Court Opinion

ID: 159135
Source: CourtListenerOpinion
Date Created: 2010-08-14 06:18:33+00
Date Added: 2024-06-11T12:39:05.504292
License: Public Domain

F I L E D
                                                                      United States Court of Appeals
                                                                              Tenth Circuit
                     UNITED STATES COURT OF APPEALS
                                                                              JAN 31 2000
                                TENTH CIRCUIT
                           __________________________                    PATRICK FISHER
                                                                                  Clerk

 UNITED STATES OF AMERICA,

          Plaintiff-Appellee,

 v.                                                        No. 99-5162
                                                           (N.D. Okla.)
 BARRY W. CONE,                                     (D.Ct. No. 98-CR-178-H)

          Defendant-Appellant.
                        ____________________________

                                ORDER AND JUDGMENT *

Before BRORBY, EBEL, and LUCERO, Circuit Judges.

      After examining the briefs and appellate record, this panel has determined

unanimously that oral argument would not materially assist the determination of

this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is

therefore ordered submitted without oral argument.

      Appellant Barry W. Cone appeals his sentence after pleading guilty to one

      *
          This order and judgment is not binding precedent except under the doctrines of
law of the case, res judicata and collateral estoppel. The court generally disfavors the
citation of orders and judgments; nevertheless, an order and judgment may be cited under
the terms and conditions of 10th Cir. R. 36.3.
count of bank fraud under 18 U.S.C. § 1344. On appeal, Mr. Cone argues the

district court improperly increased his sentence under United States Sentencing

Guideline § 3C1.1 for obstruction of justice and denied his request for a sentence

reduction under U.S.S.G. § 3E1.1 for acceptance of responsibility. We exercise

jurisdiction under 28 U.S.C. § 1291 and affirm.

      The criminal activity for which Mr. Cone received a six-count indictment

involved his conduct in giving several banks false information in order to secure

loans. The banks did not adequately verify this information and extended loans to

Mr. Cone in an amount totaling over one million dollars during an eight-month

period. Following an investigation, authorities subsequently issued an indictment

against Mr. Cone. Pursuant to a plea agreement, Mr. Cone pled guilty to one

count of the indictment for bank fraud under 18 U.S.C. 1344(1).

      In an interview with the probation officer, Mr. Cone admitted his criminal

conduct and provided a statement consistent with the facts of the case. He later

also provided information on payments he made on the loans for the purpose of

determining the correct amount owed in restitution. Among the information and

documents provided, Mr. Cone gave the probation officer two checks drawn on

his account at Islanders Bank. On the first check, made payable to Islanders Bank

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in the amount of $7,274.62, Mr. Cone wrote “Payment 219040961,” which is the

loan number for the loan Mr. Cone received from that bank. However, the

probation officer determined, as verified by Mr. Cone’s counsel at the sentencing

hearing, that Mr. Cone made the notation prior to giving the check to the

probation officer and did not use the check to make a payment on the loan, but

rather to purchase a $7,200 cashier’s check made payable to a third party. The

probation officer found Mr. Cone made the notation in an attempt to reduce the

amount of restitution payable to his victims.

      Mr. Cone gave the second check, made payable to Skagit Bank in the

amount of $500, to the probation officer with the representation he used it to

make a payment on a loan with that bank. However, Mr. Cone actually deposited

the check into his account at that bank and received $300 in cash back from the

deposit, instead of making a payment on his loan. In fact, Mr. Cone himself

never made a payment on either of the two loans in question.

      Based on these facts, the probation officer found Mr. Cone’s conduct

constituted an attempt to obstruct the presentence investigation by providing

materially false information, thereby qualifying him for a two-level increase in his

sentence for obstruction of justice and making him ineligible for a reduction for

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acceptance of responsibility. Mr. Cone objected to the presentence report, noting

the two checks he inadvertently misrepresented constituted only a part of his

ongoing effort to assist the probation office, and he submitted them knowing the

probation office would independently verify them. He also argued submission of

the two checks did not affect his acknowledgment of wrongdoing, because he

submitted them only in an attempt to determine what amount he owed in

restitution to his victims.

      The district court found Mr. Cone qualified for an obstruction of justice

increase in his sentence under U.S.S.G. § 3C1.1. In so finding, the district court

rejected Mr. Cone’s objections to the presentence report as well as his sentencing

hearing argument that no evidence showed a willful or knowing attempt to

mislead the probation officer. Specifically, the district court rejected Mr. Cone’s

hearing argument that he did not willfully attempt to mislead because (1) most of

the information he provided correctly showed a reduction of the restitution

amount; (2) he knew the probation officer would investigate and verify the

amount; (3) he would not intentionally risk increasing his sentencing for a mere

$7,000 deduction in restitution; and (4) he could not recall the circumstances of

his loan repayments given the amount and number of loans he received. In

rejecting these contentions, the district court also found Mr. Cone ineligible for a

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§ 3E1.1 reduction in his sentence for acceptance of responsibility. The district

court noted only rare circumstances permit eligibility for such a reduction when

obstruction of justice occurs. The district court found no rare circumstance

existed and that Mr. Cone’s conduct in falsely representing the checks, for the

purpose of reducing his restitution amount, was consistent with his conduct in

providing the banks with false information to obtain the loans. The district court

sentenced Mr. Cone to twenty-two months in prison. 1

      On appeal, Mr. Cone renews the same arguments presented to and

addressed by the district court. Most specifically, he renews his contention no

evidence of willfulness existed to support the sentence increase for obstruction of

justice. He also claims he is eligible for a reduction in his sentence for

acceptance of responsibility, regardless of whether he obstructed justice, because

this is an “extraordinary case” and his conduct in presenting the checks was not

inconsistent with his acceptance of responsibility.

                               A. Obstruction of Justice

      We review the district court’s factual determinations on obstruction of

      1
         As Mr. Cone requested, the district court sentenced him to the low end of the
sentencing range of twenty-one to twenty-seven months in prison.

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justice for clear error, giving due deference to the district court’s application of

the sentencing guidelines to the facts. United States v. Hankins, 127 F.3d 932,

934 (10th Cir. 1997). We review de novo the district court’s legal interpretation

of the sentencing guidelines. Id. United States Sentencing Guideline § 3C1.1

mandates a two-level offense increase if Mr. Cone “willfully obstructed or

impeded, or attempted to obstruct or impede, the administration of justice during

the course of the investigation, prosecution, or sentencing” of his offense. This

includes “providing materially false information to a probation officer in respect

to a presentence or other investigation for the court.” U.S.S.G. § 3C1.1,

comment. (n.4(h)).

      After reviewing the record and these standards, we hold the district court’s

finding Mr. Cone misrepresented the purpose of the checks at issue was not

clearly erroneous. Mr. Cone’s contention he unintentionally misrepresented the

checks as loan payments because he could not recall the circumstances of all his

loan repayments, seems incredible given he never made payments on the loans

involved. Moreover, the fact he made a notation of the loan number on the

$7,274.62 check, just prior to presenting it to the probation officer as a loan

payment, shows a wilful intent to misrepresent the purpose of the check. If Mr.

Cone had been unsure of the check’s purpose, or confused over the circumstances

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of his loan payments as alleged, it seems more likely he would have indicated this

to his attorney and the probation officer when he presented them the check, rather

than marking the loan number on it without explanation. Thus, we have little

difficulty concluding Mr. Cone, in trying to decrease the amount of restitution

owed, misrepresented the purpose of the checks during the course of the probation

officer’s investigation. Because Mr. Cone made a material misrepresentation, we

find it irrelevant whether other information Mr. Cone provided legitimately

assisted the probation officer or whether Mr. Cone thought the probation officer

might verify the payments. For these reasons, we conclude the district court did

not err in increasing Mr. Cone’s sentence under § 3C1.1 for obstruction of justice.

                          B. Acceptance of Responsibility

      The district court has broad discretion to determine whether to award Mr.

Cone a sentence reduction under U.S.S.G. § 3E1.1 for acceptance of

responsibility, and we will not disturb its decision absent clearly erroneous

findings. United States v. Bindley, 157 F.3d 1235, 1240 (10th Cir. 1998), cert.

denied, 119 S. Ct. 1086 (1999); see also U.S.S.G. § 3E1.1, comment. (n.5). We

may overturn the district court’s acceptance of responsibility determination only

if it is without foundation. United States v. Amos, 984 F.2d 1067, 1071-72 (10th

Cir. 1993). Mr. Cone “bears the burden of establishing entitlement to a reduction

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under § 3E1.1.” Bindley, 157 F.3d at 1241. To receive a reduction, Mr. Cone

“must show recognition and affirmative acceptance of personal responsibility for

his criminal conduct.” Id. (quotation marks and citation omitted). “[A] defendant

who falsely denies, or frivolously contests, relevant conduct that the court

determines to be true has acted in a manner inconsistent with acceptance of

responsibility.” U.S.S.G. § 3E1.1, comment. (n.1(a)). Except in “extraordinary

cases,” conduct resulting in a sentence enhancement for obstruction of justice

ordinarily indicates the defendant has not accepted responsibility for his criminal

conduct. See U.S.S.G. § 3E1.1, comment. (n.4).

      Given Mr. Cone’s intentional misrepresentation of the checks at issue, and

his repeated refusal to admit to his intentional misrepresentation, we can hardly

conclude this is an “extraordinary case” warranting a downward adjustment for

acceptance of responsibility for his criminal conduct. Moreover, we find Mr.

Cone’s obstructive conduct, in attempting to reduce the restitution he owes the

“victim banks,” is inconsistent with his acceptance of responsibility for

defrauding those same banks. Thus, sufficient foundation exists for the district

court’s decision not to apply a sentence reduction for acceptance of responsibility

under U.S.S.G. § 3E1.1.

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For these reasons, we AFFIRM the sentence imposed by the district court.

                              Entered by the Court:

                              WADE BRORBY
                              United States Circuit Judge

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