United States v. Lucena-Rivera , 750 F.3d 43 ( 2014 )

United States Court of Appeals
For the First Circuit
No. 12-2200
UNITED STATES OF AMERICA,
Appellee,
v.
RAYMAR LUCENA-RIVERA,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. José Antonio Fusté, U.S. District Judge]
Before
Howard, Selya, and Lipez,
Circuit Judges.
Martin G. Weinberg, with whom Kimberly Homan was on brief, for
appellant.
Juan Carlos Reyes-Ramos, Assistant United States Attorney,
with whom Rosa Emilia Rodríguez-Vélez, United States Attorney, and
Nelson Pérez-Sosa, Assistant United States Attorney, were on brief,
for appellee.
April 24, 2014
LIPEZ, Circuit Judge. Appellant Raymar Lucena-Rivera is
currently serving a term of imprisonment of 220 months after
pleading guilty to one count of conspiring to commit money
laundering as set forth in a multi-count indictment that also
included drug-trafficking charges. In this sentencing appeal,
Lucena-Rivera argues that the district court erred in (1)
calculating the amount of laundered funds relevant to his base
offense level, (2) applying an enhancement for having a leadership
role, (3) applying an enhancement for being "in the business of
laundering funds," and (4) failing to adequately consider the
factors set forth in 18 U.S.C. § 3553(a). Essentially, Lucena-
Rivera contends that the district court unduly relied on evidence
concerning the underlying drug crimes rather than the money-
laundering itself when determining his sentence.
Although we disagree with that assessment, we nonetheless
conclude that more specific factual findings are necessary to allow
us to adequately review the application of the enhancement for
being "in the business of laundering funds." We find Lucena-
Rivera's other claims of error meritless. Hence, we will remand
the matter to the district court with directions to revisit only
the application of the enhancement for being "in the business of
laundering funds" while upholding the district court's other
sentencing determinations.
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I.
Because there was no trial, the underlying facts of the
case are taken from the plea agreement and pre-sentence
investigation report ("PSI").1
Lucena-Rivera had been engaged in money-laundering and
drug-trafficking activities for two years before the money-
laundering activities at issue in this case began in 2010. On
multiple occasions prior to 2010, he moved between 1,000 and 1,500
kilograms of cocaine into Puerto Rico, keeping some 200 to 300
kilograms for himself.
The transactions and activities relevant to Lucena-
Rivera's money-laundering conviction included the following
interactions with a DEA confidential source, who contacted Lucena-
Rivera in 2010 and introduced himself as someone in the drug-
trafficking business:
(1) $1,375,039 in cash delivered in plastic
containers to the confidential source on May 28,
2010, to be divided between a check for $125,000
made out to Lucmar Solutions Corp., $1,088,000
in cash delivered to Colombia as
payment for drugs, and the source's commission;
1
Lucena-Rivera objected to only three paragraphs of the PSI
(¶¶ 29, 34, and 86), thereby accepting the factual findings in the
remainder of the report.
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(2) a September 2010 meeting in Panama between
Lucena-Rivera, Edgardo Torres-Vázquez,2 two of
Lucena-Rivera's associates, and the
confidential source wherein the details of a
money-laundering transaction -- including the
denominations of the bills, the fee, and the
timing -- were discussed;
(3) $2,390,960 in cash delivered to the confidential
source on September 29, 2010, in exchange for
various checks for real estate expenditures,
including one made out to Joyuda Beach Resort
for $1,175,000;
(4) $465,200 in cash delivered to the confidential
source on September 30, 2010;
(5) $827,526 in cash delivered by the confidential
source to Lucena-Rivera's associates in Panama;
(6) $896,304 delivered to the confidential source on
November 23, 2010, $800,000 of
which was to be delivered in cash to Panama as
payment for drugs;
2
Torres-Vázquez also pleaded guilty to money-laundering. He
appealed his conviction on grounds of factual insufficiency and
sentencing error. We affirmed his conviction on the basis of
factual findings not relevant to Lucena-Rivera's appeal. See
United States v. Torres-Vázquez, 731 F.3d 41 (1st Cir. 2013).
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(7) $1,655,000 to be delivered by Edgardo Torres-
Vázquez to the confidential source in March
2011; and
(8) $592,956 left for the confidential source to
pick up and transport to New York as payment for
drugs in August 2011.
The total of the above-described transactions was over $7
million. Lucena-Rivera argued that $1,816,000 of the total amount
laundered, used to purchase properties, was not tied to drug
trafficking; therefore, it was not relevant to the charge of
promotional money laundering. Though expressing doubt as to the
factual and legal merit of this objection, the district court
nonetheless excluded that amount from its calculation.
Accordingly, the district court determined that the total amount
laundered for sentencing purposes was between $2.5 million and $7
million, triggering an eighteen-level increase to the base offense
under U.S.S.G. § 2S1.1(a)(2).
The government also pressed for three sentencing
enhancements -- a six-level enhancement for knowledge that any of
the laundered money was proceeds of, or intended to promote the
distribution of, a controlled substance; a four-level enhancement
for being "in the business of laundering funds"; and a four-level
enhancement for having a leadership role in the offense. Lucena-
Rivera did not object to the six-level enhancement based on his
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knowledge that the funds were involved in drug-trafficking, but did
object to the other two.
The district court rejected appellant's objections to the
two four-level enhancements. It found that the operation involved
more than five participants and was under the leadership of Lucena-
Rivera, thus warranting the application of a four-level enhancement
under § 3B1.1(a). The court also found that the four-level
enhancement under § 2S1.1(b)(2)(C) for being "in the business of
laundering funds" applied to Lucena-Rivera because of the
intertwined nature of his money laundering and drug trafficking
activities. These enhancements produced a total offense level of
37, which yielded a guideline range of 210-240 months (with the
upper limit being the statutory maximum).
The district court explained the sentence of 220 months
as follows:
[W]hat I will do is I will sentence him to
220 months, not to reach the statutory
maximum. It means nothing. But that's what
it is. It's like some sort of courtesy
adjustment, if you will. . . .
Don't doubt for a minute that I do think this
is -- this was a very closely intertwined
drug business and money laundering case.
Extremely closely intertwined. Very
difficult. Very difficult. Principles of
relevant conduct, when you look at the whole
thing, justify easily the level 18 on the
amount. Easily.
The court provided no further explanation of the sentence imposed,
nor did Lucena-Rivera request any.
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On appeal, Lucena-Rivera challenges the total offense
level calculation and the proffered reasons for the sentence.
Specifically, he contests the calculation of the quantity of
laundered funds; the applicability of the four-level enhancement
for having a leadership role; and the applicability of the
four-level enhancement for being "in the business of laundering
funds." As to the basis for the sentence, Lucena-Rivera further
argues that the district court did not adequately address the
factors under § 3553(a) and did not adequately explain the reasons
for the sentence imposed.
His appeal blends legal and factual arguments. To the
extent that his challenge is based on questions of law, we review
de novo. See United States v. Walker, 665 F.3d 212, 232 (1st Cir.
2011). To the extent that his challenge to an enhancement is based
on the factual findings of the district court, we review only to
determine whether those findings were "clearly erroneous." Id.II.
A. Amount of Laundered Funds
Lucena-Rivera first argues that the district court erred
in lumping together all of the cash amounts involved in the
transactions with the confidential source. Specifically, he
asserts that (1) concealment money laundering and promotional money
laundering are two distinct offenses and therefore any funds
laundered for concealing, rather than promoting, unlawful activity
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should not have been included in the quantity calculation for the
purposes of sentencing; and (2) the government had the burden of
proving that each money-laundering transaction involved funds that
were "proceeds of" completed drug transactions and failed to meet
that burden.
1. Promotional and Concealment Money Laundering
The money-laundering statute, 18 U.S.C. §
1956(a)(1)(A)(i),3 applies when an individual knowingly uses the
proceeds of an unlawful activity in a financial transaction "with
the intent to promote the carrying on of specified unlawful
activity." 18 U.S.C. § 1956(a)(1)(A)(i). Another provision of
§ 1956(a)(1) applies when an individual knowingly uses the proceeds
of an unlawful activity in a financial transaction "to conceal or
disguise the nature, the location, the source, the ownership, or
the control of the proceeds of specified unlawful activity." 18
U.S.C. § 1956(a)(1)(B)(i).
3
The indictment included one count of conspiracy to launder
monetary instruments. That count cited overt acts that were also
charged as separate counts of money laundering. Each of those
money-laundering counts charged Lucena-Rivera with a violation of
18 U.S.C. § 1956(a)(1)(A)(i) and alleged that he "did knowingly
conduct and attempt to conduct a financial transaction affecting
interstate and foreign commerce . . . that involved the proceeds of
a specified unlawful activity, that is: [drug trafficking] . . .
with the intent to promote the carrying on of specified unlawful
activity" (emphasis added). Lucena-Rivera's plea agreement
required him to plead only to the overarching conspiracy charge
rather than to each count of money laundering separately.
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Lucena-Rivera contends that those two subparts of the
money-laundering statute are separate crimes -- promotional money
laundering and concealment money laundering, respectively.
Following from that argument, he claims that, as a matter of law,
the quantity of funds used to calculate his total offense level
should have included only those funds that were laundered for
promoting illegal activity, rather than for concealing the source
of the funds. The government responds that there is only one crime
-- money laundering -- and that, whatever the purposes of the
laundering, all of the funds should be considered in sentencing
determinations.
We have previously described promotional and concealment
money laundering as two different "modalities" of the same offense.
United States v. Cedeño-Pérez, 579 F.3d 54, 57 (1st Cir. 2009)
(citing United States v. Iacaboni, 363 F.3d 1, 4 n.7 (1st Cir.
2004)); see also United States v. García-Torres, 341 F.3d 61, 65-66
(1st Cir. 2003). In Cedeño-Pérez there was only one count of
conspiracy to commit money laundering, but the indictment charged
the defendant with conspiring to commit both modalities. 579 F.3d
at 57. That treatment of the offense as a single crime with
different modalities comports with the government's position here,
as well as with our sister circuits' views. See, e.g., United
States v. Bolden, 325 F.3d 471, 487 n.19 (4th Cir. 2003); United
States v. Booth, 309 F.3d 566, 571-72 (9th Cir. 2002); United
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States v. Holmes, 44 F.3d 1150, 1155-56 (2d Cir. 1995); accord
United States v. Meshack, 225 F.3d 556, 580 n.23 (5th Cir. 2000),
amended by 244 F.3d 367 (5th Cir. 2001) (per curiam); United States
v. Navarro, 145 F.3d 580, 592 (3d Cir. 1998).
Consistent with precedent, we reaffirm that promotional
and concealment money laundering are not distinct crimes, but
rather alternative means of committing the general offense of money
laundering. Accordingly, in calculating the total amount of funds
laundered for the purposes of sentencing, the district court did
not have to distinguish between those funds that may have been
laundered for concealment rather than for promotion.
2. Proof as to Source of Funds
Lucena-Rivera argues that the government bore the burden
of proving by a preponderance of the evidence that the funds
involved in each separate money-laundering transaction included in
the total amount calculation were the "proceeds of" a specific type
of unlawful act -- namely, drug-trafficking.4 Lucena-Rivera
acknowledges that the government need not point to the specific
street-level drug deals that generated the ultimately laundered
4
As discussed in Part I, supra, Lucena-Rivera conceded the
applicability of the six-level enhancement pursuant to U.S.S.G. §
2S1.1(b)(1), which amounted to an admission that he "knew or
believed that any of the laundered funds were the proceeds of, or
were intended to promote" drug-trafficking. Id. (emphasis added).
In contesting the total amount calculation on appeal, he argues
that the government failed to show that all of the laundered funds
involved in the transactions at issue were "proceeds of" drug-
trafficking.
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funds. He nonetheless argues that, for each money-laundering
transaction, the general source of the funds must be identified and
the funds must have already been exchanged for drugs in a completed
transaction before they can be considered "proceeds of" unlawful
activity.
Drawing on these indisputable propositions, Lucena-Rivera
then emphasizes the distinction between collecting money as
"proceeds" of prior drug deals and later using that money to
"promote" unlawful activity by purchasing more drugs in the future.
He claims that the government and the district court wrongly
conflated the two activities in evaluating the evidence on whether
the laundered funds were "proceeds" of prior drug deals.
Other circuits have specifically addressed the potential
conflation of the "proceeds" and "promotion" elements. Courts have
recognized that simply because money is used to promote future
unlawful activity it does not necessarily follow that the money was
earned through prior unlawful activity. In recognizing this
distinction, the Fifth Circuit has indeed held that "funds do not
become the proceeds of drug trafficking until a sale of drugs is
completed," and found that the government failed to prove this
element by simply showing that the money was eventually exchanged
for drugs post-laundering. United States v. Gaytan, 74 F.3d 545,
555-556 (5th Cir. 1996) (citing United States v. Puig-Infante, 19
F.3d 929, 939 (5th Cir. 1994)); see also United States v. Harris,
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666 F.3d 905, 910 (5th Cir. 2012) (reaffirming the rule that
"[m]oney does not become proceeds of illegal activity until the
unlawful activity is complete [and the principle that] [t]he crime
of money laundering is targeted at the activities that generally
follow the unlawful activity in time").
Although the district court unquestionably considered
evidence that the laundered funds were involved in future drug
deals, there is no indication that the district court unduly relied
on such evidence in making its determination that those funds were
"proceeds of" prior drug deals. In the context of a long-running
criminal conspiracy, we think it appropriate to consider the use of
laundered funds for the perpetuation of an unlawful activity as
circumstantial, but not conclusive, evidence that those funds were
derived from that same unlawful activity.
The record also included evidence that went beyond simply
demonstrating that the funds were used to purchase drugs in the
future. According to the PSI, Lucena-Rivera had been transporting
drugs for a drug-trafficking organization for two years prior to
2010, moving between 1,000 and 1,500 kilograms of cocaine at a time
into Puerto Rico. The PSI further set forth numerous conversations
between Lucena-Rivera and the DEA's confidential source about
drug-trafficking activities involving Lucena-Rivera and his
associates.
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Finally, the PSI also set forth Lucena-Rivera's reported
income for the tax years 2005-2010. That income was insufficient
to supply the quantity of funds involved in the transactions at
issue as well as to support Lucena-Rivera's purchases of real
estate, cars, and other assets. Under the circumstances, it was
reasonable for the district court to conclude by a preponderance of
the evidence that more than $2.5 million of the laundered funds
were the proceeds of Lucena-Rivera's earlier drug-trafficking
activities.
B. Role-in-the-Offense Enhancement
To impose the four-level leadership enhancement under
U.S.S.G. § 3B1.1(a), the district court is required to make two
findings: "(1) a 'status determination,' i.e., that 'the defendant
acted as an organizer or leader of the criminal activity,' [and]
(2) a 'scope determination,' i.e., 'that the criminal activity met
either the numerosity or the extensiveness benchmarks established
by the guideline.'" United States v. Carrero-Hernández, 643 F.3d
344, 350 (1st Cir. 2011) (quoting United States v. Tejada-Beltrán,
50 F.3d 105, 111 (1st Cir. 1995)). Lucena-Rivera contends that the
government failed to prove either of these elements by a
preponderance of the evidence, and, therefore, the district court
erred in finding that the enhancement applied.
As to status, Lucena-Rivera is indeed correct that we
draw an important distinction between "organizing criminal
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activities and organizing criminal actors." Carrero-Hernández, 643
F.3d at 350 (emphasis omitted). To apply an enhancement under §
3B1.1(a), the district court must find that a defendant exercised
control over criminal actors, rather than just planned criminal
activity. Id. at 350-51 (quoting United States v. Jones, 523 F.3d
31, 43 (1st Cir. 2008) ("[I]t is not enough that the defendant
merely controlled, organized, or managed criminal activities[; he]
must instead control, organize, or manage criminal actors.")).
This status determination is distinct from the numerosity
determination and simply asks whether the defendant exercised
control over any other criminal actors. Hence, to satisfy the
status element, "[r]egardless of whether the criminal activity
involved five or more participants or was otherwise extensive, . .
. a defendant needs only to have led or organized one criminal
participant, besides himself of course." United States v. Arbour,
559 F.3d 50, 56 (1st Cir. 2009).
The PSI summarizes Lucena-Rivera's own description of his
operation to the DEA confidential source upon their first meeting,
which included the assurance that he paid his employees well to
prevent them from talking if arrested. The PSI also describes
several money-laundering transactions that involved participants in
addition to Lucena-Rivera who appeared to be under his direction.
The most prominent example is the March 2011 transaction in which
Torres-Vázquez delivered money from Lucena-Rivera to the DEA
-14-
confidential source.5 Lastly, the PSI makes repeated references to
Lucena-Rivera's "partners" and "employees." Accordingly, the
district court's finding that Lucena-Rivera led or organized other
participants was not clearly erroneous.
As to scope, Lucena-Rivera does not dispute that more
than five individuals were involved in his drug-trafficking
operation, but contends that there was no basis to conclude that
those individuals were also involved in the money-laundering
offense of conviction. The Introductory Commentary to Chapter 3,
Part B provides that "[t]he determination of a defendant's role in
the offense is to be made on the basis of all conduct within the
scope of § 1B1.3 (Relevant Conduct) . . . and not solely on the
basis of elements and acts cited in the count of conviction."
U.S.S.G. ch.3, pt. B, introductory cmt. Section 1B1.3(a)(1)(A)
includes in the definition of relevant conduct "all acts and
omissions committed, aided, abetted, counseled, commanded, induced,
procured, or willfully caused by the defendant . . . that occurred
during the commission of the offense of conviction, in preparation
for that offense, or in the course of attempting to avoid detection
or responsibility for that offense" (emphasis added).
Here, the drug-trafficking activity was a necessary
precursor to the money-laundering offense of conviction.
5
Contrary to Lucena-Rivera's contention, the undisputed facts
contained in the PSI support the conclusion that he organized or
led Torres-Vázquez.
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Accordingly, the court's conclusion that the criminal activity
involved five or more participants was not clearly erroneous.6
C. "In the Business of Laundering Funds"
The money-laundering Guidelines set forth in U.S.S.G. §
2S1.1 begin by laying out two different methods for calculating the
base offense level.7 Under U.S.S.G. § 2S1.1(a)(1) the base offense
6
Lucena-Rivera attempts to blunt the force of this conclusion
by arguing that relevant conduct cannot be considered in these
circumstances. He points to § 2S1.1, Application Note 2(C), which
states that 'in cases in which subsection (a)(1) applies,
application of any Chapter Three [role-in-the-offense] adjustment
shall be determined based on the offense conduct covered by this
guideline (i.e., the laundering of criminally derived funds) and
not on the underlying offense from which the laundered funds were
derived.' U.S.S.G. § 2S1.1, cmt. n.2(C). Lucena-Rivera
acknowledges that by its own terms this Application Note applies
only to cases in which subsection (a)(1) applies and that he was
appropriately sentenced under subsection (a)(2). However, because
the district court found that he was involved in the underlying
drug trafficking conduct, and because subsection (a)(1) applies to
defendants who committed or could be held accountable for the
underlying offense, he urges us nonetheless to apply this
provision.
This argument fails because Lucena-Rivera cannot have it
both ways; his concession that the district court appropriately
sentenced him under subsection (a)(2) is dispositive. Given this
concession, there is simply no basis for using the Application Note
relevant to subsection (a)(1).
7
U.S.S.G. § 2S1.1 reads as follows:
(a) Base Offense Level:
(1) The offense level for the underlying
offense from which the laundered funds were
derived, if (A) the defendant committed the
underlying offense (or would be accountable
for the underlying offense under subsection
(a)(1)(A) of § 1B1.3 (Relevant Conduct)); and
(B) the offense level for that offense can be
determined; or
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level for the money-laundering charge is the same as the base
offense level for the underlying offense from which the laundered
funds were derived if "(A) the defendant committed the underlying
offense (or would be accountable for the underlying offense under
[principles of relevant conduct]); and (B) the offense level for
that offense can be determined." Under this method, a defendant
(2) 8 plus the number of offense levels from
the table in § 2B1.1 (Theft, Property
Destruction, and Fraud) corresponding to the
value of the laundered funds, otherwise.
(b) Specific Offense Characteristics
(1) If (A) subsection (a)(2) applies; and (B)
the defendant knew or believed that any of the
laundered funds were the proceeds of, or were
intended to promote (i) an offense involving
the manufacture, importation, or distribution
of a controlled substance or a listed
chemical; (ii) a crime of violence; or (iii)
an offense involving firearms, explosives,
national security, or the sexual exploitation
of a minor, increase by 6 levels.
(2) (Apply the Greatest):
(A) If the defendant was convicted under
18 U.S.C. § 1957, increase by 1 level.
(B) If the defendant was convicted under
18 U.S.C. § 1956, increase by 2 levels.
(C) If (i) subsection (a)(2)
applies; and (ii) the defendant was
in the b u s i n e s s o f
laundering funds, increase by 4
levels.
(3) If (A) subsection (b)(2)(B) applies; and
(B) the offense involved sophisticated
laundering, increase by 2 levels.
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who launders the proceeds of his crimes, and is only convicted of
money laundering, is susceptible to punishment equivalent to the
punishment applicable to the underlying criminal activity. See
United States v. Descent, 292 F.3d 703, 708-09 (11th Cir. 2002)
(per curiam) (explaining that the change in the Guidelines to make
reference to the underlying offense was an effort to have the
sentence better reflect the culpability of the defendant).
However, if either of the elements of subsection (a)(1) is not
satisfied, the base offense level for the money-laundering charge
is calculated pursuant to U.S.S.G. § 2S1.1(a)(2), which
incorporates the tables that provide base offense levels for other
crimes involving illegally obtained funds. Here, both parties
agreed that subsection (a)(2) applied. Hence, we focus on the
district court's application of the enhancement for being "in the
business of laundering funds" set forth in § 2S1.1(b)(2)(C).
That application requires the district court to examine
the totality of the circumstances to decide whether a defendant was
"in the business of laundering funds." See U.S.S.G. § 2S1.1 cmt.
n.4. The Application Note to the Guideline directs the court to
consider the following non-exhaustive list of factors:
(i) The defendant regularly engaged in
laundering funds.
(ii) The defendant engaged in laundering
funds during an extended period of time.
(iii) The defendant engaged in laundering
funds from multiple sources.
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(iv) The defendant generated a substantial
amount of revenue in return for laundering
funds.
(v) At the time the defendant committed
the instant offense, the defendant had one or
more prior convictions [related to money
laundering or international financial
transactions] . . .
(vi) During the course of an undercover
government investigation, the defendant made
statements that the defendant engaged in any
of the conduct described in subdivisions (i)
through (iv).
Id.
Neither party suggests an alternative definition of what
it means to be "in the business of laundering funds." We have also
declined to adopt a firm definition of the term, instead pointing
the district courts to the Sentencing Commission's commentary to
the 2003 revision to § 2S1.1.8 As to who is subject to the
"business" enhancement, "'[t]he Commission determined that, similar
to a professional "fence", see § 2B1.1(b)(4)(B), defendants who
routinely engage in laundering funds on behalf of others, and who
gain financially from engaging in such transactions, warrant
substantial additional punishment because they encourage the
commission of additional criminal conduct.'" United States v.
8
Among other things, the 2003 revision consolidated the money
laundering guidelines, previously §§ 2S1.1 (Laundering of Monetary
Instruments) and 2S1.2 (Engaging in Monetary Transactions in
Property Derived from Specified Unlawful Activity). It reflected
an attempt to make the penalty structure address more "adequately
the culpability of the defendant or the seriousness of the money
laundering conduct." U.S.S.G. app. C, vol. II, at 227 (2003).
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Aguasvivas-Castillo, 668 F.3d 7, 14 (1st Cir. 2012) (quoting
U.S.S.G. app. C, vol. II, at 228-29 (2003)).
The district court specifically acknowledged the factors
set forth in the Application Note but made no factual findings as
to their existence. Instead, the district court focused on the
"intertwined" nature of the drug-trafficking and money-laundering
businesses and little else. Though the underlying drug-trafficking
activity may have constituted "relevant conduct" for the purpose of
applying the other enhancements to the money-laundering conviction,
it is not encompassed by the list of factors set forth in the
Application Note for evaluating the "business" enhancement.
The lack of adequate findings on the factors set forth in
the Application Note prevents us from reviewing appropriately the
application of the enhancement. Accordingly, we will follow the
practice, reaffirmed in United States v. Quinones, 26 F.3d 213,
219-220 (1st Cir. 1994), of remanding the matter to the district
court with directions to revisit, on the basis of the existing
record, the application of the enhancement for being "in the
business of laundering funds." On remand the district court can
elect to either (a) vacate the sentence and conduct a new
sentencing hearing to resentence Lucena-Rivera without the
application of the enhancement,9 or (b) reaffirm the sentence
9
We emphasize that any new sentencing hearing would be
limited to simply resentencing Lucena-Rivera on the basis of an
offense level and guideline range calculation that did not include
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previously imposed, filing with the clerk of the district court
written findings, based upon the existing record and consistent
with this opinion, as to the application of the enhancement.
Before making its decision between these courses of action, the
district court has discretion to hold a hearing and invite attorney
argument on the question of whether the existing record would
support the findings necessary to apply the enhancement. See id.at 220 n.9. As we noted in Quinones, this approach is appropriate
when the basis in the sentencing record for the application of an
enhancement requires clarification. See id. at 219 (citing United
States v. Levy, 897 F.2d 596, 599 (1st Cir. 1990), and United
States v. Parra-Ibanez, 951 F.2d 21, 22 (1st Cir. 1991)).
We therefore withhold judgment and remand the matter to
the district court. The district court shall notify the clerk of
this court as to which option it chooses within twenty days of the
date of this order. Should the court elect to proffer written
findings rather than resentence Lucena-Rivera, those findings must
be filed with the clerk of the district court within sixty days of
the "business" enhancement. We note that Lucena-Rivera concedes
that if the four-level "business" enhancement were not applied to
him, the two-level enhancement for "convict[ion] under 18 U.S.C. §
1956," the statute of conviction here, would apply in the
alternative. U.S.S.G. § 2S1.1(b)(2) (directing the court to apply
the greatest of a menu of "Specific Offense Characteristics"
enhancements). The resultant offense level would thus be 35 (as
opposed to the 37 calculated with the "business" enhancement), and
the new guideline range would be 168-210 months (as opposed to 210-
240 months).
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the court's notification, and thereafter promptly transmitted to
the clerk of this court. We will retain appellate jurisdiction
over the matter to assess the adequacy of those findings in due
course. However, should the district court indicate that it elects
to vacate Lucena-Rivera's sentence and resentence him without
applying the "business" enhancement, this court will issue judgment
remanding the case to the district court so that it can vacate the
sentence and proceed to resentencing.
D. Section 3553(a) Factors and the Explanation for the Sentence
When, as here, a defendant does not raise an objection to
the sentencing judge's explanation and alleged failure to address
the § 3553(a) factors in the district court, we review a subsequent
challenge to the adequacy of the sentencing analysis for plain
error. See United States v. Murphy-Cordero, 715 F.3d 398, 401 (1st
Cir. 2013).
1. Section 3553(a) Factors
In interpreting the procedural requirement to undertake
a § 3553(a) analysis, we have held that a sentencing court is not
obligated to conduct "'an express weighing of mitigating and
aggravating factors'" or "'individually mention[]'" each §
3553(a)factor. Id. at 401 (quoting United States v. Lozada-Aponte,
689 F.3d 791, 793 (1st Cir. 2012)). The inquiry on appeal thus
becomes whether "we are satisfied from the [district] court’s
limited explanation that it considered all of the applicable
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factors and viewed the [sentence] as sufficient to account for the
defendant’s individual circumstances." United States v. Zapata,
589 F.3d 475, 487 (1st Cir. 2009).
Here, the district court offered only a cursory
explanation for the sentence, saying that it reflected a "courtesy
adjustment."10 If that were the only explanation in the record, a
remand might well be warranted for further consideration and
explanation, even under the plain error standard. However, the
district court made references during the course of the sentencing
hearing indicating that other § 3553(a) factors were considered --
in particular the need for adequate deterrence under §
3553(a)(2)(B) and the seriousness of the offense under
§ 3553(a)(2)(A).
Specifically, in response to defense counsel's argument
that Lucena-Rivera was simply an intermediary (the "money man" as
he put it) and even a slight punishment for him would thus be
10
Although we quoted it earlier, the text of the district
court's explanation is reproduced here for convenience:
[W]hat I will do is I will sentence him to 220 months,
not to reach the statutory maximum. It means nothing.
But that's what it is. It's like some sort of courtesy
adjustment, if you will. . . .
Don't doubt for a minute that I do think this is -- this
was a very closely intertwined drug business and money
laundering case. Extremely closely intertwined. Very
difficult. Very difficult. Principles of relevant
conduct, when you look at the whole thing, justify easily
the level 18 on the amount. Easily.
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sufficient to send a message to drug-traffickers about the
culpability of everyone in their organization, the district court
took the view that a Guideline sentence was warranted because money
laundering is "an integral part of drug trafficking." The court
also emphasized the seriousness of the offense, concluding the
explanation for the sentence with the statement, "[p]rinciples of
relevant conduct, when you look at the whole thing, justify easily
the level 18 enhancement. Easily." As for Lucena-Rivera's
principal argument for a below-Guideline sentence on the basis of
his personal history and characteristics pursuant to § 3553(a)(1),11
the court's reference to a "courtesy adjustment," though
imprecisely worded, was apparently a reference to his stature in
his family and the community.
Accordingly, the district court did not plainly err in
its consideration of the § 3553(a) factors or its limited
explanation thereof.
2. Sentencing Factor Manipulation
Lucena-Rivera contends that the district court did not
adequately address or credit his allegations of sentencing factor
11
Lucena-Rivera put forth substantial evidence as to his
personal history and characteristics as a loving son, brother,
husband, and father that may have warranted a downward departure
from the Guideline range. See 18 U.S.C. § 3553(a)(1) (instructing
that a sentence should reflect "the nature and circumstances of the
offense and the history and characteristics of the defendant").
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manipulation.12 Sentencing factor manipulation occurs "'where
government agents have improperly enlarged the scope or scale of
[a] crime.'" United States v. Fontes, 415 F.3d 174, 180 (1st Cir.
2005) (alteration in original) (quoting United States v. Montoya,
62 F.3d 1, 3 (1st Cir. 1995)). We have recognized that because
"'[b]y definition, there is an element of manipulation in any sting
operation,' . . . relief for sentencing factor manipulation is
reserved for only 'the extreme and unusual case.'" Fontes, 415
F.3d at 180 (first alteration in original) (quoting United States
v. Connell, 960 F.2d 191, 194 (1st Cir. 1992) and Montoya, 62 F.3d
at 4). The defendant bears the burden of establishing sentencing
factor manipulation by a preponderance of the evidence, United
States v. Gibbens, 25 F.3d 28, 31-32 (1st Cir. 1994), and a
district judge's "determination as to whether improper manipulation
exists is ordinarily a factbound determination subject to
clear-error review." Id. at 30.
Here, Lucena-Rivera argues that the government possessed
enough information and evidence to prosecute him as of September 2,
2010, yet continued to launder money and import drugs with him
until August 2011. Lucena-Rivera maintains that the government's
motivation for continuing this criminal activity was to inflate his
12
The district court briefly remarked before imposing the
sentence, "I don't find the evidence, I don't find anything in this
record that allows me to conclude that there was manipulation in
this case as described by the case law, First Circuit case law."
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eventual sentence. See United States v. Egemonye, 62 F.3d 425, 428
(1st Cir. 1995) (noting that a government sting operation "could
not be endlessly prolonged and enlarged," but finding no
"'extraordinary misconduct'" there).
Although the investigation was prolonged beyond the
initial money-laundering transaction, Lucena-Rivera has not
sustained his burden of demonstrating an improper motive for this
prolongation. On the contrary, the limited record on this issue
suggests proper motives. As noted at the outset, one of Lucena-
Rivera's associates (Torres-Vázquez) was indicted and convicted on
the basis of, in part, information and evidence obtained during the
later transactions between himself, Lucena-Rivera, and the
confidential informant. See United States v. Torres-Vázquez, 731
F.3d 41, 45-46 (1st Cir. 2013); see also United States v. Barbour,
393 F.3d 82, 87 (1st Cir. 2004) (noting that a proper motive for
prolonging an investigation would be "to identify more of the
conspirators and gather evidence against them"). Furthermore, the
government was investigating Lucena-Rivera for drug crimes at the
time, not simply money-laundering, and law enforcement authorities
may not have completed their investigation of those crimes.
Although more explanation from the district court would
have aided our review, it invoked generally First Circuit case law
in stating its conclusion that Lucena-Rivera failed to demonstrate
that the government was motivated by an improper goal rather than
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a legitimate one. On this record, that determination was not
clearly erroneous. See Barbour, 393 F.3d at 87 ("A district court's
choice between two or more reasonable interpretations of the
evidence cannot be called clearly erroneous.").
III.
For the reasons set forth in Part II.C above, we remand
the case to the district court for proceedings consistent with this
opinion. We retain jurisdiction for the time being pending the
district court's election as to whether to file additional written
findings as described in this opinion or, alternatively, to vacate
the sentence. So ordered.
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