Free Response in Opposition - District Court of Colorado - Colorado

Case 1:04-cr-00103-REB

Document 1506

Filed 04/28/2008

Page 1 of 6

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Criminal Action No. 04-cr-00103-REB-01 UNITED STATES OF AMERICA, Plaintiff, v 1. NORMAN SCHMIDT, Defendant, _____________________________________________________________________ GOVERNMENT'S RESPONSE TO DEFENDANT NORMAN SCHMIDT'S MOTION FOR VARIANCE FROM A GUIDELINE SENTENCE [#1503] _____________________________________________________________________ The government, by Wyatt Angelo and Matthew T. Kirsch, Assistant United States Attorneys, respectfully requests that the Court deny the defendant's motion for a variance from the Guideline sentence to a sentence of 25 years. The reasons for that position are below: 1. The Probation Officer has correctly calculated the defendant's Guideline range as life in prison. She recommends a sentence of 330 years both as a reasonable substitute to achieve a total punishment approximating a life sentence, as required by United States Sentencing Guideline Section 5G1.2(d), and based on her analysis of the sentencing factors in Section 3553(a). The government does not disagree with either analysis. 2. The defendant's motion is based solely on one of the many sentencing factors outlined in Section 3553(a), specifically, "the need to avoid unwarranted sentence disparities among defendants with similar records who have been

Case 1:04-cr-00103-REB

Document 1506

Filed 04/28/2008

Page 2 of 6

found guilty of similar conduct," 18 U.S.C. § 3553(a)(6), to the exclusion of all of the other factors set forth in this section. The defendant asserts that variance is necessary to avoid the kind of sentencing disparities described in this subsection, and he relies on anecdotal information concerning sentences imposed in other state and federal fraud cases.1 3. One of the problems with the defendant's list of supposedly similar cases is that it omits information about many of the factors required by Section 3553 to be considered by a court when imposing sentence, e.g., applicable Sentencing Guideline calculations, the defendant's criminal history, whether conviction was by plea or after trial, whether a defendant cooperated and, if so, the amount and value of the defendant's cooperation, or whether other grounds for a downward departure or variance existed. These problems with defendant's approach illustrate why Mark Twain once described the three kinds of lies as "lies, damned lies, and statistics." The type of statistics on which the defendant would have the Court rely are only valuable if the important variables on which they are based are known. 4. As a further illustration of the problem of anecdotal comparison, the government has attached a chart of sentences imposed in fraud cases from around the country. This data was gathered by in 2006 by the U.S. Attorney's Office in the

As one illustration of the anecdotal nature of the defendant's list, the government notes the omission from the list of the well publicized sentence of 100 years imposed on a first-time securities fraud offender in Denver District Court and affirmed by the Colorado Court of Appeals in State v. Hoover, 165 P.3d 784, 802-804 (Colo. Ct. App. 2006). 2

1

Case 1:04-cr-00103-REB

Document 1506

Filed 04/28/2008

Page 3 of 6

Southern District of California, when that office sent an email throughout the Department of Justice soliciting sentencing information on fraud defendants in Criminal History Category I who had received sentences of 180 months or more. That office then gathered supporting documentation for those sentences, including indictments, plea agreements, judgments, appellate decisions, and news accounts. The results of that survey, as updated by this U.S. Attorney's Office and contained in Attachment 1, provide numerous examples of fraud defendants receiving very lengthy sentences. 5. As Attachment 1 shows, the defendant's argument that the recommended sentence in this case is "completely inconsistent with sentences of defendants for similar conduct," (Def.'s Mot. ¶ 31), rests on shaky footing at best. Most importantly, the argument ignores or minimizes this Court's obligation to consider whether persons convicted of similar conduct also have "similar records" for the purposes of analysis under 18 U.S.C. § 3553(a)(6). Defendant Schmidt's Criminal History Category has been calculated to be IV. As noted above, all of the defendants in Attachment A were in Criminal History Category I. It is a safe assumption that none of the corporate leaders whose sentences are referenced only in the defendant's motion have anywhere near the lengthy criminal history and ingravescent criminal conduct that he does. A disparity between a higher sentence imposed on defendant Schmidt, with his lengthy criminal history, and the still lengthy sentences imposed on various other fraud defendants with no criminal history, is hardly "unwarranted." Id. 6. The defendant's attempted dismissal of the recommended sentence as "more 3

Case 1:04-cr-00103-REB

Document 1506

Filed 04/28/2008

Page 4 of 6

theatrical than practical," (Def.'s Mot. ¶ 31), completely ignores the impact of an appropriately lengthy sentence in deterring others from engaging in this most popular of frauds. See 18 U.S.C. § 3553(a)(2)(B). His motion also fails to address the appropriateness of the recommended sentences under any of the other statutory factors, such as the need for the sentence imposed "to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense, id. § 3553(a)(2)(A), which could conceivably outweigh the single factor, the need to avoid unwarranted sentencing disparities, on which he relies. See United States v. Smart, 518 F.3d 800, 808 (10th Cir. 2008) (noting that the weight a district court assigns to the various Section 3553(a) factors must be given due deference on appeal). The presentence report has clearly addressed these other sentencing factors. 7. The defendant claims that a sentence that would incarcerate him beyond the age of 100 "threatens to make a mockery of the federal sentencing process." (Def.'s Mot. ¶ 34). In fact, the opposite is true. The 25-year sentence requested by the defendant ignores fact that the Sentencing Guidelines "reflect the fact that the Sentencing Commission examined tens of thousands of sentences and worked with the help of many others in the law enforcement community over a long period of time in an effort to fulfill [its] statutory mandate" of carrying out all of the statutory sentencing purposes reflected in Section 3553(a). Rita v. United States, 127 S. Ct. 2456, 2457 (2007). The type of major deviation from the Guidelines requested by the defendant would need to be supported by a

4

Case 1:04-cr-00103-REB

Document 1506

Filed 04/28/2008

Page 5 of 6

significant justification. Gall v. United States, 128 S. Ct. 586, 597 (2007); Smart, 518 F.3d at 807. The defendant has not offered any such justification. A sentence akin to that proposed by the Probation Office, however, is appropriate based on a contextual evaluation of all of the Section 3553(a) factors. See Smart, 518 F.3d at 518. 8. If the Court, based on its individualized consideration of defendant Schmidt in light of all of the Section 3553(a) factors, is inclined to grant him some variance from the applicable Guideline range, the government suggests that any variance should result in a sentence of not less than 100 years. Such a sentence would still constitute a variance of 70% below the advisory Guideline sentence. Respectfully submitted this 28th day of April, 2008, TROY A. EID United States Attorney

s/ Matthew T. Kirsch WYATT ANGELO MATTHEW T. KIRSCH Assistant U.S. Attorneys 1225 17th Street, Suite 700 Denver, CO 80202 Telephone 303-454-0100 Facsimile 303-454-0402 email: [email protected] [email protected] Attorneys for the Government

5

Case 1:04-cr-00103-REB

Document 1506

Filed 04/28/2008

Page 6 of 6

CERTIFICATE OF SERVICE (CM/ECF) I hereby certify on this 28th day of April, 2008, I electronically filed the foregoing GOVERNMENT'S RESPONSE TO DEFENDANT NORMAN SCHMIDT'S MOTION FOR VARIANCE FROM A GUIDELINE SENTENCE [#1503] with the Clerk of the Court using the CM/ECF system which will send notification of such filing to the following email addresses:

Peter Bornstein, Esq. [email protected] Thomas Hammond, Esq. [email protected] Ronald Gainor, Esq. [email protected]

Richard N. Stuckey, Esq. [email protected] Thomas Goodreid, Esq. [email protected]

and I hereby certify that I have emailed the document to the following participants: Senior U.S. Probation Officer Caryl Ricca United States Probation Office 1929 Stout Street, Suite C-120 Denver, CO 80294-0101

s/ Matthew T. Kirsch MATTHEW T. KIRSCH U.S. Attorney's Office 1225 17th Street, Suite 700 Denver, CO 80202 Telephone 303-454-0100 Facsimile 303-454-0402 E-mail [email protected] Attorney for the Government

6