13-1094-cr
United States v. Thorndike


                                  UNITED STATES COURT OF APPEALS
                                     FOR THE SECOND CIRCUIT

                                     SUMMARY ORDER
Rulings by summary order do not have precedential effect. Citation to a summary order filed on or
after January 1, 2007, is permitted and is governed by Federal Rule of Appellate Procedure 32.1 and
this Court’s Local Rule 32.1.1. When citing a summary order in a document filed with this Court, a
party must cite either the Federal Appendix or an electronic database (with the notation “summary
order”). A party citing a summary order must serve a copy of it on any party not represented by
counsel.

        At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 23rd
day of April, two thousand fourteen.

PRESENT:
            GUIDO CALABRESI,
            JOSÉ A. CABRANES,
            DEBRA ANN LIVINGSTON,
                         Circuit Judges.
_____________________________________

UNITED STATES OF AMERICA,

                    Appellee,

                             v.                                      No. 13-1094-cr

THOMAS THORNDIKE,

            Defendant-Appellant.
_____________________________________

FOR THOMAS THORNDIKE:                                ANDREW B. BOWMAN, Law Offices of
                                                     Andrew B. Bowman, Wesport, CT.

FOR UNITED STATES OF AMERICA:                        CHRISTOPHER M. MATTEI (Sandra S. Glover,
                                                     on the brief), Assistant United States Attorneys,
                                                     for Deirdre M. Daly, Acting United States
                                                     Attorney, United States Attorney’s Office for
                                                     the District of Connecticut, Hartford & New
                                                     Haven, CT.
       Appeal from a judgment of conviction, entered March 13, 2013, of the United States District
Court for the District of Connecticut (Alvin W. Thompson, Judge).

     UPON DUE CONSIDERATION WHEREOF, IT IS HEREBY ORDERED,
ADJUDGED, AND DECREED that the judgment of the District Court is AFFIRMED.

         Thomas Thorndike appeals from a judgment of the United States District Court for the
District of Connecticut, sentencing him principally to 72 months’ imprisonment for aiding and
assisting the preparation of a false tax return, in violation of 26 U.S.C. § 7206(2), and making and
subscribing a false tax return, in violation of 26 U.S.C. § 7206(1). On appeal, Thorndike challenges
the District Court’s calculation of his total offense level and the substantive reasonableness of his
sentence. We assume the parties’ familiarity with the underlying facts and the procedural history of
the case, to which we refer only as necessary to explain our decision to affirm.

                                          BACKGROUND

        Thorndike owned and operated Cornerstone Financial Services, a high-volume tax-return
preparation business. From 2006 through 2009, Thorndike routinely falsified his clients’ returns by
fabricating deductions, resulting in illegitimate tax refunds for his clients and repeat business for
Thorndike. Thorndike also offered audit insurance, under which he agreed to represent his clients
in the event their returns were audited.

        In December 2008, the IRS informed Thorndike that they were initiating an audit of the tax
returns he had prepared during 2006 and 2007. After several of Thorndike’s clients were notified by
the IRS that their returns would be audited, the clients contacted Thorndike and asked him to
represent them in connection with the audit. Without advising that he was the actual subject of the
audit, Thorndike scheduled an appointment with each client to review, often for the first time, their
2006 and 2007 tax returns. During the review, Thorndike advised his client to create false
documents to support the false entries on their returns. The clients complied with Thorndike’s
instructions, despite knowing the entries were false, and Thorndike then presented the false
documents to the IRS.

         On September 22, 2011, the grand jury returned a 28-count Superseding Indictment,
charging Thorndike with a variety of tax-related offenses. On October 11, 2012, the parties
appeared for trial. Following opening statements, Thorndike entered guilty pleas to one count of
assisting the preparation of a false tax return, in violation of 26 U.S.C. § 7206(2) (count 17), and one
count of making and subscribing a false tax return, in violation of 26 U.S.C. § 7206(1) (count 26).

      The parties appeared for sentencing on March 12, 2013. The District Court calculated that
Thorndike had a total offense level of 26, resulting in a Guidelines range of 63 to 72 months’
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imprisonment. The Court then imposed a sentence of 72 months’ imprisonment—the statutory
maximum penalty. This timely appeal followed.

                                            DISCUSSION

         Thorndike’s principal challenge on appeal is to the District Court’s calculation of his
Guidelines range, specifically the application of three enhancements and denial of a reduction for
acceptance of responsibility. In evaluating a decision to impose an enhancement, we review the
District Court’s factual findings for clear error, but review legal determinations about the
applicability of the enhancement de novo. United States v. Ivezaj, 568 F.3d 88, 99 (2d Cir. 2009).
Whether a defendant “has accepted responsibility is a factual question,” and the district court’s
resolution of that question will “not be disturbed unless it is without foundation.” United States v.
Taylor, 475 F.3d 65, 68 (2d Cir. 2007) (internal quotation marks omitted).

         Thorndike first contests the District Court’s application of a four-level enhancement for
being “an organizer or leader of a criminal activity that involved five or more participants.” U.S.S.G.
§ 3B1.1(a). A “participant,” for purposes of § 3B1.1, is “a person who is criminally responsible for
the commission of the offense, but need not have been convicted.” Id. cmt. n.1. We reject
Thorndike’s contention that his clients were not “criminally responsible” in light of the District
Court’s finding that Thorndike’s clients knowingly created false documents for Thorndike to submit
to the IRS on their behalf in order to substantiate false entries on their returns. See United States v.
Brinkworth, 68 F.3d 633, 642 (2d Cir. 1995) (participant criminally responsible because he “knew that
certain income reported on the financial statements was not reported on the tax returns”).

         Thorndike also argues that the District Court’s application of this enhancement resulted in
impermissible “double counting” because it penalized the same conduct supporting the two-level
enhancement he received under U.S.S.G. § 2T1.4(b)(1)(B) for being in the business of preparing tax
returns. “[W]e have consistently held that double counting is permissible in calculating a Guidelines
sentence where . . . each of the multiple Guidelines sections applicable to a single act serves a
distinct purpose or represents a discrete harm.” United States v. Maloney, 406 F.3d 149, 153 (2d Cir.
2005). Because Thorndike not only prepared his clients’ returns, but directed them to fabricate
documents for submission to the IRS, the role enhancement penalized distinct conduct.

        Thorndike next challenges the two-level enhancement he received under U.S.S.G.
§ 2T1.4(b)(2) based on the District Court’s finding that the offense “involved sophisticated means.”
Application Note 3 of this section defines “sophisticated means” as “especially complex or
especially intricate offense conduct pertaining to the execution or concealment of an offense.”
U.S.S.G. § 2T1.4(b), cmt. n.3. As the District Court rightly found, the use of audit insurance in
conjunction with the false returns, which resulted in a coordinated response to the IRS and the
fabrication of documents, provided Thorndike with a sophisticated means of concealing his own
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fraud. See United States v. Jackson, 346 F.3d 22, 25 (2d Cir. 2003) (“[E]ven if each step in the scheme
was not elaborate, the total scheme was sophisticated in the way all the steps were linked together so
that [defendant] could perceive and exploit different vulnerabilities in different systems in a
coordinated way.”).

          We similarly find no merit to Thorndike’s argument that the District Court erred in applying
an enhancement for obstructing the administration of justice under U.S.S.G. § 3C1.1. This
enhancement covers a range of conduct including, inter alia, “producing or attempting to produce a
false, altered, or counterfeit document or record during an official investigation or judicial
proceeding.” U.S.S.G. § 3C1.1, cmt. n.4(C). It also applies to obstruction of civil investigations,
including IRS audits, because “subsequent criminal investigations are often inseparable from prior
civil investigations, and [obstruction] in the prior proceeding necessarily obstructs—if successful, by
preventing—the subsequent investigation.” United States v. Fiore, 381 F.3d 89, 94 (2d Cir. 2004). We
accordingly reject Thorndike’s argument that the enhancement is inapplicable because the audits at
issue were conducted by civil revenue agents.

        Moreover, the District Court did not engage in impermissible double counting because both
the obstruction and sophisticated means enhancements relied upon similar conduct. As the District
Court noted, the conduct was no simple act or series of actions to obstruct justice, but rather, was
especially complex or especially intricate.

        Thorndike’s final procedural challenge is to the District Court’s denial of a two-level
reduction under U.S.S.G. § 3E1.1(a), which applies if the defendant “clearly demonstrates
acceptance of responsibility for his offense.” U.S.S.G. § 3E1.1(a). The District Court’s
determination that Thorndike did not “clearly demonstrate acceptance of responsibility” is
supported by his lack of contrition at the change of plea proceeding, in a statement to the media,
and at his sentencing hearing.1

        Finally, Thorndike challenges the substantive reasonableness of his sentence. In examining
this challenge, we review the length of the sentence imposed to determine whether it “cannot be
located within the range of permissible decisions.” United States v. Watkins, 667 F.3d 254, 261 (2d
Cir. 2012) (internal quotation marks omitted). Having reviewed the record, Thorndike’s sentence of
72 months’ imprisonment, although within the relevant Guidelines range, is rather harsh in the
circumstances presented here. Nonetheless, we cannot conclude that it is substantively
unreasonable, substantially for the reasons given by the District Court at the defendant’s sentencing


          1 Thorndike also makes a procedural challenge contending that the District Court erred in denying a downward

departure because of the overlapping enhancements and because of his charitable work and medical condition. Yet the
refusal to downwardly depart is generally not appealable, except where the Court misapprehends that it lacks the
authority to do so. United States v. Stinson, 465 F.3d 113, 114 (2d Cir. 2006). The District Court acknowledged its
authority to depart on the grounds articulated by Thorndike, but simply declined to do so.
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hearing of March 12, 2013—most importantly, the need for just punishment in light of the length
and scope of Thorndike’s fraudulent activity.

                                        CONCLUSION

       We have considered all of the arguments raised by Thorndike on appeal and find them to be
without merit. For the reasons stated above, we AFFIRM the District Court’s March 13, 2013
judgment.

                                                    FOR THE COURT:
                                                    Catherine O’Hagan Wolfe, Clerk




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