Court Opinion

ID: 4201413
Source: CourtListenerOpinion
Date Created: 2017-09-06 16:01:05.399959+00
Date Added: 2024-06-11T07:46:59.140256
License: Public Domain

FILED
                                                                     United States Court of Appeals
                      UNITED STATES COURT OF APPEALS                         Tenth Circuit

                             FOR THE TENTH CIRCUIT                        September 6, 2017
                         _________________________________
                                                                         Elisabeth A. Shumaker
                                                                             Clerk of Court
UNITED STATES OF AMERICA,

      Plaintiff - Appellee,
                                                           No. 16-6359
v.                                                 (D.C. No. 5:16-CR-00115-C-1)
                                                           (W.D. Okla.)
SUSIE JANE PATTON,

      Defendant - Appellant.
                      _________________________________

                             ORDER AND JUDGMENT*
                         _________________________________

Before TYMKOVICH, Chief Judge, BALDOCK, and BRISCOE, Circuit Judges.**
                 _________________________________

      The sole issue in this appeal is whether Defendant Susie Jane Patton’s above-

Guidelines sentence is substantively reasonable.

      Our story starts in July 2015 when Defendant, in a different criminal case,

pleaded guilty to wire fraud in violation of 18 U.S.C. § 1343 after she embezzled tens

of thousands of dollars from her previous employer, Silverado Reconditioning

Services, Inc. (“Silverado Reconditioning”). And at her sentencing six months later

      *
         This order and judgment is not binding precedent, except under the doctrines
of law of the case, res judicata, and collateral estoppel. It may be cited, however, for
its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
      **
        After examining the briefs and appellate record, this panel has determined
unanimously to honor the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
submitted without oral argument.
in January 2016, Defendant begged the district court for leniency. She explained that

she had embezzled the funds to fuel her gambling addiction and was now regularly

participating in Gamblers Anonymous. She further described how she had divulged

her crime to her new employer, a family-owned company named D&D Design and

Manufacturing, Inc. (“D&D Design”), and how the owners of D&D Design had still

embraced her with open arms and allowed her to continue working for them. In fact,

those same owners—at least one of whom came to support Defendant during her

sentencing—had asked her to become an authorized signer on D&D Design’s

business bank account, but Defendant told the district court she had refused because

      I knew if I ever went back to my old ways, that the accessibility was too
      much, and I knew that. And I wasn’t going to allow there to be any
      improprieties shown while I worked for these good people that worked so
      hard . . . to build a business.

She concluded by avowing that if the district court gave her “an opportunity to show

the Court and everyone around [her] how much [she had] changed,” there would

“never be a question” that she had “learned” from the error of her ways.

      After hearing a response from the government, which cautioned the district

court that Defendant was a “very accomplished con artist” who had been “engaged in

ongoing criminal conduct” since 1999, the district court informed Defendant that it

was “not going to assume” that “everything” Defendant had declared was a total

fabrication. For that reason, the district court mercifully sentenced Defendant to

21 months’ imprisonment, which was a sentence at the bottom of the applicable

Guidelines range, and ordered her to make the necessary restitution payment to

                                          2
Silverado Reconditioning.     Further, the district court generously gave Defendant

thirty days “to take care of whatever needs to be taken care of” before she was

required to voluntarily report to prison in late February. Until that time, however, the

district court stressed that “all conditions of [Defendant’s] pretrial release [would]

continue to apply.”

      Sadly, everyone involved soon came to see that the government was correct:

Defendant was merely a wolf in sheep’s clothing. In June 2016, several months after

her sentencing for wire fraud in connection with her employment at Silverado

Reconditioning and while Defendant was serving her term of imprisonment in

connection with that crime, a grand jury charged Defendant with fifteen counts of

wire fraud after it came to light that she had embezzled over a hundred thousand

dollars from D&D Design.

      Defendant’s methods were intricate.       She would first create false invoices

using the names of actual vendors of D&D Design and then input these invoices into

the company’s accounting system. The accounting system would accordingly print a

check for the payment of the invoices, and Defendant would present these checks to

the owners of D&D Design to sign. Finally, after obtaining a signature, Defendant

would deposit the checks into one of several bank accounts that she controlled.

Defendant engaged in this pattern with forty-nine different checks—yes, forty-nine—

and embezzled a combined total of $107,452.08 from D&D Design.

      But even more concerning than how Defendant defrauded D&D Design is

when she defrauded it. She initially obtained twenty-nine of the forty-nine checks

                                           3
before pleading guilty to wire fraud in the Silverado Reconditioning case. She then,

however, proceeded to obtain the remaining twenty checks after pleading guilty and

while on conditions of release in that case. And of those twenty she obtained while

on release, all but one were created before her sentencing in January 2016. In fact, a

mere two days before the sentencing, Defendant embezzled another $3,833.02 check

from D&D Design. The obvious conclusion one must necessarily draw, therefore, is

that as Defendant was begging the district court for leniency based on her purported

reformation—and, mind you, as one of the owners of D&D Design sat in the gallery

of the same courtroom as a show of his belief in and support of her—she was all the

while fully aware of nearly fifty instances where she had secretly embezzled loads of

money from D&D Design and, even more, had done so almost twenty times while on

conditions of release. And lest the reader think that the sentencing proceeding itself

was Defendant’s “Aha!” moment wherein she fully realized just how serious the

ramifications of her illegal activities were, it is worth noting that she embezzled

another $2,871.71 check after sentencing—that is, during the thirty days the district

court gave her to tidy matters up before she had to report to prison and while her

conditions of release continued to apply.

      Defendant eventually pleaded guilty to two counts of the indictment in

exchange for dismissal of the remaining thirteen counts: (1) Count 7, which regarded

a check she fraudulently obtained before her guilty plea in the Silverado

Reconditioning case, and (2) Count 14, which regarded a check she fraudulently

obtained after her guilty plea and while on conditions of pretrial release in the

                                            4
Silverado Reconditioning case.        As previously mentioned, both of these counts

constituted wire fraud in violation of 18 U.S.C. § 1343.       In addition, Count 14

implicated 18 U.S.C. § 3147, which is “strictly a sentencing enhancement provision”

for offenses committed while under conditions of release. United States v. Mowery,

No. 16-2247, 2017 WL 2297390, at *3 (10th Cir. May 25, 2017) (unpublished)

(quoting United States v. Browning, 61 F.3d 752, 756 (10th Cir. 1995)); see also id.

(“[Section] 3147 doesn’t set forth ‘a separate offense of conviction.’” (quoting

Browning, 61 F.3d at 756)). Section 3147 mandates that “[a] person convicted of an

offense committed while released . . . shall be sentenced, in addition to the sentence

prescribed for the [underlying] offense to . . . a term of imprisonment of not more

than ten years if the offense is a felony.” 18 U.S.C. § 3147 (emphasis added).1

      1
          The full text of section 3147 reads:

             A person convicted of an offense committed while released under
      this chapter shall be sentenced, in addition to the sentence prescribed for
      the offense to—
             (1) a term of imprisonment of not more than ten years if the
                 offense is a felony; or
             (2) a term of imprisonment of not more than one year if the
                 offense is a misdemeanor.
      A term of imprisonment imposed under this section shall be consecutive
      to any other sentence of imprisonment.

18 U.S.C. § 3147. Note that this section requires a conviction—not just the
commission—of an offense, alleviating the potential constitutional issues raised in
United States v. Haymond. See United States v. Haymond, __ F.3d __, 2017 WL
3752465 (10th Cir. Aug. 31, 2017) (holding that 18 U.S.C. § 3583(k), which
mandates revocation of supervised release and imprisonment of no less than five
years for the commission—not the conviction—of certain crimes by defendants
required to register under the Sex Offender Registration and Notification Act,
violates the Fifth and Sixth Amendments).
                                             5
Further, that additional term of imprisonment “shall be consecutive to any other

sentence of imprisonment.” Id.

      Section 2B1.1 of the 2015 edition of the United States Sentencing Guidelines

set the base offense level for Defendant’s sentence at 7. See U.S.S.G. § 2B1.1(a)(1).

Further, several upward adjustments served to increase her total offense level: (1) an

8-level increase because the total amount of loss exceeded $95,000, see U.S.S.G.

§ 2B1.1(b)(1)(E); (2) a 2-level increase because her embezzlement scheme involved

“sophisticated means,” see U.S.S.G. § 2B1.1(b)(10)(C); (3) a 2-level increase

because she abused the position of trust she held at D&D Design, see U.S.S.G.

§ 3B1.3; and finally (4) a 3-level increase because the sentencing enhancement under

§ 3147 for being convicted of an offense committed while under conditions of release

applied, see U.S.S.G. § 3C1.3.     Thus, after factoring in a 3-level decrease for

Defendant’s acceptance of responsibility, Defendant’s total offense level was 19.

Coupled with her rather extensive category IV criminal history, a total offense level

of 19 corresponded to a Guidelines range of 46–57 months’ imprisonment.

      Further, Application Note 1 to U.S.S.G. § 3C1.3 specified how the district

court should go about applying the mandatory sentencing enhancement under

18 U.S.C. § 3147 that must run consecutive to the underlying sentence of

imprisonment. According to Note 1,

      the court, in order to comply with the statute, should divide the sentence
      on the judgment form between the sentence attributable to the
      underlying offense and the sentence attributable to the enhancement.
      The court will have to ensure that the “total punishment” (i.e., the
      sentence for the offense committed while on release plus the statutory

                                          6
       sentencing enhancement under 18 U.S.C. § 3147) is in accord with the
       guideline range for the offense committed while on release,
       including . . . the [3-level upward] adjustment provided by the
       enhancement in this section.

U.S.S.G. § 3C1.3, comment. (n.1).     Applying that directive to Defendant’s case,

Note 1 thus instructed the district court to divvy up Defendant’s Guidelines sentence

of 46–57 months’ imprisonment to reflect that that range already accounted for the

enhanced, consecutive sentence under § 3147 via a 3-level upward adjustment. See

id.   So, for example, if the district court were to have decided that a “total

punishment” of 57 months’ imprisonment—a sentence at the high end of the

Guidelines range—was appropriate, Note 1 would have required it to attribute, say,

the first 51 months’ imprisonment to the underlying offense and the last 6 months’

imprisonment to the enhanced sentence under § 3147. See id. Such a methodology

“enables the [district] court to determine and implement a combined ‘total

punishment’ consistent with the overall structure of the [G]uidelines, while at the

same time complying with the statutory requirement [under § 3147].”          U.S.S.G.

§ 3C1.3, comment. (backg’d).

       Needless to say, when the time came for sentencing in the D&D Design case,

the district court was not pleased. Given Defendant’s despicable actions, it indicated

early on that it was considering imposing a sentence higher than the Guidelines range

of 46–57 months’ imprisonment. Initially, it felt it should do so via a departure from

the Guidelines because of its belief that Note 1 of U.S.S.G. § 3C1.3 “completely

gutted” § 3147 of its power—that is, improperly limited the amount of punishment a

                                          7
court could apply under that statute. But after granting a continuance of sentencing to

give the parties a few additional weeks to address this inclination, the district court

distanced itself from its previous, mistaken belief that Note 1 incorrectly applied § 3147

as a general matter, cf., e.g., United States v. McCary, 58 F.3d 521, 523–24 (10th Cir.

1995) (noting that the district court “correctly followed” the identically written

precursor to Note 1 of § 3C1.3); Mowery, 2017 WL 2297390, at *2–3 (noting, albeit

in an unpublished opinion, that Note 1 of § 3C1.3 generally requires the district court

to render a total punishment that falls within the Guidelines range for the offense

committed while on release), and instead indicated that the 3-level enhancement under

U.S.S.G. § 3C1.3 was simply insufficient given Defendant’s conduct in this specific

case. It also changed course and decided to grant an upward variance instead:

             I find that there are circumstances present in this case of a kind and
      to a degree not taken into account by the Sentencing Commission
      warranting a departure. Those circumstances are that this is not a case
      where one offense was undertaken while the defendant was on pretrial
      release. It was, in fact, 20 different checks, 20 different thefts, one days
      before and one days after sentencing. I don’t think this is what the
      Sentencing Commission had in mind when it provided basically a zero- to
      six-month punishment for committing an offense while on pretrial release.
      That is what the guidelines permit, a [3]-level addition [pursuant to
      U.S.S.G. § 3C1.3] to be served consecutively.
             And I find a departure is warranted in this case. However, I am
      going to, instead, vary upward, because I think it’s cleaner, simpler, and I
      do so based on the number of times that [Defendant] stole while she was on
      supervised release, the number of times she stole all together.

The district court then further discussed why it felt an upward variance was warranted

under 18 U.S.C. § 3553(a):

            The nature and circumstances of this offense are far beyond the
      normal offense in that the victims treated and responded to [Defendant] as

                                            8
      though she were their daughter. She so actively misled, misrepresented her
      own self in order to have access to this money, it takes it outside of the
      normal range of nature and circumstances of this offense.
              Even more so, however, clearly prison has not at this point been a
      deterrent for [Defendant]. She has received less than two-year sentences
      three different times in federal court, starting with probation and then two
      revocations of that probation sentence, and then the sentence that I imposed
      last January [in the Silverado Reconditioning case]. None of these terms
      have had any effect on her, apparently, as she has continued in the same
      course of conduct. So I believe a significantly longer sentence is necessary
      to afford a deterrent to her criminal conduct, and certainly to protect the
      public.

See 18 U.S.C. § 3553(a)(1), (a)(2)(B), (a)(2)(C). In its Statement of Reasons, the district

court additionally made clear that it varied upward “to reflect the seriousness of the

offense, to promote respect for the law, and to provide just punishment for the

offense.” See 18 U.S.C. § 3553(a)(2)(A).

      Ultimately, the district court felt that an above-Guidelines sentence of 82

months’ imprisonment was most appropriate:

              I have struggled with . . . how to reasonably explain the variance I’m
      going to impose. And this is what I have done: I have removed—and I
      want to make it clear, I am not changing any ruling on the guidelines. They
      have been correctly calculated in the presentence report. But in trying to
      reach a fair upward variance, I removed the three levels given for the
      commission of—well, for Count 14, commission of an offense while on
      pretrial release, from the guideline calculation, which results in a 33- to 41-
      month guideline, and I have decided to impose that twice, once for Count 7
      and once for Count 14. And the top of that range is 82 months, and that’s
      where I come out is an 82-month sentence, 25 of which is attributed to
      Count 14 and 57 of which—that is the original top of the guideline range on
      Count 7.
              For these reasons, I sentence you to the custody of the Bureau of
      Prisons for a term of 82 months, this consists of 57 months on Count 7, 25
      months on Count 14, both to be served consecutively to each other . . . .
              ….

                                            9
             I want to reiterate for clarity, if clarity can be reached based on this
      sentence I have imposed, I am not departing upward; I am varying upward.
      I am sentencing within guidelines on Count 7 and varying on Count 14.

The district also mandated, in accordance with U.S.S.G. § 5G1.3(a), that Defendant’s 82-

month sentence run consecutively to her 21-month sentence “currently being served” in

the Silverado Reconditioning case. Finally, the district court ordered Defendant to make

full restitution in the amount of $107,452.08 to the owners of D&D Design and imposed

three years’ supervised release on Defendant after her prison term ended.

      Defendant now appeals her sentence. We first note that pursuant to her plea

agreement, she has waived her right to challenge the amount of restitution the district

court required her to pay. She has also waived her right to appeal the manner in which

the district court determined her sentence. Defendant has, however, preserved her right

to appeal her above-Guidelines sentence for its substantive reasonableness—that is,

“whether the length of [her] sentence is reasonable given all the circumstances of the

case in light of the factors set forth in 18 U.S.C. § 3553(a).” United States v. Craig,

808 F.3d 1249, 1261 (10th Cir. 2015) (quoting United States v. Conlan, 500 F.3d
1167, 1169 (10th Cir. 2007)). As a result, we need not concern ourselves with the

district court’s precise methodology in attributing 57 months’ imprisonment to Count

7 and 25 months’ imprisonment to Count 14—i.e., the manner in which the district

court determined her sentence. Instead, we must answer only one simple question: Is

Defendant’s total above-Guidelines sentence of 82-months’ imprisonment too long?

      We review a sentence for substantive reasonableness using the familiar abuse-of-

discretion standard. Gall v. United States, 552 U.S. 38, 51 (2007). Under that standard,

                                            10
we will reverse “only if the sentence imposed was ‘arbitrary, capricious, whimsical, or

manifestly unreasonable.’” United States v. DeRusse, 859 F.3d 1232, 1236 (10th Cir.

2017) (quoting United States v. Gantt, 679 F.3d 1240, 1249 (10th Cir. 2012)).

Further, we may not presume that Defendant’s above-Guidelines sentence is

automatically unreasonable.     Gall, 552 U.S. at 51.      Instead, we “must give due

deference to the district court’s decision that the § 3553(a) factors, on a whole, justify

the extent of the variance,” and “[t]he fact that [we] might reasonably have concluded

that a different sentence was appropriate is insufficient to justify reversal of the

district court.” Id.

       We have little trouble concluding that the district court did not abuse its

discretion in imposing a sentence 25 months over the applicable Guidelines range.

For one thing, as the district court made abundantly clear, Defendant didn’t commit

just a single offense while on conditions of release in the Silverado Reconditioning

case. Instead, she embezzled money twenty different times after pleading guilty in

that matter (nineteen times before sentencing and one time after sentencing). The

district court was entirely justified in determining that this recurring illegal conduct

while on release, which most readily implicates the need for the sentence imposed to

reflect the seriousness of the offense, see 18 U.S.C. § 3553(a)(2)(A), was not

adequately accounted for by the 3-level upward adjustment under § 3C1.3 alone and

thus demanded an upward variance.

       Further, the district court did not abuse its discretion when it concluded that an

upward variance was needed to deter Defendant from future illegal conduct and to

                                           11
protect the public from her crimes. See 18 U.S.C. § 3553(a)(2)(B), (C). As evidenced

by Defendant’s significant criminal history and her illegal conduct while on release,

Defendant simply cannot stop defrauding others, embezzling from others, and

committing other financial crimes. As the government labeled her in the Silverado

Reconditioning case, she is a “very accomplished con artist,” and Defendant’s past

actions up to and including those in the current D&D Design matter give us no reason

to believe she will (or is even willing to) change her deceptive and harmful ways.

       But we believe the nature and circumstances of Defendant’s offense are the

most disgraceful part of this case. See 18 U.S.C. § 3553(a)(1). All the while knowing

that she had utilized complex and sophisticated methods to defraud D&D Design nearly

fifty different times by that point, Defendant stood up in front of the district court and the

owners of D&D Design and asserted that she had changed her ways for the better. These

same owners—people who came to love Defendant “as though she were their

daughter”—truly believed she had changed, and Defendant was perfectly content letting

them maintain that belief. Defendant even actively held herself out as a redeemed sinner

who “wasn’t going to allow there to be any improprieties shown while I worked for these

good people that worked so hard . . . to build a business.” And then, just several days

after that sentencing concluded, she embezzled another couple thousand dollars from the

very people who had so adamantly defended her. Such blatant deception was and still is

suffocating. We therefore believe the district court not only did not abuse its discretion in

varying upward to an 82-month sentence but also came to the correct conclusion in doing

so.

                                             12
      Defendant’s best (yet ultimately unpersuasive) counterargument is that the

district court was mistaken in its belief that U.S.S.G. § 3C1.3 did not adequately

account under 18 U.S.C. § 3147 for the number of times she embezzled money from

D&D Design while on conditions of release. To be sure, Defendant notes that her

Guidelines range of 46–57 months’ imprisonment already accounted for her conduct

while on supervised release via the 3-level upward adjustment under § 3C1.3, and

without this 3-level upward adjustment her Guidelines range would have been 33–41

months’ imprisonment.     In other words, the 3-level upward adjustment by itself

added thirteen months to the bottom of her Guidelines range and sixteen months to

the top. Contrary to the district court, Defendant claims this did adequately account

for the multiple offenses she committed while on conditions of release.

      And if any ambiguity remains, Defendant further argues that the 8-level

increase in her sentence based on the total amount of loss exceeding $95,000 also

accounted for her conduct while on release. Indeed, she notes that she incurred

$44,638.74 of the $107,452.08 she ultimately embezzled while on conditions of

release, which means that she embezzled only $62,813.34 before she was put under

those conditions. A $62,813.31 loss amount, in turn, would have resulted in only a 6-

level increase.   See U.S.S.G. § 2B1.1(b)(1)(D) (increasing by 6 levels any loss

amount over $40,000 but under $95,000).        Thus, Defendant’s conduct while on

release—embezzling an additional $44,638.74—transformed what would have been a

6-level increase into an 8-level increase. While this 2-level difference may seem

fairly inconsequential to the untrained eye, Defendant notes the rather large effect it

                                          13
had: if the 6-level increase had been used, her Guidelines range would have been 37–

46 months’ imprisonment, which was nine months lower at the bottom and eleven

months lower at the top than her eventual Guidelines range of 46–57 months’

imprisonment. Again, Defendant contends that this increase, especially when viewed

in conjunction with the 3-level increase under § 3C1.3, more-than-adequately

accounted for her conduct while under conditions of release.

      While these arguments have a certain amount of superficial appeal, they do not

establish how the district court’s decision to vary upward by 25 months was arbitrary,

capricious, whimsical, or manifestly unreasonable. All they show is that the district

court could have reasonably come to the conclusion that the Guidelines did

adequately account for Defendant’s conduct, which is insufficient to justify a

reversal. Gall, 552 U.S. at 51. After giving “due deference to the district court’s

decision that the § 3553(a) factors, on a whole, justify the extent of the variance,” id.,

we still do not believe the district court—the tribunal with expertise in the case—

abused its discretion in deciding to grant an upward variance. To be sure, we have

affirmed much larger variances from Guidelines sentences in more controversial

matters on the basis that the district court is in a “superior position to find facts and

judge their import under § 3553(a) in the individual case.” DeRusse, 859 F.3d at

1237 (quoting Gall, 552 U.S. at 51); see, e.g., id. at 1233–41 (affirming a time-served

sentence of 70 days’ imprisonment, a massive downward variance from the

Guidelines range of 108–135 months’ imprisonment, in a kidnapping case where the

                                           14
perpetrator abducted his ex-girlfriend at gunpoint and attempted to imprison her at a

bed-and-breakfast).

      Defendant proffers several other arguments based on a series of statistics and

studies suggesting that (1) her sentence should have taken into more consideration

some form of mental health treatment for her gambling addiction, (2) longer prison

sentences aren’t particularly effective in deterring future criminal conduct, and

(3) her long prison sentence would be needlessly expensive. We can easily dispose

of these arguments for the same reason we noted previously: they do not account for

the district court’s intimate familiarity with the specific details of her case. We still

see no abuse of discretion.

      As a final point, we believe it is worth mentioning that while we are

sympathetic to the fact that a severe gambling addiction may have fueled Defendant’s

crimes, any such addiction does not by itself outweigh the other sentencing

considerations that the district court took into account in this case. For her own sake,

we fervently hope that Defendant can find a way to treat any addiction she may have

so as to stem the tide of any future crimes she may be tempted to commit. That said,

her alleged overwhelming urge to gamble does not override the harm she has caused

others—particularly the owners of D&D Design—by her past actions.

                                           15
AFFIRMED.

             Entered for the Court

             Bobby R. Baldock
             Circuit Judge

            16