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United States of America v. Charles White

January 2, 2013


The opinion of the court was delivered by: Surrick, J.


Presently before the Court are Defendants Charles White, Allen Smith, Michael Merin, Antoine Norman, and Akintunde Crawford's Post-Restitution Hearing and Sentencing Memoranda (ECF Nos. 490, 492-495) and the Government's Supplemental Sentencing Memorandum Regarding Number of Victims (ECF No. 491). For the following reasons, the Court finds that Defendants' offenses involved ten or more victims and the sentencing enhancement Section 2B1.1(b)(2)(A) of the United States Sentencing Guidelines ("U.S.S.G.") applies.


On July 26, 2006, the grand jury returned an indictment charging Defendants Charles White, Allen Smith, Michael Merin, Antoine Norman, Akintunde Crawford, and Kevin Norris with conspiracy to commit bank fraud and aggravated identity theft and substantive acts of bank fraud and aggravated identity theft. Defendants White, Smith, Merin, and Norman were also charged with executing or attempting to execute a scheme to defraud Commerce Bank. Defendants White, Smith, Norman, and Crawford were also charged with executing or attempting to execute a scheme to defraud M&T Bank, PNC Bank, and Wachovia Bank. Defendants White, Merin, Norman, Crawford, Smith, and Norris were also charged, in seventeen separate counts (not all Defendants were charged in each count), with knowingly and without lawful authority possessing and using a means of identification of another person. On September 7, 2007, following a jury trial, Defendants were found guilty on various counts.

At the sentencing hearing, several enhancements were applied to Defendants' offense levels. These included a fourteen-level enhancement, pursuant to U.S.S.G. § 2B1.1(b)(1), for an offense involving a loss exceeding $400,000, a four-level enhancement, pursuant to U.S.S.G. § 2B1.1(b)(2), for an offense involving at least fifty victims, and a two-level enhancement, pursuant to U.S.S.G. § 2B1.1(b)(10), for an offense involving sophisticated means.*fn1 Defendants appealed the convictions and sentences. (See ECF Nos. 267, 319, 329, 336, 356.) The Third Circuit Court of Appeals affirmed Defendants' judgments of conviction and vacated the sentences imposed. (See Judgment of Court of Appeals, ECF No. 442.)

On appeal, the Third Circuit remanded the case based upon its decision in United States v. Kennedy, 554 F.3d 415, 419 (3d Cir. 2009). Kennedy clarified the definition of the term "victims" under § 2B1.1(b)(2) of the Sentencing Guidelines. United States v. Norman, 465 F. App'x 110, 121 (3d Cir. 2012). The Third Circuit specifically left it to the discretion of the Court whether to permit the introduction of additional evidence at the sentencing hearing. Id. On November 2, 2012, a hearing was held to allow all parties to offer evidence to assist the Court in determining the number of victims pursuant to U.S.S.G. § 2B1.1(b)(2). (Min. Entry, ECF No. 485.)

At the November 2, 2012 hearing, the Government presented three witness: Marion Marcuggi; Elaine Ford; and United States Postal Inspector Thomas Ninan. (See Nov. 2, 2012 Hr'g Tr. (on file with Court).) Marcuggi, a victim of Defendants' fraud, had testified at trial. (Id. at 10.) Ford, who had been identified in discovery materials under her prior name (Elaine Kane), had not testified at trial in light of her responsibilities as a single mother of three, including a child with significant health issues. (Id. at 27, 33.) Thomas Ninan is a United States Postal Inspector. (Id. at 54.) In 2010, three years after trial, and approximately two years prior to the Third Circuit's decision in Norman, Ninan became the case agent for this matter. (Id.) Inspector Ninan testified with regard to interviews that he conducted with individual account holders prior to the hearing. (Id. at 55.) In conjunction with Inspector Ninan's testimony, the Government introduced victim-impact statements from five individuals. (See Gov't's Exs. G-1-G-5 (on file with Court).)

We directed the parties to submit supplemental briefing on the various procedural and substantive issues related to the hearing on the applicability of U.S.S.G. § 2B1.1(b)(2). On November 19, 2012, Defendants and the Government filed supplemental memoranda. (See Crawford Mem., ECF No. 490; Gov't's Mem., ECF No. 491; Norman Mem., ECF No. 492; White Mem., ECF No. 493; Smith Mem., ECF No. 494; Merin Mem., ECF No. 495.)


Defendants raise two issues for our consideration. First, Defendants contend that they were prejudiced and that the Court abused its discretion by permitting additional witness testimony at the November 2, 2012 hearing. Second, Defendants argue that the evidence uncovered during the evidentiary hearing does not support the application of the sentencing enhancement under U.S.S.G. § 2B1.1(b)(2)(A). The Government responds that the type and form of the evidence presented by the Government was proper and sufficient to establish that there were ten or more victims under § 2B1.1(b)(2)(A).

A. Prejudice to Defendants

1. Introduction of Additional Evidence

Defendants argue that the Court abused its discretion when it permitted the Government to supplement the record with regard to evidence of other potential victims. (White Mem. 3; Smith Mem. 2.) Defendants contend that the Government was always aware that it was required to present evidence establishing the number of victims if it intended to avail itself of the sentencing enhancement in U.S.S.G. § 2B1.1(b). (White Mem. 3-4.)

In its opinion remanding the case, the Third Circuit stated "we will leave it to the District Court's discretion as to whether to allow additional evidence." Norman, 465 F. App'x at 121. The court cited United States v. Coward, 296 F.3d 176, 180 (3d Cir. 2002). In Coward, the Third Circuit found that the Government neglected to introduce readily available evidence "out of a faulty interpretation of the law." Id. at 182. In remanding the case to the district court, the court explained: "[c]onsideration should be given to whether the law on point at the time was unclear or ambiguous, as well as to whether new evidence came to light after the proceedings closed." Id. The court further acknowledged that "'[w]hen faced with a motion to reopen, the district court's primary focus should be on whether the party opposing reopening would be prejudiced if reopening is permitted.'" Id. at 181 (quoting United States v. Kithcart, 218 F.3d 213, 220 (3d Cir. 2000)).

Defendants contend that the Government has failed to satisfy the requirement in Coward that the party seeking to reopen a hearing provide good cause as to why the evidence was not introduced at an earlier proceeding. (Smith Mem. 3; Nov. 2 Hr'g Tr. 5-8.) In addition, Defendants argue that because "the law in various [c]circuits was clear . . . there was absolutely no reason for the ...

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