Opinion ID: 2995579
Heading Depth: 1
Heading Rank: 2

Heading: Bonnie’s Appeal

Text: The probation officer computed a base offense level (tax loss) of 19. In reaching a total offense level of 27, the officer assigned 4 levels under sec. 2T1.1(b), Specific Offense Characteristics, and 4 other levels. Only the sec. 2T1.1(b) levels are challenged on appeal. Bonnie’s Criminal History Category was I, and the resulting range of imprisonment would be 70-87 months, but the statutory maximum for the conspiracy was 60 months and that was her sentence. On appeal Bonnie joins George in arguing that a claim for damages, filed by her on June 10, 1996, and closely similar to George’s, was improperly included in calculation of tax loss. What we have said with respect to this claim in George’s appeal applies to Bonnie as well. Tax loss for her was computed as $1,172,717, and reducing that by $1,000,000 would produce a base offense level of 15, a total of 23, and a range of 46-57 months imprisonment. Bonnie had not objected before the district court, but the inclusion of the $1,000,000 affected her substantial rights by causing her to be sentenced at an excessive Guideline range, see United States v. Hall, 212 F.3d 1016, 1022 (7th Cir. 2000), and in other respects satisfied our requirements for correcting plain error. Bonnie also joins George in his argument that we should remand for consideration of a downward departure. We note that in her case the jurisdictional problem does not exist. The transcript of her sentencing shows that the judge advised Bonnie that the Guidelines had taken away his discretion and that he was bound by the Guideline range. Momentarily, at least, he overlooked the portion of the presentence report which informed that the court might depart downward if it determined that the claim was sufficiently frivolous. Even if we were satisfied that the amount of the claim was properly included, we would have jurisdiction to remand for consideration of downward departure. Because, however, we decide that it was error to include the $1,000,000 claim in the tax loss, and remand for resentencing in a lower range, we need not pursue this argument. Aside from the $1,000,000 claim, the probation officer charged Bonnie with tax loss of $172,717. This was made up of George’s unpaid income and self- employment taxes for specified years-- $102,926, not at issue, and $69,791, now objected to. The latter represents refunds improperly claimed by George for 1989 and 1992. He filed the amended returns in February and September, 1993. George and Bonnie were then married, living together, and active in the tax protester organization which advocated violation of law. The filings were well within the purposes of the conspiracy which began in about August 1992. There was no evidence suggesting that Bonnie was unaware of the filings. Although George had been married to someone else in 1989 and 1990, and his then wife and he had filed joint returns, it was not clearly erroneous to find that the filings in 1993 were reasonably foreseeable to her. See U.S.S.G. sec. 1B1.3(a)(1)(B) (defendant accountable for all reasonably foreseeable acts and omissions of others in furtherance of jointly undertaken criminal activity). Bonnie objects to two levels added under sec. 2T1.1(b)(1) (If the defendant failed to report . . . income exceeding $10,000 in any year from criminal activity, increase by 2 levels.) George had failed to report $14,200 in income received in 1993 from the sale of unregistered securities in violation of Illinois law. Bonnie argues that George’s trading of unregistered securities was unforeseeable to her and outside the scope of the conspiracy. Both propositions may well be true, but the significant questions are whether George’s failure to report the income is within the scope of the conspiracy and whether the failure to report was reasonably foreseeable to her. The purposes of the conspiracy included impeding the IRS in the collection of income taxes, and George’s failure to report income was well within that purpose. His duty to report existed until tax time in 1994, while the two were married, living together, active in the tax protester organization referred to, and the conspiracy continued. The record shows that the Illinois Securities Department started a proceeding against George to stop the sales and on December 20, 1993 Bonnie delivered papers to the Department explaining why subpoenas would not be honored. A finding that George’s failure to report this income furthered the conspiracy and was reasonably foreseeable to her was not clearly erroneous. We note that one case has drawn a distinction between the use of the defendant in U.S.S.G. sec. 2T1.1(b)(1) and the use of the passive voice in sec. 2T1.1(b)(2), possibly suggesting an argument that (1) is applicable only to the defendant who failed to report and not to a co-conspirator who had no duty to report. United States v. Lewis, 93 F.3d 1075, 1084 (2d Cir. 1996). Cf. United States v. Harris, 230 F.3d 1054, 1061-62 (7th Cir. 2000) (Ripple, J., dissenting); United States v. Sullivan, 75 F.3d 297, 303 (7th Cir. 1996); United States v. Tagore, 158 F.3d 1124, 1129 (10th Cir. 1998). Bonnie has not made this argument and we do not consider it. Bonnie further contends that it was plain error not to decrease her offense level as a minimal or minor participant in the conspiracy. U.S.S.G. sec. 3B1.2. Such a reduction was warranted only if she was substantially less culpable than George. See United States v. Montenegro, 231 F.3d 389, 395 (7th Cir. 2000) (reductions granted in conspiracy only if defendant is substantially less culpable than conspiracy’s other participants). Bonnie’s extensive involvement in We the People included taking attendance and collecting money at meetings, and she also filed false documents with banks and the IRS, made obstructionist responses to IRS inquiries, and attempted to hide assets by paying for them with cash or third- party checks and titling them under her maiden name. We find no error in the district court’s determination that she was neither a minor nor a minimal participant. We vacate both sentences and remand for resentencing consistent with this opinion. George’s sentence of imprisonment is to be within the range of 51-63 months and Bonnie’s within the range of 46-57 months unless the court finds some proper basis for downward departure pursuant to U.S.S.G. sec. 5K2.0.