Monday, October 16, 2006

Will Prosecutors Get Another Shot at Fastow's Sentence?

The six-year sentence given to former Enron CFO Andrew Fastow came as a surprise to many who thought that he would receive a ten-year term of imprisonment for his role in the fraud at the company.  Fastow even testified that he would be sent to prison for ten years.  According to a Houston Chronicle article (here), the government may appeal the sentence, although it's not clear whether that will be successful because prosecutors do not appear to have objected to the lower term at the sentencing hearing.  According to Fastow's plea agreement (here), "The parties agree that Defendant's sentence under the Sentencing Guidelines shall include 120 months in the custody of the Bureau of Prisons.  Defendant agrees that he will not move for a downward departure from the offense level or the guideline range calculated by the Court and that no grounds for a downward departure exist."  The agreement seems to restrict what Fastow's attorneys could argue to obtain a lower sentence, and so the basis for U.S. District Judge Kenneth Hoyt's decision to impose the lower sentence will be important.  At the hearing, prosecutors extolled the benefits of Fastow's cooperation, so it did not sound like the government had any objection to the lower sentence and may even have silently acquiesced in the six-year prison term.

The judge met with prosecutors and defense counsel in a closed session the day before the sentencing, however.  It is not known at this point what was said there, and the court denied a request by prosecutors for immediate access to a transcript of that hearing in order to decide whether to appeal the sentence.  Another Houston Chronicle story (here) quotes Judge Hoyt that "because the government was present, it is already in a position to know whether the government itself or the defense committed some act that violated a term of the plea agreement."  One hint at what was discussed at that hearing is a request by Fastow's counsel that medical information not be revealed, which may indicate that his attorneys provided information about his condition that may have been a basis for a lower sentence.

But even if Fastow's counsel sought a lower sentence in violation of the plea agreement, the government's failure to object to the lower sentence may put it in the position of establishing a plain error if it decides to appeal.  Under Federal Rule of Criminal Procedure 52(b), "A plain error that affects substantial rights may be considered even though it was not brought to the court's attention."  If prosecutors did not object to statements by Fastow's attorneys at the time they were made, then the government would have to show that the sentence works a significant injustice and calls into question the integrity of the judicial process.  Perhaps even worse, if prosecutors appear to have acceded to the lower sentence, then there would be a waiver of any claim that Fastow violated the plea agreement and the sentence cannot be challenged even for plain error.  Given the lack of any objection to the sentence during the hearing or even immediately afterwards, it certainly looks like prosecutors have been inconsistent in their position.  (ph)

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