The opinion of the court was delivered by: Arthur D. Spatt, United States District Judge
DECISION AND ORDER
In this case, a jury convicted the defendant Bruce W. Gordon ("Gordon" or the "defendant") of numerous felony charges for his role in a scheme to market membership in a purportedly prestigious "Who's Who" organization. The Second Circuit affirmed the defendant's convictions but vacated the defendant's sentence and remanded to this Court to consider the defendant's ultimate offense level.
In April 1998, a jury convicted the defendant of numerous felony counts, including conspiracy to commit mail fraud; mail fraud; tax evasion; and money laundering. In January 2000, the Court sentenced the defendant. At the sentencing hearing, the Court found that the mail fraud and tax fraud counts should be grouped pursuant to U.S.S.G. § 3D1.2(c) ("Section 3D1.2(c)"). The Court then found that the defendant had a combined offense level of 30, with a sentencing range of 97 to 121 months and sentenced him to 97 months incarceration.
In May 2002, the Second Circuit affirmed the convictions of the defendant and his co-defendants in a summary order. In a separate opinion, the Second Circuit reversed and remanded for resentencing of the defendant on the ground that this Court should have grouped the mail fraud and tax fraud counts under U.S.S.G. § 3D1.2(d) ("Section 3D1.2(d)"), instead of subsection (c). See United States v. Gordon, 291 F.3d 181, 192-93 (2d Cir. 2002). The Second Circuit also stated that "[t]he government concludes that the district court's approach improperly lowered Gordon's final sentence by two levels, although, for reasons explained in the margin, the reduction might be only one level." Id. at 189. In the margin at footnote 3, the court noted the following:
Although the government has not supplied its
calculation, it appears likely that it combined the
fraud and tax losses, identified the appropriate level
for the combined total loss from both the fraud and
tax loss tables, added adjustments, including four
levels for role in the offense, to each of the
levels, and then used level 31, resulting from the tax
guideline, because that was higher than level 29,
resulting from the fraud guideline. One more level was
then added for the money laundering offense, pursuant
to § 3D1.4, resulting in an ultimate offense level
for Gordon of 32. However, it is not clear that the
four-level enhancement for role in the offense (leader
of activity involving five or more participants,
§ 3B1.1(a)) may be applied in determining the
offense level for the tax offense. If that enhancement
is applied only to the fraud offense (as to which it
unquestionably applies), the combined dollar loss
would result in level 29 under the fraud guideline and
level 27 under the tax guideline; in that event, the
level for the group would be 29, and Gordon's ultimate
level, adjusted for the money laundering offense would
be 31 (the money laundering offense, the level of
which is 25, causes a two-level increase if the level
for the combined fraud and tax group is 29, but only a
one-level increase if the level for the combined group
is 31. See § 3D1.4(a), (b)). We leave for
consideration by the district court on remand, after
receiving submissions from the parties, how the
ultimate offense level should be calculated once the
tax and fraud offenses are grouped under subsection
Id. at 189 n. 3 (emphasis added).
There is no doubt that the four level enhancement for role in the offense (leader of activity involving five or more participants) is not to be applied in determining the offense level for the tax counts. Therefore, after properly grouping the mail and tax fraud offenses under Section 3D1.2(d), the proper level would be 31 with a term of imprisonment of 108 to 135 months. In fact, the government agrees with this determination. See Letter of Assistant United States Attorney Ronald G. White dated May 12, 2003 at 2 n. 1 ("The government agrees with Gordon (Gordon Letter at 7-8) that the grouping of the Mail Fraud and Tax Fraud Counts under subsection (d) of § 3D1.2 produces a combined final offense level of 31, which is one level higher than the offense level at his original sentencing. Level 31 carries a sentencing range of 108 to 135 months.").
At re-sentencing, the defendant raises two principal contentions. First, the defendant asserts that on this limited re-sentencing he may raise a new grouping argument, namely that the money laundering and the tax fraud counts should be grouped under Section 3D1.2(b) rather than grouping the mail fraud and tax fraud counts. Second, the defendant requests that the Court should depart downwardly on the following grounds: his prior home detention as part of his pre-trial bail conditions; that the fraud falls outside the "heartland"; that the loss overstates the seriousness of the crime; or a combination of the factors. The government contends that none of these arguments has merit.
Where, as here, the Second Circuit remands a case to correct a specific sentencing error, the defendant may not raise issues which he did not raise at his original sentencing. United States v. Quintieri, 306 F.3d 1217, 1229 (2d Cir. 2002) ("[W]e conclude that the law of the case ordinarily prohibits a party, upon resentencing or an appeal from that resentencing, from raising issues that he or she waived by not litigating them at the time of the initial sentencing."). The exception to this rule is where "a party did not, at the time of the purported waiver, have both an opportunity and an incentive to raise [the issue] before the sentencing court or on appeal." Id.
Here, the defendant asserts that he may raise a new grouping argument, namely that the money laundering and tax fraud counts should be grouped under Section 3D1.2(b). In support of his contention, the defendant argues that he had no incentive to raise this grouping argument "because it yielded — albeit through a different analysis — the same total offense level of 30" which was the offense level and corresponding sentence actually adopted by the Court at the first sentencing. In response, the government contends that the defendant did have an opportunity and an incentive to raise the grouping argument that he now urges. The Court agrees with the government.
The Court finds that the defendant had an opportunity and incentive to raise this new grouping argument prior to his re-sentencing. First, he did not raise the new grouping argument at the time he filed his written objections to the Pre-Sentence Report in January 1999. In those objections, the defendant urged two alternative grouping options: (1) the grouping of the mail fraud and money laundering counts; and (2) the grouping of all the mail fraud, tax fraud and money laundering counts under Section 3D1.2(c) and (d). Although defendant's counsel had an opportunity to raise the argument that the money laundering and the tax fraud counts should be grouped, he did not do so. He did have an incentive to raise this argument at that time, when he raised two alternative grouping recommendations. Second, he did not raise the new grouping argument at sentencing when the government objected to any grouping by the Court. As the government correctly notes, it would have been prudent to advise the Court of any other grouping methods which might lead to the same offense level. Third, he did not raise this new grouping argument on appeal which would have purportedly made any grouping error harmless.
Based on the foregoing, the Court finds that the defendant has waived his new grouping argument that the money laundering and tax fraud counts should be grouped under Section 3D1.2(b). However, to complete the record, the Court will address the merits of whether the grouping of the ...