Opinion ID: 780593
Heading Depth: 2
Heading Rank: 1

Heading: Calculation of Thorn's Offense Level

Text: 26 Facts relied on in sentencing need be established by a preponderance of the evidence and will be overturned only if they are clearly erroneous. United States v. Jacobo, 934 F.2d 411, 418 (2d Cir.1991). We apply de novo review to legal questions regarding application of the Sentencing Guidelines. United States v. Barrett, 178 F.3d 643, 645 (2d Cir.1999). 27
28 Sentencing Guideline § 2Q1.2(b)(2) directs a district court to increase the base offense level for a Clean Air Act violation by nine levels [i]f the offense resulted in a substantial likelihood of death or serious bodily injury. U.S. SENTENCING GUIDELINES MANUAL § 2Q1.2(b)(2) (2000). Application note 1(i) to § 1B1.1 (which was denominated application note 1(j) at the time of Thorn's sentencing) defines serious bodily injury as injury involving extreme physical pain or the protracted impairment of a function of a bodily member, organ, or mental faculty; or requiring medical intervention such as surgery, hospitalization, or physical rehabilitation. U.S. SENTENCING GUIDELINES MANUAL § 1B1.1, cmt. n. 1(i) (2002). Neither the Guidelines nor case law define substantial likelihood; we adopt the meaning given to this language in the preliminary injunction context, namely, that substantial likelihood means considerably more likely. See Abdul Wali v. Coughlin, 754 F.2d 1015, 1026 (2d Cir. 1985) (holding that parties seeking a preliminary injunction that would grant the movant substantially all the relief he ultimately seeks and not merely maintain the status quo must show a substantial likelihood of success on the merits, i.e., that their cause is considerably more likely to succeed than fail), overruled on other grounds, O'Lone v. Estate of Shabazz, 482 U.S. 342, 107 S.Ct. 2400, 96 L.Ed.2d 282 (1987). 6 29 Thus, the District Court should have applied the nine-level enhancement under § 2Q1.2(b)(2) if Thorn's Clean Air Act violations made it considerably more likely that a person would develop an injury involving extreme physical pain or the protracted impairment of a function of a bodily member, organ, or mental faculty, or requiring medical intervention such as surgery, hospitalization, or physical rehabilitation. To trigger the enhancement, death or serious bodily injury need not result from the offense conduct; in fact, such actual death or serious bodily injury could warrant an upward departure under the Guideline. See U.S. SENTENCING GUIDELINES MANUAL § 2Q1.2, cmt. n. 6 (2000). The District Court found 30 that there was too much uncertainty in the evidence both in terms of available medical science as well as evidence of exposure in the present case to say that with any degree of certainty any personnel suffered serious bodily injury or death. The people involved here did get involved voluntarily in the underlying criminal conduct, co-conspirators in most instances, they willfully refused to use available safety equipment which could reduce their risk of injury. There's just insufficient evidence to support the conclusion that any illness that might result from exposure to asbestos would cause serious bodily injury, so I'm not going to enhance it.... 31 We respectfully disagree and think the District Court's ruling involved two errors of law. First, that the evidence may not have established with any certainty that A+ workers actually suffered serious bodily injury or death, in the District Judge's words, is not germane to our analysis. The nine-level enhancement applies when the offense resulted in a substantial likelihood of death or serious bodily injury and not only when the offense actually caused such illness or death. 32 Second, it is not relevant under § 2Q1.2(b)(2) that some of Thorn's workers may have been co-conspirators. As the government argues, the Sentencing Commission knows how to limit an enhancement based on the creation of substantial risk of death or serious bodily injury to the victims of an offense and not to permit an enhancement when those put at risk were co-conspirators. For example, § 2K1.4(a)(1) directs district courts to apply a greater base offense level when the offense created a substantial risk of death or serious bodily injury to any person other than a participant in the offense. U.S. SENTENCING GUIDELINES MANUAL § 2K1.4(a)(1) (2000). Section 2Q1.2(b)(2) includes no similar restriction on the class of individuals put at substantial risk by the offense conduct, and we decline to read such a limitation into the Guideline. Thus, we find that § 2Q1.2(b)(2) is not limited to situations in which the offense conduct created a substantial risk of death or serious bodily injury to persons other than participants in the offense. 33 To the extent the District Court found that the evidence was too uncertain to support a finding that Thorn's conduct resulted in a substantial likelihood of death or serious bodily injury, we find that this factual finding constituted clear error. 7 The facts relevant to this enhancement are admittedly complicated because A+'s workers already were at some risk of developing these injuries as a result of their decision to work in a field that is dangerous even when all precautions are taken. Further, many of these workers were at risk of contracting some of these diseases, such as lung cancer, as a result of their decision to smoke, and some increased their exposure to asbestos by choosing not to wear respirators. The District Court seemed to take this volitional behavior into account when it noted that the people involved were involved voluntarily and willfully refused to use available safety equipment. 34 That some workers smoked 8 or failed to wear protective gear did not absolve Thorn of his duty, under the law, to comply with federal laws, including his obligation as an employer not to permit violations of safety regulations. Evidence shows that Thorn did not direct his workers to wear respirators. More importantly, in some instances, Thorn failed to provide respirators, replacement filters, sufficient quantities of protective gear, and decontamination units, despite specific requests from workers for these mandated protections. 35 We acknowledge that asbestos abatement is a dangerous profession that places workers at risk of developing asbestos-related diseases even when they and their employers comply fully with the law. But that asbestos abatement inherently imposes risks on its workers does not preclude a finding that Thorn's illegal behavior resulted in a substantial likelihood (as opposed to some undefined possibility based on the general dangers of the industry) of death or serious bodily injury to these workers. 36 We find that there is clear, undisputed testimony in the record that at least some of A+'s workers were considerably more likely, as a result of Thorn's Clean Air Act violations, to develop asbestos-related disease than if they had performed abatement under lawful conditions. Dr. Levin testified, based on the evidence in the record of many workers' sustained, routine exposure to visible emissions without respiratory protection, that among A+'s workers there will be asbestos-related disease with virtual certainty. Moreover, he offered unequivocal and unrefuted testimony concerning the Billetts brothers' exposure to asbestos as a result of Thorn's conduct. That is, as noted earlier, even assuming one-third less exposure to asbestos than Angelo had claimed in his testimony, Levin opined that there was virtually no chance that Angelo would escape developing asbestos-related scarring lung disease with impairment of lung function. 37 Thus, given the absence of an articulated reason to reject this undisputed evidence, it was clear error for the District Court to find that there was insufficient evidence that Thorn's conduct resulted in a substantial likelihood that at least one, if not several, of his former employees would develop devastating, life-threatening, asbestos-related diseases.
38 Guideline § 3B1.3 directs sentencing courts to increase the base offense level by two levels 39 [i]f the defendant abused a position of public or private trust, or used a special skill, in a manner that significantly facilitated the commission or concealment of the offense.... This adjustment may not be employed if an abuse of trust or skill is included in the base offense level or specific offense characteristic. If this adjustment is based upon an abuse of a position of trust, it may be employed in addition to an adjustment under § 3B1.1 (Aggravating Role); if this adjustment is based solely on the use of a special skill, it may not be employed in addition to an adjustment under § 3B1.1 (Aggravating Role). 40 U.S. SENTENCING GUIDELINES MANUAL § 3B1.3 (2000). Application note one explains that 41 [p]ublic or private trust refers to a position of public or private trust characterized by professional or managerial discretion ( i.e., substantial discretionary judgment that is ordinarily given considerable deference). Persons holding such positions ordinarily are subject to significantly less supervision than employees whose responsibilities are primarily non-discretionary in nature. For this adjustment 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 or the defendant's responsibility for the offense more difficult). 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. The 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. 42 Id. § 3B1.3, cmt. n. 1. Further, note three defines special skill as a skill not possessed by members of the general public and usually requiring substantial education, training or licensing. Id. § 3B1.3, cmt. n. 3. 43 We have held that [w]hether a position is one of `trust' ... is to be viewed from the perspective of the offense victims and is a question of law for the court, subject to de novo review on appeal. United States v. Wright, 160 F.3d 905, 910 (2d Cir.1998) (internal citations omitted). A court's determination that an individual abused [a] position [of trust] in a manner that significantly facilitated the commission or concealment of the offense is a question of fact reviewed for clear error. United States v. Hirsch, 239 F.3d 221, 227 (2d Cir.2001). 44 Whether someone occupies a position of trust turns on `the extent to which the position provides the freedom to commit a difficult-to-detect wrong,' United States v. Allen, 201 F.3d 163, 166 (2d Cir.2000) (per curiam) (quoting United States v. Viola, 35 F.3d 37, 45 (2d Cir. 1994), cert. denied, 513 U.S. 1198, 115 S.Ct. 1270, 131 L.Ed.2d 148 (1995)), and does not require a legally defined duty such as fiduciary duty, United States v. Barrett, 178 F.3d 643, 646 (2d Cir.1999). We recently explained that this standard requires that the defendant's position must involve discretionary authority ... [and that] this discretion must have been entrusted to the defendant by the victim. Hirsch, 239 F.3d at 227. One who merely engages in arms-length dealings in a commercial transaction does not thereby occupy a position of trust. Wright, 160 F.3d at 910; see also Hirsch, 239 F.3d at 227-28 (finding defendant held a position of trust because he was a broker and investment advisor entrusted with investment discretion by his investors and because he had a fiduciary and personal relationship (rather than an arms-length relationship) with his investors). 45 The District Court did not add two levels to Thorn's base offense level for abuse of a position of trust, reasoning that we just addressed that enhancement when we gave him an enhancement for his role as owner of the corporation, organizing the activity. The particular abuse of trust, he was given the activity because of his ability to do that type of work ... — the adjustment is based solely upon [his] use of a special skill, you can't use that to enhance him again. You made an adjustment under 3B1.1. In other words, the District Court concluded that it could not enhance Thorn's sentence under § 3B1.3 for using a special skill because it had applied an aggravating role enhancement. See U.S. SENTENCING GUIDELINES MANUAL § 3B1.3 (2000) ([I]f this adjustment is based solely on the use of a special skill, it may not be employed in addition to an adjustment under § 3B1.1 (Aggravating Role).). The question for us is whether the District Court erred in failing to impose the enhancement because Thorn abused a position of trust and did not merely use a special skill. 46 In arguing that the District Court erred in failing to enhance both the Clean Air Act and money laundering counts based on Thorn's abuse of a position of trust, the government cites to evidence in the record that Thorn enjoyed considerable discretion, due to the nature of his work, to perform illegal abatements and carry out his scheme undetected for ten years. Regulations prevented clients from being present, absent required safety gear and training, to oversee A+'s work and to confirm that A+ was complying with all state and federal laws. Clients were forced, by these circumstances, to trust that Thorn's certifications were truthful. Thorn, the government continues, then took advantage of his discretion, by, inter alia, instructing his workers to cover windows and block entryways to prevent customers from overseeing the abatements. 47 The defendant argues, in response, that Thorn's conduct was not akin to any of the examples provided in § 3B1.3's application notes. Rather, Thorn's position as a licensed abatement contractor did not aid him in avoiding the detection of his convicted offenses ... because of the substantial regulation of the asbestos industry. 48 As a contractor hired to abate his customer's asbestos, Thorn was responsible for complying with the terms of his contract, which included compliance with state and federal laws. It does not appear from the record before us that he had a close personal relationship with his clients, see Hirsch, 239 F.3d at 227-28 (distinguishing cases in which defendants had personal or fiduciary relationships with victims from those in which defendants and victims had arms-length contractual relationships), or that he was responsible for their well-being, see Wright, 160 F.3d at 910-11 (noting that a defendant who is a fiduciary or one who is responsible for the well-being of a victim of his crime, and as such is given discretion over spending and is thereby afforded an opportunity, not generally available, to embezzle moneys, does occupy ... a position [of trust]). Nor, possibly suggestive of a position of trust, did he have special access to information which he abused, such as when an employee uses a password to print airline tickets for himself, see United States v. Castagnet, 936 F.2d 57, 62 (2d Cir.1991), or an employee uses her access to company checks to write checks to her personal account, see Allen, 201 F.3d at 166-67. See also id. (summarizing Circuit cases). 49 Thorn having discretion, as the owner of A+, over how A+ would fulfill its contractual obligations to its clients (which actions the clients always could claim had insufficiently fulfilled the contract obligations), is not the same as A +'s clients giving Thorn discretion with respect to how A+ fulfilled its contract obligations. Cf. United States v. Jolly, 102 F.3d 46, 48 (2d Cir.1996) (remarking that even if a defendant has `professional or managerial discretion' in his capacity as a vice president of his company ... [,] for purposes of Section 3B1.3 the discretion must be entrusted to the defendant by the victim). Rather, his clients theoretically retained the ability to oversee Thorn's work and ensure his substantial performance of the contract, even if such oversight was more complicated due to regulations restricting access to the site or the regulatory and scientific complexity of the project. For example, they could have demanded that Thorn provide access to or at least remove the garbage bags from the windows at the work sites. Further, the government presented evidence that Thorn sent final air clearances to his clients to reassure them that he had completed the project in compliance with the law. This suggests that Thorn's clients did not blindly trust him but rather expected him to present proof that his work complied with state and federal regulations. That Thorn's illegal activities frustrated his clients' oversight by corrupting various checks on his performance does not mean that he held a position that his victims intended to be immune from oversight and control; indeed, it appears that he held a position with certain checks in place to confirm his compliance with the law and the contract, but that his illegal actions undermined these checks. Cf. Viola, 35 F.3d at 45 ([The defendant] may have abused his position as an employee by surreptitiously viewing the manifests and disclosing their contents, but his position as a forklift operator was not a repository of public or private trust within the meaning of § 3B1.3.). 50 To the extent the record includes evidence that some of Thorn's clients deferred to Thorn, such deference arguably was due to his special skill as an asbestos contractor, a skill not possessed by members of the general public and that requires substantial education, training, and licensing. See U.S. SENTENCING GUIDELINES MANUAL § 3B1.3, cmt. n. 3 (2000). It does not appear from the record before us that Thorn's clients deferred to him because of some special relationship of trust or confidence; rather, apparently they deferred to his expertise, as purportedly confirmed by independent laboratories and federal and state regulators. Although such deference could warrant a two-point enhancement under § 3B1.3 for use of a special skill, the District Court correctly held that it could not apply that enhancement in this case because it had already applied an aggravating role enhancement under § 3B1.1. See U.S. SENTENCING GUIDELINES MANUAL § 3B1.3 (2000). 51 We do not rule, however, that the position of asbestos abatement contractor as a matter of law is not a position of trust under § 3B1.3. As we concluded in United States v. Laljie, 184 F.3d 180, 195 (2d Cir.1999), Thorn's occupation may or may not be imbued with [the] characteristics of a position of trust, including professional or managerial discretion and lack of supervision. If, for example, a client entrusted Thorn with discretion to complete the abatement project with no supervision and without relying on the independent laboratory's test results or a client had a close personal or fiduciary relationship with Thorn, then conceivably a District Court could find that this particular client had put Thorn in a position with discretionary authority that then provided Thorn the freedom to commit a difficult to detect wrong. 52 The District Court did not make explicit findings, however, regarding the degree of discretion accorded Thorn by his clients. Thus, we remand this issue to the District Court for specific findings consistent with this opinion, including whether any customers entrusted Thorn with discretion to complete the asbestos projects without supervision and without relying on the independent laboratory test results to confirm compliance with state and federal regulations. 9
53 Guideline § 2S1.1(b)(2), as it existed at the time of Thorn's sentencing, instructed the sentencing court to increase the base offense level for money laundering based on the value of the funds laundered. Specifically, subsection (E) directed the sentencing judge to increase the base offense level by four points when the value of the funds exceeded $600,000 but was less than or equal to $1 million, and subsection (G) directed the judge to add six levels when the value of the funds was more than $2 million but less than or equal to $3.5 million. U.S. SENTENCING GUIDELINES MANUAL § 2S1.1(b)(2) (2000). It is appropriate to include relevant conduct, as defined in § 1B1.3, in this calculation. See generally U.S. SENTENCING GUIDELINES MANUAL § 1B1.3, cmt. background (2000) (Conduct that is not formally charged or is not an element of the offense of conviction may enter into the determination of the applicable guideline sentencing range.). The Background section of the Commentary to § 2S1.1 explained that [t]he amount of money involved is included as a factor because it is an indicator of the magnitude of the criminal enterprise, and the extent to which the defendant aided the enterprise. Id. § 2S1.1, cmt. background. 54 The government maintains that, although its trial proof focused on only twenty-two projects between 1995 and 1999, its evidence at trial and sentencing established that Thorn laundered funds in connection with at least 130 projects (and not merely the twenty-two that dominated the trial proof) during this time period and that Thorn abated at least 1,000 private residences between 1990 and 1999, for an average price of $1,100 per house, as part of the same illegal scheme. The twenty-two projects involved funds valued at just under $1 million ($939,079.98, the amount set forth in the forfeiture count of Thorn's indictment), and the residential abatements and the 108 other 1995-1999 projects, aggregated, involved funds valued at approximately $1.45 million. Thus, under § 2S1.1(b)(2)(G), the government argues that the District Court should have added six points to the money laundering base offense level of twenty-three because the value of the funds laundered was greater than $2 million. 55 The defendant raised concerns before the District Court that Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000), might require the Court to include only $939,079.98, the funds identified in the indictment as being subject to forfeiture. As the defendant contends on appeal: 56 In the context of money laundering, the sentence ultimately imposed is driven by the value of the laundered money. The amount of funds is a constitutionally significant factor which must be plead [sic] in the indictment and submitted to a jury. In the present case, the government pled and the jury found the proceeds of the money laundering conspiracy to be $939,079.98. The government is bound by its indictment and the jury finding. 57 Directly following the defendant's Apprendi argument at sentencing, the District Court stated that it had some concerns about that as well in light of the facts of this case and the evidence presented, so [it found] that a four-level adjustment is more appropriate than six. Thus, the District Court calculated the money laundering Guideline level by including only the funds involved in the twenty-two projects that were the main focus of the trial and by excluding the approximately $1.45 million for the remaining 108 projects and the 1000 or so private home abatements. As a result, because the District Court calculated the value of the laundered funds to be more than $600,000 but less than $1 million (specifically, $939,079.98), it applied § 2S1.1(b)(2)(E) rather than (G) and thus added four points to Thorn's money laundering base offense level. 58 As a matter of law, 10 we differ with the District Court to the extent that it agreed with the defendant's argument that Apprendi precluded it from including funds derived from uncharged projects. The Supreme Court held in Apprendi that [o]ther than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt. 530 U.S. at 490, 120 S.Ct. 2348. Following defendant's sentence, we concluded that Apprendi does not apply to enhancements that determine a sentence that is within the applicable statutory maximum and that would otherwise be above the applicable statutory minimum. United States v. Norris, 281 F.3d 357, 359 (2d Cir.), cert. denied, ___ U.S. ___, 122 S.Ct. 2641, 153 L.Ed.2d 820 (2002). Thorn was convicted of conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(a)(1)(A)(i), (h). The statutory maximum term of imprisonment for this offense is twenty years. 18 U.S.C. § 1956(a)(1). If the District Court had found, by a preponderance of the evidence, that the value of the laundered funds was over $2 million, as the government maintains it should have done, the bottom of Thorn's Guidelines range would have been below the twenty-year statutory maximum term of imprisonment, and Apprendi would have been implicated only if the sentencing judge had imposed a sentence within the new range but greater than the statutory maximum of 240 months. 59 The defendant acknowledges on appeal that his Apprendi argument was rejected by Norris, yet he persists in making the argument. We find that the District Court's determination that Apprendi prevented it from considering the approximately $1.45 million in calculating Thorn's money laundering offense level was legal error, in light of Norris. We remand to the District Court to make factual findings consistent with this opinion regarding whether any of the funds derived from these uncharged projects constitute relevant conduct under § 1B1.3.