United States v. Martinez

FILED
United States Court of Appeals
Tenth Circuit

June 28, 2010
PUBLISH Elisabeth A. Shumaker
Clerk of Court
UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

UNITED STATES OF AMERICA,

Plaintiff-Appellee,
v. No. 09-2117
TOBY MARTINEZ,

Defendant-Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
(D.C. No. 1:07-CR-00615-WJ-1)

Brian A. Pori of Inocenté P.C., Albuquerque, New Mexico, for Defendant-
Appellant.

Jonathon M. Gerson, Assistant United States Attorney, (Gregory J. Fouratt,
United States Attorney, and Paula G. Burnett, Assistant United States Attorney,
with him on the brief), Albuquerque, New Mexico, for Plaintiff-Appellee.

Before BRISCOE, Chief Judge, McWILLIAMS, and TYMKOVICH, Circuit
Judges.

BRISCOE, Chief Judge.
 Defendant-Appellant Toby Martinez was convicted of one count of

conspiring to defraud the State of New Mexico during the construction of the

Bernalillo County Metropolitan Courthouse in Albuquerque, in violation of 18

U.S.C. § 371, and two counts of mail fraud committed in furtherance of that

fraudulent scheme, in violation of 18 U.S.C. §§ 1341 and 1346. The district court

sentenced Martinez to 67 months’ imprisonment, and pursuant to the Mandatory

Victims Restitution Act of 1996 (“MVRA”), 18 U.S.C. §§ 3663A, 3664, imposed

restitution in the amount of $2,710,818.66 to the State of New Mexico. On

appeal, Martinez challenges the reasonableness of his sentence and several

aspects of the district court’s restitution order. Exercising jurisdiction under 28

U.S.C. § 1291 and 18 U.S.C. § 3742(a), we affirm.

I

The participants in the Bernalillo County Metropolitan Courthouse

conspiracy defrauded the State of New Mexico through the submission of over-

billings from two components of the construction of that facility: the architectural

design of the courthouse and the installation of an audiovisual system. Martinez

played a central role in the conspiracy: serving as the Metropolitan Court

Administrator until June 2003, Martinez approved the invoices that fraudulently

exaggerated the cost of services rendered. All told, the district court found that

the conspiracy caused a total loss of $4,374,286.64 to the State of New Mexico.

The architectural design aspect of this conspiracy began shortly after the

2
New Mexico State Legislature enacted a bill providing for the construction of a

new Bernalillo County Metropolitan Courthouse in 1998. Martinez and a judge

on the Metropolitan Court consulted with Manny Aragon, who was at that time

the President Pro-Tem of the New Mexico State Senate. Aragon suggested that

Design Collaborative Southwest (“DCSW”) be hired to complete the architectural

design of the courthouse. DCSW was later awarded the contract in 1999: Marc

Schiff, a DCSW partner, oversaw the contract, and Kenneth Schultz, a former

mayor of Albuquerque, was hired by DCSW as a lobbyist. Aragon, Martinez,

Schiff, and Schultz conspired to defraud the State of New Mexico through

fraudulent over-billings. Schiff submitted inflated invoices, Martinez approved

them, and cash payments were distributed among the conspirators. The district

court found that the architectural design aspect of the conspiracy resulted in a

total loss of $918,015.38 to the State of New Mexico. Of that amount, Martinez

admitted to receiving $150,000, Schultz admitted to receiving $50,000, Schiff

kept at least $136,645.38, and Aragon received at least $40,000. These

distributions left an unaccounted shortfall of $541,370 that the Government could

not attribute to any one of these particular individuals.

The audiovisual aspect of the conspiracy began in 2001, when Aragon and

Martinez discussed the possibility of obtaining additional state funding to install

an audiovisual system. Raul Parra, who was a partner in the engineering firm

P2RS, “lined up the contractor and the subcontractors to perform the work on the

3
audio-visual contract.” R. Vol. 1 at 206. Manuel Guara, the owner of a

subcontractor company named Datcom, submitted inflated invoices to the general

contractor; the general contractor incorporated Datcom’s invoices into its own

invoices that it submitted to Martinez for approval. Upon receiving payment,

Datcom transferred funds to Parra, who then distributed the proceeds among the

other conspirators. Martinez “created a shell company called Smart Solutions,

using [his] wife’s name, for the sole purpose of receiving proceeds of the inflated

audio-visual billings.” Id. at 207. When Martinez left his position as Courthouse

Administrator in June 2003, he “relied upon” Michael Murphy, the owner of the

company supervising the courthouse construction, to “make sure the inflated

[general contractor] invoices were approved for payment.” Id. Martinez

promised Murphy $20,000 for his cooperation.

The district court found that the total loss to the State of New Mexico

resulting from the audiovisual aspect of the conspiracy was $3,456,253.26. Of

that amount, the district court found Martinez responsible for $2,019,448.66,

Aragon for $609,272.32, Parra for $601,532.28, Sandra Martinez (Martinez’s

wife) for $106,000, Guara for $100,000, and Murphy for $20,000.

Evidence of this criminal conduct later surfaced in 2005, and in December

of that year the FBI confronted Martinez about the courthouse project. Martinez,

represented by counsel, gave the FBI a lengthy and detailed statement about the

entire conspiracy. His assistance was substantial: Martinez alerted the FBI to the

4
architectural design aspect, which had not yet been discovered, and convinced

Parra to cooperate. Shortly thereafter, Schiff, Schultz, and Guara all agreed to

cooperate, and each of these co-conspirators entered into pre-indictment plea

agreements.

In March 2007, a grand jury empaneled by the United States District Court

for the District of New Mexico returned a multiple count indictment against

Martinez and several co-conspirators. The fourth superseding indictment,

returned on October 8, 2008, charged Martinez, Sandra Martinez, Parra, Aragon,

and Murphy with a conspiracy to commit money laundering and mail fraud in

violation of 18 U.S.C. § 371, and also alleged multiple counts of mail fraud in

violation of 18 U.S.C. §§ 1341 and 1346, and multiple counts of money

laundering in violation of 18 U.S.C. §§ 1956 and 1957. The indictment alleged

that the conspiracy lasted from 1999 until January 2006, and also contained

allegations of forfeiture for Martinez, Sandra Martinez, and Aragon.

As part of its pretrial pleadings, the Government filed a notice of intent

pursuant to Federal Rule of Evidence 404(b) to introduce specific acts of

uncharged conduct that related to two other construction projects. First, the

Government sought to introduce evidence that during the earlier construction of

the New Mexico Second Judicial District Courthouse, a company that Parra at

least partly owned was paid for unnecessary data network design, and that there

was evidence tending to show that Parra paid Aragon $50,000. Id. at 51-52.

5
Second, the Government sought to introduce evidence that during the construction

of the Bernalillo County Metropolitan Detention Center, Parra convinced P2RS,

DCSW, and another company that it would be beneficial to pay Aragon thousands

of dollars to guarantee work on public construction contracts. Id. at 52-54. The

Government argued the prior acts were relevant to show “opportunity, knowledge,

intent, identity, preparation and planning, and absence of mistake . . . .” Id. at 48.

The district court initially ruled that most of this evidence was admissible, but

later reconsidered that ruling and excluded evidence relating to the construction

of the Metropolitan Detention Center.

On October 10, 2008, Martinez pleaded guilty to the conspiracy count and

to two counts of mail fraud pursuant to a cooperation agreement. In the plea

agreement, the parties entered into the following stipulations to assist the district

court in calculating Martinez’s advisory guideline range: Martinez should be

responsible for a loss amount between $1.5 and $2.5 million; Martinez was a

“public official in a high-level sensitive position,” and should receive a four-level

enhancement under U.S.S.G. § 2C1.1(b)(3); Martinez “did not supervise the

activities of his co-conspirators,” and should not receive an enhancement for his

role in the offense under U.S.S.G. § 3B1.1(a); Martinez should not receive an

enhancement for abuse of a position of trust under U.S.S.G. § 3B1.3 because he

was subject to an equivalent enhancement under U.S.S.G. § 2C1.1(b)(3). Id. at

210. Martinez reserved the right to argue that the 2000 version of the United

6
States Sentencing Guidelines should apply to his sentence, and agreed to forfeit

several of his assets to the federal government. Id. at 211, 215-16.

On October 14, 2008, Parra pleaded guilty pursuant to a cooperation

agreement under Federal Rule of Criminal Procedure 11(c)(1)(C) in which the

parties stipulated to a maximum term of imprisonment of 71 months. Id. at 235.

Parra was eventually sentenced to 46 months’ imprisonment. On October 15,

2008, Aragon pleaded guilty pursuant to a plea agreement under Rule 11(c)(1)(C)

in which the parties stipulated to a term of imprisonment of 67 months. Id. at

264.

Prior to Martinez’s sentencing, the Government filed a motion seeking a

reduction in Martinez’s sentence because of his substantial assistance, and a

United States Probation Officer prepared Martinez’s presentence report (PSR).

Using the 2008 version of the United States Sentencing Guidelines, the PSR

determined Martinez’s base offense level was 14 under U.S.S.G. § 2C1.1(a)(1),

applied a 16-level enhancement under § 2B1.1(b)(1) because Martinez was

responsible for a loss between $1.5 and $2.5 million, and applied a 4-level

enhancement under § 2C1.1(b)(3). When Martinez’s base offense level was

adjusted three levels for acceptance of responsibility, his total offense level was

31, which when combined with Martinez’s criminal history category I, produced a

guideline range of 108-135 months.

Martinez filed written objections to the PSR and raised several arguments

7
concerning the reasonableness of his guideline range and the amount of restitution

proposed. With respect to his guideline range, Martinez argued that the PSR

failed to account for the prior conduct of his co-conspirators, and therefore did

not consider Martinez as a latecomer to a conspiracy that had been initiated years

earlier. Martinez also argued that applying the 2008 version of the Guidelines

rather than the 2000 version violated the ex post facto clause, given the

substantially higher guideline range that resulted from the application of the 2008

version. Concerning his restitution obligation, Martinez argued that he received

only $155,000 from the architectural design aspect of the conspiracy, and should

not be jointly and severally liable for the $541,370 of unaccounted fraudulent

proceeds resulting from that aspect of the conspiracy. 1 Martinez also argued that

the district court should offset any restitution obligation by the value of the

property he forfeited to the federal government, by the federal and state taxes he

paid on the fraudulent proceeds, and by the money he paid and loaned to co-

conspirators. The Government opposed each of these arguments.

The district court conducted Martinez’s sentencing hearing on April 7,

2009. During the hearing, the Government offered the testimony of FBI Special

Agent Drew McCandless, who had previously testified during Aragon’s

1
This argument was in response to the Government’s restitution argument
that Martinez and his co-defendants should be jointly and severally liable for the
reasonably foreseeable losses to the State of New Mexico.

8
sentencing hearing concerning the loss amounts attributable to each co-

conspirator. During cross examination of Agent McCandless, Martinez’s counsel

attempted to inquire into the existence of a prior, ongoing conspiracy involving

Martinez’s co-conspirators, as well as any other benefit these co-conspirators

received from participating in the ongoing conspiracy. The Government objected

to these lines of inquiry as irrelevant, and the district court sustained the

Government’s objections for the most part.

In calculating Martinez’s advisory guideline range, the district court

concluded that it would apply the 2008 version of the Guidelines and not the 2000

version. The district court also rejected the parties’ plea agreement stipulation

that Martinez would not be subject to a role adjustment under U.S.S.G. §

3B1.1(a), and instead imposed a three-level enhancement for a managerial or

supervisory role under U.S.S.G. § 3B1.1(b). That enhancement increased

Martinez’s total offense level to 34, and produced a guideline range of 151-188

months. The district court granted the Government’s motion for a sentence

reduction for substantial assistance, and departed downward eight offense levels,

from 34 to 26, which produced a reduced guideline range of 63-78 months. The

district court then sentenced Martinez to a maximum term of 60 months’

imprisonment on the conspiracy count, and 67 months’ imprisonment on the mail

fraud counts, all terms to run concurrently. The district court acknowledged that

this was the same term of imprisonment Aragon received, and the court stated that

9
it considered Martinez and Aragon to be the most culpable members of the

conspiracy.

Rejecting Martinez’s restitution arguments, the district court held Martinez

and Aragon jointly and severally liable for the $541,370 in unaccounted

fraudulent proceeds resulting from the architectural design aspect of the

conspiracy. 2 Together with the $2,019,448.66 that Martinez received from the

audio-visual installation, and the $150,000 that Martinez admitted to receiving

from the architectural design scheme, the district court ordered that Martinez pay

$2,710,818.66 in restitution to the State of New Mexico.

II

We review a criminal defendant’s sentence for reasonableness, deferring to

the district court under the “familiar abuse-of-discretion standard of review.”

Gall v. United States, 552 U.S. 38, 46 (2007). Reasonableness review has a

procedural and substantive component. United States v. Alapizco-Valenzuela,

546 F.3d 1208, 1214 (10th Cir. 2008). Martinez argues that each component of

his sentence is unreasonable, and we address each in turn.

A

In reviewing a criminal defendant’s sentence for procedural reasonableness,

2
Another district judge also imposed joint and several liability on Schiff
and Schultz for the $541,370 in unaccounted fraudulent proceeds. See United
States v. Schiff, No. 1:07-cr-00252 (D.N.M. July 8, 2009) (Judgment); United
States v. Schultz, No. 1:07-cr-00518 (D.N.M. Apr. 30, 2009) (Judgment).

10
we determine whether the district court committed any error in “calculating or

explaining the sentence.” Id. Martinez argues that the district court committed

two procedural errors: first, the district court erred in using the 2008 version of

the Guidelines to calculate Martinez’s advisory guideline range; second, the

district court erred in denying Martinez the opportunity to present certain

evidence during his sentencing hearing. As to his first challenge, “[w]e review

the district court’s legal conclusions regarding the Guidelines de novo . . . .”

United States v. Hamilton, 587 F.3d 1199, 1219 (10th Cir. 2009). As to his

second challenge, “[w]e review the exclusion of sentencing evidence for abuse of

discretion.” United States v. Mitchell, 366 F.3d 376, 379 (5th Cir. 2004) (per

curiam).

Martinez argues that the district court’s application of the 2008 version of

the Guidelines “dramatically increased the base offense level for [his] offense in

violation of the ex post facto clause inherent in the Due Process Clause of the

Fifth Amendment.” Aplt. Br. at 31 (emphasis removed). Martinez also contends

that applying the 2008 version was “simply not reasonable in light of the facts of

the case,” id. at 31, because his total offense level would have been lower under

the version of the Guidelines in effect “[a]t the time the conspiracy began,” id. at

30.

A district court “shall use the Guidelines Manual in effect on the date that

the defendant is sentenced,” unless using that version of the Guidelines Manual

11
would violate the ex post facto clause of the United States Constitution. U.S.S.G.

§ 1B1.11(a), (b)(1). A district court violates the ex post facto clause when it

“applies a guideline to an event occurring before its enactment, and the

application of that guideline disadvantages the defendant by altering the

definition of criminal conduct or increasing the punishment for the crime.”

United States v. Foote, 413 F.3d 1240, 1249 (10th Cir. 2005) (citations and

quotations omitted). In such a case, the district court instead must use “the

Guidelines Manual in effect on the date that the offense of conviction was

committed.” U.S.S.G. § 1B1.11(b)(1). “[T]he last date of the offense of

conviction is the controlling date for ex post facto purposes.” U.S.S.G. §

1B1.11(b)(1), app. n.2 (underlining removed).

Applying these principles, we conclude that the district court did not err in

applying the 2008 version of the Guidelines. Martinez confessed to his

involvement in the courthouse conspiracy in December 2005, and pleaded guilty

to his involvement in a conspiracy that continued from 1999 until January 2006.

Given that the 2005 version of the Guidelines became effective on November 1,

2005, we agree with the district court that “if there was an ex post facto issue, the

guidelines that would be used would either be the 2005 version or the 2004

version . . . .” 3 R. Vol. 4 at 174. In those versions, we have reviewed the

3
We focus on this time frame, in spite of Martinez’s guilty plea to two
(continued...)

12
pertinent guideline provisions that would be used to calculate Martinez’s advisory

guideline range, and conclude the 2008 version would not produce a different

result. 4

Martinez’s second argument is that the district court abused its discretion in

excluding “evidence of the co-Defendant’s relevant conduct in an effort to show

that he was not an organizer, leader or manager and that he did not receive the

greatest financial benefit . . . .” Aplt. Br. at 23. During cross-examination of

Agent McCandless at the sentencing hearing, Martinez asked if the agent was

aware that “since the early 1990s, many of the codefendants have been involved

in a common scheme to pay Senator Aragon in exchange for receiving influence

in bidding on public construction projects . . . .” R. Vol. 4 at 23. The

Government objected to this line of inquiry as irrelevant, and the district court

3
(...continued)
counts of mail fraud which allegedly occurred in June 2002 and June 2003. The
Guidelines provide that “[i]f the defendant is convicted of two offenses, the first
committed before, and the second after, a revised edition of the Guidelines
Manual became effective, the revised edition of the Guidelines Manual is to be
applied to both offenses.” U.S.S.G. § 1B1.11(b)(3); see United States v. Sullivan,
255 F.3d 1256, 1261-63 (10th Cir. 2001) (concluding that U.S.S.G. §
1B1.11(b)(3) does not violate the ex post facto clause of the United States
Constitution).
4
We also reject Martinez’s remaining argument on this issue—that the
district court erred in applying § 1B1.11 because it resulted in “dramatically
increased punishment” that “was simply not reasonable.” Aplt. Br. at 31. A
correctly calculated guideline range is “the ‘starting point and the initial
benchmark’ for any sentencing decision,” United States v. Todd, 515 F.3d 1128,
1134 (10th Cir. 2007) (quoting Gall, 552 U.S. at 49), and as we have already
discussed, the district court did not err in applying § 1B1.11.

13
sustained the Government’s objection, explaining its reasoning as follows:

I don’t consider it relevant for purposes of Mr. Martinez’s sentencing
to get into allegations of relevant conduct, and none of it is charged in
the Indictment as to other defendants, and none of it is addressed or
raised in any of the presentence reports. It’s obvious that this case, in
terms of what was presented to the grand jury and the subsequent
superseding indictments, has always focused on the Metropolitan
Courthouse. The issue of relevant conduct did come up under Evidence
Rule 404(b) in terms of other alleged acts, but none of that evidence
was ever presented, because we didn’t have a trial.

Id. at 32. Later during cross-examination, Martinez asked Agent McCandless

about “the total values of the contracts Mr. Parra’s company, P2RS, received for

the construction of the Metropolitan Courthouse.” Id. at 62. Although P2RS was

not involved in the two aspects of the conspiracy, Martinez’s theory was that

because Parra said “every job his company got, he got because of Senator

Aragon,” any profit that P2RS earned from its Metropolitan courthouse contracts

should be factored into the gain Parra received from the conspiracy. Id. at 63.

Again the Government objected, arguing this line of inquiry was irrelevant. The

district court permitted a limited exploration of this line of inquiry before

eventually concluding that it was irrelevant for purposes of sentencing Martinez.

Id. at 66-68.

Although the Government objected to Martinez’s subsequent attempts to

pursue these lines of inquiry, see, e.g., id. at 77, 90, 93, 97, Martinez proffered

the ultimate facts that he was trying to prove just before allocution:

[W]ith respect to other activity by similarly situated defendants,

14
 we would submit that, if we were able to present evidence, we would
show that Michael Murphy received [$1,229,993.93] for his
construction contract on the Metropolitan Court.
We would show that Raul Parra made $1,214,000 for his work in
the Metropolitan Detention Center, the courthouse mechanical
engineering, and parking lot portions of the contract.
We would show that Marc Schiff made $9,384,801.45 in
contracts for his company, DCSW, in the Metropolitan Detention Center
and the courthouse and the Metropolitan Courthouse parking structure.
And we would show that Ken Schultz was paid, in the period
from 2000 to 2004, [$336,374.53] for his lobbying contract with
DCSW. 5

Id. at 203. In response to this proffer, the district court reemphasized its prior

ruling, explaining that “as far as any allegations of other corruption on any other

public projects, no defendant in this case received any type of enhancement under

the guidelines for relevant conduct,” and that the court’s “focus has been on each

defendant’s culpability regarding the design and construction of the Metropolitan

Courthouse, and what other defendants may or may have not done regarding other

projects is simply not relevant for the purposes of this sentencing or the

sentencing of any other defendant in this case.” Id. at 204-05.

On appeal, Martinez argues the district court abused its discretion in

excluding “evidence to show that the conspiracy involving his co-Defendants

began in the early 1990s and formed part of a common scheme or plan in which

Mr. Martinez played only a minor role,” and in excluding “evidence to refute the

5
Within each of these amounts, Martinez did not differentiate between the
portion representing fraudulent proceeds, and the portion representing revenues
for services actually rendered.

15
allegation in his [PSR] that he had received the highest gross proceeds of any co-

conspirators by pointing to the personal and corporate benefits received by his co-

Defendants during their ongoing criminal conspiracies in public construction

projects.” Aplt. Reply at 7. He primarily relies on 18 U.S.C. § 3661, which

provides that “[n]o limitation shall be placed on the information concerning the

background, character, and conduct of a person convicted of an offense which a

court of the United States may receive and consider for the purpose of imposing

an appropriate sentence.” 6

We do not view 18 U.S.C. § 3661 as dispositive. The statutory language of

§ 3661 appears to focus on the individual circumstances of the person being

sentenced; here, Martinez sought to introduce “information concerning the

background, character, and conduct” of co-conspirators for comparison purposes.

But on a more fundamental level, § 3661 “codifies the longstanding principle that

sentencing courts have broad discretion to consider various kinds of information.”

United States v. Watts, 519 U.S. 148, 151 (1997) (per curiam); see also United

6
Martinez also points to U.S.S.G. § 6A1.3(a), which permits a district court
to consider “relevant evidence without regard to its admissibility” in “resolving
any dispute concerning a factor important to the sentencing determination.” This
Guideline provision is unhelpful because the district court excluded the evidence
on relevancy grounds.
Martinez also argues the exclusion of this evidence caused the district court
to “arrive[] at [an] advisory Guideline level which was based on clearly erroneous
factual findings.” Aplt. Reply at 6. But Martinez does not identify exactly how
the exclusion of this evidence resulted in an improperly calculated offense level.

16
States v. Hooks, 551 F.3d 1205, 1217 (10th Cir. 2009) (“With few limitations, a

court has almost unlimited discretion in determining what information it will hear

and rely upon in imposing a sentence under the advisory sentencing guidelines.”

(citation, quotation and alteration omitted)). Simply put, in sentencing one co-

defendant convicted for his participation in a highly-publicized and immense

conspiracy to defraud the State of New Mexico of millions of dollars, the district

court refused to delve into prior co-conspirator conduct because that conduct was

never alleged in an indictment and was never used to calculate the advisory

guideline ranges of other co-defendants. The district court did not abuse its

discretion by limiting the evidence it considered. By its ruling, the district court

refused to embark upon an “apples and oranges” comparison between the

fraudulent proceeds Martinez gained from this conspiracy and the contract

revenues for services rendered that other co-conspirators previously gained from

allegedly bribing Aragon. We find no procedural error. 7

7
We additionally reject Martinez’s characterization of the evidence he
sought to present at sentencing as relevant conduct. Under the Guidelines,
relevant conduct is the range of conduct attributable to a defendant for purposes
of calculating his or her guideline range. See U.S.S.G. § 1B1.3. Even assuming
Martinez was indeed a latecomer to an ongoing conspiracy, the prior co-
conspirator conduct he sought to introduce would not affect the calculation of his
offense level. The Guidelines clearly state that “[a] defendant’s relevant conduct
does not include the conduct of members of a conspiracy prior to the defendant
joining the conspiracy, even if the defendant knows of that conduct.” U.S.S.G. §
1B1.3 app. n.2.

17
 B

We employ an abuse of discretion standard in reviewing a criminal

defendant’s sentence for substantive reasonableness. United States v. Smart, 518

F.3d 800, 806 (10th Cir. 2008). We “afford substantial deference to [the] district

court[],” id., and determine “whether the length of the sentence is reasonable

given all the circumstances of the case in light of the factors set forth in 18

U.S.C. § 3553(a),” United States v. Friedman, 554 F.3d 1301, 1307 (10th Cir.

2009) (quotation and citation omitted). Because substantive reasonableness

“contemplates a range, not a point,” United States v. Omole, 523 F.3d 691, 698

(7th Cir. 2008) (citations and quotations omitted), in this arena we recognize a

range of “rationally available choices” that “the facts and law at issue can fairly

support,” United States v. McComb, 519 F.3d 1049, 1053 (10th Cir. 2007). Even

if we might reasonably conclude that a different sentence was also appropriate,

that is not a sufficient basis for reversal. Gall, 552 U.S. at 51. We reverse only

when the district court “renders a judgment that is arbitrary, capricious,

whimsical or manifestly unreasonable.” Friedman, 554 F.3d at 1307 (citation and

quotation omitted).

Martinez’s PSR calculated his advisory guideline range at 108-135 months,

which resulted from a total offense level of 31 and a criminal history category I.

At sentencing, the district court imposed a three-level adjustment for Martinez’s

role as a “manager or supervisor” under U.S.S.G. § 3B1.1(b), increasing

18
Martinez’s total offense level to 34, and yielding an increased advisory guideline

range of 151-181 months. The district court then granted the Government’s

motion for substantial assistance and downwardly departed eight levels,

decreasing Martinez’s total offense level to 26 and reducing his advisory

guideline range to 63-78 months. In sentencing Martinez to 60 months’

imprisonment on the conspiracy count and to 67 months’ imprisonment on the

mail fraud counts, with all terms of imprisonment to run concurrently, the district

court explained

[T]hat is the same term of incarceration that was imposed on Mr.
Aragon, and as I noted earlier, I consider the two leaders or the two
individuals who were the most culpable in this conspiracy to be Mr.
Aragon and Mr. Martinez, and that’s due in large part to the roles they
played, one being an elected public official and, in Mr. Martinez’s case,
the other being a public official in a high-ranking capacity as the
administrator of the Metropolitan Court.

R. Vol. 4 at 222. Martinez argued that his sentence was unfairly severe because it

improperly equated Martinez’s conduct with Aragon’s. Martinez argued that the

district court’s acceptance of Aragon’s Rule 11(c)(1)(C) sentence of 67 months’

imprisonment was an implicit determination that 67 months’ imprisonment was a

“just and reasonable sentence” for Aragon, and it was therefore unfair to impose

an identical sentence on Martinez given that Aragon did not cooperate with the

Government, was “the last defendant to plead,” and “actively obstructed justice.”

Id. at 233-34. The district court considered this argument and rejected it. The

district court stated that it “did take into account the sentencing factors of 18

19
U.S.C. 3553(a)(1) through (7),” explained that it did “not consider there to be

unwarranted sentencing disparities in this case particularly with respect to Factor

No. 6 of the sentencing factors,” and further emphasized that

The fact that the government, in the negotiation with Mr. Aragon,
agreed on a specific sentence of 67 months, again, some of that, there
are factors that go into those type of negotiations in terms of age and
health of the defendant. There were some issues relating to Mr.
Aragon’s health and his age in terms of that he’s older than Defendant
Martinez. Those type of factors can be considered.
....
. . . I guess they’re intangible factors, but oftentimes, plea
negotiations are on a case-by-case and oftentimes defendant-by-
defendant basis, and not all defendants are in the same status in terms
of considerations that the government goes into when plea negotiations
are done.

Id. at 234-36.

Martinez argues his sentence is substantively unreasonable because of co-

conspirator disparity. Martinez contends that there are unwarranted sentencing

disparities between the sentence he received and the sentences that Aragon, Parra,

and Schiff each received. He primarily invites us to compare his sentence to

Aragon’s sentence: using Aragon’s Rule 11(c)(1)(C) sentence of 67 months’

imprisonment as a benchmark, Martinez contends that “[i]f one defendant

provided substantial assistance and the other defendant actively obstructed justice

and yet the two received the same sentence, unwarranted sentencing disparities

are obvious.” Aplt. Br. at 35.

One factor that a district court must consider in imposing an appropriate

20
sentence is “the need to avoid unwarranted sentence disparities among defendants

with similar records who have been found guilty of similar conduct . . . .” 18

U.S.C. § 3553(a)(6). On its face, this factor requires a district court “to take into

account only disparities nationwide among defendants with similar records and

Guideline calculations.” United States v. Verdin-Garcia, 516 F.3d 884, 899 (10th

Cir. 2008) (emphasis in original); see also United States v. Ivory, 532 F.3d 1095,

1107 (10th Cir. 2008) (Ҥ 3553(a)(6) . . . looks to uniformity on a national

scale”). Recently in Gall, the Supreme Court implicitly approved of a district

court’s consideration of “unwarranted similarities among other co-conspirators

who were not similarly situated.” 552 U.S. at 55 (emphasis added). We have

interpreted Gall to conclude that although § 3553(a) does not require a

consideration of co-defendant disparity, United States v. Rojas, 531 F.3d 1203,

1210 (10th Cir. 2008), it is not improper for a district court to undertake such a

comparison, Smart, 518 F.3d at 804. Nonetheless, “disparate sentences are

allowed where the disparity is explicable by the facts on the record.” United

States v. Davis, 437 F.3d 989, 997 (10th Cir. 2006) (quotation and citations

omitted). And § 3553(a)(6)’s consideration of unwarranted sentence disparities is

but one factor that a district court must balance against the other § 3553(a) factors

in arriving at an appropriate sentence. United States v. Charles, 467 F.3d 828,

833 (3d Cir. 2006).

We reject Martinez’s argument of co-conspirator disparity because any

21
disparity between his and Aragon’s identical terms of imprisonment is explained

by their different plea agreements: whereas Aragon’s Rule 11(c)(1)(C) agreement

stipulated to 67 months’ imprisonment, Martinez’s agreement gave the district

court ultimate discretion to determine his sentence. We also reject Martinez’s

argument because it essentially urges this court to re-sentence him, giving greater

weight to the existence of co-conspirator disparities than did the district court.

That is not our role. The weight a district court assigns to each of the § 3553(a)

factors, and the balance it ultimately assesses among them, is not subject to our

de novo review. Smart, 518 F.3d at 808. “[A]s long as the balance struck by the

district court among the factors set out in § 3553(a) is not arbitrary, capricious, or

manifestly unreasonable, we must defer to that decision even if we would not

have struck the same balance in the first instance.” United States v. Sells, 541

F.3d 1227, 1239 (10th Cir. 2008). Here, the district court credited Martinez’s

substantial assistance with a downward departure of eight levels, but imposed a

within-Guidelines sentence that was identical to Aragon’s because those two

defendants played commensurate roles in the conspiracy. To the extent these

identical terms of imprisonment created a disparity, the district court did not

consider it to be unwarranted. We cannot say that the balance the district court

struck among the § 3553(a) factors was arbitrary, capricious, or manifestly

unreasonable. Martinez’s sentence of 67 months’ imprisonment “falls within the

realm of . . . rationally available choices,” McComb, 519 F.3d at 1053, and we

22
affirm the sentence imposed. 8

III

Martinez also argues that the district court erred in determining the amount

of restitution he is to pay to the State of New Mexico under the MVRA. He

maintains that the district court erred in not offsetting his restitution obligation by

the value of his property subject to criminal forfeiture, in not offsetting his

restitution obligation by the amount of federal and state income taxes paid on his

share of fraudulent proceeds, and in finding Martinez jointly and severally liable

for the $541,370 of unaccounted fraudulent proceeds resulting from the

architectural design aspect of the conspiracy. “We review the district court’s

8
We also reject the argument that Martinez, Schiff, and Parra are similarly
situated. The comparison with Schiff is unavailing because Schiff was sentenced
after Martinez and by a different district court judge. The comparison with Parra
is without merit because Martinez and Parra played different roles in the
conspiracy and received different amounts of fraudulent proceeds. We also reject
the argument that Martinez and Parra are similarly situated because Parra
“deducted more than $1.8 million in fraudulent payments [to Smart Solutions]
from his income taxes.” Aplt. Br. at 36. Martinez has never demonstrated the
extent to which Parra’s tax deductions should be considered as fraudulent gain.
The testimony that Martinez elicited from Agent McCandless at the sentencing
hearing only demonstrated that the agent did not incorporate the value of any tax
savings into his calculation of each co-conspirator’s fraudulent gain, was not
aware of the precise amount of the tax savings resulting from Parra’s deductions,
and did not necessarily believe Parra’s deductions were illegal. See R. Vol. 4 at
70-71 (“I’m not an IRS agent, but the way I interpret the way [Parra] did that,
even though the activity was illegal, claiming those expenses is not if they’re
related to the income.”). Moreover, the broader point is that the district court
heard this testimony and concluded that there was no unwarranted sentencing
disparity here, a conclusion we have already determined was not an abuse of
discretion.

23
application of the MVRA de novo, review its factual findings for clear error, and

review the amount of restitution awarded for abuse of discretion.” United States

v. Gallant, 537 F.3d 1202, 1247 (10th Cir. 2008).

A

Martinez argues that the district court erred by not offsetting his restitution

obligation to the State of New Mexico by the value of the property he agreed to

forfeit to the federal government. Whether the MVRA permits such an offset is a

question of law that we review de novo. United States v. Ruff, 420 F.3d 772, 773

(8th Cir. 2005).

Prior to the enactment of the MVRA, the imposition of restitution was a

discretionary decision under the Victim and Witness Protection Act of 1982

(“VWPA”), Pub. L. No. 97-291, § 5, 96 Stat. 1248, 1253-55 (1982) (codified as

amended at 18 U.S.C. §§ 3663, 3664). See 18 U.S.C. § 3663(a) (1994); United

States v. Alalade, 204 F.3d 536, 539 (4th Cir. 2000). In deciding whether to

impose restitution, and in determining the amount of such restitution, the VWPA

directed the district court to consider the “amount of loss sustained by a victim as

a result of the offense, the financial resources of the defendant, the financial

needs and earning ability of the defendant and the defendant’s dependents, and

such other factors as the court deem[ed] appropriate.” 18 U.S.C. § 3664(a)

(1994).

The MVRA alters this framework in two important ways. First, as its title

24
indicates, the MVRA requires the mandatory imposition of restitution for certain

categories of crimes. See 18 U.S.C. § 3663A(c)(1)(A)(ii) (including “offense[s]

against property” under Title 18, “including any offense committed by fraud or

deceit”). For these specified categories of crimes, the MVRA requires that a

district court “shall order, in addition to . . . any other penalty authorized by law,

that the defendant make restitution to the victim of the offense . . . .” 18 U.S.C. §

3663A(a)(1). A “victim” under the MVRA is “a person directly and proximately

harmed as a result of the commission of an offense for which restitution may be

ordered . . . .” Id. § 3663A(a)(2); see United States v. Quarrell, 310 F.3d 664,

677 (10th Cir. 2002) (“[T]he government can be a ‘victim’ under the MVRA.”).

Second, the MVRA “significantly limit[s]” a sentencing court’s discretion

in determining the amount of restitution. United States v. Bright, 353 F.3d 1114,

1121 (9th Cir. 2004). In contrast to the discretionary provisions of the VWPA,

the MVRA requires that “[i]n each order of restitution, the court shall order

restitution to each victim in the full amount of each victim’s losses as determined

by the court and without consideration of the economic circumstances of the

defendant.” 18 U.S.C. § 3664(f)(1)(A) (emphasis added). 9 In addition, “[i]n no

case shall the fact that a victim has received or is entitled to receive compensation

with respect to a loss from insurance or any other source be considered in

9
Any order of restitution under the MVRA must be imposed in accordance
with the procedures of 18 U.S.C. § 3664. 18 U.S.C. § 3663A(d).

25
determining the amount of restitution.” Id. § 3664(f)(1)(B). Under the MVRA, a

district court considers the defendant’s financial circumstances only in specifying

the manner and schedule of payments. See id. § 3664(f)(2).

The MVRA contains two provisions “particularly relevant to the issue of

offsets.” Bright, 353 F.3d at 1122. One provision states that “[i]f a victim has

received compensation from insurance or any other source with respect to a loss,”

the district court shall order that restitution be paid to that source after the victim

has received full payment. 18 U.S.C. § 3664(j)(1). The other provision states

that “[a]ny amount paid to a victim under an order of restitution shall be reduced

by any amount later recovered as compensatory damages for the same loss by the

victim in–(A) any Federal civil proceeding; and (B) any State civil proceeding, to

the extent provided by the law of the State.” Id. § 3664(j)(2).

Based on this statutory framework, the Fourth, Eighth, and Ninth Circuits

have determined that the MVRA prohibits a district court from considering the

value of a defendant’s forfeited property in ordering restitution pursuant to §

3664(f)(1)(A)-(B). Bright, 353 F.3d at 1122-23; Alalade, 204 F.3d at 540; see

United States v. McCracken, 487 F.3d 1125, 1128-29 (8th Cir. 2007) (“[T]he

district court has no discretion to adjust the total restitution due to the victim

based on funds held by law enforcement.”); Ruff, 420 F.3d at 774 (concluding

that § 3664(f)(1)(B) required the district court to order restitution in the full

amount that was stipulated in the plea agreement); see also United States v.

26
Taylor, 582 F.3d 558, 565-68 (5th Cir. 2009) (per curiam) (canvassing these

decisions and concluding that no offset was appropriate because there was no

evidence the victims had received any forfeited funds).

In Alalade, the Fourth Circuit concluded that the “plain language of the

MVRA did not grant the district court discretion to reduce the amount of

restitution required to be ordered by an amount equal to the value of the property”

subject to administrative forfeiture. 204 F.3d at 540. Comparing the VWPA’s

language with the MVRA’s, the court concluded that “Congress completely

deleted the language of the VWPA affording the district court discretion . . . to

consider any factor it deemed appropriate in determining the amount of restitution

. . . .” Id. Also critical to the court’s analysis was § 3664(f)(1)(B): if a district

court could not reduce a defendant’s restitution obligation by the amount of third-

party compensation the victim had received prior to the entry of the restitution

order, “it would be nonsensical for the district court to have discretion to reduce

the amount of restitution by the value of property seized from the defendant and

retained by the government in administrative forfeiture . . . .” Id.; see United

States v. Rollins, 65 F. App’x 215, 216 (10th Cir. 2003) (citing Alalade in

concluding that the MVRA did not permit the district court to offset a defendant’s

restitution obligation to bank robbery victims by the amount of funds retained by

the State of Texas).

Following Alalade, the Ninth Circuit concluded in Bright that it was “clear”

27
from the MVRA’s plain language that “the district court was required in the first

instance to set the amount of [the defendant’s] restitution obligation based on his

victims’ collective losses and without regard to forfeited funds – whether or not

any of those funds had been turned over to the victims.” 353 F.3d at 1122.

Offsets against the full amount of restitution were “handled separately as

potential credits against the defendant’s restitution obligation – not as reductions

in the amount of that obligation in the first instance.” Id. at 1121.

Neither Alalade nor Bright addressed whether a defendant’s restitution

obligation should be offset by a victim’s receipt of forfeited property. Alalade,

204 F.3d at 541 n.5; Bright, 353 F.3d at 1122-23. In particular, Bright declined to

address the issue because the forfeiture funds in that case were not available for

the victims, and “the MVRA provisions . . . make clear that funds the victims

have not received cannot reduce or offset the amount of losses the defendant is

required to pay.” 353 F.3d at 1122-23 (emphasis in original). However, the

Eighth Circuit addressed this unanswered question in Ruff, a case in which a

defendant stipulated in his plea agreement to provide restitution to a state agency

for money spent investigating his criminal activities. 10 420 F.3d at 773. The

defendant contended that the agency had received or was going to receive

10
The MVRA provides that “[t]he court shall also order, if agreed to by the
parties in a plea agreement, restitution to persons other than the victim of the
offense.” 18 U.S.C. § 3663A(a)(3).

28
proceeds from the administrative forfeiture of his property. The Eighth Circuit

doubted whether proceeds recovered from administrative forfeiture would qualify

as “compensatory damages” that could be credited against the defendant’s

restitution obligation pursuant to § 3664(j)(2), but nonetheless concluded that the

“bar against double recovery should . . . preclude the [agency] from recovering an

amount greater than the agency expended . . . .” Id. at 775. The Eighth Circuit

directed the district court on remand to “modify the restitution order to prevent

double recovery” by the agency if Ruff could establish that the agency received

any forfeiture funds. Id. at 776; see also McCracken, 487 F.3d at 1129 (noting

the Government’s representation that forfeited funds from a bank robbery would

be delivered to the victim, “at which time the court presumably will adjust” the

restitution obligation); United States v. Smith, 297 F. Supp. 2d 69, 72-73 (D.D.C.

2003) (offsetting a defendant’s restitution obligation by the amount of forfeited

funds the federal government remitted to the victim).

Convinced by the reasoning of our sister circuits, we conclude that the

plain language of the MVRA, in particular § 3664(f)(1)(A)-(B), prohibits a

district court from considering the value of defendant’s forfeited property in

initially determining the full amount of restitution. Whether a defendant’s

restitution obligation may be offset by the value of forfeited property a victim has

received is an issue we need not decide. Unlike the defendant in Ruff, Martinez

does not contend that the State of New Mexico has received or will receive the

29
proceeds of his forfeited property; he only argues the federal government “is

easily in a position” to distribute them. Aplt. Br. at 45-46. “[T]he MVRA

provisions . . . make clear that funds the victims have not received cannot reduce

or offset the amount of losses the defendant is required to repay.” Bright, 353

F.3d at 1123 (emphasis in original). Accordingly, we reject Martinez’s argument

that his restitution obligation to the State of New Mexico should be offset by the

value of property he agreed to forfeit to the federal government.

B

Martinez next argues that the district court erred by not offsetting his

restitution obligation by the federal and state income taxes that his shell

corporation, Smart Solutions, paid on his share of fraudulent proceeds. Whether

the MVRA allows for such an offset is a question of law that we review de novo.

See United States v. Serawop, 505 F.3d 1112, 1117 (10th Cir. 2007) (“We

consider de novo the district court’s application of the MVRA . . . .”).

At oral argument, Martinez acknowledged that these arguments, though

theoretically conceivable, were difficult to make. Given the limited briefing

Martinez has devoted to these arguments, we will not labor over them. We reject

the argument that Martinez should receive an offset for his payment of federal

income taxes: the victim in this case is the State of New Mexico, not the federal

government, and as the district court recognized, Martinez’s assertion that “New

Mexico receives two dollars in federal tax dollars for every dollar its citizens

30
send to Washington” is without merit. Aplt. Br. at 44-45. We also reject the

argument that Martinez should receive an offset for his payment of state income

tax because the case he relies upon, United States v. Stewart, 321 F. Supp. 2d 652

(D. Md. 2004), does not support his argument. In Stewart, a defendant was

convicted for conspiring to convert survivor benefits from the Office of Personnel

Management. The district court ordered restitution to the United States, but offset

the defendant’s restitution obligation by the amount of income taxes the federal

government withheld from the benefit payments because “the Government always

had use of the withheld federal taxes and to that extent it was never injured.” Id.

at 656. The court did not offset the defendant’s restitution obligation by the

amount of federal income taxes the defendant “claim[ed] to have himself paid to

the Federal Government,” reasoning that “[a] thief is entitled to no credit for how

he chooses to spend purloined money, whether he gives it all to charity or uses it

to pay taxes.” Id. at 657. We reject the argument that Martinez should have

received an offset for his payment of income taxes.

C

Finally, Martinez challenges the district court’s imposition of joint and

several liability for the $541,370 in unaccounted fraudulent proceeds resulting

from the architectural design aspect of the conspiracy. In this case, the district

court imposed joint and several liability upon Aragon and Martinez for these

unaccounted fraudulent proceeds. In separate proceedings, joint and several

31
liability for these proceeds was also imposed on Schiff and Schultz.

The MVRA affords district courts the discretion to apportion restitution

among co-defendants that contribute to a victim’s loss:

If the court finds that more than 1 defendant has contributed to the loss
of a victim, the court may make each defendant liable for payment of
the full amount of restitution or may apportion liability among the
defendants to reflect the level of contribution to the victim’s loss and
economic circumstances of each defendant.

18 U.S.C. § 3664(h); see United States v. Booth, 309 F.3d 566, 576 (9th Cir.

2002) (“The court had the discretion to apportion the [restitution] total, but was

not required to do so.”). We review the district court’s imposition of joint and

several liability for an abuse of discretion. United States v. Sensmeier, 361 F.3d

982, 990 (7th Cir. 2004).

During Martinez’s sentencing hearing, Agent McCandless testified that the

$541,370 of unaccounted fraudulent proceeds was deposited into Schiff’s bank

account, from which Schiff subsequently made large cash withdrawals. R. Vol. 4

at 107. Agent McCandless also testified that apart from how much some of the

co-conspirators admitted to receiving, “or how much you can arrive at that they

actually received based upon their testimony and agreement,” there was

essentially no credible way of determining how these fraudulent proceeds were

ultimately distributed. Id. at 76-79. Largely relying on this testimony, Martinez

asserts that the district court erred in imposing joint and several liability “based

on nothing more credible than a guess.” Aplt. Br. at 42.

32
 Contrary to Martinez’s contention, the district court’s joint and several

liability ruling is supported. Martinez admitted in his plea agreement that the

“cash payments” from this aspect of the conspiracy “were, by and large, the

proceeds of false invoices submitted by Schiff and approved for payment by me,”

which were then “forwarded by my office along with payment vouchers to the

New Mexico Department of Finance and Administration.” R. Vol. 1 at 205.

According to Agent McCandless, Martinez may have been unaware of the full

magnitude of the architectural design aspect of the conspiracy, but he certainly

understood how it operated.

I think Mr. Martinez disagrees with knowing about the full scope
of $918,000. And in fairness to Mr. Martinez, . . . I agree that there’s
a good likelihood that he didn’t know that there were $918,000 worth
of fraudulent invoices sent, and probably the same thing for Mr.
Schultz. I do think that they knew that this was going on, and I think
it’s clear, if you look at the schedule and the cash withdrawals done by
Mr. Schiff, that they received a benefit on several of the transactions
involving the fraudulent invoices.
It’s clear that Mr. Schultz has said that – or has told us that the
reimbursables, as he described these amounts, was an idea that came
from Mr. Martinez, not from Mr. Schiff. So I think Mr. Martinez had
that idea to do this, maybe not to the magnitude of $918,000, but I think
it was he was definitely part of it.

R. Vol. 4 at 105-06. Finally, Agent McCandless testified that “all this money

[relating to the architectural design aspect] was actually approved during

[Martinez’s] term as court administrator, so he would have pretty good knowledge

of these invoices coming in . . . .” Id. at 109; see also R. Vol. 1 at 493. In sum,

the evidence shows that Martinez’s contribution was crucial to the success of the

33
entire architectural scheme, and therefore the district court did not abuse its

discretion in finding Martinez jointly and severally liable for the $541,370 of

unaccounted fraudulent proceeds.

Martinez cites several of our decisions discussing the loss calculation

rubric under the MVRA. Those decisions are not relevant to the issues presented

in this appeal because Martinez does not dispute the district court’s determination

of the total loss amount. His argument concerns the district court’s

apportionment of that amount, and on this point the Fourth Circuit’s decision in

United States v. Newsome, 322 F.3d 328 (4th Cir. 2003), is illustrative. In that

case, a defendant was a latecomer to a conspiracy to steal timber. For his relevant

conduct under the sentencing guidelines, the district court calculated the loss

attributable to the conspiracy during the few months the defendant was a member;

for MVRA restitution, the district court found the defendant, along with his co-

conspirators, jointly and severally liable for the entire loss that the conspiracy

caused. The Fourth Circuit affirmed because the MVRA’s statutory language

focuses on the “‘offense of conviction’ when describing the losses subject to a

restitution order.” Id. at 341. Thus, under the Fourth Circuit’s interpretation of

the MVRA, “each member of a conspiracy that in turn causes property loss to a

victim is responsible for the loss caused by the offense.” Id. (emphasis in

original). Here, given Martinez’s extensive involvement in the architectural

design aspect of the conspiracy, we need not definitively adopt the Fourth

34
Circuit’s interpretation of the MVRA to resolve the issues presented in this

appeal. Rather, we simply recognize Newsome as additional support for the

district court’s imposition of joint and several liability on Martinez for the

$541,370 in unaccounted fraudulent proceeds.

IV

The judgment of the district court is AFFIRMED.

35