United States v. Grigsby

FILED
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
December 7, 2016
TENTH CIRCUIT Elisabeth A. Shumaker
Clerk of Court
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
No. 16-3061
v. (D.C. No. 6:12-CR-10174-JTM-1)
PHILIP ANDRA GRIGSBY, (D. Kan.)
Defendant - Appellant.
ORDER AND JUDGMENT *
Before KELLY, HOLMES, and MORITZ, Circuit Judges.
Defendant-Appellant Philip Andra Grigsby, a federal prisoner proceeding
pro se, 1 appeals from the district court’s order that his union retirement account
*
After examining the briefs and appellate record, this panel has
decided unanimously that oral argument would not materially assist the
determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G).
The case is therefore ordered submitted without oral argument.
This order and judgment is not binding precedent except under the
doctrines of law of the case, res judicata, and collateral estoppel. It may be cited,
however, for its persuasive value consistent with Federal Rule of Appellate
Procedure 32.1 and Tenth Circuit Rule 32.1.
1
Because Mr. Grigsby appears pro se, we afford his filings liberal
(continued...)
be liquidated with the proceeds applied to his restitution judgment. Mr. Grigsby
also has filed a motion to strike the supplemental record submitted by the United
States. Exercising jurisdiction pursuant to 18 U.S.C. § 3742 and 28 U.S.C.
§ 1291, we deny the motion to strike and affirm the district court’s order.
I
Mr. Grigsby pleaded guilty to eight counts of sexual exploitation of a child,
18 U.S.C. § 2251(a), one count of possession of child pornography, 18 U.S.C.
§ 2252(a)(4)(B), and one count of felon in possession of a firearm, 18 U.S.C.
§ 922(g)(1). The district court sentenced him to 260 years’ imprisonment, 10
years’ supervised release, and forfeiture of the property listed in the indictment.
Initially, the court deferred ruling on victim restitution to allow for an evidentiary
hearing regarding that matter. After that hearing, the court ordered Mr. Grigsby
to pay $140,000 in restitution.
Mr. Grigsby has repeatedly challenged his restitution judgment through
different avenues of attack in the district court and before us. 2 His latest
1
(...continued)
construction, but do not act as his advocate. See Yang v. Archuleta, 525 F.3d 925,
927 n.1 (10th Cir. 2008).
2
We have previously described this case as presenting a “procedural
maze”—a very apt description. United States v. Grigsby (Grigsby II), 579 F.
App’x 680, 681 (10th Cir. 2014). We endeavor to restrict our discussion of the
factual and procedural history of Mr. Grigsby’s litigation subsequent to his
criminal conviction to only those matters necessary or helpful for understanding
(continued...)
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challenge—forming the basis for this appeal—stems from the district court’s
order requiring the International Brotherhood of Electrical Workers (“IBEW”)
Local No. 661 to liquidate a retirement account held on Mr. Grigsby’s behalf and
to pay the proceeds to the clerk of the court for application to Mr. Grigsby’s
restitution judgment. Mr. Grigsby failed to disclose the retirement account in a
financial affidavit he provided to the United States Probation Office in advance of
his sentencing as required by 18 U.S.C § 3664(d)(3). The United States
discovered the existence of the retirement account after Mr. Grigsby’s sentencing
when reviewing documents filed by Mr. Grigsby in his state court divorce
proceeding; Mr. Grigsby had disclosed the account as an asset. Specifically, at
the time of his sentencing, Mr. Grigsby had a fully vested interest in the IBEW
retirement account that was valued at approximately $53,604. The United States
has attempted to gain control over the account by various means so that it can be
applied to Mr. Grigsby’s restitution judgment. To provide helpful context for our
resolution of this appeal, we very briefly summarize the history of the litigation
culminating in the instant proceedings.
A
Before the district court conducted the original restitution hearing, Mr.
Grigsby filed his first of many appeals to this court. In his initial appeal, Mr.
2
(...continued)
our resolution of the current appeal.
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Grigsby challenged only the reasonableness of his 260-year sentence (on both
substantive and procedural grounds). He did not challenge his conviction, the
terms of his supervised release, or the forfeiture of his property. Nor did he
challenge the restitution judgment; it had yet to be entered against him at the time
he filed his initial appeal. We upheld the sentence, concluding that it was
procedurally and substantively reasonable.
The district court conducted the original restitution hearing on July 29 and
30, 2013. At the close of the hearing, the court entered an amended judgment
awarding $126,440 in restitution to the minor victim and $13,560 to her mother
(Mr. Grigsby’s then-wife). In determining Mr. Grigsby’s ability to pay the
restitution judgment, the district court relied on a financial affidavit Mr. Grigsby
submitted to the United States Probation Office pursuant to 18 U.S.C. §
3664(d)(3). The affidavit, which was included in the Probation Office’s
Presentence Investigation Report (“PSR”), consisted of cash flow and net worth
statements in which Mr. Grigsby listed no current or expected assets. In light of
Mr. Grigsby’s claimed lack of assets, the court did not order any up-front,
lump-sum payment, instead ordering Mr. Grigsby to immediately begin monthly
installment payments of not less than ten percent of the funds in his inmate trust
fund account.
B
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Before the instant appeal, Mr. Grigsby had filed two other appeals
involving his restitution judgment; they do not directly pertain to the matters at
issue here. After those proceedings, the district court considered on remand the
government’s February 2016 motion, pursuant to the All Writs Act, 28 U.S.C.
§ 1651(a), for an order attaching Mr. Grigsby’s IBEW retirement account and
applying it to his restitution judgment. The district court granted the motion
pursuant to its authority under either 18 U.S.C. §§ 3664(k) or 3664(n), to revise
its restitution judgment. Mr. Grigsby appeals from this order.
Mr. Grigsby contends that the district court improperly amended its original
restitution order, which required only that Mr. Grigsby make monthly installment
payments of not less than ten percent of the funds in his inmate trust fund
account. More specifically, Mr. Grigsby argues that the court’s reliance on 18
U.S.C. §§ 3664(k) and 3664(n) to amend its restitution judgment was improper
and misplaced because (1) discovery of the retirement account does not constitute
a change in his economic circumstances, 18 U.S.C. § 3664(k), and (2) the
retirement account is not an “inheritance” or “settlement,” 18 U.S.C. § 3664(n).
Mr. Grigsby also contends that the monthly cash flow and net worth statements
that he executed prior to his sentencing—in which he failed to disclose his
interest in the retirement account—“should be viewed as moot” because they are
unreliable and therefore should not have been considered by the district court.
See Aplt.’s Opening Br. at 2–5. Mr. Grigsby’s overarching argument is that he
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should be allowed to place the retirement-account assets in a trust fund for his
children (one of whom is the minor victim in this case), which would be
administered by his mother, Carmelita Christensen. For the reasons noted below,
we reject Mr. Grigsby’s arguments.
II
Before turning to the merits of Mr. Grigsby’s appeal, we pause to address
his outstanding Objection to Appellee’s Motion to Supplement Record, which we
construe as a motion to strike from the record certain documents that the
government filed with this court. The supplemental record that the government
submitted consists of the parties’ various motions and the district court’s order
and opinion regarding the disposition of the retirement account. It also includes
Mr. Grigsby’s plea agreement and the original judgment that the district court
entered. Mr. Grigsby argues that these documents should be stricken from the
record because they are not relevant. Mr. Grigsby is incorrect. The documents
included in the supplemental record are either directly relevant to the order that
forms the basis of Mr. Grigsby’s appeal or provide useful context for that order.
Therefore, we deny Mr. Grigsby’s motion to strike the supplemental record. Cf.
United States v. Hernandez, 94 F.3d 606, 611 n.3 (10th Cir. 1996) (denying
motions to supplement the record because “consideration of this evidence is not
necessary to our decision”); United States v. Haddock, 50 F.3d 835, 841 n.4 (10th
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Cir. 1995) (denying motion to supplement the record because the proferred
materials were “neither necessary nor helpful to the resolution of [the] appeal”).
III
We next turn to the merits of Mr. Grigsby’s appeal. Mr. Grigsby asserts an
evidentiary argument and also a challenge to the district court’s statutory
interpretation of 18 U.S.C. §§ 3664(k) and 3664(n).
A
On appeal, Mr. Grigsby contends that the financial statements that make up
the financial affidavit that he was required to file before sentencing were
unreliable and that the district court should not have considered them.
Specifically, prior to being sentenced, Mr. Grigsby was required to provide a
financial affidavit to the United States Probation Office. See 18 U.S.C. §
3664(d)(3) (“Each defendant shall prepare and file with the probation officer an
affidavit fully describing the financial resources of the defendant, including a
complete listing of all assets owned or controlled by the defendant as of the date
on which the defendant was arrested . . . .”). The financial affidavit consisted of
two forms: (1) a net worth statement, and (2) a monthly cash flow statement. Mr.
Grigsby completed the affidavit and it was included in the PSR.
Mr. Grigsby’s challenge to the reliability of the two forms comprising the
financial affidavit comes much too late, however. Pursuant to Federal Rule of
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Criminal Procedure 32(f), Mr. Grigsby had fourteen days to object to any material
information contained within the PSR, including the financial affidavit. Fed. R.
Crim. P. 32(f) (“Within 14 days after receiving the presentence report, the parties
must state in writing any objections, including objections to material
information . . . contained in or omitted from the report.”). The final PSR was
filed on March 21, 2013, and Mr. Grigsby did, in fact, submit a number of timely
objections to the PSR; however, he did not lodge any objections challenging the
accuracy and reliability of the financial affidavit. See Defendant’s Objections to
Final PSR and Summary/Checklist of Objections, United States v. Grigsby, No.
6:12-CR-10174 (D. Kan. Mar. 22, 2013), ECF No. 58. 3 Consequently, the district
court never had an opportunity to consider Mr. Grigsby’s concerns regarding the
reliability of the financial affidavit included in the PSR. Furthermore, in his first
direct appeal, Mr. Grigsby challenged his sentence on procedural and substantive
reasonableness grounds, but again said nothing regarding the reliability of the
3
Neither Mr. Grigsby nor the United States (in its supplemental
record) included Mr. Grigsby’s PSR objections in their filings or in the record
before us. We may, however, take judicial notice of Mr. Grigsby’s earlier filings
to confirm that he did not previously raise his current objections to the PSR. See,
e.g., United States v. Ahidley, 486 F.3d 1184, 1192 n.5 (10th Cir. 2007) (“[W]e
may exercise our discretion to take judicial notice of publicly-filed records in our
court and certain other courts concerning matters that bear directly upon the
disposition of the case at hand.”); St. Louis Baptist Temple, Inc. v. FDIC, 605
F.2d 1169, 1172 (10th Cir. 1979) (“[F]ederal courts, in appropriate circumstances,
may take notice of proceedings in other courts, both within and without the
federal judicial system . . . .”).
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information in the financial affidavit. See United States v. Grigsby (Grigsby I),
749 F.3d 908 (10th Cir. 2014), cert. denied, 135 S. Ct. 214 (2014).
Mr. Grigsby does not address here his untimely presentation of this
evidentiary issue. In particular, he offers nothing that would dissuade us from the
seemingly patent conclusion that Mr. Grigsby’s opportunity to challenge the
accuracy and reliability of his financial affidavit passed more than three years ago
and that this issue is therefore waived. In this regard, we have declined to
consider appellate challenges not raised in a prior appeal when they could have
been so raised. See United States v. Gama-Bastidas, 222 F.3d 779, 784 (10th Cir.
2000) (“Ordinarily, we will not review in a second direct appeal an issue that
underlies a previously affirmed conviction.”); see also United States v. Webb, 98
F.3d 585, 589 (10th Cir. 1996) (explaining that “the limited scope of
the . . . remand did not provide the court with authority to review defendant’s
renewed objection to enhancement. This issue was not appealed by defendant in
[the first appeal]; therefore, the district court’s initial ruling on the enhancement
became final. Thus, the district court did not err in declining to address
defendant’s objections at the time of resentencing.” (citation omitted)).
Though improbable, at best, Mr. Grigsby’s objections to the reliability of
the information in his financial affidavit—having not been raised before the
district court in the instant case—could be deemed forfeited, rather than waived.
See, e.g., United States v. Cruz-Rodriguez, 570 F.3d 1179, 1183 (10th Cir. 2009)
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(“distinguish[ing] between issues involving waiver, which do not receive
appellate review, and those involving forfeiture, which we review for plain
error”); United States v. Carrasco-Salazar, 494 F.3d 1270, 1272 (10th Cir. 2007)
(“Waiver is different from forfeiture. Whereas forfeiture is the failure to make
the timely assertion of a right, waiver is the ‘intentional relinquishment or
abandonment of a known right.’” (quoting United States v. Olano, 507 U.S. 725,
733 (1993))); see also Ian S. Speir & Nima H. Mohebbi, Preservation Rules in the
Federal Courts of Appeals, 16 J. OF A PP . P RAC . & P ROC . 281, 284 (2015) (“Unlike
a waived argument, a forfeited argument may be grounds for reversal on appeal,
but only if affirming the district court would result in plain error.”). But, if so,
Mr. Grigsby’s failure to address the untimeliness of his objections through a
plain-error argument effectively leads us to the same place—viz., we will decline
to consider the objections. See, e.g., Richison v. Ernest Grp., Inc., 634 F.3d 1123,
1131 (10th Cir. 2011) (“[T]he failure to argue for plain error and its application
on appeal . . . surely marks the end of the road for an argument for reversal not
first presented to the district court.”). 4
B
4
Mr. Grigsby also briefly argues that the monthly cash flow and net
worth statements “do not qualify as an affidavit” for purposes of 18 U.S.C.
§ 3664(d)(3). Aplt.’s Opening Br. at 5. As with Mr. Grigsby’s challenges to the
reliability of the information in these statements, this argument is waived or
otherwise not preserved for our consideration.
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We next turn to Mr. Grigsby’s statutory arguments. The district court held
that 18 U.S.C. §§ 3664(k) and 3664(n) provided alternative grounds on which it
could rely to alter its restitution judgment and issue an order, pursuant to 28
U.S.C. § 1651(a), requiring IBEW Local No. 661 to liquidate the retirement
account and pay the proceeds to the clerk of the court for application to Mr.
Grigsby’s amended restitution judgment. Because we conclude that the district
court correctly held that the discovery of the concealed retirement account
qualified as a change in economic circumstances for purposes of 18 U.S.C.
§ 3664(k), we affirm the district court’s order on this ground and need not reach
Mr. Grigsby’s § 3664(n) argument.
A district court has discretion to modify an order of restitution when there
is a “material change in the defendant’s economic circumstances that might affect
the defendant’s ability to pay restitution.” 18 U.S.C. § 3664(k). A change is
material if it affects—negatively or positively—the defendant’s ability to pay
restitution. See Grigsby II, 579 F. App’x at 684 (citing Cani v. United States, 331
F.3d 1210, 1215 (11th Cir. 2003)). Such a material change may be brought to the
court’s attention by (1) the defendant, (2) the government, or (3) the victim. 18
U.S.C. § 3664(k); see United States v. Grant, 235 F.3d 95, 100 (2d Cir. 2000).
The court may thereafter modify an order of restitution based on this change to
the defendant’s economic circumstances either sua sponte or on the motion of any
party or the victim. 18 U.S.C. § 3664(k); see also Grant, 235 F.3d at 100.
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Finally, before the district court adjusts the payment schedule, the Attorney
General must certify to the court that the victim has been notified of the
defendant’s changed circumstances. 18 U.S.C. § 3664(k); see also Grant, 235
F.3d at 100.
Here, the government filed a notice informing the court that it believed Mr.
Grigsby’s economic circumstances had materially changed since sentencing. The
government also moved for an order modifying the restitution judgment, which
the district court entered only after it received the required certification from the
government that the victim had been notified of Mr. Grigsby’s changed
circumstances. Thus, the only issue before us here is whether the district court
erred in its legal conclusion that Mr. Grigsby’s economic circumstances had
materially changed, such that it had discretion to modify the judgment pursuant to
§ 3664(k).
Mr. Grigsby contends that the court changed his economic circumstances
by ordering the liquidation of his retirement account. While not expressly stated,
this argument implies that Mr. Grigsby believes his economic circumstances had
not materially changed prior to the district court’s order, as required for § 3664(k)
to apply. He also asserts that he “has not tried to recover any monies” from the
account but instead has attempted to roll it over into a trust fund for his children
(one of whom is the minor victim owed restitution). Aplt.’s Opening Br. at 7–8.
As an initial matter, Mr. Grigsby’s arguments regarding his abstention from
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withdrawing funds from the account and his desire to create a trust fund are
irrelevant; they do not speak to the issue at hand—viz., whether discovery of the
previously concealed retirement account constitutes a material change in his
economic circumstances.
Turning to that issue, we have not had occasion to address the application
of § 3664(k) to circumstances such as these: that is, when a defendant misleads
the court at the time of sentencing by not revealing all of his or her assets. 5 One
5
The district court found that Mr. Grigsby “failed to comply with the
statute [18 U.S.C. § 3664(d)(3)], and misled the court at the time of sentencing.”
Aplee.’s Supp. R. at 69. Mr. Grigsby has offered no compelling evidence or
argument to upset this ruling and it is not clearly erroneous. Mr. Grigsby argues
that the cash flow and net worth statements are not “mandatory” documents
because both documents “use the phrase, ‘should include assets or debts.’”
Aplt.’s Opening Br. at 3 (emphasis added). This quote, however, is taken out of
context and distorts the import of the documents. First of all, the instructions
accompanying the cash flow and net worth statements expressly reference
§ 3664(d)(3); that statute’s plain terms speak in mandatory language and leave no
room for doubt that a defendant “shall” disclose on the probation office forms
“all assets owned or controlled by the defendant.” 18 U.S.C. § 3664(d)(3)
(emphases added). And, read in a broader context, the language quoted by Mr.
Grigsby simply is intended to “clarify” that the comprehensive command to
disclose all “assets owned, jointly owned, or controlled by a defendant” “should
include assets or debts that are yours alone,” but is not limited to same. Aplt.’s
Opening Br., Ex. 1, at 1 (emphasis added); id., Ex. 2, at 1 (emphasis added).
Indeed, the net worth statement does not limit in any way the assets that must be
disclosed and even specifically lists the asset at issue here—an interest in a
pension plan—as an example. See Aplt.’s Opening Br., Ex. 2, at 4 (“Net Worth
Statement”) (“ANTICIPATED ASSETS (Include any assets you expect to
receive or control from lawsuits for compensation or damages, profit sharing,
pension plans, inheritance, wills, or as an executor or administrator of any
succession or estate.)”) (second emphasis added). Accordingly, Mr. Grigsby’s
suggestion that the cash flow and net worth statements’ disclosure directives were
permissive, and not mandatory, borders on the fatuous.
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of our sister circuits has held that “a court’s later understanding that it had
sentenced a defendant ‘without full knowledge of [his] assets’” cannot “alone
constitute[] a material change in economic circumstances.” Grant, 235 F.3d at
100 (emphasis added). The Grant court, however, was careful to limit its holding
to the facts before it, noting that “the district court made no finding as to whether
[the defendant] concealed or failed to report assets . . . . Surely . . . there would
be a remedy that would permit the gathering of assets that were unknown to the
authorities as the result of a defendant’s dishonesty.” Id. (emphasis added); see
also United States v. Roush, 452 F. Supp. 2d 676, 681 n.6 (N.D. Tex. 2006)
(“Discovery of previously unknown or hidden assets would . . . constitute a
change in the defendant’s economic circumstances that could justify modification
under section 3664(k), as it would be a change in the economic circumstances
presented to the court at sentencing.”); cf. United States v. Foreman-Pottinger,
No. 09-023, 2009 WL 3347116, at *2 n.1 (E.D. La. Oct. 14, 2009) (refusing to
modify restitution under § 3664(k) where government had full knowledge of
defendant’s assets during sentencing and did not later discover “any previously
unknown or hidden assets”).
This case presents the exact scenario that the Second Circuit contemplated
in Grant. Notably, the district court made the very finding that was lacking in
Grant, namely, that Mr. Grigsby knowingly concealed his primary asset from the
court in the financial affidavit that he submitted pursuant to 18 U.S.C.
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§ 3664(d)(3). Mr. Grigsby was required to provide the district court with a
complete disclosure of his financial assets so that the court could determine his
ability to pay restitution. Mr. Grigsby bore the burden of establishing his
resources or lack thereof. See 18 U.S.C. § 3664(e) (“The burden of demonstrating
the financial resources of the defendant and the financial needs of the defendant’s
dependents, shall be on the defendant.”). In his financial affidavit, Mr. Grigsby
claimed he had no assets, but now concedes that “[t]he retirement account existed
at the time of [his] criminal proceedings.” 6 Aplt.’s Opening Br. at 6. Thus,
where, as here, the court finds that a defendant failed to disclose (or knowingly
concealed) assets at sentencing that would affect his ability to pay restitution, on
later discovery of those assets, the court may modify its order of restitution as the
interests of justice require pursuant to 18 U.S.C. § 3664(k). The court therefore
was authorized to do so here, and we find no error in its action.
IV
For the foregoing reasons, we deny Mr. Grigsby’s motion to strike the
supplemental record submitted by the United States and affirm the district court’s
6
While acknowledging that the retirement account existed at the time
of sentencing, Mr. Grigsby argues that it was not an asset at that time. As an
initial matter, Mr. Grigsby has offered no support for this position other than his
assertion that he had not “received any monies” from the account. Aplt.’s
Opening Br. at 6. Even if Mr. Grigsby is correct, this distinction is irrelevant.
The net worth statement required Mr. Grigsby to list not just current assets, but
anticipated assets, and it expressly listed pension plans as an example of just such
an asset. See id., Ex. 2, at 4; see also supra note 5.
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order requiring IBEW Local No. 661 to liquidate Mr. Grigsby’s retirement
account and pay the proceeds to the clerk of the court for application to his
restitution judgment.
Entered for the Court
JEROME A. HOLMES
Circuit Judge
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