United States v. Steven Vargem , 747 F.3d 724 ( 2014 )

FILED
FOR PUBLICATION MAR 28 2014
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, : No. 12-10628
:
Plaintiff-Appellee, : D.C. No. 5:10-cr-00729-EKD-1
:
v. : OPINION
:
STEVEN LEE VARGEM :
:
Defendant-Appellant. :
Appeal from the United States District Court
for the Northen District of California
Edward J. Davila, Presiding
Argued and Submitted February 11, 2014
San Francisco, California
Before: REINHARDT and THOMAS, Circuit Judges, and SESSIONS, District Judge.*
SESSIONS, District Judge:
Steven Lee Vargem was convicted of possessing an unregistered machine gun and
sentenced to 30 months in prison.1 On appeal, the government concedes that the district
court miscalculated Vargem’s base offense level under the United States Sentencing
Guidelines (“Guidelines”). We hold that the district court also erred in applying a six-
level enhancement on the basis of other weapons found at Vargem’s home. We therefore
*
The Honorable William K. Sessions III, District Judge for the U.S. District Court
for the District of Vermont, sitting by designation.
1
Vargem appealed both his conviction and sentence. In a separate unpublished
memorandum disposition filed concurrently with this opinion, we affirm the conviction.
vacate and remand for resentencing.
BACKGROUND
On June 19, 2010, San Jose police responded to a domestic assault call at the
Vargem residence. When the officers arrived, Vargem’s wife Lynda reported that her
husband had physically assaulted her. Vargem was no longer at the house. The police
subsequently contacted a Santa Clara County judicial officer and obtained an emergency
protective order (“EPRO”) on Lynda’s behalf. The EPRO, valid through June 25, 2010,
stated that Vargem must not “contact, molest, harass, attack, strike, [or] threaten” his
wife, and ordered him to stay at least 300 yards away from his residence. The EPRO
further stated that persons subject to a restraining order are prohibited from owning,
possessing, purchasing, receiving, or attempting to purchase or receive a firearm.
San Jose police officer Duane Tuell was assigned to investigate the incident.
Officer Tuell reviewed a law enforcement database and discovered that Vargem had
twelve firearms registered in his name. On June 24, 2010, Officer Tuell contacted Lynda
about the firearms, and learned that they were in safes to which she did not have access.
Lynda also told Officer Tuell that she had seen her husband put a pistol into a gun safe
approximately two months prior to the assault. In a subsequent conversation that same
day, Lynda described for Officer Tuell the vehicles to which her husband might have
access, including a white van registered to his business.
Officer Tuell then telephoned Vargem to ask about the firearms. He identified
himself as a police officer, and told Vargem that pursuant to the EPRO all firearms must
2
be surrendered. Vargem acknowledged that he was aware of the EPRO, and stated that
he did not know what weapons were in the house. When Officer Tuell asked for consent
to search three safes in the house, Vargem replied that he wished to discuss the request
with his lawyer. Officer Tuell informed Vargem that absent consent he would obtain a
search warrant, at which point Vargem asked if he could call right back. Officer Tuell
agreed, but Vargem did not call back.
After not hearing from Vargem, Officer Tuell sent a patrol unit to the Vargem
residence. When the officers arrived, they saw a white van registered to Vargem parked
in the driveway, and Vargem loading unknown items into the van. They waited for him
to drive away from the residence and conducted a vehicle stop a few blocks away. The
officers arrested Vargem for violating the EPRO, searched the van, and discovered an
unloaded pistol.
Officer Tuell then obtained a warrant to search the home. The search revealed 28
firearms.2 One of the firearms was an unregistered machine gun. Vargem later admitted
that he owned the gun, and that he had converted it from a semi-automatic pistol to a
machine gun. He was ultimately indicted for unlawful possession of a machine gun in
violation of 18 U.S.C. §§ 922(o) and 924(a)(2), and unlawful possession of an
unregistered firearm in violation of 26 U.S.C. §§ 5841, 5861(d), and 5871. Both counts
2
This figure includes the gun found in the van, as it was listed on the search warrant
return. Because the parties consistently refer to each of the 28 firearms as having been found at
the home, and since the distinction between the van and the house is of no import to our analysis,
the Court will do the same.
3
were predicated upon the same weapon, and no charges were brought with respect to any
of the remaining guns.
Vargem waived his right to a jury trial and agreed to a stipulated-testimony bench
trial. The district court convicted him of the two charged counts. At sentencing, and
based upon the recommendations set forth in the Pre-Sentence Investigation Report
(“PSR”), the court found a base offense level of 20 for possession of a machine gun by a
prohibited person. U.S.S.G. § 2D2.1(a)(4)(B). The court also applied a six-level
enhancement for multiple firearms, based upon the 28 firearms found in Vargem’s home,
under § 2K2.1(b)(1)(C). With a criminal history category II, the resulting Guideline
range was 70 to 87 months. Defense counsel argued for a 21-month sentence, the
government for 77 months. The court considered sentencing factors under 18 U.S.C. §
3553 and imposed a 30-month sentence. According to Vargem’s current counsel,
Vargem’s projected release date is August 12, 2014.
DISCUSSION
I. The District Court’s Calculation of Vargem’s Base Offense Level Constituted
Plain Error
The district court applied a base offense level of 20 pursuant to U.S.S.G. §
2K2.1(a)(4). Because Vargem did not contest his base offense level at sentencing, the
Court reviews the district court’s determination for plain error. See United States v.
Guzman–Mata, 579 F.3d 1065, 1068 (9th Cir. 2009).
Section 2K2.1(a)(4)(B) pertains, in relevant part, to persons convicted of
4
possessing a machine gun or other firearm who were also prohibited persons under 18
U.S.C. § 922(g)(8).3 See U.S.S.G. § 2K2.1, Application Note 3. Section 922(g)(8)(A)
covers persons subject to restraining orders, but only when such orders were issued after
notice and a hearing. See 18 U.S.C. § 922(g)(8)(A). Here, it is undisputed that the EPRO
was issued without either notice or a hearing. Accordingly, the government properly
concedes that Section 922(g)(8) did not apply, that Vargem was not a prohibited person
under § 2K2.1, and the base offense level should have been 18 pursuant to § 2K2.1(a)(5).
The government does not concede, however, that resentencing is required.
Because Vargem received a sentence well below his calculated Guidelines range, the
government contends that a two-point correction in the base offense level would not
affect his substantial rights. Under the plain error standard, relief is warranted where the
district court committed (1) error that (2) is plain; (3) “affected substantial rights;” and (4)
“seriously affected the fairness, integrity, or public reputation of judicial proceedings.”
United States v. Teague, 722 F.3d 1187, 1190 (9th Cir. 2013). The government concedes
only the first two elements.
To show an error affecting substantial rights, Vargem must “demonstrate ‘a
3
The Guidelines state that “[t]he court shall use the Guidelines Manual in effect
on the date that the defendant is sentenced,” § 1B1.11(a), unless use of that Manual
“would violate the ex post facto clause of the United States Constitution,” § 1B1.11(b)(1).
Because there is no ex post facto issue in this case, we use the 2012 edition of the
Guidelines Manual, which was in effect on December 3, 2012, at the time of Vargem’s
sentencing.
5
reasonable probability that [he] would have received a different sentence’ if the district
court had not erred.” United States v. Tapia, 665 F.3d 1059, 1061 (9th Cir. 2011)
(quoting United States v. Waknine, 543 F.3d 546, 554 (9th Cir. 2008)). “A ‘reasonable
probability’ is, of course, less than a certainty, or even a likelihood.” Id. (citing United
States v. Dominguez Benitez, 542 U.S. 74, 86 (2004) (Scalia, J., concurring in the
judgment) (observing that the “reasonable probability” standard is more
“defendant-friendly” than the “more likely than not” standard)). Further, the plain error
standard does not require “direct evidence of what sentence would have been imposed if
not for the district court’s error.” Id.Here, the district court calculated a Guidelines range of 70 to 87 months. A two-
level reduction would have rendered a range of 57 to 71 months. The district court
imposed a sentence below the latter range, but higher than the prison term sought by
defense counsel. In the course of the sentencing hearing, the district court considered a
host of factors pursuant to 18 U.S.C. § 3553(a), including Vargem’s limited criminal
history, his success as a businessman, and his role as a provider for his family. The court
restated the incorrect Guidelines range immediately prior to announcing Vargem’s
sentence, and declared that it would impose a discretionary downward variance.
At any sentencing, “the Guidelines are the starting point and the initial benchmark,
and are to be kept in mind throughout the process.” United States v. Carty, 520 F.3d 984,
991 (9th Cir. 2008) (internal citations and quotation marks omitted). Accordingly, the
district court’s “failure accurately to state the [correct] Guidelines range” in this case
6
“derailed the sentencing proceeding before it even began.” United States v. Doe, 705
F.3d 1134, 1154 (9th Cir. 2013). The Supreme Court has held that “improperly
calculating[] the Guidelines range” constitutes a “significant procedural error,” Gall v.
United States, 552 U.S. 38, 51 (2007), and this Court has similarly concluded that “[a]
mistake in calculating the recommended Guidelines sentencing range is a significant
procedural error that requires us to remand for resentencing.” United States v.
Munoz–Camarena, 631 F.3d 1028, 1030 (9th Cir. 2011).
While in Vargem’s case it is “difficult to discern the district court’s intentions,” we
find that a proper Guidelines calculation “could easily have . . . led the district court to
impose” a lesser sentence. United States v. Hammons, 558 F.3d 1100, 1106 (9th Cir.
2009). The district court noted Vargem’s life accomplishments as well as his failures,
and chose to depart significantly from the erroneously-calculated range. Had the district
court started with the correct Guidelines range, there is a reasonable probability that it
would have imposed a different sentence. See, e.g., United States v. Bonilla-Guizar, 729
F.3d 1179, 1188-89 (9th Cir. 2013) (holding that a two-level error in the base offense
level calculation was plain error even though the defendant’s “sentence chanced to fall
within the proper sentencing range”); Hammons, 558 F.3d at 1106 (finding plain error
where the district court’s application of an incorrect Criminal History Category may have
led to “an additional one month of imprisonment”).
“We have held that when a sentencing judge incorrectly calculates the Guidelines
range, potentially resulting in the imposition of a greater sentence, the error affects the
7
defendant’s substantial rights and ‘the fairness of the judicial proceedings.’ As this is
precisely what happened in this case, the third and fourth prongs of the plain-error test are
satisfied.” Bonilla-Guizar, 729 F.3d at 1188 (quoting United States v. Castillo–Marin,
684 F.3d 914, 927 (9th Cir. 2012)). Indeed, this Court has “regularly deemed the fourth
prong of the plain error standard to have been satisfied where, as here, the sentencing
court committed a legal error that may have increased the length of a defendant’s
sentence.” Tapia, 665 F.3d at 1063 (listing cases).
It is easy to see why prejudicial sentencing errors [satisfy the fourth
element]: such errors impose a longer sentence than might have been
imposed had the court not plainly erred. Defendants . . . may be kept in jail
for a number of years on account of a plain error by a court, rather than
because their wrongful conduct warranted that period of incarceration.
Moreover, there is little reason not to correct plain sentencing errors when
doing so is so simple a task. . . . Reversing a sentence does not require that
a defendant be released or retried, but simply allows a district court to
exercise properly its authority to impose a legally appropriate sentence.
Id. (quoting United States v. Castillo-Casiano, 198 F.3d 787, 792 (9th Cir. 1999)).
Accordingly, we find that the district court committed plain error in its miscalculation of
Vargem’s base offense level.4
II. The District Court’s Application of a Six-Level Enhancement for Ownership
of Additional Firearms Constituted Plain Error
The district court also applied a six-level, multiple-gun enhancement under
4
Our conclusion is bolstered by the additional error, discussed below, with respect
to the multiple-gun enhancement under U.S.S.G. § 2K2.1(b)(1). See Doe, 705 F.3d at
1156 (holding “that the cumulative effect of” procedural violations amounted to plain
error).
8
U.S.S.G. § 2K2.1(b)(1) based upon the 28 firearms. That enhancement was predicated
upon the PSR’s conclusions that the guns were seized “[d]uring the course of the
offense,” and that Vargem “was prohibited from possessing any firearm.” The PSR, and
subsequently the district court, did not explicitly consider whether each of the weapons
constituted “relevant conduct” under the Guidelines. See United States v. Santoro, 159
F.3d 318, 321 (7th Cir. 1998) (noting that “[w]hen a court determines the number of
firearms involved in an offense under U.S.S.G. § 2K2.1(b)(1), it looks to the relevant
conduct section of the guidelines . . . .”). Because we conclude that possession of the
remaining firearms was not “relevant conduct” in relation to Vargem’s offense of
conviction—ownership of an unregistered machine gun—we find that the six-level
enhancement was erroneous.
A. Sentencing Proceedings and Standard of Review
The Probation Officer’s analysis with respect to the multiple-gun enhancement
was as follows:
Specific Offense Characteristics: According to USSG §2K2.1(b)(1)(C), if
the offense involved 25 to 99 firearms, increase by 6-levels. During the
course of the offense, law enforcement seized 28 firearms from the
defendant’s residence. The defendant was prohibited from possessing any
firearm. Therefore, a 6-level increase is warranted.
Defense counsel’s sentencing memorandum did not contest the six-level enhancement.
Counsel did argue, however, that the court should consider Vargem’s otherwise-lawful
9
possession of firearms as favoring a downward departure under 18 U.S.C. § 3553(a)(1).5
At the sentencing hearing, defense counsel again objected to a full six-level
enhancement, urging the district court to consider mitigating factors such as: Vargem’s
lawful purchases of the firearms in question; that the firearms had never been used for
any purpose other than collection; that many of the firearms were still in their original
packaging; and that the firearms were secured in safes. The district court overruled
defense counsel’s objection. Since defense counsel did not directly contest the
applicability of the six-level enhancement, and instead argued for a departure under 18
U.S.C. § 3553(a)(1), we again review for plain error. See Guzman–Mata, 579 F.3d at
1068.
B. Relevant Conduct
Our analysis begins with the multiple-gun enhancement provision itself. Guideline
§ 2K2.1(b), entitled “Specific Offense Characteristics,” provides for offense level
increases under certain circumstances, including “[i]f the offense involved three or more
firearms.” U.S.S.G. § 2K2.1(b)(1). When “the offense” involved between three and
seven firearms, a two-level increase is warranted. Id. § 2K2.1(b)(1)(A). For an “offense”
involving between eight and 24 firearms, the Guidelines call for a four-level increase. Id.
§ 2K2.1(b)(1)(B). In this case, the district court adopted the PSR’s recommendation of a
5
Section 3553(a)(1) allows the sentencing court to consider “the nature and
circumstances of the offense and the history and characteristics of the defendant.” 18
U.S.C. § 3553(a)(1).
10
six-level increase under § 2K2.1(b)(1)(C), which applies to “offenses” involving between
25 and 99 firearms.
The Guidelines define “offense” as “the offense of conviction and all relevant
conduct under § 1B1.3.” Id. § 1B1.1, Application Note 1(H). Relevant conduct includes
“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.” Id. § 1B1.3(a)(1). Relevant conduct
may also include uncharged offenses that would be grouped under § 3D1.2(d), and that
were “part of the same course of conduct or common scheme or plan as the offense of
conviction.” Id. § 1B1.3(a)(2). Grouping occurs under § 3D1.2(d) “[w]hen the offense
level is determined largely on the basis of the total amount of harm or loss, the quantity of
a substance involved, or some other measure of aggregate harm, or if the offense behavior
is ongoing or continuous in nature . . . .” Id. § 3D1.2(d).
Echoing the language of § 1B1.3(a)(2), the government asserts that all 28
weapons were part of a common scheme or plan and the same course of conduct.
Specifically, the government submits that when Officer Tuell asked to access Vargem’s
firearms, Vargem lied in an effort to conceal his collection, and in doing so treated all of
his weapons the same. This course of conduct, the government contends, constituted a
common scheme. While this argument may have surface appeal, it obscures the crux of
the relevant conduct analysis, which is the relationship to the offense of conviction. See
11
United States v. Pinnick, 47 F.3d 434, 439 (D.C. Cir. 1995) (when offering collateral
conduct for a court’s consideration under § 1B1.3(a)(2) , the government must
“demonstrate a connection between [that conduct] and the offense of conviction”); cf.
United States v. Farah, 991 F.2d 1065, 1070 (2d Cir. 1993) (“The central focus of the
offense-level component of a Guidelines calculation is the nature of the defendant’s
conduct in connection with the offense of conviction.”).
The Application Note to § 1B1.3 defines “common scheme or plan” as follows:
(A) Common scheme or plan. For two or more offenses to constitute part
of a common scheme or plan, they must be substantially connected to each
other by at least one common factor, such as common victims, common
accomplices, common purpose, or similar modus operandi. For example,
the conduct of five defendants who together defrauded a group of investors
by computer manipulations that unlawfully transferred funds over an
eighteen-month period would qualify as a common scheme or plan on the
basis of any of the above listed factors; i.e., the commonality of victims (the
same investors were defrauded on an ongoing basis), commonality of
offenders (the conduct constituted an ongoing conspiracy), commonality of
purpose (to defraud the group of investors), or similarity of modus operandi
(the same or similar computer manipulations were used to execute the
scheme).
U.S.S.G. § 1B1.3, Application Note 9(A). This Court has long held that “the essential
components of the section 1B1.3(a)(2) analysis are similarity, regularity, and temporal
proximity.” United States v. Hahn, 960 F.2d 903, 910 (9th Cir. 1992); see also U.S.S.G.
§ 1B1.3, Application Note 9(B) (defining “[s]ame course of conduct”).
Vargem was convicted of possessing an unlawful, unregistered machine gun. The
conduct giving rise to that offense was his active modification of a legal weapon into a
weapon that was prohibited under 18 U.S.C. § 922(o). In contrast, other weapons
12
discovered at his home were legally-purchased, unmodified, and in some instances, still
in their original packaging. When those otherwise-lawful weapons were rendered
suddenly unlawful by the EPRO, there was no common scheme or plan to possess all 28
weapons unlawfully.
Indeed, applying the definition of a common scheme or plan set forth in the
Application Note, there were no common victims or accomplices with respect to the 28
firearms in question. See U.S.S.G. § 1B1.3, Application Note 9(A). Nor was there a
common purpose or modus operandi. Id. Similarly, Vargem’s possession of other
weapons was not part of the same course of conduct, as there was no “single episode,
spree, or ongoing series of offenses.” Id., Application Note 9(B). Instead, numerous
weapons were rendered temporarily unlawful by an alleged assault that bore no
relationship in time, purpose, or mode to the machine gun offense.
Relevant conduct in firearms cases generally arises under one of two scenarios.
The first is where the firearms are otherwise legal but the defendant, usually due to
criminal history or prohibited status under federal law, is not able to legally possess them.
See, e.g., United States v. Brummett, 355 F.3d 343, 344-45 (5th Cir. 2003); United States
v. Powell, 50 F.3d 94, 104 (1st Cir. 1995). The second is where the defendant is not a
prohibited person per se, but the firearms he possessed were illegal for him, or anyone
else, to own. This case does not fit within the first scenario, as the government concedes
that Vargem was not a prohibited person under federal law. The Court must therefore
consider the second scenario, and based upon the current record, there is no evidence to
13
support the conclusion that each of Vargem’s other 27 firearms was illegal.
Accordingly, it was error for the district court to have included all 28 firearms
under § 2K2.1(b)(1). We further find, for substantially the same reasons set forth above
regarding miscalculation of the base offense level, that application of a full six-level
enhancement violated Vargem’s substantial rights. See, e.,g., Bonilla-Guizar, 729 F.3d at
1188. As this error may well have resulted in a longer sentence, it also affected the
fairness of the judicial proceedings. Tapia, 665 F.3d at 1063. We therefore vacate
Vargem’s sentence, and remand to the district court for further proceedings.
III. The District Court’s Imposition of a Fine Was Not Erroneous
Vargem’s final argument is that the district court erred when it imposed a $12,500
fine without considering the relevant statutory or Guidelines factors. The court reviews
the fine determination for clear error, United States v. Brickey, 289 F.3d 1144, 1152 (9th
Cir. 2002), overruled on other grounds by United States v. Contreras, 593 F.3d 1135,
1136 (9th Cir. 2010)), and the burden is on Vargem to show inability to pay by a
preponderance of evidence. See United States v. Robinson, 20 F.3d 1030, 1033 (9th Cir.
1994).
U.S.S.G. § 5E1.2(a) states that a court “shall impose a fine in all cases, except
where the defendant establishes that he is unable to pay and is not likely to become able
to pay any fine.” Here, Vargem did not provide a financial statement. The PSR found
that his business had several pieces of valuable machinery, that his credit history showed
minimal debt, that he was supporting himself on a savings account while in custody, and
14
that he had retained counsel. The PSR therefore concluded that a fine was appropriate,
and recommended an amount at the low end of the Guidelines range. Vargem objected to
the imposition of a fine, arguing that his state and federal criminal proceedings had
resulted in substantial financial losses, and that his imprisonment deprived him of the
ability to provide a financial statement.
Vargem now argues that the district court failed to follow § 5E1.2(d)(2), which
requires a court to consider “any evidence presented as to the defendant’s ability to pay
the fine (including the ability to pay over a period of time) in light of his earning capacity
and financial resources.” U.S.S.G. § 5E1.2(d)(2). The district court noted the lack of a
financial statement, reviewed the factual findings set forth in the PSR, and heard
Vargem’s oral assertions at sentencing. Although the court did not cite specific financial
resources when determining the fine, “[a] district court need not articulate every factor
involved in sentencing.” United States v. Orlando, 553 F.3d 1235, 1240 (9th Cir. 2009).
The district court’s imposition of a fine is affirmed.
CONCLUSION
For the reasons set forth above, we hold that the district court committed plain
error in calculating Vargem’s offense level under the Guidelines. We affirm the
imposition of a fine, vacate the sentence, and remand for further proceedings.
AFFIRMED IN PART, VACATED IN PART, AND REMANDED.
15
COUNSEL LISTING
Steven G. Kalar, Federal Public Defender, Candis Mitchell (argued), Assistant
Federal Public Defender, and Steven J. Koeninger, Research and Writing Attorney,
San Francisco, CA, for defendant-appellant.
Melinda Haag, United States Attorney, Barbara J. Valliere, Chief, Appellate
Division, and Owen P. Martikan (argued), Assistant United States Attorney, San
Francisco, CA, for plaintiff-appellee.
16