United States v. Thomas Costanzo ( 2020 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS APR 17 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 18-10291
Plaintiff-Appellee, D.C. No.
2:17-cr-00585-GMS-1
v.
THOMAS MARIO COSTANZO, MEMORANDUM*
Defendant-Appellant.
Appeal from the United States District Court
for the District of Arizona
G. Murray Snow, Chief District Judge, Presiding
Argued and Submitted March 3, 2020
Phoenix, Arizona
Before: HAWKINS, OWENS, and BENNETT, Circuit Judges.
Thomas Mario Costanzo was convicted of five counts of money laundering,
in violation of 18 U.S.C. § 1956(a)(3), and sentenced to a total of 41 months in prison
followed by three years of supervised release. On appeal, he challenges the
admission of certain evidence, the calculation of his Sentencing Guidelines range,
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
and two special conditions of his supervised release.1 We have jurisdiction under 28
U.S.C. § 1291, and we affirm in part, vacate in part, and remand to the district court.
1. Costanzo first contends that the district court erroneously admitted
three types of evidence: (1) the testimony of an individual who stated that he bought
bitcoin from and sold illicit drugs to Costanzo; (2) text messages from the spouse of
one of Costanzo’s customers, criticizing Costanzo for selling bitcoin to the customer
to facilitate a drug purchase; and (3) evidence establishing Costanzo’s anti-bank
beliefs. The district court did not abuse its discretion by admitting this evidence over
Costanzo’s objections under Federal Rules of Evidence 403 and 404(b). See United
States v. Lozano, 623 F.3d 1055, 1059–60 (9th Cir. 2010). Costanzo pursued an
entrapment defense, and the district court permissibly found that all three categories
of evidence tended to show that Costanzo had a predisposition for using bitcoin to
facilitate illicit transactions. See United States v. Mendoza-Prado, 314 F.3d 1099,
1103–04 (9th Cir. 2002).
2. Costanzo next contends that the district court erred in calculating the
applicable Sentencing Guidelines range by (1) failing to apply a downward
adjustment to his offense level for acceptance of responsibility under U.S.S.G.
1
Costanzo also challenges the sufficiency of the evidence underlying his
convictions. We address that issue and affirm his convictions in an opinion filed
simultaneously with this disposition.
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§ 3E1.1(a), and (2) applying a four-level enhancement under U.S.S.G.
§ 2S1.1(b)(2)(C)(ii).
We afford “great deference” to the district court’s determination regarding
Costanzo’s acceptance of responsibility. See United States v. Scrivener, 189 F.3d
944, 948 (9th Cir. 1999). Contrary to Costanzo’s contention, the district court did
not reject his request for an acceptance of responsibility adjustment on a categorical
basis. Instead, the district court appropriately considered the record as a whole,
including Costanzo’s sentencing letter, and explained that Costanzo had not shown
a sufficient acceptance of responsibility to warrant a downward adjustment under
§ 3E1.1. See United States v. Ramos-Medina, 706 F.3d 932, 940 (9th Cir. 2013).
We cannot say that finding was clearly erroneous. See id. at 942.
The record also supports application of the four-level enhancement under
U.S.S.G. § 2S1.1(b)(2)(C)(ii). The record contains evidence, including Costanzo’s
business advertisements, reputation in the peer-to-peer virtual currency business,
comments to undercover agents, interactions with prior customers, and the extended
nature of his dealings with the undercover agents, that could establish Costanzo was
“in the business of laundering funds” within the meaning of § 2S1.1(b)(2)(C)(ii).
See U.S.S.G. § 2S1.1 cmt. n.4
3. Finally, Costanzo contends that remand is warranted to address two
special conditions of his supervised release. The district court did not err by
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imposing Condition 5, which prohibits “major purchases” and other financial
transactions exceeding $500 without prior approval from a probation officer. A
financial reporting condition is reasonably related to the 18 U.S.C. § 3553(a)
sentencing factors under the circumstances, particularly given the nature of the crime
and Costanzo’s history. Cf. United States v. Garcia, 522 F.3d 855, 862 (9th Cir.
2008). Further, it is apparent from the language of the condition that the $500
limitation applies to “major purchases,” “financial obligations,” and “financial
contracts” alike, such that the condition is not impermissibly vague. See United
States v. Ochoa, 932 F.3d 866, 869 (9th Cir. 2019) (explaining that a condition of
supervised release is impermissibly vague “if it uses terms so vague that it fails to
give a person of ordinary intelligence fair notice that it would apply to the conduct
contemplated” (internal quotation marks, citation, and alteration omitted)).
Nor did the district court err by imposing a special condition prohibiting
Costanzo from using alcohol during his supervised release term. See United States
v. Sales, 476 F.3d 732, 735–36 (9th Cir. 2015). However, the written judgment is
broader than the oral pronouncement and precludes both the use and possession of
alcohol. Thus, as the government concedes, a limited remand is warranted to
conform the written judgment to the oral pronouncement. See United States v.
Hernandez, 795 F.3d 1159, 1169 (9th Cir. 2015).
AFFIRMED, in part, VACATED, in part, and REMANDED.
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