Brief filed: 01/21/2010
United States v. Berger
9th Circuit Court of Appeals; Case No. 08-50171
A defendant should not be punished based on victims’ losses that were not proximately caused by the defendant’s wrongdoing. For example, losses resulting from a general downturn in the relevant market (e.g., securities, real estate, currency), unforeseeable intervening events, or manipulation of the time period used by prosecutors to compute victims’ losses. The panel decision misapprehends the Supreme Court’s decision in Dura Pharmaceuticals, Inc. v. Broudo (2005), causing it to reject decisions of the Second and Fifth Circuits citing Dura in discussing loss causation in securities fraud cases; if left uncorrected, the panel opinion will effect a circuit split on an issue as to which there is no substantive disagreement and deter sentencing courts from adopting a reasonable economic approach to calculating loss under the federal sentencing guidelines in securities fraud cases.
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