Court Opinion

ID: 65982
Source: CourtListenerOpinion
Date Created: 2010-04-26 06:05:19+00
Date Added: 2024-06-11T17:20:44.016165
License: Public Domain

[DO NOT PUBLISH]

              IN THE UNITED STATES COURT OF APPEALS

                      FOR THE ELEVENTH CIRCUIT
                        ________________________                  FILED
                                                         U.S. COURT OF APPEALS
                                                           ELEVENTH CIRCUIT
                               No. 08-10786
                                                           SEPTEMBER 10, 2008
                           Non-Argument Calendar
                                                            THOMAS K. KAHN
                         ________________________                CLERK

                    D. C. Docket No. 04-14003-TP-DMM

UNITED STATES OF AMERICA,

                                                       Plaintiff-Appellee,

                                    versus

RANDY SCOTT SYROP,

                                                       Defendant-Appellant.

                         ________________________

                 Appeal from the United States District Court
                     for the Southern District of Florida
                       _________________________

                            (September 10, 2008)

Before TJOFLAT, DUBINA and BLACK, Circuit Judges.

PER CURIAM:

     Appellant Randy Scott Syrop (“Syrop”) appeals the revocation of his
probation and the sentence imposed by the district court. We affirm.

                                 I. BACKGROUND

      In 2002, Syrop pleaded guilty to mail and wire fraud arising from a “pump

and dump” scheme in which he willfully filed false documents with the Securities

and Exchange Commission and disseminated false press releases in order to bolster

a chosen stock’s value. The scheme resulted in investor losses totaling almost

seven million dollars. Nonetheless, because of his substantial cooperation with the

Government, the district court sentenced Syrop only to five years’ probation. Two

conditions placed on Syrop were that he not “engag[e] in any employment related

directly or indirectly to investments or securities business opportunities,” DE 1 at

11, and that he “answer truthfully all inquiries by the probation officer,” id. at 10.

In November 2007, Syrop’s probation officer, Ron Manganiello, filed a notice with

the district court that Syrop had violated these conditions.

      Syrop’s primary employment during his probation was with Broadvision

Group, an internet advertising company owned by John Grandinetti. Syrop

consistently maintained that his only function was web marketing—specifically,

selling banner advertisements. Manganiello received notice from several people

that Syrop engaged in other sales activities. First, Brett Friedman sent a letter

stating that he “met with Randy Syrop on approximately 5 occasions regarding

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investing in Tube Media corporation.” DE 16 at 2 (exh. 1). At one meeting,

according to Friedman, Syrop and Grandinetti presented a sales pitch for the stock,

“enticing [Friedman and two others] to buy stock in the company.” Id. Friedman

lost $160,000. Id. Second, Daniel Drapacz wrote that Syrop called him offering

an investment opportunity in “Pyramid Records/TUBE Media Corporation.” Id. at

3 (exh. 2). Syrop offered $50,000 in public shares, and $48,000 in restricted shares

held in Syrop’s mother’s name. Id. Drapacz purchased the stock—the public

shares over the Internet, and the private shares from Syrop’s mother. Id.

According to Drapacz, Syrop also solicited the 2004 sale of one-third of

Broadvision to Drapacz and his cousin, Harry Bruner, for $650,000. Id.; see also

id. at 12-18 (sales contract between Grandinetti and Bruner). When Bruner

became dissatisfied with Broadvision’s performance and threatened to contact the

authorities, Syrop threatened him. Id. at 3 (exh. 2).

      Based on these allegations, Manganiello filed a notice with the district court

that Syrop had violated his probation conditions by engaging in employment

related to investments and securities, and by lying to Manganiello by not telling

him about those activities. A magistrate judge held a Federal Rule of Criminal

Procedure 32.1(b)(1)(a) preliminary hearing in which Manganiello testified about

the Friedman and Drapacz statements. See generally DE 23 (Transcript of Pretrial

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Detention & Preliminary Hearing). Syrop presented rebuttal evidence, including a

sales contract between Bruner and Grandinetti, and a civil complaint by Bruner

against Grandinetti, which showed that Grandinetti, not Syrop, was responsible for

the Broadvision sale. DE 16 at 12-18 (contract between Grandinetti and Bruner;

Syrop not mentioned); id. at 5-11 (civil complaint by Bruner against Grandinetti;

Syrop not mentioned).

      The magistrate judge noted “inconsistencies” in the evidence—specifically,

that the contract and civil complaint contradicted Drapacz’s allegation that Syrop

was involved in the Broadvision sale—but found “sufficient probable cause” to

conclude that Syrop violated his probation conditions by engaging in investment-

related employment and lying to his probation officer about that activity. DE 18 at

6. The magistrate judge referred the case to the district court for an evidentiary

hearing with live witnesses to resolve the inconsistency and adopt or reject the

recommendation. Id.

      The district court held an evidentiary hearing in which similar evidence was

presented, with the exception that Drapacz and Friedman testified live, rather than

having their statements read. See generally DE 47 (Transcript of Probation

Violation Proceedings). Friedman testified that Syrop invited him to a shareholder

meeting for Tube Media Corporation. Id. at 10. He understood Syrop to be a

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“consultant for the company.” Id. at 19. After sitting through the meeting, Syrop

took Friedman and another potential investor to a conference room, where Syrop

presented a sales pitch for investment in The Tube. Id. at 10. Friedman testified

that he then decided to invest in The Tube by purchasing public shares on the

internet, and private shares from others through Syrop. Id. at 11, 24. The Tube

failed, and Friedman lost over $160,000. Id. at 10. On cross examination,

Friedman testified about the reasons for his continued investment in The Tube: Les

Garland, a principal in major television networks MTV and VH1, was involved;

The Tube had a television channel in millions of homes; and Friedman had made

substantial gains on an earlier smaller investment in The Tube. Id. at 20-21.

Nevertheless, despite deciding that The Tube was a legitimate business based on

his own due diligence, Friedman felt in retrospect that it was a “pump and dump”

scheme, and Syrop sought him out to convince him to invest in the company. Id. at

21, 23.

      Drapacz also expounded his statement during live testimony. He testified

that Syrop was fully involved in the sale of Broadvision, and that Syrop was

Grandinetti’s partner in Broadvision but could not own anything “on paper”

because he was on probation. Id. at 34. Syrop’s attorney sought to discredit

Drapacz on cross-examination by noting that Drapacz is a convicted felon and that

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the Broadvision contract and subsequent civil suit belied his accusation that Syrop

sold Broadvision. Id. at 43-44, 48-49.

      Syrop presented his own witnesses, including The Tube’s and Broadvision’s

lawyer, who testified that he had no indication that Syrop held any kind of

ownership interest in Broadvision, and Syrop did not have a consulting agreement

with The Tube. Id. at 77-78.

      After hearing the testimony and argument, the district court found that Syrop

had violated his probation conditions. Id. at 99-100. The district court credited

both Friedman and Drapacz, noting that both testified to Syrop promoting

investment in The Tube while holding himself out as a consultant. Id. at 100. The

district court found it irrelevant that the offerings were not a part of his formal

employment with Broadvision; “The idea was that he shouldn’t be involved in

offering securities to people because of his prior involvement in a pump and dump

scheme.” Id. at 101. Syrop insisted that he “was just being polite in talking to

people about [The Tube],” and “at no time did [he] care if anybody bought the

stock or not.” Id. at 102. Nonetheless, the district court found that Syrop engaged

in securities-related employment and lied to his probation officer about it. The

court calculated the Guidelines range as three to nine months’ imprisonment, but

sentenced Syrop to 24 months’ imprisonment because the probation violation

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repeated the original criminal acts. Id. at 105.

                          II. STANDARDS OF REVIEW

      “[T]his court generally reviews a district court’s revocation of probation for

an abuse of discretion.” United States v. Mitsven, 452 F.3d 1264, 1265 (11th Cir.

2006). In reviewing a revocation proceeding, “[a] district court’s findings of fact

are binding on this court unless clearly erroneous.” United States v. Almand, 992

F.2d 316, 318 (11th Cir. 1993) (quoting United States v. Granderson, 969 F.2d

980, 982 (11th Cir.1992)).

      We review the reasonableness of a sentence for an abuse of discretion. Gall

v. United States, 128 S. Ct. 586, 597 (2007).

                                   III. ANALYSIS

      The thrust of Syrop’s argument is that the condition against “engaging in

employment related to securities and investments” did not extend to Syrop’s giving

advice about investments to people or investing in securities himself.

According to Syrop, the Government must present direct evidence that he gained a

benefit from a transaction for that transaction to constitute “engaging in

employment related to securities and investments.” Furthermore, Syrop argues that

because the advice he gave Friedman and the small role he played in the

Broadvision sale to Bruner were not “employment,” it was not a lie to tell his

                                           7
probation officer his only employment was selling banner advertisements.

       We reject Syrop’s arguments.1 “In a probation revocation proceeding, all

that is required is that the evidence reasonably satisfy the judge that the conduct of

the probationer has not been as good as required by the conditions of probation;

evidence that would establish guilt beyond a reasonable doubt is not required.”

United States v. O’Quinn, 689 F.2d 1359, 1361 (11th Cir. 1982) (quoting United

States v. Rice, 671 F.2d 455, 458 (11th Cir. 1982)). We hold that the district court

could easily conclude from the evidence presented that Syrop engaged in

employment related to securities and investments at least twice. First, the district

court could reasonably conclude from Drapacz’s testimony that Syrop was a

shadow partner in Broadvision, directly involved in the sale that, on paper, was

between Grandinetti and Bruner only. Second, the district court could reasonably

infer that Syrop stood to gain from Friedman’s investment in The Tube, given that

Syrop held himself out as a consultant and actively promoted the stock. Moreover,

because the district court could conclude that Syrop was engaged in activities

beyond banner-advertising sales, the court could also reasonably conclude that

Syrop lied to his probation officer when he stated that his only employment was

       1
          Syrop also argues that it was error for the Government to fail to call Bruner to the stand
because the magistrate judge’s report and recommendation stated that “Friedman, Drapacz and
Bruner . . . need to be personally present at any final evidentiary hearing.” DE 18 at 6. We
reject this argument; if Syrop wanted Bruner to testify, he could have called Bruner to the stand.

                                                  8
selling banner advertisements.

      We also conclude that the two-year sentence was reasonable. To review a

sentence, an appellate court “must first ensure that the district court committed no

significant procedural error,” and “then consider the substantive reasonableness of

the sentence imposed under an abuse-of-discretion standard.” Gall, 128 S. Ct. at

597. Syrop first argues that the district court’s sentence was procedurally unsound

because it found that Syrop’s first conviction was for a pump-and-dump scheme,

when the conviction was only for causing false filings to be mailed. The relevant

conduct for sentencing purposes extends far beyond the specific crime of which the

defendant was convicted. See U.S.S.G. § 1B1.2 (“Relevant Conduct”). The

district court concluded from the Presentence Investigation Report that Syrop’s

relevant conduct included a pump-and-dump scheme; that finding was not clearly

erroneous. Moreover, we conclude that it was reasonable for the district court to

exceed the nine-month upper bound recommended by the Guidelines. Recidivist

conduct touches multiple 18 U.S.C. § 3553(a) sentencing factors: it affects“the

nature and circumstances of the offense and the history and characteristics of the

defendant”; it suggests a greater “seriousness of the offense”; and it shows a

greater need “to promote respect for the law,” “deter[] criminal conduct,” and “to

protect the public from further crimes of the defendant.” Therefore, a 24-month

                                          9
sentence was reasonable given the recidivist nature of Syrop’s probation violation.

                               IV. CONCLUSION

      The district court did not abuse its discretion when it revoked Syrop’s

probation, and the 24-month sentence was reasonable.

      AFFIRMED .

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