Federal Sentencing Guidelines – New Standard is Reasonableness

Sentencing Guidelines

Below-the-Range Sentences: Appellate Review

 New York Law Journal
October 17, 2006

The U.S. Supreme Court’s decision in Booker ushered in a new era in sentencing not only because it rendered the Sentencing Guidelines “advisory,” but also because it introduced a new standard of review for sentencing decisions: reasonableness.

While questions of law are still reviewed de novo and findings of fact for clear error, Justice Stephen Breyer’s opinion excised the de novo review of departures introduced in 2003 by the Feeney Amendment, instead declaring that the ultimate sentence should be upheld unless it is “unreasonable.”

Although appeals of above-the-range, and even within-the-range, sentences far outnumber appeals of below-the-range sentences, a number of recent decisions have explored the lower bounds of reasonableness. For many courts, reasonableness is a question of degree: the farther a sentence is from the guideline range, the more scrutiny the court will apply.

A review of recent below-the-range cases in the U.S. Court of Appeals for the Second Circuit, however, reveals that in this circuit at least, post-Booker appellate review is effectively the same as it was pre-Feeney: absent an error of law or clearly erroneous finding of fact, such a sentence will not be overturned absent an abuse of discretion.

The Sliding Scale

A number of circuits around the country have adopted a sliding scale approach to reasonableness review of below-the-range sentences. For example, the U.S. Court of Appeals for the Eleventh Circuit, in United States v. Crisp1 and United States v. Martin,2 held that “[a]n extraordinary reduction must be supported by extraordinary circumstances.”3 The U.S. Court of Appeals for the First Circuit similarly adopted the position that reasonableness requires that the court “consider the reasonableness of a below-guideline sentence on a sliding scale: the farther the judge’s sentence departs from the guidelines sentence, the more compelling the justification based on factors in §3553(a) that the judge must offer.”4 Although “[a]n appellate court is not well suited to determine the appropriate sentence for a defendant,” the court held, “post-Booker appellate courts are tasked with drawing the line separating reasonable from unreasonable sentences.”5

The Second Circuit also has had the opportunity recently to review below-the-range sentences. In at least four such decisions, the court vacated and remanded for resentencing; yet the court appears to be affording more deference to the sentencing judge than its sister circuits. What follows is a look at those cases.

United States v. Thorn6

Joseph P. Thorn ran A+ Environmental Services Inc., an asbestos abatement company. A+ routinely submitted low bids for contracts on the assumption that it would employ illegal shortcuts, including failing to contain dust or provide protective gear and instructing workers to dump bags of loose asbestos.

Mr. Thorn was convicted of violating the Clean Air Act and money laundering. Chief Judge Frederick J. Scullin Jr. calculated an initial guidelines range of 235 to 293 months, but imposed a sentence of 65 months after departing to criminal history category I and granting a heartland departure because the money laundering was not incident to “a far-reaching scheme, such as drug trafficking or organized crime.”7

The Second Circuit reversed, requiring a more-detailed record to review the criminal history departure and instructing the district court to reconsider its heartland departure in light of United States v. McCarthy,8 which specifically held that money laundering may lie in the heartland of cases despite not involving drug trafficking or organized crime.

The district court again departed to a criminal history category of I and applied a heartland departure. The court concluded that Mr. Thorn’s prior unrelated convictions did not demonstrate a risk of recidivism. McCarthy, the court held, was distinguishable because the money laundering was not critical to the enterprise. This time, however, Judge Scullin imposed a 168-month sentence.

The Second Circuit held that sentence unreasonable. “A district court abuses or exceeds the discretion accorded to it when its decision rests on an error of law . . . a clearly erroneous factual finding, or . . . cannot be located within the range of permissible decisions.”9 The court held that the district court committed an error of law because the heartland departure rested on a misinterpretation of McCarthy. It further held that the district court had also “abused its discretion” in departing to criminal history category I because it failed to account for two previous civil cases involving similar bad acts. The court remanded again for resentencing, directing the district court not to depart on these grounds.

United States v. Rattoballi10

James Rattoballi successfully built his printing company into a $7-million-dollar-a-year business. Part of that success, however, resulted from a kickback scheme. Mr. Rattoballi traded clothing, gifts and cash to advertisers in exchange for contracts.

Mr. Rattoballi pleaded guilty to conspiracy to rig bids and to commit mail fraud. Judge Thomas P. Griesa calculated a guideline range of 27-33 months but imposed a sentence of one year home confinement and five years’ probation, citing Mr. Rattoballi’s ultimate “com[ing] clean” after withholding information from the government, the stigma of a felony conviction, the damage imprisonment would cause his business and his lesser culpability relative to one of the advertisers.

The Second Circuit reversed. The court specifically declined to adopt the sliding scale review evolving in other circuits. However, it held that the district court’s rationales were common to all defendants, reflected a lack of consideration for the Sentencing Commission’s policy statements regarding the need for imprisonment in antitrust cases, and impermissibly double-counted the reduction for acceptance of responsibility. Moreover, the court held it was clear error to conclude that Mr. Rattoballi’s business would be forced to close if he were imprisoned. Finally, the Court held that the guidelines already accounted for any disparity-the high end of the guideline range was less than half the advertiser’s sentence. The court held that by failing to justify the sentence with respect to the §3553(a) factors, the district court “exceeded the bounds of allowable discretion.”11 In so holding, the court stated more generally that its reasonableness review, “though deferential, will not equate to a ‘rubber stamp’” and that it will view as “inherently suspect” a sentence based on factors not unique to a particular defendant.12

United States v. Toohey’13

Timothy J. Toohey, a New York attorney, pleaded guilty to willfully underreporting his income. Mr. Toohey agreed to a guideline range of 15 to 21 months imprisonment but moved for a departure based on the extraordinary impact imprisonment would have on his business.

Judge John T. Elfvin imposed a sentence of two years’ probation. The court rejected Mr. Toohey’s requested departure but instead stated that incarceration would create disparity between Mr. Toohey’s sentence and that given to another, more-culpable attorney in an unspecified case. In a summary opinion, the Second Circuit vacated and remanded for resentencing, explaining that the district court’s opinion “lacked the [specific] explanation required by 18 USC §3553(c).”14

On remand, the district court imposed the same sentence, this time identifying the earlier case to which it had referred. The Second Circuit again vacated and remanded, holding that the sentencing opinion still lacked sufficient specificity for review and that it was error to view disparity by reference to one other case rather than “similarly situated defendants nationwide.”15

Judge Elfvin, understanding the Second Circuit’s opinion as mandating a term of imprisonment, imposed a sentence of 15 months. Mr. Toohey moved to correct the sentence, arguing that the Second Circuit’s opinion had specifically contemplated the possibility of a non-guideline sentence. Judge Elfvin refused, stating that the previous sentences were influenced by a prior friendship between the defendant and the judge and that the court was “correcting” that error by strictly following rather than “abus[ing]” the guidelines.16

The Second Circuit began by noting that its previous opinion had not mandated any specific sentence, but only required that the district court consider all of the 3553(a) factors in deciding upon a guideline or nonguideline sentence. The court viewed the district court’s statement that it does not abuse the guidelines as an indication that it had placed too much weight on the guidelines, especially in light of its misapprehension of the Second Circuit’s previous opinion. In light of Judge Elfvin’s acknowledged bias, the court remanded for resentencing before a different judge.

United States v. Castillo17

On March 24, 2004, Juan Castillo pleaded guilty to conspiring to distribute and distributing both crack and powder cocaine. At his sentencing, Mr. Castillo argued that the court should impose a sentence below his guideline range of 135-168 months because, following Booker, the court was “now free to ignore the harsher penalties imposed under the guidelines” for crack versus powder cocaine.18

Judge Robert W. Sweet agreed. The court concluded that the 100:1 ratio called for under the guidelines created an unwarranted disparity between those convicted of crack and powder cocaine offenses. He noted that the Sentencing Commission itself had proposed a more lenient 20:1 ratio and, following that suggested policy, he imposed a sentence of 87 months.

The Second Circuit reversed. The court noted that the 100:1 ratio was derived from the mandatory minimum sentences Congress adopted in the Anti-Drug Abuse Act of 1986. Although the Sentencing Commission had three times suggested reducing or eliminating the ratio, Congress had repeatedly rejected such proposals. Thus, the court concluded, Congress had made its intentions clear and the district court had committed an error of law by substituting its own policy judgment for Congress’ rather than grounding its sentencing decision on facts specific to Mr. Castillo’s case.

“Akin to Abuse of Discretion”

Prior to the Feeney Amendment, appellate courts were required to give “due deference” to a sentencing court’s application of the guidelines to the facts presented in a particular case. Previously, in United States v. Koon,19 the Supreme Court interpreted the due deference standard. “District courts have an institutional advantage over appellate courts in making these sorts of determinations,” the court held, “especially as they see so many more guidelines cases than appellate courts do.”20 Therefore, the court concluded, a district court’s sentencing decisions, other than errors of law or clearly erroneous factual determinations, were to be upheld unless they represented an abuse of discretion.

The Supreme Court’s observation is equally applicable to appeals of below-the-range sentences, at least in the Second Circuit. While several of its sister circuits view the distance of a sentence from the applicable guideline range as a heuristic for reasonableness, the Second Circuit is employing the deference it granted district court sentencing decisions pre-Feeney. This deference is reflected in the careful decision in each of the cases described above to isolate erroneous legal conclusions as the basis for the decision to remand and the court’s refusal to set an explicit lower bound or suggest a reasonable sentence. In fact, the court has expressly stated that “[r]easonableness review does not entail the substitution of our judgment for that of the sentencing judge. Rather, the standard is akin to review for abuse of discretion.”21

Nor should too much be read into the court’s multiple reversals of below-the-range sentences. The government is extremely selective about the sentencing decisions it appeals-for example, from October 2004 through September 2005, below-the-range sentences were imposed in more than 1,200 noncooperator cases in the Second Circuit,22 yet the government appealed only 19 of those sentences.23 In other words, the government generally appeals only those below-the-range sentences that it regards as most extreme, leaving the others undisturbed. Thus, the fact of multiple reversals in this small category of unusual cases cannot be taken as a sign that the Court of Appeals will routinely reverse below-the-range sentences.

Conclusion

The Second Circuit’s recent sentencing decisions do not represent a retreat from the principle that district courts have an institutional advantage in determining what a “reasonable” sentence is in a particular case. The Second Circuit appears ready to remand for resentencing only in the face of an error of law or fact or a record that demonstrates the judge’s failure to consider all of the 3553(a) factors. Nevertheless, these decisions serve as a reminder to defense counsel of the importance of presenting to the sentencing court all possible legitimate grounds for a below-the-range sentence in order to maximize the chances that such a sentence, if challenged, will be upheld as a reasonable, individualized exercise of discretion.

Alan Vinegrad, former United States Attorney for the Eastern District of New York, is a partner at Covington & Burling. Douglas Bloom is an associate at the firm.

Endnotes:

1. 454 F3d 1285 (11th Cir. 2006).

2. 455 F3d 1227 (11th Cir. 2006).

3. Crisp, 454 F.3d at 1291.

4. United States v. Thurston, 456 F.3d 211, 215 (1st Cir. 2006) (quoting United States v. Smith, 445 F.3d 1, 4 (1st Cir. 2006)) (internal quotations omitted).

5. Id. at 220; see also United States v. Moreland, 437 F.3d 424, 434 (4th Cir. 2006); United States v. Smith, 440 F.3d 704, 707 (5th Cir. 2006); United States v. Dean, 414 F.3d 725, 729 (7th Cir. 2005); United States v. Dalton, 404 F.3d 1029, 1033 (8th Cir. 2005).

6. 446 F.3d 378 (2d Cir. 2006).

7. Thorn, 446 F.3d at 390.

8. 271 F.3d 387 (2d Cir. 2001).

9. Thorn, 446 F.3d at 391 (quoting United States v. Brady, 417 F.3d 326, 322-23 (2d Cir. 2005)).

10. 452 F.3d 127 (2d Cir. 2006).

11. Id. at 137 (quoting United States v. Fernandez, 443 F.3d 19, 27 (2d Cir. 2006)).

12. Id. at 132-33.

13. 448 F.3d 542 (2d Cir. 2006).

14. United States v. Toohey, 85 Fed. Appx. 263, 263-64 (2d Cir. 2004).

15. United States v. Toohey, 132 Fed. Appx. 883, 886-87 (2d Cir. 2005).

16. Toohey, 448 F.3d at 544.

17. 460 F.3d 337 (2d Cir. 2006).

18. Id. at 342.

19. 518 U.S. 81 (1996).

20. Id. at 98.

21. United States v. Fernandez, 443 F.3d 19, 27 (2d Cir. 2006).

22. United States Sentencing Commission, 2005 Sourcebook of Federal Sentencing Statistics, Tables 26 and 26A, available at http://www.ussc.gov/ANNRPT/2005/SBTOC05.htm.

23. Id. at Table 56A.

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