Court Opinion

ID: 185056
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:27:04+00
Date Added: 2024-06-11T17:26:12.864166
License: Public Domain

198 F.3d 973 (D.C. Cir. 2000)
United States of America, Appelleev.Jeffrey M. Robinson, Appellant
No. 98-3100
United States Court of AppealsFOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued October 26, 1999Decided January 18, 2000

Appeal from the United States District Court for the District of Columbia(97-185-01)
Evelina J. Norwinski, Assistant Federal Public Defender,  argued the cause for appellant.  With her on the briefs was  A.J. Kramer, Federal Public Defender.
Barbara A. Grewe, Assistant U.S. Attorney, argued the  cause for appellee. With her on the brief were Wilma A.  Lewis, U.S. Attorney, and John R. Fisher and Blanche L.  Bruce, Assistant U.S. Attorneys.
Before:  Silberman, Williams, and Randolph, Circuit  Judges.
Opinion for the Court filed by Circuit Judge Randolph.
Randolph, Circuit Judge:

1
Lacking schools for emotionally  disturbed teenagers, the District of Columbia contracted for a  new school to be run by someone with a criminal record and  without any educational credentials.  The someone was Jeffrey Robinson, a 26-year-old insurance broker.  Despite having no college degree and no experience in education, he  obtained a contract to found the Kedar Day School.  His  qualifications?  He had once been a special education student  himself.  The District canceled the contract after discovering  that Robinson had paid for fancy cars, a lavish party and  other personal luxuries with city money earmarked for the  school.  A jury found Robinson guilty of ten counts of wire  fraud, 18 U.S.C.  2 and 1343, and one count of bank fraud,  18 U.S.C.  1344.  The district court imposed a sentence of  37 months, including a two-level upward adjustment for  "abuse of a position of trust," U.S.S.G.  3B1.3.  It ordered  restitution totaling $301,910.63.  Robinson has appealed his  sentence, contesting the abuse of trust enhancement to his  sentencing level and the amount of restitution.

2
* In August 1995, Robinson signed a contract with the District of Columbia Public Schools ("DCPS") to set up and  operate a school for up to fifty emotionally disturbed students.  Pursuant to its policy of providing appropriate, publicly supported education for emotionally disturbed students  residing in the District, DCPS places such students in private  schools when no adequate special education program is available within the school system.  In such cases, DCPS pays the  costs of tuition and related services for the private placement. See Presentence Report p 4, at 3.

3
Under the contract with DCPS, Kedar was to educate the  students and provide related services, including speech therapy, occupational therapy, physical therapy, clinical psychology  and social work.  See Presentence Report p 6, at 4.  Robinson negotiated for the school--which he named the Kedar Day  School--to receive $15,000 per year for each student attending.  Under the agreement, Robinson would bill DCPS for  tuition costs by submitting invoices listing the number of  students Kedar educated each month.

4
From the beginning, Robinson's agreement with DCPS was  laced with fraud.  To get the contract, he indicated that he  had already secured a location for the school, when in fact no  such agreement existed.  Days before the school was set to  open, Robinson arranged to lease part of a former DCPS  school building.  Robinson was able to secure that lease by  having Kedar's business manager represent that Kedar had  obtained the necessary liability insurance, another complete  fabrication.

5
To pay expenses the school incurred before receiving payment, Robinson contracted with the Prinvest Corporation, a  financing company, which allowed him to borrow money  against the invoices submitted to DCPS.  Prinvest would give  Robinson 80% of the invoice amount, less its fees and DCPS  would forward the checks directly to Prinvest.  DCPS would  turn over the remaining 20% to Robinson.

6
Robinson sent the first invoice to DCPS in September 1995,  claiming 49 students attended Kedar that month.  In fact,  Kedar had at most 25 to 30 students that month but Robinson  told the secretary who prepared the invoice to raise the  number so that the school would have "start up funds."  For  each of the invoices that followed, Robinson also had the  secretary inflate the number of students.  Invoices submitted  by Kedar during the months it was in operation totaled  $407,900, all of which DCPS duly paid.

7
Very little of that money went to school expenses.  Two  days after Prinvest wired its first payment of approximately  $60,000 to Kedar's account, Robinson withdrew nearly three  quarters of that amount for personal expenditures, including  lease payments on two Mercedes Benz automobiles, a Ferrari, and a BMW.  Meanwhile, Robinson told the Kedar staff  he lacked the money to pay them, blaming the D.C. government for the hold up, and refused to hire the professional counseling staff the contract required.  In October, Prinvest  wired about $48,000 into the Kedar account, more than half of  which Robinson spent on expenses unrelated to the Kedar  School.  In the months that followed, Robinson continued the  pattern of siphoning off Kedar funds for his own expenditures.  In December, he used money from the Kedar account  to throw himself an expensive birthday party at the Four  Seasons Hotel, inviting the Kedar staff to come and meet his  "millionaire friends."  School funds also went toward paying  rent and a security deposit on an office for Robinson's  insurance business.

8
Kedar's expenses continued to go unpaid;  the staff began  to leave and the students went unfed.  On some occasions the  children were sent home because of understaffing.  At other  times, the supervision was poor, so poor one student was seen  leaving via an open window.  At no time did Kedar provide  the educational and counseling services required under the  DCPS contract.  The students at Kedar had severe psychological problems;  among them were victims of sexual abuse,  physical abuse and others suffering from a variety of behavioral disorders.  In need of long term, intensive psychological  services, they were supposed to receive psychological counseling, speech language therapy, and occupational and physical  therapy.  But unlike the idealized biblical village that must  have inspired the school's name, see Song of Solomon 1:5  (King James);  Isaiah 21:16 (King James), Kedar--as the  government aptly describes it--was basically a "warehouse"  for the children, with students and teachers "just sitting  around."  Brief for Appellee at 20.

9
Robinson's scheme finally fell apart in March 1996 after he  persuaded Prinvest to allow him to pick up Prinvest's check  for $47,000 from DCPS and deliver it to Prinvest's D.C. office. The check never arrived.  Instead, Robinson convinced a  teller at Industrial Bank that Prinvest was one of the companies he owned and deposited the check in Kedar's account. Failing to receive the check as promised, Prinvest ended its  agreement with Robinson.  Shortly thereafter, DCPS learned  of the Prinvest incident, terminated its contract with Robinson, and took over operation of the Kedar school.

10
A federal grand jury indicted Robinson on eleven counts of  defrauding the District school system.  Ten counts related to  the wire transfers to Kedar's account and one related to his  theft of the Prinvest check.  After a few hours of deliberation,  a jury found Robinson guilty on the ten counts of wire fraud  and on the following day, reached a guilty verdict on the bank  fraud charge.  At sentencing, the district court adjusted  Robinson's base offense level upward nine levels, because the  loss amount exceeded $350,000, see U.S.S.G.  2F1.1(b)(1)(J),  and another two levels for more than minimal planning, see  U.S.S.G.  2F1.1(b)(2)(A).  Finding that Robinson had  abused a position of trust, see U.S.S.G.  3B1.3, the court  added a two-level increase, bringing the total adjusted level to  19, with a range of 30 to 37 months.  The judge sentenced  Robinson at the top of the range, noting with regret, "I think  that 37 months for this, for the crimes that were committed,  is not significant enough....  If I had had the authority ...  your sentence would be substantially more than 37 months-substantially more."  As for restitution, the district court  ordered Robinson to pay $301,910.63.

II

11
To comprehend Robinson's complaint about the two-level  upward adjustment for abuse of a position of trust, we need  to look at the sentencing transcript.  The critical passage is  the one in which the sentencing judge adds up each of the  enhancements to arrive at Robinson's adjusted offense level.Citing paragraph 27 of the presentence report, the judge  imposed the two-step adjustment to the base offense level  "because of Mr. Robinson's unique position as president of  Kedar School, and because of that unique position, that  significantly facilitated the commission of that bank-fraud  count."  The statement can only be interpreted in reference  to the section of the presentence report the judge cited and  earlier exchanges during the sentencing hearing.  Although  the presentence report is under seal, we can reveal that  paragraph 27 recommends an adjustment pursuant to  U.S.S.G.  3B1.3 based on Robinson's abuse of his position at the Kedar School. Elsewhere the report strikes the same  theme.

12
The government argued that Robinson should receive a  two-level increase because of his unique position with the  Prinvest Corporation, which facilitated theft of the $47,000  check.  The judge went on to distinguish the government's  position from that taken by the probation office in the presentence report, remarking that the two were not inconsistent. Later, when questioning the probation officer, the judge again  inquired and was told that the two theories were not inconsistent.  The phrasing of the judge's reasoning in imposing the  enhancement makes sense in view of his focus on ensuring  that the two theories were not at odds.  His specific reference  to the presentence report further signifies his reliance on the  probation office's sentencing recommendations.  We are  therefore persuaded that the statement, imposing the adjustment "because of Mr. Robinson's unique position as president  of Kedar School, and because of that unique position, that  significantly facilitated the commission of that bank-fraud  count," was intended to encompass both theories presented to  the court.

13
The question is whether the enhancement was justified on  either account.  A two-level upward adjustment must be  entered "[i]f the defendant abused a position of public or  private trust ... in a manner that significantly facilitated the  commission or concealment of the offense."  U.S.S.G.   3B1.3.  Application of the provision requires the sentencing  judge to inquire "(1) whether the defendant occupied a position of trust;  and (2) whether the defendant abused that  position in a manner that significantly facilitated the commission or concealment of the offense."  United States v. West,  56 F.3d 216, 219 (D.C. Cir. 1995).

14
"Public or private trust," the commentary guidelines explain, "refers to a position of public or private trust characterized by professional or managerial discretion."  U.S.S.G.   3B1.3 application note 1.  The position of trust must have  made the detection of the offense or the defendant's responsibility for the offense more difficult.  See id.  It would apply, for example, to "a bank executive's fraudulent loan scheme"  but not to a "theft by an ordinary bank teller" because that  position is not characterized by professional or managerial  discretion.  Id.  In United States v. Shyllon, we embraced  the following factors to guide us in determining whether a  particular position constitutes a position of trust:

15
The extent to which the position provides the freedom to commit a difficult-to-detect wrong, and whether an abuse could be simply or readily noticed;  defendant's duties ascompared to those of other employees;  defendants' level of specialized knowledge;  defendant's level of authority in the position;  and the level of public trust.

16
10 F.3d 1, 5 (D.C. Cir. 1993) (citing United States v. Queen, 4 F.3d 925, 928-29 (10th Cir. 1993)).  Using this approach, we  conclude that as president of the Kedar School, Robinson did  occupy a position of public trust.

17
The D.C. Public Schools selected Robinson to found and  operate a school for its most severely emotionally disturbed  students.1  Paid for with city funds, the school was expected  to fulfill the District's obligation to provide a free public  education to all local school children.  Parents of students  attending Kedar rightly expected that their children would  receive the education and counseling services they sorely  needed.  Because Robinson was the founder and director of  the school, he gained the public trust of the community that  Kedar served.  See United States v. Booth, 996 F.2d 1395,  1397 (2d Cir. 1993) (finding that status as a public school  teacher constitutes a position of trust);  United States v.  Pigno, 922 F.2d 1162, 1164 (5th Cir. 1991) (holding that school  superintendent occupied a position of trust, making adjustment for abuse of public trust appropriate).

18
In that regard, the extraordinary level of discretion given  to Robinson in managing the day-to-day operations and finances at Kedar is hard to believe, particularly in light of his  non-existent qualifications.  Kedar was located in a building  separate from any of the District's other public schools.  As a  result, supervision of operations at Kedar occurred only  through periodic visits from DCPS special education monitors.  These monitors, who visited Kedar a total of three or  four times, were responsible for assessing the school's compliance with federal law mandating that disabled students receive the educational and counseling services they require. See 20 U.S.C.  1412.  Monitoring did not include a review of  Kedar's financial records. Robinson had full control over the  invoices he submitted, enabling him to inflate the number of  students with little fear of discovery.  Further facilitating his  scheme, Robinson had sole access to Kedar's checking account at Industrial Bank.  He had complete discretion in  hiring staff for Kedar and in setting its curriculum.  His  authority over the school's employees was absolute.  In his  capacity as president of Kedar School, and in view of the  broad managerial discretion that afforded, we find Robinson  did occupy a position of public trust within the meaning of  U.S.S.G.  3B1.3.  See, e.g., United States v. Becraft, 117 F.3d 1450, 1452-53 (D.C. Cir. 1997) (affirming abuse of trust  enhancement where office manager's final authority over  ordering and marketing activities facilitated scheme to defraud her employer).

19
Robinson abused that trust by misappropriating school  funds and cheating emotionally disturbed children out of an  education.  Instead of paying for textbooks and school  lunches, the DCPS money went toward promoting Robinson's  profligate lifestyle.  His scheme to defraud the District of  Columbia government could not have been completed but for  Robinson's position as president and founder of the Kedar  School.  He controlled the billing process, was subject to little  supervision from DCPS, and was the only person with access  to Kedar's account.  By diverting the school's money to  expenditures unrelated to Kedar, Robinson exploited the role  entrusted to him, to the detriment of both the D.C. public schools and its neediest students.  See id.;  United States v.  Broumas, 69 F.3d 1178, 1181-82 (D.C. Cir. 1995) (holding  bank director abused position of trust by using privileges of  position to execute check-kiting scheme).

20
We are obliged to give due deference to the district court's  application of the Sentencing Guidelines to the facts of this  case.  See 69 F.3d at 1180-81 (citing United States v. Kim, 23 F.3d 513, 517 (D.C. Cir. 1994)).  Doing so, we find the district  court's decision to impose an abuse of trust adjustment on  account of Robinson's position at the Kedar School wholly  appropriate. Because affirmance on this ground is sufficient,  we do not decide whether the circumstances surrounding  conversion of the Prinvest check would similarly warrant a  two-step adjustment.

III

21
The district court awarded restitution in the amount of  $301,910.63 to compensate the losses of DCPS and thirteen  individuals.  That amount, the government concedes, should  be decreased by $13,000 to reflect money Robinson withdrew  but later returned to the Kedar checking account.  See Brief  for Appellee at 45.  Before oral argument, Robinson withdrew his objection with respect to the sum used for his  personal expenses but still objects to the amount designated  for unpaid rent and for victims other than DCPS.  Robinson  believes the money owed to Kedar employees and vendors  should be paid out of the restitution awarded to DCPS;otherwise he claims, the court double counts these expenses.

22
His objections were never raised at sentencing.  When he  argued against restitution in the district court, Robinson  objected only to his having to reimburse money that actually  went toward Kedar School's expenses.  That amount was not  included in the restitution award approved by the district  court.  Robinson failed to refute the restitution figures, recited in the presentence report, regarding the individual parties  and he did not contest the inclusion of unpaid rent and  salaries.  The judge was therefore permitted to rely on the  figures set out in the presentence report without requiring the government to present additional evidentiary support.  See United States v. Booze, 108 F.3d 378, 381-82 (D.C. Cir.  1997).  As a result, Robinson's objections on appeal are  subject only to plain error review.  See Fed. R. Crim. P. 52(b);United States v. Wolff, 195 F.3d 37, 40 (D.C. Cir. 1999);United States v. Saro, 24 F.3d 283, 287-88 (D.C. Cir. 1994).

23
Robinson's double counting argument does not make out a  case of plain error.  The DCPS contract was for educational  services;  hiring staff and procuring supplies was Robinson's  responsibility.  By violating that contract, Robinson now owes  DCPS the amount it paid that was not used to provide the  contracted-for-services.  In other words, he must reimburse  DCPS for all funds not used to educate students referred to  the Kedar School.  DCPS, by contrast, has no obligation nor  agreement with Kedar's staff or vendors.  Robinson alone is  responsible for the losses of DCPS and Kedar's employees. It does not follow that DCPS should then pay the salaries and  expenses of the Kedar School.  For similar reasons, the  unpaid rent should not be deducted from the diverted school  expenses.  The lease contract was independent of the school  contract.  As the government's brief rightly points out, had  Robinson chosen to lease property not owned by the District,  surely DCPS would not be held accountable for that property  owner's loss.  See Brief for Appellee at 17 n.12.  Because  Robinson cannot establish plain error, we uphold the order of  restitution but direct that it be reduced by $13,000 to correct  a computational error the government admirably has brought  to our attention.

24
Affirmed in part, modified in part.

Notes:

1
 Students attending the Kedar School were classified by the  District of Columbia State Education Agency as seriously emotionally disturbed.  Categorized as Level 4 DCPS special education  students, they had needs that could not be accommodated by  traditional neighborhood schools.  See Presentence Report p 5, at 3.