United States v. William Hanhardt, Joseph Basinski, Guy S. Altobello, and William R. Brown

Citation: 361 F.3d 382Docket: 02-2253, 02-2254, 02-2465, 02-3091, 02-3625

Court: Court of Appeals for the Seventh Circuit; May 7, 2004; Federal Appellate Court

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William Hanhardt, Joseph Basinski, Guy Altobello, and William Brown were indicted on charges of racketeering conspiracy under 18 U.S.C. § 1962(d) and conspiracy to transport stolen property under 18 U.S.C. § 371. The indictment also sought the forfeiture of $4,845,000 along with various jewelry and real estate assets. All defendants pleaded guilty, receiving sentences ranging from 25 to 188 months. 

The case details a nationwide operation from 1980 to April 1998, led by Hanhardt, targeting jewelry salespersons traveling with goods worth over $40 million. The group committed at least nine thefts totaling over $5 million across several states, including California and Michigan. Hanhardt directed surveillance and information gathering on potential targets, utilizing his former position as a Chicago police officer to access law enforcement databases. Basinski assisted in identifying targets and recruiting members, while Altobello provided critical information about salespersons connected to his jewelry business.

In a separate scheme in 1996, Brown joined Hanhardt, Basinski, and Schiro to steal watches valued at $500,000 from salesman Paul Lachterman, marking a repeated targeting of the same individual from a prior theft in 1984. The appellate court affirmed some decisions but reversed others, remanding the case for new sentencing consistent with the ruling.

Between April and September 1996, four conspirators stalked Lachterman, gathering information and making a duplicate key to his car trunk. On October 1, they followed him to Wisconsin and then to Indiana, where they stole a case of watches valued at $58,000, provided by the FBI. Upon discovering the case contained less value than expected, they returned it to the trunk. All conspirators pleaded guilty and received prison sentences ranging from 25 to 188 months, which they are appealing. 

Hanhardt and Basinski contest their responsibility for a 1995 armed robbery of Esagh Kashimallak, asserting the court's finding was incorrect. During their sentencing, the government indicated that the conspiracy included the robbery, seeking sentence enhancements for physical restraint, weapon use, and bodily injury. The court found Hanhardt responsible based on credible testimony but declined to impose enhancements, sentencing him to the upper end of the guideline range (151-188 months). A week later, Basinski was also found responsible and received a similar high-end sentence (87-108 months). The court did not link the high-end sentences to the robbery findings. 

The district court's decision on responsibility is subject to a clear error review standard, and its credibility determinations are granted deference. The court did not increase either defendant's offense level based on the robbery, and since the defendants did not request specific findings during sentencing, they waived this issue. 

Furthermore, both Hanhardt and Altobello were sentenced at higher offense levels for obstructing justice. This determination is reviewed de novo, but the court found the enhancements for obstruction of justice applied to them were clearly erroneous.

Hanhardt's trial was scheduled for October 16, 2001, shortly after he underwent surgery for testicular cancer. On the trial date, his attorney requested a continuance due to Hanhardt's inability to attend court, which was later revealed to be due to an attempted suicide by drug overdose, resulting in his hospitalization. The court held Hanhardt accountable for his absence and issued an arrest warrant but stayed its execution until October 20, 2001, contingent on his appearance.

On October 18, 2001, the government informed the court that Hanhardt had arranged for inpatient treatment that would prevent him from attending court on the 20th. The government alleged that Hanhardt was deliberately trying to violate the court's order. The court executed the arrest warrant and scheduled a trial for October 25, indicating that Hanhardt had no intention of appearing on the 20th due to his hospitalization.

During sentencing, the court enhanced Hanhardt's offense level by two for obstruction of justice under U.S.S.G. 3C1.1, citing his willful and intentional actions to avoid court appearances. The court emphasized that Hanhardt's voluntary drug use and subsequent suicide attempt were deliberate acts that impeded the prosecution's case.

However, the decision to impose this enhancement was challenged. A review of the evidence suggested that classifying Hanhardt's suicide attempt as obstruction of justice was erroneous. It was argued that his actions demonstrated a specific intent to end his life, not to evade court. Previous case law indicated that an attempted suicide should not be construed as obstruction of justice. The U.S. Probation Officer supported this view, reinforcing that Hanhardt's intent was to die rather than to avoid court.

If the defendant's intention was solely to avoid a court hearing, he could have simply failed to appear or fled. Instead, he attempted suicide, indicating that his actions were driven by more than just a desire to miss court. The nature of suicide complicates understanding individual motivation, which generally points to an intent to end one’s life. The court agreed with U.S. Probation's view on the matter and reversed the district court's decision to enhance the defendant's sentence based on obstruction of justice.

During sentencing, Altobello received a two-level sentence increase for obstruction of justice under U.S.S.G. 3C1.1, which applies if a defendant willfully obstructs or impedes justice during an investigation or prosecution. The government sought this enhancement due to unsworn false statements Altobello made to FBI agents in 1998. Although he admitted to being involved in a "bad thing," he denied other criminal activity and associations. The district court found that Altobello's contradictory statements constituted obstruction.

The appellate court disagreed, vacating the enhancement. It noted that not all obstructive conduct warrants an enhancement and specifically stated that false statements made out of court do not automatically qualify for such treatment unless they significantly obstruct an investigation. The government failed to prove that Altobello's statements had a significant impact on the investigation, relying instead on the potential for obstruction rather than evidence of actual impediment. No government agents testified that his statements caused significant investigative hindrance, leading to the conclusion that the obstruction of justice enhancement should be vacated.

The district court denied downward adjustments for acceptance of responsibility for defendants Hanhardt and Altobello during sentencing, and this decision was affirmed upon review. The standard for evaluating acceptance of responsibility is a context-specific inquiry that affords great deference to the sentencing judge's determination, which will not be disturbed absent an abuse of discretion.

Hanhardt entered a blind plea on October 25, 2001, shortly before trial, and was the last of five defendants to plead guilty. His statement admitted to the offense's elements, but he expressed disagreement with the government's evidence, specifically denying guilt to Count One. The court found that Hanhardt's conduct did not demonstrate true contrition, leading to the denial of a downward adjustment based on Section 3E1.1 of the sentencing guidelines.

Altobello was also denied a downward adjustment due to his false denials regarding his involvement in a theft conspiracy. Although he pleaded guilty and acknowledged providing information about traveling salespersons to a co-conspirator, he downplayed the extent of his involvement despite substantial evidence against him. The court concluded that he was not truthful about his participation, affirming the denial of acceptance of responsibility.

Finally, the appellate court noted that under 18 U.S.C. § 3742(e), it must accept the district court's factual findings unless clearly erroneous and will grant deference to the district court's application of sentencing guidelines.

The district court enhanced the defendants' sentences under sentencing guideline 2B1.1(b)(2) due to evidence from two jewelry thefts. In the first incident on June 30, 1992, Melvin Draftz had his briefcase, containing $1.3 million in jewelry, stolen after being bumped. Similarly, on May 7, 1994, Roland Naftule experienced a theft after being distracted in a comparable manner. The court determined that the circumstances warranted an enhancement for theft from a person, as defined under the guidelines, which includes non-forcible thefts where property was within the victim's reach. The court affirmed that the victims' bags were indeed within reach, rejecting claims of clear error.

Defendant Altobello contested the application of this enhancement, asserting he was not involved in the specific thefts and that the court misapplied conspiracy law. However, the court concluded it was foreseeable that thefts from victims would occur, and Altobello was accountable under Pinkerton conspiracy principles, regardless of his specific knowledge of the thefts. The court found that the circumstances of Naftule's theft were foreseeable to Altobello, justifying the enhancement.

The court's decision to apply an organized crime upward departure for defendants Basinski, Altobello, and Brown was reviewed de novo, while factual findings were assessed for clear error. The Chicago Outfit, an organized crime group, was identified as having significant influence in illegal activities, including theft. The defendants were linked to the Outfit's Ogden/Grand Avenue crew, and evidence from informants confirmed their involvement in organized crime-related jewelry thefts. At sentencing, it was determined that organized crime connections were utilized during the commission of the offenses, leading to a two-level upward departure for the defendants.

Membership or association with organized crime can justify an upward departure in sentencing if used to further criminal activity. Defendants argued against their claimed connection to organized crime, challenging the reliability of unsworn informant statements, but the court found sufficient corroboration in the evidence, including the Hanhardt stipulation and DeStefano's agreement. Consequently, the court affirmed the upward departure for Basinski, Altobello, and Brown due to their links to organized crime.

Basinski received a four-level sentence adjustment for his role as a leader in the conspiracy, as permitted under Guideline 3B1.1(a). The court determined that both Basinski and Hanhardt were leaders, supported by wiretap evidence showcasing their decision-making authority. They organized thefts, targeting jewelry salespersons, and involved both willing and unwitting accomplices in their plans. Basinski contested the adjustment, arguing insufficient findings by the district court; however, the court confirmed it considered the entire record, including a comprehensive proffer and plea agreements, leading to the conclusion that both men were leaders of the conspiracy.

Additionally, Altobello's request for a two-level downward adjustment for minor participation was denied. The court's decision regarding a downward adjustment is based on factual determinations and is reviewed for clear error. A minor participant is defined as one substantially less culpable than others involved in the crime for which they were convicted, not merely in relation to a broader conspiracy.

A defendant seeking a downward adjustment for a minor role in a criminal offense must prove by a preponderance of the evidence that they qualify for such reduction. In Altobello's case, the district court determined he played a significant role in the conspiracy by providing crucial information that enabled other conspirators to target victims. Altobello's claim of lesser culpability due to not participating in all activities was insufficient to meet his burden. The court found that Altobello's involvement in the conspiracy began no later than the 1993 robbery of Kashimallak, with all subsequent thefts being reasonably foreseeable to him. This finding was deemed reasonable and not clearly erroneous, leading to the affirmation of the denial of a minor role adjustment. The court's use of the 1997 Federal Sentencing Guidelines was appropriate, and it ruled that evidence supporting a sentence enhancement for obstruction of justice was also valid. The decision includes a partial affirmation, a reversal, and a remand for new sentencing aligned with the opinion. The legal standards for determining a minor participant focus on culpability relative to co-participants in the specific offense rather than a broader conspiracy context.

In United States v. Soto, the district court determined that Altobello played a crucial role in a conspiracy by supplying information that allowed conspirators to identify and target victims, particularly at industry trade shows frequented by traveling wholesale jewelers. Altobello provided detailed insights about salespersons, including their merchandise worth over $2 million, transportation methods, schedules, and vehicle details. The court found Altobello’s contributions significant enough to classify him as an important member of the conspiracy. His argument for being less culpable due to limited participation was rejected, as the court affirmed that his involvement met the threshold of complicity. Furthermore, the district court established that Altobello joined the conspiracy as early as the 1993 robbery of Kashimallak, with subsequent thefts being foreseeable to him. This determination was upheld upon review, and the overall findings of the district court were deemed reasonable and not clearly erroneous. Consequently, the appellate court affirmed in part, reversed in part, and remanded for new sentencing. The document also notes that the district court correctly applied the 1997 Federal Sentencing Guidelines and discusses the enhancement of sentence for obstruction of justice based on the defendant's actions in custody.