UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_______________________________

No. 96-20563

_______________________________

UNITED STATES OF AMERICA,

Plaintiff-Appellee/Cross-Appellant,

versus

JOSEPH PANKHURST,

Defendant-Appellant/Cross-Appellee.

_________________________________________________________________

Appeals from the United States District Court

for the Southern District of Texas

_________________________________________________________________ July 21, 1997

Before SMITH, BARKSDALE, and BENAVIDES, Circuit Judges.

RHESA HAWKINS BARKSDALE, Circuit Judge:

The principal issue at hand is whether, prior to a sua sponte

downward departure, the district court must give F ED

. R. C RIM

. P. 32

pre-sentencing notice to the Government. Joseph Pankhurst appeals

his conviction under 18 U.S.C. § 201(b)(1)(A) for “corruptly

giv[ing] ... [$10,000] to [a] public official ... with ... intent

... to influence [an] official act”; he challenges both the jury

instruction describing the “official act” (“acceptance of an offer

by [Pankhurst] to purchase a loan being sold

... by the Resolution

Trust Corporation”) and the sufficiency of the evidence, especially

concerning his corrupt intent. The Government cross-appeals from

the downward departure, in part because it was not given notice.

We AFFIRM

the conviction, but VACATE and REMAND for resentencing.- 2 - I.

Pankhurst and his wife owned Atlas Oil Company. In early

1992, Pankhurst, through Atlas Oil, acquired Jetera Fuels

Terminaling Corporation for only $2,500. But, Jetera was burdened

with a $5.6 million debt on two loans from TexasBanc Savings (TBS),

with monthly payments of approximately $60,00 0 and with Jetera’s

property as security. TBS had failed prior to Atlas Oil’s

acquisition of Jetera; the TBS loans were managed by the Resolution

Trust Corporation (RTC), which, inter alia

, had the p ower to

foreclose on Jetera’s property in event of default.

In mid-1992, although Jetera was not in default on either loan

and was profitable, Pankhurst, a s chairman of Jetera, requested

that the RTC consolidate the loans and reduce the principal to

$1.75 million. The RTC responded that the loans had been grouped

with others for sale, and that their terms could not be negotiated

then. Later that year, Jetera defaulted on the loans.

In response to the default, the RTC advised Pankhurst that it

would order an appraisal and environmental assessment of Jetera.

Pankhurst, again on behalf of Jetera, again requested l oan

consolidation and reduction.

In June 1993, Pankhurst, now on behalf of Atlas Oil Company

,

offered to the RTC to purchase for $500,000 either the Jetera

property or the Jetera loans. In response, Ronnie Hooks, a

contract employee for the RTC who was acting as senior asset

manager for TBS, met with Pankhurst at the RTC’s offices in

Houston, Texas.- 3 -

Hooks advised Pankhurst at t he meeting that the RTC had

received competing offers for the property securing the loans; that

Jetera’s appraised value was approximately $800,000; that the RTC

was receiving approximately 70% of the appraised value for similar

properties; and that, therefore, if Pankhurst increased his offer

from $500,000 to $560,000, it might be accepted. Pankhurst

increased his off er accordingly. And, later in the discussions,

Pankhurst placed a stack of cash on the table. At this meeting,

Hooks informed Pankhurst that he did not have the authority to

accept P ankhurst’s $560,000 offer to the RTC; in addition, he

neither accepted nor rejected Pankhurst’s offer of cash.

Concerning the cash placed on the table, Pankhurst testified

that he had asked if an attorney would be necessary, and whether

Hooks knew anyone willing to act as a consultant during the

negotiations with the RTC; that he stated to Hooks that he had seen

advertisements about former RTC employees offering to work as

consultants; that he opened his briefcase in order to show Hooks

such an advertisement, stating that he had seen about “ten of

t hese” ; and that some cash also happened to be in the briefcase,

because he was about to make a deposi t and, therefore, a deposit

slip was bound to the top of the cash. On the other hand, Hooks

testified that he unders tood the “ten of these” comment to be a

reference to ten similar piles of cash.

Hooks reported Pankhurst’s actions concerning the cash to the

RTC. A n investigation en sued, with Hooks assisting the FBI. In

recorded telephone conversations, Hooks and Pankhurst discussed- 4 -

different documents Pankhurst would have to submit to the RTC, and

the amount of Hooks’ “consulting fee”, which they set at $10,000.

During these recorded conversations, Hooks told Pankhurst that

he did not want to meet at obvious pl aces. They met at a hotel;

Pankhurst then took Hooks to Pankhurst’s car.

At the car, Hooks, wearing a recording device, stated that he

had more work to do to get Pankhurst the deal he wanted from the

RTC; that he had been afraid when Pankhurst first approached him

about the deal in the RTC offices; and that, within a few days, he

could obtain acceptance of Pankhurst’s offer to the RTC.

At that point, Pankhurst said that he would pay Hooks half of

the $10,000 then and the other half when his offer to the RTC was

accepted. He handed Hooks a binder labeled “corporate records”;

the binder contained cash. Pankhurst gave Hooks part of the cash

and said he would keep the rest in the trunk of his automobile.

Hooks delivered to the FBI the binder received from Pankhurst.

It contained $5,000 in cash.

At Hooks’ request, the two men met two days later at the same

hotel. Again, Hooks was wearing a recording device and they met in

Pankhurst’s car. Pankhurst handed Hooks a letter offering

$560,000, a settlement document, and a $2,000 earnest money check.

In turn, Hooks gave Pankhurst a letter accepting the offer, and

explained that Atlas Oil would be the purchaser and that the

transaction would probably close by the end of the month. When

Hooks asked about job opportunities, Pankhurst suggested that Hooks- 5 -

work for him. Pankhurst also gave Hooks the second $5,000 in a

brown manila envelope, telling him to “put this in your briefcase”.

Pankhurst was arrested at the subsequent, videotaped meeting

he was instructed to attend to close the transaction. He was

convicted by a jury of bribery of a public official, a violation of

18 U.S.C. § 201(b)(1)(A). Pankhurst’s motions, during and after

trial, for judgment of acquittal were denied, as was his motion for

new trial.

At sentencing, consistent with th e recommendation in the

Presentence Report, the Government urged a guidelines sentenc ing

r ange of 51 to 63 months. Instead, the district court, without

having given Rule 32 pre-sentencing notice of a possible downward

departure, ruled that the guidelines did not apply adequately to

Pankhurst’s offense and ordered a downward departure. Because of

the resulting low offense level, and the fact that Pankhurst was a

first offender, probation was a sentencing option. Pankhurst was

placed on probation for one year (with home confinement) and fined

$50,000. The sentence was stayed pending appeal.

II.

Pankhurst challenges the description for the “official act”

used in the jury charge and claims there was insufficient evidence

for conviction, in part because of a claimed failure to prove

corrupt intent. The Government challenges the downward departure,

contending in part that it made a sufficient objection at

sentencing about not being given notice of a possible departure.- 6 - A.

Pankhurst’s one count indictment contained two possible

grounds for conviction. He was charged with violating subparts (A)

and (B) of 18 U.S.C. § 201(b)(1), which proscribes:

[d]irectly or indirectly, corruptly giv[ing],

offer[ing] or promis[ing] anything of value to

any public official ... with intent ...

(A) to influence any official act; or

(B) to influe nce such public official ... to

commit or aid in committing ... any fraud ...

on the United States....

18 U.S.C. § 201(b)(1). But, the court did not submit subpart (B)

(fraud) to the jury as a possible basi s for conviction.

Accordingly, the only possible basis for conviction was an intent

“to influence an official act” (subpart (A)), not an intent to

effect a fraud on the United States (subpart (B)).

Accordingly, the court instructed the jury that it could

return a guilty verdict only if it found, beyond a reasonable

doubt, both that Pankhurst “directly or indirectly gave, offered or

promised $10,000 to Ronald Hooks, a public official”; and that

P ankhurst “did so corruptly [defined for the jury as “d one

intentionally with an unlawful purpose”], with intent to influence

an official act by a public o fficial”. The “official act” was

defined as the act described in the indictment; therefore, the

pertinent por tion of the indictment was included then in the

charge:

Pankhurst, did directly and ind irectly

corruptly give, offer, and promise

... $10,000

... to a public official, namely Ronald

Hooks[, ] ... with the intent to influence an1 Concerning the difference in punctuation surrounding

“that is” in the last sentence of the above-quoted transcribed

charge and in the indictment, see note 2, infra

.

- 7 - official act and to influence a public

official, namely Ronald Hooks, to commit and

aid in c o mmitting a fraud upon the United

States. That is the acceptance of an offer by

the defendant to purchase a loan being sold to

the public by the Resolution Trust

Corporation. 1

The court’s proposed charge had not contained a definition or

description of the “official act” in issue. At the earlier charge

conference, in his objections to that proposed charge, Pankhurst’s

counsel had contended, in a very general way, that the court should

add such a definition or description. But, other than referring to

the language in the indictment, Pankhurst’s counsel did not offer

a definition. And, when the court stated that the description in

the i ndictment would constitute the definition for the “official

act”, Pankhurst’s counsel did not object to the inclusion of the

fraud language also contained there. Restated, he did not request

that the fraud language be redacted. In fact, he agreed to the

indictment, which inc luded the fraud language, being used as the

description or definition of the official act.

Now, however, on appeal with different counsel, Pankhurst

asserts that the court committed reversible error in its “official

act” instruction. Pankhurst complains that, instead of granting

his “requ est[] ... [to] instruct the jury specifically what they

must find as the ‘official act’”, the court used the indictment for

that purpose. Likewise, he complains, most belatedly, that the2 As for the inclusion of the fraud language, Pankhurst

claims also that it caused confusion and deprived him of a fair

trial. The indictment was provided to the jury for its

deliberation. As indicated in note 1, s upra

, for the “official

act” descr iption, the punctuation used in the indictment is

slightly different from that used in the transcript of that portion

of the jury charge when the district court, in response to

Pankhurst’s request for a definition of the official act, verbally

incorporated part of the indictment in defining the official act.

The pertinent part of the indictment reads: “with the intent to

influence an official act and to influence a public official,

namely Ronald Hooks, to commit and aid in committing a fraud upon

the United States , that is, the acceptance of an offer by the

- 8 - indictment contained language concerning fraud as a possible aim of

the payment t o Hooks, making conviction on the fraud element

possible, even though the court refused to submit that element to

the j ury. In the alternative, Pankhurst urges, again most

belatedly, that, because the fraud language was left in, it should

have been defined.

But, again, Pankhurst did not object to the inclusion of the

fraud language, nor to the failure to define fraud, when the court

opted to use the indictment to describe the official act. As

noted, Pankhurst had, however, requested earlier that the court

define the official act. On the other hand, as also noted, he did

not provide or suggest a definition, other than agreeing to the

indictment’s language being incorporated for that purpose.

Therefore, were Pankhurst challenging only th e inclusion of

the fraud language, we would, at most, review only for plain error.

E.g., United States v. Calverley

, 37 F.3d 160, 162-64 (5th Cir.

1994)(en banc). (In fact, as discussed i nfra

, based on the

co lloquy at the charge conference, the issue presented is quite

close to being invited error.) 2 However, because Pankhurst diddefendant to purchase a loan being sold to the public by the

[RTC].” (Emphasis added.) As reflected in the portion of the

charge quoted in the text, supra

, the transcript of the charge, as

read to the jury, uses a period, instead of a comma, between “upon

the United States” and “that is” and does not have a comma after

“that is”. It reads in part: “with the intent to influence an

official act and to influence a public official ... to commit ...

a fraud upon the United States. That is the acceptance of an

offer....”

Of course , the court reporter was simply transcribing the

trial judge’s verbal inclusion of this part of the indictment. The

version seen by the jury was in the indictment. We note this

punctuation difference only as a hyper-technical partial response

to Pankhurst’s hyper-technical, semantic contention about jury

confusion.

Pankhurst urges that the phrase “that is” caused confusion

because the act described after “that is” (accept ance of

Pankhurst’s offer for the loan) might be understood to refer to the

“influence fr aud” portion of the charge, as opposed to the

“influence an official act” portion; and that, as a result, both

the indictment and charge were “vague a nd ambiguous”, making it

doubtful that the jury returned a unanimous verdict as to what the

“official act” was and, therefore, deprived him of his right to a

fair trial.

We disagree. First, the pertinent portions of the indictment

and the charge are neither vague nor ambiguous. It is clear that,

in each, the act described after “that is” refers to the official

act as well as to fraud. And, in any event, Pankhurst did not

present this objection at trial; again, even if there were an

error , we would review only for plain error. Once again, new

(appellate) counsel is raising a point that former (trial) counsel

apparentl y felt, correctly, was not a source of error. In sum,

there was no error.

- 9 - object generally at the charge conference to the failure of the

proposed charge to describe or define the official act, we will,

m ost d ubitante

, review, under our usual standard, the refusal to

grant the requested instruction. (The detailed review that follows

is also for the purpose of demonstrating further the total lack of

merit in this issue.)- 10 -

Jury charges are reviewed only for an abuse of discretion; we

determine “whether the court’s charge, as a whole, is a correct

statement of the law and whether it clearly instructs jurors as to

the principles of law applicable to the factual issues confronting

them.” U

nited States v. McKinney

, 53 F.3 d 664, 676 (5th Cir.)

cert. denied

, 116 S. Ct. 261 (1995). If the trial court refuses a

requested instruction, the requesting party must demonstrate that

the proposal: (1) was a correct statement of the law; (2) was not

substantially covered in the charge as a whole; and (3) concerned

an important point in the trial such that failure to instruct the

jury on the issue seriously impaired the defendant’s ability to

present a given defense. United States v. Smithson , 49 F.3d 138,

142 (5th Cir. 1995) citing, United States v. Chaney

, 964 F.2d 437,

444 (5th Cir. 1992).

Obviously, with respect to the first part of the test,

Pankhurst suffers greatly from his failure to submit to the

district court a specific definition of the “official act”. As

pr ovided for by F E D

. R. C RIM

. P. 30, he should have submitted a

written request; he did not even verbally offer a defi nition.

Needless to say, without a specific proposal to review, we cannot

say that the definition which Pankhurst may have wanted would have

been legally correct. His failure to submit a definition to the

court deprives us of the very subject of the requested appellate

review. Pankhurst’s mere (assumed) objection to the instruction

is, in short, ineffective, and, most arguably, brings our review of

this issue to a close.- 11 -

But, in any event , the charge, as a whole, substantially

covered Pankhurst’s request. Even assuming that the incorporation

of part of the indictment in the charge possibly suggested fraud to

the jury as a possible intended result of the charged bribe, fraud

was not a permissible basis for conviction, because the c ourt

removed the fraud portion of the indictment from the jury’s

consideration. Again, the jury was charged only under subpart (A)

(intent to influence official act).

As stated, in reviewing jury instructions, we look at the

instructions as a whole. M cKinney

, 53 F.3d at 676. As given to

the jury, the factual allegation underlying inducing fraud was

exactly the same as that for influencing an official act: “That is

the acceptance of an offer by [Pankhurst] to purchase a loan being

sold to the public....” This intent was the only one listed in the

indictment and the only one argued by the Government. In the trial

court’s exercise of discretion, it determined that the intent

element of § 201(b)(1)(A) was satisfied, under the facts of this

case, if the jury found that Pankhurst had intended, through

payment of $10,000 to Hooks, to influen ce the RTC to accept his

offer.

While the jury charge m ay have also erroneously included a

description of this intent as § 201(b)(1)(B) “fraud”, that will not

defeat the fact that such intent also satisfied the “official act”

prong of § 201(b)(1)(A). S ee note 2, supra

. The Government still

had to prove, beyond a reasonable doubt, that Pankhurst intended to

influence the RTC’s acceptance of his offer. Therefore, the jury- 12 -

charge substantially covered Pankhurst’s request, as that request

would not have changed the burden on the Government or the possible

defenses available to Pankhurst.

As noted, Pankhurst changed counsel after trial. Concerning

this requested instruction issue, it is most enlightening that, in

closing argument, Pankhurst’s trial counsel pushed th e fraud

concept vigorously:

They charged that Joe Pankhurst with intent

corruptly gave $10,000 to Ronnie Hooks with

the intent to influence an official act. And

here is the official act: To commit and aid in

committing a fraud upon the United States,

that is the acceptance of an offer by the

defendant to purchase a loan being sold to the

public by the Resolution Trust Corporation.

First place, it wasn’t being sold to the

public, it failed right there. But in the

second place, he wasn’t trying to get to

perpetrate a fraud. He was trying to do a

reasonable business deal

...

(Emphasis added.) In short, Pankhurst combined fraud and

influencing the official act. As discussed below, this was his

apparent strategy. Moreover, as noted, the defenses available to

Pankhurst were exactly the same as if the court had granted his

request and had therefore defined or described the official act in

some other way; Pankhurst still had to counter the Government’s

contention that he had intended, through a payment to Hooks, to

influence the RTC’s acceptance of his offer.

It bears repeating that Pankhurst agreed to the indictment’s

being included in place of some other definition of the “official

act”. As referenced earlier, we will not hold that agreement to

constitute invited error, because Pankhurst had, at least, earlier- 13 -

requested a definition, even though the request was very general,

if not vague, and even though he did not provide the desired

language. But, as also reflected in this record, Pankhurst’s

subse quent agreement to the indictment’s being used as the

definition, supplemented by his comments during the charge

conference, as il luminated by responding comments by the trial

judge, certai nly cause the claimed error to border on invited

error. This is demonstrated further by the fact that Pankhurst’s

post-verdict motions for judgment and for new t rial urge, i nter

alia , that the jury had to find f raud

, and that the evidence was

insufficient on that point. In essence, what we are being

presented with on appeal, in par t, is appellate counsel’s quite

different view of the case from that of trial counsel. It goes

without saying that points raised at trial are the points that

control on appeal.

In sum, pursuant to our three-part review in regard to refusal

of a requested instruction, there was no reversible error. In

fact, as discussed ad nauseum , Pankhurst’s appellate counsel have

tried, in large part most improperly, to present a point of error

where there was none. They have, for the most part, attempted to

“rewrite history”. They fail. The record is clear; what took

place, took place. With the instructions, to which he agreed,

Pankhurst’s trial counsel was given, and permitted to do, exactly

what he wanted, to argue exactly what he wanted to argue.

In respo nding to Pankhurst’s contentions about the jury

charge, the Government’s brief points out what is immediately- 14 -

obvious from reviewing the charge conference and a few related

documents. The Government notes, i nter alia

, that Pankhurst did

not submit a proposed instruction prior to the conference; that the

trial court “essentially granted Pankhurst’s instruction request”;

that Pankhurst did not object to the included fraud langu age,

limiting review to plain error on that point; and that,

“[c]onceivably, Pankhurst ‘invited’ the error of which he now

complains” . Despite these serious, and correct, charges by the

Government, Pankhurst does not have one word in response in his

“Brief For the Cross-Appellee And Reply Brief For The Appellant”.

Instead, that brief deals only with the sentencing issue raised in

the Government’s cross-appeal.

This lack of response concerning an issue that, based on our

exhaustive review, has no merit further fuels our concern about why

this point was raised, and, espec ially, how it was

presented/briefed. Pankhurst’s appellate counsel have fallen far

short of making a fair, much less accurate, presentation of the

charge conference and related issues. They have presented an issue

totally lacking in merit. Counsel are warned that such conduct in

the future may result in sanctions being imposed against them.

B.

In district court, Pankhurst preserved our usual standard of

review for his sufficiency issue by moving, at the close of the

Governme nt’s case and at the close of the evidence, under F E D

. R.

C RIM

. P. 29(a), for a judgment of acquittal, contending, inter alia

,

that the evidence was insufficient to prove criminal intent beyond- 15 -

a reasonable doubt. S ee United States v. Castaneda-Cantu

, 20 F.3d

1325, 1329-30 (5th Cir. 1994); United States v. Knezek

, 964 F.2d

394, 399-400 & n.14 (5th Cir. 1992). (After the verdict, Pankhurst

unsuccessfully moved for such judgment or for new trial and, later,

for reconsideration of the denial of that motion.) Therefore, the

standard of review is whether the evidence, as viewed in the light

most favorable to the verdict, would permit a rational trier of

fact to find Pankhurst guilty beyond a reasonable doubt. U nited

States v. Jaramillo

, 42 F.3d 920, 922-23 (5th Cir.), cert. denied

,

U.S. , 115 S. Ct. 2014 (1995); Castaneda-Cantu

, 20 F.3d at

1330.

A conviction under 18 U.S.C. § 201(b)(1)(A) requires: (1) that

Pan k hurst directly, or indirectly, corruptly gave, offered or

promised anything of value; (2) to any public official; (3) with

intent to influence any official act. U nited States v. Tomblin

, 46

F.3d 1369, 1376 (5th Cir. 1995). The evidence showed that

Pankhurst negotiated with th e RTC to purchase the Jetera loans;

that, during these negotiations, he showed Hooks a stack of cash

and said an acceptance of his offer would be worth ten of them;

that, in surreptitious, but recorded, meetings, Pankhurst handed

Hooks a “corporate records” binder which instead contained $5000 in

cash, and then offered, and later delivered, the other half of the

$10,000 when he r eceived acceptance of his offer to the RTC; and

that Pankhurst attempted to close his “deal” with the RTC.

In short, there was sufficient evidence that money was offered

to Hooks, a public official, and that the goal was to influence the- 16 -

RTC’s acceptance of Pankhurst’s loan purchase offer, an o fficial

act. In addition, as both shown above and discussed further below,

the evidence was more than sufficient regarding the requisite

“corrupt” intent in offering the $10,000 to Hooks.

There was evidence that, without corrupt intent, Pankhurst was

offering the $10,000 to Hooks as some type of “consulting fee” (as

if that could be without such intent), and this view is supported

by the fact that the loan-purchase offer Pankhurst made to the RTC

could have been accepted by the RTC regardless of any influence on

the part of Hooks. This is further corroborated by the fact that,

at the sham closing, Pankhurst was careful that none of the

documents contained any misstatements to the RTC. (Although this

meeting was videotaped, Pankhurst’s trial counsel failed, through

claimed oversight, to offer the tape in evidence. Post-trial, it

was submitted to the court by Pankhurst’s trial counsel for

consideration on sentenc ing.) Regardless of these facts,

Pankhurst’s claim fails for a number of reasons.

First, despite complaining of an apparent lack of integrity

a mong the jury, Pankhurst does not contend there was ju ror

misconduct or any external pressure on the jury to convict. He

points to a pre-sentencing letter to the trial judge from the jury

foreperson, which stated that “... we ha[d] no proof that Mr.

Pankhurst intentional[ly] walked into the Resolution Trust

Corporation’s office on the day in question and offered to bribe

Mr. Hooks”; that the reason the jury decided to convict was because

on Friday, when they were deadlocked at 9-3 to convict, they were- 17 -

told that, if they did not then reach a verdict, they would return

on Monday, and, as a result, the three holdouts quickly changed

their minds; and that, despite the professed lack of proof of

intent, the jury voted to convict because Pankhurst was wealthy and

had retained an expensive lawyer.

This does not rise to the level of noticeable juror

misconduct. (At sentencing, the court advised counsel that the

letter had been submitted; Pankhurst’s lawyer had known of its

probable submission and his inquiry about the letter prompted the

court’s reference to it. Despite suggesting that he might do so,

Pankhurst did not seek to move for a new trial based on it.

Reference to the letter, and the court’s deferring action on it

“until the matter arises”, are included in the court’s sentencingruling, quoted infra .) In any event, Pankhurst raises only

sufficiency, not juror misconduct; the points made about the jury

do not affect our suf ficiency analysis. Restated, the objective

sufficiency standard obviously does not include examination of jury

deliberations or the jurors’ true feelings; instead, we examine the

evidence to determine whether it was sufficient for a rational jury

to convict. Jaramillo , 42 F.3d at 922-23.

As discussed, the evidence was more than sufficient. For

example, it included recordings o f the two meetings in which

Pankhurst gave the $10,000

-- in $5,000 increments

-- to Hooks.

These recordings include discussion about their first meeting, at

the RTC office, during which Pankhurst placed the money on the

table. As reflected by the recording of the second- 18 -

hotel/automobile meeting, Hooks stated: “But it scared me when you

walked into the office and

... laid that fee on the table and said,

‘hey,

... I need a consultant’ or something. It scared me ... and

I had to give it some thought.” Pankhurst replied: “Of course, ...

but who’s got time to do the romance deal and the little tap dance;

... here it is; and ... that’s the way I saw it.”

Hooks testified that Pankhurst offered him $10,000 to act as

“consultant” throughout the negotiation process. The manner of the

transfer of the cash, at surreptitious meetings and hidden in a

“ corporate records” binder and in a plain brown manila envelo pe,

point to Pankhurst’s corrupt intent. Moreover, the fact that the

second half of the payment to Hooks was not to be made until after

Pankhurst received acceptance of his offer to the RTC points to the

fact that this was not a consultant fee, but a quid pro quo for the

RTC’s acceptance of Pankhurst’s offer.

This was a classic case for a jury. The competing evidence

may seem convincing to some, but it presents merely an alternative

to the decision a rational jury could reach. The contention that

Pankhurst did not want to mislead the RTC in any of the closing

documents, Pa nkhurst’s testimony that he was attempting to hire

Hooks as a “consultant” and that he thought this sort of

transaction was legal and common, and the testimony about his good

character, do not render the other evidence insufficient as a basis

for conviction by a rational jury. Under these circumstances we

cannot upset the verdict. E .g., United States v. Pettigrew

, 77

F.3d 1500, 1518 (5th Cir. 1996)(“The evidence need not exclude- 19 -

every reasonable hypothesis of innocence ... and the jury is free

to choose among reasonable constructions of the evidence.”).

Finally, Pankhurst contends that the evidence was insufficient

to prove that the loan he was attempt ing to purchase was in fact

being sold to the public. The issue is meritless. The indictment

charged that the official act w hich Pankhurst attempted to

corruptly influence was the acceptance of his offer to purchase the

loan. The indictment states further, unnecessarily for purposes of

§ 201(b )(1)(A), that the loan had been offered for sale to the

public. This description of the loan Pankhurst was trying to

purchase was surplusage; even if the evidence did not support a

findi ng that the loan was offered to the public, the statute was

satisfied and the conviction must stand.

In the alternative, Pankhurst seeks a new trial. We review

denials of such m otions for abuse of discretion. E .g., United

States v. Giraldi

, 86 F.3d 1368, 1374 (5th Cir. 1996). For the

reasons gi ven above, the district court did not abuse its

discretion.

C.

The challenge to the dist rict court’s s ua sponte downward

departure is premised on both a lack of notice and the basis for

the departure. In urging that the departure should be affirmed,

Pankhurst counters, inter alia

, that the Government failed to

object to the departure

-- both to lack of notice and on the

merits.- 20 -

As hereinafter discussed, we conclude, based on our review of

the record, that the Government’s lack-of-notice ob jection was

sufficient, even though it could

- and should

- have been far more

specific. And, we conclude that, because the requisite Rule 32

notice of a possible downward departure was not given, we must

remand for resentencing; therefore, we do not reach whether the

departure would be upheld. For our analysis, a most detailed

review of Pankhurst’s sentencing process is required. Moreover,

this detailed presentation highlights the extremely careful

attention and painstaking analysis given the merits of the

sentencing issue/departure question by the district court.

The Presentence Report (PSR) recommended that Pankhurst’s

required base offense of 10 under U.S.S.G. § 2C1.1(a), for bribery

of a public official, be increased, as required by § 2C1.1(b)(2)

(“Specific Offense Characteristics”); a 14-level increase was

recommended, on the basis that th e requisite “benefit” to be

received in return for the $1 0,000 payment was $5,053,000.

(Pursuant to § 2C1.1(b)(2), because the “benefit” exceeded $2,000,

reference was made to the table in § 2F1. (“Fraud or Deceit”); the

offense level is to be increased by 14 if the loss exceeds $5

million.)

Because Pankhurst ( a first offender) had a criminal history

category of I, th e guidelines sentencing range was 51-63 months.

Pursuant to Rule 32(b)(4)(B), the PSR comm ented on possible

sentencing adjustments; it recommended, inte r alia , against a

reduction for acceptance of responsibility, and, critical to the- 21 -

issue at hand, stated that the probation officer did not have any

information concerning either the offense or Pankhurst which would

justify a departure from the guidelines’ sentencing range.

In his pre-sentencing filing in response to the PSR, Pankhurst

stated that, in addition to prosecuting Pankhurst, the Government

had

sought to ruin him financially in the business

world. That ruination has been extremely

effective. This is a factor that has not been

taken into consideration adequately by the

Sentencing Commission and entitles [Pankhurst]

to a downward departure.

The Government’s pre-sentencing response objected to Pankhurst’s

downward departure demand, stating with regard to the claimed

attempt to “ruin” Pankhurst that, as with all convictio ns, there

had been a press release.

At sentenci ng, in support of the PSR’s recommendation that

the benefit was in excess of $5 million, the Government urged that

the loss was greater than that: simply put, Pankhurst had offered

$560,000 for the loans to Jetera, for which slightly more than $5.6

million was owed, and which were secured by the Jetera property;

deducting that $560,000 from the approximate $5.6 million owed left

a benefit in excess of $5 million.

As he had in his objections to the PSR, Pankhurst countered at

sentencing that there was no “b enefit” (thus leaving the offense

level at 10), asserting that, even without the $10,000 payment to

Hooks, Pankhurst would have still acquired the loans/property for

the $560,000 offered. Along that line, Pankhurst pointed out that,- 22 -

in fact, the RTC later accepted only $419,000 for the property, far

less than the $560,000 Pankhurst had offered.

In the alternative, Pankhurst urged that, at most, the gain,

not benefit, would have been what Atlas Oil (the actual offeror

--

owned by Pankhurst) might have realized later if it had both

acquired the property and sold it; using the offer of $560,000 and

the then-appraised value of $800,000, this sale would have resulted

in a gain of $240,000. But, Pankhurst argued that, because neither

event occurred, there was no “benefit” for guid elines purposes,

again leaving the offense level at 10.

Having an offense level no greater than 10 was critical for

Pankhurst. As noted s upra

, for a “first offender” such as

Pankhurst, and with that offense level, the sentencing court “may

substitute probation for a prison term”. U.S.S.G. Ch. 1 Pt. A 4(d)

(1995).

After hearing extensive and detailed argument concerning the

parties’ vastly different positions as to the § 2C 1.1(b)(2)

“benefit”, the court stated: “When I hear two intelligent lawyers

as thoroughly f amiliar with the facts as you two, in this much

disagreement, I just wonder if there is not a problem in the

guidelines .” (Emphasis added.) (The sentencing judge’s comments

were consistent with his views expressed thre e weeks earlier, at

the originally-scheduled sentencing hearing; that hearing was

continued because of Pankhurst’s late receipt of the Government’s

response to his objection s to the PSR. Prior to continuing that

earlier hearing, the court heard similar argument by Pankhurst on- 23 -

why there was no “benefit”; the court indicated then that it was

open on the issue.)

After further detailed argument, the court stated:

We can stop right now on one point. I do not

believe there was any actual gain. There was

a possible remote potential gain, at least one

level removed, that [Pankhurst] might have

wound up with a corporation [Atlas Oil] with a piece of property that might be worth

$800,000, that [Pankhurst] got for $560,000.

Following further argument over “benefit”, vel non

, the court

stated:

You both are absolutely right up to a certain

point. I think this is a unique fact

situation. I think what Mr. Pankhurst did was

offer a bribe to do something that he could

have done without a bribe. It was a, excuse

the technical t erm, a dumb thing to do. And

it constituted a violation of the law.

What we are talking about now is what the

appropriate punishment would be and whether

the sentencing guidelines covers it

. A nd I am slowly becoming convinced that because of the

facts in this case, it is not something that I

can find in the guidelines. I am having a

real struggle with it

.

(Emphasis added.)

Following yet further argument as to “benefit”, and apparently

taking hope i n the court’s twice-expressed concerns that the

incident under consideration was not covered by th e guidelines,

Pankhurst urged, for the first time , a downward departure on that

basis, claiming that the si tuation had “not [been] taken into

consideration adequately” by the Guidelines. But, as the

Government immediately pointed out, this departure-basis was

totally different from the basis urged in Pankhurst’s pre-hearing- 24 -

submission, discussed s upra . As noted, and as the Government

p ointed out to the district court, Pankhurst had then claimed

entitlement to a departure, but only on the basis that the

Government had ruined his ability to do business. As the

Government had discussed in its filed response to the earlier filed

departure demand, the Government pointed out to the sentencing

judge that Pankhurst based this entitlement claim on harm

supposedly resulting from a press release about his conviction.

Following even more argument, the court ruled:

All right. I have given this matter a great

deal of thought. I have considered, with the

probation officers, their various addenda and

supplements.

And I believe that the probation officers are

correct, and I adopt their report, that the

base offense level is ten; that the potential

benefit to Mr. Pankhurst through his ownership

of the [Atlas Oil] stock was most likely the

difference between $560,000 and $800,000.

I believe that $800,000 was the appraised

value of the property at the time [Pankhurst]

made the $560,000 offer, and therefore I

believe that is the benefit [Pankhurst]

intended to receive.

With his criminal history category of one, his

guideline imprisonment range at that point

would be 27 to 33 months.

His argument that he is entitled to a two

level decrease for acceptance of

responsib ility is a close one. But I have

never he a rd him admit that he offered the

money to Mr. Hooks for th e purpose of

influencing Mr. Hooks to do something.

Certainly he would no t admit that he offered

it as a bribe. Therefore I cannot give him

acceptance of responsibility.- 25 - I am not impressed with the let ter from the

foreperson of the jury [discussed supra ]. We

will take that up if the matter arises.

But I do want to point out [that] page 7 of

the latest version [1995] of the guidelines

man u al has this sentence in it[:] [“]The

commission of course has not dealt w ith the

single acts of aberrant behavior that still

may justify probation at higher levels through

departures.[”]

And what they are referring to is [U.S.S.G. §]

5K2.0 and 18 [U.S.C. §] 3553. And pursuant to

those provisions, I find that there exists

mitigating circumstances of a kind and a

degree not adequately taken into consideration

by the Sentencing Commission in formulating

the guidelines, and therefore the sentence

should be different from that provided in the

guidelines. Specifically, the difference, the

increase over the ten level.

I think the facts in this case are so peculiar

and in su ch a strange state that the

guidelines do not apply adequately in that

increase. Therefore I am going to sentence

him at level 10.

Pursuant to the re sulting option given the court because of

that low offense level to place Pankhurst on probation, rather than

in prison, Pankhurst was given probation for one year, with a

condition of home confinement. He was also fined $50,000. Later,

the court remarked: “Mr. Pankhurst, because of the very peculiar

facts of this case, I am giving you a break which the Government is

going to be very upset about. I may have sentenced you both to [an

appeal to the Fifth Circuit in] New Orleans.”

The court had not put the parties on notice of this possible

-- and now just announced

-- basis for departure. But, unlike its

objection earlier in the hearing, when Pankhurst seized on this

basis for the first time, the Government did not object, after the- 26 -

sentencing-ruling, on the ground that the court was departing

downward without giving Rule 32 pre-sentencing notice. Instead,

a t this point (post-ruling), the Government objected only to the

basis for the departure, and objected later to the court’s not

imposing sentence within the range recommended by the PSR.

The judgment, entered six days after the sentencing hearing,

provided that the PSR was adopted, except that the court found a

lower “benefit” ($240,000 instead of $5 million), resulting in an

8, instead of a 14, level increase. This resulted in a total

offense level of 18, with a sentencing range of 27 to 33 months, as

had been stated in the court’s verbal sentencin g-ruling. The

following reason was t hen given for the downward departure,

consistent with that given at sentencing and pursuant to 18 U.S.C.

§ 3553(b) and U.S.S.G. § 5K2.0: “The Court finds that the nature of

the offense, representing a single, criminal act, is a mitigating

circumstance of a kind, or to a degree, not adequately taken into

consideration by the Sentencing Commission, pursuant to U .S.S.G.

5K2.0.”

Before we can reach the merits of the basis for the departure,

we must consider the Government’s contention that it was denied the

requisite Rule 32 notice of the court’s intent to depart downward.

It is undisputed that the court did not give such notice to the

parties. And, prior to sentencing, the only departure-basis urged

by Pankhurst was the claim that he was “entitled” to a downward

departure because the Gov ernment had “ruin[ed] him financially”.

But, as noted, after the court alluded twice a t sentencing to a- 27 -

possible basis for a § 5K2.0 departure, Pankhurst’s counsel seized

upon it:

I think that this is a proper cas e for a

departure because the guidelines has not taken

into consideration adequately the

circumstances of this case, and under the

catchall provision of the guidelines and the

Code, and I have ci ted that to Your Honor in

the memorandum.

As also noted, the Government objected immediately:

Judge, the government would object to a

downward departure. [Pankhurst’s counsel]

specifically said that the basis for his

downward departure was because the Government

had basically ruined his client’s ability to

do business by sending an alleged press

release to Dunn & Bradstreet.

In short, the Governme nt objected promptly to the fact that

the departure, alluded to by the court, was being requested by

Pankhurst on a new ground for which the Government had not received

pre-hearing notice. Restated, at that point in the hearing, the

objection alerted the court, as well as Pankhurst, that the

Government had not received notice of this new departure-basis,

later used by t he court. Such lack-of-notice, the Government

contends, violates the rule enunciated in United States v. Burns

,

501 U.S. 129 (1991).

1.

Prior to reaching this contention, we must decide whether the

Government’s objection, including combined with those post-ruling,

is sufficient; that is, whether it presented/described adequately

a lack-of-notice ground. Pankhurst urges that it did not; and that- 28 -

we should, therefore, review only for plain error. S ee United

States v. Hawkins , 87 F.3d 722, 730 (5th Cir. 1992).

The objection to the basis seized by Pankhurst and ultimately

used by the court certainly alerted the court that the sentencing

hearing had moved to new territory for which the Government had not

been given notice. As the court moved to this new territory off

and on during the hearing, both before and after the Government

objected to the new departure-basis when Pankhurst seized upon it,

the Government should hav e better articulated its lack-of-notice

objection, on the assumption that the sentencing court seemed

inclined increasingly to use that basis.

But, surely, the court was aware when it ruled that it was

utilizing a departure-basis sua s ponte , without having given

notice; and that, because of a lack of notice from both the court

and Pankhurst, the Government had not had an opportunity to comment

consistent with Rule 32. Part of the court’s awareness had to come

from the Government’s earlier objection when Pankhurst urged this

same

-- new

-- basis. On this record, the lack-of-notice objection

was sufficient. See United States v. Knight , 76 F.3d 86, 87 (5th

Cir. 1996). Accordingly, we turn to whether notice was required.

2.

Under Burns

, Rule 3 2 requires that, before a district court

may depart upward, the defendant must have notice, either in the

PSR ( see Rule 32(b)(4)(B)), or in a pre-hearing submission by the

Government, or from the court. Our court so held prior to Burns.

See United States v. Otero , 868 F.2d 1412, 1415 (5th Cir. 1989).- 29 -

However, our court has never expanded the holdings in Otero and

Burns to the situation at hand

-- the Government’s not receiving

notice of a possible downward departure.

Nevertheless, at least four other circuits have held that the

rule applies to downward departures. S ee United States v. Alba

,

933 F.2d 1117 (2d Cir. 1991); United States v. Maddox

, 48 F.3d 791

(4th Cir. 1995); United States v. Andruska

, 964 F.2d 640 (7th Cir.

1992); United States v. Green

, 105 F.3d 1321 (9th Cir. 1997).

Apparently, no circuit has held to the contrary . We join those

circuits and hold that notice must be given to the Government

before a district court may depart downward. This result is

mandated by Rule 32, Burns , and Otero

.

Rule 32 states that “the court must afford counsel for the

defendant and for the Government an opportunity to comment on the

probation officer’s determinations and on other matters relating to

the appropriate sente nce....” F E D

. R. C RIM P. 32(c)(1). In other

words, the Rule provides that the Government is due the same notice

as is the defendant.

For this very reason, Burns noted that, for the issue in that

case (pre-upward departure notice to a defendant), it would be

equally appropriate to frame the issue as

whether the parties are entitled to notice

before the district court departs upward or

downward from the Guidelines range. Under

Rule 32, it is clear that the defenda nt and

Government enjoy equal procedural

entitlements.- 30 -

Burns , 501 U.S. at 135 n.4 (emphasis added). Along these lines,

Burns otherwise supports the application of its holding to the

Government, as well as the defendant, for a downward departure.

Burns reasoned (as did Otero , 868 F.2d at 1415) that Rule 32

is intended to achieve focused adversarial development of the

issues pertinent to a particular sentence. 501 U.S. at 135.

Furthermore, the Rule explicitly gives the defendant the right to

comment on a particular departure before it is impos ed; B urns

reasoned that, for this right to be meaningful, it must carry with

it the right to notice of a possible departure. I d. at 136. A s

noted, the Government has the same comment-right; concomitantly, it

must have the same notice-right.

The sentencing hearing for this case offers an excellent

example of why such notice is required, as well as the benefit that

will flow to the sentencing court as a result. The district court

was troubled greatly by the facts at hand and extensively and most

insightfully developed the question. Had the Government, and

Pa nkhurst, been on notice of the new, possible departure-basis,

they could have been of great assistance to the court through the

resulting/subsequent legal research, briefing, and argument.

For example, as stated in the judgment, the court felt that

“the nature of the offense, representing a single, criminal act, is

a mitigating circumstance of a kind, or to a degree, not adequately

taken into consideration by the Sentencing Commission, pursuant to

U.S.S.G. 5K2.0." Had the parties been on notice, they could have

better assisted the court in determining, as a further example,- 31 -

whether “the nature of the offense, representing a single criminal

act” had been considered by the Sentencing Commission in imposing

the § 2C1.1(a) base offense level of 10; the Government urges here

that this base offense level does reflect such consideration.

As another possible aid to the court, the parties could have

explored, or deve loped further, the introductory commentary to

U.S.S.G. § 2C (“Offenses Involving Public Officials”):

The Commission believes that pre-guidelines

sentencing practice did not adequately reflect

the seriousness of public corruption offenses.

Therefore, these guidelines provide for

sentences that are considerably higher than

average pre-guidelines practice.

U.S.S.G. § 2 Pt. C Introductory Commentary.

As yet anothe r example, the extensive commentary to § 2C1.1

might have provided further ground that could have been developed

to assist the court. And, finally, counsel would have been far

more able during the hearing to present and argue the other

relevant portions of the guidelines and the case law.

Accordingly, due to the lack of notice, we must remand the

case to the district court for resentencing, including giving the

Government and Pankhurst notice and an opportunity to respond to,

and otherwise comment on, the noticed possible ground(s) for

departure.

III.

For the foregoing reasons, the conviction is A FFIRMED ; the

sentence is VACATED ; and this case is REMANDED to the district

court for resentencing, consistent with this opinion.

AFFIRMED in PART; VACATED and REMANDED in PART- 32 -

BENAVIDES, Circuit Judge, specially concurring.

I concur in the judgment of the majority affirming appellant’s

conviction and remanding for resentencing.

Appellant contends that the district court abused its

discretion by incorporating in its jury charge the original

indictment. He argues that the indictment should have been

redacted to omit any reference to the government’s theory that he

sought to influence a public official to commit a fra ud upon the

United States. As the majority correctly observes, the proof at

trial focused on the government’s other theory, i.e, that appellant

sought to influence an official act. Compare 18 U.S.C. §

201(b)(1)(A) with id. § 201(b)(1)(B).

Because trial counsel did not object to use of the unredacted

indictment, review is for plain error. F ED

. R. C RIM

. P. 52(b). Even

assuming that it was error to submit the original indictment to the

jury, and that the error was “plain” in the sense of being “clear”

or “obvious,” appellant has demonstrated no effect on his

substantial rights. Cf. United States v. Calverley , 37 F.3d 160,

162-64 (5th Cir. 1994). Accordingly, this first claim fails.

Appellant also argues that the district court erred in its

jury charge by failing to define the “official act” which he

allegedly attempted to influence. The court refused defense

counsel’s request to define the official act for the jury, instead

referring the jury to the unredacted indic tment. Appellant

contends that this was confusing in that the jury may have

concluded that the “official act” was the unspecified and unproven

“fraud” mentioned in the indictment.3 Defense counsel argued to the jury:

They charged that Joe Pankhurst with intent corruptly

gave $10,000 to Ronnie Hooks with the intent to influence

an official act. And here is the official act: To

commit and aid in committing a fraud upon the United

States, that is the acceptance of an offer by the

defendant to purchase a loan being sold to the public by

the Resolution Trust Corporation.

. . . [H]e wasn’t

trying to get to perpetuate a fraud. He was trying to do

a reasonable business deal.

- 33 - Any confusion on this score was invited, if not manufactured,

by defense counsel in his closing argument to the jury. Appellant

complains that the jury charge regarding the “official act” was

“ambiguous and confusing

. . . in light of counsel’s arguments;”

yet it was defense counsel who described the “official act” as the

“fraud” alleged in the indictment. 3 This circuit will not reverse

on the basis of invited error, absent manifest injustice. United

States v. Sanchez

, 988 F.2d 1384, 1392 (5th Cir. 1993). There was

no such injustice in this case. It is clear from the record

evidence and the comments of the district court that the official4 As the district court explained to the jury at the beginning

of the trial:

Mr. Pankhurst is charged with giving a $10,000 payment to

Mr. Hooks to influence Mr. Hooks to sell him the note.

That’s what the case, basically, is about.

- 34 - act which appellant allegedly sought to influence was the RTC’s

sale of the note. 4

Appellant’s sufficiency claims are meritless. Accordingly, I

would affirm appellant’s conviction. However, I would vacate and

remand his sentence for the reasons expressed by the majority. I

therefore concur in the judgment.