2003 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

12-23-2003

USA v. Shotsberger

Precedential or Non-Precedential: Non-Precedential

Docket No. 03-1923

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NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

 

No. 03-1923

 

UNITED STATES OF AMERICA

v.

KERRY DEAN SHOTSBERGER

Appellant

 

Appeal from the United States District Court

for the Middle District of Pennsylvania

(D.C. Criminal Action No. 02-cr-00138)

District Judge: Honorable Sylvia H. Rambo

 

Submitted Under Third Circuit LAR 34.1(a)

October 31, 2003

Before: SCIRICA, Chief Judge, NYGAARD and AMBRO, Circuit Judges

(Opinion filed December 23, 2003)

 

OPINION 

 

AMBRO, Circuit Judge

Kerry Dean Shotsberger appeals a sentence enhancement based on the District

Court’s allegedly unsubstantiated inference that he moved among states for the purpose of
2

evading law enforcement. Shotsberger argues that a court may not infer evasion and

apply the enhancement based merely on the commission of fraud offenses in multiple

jurisdictions. The Government, conversely, contends that the District Court’s decision

was based on a factual finding supported by the record. Because we find that the District

Court’s characterization of its reasoning was at worst harmless error, we affirm.

I. Factual and Procedural History

From November 7, 2001 to March 9, 2002, Shotsberger, his co-defendant Dennis

Stokes, and an unindicted co-conspirator orchestrated a bank fraud scheme in Florida,

Virginia, New Jersey and Pennsylvania. The conspirators produced counterfeit payroll

checks and deposited them in savings and checking accounts at various banks in these

states. They then wrote checks to fictitious individuals, for whom they had false

identification cards, and cashed the checks at branch offices of the banks on which they

were drawn. Over the course of the scheme, the conspirators cashed or attempted to cash

107 checks at nine victim banks, amounting to a total loss of approximately $95,000. 

In March 2002, Shotsberger, Stokes, and Shotsberger’s son, Nathaniel, were

arrested in Camden, New Jersey. Federal Bureau of Investigation (FBI) agents

interviewed all three on March 11, 2002. Nathaniel informed the agents that his father

and Stokes had been involved in counterfeit check schemes since 1993. He also stated

that Shotsberger and Stokes would conduct the bank fraud in a particular area until

“problems” developed, and then would move on to another area.
 

1

In an addendum to the presentence report, the probation officer noted Stokes’s and

Shotsberger’s “extensive criminal histories in Florida for similar misconduct, and a

history of supporting themselves with bad or counterfeit checks,” and reasoned that the

defendants “appear to have left Florida for places where they were unknown” (emphasis

added). The report also relied on Nathaniel Shotsberger’s indication, referred to above in

part, that “his father and Dennis Stokes had participated in counterfeit check schemes for

years, and would commit frauds in a particular area until ‘problems’ developed before

moving on.” 

3

Shotsberger pleaded guilty to one count of bank fraud, in violation of 18 U.S.C.

§ 1334. Prior to sentencing, Shotsberger’s probation officer recommended a two-level

enhancement under U.S.S.G. § 2B1.1(b)(8)(A), which applies to defendants who

“relocated, or participated in relocating, a fraudulent scheme to another jurisdiction to

evade law enforcement or regulatory officials.” The recommendation was based on

“defendant’s apparent relocation of a fraudulent scheme to various jurisdictions to evade

law enforcement” (emphasis added). Shotsberger objected to the enhancement, citing the

lack of evidence indicating that the defendants moved between states for the purpose of

evading law enforcement.1

At the sentencing hearing, the prosecutor responded to Shotsberger’s objection by

arguing that one could make a “reasonable inference” that the defendants had moved

among states in order “to commit crimes and to avoid law enforcement.” The District

Court (per Judge Rambo) granted the enhancement. In so doing, it both purported to

make a factual finding and attributed significance to the Second Circuit’s unpublished

opinion in Warner v. United States, 21 Fed. Appx. 43, 2001 WL 1203066 (2nd Cir.
 

2The appropriate standard of review is subject to dispute in this case. As noted below,

Shotsberger argues that the District Court applied the sentence enhancement based on an

inference. He suggests that we should therefore review the District Court’s ruling de

novo, citing Herskowitz v. Nutri/System, Inc., 857 F.2d 179, 183-84 (3rd Cir. 1988). 

4

2001). Judge Rambo explained: 

I am going to follow the Warner case, plus the facts of this case clearly

show there is an intent to avoid law enforcement. Officials—I don’t

know what—I guess it was Mr. Shotsberger who said that problems

developed before moving on. Whether these problems were that the

banks caught on to them and closed the accounts, or by inference that

they were there long enough that they had to move to avoid

apprehension, I am going to affirm the presentence report in that

enhancement.

Shotsberger’s counsel noted that Nathaniel Shotsberger was not before the Court and was

thus unable “to testify as to what he meant by problems.” She continued, “It is our

position that the reason [the defendants] moved on is because the banks would close their

accounts and not because there was any evidence that they were running from the Police

or thought the Police were on to them.” Additionally, Shotsberger’s counsel clarified that

it was Nathaniel Shotsberger, rather than defendant Kerry Shotsberger, who had made the

statement regarding “problems.” The District Court acknowledged its error but did not

reconsider its decision. Shotsberger was sentenced to 41 months imprisonment, 3 years

supervised release, $45,046.71 in restitution, and a $100 special assessment. He appeals. 

The United States District Court for the Middle District of Pennsylvania had

jurisdiction over the federal criminal prosecution under 18 U.S.C. § 3231. We have

appellate jurisdiction pursuant to 28 U.S.C. § 1291 and 18 U.S.C. § 3742.2
Because we conclude that the District Court applied the enhancement based at least in

part on its factual findings, the relevant standard of review is clear error. See United

States v. Cianscewski, 894 F.2d 74, 82 (3d Cir. 1990) (“[D]etermin[ing] whether the

commission of some particular offense involved more than minimal planning is

essentially factual, and therefore subject only to clearly erroneous review.”). 

5

II. Discussion

We recently decided the issue raised in this appeal in our not-precedential opinion

in United States v. Stokes, 75 Fed. Appx. 888, 2003 WL 22214164 (3d Cir. 2003). In

Stokes, the panel affirmed the sentence imposed by the District Court on Dennis Stokes,

Shotsberger’s co-defendant. The central issue on appeal in that case was whether the

defendants’ travel among states (in other words, the fact that they “bounced back and

forth”) foreclosed a finding that they had left each state to avoid law enforcement. We

held that a finding of evasion was permissible despite the defendants’ unconventional

travel patterns. In addition, we concluded that “the District Court’s finding that the coconspirators moved to evade law enforcement was supported by Nathaniel Shotsberger’s

statement as reported in the Pre-Sentence Report and was not clearly erroneous.” Id. at

892. This latter question—whether the District Court’s application of the sentence

enhancement was supported by the record—is the principal issue raised by Shotsberger on

this appeal.

He asserts that the District Court’s application of the enhancement was based on

an impermissible inference, citing the Court’s intention to rely on Warner. According to

Shotsberger, we should uphold the District Court’s decision only if it meets the standard
 

3

 Similarly, we need not decide the appropriate standard of review for evaluating

allegedly inappropriate inferences. 

 

4The Government suggests that the District Court may not have intended to rely on

Warner at all with respect to its inference holding. Instead, it might have cited Warner, a

case which is remarkably on point, for its holdings that the enhancement applies to

relocation across state borders and in bank fraud cases—issues that Shotsberger raised in

the District Court. 

6

set out in Edward J. Sweeney & Sons, Inc. v. Texaco, 637 F.3d 105, 116 (3d Cir. 1980). 

Sweeney provides, “Inferred factual conclusions based on circumstantial evidence are

permitted only when, and to the extent that, human experience indicates a probability that

certain consequences can and do follow from the basic circumstantial facts.” Id. 

Because we find that Nathaniel Shotsberger’s statement was an alternative,

reasonable basis for the District Court’s decision, we need not decide here whether

Sweeney would otherwise operate to prohibit an inference on these facts.3 The most

appellant-friendly reading of the District Court’s statement is that it identified two bases

for applying the sentence enhancement: first, Nathaniel Shotsberger’s statement, and

secondly, an inference based on the interstate nature of the defendants’ crimes.4 Insofar

as the former, factual finding was a sufficient independent ground of decision, we need

not engage in discussion of the Sweeney standard. 

Shotsberger’s counsel argued at the sentencing proceeding that the word

“problems” in Nathaniel Shotsberger’s statement was insufficiently defined to permit a

factual finding of evasion. She suggested, as already noted, that the defendants had
 

5Additional evidence supported the District Court’s finding of intent to evade. For

example, the defendants staging area was located at a Sheraton Hotel in Wilmington,

Delaware—a state in which none of their crimes was committed—though a hotel in

Cherry Hill or Philadelphia would have been more convenient. 

7

instead “moved on . . . because the banks would close their accounts.” The District Court

did not clearly err in rejecting this position. As the Government noted in its Brief,

“[S]omeone with defendant’s extensive experience in the fraudulent uttering of checks

well knows . . . a bank’s closing of an account involved in fraudulent activity ordinarily

leads immediately to referral of the matter to law enforcement authorities for

investigation.”5

The fact that the Court may have been mistaken as to the issuer of Nathaniel

Shotsberger’s statement at the time of ruling on the objection does not alter our

conclusion. The Court abided by its ruling despite being made aware of its factual error

immediately thereafter. Given that the Court reached an identical decision with respect to

defendant Stokes in the same proceeding—despite unequivocal knowledge that Stokes

did not make the statement—it seems clear that the identity, or lack thereof, of the

speaker and defendant was immaterial to the Court’s factual finding.

III. Conclusion

To the extent that the District Court erred in its identification of the speaker as

Nathaniel rather than Kerry Dean Shotsberger, that error was harmless. Because the

Court did not clearly err in finding that Nathaniel Shotsberger’s statement furnished
8

evidence of the defendant’s intent to evade law enforcement, we affirm Kerry Dean

Shotsberger’s sentence. 

 

TO THE CLERK:

Please file the foregoing Opinion.

By the Court,

/s/ Thomas L. Ambro, Circuit Judge