Opinion ID: 219211
Heading Depth: 3
Heading Rank: 1

Heading: Offense Level and the Number of Victims

Text: To determine the guidelines-recommended sentence, the district court needed to determine both the amount of loss and the number of victims involved in Locke's crimes. See U.S.S.G. § 2B1.1(b)(1)-(2). Locke acknowledges that both factors must include conduct relevant to, but not specified within, her counts of conviction that is, acts that were part of the same course of conduct or common scheme or plan as the offense of conviction. U.S.S.G. § 1B1.3(a)(2). See also United States v. Smith, 218 F.3d 777, 783 (7th Cir.2000). She contends, however, that the district court did not make the findings necessary to support basing her offense level on relevant conduct from several counts that were dismissed at trial. We review a district court's factual findings during its determination of the offense level for clear error, reversing only when we are left with the definite and firm conviction that a mistake has been made. United States v. Cruz-Rea, 626 F.3d 929, 938 (7th Cir.2010) ( quoting United States v. Wyatt, 102 F.3d 241, 246 (7th Cir.1996)). [5] Even the deferential clear error standard cannot cure an absence of findings on key elements of the [relevant conduct] analysis. United States v. Fox, 548 F.3d 523, 532 (7th Cir.2008). During Locke's sentencing hearing, the district court calculated Locke's offense level to be 25 by including a two-level increase because her offenses involved ten or more victims. See U.S.S.G. § 2B1.1(b)(2)(A). The prosecutors had presented their view of Locke's entire fraudulent scheme during sentencing arguments, urging the district court to adopt the unconvicted counts as relevant conduct in sentencing. The government concedes that the five counts on which Locke was convicted did not involve ten or more victims, but argues that the district court correctly found that the victims involved in the dismissed counts should be included in the offense level calculation because they were directly harmed by Locke's relevant conduct. The district court noted that the issue before it in setting the offense level was whether the conduct that was charged and the other counts that weren't tried amounts to relevant conduct. (Sent. Tr. at 19.) It then stated that the law in relevant conduct is fairly clear and adequately cited by the Government. It causes the Court to find that 2 points extra is correct.... It is relevant conduct because of the case law ... cited by the Government. Id. Later, when discussing its guidelines range calculation, the district court explained that the amount of money and the number of victims involved impacted Locke's range: I've added the 2 points. I think it's appropriate to talk about ... 10 victims or more because of the relevant conduct in this case. Id. at 37. The court made no further comments regarding relevant conduct and did not explicitly adopt the PSR at the sentencing hearing. For the dismissed counts to constitute relevant conduct, the acts in those counts must have been both attributable to Locke and also part of a single scheme common to the counts of conviction. United States v. Pira, 535 F.3d 724, 728 (7th Cir.2008). Because the allegations in those counts were not proven at trial, the district court needed to determineby a preponderance of the evidencethat the events occurred and fell within § 1B1.3's purview. United States v. Ojomo, 332 F.3d 485, 489 (7th Cir.2003). That determination should be explicitly stated and supported either at the sentencing hearing or in a subsequent written statement of the district court's reasoning. Id. The statements need not be particularly robust, but they must satisfy us that the district court considered the evidence and concluded that the conduct indeed had the requisite relationship to the convictions. See id. at 490; Smith, 218 F.3d at 783. More importantly, there must be evidence before the sentencing court to support a relevant conduct finding. Each case affirming a sentence involving relevant conduct in the face of a paucity of explicit findings by the sentencing judge, Smith, 218 F.3d at 783, had one factor in common: sufficient, objective evidence in the record. E.g., United States v. Wilson, 502 F.3d 718, 721, 723 (7th Cir.2007) (defendant's confession and witnesses' statements at trial and sentencing); Smith, 218 F.3d at 784 (findings backed up by the objective evidence); United States v. Acosta, 85 F.3d 275, 279-80 (7th Cir.1996) (adopted PSR and corroborated testimony); United States v. Thomas, 969 F.2d 352, 355 (7th Cir.1992) (defendant's admission of narcotics sales). The opposite result obtains in cases where both the findings and supporting evidence are deficient. E.g., United States v. Ortiz, 431 F.3d 1035, 1042-43 (7th Cir.2005) (the district court's terse findings and the government's non-existent evidence of relevant conduct criteria required finding of clear error); United States v. Bacallao, 149 F.3d 717, 720-22 (7th Cir.1998) (lack of independent findings and reliance on PSR inadequate because nothing in the record or PSR supported relevant conduct finding); United States v. Duarte, 950 F.2d 1255, 1264-65 (7th Cir.1991) (neither evidence at trial and sentencing nor PSR supported relevant conduct conclusion). Without any evidence to serve as the denominator, a sentencing court obviously cannot find conduct to be relevant by a preponderance. Locke argues that the district court lacked evidentiary support for its relevant conduct finding. We agree. Nine of the fourteen counts against her were dismissed at trial without any evidence having been presented, and no evidence regarding her participation in the transactions underlying those counts was presented at sentencing. Although the government wished to avoid putting on several little mini-trials at sentencing, (Sent. Tr. at 7), it retained the burden of proving that any fraud in those other transactions was attributable to Locke and was part of a common plan. The government correctly asserts that the district court may rely on uncontested portions of the PSR as findings of fact. See Fed.R.Crim.P. 32(i)(3)(A); United States v. Ali, 619 F.3d 713, 719 (7th Cir. 2010). It argues that Locke's failure to object to these sections constituted an admission to the conduct necessarily involved in reaching the sums listed, enabling the court to rely on those uncontested paragraphs as findings of fact in its offense level determination. But this reasoning suffers from three infirmities. First, Locke at all times denied any knowing involvement in frauds perpetrated in the unconvicted transactions. Second, the PSR contains no discussion relating those transactions to Locke's common scheme or plan. See United States v. Sumner, 265 F.3d 532, 539-40 (7th Cir.2001). So far as we can discern, the PSR's only information regarding the victims of these transactions is a list of lenders, addresses, and dollar values in the amount of loss and restitution paragraphs. Third, the district court must actually adopt the PSR or its reasoning. The district court adopted the PSR, but only after the fact and only by checking a box without further explanation. Although the adoption of a PSR's findings in this manner may suffice under a plain error standard of review, it is inadequate when reviewed for clear error. Salem, 597 F.3d at 888. In this case, the district court simply intoned the words `relevant conduct' and pronounced sentence, Thomas, 969 F.2d at 355, without explaining what facts of the case justified such a finding. Given the lack of evidence before the district court and the lack of an explicit adoption of a PSR containing an adequate relevancy analysis, we are left with the definite and firm conviction that the district court made a mistake in considering the transactions underlying the dismissed counts as relevant conduct. Accordingly, we conclude that the district court clearly erred in determining Locke's offense level to be 25. The district court sentenced Locke to 71 months' incarceration, the top of the 57-to-71-month recommended range it had calculated. Had the additional victims not been included in the offense level calculations, Locke's offense level would have been 23 (corresponding to a guidelines range of 46 to 67 months). The district court, quite possibly, would have selected the shorter period of 67 months had the relevant conduct been excluded, so we do not find this error harmless. At the same time, we acknowledge that the district court might findbased upon sufficient evidence presented during resentencingthe conduct in the unconvicted counts relevant to Locke's sentencing. It could then state its findings with specificity and, presumably, enter the same sentence we vacate today. We express no opinion on the propriety of that outcome. Because no particular outcome is certain, we remand for resentencing. See United States v. Zahursky, 580 F.3d 515, 528 (7th Cir.2009).