Unpublished Disposition, 902 F.2d 1580 (9th Cir. 1990)

No. 89-10317.

United States Court of Appeals, Ninth Circuit.

Before BEEZER and KOZINSKI, Circuit Judges, and ROBERT C. BONNER,^**  District Judge.

MEMORANDUM^*** 

Dennis Wayne Merri appeals his sentence under the Guidelines, following a guilty plea, for making counterfeit notes, in violation of 18 U.S.C. § 471. Merri argues that the district court erred in finding that he had been an organizer or leader in a criminal activity that involved five or more participants. We affirm.

* On January 7, 1989, United States Secret Service agents were told by a confidential informant that George Hickey, John Robbins, and "Dennis" had printed counterfeit Federal Reserve notes at Dennis' print shop on Auburn Boulevard in Sacramento. When the agents interviewed Robbins on January 13, 1989, he admitted that he had helped Dennis Merri and George Hickey make and pass counterfeit $20 notes. According to Robbins, Merri had approached Hickey in 1988 about forming a print shop partnership. Merri suggested to Hickey that they finance a part of the business by counterfeiting money. Hickey told Robbins that Merri had already printed $250,000.

Robbins told the agents that he and Hickey had agreed to help Merri print more counterfeit $20 notes. Merri was responsible for making the printing plates and supplying the printing press, while Hickey and Robbins were to do the printing. On January 1, 1989, Robbins and Hickey printed approximately $20,000 in counterfeit $20's on a printing press supplied by Merri. Merri then did the final cutting of the printed notes. Merri kept 50% of the counterfeit notes and Hickey and Robbins split the rest. Robbins said he and Hickey spent about eight of the counterfeit notes, but became nervous and burned the remainder in Hickey's fireplace along with the plates and negatives.

Based on Robbins' admissions, the agents obtained a search warrant for Hickey's house. There they found the charred remnants of counterfeit Federal Reserve notes in the fireplace. The agents also searched Merri's house, but did not find any counterfeit notes there. However, Merri's girlfriend, who was present at the house, admitted that Merri had told her in December, 1988 that he was counterfeiting money and had later shown her some of the counterfeit notes. The agents also seized approximately .19 grams of methamphetamine from a coin purse on the premises.

When Merri was interviewed, he admitted that he had printed approximately $30,000 in counterfeit $20's by himself in October of 1988. Merri claimed the notes were of such poor quality that he burned them along with the negatives and plates. He also admitted that he, Robbins, and Hickey had printed an additional $20,000 in a print shop that Merri had purchased on Auburn Boulevard in Sacramento. Merri admitted making the plates and negatives, but claimed he destroyed them when they were done.

The agents later located two juvenile females who stated that they had spent the weekend of January 6th-8th with Merri and co-defendant Gipson at two Sacramento area motels. The two young women stated that they had met Gipson at a bowling alley and had accepted his invitation to "party" with him and his friend. They spent the night drinking beer with Gipson and Merri. They said that in the morning, Gipson and Merri gave some of the counterfeit $20's to them so they could purchase clothes. The young women also bought small items and gave the change to Merri and Gipson. On the following day, they were given some counterfeit $20's and bought numerous items at different stores. They stated that Gipson and Merri kept the $20's in their wallets and in a gray briefcase that was in Gipson's car.

When the agents questioned Gipson, he told them that Merri had come to him, told him that he had $10,000 in counterfeit $20's, and suggested that they use the notes to "party". Gipson admitted going to the bowling alley and bringing the two young women back to a room that he and Merri had rented. Gipson said Merri explained to the young women that the money was counterfeit. Gipson also admitted that he had spent approximately half of the $10,000.

II

Merri argues that the district court erred in raising his offense level by four points under Federal Sentencing Guidelines Sec. 3B1.1. The Guideline provides:

Based on the defendant's role in the offense, [the court should] increase the offense level as follows:

(a) If the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive, increase by 4 levels.

Merri contends that Sec. 3B1.1(a) is inapplicable as he did not supervise five or more participants. He claims that the counterfeiting operation in which he participated along with Hickey and Robbins had effectively ended at the time that they divided the money among the three of them. He denies having any leadership role with respect to Gipson and the two young women.

We must "give due deference to the district court's application of the Guidelines to the facts." 18 U.S.C. § 3742(e). Where as here "the inquiry is a purely factual one, the 'clearly erroneous' standard applies." United States v. Anderson, No. 89-10059, slip op. (9th Cir. Feb. 8, 1990); see also 18 U.S.C. § 3742(e). A district court's finding of fact is clearly erroneous only if, after viewing all of the evidence, we are left "with the definite and firm conviction that a mistake has been committed." Anderson v. Bessemer City, 470 U.S. 564, 573 (1970).

Because Merri's offense is specifically included in Guideline Sec. 3D1.2(b), the "criminal activity" in question includes not only the act of counterfeiting to which he pleaded guilty, but also "acts and omissions that were part of the same course of conduct or common scheme or plan...." Thus, the court correctly considered Merri's activities in distributing the notes along with his activities in producing them.

In determining whether a defendant was a leader or organizer, courts are to consider among other factors "the nature of participation in the commission of the offense, the recruitment of accomplices, [and] the claimed right to a larger share of the fruits of the crime." Guidelines Sec. 3B1.1, Application Note 3; see also United States v. Fuller, No. 89-1880, 1990 U.S.App.Lexis 3555 (1st Cir. March 12, 1990, as amended March 13, 1990). Here the district court found that Merri had recruited Hickey and, through Hickey, Robbins, to assist him in the printing of the notes. Merri admitted recruiting Hickey, and also admitted that he had done most of the work by making the negatives and the plates, providing the printing press, and cutting the notes. Hickey and Robbins merely ran the presses. Merri further admitted that he had received half of the $20,000 that was printed while Hickey and Robbins split the other half.

The evidence also supports the court's finding that Merri's role as leader or organizer further extended to the distribution of the notes by Gipson and the two young women. Gipson stated that Merri had approached him, explained that he had a large amount of counterfeit money, and asked for his help in using the notes to "party". The two young women stated that both Gipson and Merri had given them notes to pass. According to Gipson, Merri explained to them that the notes were counterfeit. In his declaration, Merri denied having sexual relations with the young women but did not deny that he had recruited Gipson to help him spend the money and had encouraged Gipson to get a couple of young women to help them "party" with the money.

However, Merri contends that Gipson took some of the notes without his encouragement, went out alone and picked up the two young women. He claims that Gipson and the young women made various purchases with the notes and then returned to the motel room where they drank beer and took methamphetamine while he slept.

The evidence, particularly the statements of Gipson and the two young women, supports the district court's findings of fact. The court's finding that Merri was a supervisor or organizer of a criminal activity that involved five or more people is not clearly erroneous. Consequently, the district court's decision applying Sec. 3B1.1(a) to Merri's sentence is

AFFIRMED.