Court Opinion

ID: 4526756
Source: CourtListenerOpinion
Date Created: 2020-04-17 21:00:25.517447+00
Date Added: 2024-06-11T12:13:53.014173
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                         APR 17 2020
                                                                       MOLLY C. DWYER, CLERK
                                                                        U.S. COURT OF APPEALS
                            FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,                        No.    18-10291

                Plaintiff-Appellee,              D.C. No.
                                                 2:17-cr-00585-GMS-1
 v.

THOMAS MARIO COSTANZO,                           MEMORANDUM*

                Defendant-Appellant.

                   Appeal from the United States District Court
                            for the District of Arizona
                  G. Murray Snow, Chief District Judge, Presiding

                       Argued and Submitted March 3, 2020
                                Phoenix, Arizona

Before:      HAWKINS, OWENS, and BENNETT, Circuit Judges.

      Thomas Mario Costanzo was convicted of five counts of money laundering,

in violation of 18 U.S.C. § 1956(a)(3), and sentenced to a total of 41 months in prison

followed by three years of supervised release.         On appeal, he challenges the

admission of certain evidence, the calculation of his Sentencing Guidelines range,

      *
          This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
and two special conditions of his supervised release.1 We have jurisdiction under 28

U.S.C. § 1291, and we affirm in part, vacate in part, and remand to the district court.

      1.     Costanzo first contends that the district court erroneously admitted

three types of evidence: (1) the testimony of an individual who stated that he bought

bitcoin from and sold illicit drugs to Costanzo; (2) text messages from the spouse of

one of Costanzo’s customers, criticizing Costanzo for selling bitcoin to the customer

to facilitate a drug purchase; and (3) evidence establishing Costanzo’s anti-bank

beliefs. The district court did not abuse its discretion by admitting this evidence over

Costanzo’s objections under Federal Rules of Evidence 403 and 404(b). See United

States v. Lozano, 623 F.3d 1055, 1059–60 (9th Cir. 2010). Costanzo pursued an

entrapment defense, and the district court permissibly found that all three categories

of evidence tended to show that Costanzo had a predisposition for using bitcoin to

facilitate illicit transactions. See United States v. Mendoza-Prado, 314 F.3d 1099,

1103–04 (9th Cir. 2002).

      2.     Costanzo next contends that the district court erred in calculating the

applicable Sentencing Guidelines range by (1) failing to apply a downward

adjustment to his offense level for acceptance of responsibility under U.S.S.G.

1
      Costanzo also challenges the sufficiency of the evidence underlying his
convictions. We address that issue and affirm his convictions in an opinion filed
simultaneously with this disposition.

                                           2                                    18-10291
§ 3E1.1(a), and (2) applying a four-level enhancement under U.S.S.G.

§ 2S1.1(b)(2)(C)(ii).

      We afford “great deference” to the district court’s determination regarding

Costanzo’s acceptance of responsibility. See United States v. Scrivener, 189 F.3d
944, 948 (9th Cir. 1999). Contrary to Costanzo’s contention, the district court did

not reject his request for an acceptance of responsibility adjustment on a categorical

basis. Instead, the district court appropriately considered the record as a whole,

including Costanzo’s sentencing letter, and explained that Costanzo had not shown

a sufficient acceptance of responsibility to warrant a downward adjustment under

§ 3E1.1. See United States v. Ramos-Medina, 706 F.3d 932, 940 (9th Cir. 2013).

We cannot say that finding was clearly erroneous. See id. at 942.

      The record also supports application of the four-level enhancement under

U.S.S.G. § 2S1.1(b)(2)(C)(ii). The record contains evidence, including Costanzo’s

business advertisements, reputation in the peer-to-peer virtual currency business,

comments to undercover agents, interactions with prior customers, and the extended

nature of his dealings with the undercover agents, that could establish Costanzo was

“in the business of laundering funds” within the meaning of § 2S1.1(b)(2)(C)(ii).

See U.S.S.G. § 2S1.1 cmt. n.4

      3.     Finally, Costanzo contends that remand is warranted to address two

special conditions of his supervised release. The district court did not err by

                                          3                                   18-10291
imposing Condition 5, which prohibits “major purchases” and other financial

transactions exceeding $500 without prior approval from a probation officer. A

financial reporting condition is reasonably related to the 18 U.S.C. § 3553(a)

sentencing factors under the circumstances, particularly given the nature of the crime

and Costanzo’s history. Cf. United States v. Garcia, 522 F.3d 855, 862 (9th Cir.

2008). Further, it is apparent from the language of the condition that the $500

limitation applies to “major purchases,” “financial obligations,” and “financial

contracts” alike, such that the condition is not impermissibly vague. See United

States v. Ochoa, 932 F.3d 866, 869 (9th Cir. 2019) (explaining that a condition of

supervised release is impermissibly vague “if it uses terms so vague that it fails to

give a person of ordinary intelligence fair notice that it would apply to the conduct

contemplated” (internal quotation marks, citation, and alteration omitted)).

      Nor did the district court err by imposing a special condition prohibiting

Costanzo from using alcohol during his supervised release term. See United States

v. Sales, 476 F.3d 732, 735–36 (9th Cir. 2015). However, the written judgment is

broader than the oral pronouncement and precludes both the use and possession of

alcohol. Thus, as the government concedes, a limited remand is warranted to

conform the written judgment to the oral pronouncement. See United States v.

Hernandez, 795 F.3d 1159, 1169 (9th Cir. 2015).

      AFFIRMED, in part, VACATED, in part, and REMANDED.

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