United States v. Armelinda Castillo

Case: 13-11007 Document: 00512950861 Page: 1 Date Filed: 02/26/2015

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 13-11007 United States Court of Appeals

Fifth Circuit

FILED

UNITED STATES OF AMERICA, February 26, 2015

Lyle W. Cayce

Plaintiff - Appellee Clerk

v.

ARMELINDA CASTILLO, also known as Irma Castillo,

Defendant - Appellant

Appeal from the United States District Court

for the Northern District of Texas

Before BENAVIDES, PRADO, and GRAVES, Circuit Judges.

FORTUNATO P. BENAVIDES, Circuit Judge:

This is a direct criminal appeal in which Appellant Armelinda

Castillo (“Castillo”) challenges only her sentence. Castillo contends that

the district court erred in failing to reduce her offense level for acceptance

of responsibility pursuant to U.S.S.G. § 3E1.1(b). We vacate her sentence

and remand the case to allow the district court to determine in the first

instance whether her challenge to the amount of funds stolen was made

in good faith.

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I. BACKGROUND

Castillo was employed by Westex Federal Credit Union (“WFCU”)

in Lubbock, Texas. Beginning in April of 2009 and continuing until April

2012, she embezzled cash from WFCU’s vault. Castillo pleaded guilty to

misapplication of bank funds in excess of $1,000 by a bank employee in

violation of 18 U.S.C. § 656.

Pursuant to U.S.S.G. § 2B1.1(a)(1)(A) & (B), the base offense level

was 7. The Presentence Report (“PSR”) provided that Castillo had stolen

$690,000, and thus added 14 levels because the amount of funds stolen

exceeded $400,000, but was less than $1,000,000. U.S.S.G.

§ 2B1.1(b)(1)(H). Pursuant to U.S.S.G. § 3E1.1(a), the PSR recommended

a two-level reduction for acceptance of responsibility based on Castillo’s

timely guilty plea that permitted the government to avoid preparing for

trial. PSR ¶ 28. The PSR further provided that at sentencing, the

“government will formally move the Court to grant the additional 1-level

reduction” for acceptance of responsibility pursuant to § 3E1.1(b). Id.

The government had no objections to the PSR. Castillo, however, filed

written objections, denying that she had confessed to taking $690,000.

Instead, she claimed that the “evidence only establishes by a

preponderance that the amount was greater than $70,000 but less than

$120,000.” Thus, she argued that the offense level should only be

increased by 8 levels pursuant to § 2B1.1(b)(1)(E).

On August 30, 2013, at the sentencing hearing, Castillo disputed

the government’s allegation that she had stolen $690,000, and called

witnesses to support her contention that she had stolen less than

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$120,000. 1 Castillo testified that although she was not sure exactly how

much money she had stolen, it was “nowhere near” $690,000. After the

district court found by preponderance of the evidence that the amount of

loss was $690,000, the government declined to move for the additional

one-level reduction in the offense level under § 3E1.1(b), stating that “it’s

the United States’ opinion that we have, in essence, been taken to the

task of trial. We have saved no effort, no judicial resources. We have

spent a day in court discussing the loss amount.” Castillo objected,

stating that she had accepted responsibility by pleading guilty and

willingly talking to the bank investigator and the police. Castillo claimed

that she took “responsibility for [the amount of money] she believe[d] she

actually took.” The district court expressly agreed with the government

and denied the additional, one-level reduction for acceptance of

responsibility under § 3E1.1(b).

At the time of Castillo’s sentencing, this Court had held that the

government’s decision to refuse to move for the additional reduction

under § 3E1.1(b) was reviewable on appeal only to determine whether

the refusal to so move was based on an unconstitutional motive or was

not reasonably related to a legitimate government end. United States v.

Newson, 515 F.3d 374, 378 (5th Cir. 2008), abrogated by United States v.

Palacios, 756 F.3d 325 (5th Cir. 2014) (per curiam). Additionally, this

Court had concluded that the defendant’s refusal to waive his appellate

rights was a proper basis for the government to refuse to move for an

1 The factual resume signed by both parties provides that Castillo misapplied and

embezzled bank funds in excess of $1,000.

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additional reduction in offense level because it was rationally related to

the purpose of § 3E1.1 and is not an unconstitutional motive. Id.

After Castillo had filed a notice of appeal, Amendment 775 to the

sentencing guidelines became effective on November 1, 2013. U.S.

Sentencing Guidelines Manual app. C, Amendment 775 (Nov. 1, 2013).

Amendment 775 resolved a circuit split regarding whether a defendant’s

refusal to waive his right to appeal was an interest identified in § 3E1.1

such that the government could rely on it to decline to move for the

offense-level reduction under § 3E1.1(b). Amendment 775 provides that

the “government should not withhold [a § 3E1.1(b)] motion based on

interests not identified in § 3E1.1, such as whether the defendant agrees

to waive his or her right to appeal.” In a footnote in its brief, the

government recognized the amendment, but asserted that it was

inapplicable because it became effective months after Castillo’s

sentencing. The government further argued that, even if it was a

clarifying (as opposed to substantive) amendment, it would not preclude

the government’s refusal to move for a reduction because the commentary

expressly discusses efficient allocation of resources by the government

and the court.

Subsequently, however, on February 27, 2014, the government filed

a Federal Rule of Appellate Procedure Rule 28(j) letter in this Court

noting that the Solicitor General had taken a contrary position before the

Supreme Court, conceding that Amendment 775 is a clarifying

amendment. Thus, Castillo is entitled to the benefit of the amendment

even though it was not in effect at the time of her sentencing. In the Rule

28(j) letter, the government nonetheless stated that Castillo’s sentence

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should be affirmed regardless of whether Amendment 775 is clarifying or

substantive. As the government points out, Castillo was not denied the

reduction because she refused to waive her appellate rights. Instead, the

government refused to move for the one-level reduction because her

objection to the amount of loss “required the government to prove the full

scope of her offense in a day-long hearing and evidenced a lack of

complete acceptance of responsibility for her offense.” Thus, the

government argues that the reason for the refusal was based on interests

identified in § 3E1.1, which is what is required by Amendment 775.

On May 21, 2014, this Court, relying on Amendment 775, issued an

opinion holding that the government cannot withhold a sentence

reduction for acceptance of responsibility based on the defendant’s

refusal to waive his right to appeal. Palacios, 756 F.3d at 326. In a

footnote, this Court explained that all active judges had assented to the

opinion and that the en banc Court therefore concluded that “Newson—

to the extent it may constrain us from applying Amendment 775 to cases

pending on direct appeal under our rule of orderliness—is abrogated in

light of Amendment 775.” Id. at 326 n.1. 2 We now turn to Castillo’s

challenge to the district court’s denial of a one-level reduction for

acceptance of responsibility pursuant to § 3E1.1(b).

2 On September 4, 2014, this Court directed counsel for both parties to file

supplemental letter briefs addressing the impact or effect of Palacios on the issue raised in

this appeal. The attorneys have filed their supplemental letter briefs, which are discussed

below.

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II. Denial of Additional Offense Level Reduction

for Acceptance of Responsibility, U.S.S.G. § 3E1.1(b)

Castillo contends that the district court erred in failing to reduce

her offense level under § 3E1.1(b). We review the district court’s legal

interpretation of the Sentencing Guidelines de novo and factual findings

for clear error. United States v. Murray, 648 F.3d 251, 254 (5th Cir.

2011). A factual finding is clearly erroneous only if, based on the entirety

of the evidence, the reviewing court is left with the definite and firm

conviction that a mistake has been made. United States v. Valdez, 453

F.3d 252, 262 (5th Cir. 2006).

Section 3E1.1(a) provides that if a “defendant clearly demonstrates

acceptance of responsibility for his offense, decrease the offense level by

2 levels.” Castillo received that two-level reduction and that reduction is

not before us on appeal. Section 3E1.1(b) provides that the offense level

may be reduced an additional level if the government moves for such a

reduction and represents that the defendant “has assisted authorities in

the investigation or prosecution of his own misconduct by timely

notifying authorities of his intention to enter a plea of guilty, thereby

permitting the government to avoid preparing for trial and permitting

the government and the court to allocate their resources efficiently.”

As previously set forth, the PSR recommended that Castillo’s

offense level be reduced pursuant to both subsections 3E.1.1(a) and (b).

The PSR also provided that the prosecutor had represented that “[a]t the

time of sentencing, the government will formally move the Court to grant

the additional 1-level reduction.” PSR ¶ 28. The government filed a

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statement with the court that it had no objections to the PSR and that it

“hereby adopt[ed] it.” 3 However, Castillo filed objections to the PSR

(including the instant objection to the amount of funds stolen) and

requested the court to permit introduction of evidence on the objections.

At the sentencing hearing, the government refused to move for the

additional, one-level reduction under § 3E1.1(b) because Castillo had

contested the amount of funds listed in the PSR.4 Castillo objected,

stating that she took responsibility for the amount of funds she believed

that she had actually stolen. The district court agreed with the

government and denied the additional, one-level reduction for acceptance

of responsibility under § 3E1.1(b).

Castillo contends that it was error to deny her the one-level

reduction based on her challenging the amount of funds attributed to her

offense conduct at the sentencing hearing. Both parties recognize that

Amendment 775 applies to the instant appeal. See Palacios, 756 F.3d at

326. In part, Amendment 775 provides: “The government should not

withhold such a motion based on interests not identified in § 3E1.1, such

as whether the defendant agrees to waive his or her right to appeal.”

Accord U.S.S.G. § 3E1.1 cmt. n.6. Both parties also agree that the

determinative question is whether Castillo’s contesting the amount of

stolen funds implicated an interest identified in § 3E1.1. However, the

government and Castillo disagree with respect to whether the interest

3Section 3E1.1 was not mentioned in the plea agreement.

4 Indeed, the government argued that “perhaps even acceptance of responsibility of

the other 2 points . . . should not be given at this time.” See § 3E1.1(a). However, the district

court accepted the PSR’s recommendation to grant the two-level reduction, and the

government has not appealed that ruling.

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must be identified only in subsection (b) of § 3E1.1. More specifically, the

government contends that it may rely on interests identified in either

subsections (a) and (b) of § 3E1.1 to withhold a motion for a reduction

under § 3E1.1(b). In contrast, Castillo argues that the government may

only rely upon interests identified in subsection (b) of § 3E1.1. Therefore,

we first address the threshold question whether the government may

consider factors in § 3E1.1(a) in withholding a motion under § 3E1.1(b).

Castillo argues that “[n]o legitimate argument can be made for why

contesting the loss amount at a sentencing hearing is distinguishable

from a failure to waive the right to appeal, which Amendment 775

exemplifies as an interest that is not within those interest[s] identified

in § 3E1.1(b).” Supp. Letter Br. 2. Castillo relies on this Court’s opinion

in United States v. Tello, 9 F.3d 1119 (5th Cir. 1993). In that case, the

district court refused the additional one-level reduction because Tello had

committed obstruction of justice by lying to the probation officer about

his criminal history. Id. at 1121. Construing a prior version of the

Application Note, this Court held that the sentencing court was limited

to the considerations set forth in § 3E1.1(b) in determining whether to

grant the additional, one-level reduction for acceptance of responsibility.

Id. at 1128–29. More specifically, the considerations were whether

Tello’s lying to the probation officer (1) caused the government to prepare

for trial, or (2) interfered with the court’s efficient management of its own

schedule. Id. at 1123–24, 1125–26. This Court determined that Tello’s

lying implicated neither of those two concerns, and thus, even though

Tello’s lying caused the probation officer to spend more time on the

investigation for the PSR, we rejected that as a proper basis for denying

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the additional one-level reduction under § 3E1.1(b). Accordingly, in Tello,

we held that the “sentencing court is limited to the considerations in

§ 3E1.1(b) to determine whether to grant the reduction.” United States

v. Williamson, 598 F.3d 227, 230 n.3 (5th Cir. 2010).

However, as previously set forth, in 2013, twenty years after Tello,

the Sentencing Commission issued Amendment 775, which is “codified”

in the commentary to § 3E1.1. See § 3E1.1 cmt. n.6. The government

argues that this guideline commentary allows it to consider interests

identified in § 3E1.1 generally and does not restrict the government to

identifying interests only in § 3E1.1(b). 5 We agree. The amended

commentary instructs that the “government should not withhold such a

motion based on interests not identified in § 3E1.1, such as whether the

defendant agrees to waive his or her right to appeal.” § 3E1.1 cmt. n.6.

The plain language of the commentary thus allows the government to

refuse to file a § 3E1.1(b) motion based on an interest that is identified

in § 3E1.1, without regard to which subsection contains the interest. The

commentary does not prohibit the government from identifying an

interest in § 3E1.1(a) and relying on that interest as a basis to refuse to

5 The government also contends that Castillo’s heavy reliance on Tello is misplaced

because it involved a former version of § 3E1.1(b), and, unlike the version in Tello, the current

version requires a government motion as a prerequisite to the court’s granting the additional

reduction. Although the current version does require a motion to be made by the government,

that requirement is of no moment here because the issue is whether the government refused

to make such a motion on an impermissible basis. See Palacios, 756 F.3d at 326 (holding that

the government’s refusal to file a motion for the one-level reduction based on interests not

identified with § 3E1.1(b) was error that required resentencing). The key difference between

the provision Tello construed and the amended guidelines is the instruction that the

government may not withhold a motion based on “interests not identified in § 3E1.1.” § 3E1.1

cmt. n.6. This is the provision we construe here today—a provision absent from the prior

version of the commentary.

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file a § 3E1.1(b) motion. Sentencing guideline commentary is binding and

is “equivalent in force to the guideline language itself, as long as the

language and the commentary are not inconsistent.” United States v.

Rayo-Valdez, 302 F.3d 314, 318 n.5 (5th Cir. 2002). Thus, we conclude

that the government may withhold a § 3E1.1(b) motion based on an

interest identified in either subsection (a) or (b) of § 3E1.1. 6

6 We note that the partial dissent states that “we are constrained by Tello’s explicit

holding that a post-plea, sentencing objection is simply not a valid basis to deny a § 3E1.1(b)

reduction.” Dissenting Op. at 4. As previously set forth, in Tello, this Court held that the

sentencing court was limited to the considerations set forth in § 3E1.1(b) in determining

whether to grant the additional, one-level reduction for acceptance of responsibility.”

Majority Op., supra, at 8. However, Tello is not controlling on this point because the

Sentencing Commission subsequently amended the guideline commentary to allow the

government to refuse to file a § 3E1.1(b) motion based on interests identified under either

subsections (a) or (b) of 3E1.1. Id. at 9–10.

The partial dissent argues that because a reduction under § 3E1.1(a) is a prerequisite

for the government’s motion under § 3E1.1(b), the defendant’s acceptance of responsibility

under (a) is a settled matter by the time the government is debating whether to move for an

additional reduction under (b). Therefore, the argument goes, the factors indicating

acceptance of responsibility under (a)—such as those articulated in Application Note 1 to the

guideline—are only for the court, and not for the government, to consider. However, this

argument runs against the plain text of Application Note 6, which only restricts the

government from relying on “interests not identified in § 3E1.1” without mentioning a

subsection. Had the Sentencing Commission intended to restrict the government’s discretion

to factors identified in subsection (b), it could have spoken with greater specificity—as it did

in Application Notes 1, 3 and even parts of 6, as well as in the commentary to other guidelines.

Moreover, the PROTECT Act, which amended § 3E1.1, was designed to safeguard the

government’s discretion whether to move for the reduction, and the court’s discretion whether

to grant it. See U.S.S.G. supp. to app. C, amend. 775, at p. 46 (2013) (citing U.S.S.G. § 3E1.1

cmt. n. 6 (the third level of reduction “may only be granted” upon a formal motion by the

government); H.R. Rep. No. 106–66, at 59 (2003) (Conf. Rep.) (stating that the PROTECT Act

amendment would “only allow courts to grant an additional third point reduction for

‘acceptance of responsibility’ upon motion of the government”)). The PROTECT Act went so

far as to expressly invalidate any future Sentencing Commission commentary that might

curtail the government’s discretion. See Pub. L. No. 108-21, §§ 401(g) (amending § 3E1.1(b)

and Note 6), 401(j) (“At no time may the Commission promulgate any amendment that would

alter or repeal the amendments made by subsection (g) of this section.”). A broad reading of

Amendment 775 bolsters both actors’ discretion. By contrast, a narrow reading risks making

the motion virtually compulsory when the defendant timely pleads guilty, contrary to one of

the expressed purposes of the PROTECT Act.

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We turn next to whether Castillo’s objection to the PSR’s drug-

quantity determination implicated an “interest identified in § 3E1.1.”

With respect to § 3E1.1(b), the government argues that one of the

identified interests is the preservation of governmental and judicial

resources when a defendant foregoes litigation and thus, Castillo’s

challenge to the relevant conduct at the sentencing hearing was a

permissible reason to refuse to file a § 3E1.1(b) motion. The current

version of § 3E1.1(b) added the following italicized language: “thereby

permitting the government to avoid preparing for trial and permitting

the government and the court to allocate their resources efficiently.”

Accordingly, although the current version of the guideline refers to

efficient allocation of governmental resources, it does so only in the

context of preparing for trial. Moreover, the commentary to § 3E1.1

refers only to the government’s being able to “avoid preparing for trial.”

§ 3E1.1 cmt. n.6. The commentary makes no reference to the government

preparing for a sentencing hearing. Therefore, we disagree that the

government may withhold a § 3E1.1(b) motion simply because it has had

to use its resources to litigate a sentencing issue.

Additionally, there are two out-of-circuit opinions that reject the

government’s argument in the context of determining that a defendant’s

refusal to waive his appeal was not a proper basis to deny a § 3E1.1(b)

reduction. As previously set forth, we have held that the government

may not withhold a § 3E1.1(b) motion based on a defendant’s refusal to

waive his appeal. Palacios, 756 F.3d at 326. Nonetheless, we look to

these two opinions because we find their analyses applicable to the

instant issue. In Amendment 775, the Sentencing Commission referred

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to these two opinions, stating the opinions were consistent with its

conclusion that the refusal to waive an appeal is an interest not identified

in § 3E1.1. In the first opinion, the Fourth Circuit recognized that the

guideline identified resource allocation and trial avoidance as interests

and explained that the syntax of § 3E1.1(b) demonstrates that those

interests must only be furthered by timely notifying the authorities that

he intends to plead guilty. United States v. Divens, 650 F.3d 343, 348

(4th Cir. 2011). More specifically, the Court explained that the phrase

that mentioned resource allocation and trial avoidance referred back to

the requirement that the defendant timely notify authorities of his intent

to plead guilty. Id. The second opinion was a concurring opinion written

by Judge Rovner of the Seventh Circuit. United States v. Davis, 714 F.3d

474, 476 (7th Cir. 2013) (Rovner, J., concurring). In his concurring

opinion, Judge Rovner stated that § 3E1.1 and its “commentary focus

explicitly and exclusively on avoiding the need to prepare for trial (and

clearing the district court’s trial calendar). No proceeding or event that

might occur later is mentioned or even hinted at.” Id. at 479. Thus, like

the Fourth Circuit, Judge Rovner concluded that a defendant waiving his

right to appeal was not identified as an interest implicating the

preservation of governmental or judicial resources as set forth in

§ 3E1.1(b).

Moreover, the Second Circuit rejected the government’s argument

in the context of a defendant’s challenging factual findings in the PSR,

which is indistinguishable from the instant case. Relying on the Fourth

Circuit’s opinion in Divens, the Second Circuit opined that it was equally

impermissible for the government to refuse to move for the § 3E1.1(b)

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reduction based on either (1) a defendant’s challenge to a factual finding

in the PSR or (2) a defendant’s refusal to waive his right to appeal.

United States v. Lee, 653 F.3d 170, 173–75 (2d Cir. 2011). More

specifically, in Lee, the government refused to move for the reduction

because it had to prepare for a hearing to respond to a defendant’s

challenge to a factual finding in the PSR that the defendant had

threatened to kill certain drug couriers. Id. at 173. The Second Circuit

reasoned that the “plain language of § 3E1.1(b) refers only to the

prosecution resources saved when the defendant’s timely guilty plea

‘permit[s] the government to avoid preparing for trial.’” Id. at 174

(alteration and emphasis in original). The court stated that while the

defendant challenged certain findings in the PSR and requested a

hearing, it was undisputed that his plea of guilty was timely and that the

government did not have to prepare for trial. Id. Thus, the language in

§ 3E1.1(b) did not justify the government’s refusal to move for the

reduction. Id. Likewise, the commentary to § 3E1.1 “refer[s] only to the

government’s ability ‘to determine whether the defendant has assisted

authorities in a manner that avoids preparing for trial.’” Id. (quoting

§ 3E1.1 cmt. n. 6) (emphasis in original). The Second Circuit further

opined that a defendant has a due process right to challenge errors in the

PSR that affect his sentence. Id. Thus, according to the Second Circuit,

if the defendant has a good faith dispute as to the accuracy of the factual

findings in the PSR, it is impermissible for the government to refuse to

move for a reduction simply because the defendant requests a hearing to

litigate the objection. Id.

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The Sentencing Commission expressly recognized the Second

Circuit’s reasoning in Lee. As previously set forth, Amendment 775

followed the Fourth Circuit’s holding in Divens, that a defendant’s refusal

to waive his right to appeal is not a reason identified in § 3E1.1. 650 F.3d

at 348. Amendment 775 also stated that the Second Circuit had opined

that the “Fourth Circuit’s reasoning in Divens applies ‘with equal force’

to the defendant’s request for an evidentiary hearing on sentencing

issues.” Amendment 775 at 45 (quoting Lee, 653 F.3d at 175). We

interpret Amendment 775’s citing of the holding in Lee as implicitly

endorsing it. Because the Second Circuit relies on the plain language of

the guideline and its commentary, and the Sentencing Commission

favorably cited that holding, we are persuaded to follow its analysis.

More specifically, we hold that if the defendant has a good faith dispute

as to the accuracy of the factual findings in the PSR, it is impermissible

for the government to refuse to move for a reduction under § 3E1.1(b)

simply because the defendant requests a hearing to litigate the dispute.

Both this conclusion and its converse find additional support in the text

of § 3E1.1. Specifically, the guideline commentary provides that “a

defendant who falsely denies, or frivolously contests, relevant conduct

that the court determines to be true has acted in a manner inconsistent

with acceptance of responsibility. § 3E1.1 cmt. n.1(A).

It is not clear that Castillo has shown that the government’s refusal

to file a § 3E1.1(b) motion is impermissible under the circumstances of

this case. As set forth above, we hold that it is impermissible for the

government to refuse to move for a reduction if the defendant has a good

faith dispute. Here, the government argues that Castillo’s challenge to

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the amount of loss was apparently “insincere and certainly unnecessary,

as the evidence readily supported the PSR’s figure and Castillo had

admitted that loss amount no less than three times to a detective and

additionally to at least one other person.” Supp. Letter Br. 5 (emphasis

in original). In other words, the government is arguing that Castillo’s

challenge to the amount of money stolen was not made in good faith.

Thus, the government contends that Castillo has failed to fully accept

responsibility for her offense, which is an interest identified in § 3E1.1(a)

and its commentary.

As the government points out, the record demonstrates that

Castillo had admitted several times that she had stolen $690,000.7 This

Court, however, is not a fact-finder. Accordingly, we vacate the sentence

and remand to allow the district court to determine in the first instance

whether Castillo’s challenge to the amount of funds stolen was made in

good faith. If the district court determines that her challenge to the

amount of funds was not made in good faith, then it was not error for the

government to refuse to move for the additional one-level reduction under

§ 3E1.1(b). On the other hand, if the court determines that Castillo’s

challenge to the amount of stolen funds was made in good faith, then her

challenge does not constitute a permissible basis for refusing to move for

the reduction.

Alternatively, the government argues that even if it erred in

refusing to move for the reduction, the district court expressly agreed

7 At the sentencing hearing, Castillo admitted that she had told an investigator that

she believed she had embezzled about $690,000. A detective testified that Castillo told him

on at least three occasions that she stole $690,000.

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with the government, and thus, the court would not have granted Castillo

the reduction. Therefore, the government argues that any error was

harmless. This argument is without merit. If the government’s reason

for refusing to move for a reduction in Castillo’s offense level was

impermissible, the district court’s agreement with the government’s

position does not render the error harmless. This Court’s precedent

provides:

[A] sentencing error may not be found harmless unless the

proponent of the sentence proffer[s] sufficient evidence to

convince the appellate court that the district court would have

imposed the same sentence, absent the error. To satisfy that

burden, the proponent must point to evidence in the record

that will convince us that the district court had a particular

sentence in mind and would have imposed it, notwithstanding

the error.

United States v. Ibarra-Luna, 628 F.3d 712, 718 (5th Cir. 2010) (second

alteration in original) (internal quotation marks and footnotes omitted).

Here, without the additional one-level reduction for acceptance of

responsibility under § 3E1.1(b), Castillo’s offense level was 19 with a

criminal history category of I, which provides a sentencing guideline

range of 30-37 months of imprisonment. With the reduction, the offense

level would have been 18, which provides a range of 27-33 months of

imprisonment. The district court sentenced Castillo to 37 months, the

top of the higher guideline range, and thus, but for the alleged error, the

sentence imposed by the court was not within the applicable guideline

range. The government points to no evidence in the record that

demonstrates that the district court would have imposed the same

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sentence absent the error. Accordingly, the government has not shown

that the alleged error was harmless.

III. CONCLUSION

For the above reasons, Castillo’s sentence is VACATED, and the

matter is REMANDED to the district court for proceedings not

inconsistent with this opinion.

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JAMES E. GRAVES, JR., Circuit Judge, concurring in part and

dissenting in part:

I agree substantially with the factual summary and legal analysis in the

majority opinion. I, therefore, concur in part with the conclusion to vacate

Castillo’s sentence. However, I dissent in part from the conclusion to remand

for a determination of whether Castillo’s sentencing objection was made in

good faith. In my view, a post-plea, sentencing objection is simply not a valid

basis upon which the government may withhold a § 3E1.1(b) motion. Thus, I

conclude that Castillo is undeniably entitled to the § 3E1.1(b) reduction and

the remand should be for resentencing.

Section 3E1.1(b) states the following:

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 upon motion of the

government stating that the defendant has assisted authorities

in the investigation or prosecution of his own misconduct by

timely notifying authorities of his intention to enter a plea of

guilty, thereby permitting the government to avoid preparing

for trial and permitting the government and the court to

allocate their resources efficiently, decrease the offense level by

1 additional level.

U.S.S.G. § 3E1.1(b) (emphasis added). Therefore, the plain language of the

guideline indicates that if a defendant has a sufficiently high offense level and

has received a decrease under subsection (a), she should also receive a

reduction under subsection (b), if she has entered a timely guilty plea. Indeed

that was the conclusion of this court in United States v. Tello, 9 F.3d 119 (5th

Cir. 1993). In Tello, we held that a post-plea, post-conviction objection is not a

proper basis to deny a § 3E1.1(b) reduction because it in no way requires the

government to prepare for trial. Id. at 1125–27. We explained that “the core

purpose of subsection (b) . . . is not . . . concerned at all with when the defendant

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begins to serve h[er] sentence; it is concerned with when there is certainty that–

sooner or later–the defendant will be punished.” Id. at 1126.

Despite our precedent indicating that the focus of the § 3E1.1(b)

reduction is on the timely entry of a guilty plea, in United States v. Newson,

515 F.3d 374 (5th Cir. 2008), this court held that a defendant’s refusal to waive

her right to appeal was a permissible basis upon which the government could

refuse to move under § 3E1.1(b). The Fourth Circuit disagreed with us in

United States v. Divens, 650 F.3d 343 (4th Cir. 2011), and emphasized that the

government’s discretion in choosing whether to move under § 3E1.1(b) was

limited to a determination of whether the defendant entered a timely plea of

guilty. Id. at 346–48 (“Section 3E1.1(b) thus instructs the Government to

determine simply whether the defendant has ‘timely’ entered a ‘plea of guilty’

and thus furthered the guideline’s purposes in that manner. It does not permit

the Government to withhold a motion for a one-level reduction because the

defendant has declined to perform some other act to assist the Government.”).

The Second Circuit agreed with the Fourth Circuit in United States v. Lee, 653

F.3d 170 (2d Cir. 2011). The Second Circuit explained that the Fourth Circuit’s

observations that the government’s discretion was limited to considerations

surrounding guilty pleas “appl[ied] with equal force” to its holding that a post-

plea, sentencing objection was an invalid basis for the denial of a § 3E1.1(b)

reduction. Id. at 174–75.

Following the filing of Castillo’s appeal, Amendment 775 to the

Sentencing Guidelines became effective. Amendment 775 noted approval of

Divens and implicitly indicated disapproval of Newson. See U.S.S.G., supp. to

app. C, amend. 775, at pp. 43–46 (2013); accord U.S.S.G. § 3E1.1 cmt. n.6. The

amendment clarified § 3E1.1(b) by adding an additional sentence stating,

“[t]he government should not withhold such a motion based on interests not

identified in § 3E1.1, such as whether the defendant agrees to waive his or her

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right to appeal.” Id. Accordingly, in United States v. Palacios, 756 F.3d 325

(5th Cir. 2014), we recognized that the government could not withhold a

§ 3E1.1(b) motion due to the defendant’s failure to waive her appellate rights.

Id.

Clearly, the focus of a § 3E1.1(b) reduction motion is the timely entry of

a guilty plea. Therefore, a sentencing objection is an impermissible basis for

denying the additional reduction. The analysis should end there. But the

majority adds the requirement that a defendant demonstrate that her post-

plea sentencing objection is made in “good faith” in order to receive the

reduction. Apparently, the majority reads the Second Circuit’s decision in Lee

to state that the plain language of § 3E1.1(b) disallows the denial of a

§ 3E1.1(b) reduction on the basis of a post-plea, sentencing objection, so long

as that objection is made in good faith. The majority also “interpret[s]

Amendment 775’s citing of the holding in Lee as implicitly endorsing” a good

faith requirement. I disagree.

To the extent that we are to consider the Second Circuit’s opinion in Lee,

I am not convinced that it institutes a good faith requirement. Notably, the

court in that case adopted the plain language ruling of the Fourth Circuit in

Divens. 8 See Lee, 653 F.3d at 175 (stating that the observations of the Fourth

Circuit, that § 3E1.1(b) instructs the government to determine simply whether

8While the Lee court does mention a good faith requirement, it is most properly read

as involving only that court’s conclusion that the government’s refusal to move for an

additional level of reduction due to a post-plea, sentencing objection was an unconstitutional

violation of due process. See id. at 174 (“[A] defendant . . . has a due process right to

reasonably contest errors in the PSR that affect his sentence. . . . A defendant should not be

punished for doing so. If there is a good faith dispute as to the accuracy of factual assertions

in the PSR, the defendant’s request that the dispute be resolved is not a permissible reason

for the government to refuse to make the § 3E1.1(b) motion[.]”). Because the Lee court

provided three reasons for why the government’s refusal to move was unlawful, the first of

which being the plain language interpretation adopted from Divens, we have no reason to

reach the constitutional question in the case at hand and therefore, no reason to insert a good

faith requirement.

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the defendant’s guilty plea was timely, applied with “equal force”).

Furthermore, in Lee, the Second Circuit did not remand for a determination of

good faith but instead remanded for resentencing. Id. This was in spite of

Lee’s challenge to the PSR’s findings, which the district court found to be

without merit. See id. at 172. And insofar as Amendment 775 endorses the

Second Circuit’s conclusions in Lee, it did not include a good faith requirement

in its characterization of Lee’s holding. U.S.S.G., supp. to app. C, amend. 775,

at pp. 43–46 (2013) (“The Second Circuit, stating that the Fourth Circuit’s

reasoning in Divens applies ‘with equal force’ to the defendant’s request for an

evidentiary hearing on sentencing issues, held that the government may not

withhold a § 3E1.1(b) motion based upon such a request.”). Moreover, we are

constrained by Tello’s explicit holding that a post-plea, sentencing objection is

simply not a valid basis to deny a § 3E1.1(b) reduction.

It further appears that the majority justifies its insertion of a good faith

requirement on a notion that good faith is a consideration under subsection (a)

and the government may consider factors under subsection (a) in deciding

whether to move under subsection (b). The majority reaches this conclusion

due to language added to the § 3E1.1(b) commentary by Amendment 775 that

states, “The government should not withhold such a motion based on interests

not identified in § 3E1.1, such as whether the defendant agrees to waive his or

her right to appeal.” U.S.S.G. § 3E1.1 cmt. n.6. The majority agrees with the

government that because the Sentencing Commission did not specify that the

motion should be based on interests identified in § 3E1.1(b) but instead stated

it should be based on interests identified in § 3E1.1 (as a whole), the

government is allowed to revisit its considerations in subsection (a) when

deciding whether to move under subsection (b). This conclusion is contrary to

a common sense reading of the guideline.

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In order for the government to move under § 3E1.1(b), the court must

have first determined that a reduction is warranted under § 3E1.1(a). See

U.S.S.G. § 3E1.1(b) (“If the defendant qualifies for a decrease under subsection

(a), . . . decrease the offense level by 1 additional level.”) (emphasis added).

Therefore, even if it were proper for the government to consider all of the

considerations under § 3E1.1(a) before moving under § 3E1.1(b), by the time

the government is considering a motion under subsection (b), those factors

have already been considered in favor of the defendant. To read § 3E1.1(b) as

allowing the government to negate findings under § 3E1.1(a) would lead to

internally inconsistent results, i.e. a § 3E1.1(b) reduction being withheld

because the factors for § 3E1.1(a) were not met, although the defendant

received a § 3E1.1(a) reduction. Therefore, it is illogical, in my view, to derive

a good faith requirement under § 3E1.1(b) by revisiting the factors considered

under subsection (a).

Furthermore, as Castillo points out, if the government is allowed to

revisit the factors under subsection (a) when deciding whether to move under

subsection (b) then there would be no legitimate reason for the Sentencing

Commission to declare that a failure to waive the right to appeal is an invalid

basis upon which to withhold the motion. Under the majority’s reasoning, one

could argue that a defendant would need to have a “good faith” basis for not

waiving her right to appeal in order to be entitled to the reduction. Yet, such

a requirement was not inserted by the Sentencing Commission.

Thus, for the reasons outlined, I dissent from the reasoning in the

majority opinion that leads it to reach a conclusion to remand for a

determination of good faith. We should simply follow the clear language of the

guideline and hold that the government may only consider trial preparation in

deciding whether or not to move under subsection (b). In all other respects I

concur.

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