduct.

COUNSEL

C ourtney J

. L inn (arg

ued) and McGreg or W

. Scott, O rric k Herr ing ton & Sutcliffe L L P, Sacramento, California, for Defendant-Appellant.

Camil A

. Skipper ( arg ued), Assistant United States Attorney
, B enjamin B

. W ag ner, U n i t ed States Attorney
, Russell L

. Carlberg

, Assistant United St ates Attorney
, Sacramento, California, for Plaintiff-Appellee.

OP INION

STAF F ORD, Senior District J udg e:

Collins Max Christense n a p peals the sentence imposed b y the district court following his p r e -indictment g uilty plea to

on e c o u nt of w ire fraud in violation of 18 U.S.C. § 1343. Christensen’s sentence—60 months in prison—was 19 months abo v e the h ig h end of the applicable advisory
g u i deline rang e and 2 7 months above the recommended
sentence set out in the plea ag reement. We have jurisdiction under 28 U.S.C. § 1291, and we affirm.U N I T E D S T A T E S V

. C H R I S T E N S E N 4

I

.

Christensen waived indictm ent by a g rand jury a nd pleaded g uilty to a one-count information charg ing wire f r a ud. The plea ag reement revealed that, between 200 6 a n d 2008, Christensen manag ed the operations of at least six land d e v elopment companies, which—in turn—manag ed multipl e real estate projects spearheaded b y Christensen. B y soliciting individual invest o rs, Christensen received a total o f
approx imately $2,385,959 from fourteen individuals w ho
ag reed to invest in o ne or more of Christensen’ s p ro j e cts. Over t i m e , Christensen diverted a sig nificant amount o f the investors’ funds, u sing the diverted funds f o r u ndisclosed
p u r p o s e s

. I n d e e d

, C h r i s t e n s e n a d m i t t e d t h a t h e misappropriated approx imately $985,994 of investors’ funds using the interstate wires to further his c r i m inal scheme. Christensen f

u rther admitted that he diverted investors’ funds

n o t only for use on undisclosed real estate projects but a lso for his own personal use.

I n the Presentence I nvestig ation Report (“PSR”), the probation officer summariz ed the losses sustaine d by the various “ victims” of Christensen’s o ffense o f conviction. Only those persons who had some o r all of their investment funds unlawfully d iverted by Christensen w ere listed a s “victims” of Christensen’s offense. Consistent with the plea
ag reeme n t , the total “ victim” loss reported b y the p robation officer was $985,994.

Given the loss amount reported in the PSR and admitted by Christensen, the p r obation officer calculated a total offense level of 20, inclu d i n g a three-level reduction for acceptance of responsibility

. With a c ri m inal history categ ory of I
, the recommended sentencing rang e under theU N I T E D S T A T E S V

. C H R I S T E N S E N 5

Guidelines was 33 to 41 months. Christensen ag reed with the probation officer’s Guidelines calculations.

The probation officer included in the PSR a sampling o f the w ritten statements that Christensen’s “victims” submitted
to the court. I n his i n f

o r mal objections to the PSR, which

were submitted to the probation officer before sentencing

, Christensen complained that one of the victim impact
statements wa s “m isleading .” He did not provide specifics, and he did not otherwise o bject t o the content of any of the victim impact statements quoted in the PSR. After the probation officer a mended the PSR i n r esponse to Christensen’s informal objections, Christensen did not ag ain complain about the victim impact statements.

One day before sentencing w a s s ch eduled to beg in, the district court advised counsel that—for “ a number o f reasons”—it was considering a n upwar d v ariance to Christensen’s sentence. To that end, t h e d istrict judg e requested that the g o v e rnment provide information concerning the amount o f investor monies t hat Christensen diverted to his own personal use. Given the las t

- m i n u te notice concerning a possible upward variance, Christensen’s counsel requested and obtained a c ont i n u ance of the sentencing hearing

.

As directed b y the district court, the g overnm en t filed a spreadsheet itemiz ing Christensen’s u se of $507,805 for personal ex penses. Among o ther things, the spreadsheet revealed t h a t Christensen u sed investor monies for personal investment properties held in h is wife’s name, to pay his more-than-$13,000-per-month h ome m ortg ag e, to make
pay ments to his ex -wife, to make a ca r pay ment for his daug hter, to pay h is daug hter’s colleg e tuition, and to g ambleU N I T E D S T A T E S V

. C H R I S T E N S E N 6

a t a casino in B ilox i, Mississippi. According to the F B I
, $507,805 was a “ conservative fig ure” for the amount o f diverted funds used for Christensen’s personal ex penses.

Christensen d id not contest the a ccuracy of the personalu s e transactions listed in the g overnment’s spreadsheet. Christensen instead arg u ed—both in a w ritten sentencing memorandum and in open co urt at sentencing —that an upward variance based on his p ersonal use of diverted funds would constitute improper double-counting because the total lo s s amount—$985,994—had already resulted in a 14-level increase in Christense n ’ s offense level pursuant to U.S.S.G. § 2B 1.1(b)(1)(H). The district court w as unpersuaded b y Christensen’s double-counting arg ument.

At the first of two sentencing hearing s, the distri c t c o u rt overruled Christensen’s informal objections to the PSR and,

on the r ecord, adopted the finding s i n the amended PSR, determining them to be “ true and c orrect as mod i f i e d

. ” I ncluded in the finding s adopted by the d istrict court was the total loss—$985,994—resultin g from Christensen’s criminal offense. Althoug h a number of Christensen’s victims spoke
at that f irst hearing

, Chri s t e nsen failed to call the district court’s attention to any f alse or misleading informati o n provided by t hose victims. 1 I ndeed, Christensen offered no objection at all to the victims’ statements.

1 Ch risten sen did o b

j ect to th e g o v ern m en t ’ s read in g o f a “ v ictim im p act statem en t” f

ro m W .H. Meh r. Ch risten sen n o ted f o r th e reco rd th at Meh r

w as n o t, i n f

act, l isted as a “ v i ctim .” T h e d istrict co u rt resp o n d ed to th e

o b j ectio n b y statin g : “ So n o ted .” Meh r’ s in v estm en t—$ 1 2 8 ,5 7 1 .4 2 —w as

n o t in clu d ed in t h e $ 9 8 5,9 9 4 lo ss attrib u ted to Ch risten sen ’ s crim in al

co n d u ct.U N I T E D S T A T E S V

. C H R I S T E N S E N 7

At the second sentencing hearing

, after hearing from both counsel and Christensen himself, the d istrict court ex p lained its reasons for an upward variance as follows:

T he sentencing factors r equire the Court to impose a sentence that i s sufficient, but not g reater than necessary to comply with the
purposes set f

orth in 18 U .S.C. Section 3553(a)(2). And if the Court is g oing to vary , the Court has to state i t s reasons for vary ing upward.

And focusing on the nature a nd circumstances of the o f

f ense, and the nature

a n d c haracteristics of the defendant,

. . . i t

conce r n s t h e Court

. . . that in effect [ Christensen] used his posi t i o ns to influence innocent victims to invest at a time when he knew that he was not g oing to use the money for those purposes, without disclosing that to them. He diverted $985,994, which has been the ag reed upon s u m i n terms of loss in this

case.

After a dding that ( 1) Chr i stensen apparently learned nothing from a 28-y e ar-old f elon y c o n viction for obtaining
money by false pretenses an d ( 2) Christensen’s numerous victims included “vulnerable, r etirement ag e victims, v ictims that trusted Mr. Christensen,” the district court continued:

Mr. Christensen indicated that h e did not set out to bilk his investors. I accept that. Bu t , ag ain, that’s only half the story

. A t some point h e did conscio usly a nd intentionallyU N I T E D S T A T E S V

. C H R I S T E N S E N 8

d e c ide to bilk his investors, and that conduc t continued for a p eriod of y ears, and it involved a number of different investors in the same ty pe of conduct.

And I found interesting Mr. Christensen’s
statement to the Court in which h e ex plained, at least attempted to ex plain why he d id w hat he did. And he wr o t e in there that he’s the ty pe of person in which he b elie v e s that failure is not an option. I ’ve heard that phrase

over and over ag a in by many people. And in this case, it clearly was an option. I t’s clearly what y ou should have done. Y ou should have accepted failure. Sometimes y o u learn more fr o m y our failures than y ou do from y our

successes. B ut it certainly would have saved
not only y our family

, b u t al l of these v ictims who h ave made statements, s ubmitted loss

s tatements to the Court, f rom having t o p o s t p o n e t h e i r r e t i r e m e n t , h a v e t h ei r marriag es destro y e d, lose their jobs or lose their homes.

The Court believe s , therefore, for those

reason s , a n d specifically g iven the – as in Schlueter

, th e fact that I don’t think the

s e n t e n c i n g g u i d e l i n e r a n ge a d e q u a t e l y accounts for the harm that Mr

. C h ristensen’s fraud caused his victi m s , I believe that g iven the eg reg iousness of h i s conduct, including ly ing

, covering up, u s i n g funds for personal
purposes, destroy ing the victims’ liv e s, cheating victims out of sig nificant sums o fU N I T E D S T A T E S V

. C H R I S T E N S E N 9

money that they needed, and taking advantag e of personal relationships, that the g uideline
rang e doesn’t adequately account for the harm that his conduct has caused. There is a need

– despite the fact that there has been almost 2 8
y ears between his last conviction, there still is

a need I believe in this case to protect the public from further crimes.

F or all these reasons, the Court belie v e s

an u p ward variance is a

ppro p r iate and, g iven the loss i n t h is case, that a sentence of 60 months is appropr i ate a

n d sufficient, but not g reater than ne c e s s a ry t o satisfy the sentencing r e quirements imposed by the Court.

At the c onclusion o f the sentencing hearing , Christensen offered onl y two o bjections to the sentence imposed. Christensen first objected to the purp o r t ed lack o f notice
reg arding the basis for an upward variance. Specifically

, Christensen a sserted that he h ad not b een g iven notice that the
court mig ht b ase an upwa rd variance on the victims’
statements. H e did not assert that the district court committed procedural error b y r ely ing on clearly erroneous facts, speculative evidence, a

nd unreliable victim statements. Second, C h r istensen objected to the d istrict court’s alleg ed “discounting ” of his acceptance of responsibility

. He offered no other objections to the sentence imposed.U N I T E D S T A T E S V

. C H R I S T E N S E N 10

I I

.

A.

Christensen raises a number of issues, only two of which

were prope r l y preserved for appeal—namely

, whether the district court committed p rocedural error by imposing a nonGuidelines sentence based o n f actors already incorporated into the Guidelines and whether the district court improperly “discounted” Christensen’s a cceptance of responsibility

. W e find no merit to either issue.

W e review a sentence f or reasonableness; “only a procedurally erroneous or substantively unreasonable
sentence w ill b e set aside.” United S tates v. Carty
, 520 F .3d 984, 993 (9th Cir. 2008) (e n b a n c). “Procedural errors include, but a

re not limited to, incorrectly calculating the Guidelines r ang e, treating the Guidel ines as mandatory

, failing to properly consider the [ 18 U.S.C.] § 3553(a) factors, using clearly erroneous facts when calculating the Guidelines
rang e or determining the sentence, an d failing to provide an ad eq uate ex planation for the sentence imposed.” United States v. Armstead

, 5 5 2 F. 3 d 769, 776 (9th Cir. 2008). C h r i s t e n s e n h a s o n l y c h a l l e n g e d t h e p r o c e d u r a l reasonableness of his sentence.

W e review the district c o u rt’s construction a nd interpretation of the Guidelin e s de novo , United States v

. Nielsen

, 6 9 4 F

. 3d 1032, 1034 (9th Cir. 2012), and the district court’s application of the Guidelines for abuse of discretion, United States v. Holt

, 510 F

. 3d 1007, 1010 (9th Cir. 2007). W e review the district court’s factual determinations for clear

error. U nited St a t es v. Tulaner

, 512 F .3d 576, 578 (9th Cir. 2008).U N I T E D S T A T E S V

. C H R I S T E N S E N 11

W e r eview the f

irst o f Christensen’s p reserved i s sues—whether the district c o urt eng ag ed in impermissib l e double-counting

—for abuse of discretion. See Holt

, 5 10 F .3d
at 1010. As the F ifth Circuit correctly noted in U nited States

v. W illiams

, 5 17 F .3d 80 1 ( 5 th Cir. 2008), “[ t] he Supreme Court’s decision in [ United States v. Booker

, 543 U. S

. 2 20 (2005),] implicitly r ejected the position that n o a dditional weig ht could b e g iven to factors included in calculating the applicable ad v i s o ry Guidelines rang e, since to do otherwise would esse n tially render the Guidelines mandatory .” Id. at 809 (internal footnote omitted). “ This necessarily means that the sentencing court is free to conclude that the applicable Guidelines rang e g ives too much or too little weig ht to o ne o r

more factors

, either as applied in a p articular case o r as a matter of policy .” I

d

. H ere, when selecting a n above Guidelines sentence for Christensen, the district court w as not prohibited from c onsidering the ex tent to which the Guidelines did not sufficiently account f o r t he nature a

nd circumstances of Christensen’s offense, including the amount of the loss, the number of victims, o r the harm to the victims,

even thoug h the Guidelines account f o r these factors either implicitly or ex plicitly

, to some ex tent. T he district court did
not err by concluding that the Guid e lines did not properly take into account the harm caused b y “ the e g reg iousness o f [ Christensen’s] conduct, including ly ing , covering up, using funds for personal pu r

p oses, destroy ing the victims’ lives, cheating victims o u t o f sig nificant sums of money that they needed, and taking advantag e of personal relationships.” The district court’s conclusion is supported b y the r ecord a nd did not constitute impermissible double-counting

.

W e review Christensen’s second pres e rved issue— whether the district improperly d iscounted his acceptance o f responsibility

—for c lear e rror. United States v. Cor t es ,U N I T E D S T A T E S V

. C H R I S T E N S E N 12

299 F .3d 1030, 1037 ( 9 th Cir. 2 002). Christensen was, in fact, a w a

rded a 3-level reduction for acceptance o f responsibility ; the district court ex pressly denied that it discounted “in any way the f act that [ Christensen] accepted responsibility ;” and the record o therwise belies Christensen’s
sug g estion that the district court “turned his accep t a n ce o f responsibility on its h ead by using it as a justification for the upward variance.” To determine that the district court clearly erred, we must be “left with the definite and firm conviction that a mistake has been commi t t ed.” E asley v. Cromartie
, 532 U.S. 234, 242 (2001). Mere evidence that Christensen received a 3-level r eduction, but ended up with an above Guidelines sentence is insufficient, in this case, to l e ave us with a “definite and firm co n v i ction” that the district court erred. Rather, the d i strict court acknowledg e d that Christensen was entitled to an a cceptance of respon s ibility reduction and based the upward v a r i a n ce on Christensen’s b e h a vior wholly independent o f h is acts constituting acceptance of responsib i l ity

. W e h ave no b asis for questioning whether the d istrict court did

, b o t h in word a nd in f act, a ward Christensen a 3-level reduction for acceptance of responsibility

.

B

.

Christensen contends that the d istrict court committed procedural error by

, among other thing s, (1) failing to resolve factual conflicts in the PSR reg arding victim impact a nd loss
amounts a s r equired by F ederal Rule of Criminal P r ocedure 32(i)(3)(B ); (2) failing to provide advance notic e o f the precise g r ounds for the 19-month u pward varianc e in his
sentence in violation of the Due Process Clause; and (3) improperly relying on cle a r l y erroneous facts, speculative evidence, and unreliable victim statements, also in violationU N I T E D S T A T E S V

. C H R I S T E N S E N 13

of the Due Process C l a u se. B ecause Christensen failed to raise these alleg ed procedural e r rors before the district court,

we review for p lain error. United States v. Burgum
, 633 F .3d 810, 812 (9th Cir. 2011).

To secure reversal under the plain error s t a ndard, Christensen must show that: (1) there was error; (2) the error

was plain; and (3) the error affected Christensen’s substantial rig hts. United States v. Joseph

, 716 F .3d 1273, 1277 ( 9th Cir. 2013). “ I f these three c onditio n s [ a r e satisfied]

, [we] may

e x e rc i s e [our] discretion to n otice a forfeited error that

. . . seriously affects the fairness, integ rity

, or public reputation o f judicial p roceeding s.” Id. ( internal quotation marks omitted) (quoting United States v. Ameline

, 409 F .3d 1073, 1078 (9th Cir. 2 0 05) ( en banc)). A sentenci n g e r r or prejudices the

su b s tantial rig hts of a defendant when there is a reasonable
p r o b ability that he would have r eceived a different sente n c e had the di s t ri ct court not erred. Id. at 1280. The defendant bears the burden of showing a reasonable probability that he would h a ve received a d ifferent sentence absent the error. Id.

W h en a defenda n t fails to make specific alleg ations o f factual inaccuracy in a PSR, a district c ourt has no oblig ation under Rule 32(i)(3)(B ). United S tates v. Petri
, No. 11-30337, 2013 W L 1490604, a t *7 (9th Cir. Apr. 12, 2 0 1 3 )

. B ecause Christensen never made specific factual objections to the PSR
reg arding victim impact and loss amounts, Rule 32 was never trig g ered. I

d. W e find that the district court com m i t t e d no error, much less plain error, under Rule 32(i)(3)(B ).

W e l i k e w ise find that the district court c ommitted no

err o r, much less plain error, by failing to provide advance notice of the precise g ro unds upon which the the 19-month upward v ariance to Christensen’s sentence was based. AU N I T E D S T A T E S V

. C H R I S T E N S E N 14

district c ourt is not required—either by the F e deral Rules o f Criminal Pro c e d u r e o r by the Due Process Clause—to g ive advance notice of its intent to impose a sentence outside the advisory G uidelines rang e. I rizarry v. United Sta t e s , 5 53 U.S. 708, 713–16 (2008). I t follows that, if a distr i ct court is n ot required t o g ive advance n o tice o f its intent to vary upward, it is also not r equired to g ive advance notice o f the precise g rounds upon w hich it mig ht base a n upward variance.

To the ex tent Christensen complains, in g eneral, that the d i s t r i c t c o u r t e r r e d b y t a k i n g i n t o a c c o u n t t h e “uncorroborated,” “unsworn,” and “ untested” statements o f victims, his c laim of error is without merit

. The F ederal Rules of Evidence do not a pply at a sentencing hearing

. F ed. R. Evid. 1 101(d)(3). I ndee d

, “ a sentencing judg e may appropriately conduct an inquiry b road in scope, larg ely unlimited either as to the kind of informatio n h e may consider, or the source from which it may come.” Nichols v

. United States
, 511 U.S. 7 38, 747 (1994) ( i n ternal quotation marks omitted). B y statute, there is “[ n] o limitati o n

. . . on the information concerning the backg round

, character, a nd conduct o f a person convicted o f an offense which a court o f the U nited States may receive and consider for the purpose o f imposing an appropriate sentence. ” 1 8 U .S.C. § 3661. The F ederal Rules of Criminal Procedure, moreover, provide that the presentence repo r

t must contain “information that

assesses any financial, social, p sy cholog ical, and medical impact on an y v ictim.” F ed. R. Crim. P. 32(d)(2)(B ). As a g eneral matter, then, a dist r i c t court may consider victim impact statements, w hether sworn or not, at sentencing

. Uni t e d States v. Santana
, 908 F .2d 506, 507 (9th Cir. 1 990) (per curiam).U N I T E D S T A T E S V

. C H R I S T E N S E N 15

To the ex tent Christensen complains that the district court procedurally erred and his d ue process rig hts were violated b y the dis t ri ct c ourt’s purported reliance on “erroneous facts” provided by the v ictim s , we are presented with a closer
que stion. Specifically

, Christensen points to statements made by the district c ourt at sentencing reg arding victim losses a nd impacts. The district court referred, f or ex ample, to the
statement of o ne v ictim (J ennifer R.) who said she invested her entire life saving s ($330,000) in one of Chri s t e nsen’s projects, o nly to lose it all and her 19-y ear marriag e to boot. I n the PSR, that particular victim’s loss—or, more precisely

, the portion of her o verall investment that w as a ttributed to Christensen’s diversion of investor funds ($90,000) that was lost—was reported to be only $ 23,017. The d istrict court noted that another investor h a d been unable to retire a s planned, althoug h the PSR stated th a t the portion of that

v i c t i m ’ s o v e r a l l i n v e s t m e n t t h a t w a s s u b j e c t t o misappropriation ($20,000) only r esulted in a loss of $5,496. The district court also referred to the stateme n t o f another individual ( W

. H. Mehr), who said that he would n o t have invested h is “$128,000 p lus dollars” had C h r i stensen been truthful with him. Mehr was not l i s t ed as a “victim” in the PSR at all, a

nd his losses were not included in the $985,994 loss fig ure r e p o rted in the PSR, apparently because his investment dollars were not d iverted by Christensen. F inally

, the district court repeated the claims of var i o u s v ictims
reg arding the impacts they s uffered—foreg one vacations, delay ed retirement, a ruined marriag e, sale of t h e family homes, lost saving s—without separatin g ( perhaps an impossible task) the impacts a t tributable to Christensen’s criminal behavior from the impacts attributable t o noncriminal investment losses.U N I T E D S T A T E S V

. C H R I S T E N S E N 16

Christensen b ears the burden of showing that the district
court relied on clearly erroneous fa c t s , affecting his substantial rig hts, w hen either (1) calculating the Guidelines
rang e or (2) determining h i s sentence. See Armstead

, 552 F .3d at 776. Christensen does not arg ue that the district
court relied on any cle arly erroneous fact in calculating the Guidelines rang e. I n f act, Christens e n a gr eed with the calculated Guide l i nes rang e, including the loss amount that the district court accepted, and r eiterated numerous times a s the b asis for the loss calculation in the case, in arriving at that calculation—$985,994. Thus, t h e only question is whether the d istrict court relied on any clearly erron e o u s f act in determining the sentence. Ag ain, to find clear e rror, we must be “left with the definite a nd f irm conviction that a mistake h a s b e en c ommitted.” Easley

, 532 U .S. at 242. W e are l ef t with no such c onviction that a mistake has been committed in this case.

I t is c lear that, at sentencing

, the district court ex pressly adopted the finding s r eported in the PSR, including the $985,994 loss suffered by Christensen’s “vict i m s.” During its recitation of reasons for vary ing upward, moreover, the district court ex p ressly st a t e d that (1) Christensen “diverted $ 9 8 5
, 9 9 4
, which h as been the ag r e e d upon sum in terms o f loss in this c ase;” (2) “this c ase

. . . involved almost a million dollars;” and (3) “th e C o u r t believes an upward v ariance is

a ppropriate

. . . g iven the loss in this case.” I t t h u s s e e m s clear that the district court based it s variance on “the ag reed
upon sum in terms of loss in this case,” a sum— $985,994—that included only victim losses a ttributable to Christensen’s criminal conduct.

I n addition to ex plaining that the up w a rd variance was based on “ the ag reed upon sum in terms of loss in this case,”U N I T E D S T A T E S V

. C H R I S T E N S E N 17

the district c ourt iterated the following additional reasons for its upward v a r i a nce: (1) Christensen took advantag e o f personal relationships to solicit larg e sums of investm ent monies f rom p eople who trusted him; (2) Christense n u sed

over $500,000 of investor monies t o e n r ich himself—to invest in properties held in his wife’s name, to pay his home

m o r t gag e, to make pay

ments to his ex -wife, to pay hi s daug hter’s colleg e tuition, and to g a mble at a casino in B ilox i, Mississippi; (3) Christensen repeatedly and continually lied
to his victims, not only about the true state of p roject affairs but also about the uses to which he w a s p u tting their investment dollars, enabling him to keep his u nlawful scheme
g oing for a p eriod of y ears; (4) Christensen’s unlawful scheme caused his victims to lose sums of money they could ill afford to lose; and (5) Christensen app a rently learned nothing from a 28-y ear-old unscored conviction for obtaining
money by false pretenses. Christensen d id not a n d d o e s not dispute the factual basis f or the above reasons iterated by the district court. Each of those reasons, moreover, c onstitutes a proper sentencing factor under 18 U .S.C. § 3553 ( a ), a nd tog ether they provide sufficient support f or the d istrict court’s decision to vary

upward.

The d istrict court included another r eason for the upward variance w hen it referred to the “life-destroy ing impacts” described by

Christensen’s victims. As noted by the district court, these victim-reported impacts included loss of homes,

a failed marriag e, postponement of r etirement, foreg o ne vacations, loss of life-sav i ng s, and loss of the ability to pay for child r e n’s private schooling

. The victims reported the impacts they suffered from having lost all of their investment dollars, without diffe rentiating losses that were solely attributable to Christens e n ’ s diversion of investor f unds. T h e s e “ l i f e

- d e stroy ing impacts” undoubtedly went bey ond t h eU N I T E D S T A T E S V

. C H R I S T E N S E N 18

stipulated losses to i n v e s t o r s b a s e d on Christensen’s diversion of funds.

These “life-destroy

ing im p a cts,” however, were proper for the district court to consider even i f n o t tied to the loss Christense n c aused by misappropriating investor f unds. There is “[ n] o l i m i t at i on

. . . on the information concerning the backg round, character, and conduct of a person convicted of an offense which a c ourt

. . . may receive a nd consider for the p u rpose of imposing an appropriate sentence.” 2 1 8 U .S.C. § 3661; see also Pepper v. U nited States
, 131 S

. C t

. 1229, 1240 (2011) (“Permitting sentencing courts to co nsider the widest possible bread t h of information about a defendant

2 Desp i te th is p lain an d ca p a c i o u s lan g u ag e, th e d issen t in sists th at in f o rm atio n co n sid ered u n d er 18 U.S.C. § 3 6 6 1 m u st b e crim in al in

n atu re. S ee Dis. Op

. at 3 1

– 3 4

. W e disag ree. T h e Su p rem e C o u rt “ [h as]

reco g n ized th at ‘ t

h e b ro a d l a n g u ag e o f § 3 6 6 1’ d o es n o t p ro v id e ‘ an y b asis f or th e co u rts to in v en t a b lan k et pro h ib i tio n ag ain st co n sid erin g certain ty p es o f ev id en ce at sen ten cin g .’ ” Pep p er v. Un ite d Sta tes , 1 3 1 S. Ct. 1 2 2 9
, 1 2 4 1 (2 0 1 1 ) (q u o tin g U n ited S ta tes v. Wa tts , 5 1 9 U .S. 1 4 8
, 1 5 2 (1 99 7 )). T h eref ore, su b j ect t o co n stitu

tio n al co n strain ts, see id

. at 1 2 4 0 n .8
, w e tak e Co n g ress at its w o rd : a sen t en cin g co u rt m ay rely on

an y ev id en ce relatin g to a d ef en d an t’ s b ack g ro u n d

, ch aracter, an d co n d u ct

w h en c o n s i d erin g th e sen ten cin g f acto rs f o u n d in 1 8 U.S.C. § 3 5 5 3 (a). S ee Pep p er , 1 3 1 S. Ct. at 1 2 3 6 (h o l d in g th at a sen ten cin g co u rt m ay

co n sid er p ost- sen ten cin g reh ab ilitatio n ).

Ou r d ecisio n in Un ited Sta tes v

. Merca d o , 4 7 4 F.3 d 6 5 4 (9 t

h Cir. 2 0 0 7 ), cited b y th e d issen t , do es n o t alter th is co n clu sio n

. S ee Dis. Op

. at 3 4 n .5

. In Merca d

o , th e d istrict co u rt co n sid e r e d th e crim in al activ ity ch arg ed in sev eral acq u itted co u n ts w h en it sen t en ced th e d ef

en d an t o n th e

co u n ts f o r w h i c h h e w as co n v icted

. 4 7 4 F.3 d at 6 5 5

– 56

. We af f irm ed

, h o ld in g th at “ th e d istrict co u rt co u l d co n stitu tio n ally co n sid er th e acq u itted co n d u ct.” Id

. at 65 7

. T h u s, alth o u g h M erca d o estab lish es th at

a d istrict co u rt ma

y co n sid er acq u itted co n d u ct, it d o es n o t su g g est th at in f o rm atio n co n sid ered u n d er § 3 6 6 1 mu st b e crim in al in n atu

re.U N I T E D S T A T E S V

. C H R I S T E N S E N 19

‘ensures that the punishment will suit not merely the offense b u t the individual defendant.’”) (quoting W a sman v

. Unit e d S t ates , 468 U .S. 559, 564 (1984)). These “life-destroy i n g impacts,” supported by victim statements, provide g reater ins ig h t into Christensen’s “backg round, character, a nd conduct” that the d ist r ict court w as entitled to rely o n in determining that for a specified loss resulting from criminal conduct, the G uidelines did not adequately account f o r t he seriousness o f Christensen’s of fense, provide adequate deterrence

, o r sufficiently protect the public and innocent investors from the infliction of further harm at t h e h ands o f Christensen. 3 See 18 U.S.C. § 3553(a)(2). Moreover, it was not the d ollar amount of these victims’ losses that the district
court relied o n i n imposing this u pward variance; r a ther, it

was the intang ible nature of Christensen’s conduct. A s t he district court stated:

I believe that g iven t h e egreg iousness o f his conduct, including ly in g , covering up, using fund s f or personal purposes, destroy ing the victims’ lives, cheating v ictims out o f sig nificant sums of m oney that they n e eded,

a n d t a k i n g a d v a n t a g e o f p e r s o n a l relationships, that the g uideline r ang e doesn’t adequately account for the harm that h i s conduct has c aused. T here is a need—despite the fact that there h a s been almost 28 y ears

3 T h e d i ssen t w orries th at o u r h old in g m ig h t allo w sen ten cin g co u rts to

v ary u p w ard b ased o n “ th e trad itio n or sch o o l o f y o g a [a d ef en d an t] f av o rs.” Dis. Op

. at 3 4

. Of co u rse, th is f an cif u l s cen ario is n o t b ef

ore u s. T h e q u estio n p resen ted h ere is m u ch easier: Do es 1 8 U

. S

. C

. § 3 6 6 1

au th orize a sen ten cin g co u rt to co n sid er lif e- d estro y in g im

p acts th at f

lo w d irectly f ro m a s u b s t a n t ially crim in al sch em e? A s ex p lain ed ab o v e, th e

an sw er is “ y es.”U N I T E D S T A T E S V

. C H R I S T E N S E N 20

between his last conviction, the r e still is a need I believe in this c ase to protect the public from further crimes.

I n a d d i t i o n, we note that many of the “life destroy ing impacts” were indivisibl e

. F o r e x ample, J ennifer R.

a ttributed the d issolution o f her 19-y ear marriag e t o Christensen’s conduct. T h e d issent arg ues that it was in a p p r o p riate for the d istrict court to consider this divorce because the PSR indicates that J ennifer R. lost only $23,017 due to Christensen’s fraud. Dis. Op. a t 27–29. I n s o doing

, the dissent a ssumes J ennifer R. ’ s divorce was a matter o f simple arithmetic: it resulted from the loss of a certain sum o f
money , and that sum must h a ve been g reater than $23,017; therefore, because J ennifer R. lost o nly $23,017, the district
court was r equired to ig nore her cl a i m that Christensen’s conduct had caused her divorce. T his argu m e n t ig nores the indivisible nature of the harm. The fact of the matter is that

we do not k

now h ow much financial stress J ennif e r R

. ’s marriag e could have w ithstood. What we d o know i s that J ennifer R. and her husband entruste d t h e i r life saving s to Christensen, that he fraudulently diverted a portion of it, that their marriag e n ever recovered from the stress, a nd that neither the causes nor the impacts o f a divorce break down neatly into d o l l a r s and cents. This is precisely the ty pe o f situation in which th e G uidelines do not adequately account for the seriousness of the offense. As a result, it was proper for the district court to consider J ennifer R.’ s d i vorce, tog ether with the other “ life destroy ing impacts” d escribed b y Christensen’s victims.

I f the district court had used n o n -offense “losses” to erroneously calculate the Guidelines range , this would be a much different case. B ut, where a s here, the district courtU N I T E D S T A T E S V

. C H R I S T E N S E N 21

u s e d the correct loss calculation to arrive a t the correc t Guidelines rang e, and appears to have only r elied on e x trinsic evidence a s support for the Guidelines inadequate accounting f o r the harm caused by Christensen, we cannot say that t h e district court clearly erred in any manner. Therefore, we conclude that the dist ri ct c o urt committed no error in this
reg ard.

Even assuming that the district court did err, Christensen has fallen short of establishing that his substantial rig hts were affected by any such error. I ndeed, while the record provides

a m ple support f

or the district c ourt’s 19-month upwa r d variance, the record provides no basis for co n c l u ding that there is a reasonable pr o b a bility Christensen would have received a more lenient sentence absent the asserted error.

At the conclusion of the sentencing hearing

, the district
court ex pressly stated that it was “imposing a sente n c e that

was less than what I think the Court could h ave imposed
g iven the eg reg iousness of the conduct in this case,” conduct which—in effect—amounted to stealing over a long period o f time from people whose trust Chri s tensen maintained throug h lies. The d istrict court also stated that “[ t] his could have been

a sentence that was far g reater than 60 months.” T he district
court said nothing to sug g est tha t i t would have imposed a lesser sentence if the overstate d i m p acts of Christensen’s
eg reg ious criminal conduct had not been considered. At b est, it is hig hly uncertain whethe r Christensen would have received a le s s er s entence if the d istrict court had not considered th o s e i mpacts, and such a hig h deg ree o f uncertainty precludes a finding that a ny alleg ed e rror affected his substantial rig h ts. S

ee Jones v

. Unite d S t a t e s , 527 U.S. 373, 394–95 ( 1999) (“W here the effect of an a lleg ed e rror is

so uncertain, a defendant cannot meet his burden of showingU N I T E D S T A T E S V

. C H R I S T E N S E N 22

that the error actua lly a f

fected h is substantial rig hts.”); see also United States v. Gonzalez-Aguilar

, 718 F .3d 1 185, 1189 (9th Cir. 2013) (ex p laining that a defendant cannot meet the third p rong of the p lain err o r test b y demonstrating a mere “possibility ” that he cou l d h ave obtained a lesser sentence absent the a l leg ed error); United States v

. Rodriguez

, 627 F

. 3d 1372, 1382 (11th Cir. 2010) (ex plaining that “where the effec t o f an error on the result in the district c ourt is uncertain o r indeterminate—whe r e we would h ave to speculate—the appellant has n o t m et his burden of showing

a reasonable probability of a different result” (internal quotation marks o mitted)); United States v

. L o r enzo , 9 9 5 F .2d 1 4 4 8
, 1 457 n.4 (9th Cir. 1 993) (noting that “if plain error analy sis applies, it appears that the appellan t s

. . . pay the price for the inad e q u a c y of the record”). Thus, even assuming error, it did not affect Christensen’s sub stantial rig hts.

L ikewise, Christensen’s due process arg ument is unavailing

. The Due Process Clause requires that a defendant
not b e sentenced on the basis of “misinformation o f constitutional mag nitude.” United States v. Tucker

, 404 U.S. 443, 447 (1972). To establish that his due process rig hts were violated, Christensen must show that materially false o r unreliable information was demonstrably made the basis for the s e n t e n c e imposed by the district court. United S tates v

. McGowan
, 668 F .3d 601, 606 ( 9th Cir. 2012). Here, because Christensen failed to raise his “ erroneous facts” issue before the district court, Christensen must show not only that the district c ourt committed error under the Due Process Clause but a l s o that the error a ffected his substantial rig hts. As we have shown, Christensen cannot satisfy this burden.U N I T E D S T A T E S V

. C H R I S T E N S E N 23

I I I

. Having found n o merit to any of the issues r ai s ed b y Christensen, we AF F IRM

.

TASHI MA, Circuit J udg e, dissenting :

W e review a district court’s sentencing d e c i s ions for abuse of d iscretion, thus affording district courts a substantial deg ree o f deference

. Bu t , as we recently observed en banc, “[ t] he abuse of discretion st a n d ard is deferential, but it does
not mean any

thing g oes.” U

nited States v. Ressam
, 679 F .3d 1069, 1087 (9th Cir. 2012) ( e n banc). And, as the Supreme Court has observed in a related contex t, w e s h o u ld “ not indulg e [ in] post hoc r ationaliz ation” of the se n t e n cing

c o urt’s “decisionmaking that contradicts the available evidence

. . . .” Harrington v. Richter

, 131 S. Ct. 770, 790 (2011). I n short, “[ t] he abuse of discretion standard of r eview is not a r ubber stamp of all sentencing decisions m a d e by a district court, United States v. Ruff , 535 F .3d 999, 1 005 (9th Cir. 2 008) (Gould, J

. , dissenting ), and we s hould not turn a blind e y e when a district court distorts the sentencing process. B ecause that i s p recisely what the majority does, I respectfully

dissent.

I n a ffirming the sentence in the present case, the majority obfuscates a fact that is apparent from any fair reading of the record: the district court based its above-g uidelines sentence

on inve s tor losses n ot caused by Christensen’s criminal conduct.U N I T E D S T A T E S V

. C H R I S T E N S E N 24

This was “ sig nificant procedural error.” United States v

. Carty
, 520 F .3d 984, 993 (9th Cir. 2008) (en b a n c)

. The distric t c o u r t e ither mistakenly believed that the losses in question did r esult from Chr i s t ensen’s criminal conduct, in which case the sentence was p redicated o n “clearly erroneous facts,” id. (internal quotation marks omitted), or it knowing ly increased the sentence based o n the impact of non-c ri m i n al conduct, a p r oposition that not e v en the g overnment contends would be justified. B ecause v ictim impact formed the c entral basis for the upward varia nce, there is a “reasonable probability ” that the district c ourt’s error affected the

o u t c o me of the proceeding s. U nited States v. W

h itne y , 6 7 3 F .3d 965, 972 (9th Cir. 2012) (internal quotation marks omitted). F o r th e s e reasons, I believe Christensen has demonstrated plain error entitling him to relief.

I.

As an initial matter, it is necessary to clarify the nature o f the victims and their losses in this c a s e

. The presentence investig ation report ( “PSR”) identif i e d fourteen victims o f Christensen’s criminal conduct. The PSR ex plained the basis on which this determination was made:

The v ictims of th i s offense a re the numerous individuals who invested m oney into the various proje c ts the defendant manag ed a nd who had their investm e n t funds diverted for other uses which they did n ot authoriz e. I t is noted v ictim statement s were received f rom other individuals who l ost investment funds due to the f

ailure of all of Christensen’s projects. As their funds w ere properly invested into the p rojects they desig nated a ndU N I T E D S T A T E S V

. C H R I S T E N S E N 25

were not diverted, they are not victims for the purposes of this criminal matter.

Consistent with this a p p r o a c h, for each of the f ourteen vic t i ms, the PSR separately listed the amount of money invested with Christensen, and the portion of that investment fraudulently diverted and lost as a result of the c ri m i n al conduct. Across the fourtee n v i c tims, the total amount o f
money lost due to Christensen’s fraud was $985,994, representing less than h a lf o f t h e more than $2.1 million invested by

these individuals.

T h e district court accepted the PSR’s calculation o f $985,994 as “the ag r eed upon sum i n t e r m s of loss in this case.” I ndeed, this was the fig u re employ ed in calcul a t i ng Christensen’s a dvisory g uidelines sentenci n g r ang e and was the amount of restitution that Chris t e n s en was eventually ordered to pay

. As d escribed below, h o wever, the district
court disreg arded the PSR’s methodolog y i n assessing the i m p a ct of Christensen’s conduct on individual victims, conflating losses suffered due to the fraud and losses suffered from leg itimate ( i.e. , non-criminal), but failed investments.

II.

Althoug h one w ould n ever know it from the majority opinion

, t h e district court b ased its upward variance on the impact o f C h r i stensen’s conduct on individual investors, specifically five victims identified i n the PSR and o ne investor who was not a victim at all. This is abundantly clear from the record.

At the outset of ex plaining the basis for its sentence, the district court stated that it had “researched a number of cases”U N I T E D S T A T E S V

. C H R I S T E N S E N 26

in w h ich sentencing courts had v a r ied upward “under similar circumstance s .” The district court then described in detail
t hree out-of-circuit cases that it considered particula r l y analog ous, all involving defendants convicted of finan cial fraud who received above-g uidelines sentences on the basis of victim impact. The d istrict court characteriz ed the final

case it discussed, U

n i t e d States v. S

chlueter

, 634 F

. 3d 965 (7th Cir. 2011), as the “most instructive.” 1 A ccording to the district court, the upward variance in S chlueter was imposed (and affirmed) because “th e g uideline rang e failed to adequately account for the harm that [ the defendant’s] fraud h a d c a u sed h is victims or for the eg reg iousness of h i s conduct.” T h e victims in Schlueter were friends of the defendant, many of retirement ag e, and, in the district court’s words, the d efendant “[ took ] advantag e of personal relationships to cheat them out of sig n ificant sums that they needed at critical stag es of their lives,” including “one victim [ who] was unable to purchase a home because of the fraud.”

After recounting the details of S chlueter

, the district court

ex p lained that it “went back to the victim impact statements and the presentence report to compare, in effect, Mr. Christensen to the defendant in Schlueter .” I t w as at this point that the dist r i c t c ourt d escribed the alleg ed impact o f Christensen’s conduct o n six specific investors. The district
court p refaced this discussion by stating that it was “looking at the victims’ losses [ and] statements.”

1 T h e oth er tw o cases w ere U n i ted S ta tes v. S i ma n , 4 19 F. A p p ’ x 9 7 9 (1 1 th Cir. 2 0 1 1 ), an d Un ited S ta t es v. Sch errer , 4 4 4 F. 3 d 9 1 (1 st Cir. 2 0 0 6 ). T h e d is t r i c t co u rt ch aracterized Sima n as a case w h ere th e

sen ten cin g co u

rt v aried u pw ard “ rely i n g o n th e im

p act ex p erien ced b y th e

v ictim s an d w

h o th e v ictim s w ere.” Sim i larly

, th e d istrict co u rt d escrib ed S ch errer as a case w

h ere th e sen ten cin g co u rt “ f o cu s[ed ] o n th e v ictim s ” in im p o sin g a v arian ce.U N I T E D S T A T E S V

. C H R I S T E N S E N 27

F or at least three o f the six investors, however, the district
court c onsid e r e d the impact of losses well bey o nd those caused by Christensen’s criminal conduct. F or instance, the district court described Robert G. as a victim who “has been unable to retire

. . . as planned; he’s h ad to continue to work.” Yet, according to the PSR, Robert G. only lost $5,496 due to the fraud. I t is unlikely that this n arrow loss w as the cause o f Robert G.’s inability to retire, e specially g iven that Christensen repaid all but $192 of that loss more t h a n two
y ears prior to the sentencing hearing

.

The district court also discussed an investor named Mehr, who apparently lost $ 1 2 8
, 000 throug h investing in one o f Christensen’s projects. T he district court noted Mehr’s
statement that “if h e had known and been told the trut h

, he obviously w ould not have invested in the project.” B ut Mehr is not listed in the PSR as a victim

. R a t h e r, as the
g overnment concedes, he is one o f the investors not included in the PSR because his funds were properly invested a nd not diverted.

F i n a l l y , and most importantly

, is J ennifer R., whom the district court d escribed as “ the victim that concerns me the most.” J ennifer R. submitted a letter to the probation officer indicating that she lost $330,000 of her life saving s from investing with Christensen, w hich led to the disinteg r ation o f her marriag e. The PSR, however, lists J ennifer R. as h aving lost only $ 23,017 due to Christensen’s fraud. 2 Nevertheless,

2 T h e P S R l i s t s J e n n i f

er R. as h av i n g in v ested a to tal $ 9 0 ,0 0 0 w i th Ch risten sen

. It is n o t en t irely clear w h y th ere is a d i s crep an cy b etw een t h i s am o u n t an d th e $ 3 3 0,0 0 0 d escrib ed in h er letter to th e p r o b a t i o n

o f f icer, alth o u g h it m ay b e th at th e ad d itio n al f u n d s w ere i n v ested in
p ro j ects f ro m w h ich Ch risten sen did n o t f

rau d u len tly div ert an y f

u n d s (an dU N I T E D S T A T E S V

. C H R I S T E N S E N 28

in w eig hing the impact of Christensen’s conduct, the district court described J ennifer R.’s ex perience as follows:

She invested $330,000 of her life saving s, her

a n d her husband’s, which they had saved fo r 17 y e ars. This was going to b e their retirement. T hey were i n v i t ed to Mr. Christensen’s home. He befriended them, he talked them into i n v esting and, as a result, they lost t h e entire a mount of their life saving s. And her mar r i a ge , as she w rites, could not handle the loss. So not only did she lose her entire life savings

, her 19-y e ar marriag e has en d e d as a result of the defendant’s criminal behavior.

(Emphasis added.)

F or all three of these investors ( and likely two more o f the remaining three), 3 it is evident that the district c ourt based its analy si s on losses unrelated to Christensen’s criminal

c o n duct. These losses may have been caused b y

th eref o re w ere n o t in clu d ed t h e P S R’s calcu latio n s). In an y ev en t , th e relev an t co m

p ariso n is th e $ 2 3,0 1 7 l o s s estab lish ed b y th e P S R an d th e $ 3 3 0 ,0 0 0 f

ig u re o n w h ich th e d istrict co u

rt ex p ressly

relied

.

3 Fo r tw o of th e oth er t

h ree v ictim s d iscu ssed

, W illiam K. an d J am es D., th ere w as also a sizeab le g ap b etw een th e am o u n t in v ested an d th e am o u n t lo st d u e t o th e f

rau d (an o v er $ 9 0
, 0 0 0 d i f f eren ce f o r W i lliam K. an d a $ 5 1 ,0 00 dif

f eren ce f o r J am es D .). T h e d istrict co u r t d i d n o t m en tio n sp ecif ic d ollar a m o u n ts lo st b y th ese tw o in v esto rs, b u t its discu ssio n ag ain su g g ested th at it w as co n sid erin g t o t a l in v estm en t lo ss, n o t lo ss

cau sed b y th e f

rau d

. Fo r o n ly o n e o f th e s i x in v esto rs, T w ila K., w as th e

am o u n t in v ested t h e s a m e a s th e am o u n t lo st as a resu lt o f th e crim in al

co n d u ct.U N I T E D S T A T E S V

. C H R I S T E N S E N 29

C hristensen’s poor, but non-criminal, manag e ment, t h e victims’ p o o r judg ment in investing with him, the deterioration of the economy , o r some combination thereof. None of these are reasons why Christensen was c onvicted o f a crime.

The district court’s consi d e ration of these losses can be

ex p lained in only one of two way s: (1) it mistakenly believed that the full investment losses were attributable to the fraud;

or (2) it realiz ed that just a portion of the losses resulted from the fraud, but i t nonetheless knowing ly b ased its upward variance on the impact of non-criminal c onduct. F or reasons d e s c r i bed b e l o w , t h e r e c o rd s u p p o r t s t h e f o r m e r interpretation, but under ei t h er scenario, the district court committed sig nificant procedural error.

III.

I f the district court operated u nder t h e e rroneous belief that the full losses of Robert G., Mehr, and J ennifer R. were attributable to Christensen’s crimes, there can be little dispute that the sentence was predicated on “clearly erroneous f acts.” Carty
, 520 F .3d at 99 3 ( q u oting Gall v. United States
, 552 U.S. 38, 51 (2007)). I ndeed, t h e go vernment has never contested the accuracy o f the PSR’s loss cal c ulations for these investors. The district court’s statements a t sentencing make p lain that it did pr oceed under this incorrect assumption.

As described, the district c o u rt immediately led into its discussion of the six investors by stating that it was “looking
at the victims’ losses.” Then, with reg ard to J e nnifer R., the

m o st important victim in the district court’s calculus, the district court stated that she lost her entire life s a v i n gs o fU N I T E D S T A T E S V

. C H R I S T E N S E N 30

$330,000, as well a s her 19-y ear marriag e, “ as a result of the defendant’s c r i minal behavior .” (Emphasis added.) The d i s t rict court could not h ave made a more d irect statem e n t indicating t h at it was treating and r ely ing on full investment losses (including non-cr i m i n al losses) as attributable to Christensen’s criminal activities.

Nearly as compelling an indication is the district c o urt’s

re f e rence to Mehr, who w as not a victim at all. The district court’s disc ussion of the six investors, including Mehr, followed its long description o f the purportedl y a n alog ous

cases in which sentencing court s h a d varied u pward on the basis of victim impact. I n fact, t h e d istrict court used the word “victim” ten times in the three pag es of the sentencing transcript preceding its d iscussion o f t h ese investors. I t is inconceivable that the district c ourt deemed it r el e v a n t to discuss Mehr’s losses in this contex t while full y c o g niz ant that Mehr was not a victim.

The majori t y offers no refutation of this evidence in holding that the d istrict court did not p remise its sentence on clearly erroneous facts. I nstead

, t he majority attempts to elide the factual basis underly ing the upw ard variance b y pointing to two passing references that the district court made, later in the sentencing hearing

, to the PSR’s ag g reg ate loss c alculation of $985,994. M aj

. O p

. at 16. F rom these references, the majority r easons that the distric t c o u rt surely predicated its variance o nly on losses caused by the fraud. Id

. at 16–17. This analy sis ig nores th e r e a l i t y that the district court’s variance was b ased not on ag g reg ate losses, but on the impact on individual victims. The district court emphasiz ed

a s much over and over at sentencing

. I n evaluating t h o s e individual victims, the d i s t r ict court relied on clearlyU N I T E D S T A T E S V

. C H R I S T E N S E N 31

e r r oneous f

acts, and it thereby committed sig nifica n t procedural error.

IV.

I f, o n the other hand, the d istrict court appreciated that the referenced investor l o sses w ere not attributable to Christensen’s crimes, this would necessarily mean t h a t the district c ourt intentionally rested its sentence, in part, on the impact of no n

- criminal conduct. O therwise, the district court’s ex tended discussion of the full investor losses would have been without purpose. At oral arg u ment, however, the
g overnment ex pressly disclaimed reliance on any notion that the district court could permissibly base its upward variance

on non-criminal conduct. Hence, if the majority is co rr e ct that the d istrict court did not rely on er r o n e o u s facts in misperceiving the nature o f the losses, t h e o n ly remaining possibility depends on an a rg ument that t h e g overnment wisely has elected not to pursue, and t h a t w e should not advance in its stead. See United States v. Anekwu , 695 F .3d 967, 985 (9th Cir. 2012) (arg uments not raised by parties a re waived).

Yet, because t h e majority has not clearly disavowed the possibility that the d istrict cou r t m ay have varied upward based on the impact o f non-criminal c o nduct, reluctantly

, I find it n ecessary to address that q uestion. I believe it must be answered in the neg ative. I n the analog ous contex t o f “relevant conduct” under U.S.S.G. § 1 B1

. 3
, used in calculating a d efendant’s g uidelines offense level, the Courts of Appeals a

re unanimous in holding that the provi s i o n is limited to conduct that is cr i m i n a l. See United States v

. Catchings

, 708 F .3d 710, 712, 7 20 (6th Cir. 2 013); U n i t ed S t a t es v. Griffith

, 584 F .3d 1004, 1013 (10th Cir. 20 0 9 ) ;U N I T E D S T A T E S V

. C H R I S T E N S E N 32

United States v. Sch a efer

, 291 F .3d 9 32, 940–41 (7th Cir. 2002); United States v

. D o ve , 247 F

. 3d 152, 155 (4th Cir. 2001); United States v. Jain
, 93 F .3d 436, 443 ( 8 th Cir. 1996); United States v. Peterson
, 101 F

. 3d 375, 385 (5th Cir. 1996); United States v. Dickler

, 64 F .3d 818, 830–31 (3d Cir. 1995). The reasoning b ehind this limitation applies e q ually here, i.e.
, to the b asis for a variance. To allow for an upward variance b ased on non-criminal co n d u ct “would allow individuals to b e p u n ished by having their [sentence] increased for activity which i s n ot prohibited by law but merely morally distasteful or viewed as simply w r ong by the sentencing court.” Peterson , 101 F .3d at 385.

The sentencing factors of 18 U.S.C. § 3553(a)(2) confirm this conclusion. W ith the ex ception of the rehabilitative g oals of clause (D), all of the fa ct o r s focus on the unlawful nature of the defendant’s past or future behavior. The f actors speak of the seriousness of “the offense,” the need to provide just punishment for “the offense,” the n eed t o deter “criminal conduct,” and the need to protect the p ublic from “further crimes. ” S

e e 18 U.S.C. § 3553(a)(2). The impact o f a defendant’s completed, non-criminal activities – in this c ase, losses caused by poor investment d ecisions

– is not relevant
to any of these inquir i es

. And g iven that sentencing courts must impose a sentence t hat is “sufficient, but n o t g reater than necessary to comply with the purposes ” o f the § 3553( a ) ( 2 ) factors, there is no place for increasing a defendant’s sentence on the basis of this considerat ion. Id. § 3553(a) (emphasis added).

The majority ’s response on this p oint is perplex ing

. The majority seems to concede that it would have been improper for the district court to vary upward based on the mag nitude

o f the losses caused b y Christensen’s non-criminal condu c t

.U N I T E D S T A T E S V

. C H R I S T E N S E N 33

I n other words, the majority seems to concede that the district
court would have erred in stating

, “I am vary ing upward because Christensen caused o ver $2.1 million in i n v estor losses, including over $1.1 million in losses not related to the fraud.” B ut the majority nonetheless c ontends that i t w a s

a p propriate to vary upward based on the “life-destroy ing impacts” of those same los s es. Maj. Op 18–19. This is a classic distinction without a difference. 4

I n its limited ex planation, the majority vag uely references 18 U.S.C. § 3661, which allows sentencing courts to receive
any information concerning a defendant’s “ba c kg round,

c h aracter, and conduct.” Maj. Op. 19. However, this provision, w h i c h “remov[ e s] ty p ical ‘ jury trial’ evidentiary limitations” on the information th at m a y be presented a nd considered at sentencing

, U nited S tates v. Booker

, 543 U.S. 220, 249 (2005), say s n othing of the gr o u nds upon which a

4 T h e m aj o rity

ch arg es th at

th e d issen t assu

m es J en n if

er R.’ s d iv o rce w as a m atter

o f s im p le arith m etic: it resu l ted f ro m th e l o s s of a certain su m o f m on ey , an d t h at s u m m u st h av e been
g reater th an $ 2 3 ,0 1 7 ; th eref o re, b ecau se J en n if

er R

. l ost

o n ly $ 2 3 ,0 1 7
, th e d istrict co u rt w as req u ired to ig n ore h er claim th at Ch risten sen ’ s co n d u ct h ad c a u s e d h er d iv o rce.

Maj . Op . 2 0

. B u t I m ak e n o su ch assu m ptio n ; in stead

, I tak e th e d istrict

c o u r t at its w o rd

. It stated : “ So n o t o n ly d id sh e [J en n if er R.] l ose h e r

en tire l i f e sav in g s, h er 1 9

- y ear m arriag e h as en d ed as a resu lt o f th e d efen d an t’s crimin a l b e h a v i o r

. ” (Em ph asis ad d ed .) Ev en m o re distu rb in g th an th e m aj o rity ’ s ref

u sal to co n f

ro n t th e f acts is its assertio n th at b ecau s e

“ m an y o f th e ‘ lif

e d estro y in g im

p acts’ w ere in div isib le,” id

. , w e n eed n o t

an d sh ou ld n ot ev en attem p t to p arse o ut w h a t h a rm w as cau sed b y a d ef en d an t ’ s crim in al co n d u ct.U N I T E D S T A T E S V

. C H R I S T E N S E N 34

district court may g rant an upward va riance. To the ex tent the majority implies that all information countenanced under § 3661 may serve a s the basis f or a variance, such is patently absurd. F or then, a sentencing c ourt could vary upward based

on a d efendant’s eating or dressing habits, the tradition o r school of y og a he favors, o r the reg ularity with which he
recy cles, all of which “ p r ovide g reater insig h t into [ the defendant’s] ‘backg round, character, and c o nduct.’” 5 Maj. Op. 18–19.

Fo r t h e s e r e a s o n s , I would h old that it is si gn i f i c a n t procedural error to rest an upward variance on the impact of a defendant’s lawful activities and conduct.

V.

Christensen must also establish prejudice, and to do so, he
must demonstrate that there is a “reasonable probability ” that the d istrict court’s error affected the outcome o f the sentencing

. W

hitney

, 673 F .3d at 972 (quoting United States

v. Marcus
, 130 S. Ct. 2159, 2164 (20 1 0 ) )

. Ordinarily

, this would be a difficult task g iven the inherent challeng es in identify ing “the effect of any disc r et e s e t of errors on a district court’s mu l tifaceted sentencing determination.” Id.

5 Ou r d ecisio n in Un ited S ta tes v. M erca d o , 4 7 4 F.3 d 65 4 (9 t

h Cir. 2 0 0 7 ), p ro v id es an ex am

ple o f w h en in f orm atio n receiv ed u n d er § 3 6 6 1

can b e p erti n e n t to a d ef en d an t ’ s crim in al activ ities. T h ere, w e cited § 3 6 6 1 in h o ld in g th at sen ten c i ng co u rts m ay co n sid er crim in al co n d u ct ch arg ed in th e in d ictm en t , b u t o f w h ich th e d ef

en d an t w as acq u i tted

, in calcu latin g th e d ef

en dan t’ s g u id elin es ran g e. S ee id

. at 6 5 6

– 5 7

. T h is

scen ario cen ters o n th e co n d u ct at issu e b ein g crimin a l

, req u irin g th at th e

sen ten cin g co u

rt fi n d b y a p rep o n d eran ce o f th e ev id en ce th at th e d ef en d an t is cu lp ab l e fo r t h e c h arg ed

, b u t acq u itted co n d u ct. S ee id

. at 6 5 5

– 5 6

.U N I T E D S T A T E S V

. C H R I S T E N S E N 35

Here, however, Christ e n s en is presented w ith no such difficulties g iven that the di s t r ict court made clear that the issue on which it committed error provided the central basis for its upward variance.

I n seeking to minimiz e t he import of this error, the majority paints a gr ossly distorted p icture of the district court’s decisionmaking process. Rather than infor m i n g the reader o f the district court’s unambig uous emphasis on victim impact, the majority relay s e very snippet of the sentencing hearing it can locate that would sug g est other considerations play ed a role in the sentencing decision. See Maj. Op. 7–9, 16.

T he majority alternatively holds that, even if the dis t r i ct court did err in overstating t h e i m p act of Christensen’s criminal conduct, Christensen cannot d emonstrate prejudice because it is “uncertain” whether th e o u t come would have been different if not for the error. M a j

. Op. 21–22. The majority ’s analy sis in this r eg a rd plac e s an incorrect, a nd virtually impossible to meet, burden on a d efendant under plain error review. To demonstrate p r ej u dice, Christensen need not show with absolute certainty that h e would have received a lesser sentence in the absence of the error, he need only show a “reasonable p r o b a b ility ” of such. See W hitney

, 673 F .3d at 972; see also U nited States v. Gonzalez-Aguilar

, 718 F .3d 1185, 1189 (9th Cir. 2 0 13). Given the overriding role that victim impact play ed at sentencing

, I have little difficulty finding a reasonable probability that the district
court would n ot h ave varied to the deg ree t h a t it did

– nineteen months above the h i gh e n d o f the g uidelines r ang e and almost double the low end of the g u idelines rang e

– had it not erred.U N I T E D S T A T E S V

. C H R I S T E N S E N 36

I ndeed, to not f

ind a r easonable probability o f prejudice when a district court’s error u n dermines the primary justification fo r i t s sentence makes a mockery of the requirement that the sentencing court adequately ex plain its decision, a requirement that is o f particular importance in the
contex t of a v ariance. S

ee Gall

, 5 52 U .S. at 46. I t is true that, in the present c a s e , t he d istrict court evidenced a desire to reach its eventual outcome reg a r dless of the reasons. Prior to the second sentencing h earing

, the district court indicated to the parties that it was considering vary ing on the basis o f Christensen’s personal use of the funds diverted. I t was only after Christensen submitted briefing as to why it would be i n appropriate to vary on this basis that the district court

s u d d e nly shifted g ears and chang ed its justification at t h e second hearing

, without advance no t ice, to victim impact. However, it would b e perverse to find a lack of prejudice because w e suspect that a d istrict court was bent on reaching

a particular outcome. The integ r ity of the sentencing process requires that we take a district court at its w o r d a s t o the reasons for the sentence imposed. See id. at 50 (“[ A district court] must adequately

ex plain the chosen sentence to allow for meaning ful appellate review a n d to promote the perception of fair sentencing

. ” )

. Here, those reasons were fundamentally

flawed.

VI.

The di s t rict court committed “sig nificant procedural error” in imposing an upward variance on the b asis o f investor l o s ses that were not attributable to Christensen’s criminal conduct. This was prejudicial error, and Christensen is entitled to resentenc i n g

. According ly

, I would vacate the
sentence and r emand for resentencing

. I respectfully dissent.