United States v. Dan Petri

FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA , No. 11-30337
Plaintiff-Appellee,
D.C. No.
v. 2:11-cr-00016-RSL-2

DAN PETRI, ORDER AND
Defendant-Appellant. AMENDED OPINION

Appeal from the United States District Court
for the Western District of Washington
Robert S. Lasnik, District Judge, Presiding

Argued and Submitted
December 4, 2012—Seattle, Washington

Filed February 8, 2013
Amended April 12, 2013

Before: Mary M. Schroeder, M. Margaret McKeown,
and Richard C. Tallman, Circuit Judges.

Order;
Opinion by Judge Tallman
2 UNITED STATES V . PETRI

SUMMARY*

Criminal Law

Affirming a sentence, the panel rejected the defendant’s
contention that a 2002 amendment to Fed. R. Crim. P.
32(i)(3)(B) expanded the district court’s fact-finding
responsibilities at sentencing.

The panel held that Rule 32(i)(3)(B) requires a district
court to address only unresolved factual objections to the
presentence report that make a difference in the formulation
of an appropriate sentence. The panel also held that the
district court adequately explained the reasons for fashioning
its sentence.

COUNSEL

Michael Filipovic, Assistant Public Defender, and Alan Zarky
(argued), Research Attorney, Federal Public Defender’s
Office, Seattle, Washington, for Defendant-Appellant.

Steven Masada (argued), Assistant United States Attorney,
Seattle, Washington, for Plaintiff-Appellee.

*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
 UNITED STATES V . PETRI 3

ORDER

The Opinion filed on February 8, 2013, is amended as
follows:

Slip opinion page 11, line 21: At the end of this
paragraph, insert the following sentence:

With this amendment, the panel has voted to deny the
petition for panel rehearing; Judges McKeown and Tallman
have voted to deny the petition for rehearing en banc and
Judge Schroeder so recommends.

The full court has been advised of the petition for
rehearing en banc and no judge has requested a vote on
whether to rehear the matter en banc. Fed. R. App. P. 35.

The petition for panel rehearing and petition for rehearing
en banc are DENIED. No future petitions for rehearing or
petitions for rehearing en banc will be entertained.
4 UNITED STATES V . PETRI

OPINION

TALLMAN, Circuit Judge:

A full decade after an amendment to Rule 32 of the
Federal Rules of Criminal Procedure, we are asked for the
first time to determine whether the amendment represented a
vast expansion of the district court’s fact-finding
responsibilities at sentencing. The defendant, who pleaded
guilty to aggravated identity theft and two other counts in
connection with an ATM skimming scheme, insists that Rule
32(i)(3)(B) extends the district court’s fact-finding
responsibility to all matters controverted, no matter how they
are presented, throughout the entire sentencing phase. The
rule’s context and history, though, strongly suggest otherwise
and demonstrate an intent to narrow the rule’s scope to only
those factual objections to the presentence report that have
the potential to affect the sentence. Because we cannot
square this strong evidence of legislative purpose with the
defendant’s broad interpretation, we affirm.

I

A

Defendant Dan Petri, along with at least two co-
conspirators, engaged in a scheme to skim account
information and personal identification data from ATMs. By
attaching a card reader and a camera to an ATM, they would
capture a customer’s account information and PIN. That
information allowed the creation of counterfeit bank cards,
which were then used to withdraw funds from customers’
accounts.
 UNITED STATES V . PETRI 5

The government’s evidence demonstrated that Petri had
placed and removed card readers and cameras on various
ATMs in the Seattle area on eleven different occasions
between September 25 and November 30, 2010. Petri and his
co-conspirators obtained $276,836.02 from more than 300
individual victims. Petri does not contest that he was directly
involved in installing the skimming equipment on ATMs and
that he made multiple withdrawals of large sums of cash in
aid of this criminal enterprise. However, he claims that he
received little of the profits and that he was coerced into
participating by the ringleader, a man named “Sorin” who has
yet to be apprehended.

Petri was indicted on January 19, 2011, and an 18-count
Superseding Indictment followed on May 12, 2011. A month
before trial, Petri pleaded guilty to three counts: Bank Fraud,
Conspiracy to Commit Access Device Fraud, and Aggravated
Identity Theft.

B

In the presentence report, the probation officer
recommended against granting a minor role reduction for
Petri, whom she found to be an “average participant[]” in the
offense. Before sentencing, Petri’s counsel objected to this
recommendation in the report. Petri argued that he and his
co-defendant were used by the more sophisticated individuals
in the scheme, including a man named “Sorin,” whom Petri
identified as the ringleader. Petri also argued that he had
received very little of the proceeds, suggesting that his role
was that of a minor participant. The probation officer
responded that Petri’s “repeated involvement” showed that
his role was “essential” and that he was therefore an “average
participant.” She added that she “had no information as to
6 UNITED STATES V . PETRI

how much the defendant and other coconspirators made
during this offense.”

Petri’s sentencing memorandum repeated his assertion
that he “made very little profit from this endeavor.” It also
raised a claim that “Sorin,” the putative missing mastermind,
had coerced Petri into committing the crime. Counsel argued
in his written memorandum that Petri claimed Sorin had
helped him gain entry to the United States and then tricked
Petri into using a counterfeit card the first time. After that, he
allegedly “pressed Petri . . . to assist him in the criminal
activity” by threatening to go to the police and have him
deported. The sentencing memorandum further claimed that
“Petri . . . feared Sorin” and that Petri and another conspirator
“had observed [Sorin] carrying a weapon. While his threats
were not overt, i.e., by pointing a weapon at them, the
implication to both of them was clear—they would be
physically harmed if they did not go along with Sorin’s plan.”
Petri did not cite any evidentiary support for these claims in
his memorandum. Nor did the defense offer Petri’s testimony
or any other witnesses to establish these assertions at the
sentencing hearing.

At the sentencing hearing, Petri’s counsel again invoked
the alleged co-conspirator “Sorin.” Defense counsel argued
that recently discovered documents, not in evidence,
established that Sorin was the major player in the scheme and
that Petri had limited involvement. Counsel also claimed that
Petri made “slightly less than $20,000 of wire transfers,” and
that “[h]e’s getting very little money out of this.”

The government responded that because the wire transfers
were to Petri’s native Romania, there was no way to confirm
the veracity of his claim and that all that could be said was
 UNITED STATES V . PETRI 7

that proceeds of his criminal activities, beyond reach for
restitution to his victims, would be waiting for Petri when he
was deported after completion of his federal prison sentence.
As for Petri’s claims of coercion, the government could only
say that it was still seeking the whereabouts of the mysterious
“Sorin.”

At the conclusion of the sentencing hearing, the district
court imposed its sentence. After concluding that the offense
was “very serious,” the court determined that Petri’s role,
while not that of a “leader or a ringleader,” was “very, very
active.” The court declined to apply a minor role reduction,
as Petri had requested in counsel’s written and oral objections
to the presentence report. The district judge ruled:

But I do think that, while I am not going to
grant him a minor role adjustment, I take the
role into account in saying that it justifies a
somewhat lower sentence than the guidelines
would call for.

I believe that what is appropriate, considering
all of the 3553 factors here, is to leave the
guideline range at offense level 24, criminal
history category 1, which is a guideline range
of 51 to 63 months.

But I’ll depart downward from that to a
sentence of 36 months on Counts 3 and 7, to
run concurrently, but consecutive to the 24
months on Count 17, for punishment to take
into consideration the amount of loss, the role
that Mr. Petri played, the fact that he will be
deported, the fact that, as a deportable alien,
8 UNITED STATES V . PETRI

he is not allowed to program in the same way
that other people can in the prison situation,
and that, under the circumstances, I believe
the total sentence of 60 months, or five years,
is appropriate.

The 60-month sentence fell 15 months short of the low
end of the Guidelines range the district court ultimately
settled upon and 27 months below the minimum sentence
cited in the written plea agreement’s preliminary Guidelines
calculation. Petri timely appealed the judgment. We have
jurisdiction under 28 U.S.C. § 1291 and 18 U.S.C. § 3742(a),
and we affirm.

II

Petri urges us to adopt a broad reading of Federal Rule of
Criminal Procedure 32(i)(3)(B), which was amended
specifically in 2002 to narrow its reach. Because the
structure of the rule and the intent of its drafters demonstrate
that a “controverted matter” extends only to objections to the
presentence report that make a difference in the formulation
of an appropriate sentence, we affirm.

A

At sentencing, the district court has at its disposal “a wide
variety of information that could not be considered at trial.”
United States v. Messer, 785 F.2d 832, 834 (9th Cir. 1986).
This evidentiary flexibility creates a constitutional concern:
if the information is materially false or unreliable, the district
court’s reliance on it may violate a defendant’s due process
rights. Id. In 1983, the Supreme Court (without any
subsequent congressional revision) promulgated a revised
 UNITED STATES V . PETRI 9

Rule of Criminal Procedure to help alleviate this concern.
United States v. Ibarra, 737 F.2d 825, 827 (9th Cir. 1984)
(discussing former Rule 32(c)(3)(D)); see also Rules
Enabling Act, 28 U.S.C. §§ 2071–72.

The 1983 revision, from which the rule at issue in this
case descended, “require[d] the district court, in entertaining
a challenge to a presentence report, either to decide the
challenge on the merits, or to state that no finding is
necessary because the court will not rely on the controverted
information.” Ibarra, 737 F.2d at 827. The Advisory
Committee’s note to the 1983 rule stated that it “is intended
to ensure that a record is made as to exactly what resolution
occurred as to controverted matter[s].” Fed. R. Crim. P. 32
advisory committee’s note to 1983 Amendments.

Until 2002, there was no doubt that the rule required the
district court to only address unresolved objections to the
presentence report. Then a 2002 amendment modified the
rule to current Rule 32(i)(3), upon which Petri relies. The
rule now provides:

At sentencing the court:

(A) may accept any undisputed portion of
the presentence report as a finding of fact;

(B) 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; and
10 UNITED STATES V . PETRI

(C) must append a copy of the court’s
determinations under this rule to any copy of
the presentence report made available to the
Bureau of Prisons.

Fed. R. Crim. P. 32(i)(3) (emphasis added). In the decade
since the amendment went into effect, we have occasionally
been called upon to rule on the provision’s scope, but we
have never addressed whether the amendment broadened the
rule’s reach beyond objections to the presentence report. See,
e.g., United States v. Saeteurn, 504 F.3d 1175 (9th Cir 2007);
United States v. Stoterau, 524 F.3d 988 (9th Cir. 2008).

B

Petri’s argument is a valiant attempt at grammatical
dissection. He argues that by adding “or other controverted
matter” the 2002 amendment extends the district court’s fact-
finding responsibility to every dispute raised throughout the
entire sentencing phase. This responsibility, applied to
Petri’s case, would require the district court to make a
specific ruling on the defense’s assertions that “Sorin”
coerced Petri into complicity and that Petri made only a
meager profit from the scheme.

Assuming for the moment that these matters were in
controversy, Rule 32 does not extend so far. The purpose and
context of the rule demonstrate that the district court need
only address unresolved objections to the presentence report
that relate to matters in controversy.

The rule, as worded, is somewhat ambiguous. From the
plain language of the statute, we cannot determine exactly to
what “or other controverted matter” refers. On the statute’s
 UNITED STATES V . PETRI 11

face, the government’s suggestion—that it encompasses only
specific objections to the presentence report—is no more or
less plausible than Petri’s interpretation—that it encompasses
any controversy that arises during the entire sentencing phase.

Because the Federal Rules of Criminal Procedure, once
effective, have the force and effect of law, see United States
v. Marion, 404 U.S. 307, 319 (1971), we apply “traditional
tools of statutory construction” to interpret them. Beech
Aircraft Corp. v. Rainey, 488 U.S. 153, 163 (1988) (internal
quotation marks omitted). When interpreting a statute, words
and phrases must not be read in isolation, but with an eye
toward the “purpose and context of the statute.” Dolan v.
U.S. Postal Serv., 546 U.S. 481, 486 (2006). The purpose and
context of Rule 32 demonstrate that the district court was
only required to respond to factual objections to the
presentence report that relate to a “controverted matter.”

The Advisory Committee’s notes to the amendment
clarify any ambiguity. Cf. Tome v. United States, 513 U.S.
150, 160 (1995) (stating that explanatory notes to the Federal
Rules of Evidence are “a useful guide in ascertaining the
meaning of the Rules”). The rule’s previous iteration, as we
have discussed, pertained only to unresolved objections to the
presentence report. In 2002, the Advisory Committee
worried that “a broad reading of the current rule might place
an unreasonable burden on the court without providing any
real benefit to the sentencing process.” Fed. R. Crim. P. 32
advisory committee’s note.

The committee revised the rule specifically to “narrow[]
the requirement for court findings to those instances when the
objection addresses a ‘controverted matter.’ If the objection
satisfies the criterion, the court must either make a finding on
12 UNITED STATES V . PETRI

the objection or decide that a finding is not required because
the matter will not affect sentencing or that the matter will not
be considered at all in sentencing.” Id. (emphasis added).

Although Advisory Committee notes “do not foreclose
judicial consideration” of a rule’s validity and meaning, “the
construction given by the Committee is ‘of weight.’”
Schiavone v. Fortune, 477 U.S. 21, 31 (1986) (quoting Miss.
Pub. Corp. v. Murphree, 326 U.S. 438, 444 (1946)). The
committee left little doubt that it designed this amendment to
limit Rule 32 fact-finding responsibility to those situations
when an objection to a presentence report addresses a
“controverted matter.” See United States v. McGee, 529 F.3d
691, 700 (6th Cir. 2008) (requiring the defendant to
“sufficiently controvert the facts contained in his PSR to
trigger the district court’s duty under Rule 32(i)(3)”)
(emphasis added). The structure of the rule—in which the
committee sandwiched subdivision (i)(3)(B) between two
provisions that expressly relate to the presentence
report—confirms this design. See Fed. R. Crim. P.
32(i)(3)(A), (C). In addition, Petri acknowledges that the
prior version of Rule 32 covered only objections to the
presentence report, and the Advisory Committee made clear
that the 2002 amendments were not intended to change the
meaning of Rule 32 in ways other than explained in the notes.
See Fed. R. Crim. P. 32 advisory committee’s note (“These
changes are intended to be stylistic only, except as noted
below.”).

We have mined the Advisory Committee’s meeting
minutes and agenda books from the time of the amendment,
and we find only evidence that confirms this interpretation.
In the agenda listing the committee’s proposed amendments
in March 2001, the proposal that created Rule 32(i)(3) is
 UNITED STATES V . PETRI 13

referred to as “[CR 32]—findings on controverted matters in
presentence report.” Advisory Committee on Criminal Rules,
Agenda Docketing, Doc. No. 1276 at 10 (March 6, 2001).
(emphasis added). The meeting minutes reveal that the
proposed revision “concern[ed] the contents of the
presentence report.” Advisory Committee on Criminal Rules,
April 2001 Minutes, at 12 (April 25–26, 2001). Nothing in
the amendment’s history suggests that the committee revised
the rule to extend beyond factual objections to the
presentence report.

The purpose and context of Rule 32 demonstrate that the
amendment signaled an attempt to narrow those disputes with
the presentence report on which the district court must make
a ruling, not to broaden the court’s fact-finding responsibility
beyond the report. See Saeteurn, 504 F.3d at 1179 n.10
(noting that the “earlier version of Rule 32 . . . contained
much broader language than the current version in Rule
32(i)(3)(B)” and that the “Advisory Committee amended the
Rule in part to make clear that the rule applies only to factual
disputes which affect the temporal term of sentence”); United
States v. Darwich, 337 F.3d 645, 666 (6th Cir. 2003) (“This
new rule attempts to eliminate confusion over whether courts
were required to make rulings on every objection to the PSR
or only those that have the potential to affect the sentence.”).
This holding is consistent with the due process concerns that
Rule 32(i)(3)(B) addresses. Because district courts, probation
officers, and the Bureau of Prisons rely so greatly on the
presentence report, it is of the highest priority that the court
communicate how it has resolved any alleged factual
inaccuracies in the report. Sentencing memoranda and oral
arguments do not hold the same persuasive power as the
presentence report, once adopted by the district court at
14 UNITED STATES V . PETRI

sentencing to explain how it fashioned the sentence ultimately
imposed.

District courts merit trust in their ability to weigh the
evidence and arguments raised in memoranda and the
sentencing hearing. Cf. United States v. Carty, 520 F.3d 984,
992 (9th Cir. 2008) (“We assume that district judges know
the law and understand their obligation to consider all of the
§ 3553(a) factors, not just the Guidelines.”). We need not
require courts to list their resolution of every assertion made
by counsel or the defendant at sentencing. See United States
v. Cunningham, 429 F.3d 673, 679 (7th Cir. 2005) (“We
hesitate to read the rule so broadly that the judge is obliged to
address every argument that a defendant makes at the
sentencing hearing.”). We note that although Rule
32(i)(3)(B) applies only to factual objections to the
presentence report, there may be other circumstances where
disputed evidence at sentencing may counsel for a finding by
the sentencing judge. We need not address that situation
here.

Although few other circuits have explicitly addressed
whether the amendments to what is now Rule 32(i)(3)(B)
actually broadened its scope, those that have support our
position. Both the Seventh and Tenth Circuits have examined
a question closely related to ours: whether the 1994 and 2002
amendments to the rule broadened its application beyond
allegations of “factual inaccuracy in the presentence
investigation report” to non-factual disputes. Fed. R. Crim.
P. 32(c)(3)(D) (1993).

Looking to the Advisory Committee notes, other circuits’
continuing limitation of the rule to allegations of factual
inaccuracy, and academic commentary and practice guides,
 UNITED STATES V . PETRI 15

the Tenth Circuit “t[ook the] opportunity to clarify the
operative scope of Rule 32 by stating unequivocally that,
under each version of the rule, ‘to invoke the district court’s
Rule 32 fact-finding obligation, the defendant is required to
make specific allegations of factual inaccuracy.’” United
States v. Cereceres-Zavala, 499 F.3d 1211, 1215–16 (10th
Cir. 2007) (citation omitted). The court concluded that,
because the defendant had “challenged only [a] legal
conclusion, rather than disputing factual inaccuracies in the
PSR, the district court was not required to make Rule
32(i)(3)(B) findings with respect to [his] contentions.” Id. at
1216. Although the Seventh Circuit did not define the
“precise scope of the rule,” it noted that a “sentencing judge
has no more duty than we appellate judges do to discuss
every argument made by a litigant.” Cunningham, 429 F.3d
at 678–79.

We do not suggest that the district court was prohibited
from considering the assertions that Petri’s counsel made in
either his sentencing memorandum or at the hearing. But
Rule 32 did not require the district court to expressly address
those assertions that were not factual objections to the
presentence report when it pronounced Petri’s sentence. The
sentencing judge was free to consider those arguments and
give them whatever weight, if any, he deemed appropriate.
But it was not reversible error to fail to make express findings
of fact in response to the defense argument.

C

Because Rule 32(i)(3)(B) pertains only to unresolved
objections to the presentence report, the district court had no
responsibility to address either of the arguments that Petri
raised during sentencing. It properly denied his request for a
16 UNITED STATES V . PETRI

lowering of the offense level based upon his alleged minor
role in the offense.

The presentence report makes no mention of how much
or how little Petri personally profited from the scheme. Nor
does it make any factual assertion regarding whether “Sorin”
manipulated or coerced Petri into complicity.1

“Only specific factual objections trigger Rule
32(i)(3)(B).” Stoterau, 524 F.3d at 1011. A specific factual
objection addresses a factual inaccuracy; it does not merely
object to recommendations, opinions, or conclusions. United
States v. Linholm, 24 F.3d 1078, 1085 n.7 (9th Cir. 1994).
Petri objected specifically to the probation officer’s
recommendation against a minor role reduction; he raised
these assertions in support of that objection. But he did not
allege a factual inaccuracy in the presentence report. The
district court therefore had no responsibility to rule on how
much he profited or if “Sorin” coerced him.

For good measure, the district court properly resolved
Petri’s objection to the minor role reduction by referencing
the overwhelming evidence that Petri personally placed
skimming devices on ATMs and made withdrawals from
victims’ accounts using counterfeit cards manufactured with
the data surreptitiously skimmed—facts from the presentence
report that Petri does not dispute.

1
It should also be noted that before he argued to the district court that
he was manipulated and coerced into complicity, Petri signed a plea
agreement explicitly stating that he “knowingly and voluntarily engaged
in, and conspired with others . . . to engage in, a scheme that involved
identity theft through skimming activity targeting automated teller
machines (“ATMs”) and the use of stolen personal and financial
information to defraud others and steal money.” (emphasis added).
 UNITED STATES V . PETRI 17

Because the arguments Petri raised at sentencing did not
contradict any factual assertion in the presentence report, they
did not invoke the district court’s fact-finding responsibility
under Rule 32.2

III

Lastly, we must consider Petri’s appeal of the district
court’s explanation of the sentence. We hold that the district
court adequately explained the reasons for fashioning its
sentence. The law, specifically 18 U.S.C. § 3553, requires no
more.

A sentencing court must consider the sentences suggested
by the parties after determining the applicable Guidelines
range, and under § 3553(c), it must decide if the § 3553(a)
factors support the suggested sentence. Carty, 520 F.3d at
991. Once the district court selects its sentence, it must give
an explanation that “communicates that the parties’
arguments have been heard, and that a reasoned decision has
been made.” Id. at 992.

The “district court need not tick off” each factor, but
“when a party raises a specific, nonfrivolous argument
tethered to a relevant § 3553(a) factor in support of a

2
Our recent decision in United States v. Doe, 705 F.3d 1134 (9th Cir.
2013), is consistent with our analysis. In Doe, we reasserted that “legal
objections do not require explicit findings.” Id. at 1155 n.12. In Doe, the
defendant’s objection disputed facts “from the PSR,” an allegation of
factual inaccuracy to which Rule 32(i)(B)(3) certainly applies. Id. The
district court’s refusal to resolve that dispute violated the rule— one of a
plethora of the district court’s missteps at sentencing that led us to find
plain error. Id. at 1156. Petri, though, makes no allegation of any factual
inaccuracy in his PSR.
18 UNITED STATES V . PETRI

requested sentence, then the judge should normally explain
why he accepts or rejects the party’s position.” Id. at 992–93.
Petri argues that because the district court failed to address
whether he was manipulated by “Sorin” and whether he made
a significant profit from the criminal scheme, the court’s
explanation did not suffice. We disagree.

Petri asks for more than the district court must provide.
In United States v. Rangel, 697 F.3d 795 (9th Cir. 2012), we
considered a similar claim that even though the district court
addressed the defendant’s arguments, it did not do so in
sufficient detail. Id. at 806. We held that “[c]ontext is
important, and it is often unnecessary for the district court to
provide a lengthy explanation and directly address each and
every one of the defendant’s arguments.” Id. The district
court’s ruling was sufficiently specific to satisfy its
obligations under our precedent. Id.

The court adequately addressed Petri’s argument that he
did not play a significant role in the offense—that he was
merely a foot soldier in the scheme and not the ringleader.
The assertions related to “Sorin” and Petri’s illicit proceeds
were part of this argument. The district court’s explanation
demonstrated that it had considered Petri’s argument, and the
court even reduced the sentence in light of it: “[W]hile I am
not going to grant him a minor role adjustment, I take the role
into account in saying that it justifies a somewhat lower
sentence than the guidelines would call for.”

Petri cannot expect the district court to detail its
evaluation of every assertion made to support his argument
during sentencing. See id.; United States v. Carter, 560 F.3d
1107, 1119 (9th Cir. 2009) (“[T]he district court here had no
obligation to address and resolve each of Carter’s arguments
 UNITED STATES V . PETRI 19

on the record.”). This is particularly so where there was no
effort made by the defense to bolster the argument with
admissible evidence at sentencing. The district court’s
explanation adequately discharged its duty under § 3553 and
our precedent.

IV

Petri’s challenges to his reduced sentence ultimately ask
us to impose nonexistent requirements on the district court at
sentencing. Rule 32(i)(3)(B) requires a district court to
address only unresolved factual objections to the presentence
report, and Petri failed to dispute any fact in the report.
Similarly, when explaining a sentence, the district court need
not address every assertion made within every argument
advanced before the court during sentencing.

The district court properly considered the presentence
report and the parties’ arguments and then adequately
explained its reasonable and generous resolution imposing a
below Guidelines sentence. The law requires no more.

AFFIRMED.