United States v. Shuster

08-1182-cr
USA v. Shuster
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
Rulings by summary order do not have precedential effect. Citation to a summary order
filed on or after January 1, 2007, is permitted and is governed by Federal Rule of Appellate
Procedure 32.1 and this court’s Local Rule 32.1.1. When citing a summary order in a document
filed with this court, a party must cite either the Federal Appendix or an electronic database
(with the notation “summary order”). A party citing a summary order must serve a copy of it
on any party not represented by counsel.
At a stated term of the United States Court of Appeals for the Second Circuit, held at
the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New
York, on the 19th day of January, two thousand and ten.
PRESENT:
GUIDO CALABRESI,
JOSÉ A. CABRANES,
BARRINGTON D. PARKER,
Circuit Judges.
-------------------------------------------x
UNITED STATES OF AMERICA ,
Appellee,
v. No. 08-1182-cr
BORIS SHUSTER, also known as Robert Shuster,
Defendant-appellant,
ALEXANDER DZEDETS, also known as Sasha Dzedets, VICTOR
ALTMAN , VINCENT C. ARMATO , IGOR G. KOMET, also known
as Gary Komet, ADAM LICHTENBAUM , DAVID LOZOVSKY ,
LARRY SHUSTER, BORIS TAGER, PETER RORRALES JR .,
Defendants.*
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
*
The Clerk of Court is directed to amend the official caption in this case to conform to the
listing of the parties above.
1
FOR APPELLANT: Howard M. Simms, New York, NY.
FOR APPELLEE: Preet Bharara, United States Attorney, and Andrew L. Fish and
Marc O. Litt, Assistant United States Attorneys, United States
Attorney’s Office, Southern District of New York, New York,
NY.
Appeal from a February 20, 2008 judgment of conviction entered by the United States District
Court for the Southern District of New York (Victor Marrero, Judge).
UPON CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of the District Court is VACATED and the cause is
REMANDED for re-sentencing.
In the United States District Court for the Eastern District of New York, appellant Boris
Shuster pleaded guilty to charges stemming from mail fraud perpetrated under the auspices of a
fraudulent investment firm called the A.S. Templeton Group (“AST”). Appellant received a 60-month
sentence for the AST fraud convictions. The AST fraud convictions are relevant to—but not the
subject of—this appeal.
Later, in the United States District Court for the Southern District of New York, appellant
pleaded guilty to separate charges related to a fraudulent investment scheme involving the use of an
investment firm called Holston, Young, Parker & Associates (“Holston”). Judge Marrero imposed on
appellant a 150-month sentence for the Holston fraud convictions. Appellant challenges that sentence
in this appeal.
I. Considering the AST Fraud for the Purpose of Determining the Relevant Conduct
Appellant first argues that the 150-month sentence for the Holston fraud was “unreasonable”
because it exceeded the 60-month sentence imposed for the AST fraud and because the District Court
considered the AST fraud as “relevant conduct” for the sentence it imposed for the Holston fraud.
These arguments are meritless. A district court may consider all relevant conduct in calculating
an offense level under United States Sentencing Guidelines (“U.S.S.G.”) § 1B1.3, even if the conduct
has already been considered as relevant conduct in imposing a sentence for a prior prosecution. See
Witte v. United States, 515 U.S. 389, 399 (1995); United States v. Gallego, 191 F.3d 156, 169-70 (2d Cir.
1999), abrogated on other grounds by Crawford v. Washington, 541 U.S. 36, 64-65 (2004). To the extent that
the 150-month sentence for the Holston fraud partially “resulted from” the AST fraud—which was
deemed “another offense that [was] relevant conduct to the instant offense of conviction”—the
District Court properly provided that the 150-month sentence for the Holston fraud would run
concurrently with the 60-month sentence for the AST fraud. See U.S.S.G. § 5G1.3(b).
2
II. Considering the AST Fraud for the Purpose of Calculating Appellant’s Criminal History
Category
The government argued to Judge Marrero that the AST fraud should be considered both (1) as
“relevant conduct” in determining appellant’s offense level under U.S.S.G. § 1B1.3 and (2) as a “prior
sentence” for the purpose of determining appellant’s criminal history category. Judge Marrero
accepted the government’s argument and considered the AST fraud both as “relevant conduct” and as
a “prior sentence.”
On appeal, the government now concedes that its position to Judge Marrero was a mistake, that
Judge Marrero thus erred, and that this case should be remanded for re-sentencing. As the government
states in its brief, “a sentence for conduct that is relevant conduct under Section 1B1.3 does not result
in criminal history points.” Gov’t Br. 18; see also U.S.S.G. § 4A1.2 cmt. n.1 (“‘Prior sentence’ means a
sentence imposed prior to sentencing on the instant offense, other than a sentence for conduct that is part of
the instant offense.” (emphasis added)); United States v. Thomas, 54 F.3d 73, 83 (2d Cir. 1995).
Accordingly, appellant’s sentence is vacated and remanded to the District Court for
re-sentencing consistent with this order.
III. Additional Issues
On September 29, 2009, this Court ordered the parties to brief two additional issues that
appellant did not argue before the District Court or in his briefs to this Court. We now conclude that
neither issue raised in the September 29, 2009 order implicates an error on the part of the District
Court.
First, Application Note 3(E)(ii) to U.S.S.G. § 2B1.1 does not apply in this case. That
Application Note applies only to an offense “involving collateral pledged or otherwise provided by the
defendant.” We are unaware of any precedent for treating the kind of investment fraud that appellant
was involved in—essentially a Ponzi scheme—as a fraud involving “collateral pledged or otherwise
provided.”
Additionally, appellant argues that he is entitled to a credit against loss under Application Note
3(E)(i) to U.S.S.G. § 2B1.1, which provides that loss is to be reduced by “[t]he money returned, and the
fair market value of the property returned and the services rendered, by the defendant or other persons
jointly with the defendant, to the victim before the offense was detected.” This argument is of no avail
since the District Court applied a twenty-level enhancement for losses greater than $7 million but less
than $20 million. The total loss amount, which includes losses caused by the Holston fraud and
appellant’s other relevant conduct, exceeds $7 million regardless of whether appellant receives a Note
3(E)(i) credit against loss for funds returned to the Holston fraud victims.
3
Second, the Ex Post Facto Clause of the United States Constitution does not prohibit the
application of the November 1, 2007 version of the Sentencing Guidelines to appellant’s fraudulent
conduct. Ordinarily, a sentencing court “appl[ies] the version of the Guidelines in effect on the date of
the defendant’s sentencing.” United States v. Kilkenny, 493 F.3d 122, 126 (2d Cir. 2007). Even assuming,
without deciding, that following United States v. Booker, 543 U.S. 220 (2005), the Ex Post Facto Clause
applies to amendments to the Sentencing Guidelines, see United States v. Johnson, 558 F.3d 193, 194 n.1
(2d Cir. 2009), the Ex Post Facto Clause would require the application of the Guidelines regime in place
on the last date of the offense only where the Guidelines in effect at the time of sentencing would
compel a more severe penalty, Kilkenny, 493 F.3d at 126-27. The Holston fraud occurred between June
2002 and March 2003; thus the November 1, 2002 edition of the Guidelines, as amended by the
January 25, 2003 Supplement, was in effect on the last date of the Holston fraud. As the November 1,
2007 Guidelines and the November 1, 2002 Guidelines, as amended, are identical in all respects
relevant to this case, the District Court correctly used the November 1, 2007 Guidelines to calculate
appellant’s sentencing range.
* * *
We have considered appellant’s remaining arguments on appeal and find them to be meritless.
CONCLUSION
For the foregoing reasons, the sentence imposed by the February 20, 2008 judgment of
conviction is VACATED, and the cause is REMANDED to the District Court for re-sentencing
consistent with this order.
FOR THE COURT,
Catherine O’Hagan Wolfe, Clerk of Court
By _______________________________
4