Court Opinion

ID: 9488805
Source: CourtListenerOpinion
Date Created: 2023-08-05 12:55:53.940591+00
Date Added: 2024-06-11T17:53:06.469264
License: Public Domain

KENNEDY, Circuit Judge,
concurring.
I concur in the panel’s opinion except for the valuation of the fraudulently obtained goods. The District Court decided the fair market value of the stolen property based on the testimony of an employee of Columbia House Record Club (“Columbia”) that the “generic values” of a compact disc and cassette tape were' $15 and $10 respectively. However, not only did Columbia actually sell the specific products involved for less, but also there was no showing that anyone sold these products for those prices.
In this case, we are presented with the question of whether value should be determined by reference to the price for which Columbia tapes and cassettes are sold in retail stores, or whether value should be determined by the amount actually charged by Columbia for these particular labels. The latter market is easily ascertained and appropriate in this case. See United States v. Warshawsky, 20 F.3d 204 (6th Cir.1994). In Warshawsky, we rejected consideration of retail price where “the retail market has literally no connection to th[e] case.” Warshawsky, 20 F.3d at 213.
The value of the property taken is said to reflect the harm to the victim and the gain to the defendant. U.S.S.G. § 2B1.1, comment, (backg’d.). The hypothetical retail prices of compact discs and tapes assigned by Columbia to its tapes and cassettes but not charged are irrelevant to either of these considerations. Columbia does not normally receive the purported “retail prices” for these goods and the record suggests that the defendant’s gain was well under the property’s supposed retail value. Therefore, the suggested prices of the property reflect neither the gain to the defendant nor the harm to the victim. Furthermore, there was no evidence presented that any buyer or seller pays these prices.
The prices of the compact discs and cassettes actually charged by Columbia, on the other hand, are easily ascertained and are a truer reflection of market value. Essentially, a “club member” receives eight CD’s for free and then is obligated to buy six more at $15 a piece. Using these figures, the market value is $6.43/eompaet disc. This, rather than the *110assigned “generic values,” accurately reflects the market value of the stolen goods.
United States v. Colletti, 984 F.2d 1339 (3d Cir.1992), on which the panel relies, is distinguishable. In Colletti, defendant was prosecuted for the robbery of a diamond courier, who was to deliver diamonds to a discount jeweler. The retail value of the diamonds was $626,000. According to the defendant, the discount seller, to whom the diamonds were to have been delivered, would have marketed them at a 25% discount of that price. Defendant further noted that the insurer settled the jeweler’s claim for $289,000. Nevertheless, the appeals court held that there was adequate evidence in the record to support an actual market value of greater than $500,000 and therefore the district court’s decision was not clearly erroneous. Colletti may be distinguished in that the parties in that ease appear to have agreed that the $626,000 figure did represent the actual retail value of the stolen merchandise. In this case, the parties were not in agreement and the only proof offered for the fair market value of the stolen goods was the disputed testimony of an admittedly uninformed witness.
The panel rejects Warshawsky because it dealt with fraud amongst wholesalers and the victim was a player in the wholesale market. But Warshawsky similarly involved theft of a product with a hypothetical “suggested retail price” upon which the district court based its valuation. Id. at 212. As in Warshawsky, in this case the market value found by the District Court has little connection to the case. Warshawsky, 20 F.3d at 213. In both cases, there was no showing that the merchandise would ever have been sold in a retail outlet at the prices suggested by the government.
Fair market value, rather than being measured by an hypothetical market, is easily measured in this case by the amount for which Columbia sells its merchandise. Where there is such a readily available means to determine the fair market value of merchandise, I believe it is clearly erroneous not to employ it. “If some market value for the stolen property is readily-ascertainable, the sentencing court must proceed to the second part of the test by assessing the extent to which the market value adequately measures the harm to the victim or the gain to the defendant.” Warshawsky, 20 F.3d at 213.
The government argues, “[T]he ultimate purchasers of this fraudulently obtained merchandise, who bought it on the street, are the very same people who would otherwise buy the same goods at retail stores,” and thus the victim is harmed in not making those sales. Why isn’t it just as likely that the “ultimate purchasers” would otherwise have bought the same goods through Columbia? In any event, rather than positing a hypothetical foregone retail purchase at a hypothetical price, we have held that market value should be determined by the price at which the victim offered the goods for sale rather than a fictitious retail price. Warshawsky, 20 F.3d at 213 (citing United States v. Perry, 638 F.2d 862, 865 (5th Cir.1981)).
Since there exists a readily-ascertainable market value in this case, it is appropriate to VACATE the sentence and REMAND for an inquiry into the fair market prices of compact discs and cassette tapes as sold by Columbia.