United States v. Jeffrey Weaver , 716 F.3d 439 ( 2013 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 12-3324
U NITED S TATES OF A MERICA,
Plaintiff-Appellee,
v.
JEFFREY W EAVER,
Defendant-Appellant.
Appeal from the United States District Court
for the Southern District of Indiana, Indianapolis Division.
No. 1:11CR00153-001—William T. Lawrence, Judge.
A RGUED A PRIL 30, 2013—D ECIDED JUNE 3, 2013
Before F LAUM, W OOD and H AMILTON, Circuit Judges.
F LAUM, Circuit Judge. Jeffrey Weaver sold methamphet-
amine on credit to two buyers, who paid off their debts
by selling the drugs to their own customers. (In trade
parlance, this is known as “fronting” the drugs.) Weaver
pleaded guilty to conspiring with those buyers to
possess and distribute methamphetamine, see 21 U.S.C.
§§ 841(a)(1), 846, and the district court sentenced him to
235 months’ imprisonment, the bottom of the guidelines
2 No. 12-3324
range calculated by the court. On appeal Weaver
argues that the court overstated that range by assessing
a 3-level upward adjustment for his perceived leader-
ship role as a manager or supervisor of the conspiracy.
See U.S.S.G. § 3B1.1(b). But there is no evidence that
Weaver managed or supervised his buyers or any
other participant, and thus we vacate the sentence
and remand for resentencing.
While investigating a methamphetamine conspiracy
operating in Indianapolis, the FBI learned that Weaver
had been supplying Gregory Wilkey and Sysine Dale
with two ounces of the drug, two or three times a
week. Wilkey and Dale, with help from Wilkey’s girl-
friend and Dale’s boyfriend, resold the methamphet-
amine from their homes. Weaver, Wilkey, Dale, the girl-
friend and boyfriend, and two of Wilkey’s and Dale’s
customers were charged in August 2011 with conspiracy.
Weaver pleaded guilty without a plea agreement.
The probation officer’s factual summary, which neither
party disputed, sheds light on Weaver’s role. That sum-
mary, in the presentence report, does not say how
Weaver obtained the methamphetamine he fronted to
Wilkey and Dale, who in turn sold the drugs and set-
tled up with Weaver at the rate of $1,700 per ounce.
According to the probation officer, Weaver “controlled
how much and how often” Wilkey and Dale “would
receive methamphetamine” and “instructed them to
promptly sell it so he could distribute more to them.” And
at times, the summary continues, Weaver “would pres-
sure” Wilkey and Dale to make sales. As an “example” of
No. 12-3324 3
this “pressure,” the probation officer cited a single text
message that Weaver had sent Wilkey. Weaver’s message,
which reads, “Whats up man just givin u a pep talk
‘get r done’ and hit me up,” prompted Wilkey to send
a text message to one of his own customers saying,
“How quick can you get rid of ahalf no bull [expletive]
oboys riding my [expletive] on this one.” The probation
officer’s summary also characterizes Weaver as cau-
tious about delivering methamphetamine and notes that
he always arrived at a rendezvous without the meth-
amphetamine and went back for it only after deciding
that everything was “all right.” Apparently these facts
led the probation officer to recommend (without explana-
tion) a 4-level upward adjustment under U.S.S.G.
§ 3B1.1(a), which applies to a defendant who was “an
organizer or leader of a criminal activity that involved
five or more participants or was otherwise extensive.”
Weaver objected to the proposed increase, and at sen-
tencing a detective who investigated the conspiracy
testified about Weaver’s role. The detective explained
that Weaver had offered to supply Wilkey with meth-
amphetamine after learning that Wilkey was dissatis-
fied with his current source. The detective described
Weaver’s role as “setting the speed” of the distribu-
tion by often declining to supply Wilkey and Dale with
methamphetamine at the precise times they wanted it,
setting deliveries on short notice, and often showing
up late for meetings. Moreover, Weaver refused to
deliver drugs anywhere but at Wilkey’s and Dale’s
homes or to deliver more than two ounces at a time.
Yet on cross-examination the detective conceded that
4 No. 12-3324
Weaver did not control to whom or at what price
Wilkey and Dale sold the drugs Weaver fronted.
The district court declined to apply a 4-level increase
but did assess 3 levels under § 3B1.1(b), which applies
to a defendant who was “a manager or supervisor (but
not an organizer or leader) and the criminal activity
involved five or more participants or was otherwise
extensive.” The judge explained his decision:
Here I find that he clearly did exercise decision-
making authority with respect to the activity of
the conspiracy. He determined how much and
how often Mr. Wilkey and Ms. Dale would receive
methamphetamine, regardless of whether they
needed it quicker than he was willing to provide.
In fact, he often gave them just minutes notice of
the dropoff at their residences.
In addition, his participation in planning and organ-
izing was extensive. He was always, as stated by
the confidential informant, at the residence where
the transactions took place early on. He was also
careful in planning the delivery of meth. He would
repeatedly arrive at a location without the metham-
phetamine to make sure everything seemed all
right. Then he would leave and return with the meth.
It appears that his participation was somewhat ex-
tensive. He had been distributing to [Wilkey] for
two years and to Dale since May of 2011.
It’s also apparent he exercised a degree of control
over the other participants in the criminal activity.
No. 12-3324 5
He directed Wilkey to ensure the timely return of
drug proceeds, and he pressured Wilkey and Dale
to sell the methamphetamine promptly.
Mr. Wilkey’s text message is another example of
the control he exerted. In a text to one of these cus-
tomers, Mr. Wilkey wrote that you, Weaver, were
putting pressure on him; and he expressed a desire
to sell the meth quickly due to the pressure he was
feeling from Mr. Weaver.
I find and I agree with the argument, Mr. Baldwin
[defense counsel] that it appears that he did not
necessarily determine the price.
He was not engaged actively in the recruitment of
other distributors . . . .
I do believe that the enhancement is appropriate in
this case. I am reluctant, however, to find that
Mr. Weaver was a leader or organizer. I feel that
more appropriately, he was a manager or supervisor.
The court calculated a total offense level of 38, which,
combined with Weaver’s criminal history category of I,
yielded an imprisonment range of 235 to 293 months.
The court selected 235 months, well above the 10-year
statutory minimum. See 21 U.S.C. § 841(b)(1)(A)(viii).
A defendant who is an organizer or leader of a
criminal activity involving five or more participants gets
a 4-level upward adjustment; a manager or supervisor
receives a 3-level increase. U.S.S.G. § 3B1.1(a), (b). At
the crux of this distinction and at the base of the
rationale for this enhancement sits the relative culp-
6 No. 12-3324
ability of each participant in the criminal enterprise:
those who are more culpable ought to receive the
harsher organizer/leader enhancement, while those with
lesser culpability and responsibility receive the lesser
enhancement imposed on managers/supervisors. See
United States v. Reynolds, No. 12-1206, 2013 WL 1891294,
at *3 (7th Cir. May 8, 2013) (citing United States v.
Mendoza, 576 F.3d 711, 717 (7th Cir. 2009)). And those with
the least relative culpability receive no enhancement at
all.1 As United States v. Graham explained, Ҥ 3B1.1 . . .
creates three relevant tiers for conspiracies that are ‘ex-
tensive’: a tier for leaders and organizers, a tier for man-
agers and supervisors, and a tier for everyone else.” 162
F.3d 1180, 1185 (D.C. Cir. 1998); see also United States v.
Albers, 93 F.3d 1469, 1488 (10th Cir. 1996) (“[T]he grava-
men of [Guideline 3B1.1] is control, organization, and
responsibility for the actions of others[.]”). In short, rela-
tive culpability is a “central concern” of Guideline 3B1.1.
Mendoza, 576 F.3d at 717. Weaver does not dispute that
the conspiracy involved five or more participants. But
he does argue that he was not a manager or supervisor.
The Guidelines do not define “organizer,” “leader,”
“manager,” or “supervisor.” Application Note 4 does,
however, list the factors courts should consider in distin-
1
Likewise, because Guideline 3B1.1 is all about the culpa-
bility of one participant in the criminal enterprise relative to
the culpability of other participants in the scheme, if all partici-
pants in the criminal enterprise are equally culpable, none
receive the enhancement. See United States v. Mustread, 42
F.3d 1097, 1103 (7th Cir. 1994).
No. 12-3324 7
guishing between an organizer/leader on the one hand
and a manager/supervisor on the other.2 See United States
v. Figueroa, 682 F.3d 694, 697 (7th Cir. 2012). Although
Note 4 offered these factors to distinguish between or-
ganizers/leaders and managers/supervisors, we have,
in the past, consulted these factors to decide whether
Guideline 3B1.1 applies in the first place. Thus, we
have used the factors to distinguish between low-level
participants undeserving of any enhancement whatso-
ever and managers/supervisors worthy of the 3-level
enhancement. See United States v. Howell, 527 F.3d 646,
649 (7th Cir. 2008); United States v. Mustread, 42 F.3d
1097, 1104 (7th Cir. 1994).
United States v. Figueroa found resort to these factors
unnecessary: “If a judge, a probation officer, a lawyer,
even a defendant, doesn’t know what a ‘manager’ or
‘supervisor’ is, Application Note 4 isn’t going to help
him—especially since it’s about organizers and leaders
and not middle managers and low-level supervisors[.]”
682 F.3d at 697. Thus, more recently, we have said that
“a manager or supervisor should be straightforwardly
understood as simply someone who helps manage or
supervise a criminal scheme.” United States v. Grigsby,
2
The seven factors are: (1) the exercise of decision-making
authority; (2) the nature of participation in the commission of
the offense; (3) the recruitment of accomplices; (4) the claimed
right to a larger share of the fruits of the crime; (5) the degree
of participation in planning or organizing the offense; (6) the
nature and scope of the illegal activity; and (7) the degree
of control or authority exercised over others.
8 No. 12-3324
692 F.3d 778, 790 (7th Cir. 2012); see United States v. Collins,
___ F.3d ___, 2013 WL 1979129, at *6 (7th Cir. May 15,
2013); United States v. Bennett, 708 F.3d 879, 892 (7th Cir.
2013); Figueroa, 682 F.3d at 697 (finding no need “to
worry, . . . whether a defendant given [the manager/
supervisor] enhancement . . . ‘exercised some control over
others’ or alternatively ‘played a coordinating or organiz-
ing role.’ ”). That does not mean, however, that the factors
in Application Note 4 are not instructive. To the extent
those factors help to “straightforwardly” identify whether
a defendant “helps manage or supervise a criminal
scheme,” courts may continue to consider them. Applica-
tion Note 4 simply recognizes that organizers/leaders
will exhibit more of those factors and to a greater degree
than a lower-level manager/supervisor. And although
it does not label the factors irrelevant to the man-
ager/supervisor decision, neither does § 3B1.1 require
the presence of any one of the factors as a prerequisite
to imposing the manager/supervisor enhancement. See
Bennett, 708 F.3d at 891; Figueroa, 682 F.3d at 697;
Mustread, 42 F.3d at 1104 n.3 (finding “slavish adher-
ence to [the Application Note 4 factors] unnecessary:
the ultimate question is what relative role the defendant
played”).
So was Weaver a manager or supervisor? In advancing
that he was, the government relies heavily on the sug-
gestion that Weaver exercised decision-making au-
thority and control over Wilkey and Dale by dictating
when, how often, and how much methamphetamine
Wilkey and Dale would receive. See United States v.
Slade, 631 F.3d 185, 190 (4th Cir. 2011) (applying man-
ager/supervisor enhancement when defendant “con-
No. 12-3324 9
trolled the activities of other participants”). In evalu-
ating whether a defendant’s control and authority over
others merits the 3-level manager/supervisor enhance-
ment, district courts should make a commonsense judg-
ment about the defendant’s relative culpability given
his status in the criminal hierarchy. See Graham, 162
F.3d at 1185 (“When confronted with a heavily stratified
conspiracy, a court must superimpose the [three-tiered]
§ 3B1.1 framework over the organizational chart of the
conspiracy and, using the factors noted above, decide
where to draw the two relevant lines that determine
who qualifies for a § 3B1.1 enhancement.”).
For purposes of § 3B1.1 then, a defendant exercises
control and authority over another when he “tells people
what to do and determines whether they’ve done it.”
Figueroa, 682 F.3d at 697; accord United States v. Richards, 198
F.3d 1029, 1034 (7th Cir. 2000) (finding “at least indirect
control over [others] . . . as they did what [defendant]
wanted, when [defendant] wanted it and where [defen-
dant] wanted it done”); United States v. Roberts, 14 F.3d
502, 523 (10th Cir. 1993) (refusing to apply enhancement
in the absence of “evidence of decision-making authority
or control over a subordinate”). This exercise of control
and authority will usually allow the defendant to
impose some sanction, reward, or punishment for the
underling’s execution of the directed task. Thus, the
ability to coerce underlings is a key indicator of control
or authority suggestive of managerial or supervisory
responsibility in the criminal enterprise. See Bennett,
708 F.3d at 892 (“Although most supervisors do not
terrorize their subordinates (at least not physically),
10 No. 12-3324
administering sanctions for poor work quality is a quin-
tessential supervisory task.”). Moreover, the importance
of coercion suggests that an underling’s independence
from the defendant can undermine the government’s
suggestion of control. See Mustread, 42 F.3d at 1105 (“But
Figueroa was one of Mustread’s independent suppliers
and co-conspirators; he was never at [the defendant’s]
beck and call.”). Thus, while all participants in the
criminal activity need not be members of the same
street gang, crew, or formally organized criminal enter-
prise, some hierarchy among those involved in the
criminal activity must exist to qualify a defendant for an
enhancement under § 3B1.1. Finally, the enhancement
requires ongoing supervision, not a one-off request from
one equal to another during the course of the criminal
activity. Figueroa, 682 F.3d at 697-98 (“Because to be
a ‘manager’ or ‘supervisor’ is to occupy a role—to have a
status—cases distinguish between ongoing supervision
and merely asking a coconspirator on one occasion to
do something.” (citations omitted)).
Weaver provided insufficient ongoing supervision and
coercive authority to warrant the enhancement. He
simply fronted methamphetamine to Wilkey and Dale,
urging them to sell it quickly and pay him. Yet
“[s]upplying drugs and negotiating the terms of their
sale do not by themselves justify a Section 3B1.1 increase,
for these things do not indicate that the person who
does them has a greater degree of responsibility for
putting together the drug operation or a particular
deal than anyone else involved, including the customer.”
United States v. Vargas, 16 F.3d 155, 160 (7th Cir. 1994);
No. 12-3324 11
see also United States v. Pagan, 196 F.3d 884, 892 (7th Cir.
1999); Mustread, 42 F.3d at 1104; United States v. Brown,
944 F.2d 1377, 1381 (7th Cir. 1991); United States v. Thomp-
son, 944 F.2d 1331, 1349 (7th Cir. 1991). Indeed, a borrower
would not describe her loan officer as her “manager” or
“supervisor” simply because the loan officer imposes
a credit limit, dictates the interest rate and loan term,
advertises for customers, and refuses to be available on
weekends. In this sense, Weaver was no different than
any other business that extends credit to customers:
he encouraged behavior that would protect his invest-
ment and insure payment of the debt owed to him.
The district court deemed it significant that Weaver
was cautious and budged little on matters such as
price, delivery point, and quantity. Indeed, Weaver
sometimes kept his customers waiting and even decided
at times not to honor their requests for specific delivery
times. But none of that makes him a manager or super-
visor of his customers. He did not tell Wilkey or Dale
what price they had to charge their customers, or impose
territorial limits on their sales, or set distribution quotas.
And presumably, if Wilkey and Dale did not resell the
product or sold it at a loss, they would nevertheless
remain indebted to Weaver at $1,700 per ounce. A
manager or supervisor in a drug dealing enterprise
(though he may surely mete out some punishment for
the low-level dealers who performed inadequately)
would have to eat that loss just as a retail store manager
would assume the loss arising from the poor per-
formance of a floor salesman. The best that can be said
for applying the increase is that Weaver generally
12 No. 12-3324
pushed his wares aggressively and demanded prompt
payment, though sometimes would get low marks for
customer service. Weaver’s interest in a quick turn-
around, however, doesn’t make Wilkey or Dale his under-
lings; as the probation officer appeared to understand,
Weaver simply “instructed them to promptly sell” the
methamphetamine “so he could distribute more to
them.” Trying to sell more while getting paid is what
merchants—not necessarily managers and supervi-
sors—do. See Vargas, 16 F.3d at 160; Pagan, 196 F.3d at
893; Mustread, 42 F.3d at 1104-05; United States v. Sayles,
296 F.3d 219, 225 (4th Cir. 2002); United States v. Medina,
167 F.3d 77, 81 n.4 (1st Cir. 1999); United States v. Toro-
Aguilera, 138 F.3d 340, 343 (8th Cir. 1998).
For these same reasons, neither does the govern-
ment’s suggestion that Weaver recruited Wilkey into
the conspiracy warrant application of the enhancement.
The evidence suggests only that Weaver and his co-con-
spirators had nothing more than a merchant-customer
relationship. All Weaver did through Wilkey’s inclu-
sion was solicit a new customer for his own wholesale
drug dealing. Weaver did not stratify his drug organiza-
tion by “hiring” Wilkey as an underling over whom
Weaver exercised managerial or supervisory control.
In the end, the government did not offer any
evidence that Weaver assumed quintessential managerial
or supervisory tasks of the type we have concluded
warrant an increase. See Bennett, 708 F.3d at 892 (adminis-
tering sanctions for poor performance); Grigsby, 692 F.3d
at 791 (supervising a bank robbery from outside the
No. 12-3324 13
bank); Figueroa, 682 F.3d at 697 (“tell[ing] people what
to do and determin[ing] whether they’ve done it”).
For these reasons, we V ACATE the judgment and
R EMAND the case for resentencing.
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