United States v. Davis

Full title: UNITED STATES OF AMERICA, Plaintiff, v. KELLI DAVIS, Defendant

Court: United States District Court, C.D. California

Date published: Aug 13, 2004

330 F. Supp. 2d 1098 (C.D. Cal. 2004)

Opinion

No. CR 03-41 WJR.

August 13, 2004

Debra W. Yang, United States Attorney, Steven D. Clymer, Special Assistant United States Attorney, Christine M. Adams, Assistant United States Attorney, Stephanie Yonekura McCaffrey, Assistant United States Attorney, Los Angeles, CA, Counsel for Plaintiff: United States.

Mark J. Geragos, George W. Buehler, Mark K. Kassabian, Geragos Geragos, A Professional Corporation of Lawyers, Los Angeles, CA, Counsel for Defendant: Kelli Davis.

OPINION AND ORDER

WILLIAM REA, Senior District Judge

Having considered the motion, the papers filed in support thereof and in opposition thereto, the oral argument of counsel, and the file in the case, the Court now makes the following decision. The Court finds that Blakely v. Washington, 124 S. Ct. 2351 (2004), applies to Defendant's sentencing as explained in United States of America v. Ameline, No. 02-30326, ___ F.3d ___, 2004 U.S. App. LEXIS 15031 (9th Cir. July 21, 2004). The Court will sentence Defendant as scheduled on September 13, 2004, based on an eight point offense level without the aid of a sentencing jury.

BACKGROUND

Defendant, Kelli Davis ("Defendant") was charged on January 6, 2003, with six counts of wire fraud resulting from six real estate loan transactions in which Defendant acted as a loan broker. Defendant was charged with submitting false information about borrowers' residence, employment, and income in applications for loans insured by the Federal Housing Administration ("FHA").

The indictment also charged Defendant with causing "fraudulent FHA-insured loan applications seeking not less than $9 million to be submitted in the names of . . . non-qualifying and straw buyers." However, the six charged transactions resulted in only $644,515.00 in loss to the FHA. Because the Government did not pursue any counts against Defendant other than the six originally charged, the Court granted Defendant's motion to strike the reference to the $9 million.¹ See Judge Baird's Minute Order of February 22, 2003.

1 On March 4, 2003, Judge Baird transferred this case to the calendar of Judge Rea for all further proceedings.

On April 4, 2003, the jury returned guilty verdicts on the six charged wire fraud counts. The jury made no findings, however, regarding any uncharged transactions.

Defendant moved for an order establishing that the rule announced in Blakely applies to sentencing in this case. Since the time Defendant filed its motion, the Ninth Circuit inAmeline addressed the issues raised by Blakely and held that the Blakely Court's reasoning applies fully to the United States Sentencing Guidelines. This Court is bound by theAmeline decision.

DISCUSSION

Defendant argues that the rule announced in Blakely applies to sentencing in this case. Blakely v. Washington, 124 S. Ct. 2531 (2004). Since the time Defendant filed its motion, the Ninth Circuit in Ameline held that the Blakely Court's reasoning applies fully to the United States Sentencing Guidelines. United States of America v. Ameline, No. 02-30326, ___ F.3d ___, 2004 U.S. App. LEXIS 15031 (9th Cir. July 21, 2004). This Court is bound by the Ameline decision and, thus, holds that Blakely's reasoning applies to this case.

The Ameline court described the Blakely opinion as working "a sea change in the body of sentencing law." 2004 U.S. App. LEXIS 15031 at *12. Blakely's premise is simple: a district court judge may only impose a sentence based on "facts reflected in the jury verdict or admitted by the defendant." Id. at *12-13. While the court must apply Blakely to determine the proper method of sentencing, this is challenging because theBlakely analysis is extremely complex.

Ameline held the following: (1) Blakely does apply to the United States Sentencing Guidelines; 2004 U.S. App. LEXIS 15031 at *15-27, and, (2) the unconstitutional portions of the Guidelines are severable from the remainder of the Guidelines,Id. at *32-39. Ameline then directed the district court on remand to "convene a sentencing jury to try the drug quantity and firearm issues, which, if proven beyond a reasonable doubt, may be used to increase Ameline's sentence." Id. at *42.

In this case, the government seeks the Court to apply a 13 point enhancement for the amount of loss to the victim, the FHA. Under the Guidelines, the Court must apply this 13 point enhancement if it finds that Defendant's fraudulent acts in making 82 loans that were not charged in the indictment caused the loss to FHA. Clearly, the Court may not make such a finding under Blakely and Ameline.

Simply transferring this inquiry to a sentencing jury, however, will not resolve the constitutional infirmity under Blakely. Defense counsel's reply briefly informs the Court that the government could not have charged Defendant with the 82 additional counts of wire fraud because the statute of limitations on those counts had already run. Thus, even if the trial occurred after Blakely, the government could not have presented the additional 82 counts to the jury. The Court will not allow the government to circumvent the statute of limitations through sentencing. Because these facts were barred by the statute of limitations and, thus, could not have been decided by the jury during trial, the Court will not allow them to get in through the back door as sentencing factors.² See Apprendi v. New Jersey, 530 U.S. 466, 120 S. Ct. 2348, 147 L.Ed. 435 (2000) (rejecting government's attempt to disguise element of a crime as a sentencing factor). A sentencing jury is not appropriate for this type of enhancement, which is based on the Defendant's alleged commission of 82 crimes in addition to those charged in the indictment. Cf. Ameline 2004 U.S. App. LEXIS 15031 at *42 (sentencing jury may appropriately determine the amount of drugs involved in the crime to which the defendant pled guilty).³

2 The government additionally seeks a two point enhancement based on the amount of planning involved in the crime. The Court believes that this enhancement is warranted based on the jury's original findings. However, the sentence allowable with this enhancement is no different from the sentence without the two point enhancement. Thus, the question of the constitutionality of the two point enhancement is moot.

3 U.S. v. Williams, 217 F.3d 751, 754 (9th. Cir. 2000).See U.S. Supplemental Opposition Brief to Defendant's Blakely Motion at 2. Williams involved merely "relevant conduct" as opposed to 82 distinct criminal acts, as evidenced here. Further, to the extent that Williams could apply to the instant case, the Court finds that the reasoning in Blakely forbids it.

CONCLUSION

For the forgoing reasons, the Court will sentence Defendant as scheduled on September 13, 2004 based on an eight point offense level without the aid of a sentencing jury. Additionally, the Court recognizes that the Supreme Court granted certiorari onUnited States v. Booker, 2004 WL 1535858 (7th Cir. July 9, 2004) and United States v. Fanfan, No. 03-47-P-H (D. Me. June 28, 2004), which raise the same issues as Ameline, and thus the Court will exercise its inherent authority to pronounce an alternative, indeterminate sentence. The Court requests that the probation officer prepare a revised pre-sentence report that reflects this ruling.

IT IS SO ORDERED.