Keller and Sutherlin were convicted of multiple counts of fraud, money laundering in connection with their operation of a viatical company called Kelco taking life insurance policies from terminally ill patients (particularly those suffering from HIV) who lied to the insurance company about true status of their health. Sutherlin was 17 when he joined Kelco and he was trained by Keller who persuaded him to join the company by lavishing him a six-digit pay and a title of "Vice-President".
The brief facts of the case are: Keller owned a viatical company called Kelco. He persuaded Sutherlin to join the company by dropping college. Together they purchased life insurance policies from terminally ill particularly HIV patients for less then face value to be sold to investors. Keller and Sutherlin encouraged such terminally ill patients to take more policies so that Kelco could have them to sell to investors. Kelco purchased policies from such patients who obtained policies by fraud i.e. they concealed true status of their health from the insurance company. In cases where high valued policies required blood samples, they asked the patients to arrange someone else to give the blood. In case of contestable policies (those which were within 2-year period of policy's effective date in which the insurance company could cancel the policy if it discovered that the policy was obtained by fraud)
Kelco concealed its purchase from the insurance companies by making them appear as if beneficiaries were using policies as collateral for loan & by setting up trusts. Both Keller and Sutherlin were tried and sentensed. Sutherlin was sentensed to 151 months imprisonment with 3 year supervised release upon termination of his imprisonment. Keller was sentensed for 168 months.
The Supreme Court of U.S. decided Booker which rendered the Sentencing Guidelines advisory rather then mandatory. Therefore, Sutherlin and Keller case was remanded for resentensing. During resentensing Sutherlin expressed remorse. Government acknowledged his contrition.
The District Court recognized the Sentencing Guidelines as advisory felt a necessity to impose a "sentence sufficient but not greater then necessary" to comply with purposes set forth in § 3553(a)(2). During resentencing the court applied each of § 3553(a)(2) factors. The court found that Sutherlin's youth was a significant factor in considering his sentence, Sutherlin worked under influence of Keller who exploited his youth, his lack of education and experience with a substantial salary and an elevated position which otherwise Sutherlin could never hope outside Kelco. The court acknowledged Sutherlin's post sentencing activities. On these factors, Sutherlin's sentence was revised to 36 months of incarceration.
While so deciding, the District Court also recognized that Sutherlin's culpability was undoubtful and overwhelming. He was a leader and an organizer of the conspiracy. This according to the District court was a ground for rejecting Sutherlin's disparity arguments.
Keller on other hand, exhibited complete lack of contrition, he blamed the government for being "overzealous prosecutor", maintained that law was unclear, he blamed his lawyers, and took no responsibility for his actions. Keller defendend himself by saying that (1). He was leading to more productive rather then unproductive life (2). He paid $600000 towards restitution. (3). He had a supportive family (4). He was well regarded by his community (5). Lawyer Johnson testified in his favor and credited him with the enhancement in his (Johnson's) quality of life. Considering the factors, the court sentenced keller for a concurrent imprisonment of 120 and 60 months.
Against the District Court's Judgment, Keller, Sutherlin and the State appealed. The question was reasonableness of the sentence. A sentence is either procedurally unreasonable or substantially unreasonable.
If a sentence substantively unreasonable if it is (1). arbitrary (2). based on impermissible factors (3). fails to consider pertinent factors (4). gives unreasonable weight to pertinent
factors.
However, a sentence is procedurally unreasonable if (1). the judge fails to consider the
applicable Guidelines range (2). neglects to consider other factors listed in the section or (3). simply selects what the judge considers appropriate sentence without such required consideration.
Post Brooker , the sentensing guidelines have been held advisory rather then mandatory. So the district court has a discretion to vary the Guidelines either above the or
below the Guidelines range. The Court should comply with the mandate that the sentence be sufficient but not greater then necessary.
The sentence within the guidelines range are presumed to be reasonable. However, those outside the guideline range are not presumed unreasonable. However, the judge has to explain the departure. More the departure, deeper the explanation & compelling justification.
Sutherlin aruged that Worley's statement that the district court weren't permitted to consider post sentencing factors was an obiter dicta. This argument was turned down. The court held that the Worley held that consideration of post-sentencing factors is incompatable with Brooker remand. Considering U.S. V/s. Lloyd, the court held that post-sentensing factors could be considered. However, Sutherlin's case was not one of that as affording unusual circumstances.
Applying the above rationale, the Court of appeals remanded the Sutherlin's conviction because while sentencing Sutherlin, the District Court had considered Post conviction factors which were not permitted in terms of Worley and were incompatable with Brooker. Other State Arguments in that the age could not be a factor for being disparately lineant. Referring Davis, the Court of appeals held the "age" factor as valid consideration.
On the other hand, the Keller's sentence was affirmed. The court concluded that the plea of procedural unreasonableness was waived in that none were explained as to what the issues meant that the district court ignored. Rather Court of appeals found that the district court had explicitly took account of Keller's productive life and supportive family. The District Court, according to Court of Appeals was not bound to explain each and every unsustainable and non-meritorious arguments of Keller. The disparity ground was turned down by saying that Keller engineered the fraud and his arguments had no merit. The Loss calculation arguments was not raised in initial appeal and considered as waived.
On the above grounds the Keller's sentence was upheld.
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