IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN ...epaper.indianagazette.com/docs/131023.defense...

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA

UNITED STATES OF AMERICA

V. DocketNo: 0315 2:13 CR00129-1

DANIEL PIKEL MEMORANDUM IN AID OF SENTENCING

Filed on behalf of: Daniel Pikel

Counsel of Record:

Robert J. Ridge, Esquire Pa I.D. No. 58651

CLARK HILL THORP REED, LLP One Oxford Centre 301 Grant Street, 14* Floor Pittsburgh, PA 15219-1425 (412) 394-2440

(01493927)

Case 2:13-cr-00129-TFM Document 20 Filed 10/14/13 of 22

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA

UNITED STATES OF AMERICA

V.

DocketNo.: 0315 2:13 CROO129-1

DANIEL PIKEL

MEMORANDUM IN AID OF SENTENCING

Before this Court comes Daniel Pikel for sentencing. He files this Memorandum in an

effort to aid this Court in determining a fair and appropriate sentence. This Sentencing

Memorandum will provide this Court with an insight into Mr. Pikel's life, and help the Court

formulate an appropriate sentence.

On June 5, 2013, Mr. Pikel waived indictment, and plead guilty to an Information

charging him with one count of Conspiracy to Commit Money Laundering in violation of 18

U.S.C. §371. To determine Mr. Pikel's sentence, the Court must consider certain factors

pursuant to 18 U.S.C. §3553(a). This Memorandum in Aid of Sentencing will explore the most

pertinent §3553(a) factors.

Mr. Pikel is a pillar of his commvmity. He was bom, raised and continues to live in

Home, PA. Mr. Pikel's generosity and willingness to help his community is equal to none,

according to members of his community. Although generosity and willingness to help is

considered by most to be a virtue, in fact, it was Mr. Pikel's undoing. He was pulled into this

fraudulent scheme by a fraudster, Lawrence Winckler\ Mr. Winckler, with the aid of his

'NO formal charges have been brought agamst Mr. Winckler yet.

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secretary, Cheryl Brooks, embezzled $10 million from their employer, Falcon Drilling^. While

Mr. Winckler profited the most from the scheme, Ms. Brooks also profited substantially. Mr.

Pikel has admitted aiding Mr. Winckler in the commission ofthis crime, but unlike the others, he

did not do it for greed. In fact, Mr. Pikel received a negligible amount of money for his

participation in the money laundering scheme. This Memorandum in Aid of Sentencing will

explain the circumstances under which Mr. Pikel's judgment failed, the culture of his

environment, how the scheme evolved, and Mr. Pikel's remorsefiilness. Mr. Pikel respectfully

requests that this Court depart fiom the Guidelines due to the fact that this case does not fall

within the heartland of a Conspiracy to Commit Money Laundering scheme. If no departure is

warranted, Mr. Pikel requests a variance from the Guidelines after consideration of 18 U.S.C.

§3553(a) factors.

On December 10, 2007, the Supreme Court ofthe United States in Gall v. United States.^

clarified the process by which a sentencing court determines a defendant's sentence. The

sentencing court must no longer decide whether the facts relevant to sentencing are

"extraordinary" in order to deliver a sentence outside the Sentencing Guidelines. Additionally,

the Court ruled that a sentence below the Guidelines is not presumed to be unreasonable. The

Court ruled that ifa sentencing judge opines that a defendant's conduct and the factors outlined

in 18 U.S.C. §3553(a) warrant a sentence below the Guidelines, that sentence is deemed

reasonable unless the judge has abused his discretion. No longer does the Court require

^ On January 23, 2013 Ms. Brooks plead guilty to one count of Conspiracy to Commit Mail Fraud; three counts of Mail Fraud in violation of 18 U.S.C. §1341 and 2 and three counts of Filing False Federal Income Tax Retums in violation of 26 U.S.C. 7206(1). Exhibit A.

^ 552 U.S. 38 (2007)

{01493927}


extraordinary circumstances or a computation of a rigid mathematical formula under the

"proportionality tesf before substantially deviating from the Guidelines.

The Court in Gall emphasized the importance ofa District Court judge's discretion when

it comes to sentencing. It reiterated that an "appellate review of a sentencing court's imposition

of a sentence is limited to determining whether the sentence is "reasonable". Appellate courts

"under a deferential abuse of discretion standard" will review the District Courts' determination

of "reasonableness"'*.

The Supreme Court has outlined the steps a sentencing court should take in deciding an

appropriate sentence. The Court stated that the sentencing court should:

(1) Calculate a defendant's Guidelines sentence;

(2) give both parties an opportunity to argue for whatever sentence they deem

appropriate;

(3) consider all of the §3553(a) factors to determine whether the factors

support the sentence requested by a party; and

(4) adequately explain the appropriateness of an unusually harsh or lenient

sentence .̂

In Gall, the Supreme Court stated that the sentencing court must make an "individualized

assessmenf of the sentence based on the facts presented, and "may not presume that the

Guidelines' range is reasonable"^. The Court fiirther stated that any sentence outside the

Guidelines is not to be presumed "unreasonable". In addition, consideration ofthe now advisory

Îd.

Îd.

Îd.

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Sentencing Guidelines is specifically required by §3553(a). Each factor set forth under §3553(a)

has equal weight. The Sentencing Guidelines must not be given any more weight than the other

factors. Therefore, if, after considering all of the Section 3553(a) factors this Court finds that

Mr. Pikel's conduct and circumstances warrant probation or home detention followed by a

probationary period, this Court is free to impose such a sentence. This Memorandum in Aid of

Sentencing will discuss each ofthe pertinent factors stated in §3553(a).

A. Nature and Circumstances of the Offense

1. Facts

Mr. Pikel met Larry Winckler in the late 1980's when Mr. Pikel was President ofthe Fire

Center, a volunteer fire department. Mr. Winckler lived near the fire station and frequented the

fire station until he ultimately became a volunteer fire fighter. Some years later, Mr. Winckler

became the secretary/treasurer of the fire department. Mr. Winckler was charming and well-

liked in the community. Through their volunteer work at the fire station, Mr. Pikel and Mr.

Winckler became personal friends.

At some point in the 1990's, Mr. Winckler was employed by Falcon Drilling. Falcon

Drilling is a major oil drilling company in Southwestern Pennsylvania. It owns drills and other

heavy equipment used in drilling oil wells. Mr. Pikel has owned an auto-body shop since 1984,

Universal Auto Repair ("Universal"). Universal did the auto-body repair work for Falcon

Drilling's truck fleet. In the early 2000's, Mr. Winckler approached Mr. Pikel, and suggested

that Mr. Pikel get into the business of sandblasting, painting and coating trucks and drilling

machinery. Mr. Winckler told Mr. Pikel that if Mr. Pikel were to engage in this business. Falcon

Drilling would be a good customer. Mr. Pikel thought it was a good business decision to open a

{01493927}


paint shop, and he engaged a contractor to build a garage large enough to paint the heavy

equipment. Mr. Pikel obtained a loan from Washington Mutual Bank in the amount of $75,000.

Trae to Winckler's word. Falcon Drilling became Pikel's major customer.

Mr. Winckler always portrayed himself as the owner or one of the owners of Falcon

Drilling. He carried with him the company's checkbook, and signed checks in front of Mr. Pikel

for work performed by Mr. Pikel on the company's fleet of tracks and equipment. Mr. Pikel

always assumed that Mr. Winckler owned Falcon Drilling or at least owned some interest.

Between 2008 and 2009, Mr. Winckler asked Mr. Pikel to "loan" him $30,000 in cash to

buy drill bits. He explained that he had the opportunity to buy the drill bits cheaper if he used

cash. Mr. Winckler was aware that Mr. Pikel kept thousands of dollars in cash in a safe due to

his gas station/convenience store business which processes many cash transactions. Mr. Pikel

reached into his safe and handed Mr. Winckler $30,000. Mr. Winckler promised to retum the

money the next day. Due to their friendship and Mr. Pikel's business practices, no written

agreement was signed. Mr. Winckler retumed the next day and wrote out a company check

addressed to Universal for the same amount he had borrowed from Mr. Pikel. A few days later,

Mr. Winckler retumed, and asked to borrow money again with the same excuse. Again, Mr.

Pikel handed Mr. Winckler cash and Mr. Winckler repaid him a few days later. After a few

transactions, Mr. Winckler then asked Mr. Pikel to falsify invoices by misrepresenting that

Falcon Drilling was purchasing drill bits from Universal. Universal did not sell bits. It was at

this point that Mr. Pikel understood that Mr. Winckler was doing something nefarious. Mr.

Pikel, though, tumed a blind eye, and agreed to provide the false invoices to Mr. Winckler

knowing that what he was doing was not within the bounds ofthe law.

{01493927}


Even though Mr. Pikel understood that he should not be providing false invoices, Mr.

Pikel was also apprehensive that if he did not continue to loan Mr. Winckler money, Mr.

Winckler might not continue to send Falcon's heavy machinery to be painted and coated at

Universal. In tum, Mr. Pikel would not be able to repay the bank loan. Mr. Pikel, though,

believed, until this investigation commenced, that Mr. Winckler was the owner of Falcon

Drilling or, at least, was a partial owner. Thus, much to Mr. Pikel's regret, he continued to

engage in these transactions for several years. Not once did he ask for compensation for loaning

Mr. Winckler money. On a few occasions, Mr. Winckler did give Mr. Pikel a couple of thousand

dollars for engaging in these transactions. Mr. Pikel never kept track of the amount of money

that Mr. Winckler gave him, because it was an insignificant amount.

Mr. Pikel gave Mr. Winckler $1.3 million worth of false invoices. Throughout this time,

though, Mr. Pikel continued to perform legitimate work for Falcon Drilling. It was not until the

beginning of this investigation that Mr. Pikel leamed that Mr. Winckler was not an owner of

Falcon Drilling. He also leamed that Mr. Winckler embezzled $10 million from Falcon Drilling.

2. The Prevailing Culture in Home, PA

In order for this Court to have a complete sense of Mr. Pikel's background, a description

of Home, PA- where Mr. Pikel was bom, raised, and continues to live- is necessary. Home, PA

is a raral village located in Indiana County, PA. It is one of eight small villages located in Rayne

Township, Indiana. There is no available data regarding the village of Home. The only data

available is that of Rayne Township which is the township that contains eight unincorporated

villages, including Home. There are 2,992 residents living in Rayne Township according to the

{01493927}


2010 U.S. Census.'' Only 31% ofthe population graduated from high school; 3.4% hold an

Associate's Degree from a college and 10.2% ofthe population holds a Bachelor's Degree.^

Home, PA's claim to fame is it being featured in one episode ofthe television show the

"X-files"^. The author ofthe X-files, Abbey Edwards, grew up in Home, PA and depicted Home

in this episode as the perfect little town resembling "Mayberry" in the television sitcom, "The

Andy Griffith Show". Much like the fictional Mayberry, the people in Home have unfettered

trast in their neighbors. Friends do favors for each other. There are no contracts signed just

merely handshakes. There are no formalities just a wink ofthe eye. Neighbors lend each other a

hand and the word "no" doesn't exist in their vocabulary. Mr. Pikel is a product of that

environment.

3. Mr. Pikel's Background

Mr. Pikel's highest level of education is 12* grade. He has been working at his father's

gas station since he was 5 years old. As his father became elderly, Mr. Pikel took over the

business and expanded it to include an auto body shop. In 2010, he purchased a restaurant/bar

just a couple of miles from the garage. Due to the nature of his businesses, Mr. Pikel took great

pride in knowing his customers and the residents of Home.

Mr. Pikel has an aduh daughter and one grandchild. They also live in Home, PA. His

daughter is the office manager for Pikel's businesses, and depends on Mr. Pikel for income.

^ http://factfmder2.census.gOv/faces/nav/jsfpages/community_facts.xhtml#none

'Id.

'http://en.wikipedia.org/wiki/Home,_Pennsylvania

7 {01493927}


4. Mr. Pikel's Character

Charitable good deeds should be considered when ascertaining the defendant's character

under §3553(a).^ Charitable activities as opposed to donating money for charitable causes are a

basis for departing from the Guidelines.^^ Mr. Pikel's character and lifetime of philanthropy is

demonstrated by the barrage of correspondence sent in by the community of Home, PA (Exhibit

B). Mr. Pikel's kindness and charitable work is evidence of his character, and thus should be

considered for variance under 3553(a). Due to the different levels of education among the

community in Home, PA, a myriad of different options were made available to the Home

community supporting Mr. Pikel. Despite their differences in education, they are real people

with real needs who have been touched by Dan Pikel.

A few people wrote letters, a few people answered a questionnaire and a few people are

willing to travel a few hours from Home, PA to Pittsburgh to testify on Mr. Pikel's behalf. Some

of these people have never traveled to Pittsburgh. The Court has wide discretion in determining

the types of evidence it may consider in sentencing.^^ The Supreme Court in Pepper v U.S.^^,

stated that "[hjighly relevant - if not essential - to [the] selection of an appropriate sentence is

the possession of the fullest information possible conceming the defendant's life and

characteristics." Additionally, 18 U.S.C. §3661 provides that:

"No limitation shall be placed on the information conceming the background, character, and conduct of a person convicted of an offense which a court of the United States may receive and consider for the purpose of imposing an appropriate sentence."

'" U.S. V Tomko. 562 F.3d 558 (3d Cir. 2009) (en banc).

'̂ U.S. V Serafmi. 233 F.3d 758, 776 (3d Cir. 2000).

'̂ Pepper V U.S.. 131 S.Ct. 1229 at 1236 (2011)

'̂ Id. citing WiUiams v New York. 337 U.S. 241,246-247

8 {01493927}


There are many examples of Mr. Pikel's helpfulness impacting favorably the lives of

those in Home. He not only donates money, but most importantly, he donates his time and

services directly to people in need. He helps people whether he has known them for a short

period oftime or for his entire life. (Exhibit B-land B-2)

Mr. Pikel has been a volunteer fireman and first responder for over 25 years. He has

volunteered thousands of hours of ttaining, fought numerous fires, responded to serious auto

accidents and raised funds to operate and improve the firehouse. His heroic works and

leadership is described by many in the attached correspondence, including fire victims who

have benefitted fiom his selflessness.

In addition, because he owned several businesses, Mr. Pikel also provided, and continues

to provide, free services goods to people in need. For instance, Mr. Edmund Lukehart recalls

Mr.. Pikel providing free towing when he was in need.(Exhibit B-2)

As mentioned earlier, Mr. Pikel always maintained approximately $30,000 in a safe in the

gasoline station. Mr. Pikel's generosity extends to loaning people money without charging them

interest or signing agreements. Mr. Lukehart described how Mr. Pikel provided him with a

"quick interest free loan" that helped Mr. Lukehart make payroll. Randy Corosu wrote, "When

I was commuting to Indiana University of PA, I bought gasoline there. Ifl was short of money I

could get gas on credit, no interest or due date, I could pay whenever I could. I know Dan has

extended this courtesy to many people over the years and even to this day. He does it for auto

repairs, gasoline, bread, or milk." (Exhibit B-3) Along with Messrs. Lukehart and Corosu, there

are numerous others who explained in Exhibit B how Mr. Pikel extended loans and credit,

interest free, to those in need.

{01493927}


Another resident of Home, PA who is grateful for Mr. Pikel, is Eric Peterman . Mr.

Peterman has been a longtime friend of Mr. Pikel. He frequently travels out of town due to his

job. Mr. Peterman's wife was diagnosed with cancer a few years ago. Due to Mr. Peterman's

travel schedule, he was unable to take his wife to doctors' appointments or look after her.

During those days that Mr. Peterman was unable to care for his wife, Mr. Pikel volunteered. It

gave Mr. Peterman peace of mind to know that his sick wife was being cared for.

Through Mr. Pikel's businesses, he brings commercial traffic to Home, PA and provides

jobs to people, even when he has no job openings for them. One example is James "JimBob"

Shank who is uneducated and suffering from alcoholism. A few years ago, Mr. Shank was

unemployed and homeless. Mr. Pikel employed him, gave him shelter and fed him. Because of

Mr. Pikel's generosity, Mr. Shank has successfully avoided being a burden to society. Mr.

Pikel's friend of 45 years, Jeff Fenton, stated, "Dan's businesses provide jobs and bring people

into the area." (Exhibit B-4) Additionally, Mr. William Coleman writes: "Dan gave me a job as

a mechanic when I was out of work. Dan loaned cars to people when their cars were broke

down so they could get home or go to work and never asked for a cent." (Exhibit B-5)

Mr. Pikel has organized and made large donations to different causes, particularly, when

it benefits a distressed person or family directly. For instance, Daniel Schurr, a friend of Mr.

Pikel's for 49 years, lost his son, Chris Schurr, to cancer. Prior to Chris' passing, Mr. Pikel

organized a fundraiser and donated his services to help Chris Schurr and his family cover

expenses. Daniel Schurr stated in his answers to the questionnaire: "My son (Chris) was able to

pay doctor bills, pharmacy bills, his last month's rent before moving back with his mother and I.

What was left, Chris got to enjoy a "road trip" to do some sightseeing before he passed away."

(Exhibit B-6) Mr. Pikel also organized fundraisers and donated food for the family of a 4 year

10 {01493927}


old child who died of cancer (Exhibit B-7 p.2); for families whose houses have bumed down

(Exhibit B-8); and for charities such as Make-a-Wish and the Susan B. Koman Cancer Society

(ExhibitB-9 andB-10).

The community of Home, PA relies on Mr. Pikel. A single mother, Doris Fike, wrote,

"When I need help, I feel comfortable to ask Dan and know he is willing and wants to help - and

not for anything in retum." (Exhibit B-11) Dorothy Anderson and Thomas Anderson express

their reliance on Mr. Pikel. They are an elderly couple who depend on Mr. Pikel to look out for

them and their house. Mr. Pikel has helped them sweep water out of their garage after a storm,

rescued the stranded couple after their car broke down, sent employees to their house to move

fumiture, helped Mr. Anderson descend a flight of stairs when he needed medical attention, and

made sure that Mrs. Anderson had gasoline to operate her U.S. Postal vehicle (before her

retirement) during the gasoline shortage, just to name a few acts.(Exhibit B-12) Another friend,

Vicki Coleman, described how Mr. Pikel has helped her through the years. She is disabled. She

states, "I do know, that as a disabled person, just as others who are disabled, would know that we

can call Dan, and he would be the first to offer help in any way that we would need. Just plain

and simple: he is there for you." (Exhibit B-13) Interestingly, Ms. Coleman attached an article

from years back that she saved describing the generosity and kindness that Mr. Pikel exhibited as

well as others at Pikel's Universal Auto, when a stranger's car broke down. A retired State

Trooper, Robert L. Riddle, described in his answers to the questionnaire, "He helped me at times,

he would plow my parking lot. He would never take any money. He always stopped to talk."

(Exhibit B-14) Pauline Riddle described how Mr. Pikel helped her cope with the murder ofher

daughter (Exhibit B-15) M. Edmund Lukehart wrote that "Putting Dan Pikel in jail will be a

hardship on the community." (B-2)

11 {01493927}


Mr. Pikel's elderly father lives in a nursing home. He is mentally fit but physically

infirm. Mr. Ptkel has always been close to his father, and visits him regularly to ensure that he

has proper care. Without Mr. Pike, his father's health will suffer.

The good deeds that Mr. Pikel has done are neither recent nor calculated to impact his

sentencing. Mr. Pikel has been helping people since he was a young adult. Some ofthe stories

contained in the letters submitted to this Court happened many years ago, others occurred

recently. Mr. Pikel did not perform these good deeds to impress the Court. Being kind to others

is simply at the core of Mr. Pikel. Kindness, although frequently considered a virtue, led Mr.

Pikel to his current predicament. Mr. Pikel's inability to say "no" to someone who asks him for

a favor, is the reasons he stands before the Court. He couldn't say no to the people who wrote

these letters, and unfortunately, he couldn't say no to Mr. Winckler either.

Being a volunteer fire fighter and first responder to accidents is not a trait that people

who are greedy possess. Lending his restaurant and absorbing the expenses of a fundraiser for

persons in need are not the actions of a greedy man. Loaning cars to strangers without accepting

payment because that stranger was stranded is not the act of a greedy person. Home, PA is a

small community and it depend on its few leaders. Dan Pikel is one of them. As one author of a

questionnaire eloquently wrote, "Very small community. If he goes to jail I can seriously see

this town falling apart." (Exhibit B-16)

Mr. Pikel's charitable works warrant departure or variance from the Guidelines. In

Serafini, supra, the sentencing court granted a three level departure from the Guidelines on the

basis that defendant's charitable works. At sentencing the defendant, Serafini, (similar to Mr.

Pikel) presented numerous letters describing the defendant's generosity with his time and money.

Several letters described how the "defendant extended himself to them in unique and meaningful

12 {01493927}


ways during times of serious need."^^ The Third Circuit affirmed the District Court's conclusion

that the "letters and testimony demonstrated that Serfini had distinguished himself, 'not by the

amount of money [he has] given, but by the amount oftime that [he has] devoted."'^ Serafini is a

pre-Booker/pre-Gall case.

5. Reasons for Mr. Pikel Committing this Crime

It was consistent with Mr. Pikel's willingness to please and be well-liked that he made

the grave mistake of accommodating his old friend, Mr. Winckler. Since Mr. Pikel believed that

Mr. Winckler was the owner or partial owner of Falcon Drilling, he assumed that Mr. Winckler

had authority to sign Falcon checks. At first, he believed that Mr. Winckler needed cash for his

business and he gladly obliged. However, once Mr. Winckler asked him to falsify invoices, he

knew that something was amiss. Mr. Pikel's conscience told him that he should not falsify

invoices. Unfortunately, he chose to ignore his conscience, and accommodate a good customer,

that he crossed the line into the criminal world.

Mr. Pikel never asked Mr. Winckler for compensation. Mr. Winckler, would, only on a

few occasions, give Mr. Pikel a few extra thousand dollars for his trouble. Mr. Pikel never kept

track of this amount. Mr. Pikel lives in a modest house. He drives a 1998 Ford van. He does

not wear expensive jewelry or go on exotic vacations. He lives a simple life taking care of his

businesses, his family and his community. When he donates his money directly to people in

need, he does it without expecting anything in retum. His motive for complying with Mr.

"Serafini at 773.

'̂ Id at 774.

13 {01493927}


Winckler's request was not greed, it was to demonstrate is helpfulness as well as retain a

customer whom he had relied upon to engage in a new business.

6. Cooperation with the Government -Mitigating factor in §3553

Mr. Pikel has been cooperative with the govemment throughout the investigation.

During the execution of the search warrant, Mr. Pikel was helpful to the agents. On June 6,

2012, Mr. Pikel agreed to meet with the AUSA Greg Melucci and agents from the IRS. He was

thoroughly debriefed on the case. Mr. Pikel truthfiilly explained in detail everything he knew

about Winckler's scheme. He aided the govemment in assembling the missing pieces ofits case

against Cheryl Brooks and Larry Winckler. The govemment agreed to file a §5K1.1 Motion for

Departure if it needed Mr. Pikel to testify against Mr. Winckler. However, as of the sentencing

date, the govemment is hopeful that it will not need to call Mr. Pikel for additional cooperation.

Knowing that Mr. Pikel will be a good cooperating witness against Mr. Winckler aids the

govemment in its prosecution. Therefore, Mr. Pikel's immediate willingness to aid the

govemment in prosecuting the trae mastermind ofthe scheme should not go unnoticed.

As part of the §3553(a) factors, the sentencing court must consider Mr. Pikel's

cooperation with the govemment despite the government's decision not to file a §5K1.1 motion.

The First Circuit held in U.S. v Landron-Class. 696 F.3d 62, (CAl, 2012), that "nothing in the

guidelines suggests that a court's discretion to consider all of a defendant's relevant conduct

under §3553(a) is constrained by the government's decision not to file a 5K1.1 motion.

Accordingly, we join our sister circuits in sensibly holding that, in determining the appropriate

sentence within the guidelines, or in varying from the guidelines, a sentencing court has

discretion to consider the defendant's cooperation with the govemment as a §3553(a) factor,

even ifthe govemment has not made a USSG §5K1.1 motion for a downward departure. United

14 {01493927}


states V Massev, 663 F.3d 852, 858 (6* Cir. 2011); United States v Leiskunas. 656 F.3d 732, 737

(7* Cir. 2011); U.S. v Fernandez, 443 F.3d 19, 33; (2"*̂ Cir. 2005) United States v. Doe, 398 F.3d

1254, 1260-61 (10* Cir. 2005); Hitchingson. et al.. Federal Sentencing Law and Practice

§5K1.1, cmt. 2n.3 (2012)."

Loss of employment

Mr. Pikel employs his daughter who has a 3 year old daughter. Incarcerating Mr. Pikel

would have a substantial effect on Mr. Pikel's businesses causing the loss of jobs to several

innocent employees. According to the Court in U.S. v Miklovesky, 65 F3d 4, (2d Cir. 1995) in

deciding whether to grant a downward departure, it is proper for the court to consider "the

impact that the loss of his daily involvement would have on [the defendant's] business and,

consequently, on his employees."^*'

B. The Need for Sentencing

1. Seriousness ofthe Offense, promote respect for the law and provide just

punishment

Conspiracy to commit Money Laundering is a serious crime. However, it is not a violent

crime. In addition, it was Mr. Winckler who devised the scheme. It was Mr. Winckler who

influenced Mr. Pikel in joining him in this activity. It was Mr. Winckler who benefitted from

this activity. Mr. Pikel's role in the overall scheme was minor. From the $10 million that Mr.

Winckler and his secretary embezzled from Falcon Drilling, Mr. Pikel's facilitated only the

'' Id at 8.

15 {01493927}


misappropriation of $1.3 million, and his involvement in that component ofthe scheme was

limited.

The Court must impose a just punishment for the crime committed. In making this

assessment, the Court is entitled to consider the kind of damage Mr. Pikel has caused himself In

addition to the stresses and mental anguish of being a target of a criminal prosecution, Mr. Pikel

has incurred substantial collateral damage. Mr. Pikel was the owner of a liquor license and

bar/restaurant in Home, PA. As a result of his guilty plea, Mr. Pikel is not able to hold a liquor

license and therefore his liquor license, as well as his business, had to be transferred to his

daughter. His bar/restaurant and garage business has experienced a sharp decrease in sales due

to Mr. Pikel's plea of guilty. Additionally, as part ofthe garage business, Mr. Pikel owned a tow

truck. He had regular customers, including the Pennsylvania State Police, with fleet of cars and

tracks that Mr. Pikel serviced. Upon his guilty plea, the Pennsylvania State Police prohibited

any state trooper from contacting Pikel's Universal Auto Repair for towing services.^' In

addition, citing Pikel's guilty plea, the insurance company insuring his tow truck cancelled Mr.

Pikel's coverage which caused him to lose his tow tracking business.*^

Mr. Pikel's reputation has suffered immensely which, not surprisingly, has negatively

affected his businesses. Mr. Pikel's name and the name of his companies have been splattered

all over the town's newspapers^^. In such a small town, having a good reputation is essential to

ranning a profitable business, as well as, living in good standing in the community.

Incarceration is not the only method of providing just punishment or promoting respect for the

^̂ Exhibit C

*̂ Exhibit D

'̂ Montgomery, Laurie and Helderman, Roselind, S., Senate Plays Waiting Game; 10/14/13; http://wwvy.post-gaze tte.com/stories/news/us/senate-plavs-waiting-game-70748. Exhibit E

16 {01493927}


law. A curtailment of a defendant's livelihood can provide as much deterrence and punishment

as incarceration.

2. The Kinds of Sentences Available

Section 3553(a)(3) requires the Court to consider the kinds of sentences available. Mr.

Pikel is a 57 year old man, with a 12th grade education who has no prior criminal convictions

and has pled guilty to a non-violent crime. The Court does not have to be concemed about Mr.

Pikel harming or injuring anyone. This Court does not have to be concemed about Mr. Pikel

being a recidivist. A term of probation or home confinement followed by a probationary term is

a sentence that is sufficient, but not greater than necessary, to comply with the purposes of

sentencing. It is also a sentence that is available to the Court.

With the deficit facing the United States, deep cuts in the justice system have been

necessary. These cuts threaten the proper administration of justice. The Federal justice system

is experiencing furloughs and sequestrations. As ofthe writing ofthis Memorandum, the Federal

govemment has partially shut down with some Federal employees, including prosecutors, public

defenders and Court persormel being furloughed.^" Budget cuts require the Courts to be judicious

in not overburdening the system, particularly when dealing with non-violent offenders. On

August 12, 2013, at the Annual Meeting ofthe American Bar Association's House of Delegates

the Attomey General, Eric Holder, stated: "It's clear - as we come together today- that too many

Americans go to too many prisons for far too long, and for no traly good law enforcement

^°http://www.post-gazette.com/stories/locaL'neighborhoods-city/shutdown-of-federal-govemment-begins-to-take-hold-in-downtown-pittsburgh-705669/

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reason." Attomey General Holder further stated that, "although incarceration has a significant

role to play in our justice system- widespread incarceration at the federal, state, and local levels

is both ineffective and unsustainable. It poses a significant economic burden- totaling $80

billion in 2010 alone- and it comes with human and moral costs that are impossible to

calculate."^^

According to the Urban Institute Justice Policy Center, the "BOP is operating at 39

percent above its rated capacity, with 55 percent crowding at high-security facilities and 51

percent at medium-security facilities. Since FY 2000, the inmate-to-staff ratio has increased

from about 4:1 to a projected 5:1 in FY 2013. This degree of crowding threatens the safety of

both inmates and correctional officers, and it undermines the ability to provide effective

programming."^^ The annual cost of incarcerating an inmate is $21,006.00 for minimum

security, $25,378.00 for low security and $26,247.00 for medium security '̂*. The annual cost of

supervising a defendant, such as Mr. Pikel, on probation $3,447.41. ^̂ Thus, incurring such high

expense by incarcerating Mr. Pikel necessitates a diversion of resources that would be better

spent on violent and recidivist defendants.

^̂ Exhibit F. Attomey General Eric Holder Delivers Remarks at the Annual Meeting ofthe American Bar Association's House of Delegates, August 12, 12013: http://wwvy.iustice.gov/iso/opa/ag/speeches/2013/ag-speech-130812.html p.2

^̂ Id. at p. 5.

^̂ La Vigne, Nancy and Samuels, Mie, The Growth and Increasing Cost ofthe Federal Prison System: Drivers and Solutions; http://www.urban.org/UplQadedPDF/412693-The-Growth-and-Increasing-Cost-of-the-Federal-Prison-System.pdfat p. 1 citing U.S. Department of Justice Federal Prison System FY 2013 Performance Budget: Congressional Submission (Washington, DC: 2012),; http://wwwjustice.gov/jmd/2013justification/pdffyl3-bop-se-justification.pdf

"̂̂ Id at p. 2.

^̂ "Supervision Costs Significantly Less Than Incarceration in Federal System", July 18, 2013, http://news.uscourts.gov/supervision-costs-significantly-less-incarceration-federal-system

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3. The Sentencing Guidelines

The Court must give the same weight to the Sentencing Guidelines as it does to any other

§3553(a) factor. Although the Third Circuit m U.S. v King, 454 F3d. 187, (3d Cir. 2006) stated

that the starting point of determining a sentence is the Sentencing Guidelines, Congress has

placed the Sentencing Guidelines fourth in the hierarchy of sentencing considerations set forth in

§3553.

The Guideline range in the present case is 24- 30 months. The United States Supreme

Court and the Third Circuit have stated that a sentence of probation substantially restricts

freedom and can serve the purposes of sentencing as stated in 18 U.S.C. §3553. (Gall, supra and

United States v Tomko, 562 F.3d 558 (3d Cir. 2009)). A custodial sentence in this case will be a

severe sentence and not serve the purposes of sentencing. The Third Circuit in United States v.

Olhovsky, 562 F.3d 530 (3d. Cir. 2009) cited Gall in rendering a six year prison term

unreasonable for Child Pomography and stated that "a sentence of imprisonment may work to

promote not respect, but derision, of the law if the law is viewed as merely a means to dispense

harsh punishment without taking into account the real conduct and circumstances involved in

sentencing"^^. The Third Circuit further stated that, "The hideous nature of an offender's

conduct must not drive us to forget that it is not severe punishment that promotes respect for the

law, it is appropriate punishment. Although there are clearly times when anything less than

severe punishment undermines respect for the law, it is just as certain that unduly severe

punishment can negatively affect the public's attitude toward the law and toward the criminal

justice system."^'

^^ Id at 551 citing Gall at 599.

^^Id.

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4. Conclusion

Mr. Pikel has violated the law. He is remorseful. He is embarrassed that his lack of

judgment has hurt his family and the members of his tranquil community. He has lost his stature

as a man of respect and dignity. He has been humiliated not only in the press, but also by the

need to request his friends, family and neighbors to write letters to the Court on his behalf. He

has lost his liquor license, his tow track insurance and one major towing contract with the

Pennsylvania State Troopers. He has lost significant business as a result of his poor judgment.

What he has not lost is his natural instinct to care for others. The amount of support from Home,

PA he has received throughout this ordeal has been impressive. It is obvious that Home, PA is a

good fit for Mr. Pikel. It will much better serve society's interest, as well as the Federal

government's budget, if Mr. Pikel were to be placed on probation or home detention rather than

to be incarcerated.

Respectfully submitted,

/s/Robert J. Ridge Robert J. Ridge

CLARK HILL THORP REED, LLP

One Oxford Centre 301 Grant Street, 14* Floor Pittsburgh, PA 15219 (412) 394-2440

Attomeys for Defendant, Daniel Pikel

Dated: October 14, 2013

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CERTIFICATE OF SERVICE

I hereby certify that on October 14, 2013, the foregoing MEMORANDUM IN

AID OF SENTENCING was filed electronically. Notice of filing will be sent to all parties by

operation of the Court's electronic filing system. Parties may access this filing through the

Court's system.

/s/ Robert J. Ridge Robert J. Ridge

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