United States v. Daniel Siddons , 660 F.3d 699 ( 2011 )

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
____________
No. 10-1350
_____________
UNITED STATES OF AMERICA
v.
DANIEL R. SIDDONS,
Appellant
_____________
APPEAL FROM THE UNITED STATES DISTRICT
COURT FOR THE EASTERN DISTRICT OF
PENNSYLVANIA
(D.C. Crim. No. 07-cr-00717-001)
District Judge: Honorable Paul S. Diamond
____________
Submitted Under Third Circuit LAR 34.1(a)
September 13, 2011
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Before: RENDELL, JORDAN and BARRY, Circuit Judges
(Opinion Filed: October 5, 2011)
____________
Todd E. Henry, Esq.
22nd Floor
1500 Walnut Street
Philadelphia, PA 19102-0000
Counsel for Appellant
Mary A. Futcher, Esq.
Ashley K. Lunkenheimer, Esq.
Office of United States Attorney
615 Chestnut Street
Suite 1250
Philadelphia, PA 19106
Counsel for Appellee
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OPINION OF THE COURT
____________
BARRY, Circuit Judge
Daniel Siddons pled guilty to a 34-count indictment
charging him with various types of fraud. Prior to sentencing,
Siddons moved to withdraw his guilty plea, a motion the
District Court denied. At sentencing, the Court imposed
certain enhancements and varied upward from the
recommended Sentencing Guidelines range. Siddons now
appeals the denial of his motion to withdraw the guilty plea,
as well as the imposition of the sentencing enhancements and
the upward variance. We will affirm.
I. Background
Siddons was a licensed financial adviser working at the
investment arm of Mellon Bank (later Citizens Bank), and
then at Wachovia Securities. His job involved advising
clients about purchasing investment products, and many of his
clients were elderly customers seeking to invest their
retirement savings. On November 15, 2007, a grand jury
indicted Siddons, charging him with nine counts of mail
fraud, in violation of 18 U.S.C. § 1341, five counts of wire
fraud, in violation of 18 U.S.C. § 1343, and one count of bank
fraud, in violation of 18 U.S.C. § 1344. A superseding
indictment was later returned charging thirty-four counts of
2
mail, wire, and bank fraud. The Government alleged that
Siddons solicited his bank clients to invest in speculative real
estate transactions that he controlled and that were unrelated
to bank products, an illegal practice in the securities industry
known as “selling away.” Some of his clients invested their
modest life savings with Siddons, initially believing that they
were investing in a bank-supported, conservative investment
product. The Government accused Siddons of collecting
$1.55 million between October 2002 and January 2006.
On February 3, 2009, while he was out on bail,
Siddons requested that the District Court appoint him a new
attorney; the Court denied his request. On March 3, 2009,
one week prior to trial, the Court held a change of plea
hearing after Siddons indicated that he wished to plead guilty.
During the plea colloquy, Siddons stated that he was not
satisfied with his attorney, and the Court called a halt to the
plea proceedings. The Government’s motion to revoke bail
was then addressed, with the Court hearing sworn testimony
from Siddons and remanding him after finding that he had
contacted witnesses. Before the Court entered the remand
order, Siddons stated that he wished to plead guilty to one
count, and the Court recessed for Siddons to consult with his
attorney. Following the recess, Siddons stated, upon repeated
questioning by the Court, that he was “unequivocally”
satisfied with his attorney, Supp. App. at 118, and he
thereafter pled guilty to all counts of the indictment without a
written plea agreement.
On July 15, 2009, Siddons, represented by new
counsel, filed a motion to withdraw the plea. The District
Court held a hearing, and Siddons and his father, who had
been present at the meeting during the recess on March 3,
2009, testified that Siddons’ prior attorney was unprepared to
go to trial and had browbeaten Siddons into pleading guilty.
That attorney and his associate testified and challenged
Siddons’ testimony. The Court stated that it did not believe
Siddons, that the Government would be prejudiced by a
withdrawal of the plea, and that Siddons had not adequately
supported his claim of innocence. The motion was denied.
3
Siddons’ Presentence Investigation Report listed a
Guidelines range of 78 to 97 months. The range included a
four-level enhancement pursuant to U.S.S.G. §
2B1.1(b)(16)(A) (2008) because the offense involved a
violation of securities law and Siddons was a financial
adviser. The District Court imposed a two-level enhancement
for obstruction of justice because it found that Siddons
provided materially false information to the Court during his
testimony at the hearing on the motion for new counsel and at
the hearing to withdraw his guilty plea. It also found that he
obstructed justice by contacting witnesses. With the
enhancements, the final Guidelines range was 135 to 168
months. After reviewing the 18 U.S.C. § 3553(a) factors, the
Court varied upward and imposed a sentence of 180 months
on each count, to be served concurrently, as well as $1.3
million in restitution.
Siddons appeals the District Court’s (1) denial of his
motion to withdraw the guilty plea; (2) imposition of the four-
level enhancement under § 2B1.1(b)(16)(A); (3) imposition of
the two-level obstruction of justice enhancement; and (4)
upward variance to 180 months.
II. Discussion 1
We review a district court’s ruling on a motion to
withdraw a guilty plea for abuse of discretion. United States
v. Martinez, 785 F.2d 111, 113 (3d Cir. 1986). We review a
district court’s factual findings regarding adjustments to the
Guidelines range for clear error, and we review the court’s
“legal interpretation and application of the sentencing
guidelines under a plenary standard.” United States v. Powell,
113 F.3d 464, 467 (3d Cir. 1997). Finally, we review the
reasonableness of the ultimate sentence for abuse of
discretion. Gall v. United States, 552 U.S. 38, 46 (2007).
1
We have jurisdiction pursuant to 28 U.S.C. § 1291 and 18
U.S.C. § 3742.
4
A. Withdrawal of the Guilty Plea
A defendant seeking to withdraw a guilty plea bears a
substantial burden of “showing a ‘fair and just reason’ for the
withdrawal of his plea.” United States v. King, 604 F.3d 125,
139 (3d Cir. 2010) (quoting Fed. R. Crim. P. 11(d)(2)).
Accordingly, “[a] shift in defense tactics, a change of mind, or
the fear of punishment are not adequate reasons to impose on
the government the expense, difficulty, and risk of trying a
defendant who has already acknowledged his guilt by leading
guilty.” United States v. Jones, 336 F.3d 245, 252 (3d Cir.
2003) (citation and quotation marks omitted). When
determining whether a defendant has shown a “fair and just
reason” for withdrawing a plea, a district court must consider
whether: “(1) the defendant asserts his innocence; (2) the
defendant proffered strong reasons justifying the withdrawal;
and (3) the government would be prejudiced by the
withdrawal.” King, 604 F.3d at 139 (internal quotation marks
omitted). “Assertions of innocence must be buttressed by
facts in the record that support a claimed defense.” United
States v. Wilson, 429 F.3d 455, 458 (3d Cir. 2005) (citation
and quotation marks omitted). Further, a defendant must also
“give sufficient reasons to explain why contradictory
positions were taken before the district court.” Jones, 336
F.3d at 253 (citation and quotation marks omitted).
Siddons argues that his “fair and just reason” for
seeking to withdraw his guilty plea was that at the time of his
plea, his attorney was unprepared to go to trial and pressured
him into pleading. Siddons’ appeal on this issue fails for at
least three reasons. First, while he states that he is innocent,
he does not, as required, cite to any record evidence that
would support his claim of innocence or sufficiently explain
the contradictory position he took during the plea colloquy.
Second, the District Court correctly found that the
Government would be prejudiced by the withdrawal of the
plea. Many of the Government witnesses were elderly, and
there was a real risk that key witnesses would pass away or
memories would fail prior to trial; indeed, at least four victims
had died between the time of the defendant’s fraud and the
time of his motion to withdraw the plea. Reopening the case
5
would delay the trial and increase the likelihood that other
witnesses would be unable to testify on behalf of the
Government. Finally, as the Court found after the hearing on
the motion to withdraw the plea, Siddons’ attorney was
prepared to try the case had Siddons not pled guilty on March
3, 2009. Accordingly, there was no “fair and just reason”
justifying the withdrawal of the plea.
B. The Four-Level Investment Adviser
Enhancement
A defendant’s Guidelines range is to be increased by
four levels if the offense involved
a violation of securities law and, at the time of
the offense, the defendant was (i) an officer or a
director of a publicly traded company; (ii) a
registered broker or dealer, or a person
associated with a broker or dealer; or (iii) an
investment adviser, or a person associated with
an investment adviser.
U.S.S.G. § 2B1.1(b)(16)(A) (2008). 2
The District Court applied this provision. Siddons
argues, however, that (1) he was not technically an investment
adviser 3 in March 2003, the time that the indictment sets as
the earliest offense date for the wire fraud counts; and (2) the
§ 2B1.1(b)(16)(A) enhancement did not exist at the time that
2
The current Guidelines Manual recodifies this provision at §
2B1.1(b)(17)(A).
3
The Guidelines use the definition of “investment adviser”
listed at 15 U.S.C. § 80b-2(a)(11), which states, in relevant
part, that investment adviser “means any person who, for
compensation, engages in the business of advising others,
either directly or through publications or writings, as to the
value of securities or as to the advisability of investing in,
purchasing, or selling securities, or who, for compensation
and as part of a regular business, issues or promulgates
analyses or reports concerning securities.”
6
he was an investment adviser, so it is an ex post facto
violation to apply it to him.
With reference to his first argument, Siddons began
“selling away” in 2002, while employed as a financial adviser
at Wachovia Securities. When Wachovia found out, Siddons
resigned under threat of termination on January 23, 2003.
The pertinent indictment against Siddons alleges that he
committed instances of wire fraud, at the earliest, on March 3,
2003, after his resignation from Wachovia. The enhancement
under § 2B1.1(b)(16)(A) still applies, however, because, as
the Government states, “[t]he determination of loss and other
factors pertinent to a fraudulent scheme is never confined to
the date of the charged mailing or wiring, but always
encompasses all relevant conduct that was ‘part of the same
course of conduct or common scheme or plan.’” Appellee’s
Br. at 78 (quoting U.S.S.G. § 1B1.3(a)(2)); see also United
States v. Stephens, 198 F.3d 389, 390-91 (3d Cir. 1999)
(permitting consideration of uncharged conduct beyond
statute of limitations for purposes of Guidelines determination
in fraud case). Accordingly, because Siddons was an
“investment adviser” when he began fraudulently obtaining
the victims’ money, the enhancement in § 2B1.1(b)(16)(A)
applies.
Siddons’ ex post facto claim requires somewhat deeper
analysis. 4 In most situations, “a court must use only one
4
In brief, “[t]he Ex Post Facto Clause of the Constitution
prohibits application of a law enacted after the date of the
offense that inflicts a greater punishment[] than the law
annexed to the crime when committed.” United States v.
Pennavaria, 445 F.3d 720, 723 (3d Cir. 2006) (citation and
internal quotation marks omitted). The principles of the
clause relate to the “core due process concepts of notice,
foreseeability, and, in particular, the right to fair warning as
those concepts bear on the constitutionality of attaching
criminal penalties to what previously had been innocent
conduct.” Id. (citation and quotation marks omitted). “The
ex post facto inquiry has two prongs: (1) whether there was a
change in the law or policy which has been given
7
version of the Guidelines under the ‘one book rule,’ and must
apply that version in its entirety.” United States v. Mills, 613
F.3d 1070, 1072 n.2 (11th Cir. 2010) (citing U.S.S.G. §
1B1.11(b)(2)). The Guidelines state that “[t]he court shall use
the Guidelines Manual in effect on the date that the defendant
is sentenced.” U.S.S.G. § 1B1.11(a). However, if the court
determines that use of the Guidelines Manual in effect on the
sentencing date would violate the ex post facto clause, “the
court shall use the Guidelines Manual in effect on the date
that the offense of conviction was committed.” Id. §
1B1.11(b)(1); see also United States v. Larkin, 629 F.3d 177,
193 (3d Cir. 2010).
Importantly, however, the Guidelines also instruct that
“[i]f the defendant is convicted of two offenses, the first
committed before, and the second after, a revised edition of
the Guidelines Manual became effective, the revised edition
of the Guidelines Manual is to be applied to both offenses.”
U.S.S.G. § 1B1.11(b)(3). Siddons argues that because the
enhancement contained in § 2B1.1(B)(16)(A) did not exist
until November 1, 2003, after he was no longer an investment
adviser, it was a violation of the ex post facto clause when the
District Court applied the enhancement from the 2008
Manual, rather than using the 2002 Manual without the
enhancement. The Government contends that there was no ex
post facto violation because the Sentencing Guidelines’
“grouping” provision for continuing crimes (U.S.S.G. §
3D1.2(d)), combined with the one-book rule and §
1B1.11(b)(3), put Siddons on notice that he would be
sentenced for fraud under the later-enacted Guidelines
Manual.
We have held that courts may use the later-enacted
Guidelines Manual for sentencing “straddle” crimes—
continuing offenses that started before an intervening change
in the Guidelines but that ended afterward. See United States
retrospective effect, and (2) whether the offender was
disadvantaged by the change.” Newman v. Beard, 617 F.3d
775, 784 (3d Cir. 2010) (citation and quotation marks
omitted). The only issue in this appeal is the first prong.
8
v. Brennan, 326 F.3d 176, 198 (3d Cir. 2003) (“[A]pplication
of the November 2000 Sentencing Guidelines would still not
violate the ex post facto clause if the fraud continued after the
effective date of the amendment.”); United States v. Moscony,
927 F.2d 742, 754 (3d Cir. 1991); United States v. Rosa, 891
F.2d 1063, 1068-69 (3d Cir. 1989). The crime here, wire
fraud, is not technically a straddle crime because mail and
wire fraud are not continuing offenses but, rather, are crimes
that are complete upon the execution of each mailing or
wiring. See United States v. Seligsohn, 981 F.2d 1418, 1425
(3d Cir. 1992), superseded by statute for other reasons as
stated in United States v. Corrado, 53 F.3d 620, 624 (3d Cir.
1995).
The Government argues, however, that in cases of a
continuing course of wire fraud, “the guideline calculation for
a fraud offense is based on the entirety of the conduct during
the scheme,” and thus “it is appropriate to apply the guideline
manual in effect at the time the fraud ended, on the theory that
the defendant was fully on notice as he continued his conduct
of the enhanced penalty.” Appellee’s Br. at 82. The
Government relies on the “grouping” provision of U.S.S.G. §
3D1.2, which states that “[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 and the offense guideline is
written to cover such behavior,” then “[a]ll counts involving
substantially the same harm shall be grouped together into a
single Group.” U.S.S.G. §§ 3D1.2(d), 3D1.2. Because, the
argument goes, the District Court correctly relied on §
3D1.2(d) to group the thirty-four related counts of conviction
for purposes of determining the offense level, see PSR ¶ 86,
the Court appropriately applied “the final applicable manual
to the entire sum of the wrongdoing.” Appellee’s Br. at 85.
The majority of Courts of Appeals that have decided
the issue have held that use of the later-enacted Guidelines
Manual in such circumstances is not an ex post facto violation
because § 3D1.2, in combination with the one-book rule,
gives notice to the defendant that his or her offenses may be
9
grouped for sentencing purposes and that the later-enacted
Manual will apply. In United States v. Vivit, 214 F.3d 908
(7th Cir. 2000), for instance, the defendant was convicted of
numerous counts of mail fraud involving false claims to
insurance companies. Certain mailings involved minors, but
those mailings occurred prior to the enactment of a two-point
enhancement for use of a minor. Id. at 916-17. Other
mailings that led to counts of conviction occurred after the
enactment of the enhancement, but the district court applied
the enhancement after grouping the convictions pursuant to §
3D1.2(d). The Seventh Circuit stated
that the relevant inquiry becomes whether the
grouping rules give the defendant fair notice at
the time a crime is consummated that the
commission of further crimes subject to
grouping would subject the defendant to
sentencing under revised Guidelines. The
grouping rules, enacted in 1987, provide
warning to criminals that completing another
criminal offense similar to one committed
previously places them in peril of sentencing
under a revised version of the Guidelines. The
introductory commentary to the grouping rules
explains that because the offense guideline for
fraud, § 2F1.1, “deal[s] with repetitive or
ongoing behavior,” multiple fraud convictions
are appropriately grouped when the convictions
involve substantially the same harm. See
U.S.S.G. § 3D introductory commentary. We
believe that this conclusion reflects the intent of
the Sentencing Commission to provide notice to
criminals that engaging in ongoing fraudulent
behavior involving the same type of harm risks
grouping of convictions, which because of the
one-book rule, will all be sentenced according
to the Guidelines in effect when the latest
conduct occurred.
Id. at 919 (emphasis added).
10
Accordingly, the Seventh Circuit held that there was no
ex post facto violation by virtue of the district court’s decision
to apply the “use of minors” enhancement to all of the
grouped offenses. Similar reasoning has prevailed in the
majority of Courts of Appeals that have addressed the issue.
See United States v. Kumar, 617 F.3d 612, 626-28 (2d Cir.
2010); United States v. Duane, 533 F.3d 441, 449 (6th Cir.
2008); United States v. Sullivan, 255 F.3d 1256, 1262-63
(10th Cir. 2001); United States v. Kimler, 167 F.3d 889, 893-
95 (5th Cir. 1999); United States v. Bailey, 123 F.3d 1381,
1404-07 (11th Cir. 1997); United States v. Cooper, 35 F.3d
1248, 1250-53 (8th Cir. 1994), vacated, 514 U.S. 1094
(1995), reinstated, 63 F.3d 761, 762 (8th Cir. 1995) (per
curiam); 5 but see United States v. Ortland, 109 F.3d 539, 546-
47 (9th Cir. 1997) (finding an ex post facto violation and
requiring the district court to sentence the defendant under
different Guidelines Manuals depending upon the date of the
completion of the charged conduct in a multiple-count
indictment).
Similarly, our decision in United States v. Bertoli, 40
F.3d 1384 (3d Cir. 1994), does not mandate a finding of an ex
post facto violation. There, we held that where the district
court grouped discrete acts of obstruction of justice for
sentencing purposes, it was error to use a Guidelines Manual
containing an enhancement enacted after the completion of
some of the relevant conduct. Id. at 1401-04; id. at 1404
(“The fact that various counts of an indictment are grouped
cannot override ex post facto concerns.”). In Bertoli,
however, we did not address the grouping provision at issue
here, U.S.S.G. § 3D1.2(d), the provision we discussed above.
Indeed, in Bertoli, there was no indication as to why the
district court grouped the disparate conduct, but it could not
5
At least one circuit has found no ex post facto violation in
similar circumstances based only on the fact that §
1B1.11(b)(3) gave fair warning to the defendant that the later-
enacted Guidelines Manual would be used; the court did not
address grouping, even though the crimes involved repeated
commission of the same offenses. See United States v. Lewis,
235 F.3d 215, 218 (4th Cir. 2000).
11
have been for the reasons stated in § 3D1.2(d) because the
government itself acknowledged that grouping was improper.
See id. at 1403 n.16 (“On appeal, the government does not
endorse the district court’s decision to combine Counts Three
and Six for the purpose of determining which Manual applies.
Rather, the government’s sole argument is that the 1989
Manual is not more favorable to Bertoli than the 1993
Manual.”).” Unlike Siddons’ actions, which involved
ongoing, connected fraudulent conduct occurring both before
and after the enactment of the sentencing enhancement, the
defendant’s actions in Bertoli involved discrete, unconnected
acts. We agree with those Courts of Appeals that have found
no ex post facto violation when a court groups continuing,
related conduct and applies the Guidelines Manual in effect
during the latest-concluded conduct. This is so because the
grouping provisions, combined with the one-book rule, place
a defendant on notice that a court will sentence him or her
under the Guidelines Manual in effect during the commission
of his or her last offense in a series of continuous, related
offenses.
Applying this analysis to Siddons, the District Court
did not err in using the 2008 Guidelines Manual with the four-
level enhancement at § 2B1.1(b)(16)(A). Siddons was an
investment adviser when he initiated the fraud that led to his
convictions. Even though he was no longer an investment
adviser as of the date of the first offense or at the time of the
enactment of the enhancement, a court considers his “relevant
conduct” as an investment adviser in determining his
Guidelines range. See U.S.S.G. § 1B1.3(a)(2). Due to the
grouping rules at § 3D1.2(d) and the one-book rule at §
1B1.11, Siddons was on constructive notice that the
November 1, 2003 enhancement could apply to his entire
scheme, should he continue the conduct after the date of
enactment. As the Eighth Circuit aptly stated, “it was not the
amendments to the Sentencing Guidelines that disadvantaged
[Siddons], it was his election to continue his criminal activity
[after the effective date of the enhancements].” Cooper, 35
F.3d at 1250. There was no ex post facto violation here.
12
C. The Obstruction of Justice Enhancement
The District Court imposed a two-level enhancement
based on § 3C1.1, which states
[i]f (A) the defendant willfully obstructed or
impeded, or attempted to obstruct or impede, the
administration of justice with respect to the
investigation, prosecution, or sentencing of the
instant offense of conviction, and (B) the
obstructive conduct related to (i) the
defendant’s offense of conviction and any
relevant conduct; or (ii) a closely related
offense, increase the offense level by 2 levels.
U.S.S.G. § 3C1.1.
The District Court found that Siddons had (1) lied
about his reasons for wanting to change counsel and the
nature of his dispute with his original counsel; (2) lied under
oath when he attempted to withdraw his plea and explain his
reasons for pleading guilty; and (3) attempted to unlawfully
influence the testimony of witnesses and then lied about the
reasons behind his behavior. The application notes to the
Guidelines support all of the Court’s reasons for imposing the
enhancement. See U.S.S.G. §§ 3C1.1 cmt. n.4(a) (attempting
to unlawfully influence a witness), cmt. n.4(f) (providing
materially false information to a judge).
Siddons challenges the District Court’s credibility
determination, arguing that the Court misinterpreted his
testimony on all fronts, and that he did not believe that he was
violating the terms of his bail when he contacted witnesses.
We will not disturb a sentencing court’s factual findings
unless, on review of the entire evidence, we are “left with the
definite and firm conviction that a mistake has been
committed.” United States v. Starnes, 583 F.3d 196, 215 (3d
Cir. 2009) (citation and quotation marks omitted). Having
reviewed the transcripts of the various hearings, we cannot
say that the Court committed error, much less that we have a
definite and firm conviction there was error.
13
D. The Reasonableness of the Sentence
Finally, Siddons argues that the District Court
unreasonably applied the 18 U.S.C. § 3553(a) factors, and that
his 180-month sentence was unduly punitive and greater than
necessary. He contends that the only reason that he received
such a high, above-Guidelines sentence was because he aired
his grievances about his attorney with the Court, and the
Court held the failure of that relationship against him at
sentencing.
The record does not support Siddons’ arguments. The
District Court stated that it was imposing an above-Guidelines
sentence because of the nature of Siddons’ crimes against
elderly investors and the “abhorrent nature” of the crimes,
Supp. App. at 514; because of his abuse of his position as a
financial adviser; and because the Court found that he
“appears to have absolutely [no] compunction about lying,
lying under oath. He appears to have no conscience.” Id. at
510. The Court concluded, with reference to the “no
conscience” component, that “the public does, indeed, need
protection from the defendant” as “he would be likely to
repeat his crimes if he were at liberty or to commit criminal
acts if he were at liberty.” Id. The Court acted well within its
discretion when it varied upward in sentencing Siddons. The
reasons it gave are persuasive and fully supported by the
record.
Siddons does not argue that the District Court
committed any procedural error. Under our “highly
deferential” standard of review of a sentencing court’s
decisions, we are to affirm a court’s procedurally sound
sentence “unless no reasonable sentencing court would have
imposed the same sentence on that particular defendant for
the reasons the district court provided.” United States v.
Merced, 603 F.3d 203, 214 (3d Cir. 2010) (citation and
quotation marks omitted). Given the record before us, we
simply cannot find that no reasonable court would have
imposed a sentence one year longer than the highest
Guidelines range.
14
III. Conclusion
We will affirm the judgment of sentence.
15