REVISED, August 4, 1998

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

____________________________

No. 97-30570

____________________________

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

versus

JOHN E. MILTON, III, also known as Boo Milton,

Defendant-Appellant.

___________________________________________________________________

Appeal from the United States District Court

for the Middle District of Louisiana

_________________________________________________________________ July 21, 1998

Before WIENER, BARKSDALE, and DeMOSS, Circuit Judges.

RHESA HAWKINS BARKSDALE, Circuit Judge:

This appeal presents, once again, application of our plain

error standard of review for a defendant’s failure at sentencing to

object to lack of notice, when the district court utilizes a basis

for upward departure not advanced pre-sen tencing by either the

presentence report, a submission by the Government, or the district

court. Having pleaded guilty to a drug trafficking conspiracy,

John E. Milton, III, challenges his sentence, contending that the

district court erred, inter alia

, (1) by enhancing his sentence for

obstruction of justice for inducing a co-conspirator to sign a

false affidavit; (2) by not giving notice that it would consider2

misrepresentation of assets as a basis for an upward departure; and

(3) by departing upward on that basis. We AFFIRM

.

I.

Between January 1993 and August 1995, Milton participated in

a conspiracy to possess with intent to distribute cocaine. More

than 88 kilograms of powder cocaine and 6.9 kilograms of cocaine

base were trans ported from Houston, Texas, to Baton Rouge,

Louisiana, where it was sold.

In mid-March 1996, Milton and three others were indicted for

that conspiracy, which violated 21 U.S.C. § 846; Milton, also for

three counts of cocaine distribution. A warrant was then issued

for Milton’s arrest.

Although Milton knew he had bee n indicted, he did not

surrender until mid-August. Milton pleaded guilty in October 1996

to the conspiracy count. Pursuant to his plea agreement, the other

counts were dismissed.

The presentence report (PSR) identified factors warranting an

upward departure from the offens e level, including Milton’s

obstruction of justice by hiring lawyers to approach t hree of

Milton’s co-conspirators to sign false affidavits exonerating him.

T wo co-conspirators did so. At a hearing in March 1997, the

district court gave notice of its intent to depart upward, as

detailed below.

At sentencing in April 1997, the district court found that

Milton had asked a co-conspirator to sign a false affidavit

exonerating Milton, and that this was an obstr uction of justice3

which justified the PSR’s recommended two-point enhancement under

U.S.S.G. § 3C1.1, bringing the offense level to 42. The court next

imposed a one-point upward departure, because it found that Milton

had obstructed justic e by failing, during the presentence

investigation, to provide sufficient financial information to the

probation officer. But, the court reconsidered its earlier denial

of the Government’s U.S.S.G. § 5K1.1 motion for a two-level

downward departure, and granted one level. Based on the final

offense level of 42 and criminal history category of I, the

imprisonment range was 360 months to life. Milton was sentenced to

600 months (50 years) imprisonment and fined $250,000.

In addition, the court stated that, if its upward departure

was reversed on appeal, then in the alternative, it would have

imposed a one-level upward departure for any of the three instances

in which Milton solicited others to sign the false affidavits. In

the further alternative, it stated that it would raise Milton’s

criminal history category one level because of his use of “clone”

cellular telephones and his continuing drug dealing w ith the

knowledge he had been indicted.

II.

Milton contests (1) the enhancement for obstruction of justice

for inducing a co-conspirator to sign a false affidavit exonerating

Milton; (2) the lack of notice that misrepresentation of assets

would be considered as a basis for an upward departur e; (3) such

departure for obstruction of justice based on misrepresentation;

and (4) the alternative sentencing bases, claimed to be4

impermissible, lacking in notice, and unwarranted. Because we do

not find reversible error as to the original sentence, we do not

reach the alternative. (Milton also preserves, but in the light of

well-established authority does not argue, his sentencing disparity

issue concerning cocaine base and powder cocaine.)

A.

The obstruction of just ice finding concerning the false

affidavit is reviewed for clear error. U nited States v. Paden

, 908

F.2d 1229, 1236 (5th Cir. 1990), cert. denied

, 498 U.S. 1039

(1991). Along this line, the pertinent Guidelines section,

U.S.S.G. § 3C1.1, provides:

If the defendant willfully obstructed or impeded, or attempted to obstruct or impede,

the administration of justice during the

investigation, prosecution, or sentencing of

the instant offense, increase the offense

level by 2 levels.

And, § 3C1.1 comment 3 states, in pertinent part:

The following is a non-exhaustive list of

examples of the types of conduct to which this

enhancement applies:

(a) threatening, intimidating, or

otherwise unlawfully influencing a codefendant, witness, or juror, directly or indirectly, or attempting to do so;

(b) committing, suborning, or attempting

to suborn perjury;

(c) producing or attempting to produce a

false, altered, or counterfeit document

or record during an official

investigation or judicial proceeding....

Finding that Milton had induced co-conspirator Robertson to

s ign a false affidavit exonerating Milton, the court applied the5

enhancement. Milton claims there was no evidence of any w illful

obstruction of justice: he did not threaten Robertson, and the

affidavit was never used.

The PSR found Milton to be a manager or supervisor in a

conspiracy involving at least five participants. According to the

PSR, attorneys hired by Milton asked three of his co-conspirators

to sign affidavits exonerating Milton from the conspiracy.

Robertson and one other co-conspirator signed such a f fidavits

provided by the attorneys.

At Milton’s sentencing hearing, Robertson testified that,

after his arrest in June 1995, and prior to Milton’s being

indicted, he told Milton, during a telephone conversation, that

anothe r co-conspirator was cooperating with the Government. In

response, Mil ton told Robertson that attorneys would come to the

prison with an affidavit for him to sign, which would state that he

and Milton were never involved in trafficking drugs. The attorneys

brought the affidavit to Robertson, told him that Milton wanted him

to sign it, and Robertson complied. Robertson later testified

falsely at his own trial concerning his involvement with Milton in

the drug conspiracy. During Milton’s sentencing hearing, when

Robertson was asked why he testified falsely and signed a false

affidavit, he replied “to protect myself and to protect Milton”.

As evidenced by Milton’s guilty plea, he knew that, when his

attorney approached Robertson, he (Milton) was involved in a drug

conspiracy; therefore, Milton knew he was asking one of his coconspirators to sign a false affidavit. Milton’s contention that6

the district court failed to give proper consideration to the fact

that the affidavit was not used by Milton is quite disingenuous; if

Milton’s case had gone to trial, the affidavit could have been used

to impeach Robertson, had he chosen to cooperate with the

Government and testify against Milton.

It was not clearly erroneous for the district court to find,

based on the above evidence, that Milton was attempting to obstruct

justice. C f. United States v. Bethley

, 973 F.2d 396, 402 (5th Cir.

1992) (upholding § 3C1.1 obstruction of justice enhancement in part

because a defendant contacted his associate on at least five

occasions to ask her to sign a false affidavit exonerating him,

s tating “I would do it for you”), cert. denied, 507 U .S. 935

(1993).

B.

Regarding whether the district court g ave notice it would

consider concealment of assets as a basis for upward departure, we

must first determine the proper standard of review. As discussed

infra , it is for plain error.

Federal Rule of Criminal Procedure 32(c)(1) provides: “At the

sentencing hearing, 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 sentence”. Our court interpreted this Rule to require

a court to notify counsel of its intent to depart upward and

identify the basis for such possible departure. United States v.

Otero , 868 F.2d 1412 (5th Cir. 1989). The Supreme Court provided7

further guidance in Burns v. United States

, 501 U.S. 129, 138

(1991):

We hold that before a district court can

depart upward on a ground not identified as a

ground for upward departure either in the

[PSR] or in a prehearin g submission by the

Government

, Rule 32 requires that the district

court give the parties reasonable notice that

it is contemplating such a ruling

. T his

notice must specifically identify the ground

on which the district court is contemplating

an upward departure

.

(Emphasis added.) S ee also United States v. Pankhurst

, 118 F.3d

345, 357 (5th Cir.) (“Under Burns

, Rule 32 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.”), cert. denied,

118 S. Ct. 630 (1997).

The holding in Burns was based on the concern that

parties will address possible sua sponte

departures in a random and wasteful way by

trying to anticipate and negate every

conceivable ground on which the district court

might choose to depart on its own initiative.

At worst, and more likely, the parties will

not even try to anticipate such a development;

where neither the [PSR] nor the attorney for

the Government has suggested a ground for

upward departure, defense counsel might be

reluctant to suggest such a possibility to the

district court, even for the purpose of

rebutting it. In every case in which the

parties fail to anticipate an unannounced and

uninvited departure by the district court, a

critical sentencing determination will go

untested by the adversarial process contemplated by Rule 32 and the Guidelines.

501 U.S. at 137.

The PSR, in assessing Milton’s ability to pay a fine, noted:8 Milton’s financial statement is not reflective

of the type of income associated with major

amounts of cocaine distribution. Information

from agents and those associated with him

indicate that many of the houses used in the

conspiracy were placed in the name of other

individuals. This information has not been

verified. A final determination of his worth

cannot be made.

But, this section pertained only to Milton’s ability to pay a fine,

and did not sugge st related collateral matters as a basis for an

upward departure. In fact, the PSR discussed an upward departure

only with respect to the false affidavits and the use of “clone”

cellular telephones while a fugitive from justice.

At the March 1997 hearing, the district court gave the

following notice:

This is what the court is going to do in

this case: the court is goi ng to give notice

of the court’s intent to depart upward in this

case on the basis of [U.S.S.G. § 2D1.1

, concerning the base offense level

determination for, inter alia, drug

trafficking conspiracies] and specifically of

the court’s intent that all the cocaine

i nvolved in this case, both 88.337 kilo s of

powdered cocaine and 6.9 kilos of base

cocaine, be used in connection with any

s entence that might be imposed in this case

. And then specifically, so that everybody will

understand, that if the court uses 1.15 kilos

of base cocaine, that would give the defendant

an offense level of 38 in this case whether or

not there is sufficient other quantity of

cocaine involved in this case such that the

court should depart upward because of the

amount of cocaine involved in this case under

[U.S.S.G § 2D1.1] and specifically Note 17

thereof, which provides, “In an extraordinary

case, an upward departure above offense level

of 38 on the basis of drug quantity may be

warranted.

...9 The court also advises counsel for all

parties of the court’s intent to accept

evidence on the issue of obstruction of

justice on all issues set f orth in the [PSR]

and in addition, obstruction of justice on

whether or not representations made to the

court by the defendant regarding his financial

situation is true and correct, and in

particularity whether or not the defendant has

properly disclosed all vehicles which either

he purchased for himself or others

, including

but not limited to, Rolls Royces, Porches,

Mercedes, and Suburbans, or other such type

vehicles

.

The purpose of that inquiry is to

determine whether or not, under the facts of

this case, a fine should be imposed in

accordance with [U.S.S.G. § 5E1.2, application

note 6], which provides that the existence of

income or assets that the defendant failed to

dis close may justify a larger fine than that

which otherwise would be warranted under [§

5E1.2]. The court may base its conclusion as

to this factor on information revealing

significant unexplained expenditures by the

defendant, or unexplained possession of assets

that do not comport with the defendant’s

reported income. If the court concludes that

the defendant willfully misrepr esented all

[or] part of his income or assets, it may

increase the offense level and the resulting

sentence in accordance with Chapter three,

Part C obstruction

.

...

And finally, ... I want the parties to

strongly either argue this or brief this

issue[:] whether or not there can be and has

been acceptance of responsibility because of

the defendant’s actions in continuing his drug

trade while under indictment and having

knowledge thereof.

And also whether or not those actions and

the amount of drugs i nvolved in the activity

involved in this case is su ch that the court

should consider whether or not to depart

upward because the defendant’s prior criminal

history is not adequately reflected in his

prior and current conduct.10 And I think that satisfies whatever

n otices I need to give to everybody

. And I

think, considering the magnitude of this case

and the fact that this defendant

-- the range, depending on what the offense level could be,

even facing a life sentence

, would be b etter

served.

(Emphasis added.)

As quoted above, the district court gave notice of its intent

to depart upward. But, as for its statement that it would accept

evidence of “obstruction of justice on whether or not

representations made to t he court by the defendant regarding his

financial situation is true and correct, and in particularity

whether or not the defendant has properly disclosed all vehicles

which either he purchased for hi mself or others”, it went on to

sta te only that, “[i]f the court concludes that the defendant

willfully misrepresented all [or] part of his income or assets, it

may increase the offense level and the resulting sent ence in

accordance with Chapter three, Part C obstruction”.

As Milton correctly points out, neither of these s tatements

ab out assets misrepresentation is expressly named as a possible

basis for an upward departure ; rather, they appear to pertain to

the calculation of a fine and to an enhancement under § 3C1.1. The

upward departure notification appears to have been limited to §

2D1.1, concerning the offense level for crimes involving drugs.

1.

At the April sentencing hearing, when the court departed

upward because of the ass ets misrepresentation, Milton’s counsel

did not object to the lack of notice of this possible departure-* The dissent appears to imply that it is improper for us

to apply plain error s ua sponte

, in that the Government did not

contend that Milton’s failure to object mandated such a standard of

review. But, it is more than well-established that

11 basis. At oral argument on appeal, Milton’s counsel (who did not

represent Milton at sentencing) noted that Burns made no mention of

an objection, and stated this suggests one is not required when it

is the court that fails to give notice.

Burns did not address this question. Our court has: if no

objection to lack of notice is made in distri ct court, we review

only for plain error. See United States v. Hawkins , 87 F.3d 722,

730 (5th Cir.) (holding that defendant’s contention, that the

district court’s basis fo r upward departure is ambiguous and not

stated in the PSR, is reviewed only for plain error because

defendant failed at sentencing to object to lack of notice), cert.

denie d, 117 S. Ct. 408 (1996); s ee also United States v. Coenen

,

135 F.3d 938, 940-41 (5th Cir. 1998) (determining, for non-upward

departure sentencing imposition, whether defendant sufficiently

objected to lack of notice before addressing whether notice

required); Pankhurst

, 118 F.3d at 356-57 (determining, for downward

d eparture, whether Government sufficiently objected to lack of

notice before addressing whether notice required).

Milton did not object, move for a continuance, or in any way

indicate that the lack of notice of the basis for the upward

departure had prejudiced him at the sentencing h earing.

Accordingly, we review his lack-of-notice contention only for plain

error. *... no party has the power to control our

standard of review. A reviewing court may

reject both parties’ approach to the standard.

If neither party suggests the appropriate

standard, the reviewing court must determine

the proper standard on its own....

United States v. Vontsteen

, 950 F.2d 1086, 1091 (5th Cir.) (en

banc) (cita tion omitted), c ert. denied

, 505 U.S. 1223 (1992) see

also United States v. Pierre

, 958 F.2d 1304, 1 311 n.1 (5th Cir.

1992) (en banc).

12 2.

As discussed in United States v. Calverley

, 37 F.3d 160, 162-

64 (5th Cir. 1994) (en banc), cert. denied , 513 U.S. 1196 (1995),

we will reverse for plain error if (1) there is error, (2) that is

clear or obvious, and (3) affecting substantial rights. And, even

then, we have discretion to correct such errors; generally, we will

do so only if they “seriously affect the fairness, integrity, or

public reputation of judicial proceedings”. I d

. at 1 64 (quoting

United States v. Atkinson

, 297 U.S. 157, 160 (1936)). S ee Hawkins

,

87 F.3d at 730.

While the district court should have “specifically

identif[ied] the ground on which [it was] contemplating an upward

depart ure”, B urns

, 501 U.S. at 138-39, Milton’s counsel was not

placed in the position of “trying to anticipate and negate every

conceivable ground on which the district court might choose to

depart on its own initiative”. I d. at 137. The purpose behind

notice of upward departure is to give effect to th e Rule 32

requirement that the parties be given “an opportunity to comment

upon the probation officer’s determinat ion and on other matters

relating to the appropria te sentence”. F E D

. R. C RIM

. P. 32(a)(1);13

Burns

, 501 U.S. at 135. Notice of upward departure should be

sufficient to satisfy “Rule 32's purpose of promoti ng focused,

adversarial resolution of the legal and factual issues relevant to

fixing Guidelines sentences”. I d. at 137; Coenen

, 135 F.3d at 943.

There was no reversible p lain error. The district court

provided notice of the “legal [upward departure] and factual

[misrepresentation of assets] issues” upon which it ult imately

based its departure. Therefore, contrary to his assertions on

appeal, and for plain error purposes, Mil ton’s counsel was

s ufficiently on notice to discuss when and how upward departu res

are permitted, as well as the specific facts concerning the assetsmisrepresentation.

C.

Regarding that departure, the factual finding s are reviewed

for clear error; the decision to depart, for abuse of discretion.

E.g., United States v. Ismoila

, 100 F.3d 380, 397 (5th Cir. 1996).

“We will affirm a departure from the Sentencing Guidelines if it is

based on ‘acceptable reasons’ and the degree of depar ture is

‘reasonable’.” U

nited States v. Clements

, 73 F.3d 1330, 1341 (5th

Cir. 1996) (c iting U nited States v. Velasquez-Mercado

, 872 F.2d

632, 637 (5th Cir.), cert. denied , 493 U.S. 866 (1989)).

Under 18 U.S.C. § 3 553(b) and U.S.S.G. § 5K2.0, a court may

depart from the Guidelines when it finds “that there exists an

aggravating or mitigating circumstance of a kind, or to a degree,

not adequate ly taken into consideration by the Sentencing

C ommission in formulating the guidelines that should result i n a14

sentence different from that described”. A court may make a

d eparture, even when the factor is already taken into account

e lsewhere in the Guidelines, “only if the factor is present to a

degree substantially in excess of that which ordinarily is involved

in the offense”. U.S.S.G. § 5K2.0.

Our court has recognized that multiple acts of obstruction of

justice may warrant an upward departure. E.g.

, Ismoila , 100 F.3d

at 397; Clements

, 73 F.3d at 1342. Again, U.S.S.G. § 3C1.1 allows

an enhancement “[i]f the defendant willfully obstructed or impeded,

or attempted to obstruct or impede, the administration of justice

during the investigation, prosecution, or sentencing of the instant

offense”. (Emphasis added.) An example of the type of conduct to

which § 3C1.1 applies is “providing materially false information to

a probation officer in respect to a presentence or other

investigation for the court”. (Emphasis added.) U.S.S.G. § 3C1.1

cmt. 3(h).

The district court departed upward one level becau se Milton

“failed to provide accurate financial information to the probation

officer during the presentence investig ation”. Milton contends

that such undisclosed assets were never shown to have been owned by

him, and, therefore, were not material; and, in the alternative,

that there was no proof of willfulness in his failure to provide

the information.

At the sentencing hearing, co-conspirator Fisher testified

that Milton told him to retrieve Milton’s Porsche from a woman in

Baton Rouge and drive it to Houston. Fisher was arrested en route15

to Houston, and the Porsche was seized by the Government. Milton

had told Fisher that he paid $25,000 for the Porsche. Fisher also

testified that he was present in Houston in 1996 when Milton

purchased a BMW for a female drug-trafficking associate, in lieu of

child support payments.

Fisher testified that he had seen Milton purchase diamond

earrings and a marquis diamond ring. And, when Fisher met with

Milton in Houston, Milton was staying at expensive hotels such as

the Hyatt Regency.

The drug-trafficking conspiracy to which Milton pleaded guilty

involved almost 100 kilograms of cocaine. Robertson, who had been

recei ving cocaine from Milton, testified that he (Robertson) was

mak ing $5,000 to $10,000 profit per kilogram sold. Robertson

stated that he had made approximately $250,000 in the course of the

conspiracy, and had approximately $100,000 at the time of his

arrest.

On the other hand, Milton did not report significant assets to

the probation officer, reporting owning only a $5,000 life

i nsurance policy, a Rolex watch, and two handguns. The total of

his reported assets was $12,700. Milton did not disclose his

interest in the Porsche, the BMW, or the marquis diamond ring.

Obviously, this information was material to the probation

officer’s determination of Milton’s ability to pay a fine; as

stated in the PSR, the officer concluded that “[a] final

determination of [Milton’s] worth cannot be made”. S ee U.S.S.G. §

3C1.1, cmt. 5 (“‘Material’

... information, as used in this16

sec tion, means ... information that, if believed, would tend to

influence or affect the issue under determination.”); United States

v. Dupre

, 117 F.3d 810, 825 (5th Cir. 1997) (“‘A statement to a

probation officer concerning one’s financial resources will

obviously affect the officer’s determination of ability to pay.’”)

(quoting United States v. Cusumano

, 943 F.2d 305, 316 (3d Cir.

1991), cert. denied

, 502 U.S. 1036 (1992)), cert. denied

, 118 S.

Ct. 857 (1998).

Milton contends that the BMW was a gift to his girlfriend in

lieu of child support, and therefore the asset is hers, not his.

However, as Fisher and Robertson testified, it is not unusual for

a drug trafficker to place property in the names of others in order

to avoid seizure. At the very least, if Milton had mentioned these

items, the probation officer would have been in a position to

determine their t rue ownership and, therefore, better determine

Milton’s ability to pay a fine.

Moreover, the large amounts of cocaine sold in the course of

the conspiracy, along with testimony that Milton was seen with

large amounts of cash, justifies the probation officer’s conclusion

that “Milton’s financial statement is not reflective of the type of

income associated with major amounts of cocaine distribution”.

Also noteworthy is Fisher’s testimony that, when Milton was

informed that he had been indicted and told he (Milton) should

consider fleeing to Mexico, Milton responded that he planned to

make “enough money” and then turn himself in.17

The district court noted all of the above evidence in finding

that Milton had willfully obstructed justice by p roviding

materially false information to the probation officer. In the

light of the above evidence, the court was not clearly erroneous in

finding obstruction of justice, and did not abuse its discretion in

upwardly departing one level.

III.

For the foregoing reasons, Milton’s sentence is

AFFIRMED

.18

DeMOSS, Circuit Judge, concurring in part, dissenting in part:

I concur with that part of the majority opinion that affirms

the district court’s imposition of a two-level enhancement for

obstruction of justice pursuant to § 3C1.1.

I must respe ctfully dissent, however, from that part of the

majority opinion that affirms the district court’s imposition of a

one-level departure, which was also imposed for obstruction of

justice. I agree with the majority that B urns v. United States

,

501 U.S. 129, 137-38 (1991), requires a sentencing court to provide

advance notice, specifically identifying the particular ground upon

which it may grant an upward departure. I likewise agree with the

majority’s conclusion that the district court’s notice in this case

fell short of the requirements imposed by Burns

.

I do not agree, h owever, with the majority’s plain error

analysis which sweeps the Burns defect under the rug. The

government never raised Milton’s failure to object as a ground

justifying a heightened standard of review in this case. Thus, the

majority is raising Milton’s failure to object sua sponte, and then

finding the sentencing court’s unfortunate, but nonetheless plain,

failure to adhere to the dictates of Burns excusable. Similarly,

I cannot agree that the government adequately established any

concealment on Milton’s behalf. The Porsche relied upon by the

government had apparently been seized prior to the time that Milton

was interviewed by the probation officer. The balance of the

government’s evidence relies upon speculation concerning the status19

of purported gifts and the fact that Milton , at one time or

another, had considerable assets.

For the foregoing reasons, I would require that Milton’s

sentence be vacated and the cause remanded for resentencing.