UNITED STATES OF AMERICA, Plaintiff - Appellee, v. PAMELA KATHRYN CONLEY, Defendant - Appellant.
No. 22-5112
United States Court of Appeals for the Tenth Circuit
December 22, 2023
PUBLISH.
Lynn C. Hartfield, Law Office of Lynn C. Hartfield, LLC, Denver, Colorado, for Defendant - Appellant.
Steven J. Briden, Assistant United States Attorney, (Clinton J. Johnson, United States Attorney with him on the brief), Tulsa, Oklahoma, for Plaintiff – Appellee.
Before MATHESON, PHILLIPS, and MORITZ, Circuit Judges.
MATHESON, Circuit Judge.
Pamela Kathryn Conley pled guilty to 24 counts of bank fraud and 4 counts of aggravated identity theft. The district court sentenced her to 30 months in prison for bank fraud and a consecutive 24 months for aggravated identity theft. On appeal, Ms. Conley argues the district court erred in relying on the loss calculation in the presentence report (“PSR“) to determine her U.S. Sentencing Guidelines (“U.S.S.G.” or the “Guidelines“) range for bank fraud. She also argues that in light of Dubin v. United States, 599 U.S. 110 (2023), the court plainly erred in accepting her guilty plea to aggravated identity theft.
Exercising jurisdiction under
I. BACKGROUND
A. Factual History
Between September 2016 and August 2021, Ms. Conley applied for loans at seven financial institutions using false employment and salary information. She sought $1,028,643.20 in loans and received $998,643.20. She used various cars, boats, and trailers as collateral.
In four instances, Ms. Conley used the names and forged signatures of financial-institution employees to create false lien releases for already encumbered vehicles. She used these lien releases to repledge the same vehicles as collateral for new loans.
B. Procedural History
A grand jury indicted Ms. Conley on 24 counts of bank fraud under
At the sentencing hearing, the district court, over Ms. Conley‘s objection, relied on the PSR‘s loss amount to calculate her Guidelines range for bank fraud as 30 to 37 months. The court sentenced her to 30 months in prison. It also sentenced her to a mandatory consecutive 24 months for aggravated identity theft,
Ms. Conley timely appealed.
II. DISCUSSION
Ms. Conley raises two issues. First, she challenges the district court‘s calculation of her Guidelines range for bank fraud. Second, she argues Dubin v. United States renders the court‘s acceptance of her guilty plea to aggravated identity theft plainly erroneous. We vacate Ms. Conley‘s sentence for bank fraud and remand for resentencing. We affirm her aggravated identity theft convictions.
A. Loss Calculation
The district court clearly erred in relying on disputed facts in the PSR to calculate Ms. Conley‘s Guidelines range for bank fraud, making her sentence procedurally unreasonable.
1. Legal Background
a. Standard of review
We review sentencing decisions for abuse of discretion. Peugh v. United States, 569 U.S. 530, 537 (2013). “When reviewing a district court‘s application of the Sentencing Guidelines, we review legal questions de novo and we review any factual findings for clear error.” United States v. Maldonado-Passage, 4 F.4th 1097, 1103 (10th Cir. 2021) (alterations and quotations omitted).
“A district court‘s loss calculation at sentencing is a factual question we review for clear error.” United States v. Griffith, 584 F.3d 1004, 1011 (10th Cir. 2009) (quotations omitted).2 “[W]e may disturb the district court‘s loss determination—and consequent Guidelines enhancement—only if the court‘s finding is without factual support in the record or if, after reviewing all the evidence, we are left with a definite and firm conviction that a mistake has been made.” United States v. Mullins, 613 F.3d 1273, 1292 (10th Cir. 2010) (quotations omitted).
“[W]e evaluate sentences imposed by the district court for reasonableness.” United States v. Conlan, 500 F.3d 1167, 1169 (10th Cir. 2007); see United States v. Booker, 543 U.S. 220, 261-62 (2005). Ms. Conley challenges only the procedural reasonableness of her sentence. “Procedural reasonableness involves using the proper method to calculate the sentence.” Conlan, 500 F.3d at 1169; see Gall v. United States, 552 U.S. 38, 51 (2007). “In setting a procedurally reasonable sentence, a district court must calculate the proper advisory Guidelines range . . . .” United States v. Chee, 514 F.3d 1106, 1116 (10th Cir. 2008) (quotations omitted); see Rosales-Mireles v. United States, 138 S. Ct. 1897, 1904 (2018).
“Any error in the Guidelines calculation renders a sentence procedurally unreasonable and, if the error is not harmless, requires remand.” United States v. Scott, 529 F.3d 1290, 1300 (10th Cir. 2008); see also Peugh, 569 U.S. at 537. When the government is the “beneficiary of the error,” it must prove harmlessness by a preponderance of the evidence. United States v. Sanchez-Leon, 764 F.3d 1248, 1262-63 (10th Cir. 2014) (quotations omitted).
c. U.S.S.G. § 2B1.1
Section 2B1.1(b)(1) increases the base offense level according to the “loss” caused by the offense.3 To calculate loss, the sentencing court must take “the greater of actual loss or intended loss,”
“Actual loss” is the monetary harm that resulted from the offense. Id.
The sentencing court then deducts (1) the amount of “money returned . . . by the defendant . . . to the victim before the offense was detected,” id.
and (2) the value of any collateral that the victim has recovered by the time of sentencing, id.
In summary, loss is the greater of actual or intended loss, less (1) the money returned before detection of the offense and
d. PSR at sentencing
Sentencing courts often rely on facts in the PSR.
At sentencing, the court:
(A) may accept any undisputed portion of the [PSR] as a finding of fact; [and]
(B) must—for any disputed portion of the [PSR] or other controverted matter—rule on the dispute or determine that a ruling is unnecessary either because the matter will not affect sentencing, or because the court will not consider the matter in sentencing . . . .
“If a defendant fails to specifically object to a fact in the PSR, the fact is deemed admitted by the defendant and the government need not produce additional evidence in support of the admitted fact.” United States v. Hooks, 551 F.3d 1205, 1217 (10th Cir. 2009). But “[w]hen a defendant objects to a fact in a [PSR]” and notifies the sentencing court that the fact is disputed, “the government must prove that fact at a sentencing hearing by a preponderance of the evidence.” United States v. Barnett, 828 F.3d 1189, 1192 (10th Cir. 2016) (quotations omitted); see
A defendant objects to a fact in the PSR by “mak[ing] specific allegations of factual inaccuracy” rather than challenging only “the ultimate conclusions in the [PSR]” or “the inferences to be drawn” from the facts. Barnett, 828 F.3d at 1192-93, 1195 (quotations omitted). “[T]he test is whether the district court was adequately alerted to the [factual] issue.” United States v. Harrison, 743 F.3d 760, 763 (10th Cir. 2014).
A sufficient objection may be “imprecise.” Id.; see United States v. E.F., 920 F.3d 682, 687 (10th Cir. 2019) (“All that is required to preserve an issue for appeal is that the party ‘informs the court of the party‘s objection and the grounds for that objection.‘” (alterations omitted) (quoting
2. Additional Procedural History
a. PSR
Ms. Conley‘s PSR calculated her loss as $1,020,591.62, which increased her base offense level by 14. An addendum to the PSR explained that this number was calculated by taking the total amount of fraudulent loans that Ms. Conley sought ($1,028,643.00) and subtracting the value of one vehicle that was returned to a victim financial institution ($8,051.38).
Ms. Conley received the draft PSR before her sentencing hearing. She filed written objections in a letter to the Probation Office, in which she objected that the loss amount had not been reduced by the amounts paid on the loans or the value of recovered collateral.
c. Sentencing hearing
At the sentencing hearing, the district court stated that it had “reviewed [Ms. Conley]‘s [written] objections” and believed that it “fully underst[ood]” the objection. ROA, Vol. III at 40.8
Ms. Conley told the court that she “maintain[ed] [her] objection with regard to the total loss for purposes of calculating the [Guidelines] enhancement on that basis.” Id. She further explained that the commentary to
The Government responded that Ms. Conley was “conflating intended loss and actual loss,” id. at 46, and argued that her false lien releases meant that the “banks could not repossess their collateral,” id. at 47. It said that “for sentencing [the court should] go by the intended loss.” Id. The Government presented no evidence in support of the PSR‘s loss calculation, and the district court did not request it. See id.
The district court overruled Ms. Conley‘s objection. It “believe[d] the intended loss [wa]s calculated correctly and . . . all amounts that were credited ha[d] been deducted from the intended loss.” Id. at 47-48. And it “d[id]n‘t think there[] [was] any way . . . to calculate the intended loss less than $550,000 based upon [the PSR],” which would be required for Ms. Conley to receive a 12-level increase to her offense level rather than a 14-level increase. Id. at 48. Finally, the court said that “for [Ms. Conley] to get credit for returned items or returned amounts . . ., she would have had to return that before detection, and that[] . . . doesn‘t seem to be the case.” Id.
The district court then decided that “the [PSR] [would] form the factual basis for [its] sentence.” Id. at 62. It calculated Ms. Conley‘s offense level as 19 with a criminal history category of I,9 which resulted in a Guidelines range of 30 to 37 months. It sentenced her to 30 months in prison for bank fraud.
3. Analysis
a. Sufficiency of objection and the Government‘s burden
The Government argues Ms. Conley‘s objections to the PSR were “insufficient to trigger the district court‘s factfinding responsibilities.” Aplee. Br. at 14. We disagree.
To determine whether her objections were sufficient, “the sole question is whether the district court was adequately alerted to the issue.” E.F., 920 F.3d at 687 (quotations omitted). Ms. Conley contested the loss amount in the PSR, insisting it did not include the appropriate deductions.
Because restitution includes only actual damages and makes deductions that are excluded from the loss calculation, see
Nonetheless, she sufficiently alerted the district court that she disputed the PSR‘s loss calculation. E.F., 920 F.3d at 687. Because her objections were sufficient under Rule 32(i)(3) and our case law, see Barnett, 828 F.3d at 1192-93; E.F., 920 F.3d at 687; Harrison, 743 F.3d at 763, the Government was required to prove the loss amount at the sentencing hearing by a preponderance of the evidence.
b. Clear error and procedural unreasonableness
The district court clearly erred by adopting the PSR‘s loss calculation over Ms. Conley‘s objection without requiring the Government to prove it by a preponderance of the evidence. “We repeatedly have held that a district court may not satisfy its obligation to make a finding as to controverted factual allegations regarding sentencing by simply adopting the PSR as its finding.” United States v. Wilken, 498 F.3d 1160, 1170 (10th Cir. 2007) (alterations and quotations omitted); see also United States v. West, 550 F.3d 952, 974 (10th Cir. 2008). Once Ms. Conley alerted the district court that she disputed the PSR‘s loss calculation, the Government was required to present evidence at the sentencing hearing to support it. See McDonald, 43 F.4th at 1095.
The district court‘s failure to hold the Government to its burden was procedurally unreasonable. “In setting a procedurally reasonable sentence, a district court must calculate the proper advisory Guidelines range . . . .” Chee, 514 F.3d at 1116 (quotations omitted); see also Rosales-Mireles, 138 S. Ct. at 1904 (“District courts must begin their analysis with the Guidelines and remain cognizant of them throughout the sentencing process.” (alterations and quotations omitted)). To do so, it cannot rely on a disputed loss calculation that the Government failed to prove by a preponderance. See Harrison, 743 F.3d at 763-64. The court clearly erred in relying on unproven facts in the PSR, and it therefore abused its discretion by “selecting a sentence based on clearly erroneous facts.” Gall, 552 U.S. at 51.
c. Harmlessness
The district court‘s error in relying on the PSR‘s loss amount to calculate Ms. Conley‘s Guidelines range was not harmless. A calculation error may be harmless if the district court nonetheless considers the correct Guidelines range. See Kristl, 437 F.3d at 1055; United States v. Tom, 494 F.3d 1277, 1282 (10th Cir. 2007). The court did not do so here.
At the close of the sentencing hearing, the district court said it would have reached the same Guidelines range even if it made the additional deductions urged by Ms. Conley. It said that it “d[id]n‘t think there[] [was] any way to calculate the intended loss less than $550,000 based upon [the PSR],” which would have been required to increase Ms. Conley‘s base offense level by 12 rather than 14. ROA, Vol. III at 48. But this statement is “without factual support in the record.” Mullins, 613 F.3d at 1292 (quotations omitted); see United States v. Wieck, No. 19-6075, 2021 WL 4949177, at *10-11 (10th Cir. Oct. 25, 2021) (unpublished) (remanding for resentencing when the district court made the unsupported finding that even with “a liberal deduction . . ., you‘re still left with a net number in excess of 550,000“).
The Government failed to prove by a preponderance of the evidence that the properly calculated loss would still be above $550,000. See Sanchez-Leon, 764 F.3d at 1262-63. “[A] procedural error is not harmless if it requires us to speculate on whether the court would have reached the same determination absent the error.” United States v. Gieswein, 887 F.3d 1054, 1062 (10th Cir. 2018) (quotations omitted). Without record evidence supporting the PSR‘s loss calculation, we cannot say that the district court‘s error was harmless. We vacate Ms. Conley‘s sentence for bank fraud and remand for resentencing on those counts.10
B. Aggravated Identity Theft
As described above, Ms. Conley pled guilty to aggravated identity theft. She now argues the district court plainly erred in finding a factual basis for her plea after Dubin. We affirm.
1. Plain Error Standard of Review
Ms. Conley did not object to the court‘s acceptance of her aggravated identity theft plea, so we review for plain error. United States v. Olano, 507 U.S. 725, 730 (1993). “Plain error occurs when there is (1) error, (2) that is plain, which (3) affects substantial rights, and which (4) seriously affects the fairness, integrity, or public reputation of judicial proceedings.” United States v. Gonzalez-Huerta, 403 F.3d 727, 732 (10th Cir. 2005) (en banc) (quotations omitted).
An error is plain when it is “clear or obvious under current, well-settled law” at the time of appeal, meaning “either the Supreme Court or this court [has] addressed the issue.” United States v. Brooks, 736 F.3d 921, 930 (10th Cir. 2013) (quotations omitted). “[I]n certain circumstances, the weight of authority from other circuits may make an error plain . . . .” United States v. Hill, 749 F.3d 1250, 1258 (10th Cir. 2014) (quotations omitted).
2. Legal Background
a. Factual basis for a guilty plea
To enter judgment on a guilty plea, the court must determine there is an appropriate factual basis for the plea.
b. Title 18 U.S.C. § 1028A: Aggravated identity theft
Whoever, during and in relation to any felony violation enumerated in [
18 U.S.C. § 1028A(c) , including bank fraud], knowingly transfers, possesses, or uses, without lawful authority, a means of identification of another person, shall, in addition to the punishment provided for such felony, be sentenced to a term of imprisonment of 2 years.
A signature is a “means of identification” for § 1028A. United States v. Porter, 745 F.3d 1035, 1042-43 (10th Cir. 2014).
c. Dubin v. United States
In between Ms. Conley‘s sentencing and this appeal, the Supreme Court decided Dubin v. United States, 599 U.S. 110 (2023). In Dubin, the Court resolved a circuit split over when a defendant “uses” another‘s identification “in relation to” a predicate offense under
The Court held that ”
3. Analysis
Ms. Conley argues the district court plainly erred in accepting her plea under Rule 11(b)(3) because her use of the employees’ signatures to create fake lien releases was not at the “crux” of her fraud and thus, in light of Dubin, was not factually sufficient to constitute aggravated identity theft. Aplt. Br. at 25-27.
Any error here was not plain. Under the second prong of plain error review, we will reverse a district court‘s decision only if it is “contrary to well-settled law” at the time of the appeal. United States v. Whitney, 229 F.3d 1296, 1309 (10th Cir. 2000). Accepting Ms. Conley‘s plea was not contrary to well-settled law. Neither (1) the Supreme Court, (2) our circuit, nor (3) any other circuit has addressed the issue presented in Ms. Conley‘s case.
First, since Dubin, the Supreme Court has not applied its crux test or provided further guidance on how to do so. And the facts in Dubin differ significantly from those here. 599 U.S. at 114. Mr. Dubin treated the patients that he named in his reimbursement requests, changing only the amount of the reimbursement. Id. The Court relied on the distinction between ”how and when services were provided . . . [and] who received the services.” Id. at 132. By contrast,
Second, this circuit has applied Dubin‘s test only once in an unpublished decision, noting without explanation that the government met its burden to show a forged signature was “used in a manner that is fraudulent or deceptive” and “play[ed] a key role” in the crime. United States v. Herman, Nos. 22-8057, 22-8061, 2023 WL 6861766, at *8 n.6 (10th Cir. Oct. 18, 2023) (unpublished) (quoting Dubin, 599 U.S. at 129, 132). Herman does not settle the law. Unpublished decisions are not precedential. 10th Cir. R. 32.1; see also United States v. Story, 635 F.3d 1241, 1248 (10th Cir. 2011) (finding “no controlling circuit . . . precedent” where neither of the relevant cases were “published or binding on this court or the district courts“).
Further, Herman involved a scheme to “control[] a publicly traded company, artificially inflat[e] the value of the company‘s shares, and then sell[] [the] shares.” 2023 WL 6861766, at *1. The defendant used a forged signature to create a “fake attorney-opinion letter.” Id. at *2. We did not explain why this letter was at the “crux” of the defendant‘s criminal conduct or what evidence the government presented at trial to show the signature “play[ed] a key role” in the scheme. Id. at *8 n.
Third, as for other circuits, only the Eleventh and Fifth Circuits have applied Dubin‘s test. The Eleventh Circuit did so in United States v. Gladden, 78 F.4th 1232 (11th Cir. 2023), which, like Dubin, was a healthcare fraud case that bears little factual resemblance to Ms. Conley‘s case. See id. at 1238-40, 1248. The Fifth Circuit applied Dubin to find that a defendant who forged employment paperwork was properly convicted of aggravated identity theft. United States v. Croft, Nos. 21-50380, 22-50659, 2023 WL 8292809 (5th Cir. Dec. 1, 2023). Neither case supports Ms. Conley‘s argument. And two opinions from our sister circuits do not constitute “the weight of authority from other circuits” needed to establish plain error. Hill, 749 F.3d at 1258.
Neither “the Supreme Court [n]or this court [has] addressed the issue” presented in Ms. Conley‘s case, Brooks, 736 F.3d at 930, and no other circuit court has applied Dubin‘s test to bank fraud. Without more definitive legal authority, any error in accepting Ms. Conley‘s guilty plea cannot be plain. We affirm.
III. CONCLUSION
We vacate Ms. Conley‘s sentence for bank fraud and remand for resentencing on her bank fraud convictions. We affirm her convictions for aggravated identity theft.11