we'll call now is united states versus  conspirator or confederate and they did so by turning the focus of foreseeability away from the way that that concept had been traditionally handled in the criminal law guilt you know law that aspect of the criminal law and they did it by limiting a defendant's accountability for the acts of another to the scope of the agreement that that the fendi had entered decided that to be one we for with the political yes guideline not one but one point three so in why when there is a specific guideline direct  commentary that appears to be correct we would the district court is wrong or in error for following that guideline you've just the right to another place an argument if i agree with your honor that that's where we need to go here there's three reasons i believe that i can offer as to why the district judge was wrong in that respect first of all as an overview the commentary as with the guidelines themselves is no longer binding it's just advisory so it doesn't have the force of law as of work that's true but the supreme court's the solutions since and has been pointed out to us talks about how  you know and he more but the the the comment the guidelines themselves tell us that the purpose of the background to a commentary is not to promulgated binding rules of application but to provide quote reasons underlying the promulgation of the guideline that's in the one b one point seven and i think if we do that if we look to the actual wording of this to be one point four and what the a drafters said it's clear that what they were dealing with and the reason they put that little portion of the of the commentary in there that's troublesome to us obviously us being the appellant is that they were dealing with and wanted to obviate certain proof problems concerning the difficulty of identifying victims and the loss or gain and they decided that that was the way to computing that and that's about what side of the issue here but that's a but that's a paul it's a policy judgment is a policy judgment how to approach your ear complaint is akin to the complaint that people had for years about  the crack powder cocaine this theory that it's not fair to view those as being so vastly different but the sentencing commission back in congress made its decision about that it was what it was for years i doesn't disagree with the policy and some district court judges do you know just break off and so the district a very wise and good judge articulate me and has taken issue with it so of some others i'm sure but the district court here didn't i didn't view it as as problematic why should we in services to say no you've got it take issue with that policy as well as well i think that that this court and i'll try to get back to were i was in my three points on the guideline but i think that this court's going to take a broader view and what what i think you are doing here if you adopt the government's construction and by the way a construction that the government never even thought of until judge hayden brought it up suicide on tape at the argument and there's a number of reasons that point to that well it's pretty clear i suggest that they didn't but doesn't matter if they were wrong in not thinking of it then the question is are they wrong now and they're certainly entitled to bring it up i can't say that but i think it does tell us something but what this chord i think should be looking at is whether  in light of that one line in there that one sentence and obviously one sentence could kill the as much as two but in light of that are we just relegating foreseeability to the trash can in this case given the importance of foreseeability as a foundation stone of criminal sentencing responsibility and that's what i believe this is  they the record is irrefutable really as to what we could prove and some aspects of it are undisputed at a proffer hearing if we had one and that is that these fellows the other two kept to themselves the fact that they were trading or that bauer was trading in these enormous amounts that resulted in thirty five thirty seven million dollars when her thought he was dealing with a very small scheme that he had structured exactly that way to what structured it that way to keep it small is it really fair to say that a fellow who enlists people to take inside information a sophisticated actor like your client who over the course a seventeen years feeds insider information to a security straight that and is circassians is where he doesn't look over mr bowers shoulders indeed he appears to be doing things to make sure there's no way people can connect him to mr bauer and he's not keeping track of it so there's no oversight at all is it really unforeseeable and is that mr bauer who can trade at ten thousand shares as easily as one share with the push of a button would not start taking more money th whatever it was that mr krueger wanted to take from sell well the point is your honor that that was exactly the issue that should have been addressed and that we were entitled to have addressed and that the bench rehearing and there's strong factors that support the polluters view of this even even if one even if she had had a hearing what was she going to do she was going to hear mr cooper say which she'd already heard him say we see through you that he this was a surprise to him she doesn't believe in him issues she indicated she found it incredible that that he could not have foreseen that power would be doing some profit theory on his own well but but let me if i particular instance and they would pass that along to bauer let's make it up one hundred shares of the us steel and that's what he thought they were doing now when the money came back after the sale got exactly the amount that were reflected eight can compliance with that agreement on the part of our he got back one third less expenses and taxes that bauer would have reaped on one hundred shares of us steel not knowing the bow was buying one hundred thousand shares now i felt to see why that would make his story that he had this agreement incredible rather it it highlights it and on top of it as we as the government belatedly informed kluger but in time for the sentencing the others had agreed admitted that they hid all this from kluger wife because they were afraid and at least that's what we postulate i think it's implicit in their letter that they were afraid it would stop the scene because it weaker wanted to keep it small understanded it was reduced then he was smart enough to know no i agree i don't think it reflected any moral compass side of his heart were hard pressed to defend anything that he did but the fact is that one be one point three and  you know looking so much at the guidelines let's look at that the the commission decided that criminal accountability for the acts of another should be limited to what that individual understood to be the scope of the agreement and this will hurt a little lotto said it was a very significant departure let's look at one there's two sections to one point three and the government has made an argument under a one way that your client is directly responsible but this isn't really an issue of even if even if we were to look at one b one point three and not to the specific guideline to be one point four that we should be looking at subsection a one a of one b one point three because that's section in the criminal behavior and the fact that ballard does something additional does or trades additionally doesn't doesn't mean that the information that was given by clear wasn't directly responsible and he's not directly liable for what's the problem with their reasoning on the well i think well firstly i don't think that is their reasoning but they did make a similar argument about eighty and abetting in any of that and the reason is that that's part of the same section with the one being one point three the section that we've been discussing about a conspirator a liability responsibility for the acts of another so how can we say that that section that subsection is rendered meaningless because of of the rest of one b one point three i mean i think it's an old adage  a tenet of construction that you've got to give meaning to parts of the statue and i think you're again you're just taking foreseeability which is a huge importance in this context and  tossing it away in and before i forget if i might i'd i have a feeling i'm interrupting your he touched jordan but now let me just say that one of the other things is that the government plates places a great stress on is the chords a ttention to this incest ynys where you focus on unless otherwise specified in the introduction in one of the one point three but i take that to mean that it must be specified in the other section whatever that other section is specified means specifically referenced not doesn't mean somehow by implication and there's nothing in to be  my numbers mixed up one point four that says anything about this is deemed to be an exception to the general rule of foreseeability in my mind and in our mind we agreed with you on this we would tell the but i have to disagree your honor that she might or might not change the sentence i think if you change if you accept what we think we can prove which of course judge hayden has now i think precluded herself from ruling on but if you accept that the amount is we said it was around five or six hundred four hundred something the government says well that was after taxes it should be around nine hundred so the total loss calculation is somewhere around two to three million that would be far far afield from getting up to the guideline range they govern here which is up around thirty million i don't see how the judge to do it she would be making a monstrous yes i think i understand your correctly judge the guideline range for that million is but i understand this and i don't claim it but the principle thing that really bothers at him for his conduct and we all do i mean what can be said about the propriety particularly we're all attorneys in this room and we you know pride the integrity of the profession there's little to be said to justify it but that doesn't mean that he do in your brief that if the case wriggle back she could be fair and well i i wish i didn't have to defend what i think is the in the fence hole but she basically said not basically she said that even if we had a hearing at which her put in all the proffer that mr zaid just put before the court at sentencing that it would make any difference in her ultimate determination that he was responsible for wrote about ours again right how have you done that how could she sit and decide by hearing that she's already decided the outcome of well how about because of at least two reasons one because it's under to be one point four as equal guideline range being in place what he thought is irrelevant because the guideline that particular guideline doesn't ask any question about her own will but then there wouldn't be a hearing right oh i agree with you i mean this is if there were if there were to be here why also would it not be appropriate for her to say in a fact i heard your proffer ick even if he got on the stand and said the things you say he would say even if ballarat got on the stand and said the things you say they would say i'm based on things that have already come before me it occurs to me that and the character that crying this is forseeable i could accept your proffer as being one hundred percent accurate and that and even with that one hundred percent accurate they get on the stand say the things you say they're going to say used you hand inside information to a trader and tell him hey we're going to steal money from the public oh i'm shocked that you took more shares i don't believe it what's wrong with a sensible judge saying i can accept your proffer and still say that i would find that incredible that's right see you as over the top biased and unable to fairly handle it absolutely absolutely i don't see how the judge could come to a conclusion about whether limited his self under one b one point three of course as we said to be governs we're out of luck but under one of the one point three in determining the scope of his agreement what else does it mean it's the same for a drug dealer they permitted drug dealers drug people involved to say why did know it was going to be twelve tons of marijuana i thought were just going to get you know one ounce or something like that they permitted that and there's no exception here for lawyers or other professionals so no the answer is i clearly and i have great respect for judge hayden i know her well and she she i think she just locked herself in or out if you will understood what was going warden he would not have taken and i don't like to use the term but in terms of what you say than problems i just quoted that he would have been saying something but even if that's not just for personal bias we're a judge commits themselves to a statement of facts or who a finding rather not a statement a finding of fact that that judge cannot go back and revisit  please the court caroline said last year on behalf of the united states starting with the reassignment i think it's clear from the record here that we're you know the defendant has said we're not talking about an extra judicial motive or that the judge had it's it has to do with her analysis of the record and the judge's determinations were made based on her fulsome analysis of the record in front of her and she decided that the record an extensive portions of mr clickers admissions during his plea colloquy the recordings of him on tape the properties made by his coconspirators all went to show that even if he had testified she understood the facts to be a certain way of course be one point four so maybe it's really not all that clear that it should apply is there a reason why the government didn't make that argument was wrong to say that guideline i think the government was focused on i think it seemed apparent to the government at sentencing that the reasonable foreseeability of this harm was so obvious that they chose to go sort of with one argument and i think stepping  in this case i think the guidelines just make clear in a complicated area how to handle what could be an unmanageable around and measurable amount and they cut off liability for instance for downstream tipping but you know i think it's been it's helpful to the courts to have something clear like this set out and you could say well the guidelines are explaining what reasonable foreseeability is in this case in some sense you know they're saying here if you participate in the act you are responsible for the gain from the information you provide it to people and that is in a sense a concept of reasonable for civility a liability and constrains the defendant's liability role of reasonable for c ability under one b one point three is the talk about acts in which you didn't directly participate when you're talking about a much broader conspiracy and traditionally under under criminal law even if you were a small part of that conspiracy you might be held responsible for the liability of all your coconspirators and the commission was concerned with very attenuated responsibility and here what's obvious is that this is not very attenuated there's not circumstances very attenuated actions on the part of his coconspirators they're trading on the information he gave them and you know so he's completely unlike someone in a drug conspiracy you agreed to participate in one trade and even if they know about the other traits has nothing to do with those other traits he was responsible for all the traits i'm curious about the the disparity argument that's been put before us really didn't get into that charter listing of various insider trading high profile cases that of occurred at around the time she was dealing with this and and very very largely the defendant courts that have been critical of the guidelines observed were not present in the cases where they very downward from the guidelines were all present here and indeed the difference between mr bauer and mr kluger as one of those factors mr hoover was responsible to seed an enhancement or an abuse of position of trust he occupied a unique position as an attorney and he did it for an extraordinary amount of time and over and of course of an extraordinary amount of traits so for his entire legal career from the time he was a summer it until seven years later through four firms putting down the scheme when he didn't have access picking it up again notwithstanding that there were two federal investigations into bowers trading that he knew about  and over the course of thirty trades taking a lot of pains to hide from law enforcement sets him apart from the other defendants and again you know mr cleaver would like this to turn on the amount of money he made but there are so many other scheme and what the judges were critical of in the second circuit in particular or in the southern district was that that this amount of money would really control the sentencing guidelines in when all these other factors sort of how  with the loss calculation driven by the tables and be saying no the his guideline is guideline ranges now dictated by that much higher gain would  eye maybe i would be wrong or it's counterfactual but i don't i don't see any i don't see any hesitancy on the part of the government to say thirty million dollars smack kluger with the whole should bang and i don't think you'd be arguing differently if it was ninety million dollars would you five hundred grand and yet the guideline calculation is driven by a number of north of thirty million well why isn't that a big enough difference in numbers to cause some concern and to say this whole thing is being driven by a chart that some people in a in an office in washington d c with green eyeshades on came up with and not with what's going on this case because that's the you know i'm not doing justice to the defense argument but that seems to be the tenor of it that that's and that certainly is giving concerned thoughtful judges around the country why are why should we  be worried about that well that may be what dictates the guidelines range going into step three of the sentencing and the judge was very aware of those arguments and and said i am not making a determination at the end of the day it is maybe where that i mind range puts him i'm aware that many judges have said this isn't great and i understand where they're coming from but here i am making mine third step to terminations based on all these other component of his actions all these other characteristics of his acts you know so i do disagree with the defendant when he says if this goes back the judge couldn't do anything else but sentence him to a lower sentence i actually think that was very clear in sa last muss you were an attorney who did this for seventeen years thirty times over you didn't care what the loss was you just care that you were going to distance yourself as much as possible from this and continue your scene as long as possible and you were extremely bold in doing it through the course of two federal investigations and when it was over you obstructed justice and told your coconspirators to destroy evidence in this case and all these factors went into the judge's final determination and so while the judge has the ability to consider the disparity in it instead of the disparity it ultimately had the discretion to decide this wasn't determinant have a sentence and that's why it came out where it did if there were remain and it shouldn't go to her i mean essentially what counsel is saying is that this is what the judge is going to do anyway and she made that clear i think so well any kind of like she was saying not with the tape would do but  you're not correct about that that the driver here be solde we gain that too now let me just let me just add verd for a moment to just two other things one is a course you know we have a much more discretionary argument dealing with the thirty five fifty three a application but i think it it doesn't go without noting that in that discussion the judge never even mentions how much money actually got out of this i mean ok the guidelines up here because of the chart made by those little green men or the men men and women with the green eyeshades rather but on the other hand doesn't the amount that he got that he profited in comparison to something like power have any meaning any significance even under a discretionary determination well she certainly knew it she didn't do it intentionally and she did talk about it i mean in the course of the sentencing it certainly came up right well it came up earlier in terms of the getting to the guideline range but when she got to the point where she was really discussing all of that seed send somebody give now that i've got this range she never mentioned it again along with other factors and i and i do understand that we're now moving into a much more discretionary area but i think it kind of reflects back and also i don't want to sit down without pointing the cord again forfeiture and the s e c disc origin both of which were down in the four hundred five hundred thousand dollar range the government had every right if they believed in this argument said that the cougar should forfeit three thirty million dollars i may be a little lottery next week it's not the first time that they've tried to impose forfeiture amounts on an individual who at the moment doesn't seem to have the assets this wouldn't be unique at all but they stuck with that lesser amount and i think they did it because they were focused on foreseeability when they came in there as i've already agreed they could've been wrong then maybe they're right now i hope not but that was where they were looking that's just even had robinson available to be a witness in a hearing that they thought was going to happen ok