Tuesday, September 02, 2014

8th Circuit affirm sentence of probation where guidelines were 135-168 months

District judges, I think, are still fearful of giving large variances in white-collar cases (especially after trial), but this 8th Circuit case should give some more comfort:
A jury found Abby Rae Cole guilty of conspiracy to commit mail and wire fraud, tax evasion, and conspiracy to commit tax fraud.  The district court sentenced Cole to three years probation, a downward variance from the advisory Guidelines range of 135 to 168 months imprisonment.  The government appealed the sentence as substantively unreasonable, and Cole cross-appealed her convictions.  We affirmed the convictions but declined to reach the issue of whether the sentence is substantively unreasonable, finding procedural error in the lack of an adequate explanation by the district court for the sentence and the substantial downward variance.  We remanded the case to afford the district court a chance to supply an adequate explanation....
In our previous opinion, we noted that before reaching the substantive reasonableness of a sentence “‘[w]e must first ensure that the district court committed no significant procedural error,’” such as “failing to adequately explain the chosen sentence—including an explanation for any deviation from the Guidelines range.” Id. (quoting United States v. Feemster, 572 F.3d 455, 461 (8th Cir. 2009) (en banc)). We noted that Cole and her co-conspirators’ convictions were based on the theft of approximately $33 million from Best Buy over a four-year period and the evasion of over $3 million in taxes, Cole’s sentencing Guidelines range was 135 to 168 months imprisonment, and Cole’s co-conspirators, her husband and a Best Buy employee, received sentences of 180 and 90 months respectively. Despite these facts, the district court provided scant explanation for the profound downward variance to a sentence of probation.
On remand, the district court received additional briefing from the parties, conducted a hearing in which it heard additional argument with respect to sentencing, and then announced its reasons for the downward variance and the probationary sentence in a lengthy and comprehensive analysis concluding with the observation that this is an “unusual, extraordinary case in which a sentence of three years probation was appropriate.”  In the additional analysis, the district court touched on all of the section 3553(a) factors in explaining the rationale behind the sentence it imposed upon Cole. The district court recognized the numerous restrictions Cole endured while on probation and the “lifelong restrictions” she faces as a federal felon, see 18 U.S.C. § 3553(a)(2)(A)&(B); the court stressed that, with the probationary sentence, Cole would be less likely to commit further crimes as she “has a far greater likelihood of successful rehabilitation with family support and stable employment,” see 18 U.S.C. § 3553(a)(2)(C). The court also explained that while “[t]his was one of the largest corporate frauds in Minnesota history and was also a significant tax fraud,” Cole served a more minor role as, in the court’s judgment, she was “mostly a passive, although legally responsible, participant.” See 18 U.S.C. § 3553(a)(1).  The court focused on Cole’s history and characteristics, emphasizing that she had no prior contact with law enforcement and was “markedly different” than “most of the fraudsters who appear before th[e] Court” in that Cole “is not a consummate fraudster, she is not a pathological liar.” See 18 U.S.C. § 3553(a)(6). Finally, the district court explained that the probationary sentence would allow Cole to work and earn money to make restitution to the victims of the fraud.  See 18 U.S.C. § 3553(a)(7).
The United States persists in its appeal, contending that the district court improperly based the sentence on Cole’s socioeconomic status, her restitution obligations, and her loss of criminally derived income.  However, the facts of Cole’s fall from an industrious and highly successful entrepreneur to convicted felon and the loss of the bulk of her legitimately acquired assets cannot be denied.  We find no error in the district court’s reference to these events....
While we do not minimize the seriousness of the crimes perpetrated by Cole and the staggering nature of the fraudulent scheme in which Cole was a participant, the district court here, unlike in Dautovic, has adequately explained the sentence and appropriately considered the section 3553(a) factors in varying downward to a probationary sentence, making “precisely the kind of defendant-specific determinations that are within the special competence of sentencing courts.”  Feemster, 572 F.3d at 464 (quotation omitted).  For instance, the district court noted that Cole’s role in the offense was mostly as a passive participant and Cole was not the typical white collar defendant the court had observed in similar criminal schemes.  We find no error in the weighing of the section 3553(a) factors, and thus the district court did not abuse its substantial discretion in sentencing Cole to probation.
 In local news, Fane Lozman made the front page of the Palm Beach Post this weekend.  You remember Lozman -- he's the guy who went to the Supreme Court on the floating boat/house issue and won!  Here's the intro to the new piece:

Ducking under mangroves to reach the Intracoastal Waterway, Fane Lozman spreads his arms wide as he contemplates living on a narrow strip of land on Singer Island that most believed would never be developed.
“How can you beat his view?” he asks with a grin, gesturing toward the open blue water.
His grin is more than a little bit impish.
More than a year after he clobbered Riviera Beach by persuading the U.S. Supreme Court that the city illegally seized and destroyed his so-called houseboat, the 53-year-old self-made millionaire is back rattling city cages, trying to put that landmark decision into action.
He plunked down $24,000 this year for 29 acres of submerged land and about a third-acre of upland on the western shore of Singer Island. The pristine, mostly underwater property, will one day be home to a 60-foot-long floating home - a famous one that served as Frank Sinatra’s base of operations in the forgettable 1960 detective movie, “Lady in Cement,” he says.
But there’s more. Lozman wants neighbors. “My plan is to develop this into an upscale floating home community,” he says.
To the further chagrin of city officials, the man who has been a thorn in their sides since he moved to Riviera Beach roughly eight years ago is no longer a one-man wrecking crew.
Daniel Taylor, a 53-year-old Riviera Beach native, has recently reignited his family’s decades-long battle with the city for the right to use his submerged land as well. He, too, says it would be the perfect spot for a floating home.
With a nod to Lozman’s successful seven-year legal battle with the city, Taylor recently attached a name to his patch of land along the Intracoastal Waterway. He calls it “Lozman’s Cove.”
“I thought it was a heroic deed and I like the underdog,” he said, explaining why he honored Lozman by posting the street sign inside a fenced in area he turned into a picnic area for occasional parties.
Like Lozman, he said the U.S. Supreme Court’s decision paves the way for him to use the 2 acres of submerged land he owns that extends from his private picnic area.


Anonymous said...

What is fucked up about that is that a judge (as most do down here) can simply say "having considered the 3553 factors..." and sentence anywhere in the guidelines and up, but if they want to go down - better be precise.

Anybody who ever tells you our criminal justice system is fair is either an ignoramus, a judge or a prosecutor.

P. Guyotat said...

That wouldn't fly in the Eleventh Circuit. Writing for the court, Judge Jordan, I believe, recently vacated a below-guidelines sentence for a white-collar criminal as being unreasonable. And he is among the more moderate of the bunch.

Rumpole said...

Most of the case law equates the variance with the size, holding that the wider the variance from the G/Ls the more the court needs to justify it and the stricter the scrutiny This appears to be a Guinesss book world record variance.

Anonymous said...

sounds like she got the white woman variance.