US v. James Whitley

Filing

UNPUBLISHED PER CURIAM OPINION filed. Originating case number: 7:10-cr-00105-FL-1 Copies to all parties and the district court/agency. [999188977].. [12-4062]

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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 12-4062

UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
JAMES EDWARD WHITLEY,
Defendant - Appellant.

Appeal from the United States District Court for the Eastern
District of North Carolina, at Wilmington. Louise W. Flanagan,
District Judge. (7:10-cr-00105-FL-1)

Argued:

February 1, 2013

Decided:

September 9, 2013

Before GREGORY and KEENAN, Circuit Judges, and Robert E. PAYNE,
Senior United States District Judge for the Eastern District of
Virginia, sitting by designation.

Affirmed by unpublished per curiam opinion. Senior Judge Payne
wrote a separate opinion concurring in part and concurring in
the judgment.

ARGUED: James Ryan Hawes, EDMISTEN & WEBB, Raleigh, North
Carolina, for Appellant. Jennifer P. May-Parker, OFFICE OF THE
UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellee.
ON BRIEF: Thomas G. Walker, United States Attorney, Kristine L.
Fritz, Assistant United States Attorney, OFFICE OF THE UNITED
STATES ATTORNEY, Raleigh, North Carolina, for Appellee.

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Unpublished opinions are not binding precedent in this circuit.

2

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PER CURIAM:
James

Edward

Whitley

pleaded

guilty

to

charges

of

wire

fraud, in violation of 18 U.S.C. § 1343, and money laundering,
in violation of 18 U.S.C. § 1957, based on his activities in
conducting a fraudulent investment scheme.

The district court

found that under the United States Sentencing Guidelines (the
guidelines), Whitley’s advisory range of imprisonment was 57 to
71 months on each count.

Upon determining that sentences within

the guidelines range would be insufficient, the court imposed
concurrent

sentences

of

120

months’

imprisonment

on

the

two

counts.
On appeal, Whitley argues that the district court committed
procedural

error

in

its

sentencing

determination

because

the

court did not specify whether it was imposing departure-based
sentences under the guidelines, or instead was imposing variant
sentences based on the factors set forth in 18 U.S.C. § 3553(a).
Whitley

further

argues

that

the

sentences

unreasonable because they are excessive.

are

substantively

Upon our review, we

conclude that the district court did not commit procedural or
substantive

error

as

alleged.

Accordingly,

district court’s judgment.

3

we

affirm

the

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I.
In

September

2010,

a

grand

jury

issued

a

twenty-count

indictment charging Whitley with six counts of wire fraud and
fourteen counts of money laundering.

These charges resulted

from a government investigation revealing that Whitley engaged
in a three-year scheme of defrauding friends, family members,
and acquaintances (collectively, the victims), who had invested
their

money

with

Whitley.

Whitley

solicited

funds

from

the

victims by representing that he was in the business of brokering
purchase order factoring contracts. 1

Whitley told the victims

that he had contracts with certain companies, that the victims’
funds would be invested in those companies, and that the victims
would receive their return of capital after the expiration of
the

companies’

factoring

contracts.

Whitley

provided

the

victims with promissory notes specifying both interest rates and
due dates.
Whitley did not use any of the funds he received from the
victims to invest in a factoring business.

Instead, Whitley

used the funds to further his fraudulent scheme and for his
personal use.

For instance, as is typical of a Ponzi scheme,

1

A “purchase order factoring contract” is needed when a
supplier requires that a buyer pay for goods by cash on
delivery, but the buyer wants to purchase the goods on 30 to 60
day terms.
The purchase order contractor agrees to pay the
supplier upon delivery of the goods, which enables the buyer to
delay payment for a specified period of time.
4

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Whitley used some of the funds he received from later investors
to

pay

initial

investors

interest

on

the

money

they

had

provided, thereby creating the impression that the investment
was successful.

Whitley also used some of the proceeds from his

scheme

off

to

pay

a

construction

loan

for

his

secondary

residence, a beach house on Bald Head Island, North Carolina.
Additionally, Whitley used some funds provided by the victims to
take beach vacations to the Caribbean and ski trips to Colorado.
Whitley’s scheme affected at least 25 victims and resulted in a
collective loss of about $7 million.
Whitley and the government entered into a plea agreement,
under which Whitley agreed to plead guilty to one count of wire
fraud and one count of money laundering in exchange for the
government agreeing to dismiss the other 18 counts alleged in
the

indictment.

The

parties

also

stipulated

in

the

plea

agreement that the amount of loss was between $2.5 million and
$7

million

for

sentencing range.
guilty

plea,

the

purposes

of

Whitley’s

advisory

guidelines

After the district court accepted Whitley’s
United

States

Probation

Office

prepared

Whitley’s presentence investigation report (PSR), in which the

5

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probation officer calculated an advisory guidelines range of 57
to 71 months’ imprisonment. 2
At Whitley’s sentencing hearing, the district court adopted
the

probation

advisory

officer’s

guidelines

calculations

range.

The

concerning

district

court

Whitley’s
also

heard

testimony from six victims concerning the impact of Whitley’s
fraudulent scheme on their lives.

Additionally, counsel from

the government read statements from several other victims who
were unable to attend the hearing.
The
that

evidence

presented

Whitley’s

at

conduct

the

sentencing

created

hearing

significant

showed

emotional

consequences for some victims, contributed to the demise of a
marriage,

and

impaired

education plans.

Whitley’s

investment

funds,

when

of

the

victims’

retirement

and

The victims’ statements and testimony also

described

victims

some

tenacious

the

they

manner

inquired

and
in

persistent

which

about

Whitley

their

pursuit
lied

to

investments,

of
the
and

Whitley’s lack of remorse toward them and his failure to attempt
to repay the victims for their losses.
that

the

district

court

sentence

The government asked

Whitley

to

a

term

of

imprisonment “at the upper end” of his guidelines range, while

2

This range was calculated based in part on the parties’
agreement concerning the amount of loss, which resulted in a
total offense level of 25 under the guidelines.
6

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Whitley’s counsel requested sentences “within the guideline[s]
range.”
After receiving this evidence and considering the parties’
arguments, the district court sentenced Whitley to a term of
imprisonment

of

concurrently.

120

months

on

each

count,

to

be

served

The court stated that it considered Whitley’s

advisory guidelines range and the sentencing factors set forth
in 18 U.S.C. § 3553(a), and explained that the court did not
think

“that

3553(a)]
promote
criminal

the

advice

factors
respect

of

fully[,]

the

for

conduct.”

[m]ost

guidelines

the

law

and

The

court

reflects

particularly,
to

noted

discourage
that

the

[§

the

need

to

this

type

of

“preyed

on

Whitley

people who had reason to trust [him],” that Whitley’s tactics
were aggressive and persistent, and that the impact of Whitley’s
conduct

was

“overwhelming.”

The

court

also

observed

that

Whitley continued to conduct his fraudulent scheme even after
becoming

aware

activities.

that

the

government

was

investigating

his

Near the end of the hearing, the district court

provided further explanation why the court had “gone above the
guideline[s] range,” stating that:
[T]he guideline[s] sentence does not accomplish [sic]
in this case, given the pervasive nature of the scheme
and the persons upon whom [Whitley] preyed and the
impact upon those individuals, for all these reasons,
also including what appears to be a lack of penitence
on the part of [Whitley] where there’s been [an]
opportunity . . . given [to] him by the Court to begin
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to collect funds. I’m compelled to conclude that he’s
a very dangerous person and that there’s a complete
lack of respect for the law.
In announcing the sentences from the bench, the district
court mentioned the § 3553(a) factors on several occasions but
did not use either the term “variance” or the term “departure”
in explaining the sentences.

Notably, Whitley’s counsel did not

ask the court during the sentencing hearing to specify whether
the court was departing from the advisory guidelines range or
instead was imposing variant sentences.

After the court issued

its judgment and written statement of reasons, Whitley timely
filed a notice of appeal.

II.
A.
We

first

address

Whitley’s

reasonableness of his sentences.

challenge

to

the

procedural

As a general matter, we review

a district court’s imposition of a sentence, whether within or
outside

a

defendant’s

advisory

deferential

abuse-of-discretion

States,

552

U.S.

asserts

that

38,

Whitley’s

41

guidelines
standard.

(2007).

procedural

The

range,
Gall

under
v.

government,

reasonableness

a

United
however,

challenge

is

subject to review only for plain error, because Whitley did not
raise in the district court the argument he presents here.

8

See

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United States v. Olano, 507 U.S. 725, 732-34 (1993) (discussing
plain error standard of review).
We need not determine whether the more rigorous plain error
standard

applies

in

this

case,

because

we

conclude

that

the

district court did not commit procedural error as alleged by
Whitley,

plain

or

otherwise.

Whitley’s

sole

contention

concerning procedural error is that the district court erred by
“fail[ing] to specify at the sentencing hearing whether [the
court] departed or varied in doubling the advisory guidelines
[range].”

Br. of Appellant at i, 10.

Whitley concedes that

under our precedent, a district court is not required to “first
look to whether a departure is appropriate before varying.”
United

States

v.

Diosdado-Star,

2011) (citation omitted).
sentencing
allegedly

hearing
failed

is

to

630

F.3d

359,

366

(4th

See
Cir.

However, Whitley contends that a new
required

state

because

whether

it

the

varied

district
or

court

departed

in

determining the 120-month sentences, and thus that the court
violated the general principle stated in Diosdado-Star that a
court must “adequately explain the chosen sentence to allow for
meaningful appellate review and to promote the perception of
fair sentencing.”

Id. at 365 (citation omitted); see Gall, 552

U.S. at 51 (listing ways in which a district court may commit
procedural error, including by failing to adequately explain the
chosen sentence).
9

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We reject Whitley’s argument because it is based on his
mistaken assertion that there is “no way to determine how the
[district] court arrived at the 120 month sentence[s].”
Appellant

at

12.

The

record

of

the

sentencing

Br. of

proceedings

refutes Whitley’s argument, and shows that the district court
imposed

variant

sentences,

rather

than

departure-based

sentences.
The

term

“departure”

has

a

unique

meaning

under

the

guidelines, and “refers only to non-Guidelines sentences imposed
under the framework set out in the Guidelines.”
United States, 553 U.S. 708, 714 (2008).
identified

a

2B1.1(b)(1), 3

possible
the

basis

district

for
court

Here, although the PSR

departure
did

Irizarry v.

not

under

U.S.S.G.

§

focus

either

on

Whitley’s offense level or on any fees or other similar costs
incurred.

Thus, we conclude that the sentences were not imposed

on the basis of this guidelines provision.

Nor did the district

court give the parties notice that the court was considering the
imposition of departure-based sentences for any other reason, as
3

Under
Application
Note
19(A)(iii)
to
U.S.S.G.
§
2B1.1(b)(1), a district court may make an upward departure to a
defendant’s guidelines range in cases in which the offense level
“substantially understates the seriousness of the offense,” on
account of the offense involving a substantial amount of
interest, finance charges, late fees, penalties, or “other
similar costs, not included in the determination of loss.” The
PSR mentioned this provision, but the probation officer did not
make a recommendation concerning whether Whitley’s sentence
should be increased based on such a departure.
10

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would

be

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required

under

Rule

Pg: 11 of 32

32(h)

of

the

Federal

Rules

of

Criminal Procedure.
By

contrast,

“variant”

sentences

are

drawn

from

consideration of the sentencing factors set forth in § 3553(a).
See Irizarry, 553 U.S. at 714-15; see also United States v.
Rivera-Santana, 668 F.3d 95, 100 n.6 (4th Cir. 2012) (discussing
the

difference

between

a

departure,

a

sentence

imposed

by

reference to the defendant’s guidelines range, and a variance,
“a non-Guidelines sentence” that is justified on the basis of
the

§

3553(a)

factors)

(citation

omitted).

During

the

sentencing hearing, the district court referred frequently to
certain factors set forth in § 3553(a) in explaining Whitley’s
sentences.

Moreover, the written statement of reasons issued by

the district court specified that the court imposed sentences
“outside the advisory sentencing guideline system,” 4 and that
“the

court

varied

imprisonment.”

upwardly

to

(Emphasis added.)

a

sentence

of

120

months[’]

Based on these statements in

the record, we easily conclude that the district court imposed
variant sentences, not departure-based sentences.

4

Accordingly,

The statement of reasons form includes a “check box” that
would allow a court to indicate departure-based sentences.
However, the district court did not mark that box denoting
departure-based sentences, and instead marked the box indicating
sentences based outside the guidelines system.
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we hold that Whitley’s procedural reasonableness claim lacks any
merit.
In reaching this conclusion, we additionally observe that
Whitley

has

not

challenged

the

validity

of

our

holding

in

Diosdado-Star that a district court is not required to consider
whether

any

departures

under

the

before imposing a variant sentence.
oral

argument

question
1B1.1 5

in

whether

have

Nevertheless,

this
the

case,

we

do

not

the

2010

above

answer

are

applicable

See 630 F.3d at 365-66.

however,

November

undermined

guidelines

this

Court

amendments
holding

that

in

question

to

raised

At
the

U.S.S.G.

§

Diosdado-Star.
here,

because

Whitley waived any such argument due to his failure to raise it
in his brief to this Court.

See Equal Rights Ctr. v. Niles

Bolton Assocs., 602 F.3d 597, 604 n.4 (4th Cir. 2010) (holding
that the appellant waived an argument by not raising it in the
opening brief, even though that issue was discussed by the panel
and the parties during oral argument); see also United States v.

5

The current iteration of that commentary section, titled
“Application Instructions,” was enacted after appellate briefing
in Diosdado-Star but before oral argument and the issuance of
the opinion in that case. The Application Instructions provide
that district courts “shall determine the kinds of sentence and
the guideline range as set forth in the guidelines . . . by
applying the provisions of this manual in the following order,”
and lists the consideration of any departures from the
guidelines before listing the consideration of the § 3553(a)
factors.
The parties in Diosdado-Star did not bring to this
Court’s attention this revision to U.S.S.G. § 1B1.1.
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Hudson, 673 F.3d 263, 268 (4th Cir. 2012) (holding that issues
not

raised

cites

in

with

opening

approval

brief
in

his

are

waived).

brief

the

Moreover,

very

Whitley

proposition

in

Diosdado-Star that this Court raised during oral argument in
Whitley’s appeal, namely, that “a district court is not required
to

‘first

look

varying.’”

to

whether

a

departure

is

appropriate

before

Br. of Appellant at 10 (quoting Diosdado-Star, 640

F.3d at 365-66).

Accordingly, we hold that Whitley’s reliance

on Diosdado-Star and his failure to challenge its vitality in
light of amended U.S.S.G. § 1B1.1 precludes consideration of
that issue here.
B.
Finally, we determine whether the district court abused its
discretion
months’

in

sentencing

imprisonment,

guidelines range.
sentencing

to

sentences

well

we

review

regardless

the

whether

526 F.3d 155, 164 (4th Cir. 2008).
are

above

outside

the

defendant’s

sentences
they

guidelines or were variant sentences.

that

concurrent

terms
his

of

120

advisory

In conducting a review of alleged substantive

error,

reasonableness,

Whitley

were

imposed
based

on

for
the

United States v. Evans,
When reviewing sentences

advisory

guidelines

range,

imposed either by departure or by variance, we consider whether
the district court “acted reasonably both with respect to its
decision

to

impose

such

a

sentence
13

and

with

respect

to

the

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extent of the divergence from the sentencing range.”
States

v.

2007).
trial

Hernandez-Villanueva,

F.3d

118,

123

(4th

Cir.

In undertaking this analysis, we “must defer to the
court

unreasonable,
choice

473

United

of

and

can

even

the

if

reverse
the

a

appellate

sentence
court.”

sentence
would

only

not

Evans,

if

526

is

been

have

it

the

at

160

F.3d

(emphasis omitted).
In

sentencing

Whitley

on

the

basis

of

the

§

3553(a)

factors, the district court observed the “pervasive nature” of
Whitley’s

fraudulent

scheme,

the

manner

in

which

perpetuated the fraud, and his lack of remorse.

he

had

The court also

considered the testimony of Whitley’s victims, who discussed the
impact

of

Whitley’s

fraudulent

scheme

on

their

lives.

See,

e.g., id. at 163 (discussing with approval the district court’s
consideration of the victims’ statements in affirming a sentence
that was more than four times as much as the upper end of the
defendant’s

advisory

guidelines

range).

Most

notably,

the

district court discussed the need for sentences in excess of the
guidelines range to protect the public, because when Whitley was
“on notice of [the] investigation and notice of wrongdoing [he]
continued to prey on others.”

The district court also noted

that substantial terms of imprisonment were justified by the
need to provide adequate deterrence regarding similar criminal
conduct and to promote respect for the law.
14

After reviewing

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these reasons provided by the district court, as well as the
entire sentencing record and the parties’ arguments, we conclude
that Whitley’s concurrent sentences of 120 months’ imprisonment
are not substantively unreasonable.

III.
For these reasons, we affirm the district court’s judgment.

AFFIRMED

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PAYNE, Senior District Judge, concurring in part and concurring
in the judgment:
I

agree

with

the

majority

that

Whitley’s

sentence

is

substantively reasonable.

However, for the reasons that follow,

I

asserted

submit

that

Whitley’s

procedural

error

should

be

reviewed under the plain error standard; that there was plain
error; but that the error did not affect Whitley’s substantial
rights.

I.
Whitley and the government disagree about the applicable
standard of review of the alleged procedural error.

Whitley

contends that the abuse of discretion standard applies.
government

contends

that

the

plain

error

standard

of

The
review

controls because the challenges raised by Whitley are presented
for the first time on appeal.
In

United

States

v.

Lynn,

592

F.3d

572,

576

(4th

Cir.

2010), the Court held “that plain-error review applies when a
party lodges an objection to the sort of procedural sentencing
error at issue here [inadequate explanation of sentencing] for
the first time on appeal.”

Id. at 577.

See United States v.

Hargrove, 625 F.3d 170, 183-84 (2010) (pointing out that Lynn
called for plain error review when a procedural sentencing error
is raised for the first time on appeal).

Also, in Lynn, the

Court explained how a party can preserve a claim of procedural
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sentencing

Filed: 09/09/2013

error.

The

Pg: 17 of 32

Court

stated

that,

“[b]y

drawing

arguments from § 3553 for a sentence different than the one
ultimately imposed, an aggrieved party sufficiently alerts the
district court of its responsibility to render an individualized
explanation addressing those arguments, and thus preserves its
claim.”

Id. at 578 (emphasis added).

Later, in United States

v. Boulware, 604 F.3d 832, 838 (4th Cir. 2010), citing Lynn, the
Court held that “arguments made under § 3553(a) for a sentence
different than the one that is eventually imposed are sufficient
to

preserve

adequately

claims

that

explaining

the

its

district

court

rejection

of

erred
the

in

not

sentencing

arguments.” (emphasis added).

II.
In

Gall

v.

United

States,

552

U.S.

38,

40

(2007),

the

Supreme Court identified several kinds of procedural errors that
can occur at sentencing.

Among them was “failing to adequately

explain the chosen sentence - including an explanation for any
deviation from the Guidelines range.”

Gall, 552 U.S. at 51.

Whitley contends that:
[t]he district court procedurally erred when it failed
to specify at the sentencing hearing whether it
departed or varied in imposing a sentence that doubled
the guideline range. This error resulted in a failure
to adequately explain its decision to impose the 120
month sentence and, therefore, the sentence must be
vacated.
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Appellant’s Brief, at 10.

Pg: 18 of 32

Thus, Whitley raises the kind of

procedural error that is identified in the last phrase of the
exemplary list of procedural errors provided in Gall.
To

decide

whether

Whitley

preserved

that

error,

it

is

necessary to determine whether, in the sentencing proceedings,
Whitley drew “̒arguments from § 3553 for a sentence different
than

the

one

ultimately

imposed . . . .’”

United

States

v.

Powell, 650 F.3d 388, 395 (4th Cir. 2011) (citation omitted)
(emphasis in original); Boulware, 604 F.3d at 838; Lynn, 592
F.3d at 578.

The arguments necessary to preserve an error of

this sort can be set forth in written sentencing positions filed
before

the

hearing.

sentencing

hearing

or

in

arguments

made

at

the

Neither Whitley nor the government filed a written

pre-sentencing

submission.

Therefore,

the

record

at

the

sentencing hearing must be examined to see whether there Whitley
drew

any

argument

from

§

3553(a)

for

a

sentence

different than the one the court ultimately imposed.

that

was

The record

demonstrates that he did not.
In
points:

his

sentencing

argument,

Whitley’s

counsel

made

four

(1) that Whitley had made a bad decision for which he

had “accepted responsibility” and “entered a plea agreement;”
(2) that Whitley had suffered in his personal life for that bad
decision and had been forced into bankruptcy; (3) that Whitley’s

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wife had divorced him and his children had “alienated him;” and
(4)

that

“his

property

has

been

foreclosed

on.”

Having

made

those points, counsel then said, “we ask that you sentence him
to a sentence within the guideline range.” 1
Quite clearly, Whitley’s arguments for a within-Guideline
sentence cannot be said to be drawn from the factors in §§
3553(a)(2)-(7).

That

leaves

§

3553(a)(1),

“the

nature

and

circumstances of the offense and the history and characteristics
of the defendant.”

Whitley’s sentencing points do not refer to

“the nature and circumstances of the offense.”

Nor can the four

points raised in Whitley’s sentencing argument be fairly related
to either his history or characteristics.

Rather, in one way or

another, each point makes note of how the offense has affected
Whitley (points (2)-(4)) or recites a neutral fact, acceptance
of responsibility by pleading guilty, (point (1)).
The oblique references to the effects of Whitley’s crime on
him

and

to

the

fact

of

a

guilty

plea,

like

the

oblique

references in United States v. Powell, do not “̒sufficiently
alert

the

district

court

of

its

responsibility

to

render

an

individualized explanation addressing those arguments’ under §
3553” (quoting Lynn, 592 F.3d at 578).

1

In sum, Whitley did not

Counsel also asked that Whitley be confined in a specific
nearby prison and that he be allowed to “self-report” to begin
service of the sentence.
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“̒draw[] arguments from § 3553 for a sentence different than the
one ultimately imposed,’” and thus, even under the quite lenient
standard for preservation of such an error that the Court has
adopted, Whitley did not preserve the procedural error that he
now asserts

III.
To

demonstrate

establish that:

plain

error,

Whitley

is

obligated

to

(1) the trial court erred, (2) the error is

clear and obvious, and (3) the error affected his substantial
rights.
Hargrove,

United States v. Olano, 507 U.S. 725, 732-34 (1993);
625

F.3d

at

184.

If

Whitley

discharges

that

responsibility, the Court has discretion to recognize the error,
but need not do so unless it “seriously affect[s] the fairness,
integrity or public reputation of judicial proceedings.”

Olano,

507 U.S. at 736 (quotations and alterations omitted); Hargrove,
625 F.3d at 184.
Whether

an

error

is

appellate consideration.’”

plain

is

judged

“‘at

the

time

of

Henderson v. United States, ___ U.S.

___, 133 S. Ct. 1121, 1130 (2013) (citing Johnson v. United
States, 520 U.S. 461, 468 (1997)).
was previously unsettled.

Id.

20

That is so even if the issue

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A.
Whitley

argues

that

the

procedural

error

occurred

here

because, in imposing the non-Guideline sentence, the district
court did not specify whether the sentence was one chosen by way
of departure or by way of variance.
Whitley,

the

sentence

was

not

For that reason, says

adequately

explained

meaningful appellate review has been foreclosed.
the

failure

Guidelines

to
is

articulate
of

the

particular

mode

of

To Whitley,

deviation

significance

and

from

the

the

PSR

because

identified a possible predicate for departure under U.S.S.G. §
2B.1(b)(1) and then outlined the findings necessary to depart
thereunder, none of which did the district mention in imposing
the

sentence.

Whitley

also

posits

other

possible

bases

for

departure that the district court may have had in mind, but
about

which

it

did

not

remark.

In

perspective

of

the

availability of these possible predicates for departure, it is
argued that the district court’s failure to express whether it
was departing or varying constituted procedural error.
In support of his argument, Whitley cites United States v.
Diosdado-Star,

630

F.3d

359,

365

(4th

Cir.

2011).

However,

Diosdado-Star actually is contrary to the substance of Whitley’s
position

because

“departure”
364-65,

a

and

it

reasons

“variance”

concept

that

is

from
are
the
21

the

premise

that

interchangeable
polar

opposite

the

terms,
of

terms

id.

at

Whitley’s

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And, Diosdado-Star holds that “the method by which

the district court deviates from the Guidelines range does not
alter (1) the review in which courts of appeals must engage, or
(2) the justification the district court must provide,” id. at
365, holdings that are antithetical to the core of Whitley’s
argument.

Thus, although Whitley’s argument pays lip service to

Diosdado-Star,
premise

that

explained
articulates
methodology

in
a

or

substance,

non-Guideline
reviewed

whether
of

his

sentence

unless

the

variance

argument

the

the

cannot

district

methodology
is

proceeds

means

of
of

be

from

the

meaningfully

court

departure
deviating

actually
or

the

from

the

Guideline range, disposes of any possible ground for departure,
and then keys its explanation of the imposed sentence to the
chosen means of deviation.
Whitley’s substantive position finds support in Irizarry v.
United States, 553 U.S. 708, 714 (2008) which clarifies that,
comments to the contrary in Gall notwithstanding, “variances”
and “departures” are quite different kinds of sentencing modes.
A variance is a sentence outside the advisory Guideline range,
the imposition of which depends on an analysis of the factors in
§

3553(a).

A

departure

is

a

sentence

outside

the

advisory

Guideline range that depends on an analysis of the applicable

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departure provisions in the Guidelines.

Irizarry, 553 U.S. at

714-15. 2
Those

differences

are

significant

at

the

district

court

level because whether to depart requires a different analysis
than

that

required

differences

are

in

deciding

significant

on

whether
appellate

to

vary.

review,

And,
inter

the

alia,

because the standard of review for a departure is de novo, see
Pepper v. United States, 131 S. Ct. 1229, 1244 (2011), whereas
variances are reviewed for abuse of discretion.
Whitley’s argument finds further support in the Guidelines,
specifically Chapter One, Part B General Application Principles,
§ 1B1.1 Application Instructions, which provides:
(a)

The court shall determine the kinds of sentence and
the guideline range as set forth in the guidelines by
applying the provisions of this manual in the
following order, except as specifically directed:
[stating that the court shall determine the range as
set forth in §§ 1B1.1(a)(1)–(7) by applying Chapters
Two, Three, Four and Five, and then determine the
sentencing requirements and options (8).]

(b)

The court shall then consider Parts H and K of Chapter
Five,
Specific
Offender
Characteristics
and
Departures,
and
any
other
policy
statements
or
commentary in the guidelines that might warrant
consideration in imposing sentence. See 18 U.S.C. §
3553(a)(5).

2

A recent opinion of this Court, United States v. RiveraSantana, 668 F.3d 95 (4th Cir. 2012), has taken the same view.
Relying on Irizarry, the Court there explained that “[t]he terms
‘variance’ and ‘departure’ describe two distinct sentencing
options available to a sentencing court,” and described the
differences between the two sentencing options. Id. at 100 n.6.
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(c)

U.S.S.G.

Filed: 09/09/2013

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The court shall then consider the applicable factors
in 18 U.S.C. § 3553(a) taken as a whole. See 18 U.S.C.
§ 3553(a).
§

1B1.1

(Nov.

1,

2012)

(emphasis

added)

(hereafter

“§ 1B1.1”).
The Court, of course, is bound by the General Application
Principles
Guidelines.

and

the

Application

Notes

in

interpreting

the

United States v. Price, 711 F.3d 455, 458 (4th Cir.

2013) (citing United States v. Hudson, 272 F.3d 260, 263 (4th
Cir. 2001); United States v. Banks, 130 F.3d 621, 624 (4th Cir.
1997)).

That is so because even after the Guidelines were held

to be advisory, 3 they “continue to play an important role in the
sentencing process.” United States v. Dean, 604 F.3d 169, 173
(4th Cir. 2010). 4
Further, it is settled that “[t]he Sentencing Commission
promulgates the guidelines by virtue of an express congressional
delegation

of

authority

for

rulemaking,”

and

thus,

“the

guidelines are the equivalent of legislative rules adopted by
federal agencies.”

Stinson v. United States, 508 U.S. 36, 44-45

3

United States v. Booker, 543 U.S. 220, 234 (2005).
In Kimbrough v. United States, 552 U.S. 85, 101 (2007)
(relying on Gall), the Supreme Court directed that a sentencing
court must “give respectful consideration to the Guidelines,” as
required by 18 U.S.C. § 3553. See also Pepper v. United States,
___ U.S. ___, 131 S. Ct. 1229, 1247 (2011) (“Accordingly, we
have instructed that district courts must still give ‘respectful
consideration’
to
the
now-advisory
Guidelines
(and
their
accompanying policy statements).”).
4

24

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(1993).

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And, as this Court has put it: “[t]he [Sentencing]

Commission’s

interpretive

commentary

is

‘akin

to

an

agency’s

interpretation of its own legislative rules,’” and “is therefore
entitled to substantial deference.”
F.3d

555,

result,

559

(4th

Guidelines

Cir.

2002)

commentary

United States v. Mason, 284

(citations

that

omitted).

‘interprets

or

“As

a

explains

a

guideline is authoritative unless it violates the Constitution
or a federal statute, or is inconsistent with, or a plainly
erroneous reading of, that guideline.’”
508 U.S. at 38, 113 S. Ct. at 1915).
628

F.3d

669

(4th

Cir.

2010),

Id. (quoting Stinson,

In United States v. Hood,

well

after

Booker

made

the

Guidelines advisory, the Court, in deciding the meaning of crime
of violence, recognized the continuing force of Stinson. 5
The amendment that is reflected in § 1B1.1 was implemented
to help secure consistency in the application of the Guidelines
after

they

were

made

advisory

by

Booker.

As

the

majority

opinion explains, Diosdado-Star did not mention Irizarry or §
1B1.1 which took effect on November 1, 2010, almost three months
before Diosdado-Star was issued and slightly more than a month
before arguments were heard.

Also, the briefs in Diosdado-Star

5

In Hood, the Court observed that “[t]he Supreme Court has
long held that ‘commentary in the Guidelines Manual that
interprets or explains a guideline is authoritative unless it
violates
the
Constitution
or
a
federal
statute,
or
is
inconsistent with, or a plainly erroneous reading of, that
guideline.’” Id. at 672.
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were filed before the amendment took effect, and they do not
mention the amendment.
The Reason for Amendment section accompanying the amendment
to

§

1B1.1

points

out

that,

after

Booker,

most

circuits,

including this one, used the three-step approach specified in
the amendment and, indeed, cites United States v. Moreland, 437
F.3d 424, 433 (4th Cir. 2006), as support for that approach. The
same section articulated that “[a] ‘variance’ - i.e., a sentence
outside the guideline range other than as provided for in the
Guidelines Manual [a departure] - is considered by the court
only

after

(Effective

departures
Date:

have

been

1,

2010;

Nov.

considered.”
2011

WL

Amendment

5984683,

at

741

*1113

(emphasis added).
Hence, the sentencing catechism in effect at the time of
appellate

consideration

recognizes

that

there

are

significant

differences between “departures” and “variances,” and requires
that,

before

varying,

a

court

must

departure sentence is in order.

first

consider

whether

a

And, that logically means that

an adequate explanation of a non-Guideline sentence should state
whether the deviation from the Guidelines is by way of departure
or

by

way

available

of

variance.

ground

of

And,

departure

where,

as

identified

here,
in

there

the

is

PSR,

an
the

district court would have to address (and accept or reject) that
ground before imposing a variance sentence.
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B.
Thus, on appeal, the Court is confronted with Guideline
provisions that are at squarely odds with a published opinion
issued by the panel of this Court in Diosdado-Star.

At the same

time, Henderson necessitates application of the law in effect at
the time of appellate consideration.

If, as I understand to be

the rule, deference is owed to § 1B1.1, a regulation that has
the force of law, it would appear that this panel could not
follow Diosdado-Star to apply the law in effect at the time of
appellate consideration.
However,
“customarily

under
a

the

panel

principle

considers

of

itself

interpanel
bound

by

accord,

the

prior

decision of another panel, absent an in banc overruling or a
superseding contrary decision of the Supreme Court.”

Busby v.

Crown Supply, Inc., 896 F.2d 833, 840-41 (4th Cir. 1990); see
also Mentavlos v. Anderson, 249 F.3d 301, 312 n.4 (4th Cir.
2011) (“[A] panel of this court cannot overrule, explicitly or
implicitly, the precedent set by a prior panel of this court.
Only the Supreme Court or this court sitting en banc can do
that.”).
The

principle

inflexible.

of

interpanel

accord,

however,

is

not

For example, in Derflinger v. Ford Motor Co., 866

F.2d 107, 110 (4th Cir. 1989), the Court applied the principle
of interpanel accord, but noted that a previous panel decision
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would not be followed where there was a subsequent statutory
amendment

(there

a

subsequent

change

in

an

applicable

state

statute in a diversity case) that makes the previous decision
wrong.

In United States Dep’t of Health & Human Servs. v. Fed.

Labor Regulations Auth., 983 F.2d 578, 581-82 (4th Cir. 1992),
the Court explained that “[a] decision by a panel of this court,
or by the court sitting en banc does not bind subsequent panels
if the decision rests on authority that subsequently becomes
untenable.”

Id. (citing Busby, 896 F.2d at 840-41, and Faust v.

South Carolina State Highway Dep’t, 721 F.2d 934, 940 (4th Cir.
1983)).
There

are

no

decisions

in

this

circuit

that

involve

application of the interpanel accord principle to facts quite
like those presented here in which the change in law occurred
before the prior panel decision, but was not mentioned in the
panel opinion apparently because of the temporal relationship
between

the

change,

the

briefing,

and

the

panel

opinion.

However, in Moody Nat’l Bank v. GE Life & Annuity Assurance Co.,
383 F.3d 249, 252 (5th Cir. 2004), the Fifth Circuit faced an
issue quite similar to the one presented here.
In

Moody

Nat’l

Bank,

the

statutory

amendment

went

into

effect approximately two months before the release of the prior
panel
case.

decision

and

after

oral

argument

and

briefing

in

that

After explaining the circuit’s settled adherence to the
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rule of interpanel accord, the Fifth Circuit explained that the
rule that a panel is “bound to follow the prior panel rulings of
this court . . . is inapplicable, however, where Congress makes
a change in statutory law that directly affects a prior panel
opinion.”

Id.

panel]

not

did

Observing that “it is clear that [the prior
consider

the

amendments . . . or

the

relevant

comments thereto in reaching its decision,” id. at 253 n.5, the
Fifth

Circuit

amendment.
comments

decided

the

case

in

perspective

of

the

recent

That approach, of course, is consistent with the
in

Derflinger

and

with

the

“subsequently

becomes

untenable” rationale in Fed. Labor Regulations.
Of

course,

the

decisions

in

Derflinger

and

Fed.

Labor

Regulations must be viewed in perspective of the fact that the
Court, sitting en banc, has expressed a clear preference for
adherence to the rule of interpanel accord absent an intervening
opinion from this Court sitting en banc or the Supreme Court.
McMellon
However,

v.

United

McMellon

States,
did

not

387

F.3d

329

present

(4th

the

Cir.

rather

2004).
unusual

circumstances that are present here, circumstances that involve
the kind of approach that district courts must take respecting
the every-day judicial task of sentencing.

Nor, at the time of

McMellon, had Henderson been decided requiring that plain error
be judged at the time of appellate consideration.

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Nonetheless, as explained in United States v. White, 670
F.3d 419, 516 (4th Cir. 2012), it is the duty of the subsequent
panel to find an appropriate way to harmonize resolution of a
conflicting issue with a prior panel decision on that issue if
it

is

possible

possible

to

to

do

so.

Unfortunately,

harmonize

the

decision

in

the

Supreme

Court

it

is

not

really

Diosdado-Star

with

§

1B1.1.
Considering

that

and

this

Court’s

decisions, for example in Price and Hood, require substantial
deference to the Guidelines, and taking into account that there
is

no

Constitutional

or

other

infirmity

here

that

would

foreclose such deference, I would conclude that the sentencing
approach articulated in Diosdado-Star is no longer tenable and
that it was error not to proceed as § 1B1.1 requires.
The error was plain, if measured at the time of appellate
consideration,
created

by

even

the

considering

conflict

between

the
§

unsettled
1B1.1

and

circumstance
Diosdado-Star

because § 1B1.1 must be given substantial deference.
States v. Henderson, ___ U.S. ___, 113 S. Ct. 1130.
judges,

and

most

litigants,

likely

would

prefer

United
District

the

less-

structured, and quite sensible, approach reflected in DiosdadoStar.

But, as long as the Guidelines continue to be a part of

the approach to federal sentencing, and as long as they have the
force of law to which substantial deference is owed, it seems to
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me that § 1B1.1 must be applied as the law at the time of
appellate consideration.

For the foregoing reasons, I would

conclude

measured

that

the

error,

at

the

time

of

appellate

consideration, is plain.
However, Whitley does not satisfy the Olano test because
his substantial rights were not prejudiced by the approach taken
by

the

district

court.

That

is

so

because

talismanic

recitations of sentencing vernacular are never necessary and a
sentence is adequately explained if the Court can determine from
the

record

what

occurred

at

sentencing.

United

States

v.

Allmendinger, 706 F.3d 330, 343 (4th Cir. 2013); United States
v.

Carter,

564

F.3d

325,

328-30

(4th

Cir.

2009).

As

the

majority opinion makes clear, the record shows that the nonGuideline sentence imposed here was a variance, not a departure;
and,

as

the

adequately

majority

explained

concludes,

and

is

the

sentence

readily

amenable

waiver,

the

imposed
to

was

appellate

review.
Relying

on

a

finding

of

majority

finds

it

unnecessary to address the conflict between Diosdado-Star and §
1B1.1 because Whitley did not raise § 1B1.1 in his brief or at
oral argument and, in fact, purported, in his brief, to rely on
Diosdado-Star.

Both

of

those

points

are

correct,

but,

I

respectfully suggest that they do not warrant by-passing the
issue.

As

I

understand

it,

“[w]hen
31

an

issue

or

claim

is

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properly

Filed: 09/09/2013

before

the

court,

Pg: 32 of 32

the

court

is

not

limited

to

the

particular legal theories advanced by the parties, but rather
retains the independent power to identify and apply the proper
construction

of

governing

law.”

Kamen

v.

Kemper

Financial

Services, Inc., 500 U.S. 90, 99 (1991) (rejecting contention
that petitioner waived argument by failing to raise it until
reply brief)(citing Arcadia v. Ohio Power Co., 498 U.S. 73, 77
(1990)).

Further, an appellate court may consider an argument

“̒antecedent to . . . and ultimately dispositive of’ the dispute
before

it,

brief.”

even

an

issue

the

parties

fail

to

identify

and

U.S. Nat. Bank of Oregon v. Indep. Ins. Agents of Am.,

Inc., 508 U.S. 439, 445-46 (1993).

It seems to me that, in

substance, Whitley’s argument invokes the principles reflected
in

§

1B1.1.

And,

it

is

the

substance

of

an

argument

that

presents the issue even if the party making the argument fails
to cite the best authority in support of it.

Hence, I would

conclude that Whitley’s argument presents the issue that is the
conflict between § 1B1.1 and Diosdado-Star, even though he has
not cited § 1B1.1 and even though his brief pays lip service to
Diosdado-Star.

32