Court Opinion

ID: 4269511
Source: CourtListenerOpinion
Date Created: 2018-04-24 16:00:34.071849+00
Date Added: 2024-06-11T09:14:12.428582
License: Public Domain

Case: 15-14846       Date Filed: 04/24/2018       Page: 1 of 18

                                                                                   [PUBLISH]

                  IN THE UNITED STATES COURT OF APPEALS

                            FOR THE ELEVENTH CIRCUIT
                              ________________________

                                     No. 15-14846
                               ________________________

                      D.C. Docket No. 1:14-cr-00001-WLS-TQL-1

UNITED STATES OF AMERICA,

                                                                           Plaintiff-Appellee,
                                             versus

CHRISTOPHER WHITMAN,
SHAWN MCCARTY,

                                                                      Defendants-Appellants.

                               ________________________

                      Appeals from the United States District Court
                          for the Middle District of Georgia
                              _______________________

                                       (April 24, 2018)

Before WILLIAM PRYOR and JULIE CARNES, Circuit Judges, and ANTOON, *
District Judge.

WILLIAM PRYOR, Circuit Judge:

*
  Honorable John Antoon II, United States District Judge for the Middle District of Florida,
sitting by designation.
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      This appeal from convictions of bribery, wire fraud, theft, and obstruction

involving government contracts presents two questions: (1) whether the district

court abused its discretion when it declined to instruct the jury about the offense of

giving illegal gratuities as a lesser-included offense of bribery; and (2) whether the

district court clearly erred when it determined that one of the defendants was

responsible for the entire loss amount attributable to the criminal scheme.

Christopher Whitman, the owner of a trucking company, United Logistics, bribed

Shawn McCarty and two other employees of the federal Defense Logistics Agency

to steer transportation contracts to and increase the profits of United Logistics.

Whitman and McCarty were convicted and sentenced for their roles in committing

multiple crimes, including wire fraud and bribery. Whitman argues that the district

court abused its discretion when it refused to instruct the jury about giving illegal

gratuities as a lesser-included offense of bribery. But the district court did not

abuse its discretion because the trial involved no dispute that would have allowed

the jury to convict Whitman of the lesser charge while acquitting him of bribery.

Whitman argued at trial an exculpatory defense that, if believed, would have

required the jury to acquit him of both charges. McCarty argues that the district

court erred when it calculated his Sentencing Guidelines range using the total loss

amount caused by all four schemers. But a defendant may be held responsible for

all losses caused by a jointly undertaken criminal activity, and the district court did

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not clearly err when it inferred that McCarty agreed to join a scheme involving

Whitman and the other two government employees. We affirm Whitman’s

conviction and McCarty’s sentence.

                                I. BACKGROUND

      For about four years, Christopher Whitman orchestrated a scheme that

defrauded the United States of more than $15 million. In 2008, Whitman founded a

trucking company called United Logistics, and he later bribed three employees of

the Defense Logistics Agency on a Marine Corps base to use his trucking company

to ship military equipment around the country. Whitman bribed Mitch Potts, the

office supervisor, Jeffrey Philpot, a transportation assistant, and Shawn McCarty,

another transportation assistant.

      Because the Department of Defense hired an outside company, Menlo, to

book shipment carriers, the four schemers devised shipment requirements that all

but guaranteed that United Logistics would receive assignments. For example,

Philpot delayed making requests and required same-day pickups to force Menlo

representatives to assign the shipments to a local carrier. A Menlo representative

testified that one request gave the company a lead time of ten minutes, “which is

virtually impossible” to honor. Philpot also required the use of certain trailers

because United Logistics had more of those trailers than any other carrier. He

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testified that he “couldn’t guarantee the business would go [to United Logistics],

but it was, you know, most likely.”

      Yet Whitman rarely, if ever, satisfied the special requirements the

employees imposed. Although Whitman instructed his assistant to accept every

request from Menlo, United Logistics owned only two trucks. Whitman would

regularly send one of the two trucks to pick up the shipments and transport them

back to his yard. His assistant would then hire other trucking companies to handle

the shipments without complying with any expedite, special-equipment, or other

restrictive requests.

      The four schemers also used tactics to boost the profits of United Logistics.

Philpot explained that he “short load[ed]” trucks by “[b]reaking . . . shipment[s]

down into . . . smaller shipment[s]” so that the government was forced to “order

more trucks than w[ere] actually required.” Whitman then reloaded the shipments

into fewer trucks once he got them back to his yard and billed the government for

more trucks than he actually used. The evidence also established that McCarty

once contracted with United Logistics to ship a single pallet of elastic cord from

Albany, New York, to Canada for a total cost of more than $12,000. Because the

shipment was designated “exclusive use,” no other cargo could accompany the

pallet even though it filled only about one-fiftieth of the space in a single trailer.

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      In exchange for steering profitable contracts to United Logistics, Whitman

paid the government employees in cash and goods. For example, Whitman paid

Potts $5,000 to $6,000 in cash-filled envelopes “monthly as long as [they] were

doing good work,” gave him gift cards to restaurants, and bought a house from

him. Whitman initially paid Philpot “[a]nywhere from $1,000 up to $5,000” in

cash “[a]t least two or three times a week,” and later wrote checks for “items

[Philpot] wanted” because that was “more convenient for him.” He also paid a

construction company owned by McCarty to make improvements to Philpot’s

home. And Whitman bought McCarty multiple cars, let McCarty live in one of his

houses rent-free for a year and a half, and treated McCarty and Philpot to a

bachelor party where he gave each of them money to gamble.

      Although the employees never discussed with each other the specifics of

their individual arrangements with Whitman, they knew about the criminal conduct

of their colleagues. Whitman told Potts that he “had [McCarty] working for him”

and that he was “paying him to get [him] as many loads as possible.” Because

Philpot was McCarty’s supervisor, he frequently reviewed McCarty’s work and

identified fraudulent activity, like short loading, but failed to take any corrective

action. Philpot testified that he “figured [McCarty] was doing pretty much the

same thing [he] was doing” and that “[he] did not want to get him in trouble, and

[he] didn’t want [him]self to get in trouble either.”

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      In 2012, agents from the Naval Criminal Investigative Service informed

Potts and Philpot that they were under criminal investigation because of their

relationship with Whitman. The two employees left the military base to meet with

each other, and Philpot called McCarty “to give him a heads up.” Whitman later

joined the meeting and told Philpot and Potts to “make sure [their] phones [we]re

clear.”

      McCarty, Potts, and Philpot met with each other several times as the

investigation progressed to “touch base, [to] see if anybody had heard anything,

[and to] try to find out what was going on.” At one meeting, Philpot told McCarty

that he was planning to meet with investigators to discuss his role in the scheme.

McCarty responded that “all they had on him was a four-wheeler and a Mustang,

and he wasn’t going to prison for that.” At another meeting, Whitman advised

Potts and Philpot, “[T]he fish that don’t open his mouth don’t get hooked.”

Unpersuaded, Potts and Philpot agreed to cooperate with the government.

      At trial, Whitman defended himself by arguing that he was extorted. He

contended that “[t]he money he paid was paid because [Potts and Philpot]

threatened to blackball him and to eliminate him as a carrier.” In his opening

statement, Whitman’s counsel stated, “[Whitman] didn’t have a corrupt intent to

bribe. And that is [his] defense.” When he cross-examined Philpot, counsel asked

if he told investigators that he “threatened Whitman that [he] would turn him off.”

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During his examination of an agent who interviewed Philpot, he asked whether

Philpot “disclose[d] that there were instances when Whitman was a little slow in

compensating him,” that Philpot “would need to remind Whitman to pay him,” and

that he “threatened Whitman that he would, quote, turn him off if Whitman did not

continue paying him.” And in his closing argument, counsel reiterated that it was

his “position” that “Whitman [wa]s the victim of extortion by two clearly corrupt

government officials.” He stated that “Whitman had to pay to keep doing business”

and that “the government ha[d] not carried its burden of showing beyond a

reasonable doubt by trustworthy evidence that the[] payments were not the result

of extortion.”

      Whitman’s proposed jury instructions also reflected his defense of extortion.

Whitman’s counsel requested that the district court instruct the jury about the

definition of “corruptly” and the defense of economic coercion. For example, he

asked that the district court stress that “the defendant would not be guilty of the

offense of bribery if he paid money to the federal official, but did so as a result of

coercion, and not with a corrupt motive.”

      At the charge conference, Whitman’s counsel raised—for the first time—the

possibility of a new theory of defense: that he gave illegal gratuities, not bribes, to

the government employees. Whitman’s counsel stated, “Your Honor, I have

another matter that I just didn’t snap to. The Defendant Whitman would request the

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lesser-included offense charge of gratuity.” Counsel argued that instead of

convicting Whitman of bribery, the jury “could find that there was not a specific

purpose or—we just talked about specific purpose ‘for this, for those,’ and all of

that. They could find it wasn’t for that. It was just a payment.” The government

and two of Whitman’s co-defendants, including McCarty, opposed the request, and

after a short recess to consider the argument, the district court decided not to give

the instruction. It stated that “there is little, if any evidence in the record of

payments being made as gratuit[ies].” And because the jury would be asked “to

deliberate on a matter that[] [is] not really clearly in the case,” the instruction

“would be more confusing than it would be of aid[] [to] the jury in its

deliberation.”

       The jury convicted Whitman of 43 counts of wire fraud, five counts of

bribery, one count of theft of government property, four counts of obstruction of

justice, and one count of obstructive destruction of records. And the district court

sentenced him to 264 months of imprisonment, restitution totaling $18,860,313.75,

a $5,400 assessment, and three years of supervised release.

       The jury convicted McCarty of 15 counts of wire fraud, one count of

bribery, and one count of obstruction of justice. At his sentencing, the district court

calculated his Sentencing Guidelines range using the loss amount caused by all

four schemers. It stated that “[a] loss amount as to Defendant McCarty of

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$17,543,430.45 in the [district] [c]ourt’s opinion [wa]s supported by a

preponderance of the evidence.” It acknowledged McCarty’s argument that he was

personally responsible for a far smaller loss amount, but it explained that “under a

reasonable interpretation of the charges as . . . argued by the government and as the

jury considered,” he was “involve[d] in a scheme, and th[e] scheme center[ed]

around the Defendant Whitman.” It ruled that McCarty was “accountable” for the

conduct of other participants in the scheme, even though the government did not

charge a conspiracy and he was “not specifically and discretely found guilty . . . by

the jury” of the other schemers’ conduct. The district court sentenced him to 120

months of imprisonment, restitution totaling $15,410,151.55, a $1,700 assessment,

and three years of supervised release.

                          II. STANDARD OF REVIEW

      Two standards govern our review of this appeal. We review a decision not to

give a requested instruction for abuse of discretion. United States v. Gutierrez, 745

F.3d 463, 470 (11th Cir. 2014). “[W]e will leave undisturbed a district court’s

ruling unless we find that the district court has made a clear error of judgment, or

has applied the wrong legal standard.” Arthur v. Thomas, 739 F.3d 611, 628 (11th

Cir. 2014) (quoting Ameritas Variable Life Ins. v. Roach, 411 F.3d 1328, 1330

(11th Cir. 2005)). And we review a finding of amount of loss for clear error. See

United States v. Siegelman, 786 F.3d 1322, 1333 (11th Cir. 2015). We must affirm

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the finding if it is “plausible in light of the record viewed in its entirety.” Id.

(quoting Anderson v. City of Bessemer City, 470 U.S. 564, 574 (1985)).

                                  III. DISCUSSION

       We divide our discussion in two parts. First, we explain that the district court

did not abuse its discretion when it refused Whitman’s last-minute request to

instruct the jury about paying illegal gratuities because Whitman argued an

exculpatory defense that, if believed, would have required the jury to acquit him of

both bribery and giving illegal gratuities. Second, we explain that the district court

did not clearly err when it calculated McCarty’s loss amount.

   A. The District Court Did Not Abuse Its Discretion when It Refused To Give
        a Lesser-Included-Offense Instruction on Giving Illegal Gratuities.
       Whitman argues that the district court erred when it refused to instruct the

jury about giving illegal gratuities as a lesser-included offense of bribery. Federal

Rule of Criminal Procedure 31(c) provides that “[a] defendant may be found guilty

of . . . an offense necessarily included in the offense charged.” Although providing

an instruction on a lesser-included offense often aids the prosecution in obtaining a

conviction on, at least, one charge, “it is now firmly established that Rule 31(c)’s

provision for lesser offense instructions benefits the defendant as well.” Schmuck v.

United States, 489 U.S. 705, 717 n.9 (1989). It “protects the defendant” because

“where the jury suspects that the defendant is plainly guilty of some offense, but

one of the elements of the charged offense remains in doubt, . . . the jury will likely

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fail to give full effect to the reasonable-doubt standard” and “resolv[e] its doubts in

favor of conviction” if the district court does not give the instruction. Id.

      To establish that the district court abused its discretion, Whitman must

satisfy a two-part test. United States v. Williams, 197 F.3d 1091, 1095 (11th Cir.

1999). “First, he must show that the charged offense encompasses all of the

elements of the lesser offense (the ‘elements’ test).” Id. “Second, he must establish

that the district court abused its discretion in failing to give the instruction”

because “the evidence would permit the jury rationally to acquit the defendant of

the greater, charged offense and convict him of the lesser.” Id.; see also Carter v.

United States, 530 U.S. 255, 261 n.3 (2000). We have explained that “[a]bsent any

evidence to support the bare assertion of [a defendant’s] lawyer” that the

government failed to prove an element of the greater offense, “the trial court [i]s

not required to instruct the jury about lesser included offenses.” United States v.

Tisdale, 817 F.2d 1552, 1554 (11th Cir. 1987); see also Gutierrez, 745 F.3d at 470.

      The only element necessary to prove the greater offense of official-act

bribery but not necessary to prove the lesser-included offense of giving illegal

gratuities is the existence of a “quid pro quo—a specific intent to give or receive

something of value in exchange for an official act.” United States v. Sun-Diamond

Growers of Cal., 526 U.S. 398, 404–05 (1999). Official-act bribery prohibits

“directly or indirectly, corruptly giv[ing], offer[ing] or promis[ing] anything of

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value to any public official or person who has been selected to be a public

official . . . with intent . . . to influence any official act.” 18 U.S.C. § 201(b)

(emphasis added). In contrast, the gratuities provision prohibits “directly or

indirectly giv[ing], offer[ing], or promis[ing] anything of value to any [past,

present, or future] public official, for or because of any official act performed or to

be performed by such [official].” 18 U.S.C. § 201(c) (emphasis added).

       The two statutory provisions contain distinct intent elements. See Sun-

Diamond, 526 U.S. at 404–05. Official-act bribery requires the “intent ‘to

influence’ an official act,” which means that there must be a “quid pro quo,” or “a

specific intent to give or receive something of value in exchange for an official

act.” Id. at 404–05. But giving illegal gratuities “requires only that the gratuity be

given or accepted ‘for or because of’ an official act.” Id. at 404. So “[a]n illegal

gratuity . . . may constitute merely a reward” for some future or past act by the

official. Id. at 405.

       We need not decide whether giving illegal gratuities is a lesser-included

offense of bribery. At least one circuit has held, over dissent, that it is. United

States v. Alfisi, 308 F.3d 144, 152 & n.6 (2d Cir. 2002); see also id. at 158–61

(Sack, J., dissenting). The government argues that we should adopt the reasoning

of the dissent in that decision and hold that, although giving illegal gratuities is a

subset of official-act bribery, it is not a lesser-included offense of all three of the

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alternative forms of bribery, 18 U.S.C. § 201(b). We need not resolve that issue of

first impression in this Circuit because Whitman has not established that the

evidence at trial would have permitted the jury to acquit him of bribery and convict

him of giving illegal gratuities.

      Whitman argued at trial that he was the victim of extortion and, as a result,

lacked the intent necessary to support a bribery conviction, but “[w]hen a

defendant relies on an exculpatory defense that, if believed, would lead to

acquittals on both the greater and lesser charges, it is no abuse of discretion to

refuse to instruct the jury on a lesser included offense.” United States v. Brown, 26

F.3d 119, 120 (11th Cir. 1994). The parties do not dispute for the purpose of this

appeal that economic coercion is a complete defense both to bribery and to giving

illegal gratuities, and the district court instructed the jury that economic coercion

was a complete defense to the charge of bribery. But see United States v.

Colacurcio, 659 F.2d 684, 690 (5th Cir. Unit A Oct. 1981) (“[A]ppellants’

insistence that extortion can be a defense to bribery is incorrect. . . . [E]ven if the

appellants were subjected to extortion, they c[ould] still be convicted on the

bribery charge[s].” (internal citation omitted)). In this posture, we will assume

without deciding that the parties’ assumptions are correct. So the dispute about

whether Whitman was extorted would not have “permit[ted] the jury rationally to

acquit [him] of [bribery] and convict him of [giving illegal gratuities].” Williams,

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197 F.3d at 1095. If the jury had believed that he was extorted, it would have

acquitted him of both offenses.

     B. The District Court Did Not Clearly Err when It Calculated McCarty’s
         Sentencing Guidelines Range Using the Loss Amount Caused by All
              Participants in the Jointly Undertaken Criminal Scheme.

      Because the district court ruled that McCarty joined a criminal scheme, it

calculated his Sentencing Guidelines range using the approximately $17.5 million

loss caused by all participants in the jointly undertaken scheme. McCarty

maintains that this ruling was clearly erroneous because the actions of the other

government employees were taken independently and were not the product of any

criminal agreement under the Sentencing Guidelines. See United States Sentencing

Guidelines Manual § 1B1.3(a)(1)(B) (Nov. 2015). He asserts that the government

employees acted “independently and secretly even between each other[,] behind

closed doors even in the same office.” We disagree.

      We review a loss-amount determination for clear error and must affirm the

finding by the district court if it is “plausible in light of the record viewed in its

entirety.” Siegelman, 786 F.3d at 1333 (quoting Anderson, 470 U.S. at 574). The

government bears the burden of establishing “the pertinent facts by a

preponderance of the evidence.” United States v. Moran, 778 F.3d 942, 973 (11th

Cir. 2015). But a district court “need only make a reasonable estimate of the loss,

given the available information.” Id. (quoting United States v. Barrington, 648

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F.3d 1178, 1197 (11th Cir. 2011)). And because “[d]istrict courts are in a unique

position to evaluate the evidence relevant to a loss determination,” we must give

their determinations “appropriate deference.” Id.

      The Guidelines permit a district court to hold participants in a “jointly

undertaken criminal activity” responsible for the “acts and omissions of others”—

even if the government did not charge a conspiracy. U.S.S.G. § 1B1.3(a)(1)(B); see

also United States v. Sammour, 816 F.3d 1328, 1340 (11th Cir. 2016). The “acts

and omissions” must be “within the scope of the jointly undertaken criminal

activity,” “in furtherance of” the activity, and “reasonably foreseeable in

connection with” the activity. U.S.S.G. § 1B1.3(a)(1)(B). To determine the “scope

of the defendant’s agreement” to participate in a jointly undertaken criminal

scheme, the district court may consider “any explicit agreement or implicit

agreement fairly inferred from the conduct of the defendant and others.” Id.

§ 1B1.3, cmt. n.3(B). A defendant’s “[m]ere awareness” that he was part of a

larger scheme “is alone insufficient” to show that another individual’s criminal

activity was “within the scope of [the defendant’s] jointly undertaken criminal

activity.” United States v. Presendieu, 880 F.3d 1228, 1246 (11th Cir. 2018). But

actions that suggest that the defendant was actively involved in a criminal scheme

permit the inference that the defendant agreed “to jointly undertake” that scheme.

U.S.S.G. § 1B1.3, cmt. n.3(B); see, e.g., United States v. Nerey, 877 F.3d 956, 978

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(11th Cir. 2017). For example, an implicit agreement may be inferred if, even

though “the various participants in the scheme acted on their own behalf, each of

the participants knew each other and was aware of the other’s activities, and they

aided and abetted one another by sharing” information necessary for the operation

of the scheme. United States v. Hunter, 323 F.3d 1314, 1322 (11th Cir. 2003)

(discussing United States v. Hall, 996 F.2d 284 (11th Cir. 1993)).

      The record permitted the district court to infer that McCarty agreed to

participate in a jointly undertaken criminal scheme. For example, McCarty

participated in the bribery of Philpot. The evidence established that Whitman paid

a construction company owned by McCarty to make improvements to Philpot’s

home. And that bribe was similar to the bribes McCarty received from Whitman,

which suggests that McCarty was aware that he was facilitating a bribe.

      Throughout the operation of the scheme, Whitman, Philpot, and Potts spoke

to each other about the involvement of the other participants, including McCarty.

Whitman told Potts that he “had [McCarty] working for him” and that he was

“paying him to get [him] as many loads as possible.” And Potts was not

“surprised” to learn of their relationship. Whitman also complained to Philpot and

Potts when he learned that McCarty was giving loads to a competitor. For example,

he once rhetorically asked Philpot, “[W]hat am I paying him for[?]” In the light of

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this record, the district court could have reasonably found that McCarty

participated in similar conversations.

      McCarty conferred with Philpot and Potts about the progress of the

investigation. After investigators searched the office, Philpot and Potts agreed that

“one of [them] needed to call [McCarty]” and “give him a heads up.” The three

coworkers then met several times to discuss the status of the investigation. At one

meeting, McCarty said that “all they had on him was a four-wheeler and a

Mustang, and he wasn’t going to prison for that.”

      All three government employees were aware of and facilitated the ongoing

criminal conduct of their coworkers. All three employees worked in a small office,

enjoyed catered lunches together that were purchased by Whitman, and saw

Whitman speaking privately to the other participants when he visited the office. As

his supervisor, Philpot also reviewed McCarty’s work, identified activity, like short

loading, that was similar to his own fraudulent activity, and failed to take any

corrective action—even though other employees’ work was “for the most part

correct.” Philpot testified that he “figured [McCarty] was doing pretty much the

same thing [he] was doing,” and that “[he] did not want to get him in trouble, and

[he] didn’t want [him]self to get in trouble either.” And Whitman once invited both

Philpot and McCarty to a bachelor party in Biloxi, Mississippi at Whitman’s

expense and gave them money to gamble.

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      McCarty contends that there was insufficient evidence to infer an agreement

because Whitman approached the employees separately, and they ordinarily did

not discuss with each other the specific details of their individual dealings with

Whitman. We disagree.

      To be sure, Philpot and Potts testified that they never spoke with McCarty

about their arrangement with Whitman because they “knew that it was . . . illegal”

or “wrong,” but an agreement may be “implicit,” U.S.S.G. § 1B1.3, cmt. n.3(B),

and not every participant in a jointly undertaken criminal scheme must know every

detail of the others’ participation. It is enough that McCarty was “fully aware of

the objective of the [scheme] and was actively involved in [it].” United States v.

McCrimmon, 362 F.3d 725, 732 (11th Cir. 2004); see also id. at 733 (“He was

certainly not a low-end operative merely aware that he was participating in some

sort of criminal ring—his knowledge and participation far exceeds that

description.”). The district court did not clearly err when it calculated McCarty’s

Guidelines range using the total loss caused by the criminal scheme.

                                IV. CONCLUSION

      We AFFIRM Whitman’s conviction and McCarty’s sentence.

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