memo martinez sentencia bravo martinez noticel

8/3/2019 Memo Martinez Sentencia Bravo Martinez NotiCel

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UNITED STATES DISTRICT COURTFOR THE DISTRICT OF PUERTO RICO

UNITED STATES OF AMERICA, ))

v. )) CRIMINAL CASE NO. 10-232

JUAN BRAVO FERNANDEZ )and )

HECTOR MARTNEZ MALDONADO, )Defendants. )

MR. MARTNEZ'S MEMORANDUM IN AID OF SENTENCING

To assist the Court in preparing for Mr. Martnez's sentencing on February 29, 2012, Mr.

Martnez submits this Memorandum in Aid of Sentencing. 1

I. MR. MARTNEZ'S HISTORY AND CHARACTERISTICS WARRANT AMINIMAL SENTENCE

Pursuant to 18 U.S.C. Section 3553(a), the Court should "impose a sentence sufficient,

but not greater than necessary," to serve the ends of justice, considering among other things "the

history and characteristics of the defendant." It is important not only that the punishment fit the

crime, but that the punishment also fit the defendant. As the Supreme Court recently explained:

"It has been uniform and constant in the federal judicial tradition for the sentencing judge to

consider every convicted person as an individual and every case as a unique study in the human

failings that sometimes mitigate, sometimes magnify, the crime and punishment to ensue."

1 To the extent that the Court intends to rely upon the Presentence Report (PSR) in thiscase, Mr. Martnez asks that the Court consider his objections to the report. (Ex. A (filed underseal because the PSR itself is confidential).) The PSR is deeply flawed -- more so, perhaps, thanany PSR defense counsel ever has encountered -- and almost no effort was made by Probation torespond to Mr. Martnez's objections.

Case 3:10-cr-00232-FAB Document 601 Filed 02/16/12 Page 1 of 24


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Pepper v. United States, 131 S. Ct. 1229, 1240 (2011) (Sotomayor, J.) (internal quotation

omitted); see id. ("For the determination of sentences, justice generally requires consideration of

more than the particular acts by which the crime was committed and that there be taken into

account the circumstances of the offense together with the character and propensities of the

offender.") (internal quotation omitted).

Although there is room to debate Mr. Martnez's guilt or innocence, there should be no

debate about the fact that he is a man of extraordinary character. He worked his way through

law school but, rather than pursue a financially lucrative career in the private sector, Mr.

Martnez chose to follow his father's path of public service by becoming a Senator. As the Court

is well-aware, even now, Mr. Martnez continues to be held in high-esteem by the President of

the Senate and his fellow Senators who do know his character and who have witnessed his

dedication to the public good.

Mr. Martnez has shown the same dedication to his family. His mother is 77 years old,

and Mr. Martnez lives with her and takes care of her. Some who are close to him believe that he

has placed his own life on hold, not having married or pursued a family of his own, because of

his sense of devotion to his mother. This sort of selflessness is rare. And in a very real sense,

the one who will suffer the most by Mr. Martnez's incarceration would be his mother, who has

come to depend on him in her twilight years.

The PSR is replete with interviews of many people who are close to Mr. Martnez and

who portray a sense of him that helps place the events alleged in the Indictment in context.

Many of them describe Mr. Martnez as a good and trusting man, who can be somewhat nave

when it comes to the intentions of others or how events may be perceived. (PSR 112, 114,

117, 118, 120-22.) Although in hind-sight, Mr. Martnez can be faulted for not appreciating that



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it may look bad to go on a trip with someone who had sought his assistance in passing

legislation, Mr. Martnez believed this was just a guys' trip to Las Vegas for the weekend and

nothing more and, perhaps navely, he trusted that everyone would see the trip for what it was.

To his credit, Mr. Martnez had no reason to believe that anyone would question his

motives for supporting the legislation, which was not controversial and passed the Senate

without any meaningful opposition. The escalation of violent crimes in shopping centers was an

issue that had generated considerable media attention, and Mr. Martnez had the support of the

shopping centers and law enforcement in getting the shopping centers bill passed. Similarly, the

problems in the private detective industry had been well documented, ranging from a failure to

pay taxes to abusing workers by forcing them to work for improper wages and under unfair

conditions. The private detective reform bill also had the support of law enforcement. Neither

bill was of the sort that anyone would have needed any special assistance to pass.

Nor is this a typical public corruption case. This is not a matter where a public official,

like Jorge De Castro Font, made hundreds of thousands of dollars by extorting money from

citizens. Nor is it a case where a public official traded government business for bribes, such as

Congressman Randy "Duke" Cunningham who obtained millions in bribes by steering

government contracts to his supporters.

This case involves a single trip to Las Vegas, where the benefit that Mr. Martnez

received was at best a few thousand dollars. Experience teaches us that no politician sells

himself that cheaply. Here, Mr. Martnez had merely reconnected with Juan Bravo, a man he

knew from his neighborhood as a child. They had similar backgrounds and having worked

together to pass legislation that both of them supported, their friendship advanced during the trip

to Las Vegas and has continued to the present day. Yet, Mr. Bravo never again asked Mr.



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Martnez for his assistance with any other legislation. And again, experience teaches that when

someone goes in search of a public official who is for sale and finds one, they continue to push

for more and more improper favors. The fact that did not happen here is telling.

Plainly, Mr. Martnez does not fit the mold of what we have come to associate with the

image of a corrupt public official and he is not in the "heartland" of typical corruption cases.

Even if the Court is to credit the validity of his conviction at sentencing (which Mr. Martnez

plans to vigorously appeal), the conviction would at worst reflect a momentary lapse in judgment

in which meritorious legislation was supported and Mr. Martnez's benefit was limited. Mr.

Martnez has not even been charged with any other criminal conduct in the more than five years

since the Las Vegas trip took place.

To be sure, if what Mr. Martnez did was a crime, it deserves to be punished. But the

punishment should fit the crime as well as the offender. This would be a first-time offense for

Mr. Martnez, and it involves conduct that has not been repeated in the subsequent five years.

Consequently, a harsh sentence is not needed to "afford adequate deterrence to criminal conduct"

or "to protect the public from further crimes of the defendant." 18 U.S.C. 3553(a)(2)(B) &

(C). Even the Sentencing Commission has observed that first-time offenders pose little risk of

recidivism and that this may provide a basis for a sentence reduction. U.S.S.C., Measuring

Recidivism: The Criminal History Computation of the Federal Sentencing Guidelines at 15

(2004); see also id. at 16 and 29 (noting that when a person of Mr. Martnez's age and

educational level are considered in conjunction with first-time offender status, the rate of

recidivism is negligible).

Moreover, the Court also should consider that Mr. Martnez has been thoroughly

punished already. As a result of his conviction, Mr. Martnez had to resign from the Senate and



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he may lose his license to practice law. These sorts of collateral consequences to a conviction

should be considered in imposing an appropriate penalty. See, e.g., United States v. Wachowiak,

412 F. Supp. 2d 958, 963 (E.D. Wisc. 2006) (reducing sentence based on the conviction

requiring the defendant to resign as a church music teacher and ruined his career in teaching);

United States v. Samaras, 390 F. Supp. 2d 8065, 809 (E.D. Wisc. 2005) (reducing sentence based

on loss of public sector employment). Not only should such factors be considered because they

are punitive, but they also are relevant where, as here, they effectively prevent the crime from

being repeated. See, e.g., United States v. Gaind, 829 F. Supp. 669, 671 (S.D.N.Y.), aff'd 31

F.3d 73 (2d Cir. 1994) (reducing sentence because the conviction destroyed the defendant's

business, making a repeat of his business crime impossible). Having lost his position as a

Senator, Mr. Martnez is incapable of committing any sort of crime involving political corruption

and the fact that he lost his Senate seat is a powerful deterrent to other elected officials.

In considering what is "sufficient, but not greater than necessary," to deter crime by

others, the Court should be mindful of the limited role that the threat of incarceration plays in the

deterrence of white collar offenders. There is now a significant body of evidence that finds "no

significant difference in recidivism between white-collar offenders sentenced to prison and

similar offenders who did not receive a prison sentence," and those findings are consistent across

criminological studies dating back to the 1970s. See Elizabeth Szockyj, Imprisoning White

Collar Criminals?, 23 S. Ill. L. J. 485, 495 (1999). Indeed, there are no differences in recidivism

rates between white collar offenders sentenced to jail and those sentenced to probation. See

David Weisburd et al., Specific Deterrence in a Sample of Offenders Convicted of White-Collar

Crimes, 33 Criminology 587 (1995). Rather than longer sentences, it appears to be "the criminal

process itself -- charge, trial, conviction, and sentencing -- [that] has the greatest impact on the



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offender, and the period of imprisonment adds little by way of deterrence." Szockyj, supra, at

495; see, e.g., John Braithwaite, Crime, Shame and Reintegration 69 (1989) ("It would seem that

sanctions imposed by relatives, friends or a personally relevant collectivity have more effect on

criminal behavior than sanctions imposed by a remote legal authority.").

These factors are particularly acute among public officials. Those who seek public office

are a rare breed. Their desire to hold public office typically means that they must forego more

lucrative employment in the public sector, they often work longer hours, and virtually every one

who campaigns for public office complains that waging such a campaign (particularly in our

negative campaign climate) is exhausting and that they detest soliciting campaign contributions

necessary to keep their campaigns viable. Yet, they make these sacrifices because -- for

whatever reason, noble or not -- public officials highly value the office they obtain. For those in

public office, like Mr. Martnez was, his tale involves the ultimate sanction -- the loss of his seat

in the Senate and the shame of a conviction. That is what will deter misconduct by public

officials in Puerto Rico. A lengthy prison sentence would not do more, it would simply be a

"greater than necessary" penalty imposed for the sake of being punitive.

II. GUIDELINE CALCULATION

The Guidelines apply either Guideline 2C1.1 (bribery) or Guideline 2C1.2 (gratuities) to

a conviction under 18 U.S.C. 666, depending on what type of offense was proven at trial.

U.S.S.G., App. A. See, e.g., United States v. Anderson, 517 F.3d 953, 961 (7th Cir. 2008)

("Convictions under 666 . . . call for the application of either 2C1.1 or 1C1.2, whichever is



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more appropriate or most specifically covers the offense conduct.").2 This is not debatable, it is

plain, black-letter law. Nevertheless, the PSR inexplicably applied Guideline 2C1.1, without

even acknowledging that Section 2C1.2 may be applicable to offenses under 18 U.S.C. 666.

(Dkt. 594 95.) Moreover, in response to Mr. Martnez's objection that a choice must be made as

to whether to apply Guideline 2C1.1 or Guideline 2C1.2 and his analysis that Guideline 2C1.2 is

more appropriate based on the facts of this case, Probation simply responded that the applicable

Guideline "is found in section 2C1.1 of the guidelines." (Dkt. 595 at 2.) Again, Probation

completely failed to acknowledge that the Guidelines themselves specifically require a choice to

be made between Guideline 2C1.1 and Guideline 2C1.2, based on the facts of the case, and

Probation made no effort whatsoever to argue that the facts of this case made Guideline 2C1.1

more appropriate.

A. Guideline 2C1.2 Is Applicable

There should be little debate in this case that the Gratuity Guideline of Section 2C1.2 is

more applicable. In deciding whether to apply the Bribery Guideline or Gratuity Guideline to a

2 Paragraph 94 of the PSR claims the 2011 edition of the Sentencing Guidelines applies toconduct it acknowledges was complete by May 2005, at the latest. The Sentencing Guidelinesthemselves direct Courts to apply the Guidelines in effect at the time of the alleged conduct,rather than at the time of sentencing, when they are more lenient to avoid Ex Post Facto Clauseconcerns. U.S.S.G. 1B1.11(b)(1) (2011). Like the Guidelines, the First Circuit explains; "Wetoo tell judges to use the old version if the new one raises ex post fact concerns. Reduced toessentials, our set protocol runs this way: '[W]e ordinarily employ the [G]uidelines in effect atsentencing only where they are as lenient as those in effect at the time of the offense; when the[G]uidelines have been made more severe in the interim, the version at the time of the crime isnormally used. . . .'" United States v. Rodriguez, 630 F.3d 39, 42 (1st Cir. 2010) (quoting UnitedStates v. Maldonado, 242 F.3d 1, 5 (1st Cir. 2001)). Accordingly, the Court should calculate theGuidelines under both the current and 2004 version and apply whichever version is morefavorable to Mr. Martnez. This may make a difference if the Court were to apply an obstructionof justice enhancement, among other things.



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Section 666 case, the Eight Circuit explained: "The distinction between a bribe and an illegal

gratuity is the corrupt intent of the person giving the bribe to receive a quid pro quo, something

that the recipient would not otherwise done." United States v. Griffin, 154 F.3d 762, 763 (8th

Cir. 1998) (citing United States v. Mariano, 983 F.2d 1150, 1159 (1st Cir. 1993)). In contrast to

the Bribery Guideline, the First Circuit explains that "the gratuity guideline presumes a situation

in which the offender gives the gift without any strings, intending it instead as a reward for

actions the public official has already taken or is already committed to take." Mariano, 983 F.2d

at 1159. As the Third Circuit explained, "accepting payment for something a public official was

already planning to do or already had done is a gratuity (or 'reward') and not a bribe." United

States v. Bryant, 655 F.3d 232, 244 (3d Cir. 2011).

In this case, the jury was left with the possibility of a bribery conviction under Puerto

Rico law or a gratuity conviction under Section 666. As the Court instructed the jury concerning

the Travel Act charge in Count 5 that is predicated upon a violation of Puerto Rico's bribery

laws: "It is a crime in Puerto Rico for a public official to ask for or accept money or any benefit

in exchange for performing an official act, and it is a crime in Puerto Rico to give or promise to

give a public officer money or any benefit in exchange for the public officer performing an

official act." (3/4/11 Tr. at 23-24.) The jury rejected the charge that Mr. Martnez violated the

Puerto Rico bribery laws by trading the trip to Las Vegas "in exchange for" his support for the

legislation.

By contrast with the "in exchange for" bribery language of the Puerto Rico law, the Court

instructed as to the Section 666 count that the jury need only find that Mr. Martnez accepted the

trip and "intended to be influenced or rewarded." (3/4/11 Tr. at 28.) The words "reward" or

"rewarded" are used 20 times in the jury instructions. As then-Judge Sotomayor explained, the



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word "reward" implies a "gratuity theory." United States v. Ganim, 510 F.3d 134, 151 (2d Cir.

2007). The First Circuit agrees: "As the word 'gratuities' implies, the intent most often

associated with the offense is the intent to 'reward' an official for an act taken in the past or to be

taken in the future." United States v. Sawyer, 85 F.3d 713, 730 (1st Cir. 1996); see also United

States v. Woodward, 149 F.3d 46, 67 (1st Cir. 1998) ("gratuities was the reward"). As the

Second Circuit recently explained, "what distinguishes bribery from gratuities" is that "an illegal

gratuity 'may constitute merely a reward for some future act that the public official will take (and

may already have determined to take), or for a past act that he has already taken.'" United States

v. Bahel, 662 F.3d 610, 635 (2d Cir. 2011) (quoting United States v. Sun-Diamond Growers of

California, 526 U.S. 398, 401 (1999)). Bahel recognized that Section 666 holds a cause of action

for bribery where the gift is made "in exchange for" an official act and is made to "influence" an

official, but contains a separate cause of action for gratuities where the gift is made as a

"reward." Id. at 636-37.

The Court's jury instructions permitted the jury to convict Mr. Martnez under Section

666 through a gratuity theory by finding that he accepted the trip to Las Vegas as a "reward" for

his support for the legislation that Mr. Bravo favored, even if the jury did not think that the trip

was made "in exchange for" that support. The Court made this particularly clear by crafting a

unique instruction that told the jury it could convict Mr. Martnez even if he had not "accepted,

or agreed to accept" the trip until "after" he had decided to take the official action. (3/4/11 Tr. at

29.) Obviously, if Mr. Martnez did not agree to accept the trip until "after" he already had

agreed to support the legislation, agreeing to accept a subsequent trip could not have been in

exchange for his previous decision to support the legislation. In reinforcing the gratuity theory

further, the Court also made clear that no sort of bargained for exchange was required to convict,



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because the jury could convict even if the gift did not cause "Martnez to change his actions or

course of conduct regarding Senate Project 410 and/or 471." (Id. at 31.) Rather the Court

instructed that crime was complete if Mr. Martnez accepted the trip with the intent to be

"rewarded for maintaining a position already adopted in reference to Senate Projects 410 and/or

471 before the Las Vegas trip was given, offered, or agreed to be given." (Id. at 31.)

The government relied heavily upon these jury instructions to argue that no quid pro quo

was required to convict. The government told the jury that Mr. Martnez's claim that he

supported the proposed legislation for good reasons was irrelevant because the issue was "[n]ot

why Juan Bravo and Hector Martnez supported the legislation." (3/4/11 Tr. at 177.) Instead of

acknowledging a need to prove a quid pro quo, where the legislation was supported in exchange

for and because of an improper payment, the government told the jury to consider only why Mr.

Martnez accepted the trip "at the same time" he was helping Mr. Bravo get the bills passed.

(Id.) The government emphasized the "reward" language ten times and, rather than emphasize a

causal relationship between the payment and the support, it emphasized only the need for a

"connection" between them. (Id.; id. at 179, 180, 182 ("connected"), id. at 180 ("[W]hen Hector

Martnez accepted the free trip from Juan Bravo, he accepted it, knowing that it was offered to

influence or reward him for his conduct related to 410 and 471").); id. at 185 ("even if just part of

[the defendants' intent] was to influence or reward"); id. at 186 ("if part of the motive was to

influence or reward"); id. at 188 ("offered with the intent to influence or reward".). The

government also told the jury that "it doesn't matter when it was offered or when it was accepted.

. . . These instructions clarify that -- that it doesn't matter if the trip was offered before official

acts were taken, at the same time official acts were taken, or after official acts were taken,

because the crime is offering or accepting the trip with the intent to influence or reward." (Id. at



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183.) The evidence strongly suggests that Mr. Martnez was committed to supporting the

proposed legislation before he ever was invited on any trip, such that the jury must have relied

upon the "reward" theory that the trip was a gratuity.

In this case, there is no real question that Mr. Martnez agreed to support the legislation

before any trip was offered or accepted. The jury could not have found that the trip was made in

exchange for his support, "something that the recipient would not otherwise done," Griffin, 154

F.3d at 763, but was instead a showing of gratitude by Mr. Bravo for Mr. Martnez 's support.

The fact that the jury convicted under Section 666, where this "reward"-based gratuity theory

exists, but acquitted under the Puerto Rico bribery laws "in exchange for" requirement,

demonstrates that the conviction under Section 666 was for a gratuity offense.

By applying the Gratuity Guideline, Section 2C1.2, Mr. Martnez calculates his Guideline

total offense level as follows:

Base Offense: 11 (public official)

High-Level Position: + 4

Total Offense Level: 15 (18-24 months)3

B. Probation Miscalculated Its Application Of Guideline 2C1.1

In addition to applying the wrong Guideline, the PSR miscalculated the total offense level

under that Guideline.

3 Unlike the Bribery Guideline, which has an enhancement for the value of the bribe or thevalue of the benefit received in exchange for the bribe, the Gratuity Guideline's enhancement islimited to the value of the gratuity. Because the value of the alleged gratuity received by Mr.Martnez was less than $5,000, there is no enhancement. U.S.S.G. 2C1.2(b)(2).



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1. Amount of Loss

The PSR errs by applying a 14-level enhancement based on the intended loss being more

than $400,000. But Probation's analysis of the intended loss is so flawed that it cannot even

calculate the same intended loss figure the same way twice -- it has somehow managed to

estimate the intended loss differently for Mr. Bravo and Mr. Martnez even though they were

convicted of the same crime. Although Mr. Martnez provided extensive objections to the PSR's

loss calculation and Probation responded with an addendum containing the heading "b)

Applicable Guidelines & Loss Calculation" (Dkt. 595 at 2), Probation offered no defense to its

loss calculation methodology under that heading or anywhere else.

Initially, Probation explained that it calculates "the benefit a person in the defendant's

position at the time of the extortion would reasonably have expected the victim to receive by

paying him the money he demanded." (Dkt. 596 96 n.3.) After Mr. Martnez objected that

there never been any suggestion by the prosecutors, Mr. Bravo, or anyone else that Mr. Martnez

engaged in "extortion," and there certainly was no evidence at trial to suggest that he engaged in

extortion, the government changed this language in the revised PSR, yet kept the loss calculation

the same.

The PSR concludes that the amount of loss would be the loss of net income to Loomis of

$440,856 because that was its net income in 2004 and, if Project 471 had passed, "Loomis Fargo

would have lost the net income because they would have not been able to operate and would

have had to close their business." That simply is not true, and there is no credible evidence to

support that conclusion.

The PSR improperly claims there was a meeting at Ranger American in 2005 to propose

amending the private detective law to "eliminate competition" through legislation that "would



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eliminate several of Ranger American's competitors." (Dkt. 594 40.) There is no evidence to

suggest that Mr. Martnez attended this meeting or knew of its alleged purpose.

Moreover, the claim is inaccurate and misleading. The purpose of the meeting was not to

eliminate competition, but to protect the industry and all who worked in it by holding everyone

to the same minimum standards. The problem for companies, like Ranger American, that

complied with the law, was that their competitors were breaking the law and that was casting the

whole industry in a negative light. (2/21/11 Tr. at 34 (less than 1/4 of the companies complied

with the law).) The problems with security companies not paying taxes, abusing their

employees, and there being no one for the government to hold accountable led to the legislation

being supported by the Puerto Rico Department of Justice and Chamber of Commerce. (2/28/11

Tr. at 71; see 2/18/11 tr. at 43 (quoting the statute as having its purpose "to prevent unscrupulous

individuals from giving those services without complying with applicable laws").) The

legislation would not have eliminated any competitors, it merely would have required those

competitors who were not in compliance with the law to come into compliance. Importantly, the

evidence both at trial and that emerged subsequently confirmed that this legislation would not

eliminate competition.4

4 The PSR wildly distorts Mr. Portilla's testimony to support its claims. The PSR claims itwas Mr. Portilla's testimony that, with the proposed legislation, Brinks, Loomis and other non-complying companies "would have been forces to close down, which would have financially

benefitted Bravo." (Dkt. 594 76.) That is not what he said. Rather, he testified that "what wewanted was the companies not complying with the law, start to comply with the laws as we did,in order to have an even level competition, or simply if they cannot comply, well, they wouldhave to be deleted and closed down." (2/21/11 Tr. at 36.) He testified that it would be easyenough for non-complying companies to get a license and then be able to continue to compete,and that he would have no objection to that sort of fair competition. (Id. at 64-65.)



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The government claimed that the legislation would have required the CEO of a private

security firm to be a licensed private investigator, that such licenses can only be issued to Puerto

Rico residents, and that competitors with non-resident CEOs would be put out of business. This

requirement, however, already was part of the existing law. The proposed legislation merely

would have made that requirement more explicit. (2/28/11 Tr. at 96 (Velazquez).) Because

Loomis was not in compliance with the existing law in this respect, Nestor Medina who ran

Loomis testified that Loomis lost its license on January 27, 2010 due to a ruling by the Puerto

Rico Court of First Instance. (2/22/11 Tr. at 197.) Despite the loss of the license, Mr. Medina

testified that Loomis did not close down, lose any business or even "lose one penny." (2/22/11

Tr. at 197.) The reason for that is that after Loomis' license was revoked, Loomis then chose to

comply with the law and obtained a new license -- as the government itself acknowledged (Id. at

144-45) and its witness from Loomis did too (Id. at 149).

When Loomis lost its license for failure to comply with that requirement in the existing

law, it simply chose to comply with the law and quickly obtained a new license in 12 days,

without losing any business and, as Loomis' witness testified, it did not "lose one penny."

(2/22/11 Tr. at 197.) Although Mr. Medina seemed to think Project 471 would have imposed a

requirement on the CEO of its parent company in Europe, Mr. Medina is not a lawyer, he had no

basis of support for that opinion, and none exists in the language of the bill. This conclusion was

just Mr. Medina's "understanding" of what the bill would require, but he could not provide any

basis in the bill's language or elsewhere to support that "understanding." (2/21/11 Tr. at 154,

192-194.) There plainly is nothing in the law that would preclude foreign companies from

entering the market so long as they have a licensed CEO. Moreover, Mr. Medina could not

provide any basis for his inexpert opinion. Even Mr. Medina ultimately agreed that a foreign



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company could do business in Puerto Rico under the proposed legislation, if it simply got a

licensed CEO to head the company. (Id. at 194.) When a court held that Loomis was violating

the law, Mr. Medina testified that it hired a CEO with a license and that solved the problem

without any loss of business. (Id. at 197-98.) Casting further doubt on Mr. Medina's credibility,

the Court of Appeals of Puerto Rico found that Loomis -- while being headed by Mr. Medina --

acted in an "illegal or fraudulent manner" in obtaining in claiming that a licensed truck driver

was its CEO. (Dkt. 584-1 at 8.) Consequently, it would be an astounding error to allow Mr.

Medina's inexpert legal opinion to serve at the lynch-pin for a 14-level Guideline enhancement.

In addition, the Puerto Rico Court of Appeals decision, seven months ago, removed all

doubt that the requirement Project 471 sought to clarify already existed in the current law.

Moreover, the Court of Appeals construed virtually the same language as would have been added

by Project 471 to require only that the head person in Puerto Rico, rather than the head of a

parent company, have the private detectives license. (Dkt. 584-1 at 6.) At trial, the testimony

was that 75% or more of the private security companies in Puerto Rico were not in compliance

with the law as set forth by the Court of Appeals decision. (2/21/11 Tr. at 34.) Now that such a

requirement is clear, it does not appear that any of these companies have been forced to close

down, have lost business or that Ranger American has either become a monopoly or even gained

market share as a result. Consequently, there is no credible basis for the Paragraph to conclude

that such a legal requirement would cause Loomis to "close their business." This is not

surprising. Successful businesses adapt when they face a hurdle, they don't just fold, and

choosing to comply with Puerto Rico law is not difficult.

Moreover, the PSR makes an additional speculative leap in concluding that Loomis'

closing would transfer Loomis' net profits to Ranger American, making it "the benefit received



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or to be received in return for the payment." U.S.S.G. 2C1.1(b)(2). If Loomis did go out of

business, there would be competition for that business by existing competitors -- in addition to

Ranger American -- and new competitors would likely enter the market. The Probation Office

has no way of guessing who would be awarded any contracts that may come into play in the

highly unlikely event that Loomis would have simply walked away from the market, rather than

take the minimal steps necessary to comply with the law.

In addition, there is no reason to speculate as to what would happen to other competitors

if Puerto Rico law became clear that to obtain a license for a private security company, the CEO

of such company must be a licensed private investigator. Any doubt about whether the existing

Puerto Rico law imposed such a requirement was removed when the Puerto Rico Court of

Appeals affirmed the judgment against Loomis, and recognized that such a requirement was

imposed by the existing law on June 30, 2011. (Dkt. 584.) Since that time, our understanding is

that not a single company has gone out of business and that Ranger American has not seen any

spike in business. The Court of Appeals decision provided clarity as to the existence of this

requirement, just as the proposed legislation would have done. Yet, none of the dire

consequences of monopolization by Ranger American that the government speculated would

occur has occurred.

The PSR's loss calculation depends entirely on the assumptions that (1) Project 471

would have put Loomis out of business, when the evidence establishes that Loomis would have

just come into compliance with the law; and (2) that all of Loomis' business would have then

been transferred to Ranger American, rather than another complying security company that then

existed or new competitors that would have been enticed to enter the market in Loomis' absence.

When presented with a similarly speculative loss assessment, Judge Huvelle -- who is highly



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respected for her expertise in criminal matters -- rejected that methodology because it is not

reliable. United States v. Ring, 2011 WL 4360005, at *14 (D.D.C. Sept. 20, 2011). "The

government 'bears the burden of supporting its loss calculation with reliable and specific

evidence.'" Id. at 11 (quoting United States v. Gupta, 463 F.3d 1182, 1200 (11th Cir. 2006)). No

such reliable and specific evidence exists here, just the inexpert gut opinion of Mr. Medina who

could not provide any basis for his conclusion and his conclusion was rejected in essence by the

Court of Appeals. A court "may not simply guess where such evidence is unavailable." Ring,

2011 WL 4360005, at 16; see also United States v. Griffin, 324 F.3d 330, 365-67 (5th Cir. 2003)

(reversing bribery sentence based on inflated loss calculation).

The Bribery Guideline also contemplates that these types of situations where calculating

the net benefit of a bribery scheme cannot be made and it provides that, in situations "in which

the value of the benefit cannot be determined, the value of the bribe is used because it is likely

that the payor of such a bribe expected something in return that would be worth more than the

value of the bribe." U.S.S.G., 2C1.1, Background; see United States v. Frega, 179 F.3d 793,

812 (9th Cir. 1999) (upholding loss calculation in bribery case based on amount of bribes paid

where loss otherwise would be too difficult to calculate). Because the value of the allegedly

improper payments to Mr. Martnez were below $5,000, there would be no enhancement for the

amount of loss. See also Ring, 2011 WL 4360005, at *16 (measure the value of the bribe by the

"value to the recipient of the bribe") (emphasis in original).

2. Obstruction of Justice

The PSR also erroneously adds a 2-level enhancement for obstruction of justice based on

the grand jury testimony of Jorge De Castro Font -- which was so unbelievable that the

government refused to rely upon his testimony at trial or subject him to cross-examination -- and



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the trial testimony of Jose Velazquez -- even though Mr. Velazquez testified that no obstruction

took place and the jury acquitted Mr. Martnez of this charge. (Dkt. 594 100; Dkt. 595 at 2.)

After Mr. Martnez raised extensive objections to the enhancement, Probation made the

conclusory response -- with no analysis at all -- that an obstruction enhancement is warranted

based on the Velazquez and De Castro Font testimony. (Dkt. 595 at 3.)5 (The PSR makes a

number of other misguided allegations of wrongdoing against Mr. Martnez, which were

objected to, but the PSR does not claim an enhancement is warranted based upon them so they

are not addressed here.)

The Guidelines themselves caution that "the court should be cognizant that inaccurate

testimony or statements sometimes may result from confusion, mistake, or faulty memory and,

5 For the first time, Probation's addendum seeks to justify an obstruction enhancement based on Victor Rivera's testimony -- but no analysis is offered as to why. (Dkt. 595 at 3.) Noobstruction enhancement was sought in the initial PSR or the revised PSR, and it is procedurallyimproper for Probation under Federal Rule of Criminal Procedure 32 to raise the issue for thefirst time in an addendum to the PSR. (Dkt. 589 100; Dkt. 594 100.) Because an obstructionenhancement was not recommended in either PSR based on Mr. Rivera's testimony and thegovernment did not object to the PSR for failing to include such an enhancement, thegovernment has waived the argument under Rule 32(f)(1). See, e.g., United States v. Ventura,2011 WL 2600680, at * (D.C. Cir. July 1, 2011) (noting that the district court "properly acceptedthe PSR's findings of fact" because the defendant "failed to" object pursuant to Rule 32(f), and a"contrary holding would render Rule 32(f) a mere administrative request"); United States v.Archuleta, 348 Fed. Appx. 380, 382 (10th Cir. 2009) ("Additionally, the government and thedefendant are given a specific timeframe and procedure within which they must object to a PSR.If they fail to properly utilize this procedure, they forfeit their objections."). Complying with this

procedure is important to narrow the issues to be addressed at sentencing and to providesufficient notice of the relevant areas of dispute at sentencing. See, e.g., Irizarry v. UnitedStates, 553 U.S. 708, 716 & n.2 (2008); United States v. Perez-Ruiz, 421 F.3d 11, 17 (1st Cir.2005). In addition, the PSR does not offer any explanation for why Mr. Rivera's testimonyestablished obstruction of justice, which is a denial of basic due process, and Mr. Martnez didobject to much of the PSR's characterizations of his testimony and, even now, Probation does notrespond to those objections.



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thus, not all inaccurate testimony or statements necessarily reflect a willful attempt to obstruct

justice." U.S.S.G., 3C1.1, app. note 2 (2004). Even "making false statements, not under oath,

to law enforcement officers," including "providing a false name or identification document at

arrest," does not trigger the enhancement, unless it is a "materially false statement to a law

enforcement officer that significantly obstructed or impeded the official investigation or

prosecution of the instant offense." U.S.S.G, app. note 4(g) and 5(a) & (b); see also app. note 6

(defining "materiality" to include a "statement, or information, that if believed, would tend to

influence or affect the issue under determination").

The PSR makes no effort to explain how Mr. Martnez's alleged statements to Mr. De

Castro Font (the statements were not made) or Mr. Velazquez (the statements made were

truthful) would obstruct justice. None of these alleged statements were made by Mr. Martnez to

law enforcement officers and, even if Mr. De Castro Font or Mr. Velazquez had done as Mr.

Martnez allegedly requested, it would not have significantly obstructed or impeded the

investigation.

Jorge De Castro Font

It is astounding that the PSR seeks to impose an obstruction of justice enhancement based

on evidence that was never presented to the jury and is based on un-cross-examined grand jury

testimony of Mr. De Castro Font (a then cooperating government witness) who never testified at

trial. Mr. Martnez denies that he ever told Mr. De Castro Font to destroy boarding passes or

receipts or instructed him to do anything improper. Because Mr. Martnez never had an

opportunity to cross-examine Mr. De Castro Font, reliance upon his grand jury testimony to

prove anything would violate Mr. Martnez's rights under the Confrontation Clause of the Sixth

Amendment and Due Process Clause of the Fifth Amendment. It does not even appear that



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Probation interviewed Mr. De Castro Font concerning the alleged obstruction. Moreover, Mr.

De Castro Font has absolutely no credibility -- which is why neither the federal nor

Commonwealth prosecutors have relied upon his testimony at trial in any case. Mr. De Castro

Font is an admitted serial extortionist, has been caught in numerous lies with respect to his

conduct and the conduct of others (including to Probation and to this Court), had every reason to

say whatever he thought prosecutors wanted to hear to reduce his own sentence, and he plainly

was suffering from significant mental issues that led this Court to send him to a psychiatric

hospital. Consequently, there is no reason to believe that Mr. De Castro Font was mentally

competent to testify when he was before the grand jury and every reason to doubt his credibility,

even if he was mentally competent.

In response to Mr. Martnez's objections to Mr. De Castro Font's grand jury testimony,

Probation merely claims that it may include anything it wants in the PSR based on 18 U.S.C.

3661. (Dkt. 595 at 2.) That response is completely irresponsible. Probation never has provided

any explanation as to why it finds Mr. De Castro Font's testimony credible enough to be accepted

as true. And it knows better, Mr. De Castro Font repeatedly lied to Probation, the Court, had

every reason to lie in building a case against others to obtain leniency, and Probation is well

aware of his significant mental problems. For a Court to find this evidence credible enough to

impose an obstruction of justice enhancement, even under a preponderance of the evidence

standard, would be a clear invitation for reversible error. It has no place even being suggested in

a PSR.

Jose Velazquez

Nothing in the PSR concerning Mr. Velazquez could plausibly constitute obstruction of

justice, and the jury appropriately rejected this charge. Mr. Velazquez testified that Mr. Martnez



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told him of the investigation and that, if he should be questioned by the authorities, he should

"tell the truth and to recall that I was the one who had worked on the bills." (2/25/11 Tr. at 108-

09.) Mr. Velazquez testified extensively to having worked on the bills, testifying that "the truth

of it was that I had worked with the bills." (Id. at 109; see id. at 163 ("To say that I was the

person who worked on those bills, that was the truth.")). Mr. Velazquez also testified to having

worked on predecessor bills to amend Law 108, as far back as 1996 for other members of the

Puerto Rico legislature, that were similar to the bills introduced by Mr. Martnez. (2/28/11 Tr. at

8, 10, 19-20, 97-104, 107-110.).) Instructing a witness to tell the truth cannot constitute

obstruction of justice.

In addition, Mr. Martnez did not ask about the well being of Mr. Velazquez's son as "a

possible threat against his son," but to express an interest and concern for Mr. Velazquez's son --

a son who Mr. Martnez had recently helped. (2/25/11 Tr. at 157.) Mr. Velazquez did not

testify that this question about his son was threatening, but that Mr. Martnez asked about him

because Mr. Martnez used to work with his son in the Senate. (2/25/11 Tr. at 114.) Mr.

Velazquez testified that Mr. Martnez was never threatening toward him, and that he was kind,

gentle, generous and not vindictive, and he testified that Mr. Martnez asking about his son was a

caring thing to do. (Id. at 155, 157.)

C. Objection To Judicial Fact-Finding

Pursuant to the Supreme Court's decision in United States v. Booker, 543 U.S. 220

(2005), "under the Sixth Amendment, any fact that exposes a defendant to a greater potential

sentence must be found by a jury, not a judge, and established beyond a reasonable doubt, not

merely a preponderance of the evidence." United States v. Cunningham, 117 S. Ct. 856, 863-64

(2007). Booker held that it was unconstitutional to make the Sentencing Guidelines mandatory



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and that, instead, the legitimacy of a sentence is measured by whether the sentence is reasonable.

Nevertheless, because the reasonableness of a sentence depends upon the facts of the case, even

post-Booker, a sentence that rests heavily upon judicial fact-finding remains unconstitutional.

See, e.g., Gall v. United States, 128 S. Ct. 586, 602-03 (Scalia, J.) ("The door . . . remains open

for a defendant to demonstrate that his sentence, whether inside or outside the advisory

Guideline range, would not have been upheld but for the existence of a fact found by the

sentencing judge and not a jury."); Rita v. United States, 127 S. Ct. 2456, 2479 (2007) (Scalia, J.,

concurring) ("explaining that the Court's opinion "does not rule out as-applied Sixth Amendment

challenges to sentences that would not have been upheld as reasonable on the facts encompassed

by the jury verdict or guilty plea.").

The sentence recommended by the PSR would require fact-finding by the judge, under a

preponderance of the evidence standard rather than a beyond a reasonable doubt standard, which

would violate the Fifth and Sixth Amendments. Nearly half of the PSR's total offense level

depends on judicial fact-finding as to loss (14 levels) and obstruction of justice (2 levels). The

jury rejected the obstruction claim and even the prosecutor told the jury it did not need to find

that the legislation was designed to put Loomis out of business. (3/4/11 Tr. at 173 ("We're not

required to prove that Juan Bravo wanted to get Loomis out of business.").) Without those

judge-found enhancements, Mr. Martnez would face a total offense level of 18 under the

Bribery Guideline for a sentencing range of 27-33 months as opposed to the 151-188 months

recommended by the PSR. That is roughly a six-fold increase in the sentencing range based

solely on judge-found facts. Even with the statutory cap of 120-months in place, that is a three to

four-fold increase based solely on judge-found facts. It is difficult to imagine how a fact that



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would triple or quadruple an otherwise reasonable sentencing range would not qualify for an as-

applied Fifth and Sixth Amendment challenge, which Justice Scalia has made clear exists.

CONCLUSION

Based on the circumstances of this case, the ends of justice can be met without sentencing

Mr. Martnez to any period of incarceration.

______________/S/____________ ______________/S/___________________

Sonia I. Torres-Pabon Abbe David Lowell, Admitted pro hac viceMELENDEZ TORRES LAW PSC Christopher D. Man, Admitted pro hac viceMCS PLAZA, SUITE 715 CHADBOURNE & PARKE LLP255 Ponce De Leon Avenue 1200 New Hampshire Ave., N.W.San Juan, PR 00917 Washington, D.C. 20036(787) 281-8100 (Telephone) (202) 974-5608(787) 281-8300 (202) 974-6708

Counsel for Defendant, Hector Martnez



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CERTIFICATION OF SERVICE

I certify that on February 16, 2011, a copy of the foregoing was filed with the Court's

electronic case filing system, thereby effecting service pursuant to Local Civil Rule 5(b)(2) on

Peter M. Koski with the U.S. Departtment of Justice.

______________/S/____________

Christopher D. Man


memo martinez sentencia bravo martinez noticel

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