### 1998 D e c i sion s O p inion s of the U nit e d

S t a t e s C our t of Appe al s for the Thir d C ir c uit

4-29-1998 

# U nit ed S t a t es v

. F a ul k s

P r e c e de n t i al or N on-P r e c e de n t i al :

D ock e t 96-2056

F o l lo w thi s a nd a dd it ion al w ork s a t : h tt p://d i g it alc ommon s .l a w

. v i l l a no v a

. e du/thir dc ir c uit_1998

Thi s de c i sion i s br ou gh t t o y ou for f r e e a nd ope n a c c e s s b y the O p inion s of the U nit e d S t a t e s C our t of Appe al s for the Thir d C ir c uit a t V i l l a no v a

U niv e r sit y S choo l of L a

w Di g it al R e posit or y

. I t h as be e n a c c e pt e d for inclusion in 1998 D e c i sion s b y a n a uthor i z e d a dmini s tr a t or of V i l l a no v a

U niv e r sit y S choo l of L a

w Di g it al R e posit or y

. F or mor e infor m a t ion, p le as e c on t a ct Be n j a min

. C a rl s on@l a

w

. v i l l a no v a

. e du

. 

### R e c omme nde d C it a t ion

" U nit e d S t a t e s v

. F a ul k s " (1998). 1998 D e cisio n s

. P a pe r 96.
h tt p://d i g it alc ommon s .l a

w

. v i l l a no v a

. e du/thir dc ir c uit_1998/96Filed April 29, 1998

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

NO. 96-2056

UNITED STATES OF AMERICA

v.

JUAN FAULKS Appellant

On Appeal From the United States District Court For the Eastern District of Pennsylvania (D.C. Crim. Action No. 96-cr-00299-1)

Argued October 17, 1997

BEFORE: STAPLETON, ALITO and SEITZ, Circuit Judges

(Opinion Filed April 29, 1998)

Michael R. Stiles United States Attorney Walter S. Batty, Jr. Assistant U.S. Attorney Wendy A. Kelly (Argued) Assistant U.S. Attorney Office of United States Attorney 615 Chestnut Street, Suite 1250 Philadelphia, PA 19106 Attorneys for AppelleePeter Goldberger (Argued)

Pamela A. Wilk James H. Feldman, Jr.
50 Rittenhouse Place Ardmore, PA 19003-2276 Attorneys for Appellant

OPINION OF THE COURT

STAPLETON, Circuit Judge:

Defendant Juan Faulks entered into a plea agreement with the government which required him to cooperate in the investigation of individuals participating in the d istribution of narcotics. In return for Faulks' assistance, the government agreed to file a motion pursuant to U.S. S.G. S 5K1.1 requesting a downward departure from the Sentencing Guidelines. Faulks asserts that the dist rict court misapplied the Sentencing Guidelines because it granted the government's motion but, nevertheless, imposed a sentence within the applicable guideline range. Faulks also contends that the district court erred in declining to depart pursuant to U.S.S.G. S 5K2.0 ba sed on his agreement not to oppose certain administrative forfeitures. Finally, Faulks submits that the distr ict court erred in finding that the controlled substance he
distributed was crack cocaine.

We will remand for further sentencing proceedings.

I.

On two occasions in 1996, Faulks sold approximately
eleven and one half ounces of cocaine base to a con fidential informant. He was later arrested and charged with t wo counts of distributing a "substance containing coca ine base (crack)" in violation of 21 U.S.C. S 841(a)(1), two counts of money laundering in violation of 18 U.S.C. S 1956, one count of criminal forfeiture of real property pursu ant to 18 U.S.C. S 982, and four counts of criminal forfeitur e of personal property pursuant to 21 U.S.C. S 853. App. at 8-9.

2Faulks entered into a plea agreement which required him

to plead guilty to the counts of cocaine distributi on, money laundering and criminal forfeiture of real property . The government agreed to dismiss the remaining counts o f criminal forfeiture in return for Faulks' acquiesce nce in the administrative forfeiture of the personal property described
in the indictment. It also committed itself to:

[m]ake a motion to allow the Court to depart from the Sentencing Guidelines pursuant to Sentencing Guidelines S 5K1.1, and to impose a sentence below any mandatory minimum term of imprisonment pursuant to 18 U.S.C. S 3553(e), if the gove rnment, in its sole discretion, determines that the def endant has provided substantial assistance in the inves tigation or prosecution of another person who has commit ted an

offense.

App. at 36-37.

When Faulks entered his guilty pleas, the court ask ed him at the outset to identify the charges to which he wished to plead guilty. He responded, "Two counts o f distribution of crack cocaine, and forfeiture of my home, and to money laundering." App. at 45. Thereafter, t he government made a proffer of evidence during which the prosecutor consistently and on six occasions referr ed to the substance distributed by Faulks as "crack cocaine." She reported during the proffer that the substance purc hased by the informant on both occasions was tested by th e DEA lab and determined to be "crack cocaine base." App. at 49- 50. After the proffer, with one exception not here relevant, both Faulks and his counsel expressly confirmed tha t the government's version of the facts was substantially correct.

The Presentence Investigation Report ("PSI") calcul ated the guideline range to be 87 to 108 months. This
calculation assumed that the substance distributed was crack cocaine and that Faulks was entitled to escap e the ten-year mandatory minimum provisions of 21 U.S.C. S 841(b)(1)(A) under the safety valve provisions of U.S.S.G. S 5C1.2. Neither side objected to the calculation o f the guideline range in the PSI.

3Prior to the sentencing hearing, the government fil ed a

"Motion for Downward Sentencing Departure Pursuant to Section 5K1.1." App. at 54. This motion characteriz es the government's obligation under the plea agreement as one "to permit the Court to depart downward from the applicable Sentencing Guidelines range." Id. The mo tion represented to the court that Faulks had provided t he government with substantial assistance in the prose cution of other persons.

At the sentencing hearing, Faulks' counsel argued f or a downward departure based on his agreement not to co ntest
the administrative forfeitures. He insisted that th is was meaningful because "[s]ome of these items, for exam ple, diamond rings and such, were purchased before this indictment occurred or before his drug activity occ urred." App. at 58-59. Although the prosecutor acknowledged that
Faulks had "consented to the forfeiture of these it ems administratively," she, inexplicably, agreed with t he court
when it advised Faulks that he could still contest the forfeitures if he chose to do so. App. at 59. The c ourt did not explain the basis for this advice. It denied th e requested downward departure on the ground that Faulks could still contest the forfeitures and therefore had given up nothing.

Thereafter, the prosecutor called upon the court to grant the S 5K1.1 motion. Almost immediately thereafter s he was asked to advise the court what sentence the governm ent was recommending. She replied that the government w as "recommending a minimal departure . . . in the uppe r range of the guideline," because Faulks had opportunities to provide "significant information" but chose not to do so. App. at 66, 71. Faulks' counsel objected and called upon the court "to depart from the 87 months, a downward departure, because then the 5K1.1 is meaningful." A pp. at
70. The district court sentenced Faulks to 95 month s of imprisonment. Shortly thereafter, it entered an ord er reflecting that it had granted the government'sS 5K 1.1 motion to depart. In its "Statement of Reasons" for its judgment, the court checked a box indicating that i ts "sentence departs from the guideline range upon mot ion of the government, as a result of defendant's substant ial assistance," but then inserted by hand, "However, s entence is within guideline range." Addendum to Appellant's Brief.

4II.

As Faulks stresses, there is an inconsistency betwe en what the district court said and what it did. The d epartures provided for in Part K of the Guidelines Manual are departures from "the range established by the appli cable guideline." E.g. U.S.S.G. S 5K2.0 Grounds for Depar ture (policy Statement). Thus, when U.S.S.G. S 5K1.1 pro vides that "[u]pon motion of the government stating that the defendant has provided substantial assistance . . . the court may depart from the guidelines," it is author izing the court to impose a sentence less than the range of s entences
to which the Guidelines would otherwise limit the c ourt's discretion. As the government acknowledged in its S 5K1.1 motion, a motion under that section is, accordingly
, intended "to permit the Court to depart downward fr om the applicable Sentencing Guidelines range." App. at 54 . This fact is also reflected in the printed judgment form utilized by the district court which characterizes a departu re as a "sentence [that] departs from the guideline range." Addendum to Appellant's Brief.

It follows that when someone is promised the possib ility of "a departure from the guidelines" under U.S.S.G. S 5K1.1, he or she may reasonably expect to be affo rded the possibility of a sentence below the guideline range . It is thus important that United States Attorneys and dis trict courts not use the term "departure" loosely. We are not confronted, however, with a claim that Faulks was m isled by anyone to his detriment. He does not claim, for example, that the government failed to file a motion that he reasonably believed it would file as a result of th e plea agreement.1

What we are confronted with is an argument that a sentencing judge who has granted a S 5K1.1 motion i s powerless to impose a sentence within the guideline range.

___________________________________________________ ______________

1. While it is true that the prosecutor, afterfilin g the S 5K1.1 motion, recommended a sentence in the "upper range of the g uideline" the Plea Agreement reserves to the government the right to " make whatever sentencing recommendation [it] deems appropriate." We are not called upon here, however, to determine whether the govern ment's conduct was consistent with the Plea Agreement and we do not.

5We conclude that this claim should be rejected wher e, as

here, the record provides assurance that the senten cing judge recognized his authority to depart below the guideline range and there is no ambiguity about the intended

sentence.

The initial issue in our analysis is whether a dist rict court, in the absence of a S 5K1.1 motion, may cons ider the defendant's assistance to the government in decidin g where to sentence within the guideline range. We believe the answer must be "yes." Congress directed the Commiss ion to "assure that the guidelines reflect the general appropriateness of imposing a lower sentence than w ould otherwise be imposed . . . to take into account a defendant's substantial assistance in the investiga tion or prosecution of another person who has committed an offense." 28 U.S.C. S 994(n). While this directive has been partially implemented by the S 5K1.1 departure auth ority, we are confident that neither Congress nor the Comm ission considered what was "generally appropriate" to be inappropriate when a sentencing judge is exercising discretion within the guideline range. To the contr ary, we find consideration of substantial assistance for th is purpose entirely consistent with the authority bestowed on sentencing judges. As the Second Circuit Court of A ppeals observed in United States v. Huerta, 878 F.2d 89, 9 3 (2d Cir. 1989):

[The authorizing statute and the Guidelines do] not foreclose a sentencing court from considerin g a defendant's cooperation as a mitigating fact or in deciding what sentence within the applicable range designated by the Guidelines is appropriate, whether or not the government agrees. . . . Under the G uidelines, courts may weigh a wide array of factors, 18 U.S.C. S 3661, including "the nature and circumstan ces of the offense and the history and characteristics of the defendant," 18 U.S.C. S 3553(a)(1), to arriv e at a sentence that "reflect[s] the seriousness of the offense, [ ] promote[s] respect for the law, and [ ] provide[s] just punishment for the offense[.]" 18 U.S.C.S 35 53(a)(2)(A). We perceive no reason why a defendant's coop eration is not a relevant factor in applying those stan dards.

6Having resolved this threshold issue, we proceed to

inquire whether the authority to consider substanti al assistance in sentencing within the guidelines is a ffected in any way by the filing of a S 5K1.1 motion. The answ er, of course, must be "no." Under the Guidelines, the sen tencing court is free to deny the motion and sentence as it would
have done in its absence. If the court believes it has given sufficient credit for the substantial assistance by moving down in the range, nothing we perceive in the Guide lines precludes it from avoiding undeserved credit by den ying the government's motion. Thus, the district court in th is case could have, quite properly, denied the motion for a departure and then gone on to acknowledge Faulks' substantial assistance by sentencing lower in the g uideline range than it would otherwise have done. In the int erest of avoiding possible misunderstanding in the future, w e suggest that this is the preferable way to achieve the result that the district court clearly sought here. This c onclusion does not, however, provide an answer to the argumen t that
Faulks here advances based on the fact that the dis trict court granted, rather than denied, the motion to de part.

The final step is to determine whether a sentencing court may grant a S 5K1.1 motion for a downward departure and nevertheless impose a sentence within the otherwise applicable guideline range. We conclude that the di strict court's statement that it was granting a departure should be regarded as harmless error, and we hold that it, accordingly, does not mandate a sentence below the guideline range. The record makes clear both that t he district court was aware of its discretion to depar t below the guideline range based on Faulks' substantial assist ance and that, in its discretion, that assistance did no t warrant a sentence below that range. Since, as we have demonstrated, the district court was authorized to impose the sentence that it in fact imposed, its judgment should not be disturbed. Cf. United States v. Baird, 109 F .3d 856 (3d Cir.), cert. denied, 118 S. Ct. 243 (1997).

Situations may undoubtedly arise in which an inconsistency between granting a S 5K1.1 motion and a sentence within the guideline range will raise ques tions about whether the defendant was misled, whether the judge

7understood that he had authority to depart, what se ntence

the judge actually intended, or whether the judge w as otherwise confused. But this is not such a case. Fa ulks was told that he would receive a sentence for his coope ration below the guideline range only if the court found t hat appropriate and the court clearly did not. Contrary to Faulks' suggestion, there is nothing unclear or amb iguous

about the court's 95 month sentence or about whethe r it was the sentence the court intended to impose. The court listened at great length to both sides' view of the value of Faulks' assistance and clearly decided that it woul d warrant an in-range reduction but not a sentence be low the guideline range. Under these circumstances, we will not disturb the resulting sentence on this ground.2

III.

At sentencing, Faulks asked for a departure pursuan t to U.S.S.G. S 5K2.0 based on his agreement not to cont est certain administrative forfeitures. The Policy Stat ement of S 5K2.0 provides that:

Under 18 U.S.C. S 3553(b), the sentencing co urt may impose a sentence outside the range establis hed by the

___________________________________________________ ______________

2. While the terminology chosen in S 5K1.1 suggests that a sentencing court is to calculate the applicable guideline rang e and then decide whether and how far to go below it, we note that at least two courts have adopted a different methodology. In United States v . King, 53 F.3d 589 (3d Cir. 1995), and United States v. Hill, 70 F.3d. 321 (4th Cir. 1995),
the district courts determined the total offense le vel, reduced the total offense level by a number of levels determined to b e appropriate in light of the substantial assistance, and then calculated a guideline range using the reduced offense level. We had no occasion to pass judgment on this aspect of the district court's sentencing in K ing. We did suggest in United States v. Kikumura, 918 F.2d 1084 (3d Cir. 1 990), however, that it is helpful in determining the extent of upward d epartures for sentencing courts to think in terms of the ranges t hat would be produced by using analogous offense level enhanceme nts. Nevertheless, we do not read Kikumura to imply that it is imprope r in applying S 5K1.1 for a district court to calculate the otherwise app licable guideline range and then make an appropriate reduction in the numbe r of months to be served based on its appraisal of the value of the d efendant's substantial
assistance.

8applicable guideline, if the court finds "th at there exists

an aggravating or mitigating circumstance of a kind, or to a degree, not adequately taken into consi deration by the Sentencing Commission in formulating the guidelines that should result in a sentence different
from that described."

We have held that exposure to forfeiture is not a g round for departure under S 5K2.0 because "the Commission considered forfeiture when creating the guideline r ange for terms of imprisonment." United States v. Shirk, 981 F.2d 1382, 1397 (3d Cir. 1992). Faulks does not argue, h owever, that his exposure to forfeiture should entitle him to a downward departure. His contention, rather, is that his voluntary surrender of meritorious defenses to forf eiture should entitle him to a departure. In his view, as we understand it, this voluntary surrender evidences extraordinary contrition and acceptance of responsi bility.

While Faulks acknowledges that he has received a th ree level decrease for acceptance of responsibility und er U.S.S.G. S 3E1.1, he points out that in United Stat es v. Lieberman, 971 F2.d 989 (3d Cir. 1992), we approved a downward departure for extraordinary acceptance of responsibility even though a two level decrease had been granted under U.S.S.G. S 3E1.1. Faulks stresses tha t the downward departure in that case was justified in pa rt by the fact that the defendant had agreed to pay more
restitution than he believed he owed.

Two other courts of appeals have held that the circumstances surrounding a payment of restitution may demonstrate an extraordinary degree of acceptance o f responsibility, thus justifying a departure. In bot h instances, however, the court indicated that the me re payment of restitution or mandated forfeitures cann ot, in and of itself, be the basis for departing from the Guidelines. See United States v. Hendrickson, 22 F.3d 170 (7th Cir. 1994); United States v. Crook, 9 F.3d 1422, 1426 (9 th Cir. 1993). We agree. As the Hendrickson court put it, " [p]rompt payment of [a] forfeited amount does not transform forfeiture into a ground for departure from the gui delines." Hendrickson, 22 F.3d at 176 n.6.

9We do not read either Hendrickson or Crook to hold,

however, that a voluntary surrender of meritorious defenses to forfeiture can never evidence an extraordinary acceptance of responsibility, and we decline to so hold.
Where it can be established that meritorious defens es have indeed been foregone under circumstances that refle ct an extraordinary sense of contrition and desire to mak e amends for the offense, we see no basis for disting uishing our holding in Lieberman regarding the voluntary pa yment of restitution not thought to be owed.

In this case, Faulks' counsel was not given an opportunity to build a record in support of his app lication for a departure for extraordinary acceptance of responsibility because of the court's unexplained conclusion that the plea agreement did not foreclos e Faulks from contesting the civil forfeiture. It may well b e that the prosecutor's affirmance of the court's conclusion n ow estops the government from relying on Faulks' waive r of his alleged defenses. But that seems to us irrelevant t o the issue of whether Faulks' willingness to enter the a greement in the first place evidences an extraordinary accep tance of responsibility on his part.

We conclude that Faulks should be given a fair opportunity to support his application for a downwa rd departure for extraordinary acceptance of responsib ility. By so concluding, we express no view about whether he will be able to make the required showing. On the surface, at least, this does not appear to be an extraordinary situati on. But that is a judgment for the district court to make b ased on the best record that Faulks can provide.

Nor does our conclusion here condemn sentencing jud ges to try forfeiture actions in the course of their se ntencing hearings. Given that the defendant must demonstrate a truly extraordinary situation in order to be entitl ed to a downward departure for extraordinary acceptance of responsibility, we would expect there to be very fe w cases in which an application for a departure on this ground cannot be disposed of on the basis of a proffer by the def endant.

IV.

The indictment charged Faulks with distributing cra ck. It is clear from the transcript of the plea-taking pro ceedings

10that he understood this and that his plea was volun tary. A

knowing and voluntary plea constitutes an admission of all material facts alleged in the indictment, even wher e those
facts are not essential elements of the offense cha rged. See United States v. Dickler, 64 F.3d 818, 823 n.7 (3d Cir. 1995); United States v. Parker, 874 F.2d 174 (3d Ci r. 1989).
There was a further admission that the substance distributed was crack when Faulks agreed with the government's account of the factual basis for the p lea. These admissions provide ample evidentiary support for the district court's finding on the subject. See United States v. Powell, 113 F.3d 464, 470 (3d Cir. 1997).

V.

The judgment of the district court will be reversed , and this case will be remanded for further proceedings on Faulks' application for a downward departure under

U.S.S.G. S 5K2.0.3

A True Copy:

Teste:

Clerk of the United States Court of Appeals
for the Third Circuit

___________________________________________________ ______________

3. Our review of the record reveals no basis for re quiring that subsequent proceedings in this case be conducted by a different district judge. Faulks' request that we do so is, accordingl y, denied.

11