331 F.3d 1216 | 11th Cir. | 2003
Before BIRC H, DUB INA and K RAVIT CH, Circuit Judges. BIRCH, Circuit Judge:
We hereby VACATE our prior opinion in this case, filed on 12 March 2003, and substitute this opinion in its place. In this cas e, an app eal of con viction an d senten ce of certain federa l mail fraud offenses relating to the distribution of pharmaceuticals, we consider the proper loss calculation under U.S .S.G. § 2F1.1 w hen a defendant wh o possesses a restricted right to distribute a product fraudulently diverts that product to non- authorized buyers. We find that the appropriate focus of the loss calculation is the marginal value of the unrestricted right to distribute over the restricted right, and we find that a reasonable estimate of this value is the profit obtained by the defend ant from non-au thorized sales. In ad dition, w e consid er the arg ument th at, in a conspiracy of two people, only one person’s sentence may be enhanced for playing a leadership role in the offense. Rejecting this assertion, we find that each participant can be sentenced as a leader assuming that both exercise authority and control over a distinct portion of the criminal activity. On these and related issues, we AFFIRM .
I. BACKGROUND
David Neal Yeager worked as the vice president of sales and marketing for Respiratory Distributors, Inc. (“Distributors”), a small compan y located in Foley, Alabama, whose business it was to distribute prescription drugs at wholesale prices to pharmacies or other outlets. Richard Po well, the owner of D istributors, also owne d Resp iratory D ruggist, I nc. (“Dr uggist”) , a mail-or der pha rmacy th at sold prescription drugs directly to home health patients.
Misrepresenting himself as a vice president for Druggist, Yeager contacted Boehringer Ingelheim Pharmaceuticals, Inc. (“BIPI”) in March 1996 to negotiate a contract for Druggist to sell Atrovent®, a prescription drug for the treatment of respiratory conditions created and manufactured by BIPI, to Druggist’s home health patients. Yeager negotiated the contract without the immediate knowledge of Powell. Under the terms of the contract, BIPI would supply Atrovent at $28.78 per box. BIPI offered Druggist this low price on Atrovent based on the understanding that it would only be resold to Druggist’s home health patients, and not to other pharmacies or w holesalers.
To ensure that Druggist sold only to its home health patients, BIPI required Druggist to submit both an initial utilization report and supplemental reports every month thereafter, which would list detailed information about all patients receiving Atrov ent throu gh Dr uggist. B ased on these utiliza tion repo rts, BIP I wou ld determin e the pro per amo unt of A trovent to ship. U nder the contract, B IPI cou ld immediately terminate its relationship with Druggist if these reports were not filed or if any A trovent w as diverte d to non -home health pa tients.
Pow ell conten ds he w as unaw are until S eptemb er 1996 that any of his companies had a contract with BIPI for the distribution of Atrovent. Throughout this time period and despite the restricted distribution contemplated under the contract w ith BIP I, Yeag er repeate dly diver ted large s hipmen ts of Atr ovent to unauthorized buyers. These shipments were sent to the unauthorized buyers by interstate co mmerc ial carrier. Durin g the relev ant perio d, the gro ss profit to Powell’s corporations from these sales was $687,000. BIPI itself marketed Atrov ent to w holesale d istribution compa nies, like D istributor s, at a price g enerally higher th an the D ruggist c ontract p rice. The crux of the fraud ulent con duct in th is case was that Yeager ob tained Atrovent at the low price offered under the Drugg ist contract a nd then diverted the prod uct to D istributor s. Distrib utors the n re-sold Atrovent at a market advantage, effectively undercutting BIPI’s own distribution scheme.
Both the initial utilization report and the monthly utilization reports required under the contract were not submitted. By January 1997, BIPI was concerned about the reporting failures and suspected that diversion of Atrovent was occurring. In March 1 997, a representative of BIPI co ntacted Powell to discuss BIPI’s concerns and to insist on the prompt and proper disclosure of patient information. Following this contact, Yeager and Powell agreed to continue the extremely profitable deception of BIPI by submitting false and fraudulent utilization reports containing the type of information that BIPI had requested. Yeage r prepar ed and submitted the repo rts to BIP I. Both Y eager an d Pow ell instructed employees of Distributors and Druggist in conduct designed to conceal their sche me – fo r examp le, by answ ering the shared telephon e line as “R DI” to draw attention away from the Distributors operation.
In June 1997, unsatisfied with the reports, BIPI requested an on-site audit of the facilities in Foley, Alabama. Yeager and Powell were both present for and participants in the audit. The documents obtained by BIPI representatives during the audit were continuations of the Druggist/Distributors shell game; in the words of a BIPI representative, the documents were “worthless.” R3 at 150. Pow ell ordered employees to set up rows of empty boxes in the warehouse, with boxes of Atrovent only on top, to give the appearance that their on-hand inventory of Atrovent was much larger than in reality to create the impression that Atrovent was not being diverted to other purchasers. Powell testified at trial that, had he and Yeager turned over the true inventory records, their scheme would have been revealed. Yeager planned the BIPI visit and ensured that employees followed the instructions designed to deceive the visitors.
After the audit, Yeager continue to remit utilization reports that did not contain accurate and complete information for the patients to which Druggist was supposedly distributing Atrovent. BIPI learned in December 1997 that the FBI was conducting a criminal investigation related to the Atrovent sales, and BIPI terminate d its relation ship w ith Dru ggist/D istributor s the follo wing m onth.
Both Y eager an d Pow ell were in dicted fo r their use of the m ail system to further their fraudulent scheme. Yeager refused to cooperate with federal authorities and put the government to its proof. Powell pled guilty pursuant to a written plea agreement, under which he is currently serving approximately one year in prison. He cooperated with federal authorities in the investigation and testified against Yeager during a three-day trial in August 2001. A unanimous jury found Yeage r guilty on seven co unts of m ail fraud, in violation of 18 U .S.C. § 1341, based on seven shipments of Atrovent diverted by Yeager from August 1996 to Aug ust 199 7 to una uthorize d custom ers throu gh the m ail, and of conspir acy to commit mail fraud, also in violation of 18 U.S.C. § 1341. The district court sentenced Yeager to 33 months in prison, followed by three years of supervised release, and ordered that Yeager be jointly and severally liable with his co- conspir ator Po well for the paym ent of $6 87,000 in restitutio n to BIP I.
II. DISCUSSION
A. Sufficiency of Evidence for Mail Fraud Conviction Yeager argues that the evidence presented at trial cannot sustain his fraud
conviction because the government failed to prove that BIPI reasonably relied on his misrepresentations. He argues that the misrepresentations made could have been easily confirmed false if BIPI had felt the need to investigate their veracity, and that BIPI’s failure to do so precludes his conviction under the mail fraud statute. According to Yeager, BIPI wanted to flood the market and make as much profit as possible from Atrovent, because that drug was soon losing its patent protectio n. Thu s, BIPI did not c are wh ether D istributor s/Drug gist was adherin g to the terms of the distribution contract by selling only to home health patients and could n ot have r easonab ly relied on any false in formatio n prov ided by Y eager as to the customer list. The government argues that reasonable reliance is not required to be pro ved for convictio n.
We review de novo the legal q uestion o f wheth er sufficie nt eviden ce exists in the reco rd to sup port a gu ilty verdict. United States v. Tinoco, 304 F.3d 1088, 1122 ( 11th C ir. 2002 ), petition for cert. filed (U.S. D ec. 2002 ) (No. 0 2-786 8). “When condu cting the review of the record, w e view the evidence in the light most favorab le to the go vernm ent and r esolve all r easonab le inferen ces and c redibility evaluations in favor of the jury’s verdict.” Id. (quoting United States v. To, 144 F.3d 7 37, 743 (11th C ir. 1998 )). The v erdict w ill be uph eld unles s no reas onable jury cou ld have f ound g uilt beyon d a reaso nable do ubt. Id.
Under 18 U.S.C. § 1341, a person who, having devised a scheme to defraud, mails any matter through the Postal Service or any commercial interstate carrier for the purpose of furthering or ac complishing that scheme, comm its a federal offense punishable by fine and up to five years of imprisonment. The federal mail fraud statute prohibits the use of the mail to further “scheme[s] . . . to defraud.” 18 U.S.C . § 1341 . The us e of the m ail to furth er these sc hemes is a distinct ev il punish able wh ether or n ot the sch eme resu lts in com pleted co mmon -law fra ud. Because the statute prohibits the “scheme to defraud,” the government is not required to prove all of the elements of completed common-law fraud to sustain a convictio n. Neder v. United States, 527 U.S. 1, 24-25, 119 S. Ct. 1827, 1841 (1999 ).
The Supreme Court in Neder identified materiality a s a necess ary eleme nt, and said in dicta that “[t]he common-law elements of ‘justifiable reliance’ and ‘damages,’ for example, plainly have no place in the federal fraud statutes.” 527 U.S. at 24-25, 119 S.Ct. at 1841. We have stated previously that proof of actual reliance b y the victim and pro of of da mages a re not req uired, United States v. Brown, 79 F.3d 1550, 1557 n.12 (11th Cir. 1996) (citing Pelletier v. Zweifel, 921 F.2d 1465, 1498 (11th Cir. 1991), but we have never clearly stated that proof that the victim reasonably relied on the misrepresentation is unnecessary. In fact, our decision in Brown can be re ad to ho ld the op posite: tha t “a ‘schem e to defra ud’ . . . has not been proved where a reasonable juror would have to conclude that the represen tation is ab out som ething w hich the [ victim] sh ould, an d could , easily confirm – if they wished to do so – from readily available external sources.” 79 F.3d at 1 559.
The argument that proof of reasonable reliance is unnecessary has a logical appeal: if it is true, as we have held, that the government is not required to prove the actual reliance of the victim on the defendant’s misrepresentations, then it does not make sense to require the government to prove that the non-required reliance was reasonable. On the other hand, the elements of reasonable reliance and materiality analytically overlap; both concern the expected effectiveness of the misrepr esentation s, and it is d ifficult to d escribe p recisely w hich elem ent is fulfilled b y differen t forms o f proof and arg ument.
As Yeager presents the reasonable reliance element, it requires proof that the particular victim in this case, armed with his or her own knowledge and experience with the situation, did not and could not easily disprove the misrepresentations throug h access to held or r eady info rmation . Reason able relian ce, thus, is in this construct a subjective requirement that turns on the particularized response of the actual victim. The Supreme Court in Neder quoted the Restatement (Second) of Torts § 538 (1 977) to define a m aterial matte r funda mentally a s an obje ctive test – as one that “a reasonable man would attach importance to its existence or nonex istence in d eterminin g his cho ice of actio n in the tra nsaction at questio n.” 527 U .S. at 21 n .5, 119 S .Ct. at 184 0 n.5. T he prob lem, as in m ost attemp ts to apply an objective test, is in determining how many of the victim’s peculiar characteristics to impute to the hypothetical reasonable man. The more characteristics we impute, and we seem to impute quite a few characteristics here in the Eleventh Circuit, the closer the materiality element approaches the suppo sedly distin ct elemen t of reaso nable relia nce.
While it might be possible to extricate distinct analytical principles from both elements and, then, determine the exact extent of necessary proof for federal fraud ca ses in gen eral, it is not n ecessary to do so in this specif ic case. Fir st, Yeager’s defense at trial is better cast as a challenge to BIPI’s actual reliance on the misrepresentations. Yeager’s defense challenges the idea that BIPI ever relied on the false customer lists – according to Yeager, BIPI never cared about the customer lists because it was motivated solely by the idea of profits before Atrovent’s patent expired. This argument does not challenge whether BIPI, having accepted the misrepresentations, did so reasonably. It questions whether BIPI ever accepted the misre presenta tions in th e first place , that is, wh ether BI PI actua lly relied on the misre presenta tions. W e have cle arly held, h owev er, that actual reliance h as no pla ce in a pro secution for fede ral mail fra ud. Pelletier, 921 F.2d at 1498.
Second, assuming that Yeager’s concept of reasonable reliance is required as a necessary element of federal mail fraud, and assuming that his defense at trial qualifies a s a challen ge to reas onable r eliance, su fficient ev idence o f reason able reliance was entered at trial. BIPI’s efforts to monitor the distribution of Atrovent under its contract with Druggist constituted reasonable reliance on the misrepresentations made by Yeager in the course of the scheme to defraud. On- site audits and requests for corrected and complete information by BIPI were deflected by active deception by Yeager. The type of information misrepresented, including the lists of patients to whom Druggist was supplying Atrovent, was not easily obtainable by BIPI from another source. We find BIPI’s efforts to be reasonable, rep eated attempts to v erify the accuracy of Yeage r and Dru ggist’s represen tations, an d the com mon law definition of fraud does no t require th em to undertake the type of rigorous investigation necessary to pierce the facade presente d by the d efendan t. See, e.g., Restatement (Second) of Torts §§ 540, 541 (1977 ).
B. Jury Instructions Yeager also argues that the district court erred by failing to give to the jury
his preferred instruction on the requirement of reasonable reliance. “We review a district court’s refusal to give a particular jury instruction for abuse of discretion.” United States v. C ornillie, 92 F.3d 1108, 1109 (11th Cir. 1996) (per curiam). The failure of a district co urt to giv e an app ropriate in struction is reversib le error where the requested instruction “(1) was correct; (2) was not substantially covered by the charge actually given; and (3) dealt with some point in the trial so important that failure to g ive the req uested in struction seriously impaired the defen dant’s ab ility to conduct his defense.” United States v. C hastain, 198 F.3d 1338, 1350 (11th Cir. 1999) , cert. denied sub nom. Morris v. United States, 532 U.S. 996, 121 S.Ct. 1658 (2001).
Yeager’s requested instruction provided, in relevant part, that A scheme to defraud h as not be en prov ed wh ere reaso nable jurors would have to conclude that the representation is about something which the alleged victim, Boehringer, should, and could, easily confirm – if it wished to do so – from readily available sources including inform ation it should, and could, easily have obtained from the defendant in a timely fashion as specifically set forth in the executed agreem ent.
R1-42. The district court rejected Yeager’s proposed instruction, explaining that the topic was substantially and correctly covered by its preferred charge, drawn from th e Eleven th Circu it’s Pattern Jury Ins tructions .
First, procedurally, though Yeager did object after the district court refused his proposed instruction, the grounds for objection were only that the district court mistakenly believed that the instruction was an incorrect statement of the law, R6 at 784 (“I think it’s an accurate statement of the law.”), and that Yeager preferred the langu age he u sed in the instructio n, id. (“I like, Judge, the way [Brown] wrote it.). The d istrict cour t, howe ver, also r efused th e instructio n on the basis that its subject matter was duplicative of the other instructions given: “I think the charge – I don’t k now th at it really heig htens the standard , but I do n’t think it’s necessar y to give it.” Id. The argument surrounding Yeager’s proposed instruction focused on the perceived need to tell the jury that “the person or the victim has to be viewed – that the vic tim is to be viewed as a perso n of ord inary pru dence an d a reaso nable person.” Id. at 781. T he district c ourt po inted to th e standar d materia lity instruction, which stated that “a material fact is a fact that would be important to a reasonable person in deciding whether to engage or not engage in a particular transactio n,” in dec laring Y eager’s su ppleme ntary instr uction u nnecessary. Id. at 780-81. Yeager did not object or respond to this ground for refusal, and his failure to do so should remov e this issue from th e realm o f those v alidly hear d on ap peal. See United States v. Gallo-Chomorro, 48 F.3d 502, 507-08 (11th Cir. 1995) (“To preserve an issue for appeal, a general objection or an objection on other grounds will not s uffice.”); United States v. D ennis, 786 F.2d 1029, 1042 (11th Cir. 1986) (“To preserve an issue at trial for later consideration by an appellate court, one must raise an objection that is sufficient to apprise the trial court and the opposing party of th e particula r groun ds upo n whic h appella te relief w ill later be so ught.”).
In addition and as discussed supra, Yeage r’s defen se seeks to create reasonable doubt as to BIP I’s actual reliance o n the mis represen tations. H is argument essentially is that BIPI did not actually rely on any of the customer information sent by Distributors/Druggist, and this argument, presented by evidence throughout the course of the trial and specifically highlighted by counsel for Yeager in closing argument, was rejected by the jury, given their unanimous vote to co nvict. Ev en if we found that Yea ger properly pre served h is objectio n to the instru ctions, an d even if we fou nd the ju ry instruc tions did not suff iciently inform the jury o f their req uiremen t to find re asonab le reliance, w e wou ld find th is error ha rmless, as it did not p rejudice Y eager’s ab ility to prese nt his def ense. Yeager was permitted to argue his theory of defense, that Boehringer knew that Yeager would be selling as much Atrovent as possible to as many people as possible , and that B oehring er knew and app roved o f the Dis tributors /Drug gist shell game, th rough evidenc e presen ted durin g trial and throug h his clos ing argu ment. See R6 at 820-831. The jury could have accepted this defense and acquitted Yeage r by refer ence to th e instructio ns, particu larly the m ateriality instr uction. Therefore, we can find no error in the refusal of the reasonable reliance instruction.
C. Loss Enhancement Turning to Yeager’s sentencing following his conviction at trial, Yeager
argues that the district court improperly enhanced his sentence based on the amount of gain flowing from his fraudulent conduct without first making the preliminary determination that some loss accrued from the conduct. Although we generally review the district court’s interpretation of the United States Sentencing Guidelines de novo, the loss ca lculation a t the heart o f U.S.S .G. § 2F 1.1 [1] is a factual de terminatio n that w e review for clear e rror. United States v. Toussaint, 84 F.3d 1 406, 14 07 (11 th Cir. 19 96).
Under the 2000 Guidelines, the base offense level for offenses involving fraud is 6; this base offense level is increased up to 18 levels based on the amount of loss o ccasione d by the fraud. See U.S.S.G. § 2F1.1(a), (b) (2000). [2] Gener ally speaking, “[l]oss is the value of the money, property, or services unlawfully taken.” U.S.S .G. § 2F 1.1 com ment. (n .8). Los s, as und erstood under th e Guid elines, is often no t calculable with pr ecision; th erefore, w e require the district c ourt on ly “make a reasonable estimate of the loss, given the available information.” U.S.S.G. § 2F1.1 comment. (n.9). The court, however, cannot merely speculate as to the pro per amo unt of lo ss, United States v. Sepulveda, 115 F .3d 882 , 890 (1 1th Cir. 1997), and, if the amount suggested by the government is contested, the government must support its estimate with “reliable and specific evidence.” United States v. Renick, 273 F.3d 1009, 1025 (11th Cir. 2001) (per curiam).
Yeager contends that the district court did not and could not find that BIPI suffered a loss fro m his fra udulen t condu ct, because BIPI made a s ubstantia l profit from the sale of Atrovent to Druggist. The government responds, and the district court acc epted, tha t BIPI lo st profit fr om Y eager’s d iversion : Yeage r wron gfully sold Atrovent to non-authorized customers, using the low contract price from BIPI to bolster sales, and BIPI was denied the opportunity to sell Atrovent through establishe d chann els to these non-au thorized custom ers at a hig her price . However, the district court found itself unable to reasonably estimate this loss, based u pon co nflicting a nd con fusing a ccounts at trial by ex perts w ho attem pted to quantify the prof it shortfall.
Instead, the court found that Yeager, the defendant, and Powell, the owner of Drug gist and D istributors, gained $687,0 00 for th ose corp orations by their p ursuit of the scheme to defraud, and the court used this gain as a proxy for loss for purposes of sentencing. The $687,000 figure represents the profit made by the corporations by selling Atrovent to non-authorized customers during the relevant conspiratorial time period – the difference between the price at which Atrovent was obtained under the legitimate contract with BIPI, and the price at which Yeager sold Atrovent to non-au thorized customers.
To analyze whether the district court was correct in its sentencing determinations, we initially must decide whether BIPI suffered any “loss,” as that term is understood under the Guidelines, from Yeager’s conduct. “[L]oss is the value of the mon ey, prop erty, or ser vices un lawfully taken.” U .S.S.G . § 2F1 .1 comm ent. (n.8) . Yeage r argues that BIP I made a substan tial profit o ff of its relationship with Druggist/Distributors, and any loss identified by the government is oppo rtunity-co st loss, loss based o n the victim ’s inability to use mo ney or as sets in a more profitable way becau se of the perpetrated fraud. Opp ortunity-cost loss may not be considered at sentencing: “[Loss] does not, for example, include interest the victim could have earned . . . had the offense not occurred.” Id.
What “m oney, pr operty, o r services ” were “u nlawfu lly taken” b y Yeag er in this case? Though the government intimates that we should focus on the value of the diverted drugs themselves in estimating the loss, we think that a more proper focus would be on Yeager’s “theft” of distribution privileges. BIPI granted Drug gist the res tricted righ t to distribu te Atrov ent and c harged Drug gist a certain price per box for that privilege. Yeager fraudulently diverted Atrovent to other purcha sers, effec tively con verting th e restrictive distributio n license f rom B IPI into an unrestricted distribution license. Abstracted out, Yeager took the unrestricted right to distribute Atrovent. This right obviously has some value, and we agree with the district court that BIPI suffered an actual loss under the Guidelines based on the “th eft” of this right. Th e loss calcu lation, ther efore, sh ould be an attemp t to determine the value of the purloined portion of the distribution right – the addition al benefit o f unrestr ained dis tribution stolen by Yeage r throug h fraud .
The value of an unrestricted distribution right is the difference between the cost at w hich a dis tributor c an obtain a produ ct and the price at w hich he c an re-sell that prod uct on th e marke t as a wh ole. The value of a restricted distributio n right is the difference between the cost at which a distributor can obtain the product and the price at which he can re-sell that product to the restricted market. Therefore, the marginal value of the unrestricted distribution right over the restricted distribution right is the price differential between the open market and the restricted m arket.
It was not clear error for the district court to accept the profit made by Distributors through unrestricted sale of Atrovent during the time of the conspiracy as a reaso nable estim ate of the m arginal v alue of th e purloin ed right. [3] Distributors’ profit would be expected to correlate with the profit BIPI could have made through its own sales of A trovent to these no n-autho rized pu rchasers .
Though we perhaps approach the issue in a manner different than the district court, in that we use the $687,000 figure as a direct estimate of the value of the proper ty taken th rough fraud, ra ther than as an estim ate of gain from th e schem e to be used as a prox y for suc h value, w e canno t fault the re sult at sente ncing. W e agree with the district court that the loss involved in this case was not merely an opportunity-cost loss but rather was a definite loss for which sentencing adjustments are appropriate, and, further, we agree that $687,000, the amount of profit obtained through sales of Atrovent on the unrestricted market by Distributors, is a r easonable estim ate of the loss inflicted on BIP I through Y eager’s fraudu lent cond uct. Acc ording ly, we fin d that the d istrict cour t did not e rr in imposing a sentencing enhancement based on a loss calculation of $687,000.
D. Role Enhancement Yeager argues that the government failed to prove that he exercised any
influence or control over another participant in the conspiracy and that, therefore, his sentence cannot be increased for playing an aggravating role under the Guidelines. According to Yeager, because only he and Powell were indicted for the conduct at issue, and because Powell had already received a role enhancement for his involvement, it is inconceivable that Yeager also could be eligible for the enhanc ement.
We rev iew the s entencin g court’s factual fin dings fo r clear erro r and its application of the sentencing guidelines to those facts de novo. United States v. Humber, 255 F.3d 1308, 1311 (11th Cir. 2001). The government bears the burden of proving by a preponderance of the evidence that the defendant had an aggrav ating role in the off ense. United States v. Alred, 144 F .3d 140 5, 1421 (11th Cir. 199 8).
Unde r the Gu idelines, a f our-lev el increase in the app licable off ense leve l is appropriate if the defendant “was an organizer or leader of a criminal activity that involve d five or more p articipants or was otherw ise extens ive.” U.S .S.G. § 3B1.1(a). If the defendant was a “manager or supervisor (but not an organizer or leader) and the criminal activity involved five or more participants or was otherw ise extens ive,” then the offen se level sh ould be increased by three. Id. at (b). When the defendant is “an organizer, leader, manager, or supervisor” in any other criminal activity (that is, any criminal activity not involving five or more participan ts and no t extensiv e), then h is offens e level sho uld be in creased b y two. Id. at (c). The district court imposed the two-level § 3B1.1(c) enhancement on Yeager.
Accor ding to th e comm entary, “[t]o qualify fo r an adju stment u nder this section, the defendant must have been the organizer, leader, manager, or supervisor of one or more other participants.” U.S.S.G. § 3B1.1 comment. (n.2). Yeager latches onto this commentary as support for his argument that, in a conspiracy of two people, only one can be sentenced for a leadership role. However, we do not think this argum ent flow s from th e comm entary. W hen a co nspiracy involve s only two participants, each participant can be a “organizer, leader, manager, or supervisor” in the criminal conduct when each participant takes primary responsibility for a distinct component of the plan and exercises control or influence over the other participant with respect to that distinct component of the plan. The record is replete with instances from which the district court could have conclud ed that Y eager directed or o rganized or led P owell in the cond uct of cer tain elements of the criminal scheme. Even more telling, the record indicates that Yeager directed other employees of Druggist and Distributors to undertake tasks designed to further the scheme.
In additio n, the fact th at Pow ell may ha ve receiv ed an ad justmen t at his sentencing does not require us to depart from an independent consideration of the propriety of an enhancem ent for Yea ger. We are quite sure that Y eager’s participation in the scheme, as proved at trial, highlights the leadership role he played in the plan to defraud BIPI, r egardles s of the re sult of P owell’s s entencin g. We find no error in the district court’s imposition of a two-level enhancement based o n that lead ership ro le.
E. Restitution Order Finally, Yeager contends that the district court imposed a restitution order
without any evidence of an identifiable victim who suffered loss or any finding that Yeage r had the ability to pa y. A distr ict court’s r estitution o rder is ge nerally reviewed for abuse of discretion, but the legality of that order is reviewed de novo. United States v. D avis, 117 F.3d 459, 462 (11th Cir. 1997). As we have discussed, there is evidence of a loss suffered by BIPI and attributable to Yeager’s fraudulent conduct. Accordingly, we find no merit in Yeager’s argument that there was no identifiable victim on which to predicate a restitution order.
As to Y eager’s ar gumen t that the dis trict court e rred by f ailing to tak e into account his ability to pay restitution, we note that restitution is mandatory, without regard to a defendant’s ability to pay, when the crimes of conviction are fraud- or deceit-ba sed offe nses un der Title 1 8 of the U nited Sta tes Cod e. 18 U.S .C. § 3663A . Yeage r was co nvicted o f mail frau d and co nspiracy to comm it fraud in violation of 18 U.S.C. §§ 1341 and 1343, and these offenses are of the type for which mandatory restitution is appropriate under § 3663A. Therefore, the district court did not err in failing to take Yeager’s financial situation into account before ordering restitution.
III. CONCLUSION
We co nclude th at the gov ernmen t submitte d adequ ate proo f of reaso nable reliance to sustain Yeager’s conviction, and that Yeager failed to properly preserve the grou nds for his objec tion to the refusal o f the reaso nable relia nce instru ction. In additio n, we fin d that the p rofits ma de on th e open m arket are a reasona ble estimate of the value of a stolen right to unrestricted distribution; therefore, Yeager’s challenge of the loss calculation under U.S.S.G. § 2F1.1 fails. The district court also did not err by imposing a role enhancement and restitution order. Based on the foregoing discussion, we find no error in Yeager’s conviction or sentencing. We AFFIRM .
NOTES
[1] Under the current version of the Guidelines, § 2F1.1 has been incorporated into § 2B1.1.
[2] The district court used the 2000 edition of the Sentencing Guidelines to sentence Yeager, given the ex post facto concerns inherent in applying more recent versions. The general rule is that a defendant is sentenced under the version of the Guidelines in effect on the date of sentencing, barring any ex post facto concerns. United States v. Bailey, 123 F.3d 1381, 1403 (11th Cir. 1997). Yeager, sentenced on 20 February 2002, would have been sentenced under the 2001 Guidelines, including those amendments made effective on 1 November 2001. Under the 2001 Guidelines, the calculated loss would result in a 14-level enhancement of Yeager’s offense level, compared to the 10-level enhancement arising under the 2000 Guidelines, the version in effect during the commission of the criminal conduct at issue. This increased penalty after the commission of the offense raises ex post facto concerns which were properly addressed by the district court’s use of the 2000 Guidelines version. Therefore, all citations to the Sentencing Guidelines herein are to the 2000 version unless specifically noted.
[3] Accepting the gross profit from unauthorized sales as an estimate of the marginal value of the unrestricted distribution right presumes that the value of Atrovent on the restricted market is very low or zero. In this case, the restricted market (Druggist’s legitimate home health patients) could absorb only a certain amount of Atrovent. After the exhaustion of legitimate patients, the value of Atrovent on the restricted market is zero; there are no customers remaining to whom Druggist legitimately could sell Atrovent at any price. Therefore, the marginal value of the unrestricted right to distribute, or, at least, a reasonable estimate of the value based on the evidence presented to the district court, is the entire profit made by Yeager/Distributors on the open market, with a set-off of zero representing the value of Atrovent on the exhausted restrictive market.
