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July 21, 2008

A telling consequence of severe white-collar sentencing guidelines and the trial penalty

This intriguing new article available from law.com, headlined "Federal Judge Refuses to Accept Guilty Plea in Health Care Fraud Case," spotlights one of the many pernicious effects of severe white-collar sentencing guidelines and the extreme trial penalty that white-collar offenders routinely face if they contest their guilt.  As the article explains, a white-collar defendant was prepared to plead guilty to an offense he many not have committed, surely because federal prosecutors told him he could face decades in prison if he went to trial and lost.  Here are highlights from the start of the article:

After months of negotiations, Chi Yang agreed to plead guilty in connection with fraudulent sales made by his Dublin, Calif.-based biotech company.  Even though he would admit to making a false statement, not fraud, Yang would still have to do prison time.  He would also owe hundreds of thousands of dollars in fines and restitution.

Then the deal reached Oakland, Calif., federal Judge Saundra Armstrong.  In what observers call a highly unusual move, Armstrong refused to accept Yang's plea. She raised questions last month about whether Yang actually committed all of the elements of the crime to which he agreed to plead. "It is not my practice to accept guilty pleas from people who are not guilty," Armstrong said, according to a transcript of the June 10 hearing.

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July 21, 2008 at 05:27 PM | Permalink


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Wait, don't you support using the death penalty purely as leverage to obtain guilty pleas from poor people? Didn't you even lament (also here) that a negative effect of Kennedy was that the threat of the death penalty could not be used in that manner and for that purpose in non-homicide rape cases? Why does that not strike you as "one of the many pernicious effects of severe [] sentencing and the extreme trial penalty that [poor] offenders routinely face if they contest their guilt."

Why do you believe wealthy people should have preferential treatment protecting them from coerced guilty pleas?

Posted by: DK | Jul 21, 2008 6:04:15 PM

DK: All capital defendants get an opportunity to argue to a jury that they do not deserve to be sentenced to death, and even without the death penalty in the mix they are usually facing a long (and justifiably long?) sentence even if they do plead guilty.

In other words, nobody has to plead guilty in order to avoid a death sentence because there is not mandatoryor even functional "trial penalty" in capital cases. In contrast, the trial penalty is SOOOOO huge in white-collar cases that a rational innocent person has to serious consider pleading guilty (consider the Fastow/Skilling difference in which Fastow gets 6 years and Skilling gets 24.3).

I do not believe "weathly people" should get preferential treatment. Rather, I think the entire criminal justice system should be informed by sober and sensible cost-benefit calculations, reasoned decision-making, democratic accountability and fair and transparent procedures.

Your comment suggests that only poor people face the death penalty. Though that may often functionally be the case, it is not a product of our formal legal rules but rather the product of our failure to conduct sensible cost-benefit calculations and to require fair and transparent procedures (especially as it related to prosecutorial charging discretion).

Finally, I do not support using the death penalty "purely as leverage to obtain guilty pleas from poor people." Rather, if/when guilt is sufficiently established and guilt concerns a crime that accountable democratic representatives have legislated as death-eligible, then it seems permissible (though maybe not noble) for society to accept as a benefit of a capital punishment scheme the possibility that guilt, terrible criminals will be willing to accept responsibility for their crimes in order to take death off the table.

In other words, if and when we provide a fair and transparent sentencing process for criminals to avoid severe trial penalities unconnected to guit on the underlying offense (which is the law in capital cases), I have no problem with guilty folks pleading guilty to get a sentencing discount. But when the sentencing process generally imposes a severe trial penalty unconnected to guit on the underlying offense (which is the law in white-collar cases), thenthe criminal justice system is not operating in an effective or efficient or fair manner.

Posted by: Doug B. | Jul 21, 2008 7:57:37 PM


"As the article explains, a white-collar defendant was prepared to plead guilty to an offense he many not have committed, surely because federal prosecutors told him he could face decades in prison if he went to trial and lost."

Defendants listen to what their lawyer tells them, not to what the opposing lawyer tells them. Indeed, opposing counsel cannot tell them ANYTHING, because a prosecutor may not communicate with a represented defendant except through the defendant's lawyer. There is no suggestion in the linked article that the prosecutor disobeyed that rule.

The way these things usually go, the defense lawyer, after talking with the AUSA, will tell the client something like: "The government has a pretty good case. If you go to trial you could lose on all counts. If you do, your jail exposure is quite large. But the government is facing some risks too. The evidence in this case is technical; the jury could just tune it out, and the prosecutor knows this. So I think I can get a deal where you plead to one count, get nine months in jail, and that's that as far as incarceration goes."

From what the article says, Mr. Yang bungled his part of the Rule 11 hearing, leaving the judge with understandable questions about whether he knew what he was doing.

So my reaction is: Fine. Let the trial begin. If the government fails to carry its burden to prove all elements BRD, Yang walks. Too bad. That's the way the cookie crumbles.

If, on the other hand, the government DOES prove each element BRD, then it's not the lawyers' fault that Yang will go to prison. The lawyers weren't doing the fraud.

Of course, in light of Booker-Kimbrough-Gall, Yang might not go to prison even IF he gets convicted on all counts. Mere prison "exposure" does not mean now what it did prior to the Big Three. If Mr. Gall, an Ecstasy dealer with a little more than three years' exposure under the Guidelines, could walk, Yang certainly could walk. And Yang will have something going for him that Gall didn't: the Ninth Circuit.

The only thing I'm sure about in this case is that the district judge will have to recuse herself. She has already said (without hearing one minute of testimony) that Yang is not guilty ("It is not my practice to accept guilty pleas from people who are not guilty"). She has prejudged the Rule 29 motion. She's out.

If she does not go voluntarily, then, if I were the government, I would seek her removal by the Circuit court. This is such an obvious case of pre-judgment that even the Ninth Circuit will have no choice.

Posted by: Bill Otis | Jul 22, 2008 9:01:40 AM

Mr. Otis, A judge has discretion (in fact, I think absolute discretion) not to accept a guilty plea. If the judge refuses to accept such a plea, no recusal is necessary. But, I am sure that you can show me one case from a federal court which holds that a refusal to accept a guilty plea on these grounds requires recusal. If you can't, then I think you are just making this up.

Also, Mr. Otis, you don’t seem to have actually read the transcript of this hearing. Instead, people seem to be relying on summaries provided to law.com by people with an axe to grind.

Posted by: S.cotus | Jul 22, 2008 12:05:24 PM


And I suppose you HAVE read the transcript?

Ha! Doesn't seem to dissuade you from commenting, though. (Nor should it).

Plus I'm sure you'll point out where I said that a judge's mere refusal to accept a guilty plea requires recusal.

As you know, I said no such thing; it's just the latest of your intentional distortions. What I actually said was that the judge's quite direct statement in the course of the refusing the plea THAT THE DEFENDANT WAS NOT GUILTY means that she has pre-judged the case. Pre-judgment of the case requires recusal, as you would know if you were actually the lawyer you brag about being.

Incidentally, your making this boast while declining to provide the citation to a single case you supposedly litigated sort of raises questions about whether it's true, eh?

So care to give us a citation?

Posted by: Bill Otis | Jul 22, 2008 6:47:01 PM

Actually, a judge SHOULD believe that a defendant is not guilty. Indeed, if she doesn't believe that defendant's allocution, that silly presumption of innocence does kick in.

So, it seems that you are arguing that a judge that presumes people to be innocent should recuse themselves.

I guess it is too bad that few judges will come out and say that they accept the government's assertions at face value as true.

Yes. I read the transcript. I am an American, after all.

Posted by: S.cotus | Jul 22, 2008 7:04:05 PM


1. You don't (because you can't) deny that you intentionally distorted my words when you claimed that I demanded recusal simply because the judge refused to accept the plea. Instead you just skip right on past that.

2. Continuing with your next distortion, any lawyer would know full well the difference between the judge's PRESUMING the defendant to be innocent, which no one thinks requires recusal (or anything); and STATING AS A FACT that the defendant is innocent, which is a pre-judgment of the case requiring recusal.

3. As I say, any lawyer would know all that. If you don't, the question arises again about your bragging that you are one.

Where's the citation to a single case you litigated?

Posted by: Bill Otis | Jul 22, 2008 10:17:37 PM

Your words speak for themselves. People can figure out what they think they mean. Since your appear on the same page as mine, nobody is relying on me to tell them what you mean. People can come to their own conclusions.

As a “fact” the defendant is “innocent” as a legal matter before the trial or a place. Perhaps there is some nuance to your position about the difference between “factual” and “legal” innocence, but those are completely different concepts.

Now, for the benefit of other people, let's try and unpack a plea colloquy. A judge is free to conclude (without, as I said, being second-guessed) that based on the assertions by the defendant, the defendant is remains “factually” innocent in that there is no factual basis for a plea. This is required by R. 11(b)(3). If the defendant and government can't convince the judge of that during such a hearing, then the judge MUST reject the plea. At this point the presumption of innocence leads to the conclusion that he is legally innocent. Just like Nixon.

Considering that I don't use the internet to attract clients by bragging about how liberal or conservative I am (and believe me, I can play either one on TV), I am not going to give you a citation to a single case that I litigated, or sat in the back row, or even the one where I was struck from the jury because I am a racist.

Posted by: S.cute.us | Jul 22, 2008 10:28:57 PM


1. That your distortions of my posts are easy to debunk does not make them any less distortions. There is no reason for doing it except to be annoying and deceitful. Please stop.

2. An explicit and announced pre-judgment of the ultimate issue in a case requires the judge to step aside. This is not even open to serious debate.

3. You have bragged here many times -- indeed more-or-less continuously -- that you are a lawyer, all the while looking down your nose at those who aren't. But you refuse to cite even one case you allegedly litigated. The refusal doesn't prove you're not a lawyer, but it certainly raises questions.

Posted by: Bill Otis | Jul 23, 2008 8:16:30 AM

I think this has more to do with the judge decided there was not a sufficient factual basis to accept the plea based on what the defendant would admit to in open court, rather than actually thinking the defenedant is innocent. "It is not my practice to accept guilty pleas from people who are not guilty," Armstrong said, according to a transcript of the June 10 hearing. That sounds so wonderfully noble, but Rule 11 clearly prohibits it. The defendant apparently admitted he made a false statement, but to whom? To the federal government? Material false statement related to an investigation? Saying "it's sunny outside" when it's actually cloudy and raining is not a crime.

Posted by: bruce | Jul 24, 2008 3:19:57 AM

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