you here we're working on the night shift to hopefully gave you a little more time to prepare your arguments it certainly helped us out so we'll ask lots of questions please be aware that we have we will enforce the traffic light system it's a little loud and when the yellow light comes on you have two minutes when the red light comes on please conclude your argument unless you are answering a question from the court we have read your the court if i say sentencing guidelines were enacted to achieve two goals uniformity of sentences amongst defendants that are charged with similar criminal conduct across the united states and proportionality between the conduct of an individual defendant in the sentence that is ultimately imposed in this case the district court ignored those goals when it decided to implement as utilize the previous year's sentencing guideline manual in assessing the sentence or calculating the advisories guideline however if the court had sentenced him in october of two thousand and fifteen i don't think there would be error but because the court did not set some until march of two thousand and fifteen or twenty sixteen the twenty fifteen guideline would have been mandatory under thirty five fifty three one b one eleven of the united states sentencing guidelines and additionally the overall spirit as set forth in thirty seven forty two of title eighteen what's clear is the guidelines are meant to be the beginning god post it's when the court begins to look at what torsionally of the defendant's conduct means and so year to year the sentencing commission compiles data in order to update the men to the guidelines to better achieve those first two levels but this isn't even play there this is something relinquished well in order for the this court to find waiver the court would have to find three things first that this is a right of the defendant as opposed to an obligation of the court second that it can be waived by the attorney as opposed to the client himself and finally that the conduct or the language used by the attorney in this case was sufficient to relinquish that right i think that there are a number of issues presented here as the supreme court stated  hill the gravity of the right is how the court should determine what actions are necessary to weigh this is not simply an issue of countering this is overall the entire scope of a sentencing proceeding it begins at the very beginning by the probation officer utilizing the guidelines manual that is in effect on the day of the sentencing begins with an advisory guideline range in the court you know what we know what the procedures are understood  your point what my point was that this is the lodestar this is the beginning this is where the court has just alerted star but they change from every two or three years so there's only a limited profit from that it must have been obviously judge lynn was aware that the guidelines on the amount of loss were going to change apparently your client was aware of that or at least the trial counsel was aware of that and so when she asked that tr attorney himself have the ability to waive it or even if it's a right of the defendant as opposed to an obligation of the court because this is the foundation that the federal sentencing guidelines require is that they begin the certainly your time is going to be if then on this one i mean this would hurt your client in almost every defendant always that wanted more time before sentencing to cooperate if there were rules that you cannot continue past it so this would be quite far reaching to say defendants couldn't even request a continu but anyway you can keep going on and i got some other arguments that interested me more yes well ultimately the way i wanted to phrase that and i'll wrap it up very shortly  as far as this goes it's not necessarily that the continuous should or should not have granted it just that it should not have been a bargain based upon what was required of the court the other issues presented in this case relate to some other guidelines issues as well in this case the question arises of whether or not they're sophisticated means this case on paper seems to be a little more complex than it really was it was a defendant who had set up a corporation so listen vestments in the corporation and ultimate it's clear that there has to be something a little bit more than merely setting up in sub a foreign corporation he didn't hide the headquarters of his corporation but rather rather this corporation was set up in order to achieve a goal of obtaining these investments only kept lying to these people didn't fabricate earning statements or falsify earning statements i believe what he did was he was creating updates that he was sending out over emails and he had hired some consulting that had given him the advice that when you have these investors are not hanging back show them that maybe there's not a direct return on their investment but rather that there is some return occurring you know we have x y and z in the pipeline and that that i don't think falls within what would be traditionally sophisticated to use part of the issue with that was there were a couple of corporations that he did star throughout the course of the case they're analyzing but i do believe those six were lated to win plus nevertheless the corporation with the means by which it was  you're back to the bank account issue i believe that was the issue in valdez was that the individual i can say is and a fellow who was able to persuade the jewelry sales woman from home he was buying a seventy six thousand dollar success had led to monies back to the victims or was that not in the record i believe that was part of the intended loss objection that was made so when they were calculating a loss in this case they were looking at both they were actually looking at the actual loss incurred by the by the investors but that was not the proper analysis because money had been paid back in that there were legitimate business expenses actual loss relates more to the subject intent of the defendant where as here it appears the subject of intent was to make as much money as possible and pay back what he could but the subjective intent was and that's only because three point three nine million dollars in loss really the intended los but i think the commentary or the comma no contained in to be one point one is really the critical analysis as well as looking at the subjective intent in looking at it ultimately what it was intended here i think is that the  registered as a broker there was and has been because there is some concern that or he was found that he was engaged in the sale of securities which would require him to register as a programmer title fifteen of the u s code what is clear here is he was soliciting investment he was i thought that without argument there was sort has the problem the first one did right it does share a similar issue i don't think the language used by the attorney was so clear i think certainly plain error is something this court should consider for that the language used by the attorney in that case i think is the issue there where as he is a bit more quick to call in the same and i think his statements to the effect of i understand the law here you're wrong here and i'm not or two hundred ten months i believe it would be a level thirty five category one and have to double check that up there has to be an intent to defraud or harm and there has to be an artificer scheme to defraud at the time that the investment was made in this case which i think is problematic moreover i think as far as he put all that evidence was given to the jury at least in the shadows of the evidence that was presented was that there was some polish mis involved and he was optimistic and i think that the sentencing judge did consider that and that he had any of a prior fraud conviction  further i think that there is an issue with the statements that were presented as part of the government's exhibit relating to a deposition that was taken that that was the crux of the motion to suppress in this case and in the motions suppress there is this or transcript of the deposition there is this attempt by the defendant to make clear that he is uncomfortable answering this he's trying to assert some type of privilege and i think the exact language he uses is attorney client privilege he's not at that testimony was never introduced it was never introduced however it was partially it did prevent him from ultimately testifying in the case because that evidence would have been able to come out and would have prevented him from taking the stand and  may please the court brian portugal for the united states would like to speak first about the evidence you're challenging the challenge of the sufficiency of the evidence to support count four of the indictment that was the bankruptcy false statement involving the relationship between the investors and the wind plus entities the appellant challenges the sufficiency with respect to the use of the word substantial with respect to the representation of there were twenty plus note holders and with respect to the statement that those note holders were limited to the time periods of two thousand and four two thousand and five further first with respect to a substantial number of note holders being repaid if you review governments exhibit one ninety eight i think you will see that that number that were paid back during that period is at most about nine and that also depends upon whether you consider that promissory notes were merged with successive investments for example one of the investors mr kershaw his subsequent promise or no where he was investing more money makes clear on its face that it subsumes the prior promissory note so with respect to some of these investors if you consider that they're being subsumed well then they're not even some of those nine aren't paid back and what if if the answer is substantial or approximate why doesn't the law the full statement more require you to follow up and say when you say twenty plus do you mean ninety seven or do you mean twenty to thirty isn't it how do you have a literally false answer when you add those qualifiers that may be seen as a basis because part of the charge your honor is to for the jury to assess an intent by that statement to deceive and the jury was properly instructed us to count four and correctly found that when mr spalding made the statement that a substantial number had been repaid he intended for that to be false and to substandard to severely under represent the number who had been repaid so bronston is always a jury question no it's not always a jury question on a judge but bronston only comes into play when the answer is not responsive so here the bank suit trustee asked mr spalding can you describe the relationship ok his answer was responsive it was probative of the relationship between the note holders in the entities there and all court agreed that that that that's the critical element roxanne is that has to have been not responsive will certainly this court has your honor through my me that  refer you to government exhibit and that's number two twenty four a just a a review of that exhibit and i came up with at least sixty note holders or sixty investors limited to the time period over four zero five there were many many more and and certainly the time period of the investments was not limited to over four hundred five so that portion of the answer is also falls for the same reason as i discussed with you judge a concern about the the bronstein being an opposite it was likewise an opposite as to the jury instructions there was no requirement the jury was correctly instructed by chief judge land that something that is true cannot be fraud i'm happy to answer the court's questions on any of the other issues i did two quick ones and just by the two areas of law that have always been a little confusing to me seem implicated a little bit here one is summary chart and the other is offsets so on the summ chart was the chart did the church i couldn't find it and i need to look harder but the actual chart that you presented was there a column that said these monies are business and these are personal that isn't right but if that column exists that's not really a summary of pollution it's writings that's not a ten o six summary chart that would be a six eleven summary of the witnesses statements right it is but it's necessary with respect to referring to the individual account entries and in other words it's sort of i guess i'm saying you you offer a charge to a jury and i take it they took it back as evidence it wasn't just a demonstrative chart that's correct the only basis offered for that if it were  thousand and six which comes in as evidence would just be summary of voluminous writings but if what you've done is mixed to charge together one is voluminous writings the data but then also a column that reflects these the witnesses did perceive err i submit for the reasons expressed in the briefs that it's it's more than harmless given the that the underlying testimony of the forensic accountant and his charts are very powerful in use and i've just never quite understood the line between a thousand and six that evidence in a six eleven demonstrative it's reiterating what a witness said then makes sense to put them together i don't see this teased out ok well then just quickly the other thing on offsets if i read your brief clerically you implied that if services had been rendered and then you had printed sees none here and offset might be a do right you know so what's the limiting principle let's say he has a business that eventually ends up defrauding a lot of people but it happens to succeed once that morgan branch of venture is the entire business a loss or do you have to offset it for whatever actual business related to the successful endeavor he had in alternate energy i think the demarkation your honor is between a legitimate business and perhaps a scenario where there is an embezzlement and a purely fraudulent business from the start from the start which is what wind plus was from the beginning so we got lucky on the morgan bridge last question in essence he really did your honor and the if you read that the testimony of tom boney and if you read the defendant's own witnesses who testified about this but doma and the looking into buying morgan ranch mr spalding really succeeded in spite of himself and i think it was a fair and inference for the jury that with ray booth and tom carbone a actually being there and being legitimate consultants that mr sperling had a powerful incentive to get something out of this and at least make it appear that it to expenses you know is i think is i understand is only point was that he should only be at a loss amount should only be what he actually diverted and not at my point because and for sentencing purposes it would have been up to him that was it for me only thing well i have one question about the fact you know changing the guidelines is a bargaining chip there's no question but the guidelines the last few years  a trend downward in the severity and that would create an incentive for a defendant to try to go down but on the other hand why why is that a legitimate thing for the court to bring up as opposed to the government what i'm saying i'm not sure i do well the court as i understand it he asked for a continuance and the court said to him only if you will agree that we'll use these guidelines not the incoming guideline and it now if the court or been running late on her sentences she could have said is it ok for us to use you know the later i mean don't courts do that sometimes or not they did they do and i think having read the trial record and knowing that chief judge  one sat through the entire trial i think and her experience with mr spalding especially the grounds for the motion to continue made her suspect that he might be trying to attain a continuance just for that purpose to guidelines i don't think so so that's why i'm just sort obviously the sentencing commission has kind of create these opportunities for gamesmanship if they went up it would be the opposite i just think it's interesting because you know you can talk we can talk all we want to about the goal of uniform sentencing but if they're going to change the goalposts every two years is nothing of all about it at the time the convenient for granted i had the  just briefly yours with regard to the guidelines if i do think that there is one point that i did want to get out that i overlooked and do want to make clear now what is clear is that the discourse actions in this case materially change these this court's ability to review the sensibly case it goes from being a presumption of unreasonable or at least not having the presumption of reasonableness to the sentence in this case now has the presumption of reasonableness because it is a below the guideline sentence and if it had been the reverse of the court had started with the twenty fifteen guidelines and ultimately switched those guidelines and considered the twenty four thousand guidelines as well there be an argument that this doesn't  three and that the court gave significant way to an improper or irrelevant sentencing factor which would have been the previous year's guidelines i think that that's certainly problematic and my recollection of the record is the u s attorney's office did not take a strong   it isn't i think it was up partially because the court did consider the guidelines as they applied again so that was one of the statements the court did make i think the government has the exact quote in their brief on the point six subsection b in their brief ok and so that is part of it nevertheless it did wind up to be above the guideline sentencing range that would have been applied had the twenty fifteen guidelines been utilized by about twelve months and because the switch in the presumption made it difficult to appeal not only that but because