United States v. Frederick Jenkins , 701 F. App'x 897 ( 2017 )

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-11428
Non-Argument Calendar
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D.C. Docket No. 1:14-cr-00192-ODE-AJB-1
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
FREDERICK JENKINS,
WILLIE JENKINS,
Defendants-Appellants.
________________________
Appeals from the United States District Court
for the Northern District of Georgia
________________________
(July 21, 2017)
Before TJOFLAT, MARCUS, and WILSON, Circuit Judges.
PER CURIAM:
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Frederick Jenkins and Willie Jenkins, brothers who ran a tax-preparation
company, were convicted of conspiring to prepare fraudulent tax returns on behalf
of certain clients and of willfully preparing fraudulent returns on behalf of the
clients. The district court sentenced Frederick to 78 months’ imprisonment and
Willie to 75 months’ imprisonment, and it ordered them to pay $3.5 million in
restitution.
Frederick and Willie now appeal their convictions and sentences. They
argue that the district court erred by (1) constructively amending their indictment,
(2) limiting Frederick’s cross-examination of a government witness, (3) allowing
them to proceed pro se at sentencing, (4) determining that they are responsible for
more than $3.5 million in tax loss, and (5) requiring them to pay $3.5 million in
restitution. After careful consideration of the record and the parties’ briefs, we
affirm in part, vacate in part, and remand for resentencing. We affirm Frederick’s
and Willie’s convictions. But we vacate their sentences because the district court
erred in finding that they are responsible for more than $3.5 million in tax loss and
in ordering $3.5 million in restitution.
I. CONSTRUCTIVE AMENDMENT
The Fifth Amendment prohibits the district court from constructively
amending an indictment. See United States v. Keller, 916 F.2d 628, 632–33 (11th
Cir. 1990). The district court constructively amends an indictment if it alters “the
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essential elements of the offense contained in the indictment . . . to broaden the
possible bases for conviction beyond what is contained in the indictment.” United
States v. Narog, 372 F.3d 1243, 1247 (11th Cir. 2004) (citing Keller, 916 F.2d at
634). But it does not constructively amend an indictment when it ignores “[a] part
of the indictment unnecessary to and independent of the allegations of the offense.”
See United States v. Miller, 471 U.S. 130, 136, 105 S. Ct. 1811, 1815 (1985). In
other words, the district court may ignore parts of an indictment that are “merely
surplusage.” See id. at 137, 105 S. Ct. at 1815 (internal quotation marks omitted).
The district court did not constructively amend Frederick and Willie’s
indictment—it ignored a part of the indictment that was mere surplusage.
Frederick and Willie argue that the district court constructively amended their
indictment because, although the indictment alleged that they prepared fraudulent
tax returns on behalf of several clients “without the [clients]’ knowledge and
consent,” the court instructed the jury that the government did not have to prove
the clients lacked knowledge and consent. However, the indictment’s allegations
about the clients’ knowledge and consent were “unnecessary to the offense[s]”
contained in the indictment. See id., 105 S. Ct. at 1815. The indictment alleged
that Frederick and Willie conspired to prepare fraudulent tax returns and that they
willfully prepared fraudulent tax returns. As Frederick’s attorney conceded at trial,
whether the clients knew that the tax returns contained fraudulent information was
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irrelevant to these offenses; only Frederick’s and Willie’s mens rea was relevant.
The allegations about the clients’ knowledge and consent, then, “would have had
no legal relevance if proved.”1 See id., 105 S. Ct. at 1815.
II. LIMITING CROSS-EXAMINATION OF A GOVERNMENT WITNESS
Although the district court has “the power to limit” a defendant’s cross-
examination of a government witness, the court’s “discretion is limited by the
guarantee of the Sixth Amendment’s Confrontation Clause that a criminal
defendant has the right to cross-examine prosecutorial witnesses.” United States v.
Maxwell, 579 F.3d 1282, 1295 (11th Cir. 2009) (internal quotation marks omitted).
Under the Confrontation Clause, a defendant is entitled to “an opportunity for
effective cross-examination.” Id. at 1296 (internal quotation marks omitted). And
the district court may not limit a defendant’s cross-examination if “a reasonable
jury would have received a significantly different impression of the witness’[s
testimony] had [the defendant] pursued the proposed line of cross-examination.”
United States v. Garcia, 13 F.3d 1464, 1469 (11th Cir. 1994).
The district court did not err in limiting Frederick’s cross-examination of a
government witness. Frederick and Willie had an opportunity for effective cross-
examination of the witness. Frederick and Willie argue that the district court
1
As an alternative to their constructive-amendment argument, Frederick and Willie argue
that the government’s evidence at trial materially varied from the indictment. That argument,
however, is unavailing.
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violated their Sixth Amendment rights because the court, after questioning the
relevance of Frederick’s cross-examination of the witness, limited the examination
to ten additional minutes. The district court’s decision to limit the cross-
examination, Frederick and Willie contend, prevented them from eliciting
testimony suggesting that they did not file certain tax returns. But based on our
review of the record, Frederick questioned the government witness about the tax
returns at length and elicited helpful testimony. We cannot conclude that “a
reasonable jury would have received a significantly different impression” of the
witness’s testimony had the district court not limited Frederick’s cross-
examination. See id.
III. WAIVER OF RIGHT TO COUNSEL
When a defendant seeks to waive his right to counsel, the district court must
satisfy itself that the defendant is competent to do so, and it must satisfy itself that
the defendant’s waiver is knowing and voluntary. See Godinez v. Moran, 509 U.S.
389, 400, 113 S. Ct. 2680, 2687 (1993). A defendant is competent to waive his
right to counsel if he meets the standard for competency to stand trial—that is, if
he “has sufficient present ability to consult with his lawyer with a reasonable
degree of rational understanding and has a rational as well as factual understanding
of the proceedings against him.” Id. at 396, 113 S. Ct. at 2685 (internal quotation
marks omitted). A defendant’s waiver is knowing and voluntary if he is “made
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aware of the dangers and disadvantages of self-representation” such “that he knows
what he is doing and his choice is made with eyes open.” United States v. Kimball,
291 F.3d 726, 730 (11th Cir. 2002) (per curiam) (internal quotation marks
omitted).
The district court did not err in allowing Frederick and Willie to proceed pro
se at sentencing. The court did not have cause to believe that Frederick and Willie
were not competent to waive their counsel, and prior to their waiver, the court
“made [them] aware of the dangers and disadvantages of self-representation.” See
id. (internal quotation marks omitted).
First, no information arose during Frederick and Willie’s proceedings that
established a “bona fide doubt regarding the[ir] competence.” See United States v.
Wingo, 789 F.3d 1226, 1235–36 (11th Cir. 2015) (internal quotation marks
omitted). We look to three factors in determining whether information arose at
trial that established a bona fide doubt about competence: “(1) evidence of the
defendant’s irrational behavior; (2) the defendant’s demeanor at trial; and (3) prior
medical opinion regarding the defendant’s competence . . . .” Id. at 1236 (internal
quotation marks omitted). Considering these factors, we cannot conclude that a
bona fide doubt about competency existed here. Frederick and Willie made a few
irrational statements when they requested to waive counsel, but at that time they
also engaged in colloquy with the court that reflected a rational understanding of
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the proceedings. Further, neither Frederick’s nor Willie’s demeanor during their
weeklong trial signaled incompetence, and their counsel never raised any concerns
about competency. Finally, no prior medical opinions suggested competency
issues.
Second, Frederick and Willie knowingly and voluntarily waived counsel at
sentencing. The district court informed them that the sentencing process is
complex and requires technical analysis, including examining the Sentencing
Guidelines; that navigating the sentencing process without counsel would be
difficult; that, in the opinion of the court, waiving counsel was a mistake; and that
they faced prison sentences. With the benefit of this information, Frederick and
Willie, without equivocating, decided to waive counsel. Indeed, they even rejected
the district court’s offer to appoint them new counsel. Frederick and Willie
decided to waive counsel voluntarily and “with eyes open.” See Kimball, 291 F.3d
at 730 (internal quotation marks omitted).
IV. AMOUNT OF TAX LOSS
The government, in asking the district court to adopt a certain tax-loss
calculation at sentencing, “must establish the facts by a preponderance of the
evidence and support the loss calculation with reliable and specific evidence.”
United States v. Cobb, 842 F.3d 1213, 1219 (11th Cir. 2016). If the defendant’s
“offense involved the filing of . . . fraudulent or false tax return[s], the tax loss is
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the total amount of loss that was the object of the offense . . . .” United States v.
Clarke, 562 F.3d 1158, 1164 (11th Cir. 2009) (citing U.S.S.G. § 2T1.1(c)(1)).
When determining the scope of the offense, the district court should consider “all
conduct violating the tax laws . . . as part of the same course of conduct or
common scheme or plan.” U.S.S.G. § 2T1.1 cmt. n.2.
The district court erred in finding that Frederick and Willie are responsible
for more than $3.5 million in tax loss. The court’s finding was based on its
conclusion that Frederick and Willie willfully prepared hundreds of fraudulent tax
returns, but the government failed to prove that by a preponderance of the
evidence. See Cobb, 842 F.3d at 1219.
A. RELEVANT BACKGROUND
At trial the government offered evidence that Frederick and Willie prepared
16 fraudulent tax returns. The evidence showed that each of the 16 returns
reported fraudulent business expenses on a Schedule C, namely non-existent
advertising and office expenses; claimed business losses; and sought a tax refund.
Based on that evidence, Frederick and Willie were convicted on one count of
conspiring to prepare fraudulent tax returns and on several counts of willfully
preparing fraudulent returns.
At sentencing the government, seeking to establish that Frederick and Willie
are responsible for hundreds of additional fraudulent tax returns, offered the
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testimony of an Internal Revenue Service (IRS) agent who reviewed a sampling of
tax returns that Frederick and Willie’s company prepared. The agent reviewed 283
returns with Schedule Cs, which was 10% of the returns with Schedule Cs that the
company prepared during a certain time period, and he found that 228 of those
returns reported business losses and requested a refund. Many of the 228 returns
also reported advertising and office expenses. The 228 returns, in total, reported
around $5 million in business losses. The remaining 55 returns reported business
profits.
According to the government, the similarities between the 228 tax returns
and the 16 fraudulent returns from trial established not only that all the 228 returns
were fraudulent but also that many other returns prepared by Frederick and Willie
were likely fraudulent. So the government asked the district court to calculate the
tax loss attributable to Frederick and Willie by extrapolating from the $5 million in
business losses reported by the 228 returns.
The government recommended a three-step calculation process. First,
because the IRS agent reviewed just 10% of returns with a Schedule C, multiply
the $5 million in business losses by 10 to estimate the total business losses reported
by Frederick and Willie. Second, multiply the resulting $50 million in estimated
business losses by 28% since, under the Sentencing Guidelines, a defendant’s tax
loss should be treated as equal to 28% of improperly claimed deductions “unless a
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more accurate determination of the tax loss can be made.” See U.S.S.G. §
2T1.1(c)(1)(B). Multiplying $50 million by 28% results in around $14 million in
estimated tax loss. Third, to afford Frederick and Willie the benefit of the doubt
that some of the returns reporting business losses were legitimate, cut the $14
million in estimated tax loss in half to $7 million.
The district court ultimately found that Frederick and Willie are responsible
for more than $3.5 million in tax loss and therefore applied to them a base offense
level of 24. See § 2T4.1(J), (K) (establishing 24 as the base offense level for an
offense involving tax loss greater than $3.5 million but less than $9.5 million).
The court noted that it is “very difficult” to identify the amount of tax loss
attributable to Frederick and Willie, but it nevertheless was “comfortable saying
that the loss” is above $3.5 million.
B. ANALYSIS
The district court erred in concluding that Frederick and Willie are
responsible for more than $3.5 million in tax loss. To establish that Frederick and
Willie are responsible for more than $3.5 million in tax loss, the government had to
at a minimum prove by a preponderance of the evidence that they engaged in
illegal conduct beyond preparing the 16 fraudulent tax returns identified at trial.
The government failed to make such a showing.
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The government argued that Frederick and Willie’s relevant “course of
conduct” included willfully preparing not only the 16 fraudulent tax returns but
also hundreds of additional fraudulent returns. See § 2T1.1 cmt. n.2. But the only
evidence it offered in support thereof was the IRS agent’s testimony, and the
testimony did not show that Frederick and Willie willfully prepared additional
fraudulent returns. The agent did not identify any returns containing fraudulent
information; the agent, for example, did not identify any returns that included non-
existent advertising or office expenses. The agent did not even state that, in his
opinion, the returns he analyzed included suspicious information. Nor did the
agent testify that he believed the returns he analyzed included patterns indicative of
fraud. The agent merely testified that Frederick and Willie’s company filed a
number of returns that shared certain characteristics with the 16 fraudulent
returns—characteristics such as reported business losses and requests for tax
refunds that are not uncommon in returns. Those shared characteristics, without
more, do not establish by a preponderance of the evidence that Frederick and
Willie willfully prepared additional fraudulent returns.2 See Cobb, 842 F.3d at
1219.
V. RESTITUTION
2
In some cases, similarities between returns identified as fraudulent and other returns
might be enough to establish the other returns as fraudulent—say, if the similarities rarely appear
in returns or the pool of fraudulent returns is sizable. But here, the similarities by themselves are
not sufficiently indicative of fraud to satisfy the government’s burden.
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The district court erred in ordering $3.5 million in restitution. The district
court based its award of restitution on its finding that Frederick and Willie are
responsible for more than $3.5 million in tax loss. Since the district court erred in
determining the amount of tax loss, it also erred in ordering $3.5 million in
restitution.
VI. CONCLUSION
We affirm in part, vacate in part, and remand for resentencing. We affirm
Frederick’s and Willie’s convictions but vacate their sentences. The district court
did not constructively amend Frederick and Willie’s indictment, did not err in
limiting Frederick’s cross-examination of a government witness, and did not err in
allowing Frederick and Willie to proceed pro se at sentencing. However, the court
erred at sentencing in finding that Frederick and Willie are responsible for more
than $3.5 million in tax loss and in ordering $3.5 million in restitution.
AFFIRMED IN PART, VACATED IN PART, AND REMANDED FOR
RESENTENCING.
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