Noting the Second Circuit's approval of big white-collar sentencing break

The National Law Journal noticed the Second Circuit's important (though unpublished) sentencing work earlier this week as reported in this article, headlined "In Upholding Impath Exec's Sentence, 2nd Circuit Bolsters Discretion of Trial Judges."  Here are snippets from an effective article:

In a decision important to high-dollar white-collar prosecutions, the 2nd U.S. Circuit Court of Appeals bolstered the broad discretion of trial judges to issue sentences far below, or far above, sentencing guidelines.  The court Tuesday upheld the 42-month prison sentence of former Impath Inc. chief operating officer Richard Adelson, despite an 85-year sentence recommended by the guidelines. Federal prosecutors had appealed seeking more time for Adelson.... 

Around the country, federal judges have grappled with ways to calculate reasonable sentences for corporate criminals under the guidelines that say the higher the financial losses the longer the sentence. In securities cases market gyrations in the wake of news of corporate malfeasance can cost investors millions of dollars and increase potential criminal sentences.

"The Supreme Court has spoken several times on this issue but the courts of appeal never really got it, until now," said Mark S. Arisohn, of Labaton Sucharow in New York and Adelson's attorney. "The 2nd Circuit now recognizes that district courts have discretion to deviate from the guidelines, way up or way down, so long as the district court judge justifies that decision," he said....

U.S. District Judge Jed S. Rakoff called that a virtual life sentence and "patently unreasonable," of the sort reserved for Mafia dons and drug kingpins.  In 2006, the same year Adelson was sentenced, the circuit upheld the 25-year sentence for ex-WorldCom Inc. chief Bernard J. Ebbers, based on an $11 billion fraud that sent WorldCom into bankruptcy.

"I don't know of any other cases out there where the difference between guidelines and actual sentence were so big," Arisohn said....  The ruling further bolsters the authority of federal judges to be guided by individual circumstances in white-collar cases involving large market losses, and set was is reasonable, rather than adhering strictly to a guidelines formula, according to Arisohn.

Some related posts:

• En banc Second Circuit hands down Cavera, the "local conditions" sentencing case
• Huge downward variance in white-collar case
• Second Circuit affirms (in unpublished opinion) greatly reduced white-collar sentence
• A (record-setting?) long white-collar sentence
• The loss-culpability connection (or disconnect) in white-collar sentencing
• Latest FSR issue focused on white-collar sentencing