Court Opinion

ID: 1018877
Source: CourtListenerOpinion
Date Created: 2013-07-04 22:27:05.061454+00
Date Added: 2024-06-11T15:47:29.816746
License: Public Domain

UNPUBLISHED

                    UNITED STATES COURT OF APPEALS
                        FOR THE FOURTH CIRCUIT

                             No. 05-4636

UNITED STATES OF AMERICA,

                                              Plaintiff - Appellee,

           versus

BERNARD H. LINNEY,

                                              Defendant - Appellant.

Appeal from the United States District Court for the Southern
District of West Virginia, at Parkersburg. Robert C. Chambers,
District Judge. (CR-04-220)

Argued:   March 17, 2006                   Decided:   March 28, 2006

Before WILKINSON, MICHAEL, and MOTZ, Circuit Judges.

Affirmed by unpublished per curiam opinion.

ARGUED: Leah Perry Macia, BAILEY & GLASSER, L.L.P., Charleston,
West Virginia, for Appellant. Robert Booth Goodwin, II, Assistant
United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY,
Charleston, West Virginia, for Appellee. ON BRIEF: Benjamin L.
Bailey, BAILEY & GLASSER, L.L.P., Charleston, West Virginia, for
Appellant.   Charles T. Miller, Acting United States Attorney,
Charleston, West Virginia, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:

     Bernard H. Linney pleaded guilty to one count of failure to

account for and pay over federal income tax in violation of 26

U.S.C. § 7202 (2000).   Linney appeals his sentence, arguing that

the district court improperly imposed a four level enhancement

based on his leadership role in the offense.   We affirm.

     Linney served as president and CEO of Progressive Financial

Group (PFG), a holding and management company that ultimately

controlled seven small businesses.    In July, 1997, Linney began

instructing employees at PFG’s small businesses not to pay taxes.

In 1998, Linney set up a check-kiting scheme that operated among

PFG’s various businesses and accumulated millions of dollars in

debt from bad checks.   Linney continued instructing employees not

to pay taxes owed, telling them that he was negotiating with the

IRS and that he had secured a loan to pay off the taxes.     Five of

the businesses operating under PFG’s umbrella ultimately owed over

$500,000 in unpaid taxes.

     At sentencing, the district court found that Linney qualified

for a four level enhancement because of his leadership role in a

criminal scheme that was “otherwise extensive.”   See United States

Sentencing Commission Guidelines Manual § 3B1.1(a).         Linney’s

advisory guidelines range was 27-33 months; the court found that “a

sentence at the top of the guideline range is appropriate” and

sentenced Linney to 33 months.

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     Linney asserts that it was improper for the district court to

consider the check kiting scheme when determining whether the

scheme at issue was extensive for purposes of the guidelines.                We

review a district court’s legal interpretations of the sentencing

guidelines de novo and a district court’s factual findings for

clear error.       See United States v. Green, 436 F.3d 449, 456 (4th

Cir. 2006).    Section 3B1.1 of the Guidelines Manual indicates that

a four level enhancement is appropriate “[i]f the defendant was an

organizer or leader of a criminal activity that involved five or

more participants or was otherwise extensive.”              The introductory

commentary to this section of the manual directs the district court

to consider all relevant conduct as defined by § 1B1.3.                See also

United States v. Fells, 920 F.2d 1179, 1183-84 (4th Cir. 1990)

(holding    that    a   district   court     should   consider   all   relevant

conduct).     In addition, § 3B1.1 instructs the sentencing court to

consider “all persons involved during the course of the entire

offense,”     regardless      of   whether    those    persons   are   knowing

participants       in   the   scheme.       See   United   States   Sentencing

Commission Guidelines Manual [hereinafter USSG] § 3B1.1 n.3.

     Linney argues that the check kiting scheme was not relevant

conduct under § 1B1.3 because the check kite did not facilitate the

tax evasion.       However, even assuming that the check kite was not

relevant conduct under § 1B1.3, there is sufficient evidence in the

record to support a finding that the tax evasion scheme alone was

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“otherwise extensive.”        Linney instructed at least four employees

to refrain from paying taxes owed. The district court specifically

noted “the number of people involved” and that             although “perhaps

not all of them were criminally responsible . . . Application Note

Number 3 [to USSG § 3B1.1] indicates that a factor in considering

whether [a criminal activity is] otherwise extensive is the extent

to which other people are used even if they’re not criminally

responsible for the conduct.” In addition, Linney does not dispute

the fact that five distinct corporate entities -- all operating

under the umbrella of PFG -- participated in the tax evasion

scheme.

      These facts are sufficient to support a finding that the tax

evasion scheme alone was extensive; thus, the district court did

not   err   in   imposing     a    four   level   enhancement      for    Linney’s

leadership   role   in   an       extensive   criminal   scheme.         Given   the

extensive nature of the tax evasion scheme, we need not decide

whether the check kiting scheme was relevant conduct according to

§ 1B1.3.

      For the foregoing reasons, the judgment of the district court

is

                                                                         AFFIRMED.

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