Court Opinion

ID: 4502121
Source: CourtListenerOpinion
Date Created: 2020-01-28 16:00:18.235421+00
Date Added: 2024-06-11T15:04:09.464834
License: Public Domain

In the

    United States Court of Appeals
                 For the Seventh Circuit
                     ____________________
No. 18-3270
UNITED STATES OF AMERICA,
                                                   Plaintiff-Appellee,
                                 v.

JOEL J. HELDING,
                                               Defendant-Appellant.
                     ____________________

         Appeal from the United States District Court for the
                   Western District of Wisconsin.
            No. 3:18-cr-39 — William M. Conley, Judge.
                     ____________________

  ARGUED NOVEMBER 7, 2019 — DECIDED JANUARY 28, 2020
               ____________________

   Before HAMILTON, SCUDDER, and ST. EVE, Circuit Judges.
    SCUDDER, Circuit Judge. Police seized 143.7 kilograms of
marijuana from Joel Helding’s car and apartment, and he
pleaded guilty to possessing over 100 kilograms. But at sen-
tencing, the district court held him responsible for the equiv-
alent of 4,679.7 kilograms—over 32 times the amount seized.
The additional quantity was based solely on the Presentence
Investigation Report’s account that confidential informants
told law enforcement Helding was dealing significant
2                                                 No. 18-3270

quantities of methamphetamine during the relevant period.
The drug quantity determination had a sizeable eﬀect on
Helding’s advisory guidelines range, and it drove his ultimate
sentence of 18 years’ imprisonment.
    A sentencing court acts within its discretion when it cred-
its confidential informants’ statements about drug quantity,
but when a defendant objects, the evidence supporting that
quantity must be found to be reliable. While that step may
prove modest, it needs to be taken, lest a defendant face the
risk of being sentenced on the basis of unreliable information.
The statements here, without more, fell short of that thresh-
old. So we reverse and remand for resentencing.
                               I
                              A
    In January 2018, a confidential informant told Wisconsin
law enforcement that Joel Helding and his now-wife, Valerie
Flores, planned to drive a substantial amount of methamphet-
amine from California to Wisconsin. Law enforcement used
the informant’s tip to obtain a court order to track Flores’s
phone and thereby monitor the pair’s location as they drove.
Once Helding and Flores arrived in Wisconsin, state police
stopped and apprehended them. The oﬃcers then seized
143.7 kilograms of marijuana from Helding’s car, while also
finding him in possession of two firearms, a 9mm Smith &
Wesson and a Ruger LCP .380. A subsequent search of his
apartment, undertaken pursuant to a warrant, further uncov-
ered 15.2 grams of marijuana and digital scales containing
methamphetamine residue.
   A grand jury charged Helding with possessing and in-
tending to distribute more than 100 kilograms of marijuana,
No. 18-3270                                                  3

21 U.S.C. § 841(a)(1), and possessing a firearm in furtherance
of drug traﬃcking, 18 U.S.C. § 924(c). Helding pleaded guilty
to both counts, which subjected him to a mandatory mini-
mum sentence of 15 years’ imprisonment—ten for the drug
oﬀense and five consecutive for firearm possession.
                              B
    Under the Sentencing Guidelines, quantities matter in
drug cases. The higher the quantity of drugs attributed to the
defendant, the higher his oﬀense level, and in turn the higher
his sentencing range. See U.S.S.G. § 2D1.1(c). Helding’s case
provides a stark illustration.
    The U.S. Probation Oﬃce prepared a Presentence Investi-
gation Report (often shorthanded PSR) in advance of sentenc-
ing. In determining drug quantity, the PSR recommended
holding Helding accountable for not only the 143.7 kilograms
of marijuana that police found in his car and apartment, but
also additional quantities based on an application of the rele-
vant conduct rule in the Sentencing Guidelines. See U.S.S.G.
§ 1B1.3(a)(1)(B) (explaining that for guidelines purposes,
where a defendant jointly undertakes criminal activity, the
relevant conduct includes all reasonably foreseeable acts and
omissions within the scope of and in furtherance of the crime).
The application of that rule here meant that the drug quantity
determination needed to account for Helding’s dealing of
both marijuana and methamphetamine.
    Methamphetamine quantities entered the PSR through in-
formation provided to law enforcement by five confidential
sources (and presumably passed to the probation oﬃcer by
the prosecutor or case agent). According to the PSR, the con-
fidential informants, or CIs, stated that they bought
4                                                 No. 18-3270

methamphetamine from Helding several times and relayed
information on the quantities, prices, and frequency of those
transactions. The PSR reported that CI-1 told law enforcement
Helding possessed “over a pound” of methamphetamine on
December 16, 2017, and had fronted the informant with a cou-
ple of ounces every day or two for two months. CI-1 sold the
methamphetamine to others, returned a portion of the pro-
ceeds to Helding, and kept the balance as profit. The PSR like-
wise attributed to CI-1 descriptions of Helding’s vehicles and
apartment as well as information that Helding supplied meth-
amphetamine to customers in Merrill and Wausau, Wiscon-
sin. In much the same way, the PSR included information
from CI-2—specifically, that this individual saw Helding sell
“multiple ounces” of methamphetamine on three occasions
for $500 per ounce.
    So, too, did the PSR include information from three other
confidential sources. One of them, CI-1082, was the informant
who originally told law enforcement about Helding’s trip
from California to Wisconsin under the mistaken belief that
Helding and Flores were transporting methamphetamine in-
stead of marijuana. The PSR also quoted CI-3 as telling law
enforcement that Helding once traded a half-ounce of meth-
amphetamine for a gun. And the PSR quoted CI-987 as saying
that Flores regularly sold the informant methamphetamine
for $40 to $60 per eighth of an ounce.
    From this information the probation oﬃcer estimated that
Helding possessed and intended to distribute at least 64
ounces of methamphetamine during the relevant period.
Where a defendant’s conduct involves both marijuana and
other drugs, the Sentencing Guidelines convert those drugs
into a marijuana equivalency for drug quantity purposes. See
No. 18-3270                                                                5

U.S.S.G. § 2D1.1 cmt. 7, 8(B). So, in preparing the PSR here,
the probation oﬃcer converted the methamphetamine and
added it to the 143.7 kilograms of seized marijuana. Helding’s
drug quantity shot up to 4,679.7 kilograms of marijuana.
    Helding’s advisory sentencing range likewise jumped
through the roof. If he had been responsible for just the 143.7
kilograms of marijuana seized, his oﬀense level would have
been 26 and his sentencing range 120 to 150 months for the
drug oﬀense. Add to that the five-year minimum he faced for
the gun oﬀense, and Helding’s total range would have been
180 to 210 months. But when the drug quantity skyrocketed
to 4,679.7 kilograms of marijuana, Helding’s oﬀense level in-
creased to 32 and his sentencing range to 210 to 262 months.
Adding the five years for the firearm oﬀense, Helding’s total
range became 270 to 322 months. Put most simply, the spike
in drug quantity increased the advisory range by over seven
years.
   This table shows the impact:
                    Drug         Oﬀense   Sentencing    Total Sentencing
                    Quantity     Level    Range for     Range for Drug
                                          Drug Oﬀense   and Firearm
                                          Alone         Oﬀenses

 Seized             143.7 kg     26       120 to 150    180 to 210
 Quantity Only      marijuana             months        months

 Seized Quantity    4,679.7 kg   32       210 to 262    270 to 322
 Plus Relevant      marijuana             months        months
 Conduct Quantity

    Helding objected to the PSR’s inclusion of the metham-
phetamine, arguing that nothing corroborated what the CIs
reportedly told law enforcement. Nor, he added, did the PSR
include any explanation of why law enforcement found the
CI information credible. Helding’s objection was clear: the
6                                                 No. 18-3270

case involved no controlled buys with any CI, and the search
of his apartment revealed only residual amounts of metham-
phetamine consistent with personal use.
    Helding was right that the PSR said nothing about the re-
liability of the informants. Nowhere was there any descrip-
tion of their past work with law enforcement, their criminal
history, the reliability of the accounts they had provided be-
fore, or whether and why the case agents believed the infor-
mation provided to the probation oﬃce was reliable.
    The probation oﬃce rejected Helding’s objection in an ad-
dendum to the PSR. The addendum explained that the proba-
tion oﬃce did not have the means or the responsibility to in-
vestigate witness credibility. It stated that only CI-1 and CI-
2’s statements factored directly into the drug quantity calcu-
lation, because those statements were detailed enough to in-
clude the dates and quantities of Helding’s alleged metham-
phetamine sales. On the basis of this information, the PSR cal-
culated Helding’s advisory range based upon a drug quantity
of 4,679.7 kilograms of marijuana—an amount the probation
oﬃcer saw as “conservative” in light of the accounts of CI-1
and CI-2 supplied by law enforcement. In the end, however,
the addendum observed that the drug quantity finding would
have no impact on the guidelines calculation because of
Helding’s status as a career oﬀender.
                              C
    Sentencing began with the district court determining
Helding’s advisory guidelines range. Helding again objected
to the PSR’s inclusion of methamphetamine in the drug quan-
tity determination, disputing the accuracy of the CI-supplied
information about his methamphetamine sales. The district
No. 18-3270                                                    7

court overruled the objection, finding that the government
had shown Helding’s possession of methamphetamine by a
preponderance of the evidence. The court reasoned this way:
   Indeed, as to the quantities, both confidential inform-
   ants were able to provide specific information related
   to the defendant’s involvement in sales of drugs, in-
   cluding dates and quantities. Absent contrary evi-
   dence, therefore, I overrule that objection.
The sentencing judge also observed that three other CIs had
provided information regarding Helding’s possession of
methamphetamine, even though their accounts did not di-
rectly factor into the drug quantity calculation.
    The district court turned next to Helding’s criminal his-
tory and found that his two prior felony drug convictions
made him a career oﬀender. Helding’s career oﬀender status
meant his guidelines oﬀense level automatically became 37
regardless of any drug quantity determination. See U.S.S.G.
§ 4B1.1. The court found that Helding’s career-oﬀender sen-
tencing range was 322 to 387 months. From there the district
judge recognized that, under our decision in United States v.
Corner, 598 F.3d 411 (7th Cir. 2010), the court had discretion to
refrain from sentencing in strict accordance with the career-
oﬀender guideline. Corner provides that, while a district court
must consider the benchmark set by the career-oﬀender
guidelines, the sentencing judge retains the discretion to dis-
agree with and deviate from them on policy grounds. See id.
at 415–16.
   The district court exercised that discretion by considering
what Helding’s guidelines range would have been if he were
not a career oﬀender. The court found that Helding’s non-
8                                                   No. 18-3270

career-oﬀender base oﬀense level was 32. It then made a few
adjustments—a two-level increase because Helding main-
tained a premises for drug traﬃcking, see U.S.S.G.
§ 2D1.1(b)(12), and a three-level decrease because he accepted
responsibility, see id. § 3E1.1—to arrive at a total oﬀense level
of 31. Upon accounting for Helding’s firearm oﬀense—and
the 60-month minimum sentence mandated by 18 U.S.C.
§ 924(c)—the court determined that Helding’s non-career-of-
fender guidelines range was 248 to 295 months.
   The district court took one final step. Recall that Helding
faced a total mandatory minimum sentence of 180 months (15
years) for his marijuana and firearm convictions. See 18 U.S.C.
§ 924(c); 21 U.S.C. § 841(a)(1). The court compared Helding’s
non-career-oﬀender range to this statutory 180-month mini-
mum and decided that a sentence somewhere in between was
appropriate. The court therefore sentenced Helding to 216
months—about halfway between the 180-month mandatory
minimum and the lower end of the 248-month non-career-of-
fender range.
    Helding now appeals. He emphasizes the importance of
the drug quantity determination to his sentence and urges us
to hold that the district court needed to do something to find
the CI information dependable before relying on it to select an
appropriate sentence.
                               II
    Our reading of the sentencing transcript leaves us with the
impression that the district court overruled Helding’s objec-
tion because the information supplied by the CIs was de-
tailed. While the observation appears accurate, the reasoning
came very close to the district court saying it credited the CI
No. 18-3270                                                  9

information because of its inclusion in the PSR. What con-
cerns us is that this reasoning prevailed over Helding’s objec-
tion, with no step being taken to find some modicum of relia-
bility of the CI information supplied to the probation oﬃcer
charged with preparing the PSR.
    More to it, nowhere did the PSR contain any infor-
mation—even a representation by law enforcement—that the
informants’ statements were known to be reliable. CI-1 and
CI-2 specified the dates and quantities of Helding’s alleged
drug sales, but specificity alone, in the face of a defendant’s
objection, does not make information reliable. The court
pointed to no other evidence to support the inclusion of meth-
amphetamine in Helding’s drug quantity. Nor did the court
explain why the CI information in the PSR, standing alone,
was suﬃcient to support such a substantial increase in the
drug quantity finding.
    Perhaps recognizing this shortcoming in the sentencing
record, the government urges us to conclude any error in the
district court’s drug quantity finding was harmless given
Helding’s status as a career oﬀender. We decline the invita-
tion. After finding that Helding qualified as a career oﬀender,
the district court then pivoted, invoked the discretion we rec-
ognized in Corner, and ultimately imposed a sentence driven
almost exclusively by the guidelines range resulting from the
drug quantity finding. In these circumstances—where the ex-
ercise of Corner discretion sidelined the career oﬀender guide-
line—we cannot agree that any error with the drug quantity
finding was harmless. It is impossible to read the sentencing
transcript and not recognize the massive influence the drug
quantity finding had on Helding’s sentence.
10                                                   No. 18-3270

    This factual reality has a legal consequence too. A criminal
defendant has a due process right to be sentenced based on
accurate information. See United States v. Tucker, 404 U.S. 443,
447 (1972). Reliability is a central ingredient of the due process
analysis: where the district court sentences a defendant based
on the drug-quantity guidelines, it must find the govern-
ment’s information suﬃciently reliable to determine drug
quantity by a preponderance of the evidence. See United States
v. Lister, 432 F.3d 754, 762 (7th Cir. 2005). We have emphasized
that where a district court relies on evidence that substantially
increases drug quantity, it must take care in determining the
accuracy of that evidence. See United States v. Morrison, 207
F.3d 962, 967 (7th Cir. 2000). And all of this is so where, as
here, a district court is exercising the discretion recognized in
Corner. See Corner, 598 F.3d at 415 (explaining that “district
judges are at liberty to reject any Guideline on policy
grounds—though they must act reasonably when using that
power”).
    We have underscored these due process safeguards in ad-
dressing previous challenges to the reliability of CI infor-
mation included in a PSR. Take, for example, United States v.
Marks, 864 F.3d 575 (7th Cir. 2017). There we recognized the
general rule that “a sentencing judge may rely on a presen-
tence report if it is well-supported and appears reliable.” Id.
at 580 (collecting prior cases highlighting the same general
rule). Under those circumstances, the defendant bears the
burden of coming forward with facts demonstrating that the
information in the PSR is inaccurate or unreliable. See id.; see
also United States v. Sunmola, 887 F.3d 830, 839 (7th Cir. 2018)
(“Only when the defendant’s objection creates real doubt as
to the reliability of the information in the PSR does the
No. 18-3270                                                    11

government have the burden of independently demonstrat-
ing the accuracy of the information.”).
    But in Marks we also took care to caution that where these
reliability attributes are altogether absent and the PSR instead
asserts “nothing but a naked or unsupported charge,” the de-
fendant’s denial of that information suﬃces to cast doubt on
its accuracy. Marks, 864 F.3d at 580; see also United States v.
Moreno-Padilla, 602 F.3d 802, 809 (7th Cir. 2010) (describing sit-
uations in which the general rule does not apply, such as
where the PSR omits crucial information).
    This exact consideration applies to Helding’s sentence
here. We have not held that a district court may credit a drug
quantity finding over a defendant’s objection where that
quantity was based solely on a confidential informant’s out-
of-court statements, without some further indicia of reliabil-
ity. We have come close to the issue at least twice. In United
States v. Smith, 280 F.3d 807 (7th Cir. 2002), we aﬃrmed a gun
enhancement that the defendant, Antwone Smith, contended
was imposed “solely on the uncorroborated, out of court
statement of an unidentified, confidential informant.” Id. at
810–11. But Smith was mistaken, as the record contained more
evidence to support the gun enhancement. A detective testi-
fied before the district court that he spoke to the CI immedi-
ately after the CI bought drugs from Smith and, in the course
of that conversation, the CI told the detective that Smith
pointed a gun at the CI. See id. at 809. A tenant of the house
where Smith sold drugs also testified that she had seen guns
there. See id. We considered these sources of corroboration in
aﬃrming the district court’s finding that the informant’s
statement was suﬃciently reliable. See id.
12                                                    No. 18-3270

    A second case implicating the issue was United States v.
Valdez, 739 F.3d 1052 (7th Cir. 2014). Arturo Valdez admitted
to possessing 700 grams of heroin, but at sentencing the dis-
trict court held him accountable for more than three kilo-
grams. See id. at 1052–53. Valdez objected to the drug quantity
calculation, arguing that it was improper for the district court
to rely on statements made by a CI and recounted in law en-
forcement reports. See id. at 1053. We aﬃrmed Valdez’s sen-
tence because the record contained information showing the
CI’s account was suﬃciently reliable: Valdez himself made
statements to law enforcement aligning with the information
in CI’s reports, even on small details like drug code words.
See id. at 1054–55.
    This case is unlike Smith and Valdez. Helding made no
statements about selling methamphetamine. The district
court saw no aﬃdavits, reviewed no reports from the case
agent, and heard no testimony from law enforcement han-
dlers or other witnesses corroborating the drug quantity in-
formation. The court relied solely on CI-1 and CI-2’s state-
ments as they were recounted in the PSR, which accounted
for over 96% of Helding’s drug quantity. And the probation
oﬃce is undoubtedly right that it is not equipped to assess the
reliability of information provided by law enforcement, at
least without either the ability to talk to the CIs or further cor-
roboration.
    To be sure, our prior cases do contain some broad lan-
guage describing the deference aﬀorded the district court’s
credibility determinations—even where a witness has a his-
tory of criminal activity or drug use, as is often the case for
informants in drug-related prosecutions. See, e.g., United
States v. Galbraith, 200 F.3d 1006, 1012 (7th Cir. 2000) (“[T]he
No. 18-3270                                                       13

trial court is entitled to credit testimony that is totally uncor-
roborated and comes from an admitted liar, convicted felon,
large scale drug-dealing, paid government informant.”) (in-
ternal quotations omitted); see also United States v. Harmon,
721 F.3d 877, 888–89 (7th Cir. 2013). Though the threshold for
a suﬃcient reliability finding may be low, it is not so low as
to be met in the face of a defendant’s objection by a confiden-
tial informant’s out-of-court statement unaccompanied by
any additional support.
    Facing an objection like Helding’s, the district court must
take some step to ensure that the CI-provided information has
a modicum of reliability. Cf. United States v. Robinson, 164 F.3d
1068, 1070 (7th Cir. 1999) (“While it’s not required that a judge
hear personally from witnesses under oath at a sentencing
hearing about drug quantities, we think it’s not a terribly bad
idea to do so when the witness is going to provide the basis
for, as here, 97 percent of a defendant’s relevant conduct.”). It
remains within the district court’s discretion to determine that
step. It may be enough for the government to supply the pro-
bation oﬃce, and, in turn, for the PSR to include, some state-
ment bearing on the reliability of information provided by a
confidential source. In other instances, the district court may
choose to request and review law enforcement reports con-
taining the CI’s reported information or information on the
CI’s reliability. In still others, the district court may find it ap-
propriate to receive testimony from the handling case agent.
Our observations in no way are intended to catalogue or pre-
scribe the available pathways. How to proceed with the relia-
bility inquiry and on what to base the reliability finding are
committed to the district court’s sound judgment.
14                                                 No. 18-3270

    But the sentencing record here did not contain enough to
find the CI-provided information suﬃciently reliable to influ-
ence Helding’s guidelines determination and ultimate sen-
tence. The district court exercised the discretion we recog-
nized in Corner and deviated from the career-oﬀender range,
only then to find Helding responsible for over 32 times the
amount of marijuana seized—a massive spike in drug quan-
tity—based only on statements made by confidential inform-
ants to law enforcement and memorialized in the PSR. In
these circumstances, that fell short of protecting a defendant’s
due process right to be sentenced on the basis of accurate in-
formation.
   Accordingly, we REVERSE and REMAND for resentenc-
ing.