Tuesday, September 23, 2008

Third Circuit Affirms One Variance to Probation; Reverses Another

Sentence Affirmed:

In United States v. Howe, No. 07-1404 (3d Cir. Sept. 18, 2008), defendant was convicted of two counts of wire fraud. At sentencing, the district court granted a variance from the recommended Sentencing Guidelines range of 18 to 24 months’ imprisonment and sentenced him to two years’ probation (including three months’ home confinement). In imposing sentence the district court stated that such a sentence best served the considerations of § 3553(a) and articulated numerous reasons: (1) Howe “led an honorable and lawful life until this point” and had no prior criminal history; (2) Howe “served in the U.S. Military for 20 years”; (3) Howe was a “well-regarded member of [his] community”; (4) Howe “regularly attend[s] church”; (5) Howe was a “devoted husband, father, and son”; (6) Howe made but an “isolated mistake” in committing his crime; and (7) Howe was remorseful at sentencing.

The government appealed. In affirming, the Circuit rejected the government’s claims of procedural error, first that the district court made erroneous findings as to the offense being an “isolated mistake” and that the defendant was remorseful - - refusing to parse the words of the district court or the defendant in such a way as to twist the district court’s intention or overrule it’s first-hand observations. The Court likewise found no procedural error in the brief mention given to general deterrence at sentencing where the government barely mentioned the subject and did not strenuously object on such grounds.

Next, the Court rejected the government’s claim that the sentence was a substantively unreasonable application of the factors on which the district court relied, noting that substantive review requires “taking into account the totality of the circumstances”and the long list of reasons given by the district court. The Court also specifically rejected the government’s argument that, in terms of a variance for acceptance, a sentencing allocution could not overcome the fact that Howe had gone to trial and recognized military service as a valid consideration.

Sentence Reversed:

In United States v. Levinson, No. 07-1544 (3d Cir. Sept. 18, 2008), defendant pleaded guilty to one count of wire fraud and one count of filing a false income tax return. At sentencing, the district court granted a variance from the recommended Sentencing Guidelines range of 24 to 30 months of imprisonment and sentenced him to two concurrent 24-month terms of probation. In doing so, the district court considered the § 3553(a) factors. Although the court did not find any characteristics which distinguished Levinson from other criminals, it did, however, determine that Levinson's case could be distinguished from other cases involving white-collar crime because his victim was not the public at large but was instead a private business entity that had already settled its civil lawsuit against Levinson. The court went on to consider the “propriety of putting into jail at a substantial cost to the public a nonviolent offender who poses little or no threat to the public and whose crimes had little impact beyond his business partners and his family”. Finally the court concluded that probation was more appropriate.

The government appealed, arguing that the district court failed to adequately explain the chosen sentence. The Third Circuit agreed and vacated Levinson’s sentence. The Circuit held first, the court clearly erred in finding that defendant had inflicted no financial harm on the public when there was a tax fraud conviction involving a specific dollar loss to the United States Treasury, and second, the court failed to provide adequate explanation for varying downward from a sentencing guidelines range of 24 to 30 months.

The Court found that a more complete explanation of the decision to significantly vary from the recommended sentence of imprisonment was required in that first, after stating that Levinson did not differ from other defendants, the court failed to explain a basis that would warrant such a variance. Second, if there is no real distinction between the defendant and other white-collar defendants, and the district court rested its decision on a policy disagreement with the Guidelines, - - noting the court’s comments about cost, public and private harm, and consideration of general penal policy - - the court must explain why the general policy should not apply in the particular case before it. While acknowledging that “policy considerations are not off-limits in sentencing,” the Circuit expressed some reluctance and concern that the district court had not accounted for “very deliberate policy choices embedded in the Guidelines”.

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