2003 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit
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### No. 03-1923

UNITED S TATES OF AMERI CA

v. KERRY DEAN SHOTSBERGER Appellant App eal from th e Un ited States District Co urt for the M iddle D istrict of P enns ylvania (D.C. Crimi nal Acti on No. 02-cr- 00138) Distri ct Judge: Honorable Sy lvia H. Rambo 

### Submitted Under Third Circuit LAR 34.1(a)

October 31, 2003 Be for e: S CIR ICA , Chief Judge , NY GA AR D a nd A M BR O, Circuit Judges (Opinion fi led December 23, 2003)

OPI NION

AM BR O, Circuit

Judge Kerry Dean Shotsberger appeals a

sentence enhancement base d on the Dist rict Court’s a llege dly unsubstant iate d infere nce that

he moved among states for the pur pose of2

evading l aw enforcement. Shotsberge r argues that a court maynot infe r evasi on and apply the enha ncem ent ba sed m erely on th e com missio n of fraud offe nses in mu ltiple juri sdictions. The Government, conver sely , cont ends that the Dist rict Court’s de cisi on was based on a factual fi nding supported by t he record. Because we find that the Dist rict Court’ s c har acter iz at io n of it s r eas oni ng wa s a t wo rs t h ar mle ss erro r, we af fi rm. I. Factualand Procedural History From No vem ber 7 , 2001 to M arch 9 , 2002 , Sho tsberg er, his co -defe ndan t Den nis Stokes, and an unindi cted co- conspir ator or chestr ated a bank fr aud scheme in Fl orida, Virg inia, N ew Jersey an d Pe nnsylva nia. T he co nspira tors pro duce d cou nterfe it payroll checks and deposited them in savings and checking accou nts at various banks in these states. They then wrote checks to fictitious individuals, for whom they had false identi fication cards , and cashe d the checks at branc h offices of the banks on which t

hey were drawn . Over the course of the scheme, the conspirators cashed or attempted to cash 107 che cks at nin e vic tim b ank s, am oun ting to a to tal lo ss o f ap pro xim ately $ 95,0 00. In M arch 200 2, Shotsbe rger, Stokes, and Shotsbe rger’s son, N athaniel, were arrested in Ca md en, N ew Jersey. Fe deral B ureau of In vestiga tion (F BI) a gents interviewed allthree on March 11, 2002. Nathani el inf ormed the agent s that

his fat her and Stokes had bee n involved i n counterf eit c heck schemes si nce 1993. He als o stat ed that Sh otsbe rger an d Sto kes w ould cond uct the bank fraud in a pa rticular a rea un til “problems” de veloped, and then would move on to anot her area
.1 In an addendum to t he presentence report, t he probati on officer

noted Stokes ’s and Shotsberge r’s “e xtensi ve crimi nal his tori es in Fl orida for simil ar misconduct , and a hist ory of supporting themsel ves with bad or counterf eit c hecks,” and reasoned t hat the defendants “ appear to hav e left F lorida f or plac es w here th ey wer e unk now n” (em phas is adde d). Th e repo rt also relie d on Na thanie l Sho tsberg er’s ind ication , referre d to ab ove in part, that “ his fat

her and Dennis St okes had participated in c ounterfe it che ck schemes for years, and wo uld com mit frauds in a particular area un til ‘problems’ dev eloped b efore moving on.” 3 Shot sbe rg erpl ead ed g ui lty to one cou ntof b ankfr aud , i n vi ol at io n of 18 U. S. C. § 1334. Pri or to se ntenci ng, Shots berger’ s probation offi cer rec ommended a two-level enhancement under

U.S.S.G. § 2B1. 1(b)(8) (A), which appl ies t o defendants who “reloc ated, o r particip ated in reloca ting, a f raud ulent sc hem e to an other ju risdiction to evade law enforce ment or regul atoryoffici als. ” The recommendation was bas ed on “defendant’s app aren t relocation of a fraudule nt scheme t o various juri sdictions t o evade law enforcement ” (emphasis added). Shot sberger object ed to the enhancement, citi ng the lack of evi dence indi cati ng that t he defendants moved between states for the purpose of evad ing law enfo rcem ent. 1 At the sentencing hearing, t he prosecut or responde d to Shotsbe rger’ s objection by arguing t hat one coul d make a “reasonabl e infer ence” that the defendant s had moved among state s in orde r “to commit crimes and to avoid la w enforcement.” The Distri ct Co urt (pe r Judg e Ra mb o) gra nted th e enh ance men t. In so d oing , it both p urpo rted to make a factualfinding a nd attributed s ignifi cance to t he Second Circui t’s unpubl ished opinion i n Warner v. United State s , 21 Fed. A ppx. 43, 20 01 W L 120 3066 (2 nd C ir.2 The ap pr opriate st an da rd of re vi ew i s s ubj ec t to di sp ut e i n thi s c as e. As n ot ed be lo w, Shotsberge r argues that t he District Court

applie d the sentence enhancement ba sed on an infere nce. He suggest s that we should therefore revi ew the District Court ’s rul ing de novo , ci ting Herskowitz v . Nutri /System, Inc. , 857 F.2 d 17 9, 18 3-8 4 (3 rd C ir. 19 88)
.

4 200 1). Jud ge R amb o exp lained :

I am going to fol low the Warner case, plus th e fac ts of th is case clearly show there i s an int ent to a void law enfor cem ent. Off icials—I d on’t know what

—I gue ss it

was Mr . S hot sbe rg erwho s ai d t hat pr obl ems developed before moving on. Whether thes e prob le ms were that t he banks caught on to them and clos ed the account s, or by i nference t

hat theywere ther e long enou gh th at they ha d to m ove to avoid a ppr ehension, I am going to a ffirm the presentence report in t hat enha ncem ent. Shotsberge r’s couns el note d that Nathaniel Shotsberge r was not befor e the Court and was thus unabl e “to t esti fy as to what he meant by problems. ” She conti nued, “It is our positio n that th e reaso n [the defe ndan ts] mo ved o n is be caus e the b anks wo uld clo se their accounts a nd not because there was any evidence t

hat the y were running from the Police or thought

the Poli ce were on to them.” Additi onally , Shots berger’ s counsel clari fied that it was Nathani el Shots berger, rather than defendant

Kerry Shotsberge r, who had made the stat ement regar ding “probl ems.” The Dist rict Court acknowledged i ts er ror but did not reconsider its dec ision. Shotsberg er was se ntenced to 41 m onths imp risonmen t, 3 years sup erv ised relea se, $ 45,0 46.7 1 in restitu tion , and a $1 00 s pec ial as sess me nt. H e ap pea ls. The United States District Court for the Middl e District of Pennsyl vania had juri sdiction over t

he federalcrimina l prose cution unde r 18 U.S.C. § 3231. We have appell ate j urisdi ction pur suant t o 28 U.S.C. § 1291 and 18 U.S. C. § 3742. 2Bec ause we conc lude th at the D istrict Co urt app lied the enha ncem ent ba sed a t least in

par t on its fa ctua l find ing s, the relev ant s tand ard of r evie w is clea r erro r. See United States v. Ciansc ewski , 894 F.2d 74, 82 (3d Cir. 1990) (“[D]et ermin[i ng] whether t he com missio n of som e partic ular of fens e invo lved m ore tha n m inima l plann ing is esse ntial ly fact ual, a nd t her efo re su bjec t on ly to cle arly err one ous rev iew .”). 5 II. Dis cussion We recently

decided the issue rais ed in thi s appeal i n our not- precedential opi nion in United Stat

es v. St okes , 75 Fed. A ppx. 888 , 2003 W L 222 14164 (3d Cir. 200 3). In Stokes , the panel affirmed the sentence imposed by the District Court on Dennis Stokes, Shotsberge r’s co- defendant. The centralissue on appeal i n that c ase was whether t he defe ndan ts’ travel among stat es (i n other words, the fact that t hey “bounc ed back and fo r t h” ) fo r ec l os ed a f

i nd i ng t ha t t he y ha d l ef

t ea ch st ate t o a vo i d l aw en fo r ce me nt . We held that a fi nding of evasi on was permissi ble despi te the defendants ’ unconventi onal travelpatte rns. In addition, we concl uded that “the Dist

rict Court’s f

inding t hat the coconspirators m oved to e vade law enforce ment w as suppo rted by Nathan iel Shotsberge r’s stat ement as re ported i n the Pre- Sentence Report and was not cle arlyerroneous .” Id . at 892. This l atte r question—whether the Dist rict Court’s application of t he sentenc e enhancement was supported bythe rec ord—is the pri ncipal issue r aised byShotsberge r on this app eal. He assert s that

the Dist rict Court’s application of t he enhancement was base d on an impermis sibl e infer ence, ci ting t he Court’s intent

ion to r elyon Warner . Acc ordin g to Shotsbe rger, we sh ould up hold the D istrict Court’s decision on ly if it meets the stan dard3 Similarly , we need not deci de the appr opriate standard of revie w for evaluating

alleg edly in app rop riate infe ren ces . 4 The Government suggest s that the Dist rict Court may not

have int ended to re ly on Warner at al l with r espect to its infere nce holdi ng. Ins tead, it mi ght have ci ted Warner , a case w hich is r ema rkab ly on po int, for its h olding s that the enha ncem ent ap plies to reloca tion ac ross sta te bord ers an d in b ank f raud cases
— issues th at Sh otsbe rger ra ised in the D istrict Co urt. 6 set out in Edward J. Sweeney & Sons, Inc. v. Texaco , 637 F.3 d 10 5, 11 6 (3 d C ir. 19 80)
. Sweeney provides, “Inf erred factua l conclusions b ased on circumstan tial evidence are permitted onlywhen, and to the extent that, human experience indicates a pr obabili ty that certa in consequenc es can and do fol low from the basi c circ umstanti al fact s.” Id
.

Because we find that

NathanielShotsberge r’s s tate ment was an alt ernati ve, reasonabl e basis for the Dis tri ct Court’ s decis ion, we need not decide her e whether Sweeney would otherwise operate to prohibit an inference on these facts. 3 The mo st appell ant-friendly

reading of

the Dist rict Court’s s tate ment is t

hat it identi fied t wo bases for applying the s entence enha ncement: first, NathanielShotsberge r’s s tate ment, and secondly, an i nference based on the interstate nat ure of the defendants’ crimes. 4 Insofar as the former, fact

ual fi nding was a suffi cient independent

ground of deci sion, we need not engage i n discuss ion of the Sweeney stan dar d. Shotsbe rger’s coun sel argued a t the sentencing proceed ing that the w ord “pro blem s” in N athan iel Sho tsberg er’s state men t was insuf ficien tly defined to perm it a factualfinding of

evasion. She suggeste d, as already noted, that t he defendants had5 Additionalevidence s upported t he District Court ’s fi nding of intent to e vade. For example, t

he defendants stagi ng area was loc ated at a Sheraton Hote l in Wil mington, De lawa re— a state in wh ich no ne of their crim es w as co mm itted— thou gh a h otel in Ch erry H ill or P hilad elph ia w oul d ha ve b een mo re co nve nien t. 7 instead “m oved o n . . . because the b anks w ould close the ir accounts.” T he D istrict Court did not cl early

err i n rejec ting t

his posi tion. As the Government note d in it s Brief, “[S]omeone with defendant’s e xtensi ve experi ence in the fraudul ent uttering of c hecks

we ll know s . . . a ban k’s clo sing o f an a ccou nt invo lved in fraud ulent a ctivity ordin arily leads i mmediatel y t o referr al of the matter to law enfor cement authoriti es for inv estig ation .” 5 The fact that theCourt may ha ve been mist aken as to t he issue r of Nathani el Shotsberge r’s s tate ment at t he time of r

uling on t

he objection does not

alte r our conclusi on. The Court abi ded by i ts rul ing despi te bei ng made aware of it s factua l err or imm ediate ly thereafte r. Giv en tha t the C ourt re ache d an id entica l decisio n w ith resp ect to defendant St okes in t

he same proceeding —despite unequivoca l knowledge that Stokes did not make the st atement—it se ems clear that t he identity , or l ack ther eof, of the speaker and de fendant was i mmaterialto the Court ’s fact ual fi nding. III. Conclusion To the extent

that t he District Court

erred i n its identi fication of the speaker as Nathanielrather

than KerryDean Shotsberger , that err or was harmles s. Because t he Court did not

clear ly err i n finding t

hat Nathani el Shots berger’ s statement furni shed8

evidence of t

he defendant’ s int ent to e vade law enforcement , we affirm Kerry Dean Sh otsb erg er’s s ente nce .

TO THE C LERK: Please fi le the foregoing Opini on.

By the C ourt,

/s/ Thomas L. Ambro, Circui t Judge