REVISED - JUNE 30, 1998
UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
____________________________
No. 96-50352
____________________________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
DAVID BRACE,
Defendant-Appellant.
________________________________________________________________
Appeal from the United States District Court
for the Western District of Texas
_________________________________________________________________
June 24, 1998
Before POLITZ, Chief Judge, KING, JOLLY, HIGGINBOTHAM, DAVIS,
JONES, SMITH, DUHÉ, WIENER, BARKSDALE, EMILIO M. GARZA, DeMOSS,
BENAVIDES, STEWART, PARKER, and DENNIS, Circuit Judges.1
RHESA HAWKINS BARKSDALE, Circuit Judge:
We granted rehearing en banc to consider whether, in order to
rebut the entrapment defense raised by David Brace, the Government
was required to prove “positional predisposition” on his part, a
new requirement utilized in another circuit and by the panel; but,
1
Judge Jones concurs only in the result. Judge Smith
joins in parts I, II.A.2, II.B., and II.C and concurs in the
result.
we conclude that we cannot address that subissue because it was
neither preserved in district court nor even raised, for the first
time, on appeal. Instead, at issue is simply whether, under our
existing precedent, Brace was entrapped as a matter of law.
A jury convicted Brace and Shannon Knox of money laundering.
On appeal, the panel affirmed as to Knox; but, it reversed Brace’s
convictions, finding entrapment as a matter of law, because the
Government failed to prove “positional predisposition” on the part
of Brace. In taking this case en banc, we severed Knox, with the
panel opinion as to him remaining unaffected; of course, as to
Brace, we vacated that portion of the opinion as it related to him.
United States v. Knox, 112 F.3d 802 (5th Cir.), severed and granted
rehearing en banc by 120 F.3d 42 (5th Cir.), cert. denied as to
Knox, ___ U.S. ___, 118 S. Ct. 616 (1997). Upon rehearing en banc
as to Brace, we AFFIRM.
I.
Brace was the pastor of Faith Metro Church in Wichita, Kansas.
In 1991, the church began construction on an 80,000 square foot
building, financed through bonds, which required monthly payments
of approximately $65,000. The church also owned and operated five,
largely unprofitable, radio stations in the Wichita area, which had
required an investment of approximately $500,000 over three years.
In 1993, due to financial difficulties arising from these
2
obligations, the church issued bonds and sought short-term,
unsecured loans.
Brace met in May 1994 with Mike Clark, a financial consultant
from Houston, Texas, and Clark’s assistant, Knox. During this
meeting, Brace decided to pursue a limited private offering in the
amount of $10.8 million to retire the church’s outstanding debt.
The church trustees approved the plan and the offering began in
September 1994; but, there were few responses and no money was
raised. Shortly after the offering began, Knox met Roy Clarkston,
a financier, in October or November 1994; and Knox gave Clarkston
a copy of the private offering prospectus. In February 1995,
Clarkston told Knox that he knew of some “South American investors”
who might be interested in Faith Metro Church.
Concerning those “investors”, while Brace had been attempting
unsuccessfully to secure financing for his church in Kansas,
undercover federal agents were conducting a money laundering
investigation in San Antonio, Texas. Beginning in October 1994,
around the time that Knox first met with Clarkston, Drug
Enforcement Administration Special Agent Gonzalez met several times
with Clarkston, who was suspected of money laundering. Agent
Gonzalez identified himself as a Columbian narcotics trafficker
seeking to launder money from cocaine sales.
In early March 1995, Clarkston contacted United States Customs
Special Agent Cisneros, who was operating undercover as the
3
“accountant” for Agent Gonzalez, and informed Agent Cisneros that
he had a “major big time guy” from “a church group” who was “very
interested” in talking to Cisneros and wanted to “close” the deal
the following weekend. (During the investigation, conversations
between the Agents and Brace, Knox, and Clarkston were recorded, by
video and/or audio, with the exception of the two following 17
March meetings.)
On 17 March 1995, Agents Gonzalez and Cisneros met with
Clarkston at a San Antonio hotel. Clarkston stated that he knew a
minister who was interested in laundering the cocaine money, and
that the minister’s financial advisor was in town and eager to meet
with them. At this time, the Agents had no knowledge of the
identity of either Brace or Knox. Agent Gonzalez told Clarkston
that he did not want any innocent people involved in the operation
and asked if the minister (Brace) knew Gonzalez was a cocaine
trafficker looking to launder cocaine proceeds. Clarkston stated
that the minister and his financial advisor knew and did not care.
That same afternoon, Clarkston brought Knox to the hotel to
meet the Agents. Knox told them that he was the representative for
the minister and wanted to negotiate a deal. The Agents told Knox,
early in the conversation, that Agent Gonzalez was a Colombian drug
trafficker; that Agent Cisneros was the accountant for the drug
organization; and that the deal involved laundering money from
4
cocaine sales. Knox responded that he and the minister knew this
and were not concerned about the money’s source.
Knox explained that Brace’s nonprofit Kansas corporation, New
Life Fellowship, Inc., d/b/a Faith Metro Church, could launder the
money; and, that the transaction would not arouse suspicion,
because a minister was involved. Knox provided a copy of the
private offering prospectus for Faith Metro Church. Agent Gonzalez
told Knox that the Agents needed to meet with Brace to ensure that
he understood that they were drug traffickers seeking to launder
cocaine proceeds. Knox stated that Brace would gladly meet with
them and could do so within 12 hours.
Over the next few days, Clarkston left telephone messages with
Agent Cisneros that Knox and Brace were in San Antonio and ready to
meet with the undercover Agents. On 24 March 1995, Agents Gonzalez
and Cisneros met Brace, along with Clarkston and Knox, in a San
Antonio hotel room. Gonzalez stated that he was authorized to
“invest” up to $10 million, but that Knox and Brace would first
need to transfer some test amounts, around $100,000.
Brace quickly agreed, assuring that he would do whatever was
necessary in order to accomplish his goal and satisfy Gonzalez’s
organization. The Agents then stated that they needed to “go into
the delicate issues”, so that “there [were] no misunderstandings”
or “confusion as to where the money [was] coming from”. During the
meeting, Agent Cisneros stated: “[Agent Gonzalez] plainly puts it
5
... that the money is from the sale of cocaine trafficking. That
it is narcotics money. ... he is asking you to launder money”.
Brace responded: “I have monies that I know that come to the
church. I don’t have a questionnaire ... where these monies come
from.” Brace told the Agent that he knew that he had received
funds “from sources that, uh, would be questionable”. Brace then
stated: “I prayed to God ... because I wanted to know if I was
supposed to do this”. According to Brace, “God said that ... He
helped put this []together.” Finally, Brace told the Agents: “I
appreciate the fact that you want to be very straight forward and
up front with me. ... but, uh, that does not concern me, really.”
Brace and Knox stated that they were surprised, however, by
the $10 million figure, because they had originally been seeking
only $3 million. Brace and Knox stated that they would need some
time to figure out how long it would take to transfer and repay
this larger amount. Agent Gonzalez explained that he would give
various denominations of cash to Knox and Brace; and they responded
that they had already discussed those matters, although the Agents
had never before met with Brace. Gonzalez agreed to pay Brace,
Knox, and Clarkston six percent of the transferred amount. Brace
assured the Agents that he was ready to transfer the test money,
but Agent Gonzalez told him to have patience and wait.
A month later, on 24 April 1995, Knox telephoned Agent
Cisneros, informing him that Brace was in San Antonio and ready to
6
take the first test money. Knox stated also that he and Brace had
already “contrived a system” to quickly deposit and transfer the
first $100,000.
Two days later, Agent Cisneros met with Brace and Clarkston in
San Antonio. At the beginning of the meeting, Agent Cisneros told
Brace that the Colombian organization had just “crossed” three tons
of cocaine into the United States, and explained, “[s]o ... now
there’s a lot of profit”. Agent Cisneros gave Brace the account
number for an undercover account in a London bank. Brace stated he
would wire the $100,000 from his Wichita bank, but suggested
transferring the money instead to a domestic bank, because it would
clear faster and because Faith Metro Church had not previously
transferred money to a foreign bank. Agent Cisneros told Brace
that “the Colombians” probably would not change the destination
account; but, that all other details of the transaction were left
to Brace.
Brace also discussed how the $10 million would be repaid: he
planned to make payments of $50,000 per month for the first two
years; of $100,000 per month for the next two years; and then pay
the balance. During this meeting, undercover Agents Gallman and
Pineda gave $100,000 to Brace. Agent Cisneros offered Brace two
opportunities to withdraw from the transaction, but Brace declined
both times.
7
Brace enlisted Mark Raccuglia, a staff member at Faith Metro
Church, to help launder the money, giving him specific instructions
to obtain cashier’s checks with different remitters from certain
banks and to deposit them in specific accounts. And, Brace
instructed Raccuglia to use cashier’s checks in amounts less than
$3000 each, in order to avoid the internal records policy at the
banks.
Brace successfully transferred this first test amount to the
London account, and told Cisneros that he was ready to transfer the
next test amount. Knox telephoned Agent Cisneros on 3 May and told
him that Brace received $3000 as his share for the first test
transfer.
Two days later, on 5 May, Agents Cisneros and Gallman met with
Brace in San Antonio to discuss the second test transfer. Brace
was told to make a transfer to a domestic account, ostensibly Agent
Gallman’s. Brace said that there were no difficulties running funds
through his church’s accounts, because they were listed as
offerings or donations. Brace also suggested that, to avoid
suspicion, they not transfer the same amount again.
Brace told Agent Gallman that he would account for the money
transfers in installments, carried on his books as a loan, and
would assimilate it over time through church offerings. And, Brace
explained that, because Faith Metro Church was a 501(c)(3)
corporation, the books were not public records. Brace informed the
8
Agents that he would explain the next test transfer as an advance
payment on interest for the large loan he would soon be receiving.
Brace indicated that his involvement in this operation was
“supposed to happen” and that
the fact is that I’m not ... getting a whole
lot of ... respect. ... I almost have to go to
[] bankers and [] show them that ... I do not
need the money in order for them to loan it to
me. And then [], frankly [], ... I’m just
tired of being somebody’s whipping dog.
After receiving the second $100,000 test amount, Brace
commented to the Agents, “I have a feeling that neither one of you,
have ever come across a pastor like me”. Brace confirmed that he
would again receive $3000 as his commission. (Brace apparently had
excluded Clarkston from this meeting because of potential
disagreement over how to split the six percent commission.)
When Brace returned to Kansas with the second $100,000, he
directed Raccuglia to research cash reporting requirements.
Raccuglia told Brace that his research indicated that Brace was
money laundering, but Brace assured him this was not true. Brace,
again with Raccuglia’s assistance, successfully transferred the
money from the church’s Wichita bank; this time, to a domestic
bank.
After the second test transfer, Knox told Agent Cisneros that
Brace had 11 accounts set up through which he could move $4 million
in 30 days. Knox said that Brace was willing to make another test
transfer and that “ten million dollars is just the tip of the
9
iceberg that we can put through [Faith Metro Church]. It’s turning
into a washing machine real fast”. In a subsequent telephone
conversation between Agent Cisneros and Brace, Brace reiterated
Knox’s information about the 11 accounts and said that he had
acquired a large safe in which to store the money.
On 12 May, Agent Cisneros met with Brace, Knox, and Clarkston
and delivered the last test amount, this time for $150,000. Agent
Cisneros stated that “the Colombians” would soon start with $5
million of the “big money”, which would include a bonus for Brace.
Brace responded that he had someone researching “what raises
eyebrows overseas”, and that he could transfer the test amount
using accounts at three separate banks. Agent Cisneros emphasized
that the Colombians were dangerous dope dealers.
Brace and Knox successfully transferred the third test amount.
Brace told Raccuglia that Knox handled the transfer, because Brace
“wanted [Knox] to be as involved in it as he was”.
On 18 May, Knox telephoned Agent Cisneros and told him that he
and Brace were in San Antonio and ready to do the big deal (even
though no arrangements had been made by Agent Cisneros for it to
happen then). Brace telephoned Agent Cisneros later and apologized
for appearing too anxious. Agent Cisneros testified that he
delayed further action, repeatedly emphasizing that the Colombians
were ruthless drug dealers, so that Brace and Knox would have an
opportunity to “cool down” and withdraw. During this “cool down”
10
period, Brace repeatedly tried to contact Agent Cisneros by
telephone.
On 16 June, Agent Cisneros had a telephone conversation with
Brace and Knox. Knox said that he and Brace, after working
together for 48 hours, had the necessary equipment to transfer the
money. Brace added that he had several suitcases of different
sizes and asked how the money was packaged. Agent Cisneros
responded that the Colombians were thinking about waiting awhile,
to which Brace replied:
I’m not goin’ anyplace.
....
Uh, I’m not ancy. Uh, you know, I’m ready
just like you to finish it. Uh, I’ve got my
things in place at home. Uh, I’m prepared.
Uh, in fact, I’m [] probably over-conservative
and over-killed at home as far as protection
and as far as, uh, making sure of safety and
[] moving things....
On 21 June, Brace and Knox met with undercover Agents in a
parking lot in San Antonio and accepted three canvas bags filled
with paper clippings approximating the weight of $10 million in
cash. Brace and Knox left the parking lot in Brace’s car with the
bags, intending to drive to Kansas, but were arrested immediately.
The arresting Agents found a .380 caliber semi-automatic pistol in
the back seat of Brace’s car, along with a fully-loaded clip of
ammunition. Brace had bought the pistol the day before his arrest,
11
because he thought that “the Colombians” expected him to protect
the money.
Brace and Knox signed written statements admitting to their
involvement in the money laundering. Each was charged with one
count of conspiring to launder money and one count of laundering
money; Brace, also on two other money laundering counts. Clarkston
was also indicted; he pleaded guilty.
In December 1995, Brace and Knox were tried jointly; their
sole defense was entrapment. A jury convicted them on all counts,
and Brace was sentenced to 175 months imprisonment and fined
$10,000.
Knox’s convictions and sentence were affirmed by a panel of
our court, Knox, 112 F.3d at 810-14; but, it reversed Brace’s
convictions, holding that, because the Government failed to prove
the element of “positional predisposition” beyond a reasonable
doubt, Brace was entrapped as a matter of law. Id. at 806-10.
Subsequently, our court severed the affirmance with respect to
Knox; but, as for Brace, we vacated that portion of the panel
opinion pertaining to his convictions and granted rehearing en
banc. Knox, 120 F.3d at 43.
II.
The issues presented by Brace on appeal are that the district
court committed reversible error: (1) by failing to hold he was
entrapped as a matter of law; (2) by using our pattern jury
12
instruction on entrapment; and (3) by incorrectly calculating his
sentence. Our reason for rehearing was to address, concerning the
entrapment issue raised by Brace, the panel’s adoption of a new
“positional predisposition” requirement.
A.
The Supreme Court first recognized the entrapment defense in
Sorrells v. United States, 287 U.S. 435 (1932). It described
entrapment as “when the criminal design originates with the
officials of the government, and they implant in the mind of an
innocent person the disposition to commit the alleged offense and
induce its commission in order that they may prosecute”. Id. at
442 (emphasis added).
[T]he defense of entrapment is not simply that
the particular act was committed at the
instance of government officials. ... The
predisposition and criminal design of the
defendant are relevant. But the issues raised
and the evidence adduced must be pertinent to
the controlling question whether the defendant
is a person otherwise innocent whom the
government is seeking to punish for an alleged
offense which is the product of the creative
activity of its own officials.
Id. at 451 (emphasis added).
The Court found entrapment as a matter of law in Sherman v.
United States, 356 U.S. 369 (1958), when a drug addict repeatedly
rejected offers from an undercover officer to buy drugs, including
appeals of sympathy for the undercover officer’s needs and
inducements for the addict to return to his drug habit. “To
13
determine whether entrapment has been established, a line must be
drawn between the trap for the unwary innocent and the trap for the
unwary criminal”. Id. at 372.
In performing this determination, the Court instructed that
the defendant should be subjected to “an ‘appropriate and searching
inquiry into his own conduct and predisposition’ as bearing on his
claim of innocence”. Id. at 373 (quoting Sorrels, 287 U.S. at
451). Therefore, Sherman focused on the accused, not the
undercover officer, and found that he was not predisposed because,
inter alia, there was a lack of evidence that he was currently in
the drug trade, no drugs were found in his residence, he did not
appear to make a profit on the sales, and he was trying to overcome
his drug habit. Id. at 375-76.
United States v. Russell, 411 U.S. 423 (1973), relying on
Sorrells and Sherman, keyed on the defendant’s subjective intent,
rather than the undercover officer’s objective conduct: “It is only
when the Government’s deception actually implants the criminal
design in the mind of the defendant that the defense of entrapment
comes into play”. Id. at 436 (emphasis added). This test would
negate an entrapment defense for defendants who are ready to commit
a crime, even though they were subjected to inducements that “might
have seduced a hypothetical individual who was not so predisposed”.
Id. at 434.
14
In Hampton v. United States, 425 U.S. 484 (1976), the Court
revisited this subjective predisposition standard, holding that
“Russell definitively construed the defense of entrapment to be
focused on the question of predisposition”. Id. at 492 n.2
(Powell, J., concurring). However, only a plurality of the Court
agreed that Russell stood for the proposition that, when the
defendant’s predisposition is proven, an entrapment defense can
never be established solely on governmental misconduct. Id. at
488-89.
Mathews v. United States, 485 U.S. 58 (1988), synthesized
Court precedent on the entrapment defense:
[A] valid entrapment defense has two related
elements: government inducement of the crime,
and a lack of predisposition on the part of
the defendant to engage in the criminal
conduct. ... Predisposition, “the principal
element in the defense of entrapment,” ...
focuses upon whether the defendant was an
“unwary innocent” or, instead, an “unwary
criminal” who readily availed himself of the
opportunity to perpetrate the crime.
Id. at 63 (citations omitted).
In 1984, based upon the foregoing entrapment precedent, our
court reaffirmed the key components of the defense:
Consistent with this summary of Supreme
Court directives, our inquiry always has been
on the defendant’s predisposition, his intent
or willingness--before contact with government
agents and inducement--to commit the crimes
charged. ... The concern is thus that the
accused is not guilty, since he had no
criminal intent not implanted by the
15
government, rather than that he is guilty but
may avoid the consequences of his criminal
conduct because of the government’s undue
inducement.
United States v. Henry, 749 F.2d 203, 210 (5th Cir. 1984) (en
banc) (emphasis added).
Almost eight years later, however, in Jacobson v. United
States, 503 U.S. 540 (1992), the Court held that a defendant was
entrapped as a matter of law when officers made repeated attempts,
for two-and-a-half years, to induce him to purchase child
pornography through the mails. Due to the Government’s relentless
conduct, which included urging the defendant to take a stand
against censorship and for freedom of expression, the Court held
that rational jurors could not find, beyond a reasonable doubt,
“that petitioner possessed the requisite predisposition prior to
the Government’s investigation and that it existed independent of
the Government’s many and varied approaches to petitioner”. Id. at
553 (emphasis added).
For our purposes here, one post-Jacobson case, from another
circuit, also comes into play: United States v. Hollingsworth, 27
F.3d 1196, 1200 (7th Cir. 1994) (en banc). It interpreted Jacobson
to require evidence that the defendant was “so situated by reason
of previous training or experience or occupation or acquaintances
that it is likely that if the Government had not induced him to
commit the crime some criminal would have done so”.
16
Predisposition is not a purely mental state,
the state of being willing to swallow the
government’s bait. It has positional as well
as dispositional force. ... A public
official is in a position to take bribes; a
drug addict to deal drugs; a gun dealer to
engage in illegal gun sales. For these and
other traditional targets of stings all that
must be shown to establish predisposition and
thus defeat the defense of entrapment is
willingness to violate the law without
extraordinary inducements; ability can be
presumed. It is different when the defendant
is not in a position without the government’s
help to become involved in illegal activity.
... Such cases, illustrated by Jacobson[,]
... are rare.
Id. The Seventh Circuit found that the defendants, a farmer and an
orthodontist, were “objectively harmless”, because “[n]o real
criminal would do business with such [novices]”. Id. at 1202-03.
But see United States v. Thickstun, 110 F.3d 1394, 1397-98 (9th
Cir.) (rejecting the Hollingsworth “positional predisposition”
standard), cert. denied, ___ U.S. ___, 118 S. Ct. 305 (1997).
1.
Brace claims that he was entrapped as a matter of law. The
Government acknowledges that it induced him to launder money.
Therefore, at issue is whether the evidence was sufficient to
prove, beyond a reasonable doubt, that he was predisposed to do so.
For deciding that issue, we must first examine subissues raised by
the parties. But, in so doing, we have discovered that, as
sometimes happens when we take a case en banc, this is an instance
in which the reason for rehearing evaporated, because a “positional
17
predisposition” subissue was neither preserved in district court
nor even presented, for the first time on appeal, to the panel.
It goes without saying that we are a court of review, not of
original error. Restated, we review only those issues presented to
us; we do not craft new issues or otherwise search for them in the
record. E.g., United States v. Johnson, 718 F.2d 1317, 1325 n.23
(5th Cir. 1983) (en banc) (we will not review improper jury
instruction if neither raised in trial court nor claimed on appeal
to be error). It is for the parties, those who have a stake in the
litigation, to decide which issues they want to pursue, at trial
and on appeal. Diverse reasons underlie the choices the parties
make. Likewise, other obvious factors come into play, such as
judicial efficiency and economy, fairness to the courts and the
parties, and the public interest in litigation coming to an end
after the parties have had their fair day in court. Cf. United
States v. Atkinson, 297 U.S. 157, 159 (1936); United States v.
Olano, 507 U.S. 725, 731 (1993); United States v. Calverley, 37
F.3d 160, 162 (5th Cir. 1994) (en banc), cert. denied, 513 U.S.
1196 (1995). In short, it is not for us to decide which issues
should be presented, or to otherwise try the case for the parties.
Our role is indeed limited. Concerning our not acting as
legislators, Justice Cardozo admonished that a judge “is not a
knight-errant, roaming at will in pursuit of his own ideal of
beauty or of goodness”. CARDOZO, THE NATURE OF THE JUDICIAL PROCESS 141
18
(1921). Needless to say, the same is true regarding our not
addressing issues not presented to us.
In holding that Brace was entrapped as a matter of law, the
now-vacated Brace-portion of the panel opinion adopted the above-
discussed “positional predisposition” requirement espoused by the
en banc Seventh Circuit in Hollingsworth. Knox, 112 F.3d at 808
(vacated) (holding that “we must look not only to the defendant’s
mental state (his ‘disposition’), but also to whether the defendant
was able and likely, based on experience, training, and contacts,
to actually commit the crime (his ‘position’)”) (emphasis added).
Notwithstanding the panel’s fidelity, the problem is that, as
discussed infra, this “positional predisposition” subissue or
element was not presented by Brace either to the district court or
on appeal. And, as noted, our en banc reconsideration vacates the
panel opinion as to Brace. Knox, 120 F.3d at 42; 5th Cir. R. 41.3;
see, e.g., Leffall v. Dallas Indep. Sch. Dist., 28 F.3d 521, 529
n.2 (5th Cir. 1994). In short, the new “positional predisposition”
requirement adopted by the now-vacated Brace-portion of the panel
opinion is no more. The reasons why this requirement or element is
not at issue follow.
Our court held, just eight months after Brace’s December 1995
trial, that our pattern jury instruction on entrapment, quoted
below, reflects the holding in Jacobson, decided in 1992. United
States v. Hernandez, 92 F.3d 309, 311 (5th Cir. 1996), cert.
19
denied, ___ U.S. ___, 117 S. Ct. 1437 (1997). In fact, in the case
at hand, the panel rejected a challenge by Knox to the instruction,
citing Hernandez, without further discussion. Knox, 112 F.3d at
810 (non-vacated portion).
At trial, Brace did not object to Fifth Circuit Pattern Jury
Instruction No. 1.28. It provides in relevant part:
The defendant asserts that he was a
victim of entrapment.
Where a person has no previous intent or
purpose to violate the law, but is induced or
persuaded by law enforcement officers or their
agents to commit a crime, that person is a
victim of entrapment, and the law as a matter
of policy forbids that person’s conviction in
such a case.
On the other hand, where a person already
has the readiness and willingness to break the
law, and the mere fact that government agents
provide what appears to be a favorable
opportunity is not entrapment. For example,
it is not entrapment for a government agent to
pretend to be someone else and to offer ... to
engage in an unlawful transaction.
If, then, you should find beyond a
reasonable doubt from the evidence in the case
that, before anything at all occurred
respecting the alleged offense involved in
this case, the defendant was ready and willing
to commit a crime such as charged in the
indictment, whenever opportunity was afforded,
and that government officers ... did no more
than offer the opportunity, then you should
find that the defendant is not a victim of
entrapment.
On the other hand, if the evidence in the
case should leave you with a reasonable doubt
whether the defendant had the previous intent
or purpose to commit an offense of the
20
character charged, apart from the inducement
or persuasion of some officer ... of the
government, then it is your duty to find the
defendant not guilty.
The burden is on the government to prove
beyond a reasonable doubt that the defendant
was not entrapped.
(Emphasis added.) As stated, this instruction is a correct
statement of the holding in Jacobson.
Brace’s supplemental (en banc) brief, in responding to our en
banc court’s expressed interest in the parties addressing
“positional predisposition”, urges, for the first time, that the
“positional predisposition” element is embodied in this pattern
instruction. Specifically, he maintains that the terms “ready” and
“readiness”, as used in the instruction, equate with the “ability”
to commit a crime. (Presumably, this tardy contention is offered
to explain Brace’s failure at trial to object to the entrapment
instruction. If so, this, of course, is most inconsistent, as he
acknowledges, with his similarly belated challenge on appeal to the
pattern instruction, discussed infra, which he concedes is reviewed
only for plain error in the light of his failure to object at trial
to the instruction. This tactic is not simply “alternative
claims”; Brace, instead, “wants to have his cake and eat it too”.)
The now-vacated Brace-portion of the panel opinion also looked
to “ability”: “A defendant may have the desire to commit the crime,
but may be without any ability to do so. The defendant is able to
commit the crime only when the government steps in and provides the
21
means to do so”. Knox, 112 F.3d at 807 (vacated) (emphasis added).
But, “ready and willing” is not necessarily synonymous with “ready,
willing, and able”. Cf. Hendershot v. Amarillo Nat’l Bank, 476
S.W.2d 919, (Tex. Civ. App.--Amarillo 1972, no writ) (denying
specific performance of a contract, which requires the party
seeking performance to prove he is “ready, willing and able” to
perform, because “appellant failed to establish the essential
element of his ability to perform”) (emphasis added). (In
addition, the contention that the evidence fails to show that Brace
was able to commit the charged offenses is a dubious one. As
detailed infra, the successful completion of three test transfers
to bank accounts, both foreign and domestic, among other evidence
of Brace’s role in the money-laundering operation, appears
sufficient for the jury to find, beyond a reasonable doubt, that
Brace was more than “able” to money launder.)
In any event, it goes without saying that, when entrapment is
raised against a charged offense, the Government bears the burden
of demonstrating, beyond a reasonable doubt, that the defendant was
predisposed. E.g., United States v. Byrd, 31 F.3d 1329, 1335 (5th
Cir. 1994), cert. denied, 514 U.S. 1052 (1995). On the other hand,
the absence of entrapment is not an essential element of a charged
offense; instead, entrapment is an affirmative defense. See United
States v. Elorduy, 612 F.2d 986, 990 (5th Cir.), cert. denied, 447
22
U.S. 910 (1980). And, predisposition is generally a question of
fact for the jury. Sherman, 356 U.S. at 377.
It follows that, when entrapment is claimed, the Government
should not be required to meet its predisposition burden by
providing evidence to the jury on an unlimited number of possible
entrapment theories or elements, such as “positional
predisposition”, never raised or mentioned by the defendant by
motion, objection, or countervailing evidence. Cf. United States
v. Valencia, 645 F.2d 1158, 1176 (2d Cir.) (Van Graafeiland, J.,
concurring in part and dissenting in part) (stating that a
defendant should not be allowed to deny commission of a crime and
then, at the close of all the evidence, ask for an entrapment jury
charge, because “[d]efense counsel should not be allowed to
maneuver the Government out of introducing whatever proof it has on
the issue of defendant’s predisposition”), amended by 669 F.2d 37
(2d Cir. 1980). Therefore, it is unknown whether, at trial, the
Government would have introduced or emphasized certain evidence
relating to Brace’s ability to money launder, if it had been placed
on notice in district court that ability was at issue. But, again,
it was not placed on such notice.2
2
The dissent maintains that we should consider the
positional predisposition subissue or element, even though the
parties have failed or chosen not to do so, on the basis that legal
analysis is an inherent function of an appellate court. This
sweeping statement need not be addressed, because the “positional”
subissue (i.e., that Brace did not have the ability to carry the
underlying act to fruition) involves both factual and legal
23
In district court, in addition to not objecting to the
entrapment instruction, as discussed supra, Brace did not otherwise
mention “positional predisposition”, or a similar concept. In
fact, Hollingsworth and Jacobson, relied upon heavily in the now-
vacated Brace-portion of the panel opinion and decided long before
Brace’s trial, were not even cited by Brace at trial or sentencing.
During opening statements and closing arguments at trial,
Brace’s counsel urged that Brace was entrapped, but did not assert
“positional predisposition”, or otherwise claim that Brace was
unable to money-launder. During his opening statement, which
covered 17 pages of transcript, Brace’s counsel made the following
comments that only hinted, at best, that the “positional
predisposition” concept would be urged at trial:
Roy Clarkston ... was really a money launderer
in the true sense.
....
[The Government] got [Brace] to launder one
hundred thousand dollars, and to do as they
components. As noted above, due to Brace’s not raising the issue
of positional predisposition, the Government and the district court
were never on notice that Brace’s ability to commit the crime was
at issue, legally or factually.
Along this same line, we need not address the dissent’s
statement that, in criminal trials, sufficiency-of-the-evidence
issues may be preserved with general objections. Instead, as noted
supra, Brace’s sufficiency-of-the-evidence issue was preserved by
his general motions for judgment of acquittal; it is the factual
and legal subissue of whether Brace was in the position to commit
the crime that was never raised, and, hence not preserved.
24
told him to do by sending that money to their
account wherever.
....
Roy Clarkston ... was sending letters and
telling [Brace] how this would be done, and
we’re going to show you those letters that Roy
Clarkston created to give him the opportunity
to go to his bankers, and perpetrate the
transactions that were necessary to do this.
....
[W]e’re going to show you the simple, almost
simpleton manner in which [Brace] was talking
to these people about [how] he had to learn
these things, and you know, he’d learn them
and he’d learn them and he’d learn them. And
he’d do it, and he could do it, and he felt
that he could do it through his church and so
forth.
....
[Brace] was lying to them about his ability to
do what they wanted him to do....
Likewise, during closing argument, spanning 22 pages of
transcript, Brace’s counsel made only the following remarks
suggesting a “positional predisposition” element:
[Y]ou talk about a virgin? [Brace] goes out
and sends his assistant to the library, of all
places, to find out about money laundering so
that he could do it as effectively as possible
so that he could please them. And he did, and
he laundered.
....
God knows we have enough dope peddlers and
pushers and money launderers who are
legitimately so.
25
More importantly, during the motions for judgment of
acquittal, at the close both of the Government’s case-in-chief and
of all the evidence, neither counsel for Brace nor for Knox
presented “positional predisposition” contentions, or otherwise put
the Government on notice that this new element was being relied
upon. At the close of the Government’s case-in-chief, defense
counsel stated:
COUNSEL FOR KNOX: ... I move for a directed
verdict of acquittal on behalf of defendant
Shannon Knox. I think what the evidence has
shown is entrapment as a matter of law. There
is no evidence to predisposition, and there’s
plenty of evidence of inducement. This is
entrapment as a matter of law. So we move for
a directed verdict of acquittal at this time.
COUNSEL FOR BRACE: Yo Tambien [me also].
(Emphasis added.) And, at the close of all the evidence:
COUNSEL FOR KNOX: Your Honor, while we’re
outside the [presence] of the jury I’d like to
renew my motion for a directed verdict.
COURT: Okay. And [counsel for Brace], [do]
you join in that motion on behalf of your
client?
COUNSEL FOR BRACE: I do.
Jacobson was not cited by Knox until his motion for release
pending appeal. And, in seeking a downward departure at
sentencing, counsel for Knox referenced the
propensity to commit a crime, not necessarily
the gumption or ability, aside from being
presented the opportunity.... In real life,
how likely would it be for [Knox and Brace] to
run into real Colombian drug lords? It’s
26
pretty slim.... These aren’t the kind of
people real drug lords employ. They didn’t
have the ability, they didn’t have the
criminal make-up.
This statement was made by counsel for Knox, not Brace. In any
event, this sentencing hearing statement, which was obviously not
presented prior to the jury’s verdict, did not present the district
court with the question of whether “positional predisposition” is
an element of, or subissue for, Brace’s entrapment defense, on
which the Government would have the burden of proof.
Notwithstanding these comments by Knox’s counsel at
sentencing, Brace’s brief on appeal (considered by the panel) did
not mention “positional predisposition”. That brief lists the
entrapment issue merely as: “Whether Brace was entrapped as a
matter of law by the undercover government agents”. Fourteen pages
into his 15-page section on “entrapment as a matter of law”, Brace
finally included the following language:
Clearly, Brace and Knox were not capable
of designing, funding and completing a money
laundering scheme on their own, without the
government’s substantial assistance and
inducement. As evidenced by their statements
and actions during the course of the
investigation, they were indeed “virgins” and
“wannabe” money launderers, not the real
thing. [S]ee United States v. Hollingsworth,
27 F.3d 1196, 1202 (7th Cir. 1994) (real money
launderers or drug dealers would never have
dealt with or relied on such clear novices.)
As in Hollingsworth, Brace and Knox had no
prayer of becoming money launderers without
the government’s help in supplying the
contacts, the money and the know-how. “Anyone
can wire transfer money, but to get into the
27
international money laundering business you
need underworld contacts, ... financial assets
or acumen, and the defendants had neither.”
Id., at 1202. The Hollingsworth facts are
similar to this case in that the defendant had
placed a legitimate advertisement to sell a
Grenadian banking license, as Brace had with
the prospectus, and the undercover agents
played on his financial trouble to induce him
into money laundering with instructions and
money supplied by the government. Id., at
1199-1202. There, as in Brace’s case, the
government made no effort at trial to show
that a real money launderer would have
responded to the legitimate advertisement, or
prospectus in this case. Id., at 1199. As in
Hollingsworth, the government agents in
Brace’s case turned two harmless, though weak,
foolish and greedy, men into felons. Id., at
1202.
(Citations to the record omitted.)
These comments, and the cites to the non-binding decision in
Hollingsworth, fall far short of presenting, for the first time on
appeal (for which we would engage only in limited plain error
review — as urged belatedly by the Government at en banc oral
argument), the question of whether our court should add a
“positional predisposition” element when the circumstances of a
particular case might justify our doing so. For our court to do so
would require breaking new ground. These comments in Brace’s brief
certainly did not ask the panel to do so, or flag in any real way
that Brace was urging anything other than the standard, normal
predisposition analysis.
This is confirmed by the fact that the Government’s brief to
the panel did not mention “positional predisposition”. In this
28
regard, the now-vacated Brace-portion of the panel opinion stated:
“The government, however, fails to address the positional and
dispositional aspects of predisposition”. Knox, 112 F.3d at 809
(vacated). Likewise, that now-vacated part of the panel opinion
states: “[I]n its brief, the government fails to even cite
Hollingsworth, let alone deal with it substantively”. Id. at 809
n.12 (vacated).
However, as stated, a “positional predisposition” contention
was never presented to either the district court or this court;
therefore, there was no notice to the Government that it was at
issue. As noted, Hollingsworth, decided before Brace’s trial, was
never cited in district court. And, even though Brace cited
Hollingsworth in his brief to the panel, he did not sufficiently
raise “positional predisposition”. Therefore, it is most
understandable both that the Government would not have understood
it was at issue, and that, therefore, it did not feel it necessary
to distinguish a Seventh Circuit opinion, which we had not (and
have never) adopted, when our circuit already had existing, well-
settled case law on entrapment.
In fact, the law of our circuit is at least arguably contra to
the holding in Hollingsworth. See United States v. Rodriguez, 43
F.3d 117, 126-27 (5th Cir. 1995) (“The active, enthusiastic
participation on the part of the defendant is enough to allow the
jury to find predisposition.”). We have consistently held that
29
“[a] prosecution cannot be defeated merely because a Government
agent has provided the accused with the opportunity or facilities
for the commission of the crime”. United States v. Williams, 613
F.2d 560, 562 (5th Cir. 1980) (citing United States v. Dickens, 524
F.2d 441 (5th Cir. 1975), cert. denied, 425 U.S. 994 (1976))
(emphasis added); accord United States v. Yater, 756 F.2d 1058,
1062 n.6 (5th Cir. 1985), United States v. Jones, 693 F.2d 343, 347
(5th Cir. 1982), United States v. Tobias, 662 F.2d 381, 384-85 (5th
Cir. 1981), cert. denied, 457 U.S. 1108 (1982), United States v.
Bradsby, 628 F.2d 901, 904 (5th Cir. 1980).
It is noteworthy that Brace did not file a reply brief with
the panel. Needless to say, had Brace felt “positional
predisposition” was at issue, he should have filed a reply brief in
order to comment on the Government’s failure to address that point.
Accordingly, based on the above-stated pertinent excerpts
presented in the district court and in Brace’s brief to the panel,
Brace did not sufficiently, much less specifically, raise the
subissue of “positional predisposition” before either the district
court or the panel. Moreover, even after the now-vacated Brace-
portion of the panel opinion nevertheless adopted the “positional
predisposition” element, Brace still does not appear, on rehearing,
to contend that this subissue is necessary for his appeal. His
lack of support for a separate “positional predisposition” element
is even more significant in the light of the clerk of this court
30
advising counsel by letter that “the en banc court is primarily
interested in the question of positional predisposition raised in
the government’s petition for panel rehearing”.
In fact, Brace claims that this factor does not alter existing
case law in this circuit. In his supplemental (en banc) brief, he
states:
[T]he panel’s decision to apply the reasoning
set forth in Hollingsworth to Brace’s case
does not conflict with or overturn a prior
Fifth Circuit case on entrapment because it
merely makes explicit a similar “readiness”
analysis already employed in this Circuit.
....
Perhaps, it is an imaginary and unnecessary
line that is being drawn when the
predisposition analysis is artificially
divided into “mental” factors and “positional”
factors.
....
It is not necessary to adopt a new factor in
the predisposition analysis, or to re-
interpret Jacobson or set new precedent, in
order to reverse Brace’s convictions and
correct the injustice. While useful in a case
like this, it is not even necessary to adopt
the Hollingsworth “positional” predisposition
analysis to reach the conclusion that Brace
was entrapped as a matter of law. ... Brace’s
convictions can, and should, be reversed
simply by following Jacobson and this
Circuit’s other entrapment cases.
(Emphasis added.)
Similarly, at en banc oral argument, Brace’s counsel seemed to
disclaim reliance on “positional predisposition”:
31
COURT: Is it your position that the panel
opinion in this case did or did not impose a
new requirement on the government in
entrapment cases in this circuit?
COUNSEL FOR BRACE: I don’t think that it is a
new requirement by imposition. I think it’s
another way of the government being able to
establish to a jury the idea that a defendant
had to [] be predisposed....
....
I don’t think that it’s a new element that had
to be imposed or that was imposed by [the
panel opinion].
(Emphasis added.)
Again, the new “positional predisposition” element, utilized
by the panel, was neither preserved in district court nor raised
for the first time on appeal. Apparently, Brace did not consider
it a necessary subissue for the entrapment issue that was raised.
And, neither before, nor even after, the vacated panel opinion has
Brace specifically urged it.
It bears repeating — indeed, cannot be overemphasized — that
we do not address issues not presented to us. And, even if, in
taking a case en banc, we notify the parties of our interest in a
particular issue addressed by the panel opinion, as we did in this
case, that does not mean we can, or will, address that highlighted
issue if we determine during en banc review that it was not
presented on appeal to the panel. In sum, the vacated, quite
short-lived “positional predisposition” element or subissue is not
32
before us, not even for limited plain error review. Accordingly,
we cannot address it.
2.
Consequently, the only issue presented by Brace relating to
his entrapment defense is whether, under existing relevant
precedent, the evidence was sufficient to prove, beyond a
reasonable doubt, that he was predisposed to launder money. As
shown supra, this issue was preserved by Brace’s judgment of
acquittal motions.
As discussed, when the Government has induced a defendant to
commit a criminal act, and the defendant raises an entrapment
defense, the Government must prove that the defendant was disposed
to commit the criminal act prior to first being approached by
Government agents. Jacobson, 503 U.S. at 548. We will reverse the
verdict only if no rational juror could have found predisposition
beyond a reasonable doubt. Byrd, 31 F.3d at 1335. The evidence
presented at trial was more than sufficient to support the jury’s
implicit finding of no entrapment.
At trial, Brace summarized his defense in his testimony: “I
chose to launder money because I was presented with the approval of
a ten million dollar loan that I desperately needed to pay the
debts of the church. That’s why I laundered money.” But, he
admitted that he would have laundered the money even if the
undercover Agents had actually been drug traffickers. Moreover, he
33
admitted that his wife told him to withdraw when she learned that
he was accepting drug proceeds.
As described supra, Brace’s church’s financial difficulties
were quite apparent by 1993; he first met with undercover Agents in
March 1995. The evidence was sufficient to show that Brace was
predisposed to launder money even before that first meeting, in
which the $10 million offer was made. Wichita Teamsters Union
President Landwehr testified that, several times in September 1993
(long before Brace first met the Agents) and after, Brace had asked
if Landwehr had made contact with his “Mafia Friends”. Raccuglia
testified that, during staff meetings around April 1995, Brace
asked a staff member from New York, who had an associate who was a
nephew of John Gotti (who was convicted and sentenced to life
imprisonment in 1992 for murder and racketeering), if he had any
connections that would be useful in raising funds. Brace’s wife
would leave the room during these conversations regarding
“connections”, commenting that she did not want to hear it.
Landwehr and Raccuglia testified that, in this context, they had
heard Brace state, on different occasions: “The wealth of the
wicked is laid up for the righteous”.
As discussed supra, in early March 1995, prior to Brace’s
first meeting with the Agents, Agent Cisneros recorded telephone
conversations with Clarkston, in which Clarkston stated that he had
a “major big time guy” from “a church group” who was “very
34
interested” in meeting with Agent Cisneros and would like to
“close” the next weekend. During a meeting on 17 March 1995,
between Agents Gonzalez and Cisneros and Clarkston, Clarkston told
them that he knew a minister interested in laundering money and
that the minister’s financial advisor was already in town and
wanted to meet with them. Agents Gonzalez and Cisneros testified
that, when they asked Clarkston whether the minister knew that
Agent Gonzalez was a cocaine dealer looking to launder the proceeds
from cocaine sales, Clarkston informed them that the minister knew
about the source of the funds and did not care.
Later that same day, during a meeting between the Agents,
Clarkston, and Knox, the Agents informed Knox, early in the
conversation, that Agent Gonzalez was a Colombian drug trafficker
and that the deal involved laundering money from cocaine proceeds.
Agent Gonzalez testified that Knox responded that he and the
minister were aware of this and were not concerned about the source
of the money.
The above evidence, produced at trial, was more than
sufficient for the jury to conclude that Brace was predisposed to
launder the money before his first meeting with the Agents, in
which the $10 million offer was made. With respect to that first
meeting, as stated previously, the Agents offered the $10 million
before explaining that the money came from drug trafficking; but,
as demonstrated above, the evidence was sufficient for the jury to
35
conclude that Brace was already aware of the source of the money.
Moreover, during this same meeting, Agent Cisneros stated
“that the money is from the sale of cocaine trafficking. That it
is narcotics money. ... [Undercover Agent Gonzalez] is asking you
to launder money”. Brace immediately responded: “I don’t have a
questionnaire ... where these monies come from” and that he had
received funds “from sources that, uh, would be questionable”.
Brace stated later in the meeting: “I appreciate the fact that you
want to be very straight forward and up front with me. ... but, uh,
that does not concern me, really”.
Again, for an entrapment issue, our focus is on whether the
defendant was disposed to commit the criminal act prior to the
first contact by the Government. Jacobson, 503 U.S. at 548. But,
it is equally clear that “[e]vidence of the defendant’s ready
response to the solicitation, as well as evidence of independently
motivated behavior that occurs after government solicitation
begins, can be used to prove that the defendant was predisposed,
i.e., ready and willing to [commit the crime] even before he was
contacted by the government”. Byrd, 31 F.3d at 1336 (emphasis
added).
The evidence sufficiently showed that Brace’s predisposition
was evidenced throughout the undercover operation. At the second
meeting between Brace and the Agents, in which Brace took the first
$100,000 test amount, Brace clearly understood that the funds were
36
proceeds from the sale of cocaine and that he was being asked to
money launder such funds. In fact, he took the money even after
the Agents told him that they had “crossed” three tons of cocaine
into the United States the previous day.
Raccuglia testified that, in April 1995, after Brace returned
to Kansas with the first test amount, Brace told him that the money
came from Colombian drug dealers; that the money was an advance on
$10 million; and that this was a test of his ability to transfer
the funds. Brace told Raccuglia that the drug dealers stored the
money in stash houses, and had brought in a large shipment of
cocaine; but, that he was not concerned about the source of the
money, because he had received “authorization from God”. Raccuglia
testified that Brace had said, “I’ve heard from God like I’ve never
heard before”. Brace also talked with Raccuglia about installing
a safe in his church office and getting a separate security system.
After the second test transfer, Brace discussed with Raccuglia
and another staff member about opening a storefront check cashing
service in order to convert cash to checks while avoiding the
reporting requirement.
In sum, under existing relevant precedent, the evidence
produced at trial, highlighted above and detailed at the outset of
this opinion, is more than sufficient for a rational juror to
conclude, beyond a reasonable doubt, that Brace was predisposed to
launder money. See Byrd, 31 F.3d at 1335.
37
B.
As noted, Brace did not object at trial to Fifth Circuit
Pattern Instruction No. 1.28, concerning entrapment. Accordingly,
in belatedly challenging it now, he concedes, as also noted, that,
to prevail on this issue, the instruction must have constituted
plain error. FED. R. CRIM. P. 52. Because the panel found that
Brace was entrapped, it did not address this issue with respect to
him; it did with respect to Knox.
As also noted, following Brace’s trial, a panel of our court,
in Hernandez, 92 F.3d at 311, held that the entrapment pattern jury
instruction, identical to that given Brace’s jury, is correct under
Jacobson. In fact, as discussed supra, Knox likewise failed to
object to the jury instructions and raised an argument identical to
Brace’s before the panel; the panel also held that Hernandez
controls. Knox, 112 F.3d at 810 (non-vacated portion).
In short, there was no error, much less plain error. See,
e.g., Calverley, 37 F.3d at 162-64 (holding that plain error
requires error that is obvious, clear, or readily apparent, and
that affects substantial rights; and that, even if these conditions
are satisfied, reversal of such error is discretionary).
C.
In his brief to the panel, Brace contested his sentence on
three bases. Again, because the panel vacated Brace’s conviction,
it did not address his sentence.
38
1.
First, Brace contends that he should have been given a
downward departure, due to Government manipulation. See U.S.S.G.
§§ 2D1.1, App. Note 17 and 5K2.12; 18 U.S.C. § 3553(b). The
district court may depart downward from the sentencing range
prescribed by the guidelines based on mitigating circumstances “of
a kind, or to a degree, not adequately taken into consideration by
the ... guidelines”. U.S.S.G. § 5K2.0.
We may only review a trial court’s refusal to
grant a downward departure from the Guidelines
if the refusal was based on a violation of the
law ... Thus, we have jurisdiction if a
district court’s refusal to depart downward is
premised upon the court’s mistaken conclusion
that the Guidelines do not permit such
departure, but we have no jurisdiction if the
court’s refusal is based on its determination
that departure is not warranted on the facts
of the case.
United States v. Palmer, 122 F.3d 215, 222 (5th Cir. 1997) (citing
United States v. Mitchell, 964 F.2d 454, 462 (5th Cir. 1992)); see
also United States v. Lugman, 130 F.3d 113, 115 (5th Cir. 1997).
Brace claims that the Government intentionally manipulated his
sentence by inducing him to launder three “test” amounts ($100,000,
$100,000, and $150,000) as a precondition to receiving the $10
million that he was really seeking. These amounts mirror the
sentence increases in U.S.S.G. § 2S1.1(b)(2). Brace asserts
further that the Agents could have arrested him after any one of
39
the illegal transfers, but instead were interested in “running up
the tab”.
But, Brace does not contend that the denial of a downward
departure was “premised upon the court’s mistaken conclusion that
the guidelines do not permit such departure”. See Palmer, 122 F.3d
at 222. Accordingly, we lack jurisdiction to review the court’s
discretionary conclusion. See Lugman, 130 F.3d at 115.
2.
a.
Brace next maintains that the district court erred by denying
a three-level reduction in his base offense level because, at the
time of arrest, he and his co-conspirators had not completed all
the acts believed necessary to launder the $10 million.
Knox made an identical contention to the panel, and it found
no error. Knox, 112 F.3d at 812-13 (non-vacated portion). For the
reasons stated in the panel opinion with respect to Knox, we
conclude that the district court did not clearly err in denying the
three-level reduction with respect to Brace. See id.
b.
In conjunction with the above non-completion contention, Brace
also appears to contend that the district court incorrectly applied
the money laundering guideline, U.S.S.G. § 2S1.1, to the conspiracy
offense, resulting in an incorrect sentence. See 18 U.S.C. §
3742(f). Brace did not make this contention during sentencing;
40
therefore, we review only for plain error. Calverley, 37 F.3d at
162-64.
Brace concedes that the district court correctly applied §
2S1.1 to the three substantive money laundering counts (totaling
$350,000), but asserts that it erred by also applying it to the
conspiracy count (totaling $10 million). The aggregated amounts of
these four counts resulted in a nine-level increase in Brace’s base
offense level (for more than $10 million), rather than a two-level
increase (for more than $200,000).
Brace relies on U.S.S.G. § 2X1.1(c), which provides that “when
an attempt, solicitation or conspiracy is expressly covered by
another offense guideline section, apply that guideline section”.
(Emphasis added.) Application Note 1 to § 2X1.1 lists the
attempts, solicitations, and conspiracies that are explicitly
covered by the guidelines, and § 2S1.1 is not listed. Therefore,
Brace contends, the district court should have applied § 2S1.1 to
the three substantive counts and § 2X1.1 to the conspiracy count.
Brace maintains that this would result in an offense level of 25
for the three substantive counts under § 2S1.1 and an offense level
of 23 for the conspiracy count under § 2X1.1. Consequently, Brace
contends, the grouping of multiple counts under § 3D1.2(b) would
result in an overall level of 25, with a corresponding sentencing
range of 57 to 71 months, rather than the 175 month sentence he
received.
41
Brace was convicted on charges brought under 18 U.S.C. §
1956(h) (conspiracy to launder money) and 18 U.S.C. §
1956(a)(2)(B)(i) and (a)(3)(B) (money laundering). In sentencing,
the conspiracy and substantive counts were properly grouped
pursuant to U.S.S.G. § 3D1.2. The statutory provision for
conspiracy, 18 U.S.C. § 1956(h), provides: “Any person who
conspires to commit any offense defined in this section ... shall
be subject to the same penalties as those prescribed for the
offense the commission of which was the object of the conspiracy.”
Accordingly, in determining Brace’s sentence, the district
court did not plainly err by applying § 2S1.1 to the conspiracy and
substantive counts.
3.
Finally, Brace contends that, because of his acceptance of
responsibility, he is entitled to a two-level decrease in his base
offense level. Of course, whether the defendant demonstrates such
acceptance is a factual question; in fact, we will overturn the
district court’s finding on that question only if it is without
foundation. United States v. Perez, 915 F.2d 947, 950 (5th Cir.
1990); see also United States v. Rickett, 89 F.3d 224, 227 (5th
Cir.), cert. denied, ___ U.S. ___, 117 S. Ct. 499 (1996); United
States v. Vital, 68 F.3d 114, 121 (5th Cir. 1995) (giving “great
deference” to the district court’s acceptance of responsibility
findings).
42
Brace relies on U.S.S.G. § 3E1.1(a), which provides for the
two-level decrease “[i]f the defendant clearly demonstrates
acceptance of responsibility for his offense”. Application Note 2
provides, in pertinent part:
Conviction by trial, however, does not
automatically preclude a defendant from
consideration for such a reduction. In rare
situations a defendant may clearly demonstrate
an acceptance of responsibility for his
criminal conduct even though he exercises his
constitutional right to a trial. This may
occur, for example, where a defendant goes to
trial to assert and preserve issues that do
not relate to factual guilt (e.g., to make a
constitutional challenge to a statute or a
challenge to the applicability of a statute to
his conduct). In each such instance, however,
a determination that a defendant has accepted
responsibility will be based primarily upon
pre-trial statements and conduct.
(Emphasis added.)
Brace claims that he satisfied § 3E1.1 because he went to
trial only to preserve the “legal issue” of entrapment. Along this
line, he notes that he fully admitted, in his pretrial confession
and trial testimony, to his “factual guilt”.
The Government responds correctly that, although Brace
admitted committing the criminal acts, his assertion of entrapment
was a denial of factual guilt, because it is a denial of subjective
predisposition and, consequently, of the required element of mens
rea.
In other words, an entrapment defense is a challenge to
criminal intent and thus to culpability. Accordingly, this is not
43
one of those “rare situations”, contemplated by the guideline
commentary, in which a defendant may proceed to trial and still
satisfy § 3E1.1(a).
III.
Possibly, there remains for another day and another case the
issue of whether, under the appropriate circumstances, the
Government must prove “positional predisposition” when an
entrapment defense is raised. That issue was not presented in this
case; therefore, mindful of our limited and proper role, we do not
address it. With that issue not being in this case, we are faced
instead with a straightforward application of well-established and
understood precedent as to entrapment and sentencing. For the
reasons given, the judgment as to Brace is
AFFIRMED.
44