Opinion
1:01 CR 166-1
September 26, 2001
MEMORANDUM OPINION AND ORDER
This matter is before the Court for the sentencing of Defendant Keowanna Vernie Chappelle Rigsbee Best, who pled guilty to Count 3 of a four-count Criminal Information charging her with willfully disclosing false documents to the Internal Revenue Service in violation of 26 U.S.C. § 7207. On August 27, 2001, Defendant appeared before this court, represented by Attorney R. Daniel Boyce. Assistant United States Attorney Hany L. Hobgood appeared for the Government. United States Probation Officer Robert S. Wright was also present.
At the sentencing hearing, the parties agreed upon the facts as stated in Paragraphs 4-13 of the Presentence Report ("PSR") as the relevant offense conduct. The Government moved to dismiss Counts 1, 2 and 4 of the Criminal Information, and the motion was granted. The Defendant's motion for downward departure pursuant to 18 U.S.C. § 3553(b) and § 5K2.0 of the United States Sentencing Guidelines ("Guidelines") was granted. For the reasons discussed herein, Defendant was sentenced to probation for a term of one year, with special conditions that she serve the first six months in home detention and the second six months under house arrest.
The Statement of Facts in this case indicates that in 1997, Defendant took over as the vice-president in charge of administration of Quality Communications. Quality Communications is acable installation contractor owned by Robert Rigsbee, Defendant's father. In 1997 and 1998, the company employed approximately 40 employees with approximately four million dollars in billing to customers. Part of Defendant's duties included ensuring that the company's federal tax liabilities were paid.
When Defendant began working for Quality Communications, the company was struggling financially and had come under the scrutiny of the Internal Revenue Service ("IRS") because of its failure to pay certain federal taxes in the preceding years. Primarily, these delinquent payments involved payroll taxes for 1995, but also involved some corporate income tax liabilities. A portion of the outstanding taxes was paid, with the exception of payroll taxes owed for the periods ending in June 1995, September 1995 and March 1996. On March 27, 1997, Quality Communications signed an installment agreement with the IRS that required monthly payments on the delinquent tax obligations and a commitment to remain current on all future tax obligations. Quality Communications was required to send copies on a monthly basis of all payroll tax deposit receipts to the local IRS office in Durham, North Carolina for monitoring purposes.
Between July 1997 and July 1998, through a series of fraudulent letters and documents, Defendant attempted to convince the IRS that Quality Communications was current on its tax obligations. The counts of the Information correspond roughly to the several occasions on which Defendant forwarded fraudulent letters to Quality Communication's certified public accountant who, in turn, forwarded the inaccurate information to the IRS. The letters related, at least in part, to nonpayments that occurred prior to Defendant's employment by Quality Commummtions. Under the Guidelines, Defendant is being held accountable for a tax loss totaling $169,817.12, representing the amount of payroll taxes owed by Quality Communications toward its tax liability.
Based on Defendant's guilty plea to the charge of disclosure of false documents to the IRS, the Presentence Report computed Defendant's Guideline base offense level at 15. This computation was made pursuant to § 2T1.1(a)(1) which, in turn, specifies the level corresponding to the tax loss under § 2T4.1. Defendant received a two-level decrease for acceptance of responsibility under Guideline § 3E1.1(a) and (b). The resulting level, 13, places Defendant in a Guidelines range of 12 to 18 months imprisonment. The maximum period for which Defendant may be incarcerated under the relevant criminal statute is one year.
Four days prior to the sentencing hearing, on August 23, 2001, Defendant filed a motion for downward departure so that she may serve any term of imprisonment in a non-custodial setting. In her brief and at the hearing, Defendant argued the following bases, individually or in combination, as justifying downward departure: (1) family circumstances, specifically, Delimdant's need to care for her husband who recently underwent brain surgery and her one-year-old chronically asthmatic daughter; and (2) the Guideline's overstatement of the seriousness of Defendant's conduct. The Government opposed the motion at the hearing, but expressly waived any objection regarding the timeliness of Defendant's motion.
During the sentencing hearing, Defendant took evidence from one witness, her husband, Terence Best. Mr. Best testified under oath as to the medical conditions of himself and the Bests' one-year-old daughter, Kyra. He produced relevant medical records to corroborate his testimony, which were admitted into evidence without Government objection. Mr. Best testified that he is 31 years old and has been married to Defendant for 3 1/2 years. Prior to Defendant's entering a guilty plea in this case, Mr. Best experienced no health problems. Subsequently, however, at a regular eye examination, a fist-sized tumor was discovered on his pituitary gland. On July 5, 2001, Mr. Best underwent like-threatening surgery to remove the tumor. Mr. Best's condition continues to be monitored by MRI every three months. He complained that he still experiences vision problems and other side effects.
Following the July 2001 surgery, Mr. Best underwent a second surgery to remove tissue from his stomach that was then grafted into his brain. He is slowly recuperating from this second surgery, but as yet is unable (and has been forbidden by his doctors) to lift anything, including his daughter. Mr. Best testified that the damage to his pituitary gland has interfered with his internal clock, and, as a result, he fatigues easily and is extremely difficult to rouse once he has fallen asleep. The fatigue caused by the surgeries and damage to his pituitary gland have prevented Mr. Best from returning to work full time as a Manager at Quality Communications. Typically, he works until 2:00 or 3:00 in the afternoon, and is in bed by 5:00 pm. He is unable to attend to household chores or care for his daughter. Ms. Best now earns the bulk of the family income, and it is her health insurance on which Mr. Best and Kyra depend to cover the approximately $17,000 in medical bills accumulated to date, as well as future medical bills.
As to the medical condition of the Best's one-year-old daughter, Mr. Best testified that Kyra suffers from asthma and uses a respirator. She suffered five colds this past summer and, on several occasions, Ms. Best had to rush her to the emergency room because the child was unable to breathe. When Kyra suffers an attack, she must be cradled and restrained by an adult for 15 minutes, with a mask placed on her face to enable her to breathe. Mr. Best is unable to perform this lifesaving task, due to his inability even to lift his child, let alone restrain her. Further, at night time, he is completely unable to assist in the care of his daughter, due to his fatigue. Since Mr. Best's surgeries, Defendant has assumed complete responsibility for the care of their daughter, picking her up from day care in the afternoon and caring for her through the night.
Mr. Best testified that his parents live an hour and a half from Durham and are not able to assist in his or his daughter's care. Although Ms. Best's parents, the Rigsbees, live approximately five minutes from the Bests, they are also unavailable to assist on a regular basis. Mr. Rigsbee, the owner of Quality Communications, travels extensively on business. Ms. Rigsbee is handicapped. The only other family member nearby is Defendant's younger brother, who works full time.
The Government had adequate opportunity to cross-examine Mr. Best and did so. The Court found Mr. Best to be a credible witness and accepted his testimony in full. After fully considering the testimony of Defendant's husband, counsels' argument, the Presentence Report, and Defendant's motion papers, the Court makes the following findings of fact and conclusions of law regarding Defendant's motion for downward departure.
A district court must impose a sentence of the kind and within the range that results from the proper application of the Guidelines "unless the court finds that there exists an aggravating or mitigating circumstance of a kind, or to a degree, not adequately taken into consideration by the Sentencing Commission in formulating the guidelines that should result in a sentence different from that described." USSG § 5K2.0 (quoting 18 U.S.C. § 3553(b)) (West 2000). In analyzing whether an argued basis for departure came within the contemplation of the Guidelines, the court must consider whether the factor is taken into account by the Guidelines, policy statements, or commentary. See Koon v. United States, 518 U.S. 81, 116 S.Ct. 2035, 2044 (1996); United States v. Wilson, 114 F.3d 429, 432 (4th Cir. 1997). The Sentencing Commission "`intend[ed] the sentencing courts to treat each guideline as carving out a "heartland," a set of typical cases embodying the conduct that each guideline describes'" and to consider as potential grounds for departure only those factors that take the case outside the heartland of cases to which the relevant guideline was meant to apply. Id.
As a starting point, the sentencing court should determine whether the factor(s) relied on for departure have been forbidden, encouraged, discouraged, or unmentioned by the Sentencing Commission as a possible basis for departure. See Koon, 518 U.S. at 96, 116 S.Ct. 2035, 2044; Wilson, 114 F.3d at 432. Forbidden factors may never be grounds for departure. See id. 116 S.Ct. at 2044-45; 114 F.3d at 433. Factors that are "encouraged," "discouraged," or "unmentioned" require further analysis, and potentially may provide a basis for departure under appropriate circumstances. See id. 116 S.Ct. at 2050; 114 F.3d at 433. In an extraordinary case, a combination of factors which are "not ordinarily relevant" to a departure decision may cause the case to "differ significantly from the `heartland' of cases in a way that is important to the statutory purposes of sentencing, even though none of the characteristics or circumstances individually distinguishes the case." USSG § 5K2.0, comment; see also United States v. Debeir, 186 F.3d 561, 566-67 (4th Cir. 1999).
In this case, Defendant has presented two bases for downward departure: unusual family hardship and overstatement of the seriousness of the Defendant's conduct. Family circumstances are identified in policy statements as "not ordinarily relevant" to a determination of whether the sentence should be outside the guideline range. See USSG § 5111.6. Accordingly, such circumstances support departure only "`in exceptional cases,'" e.g., where the factor is present to an exceptional degree or in some other way [that] makes the case different from the ordinary case where the factor is present." Koon, 116 S.Ct. at 2045 (quoting USSG § 511, intro. comment). Overstatement of the seriousness of the Defendant's conduct is an unmentioned factor, justifying departure only where "the structure and theory of both relevant individual guideline and the Guidelines taken as a whole" indicate that they take a case out of the applicable guideline's heartland. Id.
With regard to the "family circumstances" factor, the Fourth Circuit sets a very high bar for a finding of extraordinary family circumstances justifying a downward departure. See Wilson, 114 F.3d at 434 (citing numerous cases holding different family circumstances not extraordinary). The Court finds that in the present case, this hurdle has been cleared. The medical conditions of both Mr. Best and the Bests' infant daughter are serious and unresolved. Mr. Best has undergone two surgeries in the past three months for a brain tumor. He continues to undergo quarterly MRIs to ensure that the brain tumor does not recur. Defendant's one-year-old daughter suffers from asthma. Even if asthma is not viewed as extraordinary in the typical case, it certainly is extraordinary here, where the infant's condition requires constant monitoring, and the only available caretaker in Ms. Best's absence, Mr. Best, cannot administer the life-saving measures that may very likely be required. Due to his damaged pituitary gland, Mr. Best cannot be counted upon to awaken at night to care for his one-year-old daughter. Until the scars from his second, abdominal, surgery heal, he cannot even lift her.
Unlike prior cases in which the Fourth Circuit has renised to allow downward departure based on family circumstances, this case does not involve merely the "disruption" or "strain" ordinarily attendant to a twelve-month incarceration. The degree of care required for the Defendant's husband and child, Defendant's husband's inability to work full time or provide necessary medical insurance, the unavailability of any family member other than the Defendant to care for the infant, and the risk to the husband and child's well being are circumstances that remove this case from the heartland of cases covered by the Guidelines. Here, Defendant's spousal and parental relationships are gravely threatened; as observed by Judge Cacheris of the Eastern District of Virginia in a case bearing remarkable similarities to the present one, "the actual family structure stands to be utterly decimated by the realistic possibility of the death of not one, but two immediate family members while the Defendant is incarcerated and unable to provide any normal, day-to-day parental assistance to sustain [her] family." See United States v. Spedden, 917 F. Supp. 404 (E.D. Va. 1996)(Cacheris, J.).
With regard to Defendant's assertion that the sentencing guidelines overstate the seriousness of her conduct, this represents an unmentioned factor. Accordingly, departure is appropriate only if, taking into consideration the structure and theory of both relevant individual guidelines and the guidelines as a whole, the circumstances presented are sufficient to remove the case from the heartland of the applicable guideline. For the following reasons, the Court finds that this case is sufficiently atypical to remove it from the heartland of cases falling under the applicable Guileline, USSG § 2T1.1.
Under USSG § 2T.1.1(a)(1), Defendant's base offense level is determined by reference to the tax table corresponding to the tax loss. The "tax loss" in this case was determined by calculating the total amount of payroll taxes owed by Quality Communications toward their tax liability, with a resulting figure of $169,817.12. See PSR ¶ 11. Plugging this figure into the tax table at USSG § 2T4.1, the base offense level assigned to Defendant is 15.
The purpose of the applicable Guideline, which measures the seriousness of the defendant's conduct by the loss of revenue to the government, is to achieve uniformity in sentencing and provide deterrence of tax offenses. The commentary to § 2T1.1 provides, inter alia,
This guideline relies most heavily on the amount of loss that was the object of the offense. Tax offenses, in and of themselves, are serious offenses; however, a greater tax loss is obviously more harmful to the treasury and more serious than a smaller one with otherwise similar characteristics. Furthermore, as the potential benefit from the offense increases, the sanction necessary to deter also increases.
USSG § 2T1.1, comment, background. These goals mirror the primary goals of the Guidelines as a whole, which include uniformity, deterrence and punishment.
In the typical case, strict compliance with the tax table method must be understood to yield a fair result. For several reasons, the Court finds that this is not the typical case. First, it has been stipulated that both prior to and after Defendant's crime, Quality Communications, the only entity that could be said to "benefit" from the Defendant's conduct, has endeavored to comply with the IRS restitution plan. The Government has already recouped part of the loss from the company.
Second, Defendant Keowanna Best, as an employee acting on behalf of her employer, did not personally benefit from her conduct. Each of the examples cited under the Application Notes to the applicable Guideline involve tax losses that directly benefitted the actual defrauder. See USSG § 2T1.1, comment, application note, n. 1. While the absence of direct benefit to the offender certainly does not excuse the offender, it appears to be a consideration not adequately addressed by strict application of the loss/punishment criteria in this case. The relevant Guideline commentary, cited previously, states that "as the potential benefit from the offense increases, the sanction necessary to deter increases." USSG § 2T1.1, comment, background. By inverse reasoning, as the benefit from the offense decreases, the need to deter decreases. It has been stipulated that Defendant concealed the missed payments out of a desire to protect her father, the owner of the company. Though this motive is misplaced, and reflects a grave lapse in judgment that prompted conduct that should not be rewarded, Defendant's conduct need not be punished to the same extent as the self-serving conduct typically involved in tax offenses.
Finally, the need for deterrence is not as compelling where, as the Court is convinced here, it is virtually certain that the conduct will not be repeated. Ms. Best's motive was to protect her father. She no longer works for her father's company. She is now, notably, employed as a paralegal for a law firm in Cary, North Carolina. Ms. Best's continued employment in spite of her crime, indeed, her employment by a law firm, suggests that this Court is not alone in its firm belief that Ms. Best will not repeat her crime.
In conclusion, the Court is persuaded that the special circumstances urged by Defendant, including her husband's and child's life-threatening medical conditions and the applicable Guideline's overstatement of her conduct, either individually or cumulatively take this case out of the Guidelines' heartland. Reducing Defendant's offense level by three points places her in a level in which she is eligible for probation. imposition of special conditions of six months of home detention and six months house arrest serves to punish Ms. Best and, simultaneously, place her in a position to attend to the extraordinary medical needs of her husband and child.
Accordingly, for the reasons discussed herein,
IT IS ORDERED that Defendant is sentenced to a term of one year of probation.
IT IS FURTHER ORDERED that, in addition to the general conditions of probation, the following special conditions shall apply: that Defendant shall serve six the first (6) months of her probationary sentence in home detention and the second six (6) months under house arrest.
IT IS FURTHER ORDERED that Defendant shall pay a special assessment of $25.00. A separate judgment will be entered contemporaneously with this Memorandum.