UNITED STATES of America, Plaintiff-Appellee, v. Danny Lynn QUALLS, Defendant-Appellant
172 F.3d 1136
9th Cir.
1999
Check Treatment

*1 Allen, In United Conviction AFFIRMED, sentence VA- Cir.1996), denied, 520 CATED and for further REMANDED 137 L.Ed.2d 711 proceedings. (1997), this rejected the claim that

for purposes of Guidelines sentencing, in

terest paid defendant on the loan

should be subtracted from the principal

lost. Banks extend loans pur sole

pose of earning income; interest allowing

Davoudi to subtract interest payments

from the principal the bank lost would treat the mortgage as an interest-free UNITED America, STATES of fact, loan. In unpaid interest in fraudulent Plaintiff-Appellee, loan cases considered an actual loss to the victims. District may Courts choose to Danny Lynn QUALLS, include unpaid Defendant- interest still due on the loan Appellant. in the calculation of the victim’s actual loss.3 paid by Interest the defendant can No. 95-50378. not, thus, reduce the amount of principal by victim; lost it only can Court Appeals, reduce the amount of interest outstanding Ninth Circuit. on the loan. The treatment of interest should be April

identical in the loss calculation under § 3663. Because contractual interest

aon loan is speculative and is the

raison loan, d’etre the district court

may also choose to include interest still

due on the loan in the loss calculation for

purposes of restitution. The expected in-

terest that remains unpaid is an actual loss

to the lender. Interest paid is irrelevant

except reduces the total outstanding

interest.

The district court correctly followed our

precedent in its treatment the interest

on the HSA loan.

V. Conclusion

We remand only the portion of Davou-

di’s sentence ordering restitution to HSA.

The property recovered HSA should be

valued at the time HSA “had the power to

dispose of the property” as it wished. 3. A may district court choose include inter- interest borrower agrees to pay in re- est due at the time the offense is discovered in turn for a loan fraudulently See, obtained. the loss despite calculation 2F1.1, the statement e.g., Porter, comment, USSG n. that loss "does Cir.1998) cases). (collecting not ... include interest the victim language could have only refers to the speculative return earned on such funds had the offense not the victim could have earned elsewhere had occurred.” This language does refer to the loan not been obtained by the defendant. *2 by Judge CYNTHIA

Opinion HALL; Partial concurrence HOLCOMB MICHAEL by Judge Partial dissent DALY HAWKINS. HALL, HOLCOMB Circuit

CYNTHIA Judge: — v.

In -,

(1998), Court vacated our en and remanded banc in light in to us for reconsideration S.Ct. (1998). After care L.Ed.2d reconsideration, Qualls’ con we affirm ful viction.

BACKGROUND Qualls (“Qualls”) Danny Lynn deadly with a guilty weapon to assault pled Penal Code violation of California 245(a). court § California felony probation, suspended Qualls 1980, the Califor- proceedings. further early termination of court ordered nia by Qualls upon payment Qualls’ probation as- Although costs. probation of $500 may be deadly weapon either sault with a felony under Califor- or a a misdemeanor law, Qualls’ case nia circumstances felony. it a made felony was a because Qualls’ conviction by more than punishable was the offense see United States year one prison, Horodner, Cir. 1993), did not the conviction and because a misdemeanor under either as qualify (3). 17(b)(1) § Code Penal California early termination Qualls’ payment $500 fee to merely was a cover his probation and was probation, of Qualls’ the costs imprisonment other than “punishment Code See Cal.Penal prison.” the state 17(b)(1). addition, Qualls’ initial pro § imposing pun “judgment bation was anot than imprisonment ishment other id.; prison.” See HUG, Judge, Chief Before: Cir.1992) Robinson, FLETCHER, BROWNING, (citations omitted). the California Finally, THOMPSON, PREGERSON, HALL, Qualls’ never conviction declared KLEINFELD, NELSON, TROTT, misdemeanor, T.G. nor did ever THOMAS, HAWKINS, Circuit his offense declared a misdemeanor. have 17(b)(3); People Cal.Penal Code See Judges. (1991) Banks, 348 L.Ed.2d 371 1 Cal.Rptr. 53 Cal.2d verdict to be (requiring (1959) (in banc). set aside Under “verdict is on supportable P.2d ground, another, one law, but and it is prohibited California impossible to tell which ground jury revolvers, con possessing pistols, or other selected”) (citation omitted). See United cealable firearms. See Cal.Penal Code *3 Qualls, 1019, States v. 108 F.3d 1024 Loomis, 12021(a); Cal. People 231 Cir.1997). We then en banc re (Cal.Ct. 594, 596, App.2d Cal.Rptr. view in this case to reexamine our decision App.1965). in Dahms. See States v. 1994, Qualls In indicted for know- was 824, Cir.1998) (en banc) 140 F.3d possessing ingly seven firearms—two re- Qualls II], vacated, [hereinafter - U.S. volvers, pistol, one and four rifles—in vio- -, 398, 142 119 S.Ct. L.Ed.2d 323. lation of felon-in-possession the federal II, Qualls holding we reiterated our statute, § 922(g)(1). At U.S.C. in Dahms that felon-in-posses the federal time, Qualls pos- California law allowed to apply sion statute does to a former rifles, any sess of the four but did not possesses felon who a firearm that he is possess allow him to either the two to possess allowed under state law. See pistol. interpretation revolvers or the Our rejected 826. In so doing, of the federal felon-in-possession statute the all-or-nothing interpretation of the fed Qualls possess any allowed to weapon that felon-in-possession eral statute that had possess he was allowed to under state law. adopted by been other circuits. See Unit 131, See United States v. 938 F.2d Estrella, (1st 3, ed States v. 104 F.3d (9th Cir.1991). Therefore, at the Cir.) (prohibiting a felon from possessing trial, Qualls’ Qualls time of could have 921(a)(20) §§ all firearms under 18 U.S.C. only jury been if the convicted unanimous- 922(g)(1) if the felon is prohibited from ly Qualls agreed possessed that had either law), possessing any firearm under state of the pistol, two revolvers the but not denied, 1110, 2494, cert. 521 U.S. 117 S.Ct. any one of the four rifles. id. See (1997); 138 L.Ed.2d 1001 trial, however, At the district court in- Driscoll, (6th Cir.1992) 1472, 1480 970 F.2d jury Qualls structed the that could be con- (same); Burns, United States v. jury victed if the unanimously agreed (10th Cir.1991) 1157, 1160 (same). government proved beyond the had a rea- Caron, Supreme the Court adopted Qualls possessed sonable doubt that any the all-or-nothing construction of the fed one of the firearms described in the indict- felon-in-possession eral statute. See 524 time, ment. At that the district court’s at -, U.S. 118 S.Ct. at 2010-12. instruction was erroneous. Although light Caron, of the rule announced in convicted, Qualls was way there was no to the Court asked tous reconsider determine which of the seven weapons list- our earlier this case. ed in jury the indictment had unani- DISCUSSION mously Qualls agreed that possessed. had It impossible was therefore to determine recognize We today Caron’s Qualls whether been had convicted on a binding interpretation of the federal felon- Consequently, proper basis. we reversed in-possession statute, Qualls apply Qualls’ conviction under the all-or-nothing rule announced in Car-o Griffin 46, 52, 502 U.S. 112 S.Ct. 116 n.1 retroactively When we apply process 1. Due application bars (1998). retroactive 140 L.Ed.2d 683 judicial a expansion only of a law if the change held a is in the law foresee- change in the law is unforeseeable. See able split proper on the circuits are Ohio, Brown v. 432 U.S. 169 n. of a See United construction statute. (1977); S.Ct. 53 L.Ed.2d 187 Poland v. 475, 484, Rodgers, S.Ct. 466 U.S. Stewart, (9th Cir.1997), (1984). In this L.Ed.2d 492 - denied, -, 118 S.Ct.

1X39 find Qualls, we rule (1998), retroactively Qualls. jury instruction court’s district Caron, be could Under erroneous. a departure Rodgers represents any one possessing convicted principle that: time-honored he was indicted. for which firearms seven at - - -, Caron, have criminal law must required “[T]he See jury The district court’s issue oc- at 2010-12. the conduct in S.Ct. existed when be consistent with Caron curred,” retroac- instruction to bar ... must jury court instructed cause district emanating prohibitions tive criminal jury be convicted if could legislatures. as well as from from courts beyond a reasonable doubt found judicial construction of If a *4 weap of the any one possessed had “unexpected and indefensible statute is Therefore, in the indictment. ons listed been to the law which had by reference the properly instructed the district issue,” at to the conduct expressed prior jury. retroactive effect. given be must not 347, Columbia, 378 U.S. City v. Bouie of CONCLUSION (1964) 354, 1697, 12 L.Ed.2d 894 84 S.Ct. affirm foregoing, the Based on Ohio, (citation omitted); v. see also Brown Qualls’ conviction. 2221, 8, 161, 53 169 n. 97 S.Ct. 432 U.S. (due (1977) AFFIRMED. process prohibits 187 L.Ed.2d expan- judicial of application retroactive HAWKINS, Circuit DALY MICHAEL in law is “unfore- change of when sion laws FLETCHER, Judges Judge, whom with States, 430 seeable”); Marks v. United join, and THOMAS PREGERSON 990, 191-92, 51 L.Ed.2d 97 S.Ct. U.S. part: Concurring part Dissenting and (1977) (when a crim- interprets a court 260 cover behavior consid- statute to inal and it is I While unfortunate concur. may process due past, in the ered unlawful effort making good faith unfair those to Potts, 528 violated); v. States be United law, majority the existing with comply to (en banc) (9th Cir.1975) 883, 886 F.2d v. correctly concludes United expand- and precedent (overruling circuit 475, 484, U.S. 104 S.Ct. Rodgers, 466 hot statute will liability under (1984), ing thus 492 controls and 80 L.Ed.2d of due retroactively because applied be hold- Supreme the Court’s we must considerations). process 524 U.S. ing Caron foreseeable, due change law was split proper on the construction were circuits by applica- violated retroactive process is not felon-in-possession statute of the federal Qualls. To the extent rule to of the he was tion the acts for which committed Albertini, Driscoll, v. in United States that our decision indicted and convicted. See Cir.1987), (9th rule); conflicts with 830 F.2d 985 (all-or-nothing F.2d at 1480 Albertini, (8th Ellis, Rodgers, we overrule Albertini. Cir. rely could on 1991) (absent we stated an individual full restoration firearms of all); opinion ... until controlling court "the latest rights at rights, not restored civil reversed, (9th the or at least until is 938 F.2d certiorari.” Id. (felon granted 1991) has right carry fed Court has to under Cir. however, the Rodgers, at 989. any weapon that is under eral allowed law conflicting Burns, (all-or- of law); existence stated that “the at Court Estrella, re- Appeals made rule); Courts other F.3d at 7- cases from nothing see also against Lee, rule); by that issue (all-or-nothing view of United States reasonably Cir.1995) (absent respondent position of full at 104 S.Ct. rights not rights, civil foreseeable.” of firearms restoration or the Tomlinson, Thus, Rodgers, reversal all); under 1942. at restored to due (felon immaterial (4th Cir.1995) are grant has certiorari instead, existence of a any weapon carry process inquiry; law right under federal inquiry. Therefore, of that law). focus split circuit is allowed under state rejecting the argument that “because due process would block us from applying precedent] [1967 on the been books this correct reading of the statute retro in the Eighth Circuit for a number of spectively Qualls.”), years a contrary by decision this Court — vacated, U.S. -, 119 S.Ct. should not be applied retroactively him,” (1998); yet, because in this the Court held that “even if [Rodgers] instance the Supreme Court has corrected could establish upon reliance the earlier our interpretation, process due consider decision, ... argument] [his would be una- ations are longer no applicable. vailing since the existence of conflicting The majority’s holding that Rodgers re cases from other Courts of Appeal made quires tous overrule United States v. Al review of that issue by this Court and 830 F.2d 985 Cir.1987), bertini com against position respon- pounds unnecessarily dent the unfairness reasonably of the Rodgers, foreseeable.” rule imposed on us Rodgers. We held Rodgers, Caron, like in Albertini a case in “[i]f process which the the due Court’s dispositive clause is to interpretation of a mean statute ex- anything, it should mean panded the scope of that a person criminal liability in who holds the latest control some circuits—the overruled Eighth ling Cir- court opinion declaring his activities cuit interpretation would not have allowed constitutionally protected should be able to *5 Rodgers prosecuted. to be depend on that ruling to protect like activi Rodgers ties from has the effect of conviction requiring until a citizen opinion look not to reversed, established law or at of least until the the circuit in resides, which he but to Court certiorari.” law of the circuit taking the most Id. at expan- 989. The majority opinion’s decision sive view of prohibited conduct by a stat- to overrule Albertini means that ute, to determine what conduct he may future even who, someone in the words of undertake without risk of criminal prose- Albertini, “[i]n effect ... obtained a de cution until that point in time when the claratory judgment from this court that Supreme Court any resolves interpretative the actions in which he engaged were law disagreement among the circuits. This ful,” id., would still not be rely entitled to can have the effect of restraining years on that decision so long as even one other conduct that the Court may ultimately de- circuit court had come to a contrary con cide was always perfectly legal. clusion. case, Qualls could have canvassed facts, On its Qualls does not require that state law and law,” “settled circuit see we answer anew the question narrow of Walsh, F.2d Albertini of “whether a person whose con Cir.1985), at the time he took duct has been tried in court and vindicated possession of the long guns and concluded on appeal can rely upon the court’s deci under both that his possession was not sion repeating the same conduct after prohibited or prosecutable behavior. It receiving the appellate judgment, when the seems anomalous and Unfair to government has either petition filed a had we overruled United States v. certiorari or still has time to file such a Cir.1991), ourselves in petition, en banc Court has not consideration of case, his acted to grant would or likely deny the petition.” have held we could Id. not apply Qualls, corrected statutory Rodgers like interpretation ret- unlike roactively Albertini, Qualls, because involves of defendant who did consid- erations expressed Bouie, see demonstrate actual reliance on a prior de Qualls, (9th cision, or even that he had attempted to Cir.) (en banc) (Hall, J., concurring) ascertain the the law before choos (“Even if wé were to adopt the ‘all ing his course of action. This court need nothing’ approách of our sister circuits, the holding decide whether of Alberti

H41 to reverse Rodgers trumped isni its decision

panel rever way material is in no so

do

sal. result reluctantly in the I concur

While dissent I respectfully in this

reached as insofar majority mandates today that its decision

concludes must be overruled. Albertini Crystal; CRYSTAL; Victoria

John Pools, Inc., Crystal

John

Petitioners-Appellants, America, STATES

UNITED

Respondent-Appellee.

No. 97-56204. Appeals,

Ninth Circuit. *6 3, 1999. Submitted March

Argued and 16, 1999. April

Decided