United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued December 9, 2005 Decided January 13, 2006
Reissued January 18, 2006
No. 04-3064
UNITED STATES OF AMERICA,
APPELLEE
v.
CALVIN MCCANTS,
APPELLANT
Appeal from the United States District Court
for the District of Columbia
(No. 02cr00130-01)
Ketanji Brown Jackson, Assistant Federal Public Defender,
argued the cause for appellant. With her on the brief was A.J.
Kramer, Federal Public Defender. Neil H. Jaffee, Assistant
Federal Public Defender, entered an appearance.
Lisa H. Schertler, Assistant U.S. Attorney, argued the cause
for appellee. With her on the brief were Kenneth L. Wainstein,
U.S. Attorney, John R. Fisher, Assistant U.S. Attorney at the
time the brief was filed, Elizabeth Trosman and Virginia
Cheatham, Assistant U.S. Attorneys. Roy W. McLeese, III,
Assistant U.S. Attorney, entered an appearance.
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Before: RANDOLPH and GRIFFITH, Circuit Judges, and
EDWARDS, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge
EDWARDS.
EDWARDS, Senior Circuit Judge: Calvin McCants pled
guilty to possessing false document-making implements in
violation of 18 U.S.C. § 1028(a)(5) (2000). The Presentence
Investigative Report (“PIR”) prepared by the United States
Probation Office contained several highly contested factual
issues. At sentencing, however, the District Court made no
specific factual findings with respect to matters in dispute
between the defendant and the prosecutor. At the conclusion of
sentencing, the prosecutor inquired: “[A]s a housekeeping
matter . . . do I understand the Court to have adopted the
presentence report with respect to our sentencing
guidelines. . . ?” The trial judge replied, “That is correct.” On
appeal, the Government contends that the District Court’s last
minute “adoption” of the PIR amounted to the required
“findings” by the court mirroring those stated in the PIR. We
disagree.
Federal Rule of Criminal Procedure 32(i)(3)(B) states that
a sentencing court
must – for any disputed portion of the presentence report or
other controverted matter – rule on the dispute or determine
that a ruling is unnecessary either because the matter will
not affect sentencing, or because the court will not consider
the matter in sentencing.
Because the District Court failed to follow the strictures of Rule
32, we will remand the case for resentencing accompanied by
the required findings of fact.
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I. BACKGROUND
On March 15, 2002, the Government issued a 15-count
indictment against McCants, charging him with conspiracy to
defraud a number of financial institutions and unlawfully
transfer various means of identification. The indictment alleged
a number of specific offenses, several of which involved
presenting misappropriated credit histories and false
identifications to financial institutions to obtain fraudulent loans.
Unnamed co-conspirators actually obtained the loans, according
to the indictment, but McCants supplied them with stolen credit
histories and accompanying identification documents. McCants
was also charged with independent substantive offenses.
Relevant to this appeal is Count 13 of the indictment, which
accused McCants of violating 18 U.S.C. § 1028(a)(5) by
knowingly possessing tools used for the intentional production
of false identification documents.
Appellant reached an agreement with the Government to
plead guilty to Count 13. As part of that agreement, McCants
acquiesced to a factual statement of his offense, which was
appended to the plea. The factual statement described the fruits
of four Government searches targeting McCants. In essence, it
provided an inventory of the illicit supplies discovered in
McCants’ possession. These items are not in dispute.
The United States Probation Office released an initial PIR
on December 23, 2003. Both parties took issue with its findings.
The prosecution claimed that the report understated the amount
of loss attributable to McCants, failed to showcase evidence of
McCants’ use of “sophisticated means” to execute the offense,
and did not grasp the seriousness of the offense, which
warranted an additional upward departure. In particular, the
Government described the extensive holding of document-
making paraphernalia recovered in the four searches described
in McCants’ offense statement. The Government then alleged
that McCants sold two fake credit cards to Rickey Buchanan –
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a prosecution informant who bought phony documents from
McCants and led the ring of individuals who perpetrated the
bank fraud operations – in “controlled buys” orchestrated by
federal law enforcement agents. The Government also linked
McCants to 283 counterfeit or “obliterated” credit cards, which
the prosecution characterized as “access devices” for purposes
of United States Sentencing Guidelines § 2B1.1. Further, the
Government attributed to McCants $110,252 in losses stemming
from the bank fraud scheme, which the Government accused
McCants of facilitating; in connecting McCants to the larger
scheme, the memorandum asserted that he “shar[ed] in the loan
proceeds.” Government’s Memorandum in Aid of Sentencing
and Mot. for Upward Departure at 18, United States v. Calvin
McCants, Cr. No. 02-130 (D.D.C. filed Feb. 4, 2004). Finally,
the Government referred to identifications and credit cards in the
name of “Celvin McCants” found in appellant’s possession, and
asserted that “[h]e also obtained bank loans in that name – loans
which he did not repay.” Id. at 19. Those loans added another
$32,949.57 to the Government’s proposed loss calculation. On
top of the Guidelines score reflecting this proposed loss
attribution, the Government urged the District Court to increase
McCants’ offense level by two pursuant to United States
Sentencing Guidelines § 2B1.1(b)(8)(C), because McCants
utilized “sophisticated means” to perpetrate his crime. The
Government also urged a two-level upward departure, arguing
that the calculated loss amount “grossly understate[d] the
seriousness of McCants’ criminal conduct.” Id. at 22.
Attached to the Government’s sentencing memorandum
were transcripts of a series of telephone conversations between
McCants and Buchanan. McCants’ dealings with Buchanan
formed the basis of the Government’s theory linking McCants
to the bank frauds. The Government therefore relied heavily on
these conversations to establish the scope of McCants’
culpability. In particular, the Government has highlighted the
following information discerned from the transcripts: McCants
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claimed that an associate could acquire “dossiers,” which
provide “a whole log on anybody you want”; McCants priced a
package of materials, apparently including military
identification and driver’s licenses, in which “everything looked
legal,” at $3,000; McCants reported that his associate, “Doc,”
possessed fabricated licenses intended for Buchanan, and that,
with respect to one of Buchanan’s cohorts, “we put your boy’s
face on” the licenses. Finally, the Government attached a
second addendum with an itemized list of the credit cards
uncovered during searches of McCants’ addresses.
The defense also lodged objections to the initial PIR and
filed a responsive memorandum with the trial court. First, it
challenged the Government’s calculation of the amount of loss
attributable to McCants, and offered a counter-calculation. In
particular, McCants posited that the total loss for which he was
responsible “is $136,500, and in the worse [sic] case would be
no more than $187,692.05.” Defendant’s Mot. for
Consideration for Downward Departure and Opp. to the Gov’ts
Memorandum in Aid of Sentencing and Mot. for Upward
Departure at 2, United States v. Calvin McCants, Cr. No. 02-130
(D.D.C. filed Feb. 23, 2004). The difference in loss calculation
was critical to determining McCants’ sentence, because losses
over $200,000 increase the base level for McCants’ offense of
conviction by 12 points, whereas losses between $120,000 and
$200,000 increase the base level by only 10 points. See
U.S.S.G. § 2B1.1(b)(1)(F), (G) (2003).
To scale back the calculation, McCants first argued that he
possessed only 273 “access devices,” not the 283 cited by the
Government, in part because “obliterated” cards – i.e., cards on
which the identifying information has been filed off – could not
count. McCants also denied responsibility for the two cards
allegedly sold in the controlled buys, maintaining that he never
actually transmitted the cards to Buchanan or received any
money for them. Next, the defense strongly opposed penalizing
6
McCants for any of the bank fraud schemes perpetrated by
Buchanan and his crew. McCants attacked Buchanan’s
credibility and emphasized the financial independence of the
two men, insisting that McCants received a flat fee for his
product and no portion of Buchanan’s proceeds. McCants also
countered the Government’s support of an adjustment for his
alleged use of “sophisticated means,” arguing that the false
document-making implement statute already contemplates the
use of sophisticated equipment.
In May 2004, the Probation Office issued a final PIR. It
maintained the view that Buchanan’s bank fraud operation was
“relevant conduct,” see U.S.S.G. § 1B1.3, for purposes of
devising McCants’ sentence. The PIR found that appellant
“engaged in a scheme which defrauded banks and lending
institutions of over $100,000.” Presentence Investigative Report
¶ 10, United States v. Calvin McCants, Cr. No. 02-130 (D.D.C.
May 6, 2004) (“PIR”). It further found that McCants “would
typically receive a ‘one-third payment’ for his activities, either
at the time he produced a loan package . . . for an unnamed
coconspirator or after a fraudulent loan was obtained [with
proceeds from the loan].” Id. ¶ 13 (brackets in original). An
additional $32,949 was assigned to McCants because “the
government indicated that the defendant is responsible for two
defaulted loans [using the name Celvin McCants].” Id. ¶ 33
(brackets in original). In sum, the PIR calculated that
$289,701.15 in loss was attributable to McCants.
At a series of sentencing hearings, the Government
presented testimony from two witnesses: Secret Service Special
Agent Jeffrey Porter, who had investigated McCants, and
Buchanan. Porter described the trove of equipment, credit
histories, and counterfeit documents uncovered during the
successive raids on McCants’ properties. Buchanan testified
that appellant would provide him with the documents needed to
commit bank fraud, including credit histories and other financial
7
information, as well as identification documents manufactured
with pictures of the individuals Buchanan dispatched to the
lending institutions. He further recalled that McCants advised
him to avoid using a particular identity more than three or four
times so as to avoid attracting suspicion, and to ensure that his
cohorts dressed appropriately when they impersonated
legitimate loan-seekers. On cross-examination, Buchanan
reported the pricing scheme McCants imposed. Buchanan
claimed that prices reflected factors like what kind of document
was being transacted, its quality, and even McCants’ mood on
a given day; but Buchanan never alluded to dividing profits from
particular acts of bank fraud or any other fraudulent venture.
After the testimony and oral proffers by each side’s counsel,
the District Court announced its ruling. It began by noting that,
“under the revised presentence report, the total offense level
would be 20.” Tr. 5/11/04 at 7. The court then queried “are we
all in agreement on that,” and the prosecutor responded: “We all
agree that that’s what the presentence report says, but I think
both [defense counsel] and I have disagreements as to that being
applicable.” Id. The court replied that it was using that level as
“the basic figure.” Id.
The court then commenced its analysis. It noted that “one
of the issues – and the Court is going to file a memorandum . . .
is whether or not the defendant in this matter used a
sophisticated means in order to – in the commission of the
offense.” Id. at 8. The court observed that the statutory offense
covers possession of document-making implements. It then
concluded:
Because the sentencing guidelines seem to refer to the
sophisticated means used in covering up or hiding an
offense or relating to the commission of the offense
charged, and I guess an argument can be made as to when
you look at the offense charged, it seems to be possession,
whether that would cover it.
8
I have considered that, and the Court is satisfied and
will rule that these were sophisticated means and that the
offense level should be enhanced by two.
This brings then the total offense level to 22, criminal
category III.
Id. at 9. The court further indicated that a sentencing
memorandum would be forthcoming. The court also
emphasized the gravity of producing false military
identification, which had the potential to threaten national
security; in light of this concern, the court enhanced the offense
level by two more points. After each side’s counsel addressed
McCants’ background and character, the court sentenced
McCants to 78 months in prison, followed by three years of
supervised release, as well as $77,852.15 of restitution. Id. at
36. The District Court never made findings to resolve the
factual issues between the parties over disputed portions of the
PIR. Nor did the court ever issue the promised memorandum
explaining its decision.
After the District Court pronounced its sentence, the
prosecutor inquired: “[A]s a housekeeping matter . . . do I
understand the Court to have adopted the presentence report
with respect to our sentencing guidelines, with the additional
two provisions, that being the upward adjustment for
sophisticated means, and a two-level upward departure?” Id. at
41. The court replied, “That is correct.” Id.
II. ANALYSIS
As noted above, Federal Rule of Criminal Procedure
32(i)(3)(B) (2004) (“Rule 32") provides that a sentencing court
must – for any disputed portion of the presentence report or
other controverted matter – rule on the dispute or determine
that a ruling is unnecessary either because the matter will
9
not affect sentencing, or because the court will not consider
the matter in sentencing.
The Rule further states that the prescribed determinations must
be appended to any copy of the presentence report made
available to the Bureau of Prisons. FED. R. CRIM. P. 32(i)(3)(C).
We agree with appellant that the District Court’s failure to
adhere to the commands of Rule 32 requires a remand of this
case.
Appellant argues that the District Court transgressed Rule
32 by incorporating the PIR’s recommended sentence as its
“basic figure” without ever making specific factual findings. In
particular, McCants points out that the District Court made no
findings on (1) the existence and scope of McCants’ facilitation
of the Buchanan conspiracy, (2) McCants’ responsibility for the
fraudulent loans allegedly obtained by “Celvin McCants,” and
(3) the number of “access devices” McCants possessed.
McCants argues that, since the PIR contained factual assertions
that were hotly contested by the defendant and the prosecutor,
Rule 32 obligated the trial court to confront the factual disputes
and resolve them on the record. We agree. Key elements of the
PIR’s calculation rely on contentious assumptions. Those
assumptions may be valid, but Rule 32 requires the sentencing
court to spell out its findings on disputed factual matters. Its
failure to do so here impels us to remand for resentencing.
The District Court’s failure to resolve factual contests
violated Rule 32. While we have refrained from mandating a
“bright line rule that every failure of literal compliance with
Rule 32 requires remand for resentencing,” we have remanded
when “the record does not reveal the District Court’s finding on
a serious and potentially pivotal sentencing factor.” United
States v. Chaikin, 960 F.2d 171, 175 (D.C. Cir. 1992). The fact-
finding requirement “serves more than the purely ministerial
function” of transmitting accurate information to the Bureau of
Prisons and Parole Commission; more importantly, “it protect[s]
10
a defendant’s due process rights to be sentenced on the basis of
accurate information, and facilitates appellate review by
furnishing a clear record of the resolution of disputed facts.”
United States v. Graham, 83 F.3d 1466, 1477 (D.C. Cir. 1996)
(internal quotations and citations omitted) (alterations in
original). As we have noted, sentences under the Guidelines
“‘must be supported by reasons,’” and that means “‘something
more than conclusions – a distinction important not only to the
defendant whose future is at stake but also to the appellate
process.’” United States v. Childress, 58 F.3d 693, 723 (D.C.
Cir. 1995) (quoting United States v. Edwards, 945 F.2d 1387,
1399 (7th Cir. 1991)).
This case underscores the need for adherence to Rule 32.
The issues presented by McCants’ sentencing raise inescapable
controversies. The appellate court is not in a position to resolve
those controversies in the first instance. Nor are we equipped to
discern the District Court’s view of the facts. McCants has
pointed to several alleged defects with his sentence. All of them
turn on issues of fact. For us to determine whether the
sentencing court properly calculated McCants’ sentence, we
need to know what factual propositions it credited. Were there
no dispute as to any of the operative facts, we might be able to
infer the trial court’s view. But, as we discuss below, the record
assembled before the District Court does not self-evidently
resolve these quandaries. And the District Court’s assurance, in
response to the prosecutor’s “housekeeping” query, that it
intended to adopt the PIR does not resolve the underlying factual
controversies. McCants has called into question the evidentiary
basis for several of the PIR’s recommendations. Thus, this is
not a case in which the findings in the PIR are “‘so clear that the
reviewing court is not left to “second-guess” the basis for the
sentencing decision.’” Graham, 83 F.3d at 1477 (quoting
United States v. Carreon, 11 F.3d 1225, 1231 (5th Cir. 1994)).
The record before us in this case is inadequate for appellate
review.
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McCants has pointed to four sentencing issues with respect
to which the underlying factual predicate is unclear. We
emphasize that our brief discussion of these disputes is meant
only to highlight the factual issues whose resolution must
precede a determination of McCants’ sentence. In other words,
we address these matters only to explain why they remain
obscure. We do not attempt to resolve the factual issues, or even
to offer interpretive guidance to the District Court. “We only
direct the Court to enter the findings required by Rule 32 or state
its non-reliance on the contested matter[s].” Chaikin, 960 F.2d
at 175.
Chief among the controversies left unaddressed by the
District Court was the scope of McCants’ “relevant conduct,”
and, in particular, whether it extends to the bank fraud operation
run by Buchanan. Under the Sentencing Guidelines, an
offender’s relevant conduct will encompass “all acts and
omissions committed, aided, abetted, counseled . . . . or willfully
caused by the defendant,” U.S.S.G. § 1B1.3(a)(1)(A) (2003),
and “in the case of jointly undertaken criminal activity . . . all
reasonably foreseeable acts and omissions of others in
furtherance of the jointly undertaken criminal activity,” id. §
1B1.3(a)(1)(B). Additionally, for certain offenses – including
appellant’s – relevant conduct includes “all acts and omissions
described in subdivisions (1)(A) and (1)(B) above that were part
of the same course of conduct or common scheme or plan as the
offense of conviction.” Id. § 1B1.3(a)(2).
Eleven instances of fraud or attempted fraud against six
financial institutions were included in the PIR’s determination
of McCants’ relevant conduct. According to the allegations in
the PIR, unnamed co-conspirators used documents provided by
McCants to obtain fraudulent loans or lines of credit. PIR ¶¶ 16-
26. No allegation of bank fraud listed in the PIR accuses
McCants of any involvement beyond providing the necessary
credit histories and documents. These 11 offenses allegedly
12
resulted in a loss of $110,252.15, and they form a substantial
portion of the losses attributed to McCants by the PIR.
Conduct related to the bank fraud scheme was undeniably
“pivotal” in arriving at McCants’ sentence, but the record is not
clear enough to automatically assign culpability from that
scheme to McCants. This is not to say the record clearly
contravenes the sentence he received, only that crucial facts
remain unsettled. Without the benefit of Rule 32 findings, we
cannot properly assess the sentence McCants received.
The PIR does not specify what provision of the relevant
conduct guideline justifies inclusion of the bank fraud losses.
As noted above, there are three distinct criteria for including
relevant conduct beyond the crime of conviction. The PIR
invokes all three – that is, U.S.S.G. §§ 1B1.3(a)(1)(A),
(a)(1)(B), and (a)(2) – but provides no analysis specific to each
subsection. See PIR at 30-31. The Government has argued that,
in conjunction with the other evidence adduced against
McCants, we can infer that the District Court’s factual findings
warranted inclusion of the bank fraud operation under §
1B1.3(a)(1)(A). With respect to the other relevant conduct
provisions in the Guidelines, the Government maintains that
assignment of responsibility for the bank fraud is clear enough
under § 1B1.3(a)(1)(A) that it is “unnecessary” to address
subsections (a)(1)(B) or (a)(2). Gov’t Br. at 46-47. We address
only the inference that the Government draws from the record
– that the District Court concluded that McCants aided, abetted,
or counseled Buchanan.
To link McCants to the bank fraud under § 1B1.3(a)(1)(A),
the Government leans heavily on the assertion that McCants
“counseled” Buchanan on how to use his illicit materials to
execute bank fraud. As recounted in Buchanan’s testimony, the
counseling he received from McCants consisted of two
admonitions: (1) that “[w]hen you get too many loans at one
place, they start noticing and . . . you’ll either get caught or the
13
loan won’t go through,” and (2) that with respect to the
appropriate appearance when attempting to obtain a fraudulent
loan, one “can’t look like someone on drugs going to pick up a
loan.” Tr. 3/3/04 at 83. In addition to this exchange, the
Government points to evidence that McCants provided the
documents used in the fraud. We note also that the record
contradicts the PIR on a critical matter relating to the extent of
McCants’ involvement with the Buchanan conspiracy. The PIR
asserted that McCants “would typically receive a ‘one-third
payment’ for his activities, either at the time he produced a loan
package . . . or after a fraudulent loan was obtained.” PIR ¶ 13.
But Buchanan testified that McCants’ products had bounded
prices ranges, see Tr. 3/03/04 at 96-97, 99, and that the variation
in price “all depends on the workload during that day, workload
meaning that if he’s in a good mood he’ll give it to you for
whatever price,” but on occasions where “he needs some money
. . . then it would be a different price,” Tr. 3/5/04 at 10. There
is nothing to support a finding that McCants received a “one-
third payment for his activities.”
This record simply does not provide any obvious insight
into what facts propelled the District Court’s decision to attach
the losses from the bank fraud conspiracy to McCants. This is
especially troubling because the testimonial evidence seems to
contradict the PIR’s allegation that McCants profited in direct
proportion to the Buchanan conspiracy’s successes. We have no
way to tell how the District Court resolved that inconsistency.
That aside, it is not apparent whether the District Court defined
McCants’ relevant conduct purely on the basis of his
transactions with Buchanan, or if the added involvement of
“counseling” Buchanan tipped the scale.
It is also unclear what findings the District Court relied on
to assign McCants responsibility for the “Celvin McCants”
loans. The PIR’s only discussion of those loans was the
following: “Furthermore, the government indicated that the
14
defendant is responsible for two defaulted loans [using the name
Celvin McCants] in the amount of $32,949 . . . .” PIR ¶ 33
(brackets in original). There is no evidence in the record
indicating the basis for attributing these loans to McCants. The
Government argues that McCants conceded the issue below,
because he did not specifically contest the veracity of this
allegation. But this claim is unpersuasive. McCants offered a
counter-calculation of the amount of loss that should be
attributed to him and it did not include the losses associated with
the “Celvin McCants” loans. This was enough to put the
Government – and the District Court – on notice that the issue
was in dispute. Yet the District Court never made findings to
resolve the dispute.
Similarly, the District Court’s failure to heed Rule 32
deprives us of the ability to review the number of “access
devices” – i.e., misappropriated credit cards – it attributed to
McCants. Appellant denies the Government’s allegation that he
sold them to Buchanan in a controlled buy. The District Court
gave no indication as to whether or why it credited the
Government’s account. McCants also argues that the
“obliterated” credit cards found in his possession, accounting for
more than a dozen of the nearly three hundred attributed to him,
cannot count as “access devices” under U.S.S.G. § 2B1.1,
because the absence of an account number renders those cards
incapable of penetrating any credit account. The Government
counters that anything that can be used “in conjunction with” an
account number falls within the statutory definition of “access
device.” See 18 U.S.C. § 1029(e)(1). We have not previously
addressed this question, though two of our sister circuits have
issued potentially divergent opinions. Compare United States
v. Nguyen, 81 F.3d 912 (9th Cir. 1996) (holding that blank credit
cards are access devices), with United States v. Abozid, 257 F.3d
191 (2d Cir. 2001) (holding that blank airline ticket stock is not
an access device as long as it lacks an account number). We
will not engage this issue now. Again, we flag it only to
15
underscore the need for written sentencing findings in accord
with Rule 32.
Although the parties urge us to rule on the proper
interpretation of the “sophisticated means” enhancement in
§ 2B1.1(b)(8) of the Guidelines, it would be inappropriate for us
to do so in the absence of more specific factual findings by the
District Court. Appellant asserts that the District Court
inappropriately enhanced his sentence because he utilized
sophisticated technology, whereas the enhancement is meant to
target schemes relying on sophisticated methods of concealment.
The Government contends that, even under that interpretation,
McCants’ operation qualifies for the enhancement since he
operated out of multiple locations and exhibited impressive skill.
Unfortunately, we have no way to discern the District Court’s
view. Its only comments on the subjects, quoted supra, are
cryptic and unspecific. They reveal nothing about the District
Court’s view of the enhancement’s application or the facts that
triggered it in this case.
III. CONCLUSION
For the reasons indicated above, we remand the case for the
District Court to resentence McCants in accord with Rule 32.