United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 04-2386 *
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United States of America, *
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Appellee, *
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v. *
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George L. Young, *
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Appellant. *
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* Appeals from the United States
No. 04-2400 * District Court for the
________________ * Western District of Missouri.
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United States of America, * [PUBLISHED]
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Appellee, *
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v. *
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Kathleen I. McConnell, *
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Appellant. *
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Submitted: April 13, 2005
Filed: July 5, 2005
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Before MURPHY, HANSEN, and BENTON, Circuit Judges.
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HANSEN, Circuit Judge.
Pursuant to written plea agreements, George L. Young and Kathleen I.
McConnell pleaded guilty to mail fraud, 18 U.S.C. § 1341 (2000), wire fraud, 18
U.S.C. § 1343 (2000), making false statements, 15 U.S.C. § 50 (2000), and criminal
forfeiture, 18 U.S.C. § 982 (2000), related to a scheme to defraud investors in their
cattle businesses. Young appeals the 108-month sentence imposed by the district
court,1 and McConnell appeals her 87-month sentence. We affirm.
I.
Young, a longtime cattle rancher, and McConnell, an accountant, were
involved in various related business entities that were engaged in the cattle buying
and management business throughout the 1980s and 1990s. Appellants engaged in
fictitious transactions and represented to their clients and to banks that their
businesses owned many more cattle than actually existed. Following a decline in the
cattle market, the scheme eventually collapsed in 2001, causing Young and
McConnell to close their businesses and file for bankruptcy protection. At the time,
their businesses owned 17,000 head of cattle, although their records reported assets
consisting of over 343,000 head of cattle. Their scheme cost individual investors
approximately $147 million and cost banks approximately $36 million. Nearly $16
million was recovered from assets of the companies and distributed to the fraud
victims.
1
The Honorable Fernando J. Gaitan, Jr., United States District Judge for the
Western District of Missouri.
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Following their indictment on fraud charges, the appellants cooperated
extensively with the government agencies that were investigating the fraud. Both
appellants entered into written plea agreements and pleaded guilty to each of the
charges. At sentencing, the district court made the following adjustments to Young's
base offense level of six: an eighteen-level increase based on the amount of the loss,
U. S. Sentencing Guidelines Manual (USSG) § 2F1.1(b)(1)(S) (Nov. 2000); a two-
level increase for more than minimal planning or a scheme to defraud more than one
victim, USSG § 2F1.1(b)(2); a two-level increase for using sophisticated means,
USSG § 2F1.1(b)(6)(C); a four-level increase for substantially jeopardizing the safety
and soundness of a financial institution, USSG § 2F1.1(b)(8)(A); a two-level increase
for an offense involving the violation of a prior administrative order, USSG §
2F1.1(b)(4)(C); and a three-level decrease for acceptance of responsibility, USSG §
3E1.1(b). The court then departed downward two levels for Young's extraordinary
acceptance of responsibility, resulting in a sentencing range of 87-108 months, and
sentenced Young to 108 months of imprisonment. The court applied the same
adjustments to McConnell's base offense level except for the two-level increase for
violation of a prior administrative order. After a two-level downward departure for
extraordinary acceptance, McConnell faced a sentencing range of 70-87 months and
received an 87-month sentence.
At sentencing, both defendants challenged the USSG § 2F1.1(b)(8)(A) four-
level enhancement for jeopardizing a financial institution, and Young challenged the
§ 2F1.1(b)(4)(C) two-level enhancement for violation of a prior administrative order.
The district court rejected both challenges. On appeal, the defendants again challenge
the applicability of those same enhancements that they objected to at sentencing, and
they argue that application of the enhancements violated the Sixth Amendment as
construed in Blakely v. Washington, 124 S. Ct. 2531 (2004), and United States v.
Booker, 125 S. Ct. 738 (2005).
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II.
A. Blakely/Booker Challenge
Each of the appellants' written plea agreements contained an appeal waiver that
provided: "The defendant agrees not to appeal or otherwise challenge the
constitutionality or legality of the Sentencing Guidelines." (Plea at ¶ 12.) Appellants
argue that the appeal waivers contained in their plea agreements do not foreclose their
Blakely challenge because the waiver was not knowing, having been entered pre-
Blakely, and because the plea agreements made an exception to the plea waivers for
sentences above the statutory maximum. (Appellants' Br. at 29 n.4.) Their arguments
are unavailing. "[T]he right to appellate relief under Booker [or Blakely] is among
the rights waived by a valid appeal waiver, even if the parties did not anticipate the
Blakely/Booker rulings." United States v. Fogg, No. 04-2723, 2005 WL 1186535,
at *2 (8th Cir. May 20, 2005); see also United States v. Reeves, No. 04-2356, 2005
WL 1366432, at *3 (8th Cir. June 10, 2005) ("[A] voluntary plea of guilty
intelligently made in the light of the then applicable law does not become vulnerable
because later judicial decisions indicate that the plea rested on a faulty premise."
(Modification in original) (internal marks omitted)); United States v. Killgo, 397 F.3d
628, 629 n. 2 (8th Cir. 2005) ("The fact that [the defendant] did not anticipate the
Blakely or Booker rulings does not place the issue outside the scope of his waiver.");
United States v. Rutan, 956 F.2d 827, 830 (8th Cir. 1992) ("[Defendant]'s assertion
that he cannot waive an unknown right is baseless."), overruled on other grounds by
United States v. Andis, 333 F.3d 886, 892 n.6 (8th Cir.) (en banc), cert. denied, 540
U.S. 997 (2003).
We have recognized that an appeal waiver does not preclude an appeal in
certain limited circumstances, including the appeal of an illegal sentence. See Andis,
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333 F.3d at 891-92 (noting that an illegal sentence is included within the miscarriage-
of-justice exception to our otherwise strict enforcement of an unambiguous appeal
waiver). "[A] sentence is illegal when it is not authorized by the judgment of
conviction or when it is greater or less than the permissible statutory penalty for the
crime." Id. at 892 (internal citation and marks omitted). Both of the appellants
pleaded guilty to counts two and three of the indictment, each of which subjected
them to a statutory sentence of not more than 30 years of imprisonment. See 18
U.S.C. §§ 1341, 1343. Young's 108-month sentence and McConnell's 87-month
sentence are well below the applicable statutory maximum; indeed, they are not even
one-third of the maximum. Although the argument that each Guidelines range
defines a separate statutory maximum was a plausible argument following the
Supreme Court's decision in Blakely, the Supreme Court ultimately remedied the
Sixth Amendment concern with the Guidelines by making the Guidelines advisory
rather than mandatory. See Booker, 125 S. Ct. at 764-66. Post-Booker, the
Guidelines ranges are merely advisory ranges, and the criminal statute of conviction
provides the maximum statutory sentence. As such, neither of the appellants'
sentences was above the applicable statutory maximum of 30 years of imprisonment,
and the miscarriage-of-justice exception for an illegal sentence does not apply. See
Reeves, 2005 WL 1366432, at *3 (rejecting a miscarriage-of-justice claim where the
sentence was within the range set by the statute of conviction).
During oral argument, counsel for appellants further argued that they were not
challenging the constitutionality of the Guidelines as a whole, but rather the level of
the burden of proof required to sustain the specific enhancements. This too is
unavailing. Their argument that the enhancements had to be found by a jury beyond
a reasonable doubt derives from the Sixth Amendment, a constitutional challenge that
they both waived. As neither appellant otherwise challenges the validity of the plea
agreement, we hold that their broad waivers of the right to appeal the constitutionality
or legality of the Guidelines encompasses a Blakely/Booker challenge, and we need
not reach the merits of the claim. See Fogg, 2005 WL 1186535, at *2.
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Even assuming that the appellants did not waive this claim, we would review
for plain error, and we find none. See United States v. Pirani, 406 F.3d 543, 550-52
(8th Cir. 2005) (en banc) (describing the four-part plain error test of United States v.
Olano, 507 U.S. 725, 731 (1993)). The district court departed downward two levels
for each defendant based on their extraordinary acceptance of responsibility, but then
sentenced each appellant at the top of their respective range. In doing so, the district
court stated that "the harshness of the sentence from where I sit and perhaps from
where the defendants sit is due because of the heinous nature of the offense" (Sent.
Tr. at 215), comparing sentences for white collar crimes to the generally harsher
sentences imposed for bank robberies and concluding that "this is just punishment"
(Id.). Neither appellant can "demonstrate a reasonable probability that the court
would have imposed a lesser sentence" had it known that the Guidelines were merely
advisory at the time of the sentencing hearing. Pirani, 406 F.3d at 553.
B. USSG § 2F1.1(b)(8)(A) enhancement for substantially jeopardizing the
safety and soundness of a financial institution.
Both defendants preserved the right to appeal the application of those
Guidelines enhancements that they contested at sentencing. The district court
increased both defendants' sentences by four levels for substantially jeopardizing the
safety and soundness of a financial institution. See USSG § 2F1.1(b)(8)(A). The
Guideline application notes explain that "[a]n offense shall be deemed to have