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October 10, 2001


The opinion of the court was delivered by: Block, District Judge.


This case was remanded for resentencing of each defendant. See United States v. Koczuk, 252 F.3d 91 (2d Cir. 2001). Defendant Wieslaw Rozbicki ("Rozbicki") was orally resentenced in open court on August 16, 2001, at which time the Court informed the parties that this memorandum would follow.*fn1 Defendant Eugeniusz Koczuk ("Koczuk") has not yet been resentenced.


The defendants were each indicted on one count of conspiring to smuggle caviar into the United States, in violation of 18 U.S.C. § 371 (Count One); one count of smuggling caviar, in violation of 18 U.S.C. § 545 (Count Two), and four counts of unlawfully importing caviar on discrete dates — September 30, 1998 (Count Three); October 12, 1998 (Count Four); October 16, 1998 (Count Five); October 20, 1998 (Count Six), in violation of the Lacey Act, 16 U.S.C. § 3372. After a jury trial, Koczuk was convicted on all counts; however, Rozbicki was only found guilty on Count Six, charging him with unlawfully importing caviar on October 20, 1998. He was acquitted on all other counts.

Koczuk was first to be sentenced. As a consequence of being convicted on all counts, he was held accountable for the retail value of all the caviar he was responsible for smuggling into the country, which the Court determined to be approximately 11 million dollars. This sum required a fifteen-level increase, calculated under the Fraud and Deceit Table in U.S. Sentencing Guidelines Manual ("Guidelines") § 2F1.1, over the base offense level of six set forth in Guidelines § 2Q2.1, applicable to all offenses involving fish, wildlife and plants.*fn2 After being given a four-level enhancement for his leadership role, see id. § 3B1.1 (a), and a two-level enhancement for obstruction of justice, see id. § 3C1.1, Koczuk's sentencing range, with a Criminal History Category of one, came to 87-108 months. The Court downwardly departed to 20 months imprisonment because, inter alia, it determined that the fifteen-level enhancement under the Fraud and Deceit Table overstated the seriousness of the offense, and that Application Note 11 to the Fraud and Deceit Guideline authorized a departure for that reason.

As for Rozbicki, the market value of the caviar attributable to his one count of conviction, as set forth in the Presentence Report, was less than $100,000, based upon the quantity of caviar that he was found to have brought into the United States on October 20th on a plane from Poland. Nonetheless, the Court found, as relevant conduct under Guidelines § 1B1.3, that Rozbicki was also responsible for caviar carried by two other passengers on that plane, for a collective value of $246,000. Of far greater impact on Rozbicki's sentence, the Court further determined, under the constraints of relevant conduct, that Rozbicki also had to be held accountable for the full value of the multi-millions of dollars of caviar attributable to Koczuk, even though Rozbicki, unlike Koczuk, had been acquitted of all criminal charges (including the conspiracy count), other than the October 20th importation. Thus, both Rozbicki and Koczuk were subject to the same fifteen-level increase under the Fraud and Deceit Table. Put another way, the acquittals made no difference in the calculation of Rozbicki's sentencing range. All relevant conduct findings were made by the preponderance of the evidence standard.

Rozbicki's sentence was assuaged to the extent that the Court found that his role in the smuggling scheme was qualitatively different from Koczuk's because Rozbicki was merely Koczuk's employee, essentially functioning as his driver and interpreter; accordingly, he was afforded a four-level reduction for minimal participation. See id. § 3B1.2(a). With enhancements for pecuniary gain and obstruction of justice, and a Criminal History Category of one, Rozbicki's guideline range came to 37-46 months. The Court downwardly departed to five months incarceration. Consistent with its departure ruling regarding Koczuk, the Court once again determined that it had the power to depart under Application Note 11 of § 2F1.1 if it found, as it did, that the fifteen-level enhancement under the Fraud and Deceit Table overstated the seriousness of Rozbicki's criminal conduct. It further determined, in support of the departure, that Rozbicki's participation in the crimes was minimal to a degree not contemplated by the Guidelines.

Both defendants, as well as the government, appealed. In a summary order, the Circuit Court affirmed the convictions and rejected that part of the government's appeal challenging Rozbicki's four-level minimal role reduction. See United States v. Koczuk, 252 F.3d 91 (2d Cir. 2001). In that regard, the Circuit Court noted: "The record supports a finding that Rozbicki was a low-level employee who primarily took orders from Koczuk. It also provides a basis to conclude that Rozbicki was making a small sum of money each week for his services and was not actively involved in Koczuk's caviar business." Id. at 7. The Circuit Court addressed the sentence remand in a written opinion, concluding, inter alia, that it was improper for the District Court to consider as one of its reasons for departing that the Fraud and Deceit Table overstated the seriousness of the defendants' respective conduct. It understood the District Court's reason in that regard as impermissibly being predicated on the absence of economic loss, and further held that only the Fraud and Deceit Table, and not the Fraud and Deceit Application Note, was applicable under Guidelines § 2Q2.1. See Koczuk, 252 F.3d at 97-98. The Circuit Court noted that "[o]n remand, the District Court is free to consider whether a downward departure may be appropriate for other reasons." Id. at 99.

At Rozbicki's resentence, the Court again downwardly departed, sentencing Rozbicki principally to a year and a day, followed by two years of supervised release. In doing so, it relied, inter alia, on two discrete bases for downward departure when the sentencing range is driven in the main by relevant conduct. One such basis pertained exclusively to relevant conduct in respect to charges for which a defendant, as in this case, had been acquitted. Because of the absence of any recognition by the Second Circuit distinguishing between acquitted conduct and uncharged conduct in assessing relevant conduct downward departures, the Court has decided to pen this memorandum.*fn3


The sentencing of a defendant under the Guidelines to the same term of imprisonment regardless of whether the defendant stands convicted or acquitted has triggered a spate of criticism by the courts and academic commentators. See United States v. Watts, 519 U.S. 148, 164 n. 3, 117 S.Ct. 633, 136 L.Ed.2d 554 (1997) (dissenting opinion) (collecting authorities); United States v. Baylor, 97 F.3d 542, 549 n. 1 (D.C.Cir. 1996) (concurring opinion) (collecting authorities). Perhaps the most damning judicial condemnation has been articulated by Judge Wald in his concurring opinion in Baylor, referring to "the use of acquitted conduct in an identical fashion with convicted conduct" as leaving "a jagged scar on our constitutional complexion," 97 F.3d at 550, and echoing Judge Newman's entreaty that "the law must be modified." Id. (quoting United States v. Concepcion, 983 F.2d 369, 396 (2d Cir. 1992) (Newman, J., dissenting from denial of request for rehearing en banc)). Nonetheless, Judge Wald was constrained to acknowledge that all but the Ninth Circuit had as of that date ruled that "the guidelines and the law authorizing their creation permit such use [of acquitted conduct], and that this practice is constitutional." Id. at 549.

Soon after Baylor, the Supreme Court in Watts resolved the circuit split created by the Ninth Circuit to the extent of holding that "a jury's verdict of acquittal does not prevent the sentencing court from considering conduct underlying the acquitted charge, so long as that conduct has been proved by a preponderance of the evidence." Watts, 519 U.S. at 157, 117 S.Ct. 633 (per curiam). Nonetheless, Watts hardly put the debate to rest. As Justice Kennedy noted in dissent: "At the least it ought to be said that to increase a sentence based on conduct underlying a charge for which the defendant was acquitted does raise concerns about undercutting the verdict of acquittal, concerns noted by Justice STEVENS and the other federal judges to whom he refers in his dissent." Id. at 170, 117 S.Ct. 633 (Kennedy, J., dissenting). He further observed that "the effect of the Sentencing Reform Act of 1984 on this question deserves careful exploration," as illustrated by the fact that Justices Scalia and Breyer "each [found] it necessary to issue separate opinions setting forth differing views on the role of the Sentencing Commission." Id.

As part of the unsettling landscape, the per curiam majority opinion in Watts did acknowledge that although "application of the preponderance standard at sentencing generally satisfies due process," there was "a divergence of opinion among the Circuits as to whether, in extreme circumstances, relevant conduct that would dramatically increase the sentence must be based on clear and convincing evidence." Id. at 156, 117 S.Ct. 633. The Court chose not to address that issue since it did not believe that the facts in that case presented "such exceptional circumstances." Id. at 157, 117 S.Ct. 633. Curiously, in so identifying this unresolved issue, the Court did not prescind between uncharged and acquitted relevant conduct, which undoubtedly contributed to Justice Kennedy's observation that "[a]t several points the per curiam opinion shows hesitation in confronting the distinction between uncharged conduct and conduct related to a charge for which the defendant was acquitted. The distinction ought to be confronted by a reasoned course of argument, not by shrugging it off." Id. at 170, 117 S.Ct. 633 (Kennedy, J., dissenting).

The Supreme Court in Watts collated the holdings of those circuit courts which had weighed in on the issue of the evidentiary standard to be employed in assessing relevant conduct. See id. at 157 n. 2, 117 S.Ct. 633. In that regard, it recognized that the Second Circuit in United States v. Gigante, 94 F.3d 53 (2d Cir. 1996), although "not reaching the due process issue," formulated the following test for upward adjustments and upward departures: "[T]he preponderance standard is no more than a threshold basis for adjustments and departures, and the weight of the evidence, at some point along a continuum of sentence severity, should be considered with regard to both upward adjustments and upward departures." Watts, 519 U.S. at 157 n. 1, 117 S.Ct. 633 (quoting Gigante, 94 F.3d at 56). The Second Circuit in Gigante also addressed the concept of downward departures, commenting: "Where a higher standard appropriate to a substantially enhanced sentence range is not met, the court should depart downwardly. Because the risk of factual error in a series of adjustments, each of which involves conduct proven by a bare preponderance, is a circumstance present at least `to a degree' not adequately considered by the ...

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