Opinion ID: 1027751
Heading Depth: 1
Heading Rank: 4

Heading: David’s Sentence

Text: This Court reviews sentences for reasonableness, applying an abuse of discretion standard of review. United States v. Pauley, 511 F.3d 468, 473 (4th Cir. 2007). The district court’s factual determinations as to a defendant’s role in an offense are reviewed under the clearly erroneous standard. United States v. Hyppolite, 65 F.3d 1151, 1159 (4th Cir. 1995).
David’s Presentence Investigation Report (“PSR”), as amended, calculated the base offense level for violating the money laundering statute by using the drug conspiracy as the underlying offense from which the laundered funds were derived. This produced a base offense level of 36, based on 612 grams of cocaine base. The PSR then added one level for the use of underage individuals in the commission of the crime, pursuant to 15 § 2D1.2(a)(2), and two more levels for possession of a firearm, pursuant to § 2D1.1(b)(1), resulting in a total base offense level of 39. The PSR then added two more levels because David was convicted of violating 18 U.S.C. § 1956. Lastly, the PSR added three levels for David’s aggravating role as a “manager or supervisor” in the offense pursuant to § 3B1.1, resulting in a level of 44, which exceeds the maximum offense level of 43. David’s final criminal history category was category V, which resulted in a guideline range of life imprisonment. David objected on Sixth Amendment grounds to any drug amount attribution beyond the fifty grams found by the jury as part of its verdict. He also objected to using the drug offense as the underlying offense on the money laundering charge and to the “manager or supervisor” enhancement. The district court rejected both objections and found a quantity of “more than 500 grams but less than 1.5 kilograms” of drugs was attributable to David. Further, the court found that he was a manager or supervisor of the money laundering operation within the meaning of § 3B1.1. The district court determined the PSR calculation of the life imprisonment guideline range was correct and sentenced David to life in prison. David contends that the district court’s calculation of his offense level was erroneous for two reasons. First, David argues that the court erred by using the drug conspiracy, 16 instead of the prostitution conspiracy, as the underlying offense for calculating the money laundering offense level. David next argues that the court erred by enhancing that offense level by three levels under the “manager or supervisor” provision of § 3B1.1. B. The Underlying Offense to the Money Laundering Charge To determine the base offense level for a charge of money laundering, the Guidelines direct courts to use “[t]he offense level for the underlying offense from which the laundered funds were derived . . . .” § 2S1.1. Application Note 2(A) provides “[i}n cases in which . . . there is more than one underlying offense, the offense level for the underlying offense is to be determined under the procedures set forth in Application Note 3 of the Commentary to §1B1.5.” § 2S1.1 cmt. 2(A). This commentary directs the court to use “the most serious such offense.” § 1B1.5 cmt. 3. In the case at bar, the most serious offense is the drug charge, not the prostitution charge. David argues that using the drug charge as the underlying offense was error because the Government did not prove that any laundered funds were derived from selling drugs, and that the court consistently stated that the origin of the laundered funds was prostitution. 17 Although the court did refer to the prostitution ring as the origin of the laundered funds, this does not bar the court from using the drug conspiracy as the underlying offense for the laundering charge. Courts are to consider the Guidelines’ language, and the relevant conduct provision, broadly. The relevant conduct provision, § 1B1.3, is to be construed liberally, including applicable conduct not charged in the indictment. See United States v. Asch, 207 F.3d 1238, 1244 (10th Cir. 2000); United States v. Behr, 93 F.3d 764, 765 (11th Cir. 1996); United States v. Silkowski, 32 F.3d 682, 688 (2d Cir. 1994); United States v. Davern, 970 F.2d 1490, 1494 (6th Cir. 1992). Nonetheless, the drug conspiracy charge was incorporated by reference at the first paragraph of the indictment. Thus, David was on notice that the drug conspiracy was applicable throughout to all criminal conduct charged in the indictment. Moreover, there is sufficient evidence that the receipts from the prostitution services and the sale of drugs were commingled. The record reflects that the drug and prostitution rings were inextricably linked. Testimony established that money received from the sale of drugs helped pay rent, bail, and purchases of clothes, jewelry, and condoms for the prostitutes. Moreover, the prostitutes were also directly involved in the sale of drugs. Burris testified that she and another prostitute would help bag crack for Tracy if he was “in a hurry or he 18 didn’t feel like doing it.” (JA 2823). Burris testified that she did this at least twice a week. The prostitutes also delivered the drugs to the buyers. Burris testified that she would go to Little Mexico to “drop off [crack] for D or go drop something off to David” about three times a week. (JA 2836-37). Clearly some of the money David received from selling drugs was used to purchase additional drugs or in furtherance of the expenses of the prostitution ring. Because the prostitution and drug rings were so intertwined and the laundered funds were derived from both, it was appropriate to use the drug offense as the base offense in calculating the guideline range on the money laundering charge. C. David’s Role as a Manager or Supervisor David’s offense level was increased by three levels because the district court determined that he played an aggravating role as a “manager or supervisor” of the money laundering operation. Section 3B1.1(b), the guideline provision applied to David, provides that “[i]f the defendant was a manager or supervisor (but not an organizer or leader) and the criminal activity involved five or more participants or was otherwise extensive, increase by 3 levels.” § 3B1.1(b). Chapter Three adjustments are “determined based on the offense covered by this guideline (i.e., the laundering of criminally derived funds) and not on 19 the underlying offense from which the laundered funds were derived.” § 2S1.1 cmt. 2. David argues that the district court’s finding that he was a manager or supervisor of the money laundering scheme was erroneous. We agree. David contends that he was not sufficiently involved in the scheme to be characterized as a “manager or supervisor.” While the Guidelines do not define the term “manager,” this Court has utilized the dictionary definition: “a person whose work or profession is the management of a specified thing (as a business, an institution, or a particular phase or activity within a business or institution).” United States v. Chambers, 985 F.2d 1263, 1268 (4th Cir. 1993) (quoting Webster’s Third New International Dictionary 1372 (1986)). The evidence in the record fails to support a finding that David met this description as to the money laundering scheme itself. The district court found that David “created the business,” (referring to his prostitution business), that his “[c]ell phone number was used as a number for the business,” and that “he drove [the prostitutes] to the johns that they were servicing, collected money from them, [and] split the money with his mother.” (JA 3992). However, these facts go to David’s involvement in the prostitution ring, and not to David’s involvement in the money laundering scheme. There is no evidence that David had any supervisory role in the money 20 laundering scheme, which was organized and carried out for the most part by Ila. Thus, the district court’s finding that David was a manager or supervisor of the money laundering scheme constituted procedural error rendering David’s sentence unreasonable under Gall v. United States, 128 S. Ct. 586, 597-98 (2007). See United States v. Diaz-Ibarra, 522 F.3d 343, 347 (4th Cir. 2008) (“An error in the calculation of the applicable Guidelines range . . . makes a sentence procedurally unreasonable.”). The district court’s error in the calculation of the sentencing range in determining David’s sentence requires that we vacate the district court’s judgment fixing David’s sentence, and we remand the case to the district court for resentencing without the Chapter Three adjustment.