Court Opinion

ID: 857820
Source: CourtListenerOpinion
Date Created: 2013-04-11 17:11:10.974976+00
Date Added: 2024-06-11T13:14:26.916732
License: Public Domain

United States Court of Appeals
                        For the First Circuit

No. 11-2371
                            UNITED STATES,

                              Appellee,

                                  v.

                       MARK STEPHEN PALMQUIST,

                        Defendant, Appellant.

             APPEAL FROM THE UNITED STATES DISTRICT COURT

                      FOR THE DISTRICT OF MAINE

          [Hon. John A. Woodcock, Jr., U.S. District Judge]

                                Before

                         Lynch, Chief Judge,
                       Boudin,* Circuit Judge,
                   and Woodlock,** District Judge.

     George T. Dilworth, with whom Drummond Woodsum was on brief
for appellant.
     Margaret D. McGaughey, Assistant United States Attorney, with
whom Thomas E. Delahanty II, United States Attorney, was on brief
for appellee.

                             April 11, 2013

     *
       Judge Boudin heard oral argument in this matter and
participated in the semble, but he did not participate in the
issuance of the panel’s opinion in this case. The remaining two
panelists therefore issued the opinion pursuant to 28 U.S.C.
§ 46(d).
     **
          Of the District of Massachusetts, sitting by designation.
       WOODLOCK, District Judge.       Mark Palmquist is a Marine Corps

veteran who worked as a civilian employee with the U.S. Department

of Veterans Affairs from 2004 to 2010.               He was convicted of fraud

in connection with his own receipt of veterans benefits.

       Adverting to Garrity v. New Jersey, 385 U.S. 493 (1967),

Palmquist challenges his conviction on grounds that statements he

made    during   an   interview       with       a    Veterans      Administration

investigator were coerced because they were induced by putting him

to a choice between loss of his job or surrender of his right to

remain silent under the Fifth Amendment and consequently should

have been suppressed.      Adverting to commentary accompanying the

sentencing guideline applicable to his offense, he challenges his

sentence on grounds that the restitution ordered should have been

offset by other benefits he might have claimed from the Veterans

Administration.       Finding    no   support        for   either   the   claim of

coercion or that of entitlement to benefits which could be used as

an offset to the restitutionary obligation, we decline to disturb

either the conviction or the sentence.

                                            I.

       On October 14, 2008, Palmquist filed a claim with the Veterans

Administration for increased service-related disability benefits

based on a back injury.         He had filed six prior claims for back

injury, all of which were denied because he could not establish

that the injury was service-related.             To support his October 2008

                                      -2-
application, which was granted, Palmquist supplied a government

memorandum purporting to establish that he sustained his injury in

connection with military service in Panama in 1988.                  The memo,

however, was a forgery, and no other evidence supported Palmquist’s

claim.    Before the Veterans Administration uncovered the fraud,

Palmquist received $37,440 in disability benefits to which he was

not entitled.

      Palmquist’s efforts to defraud the Veterans Administration, as

charged in the indictment, began long before 2008.                  Previously,

Palmquist    had   received      service-related   benefits    in    an   amount

contingent upon his claimed number of dependents.                    Palmquist

claimed as dependents Aurora Ra Williams-Enstrom, whom he married

in   2002,   and   her   minor    daughter.   Palmquist,      however,     never

notified the Veterans Administration that he divorced Williams-

Enstrom in 2003.         As a result, Palmquist received $9,789 in

dependency benefits to which he was not entitled.

      Palmquist was charged in a 27-count indictment with a variety

of offenses involving misconduct in his receipt of benefits from

the Veterans Administration.1 Pursuant to a plea bargain reserving

the right to appeal the denial of his motion to suppress the

statements he made to the Veterans Administration investigator, he

pled guilty to two counts:         knowingly submitting a false claim for

      1
       One count, not at issue here, also charged Palmquist with
making a false statement in an application for employment with
the Veterans Administration.

                                      -3-
Veterans Administration service-related benefits in violation of 18

U.S.C. § 287, and theft of Veterans Administration service-related

benefits exceeding $1,000 in violation of 18 U.S.C. § 641.      The

district court sentenced Palmquist to 18 months of imprisonment, 3

years of supervised release, $47,228 in restitution, and $200 in

special assessments.

                                II.

     Palmquist challenges the district court’s refusal to suppress

statements he made to Timothy Bond, a criminal investigator for the

Veterans Administration Office of the Inspector General.        The

statements may be taken to indicate that his use of the forged

memorandum was knowing and willful.2 In addressing Palmquist’s

suppression claim, we rely upon the facts as supportably found by

the magistrate judge and adopted by the district judge.

     On April 3, 2009, Bond interviewed Palmquist in Palmquist’s

office at the Togus Veterans Administration Hospital.      Veterans

Administration police officer Jeffrey Turner was also present for

     2
        The government, for its part, seeks in its briefing to
minimize the evidentiary importance of the statements Palmquist
made to Bond. According to the government’s version of the facts
in support of the guilty plea, Bond would have testified only to
Palmquist’s    admissions   about   his   knowledge    of   Veterans
Administration claims procedures, which would show that his conduct
was knowing and willful. Presumably, the government means to imply
that it could have made such a showing even without the statements
at issue, based on Palmquist’s rather extensive history of filing
claims with the Veterans Administration, not to mention that his
use of the forged memorandum was a fairly obvious act of deception.
In any event, because we conclude that the statements did not need
to be suppressed, we express no opinion regarding their evidentiary
significance.

                                -4-
the interview.   In keeping with Veterans Administration policy,

Bond did not record the interview, but he did take notes.

     Bond introduced himself to Palmquist as a member of the Office

of the Inspector General’s criminal investigation division, which

he confirmed by showing Palmquist his badge.   Bond explained that

he had received allegations of fraud, specifically concerning

Palmquist’s dependency benefits.     He also explained that the

interview was voluntary, and that Palmquist could not be punished

for refusing to answer questions.    Before asking any questions,

Bond presented Palmquist with a form that read:

                       ADVISEMENT OF RIGHTS
                  (FEDERAL EMPLOYEES – GARRITY)

     You are being contacted to solicit your cooperation in an
     official investigation regarding misconduct or improper
     performance of official duties. In accordance with the
     Privacy Act, you are advised that the authority to
     conduct this investigation is contained in the Inspector
     General Act of 1978, 5 U.S.C. App. 3.

     The matter under investigation could constitute a
     violation of law that could result in the criminal
     prosecution of the responsible individuals.

     This inquiry concerns ________________________________

     You have the right to remain silent if your answers may
     tend to incriminate you.    If you do decide to answer
     questions or make a statement, you may stop answering at
     any time.

     Anything you say may be used as evidence in both an
     administrative proceeding or any future criminal
     proceeding involving you.

     If you refuse to answer the questions posed to you on the
     grounds that the answers may tend to incriminate you, you
     cannot be removed (fired) solely for remaining silent;
     however, your silence can be considered in an

                               -5-
       administrative proceeding for any evidentiary value that
       is warranted by the facts surrounding your case.

                                     ACKNOWLEGEMENT

       I understand the      warnings and assurances stated above and
       I am willing to        make a statement and answer questions
       voluntarily. No       promises or threats have been made to me
       and no pressure       or coercion of any kind has been used
       against me.

In the blank space following “This inquiry concerns,” Bond wrote

“VA compens[at]ion benefits for Mark Palmquist.”                    The form was

signed by Palmquist and by Turner, as a witness.

       After summarizing the form for Palmquist, Bond gave Palmquist

an opportunity to review the form and to ask questions.                   Palmquist

looked only briefly at the form, but did not indicate any confusion

about Bond’s summary.           Bond concluded that Palmquist was satisfied

with       his   explanation,    and     observed   that   Palmquist      showed    no

reluctance in signing the form.

       During the interview, Palmquist seemed calm and cooperative.

Early in the interview, Palmquist briefly discussed his medical

problems--in addition to his back injury, Palmquist was being

treated for PTSD--and asked a question about a civil employment

discrimination        suit      he     had    pending   against     the    Veterans

Administration.3         Bond        again   reminded   Palmquist   that    he     was

involved in a criminal investigation, but asked if Palmquist wanted

       3
        The discrimination action has since been determined
adversely to Palmquist. Palmquist v. Shinseki, 689 F.3d 66 (1st
Cir. 2012), petition for cert. filed (U.S. Dec. 26, 2012) (No. 12-
789).

                                             -6-
his civil counsel present.           Palmquist declined and agreed to

continue the interview, which turned to the issue of benefits

fraud.       The entire interview lasted about 20 minutes, and ended

cordially.

       The     district     court,   adopting       a     magistrate    judge’s

recommendation, found that the statements Palmquist made to Bond

were    voluntary     and   accordingly    denied   Palmquist’s     motion   to

suppress.       We will uphold such a denial unless there is no

reasonable view of the evidence to support the determination.

United States v. Jadlowe, 628 F.3d 1, 13 (1st Cir. 2010), cert.

denied, 131 S. Ct. 1833 (2011).                We review the lower court’s

findings of fact for clear error, and its legal determinations de

novo.    United States v. Hughes, 640 F.3d 428, 434 (1st Cir. 2011).

       In Garrity v. New Jersey, 385 U.S. 493 (1967), the Supreme

Court prevented government entities from “us[ing] the threat of

discharge to secure incriminatory evidence against an employee.”

Id. at 499.       When an employee faces the choice “between self-

incrimination and job forfeiture,” the Court ruled, his statements

are deemed categorically coerced, involuntary, and inadmissible in

subsequent criminal proceedings.          Id. at 496-97.

       Not    every   possible   threat   of    adverse    employment   action,

however, triggers immunity under Garrity.               As we have observed:

       In all of the cases flowing from Garrity, there are two
       common features: (1) the person being investigated is
       explicitly told that failure to waive his constitutional
       right against self-incrimination will result in his
       discharge from public employment (or a similarly severe

                                     -7-
     sanction imposed in the case of private citizens); and
     (2) there is a statute or municipal ordinance mandating
     such procedure.

United States v. Indorato, 628 F.2d 711, 716 (1st Cir. 1980).

Garrity immunity is contingent upon the degree of certainty that an

employee’s silence alone will subject the employee to severe

employment sanctions.    So, for example, potentially unfavorable

inferences drawn from an employee’s silence, which serve as one

factor in adverse employment action against him, have been found

“too conditional” a threat to trigger Garrity immunity.     United

States v. Stein, 233 F.3d 6, 14 (1st Cir. 2000); see also id. at 16

(distinguishing “the threat of automatic loss of one’s livelihood

and the threat of an inference that might lead to such a loss”).

     Nothing that Bond said or presented to Palmquist could have

led Palmquist to believe that, if he remained silent, he would

automatically lose his job or suffer similarly severe employment

consequences solely for having remained silent.     The magistrate

judge credited Bond’s testimony that he accurately summarized the

Advisement of Rights.   The Advisement, in turn, informed Palmquist

that he could not be fired solely for refusing to participate in

the interview, although his silence could be used as evidence in an

administrative proceeding.   Under Stein, the consequences of such

a use of Palmquist’s silence are too conditional to be deemed

coercive.

     Whatever Palmquist may have read or been told at the time, he

                                -8-
argues   he    was   also   subject    to    coercion     under    the    Veterans

Administration Standards of Conduct, which provide:

      Employees will furnish information and testify freely and
      honestly in cases respecting employment and disciplinary
      matters.   Refusal to testify, concealment of material
      facts, or willfully inaccurate testimony in connection
      with an investigation or hearing may be ground for
      disciplinary action. An employee, however, will not be
      required to give testimony against himself or herself in
      any matter in which there is indication that he or she
      may be or is involved in a violation of law wherein there
      is a possibility of self-incrimination.

38   C.F.R.    §   0.735–12(b).     This     regulation    is     not   inherently

coercive, given that, read in full, it effectively precludes

automatic disciplinary action for an employee’s refusal to testify

“in any matter in which there is indication that he or she may be

or is involved in a violation of law wherein there is a possibility

of self-incrimination.”         In such a case the employee “will not be

required to give testimony.” The regulation thus makes exactly the

exception necessary to prevent the attachment of immunity under

Garrity.

      Our opinion in Sher v. U.S. Department of Veterans Affairs,

488 F.3d 489 (1st Cir. 2007), is not to the contrary.                  Sher did not

create   a    blanket    rule   that   employees      subject     to    38   C.F.R.

§ 0.735–12(b) are entitled to immunity under Garrity. In Sher, the

employee      received   letters   from      the   Veterans     Administration

reporting that criminal prosecution had been declined by the U.S.

Attorney and advising that “‘[e]mployees will furnish information

and testify freely and honestly in cases respecting employment and

                                       -9-
disciplinary matters.        Refusal to testify . . . in connection with

an   investigation    or    hearing       may    be    ground      for   disciplinary

action.’”    Id. at 502.       The letters, however, did not quote the

portion of     §   0.735-12(b)         indicating     that    an   employee      is    not

required to give testimony where there is a possibility of self-

incrimination.       Tellingly, then, the court said only that the

“notification”--i.e., the content of the letters and not the

regulation     itself--“was        a    threat    of     removal     sufficient        to

constitute coercion under Garrity.”              Id. (emphasis added).

      Moreover, the central question in Sher was not whether the

employee faced coercion sufficient to immunize his statements from

use in criminal prosecution under Garrity.                   Rather, Sher involved

what the court took to be obviously coercive letters to the

employee, upon which Garrity immunity automatically attached, and

addressed whether the employee received sufficient notice of his

Garrity immunity to justify using his silence in an administrative

failure-to-cooperate        charge.        The   court       in   Sher   thus    had    no

occasion to determine whether any employee obligated to cooperate

under 38 C.F.R. § 0.735–12(b) would be under such coercion that

Garrity   would    render    his       statements      inadmissible      in     criminal

prosecution.

      In any event, this case is distinguishable from Sher in

several other respects. Here, there is no indication Palmquist was

aware of the regulation at all, let alone that he was selectively

presented with the coercive portion of the regulation that would

                                         -10-
imply he “faced the loss of his job for refusal to testify.”                     Sher,

488   F.3d   at   502.      Moreover,       Bond    made    clear   that    he     was

investigating a criminal matter regarding benefits fraud, rather

than an “employment and disciplinary matter,” which would trigger

application of the regulation.

      Palmquist    also    argues    that    Bond    and,    alternatively,        the

Advisement of Rights misstated the law, thus rendering Palmquist’s

testimony    involuntary.         Bond’s    alleged       misstatement     was    that

Palmquist could not be punished for not answering questions.

According to Palmquist, this misstated the extent to which his

silence could be used against him in administrative proceedings.

Bond was plainly referring to Palmquist’s immunity from criminal

punishment    based   on    his   silence;     the    statement     is     thus    not

inconsistent with Bond’s later provision of an accurate summary of

the Advisement of Rights, which discusses the potential evidentiary

uses of silence.      This alleged inconsistency, if inconsistency it

was, does not give rise to any clear error such that we must reject

the   district    court’s    determination         that    Bond   summarized      the

Advisement of Rights form accurately.4

      4
       Moreover, any failure to inform Palmquist of adverse
employment consequences that could flow from his silence only
diminishes the likelihood that his statements were coerced by the
threat of adverse employment consequences. Cf. Dwan v. City of
Boston, 329 F.3d 275, 279 (1st Cir. 2003) (“[C]oercion is lacking
so long as the employee was never threatened or forewarned of any
sanction for refusing to testify.” (emphasis in original)).

                                      -11-
      Palmquist also complains that the warnings in the Advisement

of   Rights   are    inconsistent      with   model   warnings   provided     by

Department of Justice in its so-called “Wray Memorandum.”                Unlike

the OIG Advisement of Rights, the Garrity warning suggested by the

Wray Memorandum does not mention that an employee’s silence may be

used as evidence in an administrative or disciplinary proceeding.

Putting aside that nothing requires the Veterans Administration to

use the Department of Justice form, we have already observed that

potential use of Palmquist’s silence as evidence for what it is

worth is too conditional to constitute coercion.              Stein, 233 F.3d

at 14, 16.

      Palmquist makes no argument that his statements should have

been suppressed on more conventional voluntariness grounds, and the

record provides no such indication of coercion in any event.                  The

interview     was,   by   all   accounts,     calm    and   cordial.     Having

supportably     determined      that   Palmquist’s     statements      were   not

immunized under Garrity, the district court properly denied the

motion to suppress.

                                       III.

     Palmquist’s challenge to the court’s restitutionary order turns

on his alleged entitlement to an offset for benefits he never

received from the Veterans Administration.             From March 2006 until

their divorce in October 2007, Palmquist was married to Tammy Swank.

As a consequence, he could have claimed her as a dependent. If such

a claim had been made and awarded, the                $9,789.00 in improper

                                       -12-
benefits received for his previous wife Williams-Enstrom and her

child, and awarded as restitution to the Veterans Administration,

would theoretically have been reduced by $1,791.00.   But he made no

timely administrative claim for the Swank benefits and chose only

to assert entitlement during the sentencing proceedings.

     His challenge involves a shameless sleight of hand.      First,

Palmquist asks that his failure to apply for the benefit in a timely

fashion and the bar consequence under Veterans Administration

regulations be ignored.   But procedural rules are applicable to all

claimants.   Palmquist needed to submit updated evidence of his

marital status within one year of his marriage to Swank in order for

his increased benefits to run from that dependency status event.

See 38 C.F.R. § 3.660(c); see also id. §§ 3.401, 3.213.5   Palmquist

in his reply brief “concedes that he did not fill out all the

paperwork for [the Swank] benefits”6 and thus failed to meet these

procedural requirements. Like any other claimant who failed to make

     5
       It appears that the testimony during the sentencing hearing
that Palmquist had two years from the dependency event to apply for
benefits was inaccurate. Moreover, it appears there is only a time
limit on making benefits retroactive to the dependency event; there
is no time limit on applying for prospective benefits.        These
refinements are of no assistance to Palmquist, because he did not
apply for benefits at any point during his marriage to Swank.
     6
        He contends, however, that he gave the Veterans
Administration notice of his marriage to Ms. Swank when he filed
for medical benefits for her.    But that notice, apart from not
claiming dependency benefits, was provided to a different Veterans
Administration division, which someone like Palmquist, with a
sophisticated understanding of Veterans Administration procedures,
would know to be unlikely to make the connection to a claim for
dependency benefits.

                                -13-
a timely claim, Palmquist thus had no entitlement to any Swank

benefit.

     Second, Palmquist seeks to avoid his procedural obligations by

invoking Comment 3(F)(ii) to USSG § 2B1.1, the sentencing guideline

governing the loss incurred by the Veterans Administration and the

restitution required to make the Veterans Administration whole. The

Comment provides:

     Government Benefits. - In a case involving government
     benefits (e.g., grants, loans, entitlement program
     payments), loss shall be considered to be not less than
     the value of benefits obtained by unintended recipients
     or diverted to unintended uses, as the case may be. For
     example, if the defendant was the intended recipient of
     food stamps having a value of $100 but fraudulently
     received food stamps having a value of $150, loss is $50.

But the underlying, if not explicitly stated, assumption in the

comment    is   that   an   “intended    recipient”   is   one   who   has   an

entitlement to $100 in food stamps.          Having failed timely to make

a claim, Palmquist, like any other untimely claimant, lost any legal

entitlement he might have had.7         The reason for his failure to make

the Swank claim is obvious: it would have disclosed that he no

longer had any entitlement to the more valuable Williams-Enstrom

benefit, and hadn’t for some time, since he was divorced from

     7
       Such an independent procedural bar to mitigating benefit
amounts distinguishes this case from those, cited to us by
Palmquist, in which courts measured loss as the difference between
the amount of benefits actually received and the amount defendant
would have received absent untruthful reporting in the benefits
claim itself. See United States v. Tupone, 442 F.3d 145, 153-54
(3d Cir. 2006); United States v. Dawkins, 202 F.3d 711, 714 (4th
Cir. 2000).

                                    -14-
Williams-Enstrom in 2003. His scheme depended on concealment of the

fact that he was no longer entitled to Williams-Enstrom benefits,

a disclosure that would necessarily follow from a claim for Swank

benefits.

     There is no reason why Palmquist should get some special

indulgence,    unavailable      to    other    dilatory    benefit    claimants,

providing     him   with   a    means    to    minimize    his   restitutionary

obligations for criminal fraud.            His claim for an offset is the

financial   equivalent     of   the     plea   of   the   parricide   who   seeks

consideration from the court by pointing out that he is an orphan,

seeking to avoid confronting the unhappy fact that this is a

condition of his own contrivance.

     Affirmed.

                                        -15-