United States v. Payne

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 04-4508
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
ELIZABETH A. PAYNE,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. T. S. Ellis, III, District
Judge. (CR-04-91)
Submitted: February 2, 2005 Decided: March 4, 2005
Before NIEMEYER, MOTZ, and GREGORY, Circuit Judges.
Affirmed in part, vacated in part, and remanded by unpublished per
curiam opinion.
Jeffrey D. Zimmerman, LAW OFFICE OF JEFFREY D. ZIMMERMAN,
Alexandria, Virginia, for Appellant. Paul J. McNulty, United
States Attorney, Charles F. Connolly, Assistant United States
Attorney, Alexandria, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Elizabeth A. Payne pled guilty without a plea agreement to an
information charging her with embezzlement, 18 U.S.C. § 656 (2000),
and was sentenced to a term of eighteen months imprisonment. Payne
appeals her sentence, alleging that the district court erred in
determining the amount of loss, U.S. Sentencing Guidelines Manual
§ 2B1.1(b)(1)(F) (2001), and in failing to recognize its authority
to depart downward for extraordinary restitution under Application
Note 15(B) to § 2B1.1 and USSG § 5K2.0, p.s. Payne also contests
the two-level adjustment for abuse of a position of trust she
received under USSG § 3B1.3, and contends that her sentence was
imposed in violation of the Sixth Amendment right to jury trial
because the sentence enhancements were based on judicial fact
findings in violation of the rule set out in Blakely v. Washington,
124 S. Ct. 2531 (2004). We affirm the district court’s initial
calculation of the guideline range, but we vacate the sentence in
light of United States v. Booker, 125 S. Ct. 738 (2005), and remand
for resentencing.
In June 2002, Payne was the item processing supervisor at the
Fauquier Bank in Warrenton, Virginia. Payne stole a check from her
mother’s checkbook, made it out to herself for $160,000, and
deposited the check in her own account at the Fauquier Bank. Later
that day, Payne removed the check from a bundle of checks that were
to be sent to the Federal Reserve Bank for processing to prevent
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her mother’s account at a different bank from being debited the
$160,000. However, the Federal Reserve Bank notified the Fauquier
Bank that it was accountable for the missing $160,000 draft.
In August 2002, after Payne’s supervisor notified her that the
bank would need a replacement check for the still-missing $160,000
check, Payne took another check from her mother’s checkbook, again
made it out to herself for $160,000, and gave it to the Fauquier
Bank. She again removed this check from the bundle of checks that
were sent to the Federal Reserve Bank. Finding another check in
that day’s bundle for $160,000, Payne photocopied the Fauquier
Bank’s indemnification from the back of her fraudulent check to the
back of the legitimate check in an attempt to disguise her fraud.
Payne was not successful; the Federal Reserve Bank notified the
Fauquier Bank that a second item was missing.
After an internal investigation, Payne was placed on
administrative leave. The next day, she confessed to her employer
that she had taken the $160,000 check and that she had tried to
conceal her theft by using her position as item processing
supervisor in the proof department. Subsequently, the bank
received $126,000 from Payne, mainly proceeds from the sale of her
house. The bank’s actual loss was $26,791.82.
At Payne’s sentencing, the district court calculated the
guideline range by applying a base offense level of 6 under USSG
§ 2B1.1(a), a 10-level enhancement for a loss of $160,000 under
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subsection (b)(1)(F) (loss between $120,000 and $200,000), a 2-
level adjustment for abuse of a position of trust under USSG
§ 3B1.3, and a 3-level adjustment for acceptance of responsibility.
The resulting recommended final offense level was 15. Because
Payne was in criminal history category I, the guideline range was
18-24 months. The district court imposed a sentence of eighteen
months imprisonment.
Payne argues on appeal that (1) the district court erred in
deciding not to reduce the amount of loss by the amount she had
repaid the bank by the time of sentencing; (2) the court failed to
recognize its authority to depart downward for extraordinary
restitution; and (3) the court enhanced her sentence for abuse of
a position of trust in violation of the rule set out in Blakely.
In Booker, the Supreme Court held that the federal sentencing
guidelines mandatory scheme which provides for sentence
enhancements based on facts found by the court violated the Sixth
Amendment; the Court remedied the constitutional violation by
severing and excising the statutory provisions that mandate
sentencing and appellate review under the guidelines, thus making
the guidelines advisory. United States v. Hughes, ___ F.3d ___,
2005 WL 147059, at *3 (4th Cir. Jan. 24, 2005) (citing Booker,
Opinion of Justice Stevens for the Court at 20, Opinion of Justice
Breyer for the Court at 2). In Hughes, we held that a sentence
that is enhanced based on facts found by the court, not by a jury
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or admitted by the defendant, constitutes plain error that affects
the defendant’s substantial rights and warrants reversal under
Booker. 2005 WL 147059, at *2-4 (citing United States v. Olano,
507 U.S. 725, 731-32 (1993)).
Payne’s sentence was enhanced by ten levels for an intended
loss of $160,000, § 2B1.1(b)(1)(F), a fact she did not admit, and
by two levels for abuse of a position of trust, § 3B1.3, a fact the
court found by adopting the recommendations in the presentence
report. In light of Booker and Hughes, we find that the district
court plainly erred in determining the amount of loss and imposing
a sentence that exceeded the maximum allowed based on facts
admitted by Payne alone.1 However, we conclude that the court’s
initial calculation of the guideline range was correct.
The district court’s interpretation of the term “loss,” as
used in the guidelines, is reviewed de novo; its calculation of the
loss under the correct interpretation is reviewed for clear error.
Hughes, 2005 WL 147059, at *6 (citing United States v. Miller, 316
F.3d 495, 498 (4th Cir. 2003)). Application Note 2(E)(ii) to
§ 2B1.1 provides that, “[i]n a case involving collateral pledged or
1
Although Payne raised Blakely in her motion for release
pending appeal, filed within seven days of sentencing, we conclude
that she did not thereby preserve the issue for appeal. At that
point, the district court was without authority to alter the
sentence except for arithmetical, technical, or other clear error.
Fed. R. Crim. P. 35(a). The constitutional error in Payne’s
sentence became “clear” only with the Supreme Court’s decision in
Booker. See Hughes, 2005 WL 147059, at *4 (“Booker has now
abrogated our previously settled law.”).
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otherwise provided by the defendant,” the amount of loss “shall be
reduced” by “the amount the victim has recovered at the time of
sentencing from disposition of the collateral, or if the collateral
has not been disposed of by that time, the fair market value of the
collateral at the time of sentencing.”
Payne argues that her house was “collateral pledged or
otherwise provided” by her on September 12, 2002, when she stated
in an email to the bank president, “I will gladly give my house for
collateral until you get the money,” and September 3, 2002, when
she signed the home over to the bank. We disagree. Payne did not
give the bank an interest in her house as part of her offense;
instead, she turned it over to the bank as part of her effort to
make restitution for the offense once it had been discovered. See
United States v. Scott, 74 F.3d 107, 112 (6th Cir. 1996)
(subsequent voluntary restitution is not the same as posting
collateral). Therefore, the district court did not err in
concluding that she was not entitled to a credit against the
intended loss for the amount the bank recovered from the sale of
her house.
Payne next argues that the district court failed to recognize
its authority to depart for extraordinary restitution, see USSG
§§ 2B1.1, cmt. n.15(B), 5K2.0, p.s. The sentencing court’s
discretionary decision not to depart is not reviewable unless the
court’s decision is based on a mistaken belief that it lacks
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authority to depart. United States v. Wood, 378 F.3d 342, 351 n.8
(4th Cir. 2004). Application Note 15(b) to § 2B1.1 states that, in
a case where the offense level “substantially overstates the
seriousness of the offense,” a downward departure may be warranted.
Our review of the court’s ruling on Payne’s departure motion
convinces us that the court recognized its authority to depart and
exercised its discretion not to depart. Payne’s argument that the
court mistakenly believed it lacked authority to depart is based on
several comments by the court which, when viewed in light of the
record as a whole, do not support her assertion. We conclude that
Payne has not shown that the court’s decision not to depart was
made in the mistaken belief that it lacked authority to do so.
Finally, Payne argues that the district court erred under
Blakely in making an adjustment for abuse of a position of trust,
since she did not admit that fact.
In light of Booker and Hughes, we conclude that the district
court plainly erred in imposing a sentence that included
enhancements based on facts found by the court and thus exceeded
the maximum allowed based on the facts admitted by Payne alone. We
therefore affirm the district court’s initial calculation of the
guideline range, but we vacate the sentence imposed by the district
court and remand for resentencing consistent with Hughes. We
dispense with oral argument because the facts and legal contentions
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are adequately presented in the materials before the court and
argument would not aid the decisional process.
AFFIRMED IN PART,
VACATED IN PART, AND REMANDED
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