Thursday, October 29, 2020

Court of Appeals Finds No Harm Attorney's Failure to Assure Client Understood Relevant Conduct for Sentencing Loss Calculations (10/29/30)

In Jones v. United States, 2020 U.S. App. LEXIS 33857 (6th Cir. 2020), unpublished, here, the Court by Order denied Jones’ request for a certificate of appealability ("COA") from the district court’s denial of a motion under 28 USC § 2255 to vacate, set aside or correct his sentence.  The Order rejected Jones’ allegations of ineffective assistance of counsel, a common complaint in § 2255 motions.

The Court reasoned (cleaned up)

A COA may issue “only if the applicant has made a substantial showing of the denial of a constitutional right." 28 U.S.C. § 2253(c)(2). When the district court's denial is based on the merits, the petitioner must demonstrate that reasonable jurists would find the district court's assessment of the constitutional claims debatable or wrong.

Reasonable jurists would not debate the district court's determination that trial counsel did not render ineffective assistance. To establish ineffective assistance of counsel, a defendant must show deficient performance and resulting prejudice. Strickland v. Washington, 466 U.S. 668, 687 (1984). The performance inquiry requires the defendant to show that counsel's representation fell below an objective standard of reasonableness. In the context of a guilty plea, the prejudice inquiry requires the defendant to show that there is a reasonable probability that, but for counsel's errors, he would not have pleaded guilty and would have insisted on going to trial. The test is objective, not subjective; and thus, to obtain relief on this type of claim, a petitioner must convince the court that a decision to reject the plea bargain would have  been rational under the circumstances.  With respect to claims of ineffective assistance of counsel during sentencing, prejudice is established if the movant demonstrates that his sentence was increased by the deficient performance of his attorney.

Reasonable jurists could not debate the district court's ruling that Jones failed to establish prejudice from counsel's alleged failure to advise him that the loss amount would include loss from relevant conduct not charged in the counts to which he pleaded guilty. Jones claimed that he discovered only after reviewing the presentence report that, because of the relevant conduct he would receive a 16-point increase in his offense level under USSG § 2B1.1(b)(1)(I). Jones also notes that counsel acknowledged that a psychologist testified on his behalf during sentencing, and that the psychologist explained that Jones had difficulty understanding "how things worked and was often confused. . . about the positions that the government took, as well as some of the things that took place." Therefore, he contends that counsel “should have taken extra steps . . . to ensure that [he] understood [the plea agreement]" before signing it. He also argues that he made a substantial showing that he would not have accepted the plea offer had he been made aware that pleading guilty would increase the amount of restitution by 2 million dollars. Because Jones claims that he would have proceeded to trial had counsel accurately advised him of his sentence exposure, he was required to establish that a decision to reject the plea bargain would have been rational under the circumstances.

Reasonable jurists would agree with the district court's conclusion that, in light of the strong case against Jones and his failure to cite any evidence that he had a viable defense to the twenty-five counts brought against him, he failed to establish that it would have been rational for him to proceed to trial had he known of the potential increase in his offense level and restitution amount. A petitioner must produce contemporaneous evidence that suggests that, absent counsel's allegedly deficient performance, he would have elected to proceed to trial instead of accepting the plea agreement. Moreover, at the plea hearing, Jones admitted the accuracy of the statement of facts attached to his plea agreement, and he acknowledged that the applicable guidelines range was not a guarantee of his eventual sentence. In these circumstances, knowledge that his guidelines range might be higher than anticipated—a fact that would be true regardless of whether he pleaded guilty or was found guilty at trial—would not make it rational for a defendant to abandon his plea agreement and risk conviction on twenty-two additional counts. Reasonable jurists could not debate that Jones failed to establish prejudice.

JAT Comments:

1. The Order is pretty cryptic as to what precisely happened.  Jones was charged with 25 counts and pled guilty to 3 counts -- “mail fraud, in violation of 18 U.S.C. § 1341 (count 10), engaging in monetary transactions in property derived from specified unlawful activity, in violation of 18 U.S.C. § 1957 (count 21), and failure to file an income tax return, in violation of 26 U.S.C. § 7203 (count 23).”  He received a sentence of 74 months, which was a Guidelines range sentence well within the maximum for those counts.  The loss determination for the Guidelines calculation apparently included the relevant conduct for the counts the Government dismissed under the plea agreement.  

2. This Order may be useful for students and younger practitioners in considering the effect of “relevant conduct” in the Guidelines calculations.  The use of relevant conduct in the Guidelines calculations means that, for run of the mine cases, the dismissal of counts may achieve no benefit for the defendant whatever, so long as the counts to which the defendant pled produces an aggregate maximum sentence with stacking exceeding the Guidelines calculation.  The PSR will usually note that the same Guidelines calculation would apply even if the defendant had been convicted of all counts (including the dismissed counts).  Obviously, it is critical in such cases for counsel to properly advise the defendant of that phenomenon of no sentencing benefit from dismissed counts.

3.  Indeed, the relevant conduct phenomenon sweeps broader than dismissed counts but can include uncharged crimes and crimes outside the statute of limitations.  Counsel need to keep that in mind as well.  

For example, assume the following:

  • A taxpayer had an offshore account which had a steady balance of $1,000,000 for the years from 1980 through 2020.  On that account, the average earnings was $30,000 and the average tax liability was $7,500.  So, the tax loss through 2017 (the last year he omitted the income and failed to file FBARs) is $285,000.  
  • The taxpayer is charged in 2020 with three counts of tax perjury (3 year felony) and two counts of failure to file FBARs (5 year felony).  His maximum incarceration if convicted of all counts of conviction is 19 years.  (Note if the Government charged tax evasion (5 year felony) rather than tax perjury, the maximum incarceration period would be 25 years.) 
With those bare facts (very simple to illustrate) here are some Guidelines calculations using the tax Guidelines:


Tax Loss

Tax Table Offense Level

Sentencing Level (Assume sophisticated means and acceptance of responsibility)

Range in months

All counts charged





Counts Pled (1 tax perjury and 1 FBAR)





All years (Including not charge back to 1980)





I have considered only the tax loss calculations on the Guidelines calculations and have not considered the calculation of the Guidelines if the fraud loss Guidelines applied as a result of the FBAR conviction.

Thus, as you can see, the inclusion of relevant conduct can be material.

4. Going back to the Order in Jones, with the inclusion of the relevant conduct for the charged and dismissed counts, it seems that the only benefit to Jones from pleading guilty was acceptance of responsibility.  Using the illustrative figures in the hypothetical, without acceptance of responsibility, the sentencing level would have been 20 and range would have been 33-41 months.  So, by pleading and thereby achieving the acceptance of responsibility (even with inclusion of all relevant conduct), a defendant gets a substantial benefit even though his tax loss was not affected.  If he really had no practical defense, he logically should have taken the plea (as he did) and was not prejudiced by doing so.

5.  Often, because of difficulty in calculated some the tax loss for some of the really old tax years, in the plea discussions the prosecutors might be willing to be somewhat generous in favor of the taxpayer in the tax loss calculations reflected in the plea agreement in order to sweeten the pie for a plea.  So that is worth pursuing in plea negotiations.  Of course, the Probation Office and the sentencing court are not bound by such agreements as to the tax loss, but in most cases it is unlikely that they will go behind the agreements as to the loss.

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