Pierre also complains that the district court created unwarranted sentencing disparities when it sentenced him based on intended loss ($5.2 million) rather than actual loss ($1.2 million), because his co-conspirators received sentences based on the actual loss amount attributable to them. The guidelines direct the court to consider the greater of actual loss or intended loss, USSG § 2B1.1, comment. (n.3(A)), so there was no error in using the larger amount. The statutory direction to avoid unwarranted disparities among defendants, 18 U.S.C. § 3553(a)(6), refers to national disparities, not differences among co-conspirators, so Pierre's argument founders on a mistaken premise. See United States v. Fry, 792 F.3d 884, 892-93 (8th Cir. 2015). In any event, any disparity among co-conspirators here was warranted by Pierre's greater culpability in the conspiracy. Pierre was aware of the full scope of the conspiracy: he recruited co-conspirators to open several phony tax-preparation companies and bank accounts, and he directed them to deposit and withdraw money from the bank accounts. Most of the co-conspirators were associated with only a single fictitious company and bank account. The district court reasonably sentenced Pierre based on a greater amount of loss.For review, 18 USC § 3553(a), here, states the "Factors To Be Considered in Imposing a Sentence," including in subparagraph (6) "the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct." § 3553(b) requires the sentencing court to "impose a sentence of the kind, and within the range, referred to in subsection (a)(4) unless the court finds that there exists an aggravating or mitigating circumstance of a kind, or to a degree, not adequately taken into consideration by the Sentencing Commission in formulating the guidelines that should result in a sentence different from that described." As interpreted by Booker, the Court has ultimate discretion in applying the § 355a(a) factors to vary from the Guidelines.
The concurring judge, Kelly, disagreed that the majority should have reached the proper scope of the "unwarranted sentence disparities" command of 18 USC § 3553(a)(6). His concurring opinion is short, so I quote it in full:
Our court has not previously decided whether "[t]he statutory direction to avoid unwarranted disparities among defendants [in accordance with] 18 U.S.C. § 3553(a)(6) refers to national disparities [rather than] differences among co-conspirators." Supra at 8. See Fry, 792 F.3d at 892-93 (noting in dicta that "[m]ost courts say that the statutory direction to avoid unwarranted sentence disparities, see 18 U.S.C. § 3553(a)(6), refers to national disparities, not differences among co-conspirators" but affirming defendant's longer sentence as substantively reasonable when compared to sentences of other participants in fraud scheme because "disparate sentences among dissimilar defendants are not unwarranted") (emphasis omitted); United States v. Nshanian, 821 F.3d 1013, 1019 (8th Cir. 2016) (citing Fry, 792 F.3d at 892, but nonetheless "[a]ssuming for the sake of analysis that the statutory direction to avoid unwarranted sentence disparities might refer to differences among co-conspirators rather than national disparities"); United States v. Avalos, 817 F.3d 597, 602 (8th Cir. 2016) (citing Fry, 792 F.3d at 892-93, but "assuming for the sake of analysis that sentence disparities among co-conspirators could demonstrate unreasonableness"). In my view, there is no need to do so here, because any disparity between Pierre's sentence and those of his co-conspirators was warranted for the reasons stated by the court. For this reason, I concur in the result, but not in the conclusion regarding the proper scope of § 3553(a)(6). I otherwise concur in the court's opinion.For some more context, I thought I would first offer a quote from a Supreme Court case on § 3556(a)(6), then offer a discussion Judge Jack Weinstein by linking to a prior blog discussion, and then some quotes from some representative tax cases. I caution that these examples are more anecdotal to give readers some flavor for the analysis and are not intended to be exhaustive or even a fair representation of the § 3556(a)(6) authority:
Supreme Court Discussion:
Gall v. United States, 552 U.S. 38, 54 (2007)
Section 3553(a)(6) requires judges to consider “the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct.” The Court of Appeals stated that “the record does not show that the district court considered whether a sentence of probation would result in unwarranted disparities.” 446 F.3d, at 890. As with the seriousness of the offense conduct, avoidance of unwarranted disparities was clearly considered by the Sentencing Commission when setting the Guidelines ranges. Since the District Judge correctly calculated and carefully reviewed the Guidelines range, he necessarily gave significant weight and consideration to the need to avoid unwarranted disparities.Judge Jack Weinstein Discussion and Application:
Another UBS Depositor Sentence; Consideration of the Role of Potential Deportation (Federal Tax Crimes Blog 1/8/15), here, discussing Judge Weinstein's opinion in United States v. Gabella, 2014 U.S. Dist. LEXIS 176367 (ED NY 2014) and United States v. Chong, No. 13-CR-570, 2014 WL 4773978, at *13 (E.D.N.Y. Sept. 24, 2014).
Representative Tax Cases (Concluding with the Famous/Infamous Warner Case:
United States v. Bartlett, 567 F.3d 901,907-908 (7th Cir. 2009):
3. All three defendants contend that their sentences are unreasonably high when evaluated under the criteria in 18 U.S.C. §3553(a). They stress §3553(a)(6), which requires a sentencing judge to consider "the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct". Lemke, Clausing, Schabel, and Stromei all received sentences considerably less than 188 months; Bartlett, Spengler, and Masarik contend that this difference makes their sentences unreasonably high.
We have encountered this argument before and rejected it.
There would be considerably less cooperation--and thus more crime--if those who assist prosecutors could not receive lower sentences compared to those who fight to the last. Neither [United States v.] Booker[, 543 U.S. 220 (2005)] nor §3553(a)(6) removes the incentive for cooperation -- and because this incentive takes the form of a lower sentence for a cooperator than for an otherwise-identical defendant who does not cooperate, the reduction cannot be illegitimate. After all, §3553(a)(6) disallows "unwarranted sentence disparities" (emphasis added), not all sentence differences.
[T]he kind of "disparity" with which §3553(a)(6) is concerned is an unjustified difference across judges (or districts) rather than among defendants to a single case. If the national norm for first offenders who gain $ 275,000 or so by fraud is a sentence in the range of 33 to 41 months, then system-wide sentencing disparity will increase if Boscarino's sentence is reduced so that it comes closer to Aulenta's. Instead of one low sentence, there will be two low sentences. But why should one culprit receive a lower sentence than some otherwise-similar offender, just because the first is "lucky" enough to have a confederate turn state's evidence? Yet that is Boscarino's position, which has neither law nor logic to commend it.
Sentencing disparities are at their ebb when the Guidelines are followed, for the ranges are themselves designed to treat similar offenders similarly. That was the main goal of the Sentencing Reform Act. The more out-of-range sentences that judges impose after Booker, the more disparity there will be. A sentence within a properly ascertained range therefore cannot be treated as unreasonable by reference to §3553(a)(6).
United States v. Boscarino, 437 F.3d 634, 638 (7th Cir. 2006). Defendants acknowledge that the circuit's law is against them, but they contend that we must reevaluate the subject in light of Rita v. United States, 551 U.S. 338 (2007), Gall v. United States, 552 U.S. 38 (2007), and Kimbrough v. United States, 552 U.S. 85 (2007), which emphasized that the Guidelines are not binding and that district judges have considerable discretion to implement their own conceptions of just sentences, notwithstanding the Sentencing Commission's views. See also Spears v. United States, 129 S. Ct. 840 (2009); Nelson v. United States, 129 S. Ct. 890 (2009).
To address defendants' contention, we must separate two questions: first, does §3553(a)(6) require a judge to reduce anyone's sentence below the Guideline range because other persons who committed the same crime but pleaded guilty and cooperated received lower terms?; second, does §3553 as a whole permit a judge to go below the Guideline range for this reason?
The first of these questions received a negative answer in Boscarino and similar cases, which have observed that §3553(a)(6) addresses only "unwarranted" disparities. A difference justified by the fact that some wrongdoers have accepted responsibility and assisted the prosecution, while others have not, is not "unwarranted." The best way to curtail "unwarranted" disparities is to follow the Guidelines, which are designed to treat similar offenses and offenders similarly. Far from disapproving this understanding, the Supreme Court adopted it in Gall:
Section 3553(a)(6) requires judges to consider "the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct." The Court of Appeals stated that "the record does not show that the district court considered whether [*16] a sentence of probation would result in unwarranted disparities." 446 F.3d at 890. As with the seriousness of the offense conduct, avoidance of unwarranted disparities was clearly considered by the Sentencing Commission when setting the Guidelines ranges. Since the District Judge correctly calculated and carefully reviewed the Guidelines range, he necessarily gave significant weight and consideration to the need to avoid unwarranted disparities.
128 S. Ct. 586, 599 (emphasis added). A sentence within a Guideline range "necessarily" complies with §3553(a)(6).United States v. Hill, 683 F.3d 867, 871 (7th Cir. 2012)
Hill's final argument is that the district court created an unwarranted sentencing disparity between him and his co-defendant Davidson, who received a sentence of 6 months and 13 days, compared with Hill's 92–month sentence. We review the reasonableness of the district court's sentence for abuse of discretion. United States v. Favara, 615 F.3d 824, 829 (7th Cir.2010); United States v. Poetz, 582 F.3d 835, 837 (7th Cir.2009). A properly calculated within-Guidelines sentence is presumptively reasonable. United States v. Jackson, 547 F.3d 786, 792 (7th Cir. 2008); see also Rita v. United States, 551 U.S. 338, 127 S.Ct. 2456, 2462, 168 L.Ed.2d 203 (2007).
Section 3553 pertains to factors the court should consider when imposing a sentence. Subsection (a)(6) states that there is a “need to avoid unwarranted sentencing disparities among defendants with similar records who have been found guilty of similar conduct.” 18 U.S.C. § 3553(a)(6). Clearly, there is a disparity in Hill's and Davidson's sentences. However, Hill has failed to persuade us that the disparity was unwarranted. Hill had a criminal history category of VI, whereas Davidson had a criminal history category of I, a distinction significant enough to warrant disparity. Furthermore, Hill and Davidson engaged in different criminal conduct, all of which occurred under Hill's direction and leadership. The district court sufficiently considered the § 3553 sentencing factors when imposing the sentences, and the fact that the district court imposed a lesser sentence on his co-defendant does not negate the reasonableness of the sentence the court imposed on Hill.United States v. Floyd, 2014 U.S. App. LEXIS 253 (1st Cir. 2014) (conviction for a tax Klein/defraud conspiracy)
Dion frames his claim as a complaint about the substantive reasonableness of his sentence. The central premise of his complaint is that he was similarly situated to his coconspirators, yet sentenced more harshly. With this premise in place, he invokes a provision of the Sentencing Reform Act that directs a sentencing court to consider "the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct." 18 U.S.C. § 3553(a)(6).
Dion's premise is faulty in two salient respects. First, Dion focuses on the wrong universe. In enacting section 3553(a)(6), [*39] "Congress's concern was mainly with minimization of disparities among defendants nationally rather than with disparities among codefendants engaged in a common conspiracy." United States v. Vargas, 560 F.3d 45, 52 (1st Cir. 2009).
Second—and perhaps more important—Dion's premise is undercut by the record. The district court supportably found that Dion was more culpable than his coconspirators. * * * *United States v. Warner, 792 F.3d 847, 851, 862-863 (7th Cir. 2015) (footnotes omitted):
4. Sentencing Disparities
The government's final contention is that Warner's sentence creates "unwarranted sentence disparities" in violation of § 3553(a)(6). The government points to four former UBS clients who received prison terms of a year and a day with tax losses lower than Warner's: Peter Troost (who evaded approximately $1 million), Christopher Berg ($270,000), Federico Hernandez ($500,000), and Richard Werdiger ($400,000). The government insists that Warner should have received a prison term at least as long as theirs. The district court disagreed—again, because Warner is unique.
We uphold the district court's conclusion. Section 3553(a)(6) forbids not all sentencing disparities but only "unwarranted" ones "among defendants with similar records who have been found guilty of similar conduct." 18 U.S.C. § 3553(a)(6). Warner is not similar to the government's comparators. None of them offered evidence of significant charity or otherwise impressed the district court with their personal character, as Warner did. None of them, with the exception of Werdiger, tried to enter the OVDP or paid an FBAR penalty comparable to Warner's. Two of them were convicted on numerous counts: six in Werdiger's case, five in Hernandez's. And in all four instances the government sought a sentence within the advisory guidelines range. These were "mine run" cases. Rita, 551 U.S. at 351. Warner's case is not.
Furthermore, probation is a common sentence in offshore tax evasion cases. The evidence introduced below shows that roughly half of the defendants convicted since 2008 have received terms of probation rather than imprisonment. And, of course, thousands more have avoided criminal prosecution altogether by entering the OVDP. The government correctly emphasizes that the defendants sentenced to probation were different from Warner: for example, they caused smaller tax losses, and several of them gave more information to the government. But they are at least as similar as the government's comparators. Paul Zabczuk, for example, tried to disclose his offshore account through the OVDP, was rejected, and received three years' probation [37] despite the government's request for an 18-month prison sentence. And Igor Olenicoff hid millions of dollars in offshore accounts, paid the IRS $52 million, and received two years' probation based in part on his "exemplary community service" and "humanitarian causes." Both of them, however, caused much lower tax losses than Warner.
Ultimately, these examples prove the district court's point: Warner is unique, and neither side's comparisons are very helpful. As a result, his sentence does not cause any unwarranted disparities among similar defendants. And for the same reason, it does not restrict the government's ability to obtain a prison sentence in other, more typical cases, even where the tax loss at issue is less than Warner's.Addendum 9/8/17 8:30pm:
In my original posting, I did not discuss another holding that, upon reflection, I think is at least note worthy. The first argument was that the current conspiracy charge in Minnesota was unconstitutional double jeopardy because of a conspiracy charge in another district court (in Florida). The defendant's argument was the charged Florida conspiracy was the same conspiracy as charged in Minnesota. This raises the issue of the scope of a conspiracy. I have written before about scope. Some of the more important blog entries on the scope of the conspiracy involving actions that, depending upon how viewed, might be one conspiracy or more than one conspiracy. Prosecutors must recognize the issue and, I suspect, will find the concepts sufficiently malleable in close cases that they can charge either one or more than one conspiracy.
Blog entries on scope of a conspiracy (in reverse chronological order):=
- Pinkerton and Sentencing for Jointly Undertaken Activity; Proposed Sentencing Guidelines Amendment (Federal Tax Crimes Blog 4/17/15), here.
- Defraud Conspiracy Implicitly Included in Offense Conspiracy (Federal Tax Crimes Blog 2/14/12), here.
- DOJ Tax Finally Decides to Fold 'Em with the Rigas's (Federal Tax Crimes Blog 1/27/12), here.
- En Banc Rehearing in Rigas - Scope of Conspiracy, Totality, and Double Jeopardy (Federal Tax Crimes Blog 5/14/10), here.
- Scoping the Conspiracy - Concealment Money Laundering & Tax Reporting (Federal Tax Crimes Blog 3/13/09), here.
- Issue Preclusion #2 - Conspiracy Theories and Getting to Perhaps (Federal Tax Crimes Blog 10/28/09), here.
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