
USCA1 Opinion

	




                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 96-1203                              UNITED STATES OF AMERICA,                                      Appellee,                                          v.                               CHARLES HENRY GILL, JR.,                                Defendant, Appellant.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                              FOR THE DISTRICT OF MAINE                       [Hon. Gene Carter, U.S. District Judge]                                          ___________________                                 ____________________                                        Before                                Torruella, Chief Judge,                                           ___________                                Boudin, Circuit Judge,                                        _____________                              and Lisi,* District Judge.                                         ______________                                 ____________________            Terry A. Fralich  with whom Peter J.  DeTroy and Norman, Hanson  &            ________________            ________________     _________________        DeTroy were on briefs for appellant.        ______            Helene  Kazanjian, Assistant  United  States  Attorney, with  whom            _________________        Jay P.  McCloskey, United States Attorney, was on brief for the United        _________________        States.                                 ____________________                                   November 6, 1996                                 ____________________                                    ____________________        *Of the District of Rhode Island, sitting by designation.                 BOUDIN, Circuit  Judge.   Charles Gill appeals  from his                         ______________            sentence,  following a  plea  of guilty  to various  criminal            charges, to  challenge two sentencing  determinations made by            the district judge.  One involves the issue of the vulnerable            victim  adjustment,   U.S.S.G.     3A1.1(b);  the  other,  an            increase for abuse of a position of trust.  Id.   3B1.3.  The                                                        ___            facts,  which  we  briefly  summarize,  are  drawn  from  the            presentence report,  the  sentencing transcript  and  various            other materials  before the district court.  United States v.                                                         _____________            Egemonye, 62 F.3d 425, 426 (1st Cir. 1995).              ________                 From  August 1993  until November  1994, Gill  owned and            operated  the  Maine  Health  Trust, doing  business  as  The            Counseling   Center   in   Fryberg,   Maine,   and   provided            psychological  counseling  services  to  individuals  at  the            Counseling  Center  during this  period.   Additionally, from            February 1994  to November 1994, Gill  was employed part-time            at the Bethel Area  Health Center in Bethel, Maine,  where he            performed similar counseling services.                   Gill told individual patients at the two facilities, and            his employers  at  the Bethel  Area  Health Center,  that  he            possessed a doctoral degree in psychology and was licensed as            a psychologist or counselor  under Maine law.  In  fact, Gill            was not licensed and had never received an advanced degree in            either  psychology or  counseling.   Gill  had a  substantial            record of offenses involving theft and passing bad checks.                                         -2-                                         -2-                 During the period in question, Gill submitted claims, or            caused patients and  the Bethel Area Health Center  to submit            claims for payment to various private insurance companies and            the  Medicare and  Medicaid programs  for services  that Gill            provided  to them.  The  total value of  the payments claimed            from these entities was over $37,000.  Gill also made similar            false  statements as to his  credentials and licensing to the            insurance companies and to Medicare and Medicaid authorities.            Gill  received payments totalling  over $16,000 directly from            individual patients.                   In  March  1995,  Gill  pled  guilty  to  one  count  of            willfully  using  a passport  secured  by  means of  a  false            statement,  18  U.S.C.     1542, Gill  having  proffered  the            passport when  the Bethel Area Health  Center requested proof            of  his citizenship  at  the start  of  his employment.    In            October  1995, Gill pled guilty  to one count  of mail fraud,            one  count of  wire  fraud, and  one  count of  making  false            statements to  the Medicare and Medicaid programs.  18 U.S.C.                 1341,  1343;  42  U.S.C.     1320.    All  charges  were            consolidated for sentencing.                   Following a  hearing on  January 30, 1996,  the district            court sentenced Gill to  40 months' imprisonment, three years            supervised release,  and a requirement of  restitution in the            amount of $43,481.49.  The underlying calculations included a            two-level increase  in Gill's  base offense level  for victim                                         -3-                                         -3-            vulnerability, U.S.S.G.   3A1.1(b), and  a two-level increase            for abuse of a  position of trust, id.   3B1.3.   It is these                                               ___            two adjustments that  are the sole subjects  of Gill's appeal            from  his sentence.   Gill was  sentenced under  the November            1995 edition  of the guidelines,  and references are  to that            version unless otherwise specified.                 The standard of review in such a case is simple, in fact            deceptively so,  in the  standard formulation:   the district            court's  factual   findings  are  respected   unless  clearly            erroneous,  and the  determinations  of law  are reviewed  de                                                                       __            novo.  United States v. Sabatino,  943 F.2d 94, 102 (1st Cir.            ____   _____________    ________            1991).   In principle, the application of a legal standard to            undisputed  facts  is  also an  issue  of  law,  id., but  in                                                             ___            practice the matter is not quite so clear-cut.                 Victim  vulnerability.    Since  November 1,  1989,  the                 _____________________            provision now  designated  U.S.S.G.    3A1.1(b) has  remained            substantially  unchanged, although  a  recent change  in  the            commentary   is  pertinent   to  the  issue   of  "targeting"            (discussed  below).   The  black letter  of section  3A1.1(b)            states that  a two-level increase in  the defendant's offense            level must be imposed:                 [i]f the defendant knew or should have known that a                 victim of  the offense was unusually vulnerable due                 to  age, physical  or mental  condition, or  that a                 victim  was  otherwise particularly  susceptible to                 the criminal conduct.                                          -4-                                         -4-                 The presentence report  proposed that the adjustment  be            applied  to  Gill.     As  amended  to  reflect   rulings  on            objections,  the  report reasoned  that  Gill  knew that  the            patients  with whom  he would  be dealing  "had psychological            difficulties, mental  health  disorders and  substance  abuse            problems."  Accordingly, the probation officer said that Gill            knew  that  his  victims were  vulnerable  and  "specifically            targeted them because of their  `vulnerability' by [choosing]            to  play the part  of a  person who  treats such  people with            mental health problems."                 At sentencing,  the district  court  concluded that  the            victims "were  especially vulnerable  because of their  needs            that  gave rise  to  their  seeking  and their  receiving  of            services."    The court  cited  decisions  in other  circuits            imposing  such  an  adjustment  on  individuals  fraudulently            providing medical services.  See United States v. Echevarria,                                         ___ _____________    __________            33  F.3d  175, 180-81  (2d  Cir.  1994) (unlicensed  doctor);            United States  v. Bachynsky, 949  F.2d 722, 735-36  (5th Cir.            _____________     _________            1991) (physician making false  diagnoses), cert. denied,  506                                                       ____________            U.S. 850 (1992).                 Gill disputes the district court's adjustment on several            grounds.  He argues that the finding of vulnerability must be            based on  evidence as to  individuals, rather than  upon mere            membership  in a  class.   He  denies  that the  patients  he            victimized were especially vulnerable.  Finally, he says that                                         -5-                                         -5-            he  did  not  "target"  the  victims   on  account  of  their            vulnerability, a  requirement  he imputes  to  the  guideline            based  on commentary  language.   The  first  two claims  are            related; the  last we discuss separately in  the next section            of this opinion.                 The vulnerable  victim guideline is  primarily concerned            with the impaired capacity of the victim to detect or prevent            the  crime, rather than with the quantity of harm suffered by            the victim.   The latter  aggravation is dealt  with in  five            other  provisions of  the  guidelines,  expressly  permitting            _____            upward  departures  where   the  crime  resulted   in  death,            significant  physical  injury, extreme  psychological injury,            special  property damage,  or  the  gratuitous infliction  of            injury or  prolonging of  pain or  humiliation.   U.S.S.G.               5K2.1, .2, .3, .5, .8.  As United States v. Kaye, 23 F.3d 50,                                       _____________    ____            54 (2d Cir. 1994), explained:                      [T]he courts appear  to have  interpreted                      the phrase "susceptible  to the  criminal                      conduct" as emphasizing that a particular                      victim  was  less  likely  to  thwart the                      crime,  rather than more likely to suffer                      harm if the crime is successful.                 Thus,  the issue here is whether the patients at the two            mental  health  facilities  where  Gill  practiced  were,  on            account of their condition,  substantially less able than the            average citizen  to protect themselves against  Gill's fraud.            There is nothing in the presentence report or in the district            judge's  comments  that suggests  a misunderstanding  on this                                         -6-                                         -6-            point.  However, we stress the focus of the  guideline at the            outset because one cannot measure degrees of vulnerability or            susceptibility   without  some   notion   of  what   kind  of                                                                 ____            vulnerability or susceptibility is at issue.                 Even  thus narrowed,  our case  is  peculiarly difficult            because Gill was dealing with a group, made up of individuals                                            _____            about whom we know  almost nothing beyond the fact  that they            fall  into a class of persons, namely, those who visit mental            health  centers for  counseling and  therefore are  likely to            have or think  they have some  emotional or mental  problem--            which may afflict the patient or a related non-patient.  Gill                                          __            argues that in such a case it is improper for a vulnerability            finding to be based on  membership in a class rather  than on            evidence as to a specific individual.                 Appeals  courts have  been  rather more  willing to  set            aside determinations of vulnerability  made solely on a class            basis  than when  the focus  was on  the susceptibility  of a            specific individual.  United States v. Rowe, 999 F.2d 14, 16-                                  _____________    ____            17 (1st Cir. 1993).  But, as we also said in Rowe, this is in                                                         ____            no way a fixed rule.  Id. at 17.  In some cases the inference                                  ___            to be drawn from the class characteristics may be so powerful            that there can be little doubt about unusual vulnerability of            class members within the meaning of section 3A1.1.                 The  guideline makes  clear that  "class" determinations            are  permissible  by  saying   in  its  commentary  that  the                                         -7-                                         -7-            adjustment  would apply  to someone  who sold  an ineffective            cancer  cure.  U.S.S.G.    3A1.1(b), comment.  n.2.  Numerous            cases  have   upheld  upward  adjustments   based  on   group            determinations.  See, e.g., United States v. Malone, 78  F.3d                             _________  _____________    ______            518, 522-23  (11th Cir.  1996) (cab drivers);  Echevarria, 33                                                           __________            F.3d  at   180-181  (medical  patients);  United   States  v.                                                      _______________            McDermott,  29   F.3d  404,   411  (8th  Cir.   1994)  (black            _________            teenagers);  United States v. Peters, 962  F.2d 1410, 1417-18                         _____________    ______            (9th   Cir.  1992)  (people   with  poor  credit  histories);            Bachynsky, 949 F.2d at 735 (medical patients).            _________                 In Rowe, the primary subjects of the fraud were business                    ____            entities, and, without knowing more about any company, it was            hard  for us to see  how they were  "unusually" vulnerable to            fraud.  The more recent case  of United States v. Feldman, 83                                             _____________    _______            F.3d 9 (1st  Cir. 1996), also  relied upon by Gill,  is quite            different.   There,  this court  was concerned  with  a crime            directed  against only one or  two specific victims.   Id. at                                                                   ___            15-16.   To resort to a single, class-based characteristic in            such a case is to prefer the less complete picture  to a more            complete one readily available.                 Yet  even  in  a   one-victim  case,  a  single  "class"            characteristic  could be so powerful a proof of vulnerability            as to settle the  issue without more.  Indeed,  the guideline            commentary  suggests it would be enough to show that an armed            robbery  victim was  confined to  a wheelchair.    U.S.S.G.                                           -8-                                         -8-            3A1.1(b), comment. n.2.   In truth, many inferences  about an            individual rest on an  implicit generalization about a class.            Everything depends on the strength of the inference.                 In our  own case,  the government could  have simplified            matters if it had offered evidence from some of Gill's former            patients  as  to their  own conditions.    At the  same time,            concerns about  privacy and privilege make  it pretty obvious            why  the prosecutor  might wish  to avoid  this course--quite            apart  from  considerations  of time  and  expense.    In all            events, the government  was free to  rest upon the  inference            that many  such patients would be  highly vulnerable, leaving            it to the sentencing judge to agree or disagree.                 In  our  view,  a   sentencing  judge  could  reasonably            conclude  based on  general  knowledge that,  in the  typical            situation,  at least a fair number of patients at a community            mental health center are commonly under significant emotional            stress.  True, some  patients might be free of stress  but to            suppose this to be generally true is unrealistic.  Counseling            in mental  health matters  often involves disclosing  affairs            that  most people  treat  as private  and,  if for  no  other            reason, it  is a step  that many are  likely to take  only to            cope with substantial strains.                  The records revealed that Gill had treated many            patients and that a number  of them had multiple visits.   It            is thus  safe to infer  that at  least some of  these victims                                         -9-                                         -9-            were under significant stress  and so unusually vulnerable to            Gill's fraud.  It seems to us evident that Gill could foresee            the risk sufficiently to meet the guideline's "knew or should            have known" standard.  Id.   3A1.1(b).  See United  States v.                                   __               ___ ______________            Skillman, 922 F.2d 1370, 1378  (9th Cir. 1990), cert. denied,            ________                                        _____ ______            502 U.S. 922 (1991).1                 Ours would be a different case if Gill had seen only one            patient and we  knew nothing  about that individual.   Yet  a            different problem would be presented if Gill had accepted the            general  inference as  to most  clinics but  offered evidence            that his clinic  treated only persons with a  special problem                 ___            unlikely  to involve  much patient  stress.   But neither  of            these variations is presented, and there will be time  enough            to deal with them, and many other variations, as cases arise.                 Targeting.   Gill  makes a  separate complaint  that his                 _________            section 3A1.1 enhancement was erroneously applied  because he            did not  "target"  or select  his  victims because  of  their            unusual  vulnerability.    He  cites several  cases  for  the            proposition that  this motivation  is a additional  requisite            element.   Until  November  1995, the  commentary to  section            3A1.1  stated  that  the  section was  applicable  "where  an                                            ____________________                 1This contrasts  with the  situation,  described by  the            guideline commentary, in which one of many victims happens to            be vulnerable by some  circumstance accidental in relation to            the  fraud  and largely  unforeseen.    U.S.S.G.    3A1.1(b),            comment.  n.2  (enhancement  not applicable  to  purveyor  of            fraudulent securities to general public if one victim happens            to be senile).                                         -10-                                         -10-            unusually  vulnerable victim  is  made a  target of  criminal            activity by the  defendant."  U.S.S.G.   3A1.1,  comment. n.1            (Nov. 1994).                 This commentary language was  deleted  by the Sentencing            Commission in  November 1995 to "clarif[y]  the operation" of            section  3A1.1.   U.S.S.G.  App.C, Amend.  521, at  430 (Nov.            1995).  But Gill's  criminal conduct took place prior  to the            amendment date.  So,  if the 1995 amendment  did away with  a            previously  required  element  of targeting  motivation,  the            prior guideline might have to be followed under ex post facto                                                            _____________            principles.    See  U.S.S.G.      1B1.11;  United  States  v.                           ___                         ______________            Prezioso, 989 F.2d 52, 53-54 (1st Cir. 1993).            ________                 Gill's  argument about  targeting leans  heavily on  our            opinion in  Rowe.  The  Rowe case  involved a scheme  to sell                        ____        ____            fraudulent  health   insurance  policies  to   various  small            businesses, that  were  not,  in our  opinion,  shown  to  be            unusually vulnerable under section 3A1.1.  Rowe,  999 F.2d at                                                       ____            16-17.  When the  government said that some of  the employee-            patients might have  been unusually vulnerable--because  once            insured they  could not  easily switch  companies--we replied            that  there  was no  "special  targeting  [by Rowe]  of  such            victims."  Id. at 17.                       ___                 The confusion  is understandable, and wholly  of our own            making, but  it does not  help Gill.   All that we  meant was            that the case might  have been different if the  Rowe's fraud                                         -11-                                         -11-            had involved  direct dealings between Rowe  and the employee-            patients  whereby the success of his scheme had depended upon            the latter's  vulnerability.  See, e.g.,  Bachynsky, 949 F.2d                                          ___  ____   _________            at 735 (upholding enhancement against physician who submitted            false claims to insurers  after seeing vulnerable  patients).            In short, the reference  to targeting in Rowe had  nothing to                                                     ____            do  with laying  down a  separate and  additional requirement            that the primary subject  of the fraud be a "target," as well            as foreseeably vulnerable to an unusual degree.                   Although the  circuits are divided,2  such an additional            requirement  of  "targeting,"  even  under  the pre-amendment            guideline,  is  at  odds  with the  evident  purpose  of  the            guideline: to  punish more  severely conduct that  is morally            more  culpable and  to protect  such victims  by adding  more            deterrence.   See, e.g., United  States v.  Brunson, 54  F.3d                          _________  ______________     _______            673, 676  (10th Cir.),  cert. denied,  116 S.Ct. 397  (1995);                                    _____ ______            United States v. Morrill, 984  F.2d 1136, 1137-38 (11th  Cir.            _____________    _______            1993).   Further, to require subjective motivation undermines            the guideline's own lesser scienter requirement, namely, that            the defendant  "knew or  should have known"  of the  victim's            unusual vulnerability.                                            ____________________                 2Compare United  States v. O'Brien, 50  F.3d 751, 755-56                  _______ ______________    _______            (9th Cir.  1995) (declining to impose  a scienter requirement            of targeting beyond the "knew or should have known" standard)            with  United States v. Holmes,  60 F.3d 1134,  1136 (4th Cir.            ____  _____________    ______            1995)  (discussing  additional  targeting  requirement),  and                                                                      ___            United  States v.  Smith, 39  F.3d 119,  124 (6th  Cir. 1994)            ______________     _____            (adopting targeting requirement).                                          -12-                                         -12-                 In the present case,  the main subjects of  Gill's fraud            include both  the patients  with whom he  dealt directly  and            those  third  parties  who  were billed,  such  as  insurance            companies.  It is  a reasonable, indeed compelling, inference            that  the former  include at  least some  who were  unusually            vulnerable and were foreseeably so.  That is enough under the            guideline, pre  and post amendment, regardless  of Gill's own            private  motivation.    If  Rowe  has  confused  matters,  as                                        ____            apparently it has, we are happy to set the record straight.                 Abuse of Position of  Trust.  Gill also argues  that the                 ___________________________            district court erred in enhancing his sentence under U.S.S.G.              3B1.3.   That section provides for  a two-level enhancement            "if the  defendant abused  a  position of  public or  private            trust  . . . in  a manner that  significantly facilitated the            commission or concealment of the offense."  U.S.S.G.   3B1.3.            Thus, the district court must first decide that the defendant            occupied a position of trust and then  find that he used that            position to  facilitate or conceal  the offense.   See United                                                               ___ ______            States v. Santiago-Gonzalez, 66 F.3d 3, 8 (1st Cir. 1995).            ______    _________________                 Here  the district  court concluded  that, at  least "in            real life terms," Gill occupied  a position of trust relative            to his  counseling patients, and that Gill  took advantage of            the   patients'  reliance   on  his   claimed  status   as  a            psychologist to  further his  fraud scheme.   Gill challenges            both  findings, claiming that he  did not hold  a position of                                         -13-                                         -13-            trust as intended  by the  guideline, and that  there was  no            evidence that he abused his position.                 Were  Gill a  duly  licensed psychologist  who used  his            status  as a  mental health  professional to  perpetrate some            fraud or  other crime upon  his patients and  their insurers,            there  is no  doubt  that section  3B1.3's enhancement  would            apply.   "Effective  psychotherapy  . .  .  depends  upon  an            atmosphere  of confidence and  trust in which  the patient is            willing  to make  a frank  and complete disclosure  of facts,            emotions, memories, and  fears."  Jaffee  v. Redmond, 116  S.                                              ______     _______            Ct.  1923, 1928 (1996).  The guideline phrase "private trust"            readily describes  the relationship  of a psychologist  vis a            vis his or her patients.                 Gill argues that because  he did not legitimately occupy                                                      ____________            the position  of counselor, he  did not "hold"  that position            under section 3B1.3.   This argument  has persuaded at  least            one other circuit.  In Echevarria, 33 F.3d at 181, the Second                                   __________            Circuit reversed  a section 3B1.3 enhancement  on a defendant            who falsely held  himself out  as a  physician, stating  that            "[w]e  do not believe  that an imposter  `holds' the position            that  he  purports  to  occupy within  the  meaning  of  this            commentary."  It does not persuade us.                 We  appreciate that read  literally, the guideline could            be taken to  refer only  to one who  legally or  legitimately            occupied a position of trust, presumably the usual case.  But                                         -14-                                         -14-            the  threat  that animates  the  guideline may  as  easily be            present  where the position is occupied by an imposter.  That            threat--illustrated by the  lawyer who bilks a  client out of            trust funds  or the doctor who sexually  abuses a patient--is            that wrongdoer's  position facilitates the crime, reduces the            chance of detection, or both.  See U.S.S.G.   3B1.3, comment.                                           ___            n.1.                 The  threat is  equally  present whether  the lawyer  or            doctor is fully licensed or is a pretender sporting a vest or            white coat and displaying a fake diploma.  In both cases, the            wrongdoer is  using the ostensible position  to facilitate or            conceal the crime, just as  Gill's extraction of payments was            facilitated by his claim to be a licensed counselor.  Our own            cases have stressed the practical realities rather than legal            title in applying this adjustment.3  This is also the view of            the Tenth Circuit in United States v. Queen, 4 F.3d 925, 929-                                 _____________    _____            30 (10th Cir. 1993).                 The district court here found that Gill did acquire, "in            real life terms . . . by virtue of his conduct" a position of            trust relative to his patients.  "Trust" alone, of course, is                                            ____________________                 3See United States v. Newman, 49 F.3d 19 (1st Cir. 1995)                  ___ _____________    ______            (section 3B1.3  enhancement upheld  against  a defendant  who            defrauded a  corporation that  was under his  actual control,            despite the  fact that he  had never properly  obtained legal            authority  over  the  corporation);  cf.  United   States  v.                                                 __   _______________            Innamorati, 996 F.2d 456,  489-90 (1st Cir.) (former registry            __________                                    ______            police  officer  subject  to  enhancement  if  prior position            facilitated crime), cert. denied, 510 U.S. 955 (1993).                                ____________                                         -15-                                         -15-            not  enough; there  must  also  be  a  "position."    But  by            pretending,  Gill effectively occupied  the "position" so far            as the present guideline is concerned.                 Affirmed.                 ________                                         -16-                                         -16-
