Christian Ferrari pleaded guilty to four counts of willfully dealing firearms without a license. Between March and May 2023, Ferrari sold 22 unserialized, short-barreled rifles to undercover ATF agents in exchange for cash in parking lots. The agents told Ferrari the guns were for protecting marijuana grows and would be transported to Mexico. Ferrari had no Federal Firearms License and did not conduct background checks. At sentencing, the district court applied a four-level enhancement for firearms trafficking under the Sentencing Guidelines. Ferrari objected, arguing the enhancement did not apply because the undercover agents were federal officers and thus not actually unlawful possessors. The district court overruled the objection, finding Ferrari had reason to believe the sales were for unlawful purposes based on the circumstances.
The Ninth Circuit reviewed the interpretation of Application Note 13 to U.S.S.G. § 2K2.1(b)(5) de novo. The core legal question was whether the phrase 'knew or had reason to believe' requires that the transferee actually be an unlawful possessor. The court held that the plain text does not demand factual truth. The court explained that 'reason to believe' means having a basis to have confidence in the truth of something, which can exist even if the belief is factually incorrect. The court rejected Ferrari's reliance on out-of-circuit interpretations of 18 U.S.C. § 922(d)(1) and § 922(a)(5), noting those statutes have different amendment histories and policy concerns regarding state jurisdiction. The court also found the Sentencing Commission's 2023 Amendment 819 did not resolve the circuit split on this specific issue, as the Commission retained the 'reason to believe' language without clarifying it. Consequently, the court concluded that because Ferrari admitted he believed the agents were unlawful possessors, the enhancement was properly applied.
This decision clarifies that the firearms trafficking enhancement turns on the defendant's subjective state of mind regarding the transferee's status, not the objective reality of that status. This aligns the Ninth Circuit with the Sixth, Seventh, and Eleventh Circuits. The ruling stands for the proposition that selling firearms to undercover agents or decoys who are not actually prohibited persons still triggers the enhancement if the seller believed they were. The case was affirmed, and no remand instructions were issued.