Court Opinion

ID: 2979523
Source: CourtListenerOpinion
Date Created: 2015-09-22 18:52:44.847472+00
Date Added: 2024-06-11T11:44:17.720842
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                            Pursuant to Sixth Circuit Rule 206
                                    File Name: 11a0042p.06

                UNITED STATES COURT OF APPEALS
                                FOR THE SIXTH CIRCUIT
                                  _________________

                                                 X
          Plaintiff-Appellee/Cross-Appellant, -
 UNITED STATES OF AMERICA,
                                                  -
                                                  -
                                                  -
                                                      Nos. 07-1695/1696/1850/1851
           v.
                                                  ,
                                                   >
 DONNY G. DOUGLAS (07-1695/1850) and JAY -
                                                  -
      Defendants-Appellants/Cross-Appellees. -
 D. CAMPBELL (07-1696/1851),
                                                  -
                                                 N
                    Appeal from the United States District Court
                  for the Eastern District of Michigan at Detroit.
               No. 02-80863—Nancy G. Edmunds, District Judge.
                                 Argued: January 20, 2011
                         Decided and Filed: February 10, 2011
    Before: MARTIN and MOORE, Circuit Judges; BUNNING, District Judge.*

                                    _________________

                                         COUNSEL
ARGUED: N. C. Deday LaRene, LaRENE & KRIGER, P.L.C., Detroit, Michigan,
Harold Gurewitz, GUREWITZ & RABEN, PLC, Detroit, Michigan, for Appellants.
Kathleen Moro Nesi, ASSISTANT UNITED STATES ATTORNEY, Detroit, Michigan,
for Appellee. ON BRIEF: N. C. Deday LaRene, LaRENE & KRIGER, P.L.C., Detroit,
Michigan, Harold Gurewitz, GUREWITZ & RABEN, PLC, Detroit, Michigan, for
Appellants. Kathleen Moro Nesi, ASSISTANT UNITED STATES ATTORNEY,
Detroit, Michigan, for Appellee.

        *
        The Honorable David L. Bunning, United States District Judge for the Eastern District of
Kentucky, sitting by designation.

                                               1
Nos. 07-1695/1696/1850/1851           United States v. Douglas, et al.             Page 2

                                 _________________

                                       OPINION
                                 _________________

       BOYCE F. MARTIN, JR., Circuit Judge.               Defendants-Appellants-Cross-
Appellees Donny Douglas and Jay Campbell appeal their convictions under the Labor
Management Relations Act and the Hobbs Act. The United States cross-appeals their
sentences. This case is now in its eighth year of litigation. Some of the underlying
events transpired over seventeen years ago. Our court, and this same panel, heard a first
appeal in this case more than six years ago. United States v. Douglas, 398 F.3d 407 (6th
Cir. 2005). For the following reasons, we AFFIRM Douglas’s and Campbell’s
convictions, and although we would prefer to end these lengthy proceedings and give
closure to the parties, we must REMAND for resentencing.

                                 I. BACKGROUND

       Donny Douglas and Jay Campbell worked as representatives of the United Auto
Workers at the General Motors factory in Pontiac, Michigan. While negotiating with
General Motors in the 1990s, they pressured General Motors several times to give highly
skilled, “journeyman” jobs to two non-qualified relatives of Union members. These jobs
paid as much as $150,000 per year, which was approximately double the salary of a
production line worker. General Motors refused to comply each time. Acquiescing
would have violated the hiring priorities set forth in the national and local agreements
between the Union and General Motors. The pressure came to a head when the Union
was on strike in 1997, costing General Motors millions of dollars each day. On the
eighty-seventh day of the strike, Union leaders met with representatives from General
Motors to attempt to resolve all their issues and end the strike within twenty-four hours.
The parties successfully resolved every official issue and grievance between them within
twenty-four hours, but Douglas informed James Rhadigan, a General Motors official,
that the strike would not end unless the two unqualified relatives of Union members
finally received journeyman jobs. Rhadigan relented, the non-qualified relatives
received the journeyman jobs, and the strike ended. As a result, multiple qualified
Nos. 07-1695/1696/1850/1851           United States v. Douglas, et al.             Page 3

journeyman applicants filed grievances with General Motors for not adhering to the
hiring priorities laid out in the national and local agreements. Two qualified applicants
were eventually hired on top of the two non-qualified Union member relatives.

         The United States prosecuted Douglas and Campbell for violations of the Labor
Management Relations Act and the Hobbs Act, claiming that they conspired to demand
“things of value” and wrongfully used their labor positions to force General Motors to
give jobs to two relatives of Union members. The district court dismissed the indictment
as insufficient, but this Court reversed when this same panel found that the indictment
sufficiently alleged the charges. Subsequently, Douglas and Campbell proceeded to trial
and were convicted. They now appeal, arguing that their convictions are not supported
by sufficient evidence. The United States cross-appeals their sentences.

                                   II. DISCUSSION

         Douglas and Campbell appeal their convictions on several grounds: (1) their
actions do not constitute a violation of the Labor Management Relations Act, and the
district court’s jury instruction regarding the Act was an incorrect statement of the law;
(2) violating a labor agreement is not a criminally “wrongful” use of a labor position
under the Hobbs Act; and (3) the United States’s Brady violation at trial warrants a new
trial.   Additionally, Campbell argues that the district court’s jury instruction
constructively amended his indictment to include activity not covered by the Labor
Management Relations Act.

         The United States cross-appeals both sentences, claiming that the district court
erred by: (1) using the Blackmail Sentencing Guideline, U.S.S.G. § 2B3.3, rather than
the Extortion Sentencing Guideline, U.S.S.G. § 2B3.2; (2) failing to enhance Douglas’s
and Campbell’s total offense level by calculating the loss to General Motors as zero; and
(3) varying Douglas’s sentence downward to match a departure that Campbell received
due to his lung cancer.
Nos. 07-1695/1696/1850/1851           United States v. Douglas, et al.               Page 4

A.      The Labor Management Relations Act

        The Labor Management Relations Act prohibits “any employer . . . to pay, lend,
or deliver . . . any money or other thing of value to any representative of any of his
employees who are employed in an industry affecting commerce.”                  29 U.S.C.
§ 186(a)(1). It further forbids anyone to “request, demand, receive, or accept . . . any
payment, loan, or delivery of any money or other thing of value prohibited by subsection
(a) of this section.” Id. § 186(b)(1). Douglas and Campbell argue that their actions do
not fall within the scope of the Act because: (1) they did not demand a “thing of value”
for purposes of the Act; and (2) they did not personally receive any “thing of value.” We
review both questions of statutory interpretation de novo. United States v. Gagnon, 553
F.3d 1021, 1025 (6th Cir. 2009). Douglas and Campbell also claim that the district court
incorrectly instructed the jury as to section 186(b)(1). We review de novo this claim as
well. H.C. Smith Invs., L.L.C. v. Outboard Marine Co., 377 F.3d 645, 650 (6th Cir.
2004) (citing Fisher v. Ford Motor Co., 224 F.3d 570, 576 (6th Cir. 2000)). Lastly, we
review constructive amendment claims de novo also. United States v. Budd, 496 F.3d
517, 528 (6th Cir. 2007).

        1.      Thing of Value

        Douglas and Campbell protest that the word “other” in the phrase “money or
other thing of value” constrains “thing of value” to things of monetary value. They also
invoke ejusdem generis, a principle of statutory interpretation providing that, “where
general words follow specific words in a statutory enumeration, the general words are
construed to embrace only objects similar in nature to those objects enumerated by the
preceding specific words.” Wash. State Dept. of Soc. & Health Servs. v. Guardianship
Estate of Keffeler, 537 U.S. 371, 384-85 (2003). But that rule applies to “list[s] of
specific items separated by commas and followed by a general or collective term,” not
to a “phrase [that] is disjunctive, with one specific and one general category.” Ali v. Fed.
Bureau of Prisons, 552 U.S. 214, 225 (2008) (refusing to apply the canon to the phrase
“any officer of customs or excise or any other law enforcement officer”). The
interpretive canon noscitur a sociis (“a word is known by the company it keeps”) is also
Nos. 07-1695/1696/1850/1851            United States v. Douglas, et al.               Page 5

inapplicable when the statute provides few other analogous terms.               Id. at 226.
Additionally, “[t]he rule [of lenity] does not apply when a statute is unambiguous or
when invoked to engraft an illogical requirement to its text.” Salinas v. United States,
522 U.S. 52, 66 (1997). And the name of the section, “[r]estrictions on financial
transactions,” should not trump the plain meaning of the statutory text.

        “[A] fundamental canon of statutory construction is that ‘when interpreting
statutes, the language of the statute is the starting point for interpretation, and it should
also be the ending point if the plain meaning of that language is clear.’” Thompson v.
Greenwood, 507 F.3d 416, 419 (6th Cir. 2007) (quoting United States v. Boucha, 236
F.3d 768, 774 (6th Cir. 2001)). Douglas’s and Campbell’s position is contrary to the
plain language of the statute. The statute’s scope is not limited to only monetary items.
Truly, of all the things in this world widely regarded as valuable, money and the like
comprise only a small percentage. In the midst of the world’s current financial struggles,
when the unemployment rate in this country fluctuates between nine and ten percent, it
is somewhat laughable to argue that Douglas and Campbell did not demand a “thing of
value” when they demanded high-paying jobs for their cronies. The value of a job,
especially one that pays $150,000 per year, is undeniable. In this case, the jobs
demanded were things of value.

        2.      Third party beneficiaries

        Douglas and Campbell argue that they could not have violated section 186(b)(1)
because they themselves never received a “thing of value,” but plainly, this is not a
requirement of the statute. Although section 186(b)(1) outlaws receiving or accepting
things of value, it outlaws requesting or demanding them in the same statutory breath.
The plain language of the statute applies to demanding things of value, even if they are
intended for, and eventually go to, a third party.

        Furthermore, we find agreement from our sister circuits. In United States v.
DeBrouse, 652 F.2d 383, 387 (4th Cir. 1981), the defendant, president of Teamsters
Local 639, demanded that an employer pay $200 each week to a third party. The Fourth
Circuit held that the defendant received “the precise thing of value [he] demanded, that
Nos. 07-1695/1696/1850/1851           United States v. Douglas, et al.               Page 6

is, payment of $200 a week to [the third party]. Therefore, the fact that the thing of
value . . . took the form of payments to [a third party] does not place the transaction
beyond the scope of the Act.” Id. at 388. The court in DeBrouse also pointed out that
Congress exempted a number of types of transactions from the Act, but it did not exempt
payments to third party beneficiaries. Id. Additionally, in United States v. Carlock, 806
F.2d 535, 555 (5th Cir. 1986), the Fifth Circuit adopted the third party beneficiary theory
in DeBrouse.

        Accordingly, Douglas and Campbell violated section 186(b)(1) by demanding
a thing of value for third party beneficiaries.

        3.      Constructive amendment

        Campbell contends that the jury instructions constructively amended the
indictment by permitting the jury to convict on the basis of an uncharged third-party-
beneficiary theory. We have explained that jury instructions constructively amend an
indictment when they “modify essential elements of the offense charged [so] that there
is a substantial likelihood that the defendant may have been convicted of an offense
other than the one charged in the indictment.” Budd, 496 F.3d at 521 (internal quotation
marks omitted).

        In this case, the jury instructions did not constructively amend the indictment.
The indictment alleges that the defendants “unlawfully . . . demand[ed] . . . the payment
. . . of money and things of value in excess of $1,000.00 from General Motors, to wit:
[1] the skilled trades and/or journeyman designation . . . and [2] employment under that
designation with associated wages and benefits for Gordon Campbell and Todd Fante,
whom the defendants knew were not qualified.” (emphasis added). The indictment
clearly put Douglas and Campbell on notice that the United States intended to proceed
based upon a third-party-beneficiary theory. Jury instructions to that effect, then, did not
constructively amend the indictment.
Nos. 07-1695/1696/1850/1851          United States v. Douglas, et al.                Page 7

B.     The Hobbs Act

       Douglas and Campbell argue that their actions cannot form the basis for criminal
liability and be “wrongful” under the Hobbs Act, 18 U.S.C. § 1951(b)(2), merely
because the actions violated a collective-bargaining agreement between General Motors
and the Union. United States v. Enmons, 410 U.S. 396, 401, 408 (1973), clarified that
a “wrongful” purpose is one “that the union officials had no legitimate right to demand.”
While the defendants brief this point at length, this panel’s prior decision in this case
forecloses any argument about the legal standard:

       The defendants’ demands, as alleged by the United States, are
       illegitimate, as they were in Cusmano and Russo, and constitute extortion
       because they were in contradiction of the collective bargaining
       agreement and the union’s Constitution. Like the unlawful agreement at
       issue in Cusmano, the “skilled trades proposal” allegedly was obtained
       outside the traditional labor/management bargaining context. Also, the
       proposal, as alleged, contradicted a contractual provision between the
       union and the employers that gave preference to qualified, eligible
       employees of Pontiac in the distribution of skilled trade jobs and required
       at a minimum that those who are hired meet specific standards. We
       conclude that this is one of those instances, referenced by the Supreme
       Court in Enmons, to which the Hobbs Act would apply.

Douglas, 398 F.3d at 415 (emphasis added).

       The only remaining question is whether the evidence at trial proved what the
indictment asserted. We review “the evidence in the light most favorable to the
prosecution” and ask whether “any rational trier of fact could have found the essential
elements of the crime beyond a reasonable doubt.” Jackson v. Virginia, 443 U.S. 307,
319 (1979). Under this standard, the evidence sufficed. The evidence demonstrated that
Douglas and Campbell had a purpose that violated the National Agreement—forcing
General Motors to hire two people who were not qualified and did not have preference
under the National Agreement. Even though labor negotiations were ongoing at the
time, Douglas’s and Campbell’s demand that General Motors violate the National
Agreement was an action “outside the traditional labor/management bargaining context”
Nos. 07-1695/1696/1850/1851           United States v. Douglas, et al.             Page 8

because they demanded something to which they had no legitimate right. The fact that
other new positions were created does not alter our conclusion.

       Accordingly, Douglas’s and Campbell’s actions fell within the Hobbs Act’s
definition of wrongful.

C.     Brady Violation

       Douglas and Campbell claim that the United States violated Brady v. Maryland,
373 U.S. 83 (1963), when it failed to disclose to them the conviction of one of their
witnesses, Mark Hawkins. “[T]here is some confusion in this circuit with respect to the
appropriate standard of review to apply to the denial of a motion for a new trial based
on Brady violations.” United States v. Heriot, 496 F.3d 601, 605 (6th Cir. 2007)
(documenting both de novo and abuse-of-discretion review, as well as one attempt to
reconcile the two standards). However, we are not forced to decide between the two
standards because our decision is clear even under the less deferential de novo standard.

       Brady violations have three elements: “[1] [t]he evidence at issue must be
favorable to the accused, either because it is exculpatory, or because it is impeaching;
[2] that evidence must have been suppressed by the State, either willfully or
inadvertently; and [3] prejudice must have ensued.” Strickler v. Greene, 527 U.S. 263,
281-82 (1999). To establish prejudice, “the nondisclosure [must have been] so serious
that there is a reasonable probability that the suppressed evidence would have produced
a different verdict.” Id. at 282.

       In 1988, approximately eighteen years before Douglas’s and Campbell’s trial,
Hawkins pleaded guilty to attempted receipt or concealment of a stolen “pleasure boat”
and “outboard motor” valued over one hundred dollars. He served thirty days in jail.
Douglas and Campbell claim that they learned of the conviction only after the case had
been submitted to the jury. The district court denied their motion for a new trial because
the evidence of Hawkins’s prior conviction was “immaterial.” The crime occurred
eighteen years before trial and eight years before the conduct for which the defendants
were convicted. Moreover, Hawkins’s testimony “consisted primarily of general
Nos. 07-1695/1696/1850/1851          United States v. Douglas, et al.             Page 9

background information on union matters, and any statements he made regarding
Defendants’ actions were corroborated by other witnesses.”

       The record bears out the district court’s assessment. While Douglas and
Campbell mention several matters about which Hawkins testified, they only point to one
fact about which no other witness testified—that Douglas and Campbell protracted
negotiations for the 1995 Validation Center move. Even assuming that they are correct,
that fact was in no way essential to either conviction. Therefore, Hawkins’s testimony
was not prejudicial, and Douglas’s and Campbell’s Brady claim fails.

D.     Sentencing

       The Probation Office’s Presentence Reports calculated both Douglas’s and
Campbell’s sentences using United States Sentencing Guideline section 2B3.3 for
Blackmail and Similar Forms of Extortion, which provides a base offense level of nine.
It added four points for a loss to General Motors exceeding $20,000 according to
sections 2B3.3(b)(1) and 2F1.1(b)(1)(E), and two points for abuse of trust according to
section 3B1.3. The resulting total offense level was fifteen. Both Douglas and Campbell
had a criminal history category of I, yielding an advisory sentencing range of one and
a half years to two years of imprisonment. The United States objected to the use of
section 2B3.3 and argued instead for section 2B3.2. It also argued for a higher amount
of loss, while Douglas and Campbell claimed that General Motors had lost nothing.

       The district court sentenced both defendants according to section 2B3.3 and did
not impose a loss enhancement. With an offense level of eleven, the resulting sentencing
range was eight months to one year and two months of imprisonment. Because
Campbell had lung cancer, the district court reduced his offense level by three. This
resulted in a sentencing range of zero to six months of imprisonment. The court
sentenced Campbell to no imprisonment, two years of probation including six months
of house arrest, and a $4,000 fine. The district court found that the section 3553(a)
factors pointed toward “the same conclusion” for Douglas, reduced his total offense level
by three, and imposed on Douglas the same sentence that Campbell had received. As
opposed to Campbell, Douglas was healthy.
Nos. 07-1695/1696/1850/1851            United States v. Douglas, et al.             Page 10

        We review de novo whether a district court imposed the correct Sentencing
Guideline. United States v. Rivera, 516 F.3d 500, 502 (6th Cir. 2008). We will reverse
a district court’s finding of fact as to the loss attributed to a defendant only if it was
clearly erroneous. United States v. Jordan, 544 F.3d 656, 671 (6th Cir. 2009). However,
we review de novo whether those factual findings warranted the district court’s
application of a certain Guideline. United States v. Triana, 468 F.3d 308, 321 (6th Cir.
2006). Finally, we review sentences for abuse of discretion “[r]egardless of whether the
sentence imposed is inside or outside the Guidelines range.” United States v. Gall, 552
U.S. 38, 51 (2007).

        1.      Using the blackmail versus extortion Guideline

        The district court calculated the sentences using section 2B3.3, which governs
“blackmail and similar forms of extortion where there clearly is no threat of violence to
person or property.” U.S.S.G. § 2B3.3 cmt. n.1 (1995). That section defines blackmail
as “a threat to disclose a violation of United States law unless money or some other item
of value is given.” Id. The United States believes this choice was in error because
section 2B3.2, “Extortion by Force or Threat of Injury or Serious Damage,” better
captures Douglas’s and Campbell’s conduct. Id. § 2B3.2. Section 2B3.2 applies when
defendants make a threat:

        that reasonably could be interpreted as one to injure a person or
        physically damage property, or any comparably serious threat, such as
        to drive an enterprise out of business. Even if the threat does not in itself
        imply violence, the possibility of violence or serious adverse
        consequences may be inferred from the circumstances of the threat or the
        reputation of the person making it. An ambiguous threat, such as “pay
        up or else,” or a threat to cause labor problems, ordinarily should be
        treated under this section.

Id. § 2B3.2 cmt. n.2 (emphasis added). “[C]ommentary in the Guidelines Manual that
interprets or explains a guideline is authoritative unless it violates the Constitution or a
federal statute, or is inconsistent with, or a plainly erroneous reading of, that guideline.”
Nos. 07-1695/1696/1850/1851                 United States v. Douglas, et al.                   Page 11

Stinson v. United States, 508 U.S. 36, 38 (1993).1 Section 2B3.2 sets a base offense
level of eighteen, which is twice the level of the blackmail Guideline in section 2B3.3.

         The district court erred in applying section 2B3.3 and should have applied
section 2B3.2. The difference between the two sections is the type of action threatened.
Section 2B3.3 contemplates blackmail, which is defined as threatening to reveal a
violation of federal law unless money or some other item of value is given, and similar
threats. These types of threats involve making public an established fact; revealing that
which already exists. In a sense, the victim of blackmail created the possibility for his
injury. Quite differently, section 2B3.2 contemplates extortion by force or threat of
injury or serious damage. These types of threats involve attacks upon more “innocent”
victims who have in no way brought upon themselves any harm. Furthermore, both
sections contemplate that a threat is covered by one or the other, not both. See U.S.S.G.
§ 2B3.3(c)(2) (“If the offense involved extortion by force or threat of injury or serious
damage, apply § 2B3.2.”).

         Douglas and Campbell argue that the threat did not rise to the serious levels
explained in section 2B3.2 because the threatened action would not have driven General
Motors out of business. However, even assuming that an on-going strike would not have
terminated General Motors entirely, that assertion ignores that the Pontiac plant might
have been crippled or ruined. Cf. United States v. Williams, 952 F.2d 1504 (6th Cir.
1991) (holding that section 2B3.2 applied where defendant threatened to thwart rezoning
of only one of real estate company’s projects, which would have ruined the project and
not the company as a whole); United States v. Boggi, 74 F.3d 470, 477 (3d Cir. 1996)
(holding that section 2B3.2 could apply where defendant made “threats of labor strikes
and labor unrest that would result in economic injury, or ruin, for a given project” run
by a real estate developer).

         As the state of Michigan has sadly witnessed time and time again, large
automotive manufacturers will close and consolidate plants if necessary, especially if

         1
          Stinson is still good law after Booker. See, e.g., United States v. Lay, 583 F.3d 436, 446 (6th
Cir. 2009) (“The Commentary is ‘authoritative.’” (quoting Stinson, 508 U.S. at 38)).
Nos. 07-1695/1696/1850/1851           United States v. Douglas, et al.            Page 12

doing so will result in more favorable labor conditions. Here, Douglas and Campbell
threatened to prolong an already lengthy and costly strike. Even though General Motors
is a multi-billion dollar company, its total worth is spread across many plants. Each day
of the strike cost the Pontiac plant millions of dollars. Having lost millions of dollars
each day for eighty-seven consecutive days, and facing an indefinite continuance of the
strike, General Motors was threatened with undeniably grievous damages. This threat
falls comfortably in line with the language in section 2B3.2, which covers serious threats
to cause labor problems. In fact, the district court even admitted during Campbell’s
sentencing hearing that no blackmail had occurred in this case. Upon remand, the
district court should apply section 2B3.2.

       2.       The loss to General Motors

       The Probation Office proposed that General Motors suffered a loss of $30,474.76
as a result of complying with Douglas’s and Campbell’s threat, and accordingly
proposed a four-level enhancement to Douglas’s and Campbell’s offense levels. It
measured the loss according to the salaries that General Motors paid to the unqualified
relatives before GM “evaluated and retained” those men “based on their work
performance.”    The United States, Douglas, and Campbell all objected to this
recommendation. The district court rejected the loss enhancement entirely because the
relatives performed their jobs well and caused General Motors no “workplace loss.” In
other words, General Motors obtained valuable services in exchange for the salaries that
it paid. The United States appeals the loss determination.

       First, the parties disagree about whether “workplace loss” is a meaningful
measure in an extortion case. Douglas and Campbell cite many older cases in which
courts concluded that the value of fraudulently provided services offset any loss for
purposes of loss calculation. See, e.g., United States v. Maurello, 76 F.3d 1304, 1311-12
(3d Cir. 1996) (“A client who obtains a satisfactory contract, settlement, or verdict has
received something of value, irrespective of whether the lawyer was licensed at the
time.”). The United States distinguishes fraudulent services from the services provided
in this case because “GM did not ask for these services; rather, it was forced to create
Nos. 07-1695/1696/1850/1851          United States v. Douglas, et al.            Page 13

two new positions” for people who were not qualified as journeymen. According to the
record, General Motors might not have hired the unqualified relatives were it not for the
threat, but the company would have filled these positions with other applicants
regardless. Furthermore, based on General Motors’s choice to retain the employees, we
can only assume that they performed satisfactorily and General Motors “got its money’s
worth.” Therefore, the district court’s finding that General Motors did not suffer any
direct loss by hiring and paying the relatives is not clearly erroneous.

       Second, the district court did not consider General Motors’s consequential losses.
Section 2B3.2 expressly anticipates consequential losses, see U.S.S.G. § 2B3.2 cmt. 5,
but consequential losses are irrelevant under section 2B3.3, which looks only at “the
greater of the amount obtained or demanded,” U.S.S.G. § 2B3.3(b)(1). Because we
conclude that the district court should have applied section 2B3.2, the district court
should have also determined whether General Motors suffered any consequential losses.

       Here, when General Motors hired the non-qualified relatives, they violated the
hiring priorities set forth in the national and local Union agreements. As a result,
multiple qualified Union members filed grievances because they should have had higher
priority. General Motors had to pay $450,000 in legal fees, plus salaries and expenses
for in-house counsel, and the salaries for two Union members who were hired as
journeymen as a way to settle their grievances. The district court did not make a factual
finding as to consequential damages. Therefore, on remand, the district court must
calculate consequential damages to General Motors according to section 2B3.2(b)(2),
and apply the appropriate offense level enhancement.

       3.      Downward variance in Douglas’s sentence

       While the district court’s use of the incorrect Guidelines section requires that we
remand this matter for resentencing, the United States additionally claims that Douglas’s
sentence is substantively unreasonable because the district court relied upon an improper
factor—the disparity between Douglas’s and Campbell’s sentences. Pursuant to section
5H1.4, Campbell received a downward departure equivalent to three offense levels
because he had lung cancer. Although Douglas was not ill, the district court reduced his
Nos. 07-1695/1696/1850/1851          United States v. Douglas, et al.            Page 14

offense level by the same amount to “avoid unwarranted sentencing disparities among
defendants with similar records who have been found guilty of similar conduct.”

       Sentencing decisions must be both procedurally and substantively reasonable.
Gall, 552 U.S. at 51. Here, we need not address the substantive reasonableness of
Douglas’s sentence because it was procedurally unreasonable on two separate grounds.
First, as we have already explained, the district court improperly applied the blackmail
Guideline, resulting in a lower offense level and sentencing range. Cf. United States v.
Rosenbaum, 585 F.3d 259, 265 (6th Cir. 2009) (“A sentencing court commits procedural
error by failing to calculate (or improperly calculating) the Guidelines range . . . .”).
Second, the district court reduced Douglas’s offense level by three points without an
applicable section of the Guidelines to support the reduction. Cf. United States v.
Goodman, 519 F.3d 310, 323 (6th Cir. 2008). The court admitted that “no departure
[was] actually available,” but reduced Douglas’s offense level nevertheless so that it
could give him a within-Guidelines sentence that was the same as Campbell’s. When
determining whether to vary downward from a properly calculated sentencing range, a
district court may consider the sentencing disparity between co-defendants. See United
States v. Presley, 547 F.3d 625, 631-32 (6th Cir. 2008) (explaining that district courts
may consider sentencing disparities between co-defendants if they so wish). However,
reducing a defendant’s offense level is a different animal entirely. It requires an
applicable Guideline section, and here, while the disparity may have supported a
downward variance, it did not support a reduction in Douglas’s offense level.

                                 III. CONCLUSION

       Douglas and Campbell violated section 186(b) of the Labor Management
Relations Act by threatening to lengthen a labor strike if jobs—things of value—were
not given to two unqualified relatives of Union members—third party beneficiaries.
Furthermore, because this action flew in the face of the national and local Union
agreements, it was wrongful pursuant to the Hobbs Act. Accordingly, we AFFIRM
Douglas’s and Campbell’s convictions, but we REMAND for resentencing in
accordance with this opinion.