Multi-million-dollar-fraud sentencing: How can you seek a reasonable sentence when the sentencing range will be driven by the high loss amount?

Your client has been convicted of a financial crime, and the high loss amounts—perhaps in the tens of millions of dollars—are driving the possible sentencing range to an extreme. How do you argue for a reasonable sentence?

I recently posted about a successful Sixth Circuit appeal in a $70 million credit-union collapse. After remand back to the sentencing judge, I filed this Sentencing Memorandum, contending that the fraud Guidelines under §2B1.1 are too severely influenced by the loss amount. Excerpts of that memorandum appear below, including (i) statistics from the U.S. Sentencing Commission regarding the average sentences imposed relative to the Guideline range, and (ii) a detailed chart compiled at the Federal Defender website showing sentences imposed for many of the most-famous financial crimes in the country—many of those sentences were below the Guidelines range. In this case, the initial sentence of 18 years was reduced to 10 after the successful appeal.

Audio of oral argument: Responding to a judge who is aggressively asking questions...

I recently posted about a successful appeal involving consecutive versus concurrent sentencing in a white-collar criminal case. The Sixth Circuit panel was Judges Clay, Rogers, and Ludington. Judge Rogers was particularly active, asking tough (but fair) questions of both sides. There was not always much room for me to respond, and I think this oral argument illustrates how to attempt to stick to your main points while conceding what you should concede when a judge is really pushing you. The panel ultimately ruled for my client in this opinion.

The funniest moment occurs at 22:50.  The government lawyer was contending that there was no confusion about whether the sentencing judge misspoke and meant to say "concurrent" instead of "consecutive" and then the lawyer misspoke and mixed up those very terms. 

Consecutive versus concurrent sentencing in federal court--and a reversal by an appellate court where the distinction wasn't clear.

In the aftermath of a $70 million collapse of a credit union near Cleveland, Ohio, I appealed the sentence of a man who had entered a guilty plea regarding the receipt of fraudulent loans. At issue was whether the judge's imposition of "consecutive" sentences (i.e., sentences stacked on top of each other, as opposed to running "concurrently") was proper--or even intended in the first place.  This turned a 10-year sentence into an 18-year sentence. The appeal took place in 2013. I filed this opening brief, the government filed this opposition, and I filed this reply. This is the audio of the oral argument in the Sixth Circuit. The Sixth Circuit agreed that the sentence was procedurally unreasonable, and it remanded back to the district judge for a new sentencing proceeding. United States v. Nikolovski, No. 12-3679. I then filed this sentencing memorandum, and my client's sentence was then reduced from 18 years to 10 years.

What follows are excerpts of my opening brief to the Sixth Circuit regarding principles of concurrent versus consecutive sentencing in federal court.

When new facts in a second lawsuit overcome the defense of res judicata (claim preclusion).

In 2010, I filed this brief in the Sixth Circuit explaining how a second lawsuit can proceed with similar claims as presented in an earlier, dismissed suit, when the second suit has sufficiently new facts. With the right new facts, res judicata does not bar that second suit. Here is the opposition brief, and here is the reply brief. The Sixth Circuit agreed with my argument in this opinion. This particular case involved a family that lived near an airport and brought suit for damages based on runway expansions near their home. State of Ohio ex rel. Susan Boggs, et al. v. City of Cleveland, 655 F.3d 516 (6th Cir. 2011). What follows are excerpts of the main brief on this point:

Should Iqbal Be Overturned?

We are now a decade into the Twombly/Iqbal world, yet confusion and contradictions about the basic pleading standards for all civil cases in the nation remain.  This is especially true because it is not clear whether the Supreme Court overruled its 2002 Swierkiewicz decision, which unanimously set forth and applied the familiar pleading standards under Rule 8.  See, e.g.Franks v. Vill. of Bolivar, No. 11-701, 2011 U.S. Dist. LEXIS 133740, at *10 n.2 (N.D. Ohio Nov. 18, 2011) (“The lower courts in this circuit have grappled with whether the holding of Swierkiewicz remains good law in light of Twombly and Iqbal”); Jianjun Xie v. Oakland Unified Sch. Dist., No. 12-2950, 2013 U.S. Dist. LEXIS 29898, at *11 n.3 (N.D. Cal. March 5, 2013) (“The effect of Twombly and Iqbal on Swierkiewicz is complex and controversial . . . .”).

The title of this post is the Question Presented in a Petition for Certiorari I filed in 2014 in D'Ambrosio v. Marino, No. 14-393.  The petition explains the development of the pleading standards and contends that, while Twombly is good law, Iqbal should be overruled as contrary to Rule 8.  This approach is based largely on Luke Meier's article, Why Twombly Is Good Law (But Poorly Drafted) and Iqbal Will Be Overturned, 87 Ind. L.J. 709 (2012).

An excerpt of the Petition is below.  My co-counsel and I represented Joe D’Ambrosio, a former death-row inmate who was freed after prosecutors withheld Brady evidence.  We brought a section 1983 suit against the County Prosecutors Office, but the lower courts rejected our claims based on Iqbal, before we were allowed to conduct further discovery. Here is the full Petition, the Opposition of the County, Opposition of the City, and our Reply.

Do you have a "vehicle" problem for Supreme Court review when the court below did not address a separate issue that could also bar you from relief? Probably not...

You have lost in the court of appeals.  But the issue you lost on is a great candidate for Supreme Court review, so you file a petition for certiorari with that issue as the Question Presented.  The other side then opposes your petition.  Part of their argument is that, regardless of your Question Presented, the case is a bad "vehicle" for the Supreme Court because there is a separate issue in the case--not addressed by the court below--that also bars you from relief.  In other words, they are saying something like this: "Who cares about this cert issue--there's a separate problem with this particular case and the Supreme Court therefore shouldn't waste its precious time here, so cert should be denied."  

But there is a good chance that this is not a real vehicle problem.  The Supreme Court frequently takes cases that involve a separate issue that was not addressed by the court below and that may indeed be dispositive of the underlying relief you seek.  When that occurs, the Court reviews the main issue raised and simply remands the case to the court below for resolution of that second issue your opponents keep bringing up.

This concept is the centerpiece of cert-stage briefing I filed at the Supreme Court in 2016 in McNeese v. United States, No. 16-66.  The substantive issues are discussed in this post.  The Petition raised a circuit split regarding a criminal defendant's ability to seek a sentencing reduction after entering a binding plea.  The Department of Justice's Opposition acknowledged the split, but argued that a separate issue would bar my client from the sentencing reduction anyway.  Thus, they said, there is a "vehicle" problem.  What follows is the text of my Reply, which counters that there is no vehicle problem in that context.  The Court ultimately denied certiorari, but the Reply provides a framework to counter the "vehicle" argument.

The circuit split regarding Freeman v. United States: Can a criminal defendant seek a lower sentence under a retroactive sentencing amendment if that defendant entered a binding plea agreement?

The following are excerpts of a Petition for a Writ of Certiorari I filed in the Supreme Court in 2016 in McNeese v. United States, No. 16-66.  The Government filed this Opposition, and I filed this Reply.  The Court denied certiorari.    


The circuits are fully split ten to two whether Justice Sotomayor’s concurring opinion in Freeman v. United States, 546 U.S. 522 (2011), is the controlling opinion of the Court.  Freeman is a 4-1-4 decision regarding whether a defendant is eligible to seek a lower sentence under a retroactive sentencing amendment if that defendant had entered a binding plea agreement.  The en banc Ninth Circuit just answered this question, joining the D.C. Circuit and voting 10-1 that Justice Sotomayor’s opinion is not controlling—in conflict with ten circuits, including the court below.  See United States v. Davis, No. 13-30133, 2016 U.S. App. LEXIS 10661 (9th Cir. June 13, 2016) (en banc).

The question presented is as follows: 

Is Justice Sotomayor’s concurring opinion in Freeman the controlling opinion of the Court?

When a federal appeals court rules in your favor and remands for further proceedings, can the district court stop those proceedings while the other side seeks review in the U.S. Supreme Court?

You've recently won your federal appeal.  The other side sought rehearing but was unsuccessful.  Then they asked the appeals court to stay its mandate while they tried to seek review in the U.S. Supreme Court, but you successfully opposed that effort as well.  So the mandate issued.  [See this post for discussion of that process.]

But the case isn't completely over--the appeals court also remanded certain aspects of it back to the district court.  And the other side is now telling the district court to stay any remand proceedings while they seek review in the U.S. Supreme Court.  Does the district court have any authority to do so?  And if there is a defined amount of money damages due under the appellate court's ruling, is the defendant now obligated to pay?  And what if the defendant posted a bond for that amount--can you move under Rule 65.1 to force the surety to pay?

The answer to these questions are discussed in this brief I filed in the district court in 2016 with co-counsel Michael Pasternak after we obtained a reversal and remand from the Sixth Circuit in Cranpark, Inc. v. Rogers Group, Inc.  This is the opposition brief filed by the other side, and this is our reply.  Additionally, here is the Rule 65.1 motion that was filed with the brief (seeking to force the surety to pay amounts owed on the supersedeas bond).  This is the Rule 65.1 opposition by the surety, and this is our Rule 65.1 reply.

Excerpts of our main brief and our reply appear below.

Staying the Mandate of an Appellate Court While Seeking Certiorari (Translation: stopping the appellate court judgment from going into effect while trying to go to the U.S. Supreme Court)

I recently posted about a Sixth Circuit case in which the court issued an opinion reinstating a jury verdict in our client's favor.  But an appellate court's opinion does not immediately go into effect--there is time for the losing party to seek rehearing or rehearing en banc.  Only when that process concludes (or the time for it expires) does the official "mandate" issue--that mandate is what puts the opinion and judgment of the court into effect.  In our case, the losing party sought en banc review, which the court denied.  At that point, the losing party sought the extraordinary relief of staying the mandate.  They sought to stop issuance of the official mandate while they pursued an effort to seek review of the case by the U.S. Supreme Court.  Their stay motion is here.  Our opposition to their stay motion is here.  The Court denied their motion, and the mandate issued. 

What follows is the text of the brief I filed to oppose the motion to stay the mandate.