United States v. Carlo Castro

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_____________

No. 11-3893

_____________

UNITED STATES OF AMERICA

v.

CARLO DANIEL CASTRO,

Appellant.

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On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. No. 10-cr-732)

District Judge: Hon. Harvey Bartle, III

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Argued

September 25, 2012

Before: McKEE, Chief Judge, JORDAN, and VANASKIE,

Circuit Judges.

(Filed: January 8, 2013)

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Peter Goldberger [ARGUED]

50 Rittenhouse Place

Ardmore, PA 19003

Counsel for Appellant

Louis D. Lappen [ARGUED]

Office of United States Attorney

615 Chestnut Street - #1250

Philadelphia, PA 19106

Counsel for Appellee

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OPINION OF THE COURT

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JORDAN, Circuit Judge.

Daniel Castro, a high-ranking official in the

Philadelphia Police Department, was indicted in connection

with three separate schemes to extort money from separate

individuals by use of violence. He was convicted by a jury on

one count of making a material false statement to federal

agents in violation of 18 U.S.C. § 1001, and acquitted on one

count of conspiracy to commit extortion in violation of 18

U.S.C. § 894. The jury hung on the remaining eight counts.

To avoid a retrial, Castro pled guilty to a count of

conspiracy to commit extortion in violation of 18 U.S.C.

§ 1951. In exchange the government agreed to dismiss the

remaining charges against him. Castro‟s plea agreement

contained an appellate waiver provision under which, subject

to some exceptions, he “voluntarily and expressly waive[d]

all rights to appeal or collaterally attack” his “conviction,

2

sentence, or any other matter relating to this prosecution.”

(App. at 127.) The District Court sentenced him to

concurrent sentences of 18 months in prison for his

conviction for false statements and 60 months in prison for

his conviction by guilty plea for conspiracy to commit

extortion.

In this appeal, Castro challenges three facets of his

conviction and sentence. First, he contends that there was

insufficient evidence to convict him of making a false

statement to the FBI about money allegedly received from an

extortion victim. He argues that, because the money in

question came from the FBI in the course of a sting operation,

he told the literal truth when he denied having received any

money from the alleged victim. Second, Castro challenges

the District Court‟s authority to deny the government‟s

motion, made pursuant to § 3E1.1(b) of the United States

Sentencing Guidelines, for a one level decrease in his offense

level calculated under the guidelines. Third, Castro maintains

that, in arriving at a sentence that was 19 months higher than

the top of the range recommended by the guidelines, the

District Court failed to adequately account for his record of

good works. The government responds that Castro‟s first two

arguments are barred by his appellate waiver and that, as to

the third argument, Castro cannot show that the sentence is

unreasonable.

We conclude that the appellate waiver encompasses

both Castro‟s challenge to the sufficiency of the evidence and

his claim that the District Court lacked authority to deny the

government‟s motion for a one level decrease in his offense

level. However, while the waiver properly applies to prevent

our considering the District Court‟s refusal to award the

3

requested downward departure, we conclude that application

of the waiver against the sufficiency-of-the-evidence

argument would, in the unusual circumstances of this case,

work a miscarriage of justice. We will therefore vacate

Castro‟s conviction and 18-month sentence for making a false

statement to federal agents. We will also vacate Castro‟s 60-

month sentence because the invalid conviction for false

statements was included in calculating Castro‟s overall

offense level, causing that level to be higher than it otherwise

would have been and resulting in a sentencing range that is no

longer applicable. We are accordingly not in a position to

evaluate Castro‟s reasonableness challenge, and we will

remand the case to the District Court for resentencing solely

on the conviction for conspiracy to commit extortion.

I. Background

A. Facts

Castro rose from challenging circumstances to become

one of the highest ranking officers in the Philadelphia Police

Department. During his 25 years of service as a policeman,

he received numerous accolades and advancements, only a

handful of which we mention here. In 1997, he was promoted

to Captain. In 2001, he was nominated by the then-Mayor of

Philadelphia, Edward Rendell, and Police Commissioner John

Timoney to represent the Philadelphia Police Department as

an Eisenhower Fellow, an important position that placed

Castro in contact with community leaders from business,

academia, and political and non-profit organizations, and

allowed him to be part of international leadership mentoring

programs. And in 2010, he was promoted to the position of

Inspector, a high-ranking position within the police force. By

4

all accounts, Castro was well regarded within the Philadelphia

Police Department, and, as noted below, he saw himself as a

viable candidate to one day become police commissioner.

His successes and substantial authority make his subsequent

criminal behavior all the more disturbing and damning.

In 2006, Castro invested $90,000 in a residential real

estate development project organized by an acquaintance

named Wilson Encarnacion. When the project failed, Castro

repeatedly and unsuccessfully sought repayment from

Encarnacion. The lost investment represented Castro‟s life

savings.

In 2010, Castro discussed with another acquaintance,

Rony Moshe, his frustration over the personally disastrous

investment. Moshe mentioned that he knew a couple of tough

debt collectors, and Castro asked if Moshe could engage the

collectors to pressure Encarnacion to repay Castro‟s losses –

losses that Castro evidently thought of as a debt Encarnacion

owed him. Unbeknownst to Castro, Moshe was an FBI

informant. He reported his conversation with Castro to the

FBI, and an investigation was launched. At the FBI‟s behest,

Moshe began secretly recording telephone conversations and

in-person meetings with Castro. The undercover operation

ran from April through November of 2010.

On April 7, 2010, Moshe told Castro in a series of

recorded telephone calls that he had found a “collector” for

Castro who was willing to collect the $90,000 debt from

Encarnacion. Although Castro‟s loss on the failed investment

was $90,000, he instructed Moshe to have the collector

demand $150,000. When Moshe told Castro that the collector

would use threatening and intimidating collection methods,

5

Castro responded that he did not want to know the specific

methods, that he did not want to meet the collector, and that

he did not want the collector to know Castro‟s identity.

Castro emphasized that he did not want to get “implicated

into this.” (App. at 1291.) But he went ahead and provided

Moshe with Encarnacion‟s home address, and he told Moshe

to send the collector there because Encarnacion‟s wife and

child would be there and “they‟ll get scared.” (App. at 346.)

Later, on June 4, Castro spoke by telephone with an

undercover FBI agent posing as the collector. In that

conversation, which was recorded, the agent told Castro that

he and an associate had obtained $5,000 from Encarnacion

and had $4,500 to give to Castro, with $500 being withheld as

a collection fee. The agent represented that Encarnacion had

initially denied owing Castro any money but relented after the

agent and his associate went inside Encarnacion‟s house and

the agent threatened Encarnacion by telling him that he would

“f--- his wife” if he refused to pay. (App. at 1321-23.)

On June 11, Castro met with Moshe, who gave Castro

the $4,500 supposedly collected from Encarnacion. Moshe

said that, following Encarnacion‟s encounter with the

collector, Encarnacion was “scared to death.” (App. at 3691.)

Castro replied, “Good, Good, Good.” (App. at 361.) Castro

acknowledged that the collector “mean[t] serious business,”

and he mentioned that he was concerned that Encarnacion

might go to the police. (App. at 1332-33, 360-62.)

Castro met with Moshe again on July 20, 2010, and

Moshe gave him another $2,100 that the collector had

supposedly obtained from Encarnacion. That money, like the

first payment, came from the FBI. There is no evidence that

6

Encarnacion was aware of the FBI‟s payments to Castro or

that the FBI‟s payments somehow reduced a debt actually

owed by Encarnacion. Moshe stated that if Castro wanted to

recover his money more quickly, the collector would have to

become “more aggressive.” (App. at 377.) Castro was

hesitant to authorize more aggressive tactics, telling Moshe,

“I can‟t get myself in trouble. … I want to be Police

Commissioner.” (App. at 564.) Nevertheless, Castro urged

Moshe to have the collector go back to Encarnacion‟s home

and collect more money – “$10,000 at a shot.” (App at 384.)

Around that time, the undercover operation paused for

nearly two months because Moshe suffered a stroke. In early

September 2010, Moshe and Castro resumed speaking and,

on September 10, Moshe told Castro that Encarnacion was

refusing to pay. Moshe asked Castro if he wanted the

collector to “rough him up.” (App. at 1369-70.) Castro

responded, “Well, get, get my money. I want, I want my

money. They, they, they, they know how to get it.” (App. at

1371.) When Moshe said that the collector might “break[] a

leg, a hand, you know,” Castro responded, “I don‟t, I don‟t

want the guy dead. I don‟t, I don‟t want to kill him.” (App.

at 1373-76.)

During that conversation Castro broached the topic of

a second debt collection effort. Castro told Moshe of two

acquaintances, business partners Billy Wong and Alan Kats,

who were looking to hire a debt collector. Moshe noted that,

to extract money, the collectors would have to get rough with

Wong‟s and Kats‟s debtor. Castro asked Moshe to meet with

Wong on September 15, 2010. Castro admitted in his

testimony at trial that he understood, as of that date but not

before, that the supposed collectors would batter Wong‟s and

7

Kats‟s debtor. He also acknowledged that he became aware

at that time that the collectors Moshe had engaged for him

would use threats of violence and, if necessary, actual

violence to get money from Encarnacion. (District Court

Docket Item (“D.I.”) 90:228-29 (Tr. 4/14/11) (Castro: “On

[September 10], I crossed the line … . Q: [Wong and Kats‟

debtor is] gonna get beaten, right? Just like [Encarnacion] –

gonna get beaten, isn‟t that right? A: You can safely

inference that, yes, sir.”)).

On September 15, 2010, Moshe met with Wong and

Kats, who explained that they needed help collecting $26,000

that had been lost in a failed nightclub investment. Moshe

told them about the collector whom he had used for Castro,

and Kats told Moshe to go ahead and engage the collector‟s

services. Wong and Kats understood that compelling their

“debtor” to pay would involve threats of violence and,

perhaps, actual violence. On September 22, Wong and Kats

met with an undercover FBI agent posing as the collector, and

Kats authorized the agent to use violence to collect the

money. Later, on October 1, 2010, the undercover agent gave

Kats $3,000 supposedly collected from the debtor, and

approximately a month after that, the agent similarly gave

Kats an additional $5,000.

On September 21, 2010, Moshe again spoke to Castro

about the effort to collect money from Encarnacion. He said

that the collectors had recovered a “pretty big chunk” of

money by getting “pretty rough” with Encarnacion. (App. at

400-01.) Castro replied, “They got the end result.” (App. at

401.) About one week later, Moshe gave Castro $14,000 out

of $15,000 that had supposedly been collected from

Encarnacion, plus a $500 “referral fee” for referring Wong

8

and Kats to the “collectors.” (D.I. 91:87-88 (Tr. 4/15); D.I.

137:22 (Plea).) During that meeting, Castro also told Moshe

of a third collection job to refer to the collectors, this time for

$1.5 million in Florida.

Soon thereafter, on October 4, 2010, FBI agent Brian

Nichilo and Detective Steve Snyder of the Philadelphia Police

conducted an unrecorded interview with Castro in which they

pretended to be investigating a complaint from Encarnacion

that he was being threatened in relation to a debt he owed.

According to Nichilo‟s testimony at trial, Castro claimed that

he had not discussed with anyone the collection of a debt

from Encarnacion,1 that he did not hire anyone to extort

money from Encarnacion,2 and that he had not received any

money from Encarnacion. Specifically, Nichilo testified that

he asked Castro “whether he had ever collected any money

from Mr. Encarnacion since he originally gave him the

$90,000 in 2006.” (App. at 105-06.) Castro responded,

according to Nichilo, that he had not collected any money

from Encarnacion. (App. at 106.) In his own trial testimony

1

Count Four, on which the jury hung, charged Castro

with making a false statement to the FBI in violation of 18

U.S.C. § 1001 when he “told FBI agents that, outside of [a

civil] lawsuit [against Encarnacion] and general complaining

to friends,” he had “not had any discussions with anyone

about how he could collect from [Encarnacion].” (App. at

40.)

2

Count Five, another count on which the jury hung,

charged Castro with making a false statement to the FBI by

stating that “he did not hire anyone to threaten or hurt

[Encarnacion] to collect the debt.” (App. at 41.)

9

regarding that interview with law enforcement officials,

Castro admitted that he had “lied” when he “told them I

didn‟t know anything about what they asked me,” (App. at

121), and that he did not “tell them the truth.” (App. at 906.)

But Castro denied making the particular statements recounted

by Nichilo.

On October 12, 2010, Castro described his meeting

with the FBI to Moshe. Castro instructed Moshe to cease

collecting money from Encarnacion “for right now” (App. at

407), but he asked Moshe to have the collectors go to Florida

to commence a collection effort there.

Castro was arrested on November 5, 2010. FBI agents

searched his home and recovered the money that he had

received from Moshe and that he had been told came from

Encarnacion.

B. Course of Proceedings

A federal grand jury in the Eastern District of

Pennsylvania returned a ten-count superseding indictment on

February 3, 2011, against Castro. Only two counts are of

importance to this appeal. Count Three charged that on

October 4, 2010, in violation of 18 U.S.C. § 1001, Castro

made a false statement to federal law enforcement officers in

connection with his efforts to collect money from

Encarnacion – specifically, “that he had not received any

payments from [Encarnacion] towards the debt [Encarnacion]

supposedly owed” him. (App. at 39.) Count Nine charged

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Castro with conspiring with Wong and Kats to commit

extortion in violation of 18 U.S.C. § 1951.3

A jury convicted Castro on Count Three, acquitted him

on Count Ten, which charged the use of extortionate means to

collect a debt, in violation of 18 U.S.C. § 894, and returned a

hung verdict on the remaining eight counts. To avoid a

scheduled retrial, Castro entered into a plea agreement with

the government, pursuant to which he pled guilty to Count

Nine. The agreement included a broad waiver of his appellate

rights.

At sentencing, the parties agreed that the combination

of convictions on Counts Three and Nine led, under the

applicable sentencing guidelines, to a sentencing range of 30

to 37 months, based on an offense level of 19 and criminal

history category of I. The government also agreed to file a

motion seeking a three-level downward departure under

§ 3E1.1(b) of the guidelines. Pursuant to that provision of the

guidelines, the typical two-level reduction of a defendant‟s

offense level gained by accepting responsibility can become a

three-level reduction if the government files a motion 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

3

Wong, who was also charged in Counts Nine and Ten

of the superseding indictment, pled guilty to those counts and

agreed to testify against Castro. Kats was charged in a

separate indictment for his involvement in the extortion

scheme, and he pled guilty to attempted collection of credit

by extortionate means.

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and permitting the government and the court to allocate their

resources efficiently[.]”4 When the government made that

motion in this case, however, the Court sua sponte rejected it,

making Castro‟s offense level 20 (instead of 19), and

accordingly making the guidelines range 33 to 41 months

(instead of 30 to 37 months). The Court then imposed an

upward variance to bring the sentence to 60 months in prison

on Count Nine, concurrent with 18 months on Count Three,

to be followed by three years of supervised release. The

Court also imposed a $10,000 fine and $200 in special

assessments.

Castro then filed this timely appeal.

4

Section 3E1.1 provides in full:

(a) If the defendant clearly demonstrates

acceptance of responsibility for his offense,

decrease the offense level by 2 levels.

(b) If the defendant qualifies for a decrease

under subsection (a), the offense level

determined prior to the operation of subsection

(a) is level 16 or greater, and 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. Sentencing Guidelines Manual § 3E1.1.

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II. Discussion5

Castro raises three arguments on appeal. First, he

contends that his conviction should be vacated because “there

was a complete failure of proof on Count Three,” which

charged him with “knowingly making a false statement to the

FBI” by lying when he denied that he had received any

money from Encarnacion in repayment of the $90,000 lost

investment. (Appellant‟s Br. at 16.) Castro argues that, in

fact, he “had not received any such repayments” from

Encarnacion but had instead received money from the FBI in

a sting operation. (Id.) Thus, he says, his denial “was not

„false,‟ much less „knowingly‟ so.” (Id.) He reasons that

since his denial was literally true, even if he did not

appreciate it as such, “the evidence was insufficient to convict

on Count Three,” and his conviction on that count must “be

vacated and the case remanded for resentencing on Count

Nine alone.” (Id.)

Second, Castro maintains that his sentence was

procedurally unreasonable because the District Court

erroneously denied the government‟s motion that his offense

level be reduced not just two points but three points for

“acceptance of responsibility” under the sentencing

guidelines. He argues that § 3E1.1(b) of the guidelines

confers upon the government, not the court, “the discretion …

to allow a third level of reduction,” (id.), and that this

5

The District Court had subject matter jurisdiction

under 18 U.S.C. § 3231, because the indictment alleged

offenses against the United States. We have jurisdiction

under 28 U.S.C. § 1291 and 18 U.S.C. § 3742(a).

13

discretion is entitled to “full deference.” United States v.

Drennon, 516 F.3d 160, 162 (3d Cir. 2008).

Third, Castro asserts that his 60-month sentence is

procedurally and substantively unreasonable because the

guidelines range determined by the District Court suggested a

period of imprisonment of 33 to 41 months. He argues that

the Court did not adequately take into account evidence of his

good character and failed to explain why such a harsh

sentence was necessary to fulfill the proper purposes of

sentencing.

The government responds that Castro‟s first two

challenges are barred by the appellate waiver contained in his

plea agreement. In the alternative, the government argues

that even if the appellate waiver does not foreclose Castro‟s

claims, neither issue was raised in the District Court, and

Castro cannot show that either of those claimed problems

rises to the level of plain error. The government concedes

that Castro‟s third argument is not barred by the appellate

waiver, but it argues that “Castro cannot show that no

reasonable court would have imposed such a sentence under

[the] circumstances” of this case. (Appellee‟s Br. at 24-25.)

In the sections that follow, we address each of Castro‟s

three arguments, with the first two arguments being affected

by his appellate waiver.

A. Sufficiency of the Evidence for Castro’s

Conviction for False Statements

Before addressing either of Castro‟s first two

contentions, we must first determine whether his appellate

14

waiver bars us from even considering them. As part of his

plea agreement, Castro generally agreed that he would neither

appeal nor present any collateral challenge to his conviction

or sentence. In pertinent part, the appellate waiver provides

that, “[i]n exchange for the undertakings made by the

government in entering this plea agreement, the defendant

voluntarily and expressly waives all rights to appeal or

collaterally attack the defendant‟s conviction, sentence, or

any other matter relating to this prosecution[.]” (App. at

127.) The waiver does, however, contain two exceptions that

are relevant to this appeal: first, the waiver does not “bar the

assertion of constitutional claims that the relevant case law

holds cannot be waived” (App. at 127); and, second, the

waiver allows appeal for “claims that … the sentencing judge,

exercising the Court‟s discretion pursuant to United States v.

Booker, 543 U.S. 220 (2005), imposed an unreasonable

sentence above the final Sentencing Guideline range

determined by the Court.” (App. at 128.)

“We exercise plenary review in deciding whether an

issue raised by a defendant falls within the scope of an

appellate waiver in his plea agreement.” United States v.

Goodson, 544 F.3d 529, 537 n.6 (3d Cir. 2008). When “the

government invokes an appellate-waiver provision … , we

must determine as a threshold matter whether … [that] waiver

prevents us from exercising our jurisdiction to review the

merits of the defendant‟s appeal.” United States v. Corso,

549 F.3d 921, 926 (3d Cir. 2008) (citations omitted). “We

decline to exercise jurisdiction over the appeal where [1] the

issues on appeal fall within the scope of the waiver and [2]

the defendant knowingly and voluntarily agreed to the waiver,

unless [3] „enforcing the waiver would work a miscarriage of

justice.‟” United States v. Saferstein, 673 F.3d 237, 242 (3d

15

Cir. 2012) (quoting Corso, 549 F.3d at 927); accord United

States v. Hahn, 359 F.3d 1315, 1325 (10th Cir. 2004) (en

banc).

Under the first prong, we evaluate the language of the

appellate waiver to determine if the disputed appeal falls

within its scope. We follow the “well-established principle

that plea agreements, although arising in the criminal context,

are analyzed under contract law standards.” Goodson, 544

F.3d at 535 n.3 (alteration and internal quotation marks

omitted). “[I]n light of those standards, the language of an

appellate waiver, like the language of a contract, matters

greatly to our analysis[.] [S]uch waivers must be strictly

construed.” Corso, 549 F.3d at 927 (citation, alteration, and

internal quotation marks omitted); cf. United States v.

Williams, 510 F.3d 416, 422 (3d Cir. 2007) (“In view of the

government‟s tremendous bargaining power courts will

strictly construe the text [of a plea agreement] against the

government when it has drafted the agreement.” (alterations

omitted)). “But we are also mindful that under contract

principles, a plea agreement necessarily works both ways.

Not only must the government comply with its terms and

conditions, but so must the defendant.” Corso, 549 U.S. at

927 (citations, alteration, and internal quotation marks

omitted). Accordingly, a defendant cannot “get the benefits

of his plea bargain, while evading the costs because contract

law would not support such a result.” Id. (alteration and

internal quotation marks omitted).

The second step in reviewing an appellate waiver is to

determine whether the waiver is knowing and voluntary.

“[T]he role of the sentencing judge is critical” in that regard,

United States v. Khattak, 273 F.3d 557, 563 (3d Cir. 2001),

16

because rule 11(b)(1)(N) of the Federal Rules of Criminal

Procedure provides that

Before accepting a plea of guilty or nolo

contendere, … the court must address the

defendant personally in open court. During this

address, the court must inform the defendant of,

and determine that the defendant understands

the following: … the terms of any plea-

agreement provision waiving the right to appeal

or to collaterally attack the sentence.

Fed. R. Crim. P. 11(b)(1)(N). We have held that “a statement

made by the sentencing court during the [plea] colloquy can

create ambiguity where none exists in the plain text of the

plea agreement,” Saferstein, 673 F.3d at 243, and such

ambiguity may result in a narrow construction of an appellate

waiver, “to protect the defendant as the weaker bargaining

party,” id.

The third and last step is to determine whether

enforcing the waiver would result in a miscarriage of justice.

When a waiver encompasses the issue on appeal and was

entered knowingly and voluntarily, it must be enforced except

in the “unusual circumstance” of “an error amounting to a

miscarriage of justice.” Khattak, 273 F.3d 562. Certain

factors weigh in the determination of whether a given error

meets that standard:

[T]he clarity of the error, its gravity, its

character (e.g., whether it concerns a fact issue,

a sentencing guideline, or a statutory

17

maximum), the impact of the error on the

defendant, the impact of correcting the error on

the government, and the extent to which the

defendant acquiesced in the result.

Id. at 563 (internal quotation marks omitted). Courts apply

the “miscarriage of justice” exception “sparingly and without

undue generosity,” United States v. Wilson, 429 F.3d 455,

458 (3d Cir. 2005) (internal quotation marks omitted), but

with the aim of avoiding “manifest injustice,” United States v.

Gwinnett, 483 F.3d 200, 206 (3d Cir. 2007).6

6

It is not enough that an issue be meritorious:

[B]y waiving the right to appeal, a defendant

necessarily waives the opportunity to challenge

the sentence imposed, regardless of the merits.

… A waiver of the right to appeal includes a

waiver of the right to appeal difficult or

debatable legal issues – indeed, it includes a

waiver of the right to appeal blatant error.

Waiver would be nearly meaningless if it

included only those appeals that border on the

frivolous. … While it may appear unjust to

allow criminal defendants to bargain away

meritorious appeals, such is the necessary

consequence of a system in which the right to

appeal may be freely traded.

Khattak, 273 F.3d at 561-62 (internal quotation marks

omitted).

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1. Scope of the Appellate Waiver

This case presents a procedural anomaly. Ordinarily,

plea agreements are entered before any trial in a case, but

Castro entered his plea agreement in anticipation of a second

trial, after he had been tried once and convicted on one of ten

counts. Our first task in determining whether Castro‟s

appellate waiver should be enforced to prevent him from

challenging his conviction for the crime charged in Count

Three is to determine whether the waiver even encompasses

that conviction.

Castro asserts that the language of the appellate waiver

does not clearly apply to his conviction at trial. Because plea

agreements are to be “strictly construed” against the

government, Khattak, 273 F.3d at 562, he says that his

appellate waiver should not apply to his conviction on Count

Three. He cannot, however, wish away the words of the

waiver. The plea agreement provides that Castro “voluntarily

and expressly waives all rights to appeal or collaterally attack

[his] conviction, sentence, or any other matter relating to this

prosecution.” (App. at 127.) The breadth of the phrase “any

other matter relating to this prosecution” surely encompasses

Castro‟s earlier conviction on Count Three, and Castro‟s

attempt to argue otherwise is unavailing.

2. Knowing and Voluntary Waiver

But understanding the linguistic scope of the waiver is

only the first step in determining whether the waiver applies.

Castro claims that, during the Rule 11 colloquy, the District

Court did not mention his earlier conviction, and that he was

therefore under the impression that the waiver did not apply

19

to that conviction. Instead, says Castro, the Court

consistently emphasized that he was giving up his right to a

second trial and the right to appeal his sentence. Thus, Castro

argues, “it is at least reasonable to conclude that the plea

agreement did not concern the count on which there had

already been a full trial.” (Appellant‟s Reply Br. at 5.)

Although he does not say so explicitly, Castro appears

to be seeking shelter in our precedent that a judge‟s

affirmative statements during a plea colloquy can sometimes

overcome the otherwise plain terms of a plea agreement.7

Such judge-created “ambiguity” must be construed “against

the government,” Saferstein, 673 F.3d at 243, because, “[i]f it

is reasonable to rely upon the court‟s words for clarification,

then we cannot expect a defendant to distinguish and

disregard those statements of the court that deviate from the

language of a particular provision in a lengthy plea

agreement,” United States v. Wilken, 498 F.3d 1160, 1168

(10th Cir. 2007).

Castro‟s argument is an elaboration on that precedent.

He argues in essence that, by talking at length about the rights

he would give up by foregoing a second trial, the District

Court left him thinking that the waiver applied only

prospectively and not as to the already fixed history of the

case. He suggests, in other words, that it is not only a district

court‟s affirmative statements that can change the scope of a

7

As noted, we have held that, even when the written

terms of an appellate waiver are clear, “a statement made by

the sentencing court during the colloquy can create ambiguity

where none exists in the plain text of the plea agreement.”

Saferstein, 673 F.3d at 243.

20

plea agreement; a district court‟s emphases and omissions

during a plea colloquy may also alter the defendant‟s

understanding of the plain terms of the plea agreement. We

have never so held and we will not do so now.

Indeed, even if we were to accept Castro‟s assertion

that the District Court injected some confusion into the scope

of the appellate waiver through emphasis and omission during

the plea colloquy, we cannot accept that the colloquy

overcame the import that the plea agreement‟s terms must

have had for Castro, a man with years of law enforcement

experience and two post-graduate degrees. A deficient plea

colloquy will not overcome the plain terms of an appellate

waiver when the defendant is highly educated and should

accordingly be held to his informed understanding of the text

of the waiver. See Goodson, 544 F.3d at 540-41 (defendant

who was “college educated” and who had “successfully

perpetrated wire fraud and the uttering of counterfeit checks”

was held to his informed understanding of the plain terms of

the plea agreement). Castro affirmed under oath that he

understood the plea agreement, and nothing in the record

undermines that affirmation. Given the plain terms of the

plea agreement in this case, and given Castro‟s education and

professional background, we conclude that he knowingly and

voluntarily waived his right to appeal his “conviction … or

any other matter relating to this prosecution.” (App. at 127.)

3. Miscarriage of Justice

Castro‟s knowing and voluntary waiver forecloses his

appeal of the conviction on Count Three, unless the waiver

would result in a miscarriage of justice. Castro says it would,

because the record is devoid of evidence that he made a false

21

statement when he stated that he received no money from

Encarnacion in repayment of his $90,000 investment. We are

compelled to agree.

We have not previously evaluated a challenge to an

appellate waiver that is grounded on a claim of insufficiency

of evidence amounting to a miscarriage of justice. We have,

however, evaluated claims of insufficiency of evidence in the

plain error context and have explained that plain error

warranting reversal exists when the insufficiency “resulted in

a fundamental miscarriage of justice.” United States v. Barel,

939 F.2d 26, 37 (3d Cir. 1991). To determine if that exacting

standard is met, “we review the evidence in the light most

favorable to the Government and will sustain the verdict

unless a rational juror could not have found that the

Government proved” one or more elements of the offense

beyond a reasonable doubt. United States v. Williams, 299

F.3d 250, 253-54 (3d Cir. 2002). The prosecution‟s failure to

prove an essential element of the charged offense does

constitute plain error, United States v. Wolfe, 245 F.3d 257,

260-61 (3d Cir. 2001), and so can be understood as a

miscarriage of justice, see United States v. Jones, 471 F.3d

478, 480 (3d Cir. 2006) (“[A]ffirming a conviction where the

government has failed to prove each essential element of the

crime beyond a reasonable doubt affect[s] substantial rights,

and seriously impugns the fairness, integrity and public

reputation of judicial proceedings.” (internal quotation marks

omitted)).

It bears emphasis, however, that a “manifest

miscarriage of justice” warranting reversal on plain error

review occurs only where the record is “devoid of evidence

pointing to guilt” – a “stricter than usual standard.” United

22

States v. Green, 293 F.3d 886, 895 (5th Cir. 2002) (internal

quotation marks omitted); see also United States v. Vasquez,

560 F.3d 461, 469 (6th Cir. 2009) (“Because [defendant]

failed to move for a judgment of acquittal at either the close

of the government‟s case or the close of his case, we will

reverse his conviction only if the record is devoid of evidence

pointing to guilt, such that a manifest miscarriage of justice

occurred.” (internal quotation marks omitted)); United States

v. Irby, 558 F.3d 651, 653 (7th Cir. 2009) (“[R]eversal is

warranted only if the record is devoid of evidence pointing to

guilt, or if the evidence on a key element was so tenuous that

a conviction would be shocking.” (internal quotation marks

omitted)); United States v. Spinner, 152 F.3d 950, 956 (D.C.

Cir. 1998) (“[A] miscarriage [of justice] would exist only if

the record is devoid of evidence pointing to guilt, or because

the evidence on a key element of the offense was so tenuous

that a conviction would be shocking.” (alteration and internal

quotation marks omitted)).

These insights from the plain error context are

applicable to the “miscarriage of justice” argument before us

now. Cf. Hahn, 359 F.3d at 1327 (holding that for an error to

result in a miscarriage of justice that overcomes an appellate

waiver “„the error [must] seriously affect[] the fairness,

integrity or public reputation of judicial proceedings‟”

(quoting United States v. Olano, 507 U.S. 725, 732 (1993)

(alterations in original)). Castro is therefore required to show

that, when viewed in the light most favorable to the

government, the record is entirely devoid of evidence that he

committed each element of a § 1001 offense – specifically,

that he made a false statement to government officials when

he insisted that he had not received money from Encarnacion

in repayment of his $90,000 loan – so that allowing his

23

conviction to stand would “seriously impugn[] the fairness,

integrity and public reputation of judicial proceedings.”

Jones, 471 F.3d at 480 (internal quotation marks omitted).

Section 1001 calls for punishment of anyone who

“knowingly and willfully … makes any materially false,

fictitious, or fraudulent statement or representation” in any

matter within the jurisdiction of the federal government. 18

U.S.C. § 1001(a)(2).

To establish a violation of § 1001, the

government [is] required to prove each of the

following five elements: (1) that [the accused]

made a statement or representation; (2) that the

statement or representation was false; (3) that

the false statement was made knowingly and

willfully; (4) that the statement or

representation was material; and (5) that the

statement or representation was made in a

matter within the jurisdiction of the federal

government.

United States v. Moyer, 674 F.3d 192, 213 (3d Cir. 2012). It

is uncontroverted that all three payments that Castro received,

ostensibly in repayment of Encarnacion‟s “debt,” were in fact

not from Encarnacion but rather from the FBI through Moshe.

None of the money in question actually came from

Encarnacion, either directly or indirectly, nor had Castro

collected any other money from Encarnacion in repayment

for the supposed debt. Castro‟s statement that he had not

received money from Encarnacion, though intended to be a

lie, was therefore entirely true, and the government cannot

prove the second element of the offense.

24

That fact is crucial because, to properly convict Castro

of violating § 1001, the government must be able to show that

he made a statement to government agents that was untrue,

and the government cannot satisfy that burden by showing

that the defendant intended to deceive, if in fact he told the

literal truth. In Bronston v. United States, 409 U.S. 352, 362

(1973), the Supreme Court held that a conviction under the

federal perjury statute, 18 U.S.C. § 1621, cannot rest on

testimony that is unresponsive to the interrogation, even if

intentionally deceptive, so long as the answer in question is

literally true and the questioner is free to ask further

clarifying questions. We applied Bronston in United States v.

Serafini, 167 F.3d 812, 822-24 (3d Cir. 1999), affirming the

dismissal of a charge under the “false material declarations”

statute, 18 U.S.C. § 1623, as applied to grand jury

questioning. In Serafini, we also stated that § 1001 is “[a]

close kin” to §§ 1621 and 1623. 167 F.3d at 813 n.2. Thus,

the same interpretive principles apply to § 1001 prosecutions

as were applied in Bronston and Serafini. See also United

States v. Milton, 8 F.3d 39, 45 (D.C. Cir. 1993) (“The defense

of literal truth applies to section 1001 prosecutions … .”).

Accordingly, when a statement is literally true, it is, by

definition, not false and cannot be treated as such under a

perjury-type statute, no matter what the defendant‟s

subjective state of mind might have been. Cf. Williams v.

United States, 458 U.S. 279, 284-85 (1982) (a bad check,

even when knowingly used to defraud, cannot be a “false

statement” within the meaning of 18 U.S.C. § 1014, because

as a matter of negotiable instruments law a check makes no

assertion about the truth of any matter stated thereon).

25

Viewing the record as required by Bronston, it is

devoid of evidence that Castro made a false statement when

he told government agents that he had not received money

from Encarnacion. On the contrary, that statement was

completely, if unintentionally, accurate. Thus, allowing his

conviction on Count Three to stand would be to allow a

conviction when there has been a complete failure of proof on

an essential element of the charged crime, and that would

seriously impugn the fairness, integrity, and public reputation

of our courts. In short, such a conviction constitutes a

miscarriage of justice.

The government nevertheless argues that, given

Castro‟s belief that he was lying to FBI agents, there is

nothing unfair in his conviction. (See Appellee‟s Br. at 37

(“Castro does not contend that he was unjustly charged with

or convicted of this offense, but argues only that the evidence

was legally insufficient to support his conviction.”).) In the

broadest sense, it is surely so that Castro was morally wrong

even if not legally guilty, but our legal system does not

convict people of being bad. If they are to be convicted, it is

for specific crimes, and the government here undertook the

burden of proving that Castro had committed each element of

the specific crime set forth in § 1001. It failed to do that.

The government tries to work its way around this

failure-of-proof problem by arguing for a “sting operation

exception” in § 1001 prosecutions. As the government sees

it, whether Castro‟s statements were literally true is

irrelevant, as long as he subjectively believed he was lying to

the FBI when he made them. A contrary position, the

government argues, “would pervert the very purpose of the

literal truth defense, which is to protect people from

26

prosecution for literally true responses to the precise question

asked, and surely was not intended to protect those who

knowingly and willfully lie about their actions solely because

they unknowingly acted in collusion with a government agent

instead of a true criminal cohort.” (Appellee‟s Br. at 47.)

The ready and dispositive response to that argument is

that, even if a “sting exception” to the strictures of § 1001 is a

good idea, it is simply not in the statute. Congress knows

how to pass laws that penalize statements made to law

enforcement officers by a defendant who incorrectly believes

the statements to be false. Compare 18 U.S.C. § 1956(a)(1)

(“knowing” laundering of funds “which in fact involves the

proceeds” of a crime), with id. § 1956(a)(3) (intentional

laundering of funds “represented to be” proceeds of a crime).

But it did not do so when it enacted § 1001, and we are not

free to amend the law. Under analogous circumstances, the

United States Court of Appeals for the Second Circuit

reversed as plain error a conviction for “knowing possession”

of stolen government property because the property was not

actually “stolen” but was rather sold to the defendant by

agents in a sting operation. United States v. Golomb, 811

F.2d 787, 792-93 (2d Cir. 1987). “Knowledge and belief are

very different mental states,” the court held, and although the

defendant “may very well have believed the checks were

stolen, … [the statute] cannot be interpreted to support a

conviction when the property at issue was not stolen.” Id. at

792.

The government nevertheless insists that a jury could

conclude, based on the evidence, “that the money Castro

received came „from‟ Encarnacion.” (Appellee‟s Br. at 41.)

According to the government, “[t]he FBI paid $21,000 in real

27

cash to Castro, through its agent, Moshe, and represented

through Moshe that the payments were on behalf of

Encarnacion. A jury could thus readily determine that Castro

received money „from‟ Encarnacion, and lied about it to the

agents when asked.” (Id. at 41.) It is not clear how the

quotation marks around the word “from” in that sentence help

the argument. The money was not “from” Encarnacion in any

sense, and we are frankly at a loss to understand the

government‟s assertion that Castro “not only believed that his

answer was false … , but it was in fact false.” (Appellee‟s

Br. at 50.) There is, quite literally, no evidence whatsoever

that even a penny of the money that Moshe handed over to

Castro came from Encarnacion. To say, as the government

does, that “[t]he FBI actually gave Castro $21,000 on

Encarnacion‟s behalf” (Appellee‟s Br. at 52), is an invention,

since nothing shows that Encarnacion owed Castro anything,

much less that he authorized the government to pay Castro on

his behalf. Castro is therefore not guilty on Count Three,

because the statement set forth in that count simply was not

false.8

8

The District Court‟s jury instructions were correct in

highlighting that “[a] false … statement … is an assertion

which is untrue when made.” (D.I. 92:150-51 (Tr. 4/18/11)

(emphasis added).) The subjective belief of the person

making the statement is an entirely separate element of the

offense. The false statement must be “known by the person

making it or using it to be untrue.” (Id.) In this regard, we

note our disagreement with the government‟s assertion that

“the fact that Castro was not charged with attempting to make

a false statement is of no consequence.” (Appellee‟s Br. at

52.) What is charged is of enormous consequence, and had

28

The complete failure of proof on the “actual falsity”

element of the offense charged in Count Three requires

reversal of Castro‟s conviction on that count, as the

conviction is infected with plain error and constitutes a

miscarriage of justice.

B. The District Court’s Denial of the

Government’s Motion for an Additional One

Point Reduction in Castro’s Offense Level for

Acceptance of Responsibility

Castro also contends that his 60-month sentence under

Count Nine is procedurally unreasonable because the District

Court erred in refusing to reduce his offense level under

§ 3E1.1(b). In his view, the additional adjustment is

mandatory if the government moves for it and the other

requirements of the provision are met. Whether that is so is a

question we have not addressed but which has divided other

circuits. Compare United States v. Williamson, 598 F.3d 227

(5th Cir. 2010) (district court has authority to determine

whether conditions for one level reduction for acceptance of

responsibility under § 3E1.1 have been satisfied), with United

States v. Mount, 675 F.3d 1052, 1055-57 (7th Cir. 2012)

(application of additional one level decrease in defendant‟s

offense level under § 3E1.1 is mandatory). We decline to

address that question, however, because it is precluded by

Castro‟s appellate waiver and no miscarriage of justice would

result from enforcing the waiver on this point.

there been an effort to charge and prove an attempt, there

would be another and very different set of legal issues in play.

29

Castro says that his argument is not precluded by the

appellate waiver because it implicates one of the express

exceptions contained in the waiver – namely, the exception

for “constitutional claims that the relevant case law holds

cannot be waived.”9 (App. at 127.) But Castro provides no

relevant authority to demonstrate that the “constitutional

claims” exception applies in this context. It appears instead

that a district court‟s arguably erroneous calculation of a

guidelines range “is precisely the kind of „garden variety‟

claim of error contemplated by [an] appellate waiver.”

Sotirion v. United States, 617 F.3d 27, 38 (1st Cir. 2010). It

is not a “miscarriage of justice.” See Corso, 549 F.3d at 931-

32 (“[A]llow[ing] alleged errors in computing a defendant‟s

sentence to render a waiver unlawful would nullify the waiver

based on the very sort of claim it was intended to waive.”

(second alteration in original) (internal quotation marks

omitted)); United States v. Price, 558 F.3d 270, 283-84 (3d

9

Castro does not claim, as he did when arguing that

his conviction under Count Three was not covered by the

appellate waiver provision, that the District Court‟s plea

colloquy injected uncertainty into the meaning of the

otherwise plain terms of the appellate waiver. Nor could he.

A review of the plea colloquy establishes that the District

Court properly questioned Castro and took affirmative steps

to ensure that his plea was knowing and voluntary.

Specifically, Castro testified that he had read the terms of the

plea agreement, that he had discussed them with his attorney,

that he agreed to all of the terms, and that he understood that

the agreement limited his right to appeal. Castro‟s plea was

thus knowing and voluntary with respect to the District

Court‟s denial of the government‟s motion for a one-level

reduction in Castro‟s offense level pursuant to § 3E1.1(b).

30

Cir. 2009) (holding enforcement of an appellate waiver would

not constitute a miscarriage of justice despite defendant‟s

claim that the government abused its discretion by not

requesting an additional reduction in the district court‟s

sentencing calculation); United States v. Mabry, 536 F.3d

231, 243 (3d Cir. 2008) (defendant‟s challenges to district

court‟s sentencing calculation were “insubstantial and clearly

encompassed by the broad waiver,” and “[did] not implicate

fundamental rights or constitutional principles”).

Castro has failed to demonstrate that his appellate

waiver does not encompass this claim or that he did not waive

it knowingly and voluntarily, and he has not established that

enforcement of the appellate waiver would result in a

miscarriage of justice. We thus decline to exercise

jurisdiction over his appeal with respect to the District

Court‟s rejection of the government‟s motion for a downward

departure under § 3E1.1(b).

C. The Procedural and Substantive

Reasonableness of Castro’s 60-Month Sentence

Under Count Nine

Finally, Castro argues that, when it imposed a sentence

that varied upwards by nearly 50 percent above the highest

sentence recommended by the guidelines, the District Court

produced a sentence that was procedurally and substantively

unreasonable. According to Castro, the Court did not

adequately explain why such a harsh sentence was necessary

to achieve the legitimate aims of sentencing, considering all

the aggravating and mitigating factors of the case, and the

Court did not adequately account for Castro‟s lengthy record

31

of good works.10 In response, the government supports the

sentence as well justified in light of numerous statements by

the District Court explaining the reasons for the sentence

given. We agree that the sentence was well explained, but,

given the flawed inclusion of Count Three in the sentencing

calculus, the overall sentence must be reassessed.

Despite our well-known procedure for reviewing

criminal sentences,11 the District Court‟s upward variance is

10

Castro‟s arguments in this regard are not foreclosed

by his appellate waiver because the waiver contains an

exception for “claims that … the sentencing judge, exercising

the Court‟s discretion pursuant to United States v. Booker,

543 U.S. 220 (2005), imposed an unreasonable sentence

above the final Sentencing Guideline range.” (App. at 128.)

11

Our review of a criminal sentence “proceeds in two

stages.” United States v. Tomko, 562 F.3d 558, 567 (3d Cir.

2009) (en banc). First, we review the sentence for procedural

error, “such as failing to calculate (or improperly calculating)

the Guidelines range, treating the Guidelines as mandatory,

failing to consider the § 3553(a) factors, selecting a sentence

based on clearly erroneous facts, or failing to adequately

explain the chosen sentence – including an explanation for

any deviation from the Guidelines range.” Gall v. United

States, 552 U.S. 38, 51 (2007). If there was procedural error,

“our preferred course is to remand the case for re-sentencing,

without going any further.” United States v. Merced, 603

F.3d 203, 214 (3d Cir. 2010). Second, if there was no

procedural error, “we review for substantive reasonableness,

and „we will affirm [the sentence] unless no reasonable

sentencing court would have imposed the same sentence on

that particular defendant for the reasons the district court

32

unreviewable at this juncture, because, in calculating Castro‟s

“combined offense level” for “multiple counts” using the

method supplied by § 3D1.4 of the sentencing guidelines, the

Court arrived at an offense level that was one level higher (20

instead of 19) than would have resulted if the conviction on

Count Three had not been included. That in turn led to a

guidelines range of 33 to 41 months instead of 30 to 37

months. “[G]iven the importance of a correct Guidelines

calculation both to the sentencing process that district courts

are required to conduct and to our ability to carry out

reasonableness review, the use of an erroneous Guidelines

range will typically require reversal under 18 U.S.C.

§ 3742(f).” United States v. Langford, 516 F.3d 205, 215 (3d

Cir. 2008). Our reversal of Castro‟s conviction under Count

Three accordingly necessitates a remand for resentencing

solely for Castro‟s guilty plea on Count Nine. See id. at 211,

214 (“[A] correctly calculated Guidelines range will often be

a necessary precondition of our reasonableness review.

Where a district court begins with an erroneous range, it will

be difficult for us to determine that it fulfilled its duty to

consider the Guidelines and reason through to the ultimate

sentence,” because “the correct computation of the Guidelines

range and any departures therefrom serves to clarify the basis

for the sentence imposed and thus facilitates reasonableness

review.”).

We note with appreciation the District Court‟s

thorough and thoughtful accounting of the aggravating and

provided.‟” United States v. Negroni, 638 F.3d 434, 443 (3d

Cir. 2011) (quoting Tomko, 562 F.3d at 568). At both stages

we review for abuse of discretion. United States v. Wise, 515

F.3d 207, 217-18 (3d Cir. 2008).

33

mitigating circumstances in this case and its explanation for

why it concluded that an upward variance was necessary to

accomplish the legitimate aims of sentencing.12 Despite that

exemplary handling of the always difficult work of crafting

and explaining an appropriate sentence, we must nevertheless

remand for resentencing because we cannot conclude with

confidence that, had the District Court operated from the

12

For example, the Court specifically acknowledged

much of Castro‟s good character, including that, “[w]ith

perhaps one or two exceptions, I have never received as many

letters attesting to a defendant‟s good character and urging

leniency as I have in this case,” which showed that, “[c]learly,

he has the support and respect of many people in this

community and elsewhere.” (App. at 225.) The Court also

recognized that Castro “has shown contrition for what he has

done” and “is sincere in saying that he is sorry.” (App. at

228.) Despite Castro‟s “many good works, particularly with

children” (App. at 225), the Court expressed deep concern

over Castro‟s willingness to use “force and violence.” (App.

at 227; see also id. (“I can‟t emphasize this enough, if force

and violence had been used, someone could have been

killed.”).) But “most troubling” to the Court was that Castro

was a police officer, and police officers “are held to a much

higher standard.” (App. at 230.) The Court felt “a

compelling need to afford adequate deterrence to criminal

conduct, particularly to deter others in law enforcement who

may contemplate illegal conduct.” (App. at 229.) After

considering the mitigating and aggravating evidence, the

Court found that the nature of Castro‟s conduct and the

tremendous damage caused by that conduct outweighed the

positive aspects of Castro‟s history and character, and called

for a higher sentence.

34

correct guidelines range (30 to 37 months instead of 33 to 41

months), it would still have given a 60-month sentence. See

Langford, 516 F.3d at 215 (“[T]he improper calculation of the

Guidelines range can rarely be shown not to affect the

sentence imposed.” (internal quotation marks omitted)).

On remand, the District Court is “free to make its own

reasonable application of the § 3553(a) factors” and

ultimately may choose “to reject (after due consideration) the

advice of the Guidelines” and impose the same sentence.

Kimbrough v. United States, 552 U.S. 85, 113 (2007) (Scalia,

J., concurring). But it must consider the correct guidelines

range.

III. Conclusion

For the foregoing reasons, we will reverse Castro‟s

conviction and 18-month sentence after trial on Count Three

and remand to the District Court for entry of a judgment of

acquittal on that count. We will also vacate Castro‟s 60-

month sentence under Count Nine and remand to the District

Court for resentencing on that count, using the correct

guidelines range.

35