United States v. Stoian
2014 U.S. Dist. LEXIS 176259
| E.D. Ky. | 2014Background
- Defendants pleaded guilty to conspiracy to commit wire fraud, carrying a maximum penalty of up to 20 years’ imprisonment.
- Court must determine loss under U.S.S.G. § 2B1.1 by calculating actual or intended loss and reasonably foreseeability.
- Government proposed calculating loss using a ledger-verified period and extrapolating to the conspiracy’s full duration.
- Court accepts a “reasonable estimate” of loss, not precise calculation, and notes data gaps due to co-defendants’ concealment.
- Court adopts a composite loss figure of $2,534,518.01, based on $3,370.37 per day over 752 days, plus related wire transfers, as the reasonable loss.
- Court then allocates loss to each co-defendant by assessing each defendant’s joint participation, foreseeability, and duration of involvement, applying the same daily loss rate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Loss estimation method | United States argues for ledger-based average extrapolation | Defendants contest extrapolation beyond ledger period | Reasonable estimate allowed; extrapolation permissible with preponderance of evidence. |
| Joint and several loss allocation | All reasonably foreseeable acts in furtherance of joint conspiracy included | Limit to actor’s direct actions or ledger period | Foreseeability and joint undertaking used to allocate loss per each defendant. |
| Period of involvement | Involvement spans ledger period plus ongoing conspiracy | Timeframe should be limited to specific days asserted | Days of involvement determined per defendant, with adjustments for non-activity days. |
| Overseas transfers and non-ledger data | Include verified outside-ledger wire transfers | Exclude unverified or distant-period activity | Verified outside-ledger losses included if supported by preponderance of evidence. |
Key Cases Cited
- United States v. Bryant, 128 F.3d 74 (2d Cir. 1997) (estimate loss by averaging known data in frauds)
- United States v. Triana, 468 F.3d 308 (6th Cir. 2006) (loss may be estimated where precise calculations are impractical)
- United States v. Mei, 315 F.3d 788 (7th Cir. 2003) (approval of averaging as reasonable method of calculating loss)
- United States v. Scott, 250 F.3d 550 (7th Cir. 2001) (loss estimation in fraud cases via averaging)
- United States v. Jarrett, 133 F.3d 519 (7th Cir. 1998) (supports extrapolated loss where exact amounts unknown)
- United States v. Wai-Keung, 115 F.3d 874 (11th Cir. 1997) (loss calculation guidance in fraud schemes)
- United States v. Koenig, 952 F.2d 267 (9th Cir. 1991) (use of reasonable loss estimation)
- United States v. Johnson, 185 F.3d 765 (7th Cir. 1999) (limits on speculative loss estimation)