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THE COURT OF APPEALS OF THE STATE OF ALASKA
STATE OF ALASKA, )
) Court of Appeals No. A-5360
Appellant, ) Trial Court No. 3AN-S92-625CR
)
v. ) O P I N I O N
)
WILLIE J. SYKES, )
)
Appellee. )
______________________________)
)
STATE OF ALASKA, )
) Court of Appeals No. A-5413
Appellant, ) Trial Court No. 3AN-S92-626CR
)
v. )
)
JAMES WILLIAMS, )
)
Appellee. ) [No. 1399 - March 17, 1995]
______________________________)
Appeal from the Superior Court, Third
Judicial District, Anchorage, Karen L. Hunt,
Judge.
Appearances: Cynthia M. Hora, Assistant
Attorney General, Office of Special Prosecu-
tions and Appeals, Anchorage, and Bruce M.
Botelho, Attorney General, Juneau, for
Appellant. Mark R. Davis, Law Offices of
Mark R. Davis, Anchorage, for Appellee Sykes.
Michael D. Dieni, Assistant Public Defender,
and John B. Salemi, Public Defender,
Anchorage, for Appellee Williams.
Before: Bryner, Chief Judge, Coats,
Judge, and Andrews, Superior Court Judge.*
[Mannheimer, Judge, not participating.]
COATS, Judge.
Willie J. Sykes and James Williams were partners in a
business, Wilsyk Alaska, Inc. Sykes was the president of the
corporation and Williams was the vice-president. The company's
business included performing various commercial janitorial
contracts. One of these contracts was with the Department of
Transportation and Public Facilities of the State of Alaska to
perform janitorial maintenance at the Anchorage International
Airport. The contract required Wilsyk to perform a minimum
number of hours of labor per day to maintain the airport. In
return, the state paid Wilsyk approximately $60,000 per month.
The contract required Wilsyk to submit to the airport officials
monthly time reports which reflected the hours performed by each
employee on each day.
From November 1987 through September 1989, Wilsyk
systematically engaged in a scheme in which it added false names
and hours to meet the contract's minimum requirements. During
this time, according to the presentence report, the reports which
Wilsyk submitted overstated the number of hours worked by
approximately 45,000 hours. The presentence report estimated
that Wilsyk over billed the state by at least $335,000.1 The
state showed that managers who were submitting the false names
and hours complained to Sykes and Williams about the policy,
contending that the policy was illegal and refusing to
participate in the scheme. In spite of these actions by their
employees, Sykes and Williams went forward with the policy.
Superior Court Judge Karen L. Hunt found that the defendants were
fully responsible for the scheme.
Pursuant to a plea agreement with the state, Sykes and
Williams pled no contest to theft in the second degree, a class C
felony, and unsworn falsification, a class A misdemeanor.
AS 11.46.130; AS 11.46.630. The state gave notice under Wylie v.
State, 797 P.2d 651, 662 (Alaska App. 1990), of its intent to
rely on three statutory aggravating factors to support its
argument that the court should impose a sentence in excess of the
two-year presumptive term for a second felony offender. The
state proposed the following statutory aggravating factors for
each defendant: that "the defendant was the leader of a group of
three or more persons who participated in the offense"; that "the
conduct constituting the offense was among the most serious
conduct included in the definition of the offense"; and that "the
defendant's criminal conduct was designed to obtain substantial
pecuniary gain and the risk of prosecution and punishment for
the conduct is slight." AS 12.55.155(c)(3), (10), & (16). The
defendants did not contest the fact that these aggravators
applied to their offenses, and Judge Hunt found that the
aggravators applied.
Neither Sykes nor Williams has any prior criminal
record. It is uncontested that both men have distinguished
backgrounds. Sykes served honorably in the military for twenty
years. He then started a business career. Sykes was the
Director of Small Business for the State Department of Commerce
from 1982 to 1984 and was the Acting Director of the Alaska State
Housing Authority from 1989 to 1992. In addition, he has held
high-level business positions in this state. Sykes has numerous
references from prominent political and business leaders.
Williams also has an outstanding prior history. He retired from
the Air Force after twenty years of service and launched a
business career with Sykes. Similarly, Williams has outstanding
references.
When sentencing Sykes and Williams, Judge Hunt
recognized these outstanding backgrounds. In spite of
recognizing that the defendants' offenses were serious thefts,
Judge Hunt concluded that both men had good prospects for
rehabilitation and concluded that it was unnecessary to impose a
sentence requiring either man to serve a term of imprisonment.
For each defendant, Judge Hunt imposed a composite sentence of
three years of imprisonment and suspended all of it. She placed
each defendant on probation for a period of five years. In
addition, Judge Hunt imposed $268,282 in restitution, a $25,000
fine, and 150 hours of community service on each defendant.
The state appeals, arguing that the sentence is too
lenient. The state contends that Judge Hunt erred in failing to
impose some period of imprisonment. We agree and disapprove the
sentences.2
The major offense which the defendants committed was
theft in the second degree, a class C felony, which carries a
maximum sentence of five years of imprisonment. AS 12.55.125(e).
There is a presumptive sentence of two years for a second felony
offender and three years for a third felony offender. Theft in
the second degree covers offenses where the value of property or
services stolen is $500 or more but less than $25,000.
AS 11.46.130(1). It is obvious that the defendants committed a
more serious crime than the one for which they were convicted.
They actually committed the offense of theft in the first degree,
which criminalizes thefts of $25,000 or more. AS 11.46.120.
Theft in the first degree is a class B felony, which carries a
maximum sentence of ten years of imprisonment. AS 12.55.125(d).
The legislature has provided a presumptive sentence of four years
for a second felony offender convicted of a class B felony and
six years for a third felony offender.
Although the trial court was certainly required to
sentence the defendants based on the fact that they had entered a
plea to a class C felony, the court was also required to consider
the fact that the defendants' offense was much more serious than
the crime to which they pled. See Benboe v. State, 698 P.2d 1230
(Alaska App. 1985). In light of the magnitude of the defendants'
theft, we believe that it is appropriate to consider as a
starting point reported cases involving similar thefts even
though those cases are distinguishable on the ground that the
defendants in those cases entered pleas to class B felonies.
This court and the supreme court have found lengthy
sentences not to be clearly mistaken where first offenders have
committed substantial thefts. In Karr v. State, 686 P.2d 1192
(Alaska 1984), the supreme court found not clearly mistaken a
sentence of ten years with five suspended where the defendant
embezzled approximately $356,000 from her employer. In Brezenoff
v. State, 658 P.2d 1359 (Alaska App. 1983), this court upheld a
sentence of eight years with four years suspended where the
employee embezzled approximately $140,000 from an employer. In
State v. Karnos, 696 P.2d 685 (Alaska App. 1985), we explored the
lower limits for sentences for first felony offenders convicted
of major thefts. Karnos embezzled approximately $115,000 from
his company over a period of approximately three and one-half
years and was convicted of theft in the first degree. Karnos had
considerable support in the community, and his former employer
expressly recommended against incarcerating him. In Karnos, the
trial judge imposed a sentence of five years, all suspended, and
placed the defendant on probation for five years. In
disapproving this sentence we stated:
We believe that the trial judge was
required to impose a sentence which involved
serving at least ninety days in jail in this
case. Karnos' crime involved a large amount
of money and many acts of theft over a long
period of time. Although Karnos' personal
situation may have contributed to his crime,
this was certainly a crime of premeditation,
and not of impulse. People who commit
relatively petty thefts frequently are
sentenced to serve jail terms. We believe
that a probationary sentence unduly
deprecates the seriousness of the nature of
Karnos' crime and does not serve to reaffirm
societal norms against this type of major
theft. We certainly believe that this was an
appropriate case for the trial judge to
consider having Karnos serve time on weekends
if this would help to preserve his
employment. The court could also have
allowed Karnos to perform some community
service time to substitute for some
incarceration time. However, we conclude
that the sentence of five years of suspended
time was too lenient.
Id. at 687 (citation and footnote omitted). Recently in State v.
Buza, ___ P.2d ____, Opinion No. 1381 (Alaska App., December 16,
1994), the defendant was convicted of theft in the first degree
for embezzling approximately $100,000 from his employer over a
four-year period. Like Sykes and Williams, the defendant had no
prior convictions, an excellent prior work history, and
outstanding personal references. Buza had fully reimbursed his
employer, and the employer wrote a letter to the court expressly
recommending that the court not incarcerate Buza but require him
to perform community service. Id. at 2. The trial court
sentenced the defendant to four years of imprisonment with all of
the sentence suspended. Id. The trial judge placed Buza on
probation for five years, requiring him to perform 500 hours of
community work and to pay a fine of approximately $50,000. In
spite of these sanctions, the majority of this court, relying on
Karnos, disapproved the sentence as too lenient.
Against this legal background, we consider the
defendants' cases. The obvious distinction between the cases we
have discussed and the present cases is that Sykes and Williams
were convicted of class C felonies; thus, Karnos is not strictly
applicable. The defendants cite to Leuch v. State, 633 P.2d
1006, 1013-14 (Alaska 1981) (footnote omitted), where the supreme
court stated that where a first felony offender was convicted of
an offense against only property and not an offense involving
physical threats or violence, the court should impose probation
and restitution "unless other factors militate against it." In
the instant case, we believe that the magnitude of the thefts and
the likely failure of full restitution3 militate against imposing
a sentence which does not require incarceration.
Given Sykes' and Williams' exemplary backgrounds, and
the fact that they were convicted of class C felonies, we do not
believe that the court was required to impose the equivalent of
at least ninety days in jail as we suggested in Karnos. However,
we believe that the court was required to sentence Sykes and
Williams to some period of incarceration in order to emphasize
the criminal nature of their acts. We believe that a sentence
which does not require some period of incarceration would send
the message that white-collar criminals who commit major theft
offenses are able to avoid incarceration. We accordingly
disapprove the sentences.
The sentences are DISAPPROVED.
_______________________________
* Sitting by assignment made pursuant to article IV, section
16 of the Alaska Constitution.
1 Judge Hunt found that the State of Alaska had suffered a
"loss by theft of over a quarter of a million dollars."
2 When the state appeals a sentence as too lenient, we are
not authorized to increase the sentence but may only express our
approval or disapproval. AS 12.55.120(b).
3 Although Judge Hunt imposed a substantial amount of
restitution and fines in this case, it appears that the
defendants will have difficulty paying these amounts. According
to the presentence report, Sykes has debts of approximately
$1,375,000 and assets of $75,000. Williams reports that he has
no assets, owes the Internal Revenue Service approximately
$675,000, and is not making any payments on that amount.
