White Collar Alert

A defendant exercises his constitutional right to a jury trial and is proven guilty by a jury of his peers. The jury, confronted with multiple charges against the defendant, weighs the evidence and acquits on all counts, save one for which they find him guilty beyond a reasonable doubt. The judge at sentencing nonetheless sentences the defendant based not just on the one guilty count, but on the acquitted conduct, finding “by a preponderance of the evidence” that although the jury acquitted the defendant of those crimes, he, in fact, committed them and therefore should be sentenced to a much higher sentence as a result (although below the statutory maximum for the offense).

This can’t be right. An appeals court must surely reverse. And if not, the Supreme Court will certainly grant certiorari to fix it, right? Wrong.

Today, the Supreme Court denied certiorari in a case presenting this very question in United States v. Jones, over the dissent of Justices Scalia, Thomas, and Ginsburg (one short of the necessary number to hear the appeal). The facts of the case, as articulated by Justice Scalia, are as follows:

A jury convicted petitioners Joseph Jones, Desmond Thurston, and Antwuan Ball of distributing very small amounts of crack cocaine, and acquitted them of conspiring to distribute drugs. The sentencing judge, however, found that they had engaged in the charged conspiracy and, relying largely on that finding, imposed sentences that petitioners say were many times longer than those the Guidelines would otherwise have recommended.

Petitioners argued that, but for the judge’s fact finding, the sentence would be “substantively unreasonable” and a violation of the Sixth Amendment, which requires “that each element of a crime be either admitted by the defendant or proved to the jury beyond a reasonable doubt.” Justice Scalia noted that because any fact that increases a penalty to which a defendant is exposed constitutes an element of a crime (which must be found by a jury) and further that a “substantively unreasonable penalty is illegal,” that:

It unavoidably follows that any fact necessary to prevent a sentence from being substantively unreasonable – thereby exposing the defendant to the longer sentence – is an element that must be either admitted by the defendant or found by the jury. It may not be found by a judge.

So in other words, if a convicted defendant’s conduct is treated as a sentencing enhancer at sentencing (and but for that enhancement the sentence would be substantively unreasonable), then it must be either plead to or proven beyond a reasonable doubt.

After lamenting that the Court had not yet had the case before it to address this issue, and noting that the Court’s silence had led circuit courts to conclude that the Constitution does permit otherwise substantively unreasonable sentences so long as they are within the statutory range of the convicted offense, Justice Scalia concluded that “this has gone on long enough.” The Sentencing Guidelines range for the petitioners’ distribution charges was between 27 and 71 months, yet, as a result of the acquitted conspiracy charge, they were sentenced to 180, 194, and 225 months imprisonment.

While Jones addressed a crack cocaine conspiracy, the effect of including “acquitted conduct” in a defendant’s sentencing is equally applicable in white collar criminal cases, where a defendant’s sentence may depend greatly on such issues as the amount of the loss attributable to fraudulent conduct. In fact, at least two of the circuit court opinions cited by Justice Scalia for the proposition that the lower courts have viewed the Supreme Court’s silence on the issue as permitting such judicial fact-finding so long as the ultimate sentence is within the statutory range involve in what may be considered “white collar” crimes. See United States v. Treadwell, 593 F.3d 990, 1017-18 (9th Cir. 2010) (rejecting challenge of defendants convicted of Ponzi scheme); United States v. Redcorn, 528 F.3d 727, 745-46 (10th Cir. 2008) (rejecting challenge of chief financial officer convicted of health care fraud).

I’ll leave the analysis of why the Supreme Court declined to take up this case to perhaps the foremost expert on Supreme Court sentencing issues (and an author of an amicus brief in Jones), but needless to say the continued risk of acquitted conduct being used for sentencing purposes must be considered before trial. Let’s hope that the Court’s silence on this petition is not the final (unspoken) word by the Court.