The Champion

May/June 2008 , Page 36 

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Challenges for White Collar Sentencing in the Post-Booker Era

By John H. Chun, Gregory M. Gilchrist

While it is widely noted that the U.S. Sentencing Guidelines were promulgated in an effort to increase uniformity of sentences, less commonly recognized is the specific effort of the Guidelines to remedy the perception of undue disparity in sentencing between white collar offenses and other crimes. The introduction to the Guidelines states that one of the Sentencing Commission’s goals was to eliminate the pre-Guidelines inequity of “punishing economic crime less severely than other apparent equivalent behavior.”1 The Commission was even more explicit in its effort to increase jail time in the context of tax offenses, noting:

Under pre-Guidelines practice, roughly half of all tax evaders were sentenced to probation without imprisonment, while the other half received sentences that required them to serve an average prison term of 12 months. This guideline is intended to reduce disparity in sentencing for tax offenses and to somewhat increase average sentence length. As a result, the number of purely probationary sentences will be reduced.2  

The creation of sentencing guidelines immediately increased sentences for many white collar offenses, and in the 21 years following, the trend of increasing sentences continued.3 Just as legislators consistently react to public fears of violent crime by increasing penalties for drug crimes, so too have they reacted to corporate scandals by increasing penalties for economic crimes.4 Let there be no mistake, the Guidelines have worked to the detriment of criminal defendants generally. However, defendants in white collar or economic crime cases have fared particularly poorly under the Guidelines.5 

The U.S. Supreme Court’s decision in United States v. Booker — rendering the Guidelines advisory and requiring appellate deference to the sentencing determinations of district judges — appeared to hold the greatest promise for white collar defendants. As it was the Guidelines that tended to increase sentences for white collar defendants, the decision rendering the Guidelines merely advisory suggested a shift toward the sentencing structure that prevailed before the Guidelines.

That promise thus far has proven largely illusory. The courts of appeals were quickly split on the appropriate standard of review for sentences on appeal. In particular, courts differed on whether a sentence within the Guidelines enjoyed, on review, a presumption of reasonableness.6 In Rita v. United States, the Supreme Court held that an appellate court may apply a presumption of reasonableness to a sentence within the appropriate guideline range.7 The Rita Court did not address specifically the standard of review an appellate court should apply in reviewing a non-Guidelines sentence.

Since Rita, a number of white collar sentences below the Guidelines have been reversed as unreasonable on appeal and deference to the district court generally has not been as strong as the Booker and Rita decisions suggested it might be. The review in these cases often more closely resembled de novo than abuse of discretion. And the reasoning applied in these cases indicates that white collar defendants face unique hurdles in obtaining leniency at sentencing.

The Supreme Court’s recent decisions in Gall v. United States and Kimbrough v. United States8 may help white collar defendants clear these hurdles. In Gall, the Supreme Court answered the question left open in Rita and instructed appellate courts to apply deferential abuse-of-discretion review to non-Guidelines sentences.9 And, in Kimbrough, the Court reminded district courts of the limited role of the Guidelines at sentencing: the “Guidelines, formerly mandatory, now serve as one factor among several courts must consider in determining an appropriate sentence.”10 The effect of these decisions and whether they will materially improve sentences for white collar defendants remains to be seen. This article discusses a few of the lessons to be gleaned from these cases.

I. Significant Post-Rita Reversals of Variances And the Potential Impact of Gall

A. United States v. Tomko
William Tomko, Jr. was owner and president of W.G. Tomko & Sons, a construction company. In the late 1990s, Tomko built himself a new home. The subcontractors were instructed to bill expenses to the construction company, as opposed to Tomko. W.G. Tomko & Sons then took deductions on the costs of the new home as business expenses, resulting in a tax deficiency of over $200,000.11 In 2004, Tomko pled to a single count information charging tax evasion.

Tomko had a negligible criminal history, and thus was Criminal History Category I under the Guidelines. The parties agreed that the proper offense level under the Guidelines was 13, establishing a Guideline range of 12 to 18 months incarceration. This range is in the Zone D range and accordingly, § 5C1.1(f) called for incarceration. The district court sentenced Tomko to probation with a period of home detention. The Third Circuit reversed, holding that the sentence imposed was inconsistent with the goals of 18 U.S.C. § 3553(a). This reversal is noteworthy because it is not predicated on a procedural error by the district court. The district court appears to have carefully addressed each factor set forth in § 3553(a). Rather, the appellate court found substantive error. The appellate court disagreed with the district court’s analysis of the factors and weighing of the evidence.

The district court varied from the Guidelines on four bases: negligible criminal history, strong record of employment, ties to the community, and extensive charity work. The Third Circuit found the first two of these unpersuasive, noting that far from being significant distinguishing factors, a limited criminal history and strong record of employment would be expected in most white collar cases. The appeals court did not dispute Tomko’s strong ties to the community — a finding supported by over 50 letters of support “paint[ing] a picture of Tomko as a man with great concern for his employees and his community.”12 However, the appeals court did find that this factor was outweighed by § 3553(a) factors calling for a prison sentence. Finally, the appeals court appears to have come to a similar conclusion with regard to Tomko’s community service. It is worth noting, however, that the opinion itself makes clear that the court’s skepticism about Tomko’s motivation for performing charity work between his plea and sentencing was also a significant factor in its decision.

In sum, the Tomko case appears to reflect little more than a substantive disagreement about the purpose of sentencing between the district court and the appellate court. Simply put, the district court sentenced the defendant; the appellate court sentenced the crime. The court of appeals described the district court sentence as, “in effect, a 100% downward variance from the Guidelines range.”13 While the district court expressly considered each of the § 3553(a) factors, its consideration was tempered by specific facts about Tomko.14 On the other hand, the appellate court found the “sentence of probation does not reflect the seriousness of the offense, promote respect for the law, and provide just punishment for the offense.” The case was remanded for resentencing.15 

B. United States v. D’Amico
In United States v. D’Amico,16 a former city controller was convicted of extortion and false statements in violation of 18 U.S.C. §§ 1951 and 1001, respectively. His applicable Guideline range was 31 to 44 months, but the court sentenced D’Amico to four months’ imprisonment. The variance was granted based on, among other things, the collateral consequences of the defendant’s conviction, which would likely preclude his ability to seek public office and engage in other professional work, and the defendant’s prior good works as a legislator.17 

On appeal, the First Circuit vacated the sentence. The court noted that the variance resulted in an 88 percent reduction in the defendant’s sentence. Although the court did not disagree with the district court’s finding that the defendant had performed prior good works as a public servant, the court believed that the sentencing court “overvalued” these contributions.18 According to the court, it was the defendant’s “job to respond to the needs of his constituents and to make positive contributions to his community. He was compensated for these efforts, which were essential to D’Amico’s re-election and prospects for other political office.”19 More generally, the court held that “it is usually not appropriate to excuse a defendant almost entirely from incarceration because he performed acts that, though in society’s interest, also were the defendant’s responsibility to perform and stood to benefit the defendant personally and professionally.”20 

Furthermore, regarding the collateral consequences attendant to D’Amico’s conviction, the court held such matters were not an appropriate basis for a substantial variance. “White collar defendants, such as D’Amico, often have achieved more tangible successes than other defendants, thereby making it easier for white collar defendants to articulate specific losses stemming from the fact of conviction. . . .”21 Granting a substantial variance based on the collateral consequences of a conviction will “inevitably lead to sentencing courts treating white collar defendants more leniently (in the relative sense) simply because of their societal status — a result that would be contrary to one of the primary objectives of Congress in enacting the current federal sentencing scheme.”22 

C. United States v. Carlson
In United States v. Carlson,23 the defendant was convicted of willfully failing to account for and pay trust fund taxes in violation of 26 U.S.C. § 7202. For his crime, he faced a Guideline range of 18 to 24 months. The district court sentenced him to eight months’ home confinement, probation and community service. The sentencing judge granted the variance because the defendant: (a) had a significant record of charitable activities; (b) accepted responsibility and made exceptional efforts to repay the taxes he owed; (c) suffered damage to his business, reputation, and family relationships; and (d) was not motivated by a desire to defraud the government, but was instead attempting to resolve a financial crisis within his business.24 

The Eighth Circuit vacated the sentence. The court noted that the variance amounted to a 100 percent reduction from the Guideline range and a seven-level reduction in offense level.25 According to the court, “[w]e have suggested that a variance to zero prison time where the Sentencing Commission has found that substantial prison time is indicated requires extraordinary justification and have routinely rejected this kind of variance as unreasonable.”26 The court held that the no-prison sentence did not promote respect for the federal tax laws or provide sufficient general deterrence.

Concerning the specific bases for the downward variance, the court held that Carlson’s charitable activities did not justify the extraordinary variance. Nor did the court find extraordinary the defendant’s effort to pay his tax obligations, which included raiding his retirement account and borrowing heavily from friends.27 The court noted that the defendant had already received a three-level adjustment for acceptance of responsibility. Indeed, the court noted that “placing too much weight on a defendant’s ability to make restitution immediately works to differentiate criminal defendants on the basis of their economic resources, which is clearly contrary to the intent of the sentencing guidelines.”28 The court also found that the collateral consequences of the conviction to defendant’s business, family, and reputation “do[] not appear to be anything out of the ordinary for individuals convicted of such crimes.”29 

D. Themes From Tomko, D’Amico and Carlson
The Tomko, D’Amico and Carlson decisions share at least two basic features. The first is their reliance, post-Rita, on the “proportionality” doctrine. Variances are scrutinized not only in terms of the overall reduction in offense level, but also in terms of the percentage reduction they represent from the recommended incarceration range. Thus, a variance from imprisonment to probation is scrutinized heavily even when no more than a few offense levels are at stake.30  

Second, the heavy scrutiny of variances by those courts reflects a conscious desire to avoid a revival of the pre-Guidelines perception that economic crimes are punished less severely than other crimes. Or to put it more bluntly, the courts wished to avoid the perception that “wealthy defendants can buy their way out of a prison sentence.”31 They were thus unwilling to uphold variances based on factors they perceived as common to all white collar defendants or based on the socio-economic status of the defendant. Accordingly, the timely payment of restitution may not ordinarily constitute a ground for a variance since it would unfairly favor the wealthy at sentencing. Similarly, charitable activities, public service, and the collateral consequences of a conviction may be regarded as ordinary incidents of most white collar cases.

Though the Gall case now forbids the “proportionality” doctrine, it remains to be seen whether it will ease the heavy scrutiny being applied to white collar sentences.

E. Gall v. United States
In Gall, defendant Brian Gall was convicted of conspiring to distribute narcotics in an enterprise from which he had withdrawn approximately five years earlier.32 His Sentencing Guideline range was 30 to 37 months. The district judge sentenced Gall to 36 months probation, finding that his sentence reflected the seriousness of the offense and that imprisonment was unnecessary given the defendant’s voluntary withdrawal from the conspiracy and his post-offense conduct, which included earning a college degree and starting his own successful business, all of which indicated that he was not a danger to society.33  

The Eight Circuit reversed, holding that a sentence outside the Guideline range had to be supported by a justification that is “proportional to the extent of the difference between the advisory range and the sentence imposed.”34 According to the Eighth Circuit, the sentence of probation reflected an “extraordinary” 100 percent downward variance from the applicable Guideline range. The appellate court ruled that the sentence was justified by neither Gall’s voluntary withdrawal from the conspiracy nor his youth at the time of the offense. Finding that the extraordinary variance was not supported by “extraordinary circumstances,” the court reversed.

The Supreme Court, finding that the Eighth Circuit had failed to give due deference to the district court’s sentencing decision, reversed and upheld the original sentence. According to Gall, appellate courts may not require that “extraordinary” circumstances justify a variance nor may they employ rigid mathematical formulas that use the percentage of the variance to determine whether the sentencing court’s justifications are sufficiently compelling.35 Prior to granting variances, district judges must consider the extent of the variance and ensure that the justification is “sufficiently compelling” to support the degree of variation.36 On review, although the extent of the difference between the Guideline range and the sentence imposed is “relevant,” courts of appeals must review all sentences under a deferential abuse of discretion standard.37  

F. Review After Gall
The decision in Gall, on its face, would seem to undermine the type of review engaged in by the Tomko, D’Amico and Carlson courts. There is no doubt that the mathematical approach relied on by the Tomko and Carlson courts is invalid. However, it remains to be seen how deferential courts of appeals will actually be when the district court imposes a sentence with which they disagree. A recent decision from the Eleventh Circuit gives some cause for caution. In United States v. Pugh, the appellate court reviewed the probationary sentence imposed on a defendant convicted of knowing possession of child pornography in violation of 18 U.S.C. § 2252A(a)(5)(B).38 The Guideline range had been 97 to 120 months, and the district court varied substantially to impose a sentence of probation.

The Eleventh Circuit reversed, finding the district court sentence unreasonable.39 The appellate court was careful to describe its own deferential review.40 However, it is difficult to escape the conclusion that the appellate criticism of the district court’s sentencing analysis amounts to little more than a substantive disagreement about how to weigh sentencing factors in a particular case.41 It would probably be a mistake to make too much of the decision in Pugh. The nature of the crime is particularly incendiary and the variance was dramatic. However, the district court had not lightly varied. The district court held sentencing hearings over two days, heard from numerous witnesses, and “deliberated extensively over its sentencing decision.”42 Notwithstanding statements to the contrary, the review on appeal does not look quite like a deferential abuse of discretion standard. Gall may comfort some defendants and embolden some district courts; however, defense counsel should not become comfortable. A victory at sentencing can still turn into a loss on appeal if the appellate court disagrees too much.

II. Counsel Should Continue to Seek Downward Departures

Prior to the Booker decision, absent cooperation, departures pursuant to U.S.S.G. § 5K2.0 represented the primary vehicle for seeking leniency under the Guidelines. Essentially, courts were authorized to grant departures when the Guidelines failed adequately to take into account some mitigating factor present in an individual defendant’s case.

When it made the Guidelines advisory, Booker introduced the concept of a variance, which represents a second way to seek leniency at sentencing. The touchstone for a variance is 18 U.S.C. § 3553(a), and one may be granted where a defendant’s Guideline sentence is higher than necessary to achieve the sentencing purposes set forth in § 3553(a). In light of their authority to grant both departures and variances, sentencing judges are now required to engage in a multi-step, sequential sentencing process, which typically includes first a calculation of the applicable Guideline range, then the consideration of any departures, and then finally a consideration of any variance pursuant to § 3553(a).

In the post-Booker era, it is important that defense counsel not lose sight of departures, and continue to present their arguments for mitigation both in terms of a departure as well as a variance. Departures remain vital because courts are likely to continue to give the Guidelines inordinate weight in their sentencing considerations — 21 years of sentencing under the Guidelines is bound to affect how judges approach sentencing. Departures are a product of the Guidelines, and arguments in their support can draw upon two decades of case law. Thus, in contrast to variances, departures present less of threat to the Guidelines and the goal to promote uniformity in sentencing. As illustrated by the examples that follow, most variances — including those presented in the Tomko, D’Amico and Carlson cases — have a departure analog. Given that courts, even after Gall, are likely to remain Guideline-centric for the foreseeable future, a departure argument may stand a better chance of being granted and upheld.

A. Departures for Charitable and Good Works
Although the D’Amico court criticized a variance based on charitable and good works, this is a recognized ground for departure. In the departure context, the Guidelines generally prohibit departures for charitable works unless they are extraordinary.43 The act of writing a check to a favorite charity is not considered extraordinary; courts typically focus on whether the defendant devoted his personal time to the charitable activities.

The case of United States v. Cooper44 is instructive. Fred Cooper was convicted of securities fraud and filing a false tax return. His sentencing range was 15 to 21 months. The court granted a four-level departure for his good works and sentenced the defendant to three years probation. The defendant’s good works involved extensive community and charitable activities on behalf of underprivileged children, including organizing two youth football teams, mentoring his players, and aiding them financially with school tuition. Granting the departure, the court noted that the defendant’s activities were not “the detached acts of charity one might ordinarily expect from a wealthy business executive. They are, in a very real way, hands-on personal sacrifices, which have had a dramatic and positive impact on the lives of others.”45  

B. Departures for Post-Offense Rehabilitation
Often, good works initiated after the offense is detected will best be presented as a basis for a departure in light of extraordinary post-offense rehabilitation. Courts have the authority to depart downward where the defendant has demonstrated extraordinary rehabilitation.46 Exceptional commitment to one’s community can evidence extraordinary post-offense rehabilitation and can be the basis for a substantial departure.47 Of note, Tomko’s community service is of exactly the sort that often supports a post-offense rehabilitation departure (although the Third Circuit made clear its skepticism about his motive in performing community service). Where a defendant can persuade a court that substantial rehabilitation has already occurred by the time of sentencing, the case law does support this departure.

C. Collateral Consequences Of Conviction Are Grounds For Departure
The Tomko, D’Amico and Carlson courts reversed variances that were granted in part based on the collateral consequences of a conviction to a white collar defendant. Courts have, however, granted departures where the collateral consequences of a conviction are extraordinary. These circumstances include those where a defendant’s incarceration would lead to the collapse of a business and thus harm to innocent employees, and where a conviction results in the loss of a defendant’s profession or extraordinary harm to his reputation and his family.

For example, in United States v. Milikowsky48 the defendant was convicted of price fixing in violation of the Sherman Act. He faced a Guidelines sentence of 8 to 14 months. The district court held that a departure to a sentence of probation was warranted because the defendant’s incarceration would close his business and result in the unemployment of hundreds of employees. The Second Circuit affirmed, holding that the defendant was indispensable to the operation of the business, and a departure was justified because “imprisonment would impose extraordinary hardship on employees.”49 

Similarly, in United States v. Redemann,50 the defendant was convicted of conspiracy to commit bank fraud. He faced a Guideline sentencing range of 18 to 24 months. The court departed by two levels because “some of the purposes of sentencing are satisfied by circumstance(s) aside from the prison sentence called for by the Guidelines.”51 There the court found that the defendant was already subject to a stiff civil monetary penalty, substantial amounts of adverse publicity, and has suffered adverse personal, business, and family consequences, including the death of his wife during the criminal investigation.

D. Exceptional Post-Offense Restitution Is a Ground for Departure
Following the enactment of the PROTECT Act in 2003, departures for post-offense restitution are forbidden where the defendant fulfills his restitution obligations “only to the extent required by law including the Guidelines (i.e., a departure may not be based on unexceptional efforts to remedy the harm caused by the offense).”52 Exceptional efforts to make restitution, however, appear to remain a basis for departure.

United States v. Kim53 is instructive.54 The defendant husband and wife were convicted of conspiracy to defraud the United States and fraudulently obtain government assistance. They faced a sentence of 15 to 27 months, and 6 to 12 months, respectively, and owed the government approximately $268,000 in restitution. In conjunction with the entry of their guilty pleas, the defendants liquidated their personal savings and paid $50,000 towards their restitution. Furthermore, at sentencing, they paid the balance of the restitution through loans from friends and family. In analyzing whether to grant a departure, the court considered “the degree of voluntariness, the efforts to which a defendant went to make restitution, the percentage of funds restored, the timing of the restitution, and whether the defendant’s motive demonstrates sincere remorse and acceptance of responsibility.”55 The district court departed downward and sentenced both defendants to probation. The court noted that the restitution paid exceeded the amount of the defendants’ personal profit from the crime, the defendants liquidated three-fourths of their life savings, obtained the balance of their restitution through loans from family and friends, began to timely pay their restitution at the time of their guilty pleas, and demonstrated sincere remorse.56 

III. Obtaining and Preserving Variances: Lessons From Recent Case Law

Apart from Guidelines departures, a downward “variance” under 18 U.S.C. § 3553(a) represents a second way to reduce a defendant’s Guideline sentence. Under that statute, the Guidelines are but one factor that the courts are to consult in rendering a sentence that is “sufficient, but not greater than necessary” to achieve the statutory sentencing goals set forth in 18 U.S.C. § 3553(a)(2), after considering:

  • The nature and circumstances of the offense and the history and characteristics of the defendant, § 3553(a)(1);
  • The kinds of sentences available, § 3553(a)(3);
  • The guidelines and policy statements issued by the Sentencing Commission, including the applicable Guideline range, § 3553(a)(4) & (a)(5);
  • The need to avoid unwarranted sentencing disparity among defendants with similar records that have been found guilty of similar conduct, § 3553(a)(6); and
  • The need to provide restitution to any victim of the offense, § 3553(a)(7).

As Gall affirmed, § 3553(a) is the ultimate sentencing touchstone and the substantive reasonableness of a sentence will be measured against its factors. And, as Justice Breyer observed in the remedial portion of the Booker opinion, “Section 3553(a) ... sets forth numerous factors that guide sentencing. Those factors in turn will guide appellate courts ... in determining whether a sentence is unreasonable.”57 

Gall warned that the failure to consider these factors may be procedural error.58 And, the easiest way for an appellate court to reverse a sentence of which it substantively disapproves is to find procedural error. It is therefore critical that defense counsel assist the district court in creating a record of considering all the relevant factors. In white collar cases there will remain hurdles: requests for leniency must overcome the perception that a wealthy defendant is trying to buy his or her way out of prison or is seeking to exploit some socio-economic advantage at the expense of the Guidelines. Defense counsel should be sensitive to these concerns, and keep in mind at least three points in support of their variance arguments. First, remember that the presumption of reasonableness is an appellate presumption. Second, do not forget that the Guidelines range does not include all § 3553(a) factors. Finally, remember to protect the record.

A. Presumption of Reasonableness — An Appellate Presumption
According to the Rita Court, the presumption of reasonableness is an “appellate court presumption” that “applies only on appellate review” and is “not binding.”59 The majority in Rita justified a presumption of reasonableness in very large part by claiming a within-Guidelines sentence reflected a coincidence of two independent and reasoned judgments: (1) the Commission considering the sentence in the abstract, and (2) the district judge considering the sentence in a particular case.60 This assertion is admittedly a bit awkward, as it does not appear to recognize that among the factors the district court must consider under § 3553(a) is the Guideline range set by the Commission. However, as a practical matter, it is probably not shocking to suggest that where a district court finds a Guideline sentence appropriate, that determination will frequently be upheld on appeal.

The sentencing court, however, does not enjoy the benefit of this presumption. The majority was clear that the presumption of reasonableness was an appellate standard that should not bear on a district court’s decision. Of concern, of course, is the “gravitational pull” of the Guidelines, a pull that is strengthened with a presumption of reasonableness. As Justice Souter noted:

What works on appeal determines what works at trial, and if the Sentencing Commission’s views are as weighty as the Court says they are, a trial judge will find it far easier to make the appropriate findings and sentence within the appropriate Guideline, than to go through the unorthodox factfinding necessary to justify a sentence outside the Guidelines range.61  

Maybe it is not how courts are supposed to work, but of course consideration of how an appellate court will review a particular sentence plays into the decision of a district court. And therefore, Guidelines sentences will often be seen as a sort of appellate “safe harbor,” protecting the district court from reversal.

But this is not the law, and sentencing judges must exercise their own reasoned sentencing judgments separate and apart from the Guidelines. The Gall Court stated clearly that the Guideline range is simply the “starting point and the initial benchmark” for sentencing and the district court must consider all of the 3553(a) factors to determine the appropriate sentence.62  

If a district court does presume the Guidelines to be reasonable, and does not engage in an independent sentencing analysis, that is reversible error. Recently the Seventh Circuit reversed a Guideline sentence in a drug case, United States v. Ross.63 In Ross, the district court imposed a Guideline sentence, lamenting that it appeared higher than necessary in the particular case but suggesting the court could see no particular reason why the Guidelines should not apply. The appellate court found the language ambiguous, but suggestive enough of the idea that the Guidelines were presumptively reasonable to merit reversal.64 

B. The Guidelines Range Does Not Incorporate All § 3553(a) Factors
The Kimbrough decision recognized that the substantive reasonableness of a Guidelines sentence remains open to challenge.65 Although the court believed that the Sentencing Commission promulgated Guidelines that embody the § 3553(a) factors, this is open to debate where a specific Guideline calculation is concerned. Accordingly, in seeking a variance, defense counsel should investigate and argue to the court those aspects of the Guidelines that fail to incorporate the defendant’s individual mitigation.

Instructive in this regard is United States v. Wachowiak.66 The defendant was sentenced to 70 months in prison for downloading and sharing child pornography. His advisory Guideline range was 121 to 151 months. In granting a variance, the sentencing court took into account, among other things, several areas where the applicable Guidelines did not adequately incorporate the defendant’s individual mitigation. First, the court noted that the Guidelines failed to “fully account for [the defendant’s] ‘sincere expression of remorse’ and ‘otherwise outstanding character’ by narrowly channeling these considerations” into an “acceptance of responsibility” reduction under U.S.S.G. § 3E1.1. Second, the court noted that the Guidelines failed to take into account the significant collateral consequences of a conviction, including the defendant’s inability to pursue a chosen career. And third, the court noted that the Guidelines “failed to consider the positive role of Wachowiak’s family members, who promised to aid in his rehabilitation and reintegration into the community and support his efforts to avoid re-offending.”67 Because the Guidelines failed to take into account these mitigating factors, the Court varied downward.

Apart from the deficiencies noted by the Wachowiak court, the Guidelines — including U.S.S.G. §§ 5H1.1, 5H1.4, 5H1.5, 5H1.6 — expressly marginalize the relevance of other critical mitigation such as the defendant’s age, health, employment history, and family ties. In appropriate cases, these factors ought to be brought to the sentencing judge’s attention as they are not incorporated into the Guidelines but are otherwise highly relevant to a § 3553(a) analysis.

C. Protect the Record
Although a sentencing court is not required in every case to issue detailed or oral written findings, where a substantial variance is concerned, defense counsel should ensure that the record is as complete as possible. According to the Court in Rita, the sentencing judge should “set forth enough to satisfy the appellate court that he has considered the parties’ arguments and has a reasoned basis for exercising his own legal decision-making authority.”68 The sentences in the Tomko, Carlson and D’Amico cases were vacated, in part, because the appellate courts in those cases did not believe for a variety of reasons that an adequate record was made to support the variance. In Tomko and D’Amico, the courts believed that the reasons for the variance were not sufficiently compelling; in Carlson, the court rejected the variance in part because it believed that the sentencing judge did not adequately appreciate the § 3553(a) goal of general deterrence.

To ensure that a variance is supported by the record, defense attorneys should consider submitting to the court a proposed statement of findings to be included in the record at sentencing. The findings should touch on each of the § 3553(a) factors, and in particular discuss how the sentence furthers the statutory sentencing goals set forth in § 3553(a)(2). The D’Amico, Tomko and Carlson cases suggest that, in the white collar context, defense counsel should be particularly attuned to how the proposed sentence achieves the goals of specific and general deterrence. The proposed findings, moreover, should individualize the defendant’s mitigation and distinguish his or her contributions to society from the average white collar defendant. And finally, the proposed findings must acknowledge realistically the overall severity of the offense.

Conclusion

It has been widely noted that the Supreme Court continues to grant certiorari in fewer cases, and that as it does so the role of the federal courts of appeals is significantly enhanced.69 Following Rita, there were a number of reversals of defense-favorable variances in white collar cases. The Supreme Court’s decision in Gall may have a positive impact on sentencing outcomes for this class of defendants. As the post-Rita appellate court decisions illustrate, however, as a practical matter the courts of appeals may well have the final word. The cases decided in the wake of Rita suggest a high threshold is being set for variances, particularly variances that are perceived as undermining the stated purpose of the Guidelines to impose prison sentences for economic crimes and decrease sentence disparity for white collar defendants. In this environment, departures enjoy certain advantages: they are well-established, they are perhaps less noteworthy if only for being less novel, and they fit within a system of Guidelines that has been in place longer than most federal judges have been on the bench. Of course, the struggle in district court is generally just to get the reduced sentence; whether it is labeled a variance or departure is of little moment to the person who is saved prison time by the decision. As recent appellate decisions reveal, however, it is critical to protect on appeal the sentence earned below.

Notes

 

  1. U.S.S.G. ch. 1, pt. A, § 3.
  2. U.S.S.G. 2T1.1, cmt., background. 
  3. See, e.g., Frank O. Bowman, Are We Really Getting Tough on White Collar Crime? (June 19, 2002), Hearing Before the Subcomm. on Crime and Drugs, S. Judiciary Comm. Part 2, 15 Fed. Sent. R. 237, available at 2003 WL 22016895 (hereinafter, “Bowman Statement”) (discussing increases in the Guideline ranges for economic crimes resulting from 2001 amendments submitted by the Commission and accepted by Congress).
  4. See, e.g., “Report to the Congress: Increased Penalties Under the Sarbanes-Oxley Act of 2002,” United States Sentencing Commission, 1369 PLI/Corp 657, 665 (2003) (outlining Commission’s response to the directive to “expeditiously consider the promulgation of new sentencing guidelines or amendments to existing sentencing guidelines to provide an enhancement for officers or directors of publicly traded corporations who commit fraud and related offenses”).
  5. Bowman Statement at *3 (“It is undeniable that since 1987 the Guidelines have sent to prison thousands of white collar criminals who would previously have been given straight probation.”).
  6. Compare United States v. Dorcely, 454 F.3d 366, 376 (D.C. Cir. 2006) (uses presumption); United States v. Green, 436 F.3d 449, 457 (4th Cir. 2006) (same); United States v. Alonzo, 435 F.3d 551, 554 (5th Cir. 2006) (same); United States v. Williams, 436 F.3d 706, 708 (6th Cir. 2006) (same); United States v. Mykytiuk, 415 F.3d 606, 608 (7th Cir. 2005) (same); United States v. Lincoln, 413 F.3d 716, 717 (8th Cir. 2005) (same); and United States v. Kristl, 437 F.3d 1050, 1053-1054 (10th Cir. 2006) (per curiam) (same), with United States v. Jimenez-Beltre, 440 F.3d 514, 518 (1st Cir. 2006) (en banc) (does not use presumption), United States v. Fernandez, 443 F.3d 19, 27 (2nd Cir. 2006) (same); United States v. Cooper, 437 F.3d 324, 331 (3rd Cir. 2006) (same); and United States v. Talley, 431 F.3d 784, 788 (11th Cir. 2005) (per curiam) (same).
  7. 127 S. Ct. 2456, 2462 (2007). For more on the nuances of the Rita decision, see Steven G. Kalar & Jon M. Sands, (Not So) Lovely Rita, The Champion, August 2007 at 32.
  8. Gall v. United States, — U.S. —, 128 S. Ct. 586 (2007); Kimbrough v. United States, — U.S. —, 128 S. Ct. 558 (2007).
  9. Gall, 128 S. Ct. at 592 (“We now hold that, while the extent of the difference between a particular sentence and the recommended Guidelines range is surely relevant, courts of appeals must review all sentences — whether inside, just outside, or significantly outside the Guidelines range — under a deferential abuse-of-discretion standard.”).
  10. Kimbrough, 128 S. Ct. at 565. 
  11. United States v. Tomko, 498 F.3d 157, (3rd Cir. 2007).
  12. Id. at 172.
  13. Id. at 167 (because the Guidelines called for months of prison and the sentence imposed involved no time in prison).
  14. See, e.g., id. at 161 (noting that while tax evasion is a serious offense, Tomko presented little risk of recidivism).
  15. Tomko should generally be distinguished by the relation between the crime and the place of home detention. William Tomko effectively built his home as an illegal tax deduction. And the home was quite luxurious. The government complained bitterly, and the appellate court agreed, about the “perverse irony of this gilded cage confinement.” Id. at 166. There is little question that this was a significant factor in the court of appeals’ reasoning, particularly concentrating, as it was, on principles of general deterrence.
  16. United States v. D’Amico, 496 F.3d 95 (1st Cir. 2007).
  17. Id. at 105-06.
  18. Id. at 107.
  19. Id.
  20. Id.
  21. Id.
  22. Id.
  23. United States v. Carlson, No. 06-3372, 2007 WL 2350182 (8th Cir. Aug. 20, 2007).
  24. Id. at *1.
  25. Id. at *2.
  26. Id. (internal quotation marks, alteration, and citation omitted).
  27. Id. at *3.
  28. Id. at *3 n.4.
  29. Id. at *4.
  30. The Supreme Court in Gall attacked this overly “mathematical approach,” noting “deviations from the Guidelines range will always appear more extreme — in percentage terms — when the range itself is low, and a sentence of probation will always be a 100 percent departure regardless of whether the Guidelines range is 1 month or 100 years.” Gall, 128 S. Ct. at 595. Nonetheless, Gall still permits the appellate court to “take the degree of variance into account and consider the extent of a deviation from the Guidelines.” Id.
  31. Tomko, 2007 WL 2350765, at *12.
  32. Gall, 128 S. Ct. at 592-593.
  33. Id. at 593.
  34. Id. at 594.
  35. Id. at 595.
  36. Id. at 597.
  37. Id. at 592.
  38. United States v. Pugh, — F.3d —, 2008 WL 253040 (11th Cir. 2008).
  39. Id. at *21.
  40. Id. at *7-8.
  41. For example, in holding that the sentence failed to “afford adequate deterrence to criminal conduct,” or to serve the factors of “retribution, rehabilitation, and incapacitation,” the appellate court concluded, “We still cannot say that the resulting sentence fairly reflects their consideration.” Id. at *12-13. Although the appellate court goes to some length to explain why it disagrees with the district court analysis, it remains little more than that — a substantive disagreement. 
  42. Id. at *10.
  43. U.S.S.G. § 5H1.11.
  44. 394 F.3d 172 (3d Cir. 2005).
  45. Id. at 177; see also United States v. Serafini, 233 F.3d 758, 775 (3d Cir. 2000) (affirming three-level downward departure where defendant’s charitable acts included not only financial contributions but “devotion of himself and his time”).
  46. United States v. Brock, 108 F.3d 31, 35 (4th Cir. 1997) (remanding for resentencing where district court had denied departure for post-offense rehabilitation on the basis that it was not permitted to depart for that reason).
  47. See, e.g., United States v. DeShon, 183 F.3d 888, 889-90 (8th Cir. 1999) (defendant sentenced to five months community confinement from a range of 30 to 37 months where defendant exhibited exceptional rehabilitation through commitment to church, community, and employment).
  48. 65 F.3d 4 (2d Cir. 1995).
  49. Id. at *9.
  50. 295 F. Supp. 2d 887 (E.D. Wis. 2003).
  51. Id. at 896.
  52. U.S.S.G. § 5K2.0(d)(5).
  53. 364 F.3d 1235 (11th Cir. 2004).
  54. Kim was analyzed under the 1997 Guidelines, before the enactment of the PROTECT Act. Therefore, the more stringent standard was not applied. See 364 F.3d at note 9. However, the case remains an example of the type of restitution efforts required to impress a court. 
  55. Id. at 1244.
  56. Id.
  57. 543 U.S. at 261.
  58. Gall, 128 S. Ct. at 598-600. The recent Second Circuit decision in U.S. v. Cutler, — F.3d. —, 2008 WL 706633, (2nd Cir. 2008), contains a lengthy and instructive discussion of procedural error. In Cutler, the district court departed substantially from the Guidelines range and noted that in the alternative it would impose the same sentence pursuant to Section 3553(a). As part of its rationale for departing on the tax offense, the district court noted that “[w]ith respect to this type of an offense, ... the relative length of the sentence does not seem to be as important in providing deterrence.” Id. at *26. The Second Circuit held this to be procedural error in that the district court failed to comply with 18 U.S.C. § 3553(a)(4) — requiring the sentencing court to consider the pertinent guidelines. Id. at *27. Specifically, the appellate court: (a) ruled that the district court’s position on deterrence was at odds with the Guidelines, (b) recognized that a district court could disagree with the Guidelines “based solely on policy considerations,” but (c) held that in disagreeing with the Guidelines the court “is required to state the basis for its disagreement, along with sufficient justifications for the extent of any departure.” Id. Failing to do so is reversible procedural error.
  59. Rita, 127 S. Ct. at 2463, 2465.
  60. Id. at 2465 (“[T]he courts of appeals’ ‘reasonableness’ presumption, rather than having independent legal effect, simply recognizes the real-world circumstance that when the judge’s discretionary decision accords with the Commission’s view of the appropriate application of § 3553(a) in the mine run of cases, it is probable that the sentence is reasonable.”). 
  61. Id. at 2487 (internal citations omitted) (Souter, J., dissenting). 
  62. Gall, 128 S. Ct. at 596.
  63. United States v. Ross, — F.3d —, 2007 WL 2593509 (7th Cir. 2007).
  64. Id. at *2-3 (affirming that the presumption — whatever else it may be — is an appellate presumption, and is not operative at the district court level). 
  65. Kimbrough, 128 S. Ct. at 569 (“as a general matter, courts may vary from Guidelines ranges based solely on policy considerations, including disagreements with the Guidelines”).
  66. United States v. Wachowiak, 496 F.3d 744 (7th Cir. 2007).
  67. Id. at 747.
  68. Rita, 127 S. Ct. at 2468.
  69. See, e.g., Linda Greenhouse, Dwindling Docket Mystifies Supreme Court, N.Y. Times, December 7, 2006; William Glaberson, Caseload Forcing Two-Level System for U.S. Appeals, N.Y. Times, March 14, 1999. 

 

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