UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 00-40177
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
VERSUS
MANUEL ALBERTO MARTINEZ, also known as James A. Dupont, also
known as Albert Longoria,
Defendant-Appellant.
Appeal from the United States District Court
for the Southern District of Texas
August 27, 2001
Before SMITH, DUHÉ and WIENER, Circuit Judges.
DUHÉ, Circuit Judge:
Appellant Manuel Alberto Martinez (“Martinez”) appeals his
sentence for mail fraud, theft from organizations receiving federal
funds, and money laundering, in violation of 18 U.S.C. §§ 1341,
666(a)(1)(A), and 1956(a)(1)(B)(i), respectively. He raises three
challenges. Because we find no error by the district court in
connection with one challenge, that appeal of another was waived by
his plea agreement, and that we lack jurisdiction to consider the
remaining challenge, we dismiss in part and affirm in part.
BACKGROUND
Martinez served as the City Clerk for the city of La Feria,
Texas. During his tenure, he falsified numerous city records in
order to misappropriate money from the city and from entities
making payments to the city. Martinez pleaded guilty to one count
each of mail fraud, theft from an organization receiving federal
funds, and money laundering, in return for favorable sentencing
recommendations from the government. As part of this agreement,
Martinez waived his right to appeal his sentence, unless (1) his
sentence was illegal, as set forth in 18 U.S.C. § 3742(a); (2) he
alleged claims of ineffective assistance of counsel; or (3) he
alleged claims of prosecutorial misconduct.
The Pre-Sentence Report (“PSR”) recommended that because the
counts to which Martinez pleaded guilty involved substantially the
same harm, they should be grouped. Under § 3D1.3(a) of the United
States Sentencing Commission Guidelines, when counts are grouped
together, the applicable offense level is the highest offense level
of the counts in the group. Therefore, the PSR recommended that
Martinez be sentenced at the level for his most serious offense –
money laundering. The PSR then recommended increasing his offense
level by four, because his offense involved more than $600,000 but
less than $1,000,000. See U.S.S.G. § 2S1.1(b)(2)(E) (1998). It
recommended adding two levels under § 3B1.3, because Martinez had
abused a position of trust, and another two levels pursuant to §
3C1.1 for obstruction of justice. Three levels were subtracted for
2
acceptance of responsibility, yielding a total offense level of 25.
The PSR then recommended a sentencing range of 57-71 months.
Martinez lodged numerous objections to the PSR, but the
district court sustained only his objection to the imposition of
the upward adjustment for abuse of trust. The court then sentenced
him to 57 months of imprisonment, the highest sentence possible at
the newly-calculated range. It also imposed a term of three years’
supervised release, and ordered Martinez to pay $953,322.07 in
restitution.
Martinez appeals his sentence and the restitution order,
contending that the district court erred by (1) using the money
laundering count to calculate the applicable offense level; (2)
relying on the PSR’s findings about the amount of loss; and (3)
applying the upward adjustment for obstruction of justice.
DISCUSSION
I. Waiver
The government argues that pursuant to his plea agreement,
Martinez waived his right to appeal his sentence and the manner in
which it was calculated. Moreover, because Martinez failed to file
a reply brief responding to the government’s waiver theory, the
government contended at oral argument that Martinez has waived any
right to argue against that theory, therefore, his appeal should be
dismissed.
Generally speaking, a defendant waives an issue if he fails to
adequately brief it. See United States v. Thames, 214 F.3d 608,
3
611 n.3 (5th Cir. 2000); see also Fed. R. App. P. 28(a)(9)(A)
(Appellant’s brief must contain his “contentions and the reasons
for them, with citations to the authorities and parts of the record
on which the appellant relies . . . .”). Indeed, our court has
even gone so far as to sanction defense counsel for bringing a
claim on appeal that is plainly barred by the plea agreement, and
failing to explain why the defendant’s claims are not waived. See
United States v. Gaitan, 171 F.3d 222, 224 (5th Cir. 1999).
Although Martinez’s counsel offered no excuse for the gross
failure to brief this issue, we will nevertheless consider the
appeal. “[T]he issues-not-briefed-are-waived rule is a prudential
construct that requires the exercise of discretion.” United States
v. Miranda, 248 F.3d 434, 443 (5th Cir. 2001). We elect to exercise
our discretion because the defendant’s waiver of his right to
appeal would deprive us of jurisdiction, see United States v.
Henderson, 72 F.3d 463, 465 (5th Cir. 1995) (treating the waiver of
an appeal right as a jurisdictional question), and we may examine
Martinez’s plea agreement sua sponte to determine whether we may
hear his claims. See Goonsuwan v. Ashcroft, 252 F.3d 383, 385 (5th
Cir. 2001). Moreover, as we will develop more fully below, we find
this case distinguishable from Gaitan, in that at least some of
Martinez’s claims are not plainly barred by his plea agreement
waiver. Therefore, we will exercise our Rule 28 discretion to
consider whether Martinez has preserved his claims for appeal.
A defendant may knowingly and voluntarily waive his right to
4
appeal in a valid plea agreement. See United States v. Melancon,
972 F.2d 566, 567-68 (5th Cir. 1992). Martinez has not argued that
his waiver was uninformed or involuntary, nor does the record admit
of any doubt as to Martinez’s understanding of and free consent to
the waiver. However, the plea agreement provided that it did not
“affect the rights of the defendant to appeal an illegal sentence
as set forth in Title 18, United States Code, Section 3742(a).”
This statute provides that a defendant has a right to appeal his
sentence if it “(1) was imposed in violation of law; (2) was
imposed as a result of an incorrect application of the sentencing
guidelines; or (3) is greater than the sentence specified in the
applicable guideline range . . . ; or (4) was imposed for an
offense for which there is no applicable sentencing guideline and
is plainly unreasonable.” 18 U.S.C. § 3742(a). The plea agreement
exception for claims brought pursuant to § 3742(a) may negate most
of the waiver, and we must construe all ambiguities in the plea
agreement against the government. See United States v. Somner, 127
F.3d 405, 408 (5th Cir. 1997).
Martinez raises three issues: (1) his offense level should
have been calculated using the fraud count, not the money
laundering count; (2) the court should not have relied on the PSR’s
findings regarding the amount of the loss attributable to Martinez,
and (3) the upward adjustment for obstruction of justice was not
warranted. We hold that Martinez’s first and third points of
contention clearly allege a misapplication of the sentencing
5
guidelines under § 3742(a)(2) so are not waived by his plea
agreement. However, Martinez’s second issue regarding the court’s
adoption of the PSR’s determination about the amount of loss, is
plainly waived by the agreement. Martinez’s argument on this point
challenges the district court’s fact finding, and therefore does
not fall within any of the four exceptions contained in § 3742(a).1
We dismiss the appeal as to that claim.
II. Offense Level Determination
Martinez contends that the district court should have used the
fraud count to calculate his base offense level, rather then the
money laundering count. The court followed § 3D1.2 of the
guidelines, which requires that counts involving substantially the
same harm be grouped together. Martinez does not object to this
grouping. The court then went on to apply § 3D1.3(a), which
instructs that when multiple counts of conviction are grouped, the
court should apply the offense level corresponding to the most
serious offense in the group. Accordingly, the court applied the
1
Martinez does, however, also contend that the court’s
adoption of these findings constituted a denial of due process
because they were materially inaccurate. See United States v.
th
Smith, 13 F.3d 860, 866-67 (5 Cir. 1994). Even if we were to
accept that such a claim alleged that his sentence was imposed in
violation of law under § 3742(a)(1), and therefore was not waived,
the claim would fail. Martinez presented absolutely no evidence
demonstrating that the information in the PSR was materially
untrue. See United States v. Glinsey, 209 F.3d 386, 393 (5th Cir.),
cert. denied, 531 U.S. 919, 121 S. Ct. 282 (2000) (noting the
defendant bears the burden of demonstrating that the information in
the PSR is materially inaccurate, and if the defendant fails to
carry his burden the court may adopt the PSR findings without
further explanation).
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offense level applicable to the money laundering count, i.e., the
highest offense level in the group. Martinez, however, contends
that the court erred in its interpretation of the guidelines,
because it failed to conduct a “heartland” analysis to determine if
his conduct was the type that the money laundering statute was
designed to punish. Although he concedes that § 3D1.3(a) directs
the court to use the highest offense level, he points out that the
introduction to Appendix A of the guidelines states: “If, in an
atypical case, the guideline section indicated for the statute of
conviction is inappropriate because of the particular conduct
involved, use the guideline section most applicable to the nature
of the offense conduct charged in the count of which the defendant
was convicted.” U.S.S.G., app. A at 425 (1998).
We review the district court’s interpretation of the
guidelines de novo, and its findings of fact for clear error.
United States v. Hill, 42 F.3d 914, 916 (5th Cir. 1995). If,
however, the district court recognizes its discretion to depart
downward from the sentencing guidelines and refuses to do so, that
decision, unless based on a violation of law, is unreviewable on
appeal. United States v. Buenrostro, 868 F.2d 135, 139 (5th Cir.
1989).
Relying on United States v. Smith, 186 F.3d 290, (3rd Cir.
1999), Martinez urges us to conduct a de novo review of the court’s
decision to calculate his base offense level according to the money
laundering count. In Smith, the Third Circuit held that in
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“atypical cases,” the guidelines require that the court determine
whether the defendant’s offense conduct falls in the “heartland” of
the applicable guideline, i.e., “‘a set of typical cases embodying
the conduct’ described in each guideline.” Id. at 297-98
(citations omitted). The court must conduct this analysis at two
stages: first, when making the initial choice of the appropriate
guideline, and second, in the context of a departure request. Id.
at 298. In the former situation, the court’s decision is a “legal
function that requires the court to interpret the guideline in
light of its intention or purpose,” therefore, it is subject to
plenary review. Id. If, however, the court decides to deny a
departure request, the Third Circuit acknowledged that decision is
not subject to appellate review. Id. at 297.
Martinez urges us to consider the court’s decision in his case
as an initial selection of the applicable guideline. He also
contends that the legislative history of the money laundering
guideline indicates that the guideline was intended to cover
offenses where: (1) the laundered funds derived from serious
underlying criminal conduct such as drug trafficking; (2) the
financial transaction was separate from the underlying crime and
was undertaken either to (a) make it appear that the funds were
legitimate, or (b) promote additional criminal conduct. According
to Martinez, his is an “atypical case” which did not involve the
aforementioned conduct, and which more properly implicates the base
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offense level for fraud.2
Our circuit, however, has not applied the Smith test. Rather,
we have interpreted the heartland analysis as a permissive basis
for exercising discretion to apply a downward departure, rather
than a component of the initial selection of the applicable
guideline. See, e.g., United States v. McClatchy, 249 F.3d 348,
359-60 (5th Cir. 2001); United States v. Wilson, 249 F.3d 366, 379-
80 (5th Cir. 2001); United States v. Dadi, 235 F.3d 945, 954-55 (5th
Cir. 2000), cert. denied, 121 S. Ct. 2230 (2001); United States v.
Davis, 226 F.3d 346, 359 (5th Cir. 2000), cert. denied, 121 S. Ct.
1161 (2001); United States v. Hemmingson, 157 F.3d 347, 360 (5th
Cir. 1998); United States v. Leonard, 61 F.3d 1181, 1185 (5th Cir.
1995); and United States v. Willey, 57 F.3d 1374, 1391-92 (5th Cir.
1995). Our approach is more consistent with the overall intent of
the guidelines, as set forth in the introduction to the Guidelines
Manual:
The Commission intends the sentencing courts to treat
each guideline as carving out a ‘heartland,’ a set of
typical cases embodying the conduct that each guideline
2
We note in passing that Smith is no longer good law.
Congress adopted Amendment 591 to the sentencing guidelines,
effective November 1, 2000, specifically in response to the issue
addressed in Smith. “Under the guidelines as amended, sentencing
courts may not conduct an inquiry into the heartland of [the
guideline applicable to money laundering] and courts have no
discretion to decide that the money laundering guideline is
inappropriate or not the most applicable guideline on the facts of
a given case.” United States v. Diaz, 245 F.3d 294, 303 (3rd Cir.
2001). However, Martinez was sentenced before the amendment became
effective, and the amendment does not apply retroactively. See id.
at 303-04.
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describes. When a court finds an atypical case, one to
which a particular guideline linguistically applies but
where conduct significantly differs from the norm, the
court may consider whether a departure is warranted.
U.S.S.G. ch. 1, pt. A, § 4(b) (1998).
The district court in Martinez’s case determined to use the
money laundering count to calculate his base offense level after
conducting the proper heartland analysis. There is no indication
anywhere in the record that the court believed it did not have the
authority to apply a downward departure and sentence Martinez
according to the fraud count rather than the money laundering
count. Therefore, because the court’s decision was a refusal to
grant a downward departure, we cannot review it. See Dadi, 235
F.3d at 954. We, therefore, dismiss the appeal as to that issue.
III. Obstruction of Justice Enhancement
Section 3C1.1 provides that the court may increase a
defendant’s offense level if:
(A) the defendant willfully obstructed or impeded, or
attempted to obstruct or impede, the administration of
justice during the course of the investigation,
prosecution, or sentencing of the instant offense of
conviction, and (B) the obstructive conduct related to
(i) the defendant’s offense of conviction and any
relevant conduct; or (ii) a closely related offense . .
. .
The PSR recommended a two level increase because, several months
prior to his June 1998 arrest, Martinez obstructed justice by
transferring assets to certain business entities to evade
investigators; acquired a false passport in order to evade
authorities; and failed to appear before a state justice of the
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peace on state charges arising from the same conduct which formed
the basis of his federal offense. Martinez was a fugitive
thereafter, and during this time his family filed a missing persons
report for him.
The district court overruled Martinez’s objection to the
obstruction enhancement. The court appeared to focus on the
failure to appear, stating: “I find that he willfully – that this
conduct was willful in that he failed to appear – for a judicial
proceeding. And these are all events that had to do with the state
charges that ultimately . . . were subsumed [into the federal
prosecution].”
Martinez argues that the court erred in imposing the
enhancement because (1) he was unaware of any federal investigation
of his conduct prior to his arrest on federal charges; (2) the
testimony of an FBI agent at the sentencing hearing rendered
questionable the PSR’s finding that Martinez was a fugitive, and
(3) the failure to appear occurred in connection with a state
prosecution, so it could not have occurred “during the course of
the investigation, prosecution, or sentencing of the instant
offense of conviction.” At oral argument, Martinez’s counsel also
asserted that there is no clear indication in the record of when
the federal investigation began.
“A finding of obstruction of justice under § 3C1.1 is a
factual finding reviewed for clear error.” United States v. Upton,
91 F.3d 677, 687 (5th Cir. 1996). “However, we review the district
11
court's interpretation or application of the sentencing guidelines
de novo.” Id.
We find it unnecessary to decide whether Martinez’s failure to
appear on state charges may serve as grounds for an enhancement of
his sentence for federal offenses based on the same underlying
criminal conduct. This is so because there is other evidence in
the record sufficient to justify the application of the obstruction
of justice enhancement. Specifically, we are persuaded by the
evidence that Martinez obtained a false passport for the purpose of
evading authorities, and that he transferred numerous assets to
businesses entities controlled by him or his family members in the
months prior to his arrest.3 The district court adopted the PSR’s
fact findings. Further, despite Martinez’s contention to the
contrary, the record clearly shows that the FBI investigation
commenced at the end of 1996, well before Martinez’s obstructive
conduct. The factual summary attached to Martinez’s plea
agreement, which Martinez initialed on every page and then signed,
notes that the FBI investigation was initiated on December 16,
1996, the last day that Martinez reported for work in the City
3
See U.S.S.G. § 3C1.1, cmt. n.4(c) and (d) (1998), noting that
the following conduct may justify imposition of the enhancement:
(c) producing or attempting to produce a false, altered,
or counterfeit document or record during an official
investigation . . .
(d) destroying or concealing . . . evidence that is
material to an official investigation or judicial
proceeding . . . .
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Clerk’s office. This summary was read in open court when Martinez
entered his plea, and Martinez confirmed under oath that the
summary was true.4 Therefore, we conclude that, although for
reasons other than those stated by the district court, Martinez
“willfully obstructed or impeded, or attempted to obstruct or
impede, the administration of justice during the course of the
investigation” of Martinez’s federal offenses, and that such
conduct was clearly related to his federal offenses. The court’s
enhancement of Martinez’s sentence under § 3C1.1 was not error.
AFFIRMED IN PART and APPEAL DISMISSED IN PART.
4
Martinez did not agree with the amount of the loss attributed
to him by the government, but upon further questioning by the
court, he confirmed that he had no other objection to the factual
summary:
THE COURT: Then am I correct in believing that the reason
that you’re pleading guilty is because what the
Government has just recited as the evidence is, in fact,
true? Now, you’ve told me that you disagree with the
totals, especially the $950,000, but I’m asking you
whether you are pleading guilty to the offense of mail
fraud, theft from organizations receiving federal funds,
and money laundering because the actions that the
Government has summarized as your being guilty of are, in
fact, true?
THE DEFENDANT: Yes, ma’am.
Record, vol. 2, at 46.
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