United States v. Malouf

United States Court of Appeals
For the First Circuit

No. 05-2245

UNITED STATES OF AMERICA,

Appellant,

v.

MICHAEL MALOUF,

Defendant, Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Nancy Gertner, U.S. District Judge]

Before

Boudin, Chief Judge,
Torruella and Dyk,* Circuit Judges.

William D. Weinreb, Assistant United States Attorney, with
whom Michael J. Sullivan, United States Attorney, was on brief, for
appellant.
Frank J. McGee, on brief, for appellee.
Judith H. Mizner, Assistant Federal Public Defender, Federal
Defender Office, with whom Miriam Conrad, Federal Public Defender,
Districts of Massachusetts, New Hampshire and Rhode Island, was on
brief, as amicus curiae in support of appellee.

October 13, 2006

*
Of the Federal Circuit, sitting by designation.
 TORRUELLA, Circuit Judge. On September 10, 2003,

appellee Michael Malouf ("Malouf") was charged in Count One of a

two-count indictment with conspiracy to distribute, and to possess

with intent to distribute, five kilograms or more of cocaine and an

unspecified amount of marijuana, in violation of 21 U.S.C. §§ 841

(a)(1) and 846. Section 841(b)(1)(B) imposes upon a defendant with

a prior felony conviction a mandatory minimum sentence of ten years

for offenses involving 500 grams or more of a substance containing

cocaine. On May 28, 2004, Malouf pled guilty to the indictment,

but he reserved the right to contest the amount of drugs

specifically attributable to him. At sentencing, the court found

that the government had proved by a fair preponderance of the

evidence that Malouf was responsible for more than 500 grams of

cocaine. However, the court found that the government had not

proved its case beyond a reasonable doubt. Because the district

court found that a fact that triggers a mandatory minimum sentence

must be proved beyond a reasonable doubt, the judge sentenced

Malouf to 60 months' imprisonment. After careful consideration,

we reverse.

I.

In 2001, the Federal Bureau of Investigation ("FBI")

undertook an investigation of drug trafficking in the South Shore

area of Massachusetts. Stephen Nicholson ("Nicholson") was one of

the initial targets of the investigation and he would ultimately be

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one of Malouf's co-defendants. Between April 14 and June 13 2002,

the government intercepted Nicholson's telephone calls. The

wiretap surveillance revealed that Nicholson was selling ounce

quantities of cocaine to various buyers and that Malouf was his

primary customer. The government also conducted physical

surveillance of Nicholson and Malouf, among others.

At the change of plea hearing on May 28, 2004, Malouf

pled guilty to the charge of conspiracy to distribute, and to

possess with intent to distribute, five kilograms or more of

cocaine and a quantity of marijuana in violation of §§ 841(a)(1)

and 846. The government described the minimum applicable penalty

as follows: "because the defendant has a prior felony drug

conviction and an 851 information1 has been filed, if he's found

accountable for 500 grams or more of cocaine he'd be subject to a

ten-year minimum mandatory sentence and a minimum mandatory eight-

year term of supervised release." Malouf admitted that he had

1
21 U.S.C. § 851 provides that, where the government seeks to
establish prior convictions for the purpose of increasing the
applicable criminal penalties for a drug offense under § 841, the
proper procedure is as follows:

No person who stands convicted of an offense under this
part shall be sentenced to increased punishment by reason
of one or more prior convictions, unless before trial, or
before entry of a plea of guilty, the United States
attorney files an information with the court (and serves
a copy of such information on the person or counsel for
the person) stating in writing the previous convictions
to be relied upon.

21 U.S.C. § 851(a)(1).

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conspired with Nicholson and others to distribute cocaine and

marijuana, and he agreed that the conspiracy-wide total drug weight

exceeded 500 grams. However, he notified the court of his

intention to contest the quantity of drugs specifically

attributable to him at sentencing.

At the sentencing hearing on December 20, 2004, Malouf's

counsel again indicated that he intended to contest certain of the

alleged cocaine transactions. The court then directed both parties

to submit memoranda identifying the contested transactions and

establishing their competing interpretations of the relevant

intercepted telephone calls.

On January 27, 2005, the government submitted a Corrected

Sentencing Memorandum and chart alleging that Malouf participated

in eighteen separate cocaine transactions involving approximately

20.5 ounces (581 grams) of cocaine during, or immediately prior to,

the wiretap period. Malouf contested four of the eighteen

transactions. At the sentencing hearing on March 15, 2005, Malouf

first contested an alleged two-ounce (56.7-gram) transaction that

occurred two days prior to the April 14, 2002, commencement of the

wiretap period. Malouf challenged this transaction solely on the

ground that it fell outside of the wiretap period. Because the

court found that Malouf was not challenging the drug quantity or

the government's interpretation of the telephone calls referring to

the transaction, the court dismissed Malouf's objection.

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 Next, Malouf contested an alleged one-ounce (28.35-gram)

transaction on April 25 and another on April 27 on the ground that

there was insufficient evidence that they actually transpired. The

court agreed that the evidence was insufficient to prove either

transaction, resulting in a 56.7-gram reduction of the total drug

quantity attributable to him.

Finally, Malouf challenged the alleged June 11 one-ounce

(28.35-gram) transaction. Although Malouf did not contest the

government's interpretation of a telephone conversation on that

date in which he and Nicholson discussed a cocaine transaction that

was to take place later that day, he argued that "there's no

evidence that the meeting ever happened." The government urged the

court to infer that the meeting took place because there were "no

other phone calls afterward indicating that it did not take place."

Because it was clear that the applicability of the ten-year

mandatory minimum would turn on the court's determination as to the

June 11 transaction, the court continued the sentencing hearing and

invited both parties to provide additional evidence.

When the sentencing hearing resumed on March 23, 2005,

neither party presented new evidence as to the June 11 transaction.

The critical issue was whether the appropriate legal standard by

which to judge a fact triggering a mandatory minimum sentence was

beyond a reasonable doubt or by a fair preponderance of the

evidence. The court determined that "facts which determine a

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mandatory minimum ought to go before a jury," or, if both parties

agree to waive a jury trial, the sentencing judge "stands in the

shoes of the jury, and the standard is beyond a reasonable doubt."

The government objected on the ground that "there's no right under

the Sixth Amendment, the due process clause or any other source of

law to a jury trial or beyond a reasonable doubt standard with

respect to any sentencing fact, the determination of which would

result in a sentence below the statutory maximum." When the court

dismissed the government's objection, the government agreed to

waive any jury trial right.

The court determined that although it would find that the

June 11 transaction had occurred as alleged if the applicable

standard was a fair preponderance of the evidence, it "could not

conclude beyond a reasonable doubt" that the transaction had in

fact taken place. As a result, the court declined to hold Malouf

accountable for the one ounce (28.35 grams) he allegedly purchased

in the June 11 transaction. The court thus concluded that Malouf

was accountable for a total of only 17.5 ounces (496.125 grams).

Because the total was less than 500 grams of cocaine, the ten-year

mandatory minimum sentence did not apply. Malouf's base offense

level was 26, and the court reduced it to 23 for acceptance of

responsibility. Malouf's criminal history category was IV, but the

court brought it down to III because "at least two points of the

criminal history derived from [his] addiction problems." The

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guidelines sentencing range was 57 to 71 months, and the court

sentenced Malouf to 60 months' imprisonment and a six-year term of

supervised release.

On June 14, 2005, the district court issued a written

opinion addressing four separate issues pertaining to the

sentencing of Malouf. United States v. Malouf, 377 F. Supp. 2d 315

(D. Mass. 2005). Explaining the logic underlying Malouf's

sentence, the district court asked,

(1) Do the drug quantities outlined in 21
U.S.C. § 841 comprise elements of offenses, or
sentencing factors? If the former, the
relevant case is Apprendi, a jury trial is
required and the standard of proof is beyond a
reasonable doubt; if the latter, it is Harris,
drug quantity can be determined by a judge,
and the standard is a fair preponderance of
the evidence. (2) What is the continued
efficacy of Harris in the light of the Court's
rulings in Blakely and Booker? (3) What is a
district court to do when the First Circuit's
interpretation of § 841 relies on Supreme
Court precedent which predates Blakely and
Booker? (4) In the alternative, however the
facts are characterized (as sentencing factors
or elements), where facts have a significant,
indeed determinative impact, does the Due
Process Clause of the Fifth Amendment require
the application of the beyond a reasonable
doubt standard?

Id. at 317.

As to the first issue, the court found that "§ 841 is an

offense-defining statutory provision, all elements of which must be

tried before the jury." Id. at 328. As to the second question,

the district court determined that "the breadth of the holdings in

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Booker and Blakely have in fact overruled Harris." Id. at 326.

With regard to the third issue, although the court acknowledged

that our decision in United States v. Goodine, 326 F.3d 26 (1st

Cir. 2003) required a different result, it determined that Goodine

was not binding because of its "reliance on Supreme Court precedent

which is crumbling." Id. at 325. Finally, as to the due process

issue, the court found that quantity must be proved beyond a

reasonable doubt "[i]f a substantial sentence hinges on a finding

of a specific quantity" because in such cases courts "should have

a high degree of confidence in this finding." Id. at 329.

II.

The government argues on appeal that the district court

erred by refusing to impose on Malouf a ten-year mandatory minimum

sentence under 21 U.S.C. § 841(B)(1)(b) despite finding by a

preponderance of the evidence that he was accountable for more than

500 grams of cocaine. The government challenges only the district

court's legal determinations, which we review de novo. Goodine,

326 F.3d at 27.

A. Harris

The government first contests the district court's

conclusion that the Supreme Court's decisions in United States v.

Booker and Blakely v. Washington overruled its earlier opinions in

Harris v. United States and McMillan v. Pennsylvania.

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 1. Relevant Precedent

We begin with a brief discussion of relevant Supreme

Court precedent. In McMillan v. Pennsylvania, the Court sustained

a statute that allowed the sentencing judge to find, by a

preponderance of the evidence, a fact that increased the minimum

penalty for a crime. 477 U.S. 79, 79 (1986). In McMillan, the

Court distinguished between offense elements, which must be proved

beyond a reasonable doubt, and sentencing factors, which may be

proved by a preponderance of the evidence. Id. at 91. In Apprendi

v. New Jersey, the Court held that "any fact that increases the

penalty for a crime beyond the prescribed statutory maximum must be

submitted to a jury, and proved beyond a reasonable doubt." 530

U.S. 466, 490 (2000) (emphasis added). Two years later in Harris,

the Court held that Apprendi did not apply to facts that increase

the mandatory minimum sentence and reaffirmed McMillan. 536 U.S.

545, 545 (2002) (emphasis added). In Blakely v. Washington, the

Court found unconstitutional a state trial court's imposition of a

sentence that was above the statutory maximum, on the basis of the

judge's finding of fact. 542 U.S. 296, 305 (2004). The Blakely

court held that "the 'statutory maximum' for Apprendi purposes is

the maximum sentence a judge may impose solely on the basis of the

facts reflected in the jury verdict or admitted by the defendant."

Id. at 303. Finally, in United States v. Booker, the Court held

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that the reasoning of Blakely should be applied to the Federal

Sentencing Guidelines. 543 U.S. 220, 226-27 (2005).

2. The district court's analysis

The district court in the case before us reasoned that

Blakely and Booker actually "broadened Apprendi by requiring that

all facts 'which the law makes essential to the punishment' be

subject to Sixth Amendment protections." Malouf, 377 F. Supp. 2d

at 324. The judge determined further that Blakely and Booker

evince the Court's movement toward an "impact test" that focuses

more on "the impact of such facts upon punishment, rather than on

the formalistic distinctions between sentencing factors and offense

elements." Id. According to the district court, this "impact

test" approach "necessarily casts doubt on Harris' distinction

between mandatory minimum provisions and statutory maximums." Id.

Ultimately, the court concluded, "[i]n my judgment, the breadth of

the holdings in Booker and Blakely have in fact overruled Harris.

The Court has gone from holding that the Sixth Amendment is

implicated in the determination of facts that increase a statutory

maximum (Apprendi) to applying the Sixth Amendment to all facts

'essential to the punishment' (Booker and Blakely)." Id. at 326

(footnote omitted).

We need not delve deeper into the district court