United States v. Longwell , 410 F. App'x 684 ( 2011 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-4821
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
JENNIFER MICHELLE LONGWELL, a/k/a Jennifer Michelle Hughart,
Defendant - Appellant.
Appeal from the United States District Court for the Southern
District of West Virginia, at Parkersburg. Robert C. Chambers,
District Judge. (6:08-cr-00243-1)
Argued: September 23, 2010 Decided: February 3, 2011
Before NIEMEYER and KEENAN, Circuit Judges, and Jerome B.
FRIEDMAN, Senior United States District Judge for the Eastern
District of Virginia, sitting by designation.
Affirmed by unpublished per curiam opinion.
ARGUED: Nicole Nicolette Mace, THE MACE FIRM, Myrtle Beach,
South Carolina, for Appellant. Thomas Charles Ryan, OFFICE OF
THE UNITED STATES ATTORNEY, Charleston, West Virginia, for
Appellee. ON BRIEF: Charles T. Miller, United States Attorney,
Charleston, West Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
This criminal appeal presents two issues for our
consideration: 1) whether the district court erred in denying
the defendant’s motion for a mistrial, and 2) whether the
district court erred in calculating the defendant’s advisory
Sentencing Guidelines range.
A jury convicted the defendant, Jennifer M. Longwell, on
one count of concealment of assets in connection with a pending
bankruptcy case, in violation of 18 U.S.C. § 152(1), and two
counts of making false statements in connection with a
bankruptcy case, in violation of 18 U.S.C. § 152(2). The
district court sentenced Longwell to forty-one months
imprisonment.
For the reasons set forth below, we hold that the district
court did not err in denying Longwell’s motion for a mistrial or
in applying the Sentencing Guidelines. Accordingly, we affirm
Longwell’s convictions, as well as the sentence imposed by the
district court.
I.
Longwell, a licensed real estate broker, opened her own
mortgage brokerage business, Global Home Loans and Finance
Company (“Global Home Loans”), in 2002. Longwell filed a
Chapter 7 bankruptcy petition in the United States Bankruptcy
2
Court for the Southern District of West Virginia on February 25,
2005. In the petition, Longwell stated that she owned three
properties. The first, located on Highland Avenue in
Williamstown, West Virginia, was Longwell’s personal residence.
The remaining two, located on West 4th Street in Williamstown,
West Virginia, and on Mary Street in Parkersburg, West Virginia,
were designated as rental properties. At trial, Timothy King
testified that Longwell agreed to sell him both rental
properties in late 2004.
On March 2, 2005, Longwell sold the West 4th Street
property to King for its appraised value of $101,500. 1 King
obtained the mortgage to purchase the property from Longwell’s
company, Global Home Loans. At closing, Longwell produced the
payoff statement for the Mary Street property. As a result, the
closing attorney, Ralph Wilson, mistakenly used the proceeds
from the West 4th Street sale to pay off Longwell’s Mary Street
mortgage. 2 Consequently, King took possession of the West 4th
Street property subject to his own mortgage, as well as
1
King testified at trial that Longwell obtained the
appraisal for the West 4th Street property.
2
Wilson worked with Longwell and Global Home Loans on
numerous occasions prior to the West 4th Street closing. At
trial, Mr. Wilson testified that he realized he paid off the
wrong mortgage shortly after the West 4th Street closing.
However, according to Wilson, his many attempts to contact
Longwell and remedy the situation failed.
3
Longwell’s existing $59,000 mortgage, while Longwell received a
check for $69,382.80.
On April 4, 2005, Longwell and King executed a quitclaim
deed transferring the Mary Street property to King for $40,000.
Shortly thereafter, the Mary Street property appraised for
$73,500, and King and Longwell agreed to increase the sale price
to $64,800. 3 When the sale closed on May 16, 2005, Longwell
received approximately $60,000.
Longwell’s Section 341 meeting of creditors occurred on
April 5, 2005. During the meeting, the Chapter 7 trustee
questioned Longwell about the status of the West 4th Street and
Mary Street properties. In response, Longwell stated that she
sold the West 4th Street for $87,000 and received $20,000 at
closing. Longwell also indicated that she did not intend to
sell the Mary Street property. At the close of the meeting, the
trustee instructed Longwell to provide him with a copy of the
settlement statement for the West 4th Street property, and to
inform him if she later decided to sell the Mary Street
property. 4
3
Once again, King obtained the mortgage to purchase the
property through Longwell’s company, Global Home Loans.
4
Contrary to these instructions, Longwell failed to provide
the trustee with the West 4th Street settlement statement.
Longwell also failed to notify the trustee that she sold the
Mary Street property to King.
4
Following Longwell’s Section 341 meeting, the bankruptcy
trustee filed a “Notice of No Assets,” informing Longwell’s
creditors that there were no assets to pursue. As a matter of
course, the bankruptcy court granted Longwell a discharge on
June 15, 2005.
In the fall of 2005, Wilson learned that Longwell was in
bankruptcy at the time she sold her rental properties to King.
He immediately notified the United States Trustee’s office, and
on November 17, 2005, Longwell’s bankruptcy was reopened.
Shortly thereafter, counsel for the U.S. Trustee’s office filed
a formal complaint seeking to revoke Longwell’s bankruptcy
discharge. In January of 2008, Longwell’s bankruptcy discharge
was revoked by agreed order.
Over a year later, Longwell was indicted in the United
States District Court for the Southern District of West Virginia
on one count of concealment of assets in connection with a
pending bankruptcy case, in violation of 18 U.S.C. § 152(1), and
two counts of making false statements in connection with a
bankruptcy case, in violation of 18 U.S.C. § 152(2).
Longwell’s trial began on Tuesday, April 7, 2009. The
following morning, the United States rested its case and
Longwell took the stand in her own defense. During Longwell’s
cross-examination, Longwell’s attorney, George Cosenza, received
word that his father had been hospitalized and was in critical
5
condition. After conferring with his client and family, Cosenza
notified the court of his intent to leave as quickly as possible
to be with his family. The court agreed to stop the trial, and
stated that it could either continue the trial for a short
period of time, or declare a mistrial. Noting that Longwell was
the final witness, Cosenza asked the court to continue the trial
until the following week. The government agreed, and the court
continued the matter until Tuesday, April 14, 2009. Before
adjourning, the court instructed the jury to refrain from
discussing the case with anyone during the recess.
On April 10, 2009, the court issued an order postponing the
resumption of Longwell’s trial until April 15, 2009. On April
14, 2009, the court informed the parties that it had excused two
jurors, leaving eleven available for trial. The court notified
the parties of their right to stipulate to an eleven member jury
under Federal Rule of Criminal Procedure 23(b)(2)(B), and
directed them to inform the court if they wished to so
stipulate. Later that day, the parties filed a written
stipulation agreeing to proceed with eleven jurors.
Pursuant to the parties’ stipulation, Longwell’s trial
resumed with eleven jurors on April 15, 2009. When the trial
reconvened, Cosenza informed the court that he recently learned
that the government filed an ex parte motion on April 14, 2009,
seeking to obtain Longwell’s 2002 through 2005 tax returns.
6
Cosenza further stated that he discussed the matter with
Longwell, and that she instructed him to inform the court that
she wished to withdraw her stipulation to proceed with eleven
jurors and move for a mistrial. The court denied Longwell’s
motion, her trial resumed, and the jury found Longwell guilty of
all counts.
The district court sentenced Longwell on August 24, 2009.
At sentencing, Longwell raised several objections to the
presentence investigation report. In particular, Longwell
objected to the amount of loss and number of victims used to
calculate her Sentencing Guideline range, as well as the two-
level increase recommended in the presentence report for use of
a special skill under U.S.S.G. § 3B1.3. The court denied
Longwell’s objections and sentenced her to forty-one months
imprisonment. This appeal followed.
II.
We first consider whether the district court erred in
denying Longwell’s motion for a mistrial. The decision to grant
or deny a motion for a mistrial is within the discretion of the
district court, and “will not be overturned absent a clear abuse
of that discretion.” United States v. West, 877 F.2d 281, 287
(4th Cir. 1989). On appeal, Longwell argues that the district
court abused its discretion by failing to grant her motion
7
requesting a mistrial because it (1) continued her trial without
her consent; (2) failed to adequately instruct the jury before
recessing for the continuance; (3) excused two jurors without
adequate findings of good cause; and (4) denied her request to
withdraw from a stipulation to proceed with eleven jurors under
Federal Rule of Criminal Procedure 23(b).
Longwell further contends that she suffered prejudice as a
result of the district court’s decision to deny her motion for a
mistrial because (1) two jurors were unavailable when her trial
resumed, and (2) the government was able to obtain her tax
records for the years 2002 through 2005 for use on cross-
examination. We address each of the issues raised by Longwell
below.
Longwell first contends that the district court, upon
learning of defense counsel’s family medical emergency, should
have questioned her directly about the decision to declare a
mistrial or grant a continuance. In United States v. Chapman,
593 F.3d 365, 367 (4th Cir. 2010), we observed that it is “well-
established that in a criminal trial, defense counsel has
authority to manage most aspects of the defense without first
obtaining the consent of the defendant.” Following this
observation, we concluded “that decisions regarding a mistrial
are tactical decisions entrusted to the sound judgment of
counsel, not the client.” Id. at 368. Accordingly, the
8
district court acted well within its discretion when it assented
to defense counsel’s request for a continuance without first
obtaining Longwell’s personal consent.
Longwell next argues that the district court failed to
adequately instruct the jury prior to recessing for the
continuance. Prior to the continuance, the district court
instructed the jurors in the following manner: “As I told you
before, you haven’t heard the testimony or my instructions or
the closing arguments, so please don’t discuss the case with
anyone and please don’t deliberate either together or on your
own. You need to wait until you’re together and you can
deliberate together.”
According to Longwell, the district court erred in giving
these instructions because it failed to also instruct the jury
to keep an open mind and mentally review the case during the
continuance. 5 We disagree. Longwell’s trial began on April 7,
5
In advancing this argument, Longwell relies on our
decision in United States v. Smith, 44 F.3d 1259 (4th Cir.
1995). In Smith, we found that the district court did not abuse
its discretion by denying a defendant’s request for a mistrial
after a 32 day mid-trial continuance. Smith, 44 F.3d 1267. In
reaching this conclusion, we observed that the district court
took sufficient ameliorative measures to protect against the
potential for prejudice inherent in any lengthy trial. Id.Specifically, we noted that prior to the continuance, the
district court instructed the jury to “think about the case over
the week so it remains fresh and remember that the time for you
all to make up your minds is after the last word has been said
in closing argument.” Id. (internal quotations omitted). The
(Continued)
9
2009, was continued the following the day, and resumed on April
15, 2009. In light of these facts, we conclude that the
district court adequately instructed the jury prior to recessing
for the continuance.
Third, Longwell asserts that the district court violated
Federal Rule of Criminal Procedure 23(b) by excusing two jurors
without making adequate findings of good cause. Rule 23(b)
provides that “[a]t any time before the verdict, the parties
may, with the court’s approval, stipulate in writing that . . .
a jury of fewer than 12 persons may return a verdict if the
court finds it necessary to excuse a juror for good cause after
the trial begins.” Fed. R. Crim. P. 23(b)(2)(B). On appeal,
Longwell argues that the district court failed to comply with
Rule 23(b) because it failed to sufficiently inquire into the
circumstances surrounding each excused juror’s absence and make
district court also wrote a letter to the jurors during the
continuance instructing them to “mentally review the case so
that the passage of time will not dull your memory of the
evidence, but do not reach any firm conclusions (keep an open
mind).” Id. On appeal, Longwell argues that the district court
inadequately instructed the jury because it failed to give
instructions similar to those given in Smith. However, given
the factual differences between this case and Smith, we are not
persuaded by this argument. See Smith, 44 F.3d at 1267-68(noting that Smith involved three defendants whose trial began
on January 25, 1993, was continued on March 11, 1993, and
resumed on April 12, 1993).
10
appropriate findings of good cause on the record. This
argument, however, is clearly refuted by the record.
During the continuance, the district court notified the
parties that it had already excused one juror for “good cause
shown,” and that it now was forced to excuse a second juror who
was “stricken ill.” When the trial reconvened, the court
further explained that it excused the two jurors because “one
had a trip we knew about . . . [and] the other was stricken ill
earlier in the week.” Thus, it is clear that the district judge
was fully aware of the circumstances surrounding each juror’s
absence at the time he excused them for good cause.
Furthermore, it is important to note that Longwell never
challenged the district court’s findings of good cause. Indeed,
Longwell acknowledged in her written Rule 23(b) stipulation that
the district court had excused two jurors for good cause shown.
Consequently, it is clear that the district court’s decision to
excuse two jurors and subsequently continue the trial in
accordance with the terms of the parties’ written stipulation
fully complied with Rule 23(b). 6
6
In arguing that the district court failed to comply with
Rule 23(b), Longwell relies on the following three cases: United
States v. Araujo, 62 F.3d 930 (7th Cir. 1995); United States v.
Patterson, 26 F.3d 1127 (D.C. Cir. 1994); United States v.
Essex, 734 F.2d 832 (D.C. Cir. 1984). We find each to be
unpersuasive given the facts of this case. In Araujo and
Patterson, the district court elected to proceed with eleven
(Continued)
11
Finally, Longwell maintains that the district court erred
by failing to allow her to withdraw from the written stipulation
to proceed with eleven jurors pursuant to Rule 23(b). We
enforce stipulations “absent circumstances tending to negate a
finding of informed and voluntary assent of a party to the
agreement.” United States v. Montgomery, 620 F.2d 753, 757
(10th Cir. 1980). Thus, a stipulation is not “absolute in its
effect.” Id. Rather, it is appropriate to grant a party relief
from a stipulation if it is necessary to prevent manifest
injustice. Id.; Marshall v. Emersons Ltd., 593 F.2d 565, 568
(4th Cir. 1979).
In the present case, there is no indication that Longwell
entered into the Rule 23(b) stipulation involuntarily or by
mistake. Rather, the record indicates that Longwell voluntarily
entered into the stipulation after being given time to discuss
the matter with her attorney, and only sought to withdraw from
the stipulation after she learned of the government’s intent to
utilize her 2002 through 2005 tax returns on cross-examination.
jurors under Rule 23(b)(3) despite objections by each defendant.
Araujo, 62 F.3d at 932; Patterson, 26 F.3d at 1128. In Essex,
the district court elected to continue with eleven jurors
without attempting to locate the missing juror or determine a
reason for his absence. Essex, 734 F.2d at 837. Here, as
discussed above, the district court was aware of the
circumstances surrounding each juror’s absence. Furthermore,
Longwell agreed in writing to proceed with eleven jurors.
12
Accordingly, the district court acted well within its discretion
when it denied Longwell’s request to withdraw from the Rule
23(b) stipulation. 7
We now turn to the issue of prejudice. When evaluating
prejudice, we consider “the closeness of the case, the
centrality of the issue affected by the error, and the steps
taken to mitigate the effects of the error.” United States v.
Nyman, 649 F.2d 208, 212 (4th Cir. 1980). On appeal, Longwell
argues that she suffered prejudice as a result of the denial of
her motion for a mistrial because (1) two jurors were
unavailable when her trial resumed, and (2) the government was
able to obtain her 2002 to 2005 tax records for use on cross-
examination.
As a preliminary matter, Longwell’s claim that she suffered
prejudice as a result of the absence of two jurors is without
7
In arguing that the district court erred by denying her
request to withdraw from her stipulation to proceed with eleven
jurors under Rule 23(b), Longwell relies heavily on United
States v. Curbelo, 343 F.3d 273 (4th Cir. 2003). In Curbelo,
the district court elected to proceed with eleven jurors prior
to deliberations and without the consent of the defendant in
violation of Rule 23(b). Id. at 275-76. On appeal, we
concluded that the district court’s violation of Rule 23(b)
required reversal without a finding that the defendant was
actually prejudiced by the error. Id. at 281. In contrast to
Curbelo, the district court in the present case waited to
proceed with eleven jurors until the parties entered a written
stipulation agreeing to do so as required by Rule 23(b).
Accordingly, Curbelo does not, as Longwell contends, compel us
to overturn her convictions.
13
merit. Longwell voluntarily entered into a written stipulation
to proceed with eleven jurors, and she cannot now claim to have
suffered prejudice as a result of the absence of the very jurors
she agreed to proceed without.
Longwell next argues that she suffered prejudice because
the government was able to obtain her 2002 to 2005 tax records
during the continuance, and prior to the completion of her
cross-examination. While this is indeed true, the district
court found those records to be inadmissible, and only permitted
the government to question Longwell concerning her 2005 tax
return. Accordingly, the sole issue for us to consider is
whether the use of Longwell’s 2005 tax return serves as a source
of prejudice resulting from the district court’s denial of
Longwell’s motion for a mistrial. We believe it does not and
therefore conclude that Longwell has failed to demonstrate any
actual prejudice.
Taking into account each of the issues mentioned above, we
conclude that the district court did not abuse its discretion in
declining to grant Longwell a mistrial.
III.
We next decide whether the district court erred in
determining Longwell’s Sentencing Guidelines range.
14
Longwell first asserts that the district court improperly
included interest, penalties, and late fees in its calculation
of loss. 8 We review the district court’s determination of the
amount of loss, to the extent it is a factual matter, for clear
error, and review de novo the court’s legal interpretation of
the term “loss” under U.S.S.G. § 2B1.1. United States v. West,
2 F.3d 66, 71 (4th Cir. 1993).
Here, the district court determined the amount of loss to
be $180,000. This figure includes the $129,000 in profit
Longwell realized from the sale of her two rental properties, as
well as the $51,000 in unsecured debt Longwell sought to
discharge through her amended bankruptcy petition. On appeal,
Longwell argues that the district court erred by including in
its loss calculation the full $51,000 listed in her bankruptcy
petition because that amount includes interest, penalties, and
late fees. In making this argument, Longwell relies on
application note 3(D)(i) to U.S.S.G. § 2B1.1, which provides
that “[l]oss shall not include . . . [i]nterest of any kind,
8
Longwell also argues that the district court erred by not
excluding from its loss calculation the $25,000 in real estate
equity she was entitled to exempt from the bankruptcy estate
under West Virginia law. See W. Va. Code § 38-10-4(a). We need
not address this issue in detail as it would have no impact on
the loss Longwell intended to cause.
15
finance charges, late fees, penalties, amounts based on an
agreed-upon return or rate of return, or other similar costs.”
As noted by Longwell, “the exclusion of interest from the
calculation of loss under the Guidelines serves to prevent
victims from recovering all interest they could have earned had
the fraud never occurred.” United States v. Coghill, 204 Fed.
Appx. 328, 329 (4th Cir. 2006) (citing United States v. Morgan,
376 F.3d 1002, 1014 (9th Cir. 2004)). It does not follow,
however, that the interest or penalties a defendant seeks to
discharge through bankruptcy should be excluded from a
sentencing court’s valuation of loss in a bankruptcy fraud case.
Rather, in such a case, a defendant, at the very least, intends
to deprive his creditors of the full amount listed in the
bankruptcy petition. It is therefore appropriate for the
sentencing court to include that amount in its valuation of
loss. See U.S.S.G. § 2B1.1, cmt. n.3(A) (noting that “loss is
the greater of actual loss or intended loss”); United States v.
Hughes, 401 F.3d 540, 557 (4th Cir. 2005) (noting that “in
determining the amount of loss in a bankruptcy fraud case,
courts may look to the amount of loss [the defendant] intended
to cause by concealing assets”) (internal citations omitted).
Longwell next contends that the district court erred in
determining that her offense involved ten or more victims, and
thus improperly increased her offense level by two levels under
16
U.S.S.G. § 2B1.1. We review the district court’s factual
determinations regarding the number of victims for clear error,
and review de novo its legal interpretation of the term “victim”
under U.S.S.G. § 2B1.1. United States v. Allen, 446 F.3d 522,
527 (4th Cir. 2006).
Section 2B1.1(b)(2)(A) of the Sentencing Guidelines
provides for a two-level increase in a defendant’s offense level
if the offense involved ten or more victims. For the purposes
of § 2B1.1, the term “victim” is defined as “any person who
sustained any part of the actual loss determined under
subsection (b)(1).” U.S.S.G. § 2B1.1, cmt. n.1. At sentencing,
the district court determined that Longwell caused forty-four
creditors to suffer a total loss of $51,000, which was the
amount Longwell sought to discharge through her amended
bankruptcy petition. On appeal, Longwell argues that the
government failed to introduce sufficient evidence of the loss
suffered by Longwell’s creditors. We disagree.
The record in this case provides ample support for the
district court’s determination that Longwell’s creditors
suffered an actual loss as required under § 2B1.1(b)(2)(A). As
a result of Longwell’s misconduct, the bankruptcy trustee
notified her creditors that there were no assets to pursue in
bankruptcy. Longwell’s creditors responded by “writing off”
their claims against her. As of the date of sentencing,
17
Longwell’s creditors remained unpaid. In light of these facts,
it is clear that the district court did not err by increasing
Longwell’s offense level under U.S.S.G. § 2B1.1(b)(2)(A).
Finally, Longwell maintains that the district court erred
by increasing her offense level for use of a special skill under
U.S.S.G. § 3B1.3. Longwell challenges the district court’s
application of § 3B1.3 in two respects. First, Longwell
contends that a mortgage broker does not qualify as someone
possessing a special skill for the purposes of § 3B1.3. Second,
Longwell argues that her status as a mortgage broker did not
facilitate the commission of her offense. Whether a mortgage
broker possesses a special skill for the purposes of § 3B1.3 is
a question of law, and is thus reviewed de novo. United States
v. Gormley, 201 F.3d 290, 295 (4th Cir. 2000). The district
court’s findings at sentencing as to Longwell’s use of her
skills as a mortgage broker are findings of fact reviewed for
clear error. Id.Section 3B1.3 of the Sentencing Guidelines provides for a
two level increase in a defendant’s offense level if the
defendant used a special skill “in a manner that significantly
facilitated the commission or concealment of the offense.” The
commentary to § 3B1.3 states that “‘special skill’ refers to a
skill not possessed by members of the general public and usually
requiring substantial education, training or licensing.
18
Examples would include pilots, lawyers, doctors, accountants,
chemists, and demolition experts.” U.S.S.G. § 3B1.3, cmt. n.4.
While mortgage brokers may not endure the same level of training
as a doctor, pilot, or lawyer, they certainly possess a skill
not possessed by members of the general public which is obtained
through training and licensing. Thus, the skill possessed by a
mortgage broker qualifies as a special skill for the purposes of
U.S.S.G. § 3B1.3.
Turning to Longwell’s second argument regarding § 3B1.3,
the record reveals that Longwell utilized her skill as a
mortgage broker to facilitate the transactions that resulted in
her convictions for bankruptcy fraud. Accordingly, Longwell’s
argument that the district court clearly erred in determining
that she used a special skill as required by U.S.S.G. § 3B1.3 is
without merit.
IV
For the aforementioned reasons, we affirm Longwell’s
convictions and sentence.
AFFIRMED
19