United States v. George M. Parrott

WALLACE, Circuit Judge,

concurring and dissenting.

I concur with the majority’s discussion of the amount of the tax loss and concur in the result only on the “criminal activity” sentence enhancement, but I must respectfully dissent on the reversal of the sentence enhancement for obstruction of justice.

I

I agree with the majority that any error under Rule 32 in the context of the “criminal activity” enhancement is harmless. I disagree with the majority that there is any error at all.

The majority correctly states that Parrott objected to an enhancement pursuant to section 2T1.3(b)(l) because “there has been no finding by any court of competent jurisdiction that a crime has occurred, nor has a charge or indictment of a crime been alleged.” The district court responded to that objection and made a specific finding that Parrott violated Tennessee Code Annotated § 39-14-103.

The majority now holds that this finding was insufficient because, on appeal, Parrott argues that he lacked intent. Parrott did not challenge the finding or enhancement on this basis in the district court. If the majority is correct, to avoid reversal the district court would have to make findings on every subis-sue, whether or not it was specifically raised by the defendant. This cannot be the law. I would hold the intent issue was waived by failing to raise it before the district court.

The majority also faults the district court for “simply adopting]” the presentence report. It is true that “a court faced with a dispute over sentencing factors [is prohibited] from adopting the factual findings of the presentence report without making factual determinations of its own.” United States v. Monus, 128 F.3d 376, 396 (6th Cir.1997). Unlike the district court in Monus, which failed to address “the defendant’s specific factual objections to the methods of calculation” in the presentence report, id. at 397, the district court here directly addressed and made findings on the objections raised by the defendant. It did not make a blanket acceptance of all the findings of the presentence report, but specifically addressed all controverted issues.

The majority faults the district court for not making “independent” findings. Independent factual findings, however, only mean *637findings based on an independent review of the evidence, not findings based on evidence independent from the presentence report. If a court could never rely on the evidence in the presentenee report to make factual findings, then the court would always have to have an evidentiary hearing whenever facts are challenged. Rule 32, however, makes evidentiary hearings on objections to the pre-sentence report discretionary: “The court may, in its discretion, permit the parties to introduce testimony or other evidence on the objections.” Fed.R.Crim.P. 32(c)(1); see also Fed.R.Crim.P. 32(b)(6)(D) (“Except for any unresolved objection under subdivision (b)(6)(B), the court may, at the hearing, accept the presentence report as its findings of fact.”).

This court demands “literal compliance” with Rule 32(e)(1), but such “literal compliance” only requires that the district court examine the evidence on controverted issues and “make either a finding on the allegation or a determination that no finding is necessary.” United States v. Tackett, 113 F.3d 603, 613 (6th Cir.1997) (quoting Fed.R.Crim.P. 32(c)(1)), cert. denied, — U.S. -, 118 S.Ct. 879, 139 L.Ed.2d 868 (1998). The district court here made a finding on the controverted matter — this should satisfy even the most literal reading of Rule 32(c)(1).

II

The majority’s analysis of the obstruction of justice enhancement fails for the same reasons discussed in reference to the “criminal activity” enhancement. But here, the majority’s mistake is compounded because the majority holds there was no harmless error. I conclude that not only is the majority’s interpretation of the “error” incorrect, but any “error” on the obstruction of justice enhancement is harmless for the same reasons as the “error” on the “criminal activity” enhancement is harmless.

Parrott objected to a proposed enhancement under U.S.S.G. § 3C1.1 for obstruction of justice because, according to Parrott, production of old false documentation is insufficient; that is, new false documentation is required to create an obstruction of justice. At the sentencing hearing, Parrott’s counsel also attempted to argue that the documents submitted were not false. The district court disagreed and made findings that the documents submitted were false. This was his objection before the district court. The district court was not requested to make any other finding.

The majority assert that Parrott “inarticulately” raised another argument: “that he submitted the documents not in an effort to impede the investigation, but in order to cooperate.” I do not believe this argument was raised. The majority cites three pages of the trial transcript, but that oblique colloquy ends with the following:

THE COURT: In your view it is not false, whatever was handed over was not false?
I want to make sure I understand your argument.
MR. WILLIAMS: That’s correct. It is always our position that we didn’t give them false documents.

Nor have I found where the precise issue of an effort to cooperate was raised in Par-rott’s opening brief to this court. His argument is difficult to follow because he mixes the criminal activity issue with the obstruction of justice issue. But that aside, he still argues the documents were not false and that having submitted the same documents earlier to a civil investigation, resubmitting them now cannot be a willful obstruction.

Thus, the district court was not required to guess what additional arguments Parrott would articulate on appeal and to make findings on those issues. Rule 32(c)(1) only requires findings on controverted matters. Nor are we required to review arguments not raised in his opening brief.

Even if the district court did err in not making the clairvoyant findings on intent the majority opinion would require, such an error would be harmless here. In his plea hearing, Parrott agreed with Agent Sinclair’s statement that Parrott misappropriated funds. Establishing misappropriation was a vital part of the plea hearing — -if the money had merely been a loan, as Parrott suggested in his sentencing hearing that he could show “if the court let [him] withdraw his plea,” then there would have been no crime in failing to pay taxes on the “borrowed” money. But Parrott agreed that he misappropriated funds and evaded federal income taxes and is now bound by his plea agreement.

*638Because Parrott was misappropriating money from the Lindahls, not borrowing it, Parrott must have known that the deposit analysis summaries he provided, which, according to Parrott, listed the money taken from the Lindahls’ accounts as loans, were false. Submitting documents one knows are false to a government investigation should easily qualify as “willfully ... attempting] to obstruct or impede[ ] the administration of justice.” U.S.S.G. § 3C1.1.

The majority suggests that “[t]he proof does not preclude the possibility that Parrott submitted the documents in an effort to cooperate with investigators.” Providing documents one knows to be false and to cover up a crime is, in my judgment, a strange way to “cooperate” with an investigation. I believe that Parrott’s actions provide “at least a minimal showing by the government” that Par-rott’s production of documents “was done with the purpose of interfering with investigation or prosecution of the crime.” United States v. Perry, 991 F.2d 304, 312 (6th Cir.1993); see U.S.S.G. § 3C1.1, cmt. 3(c) (applying the sentence enhancement to “producing or attempting to produce a false ... document”). Any ei'ror, and there is none, was harmless.

I would affirm.