Woman waived challenge to amount of loss attributable to her conduct

Back to TopCommentsE-mailPrintBookmark and Share

The 7th Circuit Court of Appeals affirmed the 57-month sentence for a woman involved in a real estate fraud scheme, finding she waived the issue regarding the amount of loss attributable to her conduct.

Donella Locke was charged with 15 counts of illegal conduct, but 10 counts were dismissed upon Locke’s motion because the government couldn’t present any evidence on those counts. The presentence investigation report calculated a loss of more than $2.3 million based on all of the properties underlying all 15 counts against Locke, including those that formed the basis of the dismissed counts. She initially objected, but then her attorney withdrew the objection.

Locke was sentenced to 71 months and ordered to pay the full loss amount calculated in the report. She appealed, and the 7th Circuit remanded for resentencing. Before resentencing, she successfully petitioned for the government to not present any new evidence at the resentencing proceeding. Her sentence was reduced to 57 months because the court could not consider the enhancement for offenses involving 10 or more victims. Her restitution amount was reduced to approximately $340,000.

Locke appealed again, this time arguing the District Court erred when it failed to reduce the loss amount incurred as a result of her convicted conduct by the amount the victims received when they sold the real estate that secured the fraudulently obtained loans.

The 7th Circuit judges noted this case “takes on an unnecessarily complicated pallor by co-mingling the concepts of loss and restitution. … The confusion in this case comes from the fact that although Locke waived any right to ask the appellate court to reconsider the amount of loss, on remand, the district court was required to reconsider restitution.”

“Locke was free to preserve a challenge to the loss amount based on the fair market value of the collateral at the time of the first sentencing,” Judge Ilana Rovner wrote. “Instead, she made a tactical decision to withdraw any objection to the loss amount. Had Locke not withdrawn the objection, the court would have taken evidence regarding both the amount placed at risk, the fair market value of the collateral and relevant conduct in determining the amount of loss. By waiving the objection, the district court had no reason to consider either matter and no evidence was presented.”

“Although it is true the application notes to U.S.S. G. 2B1.1 instruct that loss amounts also should be offset by the collateral, the issue of loss had been waived. Had it not been waived, the district court could have considered the evidence about sale of the homes to determine the amount of offset of the collateral, but then the relevant conduct of the unconvicted counts would also have been fair game. Locke cannot argue that the court should have considered evidence to lower the amount of loss, but not to consider conduct that surely would have increased the amount of loss. That smacks of wanting to have one’s cake and eat it too.”

The case is United States of America v. Donella Locke, 11-3743.


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
Subscribe to Indiana Lawyer
  1. We do not have 10% of our population (which would mean about 32 million) incarcerated. It's closer to 2%.

  2. If a class action suit or other manner of retribution is possible, count me in. I have email and voicemail from the man. He colluded with opposing counsel, I am certain. My case was damaged so severely it nearly lost me everything and I am still paying dearly.

  3. There's probably a lot of blame that can be cast around for Indiana Tech's abysmal bar passage rate this last February. The folks who decided that Indiana, a state with roughly 16,000 to 18,000 attorneys, needs a fifth law school need to question the motives that drove their support of this project. Others, who have been "strong supporters" of the law school, should likewise ask themselves why they believe this institution should be supported. Is it because it fills some real need in the state? Or is it, instead, nothing more than a resume builder for those who teach there part-time? And others who make excuses for the students' poor performance, especially those who offer nothing more than conspiracy theories to back up their claims--who are they helping? What evidence do they have to support their posturing? Ultimately, though, like most everything in life, whether one succeeds or fails is entirely within one's own hands. At least one student from Indiana Tech proved this when he/she took and passed the February bar. A second Indiana Tech student proved this when they took the bar in another state and passed. As for the remaining 9 who took the bar and didn't pass (apparently, one of the students successfully appealed his/her original score), it's now up to them (and nobody else) to ensure that they pass on their second attempt. These folks should feel no shame; many currently successful practicing attorneys failed the bar exam on their first try. These same attorneys picked themselves up, dusted themselves off, and got back to the rigorous study needed to ensure they would pass on their second go 'round. This is what the Indiana Tech students who didn't pass the first time need to do. Of course, none of this answers such questions as whether Indiana Tech should be accredited by the ABA, whether the school should keep its doors open, or, most importantly, whether it should have even opened its doors in the first place. Those who promoted the idea of a fifth law school in Indiana need to do a lot of soul-searching regarding their decisions. These same people should never be allowed, again, to have a say about the future of legal education in this state or anywhere else. Indiana already has four law schools. That's probably one more than it really needs. But it's more than enough.

  4. This man Steve Hubbard goes on any online post or forum he can find and tries to push his company. He said court reporters would be obsolete a few years ago, yet here we are. How does he have time to search out every single post about court reporters and even spy in private court reporting forums if his company is so successful???? Dude, get a life. And back to what this post was about, I agree that some national firms cause a huge problem.

  5. rensselaer imdiana is doing same thing to children from the judge to attorney and dfs staff they need to be investigated as well