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February 3, 2010

Notable student note on loss calculations under the federal guidelines

Anyone working on white-collar sentencing issues in the federal system will want to check out this new student note in the Duke Law Review, which is titled "Losing the Loss Calculation: Toward a More Just Sentencing Regime in White-Collar Criminal Cases."  Here is the Note's abstract:

The sentencing regime that governs white-collar criminal cases requires reform. The U.S. Sentencing Guidelines recommend sentences that are generally too high and place a grossly disproportionate emphasis on the concept of “loss” — the dollar value of the harm that a court finds a white-collar criminal to have caused.  This concept of loss is ill defined, and often artificial to the point of being arbitrary.  Moreover, the loss calculation fails to adequately approximate a defendant’s culpability, dwarfing traditionally relevant considerations such as the manner in which the defendant committed the crime and the defendant’s motive for doing so.

Fortunately, the Supreme Court has recently opened the door to systemic reform. In Kimbrough v. United States, the Supreme Court held that — at least in certain circumstances — a sentencing judge may deviate from a Guidelines recommendation based purely on policy disagreement with that guideline.  This Note argues that sentencing judges should adopt an aggressive interpretation of the Supreme Court’s Kimbrough opinion and exercise their newly rediscovered discretion to deemphasize the loss calculation and restore rationality to the sentencing of white-collar criminals.

February 3, 2010 at 06:47 PM | Permalink


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"deemphasize the loss calculation and restore rationality to the sentencing of white-collar criminals."

And why is it that when this note appears in the Duke Law Review my instincts are that this is a special plea by a student who has lost their trust fund. Oh, I know why.


Posted by: Daniel | Feb 3, 2010 10:34:38 PM

Most government prosecutions are of sharp business practices. These are enabled by the failures of contract law, a worthless, idiotic, toothless law subject. These false prosecutions force plea deals, and are revenue generators. Revenue generation without formal passage of taxes violates the procedural due process rights of the defendant. In most cases, the federal prosecutor has the moral and intellectual standing of Mafia extortionists of local stores. Morally, the law of necessity permits self-defense in self-help against these cult criminals. What should be done with a Mafia thug demanding protection money from a local business? Negotiate? No. The same has justification with the federal thug. These are not even human beings.

Sometimes, the government finds the rare real theft by fraud. Any amount of loss attributable to the defendant over an established value of life, such as $6 million, should result in a summary execution. That amount represents the murder of a lifetime of value of a constructive economic person. The theft eradicated the economic value of a life. The death penalty is justified.

Posted by: Supremacy Claus | Feb 4, 2010 12:50:59 AM

Warning. The Supremacy is not that bright. She is only 2 years ahead of the times, and her points will come to pass sooner than the lawyer cares to believe. You federal thugs and appellate judges start running. It is not too early. Federal marshals will be hunting you down with dogs and to shoot you on sight for your betrayal of the Constitution.

Example said only a short time ago. "All lawyers are mental cripples after 1L criminal cult indoctrination. They have to be to accept the dumbass, pure, worthless garbage, supernatural doctrines of the law from 1270 AD."

DOJ finally recognizes this devastating condition in an official announcement.


For those lawyers too retarded to find the relevant passage:

"Targeted disabilities are deafness, blindness, missing extremities, partial or complete paralysis, convulsive disorder, mental retardation, mental illness, severe distortion of limbs and/or spine. Applicants who meet the qualification requirements and are able to perform the essential functions of the position with or without reasonable accommodation are encouraged to identify targeted disabilities in response to the questions in the Avue application system seeking that information."

I encourage all you dumbass lawyers to apply. "Dumbass" is a lawyer term of art, meant only in the nicest way, here.

Posted by: Supremacy Claus | Feb 4, 2010 1:44:13 AM

I have to admire the cleverness of the DOJ lawyer. When the hunt starts, I am sure it will be very hard for Federal marshals to drop a traitor with twisted limbs, walking about, with a Goofy expression.

They forgot, "cross dressing, transgender, pedophilic, and gay, not to mention, victims of lawyer training in a Top Tier law school resulting in the nose going into the air, and the butt sticking out, and the inability to speak like a human being."

"Remember, you are trying to save our country," the added marshal training will emphasize.

Posted by: Supremacy Claus | Feb 4, 2010 2:00:18 AM

While this young fellow has clearly spent some time here, this is ultimately a rather light review of a complex area of the law. It starts with a fairly brusque legislative history that misses a lot of the nuance of the original genesis of the guidelines by relying too heavily on Breyer's general tutorial and other secondary sources. The commentary completely ignores the statutory imperative that the Commission must revise the guidelines from time to time - especially when confronted with new legislation and directives. A reading of the SRA reveals that. And while the imposition of some magical trope regarding "past practice of sentencing judges" that never really existed and has no basis in law, including the vaunted Kimbrough, is a rhetorical flourish we can forgive a thoughtful new legal scholar - people who have studied the guidelines longer would have to smirk at the premise that 2B1.1, or any guideline provision for that matter, must forever be based on what is little more than the mean national sentence for an entire group of various and sundry offenses.

When speaking of the lack of "real guidance" when calculating loss he fails to note that the sentencing courts have plenty of guidance with regard to calculating loss from the Circuit courts. As far as the USSC's role: compare the depth of the loss application notes in 2B1.1 to the application notes for any other guideline. And search of the USSC's website for "loss" and "2B1.1" reveals at least two papers on loss as well as several other resources under the aptly named "education and training" section. This argument, that it's just too much for courts to basically do what they want when calculating loss is especially humorous given that the overall premise of this article is that courts should do what they want.

In the following sections of his paper, we jump to broad statements like "the guidelines for white collar fraud are deeply flawed." His single poster boy for this effect is not compelling if you remove the sympathetic adjectives. Add a Texas accent and you've got Mr. Skilling.

He also suggests that things like relevant conduct, abuse of trust, and role aren't sufficiently considered by the guidelines. That's simply not the case and I don't think you'd find many people advocating for their expansion. His notion that loss has a "weak correlation" to culpability fails to appropriately consider that culpability includes measuring relative harm, not just between the two examples of 2B1.1 offenses he mentions (an "innocent" Skilling type, and a "bad" ponzi schemer), but ALL offenses. These simplistic examples in the face of thousands of actual cases that can easily be examined is really a fatal flaw.

Like I said, it's clear a lot of work went into this but these, frankly, sophomoric examples do his argument harm. Even his two examples, in real practice, would be treated as differently as a billion dollar fraud is from a comparable 2D1.1 offense. His innocent executive could easily be responsible for thousands of 401K's losing value and thousands of people canceling vacations and college for their kids. Their victimhood in this sense is no different than a Madoff victim. What is in the defendant's mind is not nearly as important as measuring the harm his conduct has caused. Here he draws a distinction that has no basis in accessing total harm caused by an offense. Basing culpability on the judge's perception of the defendant's motivation will make a loss calculation in a stock fraud look like figuring a dinner tip compared to an attempted Vulcan mind meld.

In his analysis of Kimbrough he strikes a hopeful tone, but he fails to boldly note that the subject of the Kimbrough case, the crack guidelines, were systematically disavowed by the USSC in umpteen reports to Congress which is a more than subtle difference between crack and loss when arguing the applicability of Kimbrough to the traditional role of the USSC. Further he glosses over the notion that every year Congress approves the actions of the USSC - except the one time they didn't - on crack. While Kimbrough rejected this adoption argument in the case of crack, it isn't entirely clear that the Court would do the same thing for loss or any other factor.

As he concludes he suggests that the USSC screwed up, and he does this by quoting Breyer's article again rather than the legislative history at the time of the first guidelines nor some the longer treatises out there that detail the rather lengthy explorations that the USSC went through. Suggestions that the USSC didn't study loss before implementing it initially, or changing it subsequently, are simply incorrect on the face of available materials that show multiple iterations and discussions, comment from a slew of experts and professionals, public hearings, ad hoc committees, and plenty of study by the USSC staff. Perception that the USSC was unprofessional in 1987 and along the way is more important than relating what actually happened.

Loss is a tricky subject and skimming the surface while suggesting radical change isn't very contemplative. The idea that the best practice is to simply base sentences on the mean not only ignores all of Booker, the SRA, and common sense, it's also a recipe for disparity since, as the author notes, most courts still comply with the guidelines.

Posted by: The Career Offender | Feb 4, 2010 10:06:02 PM

I really like your blog entries it is so refreshing to see analytical though around property rather than vested ramping.

Posted by: Flatshare | Feb 22, 2010 11:59:15 PM

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