This question has been answered in the affirmative by every court of appeals that has addressed it—the Sixth, Seventh, Eighth, and Ninth. The Third Circuit on March 12, 2014 followed their lead in United States v. Woronowicz. The decision came after Woronowicz challenged the 41-month term of imprisonment he received after pleading guilty to a one-count indictment charging him with counterfeiting in violation of 18 U.S.C. § 474.
The background facts outlined in the Third Circuit’s decision reveal that Woronowicz and the Government did see eye-to-eye on a lot of things. He was initially convicted in 2008 for four counts of willfully failing to file tax returns. He was given a 12-month prison term and 1 year of supervised release. Following his release from penal custody into supervised release, Woronowicz violated the conditions of his supervised release resulting in an additional 3-month prison term. The district court allowed him to self-surrender but apparently Woronowicz didn’t like that idea so he failed to turn himself in. That didn’t last long before he was arrested again for “failure to surrender.”
In custody again, Woronowicz apparently gave up on freedom. He gave law enforcement officials “consent” to search his residence at which they discovered counterfeit currency with a face value $207,980. But it was not as bad as it seemed. 90 percent of the bills were completed only on one side with the remaining $20,000 being complete on both sides.
The district court accepted the Presentence Report recommendation that a 12-level enhancement was applicable pursuant to USSG § 2B5.1(b)(1)(B) because the face value of the counterfeit currency exceeded $200,000.
Woronowicz vigorously disagreed, arguing that “he should receive no more than a 4-level enhancement since only 10% of the counterfeit notes were fully completed.” The district court calculated Woronowicz’ total offense level and criminal history resulting in an advisory Guidelines range 51 to 63 months. The court, however, departed downward from the recommended range with the 41-month term, justifying the departure by considering the many incomplete bills as a mitigating factor.
§ 2B5.1 defines a counterfeit item as “an instrument that has been falsely made, manufactured, or altered.” The Guidelines have one specific exception to this definition: Note 3 of § 2B5.1 provides that “items that are so obviously counterfeit that they are unlikely to be accepted even if subjected to only minimal scrutiny.” The Third Circuit in 1998 in United States v. Taftsiou held this exception does not apply to “notes of unpassable quality.” The court said these defective bills do count toward the “face value” of counterfeit items under Subsection (b)(1). Thus, against the Taftsiou backdrop, the appeals court in Woronowicz had little problem extending this rule to incomplete bills which “are merely notes that could be considered to be of unpassable quality. Therefore, extending our holding in Taftsiou, we now hold that incomplete bills are ‘counterfeit items’ under § 2B5.1(b)(1) and must be counted in calculating the total face value.”
Thus, any counterfeit bill, regardless of its quality or lack thereof, is a counterfeit item subject to the enhancement provisions of § 25B.1.
The Woronowicz case is illustrative of another important point: the need to cite “on point” cases in appeal briefs. The Third Circuit explained:
“Woronowicz’ argument that there are an ‘abundance of cases wherein convictions for counterfeiting were reversed because the counterfeit bills were not of passable quality,’ is misplaced. First, the cases he relies on involved a different statute from the one at issue here—18 U.S.C. § 472 rather than § 474. Unlike § 472, § 474, prohibits the possession of currency made ‘in whole or in part, after the similitude’ of U.S. currency. Second, the cases he cites involved challenges to convictions, not challenges to sentences. Woronowicz’ sentencing range is determined by the Sentencing Guidelines, not the underlying counterfeit statute. Since the relevant Guideline provision bases the appropriate sentencing level enhancement on the face value of the counterfeit items, and since the face value here is $207,980, the District Court did not err in applying a 12-level enhancement.”
There is little room for error in brief writing: one on-point case cite is better than a dozen off-point case cites.
The same is true for arguments presented in appeal briefs.
“Woronowicz states that this was his first felony conviction, and that statistical data would suggest that persons over 50 have a low risk of recidivism. This argument makes little sense, given that his history of criminal convictions began after the age of 50 and that he has a track record of failing to cooperate with law enforcement even after being shown leniency.”
The fact that the Fifth Circuit has not addressed this specific issue means that attorneys practicing in this jurisdiction must raise the argument that the enhancement provisions of § 25B.1 apply only to passable quality bills and not to those of unpassable quality.