United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT June 7, 2005
_____________________
Charles R. Fulbruge III
04-10136 Clerk
_____________________
UNITED STATES OF AMERICA
Plaintiff - Appellee
v.
FRANKLIN DELANO INMAN
Defendant - Appellant
___________________
Appeal from the United States District Court
for the Northern District of Texas
___________________
Before GARWOOD, BENAVIDES, and STEWART, Circuit Judges.
BENAVIDES, Circuit Judge:
Appellant Franklin Delano Inman appeals his conviction and
sentence for wire fraud under 18 U.S.C. § 1343 and access device
fraud under 18 U.S.C. § 1029(a)(2). As discussed below, we
affirm Inman’s conviction and prison sentence but remand the
restitution portion of Inman’s sentence for modification.
I. Background
From April 1997 through March 2001, Inman worked as a
computer system administrator in the information technology
(“IT”) department of Corning Systems (“Corning”), a wholesale
business that manufactures equipment for telephones. During that
time, Jean Maddox (“Maddox”) worked in Corning’s IT department as
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a leasing administrator. Her duties included purchasing computer
parts for employees in the company. Corning issued to Maddox a
Wachovia VISA credit card, which Maddox, Inman, and other IT
employees were authorized to use for company purchases, but not
for personal purchases.
During his employment with Corning, Inman repeatedly used
the VISA card to make purchases from a company named Cutting Edge
Technologies (“Cutting Edge”). Cutting Edge was a shell company
(an entity that sold no product or service) that Inman had
started. The shell company was able to make phantom credit card
sales through a merchant account set up in October, 1997, with
Nova Information Systems, a credit card processing company.
Proceeds from the phantom purchases were deposited by Nova into a
Bank One account that Inman had opened for “Inman Consulting,
Incorporated” in September 1997.
Maddox became suspicious of Inman in early 2001 because of
the numerous purchases from Cutting Edge that appeared on the
VISA statement and because she never saw any of the items Inman
allegedly purchased. After Maddox reported the suspicious
activity to the IT Department Manager, it was discovered that
Cutting Edge did not really exist. When asked to explain the
purchases, Inman told the IT Department Manager that he would
explain the transactions after he returned to work from vacation.
However, Inman never returned.
Subsequently, a jury convicted Inman on ten counts of wire
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fraud in violation of 18 U.S.C. § 1343 and one count of access
device fraud in violation of 18 U.S.C. § 1029(a)(2). The
district court sentenced Inman to 21 months of imprisonment, a
3-year term of supervised release, a $1,100 mandatory special
assessment, and $135,283.11 in restitution.
II. Discussion
Inman challenges his conviction, restitution order, and
sentence enhancements. First, he argues that there was
insufficient evidence to uphold his conviction for access device
fraud under 18 U.S.C. §1029(a)(2). Second, he contends that the
trial court’s restitution order was improper because it exceeded
the temporal scope of the indictment. Third, Inman argues that
his prison sentence is unconstitutional because the district
court enhanced his sentence based on facts not found by a jury.
We discuss each argument in turn.
A. Insufficiency of Evidence
Inman first argues that there is insufficient evidence to
sustain his conviction under 18 U.S.C. § 1029(a)(2) because one
of the statutory elements of that provision, the use of an
unauthorized access device, was not proved at trial. Thus, he
contends that the district court’s denial of his timely motion
for a new trial was erroneous.
We review the evidence to determine whether any reasonable
trier of fact could have found that the evidence established
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guilt beyond a reasonable doubt. United States v. Martinez, 975
F.2d 159, 160-61 (5th Cir. 1992). We view the evidence in the
light most favorable to the government, drawing all reasonable
inferences from the evidence in favor of the jury’s verdict. Id.
at 161; United States v. Shabazz, 993 F.2d 431, 441 (5th Cir.
1993).
Section 1029(a)(2) provides that a person who “knowingly and
with intent to defraud traffics in or uses one or more
unauthorized access devices during any one-year period, and by
such conduct obtains anything of value aggregating $1,000 or more
during that period” is subject to criminal penalties. 18 U.S.C. §
1029(a)(2).
According to Inman, the evidence at trial showed that the
credit card was an authorized access device, rather than an
unauthorized one, and that Corning was aware of the charges he
made on the credit card. Inman acknowledges that arguably he may
have exceeded his authority to charge on the card, but he asserts
that such action does not violate § 1029(a)(2). We disagree.
Section 1029(e)(3) defines an “unauthorized access device”
as “any access device that is lost, stolen, expired, revoked,
canceled, or obtained with intent to defraud.” 18 U.S.C. §
1029(e)(3). Because neither party claims that the VISA credit
card used by Inman was stolen, expired, revoked, or canceled, the
relevant inquiry here is whether the card was “obtained with
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intent to defraud.”
The evidence at trial showing that Inman intended to defraud
Corning when he obtained the card from Maddox was substantial.
The government presented evidence that before obtaining the VISA
card, Inman had already created the fraudulent company, Cutting
Edge, from which he would later falsely purchase products;
acquired a merchant account for the company; and opened a
recipient bank account for the transfer of the credit card
transaction proceeds. Thus, a jury would have sufficient evidence
to find that Inman obtained the card with intent to fraudulently
collect money from the VISA card issuer at Corning's expense.
Moreover, while Inman had authorization to use the VISA card
for company purchases, he was unauthorized to use the card for
personal purchases. Thus, Inman directly violated Corning’s
mandate against using the card for personal purchases when he
fraudulently made phantom purchases from Cutting Edge. Such
misuse of the card served as further evidence of an unauthorized
access device. See H.R. Rep. 98-894, *14, 1984 U.S.C.C.A.N. 2689,
**3700, 3703 (describing an unauthorized access device as a
“genuine access device[] being used without authority” and
“genuine but misused” in distinguishing between “counterfeit
access device” as defined in § 1029(E)(2) and an “unauthorized
access device” in § 1029 (E)(3)).
B. Restitution Order
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Inman next argues that the district court erred in ordering
restitution in the amount of $ 135,283.11 because the order
exceeds the amount of loss incurred during the temporal scope of
the indictment. The indictment charged Inman with actions
occurring from March, 2000, to February, 2001. The amount of loss
resulting from actions during that time period totaled
$64,501.97. However, the district court calculated Inman’s
restitution at $135,283.11 based on actions occurring between
November 6, 1997, and February 22, 2001.
Because Inman did not raise his challenge to the restitution
order below, we review for plain error. See United States v.
Olano, 507 U.S. 725, 731-32 (1993). Thus, Inman must show that
(1) there is an error, (2) the error is plain, and (3)the error
affects substantial rights. Id. at 732. When all three of these
requirements are met, we will exercise our discretion to correct
the error if it “seriously affect[s] the fairness, integrity or
public reputation of judicial proceedings.” Id. at 734 (quoting
United States v. Young, 470 U.S. 1, 15 (1985)).
Here, Inman has shown that there is an error that is plain.
A defendant sentenced under the Mandatory Victim Restitution Act
(“MVRA”) is only responsible for paying restitution for the
conduct underlying the offense for which he was convicted. United
States v. Mancillas, 172 F.3d 341, 343 (5th Cir. 1999). “[W]here
a fraudulent scheme is an element of the conviction, the court
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may award restitution for ‘actions pursuant to that scheme.’”
United States v. Cothran, 302 F.3d 279, 289 (5th Cir. 2002)
(quoting United States v. Stouffer, 986 F.2d 916, 928 (5th Cir.
1993)). However, the restitution for the underlying scheme to
defraud is limited to the specific temporal scope of the
indictment. See United States v. Pepper, 51 F.3d 469, 473 (5th
Cir. 1995) (affirming district court’s restitution order based on
fraudulent scheme where indictment gave dates during which the
scheme occurred and described the actions of which the scheme to
defraud consisted); Stouffer, 986 F.2d at 928-29 (affirming
district court’s inclusion of all losses caused by a scheme to
defraud where “the scheme to defraud was specifically defined in
the indictment–-i.e., the indictment described in detail the
duration of [the scheme] and the methods used”). Here, Inman’s
restitution order under the MVRA was based, in part, on
transactions that were not alleged in the indictment and occurred
over two years before the specified temporal scope of the
indictment. Thus, the district court plainly erred.
The third prong of the plain error test is also met. The
restitution order affected Inman’s substantial rights because the
outcome of the district court proceedings would have been
different if the error had not occurred. See Olano, 507 U.S. at
734. Had the district court based the restitution order on the
temporal scope provided in the indictment, the restitution order
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could not have exceeded $64,501.97. This variance of over
$70,000 merits correction.
C. Constitutionality of Sentence Enhancements
Finally, Inman argues that his sentence is unconstitutional
under United States v. Booker, --- U.S. ----, 125 S.Ct. 738
(2005), because his sentence was based on facts neither admitted
by Inman nor found by a jury.
Under the United States Sentencing Guidelines, Inman’s base-
offense level was calculated at 6. This base-offense level,
given Inman’s criminal history category, would have yielded a
term of imprisonment of 0 to 6 months. However, the district
court applied a 2-level enhancement to Inman’s offense level
pursuant to U.S.S.G. § 2F1.1(b)(2) for engaging in more than
minimal planning and a 7-level enhancement under U.S.S.G. §
2F1.1(b)(1)(H) for a total loss to victims above $120,000. Under
the guidelines, the resulting total offense level of 15 resulted
in an imprisonment range of 18 to 24 months. The district court
sentenced Inman to 21 months of imprisonment. During the
pendency of this appeal, the U.S. Supreme Court issued its
opinion in Booker, 125 S.Ct. 738, rendering the Guidelines,
including the provisions for enhancing a defendant’s sentence
based on facts not found by the jury, advisory rather than
mandatory. Inman argues that under the holding of Booker, his
prison sentence is unconstitutional. Because Inman raises his
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challenge to his prison sentence for the first time on appeal, we
review for plain error. United States v. Mares, 402 F.3d 511, 520
(5th Cir. 2005); Olano, 507 U.S. at 731-32.
The first prong of the plain error test is met here. Inman’s
enhancements were based on the amount of planning in which Inman
engaged and a total loss of over $120,000, neither of which were
charged in the indictment or found by a jury. Thus, Inman’s
sentence was enhanced based on facts found by the judge under a
mandatory Guidelines regime in violation of the Sixth Amendment.
See Mares, 402 F.3d 520-21.
The error is also plain in that it is clear at the time of
our review. See id. at 521; Johnson v. United States, 520 U.S.
461, 468 (1997) (holding that error is plain for purposes of
plain error review as long as the law regarding the issue is
settled at the time of appellate consideration).
However, the third prong of the plain error inquiry, which
requires the appellant to show that the error affected
substantial rights, is not met here. Inman has pointed to no
evidence that the sentencing judge would have imposed a different
sentence under an advisory scheme rather than a mandatory one.
See Mares, 402 F.3d at 521. Neither has our review of the record
revealed any such evidence. See United States v. Villanueva,
—F.3d ----, 2005 WL 958221, *7 (5th Cir. Apr. 27 2005) (finding
no effect on substantial rights where “there is no indication in
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the record . . . that gives us any clue” as to what the
sentencing judge would have done absent a mandatory sentencing
scheme); Mares, 402 F.3d at 521 (same). To the contrary, the
sentencing judge expressed his belief that the sentence was
appropriate for Inman’s offense in stating, “A sentence at the
middle of the guideline range meets the Court’s sentencing
objectives of punishment and deterrence.” We thus find no plain
error in Inman’s sentence of imprisonment.
III. Conclusion
For the above stated reasons, we AFFIRM Inman’s conviction
and sentence, with the exception of the restitution order, which
we REMAND to the district court for modification consistent with
this opinion.
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