United States of America v. RUSSELL DANE REEVES

New Orleans, LA - Criminal defense lawyer represented defendant with arguing that the government breached the plea agreement and that the district court improperly enhanced the sentence claim.

Reeves and his codefendants defrauded elderly persons by persuading them to turn over

money to be invested in what were really

sham companies. Reeves pleaded guilty of

mail fraud targeting the elderly, a violation of

18 U.S.C. §§ 2, 1341, and 2326, and securities

fraud in violation of 15 U.S.C. §§ 77q(a)

and 77x.

Reeves and the government signed a

Factual Resume and a "Stipulation of

Applicable Guidelines,” which included, inter

alia, a two level enhancement under § 3B1.3

2

because the offense involved the abuse of a

position of trust, an enhancement that Reeves

reserved the right to challenge. The agreement

stated that "the government recommends that

the defendant be sentenced to a term of

imprisonment of 72 months.”

The presentence report ("PSR”) recommended all of the offense level enhancements

and reductions included in the stipulation and

further recommended that Reeves's offense

level be increased by two levels pursuant to

U.S.S.G. § 2F1.1(b)(3) because the offense

was committed through mass marketing. Including the mass marketing enhancement, the

PSR calculated a sentencing guidelines range

of 87-108 months' imprisonment.

At sentencing, the government objected to

the PSR's application of an enhancement for

mass marketing.1

Reeves objected to the enhancements for mass marketing and abuse of

trust. The court overruled the objections and

sentenced Reeves to 108 months'

imprisonment and three years' supervised

release for the securities fraud conviction and

60 months' imprisonment and three years'

supervised release for the mail fraud

conviction, to run concurrently.

II.

Reeves contends the government failed to

abide byits promise to recommend a 72-month

sentence. Whether the government has

breached a plea agreement is a question of law

we review de novo. United States v. Saling,

205 F.3d 764, 766 (5th Cir. 2000). Because

Reevesfailed to object atsentencing, however,

we review only for plain error.2

United States

v. Branam, 231 F.3d 931, 933 (5thCir. 2000).

Although "[t]he Government's breach of a

plea agreement can constitute plain error,” id.

(quoting United States v. Wilder, 15 F.3d

1292, 1301 (5th Cir. 1994)), "we will not exercise our discretion to correct a forfeited

error unless it seriously affects the fairness,

integrity, or public reputation of judicial

proceedings,” id. (citing United States v.

Olano, 507 U.S. 725, 735-36 (1993)). In

determining whether a plea agreement has

been breached, we inquire whether the

government's conduct "is consistent with the

defendant's reasonable understanding of the

agreement.” Saling, 205 F.3d at 766 (quoting

United States v. Valencia, 985 F.2d 758, 761

(5th Cir. 1993)).

A.

Reeves aversthat the government breached

the agreement by failing orally to recommend

a 72-month sentence at the hearing. That contention has no merit.

The only statement that could be construed

even remotely as a promise on the part of the

government isthe plea agreement'sstipulation

1 Without themass marketing enhancement, the

sentencing range would have included the

recommended 72-month term.

2 Reeves argues that he did in fact object at

sentencing. That argument has no merit, however.

To avoid forfeiture, "[a] party must raise a claim

of error with the district court in such a manner so

that the district court may correct itself and thus,

obviate the need for our review.” United States v.

Krout, 66 F.3d 1420, 1434 (5th Cir. 1995) (citing

United States v. Bullard, 13 F.3d 154, 156 (5th

Cir. 1994)). Reeves's counsel did not object, but

only informed the court that the government had

recommended a sentence of 72 months. That

statement alone is insufficient to preserve the alleged error.

3

that "the government recommendsthat the defendant be sentenced to a term of

imprisonment of 72 months.” On its face,

however, the statement promises nothing. Instead, it anticipates that the plea agreement

would be incorporated into the PSR, which it

was, and thus that the recommendation would

be self-executing, which it also was.

To the extent the recommendationserves as

a promise to recommend, the promise was

satisfied by the plea agreement's inclusion in

the PSR.3

Under any standardSSand certainly

on plain error reviewSSwe cannot say that the

government breached the plea agreement in

this respect.

B.

Reeves alleges the government breached

the agreement by making the following

statement during the sentencing hearing:

Your honor, the only thing I would add

to his foundation, what he said with respect to Mr. Reeves is true with respect

to his involvement with Mr. Davenport.

The key thing in my mind and before the

Court is the fact that he went out on his

own, formed his own company as a

mirror image of Mr. Davenport's

company, victimized elderly victims

directly, not as an employee but as the

main man. And then when this Court

entered an order in the civil case, he

disobeyed that order, continued to

victimize people. And with respect to

that, I just want the Court to consider

that. I realize it's the Court's call here.

Reeves asserts that the statement functions as

a suggestion to sentence at the upper end of

the guideline range, violating an implicit promise in the plea agreement not to recommend

any sentence greater than 72 months.

The government responds, however, that its

statement must be viewed in context.

Reeves's counselhad just finished arguing that

Reeves was not the leader of the scheme and

that the leaders had been given sentences

lighter than those contemplated by the court.

Given the misleading nature of defense

counsel's argument,4

the government contends

that the statement merely fulfilled the

government's "duty to insure that the court

has complete and accurate information

concerning the defendant, therebyenabling the

court to impose an appropriate sentence.”

United States v. Block, 660 F.2d 1086, 1091

(5th Cir. Unit B Nov. 1981). Because of this

duty, "[e]fforts by the government to provide

relevant factual information or to correct misstatements are not tantamount to taking a

position on the sentence and will not violate

the plea agreement.” Id.; accord United States

v. Goldfaden, 959 F.2d 1324, 1328 (5th Cir.

1992).

Reeves's argument has some merit. Block

does not allow the government carte blanche

to argue for a higher sentence under the guise

of correcting factual inaccuracies. See Saling,

205 F.3d at 766-67; Valencia, 985 F.2d at

759. Moreover, the government, when

correcting the factual misstatements, could

have been more explicit in disclaiming any

3 Cf. United States v. Cates, 952 F.2d 149, 153

(5th Cir. 1992) (interpreting the phrase "recommend at sentencing” to mean an oral or written recommendation and finding the provision satisfied by

inclusion of the relevant recommendation in all the

documents that were before the sentencing court).

4 Reeves indeed was the leader of at least one

scheme.

4

recommendation.5

Nonetheless, we cannot say that the

government's statement falls so far outside its

entitlement under Block as to constitute plain

error. The statement made by Reeves's

counsel created a palpable danger that the

court would misperceive the relevant facts. In

response, the government accurately restated

the relevant facts, then merely asked the court

to consider those facts, while remarking that

"it is the Court's call here.” Considering the

absence of any argument by the government

regarding the sentence or of any express

promise in the plea agreement that the

government's statement plainly violated, the

sentence is not plain error.6



III.

Reeves arguesthat the court improperlyenhanced his sentence under § 3B1.3 for "abus-

[ing] a position of private or public trust . . . in

a manner that significantly facilitated the commission . . . of the offense.” We review the

application of the guideline to the facts for

clear error, United States v. Smith, 203 F.3d

884, 893 (5thCir. 2000), and the district court

need be convinced ofthe relevant facts only by

a preponderance of the evidence, United

States v. Shugart, 117 F.3d 838, 848 (5th Cir.

1997). Application of § 3B1.3 is proper if

"the defendant's job places the defendant in a

superior position to commit a crime and the

defendant takes advantage ofthat superior position to facilitate a crime.” United States v.

Dahlstrom, 180 F.3d 677, 685 (5th Cir. 1999)

(citing United States v. Brown, 7 F.3d 1155,

1161 (5th Cir. 1993)), cert. denied, 529 U.S.

1036 (2000).

The district court adopted the PSR's

findings that

[t]he defendant held a position of trust

with the elderly clients with whom he

dealt, gaining that trust through false

and fraudulent pretenses. Numerous

victims indicated that the defendant

gained their trust after selling them a revocable living trust account. After gaining the victims' trust and learning of

their assets, the defendant defrauded the

elderly victims by convincing them to

invest large sums of money with the

defendant. This "trust” significantly facilitated the commission and

concealment of the offense.

There issufficient evidence to support the factual findings that the defendant held a position

of trust and that the position of trust significantly facilitated the offense.

Reeves and his codefendants presented

5

See Saling, 205 F.3d at 767 n.10 (noting that

even if there was a danger that the court possessed

inaccurate or incomplete information, "the

prosecutor could have so informed the court and

then expressly stated that the government would

not take a position on how [the information]should

affect [the] sentence due to the written plea

agreement.”).

6 Cf. Saling, 205 F.3d at 767 (vacating a

sentencewhere the government promised not to oppose concurrent sentencing but then expressly did

so); Valencia, 985 F.2d at 759-60 (vacating a

sentence where the government promised not to

oppose a sentence reduction for acceptance of responsibility but then expressly did so); Goldfaden,

959 F.2d at 1327 (finding plain error and vacating

a sentence where the government agreed not to

recommend any sentence but then "submitted four

memoranda to the probation department advocating

the use of different guideline sections to calculate

his sentence”).

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themselves as, inter alia, financial planners, in

which role they advised clients to invest in a

company owned by a codefendant. They also

provided "estate planning services,” including

the preparation of trust documents, an activity

for which the State Bar of Texas obtained an

injunction against Reeves's codefendant for

the unlawful practice of law. Reeves cannot

seriously argue that he did not occupy a

position of trust.7

Likewise, there is substantial evidence that

Reeves's position of trust significantly

facilitated the commission of his offenses.

Only after gaining his clients' trust by posing

as an estate planner did he advise them to

invest in his codefendant's company. Had he

not occupied the position of trust, the clients

presumably would not have followed his

investment advice. Moreover, there is

substantial evidence that Reeves's position as

estate planner gave him unique access to

clients' financial information, facilitating his

fraudulent schemes.

The judgment of sentence is AFFIRMED.