Opinion ID: 4315140
Heading Depth: 3
Heading Rank: 3

Heading: The Plain Error Gauntlet

Text: Mayendía argues that the district court committed plain error by not applying application note 3(E)(iii) to subtract the fair market value of the properties related to Counts One, Two, and Three from the actual loss. Mayendía's argument begins and ends with the word shall in application note 3(E)(iii). To hear Mayendía's side, application note 3(E)(iii) mandates that loss from a crime involving a mortgage loan must be reduced by the value of the undisposed collateral--no ifs, ands, or buts. Taking to heart the maxim that [t]he simplest way to decide a case is often the best, Stor/Gard, Inc. v. Strathmore Ins. Co., 717 F.3d 242, 248 (1st Cir. 2013) (quoting Chambers v. Bowersox, 157 F.3d 560, 564 n.4 (8th Cir. 1998)), we assume for the purposes of this case that, given the plain meaning of the text and the problems with a down-payment-based approach as explained above, the district court committed a clear or obvious error by failing to heed application note 3(E)(iii), especially in the absence of a persuasive reason in the record for finding that the down payments were an 20 William Shakespeare, The Merry Wives of Windsor act 2, sc. 2. - 21 - alternative reasonable estimate of the loss, and jump to the question of Mayendía's substantial rights, i.e., whether the error prejudiced him. Setting the attractions of his appeal's good parts aside, Mayendía has not carried his burden on this issue.21 As we mentioned before, the clear or obvious error must have affected the defendant's substantial rights to satisfy plain error review. An error affects the defendant's substantial rights when in the ordinary case [] he or she [can] 'show a reasonable probability that, but for the error,' the outcome of the proceeding would have been different. Molina-Martinez v. United States, 136 S. Ct. 1338, 1343 (2016) (quoting United States v. Dominguez Benitez, 542 U.S. 74, 76, 82 (2004)). In Molina-Martinez, the Supreme Court held that a defendant can satisfy this burden by pointing to the application of an incorrect, higher Guidelines range and the sentence he received thereunder. Molina-Martinez, 136 S. Ct. at 1347. Since Molina-Martinez, the Supreme Court has made clear the importance of the particularity of the showing a defendant must make under the substantial-rights prong of plain-error review. In the Court's recent decision in Rosales-Mireles v. United States, 138 S. Ct. 1897 (2018), the defendant identified for the first time on appeal that his PSR had mistakenly double- 21 See William Shakespeare, The Merry Wives of Windsor act 2, sc. 2. - 22 - counted a prior conviction, and that the mistake resulted in a change to his criminal history category that increased his guidelines range from 70-87 months to 77-96 months. Id. at 1905. The Court confirmed that showing an error resulting in a higher range than the Guidelines provide usually establishes a reasonable probability that the defendant will serve a harsher sentence, affecting his substantial rights. Id. at 1907. The Court then concluded that, in the case of a defendant who has made that showing of prejudice, [i]n the ordinary case . . . the failure to correct a plain Guidelines error that affects a defendant's substantial rights will seriously affect the fairness, integrity, and public reputation of judicial proceedings. Id. at 1911. In other words, the Supreme Court has said, and reaffirmed recently, that when appealing a guidelines calculation error under plain error review, a defendant-appellant must show that the error he has meritoriously identified, rather than some other issue in the case, satisfies the substantial rights prong. In this case, where the relevant error affecting the guideline range was the failure to subtract the fair market value of the collateral as a part of the loss calculation, Mayendía must point to facts that, had the court considered them below or were the court to consider them on remand, would allow the court to reach a specific lower (and correct) guidelines range. Mayendía has not done that. - 23 - Across all of his briefing, and reinforced at oral argument, Mayendía focuses on the fact that failure to consider the fair market value of the collateral was error, but does not advance any argument that if that error were cured, he would be entitled to a lower applicable guideline range. As application note 3(E)(iii) itself points out, this could be done with as little evidence as the most recent tax assessment value of the collateral, which creates a rebuttable presumption that the tax assessment value is a reasonable estimate of the fair market value. U.S.S.G. § 2B1.1, app. n.3(E)(iii). Though it is his burden to demonstrate plain error here, Mayendía does not proffer the tax assessments of the properties, nor does he point to any other number in the record relevant to the subtraction of the fair market value of collateral, much less an alternative proposed loss quantity, that would allow us to find that his substantial rights were affected. See Foley, 783 F.3d at 25 (rejecting defendant’s argument as no more than mere speculation because he offer[ed] no figure to show that these [loan principal] repayments . . . bring[] him into a lower Guidelines range[]). By not doing so, Mayendía has failed to articulate an argument about any applicable . . . Guidelines range much less an incorrect, higher one. Molina-Martinez, 136 S. Ct. at 1346. The only number Mayendía does identify to support his argument that his substantial rights were affected by the district - 24 - court's error is $140,000--the loan amount from Count Two. In his plea agreement, Mayendía stipulated with the government to a proposed loss of $95,000-$150,000 based on this amount. According to Mayendía, because it would have been within the district court's discretion to adopt the plea agreement's recommendation, and $140,000 is lower than the $409,129.97 loss amount the district court found, his burden is satisfied. Not so. The loss amount of $140,000 that Mayendía and the government jointly proposed in the plea agreement based only on Count Two does not mention the subtraction of collateral, the error Mayendía appeals here. Rather, the $140,000 amount would only be salient if Mayendía had persuasively argued that the district court had erred by considering Counts One and Three as related conduct when calculating the loss. As we explained above, he has waived this issue and thus did not. In other words, to endure the slings and arrows of plain error review,22 Mayendía must, and cannot, identify an applicable, correct, and lower actual loss calculation absent the clear or obvious error in his case.23 See MolinaMartinez, 136 S. Ct. at 1345-46. 22 William Shakespeare, Hamlet act 3 sc. 1. 23 To the extent Mayendía argues in the alternative that the fair market value of the collateral should have been subtracted from the down payments to satisfy application note 3(E)(iii), we take a brief detour here to explain the infirmity of that argument before the final curtain. As we explained in the primer, the district court's top-level objective when calculating loss is to - 25 - Though the better part of valor is discretion, the better part of substantial-rights analysis under plain error review is specificity.24 Falstaff would fail to satisfy plain error review, and so does Mayendía. Thus, even if the court erred, it did not do so plainly.