UNITED STATES of America, Plaintiff-Appellee, v. Hector ZUNIGA, Defendant-Appellant

Citations: 66 F.3d 225; 95 Cal. Daily Op. Serv. 7329; 95 Daily Journal DAR 12493; 1995 U.S. App. LEXIS 26138Docket: 94-50416

Court: Court of Appeals for the Ninth Circuit; September 18, 1995; Federal Appellate Court

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Hector Zuniga appeals a 30-month prison sentence for conspiracy to possess stolen goods, in violation of 18 U.S.C. § 371, arguing that the district court improperly applied Sentencing Guidelines section 2B1.1(b)(5)(B) by increasing his offense level on the grounds that he was "in the business of receiving and selling stolen property." The case stems from an FBI undercover operation targeting thefts from rail yards and trucking companies in Los Angeles. An undercover agent received a call from an associate of Zuniga, indicating the need to store stolen goods. 

On April 19, 1992, Zuniga, along with co-defendant Fernando Santos Ramirez, stole a tractor-trailer loaded with 254 cases of American Airlines travel kits valued at $77,000. Zuniga subsequently contacted the undercover agent to negotiate the sale of the stolen kits for $5,000, revealing the involvement of other accomplices and previous transactions involving stolen merchandise.

Further interactions on July 30 and 31, 1992, included Zuniga offering to store additional stolen goods, such as women's hair spray and automobile rims, and facilitating sales of stolen items, including a shipment of shorts. The evidence presented indicated Zuniga’s active participation in the theft and sale of stolen property, reinforcing the district court's sentencing decision.

Zuniga expressed intentions to steal electronics and previously assisted in stealing merchandise in San Francisco, which was subsequently transported to Los Angeles. He was charged with conspiracy and possession of stolen goods from interstate shipments, involving $77,000 worth of airline travel kits and $115,000 worth of wheel rims. On March 15, 1994, he pleaded guilty to one count from each indictment, while the second counts were dismissed. The Presentence Report recommended a four-level enhancement due to Zuniga's involvement in the business of receiving and selling stolen property, which the district court confirmed. After reducing the enhanced offense level for acceptance of responsibility, Zuniga's total offense level was set at 14, leading to a sentencing range of 27 to 33 months. He received a 30-month concurrent sentence and a three-year supervised release. 

The standard of review for the district court's application of the Sentencing Guidelines is de novo, particularly regarding legal determinations about whether a prior conviction falls under the Guidelines. The factual findings in sentencing are reviewed for clear error. There is a dispute between Zuniga and the government over the standard applied to his sentence enhancement under section 2B1.1(b)(5)(B). Zuniga argues for a legal review, while the government seeks a factual review. The resolution requires both legal and factual determinations, leading to the application of a de novo standard. Zuniga does not contest the facts but questions whether they sufficiently support the finding that he was "in the business of receiving or selling stolen property."

Section 2B1.1(b)(5)(B) enhancement, previously 2B1.2(b)(4)(A), has not been addressed by this Circuit. The Background indicates that receiving stolen property is treated similarly to theft, with enhancements for those reselling stolen property due to the likelihood that the property value underrepresents their criminal involvement and facilitation of other crimes. Two tests for applying this enhancement have emerged among circuits: the "fence" test and the "totality of the circumstances" test. The "fence" test, used by the Fifth, Sixth, and Seventh Circuits, requires the government to prove the defendant was in the business of buying and selling stolen property. Conversely, the "totality of the circumstances" test, favored by the First and Third Circuits, assesses the regularity and sophistication of the defendant's operations. 

In this case, the government asserts that Zuniga was involved in trafficking stolen property, evidenced by his lack of legitimate income, access to stolen cargo, communications about obtaining additional stolen property, and prior convictions related to stolen property offenses. Zuniga contends that mere possession of stolen merchandise does not justify the enhancement, arguing it applies only to those operating as professional fences. He also provided evidence of legitimate employment and contested the relevance of his prior theft convictions to the current enhancement assessment. The court adopts the "totality of the circumstances" test for evaluating the enhancement's application.

The district court determined that Zuniga's operation, characterized by regularity and sophistication, warranted an enhancement under the "totality of the circumstances." Evidence indicated that Zuniga was involved in warehousing and selling stolen merchandise, both his own and that acquired from others, classifying him as a "fence." This conclusion was supported by a preponderance of the evidence and was not clearly erroneous. Zuniga admitted possession of large quantities of stolen goods, and his extensive operations spanned a significant duration and geographical area, involving multiple accomplices. The court also considered Zuniga's prior convictions related to property theft and the sale of stolen property, affirming his status as being "in the business." The application of the enhancement under section 2B1.1(b)(5)(B) was justified, given Zuniga's history of significant illegal conduct. The district judge's factual findings and legal conclusions were upheld, affirming the district court's decision.