United States v. GadsonUnited States v. Gadson
[Hon. Jon D. Levy, U.S. District Judge]
Chauncey B. Wood, with whom Danya F. Fullerton and Wood & Nathanson, LLP were on brief, for appellant.
Benjamin M. Block, Assistant United States Attorney, with whom Darcie N. McElwee, United States Attorney, was on brief, for appellee.
KAYATTA, Circuit Judge. Bernard Gadson was sentenced to 110 months’ imprisonment after pleading guilty to crimes arising from his role in a bank fraud scheme. On appeal, he challenges the procedural reasonableness of his sentence, asserting that the district court miscalculated the appropriate Guidelines sentencing range. He also challenges the inclusion of certain amounts in the court‘s restitution order. For the following
I.
We begin by summarizing the factual background and procedural history that form the basis of Gadson‘s appeals. “Because [Gadson pleaded] guilty, we draw the relevant facts from the change-of-plea colloquy, the unchallenged portions of the Presentence Investigation Report (‘PSR‘), and the sentencing hearing transcript.” United States v. González-Andino, 58 F.4th 563, 565 (1st Cir. 2023) (quoting United States v. Díaz-Rivera, 957 F.3d 20, 22 (1st Cir. 2020)).
On October 25, 2021, Gadson pleaded guilty to three crimes stemming from his involvement in a bank fraud conspiracy: (i) attempted bank fraud, in violation of
The district court sentenced Gadson to 110 months’ imprisonment. In determining the total offense level for bank fraud and criminal contempt (which were grouped together under the applicable United States Sentencing Guidelines), the court added twelve levels under section 2B1.1 for the monetary losses associated with Gadson‘s conduct, including losses stemming from uncharged relevant conduct. See United States v. Flete-Garcia, 925 F.3d 17, 28 (1st Cir. 2019). Pursuant to the applicable Guidelines commentary, the court looked to “intended loss” rather than “actual loss” because the “intended loss” was the greater of the two.
Additionally, the court denied Gadson‘s requested three-level reduction for acceptance of responsibility under
The district court sided with the government, resting the denial on the fact that Gadson had not “truthfully admitted the conduct that . . . comprise[d] the offense of conviction.” Although he had pleaded guilty, Gadson contested the government‘s characterization of his role in the scheme. He disputed the application of a three-level increase for his role as a “manager or supervisor” of the scheme, as well as the inclusion of much of the conduct taken into account for the purpose of determining
Ultimately, the court calculated a total offense level of twenty-seven for bank fraud and criminal contempt, yielding a Guidelines sentencing range of 100-125 months. The court then imposed a downward-variant sentence of 80 months for those counts, to run consecutively with the mandatory minimum sentence of 24 months for identity theft and a 6-month sentence pursuant to
The court also ordered restitution in the amount of $256,537. Included in that calculation was an auto loan for $107,437 issued by TD Bank to Gadson in October 2020. Gadson obtained the loan in his own name but submitted fraudulent documents regarding his income and employment when applying for it. Gadson was current on all payments on the loan at the time of sentencing, and the court applied a credit of $13,196 for the amount already paid off.
II.
Gadson argues that his prison sentence was procedurally unreasonable based on two Guidelines calculation errors. First, he challenges the district court‘s use of “intended loss” rather than “actual loss” in determining his offense level for the bank fraud and criminal contempt counts. Second, he asserts that the court erred in denying the three-level reduction for acceptance of responsibility. We address these arguments in turn.
A.
Gadson concedes that he did not raise his “actual loss” argument to the district court, and thus we review it for plain error. See United States v. Lewis, 963 F.3d 16, 25 (1st Cir. 2020). “In order to establish plain error, a defendant must show that: ‘(1) there was error; (2) the error was plain; (3) the error affected [his] substantial rights; and (4) the error adversely impacted the fairness, integrity, or public reputation of judicial proceedings.‘” Id. (alteration in original) (quoting United States v. Clemens, 738 F.3d 1, 10 (1st Cir. 2013)).
We begin our review with the relevant Guidelines text. For certain theft crimes, including Gadson‘s,
The Guidelines themselves do not define “loss,” but the Guidelines commentary to section 2B1.1 provides that “loss is the greater of actual loss or intended loss.”
As discussed above, the district court here determined that intended loss was greater than actual loss, ultimately resulting in a twelve-level increase in Gadson‘s total offense level. Gadson asserts on appeal that the district court should have used actual loss instead of intended loss, and that, had the court done so, he would have received at most a ten-level increase under
Gadson thus asks us to reject the commentary‘s definition of “loss.” In Stinson v. United States, 508 U.S. 36 (1993), the Supreme Court held that the Guidelines commentary should be “treated as an agency‘s interpretation of its own legislative rule,” and that, accordingly, the commentary “must be given ‘controlling weight unless it is plainly erroneous or inconsistent with the regulation.‘” Id. at 44-45 (quoting Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 414 (1945)). Applying Stinson, we have held that “disregarding commentary in favor of a guideline or statute is permissible ‘only when “following one will result in violating the dictates of the other.“‘” United States v. Duong, 665 F.3d 364, 368 (1st Cir. 2012) (quoting United States v. Piper, 35 F.3d 611, 617 (1st Cir. 1994)).
Gadson makes no argument that he could prevail if Stinson applied. Instead, he asserts that the Supreme Court‘s decision in Kisor v. Wilkie, 139 S. Ct. 2400 (2019), changed the standard for deferring to the commentary. Kisor clarified that courts should not defer to an agency‘s interpretation of its own regulation “unless the regulation is genuinely ambiguous.” Id. at 2415; see Lewis, 963 F.3d at 23-24 (noting that although Kisor rejected a challenge to the Auer/Seminole Rock doctrine of agency deference, “[i]t is nevertheless fair to say that Kisor sought to clarify the nuances of judicial deference to agency interpretations of regulations“). “And before concluding that a rule is genuinely ambiguous, a court must exhaust all the ‘traditional tools’ of construction.” Kisor, 139 S. Ct. at 2415 (quoting Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 843 n.9 (1984)). “Then, ‘[i]f genuine ambiguity remains,’ a court must ensure that ‘the agency‘s reading [is] “reasonable,“’ meaning that it ‘must come within the zone of ambiguity the court has identified after employing all its interpretive tools.‘” Lewis, 963 F.3d at 24 (alterations in original) (citation omitted) (quoting Kisor, 139 S. Ct. at 2415-16).
Applying Kisor, Gadson argues that “loss” as used in
Gadson must do more than simply prove that the Guidelines mean what he says they mean. Rather, because we are reviewing Gadson‘s claim for plain error, he must prove that the district court‘s error “was plain -- which is to say, clear or obvious.” United States v. Romero, 906 F.3d 196, 209 (1st Cir. 2018). And even assuming that Kisor abrogated Stinson, and further assuming that the district court committed error by using intended loss, any such error was not “clear or obvious.”
Gadson concedes that his reading of
In reaching its conclusion, the Third Circuit explained, “The Guideline does not mention ‘actual’ versus ‘intended’ loss; that distinction appears only in the commentary. That absence alone indicates that the Guideline does not include intended loss.” Id. at 257. The court also relied in part on dictionaries, finding, “Our review of common dictionary definitions of ‘loss’ point to an ordinary meaning of ‘actual loss.’ None of these definitions suggest an ordinary understanding that ‘loss’ means ‘intended loss.‘” Id. at 258.
Because the Third Circuit was reviewing the question de novo, it expressed no opinion as to whether its interpretation was “clear or obvious.” So even if we were to agree with that court‘s ultimate conclusion that “loss” means actual loss, it would not resolve the matter here. See Lewis, 963 F.3d at 27 (concluding, with respect to a pure question of law, that “any error, if there was one, could not have been ‘clear or obvious’ as required to establish plain error“); Romero, 906 F.3d at 209 (same); United States v. Caraballo-Rodriguez, 480 F.3d 62, 76 (1st Cir. 2007) (same). The Third Circuit itself provided reason to believe that its conclusion in Banks was not necessarily “obvious,” noting that in certain contexts “‘loss’ could mean pecuniary or non-pecuniary loss and could mean actual or intended loss.” Banks, 55 F.4th at 258.
More importantly, our discussions of
As discussed above, our conclusion is not in direct tension with the Third Circuit‘s holding in Banks. Further, our opinion is consistent with a more similar case from the Fourth Circuit, United States v. Limbaugh, No. 21-4449, 2023 WL 119577
Additionally, because we reject Gadson‘s intended loss argument, we need not address his claim that the district court erred in including the TD Bank auto loan in the loss calculation. Gadson concedes that such error becomes material only if the district court plainly erred in using intended loss.
(4th Cir. Jan. 6, 2023). There, as here, the court reviewed for plain error “whether the commentary defining ‘loss’ [to include intended loss] . . . can be reconciled with the text of § 2B1.1‘s ‘loss’ provision.” Id. at *4. The court observed that it had never directly addressed the “loss” issue, but it “ha[d] routinely deferred to and relied on those commentary definitions in reviewing challenges to loss calculations.” Id. “Under those circumstances,” the court (like this court today) could not “say that the district court committed a ‘clear’ or ‘obvious’ error” by using intended loss. Id.
B.
Gadson additionally argues that the district court erred in denying the three-level reduction for acceptance of responsibility. “We review ‘a sentencing court‘s factbound determination that a defendant has not accepted responsibility’ for clear error.” United States v. D‘Angelo, 802 F.3d 205, 209 (1st Cir. 2015) (quoting United States v. Jordan, 549 F.3d 57, 60 (1st Cir. 2008)); see United States v. Coleman, 884 F.3d 67, 73 (1st Cir. 2018).
As relevant here, the commentary to
On appeal, Gadson asserts that he is entitled to the reduction based upon his guilty plea “well in advance of trial,” the district court‘s recognition of his post-offense rehabilitative efforts, and the probation officer‘s support for the reduction. But he does not contest the district court‘s factual findings that Gadson had, without merit, “disputed . . . his role in the conspiracy” and “ha[d] not accepted” “that he was the top person in this criminal activity” -- the findings that formed the basis for the district court‘s decision to deny the reduction.
Gadson fails to explain why, based on the Guidelines commentary or anything else, his guilty plea and rehabilitative efforts should outweigh his false denial of his role in the scheme. “A defendant who pleads guilty is not entitled to a downward adjustment for acceptance of responsibility as a matter of right.” United States v. Muriel, 111 F.3d 975, 982 (1st Cir. 1997). Further, “[i]t is within the discretion of the district court to deny a reduction on the basis of its determination that a defendant has resorted to half-truths or evasions from the truth in an effort to minimize his or her culpability.” Id. at 982-83. Accordingly, we cannot conclude that the district court clearly erred in determining that Gadson had not accepted responsibility.
III.
Finally, Gadson asserts that the district court should not have included the TD Bank auto loan in the restitution order. Because the government agrees with Gadson, we vacate the restitution order to that extent and remand this matter to the district court without addressing it on the merits. See United States v. Foley, 783 F.3d 7, 27-28 (1st Cir. 2015).
IV.
For the foregoing reasons, we affirm Gadson‘s prison sentence. We vacate in part (as to the TD Bank loan), and otherwise affirm the district court‘s restitution order, and remand for further proceedings consistent with this opinion.