                                                                                                                           Opinions of the United
1995 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


5-22-1995

United States v Felton
Precedential or Non-Precedential:

Docket 94-5431




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                    UNITED STATES COURT OF APPEALS
                        FOR THE THIRD CIRCUIT
                        _____________________

                             No. 94-5431
                        _____________________

                       UNITED STATES OF AMERICA

                                  v.

                            DENNIS FELTON
                              Appellant
                        _____________________

         On Appeal from the United States District Court
                  For the District of New Jersey
                (D.C. Crim. Action No. 93-cr-209)
                      _____________________

                       Argued February 16, 1995

          Before:     STAPLETON and COWEN, Circuit Judges,
                      and HUYETT, District Judge*

                      (Opinion Filed   May 22, 1995   )

Chester M. Keller (argued)
Assistant Federal Public Defender
972 Broad Street
Newark, New Jersey 07102

               Attorney for Appellant

Faith S. Hochberg
United States Attorney
Jayne K. Blumberg
Alain Leibman (argued)
Assistant United States Attorney
970 Broad Street
Newark, New Jersey 07102

               Attorney for Appellee

                        _____________________


*
   Honorable Daniel H. Huyett, 3rd, United States District Judge
for the Eastern District of Pennsylvania, sitting by designation.
                              OPINION OF THE COURT
                             _____________________


HUYETT, District Judge:
            Appellant Dennis Felton was a tax examining assistant

with the Automated Collection Service ("ACS") of the Internal

Revenue Service ("IRS").               He was responsible for, among other

things, contacting taxpayers with regard to collecting delinquent

income tax payments.             Felton offered delinquent taxpayers the

opportunity    to       settle   tax    debts    with    the   IRS    for    personal

payments to him.          He was convicted of one count of demand and

acceptance of a bribe by a public official and five counts of

unlawful gratuity demanded and sought by a public official.

            Felton appeals his sentence on three grounds.                      First,

Felton argues that the district court erred in adjusting his

offense level upward by two levels pursuant to United States

Sentencing Guideline section 3B1.1 for being a leader, organizer,

manager, or supervisor of a criminal activity.                 Second, he argues

that the district court erred in departing from the Sentencing

Guidelines to make a one-level upward adjustment.                           Third, he

argues that the district court made a mathematical error in its

computation of his offense level that caused it to find him

ineligible for a decrease in his offense level authorized by

section    3E1.1    of    the    Sentencing      Guidelines.         We   agree   with

Felton's    third       contention      and     vacate   the   district       court's

judgment of sentence and remand for resentencing.
                   I.    Factual and Procedural Background
            In early September 1992, while working for the IRS,

Felton   received   a     telephone   call   from   a   Colonia,     New   Jersey

taxpayer concerning approximately $22,000 she owed in taxes in

connection with her 1990 Form 1040.            In response to her inquiry

as to whether she could be excused from penalties and interest on

the money she owed, Felton telephoned her and told her that if

she paid him, he would "take care of business."                He arranged a

meeting at a mall in New Jersey, where he told her that in

exchange for a personal payment of $8,000, he would close the

collection action, abate all penalties and interest, and arrange

for the return of approximately $13,000 to her.                 Subsequently,

she contacted the IRS Office of the Regional Inspector concerning

this incident and participated in a controlled investigation.                  At

an October 6, 1992 meeting, the taxpayer paid Felton $2000 and

Felton told her that he wanted to receive the balance of the

bribe    payment   when    she   received    the   refund   check.     The   ACS

received a return with falsified information, and in June 1993,

the taxpayer received a refund check for $24,805.44.                 Felton was

arrested on July 14, 1993 after he demanded and received the

remaining $6,000 payment.

            On Felton's arrest, he advised the authorities that his

co-worker, Walter Clark, actually amended the return for the

taxpayer and that Clark was to share equally in the payments.

Felton needed Clark or some other person to participate in the

schemes because Felton is legally blind and cannot alter tax

returns alone.      Following Felton's arrest, agents reviewed the

files Felton and Clark handled and investigated the five other
frauds     for       which     Felton   was      convicted.          With     Felton's

cooperation, the authorities investigated Clark's involvement in

the schemes and prosecuted him for his involvement in one fraud.

             In the five incidents for which Felton was convicted of

demanding       a    gratuity,   Felton     sought    payments    to       prepare    tax

returns or resolve tax penalties or other tax problems.                        In some

instances, he offered to reduce their individual tax liabilities

and generate refunds in exchange for payments to him.                         In other

instances, he solicited taxpayers by offering to amend their

income tax returns and cause refunds to issue in exchange for

payments to him.             In several instances, he demanded and took

money from taxpayers without performing services.                      In two frauds,

involving taxpayers from Englewood, New Jersey and Mount Holly,

New Jersey, Felton contacted taxpayers after they called the IRS

to resolve their tax problems.                The Mount Holly taxpayers later

referred Felton as a tax adviser to their friends and relatives,

which led to frauds against taxpayers in Burlington Township, New

Jersey, Williamstown, New Jersey, and Budd Lake, New Jersey.                          The

Mount Holly, Burlington Township, Williamstown, and Budd Lake

taxpayers claimed that they did not know Felton was an IRS agent.

             On April 22, 1994, Felton entered a guilty plea to an

information charging him with one count of "demand and acceptance

of   bribe      by    public   official,"     in    violation     of    18    U.S.C.    §

201(b)(2), and five counts of "unlawful gratuity demanded and

sought     by       public   official,"     in     violation    of     18    U.S.C.     §

201(c)(1)(B).          A sentencing hearing was held on July 11, 1994.

In   the   judgment,         subsequently     filed   on   July      20,     1994,    the
district     court       adopted        the   factual        findings       and       Guideline

applications           in       the       Presentence         Investigation               Report

("presentence         report"      or     "PSR")   except      for       three    paragraphs.

App. 115 (Judgment, July 20, 1994).                      Thus, the record reviewed

includes the presentence report, the court's oral explanation of

its decision at the hearing, and the judgment order.

            At        the     sentencing       hearing,            the     district        court

calculated       a    base    offense      level   of   ten,        pursuant         to section

2C1.1,    "Offering,         Giving,       Soliciting,        or    Receiving         a   Bribe;

Extortion Under Color of Official Right."                          As recommended in the

presentence report, pursuant to subsection 3B1.1(c), the court

raised the offense level by two levels because Felton played an

aggravating role in the offense.                   The court also considered the

specific offense characteristics provisions of section 2C1.1(b).

First, the court adopted the probation office's calculation of a

$31,295.44 loss attributable to Felton and increased the offense

level by four levels because the aggregate harm exceeded $20,000,

pursuant to subsection 2C.1.1(b)(2).                    Second, the district court

rejected the probation officer's calculations and agreed with

Felton     that       although      the    Guidelines        authorized          a    two-level

increase     for       multiple         gratuities      or    multiple           bribes,    the

Guidelines did not authorize an increase when there was just one

bribe,     but       multiple      gratuities.          The    court,       however,        used

Felton's argument to depart from the Guidelines to increase the

offense    level       by    one   level.      Next,     although          the    presentence

report    recommended         a    three-level       decrease        for    acceptance        of

responsibility pursuant to section 3E1.1, the court granted only
a two-level decrease.        The court believed that by not imposing

the two-level increase for multiple bribes, the offense level

prior to the operation of subsection 3E1.1(a) was 15, and not 16

or   greater,   which     would    have    permitted       another      decrease    in

offense    level    for    timely      providing         information     concerning

involvement in offense or timely notifying authorities of his

intention to enter a plea of guilty.              Finally, the district court

granted     a   one-level         downward        departure,       following       the

government's section 5K1.1 motion.

            In summary, the district court's modification of the

presentence report yielded an offense level of 14.                     The following

calculation reflects the order in which the offense level should

be    calculated,   pursuant      to   the    application         instructions      of

section 1B1.1:
   Base offense level, § 2C1.1(a)                                       10
   Specific offense characteristics, § 2C1.1(b)
          More than one gratuity or bribe                                0
          Aggregate harm more than $20,000                             + 4
   Aggravating role in the offense, § 3B1.1(c)                         + 2
   Acceptance of responsibility, § 3E1.1(a)                            - 2
   Additional adjustment for acceptance of
          responsibility, § 3E1.1(b)                                     0
   Upward Departure from § 2C1.1                                   + 1
   Downward departure, § 5K1.1                                       - 1

     Total Offense Level =                                              14

For an offense level of 14, the Guidelines prescribe a sentence

within the range of 15 to 21 months.                    USSG Ch. 5, Pt. A.         The

district   court    sentenced     Felton     to    15    months   on    the   bribery

charge and 15 months on each of the gratuities charges, each to

be served concurrently.
                               II.     Discussion
             We have appellate jurisdiction over this appeal from

the final decision of the district court pursuant to 28 U.S.C. §

1291.   The district court had subject matter jurisdiction in this

criminal matter.       See 18 U.S.C. § 3231.           We review the district

court's factual findings in relation to sentencing issues for

clear error.       United States v. Fields, 39 F.3d 439, 447 (3d Cir.

1994); United States v. Miele, 989 F.2d 659, 663 (3d Cir. 1993);

United States v. Belletiere, 971 F.2d 961, 964 (3d Cir. 1992).                    A

finding is clearly erroneous, if, after reviewing all of the

evidence, we are left with the firm conviction that a mistake has

been made.    Belletiere, 971 F.2d at 969.             Our review with respect

to the district court's application and interpretation of the

Sentencing Guidelines is plenary.             Id. at 964; United States v.

Bogusz, 43 F.3d 82, 85 (3d Cir. 1994); United States v. Murillo,

933 F.2d 195, 197 (3d Cir. 1991).              When the application of the

Guidelines    presents      a    mixed   question     of    law   and   fact,   "our

standard     and    scope       of   review   takes    on     greater    scrutiny,

approaching de novo as the issue moves from one of strictly fact

to one of strictly law."             Belletiere, 971 F.2d at 964 (quoting

Murillo, 933 F.2d at 198).
A.   Adjustment for Aggravating Role

             We first address Felton's argument that the district

court's two-level increase for Felton's aggravating role in the

offense was in err.         The pertinent portion of section 3B1.1 of

the Guidelines provides:
          Based on the defendant's role in the offense,
          increase the offense level as follows: . . .
          (c) If the defendant was an organizer,
            leader,   manager,  or   supervisor  in   any
            criminal activity other than described in (a)
            or (b), increase by 2 levels.


USSG § 3B1.1.1      Section 3B1.1 requires the district court to find

that "the defendant exercised control over at least one other

person."     United States v. Katora, 981 F.2d 1398, 1402 (3d Cir.
1992).     See also USSG § 3B1.1, comment. (n.2) ("the defendant

must have been the organizer, leader, manager, or supervisor of

one or more other participants").

            Felton     takes     issue     with    the     district      court's

determination that he was a leader in criminal activity.                    This

determination is essentially factual, therefore, we reverse the

district court only if its conclusion was clearly erroneous.

Fields, 39 F.3d at 447; United States v. Phillips, 959 F.2d 1187,

1191 (3d Cir.), cert. denied, ___ U.S. ___, 113 S. Ct. 497, 121

L. Ed. 2d 434 (1992); United States v. Ortiz, 878 F.2d 125, 127

(3d Cir. 1989).

            The   presentence     report   mentions      Clark   in    connection

with three of the six incidents for which Felton was convicted,

although Clark was only charged with and convicted of one fraud.

Neither    Felton    nor   the   government     objected    to   the    facts    as

presented by the probation office with regard to these three

incidents.     With regard to the bribery concerning the Colonia

taxpayer,    Felton   offered    to   arrange     the   return   of taxes       she


1
 . Subsections (a) and (b) concern situations where the
defendant was a leader, organizer, manager, or supervisor of
criminal activity that involved five or more participants or was
otherwise extensive.
already paid to the IRS for a personal payment to him, Felton

requested that the check be payable to him, and Felton requested

documentation relating to her mortgage, sale of her home, and her

profit sharing plan.       Felton also scheduled meetings with her and

agreed to adjust her current and past tax returns, Felton told

the taxpayer how to make payments, and Felton personally accepted

$6,000 in cash from the taxpayer.           Clark, along with Felton and

other Tax Examining Assistants, extended her account suspension.

Clark also amended the taxpayer's income tax return, received

$1,000 for this service, and Felton promised him another $3,000

after payment of the balance owed by her.

            With respect to the Englewood taxpayer, Felton's first

contact with the taxpayer was through the IRS toll free telephone

number.     Felton later contacted her to assist her with her tax

problems,    Felton   requested     money   in   exchange    for   purported

services, and Felton received payments from this taxpayer.                Clark

only attended meetings at her residence with Felton.

            With respect to the Mount Holly taxpayers, after the

taxpayers     had   made    numerous   telephone     contacts      with    IRS

representatives, Felton contacted them.            He told them that he

could     prepare   and    submit   their   income   tax     returns      using

information they provided, Felton denied that any illegality was

involved, and Felton was paid by the taxpayers.             According to the

presentence report, Clark met one of the taxpayers with Felton,

amended the tax return, and got some portion of the payment

received by Felton.
            The probation officer summarized their involvement and

offenses as follows:
          26.   Felton made all initial and subsequent
          contacts with the victim's [sic] of this
          offense. He made preliminary judgments as to
          feasibility of amending their returns, and
          made the arrangements to gather necessary
          information from the victims to be used in
          amending the returns.       He solicited the
          assistance    of    Walter  Clark,  who   was
          responsible for amending some or all of the
          returns, in exchange for payment by Felton,
          and presumably provided Clark with the
          information      necessary   for   amendment.
          Pursuant   to     3B1.1(c), Felton  was   the
          organizer of the offense.

            27.    Clark's role was in assistance to
            Felton, such as transporting Felton to
            meetings with the victims, and taking notes
            during the meetings.       While Clark was
            responsible for actually amending the returns
            themselves, his assistance was solicited by
            Felton, by whom Clark was paid. Pursuant to
            3B1.2(b), Clark was a minor participant in
            the offense.


PSR   ¶¶   26-27.   Neither   party   specifically   objected   to   these

paragraphs,    although   they   both    objected    to   the   probation

officer's characterization of Felton as an organizer in other
parts of the presentence report.        The court, however, considered

Felton the leader, stating:
          There is no question that he should get the
          two point enhancement under 3B1.1(c).     Mr.
          Felton's sentence should reflect his conduct
          without reference to whatever sentence Clark
          got and why.   Under 3B1.1(c), Mr. Felton in
          my judgment was clearly the organizer,
          leader, manager of this criminal activity.
          He recruited Clark and, I suggest, others.


App. at 85 (Transcript).
            "When a person manages or supervises another in the

course of a criminal enterprise, the manager or supervisor will

normally be more culpable than the person managed or supervised."

United States v. Fuentes, 954 F.2d 151, 153 (3d Cir. 1992).                         "The

direction and control of others is a recurrent theme in legal

definitions of the terms 'manager' and 'supervisor.'"                             United

States v. King, 21 F.3d 1302, 1305 (3d Cir. 1994).                          The record

supporting the district court's conclusion that Felton was the

organizer,       leader,    manager,     or     supervisor    is     not    extensive,

especially       considering      that    at    the     sentencing,    neither      the

prosecution nor the defense thought the increase was appropriate.

However, several uncontested facts in the presentence report do

tend   to   support       the   district      court's    conclusion        that   Felton

played a supervisory role over Clark.                    First, Felton made all

initial contacts with the victims of the fraud.                       Second, Clark

performed much of the menial work of the scheme:                   he drove Felton

to   meetings      with    the    victims,      he    took   notes    during       those

meetings, and he was given the responsibility of amending the

victims' tax returns.            While Felton's blindness -- and inability

to perform these tasks -- no doubt diminishes the import of those

tasks to determining Clark's role, we think that they do evidence

the fact that Felton had at least some authority over Clark to

have Clark do his bidding.               Finally, the fact that Felton was

involved    in    more     incidents     than    Clark    supports     the    district

court's conclusion that it was Felton's scheme to begin with and

that Felton "recruited Clark" to work for him.                         The evidence

concerning their individual roles in the offense was sufficient
record evidence for the district court to conclude that Felton

was an organizer, leader, manager, or supervisor, even though

Clark did not participate in every scheme.               The district court's

finding was not clearly erroneous.

B.     Departure from the Guidelines

            We next consider Felton's argument that the district

court erred in departing from the Sentencing Guidelines to adjust

his offense level upward by one level.              Generally, the district

court must sentence a defendant within the applicable guideline

range.      However, when "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" the court may depart from

the guideline range.            18 U.S.C. § 3553(b).            See also United

States v. Bertoli, 40 F.3d 1384, 1408 (3d Cir. 1994); United

States v. Kikumura, 918 F.2d 1084, 1098 (3d Cir. 1990).

            We review the district court's decision according to

the model set forth in United States v. Kikumura, 918 F.2d 1084.

First, we determine whether the circumstances upon which the

district court relied to justify the departure were adequately

considered by the Sentencing Commission.                This requires a two-

fold    inquiry:     we   exercise      plenary   review   over    the   district

court's determination that the Guidelines do not adequately take

a particular factor into consideration, Kikumura, 918 F.2d at
1098, and we apply a clearly erroneous standard of review to

determine    whether      the   facts    support   the     sentencing    court's
rationale.      United States v. Seale, 20 F.3d 1279, 1287 (3d Cir.

1994); Kikumura, 918 F.2d at 1098.              Second, we must determine

whether the sentence imposed was reasonable.           This also demands a

two-fold inquiry:        we consider whether the factors on which the

court relied were appropriate and whether the degree of departure

was appropriate.         United States v. Ryan, 866 F.2d 604, 610 (3d

Cir. 1989).      In this determination, we permit the district courts

to exercise a substantial amount of discretion.            Bertoli, 40 F.3d

at 1408; Kikumura, 918 F.2d at 1098.             We address each issue in

turn.

           1.     Adequate Consideration by the Sentencing Commission

           We     must     first    determine    whether   the      Sentencing

Commission      took     adequate   consideration     of   the    aggravating

circumstance upon which the district court relied.               In this case,

the factual basis for departure was not disputed.                The district

court found that Felton accepted one bribe and five gratuities.

The   district    court    reasoned    that   the   magnitude     of   Felton's

schemes was an aggravating factor that the Sentencing Commission

did not adequately consider.

           The district court is permitted to examine only the

Sentencing Guidelines, the policy statements, and the official

commentary of the Guidelines to determine whether the Sentencing

Commission adequately considered this aggravating factor.                   18

U.S.C. § 3553(b); Kikumura, 918 F.2d at 1104.2

2
 . To minimize confusion in the arguments Felton advances, we
briefly explain the Guideline sections applied. The Sentencing
Guidelines require the district court to group together all
counts involving substantially the same harm. USSG § 3D1.2. The
             Section 2C1.1 requires a two-level increase in offense

level,    "[i]f     the   offense     involved    more   than   one   bribe    or

extortion."       USSG § 2C1.1(b)(1).        Section 2C1.2, which would have

applied had their been no bribes, requires a two-level increase

"[i]f the offense involved more than one gratuity."                     USSG §

2C1.2(b)(1).        The Guidelines, the policy statements, and the

official commentary of the Sentencing Commission do not mention

that an increase is available to raise the offense level for one

bribe and multiple gratuities.          See § 2C1.1(b)(1).

             The court's analysis of this issue was not extensive.

While    making    objections    to    the    presentence   report,    Felton's

counsel argued that the Guidelines do not permit the court to

aggregate one bribe with multiple gratuities to increase the

offense level by two levels because then the gratuities would be

treated as bribes.         The court appeared to accept this argument

and   used   this     argument   to    justify    its    departure    from    the

Guidelines. An exchange concerning this issue was as follows:
          MR. KELLER:    I'm saying that it's totally
          improper to start aggregating one bribe with
          certain   gratuities  and   lump  all   these
          gratuities, all of a sudden to become bribes.
          . . .

             THE COURT:   Well, suppose I don't give him
             those two points. Look, at the rate you're
             going I'm going to have to give him a
             present.
(..continued)
counts of bribery and gratuities must be grouped together. §
3D1.2(d). Because these counts involve offenses of the same
general type, the court must apply the offense guideline that
produces the highest offense level. § 3D1.3(b). Because the
bribery provision, § 2C1.1, produces a higher offense level than
the gratuity provision, § 2C1.2, the bribery guideline is used.
               You know, I'm not going to buy this
          argument, though I'll tell you I am not going
          to not count five counts on which he accepted
          an illegal gratuity. So even if you're right
          on the law here, it would certainly be an
          appropriate ground for an upward departure.
          Right? You couldn't disagree with that.

          MR. KELLER:   Well --

          THE COURT:    Because this is conduct which
          would not otherwise be counted. So I mean I
          don't know, which way do you want me to go on
          that?


App. at 78-79 (Transcript).   After a recess, the court explained

its departure from the Guidelines as follows:
          I am going to grant Mr. Keller's objection to
          the -- what is it, 2C1.1 bribery or extortion
          language. This is very complicated. I think
          I could make an argument that because one is
          referred under the gratuity statute to 2C1.1,
          and that language of bribery or extortion,
          that perhaps Mr. Keller's argument should be
          rejected. But I'm not clear enough on it to
          say. It is just too murky. So I'm going to
          take off those two points.
               That does not quite end the issue
          though.    Because by taking off those two
          points, Mr. Felton is no longer eligible for
          the   additional  point   on  acceptance   of
          responsibility. Because he's down into a --
          what's it, a 15 instead of a 16. So all of
          that having been said, that's not to say Mr.
          Keller, because I told you I would, I'm going
          to give you the two points on that particular
          objection.   But I will upward depart and I
          will upward depart one level to compensate
          for the one level that is being lost on the
          acceptance of responsibility, third point.


App. at 85-86 (emphasis added) (Transcript).

          In the judgment order, the court explained its basis

for the upward departure as follows:
            Because one bribery and five gratuities were
            not aggregated to receive the 2 level
            increase under 2C1.1, the gratuities would
            not be punished absent an upward departure, a
            circumstance   not   adequately  taken   into
            consideration by the Commission.


App. at 114 (Judgment).

            We reject Felton's argument that the multiple count

provisions, found in Chapter Three, Part D of the Sentencing

Guidelines, make clear that the Sentencing Commission considered

the   impact     of   multiple   count   convictions     on    the     sentencing

process    and   believed    that    certain   offenses       were    so   closely

intertwined that they should not receive any increase under the

Guidelines.       As explained by the Sentencing Commission in its

introductory commentary to the multiple count provisions:
          Some offense guidelines, such as those for
          theft, fraud and drug offenses, contain
          provisions that deal with repetitive or
          ongoing behavior. Other guidelines, such as
          those for assault and robbery, are oriented
          more toward single episodes of criminal
          behavior.   Accordingly, different rules are
          required for dealing with multiple-count
          convictions involving these two different
          general classes of offenses.


USSG Ch. 3, Pt. D, intro. comment.             The Sentencing Commission

explicitly authorized a two-level increase in offense level for

multiple   bribes     in   section   2C1.1   and   a   similar       increase for

multiple unlawful gratuities in section 2C1.2.             Thus, despite the

multiple count provisions, the Sentencing Commission approved an

increase in offense level for multiple bribes or gratuities, as

compared to single instances of a bribe or a gratuity.
              The    Sentencing      Commission          authorized        an       increase    in

offense level for six bribes or six gratuities, but not for a

combination of one bribe and five gratuities.                               The Sentencing

Guidelines,        the    commentary,       and    the    background           notes    do     not

indicate that the Sentencing Commission believed that this type

of repeated unlawful conduct involving a bribe and gratuities

should be treated less harshly than repeated unlawful conduct

involving only bribes or only gratuities.                        Thus, it appears that

the Sentencing Commission did not consider this result.

              2.    Reasonableness of the Adjustment

              We    also    must    consider      whether        the     district       court's

upward adjustment was reasonable.                      Kikumura, 918 F.2d at 1110.

Review is deferential.              Id. at 1098.           To determine whether the

sentence was reasonable, we consider the factors set forth in 18

U.S.C.    §   3553(a)       and    the   reasons        for   the      imposition       of     the

particular sentence as stated by the district court, pursuant to

section    3553(c).          18    U.S.C.    §    3742    (Review         of    a    sentence);

Kikumura, 918 F.2d at 1098.                  We consider "whether the factors

relied on are appropriate; and whether the degree of departure

was   appropriate."               Kikumura,       918     F.2d      at     1098       (internal

quotations omitted).              "In order to be 'appropriate,' a factor

occasioning        or     contributing      to    an     upward     departure          must     be

relevant      to    the    defendant's      culpability."                United      States     v.

Schweitzer, 5 F.3d 44, 48 (3d Cir. 1993).

              The       factors     upon     which        the     court         relied       were

appropriate.         The fact that Felton accepted multiple gratuities

is relevant to his culpability because the Sentencing Guidelines
already    meted    increased       punishment        for    public    officials    who

accepted multiple bribes or multiple gratuities.                          To sentence

pursuant     to    the    Guidelines       would      have    been     equivalent   to

sentencing Felton for one bribe greater than $20,000 without

reflecting    the    multitude      of    gratuities        demanded    or   accepted.

Furthermore,       the    degree    of    departure     was    appropriate.         The

increase in the offense level was no greater than the increase

that would have been required for acceptance of two gratuities,

had there been no bribery charges.               Thus, we find no error in the

court's upward departure.

 C.   Reduction for Acceptance of Responsibility

            Finally,       we     consider       Felton's      argument      that   the

district court erred in its computation of his offense level,

which caused the district court to find him ineligible for a

third   decrease     in    his    offense    level     which    was    authorized    by

section 3E1.1 of the Sentencing Guidelines.                     The district court

decreased    Felton's      offense       level   by    two    levels,    pursuant   to

subsection 3E1.1(a).            Felton argues that he should have received

an additional one-level decrease pursuant to subsection 3E1.1(b).

Section 3E1.1 provides as follows:
          (a) If the defendant clearly demonstrates
          acceptance of responsibility for his offense,
          decrease the offense level by 2 levels.

            (b) If the defendant qualifies for a decrease
            under subsection (a), the offense level
            determined   prior   to  the   operation   of
            subsection (a) is level 16 or greater, and
            the defendant has assisted authorities in the
            investigation or prosecution of his own
            misconduct by taking one or more of the
            following steps:
               (1)     timely    providing     complete
               information to the government concerning
               his own involvement in the offense; or
               (2) timely notifying authorities of his
               intention to enter a plea of guilty,
               thereby permitting the government to
               avoid preparing for trial and permitting
               the court to allocate its resources
               efficiently,
          decrease the offense level by 1 additional level.


USSG § 3E1.1.    The district court is particularly well suited to

evaluate a defendant's acceptance of responsibility.    Therefore,

its determination can only be reversed if we find it was clearly

erroneous.   United States v. Pardo, 25 F.3d 1187, 1193 (3d Cir.

1994).

          Felton argues that the district court failed to grant

him a reduction of one level pursuant to subsection 3E1.1(b)

because it thought that he had an offense level of only 15

instead of 16.   The transcript of the sentencing hearing and the

ensuing judgment support this argument.    Prior to the operation

of subsection 1B1.1(a), Felton's offense level was sixteen, based

on a base offense level of ten, a four-level increase for loss

greater than $20,000, and a two-level increase for Felton's role

as organizer.     The court, however, said with respect to this

issue:
          [B]y taking off those two points, Mr. Felton
          is no longer eligible for the additional
          point   on   acceptance  of   responsibility.
          Because he's down into a -- what's it, a 15
          instead of a 16. So all of that having been
          said, that's not to say Mr. Keller, because I
          told you I would, I'm going to give you the
          two points on that particular objection.
App. at 107 (Transcript).            The court repeated this reasoning in

the judgment as follows:
          2C1.1 states that if the offense involved
          more than one "bribe or extortion" increase
          by 2 levels.    The offense here involved one
          bribe and five gratuities.     Because it is
          unclear whether this aggregate behavior can
          receive the 2 level increase, the two level
          increase was deleted.      As a result, the
          additional   adjustment   for  acceptance  of
          responsibility in paragraph 46 was deleted as
          well.


App.   at    115   (Judgment).        The   court's    explanation   was   clear

error.3      The government argues that Felton was not granted the

additional one-level reduction because the district court could

have made independent findings of fact that Felton failed to

assist authorities.          The district court, however, never made any

such findings.       The only evidence of Felton's failure to assist

that   the    government      can    find   is   an   offhand   remark    by   the

government's       counsel    that    Felton     embellished    certain    facts

surrounding the offense in the course of aiding the authorities.
3
 . The government maintains that Felton never objected to the
district court's refusal to give a three-level reduction and
accordingly waived his right to appeal unless the mistake was
plain error. United States v. Pollen, 978 F.2d 78, 88 (3d Cir.
1992) (sentencing disputes reviewed for plain error where
defendant fails to object in the district court but finding that
the miscalculation in that case was plain error), cert. denied,
___ U.S. ___, 113 S. Ct. 2332, 124 L. Ed.2d 244 (1993). Under a
plain error standard, the court is concerned only with errors
that seriously affect substantial rights or compromise the
fairness of the proceedings. Id. This circuit and others have
found that the miscalculation of a defendant's offense level
"certainly is error that seriously affect[s] [the defendant's]
rights, and so amounts to plain error." Id. at 90; United States
v. Moss, 9 F.3d 543, 553 (6th Cir. 1993) (application of clearly
incorrect base level offense deemed clear error); United States
v. Plaza-Garza, 914 F.2d 345, 348 (1st Cir. 1990).
The district court never referred to this comment, nor did it

explicitly      find    that       Felton    failed      to    assist.     The   district

court's reason for denying the third offense level decrease for

acceptance of responsibility was clear error.                       We remand the case

for resentencing on this issue.
                                     III.    Conclusion

            In summary, we hold that the district court's reason

for     denying        an     additional         decrease        for     acceptance     of

responsibility was clear error.                  The court did not err, however,

in    finding   that        Felton    was    a   leader,      organizer,    manager,    or

supervisor, nor did the court err in departing upward one level

in sentencing Felton.              Accordingly, we will vacate the district

court's    judgment          and     order       of   sentence      and    remand     with

instructions      for       the    district      court    to    resentence    Felton   in

accord with this opinion.
