10th U.S. Circuit Court of Appeals vacates mortgage-fraud sentence

Journal Record, The (Oklahoma City),  Dec 13, 2007  by Marie Price

Tags: U.S. Circuit Court

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The 10th U.S. Circuit Court of Appeals has vacated a Colorado man's sentence for mail fraud and other offenses in a mortgage- fraud case, ruling that the federal district court did not resolve factual disputes as to whether James Galloway's fraudulent conduct actually caused a loss.

The Denver appeals court also said that restitution must be based on actual loss, not the defendant's gain in the situation.

The U.S. District Court of Colorado found an undetermined loss and used Galloway's gain as a measure of loss in calculating his sentence, also requiring him to pay his commissions to the victim.

In so doing, the lower court applied a four-level enhancement to Galloway's sentence.

Galloway was accused of conspiring against the United States by obtaining mortgages for unqualified buyers, referring them to a man who prepared false Social Security numbers, pay stubs, tax forms, credit reports and other bogus information to include in mortgage loan applications.

The appellate court said proposed amounts of loss ranged from zero to more than $122,990, and criticized the trial court for substituting Galloway's gain as a measure of loss "without a basis for why that substitution is reasonable."

Upon remand, the lower court must determine whether there was an actual loss and impose restitution in that amount.

In another Colorado case, the appeals court reversed summary judgment for police, who were accused of using excessive force by Tasering and beating a man who had come to a local courthouse to contest a traffic ticket.

After losing the case, Edward Casey walked to the parking lot to retrieve money from his vehicle to pay the fine, carrying his court file with him.

As he was returning to the courthouse, Casey was tackled, Tasered and beaten by Federal Heights, Colo, police officers.

Casey had been told by the traffic court judge to take his court file to the cashier's window along with funds to pay his fine. He was told by a court clerk not to take the file from the building, which the appellate court said may have been a misdemeanor under Colorado law.

Casey was stopped by a police officer while returning from his truck, but tried to move around the officer to take the file to the cashier. Casey tried to continue his walk back to the courthouse and was tackled by the officer, who Casey said never told him he was under arrest or to stop resisting. Another officer then arrived and fired a Taser gun at Casey. Several other officers arrived, and Casey was brought to the ground. Witnesses said that the officers repeatedly banged Casey's face into the concrete. According to the court, one officer Tasered Casey again by pressing the gun's electrical barbs directly into him without launching them.

Casey was charged with resisting arrest, obstructing a peace officer and obstructing government operations, all misdemeanors.

He sued the city and one of the police officers.

The lower court dismissed all of his claims on summary judgment, and Case appealed.

The appellate court said that Casey's conduct would not have impaired government operations had he been allowed to bring the file back. It also described the testimony of independent witnesses who said that a police officer was the aggressor and that Casey was not violent during the encounter.

The first officer's treatment of Casey was not reasonable for a nonviolent misdemeanant who was neither dangerous nor fleeing, the court said. That officer also did nothing to prevent the Tasering and beating, the court added, also holding that the officer who used the Taser was not entitled to qualified immunity in the case.

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