Source: http://nj.findacase.com/research/wfrmDocViewer.aspx/xq/fac.19920925_0040382.C03.htm/qx
Timestamp: 2016-10-28 20:02:06
Document Index: 121673924

Matched Legal Cases: ['§ 5', '§ 5', '§ 371', '§ 666', '§ 7201', '§ 1291', '§ 3742', '§ 994', '§ 5', '§ 5', '§ 5', '§ 10601', '§ 10602', '§ 3553', '§ 3572', '§ 3553', '§ 7301', '§ 4007', '§ 3553', '§ 3572']

| U.S. v. Spiropoulos
U.S. v. Spiropoulos
filed: September 25, 1992; As Corrected September 28, 1992. Second Correction October 22, 1992. Third Correction December 14, 1992.
UNITED STATES OF AMERICA, APPELLEEv.RENE SPIROPOULOS, APPELLANT
On Appeal From the United States District Court For the District of New Jersey. (D.C. Crim. No. 90-00273)
Defendant Rene Spiropoulos entered into a plea agreement with the government that required him to cooperate in the investigation of individuals who had committed offenses related to his. The Agreement obligated the government, in exchange, to file a motion pursuant to USSG § 5K1.1, requesting a downward departure from the Guidelines sentencing range based on Spiropoulos's good-faith effort to assist the government. After Spiropoulos fulfilled his obligations under the Plea Agreement, the government moved for a downward departure pursuant to section 5K1.1. The district court granted the motion but tempered the extent of the requested downward departure because, by mere happenstance, the defendant's cooperation bore considerably less fruit than had been expected. The first question we must answer is whether the fruitlessness of a defendant's good-faith cooperation constitutes a legally permissible consideration in determining the amount of downward departure under section 5K1.1. We conclude that it does.
Finally, the district court directed Spiropoulos to pay a fine based in part on the cost of his imprisonment as provided for in USSG § 5E1.2(i). Spiropoulos contends that requiring a defendant to pay the costs of his imprisonment is not authorized by the Sentencing Reform Act and is inconsistent with the Due Process Clause of the Fifth Amendment. Spiropoulos's contentions raise a number of intricate and difficult questions of construction and application of the Act, which we will discuss at length. Because we believe that the assessment of fines under section 5E1.2(i) is inconsistent with the Act as presently drafted, we will invalidate section 5E1.2(i) and vacate that portion of the fine against Spiropoulos, leaving it to Congress to make provision for such fines if it so desires.
After the government had uncovered the bribery scheme, Spiropoulos entered into the Plea Agreement, in which the government promised to move for a downward departure pursuant to section 5K1.1 in exchange for Spiropoulos's cooperation. Additionally, Spiropoulos pled guilty to two counts of conspiracy, see 18 USCA § 371 (West, 1966 and 1992 Supp): 1) conspiracy to violate 18 USCA § 666 (West, 1992 Supp) by the payment of bribes; and 2) conspiracy to violate 26 USCA § 7201 (West, 1989 and 1992 Supp) by enabling the mayor to evade income taxes due on those bribes. Spiropoulos cooperated both by providing the government with information and by participating in the investigation. Specifically, Spiropoulos wore a "wire" on three occasions to monitor his meetings with others involved in the scheme, including a meeting with Boswell. The wire recorded Boswell's statements acknowledging that he had solicited bribes on behalf of the mayor. After listening to the tape, an FBI agent told Spiropoulos that he had "hit a homerun."
At sentencing, Spiropoulos's counsel maintained that the degree of downward departure must be gauged by what defendant did to assist the government and not by whether, for reasons beyond his control, the government successfully prosecuted others based on information he had given them.*fn1 Counsel also stressed that Spiropoulos had sought nothing from the bribes, but rather was paying for that to which he was lawfully entitled. Based on these arguments, defense counsel contended that Spiropoulos was entitled to avoid imprisonment completely and recommended that he be sentenced to probation.
Spiropoulos now appeals from the judgment. We have appellate jurisdiction under 28 USCA § 1291 (West, 1966 and West Supp 1992) and 18 USCA § 3742(a) (West, 1985 and 1992 Supp).
Spiropoulos contends that the district court applied an improper legal standard in determining the degree of downward departure when it imposed a harsher sentence on him than it would have imposed had Boswell's death not caused the investigation to cease. He submits that the Sentencing Reform Act, the Guidelines, and the Plea Agreement all make clear that downward departures based on substantial assistance should be gauged by whether defendant made a good-faith effort to provide substantial assistance to the government, and not by whether that cooperation resulted in the successful prosecution of others.*fn2 Spiropoulos urges that altering the amount of the departure based on the success of subsequent prosecutions is, therefore, inconsistent with the Act, the Guidelines, and the Plea Agreement.
28 USCA § 994(n) (West, 1992 Supp).
In response to the statutory command of section 994 (n), the Sentencing Commission promulgated USSG § 5K1.1. In its 1987 form, which applies to the sentencing of Spiropoulos,*fn3 the Commission provided the following system for calculating downward departures based on substantial assistance:
We reject Spiropoulos's contention as inconsistent with the Act and the Guidelines. As we have suggested, the Act makes clear that the Commission should define the specific method for determining the extent of a departure below the minimum sentence. The Guidelines, in turn, specify that a sentencing court, in determining the extent of a downward departure, may consider its evaluation of "the significance and usefulness of the defendant's assistance, taking into consideration the government's evaluation of the assistance rendered . . . . " USSG § 5K1.1. That section therefore makes crystal clear that, in determining the extent of a substantial assistance departure, a court should examine the "usefulness" of the defendant's cooperation. Obviously, a defendant's assistance is generally more "useful" if it leads to a conviction than if the government never uses the information once it is acquired.
We do not believe that the government breached the Plea Agreement when it mentioned in its motion under section 5K1.1 of the Guidelines that the defendant's cooperation had not ultimately been useful. We note at the outset that the Agreement did no more than to require the government to make a section 5K1.1 motion, which it did. Specifically, the government agreed to move for a downward departure if defendant "made a good-faith effort prior to his sentencing to provide substantial assistance." Defendant made such an effort, and the government fully lived up to its bargain when it moved for a departure down to half of the guideline range.
inform the sentencing Judge . . . of . . . the full nature and extent of Rene Spiropoulos's cooperation and the date when such cooperation commenced; and all other information, favorable or otherwise, in the possession of this Office relevant to sentence.
Spiropoulos does not confine his argument to the language of the Act, the Guidelines, and the Plea Agreement, however. He also argues that the policy considerations which inform our interpretation of the guidelines suggest that if defendants are to be encouraged to cooperate, they must be assured that their cooperation will be rewarded, and that the benefits of their cooperation will not be denied or diminished by fortuitous events beyond their control.*fn4
We believe that this argument proves far too much. If Spiropoulos were correct, every cooperating defendant would be entitled to an identical departure, and a defendant whose good-faith efforts led to the apprehension of an international drug lord or local "kingpin" would be entitled to no greater departure than a defendant whose good-faith efforts led to the apprehension of a low-level courier -- or even to the apprehension of no one at all. That would represent unwise sentencing policy, and we reject it as an unreasonable interpretation of section 5K1.1. Additionally, Spiropoulos's argument assumes that defendants will only cooperate if they will receive the maximum departure that any cooperating witness could receive. Logic does not support that assumption. Even if a defendant knew that he or she would not receive the maximum downward departure, the defendant might still cooperate in order to receive some downward departure. We therefore do not believe that policy considerations mandate the result that Spiropoulos urges.
If the district court here, for example, had decided to confer a larger downward departure on Spiropoulos despite Boswell's untimely death, that decision would have been well within the court's discretion, regardless of the government's objection. Having set the section 5K1.1 downward departure process in motion, the government cannot dictate the extent to which the court will depart. See, for example, United States v. Paden, 908 F.2d 1229, 1234 (5th Cir 1990) (recognizing that a district court can depart more than the government recommends).*fn5 This is one area in which the Act and the Guidelines preserve district court discretion, and we see no warrant for diluting it.
We are therefore satisfied that policy considerations do not require reversal of the district court's sentence on this ground. In sum, we believe that the district court applied the proper legal standard with regard to the downward departure, hence its exercise of discretion in this instance was appropriate under the Guidelines.
Spiropoulos maintains that imposition of his sentence violated Federal Rule of Criminal Procedure 32 and his due process rights because the district court relied upon false information -- that Spiropoulos was "malicious" and "driven by avarice" -- in imposing his sentence.*fn6 We find this argument meritless.*fn7
We have held that the test to evaluate whether a sentence has been based on criteria violative of a defendant's due process right is two-fold: "(1) Has misinformation of a constitutional magnitude been given to the district court; and (2) has that misinformation been given specific consideration by the sentencing Judge?" United States v. Matthews, 773 F.2d 48, 51 (3d Cir. 1985). In order to make out a due process claim, a defendant must show that the district court relied upon some significant piece of "misinformation." Id.
Spiropoulos objects to the imposition of a fine against him under USSG § 5E1.2(i) on statutory and constitutional grounds. Section 5E1.2(i) provides:
Although the language of section 5E1.2(i) suggests otherwise, fines collected under it do not, in fact, go to pay for the costs of a defendant's incarceration. Rather, the monies from section 5E1.2(i) fines are paid into a fund called the Crime Victims Fund, as required by 42 USCA §§ 10601(a) and (b)(1) (West, 1992 Supp):
There is created in the Treasury a separate account to be known as the Crime Victims Fund . . . .
Except as limited by subsection (c) of this section, there shall be deposited in the Fund --
The Crime Victims Fund, which is separate from the General Treasury, provides grants to state programs for crime victim compensation, assistance, and restitution. See 42 USCA §§ 10602, 10603 (West, 1992 Supp).*fn8
Spiropoulos argues that the guideline and fines assessed under it are invalid because the Sentencing Reform Act, which provides the charter for the Guidelines, does not authorize assessment of a fine to recoup to the government the cost of incarcerating defendants. The government responds that the purpose of the guideline is not actually to compensate the government for the cost of incarcerating defendants, but rather is to provide restitution to crime victims, which the government claims is a valid purpose of the Act. Spiropoulos rejoins that even if the guideline is designed to provide restitution, it is invalid because the guideline's method of calculating appropriate restitution is irrational and hence inconsistent with due process.*fn9 We must first consider whether there is any authorization in the Act for the government to recoup the costs of imprisonment. Then, we must decide whether, if the guideline is purely a means of effectuating restitution, it is sufficiently rational to satisfy the requirements of the Due Process Clause of the Fifth Amendment.
Two provisions of the Sentencing Reform Act possibly provide authorization for the Commission's promulgation of section 5E1.2(i). First, 18 USCA § 3553(a) (West, 1985 and 1992 Supp) sets forth the purposes a sentencing court should consider in sentencing a defendant:
Second, 18 USCA § 3572(a) (West, 1992 Supp) details the factors that district courts must consider in determining whether to impose a fine:
In determining whether to impose a fine, and the amount, time for payment, and method of payment of a fine, the court shall consider, in addition to the factors set forth in section 3553(a) --
B. Is Payment of the Costs of Imprisonment a Valid Basis for Imposition of a Fine?
We conclude that the Act does not authorize the assessment of a fine to pay for the costs of a defendant's imprisonment. Certainly, there is no specific reference in the statute to recouping the costs of imprisonment as an appropriate goal of sentencing. Nor do we believe that assessing fines for that purpose is subsumed within the more general provisions of the Act. Recouping the costs of imprisonment has nothing to do with the nature or the seriousness of the offense, and hence is not authorized under section 3553(a)(1) or 3553(a)(2)(A). Further, there is no reason to believe that assessing the costs of imprisonment (in addition to other fines) deters criminal conduct, that it protects the public from further crimes of the particular defendant, or that it helps to rehabilitate the defendant. See 18 USCA §§ 3553(a)(2)(B),(C) and (D). At least, the government has presented no evidence suggesting that a section 5E1.2(i) fine serves any of these purposes, and we see no reason why it would.
That the current Act does not authorize a fine to be actually used for the payment of the costs of incarceration is further demonstrated by the Act's authorization of the Commission only to "study the feasibility of requiring prisoners incarcerated in Federal correctional institutions to pay some or all of the costs incident to the prisoner's confinement." Pub L No 100-690, § 7301, 100th Cong, 2d Sess, 102 Stat 4463 (November 18, 1988) (codified at 18 USCA § 4007 (West, 1992 Supp))(emphasis added). The wording of that section strongly suggests that Congress did not believe that other provisions of the Sentencing Reform Act already authorized fines to pay for the cost of imprisonment.
We have no doubt that the assessment of a fine to pay for victim compensation and victim restitution would be authorized by the Act. The language of the statute itself makes plain the congressional desire to have victim compensation be a part of sentencing. Section 3572(a)(3) provides that a Judge, in imposing a fine, may consider "any pecuniary loss inflicted upon others as a result of the offense." In authorizing district courts to consider the amount of harm a defendant inflicts on a victim in section (a)(3), the Act necessarily encompasses the ability of district courts to assess a fine in part to fund such compensation. Thus, fines for victim compensation are justified as a means of effectuating the statutory goal of restitution.*fn10
Merely finding that restitution and victim compensation are legitimate purposes of the Act does not, however, compel the Conclusion that fines assessed under section 5E1.2(i) are authorized by the Act. Spiropoulos notes that the guideline itself does not mention payment to the Crime Victims Fund and does not, on its face, appear to have anything to do with the payment of restitution to crime victims. He therefore argues that, whatever the ultimate use of the money assessed under section 5E1.2(i), the Act does not authorize the calculation of a fine on the basis of the costs of imprisonment, a factor not addressed by Congress in its definition of sentencing policy. As we read the guideline, we believe that it contemplates the payment of the fine for the purpose of compensating the government for the costs of imprisonment and not for victim restitution. The guideline states that a defendant shall pay a fine that is "at least sufficient to pay the costs to the government of any imprisonment . . ." On its very face, the guideline states that the costs will be paid to the government in an amount based on the costs of imprisonment. It stretches credulity to assume that the "purpose" of this fine is other than to compensate the government, either directly or indirectly, for the costs it incurs for incarcerating a defendant.
We recognize that the Commission itself lacks the authority to direct how fines assessed under the Guidelines be spent. That power belongs to Congress alone. See Hart v. United States, 118 U.S. 62, 6 S. Ct. 961, 963, 30 L. Ed. 96 (1886) (Congress alone controls funds in the Treasury). The resulting anomaly is that, as a result of the Victim Compensation and Assistance Act, the money actually goes to the Crime Victims Fund, although the guideline, as promulgated, plainly contemplates that the monies assessed be used for the cost of incarceration. Certainly any sentencing Judge who was not focused on the fine print in the background note of the original section (which is not in the current Guidelines), see note 8, would so believe.
The government contends, however, that because the fine monies are paid into the Crime Victims Fund, the fine is justified as a rough means of calculating an appropriate restitutionary amount and is therefore justified as consistent with the Act's restitutionary purposes. We avoid construing the guideline as the government suggests because, as Spiropoulos notes, there is serious doubt as to whether the guideline, when so construed, satisfies the requirements of due process. We agree with Spiropoulos that if the guideline is a method for assessing restitution, it runs the risk of being irrational. See United States v. Santos, 932 F.2d 244, 255 (3d Cir 1991) (standard for determining whether a law comports with the Due Process Clause is whether it has a rational basis).
We would have doubts as to whether the guideline is rational, however, because the cost of a defendant's incarceration bears no apparent relationship to the amount that a particular defendant's victim has been injured. That amount, which is calculated using a constant figure for all defendants, bears no apparent relationship to the amount of harm that a defendant has inflicted on his or her victims. Rather, it is an arbitrary constant, and one which is a major factor in calculating the resultant amount. Under the government's view of the guideline, the Commission could select any arbitrary constant and use it as a basis for calculating restitution provided the constant was multiplied by a variable factor proportional to the seriousness of the defendant's crime. Although we do not decide the issue, we have grave doubts about the rationality of such a system and because of these doubts, we avoid interpreting the guideline as a method of calculating restitution.*fn11
We recognize that our analysis in this regard is in tension with the reasoning of United States v. Hagmann, 950 F.2d 175 (5th Cir 1991). There, the court confronted a due process challenge to section 5E1.2(i) similar to the one that Spiropoulos presents here. It held that there was a sufficient relationship between the cost of imprisonment and the harm a defendant causes to society to satisfy the rationality requirement of the Due Process Clause:
Once convicted, criminals impose a dual financial cost upon society -- both the price of their imprisonment and the expense of trying to alleviate some of the personal cost inflicted upon their victims. Criminals' terms of imprisonment generally reflect, among other things, the seriousness of their crimes and the harm that they have inflicted upon their victims. We find, therefore, that the uniform practice of fining criminals on the basis of their individualistic terms of imprisonment -- an indicator of the actual harm each has inflicted upon society -- is a rational means to assist the victims of crime collectively.
With all respect, we believe that this presents too facile an analysis of the Sentencing Reform Act and the Guidelines. The Hagmann court erred primarily by failing to recognize that where the purported statutory justification for imposition of section 5E1.2(i) fines is restitution, restitution to victims must be the particular governmental purpose that the guideline serves.*fn12 We therefore conclude that to the extent that Hagmann relies on the "the price of [defendants'] imprisonment," Hagmann, 950 F.2d at 187, it is incorrect because, as the government concedes in this case, recouping "the price of imprisonment" is not a purpose of the Act. Although sparing the taxpayers the cost of imprisonment would likely be a constitutionally permissible governmental purpose, and, indeed, might be a laudable policy, it is not one expressed in 18 USCA § 3553 or 18 USCA § 3572, and we therefore find it irrelevant in evaluating the constitutionality of the guideline.
To the extent that Hagmann suggests that the guideline is a rational means of calculating restitution, we disagree for the reasons we have already stated, see pages 28-29.*fn13 The cost of imprisoning a defendant has little, if anything, to do with the amount that that defendant has harmed his or her victim(s), and is therefore questionable as an appropriate method of restitution.
It is a well-established principle that we are required to construe laws, if possible, as constitutional, see NLRB v. Catholic Bishop of Chicago, 440 U.S. 490, 99 S. Ct. 1313, 1322, 59 L. Ed. 2d 533 (1979). Recognizing that a constitutional defect might arise if we viewed the guideline as a mechanism for calculating restitution, we do not construe the guideline as imed at that end. Rather, we presume that the purpose of the guideline is the constitutionally permissible goal of allowing the government to recoup the costs of imprisonment. That goal, however, is not authorized by the Act, and we therefore hold that the fine imposed upon Spiropoulos was invalid. We thus will vacate and remand to the district court for vacatur of the fine against Spiropoulos insofar as it orders him to pay the costs of imprisonment.
We conclude by noting that, as a matter of policy, requiring defendants to pay the costs of their imprisonment seems to be a sound idea. Defendants impose high costs on society not only through the damage of their crimes but also through the financial costs of incarcerating them as a result of those crimes. Indeed, Congress may well authorize such a penalty in the near future. In addition to the current Act, which authorizes studying the question, see page 24, the executive branch has proposed requiring that prisoners be required to pay a fee to cover the costs of their imprisonment. See Budget of the United States Government, Fiscal Year 1993, Section 23, User Fees and Other Collections, at Part Two -- 16-17 and Table 23-2. Nevertheless, our review of the Sentencing Reform Act convinces us that Congress has not, as of yet, authorized such a penalty. The Commission, in promulgating a guideline designed to effectuate that end at this juncture, has therefore overstepped its bounds.