February 8, 1993 United States Court of Appeals For the First Circuit
No. 92-1709
UNITED STATES,
Appellee,
v.
PAUL J. CASTELLONE,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Francis J. Boyle, U.S. District Judge]
Before
Selya, Circuit Judge,
Bownes, Senior Circuit Judge, and
Stahl, Circuit Judge.
Edward J. Romano with whom Michael Devlin was on brief for
appellant.
Stephanie S. Browne, Assistant United States Attorney, with whom
Margaret E. Curran, Assistant United States Attorney and Lincoln C.
Almond, United States Attorney, were on brief for appellee.
February 8, 1993
STAHL, Circuit Judge. Defendant-appellant Paul J.
Castellone pled guilty to a two-count information in which he
was charged with distribution of marijuana, in violation of
21 U.S.C. 841(a)(1). He was sentenced to 21 months of
imprisonment and three years of supervised release. In this
appeal, Castellone challenges his sentence on two grounds
related to the district court's calculation of the offense
level assigned to his conviction. Specifically, defendant
argues: 1) that the court erroneously included as relevant
conduct certain amounts of marijuana sold by a coconspirator;
and 2) that the court should not have ascribed to him a
managerial role in the offense. As we find these arguments
persuasive, and the government has candidly made us aware of
an apparent mathematical error in the offense level
calculation, we remand for resentencing.
I.
Background
Because Castellone pled guilty, we garner the
relevant facts from the probation officer's Pre-Sentence
Report (PSR) and the transcript of the sentencing hearing.
United States v. Garcia, 954 F.2d 12, 14 (1st Cir. 1992). In
early January 1992, Detective Michael Purro of the
Providence, Rhode Island, Police Department began an
undercover investigation of marijuana trafficking by
Castellone and Roland R. Chaput. Purro was assisted by an
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agent from the federal Bureau of Alcohol, Tobacco and
Firearms.
On January 9, 1992, Detective Purro, in his
undercover capacity, purchased one pound of marijuana from
Castellone for $2,200 ("the first sale"). The next day,
Purro purchased another pound of marijuana from Castellone
for the same price ("the second sale"). Both sales took
place in the late afternoon at a Dunkin Donuts on East Street
in Providence. Prior to the second sale, Purro followed
Castellone to the Dunkin Donuts parking lot and observed
Chaput arrive and enter Castellone's car. Purro then
approached Castellone's vehicle and introduced himself
directly to Chaput, whom he believed, correctly, as it later
turned out, to be Castellone's supplier.
At some point between January 10 and 16, Castellone
and Purro discussed a sale of five pounds of marijuana and a
handgun. Castellone told Purro that he had been in contact
with Chaput and would be able to execute the sale. Since law
enforcement officials considered Chaput to be a higher-level
dealer and a more important target than Castellone, Detective
Purro decided to exclude Castellone from any future deals,
and instead buy directly from Chaput. After obtaining
Chaput's phone number from a confidential informant, Purro
contacted him and after discussion was offered five pounds of
marijuana for $1700 per pound ("the third sale"). Castellone
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was totally unaware of the third sale or the direct contact
between Purro and Chaput.
On January 16, 1992, at approximately 6:30 p.m.,
Chaput, Purro, and two other men, Robert Laiter and Peter M.
Leite, all arrived at the Dunkin Donuts in separate vehicles.
Chaput retrieved a handgun from Laiter's car and delivered it
to Purro. Chaput, Laiter and Leite were all arrested as
Chaput was removing the marijuana from the trunk of Leite's
car. Law enforcement agents found five, approximately one-
pound packages of marijuana in the trunk.1
Castellone was not present at the third sale, but
was later arrested pursuant to a warrant. He subsequently
agreed to plead guilty to an information charging him with
the first two marijuana deals. He also agreed to assist the
government in its attempts to arrest others in the drug
trade. In return for his cooperation, the government agreed
not to charge him with conspiring with Chaput to distribute
marijuana. The plea agreement also indicated that the weight
of the two sales to which Castellone was pleading was 908.7
grams. Moreover, the government agreed it would not seek to
hold Castellone responsible at sentencing for the 2,300.3
grams or the firearm seized at the January 16, 1992, arrest.
1. The total weight of the five packages was 2,300.3 grams. As a pound contains 454 grams, the contraband slightly exceeded five pounds.
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Finally, the government agreed to recommend a sentence at the
low end of the applicable guideline range.
II.
Sentencing
In calculating Castellone's base offense level
("BOL"), the probation officer used a total quantity of 3209
grams of marijuana. This amount included the 2,300.3 grams
Chaput delivered to Purro at the third sale, as well as the
908.7 grams Castellone sold directly to Purro at the first
two sales. Applying the Sentencing Guidelines' Drug Quantity
Table, U.S.S.G. 2D1.1(c), the probation officer tabulated a
BOL of 12, applicable to quantities of marijuana between 2.5
and five kilograms. The BOL was increased by two levels for
Castellone's managerial role in the offense, U.S.S.G.
3B1.1(c), and decreased by two levels for acceptance of
responsibility. After assigning Castellone a criminal
history category of I, the probation officer concluded that
Castellone's offense level was 12, with a resulting guideline
range of 10 to 16 months.
Prior to sentencing, Castellone objected to the
inclusion of the 2300.3 grams of marijuana from the third
sale as relevant conduct, as well as to the two-level
adjustment for a managerial role in the offense. At the May
19, 1992, sentencing hearing, the defense put Detective Purro
on the stand to testify about, inter alia, Castellone's
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involvement--or lack thereof--in the third sale. At the
close of the hearing, the trial court expressed concern over
what it thought to be an inconsistency between the
government's plea agreement obligation not to hold Castellone
responsible for the third sale, and the probation officer's
statement that in response to Castellone's objection, the
government was prepared to present evidence regarding
Castellone's role in the third sale. Accordingly, the trial
court gave Castellone the option of withdrawing his guilty
plea. Castellone declined, and the sentencing hearing
reconvened on June 15, 1992, whereupon the government
reiterated its position that defendant was legally
responsible only for the 908.7 grams of marijuana from the
first two sales. The court, however, questioned the
government's decision to forego inclusion of the 2300.3
grams. In response, the government cited the plea agreement,
which, in turn, was based on its conclusion that the element
of foreseeability of the third sale, as it related to
Castellone, was "questionable." The trial court then ordered
further testimony from Purro, to elaborate on what, if any,
nexus existed between Purro and Castellone's last
conversation and the third sale.
Following Purro's testimony, and defense argument,
the court found that Castellone initiated the third sale and
that he took two actions in furtherance of that sale by
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initiating the negotiations with Purro and by communicating
Purro's marijuana and handgun order to Chaput. Based on
those findings, the court ruled that the third sale
constituted relevant conduct for which Castellone should be
held responsible.
Next, having heard argument regarding Castellone's
role in the offense, the trial court found that Castellone's
negotiations in the first two sales and involvement in the
third supported an offense level increase for a managerial
role. Castellone appeals these two findings.
III.
Discussion
At the outset, we note that remand is in order to
correct an apparent mathematical error in calculating
Castellone's offense level, irrespective of our decision on
the merits of the trial court's findings.2 A brief
explanation follows.
The court found that the third sale, involving the
2300.3 grams of marijuana and the handgun, was relevant
conduct for purposes of determining Castellone's offense
level. As noted, supra, p. 3, this amount of marijuana
yielded a BOL of 12. The firearm added two levels, to 14.
2. Although Castellone failed to raise this argument before the trial court, we do have jurisdiction to correct plain error. United States v. Morales-Diaz, 925 F.2d 535, 539 (1st
Cir. 1991).
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U.S.S.G. 2D1.1(b)(1).3 The court's ruling on Castellone's
managerial role added two more levels, resulting in an
adjusted offense level of 16. U.S.S.G. 3B1.1(c). Finally,
the court agreed that Castellone was entitled to a two-level
reduction for his acceptance of responsibility, U.S.S.G.
3E1.1(a), suggesting an offense level of 14, which, when
coupled with a criminal history category I, yields a
sentencing range of 15 to 21 months. U.S.S.G. 5, Part A,
Sentencing Table. The court, however, after factoring in the
relevant conduct, erroneously began with an offense level of
18, which it reduced to 16 based on Castellone's acceptance
of responsibility. Thereafter, consistent with the plea
agreement, the trial court sentenced Castellone at the
lenient end of the 21 to 27 month range called for by offense
level 16. While we might assume that the district court
would again follow the plea agreement and sentence Castellone
to the bottom end of the corrected guideline range, our other
rulings relative to the instant sentence require remand of
3. The PSR omitted reference to the firearm, and thus did not account for the two-point upward adjustment. The trial court, however, explicitly found that the gun, as part of the third sale, was relevant conduct attributable to Castellone. While Castellone does not specifically appeal the propriety of the handgun increase, he did object to and has appealed the inclusion of the third sale. The handgun increase, therefore, succeeds or fails concomitant with the third sale, without meriting separate discussion.
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this item as well.4 We turn now to the substantive issues
on appeal.
A. Relevant Conduct--The Third Sale
Pursuant to U.S.S.G. 2D1.1(c), the BOL for drug
trafficking offenses depends on the quantity of contraband
attributable to the defendant. For sentencing purposes, this
total includes the amount to which the defendant pleads
guilty, as well as any relevant uncharged conduct. Garcia,
954 F.2d at 15 (citations omitted). "[D]rugs not specified
in the count of conviction are to be included in determining
the offense level if they were part of the same course of
conduct or part of a common scheme or plan as the count of
conviction." U.S.S.G. 1B1.3, comment. (background). In
cases involving drug conspiracies, relevant conduct also
includes "all reasonably foreseeable acts and omissions of
others in furtherance of" the conspiracy. U.S.S.G.
1B1.3(a)(1)(B); Garcia, 954 F.2d at 15. In order to factor
the quantities associated with relevant conduct into the
sentencing formula, the government must establish by a
preponderance of the evidence that a sufficient nexus exists
between the conduct at issue and the offense of conviction.
United States v. Sklar, 920 F.2d 107, 110 (1st Cir. 1990).
4. Because of our decision today, the low end of the applicable guideline range may lead to a sentence not involving incarceration. We leave that decision to the district court.
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We will set aside the district court's findings on relevant
conduct only if they are clearly erroneous. United States v.
Camuti, 950 F.2d 72, 74 (1st Cir. 1991).
As he did below, Castellone argues here that the
government's decision to "cut him out" of the third sale and
deal directly with Chaput without his knowledge inoculates
him from responsibility for the sale. Castellone bases his
argument on the following undisputed facts. Castellone's
relationship with Purro was severed after only preliminary
conversations relative to the third sale wherein the two
never agreed that a sale would take place, or on a price for
such a sale. Furthermore, due to his own profit motive,
Castellone did not want Purro to deal directly with Chaput,
did not know Purro was going to do so, and did not know that
the third sale had occurred until after his arrest.
The trial court, however, found that Castellone and
Chaput had formed a conspiracy to sell marijuana, and that
Castellone initiated the negotiation for the third sale and
communicated Purro's third sale request to Chaput. The court
then determined that the third sale was both foreseeable to
Castellone and in furtherance of the conspiracy. Therefore,
the trial court concluded that the third sale was relevant
conduct for purposes of sentence calculation. Based on the
following, we disagree.
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In analyzing this situation, we find that two of
our recent decisions offer direction. In United States v.
Wood, 924 F.2d 399 (1st Cir. 1991), the defendant was
convicted of one narcotics sale. At sentencing, the district
court placed additional, uncharged sales into the relevant
conduct category. We ruled that an uncharged sale between
defendant's wife and a drug supplier, of which the defendant
had no knowledge until after the fact, could not be
considered relevant conduct for sentencing purposes. Id. at
404-05. We rested our decision on the fact that the
defendant "in no way conspired to facilitate the deal;
indeed, he had no knowledge that his wife was engaged in drug
transactions with anyone other than himself." Id.
Subsequently, we upheld a district court's decision to
include as relevant conduct drug sales between the
defendant's coconspirator and an undercover agent, despite
the fact that the defendant was not personally involved in
the later sales. Garcia, 954 F.2d at 16-17. A fair reading
of Garcia, however, indicates that the defendant and his
coconspirator worked as a team to sell drugs to the
undercover officer. As we noted:
"Garcia introduced [his coconspirator to
the undercover agent] for the express
purpose of facilitating drug transactions. He was aware of the nature
and salient details of the relationship
that developed between the two men.
There was no evidence of Garcia's affirmative withdrawal from the
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conspiracy or of any other intervening
event materially affecting the
trafficking calculus."
Id. at 16 (emphasis added). We stated that "the measure of a
defendant's accountability for drug transactions in which he
was not personally involved is usually congruent with the
scope of his agreement with the other participants in the
enterprise." Id. (citation omitted). We therefore
distinguished Wood on the ground that "Garcia's agreement
with his coconspirator [] could reasonably be said to
transcend the initial series of transactions." Id.
Here, with Wood and Garcia as our guideposts, we
find that Castellone was sufficiently detached from the third
sale so that it stands alone, and not as part of an overall
course of conduct. Based on our review of the record, we
doubt whether Castellone could have foreseen that the third
sale, about which he knew nothing, would take place as it
did, from Chaput directly to Purro. And although the
evidence supports the district court's conclusion that
Castellone and Chaput had formed a conspiracy to sell
marijuana, there is no evidence that the third sale was in
furtherance of a common plan between Castellone and Chaput.
Just as the defendant in Wood had no knowledge that his wife
dealt with anybody but him, Castellone had no reason to
expect Purro to deal directly with Chaput. The record is
clear that Castellone was little more than a street-level
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"retail" dealer, and that Chaput was his "wholesaler," rather
than his partner. This conclusion is supported by the
circumstances of the first two sales, wherein Castellone
bought marijuana from Chaput, and sold it to Purro for a
several hundred dollar profit.5 As for the third sale, the
record does not support the trial court's conclusion that
Castellone initiated the negotiations. Purro's testimony
indicated only that the two "had communication" after the
second sale, but is silent as to the instigator. Moreover,
while the record does support the finding that Castellone
told Chaput of Purro's interest in another sale, there is
nothing in the record to indicate that Castellone's call to
Chaput was anything other than part of the previous modus
operandi. In other words, after Purro made the request for
more marijuana and a gun, Castellone attempted to accommodate
him by contacting his supplier. There is nothing in the
record to indicate that Castellone's call to Chaput was
intended to facilitate the Chaput-Purro transaction. Indeed,
such a conclusion defies logic, because the record
demonstrates that Castellone's only source of narcotics-
related income was his own "retail" operation. Unlike the
defendant in Garcia, Castellone was in business for himself.
Also unlike the scenario in Garcia, Castellone never
5. The exact amount of Castellone's per-pound profit is disputed. Resolution of that issue, however, is insignificant to our analysis.
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introduced Purro to Chaput. Had events taken their usual
course, as Castellone had every reason to expect, Castellone
would have again purchased the contraband from Chaput,
factored in a profit, and re-sold it to Purro. Castellone,
however, never again discussed the sale with Purro, as he had
been, unbeknownst to him, bypassed. This is akin to the
"intervening event" adverted to in Garcia. Thus, there was
no evidence from which the court could properly find that the
third sale was in furtherance of a common scheme involving
Castellone and Chaput. Accordingly, we find the district
court's inclusion of the third sale as relevant conduct to be
clearly erroneous.6
B. The Managerial Role
Despite entreaties from both the defense and
government, the trial court assessed Castellone a two-level
increase in his BOL for his role as a manager of criminal
activity pursuant to U.S.S.G 3B1.1(c). Upon review of the
record, we find this increase legally insupportable.
At the outset, we note that the government bears
the burden of proving that an upward adjustment was
warranted. United States v. Ortiz, 966 F.2d 707, 717 (1st
Cir. 1992), cert. denied, 61 U.S.L.W. 3479 (U.S. Jan. 11,
6. We are not unmindful of our recent decision in United
States v. Moran, No. 91-1772 (1st Cir. Jan 20, 1993).
However, we view the facts of this case quite differently than those in Moran.
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1993) (No. 92-6552). To meet its burden, the government must
demonstrate that Castellone exercised "some degree of control
over others involved in the commission of the offense or he
must have been responsible for organizing others for the
purpose of carrying out the crime." United States v. Fuller,
897 F.2d 1217, 1220 (1st Cir. 1990). Here, we find the
record devoid of evidence of such control or organization.
On appeal, the government argues that Castellone determined
who purchased, when and where sales took place, prices, and
profit. Thus, the argument goes, it was Castellone's
decisions on those matters that effectuated his control over
when and where Chaput and others presented themselves. With
respect to the first part of the argument, the same can be
said of any independent, street-level dealer. In fact, no
street-level drug sale could ever be made without a customer,
a time and location for the sale, and a price. Furthermore,
the profit Castellone determined was his own, not Chaput's.
Moreover, the second part of the argument is unsubstantiated.
There is simply no evidence that Castellone exercised any
control over the movement of Chaput--or anyone else. In
ruling in favor of the increase, the trial court stated:
It's not necessary that a [d]efendant be the CEO of the operation to be in a managerial role. Here, there is no question but that the Defendant negotiated the first two transactions and began the negotiations for the third transaction, and along with Mr. Chaput, the transactions were carried out. It
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seems to me those facts do establish a managerial role on his part. . . .
Conspicuously lacking from the court's analysis, however, is
any finding that Castellone organized or exercised control
over others--that is, that he "managed" or "organized,"
within the meaning of section 3B1.1(c).7 We have recently
stated that an upward BOL adjustment "must be based on more
than the trial judge's hunch, no matter how sound his
instincts or how sagacious his judgment." Ortiz, 966 F.2d
707, 717 (1st Cir. 1992). The evidence in this case does not
support such an adjustment.
Appellant's sentence is vacated and the case is
remanded to the district court for resentencing in accordance
with this opinion.
7. By comparison, Chaput, who also received a two-level managerial role adjustment, was accompanied by his subordinates at the third sale.
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