United States v. Todd Horob , 735 F.3d 866 ( 2013 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 11-30119
Plaintiff-Appellee,
D.C. No.
v. 1:08-cr-00093-RFC-1
TODD KENNETH HOROB,
Defendant-Appellant. OPINION
Appeal from the United States District Court
for the District of Montana
Richard F. Cebull, District Judge, Presiding
Argued and Submitted
October 8, 2013—Portland, Oregon
Filed November 7, 2013
Before: Barry G. Silverman, William A. Fletcher,
and Consuelo M. Callahan, Circuit Judges.
Per Curiam Opinion
2 UNITED STATES V. HOROB
SUMMARY*
Criminal Law
The panel affirmed the district court’s imposition of the
same total sentence on remand for resentencing for bank
fraud, wire fraud, money laundering, and bankruptcy scheme
to defraud, after this court in a prior appeal overturned the
defendant’s convictions of false statements to a bank and
aggravated identity theft.
The panel held that the presumption of vindictiveness
does not apply when a district court does not impose a more
severe overall sentence on remand, even when as here the
vacated conviction carried a mandatory consecutive sentence.
The panel also held that the defendant failed to show actual
vindictiveness.
The panel held that the district court properly considered
as relevant conduct uncharged loans that were part of a
common scheme with the offense of conviction, that the
district court did not err in applying a sophisticated means
enhancement, and that the district court did not err in
rejecting the defendant’s challenge to the accuracy of the trial
transcripts.
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
UNITED STATES V. HOROB 3
COUNSEL
Chad Wright (argued), Wright Legal, P.C., Helena, Montana,
for Defendant-Appellant.
Kelly A. Zusman (argued), Assistant United States Attorney,
United States Attorney’s Office, Portland, Oregon; Michael
W. Cotter, United States Attorney, and J. Bishop Grewell,
Assistant United States Attorney, United States Attorney’s
Office, Billings, Montana, for Plaintiff-Appellee.
OPINION
PER CURIAM:
Todd Kenneth Horob was convicted of false statements to
a bank, bank fraud, wire fraud, money laundering, bankruptcy
scheme to defraud, and aggravated identity theft. On appeal,
we overturned the convictions of false statements to a bank
and aggravated identity theft, the latter of which carried a
mandatory 24-month consecutive sentence. We affirmed
Horob’s convictions on the remaining counts and remanded
for resentencing. In this second appeal, Horob contends that
the district court erred when it: (i) imposed the same 132-
month sentence on remand; (ii) considered uncharged
conduct when calculating the enhancement level and imposed
a sophisticated means enhancement; and (iii) refused his
request for an evidentiary hearing on the accuracy of the trial
transcripts. We have jurisdiction pursuant to 28 U.S.C.
§ 1291, and we affirm. It is apparent from the record that the
district court sentenced Horob, both originally and on
remand, in light of the totality of the circumstances, including
the nature of the crime and the character and history of the
4 UNITED STATES V. HOROB
defendant. In such a case, we hold that the presumption of
vindictiveness does not apply when a district court does not
impose a more severe sentence on remand, even when the
vacated conviction carried a mandatory sentence.
I.
Horob had been a livestock buyer and cattle rancher since
he graduated from high school, and for many years he was a
trusted businessman. In 2003, he began speculating on the
cattle futures market and lost a large amount of money,
approximately two million dollars. In order to cover his ever-
increasing debts, he took out more and more loans. He
secured these loans with cattle he did not own and promised
to use these loans for profitable business enterprises that did
not exist. To cover up his fraud, he lied even more and asked
others to lie for him. He fabricated documents and laundered
money. Horob’s scheme eventually unraveled when the bank
noticed inconsistencies in his statements about the cattle
offered as collateral. When the banks tried to verify the
cattle’s existence, Horob created fraudulent brand certificates
and sent the bankers to feedlots in Nebraska, North Dakota,
Minnesota, and Montana. Horob did not own cattle at these
feedlots, but he had the owners lie on his behalf. At other
times, Horob and his employee simply pointed to cows out in
the field and claimed them as their own.
When Horob filed for bankruptcy in March 24, 2006, the
banks discovered that he only owned 60 head of cattle, not
the thousands he had claimed. With little real collateral to
collect on its $5.85 million loans, Wells Fargo lost $4.5
million. Dakota West Credit Union lost close to $1 million
and 20% of its equity.
UNITED STATES V. HOROB 5
After a contentious trial, Horob was found guilty of all
seven counts of the indictment, including a count of
aggravated identity theft that carried a mandatory 24-month
consecutive sentence. At the sentencing hearing, the court
calculated a guideline range of 135 to 168 months for the
non-aggravated identity theft charges, but determined that a
lower range of 87 to 108 months was more appropriate in
light of the 24-month mandatory consecutive sentence.
Horob was sentenced to a total of 132 months by the district
court: 108 months on Counts I–V, 60 months on Count VI to
be served concurrently, plus 24 months consecutive on Count
VII (aggravated identity theft). The court stated that 132
months was the sentence “required in this case to provide just
punishment” and “deter conduct.”
On appeal, we reversed two counts, including the count of
aggravated identity theft, and affirmed Horob’s convictions
on the other counts. United States v. Horob, 407 F. App’x
228 (9th Cir. 2011). On remand, the district court kept
Horob’s sentence at 132 months by increasing the sentences
on the remaining counts. The court explained that it had
varied the sentence downward at the first sentencing hearing
because the addition of the 24-month consecutive sentence
for aggravated identity theft would have made the sentence
“more than necessary as required under the law.” Without
the 24-month mandatory consecutive sentence, the court felt
the guideline range of 135–168 months was “pretty close.”
II.
Horob contends that the district court acted vindictively
when it imposed the same total sentence on remand. Whether
a district court’s imposition of a higher sentence at
resentencing was vindictive is reviewed under a de novo
6 UNITED STATES V. HOROB
standard. United States v. Jenkins, 504 F.3d 694, 699 (9th
Cir. 2007). A district court violates a defendant’s right to due
process of law if on remand it increases the sentence on the
remaining counts to penalize the defendant for exercising a
protected statutory or constitutional right. See United States
v. Goodwin, 457 U.S. 368, 372 (1982). Because “[t]he
existence of a retaliatory motivation would, of course, be
extremely difficult to prove in any individual case,” North
Carolina v. Pearce, 395 U.S. 711, 725 n.20 (1969), certain
circumstances give rise to a rebuttable presumption of
vindictiveness.
Vindictiveness is presumed whenever the trial judge
increases the defendant’s sentence after a successful attack on
the first conviction and the reasons for the enhancement do
not “affirmatively appear.” Nulph v. Cook, 333 F.3d 1052,
1057 (9th Cir. 2003). “Those reasons must be based upon
objective information concerning identifiable conduct on the
part of the defendant occurring after the time of the original
sentencing proceeding.” Pearce, 395 U.S. at 726.
The presumption of vindictiveness does not apply to
Horob because it is apparent that the district court considered
his overall sentence at the time of his original sentence and
again on remand, and because his overall sentence was not
increased. We have held that “[b]efore the Pearce
presumption of a vindictive motivation arises . . . the second
sentence imposed on a defendant must, in fact, be more
severe than the first.” United States v. Bay, 820 F.2d 1511,
1513 (9th Cir. 1987). A sentence is not more severe merely
because a mandatory sentence has been eliminated if the
overall sentence remains the same and “there is no net
increase in his punishment.” United States v. Hagler,
709 F.2d 578, 579 (9th Cir. 1983). Thus, no presumption of
UNITED STATES V. HOROB 7
vindictiveness arises from the fact that the sentences on a
defendant’s individual counts were increased, because the
court must look “in the aggregate and not merely with respect
to each individual count.” Bay, 820 F.2d at 1513.
In Hagler, we overturned five of Hagler’s thirteen credit
card fraud counts, including the only count that carried a
prison term and fine. 709 F.2d at 579. On remand, the
district court nonetheless kept the original 1-year prison
sentence and fine, even though the remaining counts had only
resulted in a suspended sentence and five years’ probation at
the first sentencing. Id. In Bay, we overturned two armed
robbery charges, for which the defendant had originally been
sentenced to 30 years, and at the resentencing the district
court increased the sentence on the remaining unarmed
robbery charge from 5 years of probation to 20 years in
prison. 820 F.2d at 1512. In both cases, we declined to find
a presumption of vindictiveness because the overall sentences
did not increase. Hagler, 709 F.2d at 579; Bay, 820 F.2d at
1514.
Horob claims that his case is different from Bay and
Hagler because here the reversed count carried a mandatory
consecutive sentence. But in determining Horob’s sentence,
both initially and at resentencing, the district court was
required to consider a variety of factors about the defendant
and his conduct—not just the crimes of conviction. United
States v. Booker, 543 U.S. 220, 264 (2005). Based on the
aggregate of Horob’s underlying actions, the district court
believed that a sentence of 132 months was appropriate. At
the initial sentencing, the court varied downward from the
sentencing guidelines in order to arrive at that sentence and
considered the mandatory 24-month consecutive sentence on
Count VII as part of the “totality of the circumstances.” See
8 UNITED STATES V. HOROB
Bay, 820 F.2d at 1514 (“The court constructed a ‘balanced
package geared to the particular defendant.’” (quoting
Hagler, 709 F.2d at 579)). At the resentencing, the court still
believed that a sentence of 132 months was appropriate.
Although two of the counts had been overturned and there
was no longer a mandatory 24-month consecutive sentence,
the defendant’s underlying conduct had not changed.
Horob is understandably disappointed that his successful
appeal on two counts did not result in a reduction in his final
sentence, but this does not give rise to a presumption of
vindictiveness. This rule is intended to ensure that the right
of the defendant to appeal will not be chilled by the
possibility of a longer sentence on remand, United States v.
Jackson, 390 U.S. 570, 581 (1968), as well as to guard
against “the danger that the State might be retaliating against
the accused for lawfully attacking his conviction.”
Bordenkircher v. Hayes, 434 U.S. 357, 363 (1978). To this
end, the law mandates that a defendant may not be penalized
by the imposition of a harsher sentence based on his exercise
of his right to appeal and his successfully obtaining a remand.
Pearce, 395 U.S. at 726. The fact that a defendant’s sentence
remains the same, even when the count dismissed carried a
mandatory sentence, does not create a chilling effect. If there
is a possibility of a sentence reduction and no risk of a
sentence increase, defendants will continue to appeal.
Our holding is consistent with our opinions in United
States v. Handa, 122 F.3d 690 (9th Cir. 1997), and United
States v. McClain, 133 F.3d 1191 (9th Cir. 1998). These
cases recognize that the sentencing package is “unbundled”
when a sentence is vacated and that the district court has
discretion to put together a new package. Handa, 122 F.3d at
691–92; McClain, 133 F.3d at 1194.
UNITED STATES V. HOROB 9
Horob further argues that specific language in the
aggravated identity theft statute shows that Congress did not
intend for this crime to be “bundled” or “packaged” with
other crimes. Horob asserts that 18 U.S.C. § 1028A(b)(3)1
“dictates that the sentence had to be imposed without
reference to the remaining convictions.”
In United States v. Wahid, 614 F.3d 1009, 1014 (9th Cir.
2010), we held that the aggravated identity theft statute’s
prohibition against reducing a sentence for other counts only
applied to predicate felonies enumerated in § 1028A(c).
None of Mr. Horob’s other counts of conviction involved
felonies enumerated in § 1028A(c), which is why we
dismissed the count of aggravated identity theft on appeal.
Horob, 407 F. App’x at 229. Because § 1028A(b)(3) did not
apply, the entire original sentence was interdependent and
effectively unbundled when we remanded the case for
resentencing in light of the two vacated counts. The district
court then had discretion to put together a new package.
To hold that a vacated mandatory sentence must be
deducted from the total sentence on remand would interfere
with the district court’s discretion. The district court is
familiar with the defendant and the facts of the case and is
best able to evaluate the “totality of the circumstances.” Bay,
1
Section 1028A(b)(3) reads:
in determining any term of imprisonment to be imposed
for the felony during which the means of identification
was transferred, possessed, or used, a court shall not in
any way reduce the term to be imposed for such crime
so as to compensate for, or otherwise take into account,
any separate term of imprisonment imposed or to be
imposed for a violation of this section . . . .
10 UNITED STATES V. HOROB
820 F.2d at 1514. Moreover, in cases where the presumption
does not apply, the defendant can still present evidence of
actual vindictiveness. However, our case law forecloses
applying a presumption of vindictiveness when the overall
sentence imposed is not increased.
Because the presumption of vindictiveness does not arise
in this case, the burden remains on Horob to show actual
vindictiveness. Alabama v. Smith, 490 U.S. 794, 799 (1989).
Horob believes the increased sentences on his remaining
counts were due to “the district court’s displeasure with both
the appellate reversal and the defendant’s continuing
cantankerous filings in the face of his convictions.” Horob
points to instances in the transcript where the district judge
allegedly expressed “hostility” toward him. For instance,
Horob notes that the district judge commented that Horob’s
convictions had been dismissed because of “technical” rather
than meritorious reasons and that Horob’s lack of remorse
was appalling. The cited statements do not, separately or
collectively, constitute a showing of vindictiveness. Between
the original sentencing and the remand, Horob’s underlying
fraudulent conduct had not changed, the harm to the
community and the parties involved had not changed, and his
lack of remorse had not changed. The district judge properly
considered these factors when resentencing Horob. The
statements are not sufficient to show that the district court, in
resentencing Horob, penalized him for exercising his right to
appeal.
III.
Horob argues that the district court erred when it
considered all his loans with Wells Fargo, not just the loans
charged in the indictment, in determining the level of
UNITED STATES V. HOROB 11
enhancement. Section 1B1.3 of the Sentencing Guidelines
allows judges to consider all relevant conduct when
determining the offense level. Relevant conduct is defined as
“part of the same course of conduct or common scheme or
plan as the offense of conviction.” U.S.S.G. § 1B1.3(a)(2).
A common scheme requires only that the offenses be
“substantially connected to each other by at least one
common factor.” U.S.S.G. § 1B1.3 cmt. n.9(A). Here there
are multiple common factors, including common victims
(Wells Fargo), common accomplices (Horob’s employees,
feedlot owners), a common purpose (obtain new loans), and
a similar modus operandi (pretending to have large amounts
of cattle as collateral). Since these loans were part of a
common scheme to obtain money from the banks using non-
existing cattle as collateral, the district court properly
considered the loans as relevant conduct.
Horob also challenges the district court’s imposition of a
“sophisticated means” enhancement. Section 2B1.1(b)(10) of
the Sentencing Guidelines provides for a two-level
enhancement if “the offense . . . involved sophisticated
means.” To qualify, Horob’s scheme must be “especially
complex or especially intricate,” compared to the usual fraud
offense. U.S.S.G. § 2B1.1 cmt. n.8(B). Horob’s scheme was
complex. Horob did more than lie to obtain a loan. He
manipulated several people to lie for him, used several
different bank accounts (including accounts of other people)
to move funds around, and fabricated numerous documents.
Moreover, the complicated and fabricated paper trail made
discovery of his fraud difficult. The district court did not err
in applying a sophisticated means enhancement.
12 UNITED STATES V. HOROB
IV.
Finally, Horob challenges the district court’s refusal of his
request for an evidentiary hearing on the accuracy of the trial
transcripts. A “trial court’s factual finding that transcripts are
accurate and complete cannot be disturbed unless clearly
erroneous.” United States v. Anzalone, 886 F.2d 229, 232
(9th Cir. 1989) (citing Maine v. Taylor, 477 U.S. 131, 144–45
(1986)). “[A]ssuming there were omissions in the transcripts,
appellant cannot prevail without a showing of specific
prejudice.” Id. As directed by the district court, Horob’s
former counsel compared the trial transcript to audio
recordings and confirmed that the transcript was accurate. In
addition, the court independently confirmed the transcripts’
accuracy. Moreover, Horob has not identified any alleged
substantive mistakes in the transcript that might have had an
impact on his conviction or appeal. Accordingly, the district
court’s rejection of Horob’s challenge to the accuracy of the
trial transcript is affirmed.
V.
We hold that Horob is not entitled to the presumption of
vindictiveness because the district court did not impose a
more severe sentence on remand. Horob failed to show
actual vindictiveness on the part of the district court, he failed
to show that the district court abused its discretion in finding
over $5 million in relevant conduct losses, and he failed to
show that his fraud scheme was not sufficiently complex to
warrant a sophisticated means enhancement. Finally, he has
not met his burden of showing that the trial judge’s
certification of the transcripts was clearly erroneous.
Therefore, the district court’s resentencing of Horob is
AFFIRMED.