Opinion ID: 162948
Heading Depth: 2
Heading Rank: 1

Heading: Calculation of the Offense Level

Text: 15 In computing McClatchey's offense level under the version of the Sentencing Guidelines in effect at the time of his sentencing, the district court properly applied USSG § 2B4.1, entitled Bribery in Procurement of Bank Loan and Other Commercial Bribery. The base offense level under that Guideline is 8; if the bribe exceeded $2,000, the district court is instructed to increase that level by the number of levels from the table in § 2F1.1. USSG § 2B4.1(b)(1). (Amendment 617 of the Guidelines, effective November 1, 2001, deleted § 2F1.1 and moved its substance to § 2B1.1. Because McClatchey was sentenced in September 2001, that amendment does not govern this case. See United States v. Williams, 292 F.3d 681, 685 n. 2 (10th Cir.2002) (in general, we apply the Guidelines provisions in effect at the time of sentencing).) The district court found that the bribe was $50,000, and added 5 to the offense level. USSG § 2F1.1(b)(1)(F). The government challenges the $50,000 figure, contending that the bribe was $1.2 million, or at least $340,000. As a result, the offense level would need to be increased by from 8 to 11 levels, rather than only by 5. USSG § 2F1.1(b)(1)(I) and (L). 16 Both parties agree that the amount of the bribe should be calculated as the amount paid to the LaHues less the value of the lawful services they provided. They disagree on which bribes McClatchey bears responsibility for (that is, what part of the unlawful conduct is relevant to sentencing McClatchey), and the value of the LaHues' services.
17 The Sentencing Guidelines state which acts and omissions are to be considered in determining the offense level used in sentencing the defendant. The governing rules are set forth in USSG § 1B1.3, entitled Relevant Conduct (Factors that Determine the Guideline Range). For a crime such as the one here — a jointly undertaken criminal activity (a criminal plan, scheme, endeavor, or enterprise undertaken by the defendant in concert with others, whether or not charged as a conspiracy) — relevant conduct includes all reasonably foreseeable acts and omissions of others in furtherance of the jointly undertaken criminal activity. USSG 1B1.3(a)(1)(B). See United States v. Tagore, 158 F.3d 1124, 1129 (10th Cir.1998). 18 For assistance in interpreting the Guideline language, we turn to the commentary to the Guideline. Commentary that explains a guideline is authoritative unless it violates the Constitution or a federal statute, or is inconsistent with, or a plainly erroneous reading of, that guideline. Stinson v. United States, 508 U.S. 36, 38, 113 S.Ct. 1913, 123 L.Ed.2d 598 (1993). The commentary to USSG § 1B1.3 states that the focus is on the specific acts and omissions for which the defendant is to be held accountable ..., rather than on whether the defendant is criminally liable for an offense as a ... conspirator. USSG § 1B1.3, comment. (n.1). Indeed, a defendant's jointly undertaken criminal activity is not necessarily the same as the scope of the entire conspiracy, and hence relevant conduct is not necessarily the same for every participant. Id., comment. (n. 2). Thus, the court must first determine the scope of the criminal activity the particular defendant agreed to jointly undertake ( i.e., the scope of the specific conduct and objectives embraced by the defendant's agreement). Id. (emphasis added). Proper attribution at sentencing requires the district court to analyze, and make particularized findings about, the scope of the specific agreement the individual defendant joined in relation to the conspiracy as a whole. United States v. Melton, 131 F.3d 1400, 1404 (10th Cir.1997) (internal quotation marks omitted). 19 The government must prove by a preponderance of the evidence the factual basis for attributing the conduct of coconspirators to the defendant for sentencing purposes. United States v. Tran, 285 F.3d 934, 938 (10th Cir.2002). In this case the district court found that the evidence presented at trial showed, by a preponderance of the evidence, that Mr. McClatchey agreed only to jointly undertake the crime of paying bribes through the 1993 contract. Aplt.'s App. at 912. Accordingly, the court considered only the bribe paid under that contract in determining the sentence. 20 We review the sentencing court's fact findings for clear error. See Melton, 131 F.3d at 1403. To constitute clear error, we must be convinced that the sentencing court's finding is simply not plausible or permissible in light of the entire record on appeal, remembering that we are not free to substitute our judgment for that of the district judge. United States v. Torres, 53 F.3d 1129, 1144 (10th Cir.1995). 21 The government argues that the district court's finding contravenes our holding in McClatchey I. It contends that we held in McClatchey I that McClatchey joined the pay-for-patients referral conspiracy beginning in the summer of 1991, when he oversaw the negotiations for the 1993 contract. Thus, the government asserts, once it is accepted that McClatchey was a member of the conspiracy, his culpability is not measured by his `relevant conduct found by a preponderance of the evidence,' as the district court stated ..., but instead by the relevant conduct of the other conspirators that was `reasonably foreseeable to him.' Aplt.'s Opening Br. at 24. That conduct, in the government's view, encompasses not just bribes paid under the 1993 contract, but all illegal payments to the LaHues from the summer of 1991 forward, including (1) payments under the 1986 contract, (2) Eckard's salary, (3) payments under contracts with the LaHues executed after McClatchey left Baptist in October of 1993, and (4) various sweetheart deals between Baptist and the LaHues. According to the government, the combined value of these payments exceeded $1.2 million, which would result in an 11-level increase in McClatchey's offense level under former USSG § 2F1.1(b)(1)(L). 22 The government misperceives the nature of the inquiry under USSG § 1B1.3. Although we stated in McClatchey I that the evidence at trial supported McClatchey's conviction as a member of the conspiracy to violate the Antikickback Act, McClatchey I, 217 F.3d at 831, such a determination, by itself, is not sufficient to hold him responsible for all reasonably foreseeable bribes paid by his coconspirators. See Melton, 131 F.3d at 1405. Relevant conduct is limited to those reasonably foreseeable bribes that are part of the criminal activity McClatchey agreed to jointly undertake. USSG § 1B1.3, comment. (n. 2); see Tagore, 158 F.3d at 1129; Melton, 131 F.3d at 1405. The scope of McClatchey's jointly undertaken criminal activity is not necessarily the same as the scope of the entire conspiracy. USSG § 1B1.3, comment. (n. 2). In particular, [t]he fact that the defendant is aware of the scope of the overall operation is not enough to [establish the scope of the defendant's agreement] and therefore, is not enough to hold him accountable for the activities of the whole operation. United States v. Campbell, 279 F.3d 392, 400 (6th Cir.2002). 23 Our opinion in McClatchey I did not determine the precise boundaries of the criminal activity McClatchey agreed to jointly undertake. All it did was hold that the jury verdict against him had to be sustained because there was sufficient evidence that he conspired to have Baptist and the LaHues enter into the improper 1993 contract. 24 We recognize that a reasonable person could have found that McClatchey had agreed to all improper payments to the LaHues beginning as early as some time in 1991. But the evidence hardly compelled such a finding. Determining the specific conduct and objectives embraced by [McClatchey's] agreement, USSG § 1B1.3, comment. (n. 2), is not a matter of scientific precision. Different reasonable people could view the circumstantial evidence differently. We find no clear error in the district court's finding regarding the scope of McClatchey's relevant conduct. 25
26 Having determined that it was not clear error for the district court to limit McClatchey's relevant conduct under USSG § 1B1.3 to bribes paid under the 1993 contract, we turn to the government's contention that the district court clearly erred in calculating the value of the bribe paid under that contract. The payment to the LaHues under the contract was $150,000. The issue is the value of any services performed by the LaHues in return. 27 At the sentencing of McClatchey's codefendant Dan Anderson, the district court decided that the LaHues rendered $100,000 worth of services to Baptist each year between 1986 and 1994, but were paid $150,000 annually. Therefore, the court concluded, at least $50,000, though probably more, of the money paid to the LaHues each year was a bribe. Aplt.'s App. at 892. The district court adopted this finding at McClatchey's sentencing, and concluded that the value of the bribe paid under the 1993 contract was $50,000. 28 The government contends that the district court's bribe calculation was clearly erroneous. It asserts that the entire $150,000 paid under the 1993 contract was a bribe, because the LaHues performed virtually no services for Baptist. It points out that in the district court's July 21, 1999, opinion granting McClatchey's judgment of acquittal, the court stated with respect to the 1986 contract that the doctors performed only minimal services under the contract. Anderson, 85 F. Supp.2d at 1056; see id. at 1062, 1069. 29 The government does not, however, suggest any reason why the court could not reassess the evidence at the time of sentencing. We may reverse the district court's valuation of the bribe as clearly erroneous only if it is implausible in light of the entire record on appeal. Torres, 53 F.3d at 1144. That is not the case here. As the government concedes, there is evidence in the record suggesting that the LaHues performed substantial services for Baptist. Aplt.'s Reply Br. at 6. Indeed, the record contains direct support for the district court's specific finding that the value of the services the LaHues rendered was worth $100,000 per year. In determining the value of those services, the district court relied on a 1986 memorandum from Ron Keel, an operations vice president at Baptist, that recommended reducing payments to the LaHues from $150,000 to $100,000 per year. The court stated that Mr. Keel was the individual at Baptist closest to the relationship [with the LaHues] and was in the best position to put a ceiling on the value to Baptist of whatever legitimate services the LaHues were performing. Aplt.'s App. at 890-91. Other evidence in the record also supports the $100,000 figure. Dr. Nevada Lee, medical director of Baptist's clinic from 1985-1992, testified that she observed the LaHues perform a number of services for the hospital, and that she believed payments of $1 million over ten years for those services was a very fair deal. Aplee.'s Supp.App. at 404. Various doctors and nurses also testified that the LaHues performed important services for Baptist. 30 To be sure, as the district court recognized, there was also ample testimony that the LaHues performed minimal services for Baptist. Aplt.'s App. at 890. Nevertheless, as described above, there was evidence supporting the district court's conclusion that the LaHues rendered services worth $100,000. We therefore cannot say that the district court's determination of the value of the bribe paid under the 1993 contract was clearly erroneous. See Anderson v. City of Bessemer City, 470 U.S. 564, 574, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985) (Where there are two permissible views of the evidence, the factfinder's choice between them cannot be clearly erroneous.).