United States v. Duane Montgomery

592 F. App'x 411
CourtCourt of Appeals for the Sixth Circuit
DecidedNovember 24, 2014
Docket13-2596
StatusUnpublished
Cited by9 cases

This text of 592 F. App'x 411 (United States v. Duane Montgomery) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Duane Montgomery, 592 F. App'x 411 (6th Cir. 2014).

Opinion

MERRITT, Circuit Judge.

Defendant Duane Montgomery challenges the district court’s imposition of an above-Guidelines sentence after a jury convicted him of fraudulently obtaining funds set aside for victims of the Deepwater Horizon oil spill. Specifically, this case asks us to decide whether the district court’s initial Sentencing Guidelines calculation of 108-135 months was procedurally reasonable based on enhancements of intended loss, sophisticated means, , and obstruction of justice. We are also asked to consider whether the district court’s upward variance to a 180-month sentence was substantively reasonable. For the reasons that follow, we AFFIRM.

I. Factual Background

In May 2010, the BP Deepwater Horizon oil rig exploded and released millions of barrels of crude oil into the Gulf of Mexico. In response to one of the worst ecological disasters in American history, BP and Congress set aside billions of dollars to help the victims. Beginning in June 2010 and continuing through his trial and sentencing, Defendant Duane Montgomery — a Michigan resident — fraudulently sought to obtain millions of dollars from these victim funds. All told, Montgomery filed five false claims for property damage and lost revenues with three different entities. As the common basis for each claim, Montgomery falsely reported that he had been performing a “pollution monitoring” job for his company in the Gulf of Mexico when tar balls from the oil spill destroyed his boat’s engines, casting him adrift at sea for 15 days.

The evidence presented at trial proved Montgomery’s claims to be completely untrue. He did not own a boat at the time, and certainly was not working in the Gulf dining the oil spill. Indeed, the evidence proved Montgomery was actually in Michi *413 gan on numerous occasions during the period. As a result, a jury convicted him of three counts of mail fraud in violation of 18 U.S.C. § 1341.

Count One — BP Claim for $43,856.79:

In June 2010, Montgomery submitted a property damage claim to BP for $43,856.78 for alleged damage to his company boat’s engines. He supported this assertion with a boat registration obtained the day before he submitted the claim, an “invoice/repair order,” bogus financial statements, and corporate income tax returns purportedly filed by his company showing gross receipts of $8.7 million in 2008 and $12 million in 2009. In fact, these purported IRS documents were complete fabrications: the company never filed any tax returns, the EIN number was false, and Montgomery — the purported owner and CEO — filed no income tax returns and collected unemployment compensation during these years.

Montgomery also submitted a copy of an $8,109.00 GEICO insurance check as purported reimbursement for towing fees he received after his boat was disabled. In reality, GEICO had made this payment for a motorcycle Montgomery reported stolen in Michigan during the time he claimed to have been marooned in the Gulf of Mexico. In efforts to explain evidence that he was in a Michigan court for custody proceedings on dates he claimed to be working in the Gulf, Montgomery stated that he often drove his motorcycle overnight from New Orleans, sometimes “twice a week,” to attend court proceedings in Detroit. The GEICO claim forms he filed when his motorcycle was stolen, however, showed an odometer reading of only 800 miles — fewer than a single one-way trip.

Montgomery’s mailing of this property damage claim to BP for $43,856.78 formed the basis for count one of the conviction.

Count Two — GCCF Check for $43,900.00 and Related Claims:

In August 2010, Montgomery filed an online claim with the Gulf Coast Claims Facility (“GCCF”), an agency created and funded by BP to respond to the economic crisis caused by the spill. This filing renewed his $43,856.78 property damage claim and sought an additional $37,475.88 in “lost company profits.” Two months later, the GCCF sent an emergency advance payment of $43,900 to Montgomery’s Livonia, Michigan commercial mailbox service, which was promptly retrieved and deposited by a friend at Montgomery’s request. The mailing of this check provided the basis for Montgomery’s second count of conviction.

Less than a month later, Montgomery submitted a second claim to the GCCF based on the same incident but seeking increased amounts of $65,343.22 for property damage and $216,539.00 in lost profits. While this second claim was pending, in February 2011, Montgomery submitted yet another claim to the United States Coast Guard-administered National Pollution Funds Center (“NPFC”), 1 seeking $115,460.00 for property damage and $746,082.00 in lost earnings — a total of $861,512.00. Montgomery supplemented his original GCCF submission with an overview of the damage claim, a photocopy of an Ohio driver’s license bearing a false social security number, receipts for engines he had ordered, work orders, photographs of engines being removed from the boat he claimed had been damaged by the oil spill, and seven pages of “task site logs” purporting to prove, by latitude and longi *414 tude tracking, that he had been in the Gulf of Mexico from March through May of 2010. In reality, Montgomery had recently negotiated for the purchase of a 65-foot power sailboat in Delaware, ordered twin diesel engines to refurbish it, and submitted pictures taken during that process to support his fraudulent claim. The task site logs, although authentic in appearance, were complete fabrications. After the Coast Guard denied the claim, Montgomery filed a $1 million personal injury claim with the GCCF asserting that, while marooned in the Gulf of Mexico, oil dispersant used in the cleanup caused injury to his eye. 2

Count Three — NPFC Request for Reconsideration of Denial of Claims:

In June 2011, Montgomery submitted a 99-page “Request for Reconsideration” of the NPFC’s denial of his initial $864,512.00 claim along with a demand for $2,584,586.00 (three times his claim) for what he alleged was the NPFC’s wrongful denial of his earlier claim. This document resembled a complaint for a lawsuit and bore two titles: “Request for Reconsideration” and another that had been stricken but remained visible: “Complaint and-Jur-y Demand.” In it, Montgomery repeatedly accused the Coast Guard of lying in its claims determination, abusing its discretion, and withholding his claim for $861,512.00 in an “arbitrary and capricious” manner. In addition, the request stated: “The Plaintiff also seeks monetary damages in the amount of $2,584,536.” This request was the basis for the third count of conviction.

After the NPFC denied the Request for Reconsideration, in September 2011, Montgomery filed a civil lawsuit against the United States. Coast Guard and the director of the NPFC, again seeking $2,584,586.00 in monetary damages for an “intentional and willful” violation of the law in denying his claim for $861,512.00. This still-pending 3 civil suit is based on the same allegations proven false in this criminal case.

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592 F. App'x 411, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-duane-montgomery-ca6-2014.