USCA1 Opinion

UNITED STATES COURT OF APPEALS

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT
____________________

No. 94-1922

UNITED STATES OF AMERICA,

Appellee,

v.

LONDON EGEMONYE,

Defendant, Appellant.

____________________

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Joseph L. Tauro, U.S. District Judge]

___________________

____________________

Before

Cyr, Circuit Judge,

_____________

Bownes, Senior Circuit Judge,

____________________

and Boudin, Circuit Judge.

_____________

____________________

Joan M. Griffin, by Appointment of

_______________

the Court, with whom

Casne
_____

Edwards was on brief for appellant.

_______
James F. Lang,
_______________

Assistant

United

States

Attorney,

with

Donald K. Stern, United States

_______________

Attorney, was on brief for

States.

____________________

August 3, 1995
____________________

the Uni

BOUDIN, Circuit Judge.

_____________

1993 under

London Egemonye was indicted in

a multi-count indictment charging

him and others

with conspiracy and other offenses relating to the possession

and

use

of

other people's

1029(a)(2)(trafficking,

credit

fraud

cards.

and

18 U.S.C.

use),

1029(a)(3)

(possession with intent to defraud), 1029(b)(2) (conspiracy).

On June

10,

counts,

and he now appeals from his sentence arguing that it

is flawed

by

1994,

Egemonye entered

the government's

guilty

manipulation

pleas

of

to

all

sentencing

factors and by an improper computation of loss.

Because

there

was

no

trial,

primarily from the recitations at

presentence report,

hearing.

and from

we

derive

the

facts

the plea hearing, from the

submissions at

the sentencing

United States v. Connell, 960 F.2d 191, 192-93 (1st

_____________

Cir.

1992).

conducted

The

_______

case arose

by a joint

out

of

a sting

operation

federal-state task force investigating

credit card and other financial fraud in

Massachusetts.

The

critical events took place in January and February 1993.

Robert

Leslie,

introduced Egemonye

both

who was

to an undercover state

only as "Kathy."

Egemonye

with two

BayBank Visa

$7,450

driver's

cooperating

On January 21,

BayBank MasterCard

credit card with

for all

three

licenses

cards.

in the

trooper known to

1993, Kathy supplied

credit cards

an aggregate credit

Egemonye then

credit-card

-2-2-

with authorities,

and one

limit of

created false

names, each

license

bearing

Leslie's

photograph,

and

drove

Leslie

to

three

different banks to obtain cash advances of $6,900.

Egemonye purchased four more

January 29, 1993,

aggregate limits

$21,000

and

transactions,

and four more

on the cards

$14,000,

several

credit cards from Kathy on

on February 2,

in the two

respectively.

of

the

1993.

The

transactions were

In

cards were

between

used

to

these

obtain

advances

from

banks,

conspiracy engineered

accounts

and

Egemonye

deposits

of individual

and

of some

card holders

others

in

stolen checks

to boost

the

into

the depleted

credit available for those cards.

Until the fourth transaction,

exchange for a share of

proposed that

the proceeds, but on February

she be paid

said, "I'm not going

Kathy made the "sales" in

a flat

$200 per card.

to buy one card for two

It has to be like ten."

On February 10,

5 she

Egemonye

hundred. . . .

Kathy told Egemonye

that she expected to receive a number of cards that day, that

Egemonye should bring $2,000 for 10 cards, and that she would

"front" (finance) any additional cards and accept payment for

them later.

Egemonye agreed, subject to his

examination of

the cards.

When Kathy

that

and Egemonye met later that

she had a bag full

he knew

said, "I

of cards and asked Egemonye whether

of another buyer

probably can

day, Kathy said

if he did not

handle them,"

-3-3-

want them all.

and proceeded to

He

give

Kathy $2,000 down, and a promise of $6,000 more later, for 40

Household

Bank

Visa and

aggregate

limit

of

MasterCard

$200,000.

immediately thereafter, followed

credit

cards with

Egemonye

was

by the indictment

an

arrested

and plea

already described.

At

offense

sentencing, the

district court

by

U.S.S.G.

2F1.1(a), (b)(1)(H).

at $242,950,

credit

the

court

to Egemonye

was

over

The

not here

purchased

from

Kathy

offense level was then

in dispute,

$200,000.

The court computed the loss

representing the aggregate credit

cards

transactions.

respects,

base

level of 6 by 8 additional levels because the "loss"

attributed

51

increased the

limit of the

in

the

four

adjusted in other

and Egemonye

was sentenced

within the guideline range to 37 months' imprisonment.

1. On appeal, Egemonye's first claim is directed

40

cards supplied to him in the final transaction.

contends

that

including

these

40

cards

calculation condones "blatant sentencing

in

at the

Egemonye

the

loss

factor manipulation

engaged in by the investigating agents" and is a violation of

constitutional due process.

He relies on several decisions,

including United States v. Connell,

______________
_______

960 F.2d 191,

196 (1st

Cir. 1992).

We have recently had occasion to discuss Connell and the

_______

other

decisions

sentencing

in

this

circuit

factor manipulation.

that

have

United States
_____________

addressed

v. Montoya,
_______

-4-4-

No. 94-1666, et al.,

______

the prior cases,

court

Summarizing

we said that "where government

improperly enlarged
__________

sentencing

(1st Cir. July 27, 1995).

the scope

has

power

or scale

to

of the

exclude

agents have

crime," the

"the

tainted

transaction" from the guideline computations and for purposes

of

any mandatory

minimum

statute.

Montoya, slip
_______

op. 6-7

(quoting in part Connell, 960 F.2d at 195).

_______

However, recognizing the

government

stressed

in

that

investigating

it

was

only

broad latitude allowed to

and

suppressing

"extraordinary

the

crime,

we

misconduct" by

agents that could give rise to such an exclusion, which would

occur

in the

Congress.

States v.
______

teeth of

a statute

or guideline

approved by

Montoya, slip op. at 7-8, (quoting in part United

_______
______

Gibbens, 25 F.3d 28,

_______

31 (1st Cir. 1994)).

While

something less than a constitutional violation might suffice,

as

extraordinary misconduct,

Egemonye's

reference

to

due

process concepts is certainly in the ballpark.

In Montoya, as in previous cases, we refused to lay down

_______

fixed rules to define

sentence factor manipulation, but said

that the focus is normally upon the conduct of the government

rather

does not

than the defendant.

Slip op. at 8.

claim that his will

was overborne or deny

was predisposed to the offense.

the

fourth transaction

had

Indeed, Egemonye

that he

What Egemonye claims is that

no legitimate

law

enforcement

purpose and was designed solely to boost his federal sentence

-5-5-

because government agents were unhappy with lenient treatment

that Egemonye earlier received in state court.

There is some

agents

were

basis for the suggestion

unhappy

the

with

words of

Egemonye's

believed,

in

one

[earlier]

got off lightly for his

of

that task force

prior

the

record

agents, "that

criminal activity."

and

he

That

criminal record, according to the agent just quoted, involved

history of

traced back

credit card

to 1990 and

fraud by

Egemonye that

involved a number

could be

of transactions.

On this appeal, the government is prepared to assume arguendo

________

that the background

facts, "viewed collectively,

could call

the government's motives into question to some extent."

Nonetheless,

the

government says

were clearly appropriate in

conspirators, which they

cards, the

government

of

did.

As

to the final

that it

which was "to

the defendant's criminality."

that this "parameters" explanation

could

multiple sales

order to identify Egemonye's co-

insists

investigatory purpose"

that

too

sale of

"had

40

valid

explore the parameters

Egemonye's counsel replies

has no real substance and

be used to enlarge a defendant's sentence to virtually

any height whatever.

We think that Egemonye's reply has some

force but overstates the matter.

There

is, it

should

Egemonye was coerced or

be stressed,

no indication

pressured to achieve a new

that

level of

crime.

True,

the

fourth sale

was

much larger

than

the

-6-6-

earlier

Egemonye.

cards for

ones; but agent Kathy did

On the contrary, he

the new $200 per

not force the 40 cards on

had insisted on

at least 10

card payment ("I'm not

buy one card for two hundred. . . .

going to

It has to be like ten.")

And when offered a

he

bag full of cards--with the

recommend another

buyer

for those

he did

request that

not want--he

responded, "I probably can handle them," and took them all.

Government

suspect's largest

contours

of

agents

are

limited to

unsolicited crime.

the criminal

personnel--were,

not

replicating

In this case, the full

operation--its

size, techniques,

like an iceberg, largely submerged; and the

means of exploration were additional and larger transactions.

The first three transactions

the fourth,

provided

clearly served this purpose and

even though followed immediately

air-tight evidence

for trial

by the arrest,

that Egemonye

significant dealer and not a petty swindler.

was a

While the sting

could not be endlessly prolonged and enlarged, nothing in the

objective facts

suggests

"misconduct"

at

all,

let

alone

"extraordinary misconduct."

The question, then, is whether the fourth transaction is

tainted by

such

gray.

the agents'

matters contains

subjective motives.

not blacks and

Motives may be mixed;

The

pallet in

whites but

shades of

good and bad motives are often

matters of degree; and there can be multiple actors.

to consider subjective

motive at all

-7-7-

Whether

presents a problem

of

policy.

Compare
_______

Harlow v. Fitzgerald,
______
__________

so

in the

qualified

to

Still, we

would be

available

showed that a plainly improper subjective motive--

greatly concerned if

racial hostility

or personal

immunity

(1982)

(refusing

say,

do

457 U.S. 800

context).

evidence otherwise

animus--had

enlarged or

prolonged the sting.

But this is not such a case.

About the most that can be

derived from the record, drawing all reasonable inferences in

favor of Egemonye, is

was an established and

that the agents thought that

Egemonye

unrepentant defrauder who had escaped

serious

With

punishment for

this in

involved no

mind, they

series of

conducted a

pressure whatever

four transactions,

and

past, similar

frauds.

sting operation

on Egemonye, lasted

garnered several

other

that

for only

defendants.

The first three transactions involved 11 cards; the last one,

40.

This is a sizeable jump but hardly extraordinary.

That

selecting

commonplace

agents

him

considered

for

of

overtures

law

frequently target those

by

the

enforcement.

past

task

record

force

Undercover

and the

activities gave the agents some

that Egemonye was

Fed.

is

in

operations

who are suspected of crime,

recent history of fraudulent

reason to think

Egemonye's

R.

not only predisposed

actively

engaged.

Evid.

404(a),

character

evidence to show propensity, is

but

restricting

a rule for trials

and not the conduct of police investigations.

At

worst, the

-8-8-

agents went

too far if

themselves entitled

punishments.

dubious

and to the extent

to make

up for any

that they thought

shortfall in

prior

But the line is thin and blurred between such a

motive and

simple

desire

to

be

sure

that

committed

criminal is

caught

and tried

for a

unshakeable

evidence.

And,

offense

based on

already

held, Egemonye

sting

objectively

circumstances,

mixed

and

was

reasonable

legitimately

in

even assuming that

not of

as we

have

targeted and

extent.

Under

the agents'

crystalline purity,

substantial

we see

the

these

motives were

nothing that

would require a curtailment of the sentence.

2.

Egemonye's second challenge to his sentence concerns

the district court's computation of loss.

As already

the governing

level primarily to

guideline keys the offense

"the loss" caused by the offense, U.S.S.G.

table),

but goes

on to

intended loss should

provide (id.,
___

be used

if it is

noted,

2F1.1(b)(1)(loss

comment

(n.7)) that

greater than

actual

loss:

Consistent

with the provisions of

Solicitation

or Conspiracy),

2X1.1 (Attempt,

if an

intended loss

that the defendant was attempting to inflict can be

determined,

this

figure will

greater than the actual

if the fraud consisted
sell $40,000 in

be

used

loss. . . .

if it

is

For example,

of selling or attempting to

worthless securities .

. . .

the

loss would be $40,000.

In

court

accord with

in this case

the

presentence

report, the

attributed to Egemonye

equal to the aggregate limits

district

an intended loss

of the purchased credit cards.

-9-9-

A reading of

the transcript indicates

that the judge

found

that Egemonye was capable of and intended to use the cards to

secure amounts at or virtually at their aggregate limits.

review

such a

factual determination

United States v.
______________

Pavao, 948
_____

F.2d 74,

only for

77 (1st

We

clear error,

Cir. 1991),

reserving for closer scrutiny a buried legal issue shortly to

be described.

On the factual issue of intended use and capability, the

government bears the burden

of proof because an increase

in

the offense level was sought, see United States v. Sklar, 920
___ _____________
_____

F.2d 107,

112

cautions

that a

U.S.S.G.

(1st Cir.

1990),

reasonable estimate

2F1.1 comment. (n.8).

out that he realized

card limits

transactions

but the

from

guideline

of loss

cards

and nothing

involved in

at all

will suffice.

Egemonye begins by pointing

only about 53 percent of

the

itself

from the

the

the aggregate

first

three

final

bagful of

cards since he was apprehended almost immediately.

He argues

that to predict a 100 percent recovery is simply unrealistic.

Unfortunately

evidence

that he

for

Egemonye,

instructed his

there

runners

was

affirmative

at the

outset to

procure cash

from

the banks

at

addition, he arranged

or virtually

at the

for the deposit of

card

limits.

In

stolen checks into

some of the accounts, in

this means, some of

order to refresh their limits.

the accounts could have been

By

milked for

-10-10-

amounts

in excess of their aggregate limits.

figure represented only the

The 53 percent

amount that Egemonye had secured

at the time his scheme was interrupted by arrest.

See United
___ ______

States v. Strozier, 981 F.2d 281, 284 (7th Cir. 1992).

______
________

In

intent

sum, taking

the issue

and capability, we do

purely as

a factual

not think that

one of

on this record

the use of the aggregate card limits as a measure of intended

and

potential loss was

good evidence

clearly erroneous.

Where

there is

of actual intent and some prospect of success,

we do not think that a court needs to engage

in more refined

forecasts of just how successful the scheme was likely to be.

See United States v. Lorenzo, 995 F.2d 1448, 1460 (9th Cir.),
___ _____________
_______

cert. denied,
_____ ______

114 S. Ct. 225

(1993).

The

situation may be

quite difficult where intent must be inferred solely from the

likely effects of the scheme.

See United States v. Stern, 13

___ _____________
_____

F.2d 489 (1st Cir. 1994).

But there is a

U.S.S.G.

pertinent

wrinkle.

2F1.1's

There is a

application

part) to U.S.S.G.

such cross-reference

note 7

cross-reference in

(quoted

2X1.1; and there

in application note 9,

above

is a second

which reads (in

pertinent part):

"In

the

(e.g., an

case

for

offense

completed

offense

larger, attempted fraud), the offense

to be

provisions of
is

a partially

offense involving a completed fraud that

is part of a
level is

of

the

determined in accordance
2X1.1 . . .

substantive

with the

whether the conviction

offense,

. . ., or both."

-11-11-

the

in

inchoate

Egemonye's

counsel

argues

that

section

2X1.1,

and

the

discount it makes available, apply in this case.

U.S.S.G.

offense

at

2X1.1

concerned

with

determining the

level for an attempt or conspiracy; and this it sets

_______
__________

three

levels

substantive

less

than

offense--unless

conspirators)

necessary

is

for

have

completed

the substantive

the

the

all

offense

level

for

the

defendant

(or

his

co-

acts

believed

of

offense

the

or

were "about

to

complete all such acts"

the

"unless"

represent

clause--which

"most"

Effectively, the

discount

if

when apprehended.

he

the

cases--there

For cases

background

is

no

within

comment

such

says

discount.

guideline gives the defendant a three-level

is

some

distance

from

completing

the

substantive crime.

Read

literally, section

present case

involved

because 14

completed

of the

substantive

trafficking in unauthorized

driver's

completed

licenses, and

crimes.

2X1.1 is

not relevant

15 counts against

offenses,

credit cards to

the conspiracy

thus

to the

Egemonye

ranging

from

producing false

embraced fully

On the other hand, the cross-reference to

section 2X1.1 in section 2F1.1 arguably connects the intended

loss

concept to

the

attempt guideline,

and section

2X1.1

blurs the matter further

with the following application note

(comment. (n.4)), providing (in pertinent part):

In

certain

cases,

the

participants

may

have

completed . . . . all of the acts necessary for the

-12-12-

successful completion of part,

intended offense.

but not all, of the

In such cases, the offense level

for the count (or group of closely related multiple

counts) is

whichever of the following

the offense level for

levels . . . or
the offense
completed
offense

which

. . . .
the

participants
necessary to

the intended offense minus 3

the offense level for the part

for

was

is greater:

the

necessary

acts

of
were

For example, where the intended

theft

completed

of
.

$800,000

steal $30,000,

only

the offense

but

the

the

acts

level is

the offense level for the theft of $800,000 minus 3

levels,

or

the offense

level

for

the theft

of

$30,000, whichever is greater.

Interpreting

difficulty,

these

and the

provisions

only cases

is

in point

Compare United States v. Watkins,

_______ ______________
_______

994 F.2d

matter

are in

of

some

conflict.

1192 (6th

Cir.

1993)

with United States v. Strozier, 981 F.2d 281 (7th Cir.

____ _____________
________

1992)

The problem, in a nutshell, is that section 2X1.1

on

its

face

nothing to

do

with

offense or a conspiracy that has

has

completed substantive

been carried to completion.

On the other hand, the notion of a discount could be extended

________

from the case of an incomplete offense to that of a completed

offense where intended harm

is part of the calculus

and the

harm is only partly completed.

Recognizing the question to be close, we are inclined to

stand by the

literal language of the guidelines that directs

section 2X1.1 to cases where the substantive

been completed.

Cir.

is

the

1995).

offense has not

E.g., United States v. Sung, 51 F.3d 92 (7th

____ _____________
____

The argument for a discount for inchoate crimes

obvious; the defendant

substantive crime

but

has started down

has not

-13-13-

gotten

the road toward

there yet

and,

whatever his intention, might still turn back before crossing

the

line.

By

contrast, Egemonye

commit

the

substantive crime

making

the

false documents,

by

so

did

cross the

acquiring

the basic

line and

the cards

purpose

and

of the

section 2X1.1 discount has nothing to do with him.

Where

a completed

rational to measure

offense

is involved,

it is

surely

culpability in part by the intended harm

and to refuse a

though

discount where the offense is

the intended

harm has

From the standpoint of

is

inflicted

influenced

sentences

fully realized.

moral guilt, and dangerousness, there

little to distinguish such

actually

not yet been

complete even

the same

a defendant from

amount of

one who has

harm.

And

we are

in part by the fact that the case law calculating

based

on intended

harm,

most

of it

admittedly

without making reference to section 2X1.1, is consistent with

this view.

E.g., United States v.

____ _____________

Guyon, 27 F.3d
_____

Cir. 1994); United States v. Resurreccion, 978

_____________
____________

723 (1st

F.2d 759 (1st

Cir. 1992).

Of course, there would be nothing irrational in deciding

that

actual harm is worse than intended harm and providing a

three-level discount

offense is

not

wherever the

measured in part by

sentence for

intended harm.

a completed

But

this is

in general the philosophy of the guidelines; if it were,

possession

punished

of

drugs

with

intent to

less harshly than the

-14-14-

distribute

would

be

actual sale of an equivalent

amount.

The

wrinkle of

section

2X1.1

cannot be

completely smooth, but the pertinent language

ironed

already quoted

can in fact be squared with our result.

Thus, the cross-references

in section 2F1.1

are easily

explained; they do invoke the discount, or the possibility of

discount, where the underlying crime

or conspiracy.

Application

is merely an attempt

note 4 in section 2X1.1

is less

easily reconciled; but we think the difference is that in the

theft

case, there

amount

but

only

contrast, all 51 of

is no

(in

completed crime

substance)

an

as to

attempt.

the cards were the subject

the larger

Here,

by

of completed

crimes.

Egemonye's remaining

claim as to loss is

to argue that

no

consideration

should be

given to

the

40 cards

in the

fourth transaction,

or at least

to the unexpected

30 cards

(over and above the

ten cards Egemonye requested).

This is

largely

a restatement

of the

claim that

manipulation occurred.

Having

rejected that claim, we think

that--from

the standpoint

of

intended

sentencing factor

loss--Egemonye

can

fairly be charged with intending to inflict loss as to all of

the cards.

Both issues

We

are thus

briefing

Sentencing

in this

especially

and

case are difficult

indebted to

counsel

for the

able

both

sides.

The

argument

presented

on

Commission's

attention

will

-15-15-

and important.

be

drawn

to

the

arguable

lack of

clarity in

2F1.1 and section 2X1.1.

Affirmed.
_________

the interplay

between section

-16-16-