Opinion ID: 2975692
Heading Depth: 4
Heading Rank: 1

Heading: The Abuse-of-Trust Enhancement

Text: The Guidelines provide for a two-level upward adjustment, or enhancement, of the offense level of a defendant who has abused a position of trust. U.S.S.G. § 3B1.3. Coleman claims that the district court erred in applying this enhancement to her sentence, because she was convicted only of strict-liability offenses, none of which required proof of mens rea. She argues that the erroneous offense-level enhancement, in turn, resulted in the district court’s improperly calculating the applicable Guidelines range. “Even though the Supreme Court declared the guidelines advisory in United States v. Booker, 543 U.S. 220, 125 S. Ct. 738, 160 L. Ed. 2d 621 (2005), we are still required to remand for resentencing if the district court misapplies the guidelines.” United States v. Davist, 481 F.3d 425, 427 (6th Cir. 2007). In the PSR that it submitted in advance of Coleman’s sentencing, the probation office recommended the abuse-of-trust enhancement on the ground that Coleman falsely portrayed herself as a medical doctor in order to promote the egg products as medical cures. J.A. at 1502 (Coleman PSR at 11 ¶ 54). In response, Coleman filed a sentencing memorandum in which she argued, inter alia, that the fact that she posed as a physician did not mean that she occupied a position of trust vis- a-vis the victims. J.A. at 247-49 (Coleman Sentencing Mem. II at 15-17). Her memorandum asserts that the jury, in acquitting Coleman of the fraud charge, implicitly found that she had not abused a position of trust. Id. Coleman argued that the strict-liability nature of the offense of which she was convicted precluded the application of the enhancement. Id. While Coleman’s counsel did once state, during the sentencing hearing, that Coleman did not occupy a position of trust,6 that statement was supported by no argument and was not the thrust of Coleman’s objection. The true gravamen of Coleman’s challenge to the enhancement, as set forth in her sentencing brief in the district court, was that the only issue determined at trial—that the egg powder is a drug under federal law—did not support an application of the enhancement, particularly in light of the fact that the jury acquitted Coleman of fraud. J.A. at 248 (Coleman Sentencing Mem. II at 16). In its Sentencing Memorandum, the district court rejected Coleman’s argument, ruling that Coleman had, by holding herself out as a physician, assumed a position of trust that significantly facilitated her offense. J.A. at 309-11 (Sentencing Mem. at 20-22). The district court noted specifically that Coleman made the false representations in the course of convincing the undercover agent to purchase the chlamydia and candida products. J.A. at 310 (Sentencing Mem. at 21). The district court expressly stated that Coleman’s belief in the efficacy of her product (i.e., her innocence of fraud) did not alter that finding. Id. On appeal, Coleman reiterates her contention that the abuse-of-trust enhancement is inapplicable to strict-liability crimes. She points out that, according to the Commentary to the Guidelines, “[f]or this [abuse-of-trust] enhancement to apply, the position of public or private trust must have contributed in some significant way to facilitating the commission or concealment of the offense (e.g., by making the detection of the offense 7or the defendant’s responsibility for the offense more difficult).” U.S.S.G. § 3B1.3 cmt. n.1 (2000). The note provides the following illustrations: 6 Counsel’s verbatim statement was, “To the extent that someone understood Dr. Coleman as a physician rather than a Ph.D. did not significantly facilitate the offense nor did she occupy a position of trust of physicians.” J.A. at 95859 (Sentencing Tr. at S66-S67). 7 Appellants were sentenced under the 2000 edition of the United States Sentencing Guidelines Manual. Nos. 05-3823/3826/4509 United States v. Kaminski et al. Page 11 This adjustment, for example, applies in the case of an embezzlement of a client’s funds by an attorney serving as a guardian, a bank executive’s fraudulent loan scheme, or the criminal sexual abuse of a patient by a physician under the guise of an examination. This adjustment does not apply in the case of an embezzlement or theft by an ordinary bank teller or hotel clerk because such positions are not characterized by the above-described factors. Id. Coleman relies on the fact that all of the enumerated examples are specific-intent crimes requiring proof of mens rea. Neither party has submitted, and we have been unable to find, any decision by any federal court precisely on point. Perhaps the most analogous case is the Ninth Circuit’s unpublished opinion in United States v. Merz, No. 97-30176, 1999 WL 50880 (9th Cir. 1999) (unpublished). In Merz, the defendant “did not argue at sentencing whether he occupied a position of trust. He argued instead that he lacked the mens rea to abuse the position of trust that he enjoyed.” Id. at . The Ninth Circuit affirmed the district court’s application of the enhancement, holding that “the record shows that Merz abused a position of trust. He created a business and placed himself into a position of trust that provided him the freedom to commit a difficult-to-detect wrong.” Id. (internal quotation marks omitted). Merz’s business was that of a car courier to whom clients entrusted money with which he was to procure cars for them. And while Merz, unlike Coleman, was convicted of fraud, the Ninth Circuit’s rationale for applying the enhancement was not the nature of the crime but, rather, the nature of the relationship between the defendant and his victims, which—consistent with the Guidelines language—significantly facilitated the offense. Indeed, the cases cited by Coleman herself support the application of the enhancement, as they indicate that it is appropriately imposed where the conduct on which the enhancement is based (rather than the underlying offense conduct) is of a similar character as the examples given in the Application Notes. See United States v. Peters, 394 F.3d 1103, 1106-07 (8th Cir. 2005) (“Application Note 4 to U.S.S.G. § 3C1.1 lists examples of conduct that may constitute obstruction of justice. Each example represents conduct substantially more egregious than that of Peters.”); United States v. Strachan, 5 F. App’x 169, 173 (4th Cir.) (“Although these examples are not exhaustive, they do provide insight into the nature of the activity by the defendant contemplated by [§ 3C1.1]. In reviewing them we find these illustrations to involve conduct actually much more egregious in character than [that engaged in by the defendant].”), cert. denied, 534 U.S. 931 (2001). In this case, Coleman assumed the mantle of trust accorded to a medical doctor—and there is no question that she did so deliberately—by affirmatively misrepresenting her professional credentials. Moreover, the evidence indicates that she did so in connection with her marketing and sale of the egg powders, as the misrepresentations were invariably made to consumers of the powders or during interviews about the products. This conduct is similar in nature to the examples in the Application Notes: misconduct by an attorney, a bank executive, or a physician while serving in the role of a trusted fiduciary. In short, Coleman violated the law, and she assumed a position of trust in relation to her victims while doing so. This behavior was not substantially less egregious than that contemplated by the enhancement provision. Coleman next argues that her assumption of a position of trust did not significantly facilitate her crime. In support of this contention, she asserts that her action in claiming to be a medical doctor was irrelevant to the only issue that the jury decided in convicting her—namely, whether or not the egg powders were drugs. While the proper characterization of the powders was the only Nos. 05-3823/3826/4509 United States v. Kaminski et al. Page 12 undecided issue, however, it is not the only element of the offense.8 Coleman was convicted, inter alia, of introducing unapproved new drugs and misbranded drugs into interstate commerce, and9 holding and causing to be held for sale adulterated drugs. These crimes—the marketing and selling of the egg powders—were, in turn, significantly facilitated by the consumers’ belief that Coleman was a physician. Indeed, Coleman’s desire to persuade others to consume her products was obviously the very reason that she made the misrepresentations, the efficacy of which was shown at the sentencing hearing via the testimony of Rebecca Keller (“Keller”), which demonstrated conclusively that consumers of the powder consulted Coleman for medical advice. After becoming ill upon taking the egg powder, Keller called Coleman for instructions, which Coleman gave and Keller followed. J.A. at 960 (Sentencing Tr. at S74). As we held in United States v. Gilliam, a “position of trust arises almost as if by implication when a person or organization intentionally makes himself or itself vulnerable to someone in a particular position, ceding to the other’s presumed better judgment some control over their affairs.” 315 F.3d 614, 618 (6th Cir.) (internal quotation marks omitted), cert. denied, 540 U.S. 1155 (2004). We stated, in Gilliam, that the Guidelines’ examples of situations in which the enhancement is properly applied “translate directly to the types of relationships where a ‘fiduciary duty’ exists by implication (e.g., physician-patient, lawyer-client, officer-organization, etc.).” Id. Coleman created such relationships when she held herself out to be a medical doctor in connection with her offering of the egg powders as treatments for disease, and her customers relied on those relationships in consuming the powders. Coleman’s final argument on this point is that an enhancement under these circumstances is inconsistent with the rule that a court, when imposing a sentence for a strict-liability crime, may not depart downward from the Guidelines range on the ground that the defendant lacked mens rea. The cases that she cites for this proposition, however, all involve “lesser-harm” departures, which a district court may utilize to impose a below-Guidelines sentence upon a defendant who inflicted less harm on his or her victims than that sought to be prevented by the statute. Each of these immigration cases did involve the strict-liability offense of illegal reentry after deportation, but our sister circuits held lesser-harm departures impermissible not due to the strict-liability nature of the crimes but, rather, because the defendants had not actually perpetrated less harm than that contemplated by the statute prohibiting such reentry; because the statute prohibited illegal reentry, the motives of the defendants for their illegal reentry were irrelevant. See United States v. Hernandez-Baide, 392 F.3d 1153, 1155-56 (10th Cir. 2004), vacated & remanded, 544 U.S. 1015 (2005); United States v. Saucedo-Patino, 358 F.3d 790, 794-95 (11th Cir. 2004); United States v. Dyck, 334 F.3d 736, 741-42 (8th Cir. 2003); United States v. Carrasco, 313 F.3d 750, 755-56 (2d Cir. 2002). In this case, the district court imposed the enhancement not because Coleman had committed a more egregious harm than that sought to be prevented by the statute but, instead, because the offenses that she did commit were facilitated by the trust that she enjoyed as a putative doctor. See U.S.S.G. § 3B1.3. In other words, the victims of Coleman’s crime were individuals who were rendered particularly vulnerable by the trust that they reposed in Coleman. Accordingly, we hold that the district court did not err in finding that Coleman occupied a position of trust and concluding that her abuse of that position significantly facilitated the commission of the offense. 8 Again, we refer to a single “offense” because the district court grouped Coleman’s convictions for purposes of sentencing. 9 The Supreme Court has characterized the FDCA as regulating “drug manufacturing, marketing, and distribution.” Thompson v. Western States Med. Ctr., 535 U.S. 357, 361 (2002). 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