United States v. Jeffrey Gunselman

Case: 13-10409 Document: 00513458034 Page: 1 Date Filed: 04/08/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 13-10409 United States Court of Appeals
Fifth Circuit
FILED
UNITED STATES OF AMERICA, April 8, 2016
Lyle W. Cayce
Plaintiff - Appellee Cross-Appellant Clerk
v.
JEFFREY DAVID GUNSELMAN, Individually, doing business as Absolute
Fuels, L.L.C.,
Defendant - Appellant Cross-Appellee
Appeals from the United States District Court
for the Northern District of Texas
USDC No. 5:12-CR-78
Before HIGGINBOTHAM, SOUTHWICK, and HIGGINSON, Circuit Judges.
PER CURIAM:*
Jeffrey Gunselman appeals his conviction and sentence for wire fraud,
money laundering, and violations of the Clean Air Act, alleging several
interrelated constitutional violations below. He also claims that his guilty plea
was not knowing and voluntary, that the court erred in calculating the loss
amount underlying his sentence and restitution obligation, and that the court
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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erroneously enhanced his sentence. The government cross-appeals to correct
an error in the written judgment. We VACATE the offset condition in the
written judgment below, and AFFIRM in all other respects.
I
Federal law requires energy companies producing or importing fossil
fuels to introduce a certain amount of renewable fuels, such as corn-based
ethanol and other biodiesels, into the fuel supply each year. They can do this
by purchasing renewable fuel credits from companies that produced renewable
fuels. These credits are called Renewable Identification Numbers, or RINs.
Gunselman represented to the EPA and to fuel companies seeking to purchase
RINs that he manufactured renewable fuels when, in fact, he did not. Between
January 2010 and October 2011, Gunselman produced no commercially usable
renewable fuel, but he sold over 46 million RINs for more than $40 million. He
admitted he “falsely represented that he was in the business of producing bio-
diesel fuel, although he did not produce any bio-diesel fuel that met the bio-
diesel fuel standard tests and that was accepted by a purchaser,” and that “his
business operation consisted solely of falsely generating RINs and marketing
them to brokers and oil companies.”
Gunselman was indicted on and ultimately pled guilty to seventy-nine
counts, including fifty-one counts of wire fraud, twenty-four counts of money
laundering, and four counts of making a false statement under the Clean Air
Act. His plea included the following provision:
Except as otherwise provided, Gunselman hereby expressly waives
the right to appeal his conviction and/or sentence on any ground,
including any appeal right conferred by 18 U.S.C. § 3742, and
Gunselman further agrees not to contest his conviction and/or
sentence in any post-conviction proceeding, including, but not
limited to, a proceeding under 18 U.S.C. §§ 2241 and 2255.
Gunselman, however, reserves the right to appeal the following:
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(a) any punishment imposed in excess of the statutory maximum,
and (b) any claim based on ineffective assistance of counsel.
Gunselman also stipulated that his misconduct caused $41,762,236.87
in losses, and agreed that
[n]otwithstanding this stipulation regarding the loss amount,
Gunselman fully understands that he will not be allowed to
withdraw his plea of guilty if, after a presentence report has been
prepared, the amount of loss is found to be higher than the above-
stated amount. Gunselman understands that the above-referenced
stipulation is not binding upon the Court or upon the probation
office, and he will not be allowed to withdraw his guilty plea should
the stipulation not be followed by the Court.
After an uneventful plea hearing, elements of which are described in
greater detail below, the judge accepted Gunselman’s plea and ordered a
presentence investigation. The resulting presentence report (“PSR”) calculated
that Gunselman had in fact caused $58,301,877.55 in losses, most of which
were incurred when his victims, fuel producers or importers who purchased
fraudulent RINs from Gunselman, were forced to buy valid RINs to replace
them. It determined that Gunselman’s offense level was 34 and his criminal
history category was I, yielding a guideline sentence range of 151 to 188
months. 1 Finally, it calculated that Gunselman owed over $53 million in
restitution to his victims pursuant to 18 U.S.C. § 3663A; a subsequent
addendum adjusted this sum upward to $54,973,137.50.
Gunselman objected to the PSR’s loss calculation, sentence calculation,
and restitution analysis. The judge overruled the objections, sentenced him to
188 months in prison, and ordered him to pay $54,973,137.50 in restitution
pursuant to the Mandatory Victims Restitution Act (MVRA). 2
1 The PSR indicated that if the loss amount were found to match the one stipulated in
the plea agreement, Gunselman’s guideline sentence range would be 121 to 151 months.
2 Specifically, following the PSR’s analysis, the judge sentenced Gunselman to 188
months for the wire fraud counts, 120 months for the money laundering counts, and 24
3
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Gunselman now appeals his plea and sentence. In addition, the
government appeals the district judge’s order that Gunselman’s restitution “be
offset by funds already seized and in the hands of the Government, as well as
any additional funds garnered by the Government from loan payments, sale of
items, and any other cash flows.” The district judge included this provision in
his written judgment, apparently mistakenly, and then tried to rescind it on
the government’s motion pursuant to Rule 35(a), but his attempt to amend was
untimely. 3
II
Gunselman’s fourteen purported points of error can be condensed into a
handful of distinct claims. We address each in turn, beginning with his
challenge to the validity of his plea. 4 A guilty plea must be knowing and
voluntary to be enforced. 5 To that end, Rule 11 of the Federal Rules of Criminal
Procedure sets forth procedures for the district judge to follow in reviewing a
plea with a defendant. 6 Gunselman argues that his plea hearing was
inadequate, that he did not voluntarily and knowingly plead guilty, and that
the plea and the appellate waiver it contained cannot be enforced. We review
these questions de novo. 7
Gunselman’s plea agreement listed each of the rights he was forfeiting
by entering into the agreement and the maximum penalties for each count. By
signing the agreement, Gunselman represented that the plea was “freely and
months for the false statement counts, each to run concurrently, for a total sentence of 188
months.
3 See discussion infra notes 40-43 and accompanying text.
4 Gunselman also raised a host of new issues in his reply brief (which doubles as a
response to the government’s cross-appeal). They are waived. See Casas v. American Airlines,
Inc., 304 F.3d 517, 526 (5th Cir. 2002); Cinel v. Connick, 15 F.3d 1338, 1345 (5th Cir. 1994).
5 See Boykin v. Alabama, 395 U.S. 238, 244 (1969).
6 See FED. R. CRIM. P. 11(b); United States v. Vonn, 535 U.S. 55, 62 (2002).
7 United States v. Baymon, 312 F.3d 725, 727 (5th Cir. 2002); United States v. Amaya,
111 F.3d 386, 388 (5th Cir. 1997).
4
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voluntarily made and [was] not the result of force or threats, or of promises
apart from those set forth in this Plea Agreement.” He admitted that he had
reviewed all legal and factual aspects of his case with his attorney and was
satisfied with his legal representation, and that his attorney had satisfactorily
explained to him each paragraph of the plea agreement, all of his rights
affected by the plea agreement, and the alternatives available to him other
than pleading guilty. He acknowledged that it was “in his best interest to enter
into this plea agreement and all its terms.”
At the plea hearing, the Government read the entire indictment in open
court, and Gunselman acknowledged that he understood the allegations in the
indictment. He also confirmed that he had read over and signed the plea
agreement and understood and agreed to its terms and conditions. The court
specifically asked whether he understood that he was waiving the right to
appeal except for very limited reasons, and Gunselman said that he did. He
acknowledged that he was forfeiting the right to a jury trial, that he was
pleading guilty because he was guilty, and that his plea was not “the result of
any force, threats, or promises on behalf of the government.”
The court reviewed the statutory maximum penalties for each offense,
and it explained that the guidelines were advisory only and that the court could
impose a sentence up to the statutory maximum. Gunselman stated that he
understood. The court asked if Gunselman had read the factual resume and
whether it accurately reflected the facts on which his guilty plea was based,
and Gunselman responded in the affirmative. The court then inquired, “After
reviewing your rights, the nature of the charges presented, and the potential
penalties, do you still wish to plead guilty to this indictment?” Gunselman
replied in the affirmative. The district court found that Gunselman was “fully
competent and capable of entering an informed plea and that his plea of guilty
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is a knowing and voluntary plea supported by an independent basis in fact
containing each of the essential elements of the offenses charged.”
These facts show that Gunselman’s plea was knowing and voluntary and
that the district judge fulfilled Rule 11 in reviewing it with him. We recently
described the knowing-and-voluntary standard as follows:
To enter a knowing and voluntary guilty plea, the defendant must
have a “full understanding of what the plea connotes and of its
consequence.” The defendant must have notice of the nature of the
charges against her, she must understand the consequences of her
plea, and must understand the nature of the constitutional
protections she is waiving. For a guilty plea to be voluntary, it
must “not be the product of ‘actual or threatened physical harm, or
... mental coercion overbearing the will of the defendant’ or of state-
induced emotions so intense that the defendant was rendered
unable to weigh rationally his options with the help of counsel.” 8
Gunselman does not claim coercion, and the record shows that he
received the requisite notice and understood the relevant consequences and
protections to be waived. His plea, and the appellate waiver he executed as
part of it, are therefore enforceable absent some other invalidating defect. 9
III
Gunselman further alleges that his indictment was duplicitous and that
the duplicity undermines his sentence and conviction in several ways. 10
8 United States v. Urias-Marrufo, 744 F.3d 361, 366 (5th Cir. 2014) (quoting Boykin,
395 U.S. at 244, and Matthew v. Johnson, 201 F.3d 353, 365 (5th Cir. 2000)).
9 In an attachment to his appellate brief, Gunselman claims that he was “on mind-
altering drugs” when he pled guilty. Nothing in the record supports this claim, and it is
waived in any case because it was not included in the brief. See United States v. Thames, 214
F.3d 608, 611 n.3 (5th Cir. 2000). Gunselman also argues that the district judge should have
offered a more elaborate plea hearing because his case had been designated “complex” for
purposes of the Speedy Trial Act. However, he cites no authority for the notion that such a
designation triggers additional obligations under Rule 11, and we have found none. Also,
Gunselman’s case was declared “complex” because of the extent and quality of the relevant
evidence, not because the charges he faced were especially complicated.
10 A duplicitous indictment “improperly joins two or more offenses in . . . single
count[s].” United States v. Lampazianie, 251 F.3d 519, 525 (5th Cir. 2001).
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Specifically, he claims that certain wire fraud counts in the indictment were
duplicitous and therefore invalid; that because of this, the money laundering
counts in the indictment, which derived from the wire fraud counts, were also
invalid; that the judgment and plea agreement, which relied on the indictment,
were also invalid; that the duplicity resulted in a higher sentence and
restitution obligation than were warranted; that his counsel was ineffective for
failing to address the issue; and that his plea hearing was inadequate (and the
resulting plea agreement unenforceable), because a judge conducting an
adequate hearing “would have noticed the duplicitous charges.”
The government concedes that four counts were duplicitous. However,
Gunselman waived this issue by pleading guilty. A “voluntary and
unconditional plea waive[s the] right to appeal any nonjurisdictional defects in
the prior proceedings,” and duplicity is a nonjurisdictional defect. 11 Gunselman
did not condition his plea on being able to challenge the duplicitous charges. 12
Therefore, his duplicity claims are waived except insofar as they affect the
validity of the plea itself.
A plea is invalid if it was not knowing and voluntary, but as discussed
above, Gunselman’s plea was knowing and voluntary. The fact that some of the
charges were duplicitous, and that this issue was not aired at the plea hearing,
does not alter this conclusion, since the record shows that Gunselman still
understood the nature of the charges. Neither Rule 11 nor our case law
required anything more. 13
11 Lampazianie, 251 F.3d at 525-56 & n.19.
12 See FED. R. CRIM. P. 11(a)(2) (“[A] defendant may enter a conditional plea of guilty
or nolo contendere, reserving in writing the right to have an appellate court review an
adverse determination of a specified pretrial motion.”).
13 See id. 11(b)(1)(G); United States v. Bachynsky, 924 F.2d 561, 565 (5th Cir. 1991)
(“We agree with Bachynsky that the charges to which he pled guilty were complex and that
the district court did not explain every facet of each charge. But the purpose of Rule 11 is not
to have every detail of the charge read aloud to the defendant; rather, its purpose is to ensure
7
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A plea may also be invalid if it was tainted by ineffective assistance of
counsel in such a way that the plea cannot be considered truly voluntary. 14
Gunselman alleges that his counsel was ineffective for failing to notice and
object to the duplicitous charges, and for advising him to enter a plea
agreement based on duplicitous charges. This claim is foreclosed: “Sixth
Amendment claims of ineffective assistance of counsel should not be litigated
on direct appeal, unless they were previously presented to the trial court.” 15
And even if we were to consider this claim on the merits, it would fail, as
Gunselman could not have suffered prejudice from his attorney’s failure to spot
the duplicity. To prevail on an ineffective assistance of counsel claim relating
to a guilty plea, “the defendant must show that there is a reasonable
probability that, but for counsel's errors, he would not have pleaded guilty and
would have insisted on going to trial.” 16 Gunselman appears to think that the
affected charges would have been dismissed upon objection, such that he would
have been entitled to a more lenient plea deal or a lower sentence and would
that the defendant adequately understands the charge to which he is pleading guilty, and to
have that understanding documented on the record.”). We have recognized that there is no
“simple or mechanical rule” to guide the district judge in deciding how extensively to describe
charges to a defendant in order to fulfill Rule 11(b)(1)(G), and that the inquiry is highly
context-specific and ultimately “commit[ted] . . . to the good judgment of the court.” United
States v. Dayton, 604 F.2d 931, 937-38 (5th Cir. 1979) (en banc). The contextual factors here,
including the fact that Gunselman was represented by counsel and the fact that he is
intelligent enough to have produced a lengthy and fairly sophisticated pro se brief on appeal,
strongly suggest that the judge’s description was adequate.
14 See United States v. Henderson, 72 F.3d 463, 465 (5th Cir. 1995); Murray v. Collins,
981 F.2d 1255 (5th Cir. 1992) (“A valid guilty plea waives all nonjurisdictional defects
including an ineffective assistance of counsel claim, unless the ineffective assistance claim
goes to the voluntariness of the plea.”). Gunselman reserved the right to appeal his conviction
on the basis of ineffective assistance of counsel.
15 United States v. Isgar, 739 F.3d 829, 841 (5th Cir.), cert. denied sub nom. Aldridge
v. United States, 135 S. Ct. 123 (2014) (quoting United States v. Aguilar, 503 F.3d 431, 436
(5th Cir. 2007) (per curiam)). Although this rule is lifted in “rare cases in which the record
allows a reviewing court to fairly evaluate the merits of the claim,” id. (quoting Aguilar, 503
F.3d at 436), the record before us suggests little about Gunselman’s counsel’s approach to the
issues relevant here.
16 Hill v. Lockhart, 474 U.S. 52, 59 (1985).
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therefore have had reason to reject the plea offered. But a duplicitous charge
need not be dismissed. 17 Indeed, the government could simply have divided up
the duplicitous counts and reindicted, thus subjecting Gunselman to more
charges. Moreover, even if the duplicitous charges had been dismissed, this
would not have affected the length of his sentence or his restitution obligation,
because under the sentencing guidelines, the loss amount from which those
figures were to be calculated was to be based on the entire course of conduct
underlying the charges – not only on the conduct alleged in the charges
themselves. 18
IV
Gunselman also alleges prosecutorial misconduct. He claims the
prosecution lied in alleging in the indictment that he sold RINs produced at
his Anton, Texas plant to Marathon Petroleum, when government documents
actually indicated that he had purchased them from another biodiesel
company. He also claims that the prosecution intercepted a payment from
Tesoro Refining to Gunselman for fake RINs, then charged him anyway for
receiving the money. 19
Again, Gunselman has waived these claims, because they do not
implicate the jurisdiction of the trial court; as noted above, Gunselman’s
“voluntary and unconditional plea waived his right to appeal any
17 See Lampazianie, 251 F.3d at 526.
18 See U.S. Sentencing Guidelines Manual § 1B1.3(a), (a)(2) (“[S]pecific offense
characteristics . . . with respect to offenses of a character for which § 3D1.2(d) would require
grouping of multiple counts” “shall be determined on the basis of” “all acts and omissions . . .
that were part of the same course of conduct or common scheme or plan as the offense of
conviction.”) (emphasis added), § 3D1.2(d) (counts for offenses covered by § 2B1.1, which
addresses crimes of fraud and deceit, are to be grouped).
19 Gunselman further claims that his counsel was ineffective for failing to address the
alleged prosecutorial misconduct. This claim is foreclosed because Gunselman did not present
it to the trial court. See supra note 15 and accompanying text.
9
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nonjurisdictional defects in the prior proceedings.” 20 Both claims also fail on
the merits. As part of his plea, Gunselman admitted that the allegations in the
indictment were true, including the allegation that the Marathon RINs in
question were produced in Anton. 21 In addition, the Tesoro wire fraud charge
is unaffected by the government’s purportedly having intercepted the relevant
payment, because “wire fraud is complete when a defendant makes a
communication to advance what he knows to be a fraudulent scheme,” not
when he receives money. 22
V
In other points of purported error, Gunselman objects, as he did below,
to the loss amount on which his sentence and restitution obligation are based. 23
He notes that the roughly $54 million loss for which he was ultimately held
responsible differs from the roughly $41 million loss he stipulated to in the plea
agreement, and argues that the difference indicates that his restitution
obligation and sentence are excessive.
In the plea agreement, Gunselman stated that he “fully underst[ood]
that he [would] not be allowed to withdraw his plea of guilty if, after a
presentence report has been prepared, the amount of loss [were] found to be
higher than the [stipulated] amount” and that he “underst[ood] that the . . .
stipulation [was] not binding upon the court or upon the probation office, and
he [would] not be allowed to withdraw his guilty plea [if] the stipulation [were]
not be followed by the Court.” The fact that he stipulated to a lower loss amount
20 Lampazianie, 251 F.3d at 526.
21 Gunselman also affirmed, at the plea hearing, that the factual resume in the plea
agreement was accurate. See United States v. Cervantes, 132 F.3d 1106, 1110 (5th Cir. 1998)
(“Solemn declarations in open court carry a strong presumption of verity.”) (quoting
Blackledge v. Allison, 431 U.S. 63, 73-74 (1977)).
22 United States v. Neal, 294 F. App’x 96, 101 (5th Cir. 2008).
23 Strictly speaking, Gunselman objected to the loss amount calculation only insofar
as it affected restitution; however, the arguments as to the sentence are the same.
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is therefore immaterial in isolation. Gunselman must show that the use of the
higher loss amount caused a “punishment in excess of the statutory
maximum.” He claims that it did, for two reasons.
First, Gunselman claims that the loss amount reflects losses incurred
before the transactions listed in the indictment. Specifically, he argues that
the loss amount includes losses arising from transactions with BioUrja
Trading that occurred before September 2010, the starting point for the
charges outlined in the indictment. 24 He objected to the initial version of the
PSR on the same ground. In response, an addendum to the PSR noted that “the
pre-September 2010 transactions were not considered in the restitution
request for BioUrja Trading, LLC., though they were considered as loss.”
Gunselman does not allege that the evidence belies this assertion, so his
argument fails insofar as restitution is at issue. Moreover, it was permissible
to consider the transactions in question in calculating his sentence, because as
discussed above, the sentence was to be calculated based on “all acts and
omissions . . . that were part of the same course of conduct or common scheme
or plan as the offense of conviction.” 25
Second, Gunselman objects to the method the court used to appraise his
victims’ losses. Following the PSR, the court determined that each victim’s loss
was the greater of the amount each paid for the fraudulent RINs and the
amount each paid to replace the fraudulent RINs with legitimate ones.
Gunselman objects to the use of replacement costs in any capacity and to the
24 See United States v. Sharma, 703 F.3d 318, 323 (5th Cir. 2012) (under the MVRA,
“[a]n award of restitution cannot compensate a victim for losses caused by conduct not
charged in the indictment or specified in a guilty plea, or for losses caused by conduct that
falls outside the temporal scope of the acts of conviction.”). Under Sharma, Gunselman’s
argument alleges that his restitution obligation exceeds the statutory maximum, so his
appellate waiver does not foreclose the argument. See id. at 321 n.1.
25 See supra note 18.
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use of the higher of the two figures in determining each victim’s awards. 26 We
construe these as arguments that the restitution award exceeds the statutory
maximum, rendering Gunselman’s appellate waiver inapplicable, at least as
far as restitution is concerned. 27 However, Gunselman’s argument is waived
insofar as it implicates the length of his sentence. 28
“A restitution award is reviewed for an abuse of discretion[;] ‘[a] trial
court abuses its discretion when its ruling is based on an erroneous view of the
law or a clearly erroneous assessment of the evidence.’” 29 We have held that
the MVRA does not allow restitution for consequential damages, such as
amounts expended as legal fees or in order to recover stolen property. 30
Gunselman claims that replacement costs are consequential damages akin to
penalties, since the victims had to buy legitimate RINs in order to comply with
the law. 31 As other circuits have recognized, the MVRA “contemplate[s] the
exercise of discretion by sentencing courts in determining the measure of value
appropriate to restitution calculation in a given case.” 32 “‘[V]alue’ as used in
the MVRA [is] a flexible concept to be calculated by a district court by the
26 Gunselman also claims that the restitution award included victims’ “other costs,”
such as legal fees. However, the calculation in the PSR appears to derive solely from amounts
paid to Gunselman or expended in replacing the fraudulent RINs.
27 Recall that “Gunselman . . . reserve[d] the right to appeal . . . any punishment
imposed in excess of the statutory maximum” in his plea agreement. See United States v.
Jones, 616 F. App'x 726, 727-29 (5th Cir. 2015) (unpublished) (where appellant executed an
appellate waiver reserving the right to appeal a sentence exceeding the statutory maximum,
addressing his valuation-method challenge on the merits).
28 The exception in Gunselman’s appellate waiver for a punishment in excess of the
statutory maximum does not apply in this context, since his sentence (as distinct from his
restitution obligation) was lower than the statutory maximum.
29 United States v. Crawley, 533 F.3d 349, 358 (5th Cir. 2008) (citation omitted)
(quoting United States v. Yanez Sosa, 513 F.3d 194, 200 (5th Cir. 2008).
30 United States v. Onyiego, 286 F.3d 249, 256 (5th Cir. 2002).
31 Gunselman’s argument is not entirely accurate. It appears that at least one of
Gunselman’s victims had to buy legitimate RINs after the fraud was uncovered because it
had already sold the RINs to third parties, not because it needed to come into compliance
itself.
32 United States v. Boccagna, 450 F.3d 107, 114 (2d Cir. 2006).
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measure that best serves Congress's statutory purpose.” 33 That purpose is
“essentially compensatory: to restore a victim . . . to the position he occupied
before sustaining injury.” 34 Accordingly, other circuits have sanctioned the use
of replacement cost when that measure appears best suited to make victims
whole. 35
In implementing the MVRA’s statutory purpose in this case, we find the
federal sentencing guidelines instructive. 36 They advise the district court to
appraise victims’ injuries according to “the fair market value of the property
unlawfully taken” – unless that value “inadequately measures the harm.” 37 In
this case, Gunselman injured his victims by taking their money under false
pretenses. Naturally, the default measure of their injury, i.e., the “fair market
value of the property” he unlawfully took, is equal to those sums. However,
some of Gunselman’s victims apparently had to scramble, after his fraud was
uncovered, to obtain replacement RINs in order to meet obligations to
customers and regulators. 38 In the process, they were forced to pay more for
the valid RINs than they had paid Gunselman for the fraudulent ones. To
restore to these victims only the amounts they paid Gunselman would
33 Id. at 114-15.
34 Id. at 115.
35 See, e.g., United States v. Wilfong, 551 F.3d 1182, 1184 n.2 (10th Cir. 2008);
Boccagna, 450 F.3d at 116; United States v. Rhodes, 330 F.3d 949, 953 (7th Cir. 2003); United
States v. Simmonds, 235 F.3d 826, 832 (3d Cir. 2000); United States v. Shugart, 176 F.3d
1373, 1375 (11th Cir. 1999). Notably, the federal sentencing guidelines expressly allow courts
to use replacement cost in assessing victims’ losses in “product substitution cases.” U.S.
SENTENCING GUIDELINES MANUAL § 2B1.1 cmt. n.3(A)(v)(I) (U.S. Sentencing Comm’n 2015).
36 Although the MVRA itself, and not the guidelines, governs our restitution analysis,
see, e.g., United States v. Ferdman, 779 F.3d 1129, 1138 (10th Cir. 2015), other courts have
found the guidelines’ commentary instructive in calculating MVRA restitution. See, e.g.,
Rhodes, 330 F.3d at 953-54.
37 Accord Boccagna, 450 F.3d at 115 (fair market value is the default measure of
MVRA restitution).
38 Cf. Rhodes, 330 F.3d at 953 (upholding a restitution award equivalent to “the
amount of money [the victim] had to dole out in order to make its customers whole as a result
of Rhodes' fraud”).
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disregard the difference between the two sums – an additional amount that
came out of the victims’ pockets as a direct and entirely foreseeable result of
Gunselman’s fraud. Given this, and mindful of the discretion afforded the court
below, we find no error in the district court’s use of replacement cost in
calculating Gunselman’s restitution obligation to certain victims. 39
VI
Finally, Gunselman claims that the district court erroneously applied an
enhancement for sophisticated means. He waived this argument; none of the
exceptions in his appellate waiver apply. Moreover, the record contains ample
evidence to support the factual finding that Gunselman employed
sophisticated means, for example, by creating a corporation, purchasing
multiple facilities, disseminating false information to other businesses, and
hiring and manipulating employees to perpetuate the scheme. His claim fails.
VII
The government asks us to modify the judgment below by eliminating its
restitution offset condition. 40 This condition was not part of the oral sentence,
issued on March 29, but was included in Gunselman’s written sentence, issued
on April 12. The government filed a timely Rule 35(a) motion to eliminate the
condition. 41 The district court assented and ordered the modification on April
39 See United States v. Simpson, 741 F.3d 539, 556-57 (5th Cir. 2014); United States v.
Crawley, 533 F.3d 349, 358 (5th Cir. 2008); see also United States v. Spencer, 700 F.3d 317,
323 (8th Cir. 2012) (discussing the MVRA’s causation requirement).
40 The judgment ordered that Gunselman’s restitution “be offset by funds already
seized and in the hands of the Government, as well as any additional funds garnered by the
Government from loan payments, sale of items, and any other cash flows.”
41 See FED. R. CRIM. P. 35(a) (“Within 14 days after sentencing, the court may correct
a sentence that resulted from arithmetical, technical, or other clear error.”), (c) (“As used in
this rule, “sentencing” means the oral announcement of the sentence.”).
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No. 13-10409
30 – more than fourteen days after sentencing. 42 The modification was
therefore ineffective for lack of jurisdiction. 43
We may “affirm, modify, vacate, set aside or reverse any judgment,
decree, or order of a court lawfully brought before it for review, and may
remand the cause and direct the entry of such appropriate judgment, decree,
or order, or require such further proceedings to be had as may be just under
the circumstances.” 44 We see no reason not to make the requested
modification. 45 The oral sentence is legally sound. 46 In addition, when a written
sentence conflicts with an oral sentence, the latter controls. 47 Therefore, we do
not disturb the status quo in reforming the written sentence to match the oral
sentence in this case. 48
VIII
We VACATE the portion of the written judgment below ordering that
Gunselman’s restitution “be offset by funds already seized and in the hands of
42 The sentence was orally pronounced March 29, the motion to correct judgment was
filed on April 12, and the modification was ordered on April 30.
43 See, e.g., United States v. Gonzalez, 509 F. App'x 356, 357 (5th Cir. 2013)
(unpublished).
44 28 U.S.C. § 2106; see United States v. Hermoso, 484 F. App'x 970, 973 (5th Cir. 2012)
(our choice to either reform a judgment or remand to the district court for the same purpose
is discretionary).
45 Gunselman claims that the government waived the issue by failing to raise it in the
plea agreement or at sentencing, but the government persuasively argues that it had no
reason to raise the issue until the offset provision appeared in the written sentence, since the
inclusion of the offset provision was the deviation from the status quo. Gunselman also claims
that the government violated the plea agreement by moving for modification; however, the
plea agreement did not address the offset issue, whether implicitly or explicitly.
46 See United States v. Taylor, 582 F.3d 558, 568 (5th Cir. 2009) (a defendant is not
entitled to have the district court “offset[ a] restitution obligation by the amount [the
defendant] was required to forfeit,” at least where “there is no evidence that the victims of
[the] criminal conduct have received any of the forfeited funds or other restitution
payments”). As of the PSR, no forfeited funds had been disbursed to victims.
47 United States v. Martinez, 250 F.3d 941, 942 (5th Cir. 2001).
48 Gunselman claims that his counsel was ineffective because he “specifically [and
erroneously] counseled [Gunselman] that collected monies would be applied toward
restitution.” This claim is foreclosed because Gunselman did not present it to the trial court.
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the Government, as well as any additional funds garnered by the Government
from loan payments, sale of items, and any other cash flows.” In all other
respects, we AFFIRM the judgment of the district court.
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