United States v. Frank Randolph

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 15a0163p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
UNITED STATES OF AMERICA, ┐
Plaintiff-Appellee, │
│
│ No. 13-5477
v. │
>
│
FRANK DWAYNE RANDOLPH, │
Defendant-Appellant. ┘
Appeal from the United States District Court
for the Middle District of Tennessee at Nashville.
No. 3:11-cr-00082—Aleta Arthur Trauger, District Judge.
Argued: March 6, 2015
Decided and Filed: July 24, 2015
BEFORE: GRIFFIN and STRANCH, Circuit Judges; STEEH District Judge.*
_________________
COUNSEL
ARGUED: Donald F. Samuel, GARLAND, SAMUEL & LOEB, P.C., Atlanta, Georgia, for
Appellant. David Lieberman, UNITED STATES DEPARTMENT OF JUSTICE, Washington,
D.C., for Appellee. ON BRIEF: Donald F. Samuel, Amanda R. Clark-Palmer, GARLAND,
SAMUEL & LOEB, P.C., Atlanta, Georgia, for Appellant. David Lieberman, UNITED
STATES DEPARTMENT OF JUSTICE, Washington, D.C., Sunny A.M. Koshy, UNITED
STATES ATTORNEY’S OFFICE, Nashville, Tennessee, for Appellee.
*
The Honorable George Caram Steeh, Senior United States District Judge for the Eastern District of
Michigan, sitting by designation.
1
No. 13-5477 United States v. Randolph Page 2
_________________
OPINION
_________________
GEORGE CARAM STEEH, Senior District Judge. Defendant-Appellant Frank
Randolph was convicted after a jury trial on counts of conspiracy to violate the drug laws,
conspiracy to commit money laundering and related offenses. Randolph was sentenced to a
concurrent term of imprisonment of 70 months on all counts. For purposes of sentencing, all of
the convictions were grouped, with the money laundering conspiracy conviction driving the
ultimate sentence because it resulted in the highest offense level. Randolph challenges his
convictions and sentence.
For the reasons that follow, we REVERSE the drug conspiracy conviction in Count One
and REMAND to the district court for entry of a judgment of acquittal in favor of Randolph. We
AFFIRM the district court’s judgment of conviction as to the remaining counts. However, in
sentencing Randolph, the district court determined that he laundered in excess of $200,000
during the course of the money laundering conspiracy without making adequate findings of fact
on the record. We therefore VACATE Randolph’s sentence and REMAND to the district court
for further proceedings consistent with this opinion.
I. BACKGROUND
Randolph’s convictions center around his involvement in a family-run drug trafficking
operation in Pulaski, Tennessee. In late 2009, with the help of two confidential informants, a
joint task force of local and federal authorities began investigating Randolph’s half-brother,
Travis Gentry. The joint task force used video and wiretap surveillance to learn the details of
Gentry’s drug operation—dating back to early 2007—involving the distribution of cocaine,
cocaine base and marijuana. Through the investigation, Randolph’s role in helping Gentry hide
some of the drug trafficking proceeds became known. Randolph stored Gentry’s money at his
home and in certificates of deposit.
On March 17, 2011, the joint task force concluded its investigation by conducting a series
of coordinated raids. Firearms and cash were seized from Randolph’s home. In addition, two
No. 13-5477 United States v. Randolph Page 3
safety deposit keys were found in a safe, leading authorities to Randolph’s bank—the First
National Bank in Pulaski. Pursuant to a search warrant, a safety deposit box belonging to
Randolph was searched. Cash was found in the safety deposit box, including, $2,100 traced back
to marked money that the joint task force used in effectuating a controlled purchase of cocaine
between a confidential informant and Gentry. A total of approximately $165,000 in property
was seized from Randolph. Of this amount, $124,641.51 was seized directly from Randolph’s
bank accounts.
Initially charging twenty defendants in drug trafficking and money laundering
conspiracies, the government filed a Second Superceding Indictment after multiple defendants
pleaded guilty along the way. The Second Superceding Indictment charged five defendants:
Travis Gentry, Frank Randolph, Patrick Smith, Betty Gentry and Todd Bryant. Randolph was
charged in five counts: conspiracy to violate the federal drug laws, in violation of 21 U.S.C.
§ 846 (Count One); conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h)
(Count Two); knowingly possessing firearms in furtherance of a drug trafficking crime, in
violation of 18 U.S.C. § 924(c) (Count Three); receiving, relieving, comforting and assisting
others to hinder and prevent their apprehension, trial and punishment, in violation of 18 U.S.C.
§ 3 (Count Ten); and perjury at the initial appearance, in violation of 18 U.S.C. § 1621(1) (Count
Twelve).
Randolph negotiated with the government to enter into a plea agreement. The plea
agreement required Randolph to plead guilty to (1) being an accessory after the fact to the drug
conspiracy; and (2) perjury. In exchange, the government agreed to allow Randolph to be
sentenced to time-served, which at the time was less than one-year. The plea deal fell through,
however, because Randolph would not agree that he, on occasion, obtained controlled substances
for Gentry.
Three of the five defendants—Travis Gentry, Randolph and Smith—went to trial together
in October 2012. Randolph’s defense to the charges against him was that the monies seized from
him were obtained from legitimate sources—two legitimate jobs—and did not constitute drug
trafficking proceeds. To this end, Randolph sought to cross-examine a government witness
(Agent Darryl Richardson) about the government’s position in pretrial forfeiture proceedings that
No. 13-5477 United States v. Randolph Page 4
money seized from Randolph’s bank accounts constituted “substitute assets”; but, sustaining the
government’s objection at trial, the district court did not permit Randolph to pursue this line of
questioning. A little more background information is necessary to understanding the relevance
of Randolph’s inquiry.
Prior to trial, Randolph filed a motion seeking the return of the $124,641.51 seized from
his bank accounts. Randolph argued that, because the government did not initiate civil forfeiture
proceedings, it was required to return the money to him. The government took the position that
the seized funds were “substitute assets,” and, therefore, properly forfeited prior to trial. Citing
to the government’s concession that the funds constituted “substitute assets,” the district court
ordered the funds returned to Randolph. The district court reasoned that the government was not
entitled to seizure of substitute assets prior to Randolph being convicted at trial. It was the
government’s pretrial position that the funds constituted “substitute assets” that Randolph
wanted to examine Agent Richardson about at trial.
The jury convicted Randolph of the drug trafficking and money laundering conspiracies,
as well as perjury and aiding and abetting. Randolph was acquitted of knowingly possessing a
firearm in furtherance of a drug trafficking crime. As it relates to the drug trafficking conspiracy
charged in Count One, however, the verdict used multiple sub-questions after asking the general
question of whether Randolph was “Guilty” or “Not Guilty.” The result was anything but a
model of clarity.
In determining whether the defendants were guilty of the drug trafficking conspiracy
charged in Count One, the jury was first asked to find whether each defendant was “Guilty” or
“Not Guilty” of the conspiracy. Next, the jury was required to determine, in three separate sub-
questions, the amount of cocaine, crack cocaine and marijuana—the drugs that were charged in
the conspiracy—“involved in the conspiracy.” One of the options available for the jury to
choose was “None.” On Randolph’s verdict form, the jury checked “Guilty,” but as to the
amount of cocaine, crack cocaine and marijuana involved in the conspiracy, checked “None” as
it relates to each drug.
Initially, the district court instructed the jury, “If you unanimously find that a particular
defendant did not possess any particular controlled substance, mark none on the appropriate
No. 13-5477 United States v. Randolph Page 5
special verdict form. If you unanimously find that a particular controlled substance was not
involved in the offense, mark none on the appropriate special verdict form.” Following this
instruction, the government recognized that the possession inquiry was irrelevant as it relates to
the conspiracy charge and requested the district court strike the prior instruction. Agreeing with
the government, the district court corrected the instruction to the jury: “If you unanimously find
that – cross out a particular defendant did not possess. Cross out a particular defendant did not
possess any of. It should read . . . , If you unanimously find that a particular controlled substance
was not involved in the offense, mark none on the appropriate special verdict form.”
Prior to sentencing, a presentence investigation report (“PSR”) was prepared by the
probation department. The PSR concluded (relying on the government’s argument) that the
investigation revealed Randolph laundered more than $200,000, but less than $400,000, during
the course of the money laundering conspiracy. This resulted in an additional 12 points being
added to Randolph’s base offense level. Ultimately, Randolph’s total offense level was
calculated as 30, with a criminal history category of I, resulting in Guideline range of 97-to-121
months. The Guideline range for Randolph’s sentence was calculated by grouping all of his
convictions together. The offense level applicable to the group of convictions was the offense
level relative to the Count Two money laundering conspiracy conviction because it resulted in
the highest offense level. Therefore, the Count Two conviction drove the district court’s
Guideline calculation.
In his sentencing memorandum, Randolph objected to the PSR’s calculation of the
laundered funds, contending that “[t]he only money arguably proven to have been
‘laundered’ . . . was $2100 from a Travis Gentry drug sale found in his safe deposit box.” This
would not have resulted in any increase to his base offense level. See U.S.S.G. § 2B1.1(b)(1).
The district court overruled Randolph’s objection stating that “[t]he testimony of Amber Stack,
among others, established that the money laundering was easily in excess of $200,000.”
Notwithstanding this finding, however, the district court sentenced Randolph to a below-
Guideline, concurrent term of imprisonment of 70 months on each count. In so doing, the
district court stated that it was considering the facts and circumstances surrounding Randolph’s
aborted plea agreement.
No. 13-5477 United States v. Randolph Page 6
Randolph filed a motion for new trial and motion for judgment of acquittal in the district
court as it relates to Counts One, Two and Ten. Recognizing the jury’s inconsistent findings
relating to the drug trafficking conspiracy, Randolph argued that his convictions of Counts One
and Ten were untenable because the jury found him guilty of a drug trafficking conspiracy
involving none of the charged drugs. Randolph also argued that he should have been permitted
to cross-examine Agent Richardson about the government’s pretrial position in forfeiture
proceedings that the funds seized from his accounts were “substitute assets.” The district court
denied Randolph’s motions. First, the district court stated that “the individual findings of drug
possession quantity were for purposes of sentencing and, clearly, a defendant could be convicted
of the drug conspiracy, even if found to have possessed no drugs.” The district court went on to
state: “Perhaps the wording of the question on the Verdict Forms was inartful, asking ‘the
amount of [cocaine, crack cocaine, marijuana] involved in the conspiracy’ instead of the amount
of each drug possessed or intended to be distributed by each defendant during the conspiracy.”
Second, as to Randolph’s position that he should have been permitted to question Agent
Richardson about the pretrial forfeiture proceedings, the district court held that Randolph was not
prejudiced because he was provided with alternative methods of eliciting the same testimony.
Randolph timely appeals from the district court’s final judgment entered against him on
March 28, 2013. He challenges his convictions and sentence on the grounds addressed below.
II. ANALYSIS
A. Inconsistent Verdict
We begin by addressing Randolph’s challenge to his Count One drug trafficking
conspiracy conviction. Randolph argues that his Count One conviction should be reversed
because the jury could not have found him guilty of the conspiracy while simultaneously
determining that the conspiracy did not involve any of the charged drugs. He is correct.
To sustain a drug trafficking conspiracy conviction under 21 U.S.C. § 846, “the
government must have proved (1) an agreement to violate drug laws, in this case 21 U.S.C.
§ 841(a)(1); (2) knowledge and intent to join the conspiracy; and (3) participation in the
conspiracy.” United States v. Martinez, 430 F.3d 317, 330 (6th Cir. 2005) (citing United States
No. 13-5477 United States v. Randolph Page 7
v. Welch, 97 F.3d 142, 148–49 (6th Cir. 1996)). Section 841(a)(1) makes it unlawful for any
person to “knowingly or intentionally. . . manufacture, distribute, or dispense, or possess with
intent to manufacture, distribute or dispense, a controlled substance[.]” Therefore, to convict
Randolph of the charged conspiracy, the jury was required to find that he agreed to “knowingly
or intentionally. . . manufacture, distribute, or dispense, or possess with intent to manufacture,
distribute or dispense, a controlled substance.” The controlled substances charged in the Second
Superceding Indictment were cocaine, cocaine base and marijuana.
Randolph and the government seem to agree that the jury’s answers to the questions
related to Count One in Randolph’s verdict form are confusing. The jury found Randolph guilty
of the drug trafficking conspiracy while simultaneously determining that the amount of charged
drugs “involved in” that conspiracy were “none.” Of course, this cannot be the case. To involve
means “to have or include (someone or something) as part of something.” “Involve.” Merriam-
Webster Online Dictionary. 2015. http://www.meriam-webster.com/dictionary/involve. In
essence, the jury found Randolph guilty of conspiracy to distribute drugs, and, at the same time,
found that the conspiracy “had” or “included” none of the drugs charged by the government.
Despite this obvious inconsistency in the jury’s responses in the verdict, there is much
disagreement about what we should do about the confusion.
Randolph argues that we should reverse his Count One conviction because the jury’s
logically inconsistent findings are analogous to a mutually exclusive verdict. In addition,
Randolph cites to Rule 49 of the Federal Rules of Civil Procedure arguing that, like a civil case,
where special interrogatory answers are inconsistent in a criminal case, a new trial is the
appropriate remedy.
The government’s main argument in opposition is that inconsistent verdicts generally are
not reviewable. And this case does not involve a mutually exclusive verdict, which would be
reviewable, the government argues. According to the government, the jury’s findings related to
the amount of drugs were relevant only as it relates to a determination of the mandatory
minimum penalties contained in 21 U.S.C. § 841. Therefore, the government asks us to affirm
Randolph’s Count One conviction.
No. 13-5477 United States v. Randolph Page 8
Our analysis begins with an explanation of inconsistent verdicts. The Supreme Court
first opined on inconsistent verdicts in Dunn v. United States, 284 U.S. 390 (1932). In Dunn, the
defendant was indicted on three counts: (1) maintaining a common nuisance by keeping for sale
at a specified place intoxicating liquor; (2) unlawful possession of intoxicating liquor; and
(3) unlawful sale of such liquor. Id. at 391. He was convicted of the first count, but acquitted on
counts two and three. Id. at 391–92. The defendant argued that his conviction of count one
should be overturned because it was inconsistent with being acquitted of counts two and three.
Id. at 392. But the Court rejected the defendant’s argument, explaining that “[c]onsistency in the
verdict is not necessary.” Id. at 393. The Court held that, where separate counts charge separate
crimes in a single indictment, the separate counts are treated the same as separate indictments
separately tried. Id. The Court recognized that a “verdict may have been the result of
compromise, or of a mistake on the part of the jury,” but that “verdicts cannot be upset by
speculation or inquiry into such matters.” Id. at 394.
The Dunn holding was applied in United States v. Dotterweich, where a verdict in a joint
trial that found the president of a corporation guilty, while simultaneously finding the
corporation not guilty, was found to be permissible. 320 U.S. 277, 278–79 (1943). The Court,
citing Dunn, explained: “Whether the jury’s verdict was the result of carelessness or compromise
or a belief that the responsible individual should suffer the penalty instead of merely increasing,
as it were, the cost of running the business of the corporation, is immaterial. Juries may indulge
in precisely such motives or vagaries.” Id. And again Dunn was applied in the Court’s decision
in Harris v. Rivera, where the defendant unsuccessfully challenged his conviction of robbery and
related offenses on the grounds that a co-defendant was acquitted of the same offenses after a
joint bench trial. 454 U.S. 339, 340 (1981). The Court reasoned, “[e]ven assuming that this
acquittal was logically inconsistent with the conviction of respondent, respondent, who was
found guilty beyond a reasonable doubt after a fair trial, has no constitutional ground to complain
that [a co-defendant] was acquitted.” Id. at 348.
The Court revisited Dunn in United States v. Powell, 469 U.S. 57 (1984). In Powell, the
defendant was indicted by a grand jury on 15 counts of violations of federal law related to her
involvement in a drug distribution operation. Id. at 59. The defendant was convicted of using
No. 13-5477 United States v. Randolph Page 9
the telephone in “committing and in causing and facilitating” the “conspiracy to possess with
intent to distribute and possession with the intent to distribute cocaine,” but acquitted of
conspiring with others to knowingly and intentionally possess with intent to distribute cocaine
and possession of a specific quantity of cocaine with intent to distribute it. Id. at 59–60. She
argued that she was entitled to reversal of the telephone facilitation convictions because the
verdicts were inconsistent. Id. at 60. Specifically, she averred that “proof that she had conspired
to possess cocaine with intent to distribute, or had so possessed cocaine, was an element of each
of the telephone facilitation counts; since she had been acquitted of these offenses . . . , [she]
argued that the telephone convictions were not consistent with those acquittals.” Id. The Court
rejected this argument, upholding the defendant’s convictions.
In rejecting the defendant’s argument in Powell, the Court explained that inconsistent
verdicts do not necessarily mean a windfall for the government. Id. at 65. Indeed, “[i]t is
equally possible that the jury, convinced of guilt, properly reached its conclusion on the
compound offense, and then through mistake, compromise, or lenity, arrived at an inconsistent
conclusion on the lesser offense.” Id. The Court continued:
Inconsistent verdicts therefore present a situation where “error,” in the sense that
the jury has not followed the court’s instructions, most certainly has occurred, but
it is unclear whose ox has been gored. Given this uncertainty, and the fact that the
Government is precluded from challenging the acquittal, it is hardly satisfactory
to allow the defendant to receive a new trial on the conviction as a matter of
course... For us, the possibility that the inconsistent verdicts may favor the
criminal defendant as well as the Government militates against review of such
convictions at the defendant’s behest.
Id. A defendant is protected against jury irrationality, the Court explained, by “the independent
review of the sufficiency of the evidence undertaken by the trial and appellate courts.” Id. at 67.
Applying the above precedents, we have repeatedly recognized the proposition that
inconsistent verdicts in a criminal case generally are not reviewable. United States v. Smith,
749 F.3d 465, 498 (6th Cir. 2014). This, however, is not a hard-and-fast rule. There are two
exceptions. First, where jury verdicts “are marked by such inconsistency as to indicate
arbitrariness or irrationality,” we have opined that “relief may be warranted.” United States v.
Lawrence, 555 F.3d 254, 263 (6th Cir. 2009). Second, in a situation “where a guilty verdict on
No. 13-5477 United States v. Randolph Page 10
one count necessarily excludes a finding of guilt on another,” i.e. a “mutually exclusive” verdict,
this court can review the defendant’s challenge to the verdict. United States v. Ruiz, 386 F.
App’x 530, 533 (6th Cir. 2010) (citing Powell, 469 U.S. 69, n. 8); see also United States v.
Ashraf, 628 F.3d 813, 823–24 (6th Cir. 2011) (recognizing two exceptions to general rule that
inconsistent verdicts are not reviewable).
Against this backdrop, we turn to our situation, which is different. Here, we are not
dealing with inconsistent verdicts. Instead, we have an internal inconsistency in the same count,
as it relates to the same defendant, in the same verdict. We have not addressed this situation, but
one of our sister circuits has.
In United States v. Shippley, the defendant was charged in a federal drug conspiracy
under 21 U.S.C. § 846. 690 F.3d 1192, 1193 (10th Cir. 2012). At the end of trial, the jury
returned a general verdict finding the defendant guilty of the conspiracy charge. Id. However, in
response to the court’s special interrogatories, the jury indicated that the defendant “had not
conspired to distribute any of the drugs listed in the indictment. In effect, the jury both convicted
and acquitted [the defendant] of the charged conspiracy.” Id. (emphasis in original). Faced with
this dilemma, the district court ordered the jury to deliberate further, instructing the jury that
“‘[y]our ostensible verdict of guilty as to the crime of conspiracy as charged in Count One of the
Indictment is inherently inconsistent with your answers to the Special Questions.’” Id. The
district court gave the jury three options: (1) reconsider its answers to the special interrogatories
if it wanted to render a guilty verdict; (2) reconsider its answer in the general verdict form if it
wished to render a verdict of not guilty; or (3) stand on its existing verdict. Id. at 1193–94. The
result: an unambiguous guilty verdict finding the defendant guilty of conspiring to distribute
500 grams or more of cocaine. Id. at 1194.
On appeal, the defendant challenged the district court’s procedure in allowing the jury to
deliberate further. Relying on Powell and Dotterweich, the defendant argued that the district
court should have entered a verdict of acquittal after receiving the inconsistent general verdict
and special interrogatory answers. Id. Requiring the jury to deliberate further, the defendant
argued, violated his Fifth Amendment right to due process and Sixth Amendment right to a jury
trial. Id. Distinguishing the facts from Powell and Dotterweich, the Tenth Circuit explained:
No. 13-5477 United States v. Randolph Page 11
In our case, it wasn’t just logically incongruous to enter the jury’s verdict, it was
metaphysically impossible. Powell and Dotterweich involved logical
inconsistencies between counts and between defendants. However illogical, the
verdicts in those cases could be given full effect. This case, by contrast, involves
an inconsistency on the same count with the same defendant—an inconsistency
that simply could not have been given full effect. Something had to give in our
case that didn’t have to give in these other cases. To enter an acquittal, the district
court would have needed to disregard the fact that the jury expressly found [the
defendant] guilty. To enter a guilty verdict, the court would have needed to
overlook the special verdict findings that [the defendant] did not conspire to
distribute any of the drugs at issue in the case. And nothing in Powell or
Dotterweich speaks either explicitly or implicitly about what a court’s to do in
these circumstances, let alone suggests the district court committed an error of
constitutional magnitude (or otherwise) in proceeding as it did in this case.
Id. at 1195–96 (emphasis in original).
We agree with Shippley that Powell and Doetterweich are different than the situation at
hand and do not control the analysis. Here, unlike the situations in Powell, Doetterweich and the
inconsistent verdict line of cases, the jury’s verdict, when read in its entirety, reveals that the
government failed to prove an essential element of the charged drug conspiracy. For the jury to
find Randolph guilty of the drug conspiracy, an essential element the government was required
to prove beyond a reasonable doubt was that the drugs charged in the indictment were “involved
in” the conspiracy. As explained, the final jury instructions asked the jury to “mark none on the
appropriate special verdict form” if “you unanimously find that a particular controlled substance
was not involved in the offense.” Because the jury found that none of the charged drugs were
“involved in” the conspiracy, it follows that Randolph cannot be guilty of the charged
conspiracy. He is entitled to a judgment of acquittal.
It is well-established that “[t]he Constitution gives a criminal defendant the right to
demand that a jury find him guilty of all of the elements of the crime with which he is charged.”
United States v. Gaudin, 515 U.S. 506, 511 (1995). Where a jury’s special verdict finding
negates an essential element of the offense, the defendant must be acquitted and cannot be retried
on that offense. See United States v. Lucarelli, 476 F. Supp. 2d 163, 167 (D. Conn. 2007)
(acquitting defendant of securities fraud charges where jury, in special interrogatories, found that
defendant did not act with specific intent, despite finding defendant guilty in general verdict); see
also State v. Goins, 92 P.3d 181, 189–90 (Wash. 2004) (en banc) (Sanders, J., dissenting). To
No. 13-5477 United States v. Randolph Page 12
allow a retrial when the government fails to prove an essential element of the charge beyond a
reasonable doubt violates the Double Jeopardy Clause of the Fifth Amendment, which states that
no person shall “be subject for the same offense to be twice put in jeopardy of life or limb.” U.S.
Const. amend. V. Here, the jury’s special verdict found that the drugs “involved in” the
conspiracy were “none.” This unanimous finding negates an essential element of the charged
drug conspiracy and is only susceptible to one interpretation: the government failed to prove
Randolph guilty of the charged drug conspiracy beyond a reasonable doubt.
To the extent that dicta in Shippley suggests that the appropriate remedy in this situation
is a remand for a new trial, we disagree. 690 F.3d at 1196 (“To enter any verdict when the jury
first returned, the district court would have had to choose to “gore” one side or the other—just
what Powell suggests courts should not do.”). As Shippley recognized, inconsistences in the
same count as to the same defendant are different than Powell where the inconsistency is
between counts. Where the inconsistency is between counts, we do not know which count the
jury erred in deciding—the acquittal or the conviction. But in our situation, where the
inconsistency is in the same count as to the same defendant, if we allow the government “another
opportunity to subject [Randolph] to ‘factfinding proceedings going to guilt or innocence,’
hoping this time for a less ambiguous result,” “[t]hat would be a classic instance of
impermissible double jeopardy.” United States v. Fernandez, 722 F.3d 1, 39 (1st Cir. 2013).
Indeed, one jury has already determined that the amount of drugs “involved in” the purported
drug conspiracy were “none.” To allow a different jury to reconsider this finding is double
jeopardy.
For these reasons, we reverse Randolph’s judgment of conviction of Count One and
remand to the district court for entry of a judgment of acquittal.1
B. District Court’s Discretion In Handling
Evidence As It Relates To Pretrial Forfeiture Proceedings
Randolph next challenges his Count Two money laundering conspiracy conviction.
Randolph argues that the trial court abused its discretion in (1) allowing Agent Darryl
1
Given this outcome, we do not address Randolph’s alternative argument that the evidence was insufficient
to convict him of the drug trafficking conspiracy.
No. 13-5477 United States v. Randolph Page 13
Richardson to testify about funds seized from him during the course of the drug investigation;
and (2) precluding him from questioning Agent Richardson about the pretrial forfeiture
proceedings in which over $124,000 of seized funds were returned to Randolph. In short,
Randolph argues that the jury would not have convicted him of a money laundering conspiracy if
the jury had known that the government had taken the pretrial position that the property seized
from Randolph constituted “substitute assets.” We find no error in the district court’s handling
of the evidence.
We review the district court’s admission or exclusion of evidence for abuse of discretion.
United States v. Bell, 516 F.3d 432, 440 (6th Cir. 2008). The district court’s conclusions of law
are reviewed de novo, while the court’s factual determinations underpinning the legal
conclusions are reviewed for clear error. United States v. Ganier, 468 F.3d 920, 925 (6th Cir.
2006). If there is no objection to the admission or exclusion of evidence at trial, our review is
restricted to plain error, i.e. (1) an error, (2) that is plain, and (3) affecting the defendant’s
substantial rights. United States v. Atchley, 474 F.3d 840, 854 (6th Cir. 2007).
Randolph first argues that the district court should not have permitted the government to
question Agent Richardson about the funds seized from Randolph during the course of the
investigation because the government conceded in pretrial forfeiture proceedings that the funds
constituted “substitute assets,” not drug trafficking proceeds. But at trial Randolph did not object
to Agent Richardson’s testimony (or any other witness’ testimony) describing the funds that
were seized from Randolph’s accounts. Therefore, Randolph must establish plain error, which
he cannot do.
At trial, Randolph’s attorney asked agent Richardson:
Q Agent Richardson, apart from the $2,100 that was found in Mr.
Randolph’s safe deposit box that’s allegedly marked money from a
December 2009 transaction – do you know the $2,100 I’m talking about?
A I do.
Q Aside from that, were you able to link any of Mr. Randolph’s other
accounts to any drug transaction?
A That would be no.
No. 13-5477 United States v. Randolph Page 14
In addition, Randolph in his case-in-chief presented testimony that he had multiple legitimate
sources of income. Because Randolph was able to establish through alternative evidence that the
funds seized from his accounts came from legitimate sources, the district court did not plainly err
in allowing Agent Richardson to testify about the property seized from Randolph.
Nor did the district court err in precluding Randolph from cross-examining Agent
Richardson about the pretrial forfeiture proceedings on the basis that delving into the specifics of
the pretrial proceedings would be “confusing” for the jury. Through the alternate line of
questioning permitted by the district court, and the testimony elicited in Randolph’s case-in-
chief, Randolph established the same point he sought to establish by referencing the pretrial
forfeiture proceedings: that the money seized from his accounts came from legitimate sources
and were not drug trafficking proceeds. The jury had the ability to weigh this evidence,
ultimately rejecting the evidence favoring Randolph’s position.
Because Randolph had the opportunity, through alternative means, to establish that the
funds seized from his accounts constituted legitimate income, even if the district court erred in
handling the evidence (which we conclude above that it did not), the error was harmless. We
therefore affirm Randolph’s Count Two money laundering conspiracy conviction.
C. District Court’s Determination of Laundered Funds
Randolph also challenges the district court’s determination in sentencing proceedings that
the amount of funds he laundered during the course of the money laundering conspiracy were in
excess of $200,000. Over Randolph’s objection to the PSR, the district court, citing Amber
Stack’s testimony at trial, determined that Randolph laundered in excess of $200,000 during the
course of the money laundering conspiracy. However, the district court’s finding lacked
specificity. Accordingly, we vacate Randolph’s sentence and remand to the district court for
further proceedings consistent with this opinion.2
“A sentence will be found procedurally unreasonable when the district court failed to
accurately calculate the sentencing recommendation of the United States Sentencing
2
Because Randolph’s convictions were grouped, and the Count Two conviction served as the base for the
district court’s sentence (it had the highest offense level), the proper remedy for the district court’s error is vacating
the sentence and remanding to the district court for further proceedings consistent with this opinion.
No. 13-5477 United States v. Randolph Page 15
Guidelines.” United States v. Anderson, 526 F.3d 319, 323 (6th Cir. 2008) (citations omitted).
The district court’s legal conclusions regarding the Guidelines are reviewed de novo, while
factual findings are reviewed for clear error. Id. (citations omitted). “A remand will not be
required, and an error deemed harmless, however, when ‘we are certain that . . . any such error
did not affect the district court’s selection of the sentence imposed.” Id. at 324 (citation and
internal quotation marks omitted).
Federal Rule of Criminal Procedure 32(i)(3)(B) requires the district court to rule at
sentencing on “any disputed portion of the presentence report or other controverted matter.”
Once a defendant raises a dispute during the sentencing hearing, “the ‘court may not merely
summarily adopt the factual findings in the presentence report or simply declare that the facts are
supported by a preponderance of the evidence.’” United States v. White, 492 F.3d 380, 415 (6th
Cir. 2007).
In applying a co-conspirator’s actions against a defendant in sentencing, the government
must prove by a preponderance of the evidence that the co-conspirator’s actions were reasonably
foreseeable to the defendant. United States v. Wood, 604 F.3d 286, 290–91 (6th Cir. 2010).
“‘Whether a co-conspirator’s actions were reasonably foreseeable is a factual finding reviewed
for clear error.’” Id. (citing United States v. Dupree, 323 F.3d 480, 490 (6th Cir. 2003)).
Randolph argues that the district court clearly erred because Amber Stack’s testimony did
not establish that he laundered in excess of $200,000. At most, Randolph avers, the evidence at
trial established $100,000 in non-payroll deposits, not including Randolph’s earnings from his
successful window-tinting business totaling approximately $10,000 to $20,000. If the district
court applied the $103,000 value, it would have increased Randolph’s base offense level by
8 points, not the 12 points that resulted from a finding that the laundered funds exceeded
$200,000. See U.S.S.G. § 2B1.1(b).
The government responds that the district court correctly determined that the laundered
funds exceeded $200,000. The trial proof, the government argues, established that Randolph, at
a minimum, personally laundered in excess of $100,000 (the non-payroll deposits). In addition,
the government contends that, given that Randolph was charged in a conspiracy to commit
money laundering, he is not only responsible for the monies he personally laundered, but also the
No. 13-5477 United States v. Randolph Page 16
reasonable and foreseeable acts of his co-conspirators. Therefore, the government contends that
Randolph is also responsible for the amount of money laundered by his co-defendants. Taking
this into consideration, the government says that the amount of money laundered during the
course of the conspiracy was well in excess of $200,000.
We do not address the merits of the parties’ arguments because it is unclear from the
record below the reasons the district court applied the $200,000 figure. The district court failed
to adequately explain how it reached the $200,000 calculation. The district court simply stated
that “[t]he testimony of Amber Stack, among others, established that the money laundering was
easily in excess of $200,000.” The district court did not explain whether the $200,000 was
laundered by Randolph individually, and, if so, the facts that supported such conclusion.
Alternatively, if the district court determined that the $200,000 figure incorporated the
reasonable and foreseeable money laundering acts committed by co-conspirators, it failed to state
its reasons to support such a finding. The district court clearly erred by failing to provide a
detailed explanation of how it reached the conclusion that Randolph laundered in excess of
$200,000.
The government concedes that the district court erred in failing to make individualized
fact findings. See Pl’s. Br. at 59 (citing United States v. Orlando, 281 F.3d 586, 600 (6th Cir.
2002)). The government argues, however, that Randolph did not request the district court make
individualized findings of fact, and, therefore, waived the issue. We disagree. First, Randolph
objected to the PSR and he voiced his objection during the sentencing proceedings. Second, it
was the government’s burden at sentencing to show by a preponderance of the evidence that
Randolph’s co-conspirators’ money laundering actions were reasonable and foreseeable to
Randolph, as well as the amount of money laundered by the co-conspirators. Wood, 604 F.3d at
290–91. And it was clear error for the district court to conclude that Randolph laundered in
excess of $200,000 without a sufficient explanation.
Although the district court sentenced Randolph below the Guideline range, the error is
not harmless because that range may change on remand. The Guideline range served as the
district court’s base before it decided to deviate downwards from that range. On remand, the
Guideline range may change, which may influence the district court’s ultimate sentence.
No. 13-5477 United States v. Randolph Page 17
For these reasons, we vacate Randolph’s sentence and remand to the district court for
further proceedings consistent with this opinion.
D. Denial of “Minimal Role” Reduction
Next, Randolph challenges the district court’s denial of a “minimal role,” four-level
reduction of his base offense level under U.S.S.G. § 3B1.2. Discerning no error, we affirm.
The district court’s denial of Randolph’s request for a four-level reduction is reviewed for
clear error. United States v. Garcia-Morones, 49 F. App’x 556, 557 (6th Cir. 2002). A minimal
participant in a conspiracy is a defendant “who [is] plainly among the least culpable of those
involved in the conduct of a group. Under this provision, the defendant’s lack of knowledge or
understanding of the scope and structure of the enterprise and of the activities of others is
indicative of a role as minimal participant.” U.S.S.G. § 3B1.2 n.4.
Randolph contends that he was substantially less culpable than the other participants in
the conspiracy. The minimal role of holding Gentry’s money (never giving it back to him),
Randolph argues, requires a finding that he is substantially less culpable than the other co-
conspirators, and deserving of a four-level reduction.
The government disagrees. The government contends that, with the knowledge that
Gentry was a drug dealer, Randolph played an active role in facilitating the drug trafficking
conspiracy by secreting Gentry’s drug proceeds. The government is correct.
The district court did not clearly err in declining to find that Randolph was a minimal
participant. Although we reverse Randolph’s drug trafficking conspiracy conviction, Randolph
was convicted of the money laundering conspiracy. We have explained that “[t]he Application
Notes to § 3B1.2 instruct that the ‘minimal participant’ reduction is intended to be used
‘infrequently,’ and applies only to defendants who are ‘plainly among the least culpable of those
involved in the conduct of a group.’” United States v. Branham, 460 F. App’x 538, 548 (6th Cir.
2012) (citation omitted). As the district court explained during Randolph’s sentencing
proceedings, Randolph knew that Gentry was a drug dealer who had never held a job, yet he
continued to receive money from Gentry on a regular basis, hiding the money for him. To be
considered a minimal participant, Randolph’s knowledge of the scope and structure of the
No. 13-5477 United States v. Randolph Page 18
enterprise weighs against him here. Branham, 460 F. App’x at 548–49. Given this knowledge,
the district court did not clearly err in declining to find that Randolph was a minimal participant
under § 3B1.2.
E. Remaining Challenges
Finally, to the extent that Randolph challenges his convictions and sentence on any other
bases, we hold that Randolph waived appellate review by failing to adequately raise the issues in
briefing. See United States v. Johnson, 440 F.3d 832, 846 (6th Cir. 2006) (“[I]t is a settled
appellate rule that issues adverted to in a perfunctory manner, unaccompanied by some effort at
developed argumentation, are deemed waived.”) (citation omitted).
III. CONCLUSION
For the reasons stated above, we REVERSE the drug conspiracy conviction in Count One
and REMAND to the district court for entry of a judgment of acquittal in favor of Randolph on
Count One, AFFIRM the district court’s judgment of conviction as to the remaining counts,
VACATE Randolph’s sentence and REMAND to the district court for further proceedings
consistent with this opinion.