Monday, April 20, 2009

Closely Divided En Banc Court Affirms “Gilded Cage” Sentence: Gall requires great deference to district court sentencing decisions

In United States v. Tomko, __ F.3d __, 2009 WL 1025876 (3d Cir. April 17, 2009) (en banc), the en banc Court (8-5) issued an important post-Gall opinion, reaffirming the principle that "[t]he fact that the appellate court might reasonably have concluded that a different sentence was appropriate is insufficient to justify reversal of the district court." Gall v. United States, __ U.S. __, 128 S. Ct. 586, 597 (2007). Judge Smith wrote the opinion affirming the district court’s sentence, and was joined in the majority by McKee, Barry, Ambro, Fuentes, Chagares, Hardiman, and Jordan.

The district court had sentenced Tomko, a first-time, white collar, tax fraud defendant to three years of probation (the first of which to be served in home detention), 250 hours of community service, and the statutory maximum fine of $250,000. The advisory Guidelines had called for a prison sentence of 12-18 months and a fine of $3000-30,000. When the case was first reviewed, the panel reversed the sentence, finding it procedurally unreasonable, because the district court did not adequately address the need for general deterrence, and substantively unreasonable, because instead of prison, the court sentenced Tomko to serve home detention in the mansion that was at the center of the tax fraud.

Noting that "[if] any one of a significant number of the members of this Court – including some in today’s majority – had been sitting as the District Judge, Tomko would have been sentenced to some time in prison," the en banc court nonetheless deferred to the sentencing judge, citing Gall’s reasoning that "the sentencing judge is in a superior position" to determine the appropriate sentence. Gall, 128 S. Ct. at 597. "It will be a rare case," the Court stated, "when it is clear that no acceptable reasoning can justify a given sentence. This is not one of them."

The record made clear that the district court had considered the government’s arguments that (1) crimes like Tomko’s deserved imprisonment; and (2) a non-prison sentence would send the message that wealthy offenders could buy their way out of prison. The record also contained support for the variance granted. Indeed, the Court found significant that the government had not disputed any of the facts cited by the district court in support of its sentence – Tomko’s status as a first-time offender, his philanthropic efforts, and the threat that his incarceration would pose to his 300 employees. The district court’s basing the sentence on these facts was "logical and consistent with the factors set forth in section 3553(a)."

The Court did not take the opportunity presented by the defense bar’s amicus brief to examine the irrationality of the Sentencing Guidelines’ treatment of white collar crimes. Nor did it address the question whether the Guidelines improperly limit the use of probationary sentences. The Court did emphasize, however, that the variance in Tomko’s case – twelve months – "was not substantial."

Five members of the en banc court, led by Judge Fisher, dissented (Rendell, Scirica, Sloviter & Cowen). The dissenters were concerned that the facts relied upon by the district court did not distinguish Tomko from other tax evaders. Congress and the Commission intended that "mine-run" fraud offenders like Tomko receive prison sentences. White-collar criminals had historically been underpunished, and both the Sentencing Reform Act and the Guidelines aimed to remedy that. It criticized the district court for granting a variance based on factors that were discouraged by both the SRA and the Guidelines. Gall, the dissent argued, approved a variance under very special circumstances – a youthful conspirator who had withdrawn from his life of crime and become a responsible adult. Other co-conspirators had been punished harshly enough that deterrence was not compromised by the variance in Gall, the way it would be here. The dissent also declined to address the defense bar’s amicus arguments.

PRACTICE TIP: A copy of the amicus brief attacking the white collar crime Guidelines and defending probationary sentences as consistent with the SRA and § 3553(a) is available at http://www.fd.org./

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