Court Opinion

ID: 25461
Source: CourtListenerOpinion
Date Created: 2010-04-25 08:35:49+00
Date Added: 2024-06-11T09:38:01.852979
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS

                                FOR THE FIFTH CIRCUIT
                                         _______________

                                           m 01-20043
                                         _______________

                                 UNITED STATES OF AMERICA,

                                                             Plaintiff-Appellee,

                                              VERSUS

                                 RICHARD ALLISON HAMMOND,

                                                             Defendant-Appellant.

                                   _________________________

                            Appeal from the United States District Court
                                for the Southern District of Texas
                                         (H-96-CR-172-1)
                                 _________________________
                                          October 1, 2001

Before JOLLY, SMITH, and WIENER,                        Richard Hammond appeals the sentence he
  Circuit Judges.                                    received for embezzlement, contending that
                                                     the district court erred in enhancing his
JERRY E. SMITH, Circuit Judge:*                      sentence for actions committed by others.
                                                     Finding no reversible error, we affirm.

                                                                           I.
   *
     Pursuant to 5TH CIR. R. 47.5, the court has        From 1971 to 1995, Hammond was
determined that this opinion should not be           president and business manager of the
published and is not precedent except under the      International Brotherhood of Teamsters Local
limited circumstances set forth in 5TH CIR. R.       Union 988. Between 1990 and 1995, he
47.5.4.
repeatedly embezzled union funds by using his             third parties involved in jointly undertaken
union-issued American Express credit card for             criminal activity.1 Hammond again appeals his
personal expenses unrelated to legitimate                 sentence.
Local 988 business. In 1998, he was
convicted on multiple counts of embezzling                                         II.
union funds totaling $231,502.49 and also on                  The sentence must be affirmed if “the dis-
several other charges not relevant to the                 trict court . . . ha[s] made findings establishing
present appeal. Of the amount in question,                that (1) Hammond agreed to undertake
$41,712.49 was spent not by Hammond but by                criminal activities jointly with third parties, (2)
his associates, Louis Stewart and Gerald                  the losses caused by the third parties were
Doerr.                                                    within the scope of the agreement, and (3) the
                                                          third parties’ misconduct was reasonably
   Stewart was secretary-treasurer of Local               foreseeable to Hammond.” Hammond I, 201
988, and Doerr was its business agent, during             F.3d at 351. “A finding by a district court that
the period when Hammond embezzled the                     conduct is part of a common scheme is a
funds. Stewart had used his own union-issued              factual determination subject to review under
American Express card to charge $31,484.01                the clearly erroneous standard.” United States
in personal expenses, while Doerr had                     v. Vital, 68 F.3d 114, 118 (5th Cir. 1995).
embezzled $10,228.48 in the same way. The                 The district court must find that a
district court sentenced Hammond to fifty-one             preponderance of evidence indicates that the
months’ imprisonment, a five-year term of                 defendant committed the relevant conduct.
supervised release, and $369,000 in restitution.          United States v. Bryant, 991 F.2d 171, 177
                                                          (5th Cir. 1993). Thus, we reverse only if the
   We affirmed Hammond’s conviction but                   finding that a preponderance of evidence
vacated the sentence and remanded for resen-              connected Hammond to the conduct of
tencing. United States v. Hammond, 201 F.3d               Stewart and Doerr is clearly erroneous.
346 (5th Cir. 1999) (“Hammond I”). The sen-
tence was vacated because it had been                         Because the record indicates a substantial
augmented as a result of the attribution of               likelihood that Hammond, Doerr, and Stewart
Stewart and Doerr’s actions to Hammond.                   had coordinated their criminal activities, the
The panel required “a specific finding of jointly         findings are not clearly erroneous. It is
undertaken activity” if the sentence was to be            difficult to dispute the conclusion that
upheld. Id at 352.                                        Hammond was likely to have been aware of
                                                          Doerr’s and Stewart’s illegal activities but
    On remand, the district court reinstated the
fifty-one-month sentence, convinced that the
reversal of its earlier ruling had been a result of          1
                                                               As noted below, the appropriate level of proof
“deficient articulation” and that this court had          for this case was not in fact “reasonable doubt” but
been “looking for certain key words.” The                 preponderance of the evidence. Therefore, the
district court found “beyond a reasonable                 finding that, beyond a reasonable doubt, Hammond
doubt” that the funds embezzled by Doerr and              had participated in a common scheme with Stewart
Stewart could be attributed to Hammond as                 and Doerr was unnecessary; it would have been
reasonably foreseeable acts and omissions of              sufficient to show that such an inference was
                                                          supported by a preponderance of the evidence.

                                                      2
failed to report them, despite having a                        From these facts, an “explicit or implicit
fiduciary duty to do so. For several years in              agreement” can certainly be “fairly inferred
the early 1990’s, Hammond was president of                 from the conduct of the defendant and others.”
Local 988 at a time when he, Doerr, and                    U.S.S.G. § 1B1.3 (comment n.2). It is unlike-
Stewart were simultaneously embezzling union               ly that the three embezzlers would have violat-
funds. Hammond had ultimate responsibility                 ed their fiduciary duty to report each other’s
for all Local 988 spending and so had a                    activities or felt confident that their own
fiduciary duty to report and prevent any                   criminal acts would go undetected in the
embezzlement by his subordinates. Similarly,               absence of what the district court called a “re-
Stewart and Doerr had a fiduciary duty to                  ciprocal relationship” between them.
scrutinize Hammond’s expenditures and report
any potential embezzlement. As secretary-                      Thus, the judgment on remand satisfies the
treasurer of the Local and a member of its                 three criteria laid out in Hammond I, 201 F.3d
executive board, Stewart had a especially                  at 351. From the evidence, it can be fairly in-
strong responsibility in this regard.                      ferred that Hammond “agreed to undertake
                                                           criminal activities jointly with third parties.”
   Under the sentencing guidelines, “the court             Id. And a fair inference of an “explicit or im-
may consider any explicit or implicit                      plicit agreement” is all that the sentencing
agreement fairly inferred from the conduct of              guidelines require.        U.S.S.G. § 1B1.3
the defendant and others.” U.S.S.G. § 1B1.3                (comment n.2). The finding that a reciprocal
(comment n.2). District courts are also                    arrangement existed between Hammond,
allowed to take into account “all acts and                 Stewart, and Doerr satisfies Hammond I’s
omissions committed, aided, abetted,                       requirement of a “specific finding of jointly
counseled, commanded, induced, procured, or                undertaken activity.” Hammond I, 201 F.3d at
willfully caused by the defendant.” U.S.S.G.               352.
§ 1B1.3(a)(1)(A).
                                                                We do not opine that Hammond’s mere
    It is certainly possible to “infer” that an “ex-       knowledge of Stewart’ s and Doerr’s activities
plicit or implicit agreement” existed between              was sufficient proof of an agreement.2 Rather,
Hammond, Stewart, and Doerr to cover up                    it is the combination of his knowledge with the
and perhaps even facilitate each other’s em-               fact that he violated his fiduciary duty to
bezzlement. Among the items they illegally                 report their misconduct, and that they in turn
purchased with their union-issued credit cards             violated their duty to report Hammond’s own
were hunting rifles, expensive brand-name                  embezzlement, that creates a legitimate
clothing, monogrammed luggage, sporting                    inference of “explicit or implicit agreement”
goods, and home electronics equipment. As                  sufficient to satisfy the requirements of the
they reviewed the records of each other’s                  guidelines. Id.
expenditures, the three could hardly have been
in any doubt that their associates were
engaged in embezzlement and that these                        2
                                                                Cf. United States v. Evbuomwan, 992 F.2d
expenditures were not for legitimate union                 70, 74 (5th Cir. 1992) (holding that “the mere
business.                                                  knowledge that criminal activity is taking place is
                                                           not enough for sentence enhancement under
                                                           § 1B1.3").

                                                       3
   There is no doubt that the district court’s
findings on remand satisfy the second
requirement of Hammond I, that “the losses
caused by the third parties were within the
scope of the agreement.” Hammond I, 201
F.3d at 351. By definition, an agreement
reciprocally to facilitate one another’s
embezzlement contemplated the facilitation of
precisely the sort of “losses” that Doerr and
Stewart inflicted on the union. Id.

   Finally, it is also highly likely that “the third
parties’ misconduct was reasonably fore-
seeable to Hammond.” Id. Given that Ham-
mond was responsible for supervising Doerr
and Stewart and was embezzling union funds
himself, he reasonably could foresee that his
apparent reciprocal arrangement with them
would facilitate the very sort of “misconduct”
in which they actually engaged. Id.

   AFFIRMED.

                                                       4