United States v. Ortiz, Jose

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 03-1471
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
JOSE ORTIZ,
Defendant-Appellant.
____________
Appeal from the United States District Court
for the Northern District of Indiana, Hammond Division.
No. 2:01 CR 147—James T. Moody, Judge.
____________
ARGUED FEBRUARY 23, 2005—DECIDED DECEMBER 12, 2005
____________
Before CUDAHY, EASTERBROOK, and WILLIAMS, Circuit
Judges.
WILLIAMS, Circuit Judge. Jose Ortiz pled guilty to one
count of distributing marijuana and two counts of distribut-
ing cocaine. At sentencing, the district court found that
Ortiz’s relevant conduct involved 100 kilograms of co-
caine and sentenced him to 240 months imprisonment.
Ortiz argues that the government witness’s testimony
was inconsistent and therefore unreliable. Although we find
aspects of that testimony troubling, we decline to find it
incredible as a matter of law. Ortiz also appeals
his sentence on the grounds that the district court im-
properly attributed to him quantities of cocaine not part
of the offense of conviction. We agree and find that the
2 No. 03-1471
additional cocaine that the district court attributed to Ortiz
was not part of the same common scheme or plan as the
crime to which Ortiz pled guilty, and is thus not relevant
conduct. As such, we vacate Ortiz’s sentence and remand for
resentencing. In light of this remand, we need not address
Ortiz’s arguments under United States v. Booker, 125 S. Ct.
738 (2005).
I. BACKGROUND
Ortiz pled guilty to one count of distributing marijuana
and two counts of distributing cocaine in violation of 21
U.S.C. § 841(a)(1). Ortiz sold drugs from the car repair shop
he ran in Lake Station, Indiana. Unfortunately for Ortiz,
the Drug Enforcement Administration (DEA) launched an
investigation into the northern Indiana drug trade, and had
an informant buy drugs from Ortiz. In his plea, Ortiz
admitted selling drugs to the informant on three occasions:
eight pounds of marijuana in September 2000; five ounces
of cocaine in January 2001; and another five ounces of
cocaine in March 2001.
Around the same time that Ortiz was selling drugs to
the DEA’s informant, the DEA began investigating Jay
Zambrana, another drug dealer. During the course of
that investigation, the DEA spoke with Carlos Ripoll,
who told them that he sold drugs for Zambrana, and
that one of his customers was Ortiz. According to Ortiz’s
presentencing report, Ripoll told the investigators that he
and Zambrana sold at least 15 kilograms of cocaine to Ortiz
during the years 1997 to 1999.
In Ortiz’s presentence report, his probation officer
recommended that the district court include as the drug
quantity for which Ortiz was responsible not only the drugs
that Ortiz sold to the DEA’s informant, but also the 15
kilograms of cocaine that he allegedly bought from Ripoll
and Zambrana. In support of that recommendation, the
No. 03-1471 3
government called Ripoll as a witness at Ortiz’s sentencing
hearing. Ripoll testified that he and Zambrana delivered
even larger quantities of cocaine to Ortiz than what he
previously told the DEA. Specifically, Ripoll testified that
he sold Ortiz more than 100 kilograms of cocaine.
In sentencing Ortiz, the district court concluded that
Ripoll’s testimony regarding the additional 100 kilograms
was credible, and concluded that Ortiz should be held
responsible for 100 kilograms of cocaine. The district court
also denied Ortiz a downward adjustment for acceptance of
responsibility, and added two sentencing points for activity
occurring during supervised release. Accordingly, the
district court sentenced Ortiz to 240 months imprisonment.
From this sentence, Ortiz appeals.
II. ANALYSIS
A. Waiver of District Court’s Relevant Conduct
Determination
We find that Ortiz neither waived nor forfeited the is-
sue of relevant conduct and this issue was properly pre-
served. Waiver is the intentional relinquishment and
abandonment of a known right. United States v. Olano, 507
U.S. 725, 733 (1993). Waiver differs from forfeiture, which
is simply the failure to make a timely assertion of a right.
Id. Waiver extinguishes any error that the district court
may have made and precludes appellate review. United
States v. Staples, 202 F.3d 992, 995 (7th Cir. 2000). Forfei-
ture permits plain error review. Id. A common distinction
we draw between waiver and forfeiture is that waiver comes
about intentionally whereas forfeiture occurs through
neglect. Id.The government argues that Ortiz waived any right to
appeal the district court’s relevant conduct determination
because he failed to object after the district court specifi-
4 No. 03-1471
cally solicited objections to its findings. We find this
argument unconvincing. We have held that we construe
waiver principles liberally in favor of the defendant. United
States v. Sumner, 265 F.3d 532, 538 (7th Cir. 2001). The
record reflects that Ortiz’s counsel objected to the additional
drug quantities asserted in the presentence report. Ortiz’s
counsel filed written objections to the alleged additional
relevant conduct. Ortiz’s counsel also stated at the sentenc-
ing hearing, “Mr. Ortiz argues that his drug quantity
should be calculated only on the counts he has pled to . . .
Mr. Ortiz would argue to the Court that that’s the full
extent of his involvement in drugs as it relates to both the
indictment and his relevant conduct.” Sentencing Hr’g Tr.,
Vol. II at 10-11. The fact that Ortiz’s counsel did not
continue to object regarding the additional relevant con-
duct, after the judge ruled on Ripoll’s testimony, does not
constitute waiver. In addition, after finding that Ripoll was
credible and that the alleged additional transactions should
be considered relevant conduct, the district court specifi-
cally limited objections to those “other than what you have
already argued.” Sentencing Hr’g Tr., Vol. II at 30. We have
held that when a defendant consistently disputes an issue,
and the district court does not specifically elicit objections
to the adequacy of the findings, the defendant is not
required to interpose a further objection to the adequacy of
the district court’s findings after the district court has
ruled. United States v. Freitag, 230 F.3d 1019, 1025 n. 7
(7th Cir. 2000). Ortiz objected to the presentencing report,
and he argued at sentencing that the district court should
only attribute to him the drug quantity to which he pled.
The government is arguing, in essence, that defendants
must take exception to district judges’ rulings, and the clear
language of Fed. R. Crim P. 51(a) states that there is no
need to do so. The actions of Ortiz, through his counsel, are
sufficient to have preserved this issue.
No. 03-1471 5
B. Ripoll’s Credibility
Ortiz argues that we should find Ripoll’s testimony
incredible as a matter of law. Although we conclude in this
opinion that the district court clearly erred by its rele-
vant conduct finding, we decline to take the additional
leap of finding Ripoll incredible as a matter of law. We
review a district court’s witness credibility determinations
for clear error. United States v. Noble, 246 F.3d 946, 953
(7th Cir. 2001). We have held that determinations of
witness credibility are entitled to great deference and “can
virtually never be clear error.” United States v. Blalock, 321
F.3d 686, 690 (7th Cir. 2003) (internal quotation marks and
citation omitted). See also United States v. Ferguson, 35
F.3d 327, 333 (7th Cir. 1994) (“The district court’s evalua-
tion of witness credibility will not be disturbed unless it is
completely without foundation.”); United States v. Porter, 23
F.3d 1274, 1278 (7th Cir. 1994) (“Any argument that the
trial judge should have disbelieved a certain witness is
doomed at the outset.”) We give such a high-level of defer-
ence to such findings of credibility because “[t]he trial judge
has the best opportunity to observe the verbal and nonver-
bal behavior of the witnesses focusing on the subject’s
reactions and responses to the interrogatories, their facial
expressions, attitudes, tone of voice, eye contact, posture
and body movements, as well as confused or nervous speech
patterns in contrast with merely looking at the cold pages
of an appellate record.” United States v. Eddy, 8 F.3d 577,
582-83 (7th Cir. 1993) (internal quotation marks and
citations omitted). A credibility determination by a district
court using the preponderance standard cannot be chal-
lenged on appeal “unless the court credited testimony that
was essentially unbelievable as a matter of law.” United
States v. Smith, 308 F.3d 726, 746 (7th Cir. 2002). In order
for testimony to be found incredible as a matter of law, “ ‘it
must have been either physically impossible for the witness
to observe that which he or she claims occurred, or impossi-
6 No. 03-1471
ble under the laws of nature for the occurrence to have
taken place at all.’ ” United States v. McEntire, 153 F.3d
424, 435 (7th Cir. 1998) (quoting United States v. Dunigan,
884 F.2d 1149, 1152 (7th Cir. 1990)).
Ortiz argues that Ripoll’s testimony is incredible because
of some inconsistencies of Ripoll’s testimony. Ripoll testified
initially that he saw Ortiz make one purchase of cocaine
from Zambrana in 1997. The next purchase Ripoll observed
was over a year later in the summer of 1998. Then, after a
gap of a couple of months, Ripoll saw Ortiz thereafter
purchase from Zambrana weekly, or every two or three
weeks. However, later in Ortiz’s testimony he said that he
saw Ortiz purchase cocaine from Zambrana weekly. Ortiz
also argues that, according to the presentence report, Ortiz
initially told the DEA that Ortiz had purchased 15 kilo-
grams of cocaine; however, while testifying, this number
mushroomed to 100 kilograms. Although this testimony is
troubling, it does not meet the standard mandating that we
deem it incredible as a matter of law, and we decline to
second-guess the credibility findings of the trial judge, who
had the opportunity to observe Ripoll firsthand. As we have
held, when making a credibility determination, the sentenc-
ing court, “may credit testimony that is ‘totally uncorrobo-
rated and comes from an admitted liar, convicted felon, or
large scale drug-dealing, paid government informant.’ ”
United States v. White, 360 F.3d 718, 720 (7th Cir. 2004)
(quoting Blalock, 321 F.3d at 690).
C. Relevant Conduct Determination Was Error
We find that the district court clearly erred when it
concluded that Ripoll’s allegations concerning the additional
100 kilograms of cocaine constituted relevant conduct. We
review a district court’s calculation of the quantity of drugs
involved in an offense for clear error. United States v.
Bacallao, 149 F.3d 717, 719 (7th Cir. 1998). A finding of fact
No. 03-1471 7
is clearly erroneous when “although there is evidence to
support it, the reviewing court on the entire evidence is left
with the definite and firm conviction that a mistake has
been committed.” United States v. McEntire, 153 F.3d 424,
431 (7th Cir. 1998) (quoting United States v. Gypsum Co.,
333 U.S. 364, 395 (1948)).
In calculating a defendant’s base offense level under the
now-advisory Sentencing Guidelines, “the sentencing
court must consider types and quantities of drugs not
specified in the counts of conviction but that were ‘part of
the same course of conduct or common scheme or plan’ as
the convicted offenses.” United States v. Beler, 20 F.3d 1428,
1431 (7th Cir. 1994) (citations omitted) (quoting U.S.S.G.
§ 1B1.3(a)(2)). In United States v. Duarte, we noted that this
“relevant conduct” or “aggregation rule” “grants the govern-
ment a fearsome tool in drug cases. It permits prosecutors
to ‘indict defendants on relatively minor offenses and then
seek enhanced sentences later by asserting that the defen-
dant has committed other more serious crimes for which, for
whatever reason, the defendant was not prosecuted and has
not been convicted.’ ” 950 F.2d 1255, 1263 (7th Cir. 1991).
However, the relevant conduct rule has limits. The rule
allows sentencing courts to consider quantities of drugs not
specified in the counts of conviction, provided “the uncon-
victed activities bore the necessary relation to the convicted
offense.” Id. Two or more offenses are part of a common
scheme or plan if they are connected by at least one com-
mon factor, such as “common victims, common accomplices,
common purpose, or similar modus operandi.” U.S.S.G.
§ 1B1.3(a)(2), App. Note 9.
In assessing whether offenses are part of the same course
of conduct, we look to whether there is “a strong relation-
ship between the uncharged conduct and the convicted
offense, focusing on whether the government
has demonstrated a significant ‘similarity, regularity,
and temporal proximity.’ ” United States v. Acosta, 85 F.3d
8 No. 03-1471
275, 281 (7th Cir. 1996). Offenses are part of the same
course of conduct if they are “part of a single episode, spree,
or ongoing series of offenses.” U.S.S.G. § 1B1.3(a)(2), App.
Note 9. Moreover, “section 1B1.3(a)(2) must not be read to
encompass any offense that is similar in kind to the offense
of conviction but that does not bear the required relation-
ship to that offense.” United States v. Patel, 131 F.3d 1195,
1204 (7th Cir. 1997); see also United States v. White, 888
F.2d 490, 500 (7th Cir. 1989). We have held that the mere
fact that the defendant may have engaged in other drug
transactions “is not sufficient to justify treating those
transactions as ‘relevant conduct’ for sentencing purposes.”
United States v. Crockett, 82 F.3d 722, 730 (7th Cir. 1996).
In this case, we are not convinced that the aggregated
relevant conduct in question is sufficiently intertwined with
the offense of conviction. See Bacallao, 149 F.3d at 721. To
begin, there is no temporal proximity between the crimes to
which Ortiz pled guilty and the relevant conduct which the
district court attributed to Ortiz. Ripoll’s testimony provides
no specific dates for any of the alleged cocaine purchases by
Ortiz, other than the loose time frame of “1997 through
1999.” Ripoll testified that he first observed Ortiz purchase
cocaine from Zambrana in “early 1997", but the next time
he supposedly observed Ortiz purchase drugs from
Zambrana was not until the “summer of 1998", over a year
later. There is, at a minimum, a ten-month gap between
Ripoll’s arrest in December 1999 and Ortiz’s first offense on
September 21, 2000, which the government concedes. Such
a temporal gap suggests the lack of a common plan or
course of conduct. See United States v. Sykes, 7 F.3d 1331,
1337 (7th Cir. 1993) (temporal gap of 14 months “tends to
indicate conduct that can easily be separated into ‘discrete,
identifiable units’ rather than behavior that is part of the
same course of conduct or common scheme or plan”) (quot-
ing U.S.S.G. § 1B1.3 background comment); see also United
States v. Mullins, 971 F.2d 1138, 1144 (4th Cir. 1992)
No. 03-1471 9
(temporal proximity “extremely weak” where uncharged
conduct occurred six months prior to offense of conviction);
United States v. Hahn, 960 F.2d 903, 911 (9th Cir. 1992)
(evidence of specific similarity and regularity important
where period of five months separated drug transactions);
United States v. Jones, 948 F.2d 732, 737-38 (D.C. Cir.
1991) (embezzlement that occurred over one year before
mailbag fraud not part of same course of conduct or common
plan).
The government argues that this temporal gap problem
can be explained if we make the assumption that Ortiz was
forced to find another supplier after Ripoll’s arrest. How-
ever, the record simply does not indicate that this was the
case, and we refuse to make such an assumption. The
government relies on our holdings in United States v. Ruiz,
178 F.3d 877, 882 (7th Cir. 1999), and Sumner, 325 F.3d at
886 for this proposition. We find the government’s reliance
on these cases unpersuasive. Although we did not remand
in Ruiz because the error there did not affect the defen-
dant’s sentencing range, we did find that the prior drug
activities at issue could not be considered for sentencing
purposes as additional relevant conduct. 178 F.3d at 882.
As in this case, in Ruiz we noted that the government was
attempting to link drug transactions “on some occasions” to
behavior that involved weekly transactions. See id. at 880,
882. In Sumner, we held that the defendant’s crack cocaine
dealings were sufficiently similar and temporally proximate
to the relevant conduct the district court found. However, in
that case, the defendant specifically admitted that the
supplier who had been incarcerated was supplying him
drugs before his arrest. There is no such link here.
We have held that without temporal proximity, the
government needs a stronger showing regarding the other
course of conduct factors, such as regularity or similarity of
acts. Sumner, 265 F.3d at 541; Ruiz, 178 F.3d at 882 (7th
Cir. 1999) (“If the prior incidents are remote in time, a
10 No. 03-1471
stronger showing of regularity and similarity may
be necessary to support a determination of a single
course of conduct.”). Here, there is no significant simi-
larity or regularity between Ripoll’s allegations and
Ortiz’s convicted offenses. The regular weekly purchasing
activity Ripoll described in his testimony was part of a
major, large-scale drug trafficking conspiracy extending
throughout Indiana, Michigan, and Illinois. This drug
trafficking ring ended in December 1999, with the arrest of
Ripoll and others. In comparison, Ortiz’s charged offenses
consisted of three drug sales that took place over a six-
month time span. The sales all took place at one location,
the Lake Station car repair shop. The sales only involved
Ortiz and the DEA’s confidential informant. Additionally,
while Ripoll describes Ortiz as exclusively purchasing
cocaine, one of Ortiz’s convictions involves a different drug,
marijuana. Most damning to the government, however, is
that Ortiz’s three sales occurred in 2000 and 2001, long
after the Zambrana/Ripoll conspiracy had been exposed.
The quantity of cocaine involved in the charged offenses
and the alleged relevant conduct is also different. Ripoll
describes Ortiz as purchasing between one and three
kilograms of cocaine a week throughout 1997 to 1999. The
two controlled purchases of cocaine between Ortiz and the
DEA’s confidential informant that took place in January
and March 2001 equaled 10 ounces.
In addition, we find nothing in the record indicating that
the alleged weekly purchases of cocaine from Ripoll and
Zambrana involved the same purpose or modus operandi as
Ortiz’s convicted offenses. See Bacallao, 149 F.3d at 719(stating courts cannot consider additional drug purchases
when there is “no explanation indicating how the alleged
purchase involved the same purpose or modus operandi
as the convicted offense”). The convicted offenses here do
not involve the same participants as the activities described
by Ripoll. See Ruiz, 178 F.3d at 882 (finding that different
No. 03-1471 11
participants indicated that transactions were not part of
same conduct or scheme, even if transactions were similar).
When we compare Ortiz’s role in his convicted offenses to
those of the alleged relevant conduct, we also see substan-
tial differences. Ortiz pled guilty to selling marijuana once
and relatively small amounts (when compared to 100
kilograms) of cocaine twice. However, according to Ripoll,
Ortiz purchased large quantities of cocaine on a weekly
basis. As such, we find the government’s evidence that the
relevant conduct involved the same purpose or modus
operandi non-existent insufficient.
Finally, the district court did not make specific findings
on the issue of whether Ripoll’s allegations involved conduct
relevant to the convicted offense.1 As we have noted before,
the government’s burden at sentencing is considerably
lightened because of the preponderance of the evidence
standard and the relaxed evidentiary rules that govern
sentencing. However, we have also held that the relevant
conduct rule is “not without limits” and “because its
application so favors the government,” we insist that courts
be “scrupulous to ensure that the government has adhered
to those limits.” Beler, 20 F.3d at 1432. One of the ways in
which we ensure that these limits are maintained is by
requiring sentencing courts to “explicitly state and support,
1
The district court, in making its relevant conduct finding, stated
only the following:
As to the objection of the Defendant as to relevant conduct,
and actually we can run that with the base offense level
together. All my findings here are by a preponderance of
the credible evidence that the court has in front of it. The
court does find that the testimony of Carlos Ripoll—I find
that testimony to be very credible, so, the defendant should
be held responsible for at least a hundred kilograms of
cocaine as relevant conduct.
Sentencing Hr’g Tr., Vol. II at 21.
12 No. 03-1471
either at the sentencing hearing or (preferably) in a written
statement of reasons, the finding that the unconvicted
activities bore the necessary relation to the convicted
offense.” Id. (citing Duarte, 950 F.2d at 1263). The district
court’s relevant conduct decision seems solely based on
Ripoll’s testimony at the sentencing hearing. The district
court did not address the fact that Ripoll’s assertions
regarding over 100 kilograms of cocaine purchases from
1997 through 1999 do not appear anywhere in the
presentencing report. Most importantly, the district court
did not address any issues of temporal proximity, similarity,
regularity, or modus operandi and failed to explain how the
events to which Ripoll testified were related to the conduct
to which Ortiz pled guilty. The district court’s terse find-
ings, combined with our analysis examining the temporal
proximity, similarity, regularity, and modus operandi of
Ortiz’s alleged relevant conduct, all lead us to conclude that
the district court’s finding that Ortiz was responsible for
100 kilograms of cocaine as relevant conduct was clearly
erroroneous.
D. The District Court’s Additional Sentencing Deter-
minations
We find that the district court also erred by denying Ortiz
a downward adjustment of three points for demonstrat-
ing acceptance of responsibility, pursuant to U.S.S.G.
§ 3E1.1(b)(1), and by adding two points for activity occur-
ring during supervised release. We review both the district
court’s acceptance of responsibility and supervised re-
lease factual findings for clear error. United States v.
Wetwattana, 94 F.3d 280, 285 (7th Cir. 1996); United States
v. Trotter, 270 F.3d 1150, 1153 (7th Cir. 2001). The district
court made both of these determinations based exclusively
on the alleged relevant conduct at issue here. Because we
have already determined that the government’s allegations
No. 03-1471 13
against Ortiz do not constitute relevant conduct, it follows
that the district court’s acceptance of responsibility and
supervised release findings are also clearly erroneous.
E. Ortiz’s Booker Arguments
Ortiz also argues that his Sixth Amendment rights
were violated when the district judge made a finding by
a preponderance of the evidence regarding Ortiz’s alleged
relevant conduct. See Booker, 125 S. Ct. at 756. We are
already remanding this case based on our finding that
the district court clearly erred in its relevant conduct
findings. Ortiz must be resentenced in accordance with
Booker at that time, obviating the need for us to con-
sider the propriety of a limited remand. See Paladino, 401
F.3d at 484.
III. CONCLUSION
For the reasons stated above, we VACATE Ortiz’s sentence
and REMAND for resentencing in accordance with this
opinion.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—12-12-05