United States v. Todd Warthen , 390 F. App'x 977 ( 2010 )

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
No. 10-10093 ELEVENTH CIRCUIT
Non-Argument Calendar AUGUST 6, 2010
________________________ JOHN LEY
CLERK
D.C. Docket No. 4:09-cr-00021-RH-WCS-4
UNITED STATES OF AMERICA,
lllllllllllllllllllll Plaintiff-Appellee,
versus
TODD WARTHEN,
lllllllllllllllllllll Defendant-Appellant.
________________________
Appeal from the United States District Court
for the Northern District of Florida
________________________
(August 6, 2010)
Before CARNES, HULL and MARCUS, Circuit Judges.
PER CURIAM:
After pleading guilty, Defendant Todd Warthen appeals his 21-month
sentence for conspiracy to commit fraud in connection with counterfeit access
devices and fraud in connection with counterfeit access devices, in violation of 18
U.S.C. §§ 371, 1029(a)(1), (b)(2), and (c) and 2. After review, we affirm.
I. BACKGROUND
A. Offense Conduct
Defendant Warthen and four codefendants were involved in a scheme to use
counterfeit credit and debit cards. The counterfeit cards were made using account
information from a 2008 data breach at Heartland Payment Systems, Inc., a credit
card company. The individuals who perpetrated the breach sold the information to
buyers who used it to create counterfeit cards.
In Warthen’s case, one of his codefendants used a machine resembling a
magnetic stripe reader/writer to create counterfeit Visa gift cards, which the
codefendants then used to purchase Wal-Mart gift cards. Using the Wal-Mart gift
cards, the codefendants bought electronics and resold them for a profit.
Codefendant Jeremy Frazier organized the scheme and admitted providing
the counterfeit credit and gift cards. Frazier stated that Defendant Warthen and the
other three codefendants took orders for specific items and shopped for them at
Wal-Mart, giving Frazier a 25% cut from the sales.
Investigators obtained Wal-Mart surveillance videos showing Defendant
Warthen and his codefendants making numerous purchases of Wal-Mart gift cards
2
with what appeared to be Visa gift cards. They then purchased items such as
iPods, X-Boxes, Sony Play Stations and flat screen televisions.
B. Presentence Investigation Report
Codefendant Frazier’s overall conspiracy involved $320,640.80 in
attempted losses. However, in calculating Defendant Warthen’s advisory
guidelines range, the Presentence Investigation Report (“PSI”) held Warthen
accountable for only $45,744.06 in losses based on the transactions Warthen
completed himself or that Warthen participated in. An appendix to the PSI listed:
(1) each of Warthen’s transactions by date, card number and victim bank; (2) who,
if anyone, accompanied Warthen; (3) whether the attempt was successful (in
which case the loss was also calculated as restitution) or unsuccessful; and (4) the
amount of intended loss.1
The PSI set Warthen’s base offense level at 6, pursuant to U.S.S.G.
§ 2B1.1(a)(2), and then increased it by 6 levels, pursuant to § 2B1.1(b)(1)(D),
because the loss was more than $30,000. The PSI applied a 2-level increase,
1
The loss amount under § 2B1.1(b)(1) is the greater of the intended loss and the actual
loss. U.S.S.G. § 2B1.1 cmt. n.3(A). Intended loss is defined as “the pecuniary harm that was
intended to result from the offense” even if it “would have been impossible or unlikely to occur.”
U.S.S.G. § 2B1.1 cmt. n.3(A)(ii). The PSI used the intended loss amount of $45,744.06 rather
than the actual loss amount of $16,434.98. The PSI arrived at the $45,744.06 amount using a
minimum of $500 for each transaction. See U.S.S.G. § 2B1.1 cmt. n.3(F)(i) (providing that in
cases involving counterfeit and unauthorized access devices, loss “shall not be less than $500 per
access device”).
3
pursuant to § 2B1.1(b)(10)(A)(i) and (B)(i), because the offenses involved the
possession or use of device-making equipment (the “encoder” used to make the
counterfeit cards) and the production of an unauthorized or counterfeit access
device (the “debit/credit/gift cards”). The PSI added 2 levels, pursuant to
§ 2B1.1(b)(2), because the offenses involved at least ten victims, and 2 levels,
pursuant to § 2B1.1(b)(9), because the offenses used sophisticated means and were
perpetrated in multiple jurisdictions to evade law enforcement (Wal-Marts
throughout Florida). With a total offense level of 18 and a criminal history
category of I, the PSI recommended an advisory guidelines range of 27 to 33
months’ imprisonment.
Warthen objected to the PSI’s (1) loss calculation, arguing that he
participated in only two transactions, and (2) the sophisticated-means
enhancement. Warthen also contended he should receive a 4-level minimal-role
reduction and a 2-level reduction for acceptance of responsibility.
C. Sentencing Hearing
At the sentencing hearing, the government’s witness was Emily Beyer, a
special agent with the U.S. Secret Service, who investigated the counterfeit card
scheme. Agent Beyer gathered transactional data, journal records and Wal-Mart’s
video surveillance to identify each codefendant engaged in individual transactions
4
at the register. Using this information, Agent Beyer created a spreadsheet
detailing each codefendant’s participation.
As to Defendant Warthen, Agent Beyer listed only those transactions for
which surveillance videotapes showed Warthen conducting the transaction or
assisting in conducting the transaction. The probation office used Agent Beyer’s
spreadsheet to prepare Warthen’s PSI and the appendix listing the transactions for
which he was accountable. Agent Beyer stated that Warthen’s role in the scheme
was to use the counterfeit credit cards and the Wal-Mart gift cards to buy
merchandise and that she had no evidence that he was involved in obtaining the
stolen account information, wiring money or selling the Wal-Mart merchandise.
Rather, codefendant Frazier purchased the stolen account numbers and possessed
the magnetic stripe machine used to encode the stolen account numbers on the
counterfeit cards.
The district court overruled Warthen’s objections to the sophisticated means
enhancement and the loss calculation. As to the loss calculation, the district court
found that Agent Beyer’s methodology for attributing losses to each defendant
was appropriate. The district court found that each defendant was held
accountable for only those transactions for which video surveillance demonstrated
the defendant’s presence. The district court also overruled the objection to the
5
sophisticated means enhancement.
The district court denied Warthen’s request for the minimal-role reduction.
Noting that the proper focus was on the defendant’s role in the transactions for
which he was held accountable, not the entire scheme, the district court concluded
that “the person who is there and participates in the transaction does not have a
minor role in that transaction.” The district court granted Warthen’s request for a
2-level reduction for acceptance of responsibility.
With a total offense level of 16 and a criminal history category of I,
Warthen’s advisory guidelines range was 21 to 27 months’ imprisonment.
The district court imposed a 21-month sentence. Warthen filed this appeal.
II. DISCUSSION
On appeal, Warthen argues that the district court clearly erred in denying his
request for a 4-level minimal-role reduction, pursuant to U.S.S.G. § 3B1.2.
Although the Sentencing Guidelines are advisory after United States v. Booker,
543 U.S. 220, 125 S. Ct. 738 (2005), the district court must still correctly calculate
the advisory guidelines range. United States v. Pugh, 515 F.3d 1179, 1190 (11th
Cir. 2008). The guidelines provide for a reduction of 2 to 4 offense levels based
on the defendant’s mitigating role in the offense. U.S.S.G. § 3B1.2. A defendant
who is a “minor participant” in the criminal activity is entitled to a 2-level
6
reduction. U.S.S.G. § 3B1.2(b). A minor participant is one “who is less culpable
than most other participants, but whose role could not be described as minimal.”
U.S.S.G. § 3B1.2 cmt. n.5. A defendant who is a “minimal participant” in the
criminal activity is entitled to a 4-level reduction. U.S.S.G. § 3B1.2(a). A
minimal participant is one who is “plainly among the least culpable . . . of a
group.” U.S.S.G. § 3B1.2 cmt. n.4. The defendant has the burden to establish his
role in the offense by a preponderance of the evidence. United States v. De Varon,
175 F.3d 930, 939 (11th Cir. 1999) (en banc).2
“Two principles guide the district court’s consideration: (1) the court must
compare the defendant’s role in the offense with the relevant conduct attributed to
him in calculating his base offense level; and (2) the court may compare the
defendant’s conduct to that of other participants involved in the offense.” United
States v. Alvarez-Coria, 447 F.3d 1340, 1343 (11th Cir. 2006). When the relevant
conduct attributed to a defendant is the same as his actual conduct, “he cannot
prove that he is entitled to a minor-role adjustment simply by pointing to some
broader scheme for which he was not held accountable.” Id.; see also De Varon,
175 F.3d at 942-43 (concluding that “when a drug courier’s relevant conduct is
2
We review a district court’s denial of a mitigating-role reduction for clear error. United
States v. Bernal-Benitez, 594 F.3d 1303, 1320 (11th Cir.), cert. denied, 130 S. Ct. 2123 (2010).
7
limited to [his] own act of importation, a district court may legitimately conclude
that the courier played an important or essential role in the importation of those
drugs”). “Relevant conduct” includes the defendant’s own acts and omissions
and, in the case of a jointly undertaken criminal activity, the reasonably
foreseeable acts and omissions of others in furtherance of the jointly undertaken
criminal activity. U.S.S.G. § 1B1.3(a)(1).
As to the second prong, the district court is permitted to “measure the
defendant’s conduct against that of other participants” but only “where the record
evidence is sufficient.” De Varon, 175 F.3d at 934. Furthermore, “[t]he fact that a
defendant’s role may be less than that of other participants engaged in the relevant
conduct may not be dispositive of role in the offense, since it is possible that none
are minor or minimal participants.” Id. at 944.
On the record before us, we cannot say the district court’s refusal to give
Warthen a 4-level minimal-role reduction was clear error. In calculating
Warthen’s offense level, the district court held Warthen accountable for the losses
connected only to the Wal-Mart transactions he actually engaged in. Warthen was
not held accountable for Frazier’s overall scheme or in his codefendants’
transactions in which he played no part.
Warthen points out that, as relevant conduct, he was held accountable for
8
his codefendant Frazier’s possession and use of the magnetic stripe machine to
encode the counterfeit Visa credit cards. This enhancement added 2 levels to the
12-level offense level calculated based solely on his own conduct. See U.S.S.G.
§ 2B1.1(b)(10)(A)(i).3 Warthen however ignores the fact that he himself used the
encoded Visa credit cards to purchase the Wal-Mart gift cards, which connects his
criminal conduct to some extent to that machine. Even assuming Warthen’s actual
conduct and his relevant conduct may not be identical, they are inextricably tied
together. This is also not a case in which the relevant conduct is much broader
than the actual conduct. Warthen has not carried his burden to show he was
“plainly among the least culpable” with regard to the counterfeiting scheme.
This is particularly true when we compare Defendant Warthen’s role in the
transactions attributed to him to that of his codefendants. Although Warthen may
have been less culpable than Frazier, who organized the scheme and provided him
with the encoded counterfeit Visa gift cards, Warthen was as culpable as the other
codefendants, who engaged in the same conduct he did, accompanied him to Wal-
3
We reject Warthen’s argument that his loss calculation of $45,744.06 under U.S.S.G.
§ 2B1.1(b)(1)(D) included loss amounts beyond his actual conduct. The Commentary to § 2B1.1
provides that “[i]n a case involving any counterfeit access device . . ., loss includes any
unauthorized charges made with the counterfeit access device . . . and shall not be less than $500
per access device.” U.S.S.G. § 2B1.1 cmt. n.3(F)(i). Thus, the PSI’s use of the $500 minimum
for each Visa gift card transaction Warthen made at Wal-Mart reflected Warthen’s actual
conduct, not the conduct of his codefendants imputed to him as relevant conduct.
9
Mart and participated in the counterfeit gift card transactions.
We also agree with the district court that Warthen did not play a mitigating
role in his own Wal-Mart transactions. Although Warthen personally did not use
the magnetic stripe machine to produce the counterfeit cards, he used those
encoded cards in his own transactions. Warthen played an important, rather than
minimal, role in those transactions.
Warthen also complains that the district court did not reach the second
prong of the De Varon analysis and compare his conduct with that of his
codefendants. Nothing in De Varon requires the district court to reach the second
prong of the analysis. See De Varon, 175 F.3d at 934. Indeed, De Varon
recognizes that “in many cases” the first prong “will be dispositive.” Id. at 945.
In any event, “[i]n making the ultimate determination of the defendant’s role in the
offense, the sentencing judge has no duty to make any specific subsidiary factual
findings.” Id. at 939. Rather, “[s]o long as the district court’s decision is
supported by the record and the court clearly resolves any disputed factual issues,
a simple statement of the district court’s conclusion is sufficient.” Id. Here, the
district court clearly stated that Warthen’s role in the offense did not warrant a
mitigating-role reduction, and we agree.
AFFIRMED.
10