11-3591-cr(L) United States v. Goffer 1 UNITED STATES COURT OF APPEALS 2 FOR THE SECOND CIRCUIT 3 4 5 August Term, 2012 6 7 (Argued: March 11, 2013 Decided: July 1, 2013 8 Errata Filed: July 25, 2013) 9 10 Docket No. 11-3591-cr(L) 11 12 13 UNITED STATES OF AMERICA, 14 15 Appellee , 16 17 -v.- 18 19 ZVI GOFFER, CRAIG DRIMAL, MICHAEL KIMELMAN, 20 21 Defendants-Appellants, 22 23 JASON GOLDFARB, ARTHUR CUTILLO, EMANUEL GOFFER, DAVID PLATE, 24 25 Defendants. * 26 27 28 Before: 29 WALKER , SACK , AND WESLEY , Circuit Judges. 30 31 32 33 34 35 Defendants Zvi Goffer, Michael Kimelman, and Craig Drimal 36 appeal from convictions of conspiracy to commit securities 37 fraud in violation of 18 U.S.C. § 371 and securities fraud 38 in violation of 15 U.S.C. §§ 78j(b) and 78ff and sentences 39

*The Clerk of the Court is directed to amend the caption in the case to conform with the above. 1entered in the Southern District of New York (Richard J. 1 Sullivan, Judge ). Defendants allege that (1) wiretap 2 evidence is inadmissible in prosecutions of securities 3 fraud; (2) the jury lacked sufficient evidence to prove 4 Defendants’ knowledge of the insider source; (3) the jury 5 instructions on conscious avoidance were improper after the 6 Supreme Court’s decision in Global-Tech Appliances, Inc. v. 7 SEB S.A. , -- U.S. --, 131 S.Ct. 2060 (2011); (4) the 8 district court improperly excluded a rejected plea bargain; 9 and (5) the sentences were higher than other white-collar 10 defendants receive for comparable thefts. We hold that (1) 11 wiretap evidence is admissible where the wiretap was 12 lawfully obtained, and wire fraud remains a predicate 13 offense to obtain a wiretap; (2) there was sufficient 14 evidence from which a jury could reasonably infer 15 Defendants’ mens rea ; (3) conscious avoidance law was not 16 altered by Global-Tech ; (4) the district court properly 17 excluded evidence of a rejected plea bargain; and (5) 18 Defendants’ sentences were reasonable in light of the 19 magnitude of their theft and the 18 U.S.C. § 3553(a) 20 factors. The judgment of the district court is accordingly 21 AFFIRMED. 22 23 24 25 26 ALEXANDER MARTIN DUDELSON, Law Office of Alexander 27 M. Dudelson, Brooklyn, NY, for Appellant Zvi 28 Goffer

. 29 30 MICHAEL S. SOMMER (Morris J. Fodeman, Scott D. 31 Tenley, on the brief ), Wilson Sonsini Goodrich 32 & Rosati, P.C., New York, NY, for Appellant 33 Michael Kimelman

. 34 35 ARLENE VILLAMIA-DRIMAL, Weston, CT, for Appellant 36 Craig Drimal

. 37 38 ANDREW L. FISH, Assistant United States Attorney 39 (Richard C. Tarlowe, Assistant United States 40 Attorney, on the brief ), for Preet Bharara, 41 United States Attorney for the Southern 42 District of New York, New York, NY, for 43 Appellee United States of America

. 44 45 46 2WESLEY, Circuit Judge: 1 Defendants Zvi Goffer, Michael Kimelman, and Craig 2 Drimal were convicted in the United States District Court 3 for the Southern District of New York (Richard J. Sullivan, 4 Judge ) of conspiracy to commit securities fraud in violation 5 of 18 U.S.C. § 371 and securities fraud in violation of 15 6 U.S.C. §§ 78j(b) and 78ff, 17 C.F.R. §§ 240.10b-5 and 7 240.10b-5-2, and 18 U.S.C. § 2. 1Goffer and Kimelman were 8 convicted after a 13-day jury trial; Drimal pled guilty. 9 Goffer was convicted of two counts of conspiracy to commit 10 securities fraud and twelve counts of securities fraud; 11 Kimelman was convicted of conspiracy to commit securities 12 fraud and two counts of securities fraud; and Drimal pled 13 guilty to conspiracy to commit securities fraud and five 14 counts of securities fraud. Drimal and Goffer appeal their 15 sentences and Kimelman and Drimal challenge their 16 convictions based on evidentiary rulings, jury instructions, 17 and sufficiency of the evidence. 2 18

1Jason Goldfarb also filed a notice of appeal but no brief; his appeal was dismissed by an order of this court dated March 16, 2012.

2We address Defendants’ additional arguments in a related order. United States v. Goffer, 2013 WL 3285137(2d Cir. 2013) (summary order). 3**Background** 1 Goffer, Kimelman, and Drimal, along with non-party 2 defendants, conducted a double-blind, high-volume insider 3 trading network that led the participants to acquire over 4 $10 million in profits. Goffer, who worked as a proprietary 5 trader3at the Schottenfeld Group, LLC (“Schottenfeld”), 6 spearheaded the conspiracy. 7 In 2007, Drimal traded from the offices of the Galleon 8 Group (“Galleon”), a firm led by Raj Rajaratnam. Kimelman, 9 previously an attorney at a New York law firm, traded for 10 Quad Capital (“Quad”), a proprietary trading firm. In late 11 2007, Kimelman, Goffer, and Goffer’s brother Emanuel 12 established a new trading firm, Incremental Capital 13 (“Incremental”), though they retained their other positions. 14 In early 2008, Kimelman left Quad to trade with Emanuel, 15 and Goffer began trading at Galleon. Kimelman and Goffer 16 spoke often and shared information that led them to trade in 17 the same stocks. In 2007 and 2008, Kimelman and Goffer 18 traded 151 stocks within five days of each other, including 19 88 stocks that they both traded on the same day. 20

3Proprietary traders use the firm’s capital to make trades and retain half of the profits that they earn. 4**I. The Conspiracy**  1 In the summer of 2007, Arthur Cutillo and Brian 2 Santarlas, attorneys at Ropes & Gray LLP, met with Jason 3 Goldfarb, a workers’ compensation attorney who had attended 4 law school with Cutillo. Goldfarb indicated to the Ropes & 5 Gray attorneys that he had a friend who traded stocks and 6 would pay for information about corporate acquisitions. The 7 Government showed at trial that Goffer was this friend. 8 What followed was a series of “tips” in which Cutillo and/or 9 Santarlas would obtain material non-public information and 10 pass it to Goldfarb, who, in turn, would pass it to Goffer. 11 Goffer distributed these “tips,” which frequently related to 12 impending takeovers, to friends and partners. Based on 13 these tips, Goffer and his co-conspirators would acquire 14 positions in the targeted companies and profit from the 15 takeover’s effect on the share price. 16 Goffer’s network used prepaid cellular telephones to 17 avoid detection; these phones – used by the attorneys and 18 the traders – were destroyed after each successful tip. 19 See, e.g., Tr. 429-31, 436-37; Gov’t Ex. 114, 127. 20 Throughout the relevant time period, Goffer spoke with co21 conspirators, especially Kimelman, guardedly when on the 22

5phone. For instance, he described the P.F. Chang’s tip as “a 1 good thing” but “nothing I’m going to talk about on the 2 telephone.” Gov’t Ex. 145. Goffer often asked Kimelman to 3 meet in person or “in the street” when conveying sensitive 4 information. They also discussed countermeasures and ways 5 to avoid detection, suspecting that high-volume trades in 6 little-traded companies immediately prior to their 7 acquisition could raise regulatory eyebrows. Goffer relied 8 on Kimelman to provide him with insights into the meaning of 9 legal documents associated with the acquisitions, including 10 revised merger agreements, settlement agreements, signature 11 pages, and limited guarantees, inter alia

. 12

**II. The 3Com Tip**  13 The first tip presented at trial related to Bain 14 Capital’s bid to acquire 3Com. When Cutillo and Santarlas 15 learned about the progress of the deal – for example, by 16 finding documents entitled “closing agenda” or “signature 17 papers” on Ropes & Gray’s document management system or on a 18 communal printer - they reported this progress to Goldfarb, 19 who passed it on to Goffer. Goffer shared information 20 relating to the takeover bid with some of his co21 conspirators. Goffer frequently convened a group of co22

6conspirator traders (typically including Emanuel, Kimelman, 1 and David Plate, another Schottenfeld trader) at a bar where 2 the group would discuss the progress of the takeover bid and 3 any new information that Goffer had received regarding the 4 plans. 5 On August 7, 2007, Goffer, Drimal, Emanuel, and Plate 6 began acquiring 3Com stock based on the material nonpublic 7 information that Goffer received from Goldfarb. Gov’t Ex. 8 10. That evening, Goffer had a 25-minute phone conversation 9 with Kimelman. 4The next day, Kimelman purchased 94,200 10 shares of 3Com stock. That week, forbidden from purchasing 11 more 3Com stock by Quad’s risk management team, Kimelman 12 sent an otherwise wordless email to Goffer into which he had 13 pasted an instant message conversation with Quad’s risk 14 management expert. 15 Goffer also provided details about the acquisition and 16 the sources of his information to Drimal; Drimal passed both 17 on to David Slaine, a cooperating witness. Drimal explained 18 that the information came from an attorney from “Ropeson” 19 who risked “his whole . . . career and maybe going to jail” 20 by sharing these tips. Gov’t Ex. 206, 208. 21

4This conversation predated, and therefore was not recorded by, the wiretaps employed by Government investigators in this case. 7On September 27, 2007, Goffer told Plate and other co1 conspirators that the acquisition of 3Com would happen the 2 next day. Goffer had learned that the signature papers were 3 prepared and he confirmed with Kimelman, who verified, based 4 on his background as an attorney, that signature papers 5 “were what they sounded like; they were something that took 6 place at the end of a deal.” Tr. 831-32, 1067. Kimelman 7 was either present or was consulted over the phone. Bain 8 announced its acquisition of 3Com the next day; the co9 conspirators all profited. 5Goffer told Plate that he 10 needed to pay his source, and identified those who were 11 contributing (including Drimal); the co-conspirators paid 12 Santarlas, Cutillo, and Goldfarb $25,000 each. 13 **III. Other Tips** 14 In November 2007, Santarlas overheard other Ropes & 15 Gray associates discussing a client’s upcoming acquisition 16 of Axcan. Santarlas, who did not work on mergers and 17 acquisitions, accessed at least four documents on the Ropes 18 & Gray document management system relating to the 19 acquisition; he and Cutillo shared the tip with Goldfarb. 20

5Goffer earned $378,608; Kimelman earned $243,716 in his Quad account and $16,687 in another account; and Drimal earned $4,535,000. Gov’t Ex. 10. 8Goldfarb passed the attorneys’ information to Goffer, who 1 disseminated it (at a minimum) to Drimal and Slaine. Drimal 2 shared the information with Michael Cardillo, a Galleon 3 trader, though he again attributed the tip to “Ropeson” 4 attorneys. Tr. 1106. Drimal and Plate purchased Axcan 5 stock and benefitted from the Axcan acquisition announced on 6 November 29, 2007; Drimal gained $1,984,867. Goffer did not 7 trade Axcan because it was a small, rarely-traded stock and 8 he did not want to attract regulatory attention. Tr. 657- 9 58 **.** 10 In February 2008, Santarlas learned about a possible 11 takeover of P.F. Chang’s China Bistro, Inc. (“P.F. Chang’s”) 12 from a colleague; he conveyed this information to Goldfarb, 13 who shared it with Goffer. Tr. 131-34, Gov’t Ex. 2. A few 14 days later Goffer called Kimelman to seek his advice, but 15 noted that it was “nothing I’m going to talk about on the 16 telephone.” Gov’t Ex. 145. Kimelman agreed to come into 17 Manhattan to “figure out our plan of attack.” Id. Goffer, 18 Emanuel, and Kimelman decided to purchase P.F. Chang’s stock 19 as part of an acquisition of a broad restaurant portfolio to 20 disguise their use of the inside information. Tr. 849-50. 21 Goffer instructed the group that “everything’s got to be 22

9printed out” to help them “go about . . . justifying a 1 trade.” Gov’t Ex. 149. No P.F. Chang’s acquisition was 2 announced in 2008. 3 In March 2008, Cutillo and Santarlas observed that deal 4 documents for Bain Capital’s acquisition of Clear Channel 5 Communications, Inc. (“Clear Channel”) were laid out in a 6 “closing room” at the law firm, apparently ready for 7 execution, and reported that closing was imminent. 8 Unbeknownst to these tippers, neither of whom worked on the 9 deal, the Clear Channel acquisition was staged so that the 10 lenders could be sued for specific performance. When the 11 deal did not close as anticipated, Goffer, Kimelman, and 12 Drimal all suffered losses on their Clear Channel 13 investments. 14 In May, there was more Clear Channel activity at the 15 Ropes & Gray offices. Cutillo passed the information to 16 Goldfarb, who told Goffer. Tr. 494-95, Gov’t Ex. 198. 17 Goffer summoned Kimelman for an “urgent meeting;” 18 immediately afterwards, he called another trader and told 19 him to purchase Clear Channel call options for “everybody.” 20 Gov’t Ex. 199, 201. Over the next two business days, Clear 21 Channel publicly announced that it was in settlement talks 22

10with the lenders and that an amended merger agreement had 1 been reached. The market reacted favorably to this news and 2 Goffer earned over $1 million in profits in his Galleon 3 account trading on this tip. 4 Schottenfeld trader Gautham Shankar provided several 5 tips to Goffer, including acquisitions of Kronos, Inc. and 6 Hilton Hotels Corp. (“Hilton”). Tr. 650-51. Goffer, 7 Kimelman, Drimal, and Emanuel benefitted from trading on 8 this inside information. Profits from these illegal trades 9 were included in calculating the loss amount for sentencing 10 purposes, but the trades were not charged at trial. 11

**IV. Recruitment of David Slaine**  12 In the fall of 2007, Goffer and Kimelman recruited 13 David Slaine to join Incremental Capital. The co14 conspirators hoped that Slaine, who unbeknownst to them was 15 working as a cooperating witness after his own arrest for 16 insider trading, would provide them with the financial 17 backing to get their insider trading-fueled business off the 18 ground. Kimelman urged Goffer to tell Slaine that he would 19 “get great information” by investing with Incremental. 20 Gov’t Ex. 114A. Goffer mentioned that he had received tips 21 about certain acquisitions before they happened, including 22

113Com, Axcan, and Hilton. Gov’t Ex. 212. Goffer jokingly 1 told Slaine that the information came from a construction 2 worker, but when pushed he elaborated “you [are] probably 3 better off not knowing where they were coming from...[Y]ou 4 don’t want to know where it’s coming from obviously.” Gov’t 5 Ex. 222. Kimelman chimed in, asserting that the source was 6 that “[g]uy fixing that pothole down there.” Id. 7

**V. Trial and Sentencing**  8 The Government’s evidence at trial included testimony 9 from Slaine, Santarlas, Plate, Cardillo, and a Ropes & Gray 10 partner. It also included recordings of Slaine’s 11 conversations with Goffer, Kimelman, Drimal, and Emanuel; 12 wiretap recordings of Goffer’s conversations with Kimelman, 13 Drimal, Emanuel, and others; instant messages and e-mails 14 sent between the co-conspirators; telephone records; and 15 trading records. 16 Defendants were convicted on all counts. The district 17 court sentenced Drimal (who pled guilty) to 66 months’ 18 imprisonment, Goffer to 120 months’ imprisonment, and 19 Kimelman to 30 months’ imprisonment. The district court 20 also entered forfeiture orders of $11 million, $10,022,931, 21 and $289,079 against Drimal, Goffer, and Kimelman, 22 respectively. 23

12**Discussion** 1 Defendants challenge (1) the admission of wiretap 2 evidence in support of their securities-fraud convictions; 3 (2) the sufficiency of the evidence to support Kimelman’s 4 conviction on the substantive counts of insider trading; (3) 5 the district court’s jury instructions on conscious 6 avoidance; 6(4) the district court’s exclusion of evidence 7 that Kimelman rejected a plea bargain; and (5) the sentences 8 they were issued. Other arguments raised by Defendants are 9 addressed in a related summary order. Goffer, 2013 WL --. 10

**I. Lawfully-Obtained Wiretap Evidence Is Admissible in a**  11 **Securities Fraud Prosecution** 12 13 Defendants contend that the district court erred in 14 permitting the Government to introduce evidence obtained 15 through wiretaps because securities fraud is not a predicate 16 offense under Title III of the Omnibus Crime Control and 17 Safe Streets Act of 1968, 18 U.S.C. § 2510 et seq. (“Title 18 III”), and because the evidence was not intercepted 19 incidentally to an otherwise lawful wiretap. See 18 U.S.C. 20 §§ 2516(1), 2517(5). Concurring with the analysis of a 21

6“The Supreme Court appears to now prefer the appellation ‘willful blindness.’” United States v. Ferguson , 676 F.3d 260, 278 n.16 (2d Cir. 2011). However, “[b]ecause the parties used the term ‘conscious avoidance’ below, we continue to use that term for purposes of this case.” United States v. Coplan , 703 F.3d 46, 89 n.39 (2d Cir. 2012).13recent and related case in the Southern District of New 1 York, we hold that the evidence was lawfully obtained and 2 therefore properly admitted. See United States v. 3 Rajaratnam , No. 09-cr-1184(RJH), 2010 WL 4867402, at *1-6 4 (S.D.N.Y. Nov. 24, 2010), aff’d, No. 11-4416-cr, -- F.3d –-, 5 2013 WL 3155848 (2d Cir. June 24, 2013). 6 Defendants assert two flaws with the wiretap evidence 7 that the Government adduced at trial. 7First, they allege 8 that the wiretap evidence should be excluded because 9 securities fraud is not a predicate offense under Title III. 10 Second, they allege that the intercepts are not admissible 11 in a securities fraud prosecution unless interception of 12 information relating to securities fraud is inadvertent. 13 Neither argument is persuasive. 14 Title III contains an exclusionary rule prohibiting the 15 use at trial of “unlawfully intercepted” communications. 18 16

7Drimal also contends that the wiretap intercepts were predicated on “dishonest manipulation by the government” and (we presume) that they should therefore have been excluded. “A defendant who pleads guilty unconditionally . . . waives all challenges to prosecution except those going to the court’s jurisdiction.” United States v. Lasaga , 328 F.3d 61, 63 (2d Cir. 2003). Drimal, who entered an unconditional guilty plea, waived this meritless argument. Moreover, the wiretap applications specify the nature of Goffer’s scheme and explicitly note that securities fraud (a) will be uncovered and (b) is not a predicate offense for Title III. 14U.S.C. §§ 2518(10)(a)(i), 2515. To benefit from the 1 exclusionary rule, Defendants have to establish that the 2 wiretaps were illegal. 3 Section 2517(5) of Title III governs the use of 4 evidence obtained on a wiretap “relating to offenses other 5 than those specified in the order of authorization or 6 approval.” 18 U.S.C. § 2517(5). “[T]he purpose of 7 § 2517(5) . . . is to prevent ‘subterfuge searches,’ in 8 which the government uses a warrant authorizing seizure of 9 one type of evidence as a license to collect evidence of an 10 offense not covered by the authorization.” United States v. 11 Smith , 726 F.2d 852, 865 (1st Cir. 1984). “‘[O]ther’ 12 offenses under Section 2517(5) may include offenses, federal 13 as well as state, not listed in Section 2516 so long as 14 there is no indication of bad faith or subterfuge by the 15 federal officials. . . .” In re Grand Jury Subpoena Served 16

on Doe , 889 F.2d 384, 387 (2d Cir. 1989). 17 When an authorized wiretap intercepts “communications 18 relating to offenses other than those specified in the order 19 of authorization,” 18 U.S.C. § 2517(5), “disclosure or use” 20 of those communications is permissible provided “a 21 subsequent application . . . made to a judge of competent 22

15jurisdiction [demonstrates] the good faith of the original 1 application.” United States v. Marion , 535 F.2d 697, 700 2 (2d Cir. 1976). “Such subsequent application would include 3 a showing that the original order was lawfully obtained, 4 that it was sought in good faith and not as a subterfuge 5 search, and that the communication was in fact incidentally 6 intercepted during the course of a lawfully executed order.” 7 Id. (quoting S. Rep. No. 90-1097, at 2189 (1968)). We 8 perceive no reason why the principle undergirding this rule 9 - that disclosure or use of communications intercepted 10 incidentally to an otherwise lawful, good faith wiretap 11 application does not violate Title III - should not apply 12 when the Government forthrightly discloses the probability 13 of intercepting “communications relating to other offenses” 14

ex ante , at the time it makes its initial wiretap 15 application. “Congress did not intend that a suspect be 16 insulated from evidence of one of his illegal activities 17 gathered during the course of a bona fide investigation of 18 another of his illegal activities merely because law 19 enforcement agents are aware of his diversified criminal 20 portfolio.”United States v. McKinnon , 721 F.2d 19, 23 (1st 21 Cir. 1983). 22

16In this case, Government investigators indicated in the 1 wiretap applications that, in addition to wire fraud, they 2 expected to uncover evidence of securities fraud (which, 3 they expressly noted, is “not a predicate offense under 18 4 U.S.C. § 2516”). This representation ensured that the 5 wiretaps were not obtained as a “subterfuge” or to 6 surreptitiously investigate crimes other than those about 7 which they informed the court. 8 8 “[W]hen the government investigates insider trading for 9 the bona fide purpose of prosecuting wire fraud, it can 10 thereby collect evidence of securities fraud, despite the 11 fact that securities fraud is not itself a Title III 12 predicate offense.” Rajaratnam , 2010 WL 4867402, at *6. 13 The ten judges reviewing wiretap applications in this case 14 found that the Government proved that it had a good-faith 15 investigation of wire fraud and/or money laundering. The 16 fact that the Government also informed the approving courts 17 that Defendants were involved in a conspiracy to commit 18 securities fraud did not immunize Defendants from otherwise 19

8 Kimelman argues that not every case of insider trading will involve wire fraud. We do not reach the question of whether insider trading not involving wire fraud might permit a court to approve a wiretap; we instead focus on the case at hand in which Defendants’ conduct constituted both. 17lawful interception of communications related to their wire 1 fraud. The wiretap evidence was lawfully obtained and 2 properly admitted. 3

**II. The Jury Had Sufficient Evidence to Convict Kimelman of**  4 **Securities Fraud** 5 6 Kimelman challenges the sufficiency of the evidence 7 supporting his substantive securities fraud conviction for 8 his purchase of 15,000 shares of 3Com stock on August 10, 9 2007 and 5,000 shares of 3Com stock on September 25, 2007. 10 Specifically, he contends that the Government did not prove 11 that Goffer had tipped him about 3Com or that he knew or 12 consciously avoided knowing that Goffer had material 13 nonpublic information about 3Com that was disclosed in 14 violation of a fiduciary duty. 9More specifically, he 15 argues that the Government’s main evidence, an unrecorded 16 phone call he had with Goffer on August 7 and an email he 17 wrote to Goffer on August 15, does not indicate that he 18 received a tip from Goffer or knew that any such tip was 19 based on illegally-disclosed information. He also insists 20 that a discussion he had with the other co-conspirators on 21

9Kimelman does not challenge, and we therefore do not discuss, any elements of insider trading aside from the knowing use of material nonpublic information obtained in violation of a fiduciary duty. 18September 27, on the eve of the deal’s announcement, cannot 1 count as proof of his awareness of the earlier fraud. 2 “[A] liable tippee must know that the tipped 3 information is material and non-public . . . ‘and the tippee 4 knows or should know that there has been a breach’” of 5 fiduciary duty. SEC v. Obus , 693 F.3d 276, 287 (2d Cir. 6 2012) (emphasis retained) (quoting Dirks v. SEC , 463 U.S. 7 646, 660 (1983)). The Government did not need to prove that 8 Kimelman knew the identity or nature of the source if he 9 knew that the information was illegally obtained. Id. In 10 denying Kimelman’s Rule 29 motion, the district court 11 described this as “a verdict that could go either way” and 12 “certainly a close case,” but decided that the “jury’s 13 verdict [was not] unreasonable such that it should be 14 overturned.” Reviewing de novoand “crediting ‘every 15 inference that the jury may have drawn’ in the government’s 16 favor,” we agree. United States v. Hassan , 578 F.3d 108, 17 122 (2d Cir. 2008) (quoting United States v. Finley, 245 18 F.3d 199, 202 (2d Cir. 2001)). 19 A court examines each piece of evidence and considers 20 its probative value before determining whether it is 21 unreasonable to find “the evidence in its totality, not in 22

19isolation,” sufficient to support guilt beyond a reasonable 1 doubt. United States v. Autuori , 212 F.3d 105, 114 (2d Cir. 2 2000). This requirement is particularly critical where, as 3 here, some evidence derives its probative force from other 4 evidence. “‘[T]he jury’s verdict may be based entirely on 5 circumstantial evidence.’” United States v. Santos , 541 6 F.3d 63, 70 (2d Cir. 2008)(quotingUnited States v. 7 Martinez , 54 F.3d 1040, 1043 (2d Cir. 1995)). Moreover, we 8 need not find that every reasonable jury would have 9 convicted Kimelman; we affirm “if we find that any rational 10 trier of fact could have found the essential elements of the 11 crime beyond a reasonable doubt.” United States v. Stewart , 12 590 F.3d 93, 109 (2d Cir. 2009) (internal quotation marks 13 omitted, emphasis in original). 14 Kimelman argues that we should exclude from our 15 analysis evidence related to activity after the trades at 16 issue. We reject this argument. Kimelman’s knowledge of 17 the illicit nature of Goffer’s source after the trades is 18 still probative (though not in itself sufficient to 19 establish his knowledge before the trades). 20 Evidence indicating a defendant’s knowing participation 21 in a later stock manipulation scheme is relevant to the 22

20earlier scheme where, for example, it shows that a defendant 1 was “conversant in the language of stock manipulation.” 2 United States v. Rutkoske , 506 F.3d 170, 177 (2d Cir. 2007). 3 This analysis applies equally in the context of insider 4 trading. “Relevancy cannot be reduced to [a] mere 5 chronology; whether the similar act evidence occurred prior 6 or subsequent to the crime in question is not necessarily 7 determinative to its admissibility[ and therefore its 8 probative value].” United States v. Ramirez , 894 F.2d 565, 9 569 (2d Cir. 1990). Subsequent acts are frequently 10 probative as to intent. See, e.g., United States v. 11
Germosen , 139 F.3d 120, 127-28 (2d Cir. 1998). Here, 12 Kimelman’s participation in Goffer’s ongoing scheme led to 13 later transactions that “so closely paralleled the charged 14 conduct that it was probative regardless of the temporal 15 difference.” United States v. Curley, 639 F.3d 50, 61 (2d 16 Cir. 2011). 17 If we focus on the evidence in the record from prior to 18 the public announcement of Bain’s bid for 3Com on September 19 28, 2007, and credit every inference that the jury could 20 have drawn in the Government’s favor, we find ample support 21 for the jury to conclude that Kimelman was tipped by Goffer 22

21and knew or consciously avoided knowing that Goffer’s tip 1 about 3Com was based on nonpublic information illegally 2 disclosed in breach of a fiduciary duty. 3 The Kimelman-Goffer telephone call of August 7, though 4 unrecorded, marked a change in Kimelman’s 3Com stock trading 5 behavior. Prior to August 7, Kimelman day-traded 3Com stock 6 in smaller quantities of 1,000, 2,000 and 5,000 shares, 7 including on August 5, just two days before the call. 8 Kimelman did not maintain those positions but sold them 9 before the end of each trading day. On August 8, the day 10 after the evening phone call, however, Kimelman bought 11 94,200 shares of 3Com, easily his largest single-day 12 purchase, which he did not sell. In the subsequent days and 13 weeks, he continued to add to that position - buying another 14 24,000 shares on August 9 and 15,000 more shares on August 15 10. He maintained the accumulated position until after the 16 3Com merger bid was announced; when the share price shot up, 17 he sold the position and profited. 18 Kimelman was so aggressive in acquiring 3Com that his 19 employer at Quad restrained him from making further 20 purchases of 3Com stock. Despite the warning from Quad, 21 Kimelman managed to buy 5,000 more shares of 3Com on 22

22September 25. From August 7 to 8, Kimelman's behavior 1 changed from being very cautious about 3Com to suddenly 2 becoming very confident. Such a sudden change in a 3 defendant’s stock trading pattern, which cannot be readily 4 explained by other reasons, could be probative of trading on 5 insider information. See United States v. Smith , 155 F.3d 6 1051, 1069 (9th Cir. 1998)(recognizing “situations in which 7 unique trading patterns or unusually large trading 8 quantities suggest that an investor had used inside 9 information”). 10 His e-mail to Goffer on August 15, with news of Quad’s 11 restraint, indicates at the very least that the two were 12 actively discussing the trading in 3Com shares. Kimelman’s 13 new 3Com trading behavior matched that of Goffer and of the 14 other co-conspirators who were tipped by Goffer on August 7. 15 And like the others, Kimelman cashed out of his 3Com 16 positions shortly after Bain’s bid was announced. Parallel 17 trading patterns among co-conspirators can be another 18 indicator of insider trading. See, e.g., SEC v. Warde , 151 19 F.3d 42, 47-48 (2d Cir. 1998). In this case, the manner in 20 which Kimelman sold the stock is at least suggestive of the 21 motive he had for buying it, which was not for long term 22 investment value, but in anticipation of a particular event. 23

23Also revealing is the discussion Kimelman had with 1 Goffer on the eve of the 3Com deal’s announcement on 2 September 27. Goffer asked about the significance of 3 signature pages in a pending transaction, and Kimelman 4 explained that the preparation of the signature pages meant 5 that a deal signing was imminent. As a former associate at 6 a leading corporate law firm, Kimelman had to know that 7 Goffer, in asking such a question, was privy to the inner 8 workings of a pending transaction to be aware of the status 9 of signature pages. Since Goffer had no legal basis to have 10 access to such information, Kimelman must therefore have 11 known or been aware of a high probability that this insider 12 information was made available to Goffer in breach of a 13 fiduciary duty. Indeed, it was from this exchange that 14 Plate, who testified about the conversation, became 15 convinced that Goffer’s tip was illegally obtained. 16 Kimelman also argues that much of the Government’s 17 evidence applied equally convincingly to Plate, who claimed 18 at trial that he did not know of Goffer’s inside source 19 until the “signature pages” conversation. However, a 20 rational juror could readily infer from the trust that 21 Goffer showed in Kimelman by asking him about the signature 22

24pages and the matter-of-fact manner in which Kimelman 1 answered - without astonishment as to Goffer’s knowledge or 2 expression of concern about the sensitivity of such 3 information - that Kimelman shared a relationship of trust 4 with Goffer that Plate did not. This, in turn, would 5 support an inference that Kimelman had some degree of prior 6 awareness of Goffer’s illegal source of information, even if 7 the jury also concluded that Plate had no such awareness. 8 Moreover, the jury was free not to credit Plate’s 9 self-serving testimony that he did not know about the source 10 of the inside information. “[W]e defer to a jury’s 11 assessments with respect to credibility [as long as they 12 are] ‘reasonably based on evidence presented at trial.’” 13 United States v. Torres , 604 F.3d 58, 67 (2d Cir. 2010) 14 (quoting United States v. Ceballos , 340 F.3d 115, 125 (2d 15 Cir. 2003)). 16 After September 2007, evidence of his knowledge of the 17 fraud becomes overwhelming and Kimelman does not deny the 18 sufficiency of the showing in support of his conspiracy 19 conviction. Goffer later described Kimelman and Emanuel as 20 members of his “inner circle” or “tight circle.” A rational 21 juror could find that this circle came together well before 22

25those statements were made and prior to the beginning of the 1 3Com trades. The government produced evidence from July 2 2007 showing that the trio bought and profited from shares 3 of Hilton Hotels shortly after Goffer received an insider 4 tip. Goffer and Emanuel, along with co-conspirators outside 5 the “inner circle,” bought shares of 3Com on August 7. 6 Kimelman’s habit of feigning indifference to the source of 7 Goffer’s information in the presence of co-conspirators not 8 within the “inner circle” also continued in the subsequent 9 months. 10 Viewed in its totality, the Government’s proof provides 11 enough evidence for a reasonable jury to conclude that 12 Kimelman was guilty beyond a reasonable doubt of insider 13 trading in 3Com. The jury’s verdict is supported by 14 sufficient evidence and is not unreasonable; we affirm 15 Kimelman’s conviction. 16 **III. The Conscious Avoidance Jury Instructions Were Proper** 17 Over Kimelman’s objections, 10the district court 18

10The Government urges plain error review, maintaining that Kimelman did not specifically object to the conscious avoidance instruction as to each charge or request that the district court limit the instructions to the conspiracy charge. However, Defendants went to lengths to ensure that their objections to all conscious avoidance instructions were preserved, and the district court acknowledged that “[e]verybody’s preserving their objections [to the conscious avoidance instructions].” We therefore engage in de novo review. United States v. Kozeny, 667 F.3d 122, 130 (2d Cir. 2011). 26instructed the jury on the theory of “conscious avoidance,” 1 which permits a jury to convict a defendant for 2 “deliberately clos[ing] his eyes to what would otherwise 3 have been obvious to him.” United States v. Gansman , 657 4 F.3d 85, 94 (2d Cir. 2011). Kimelman appeals the issuance 5 and the substance of jury instructions on conscious 6 avoidance as to the illicit origins of Goffer’s tips. 7 Finding no flaw in either, we affirm. 8 **A. There Was a Factual Predicate for the Instruction** 9 “A conscious avoidance instruction ‘may only be given 10 if (1) the defendant asserts the lack of some specific 11 aspect of knowledge required for conviction [] and (2) the 12 appropriate factual predicate for the charge exists, i.e. 13 the evidence is such that a rational juror may reach the 14 conclusion beyond a reasonable doubt that the defendant was 15 aware of a high probability of the fact in dispute and 16 consciously avoided confirming that fact.’” United States 17 v. Svoboda , 347 F.3d 471, 480 (2d Cir. 2003) (quoting United 18 States v. Ferrarini , 219 F.3d 145, 154 (2d Cir. 2000)) 19 (internal alterations and some quotation marks omitted). In 20 this case, the first prong is met; Kimelman claimed 21 ignorance at trial as to the source of the 3Com tip. 22

27However, Kimelman contends that there was insufficient 1 evidence (1) for a juror to conclude that he was aware of a 2 high probability that the 3Com tip came from an insider and 3 chose to avoid confirming that fact, and (2) for a juror to 4 conclude that he ever knew about the illicit nature of 5 Goffer’s information. We disagree. 6 For substantially the same reasons discussed above, 7 there was ample evidence supporting the inference that if 8 Kimelman did not know about those facts, that he had to have 9 consciously avoided becoming aware of them. First, given 10 the 25-minute telephone conversation he had with Goffer on 11 the evening of August 7, the abrupt and pronounced change in 12 his trading pattern of 3Com stock immediately thereafter, 13 his subsequent outreach to Goffer about 3Com trading on 14 August 15, and the fact that Goffer had shared the tip with 15 other co-conspirators whom Kimelman knew, a rational juror 16 was entitled to conclude that Kimelman was aware of a high 17 probability that Goffer had insider information about 3Com. 18 Second, the fact that Goffer asked about signature pages on 19 the eve of the 3Com deal announcement and the routine manner 20 in which Kimelman answered the question, again provides the 21 basis for a juror to conclude that he was aware of a high 22

28probability that the source of Goffer's information was 1 illegal. 2 With respect to Kimelman’s conscious avoidance of 3 knowledge of Goffer’s sources throughout the conspiracy, 4 Kimelman’s challenge lacks any merit. While he and Kimelman 5 were recruiting Slaine for Incremental, Goffer told Slaine 6 that he was “better off not knowing where [his tips] were 7 coming from.” Gov’t Ex. 222. That way, Goffer continued, 8 if “someone from the government ever ask[ed] you where did 9 [that tip] come from. You [would] be like, I don’t freakin’ 10 know where it came from.” Building on Goffer’s (facetious) 11 assertion that his source was a construction worker, 12 Kimelman added that it was a “[g]uy fixing that pothole down 13 there.” His additions to this conversation about the need 14 for plausible deniability underscore Kimelman’s conscious 15 avoidance of knowledge as to Goffer’s source. The jury was 16 entitled to hear the conscious avoidance instruction. 17 Kimelman’s argument that the Government’s evidence 18 sought to prove actual knowledge rather than conscious 19 avoidance is both unsupported and irrelevant. “Red flags 20 about the legitimacy of a transaction can be used to show 21 both actual knowledge and conscious avoidance.” United 22

29States v. Ferguson , 676 F.3d 260, 278 (2d Cir. 2011) (citing 1 United States v. Nektalov, 461 F.3d 309, 316-17 (2d Cir. 2 2006)). 3 **B. The Content of the Instructions Was Proper** 4 Kimelman alleges that the district court erred in 5 declining to amend its jury instructions to accord with the 6 Supreme Court’s ruling in Global-Tech Appliances, Inc. v. 7
SEB S.A. , -- U.S. --, 131 S. Ct. 2060 (2011). Specifically, 8 Kimelman contends that the Global-Tech decision required 9 that jury charges indicate that “the mental state of 10 recklessness is insufficient for a finding of conscious 11 avoidance.” Because Global-Tech did not alter the conscious 12 avoidance standard, we hold that the district court’s 13 refusal to amend the jury instructions to accord with 14 Global-Techwas not error. 15

In Global-Tech , the Supreme Court synthesized conscious 16 avoidance holdings from eleven circuit courts in order to 17 import the doctrine from criminal law to patent law. 131 S. 18 Ct. at 2070 n.9 and 2068-72. The Court did not alter or 19 clarify the doctrine, but instead identified the common 20 ground among the Courts of Appeals: 21 [A]ll[Courts of Appeals] appear to agree on two 22 basic requirements: (1) the defendant must 23

30subjectively believe that there is a high probability 1 that a fact exists and (2) the defendant must take 2 deliberate actions to avoid learning of that fact. 3 We think these requirements give willful blindness an 4 appropriately limited scope that surpasses 5 recklessness and negligence. 6 7 Id. at 2070 (emphasis added). 8 Kimelman urges us to believe that this language, built 9

upon, inter alia , Second Circuit precedent in Svoboda , 347 10 F.3d at 477-78, was designed to alter the substantive law. 11 Global-Tech simply describes existing case law. In so 12 holding, we follow other decisions in this Circuit since 13 Global-Tech that have applied the traditional conscious 14 avoidance doctrine. See, e.g., United States v. Coplan , 703 15 F.3d 46, 90 (2d Cir. 2012); Ferguson , 676 F.3d at 278-79. 16 The district court’s instructions in this case properly 17 imposed the two requirements discussed by the Global-Tech 18 decision. 11Kimelman requested that the district court 19

11The district court instructed that: [A] defendant’s knowledge may be established by proof that the defendant you are considering deliberately closed his eyes to what otherwise would have been obvious to him. If you find beyond a reasonable doubt that the defendant’s ignorance was solely and entirely the result of a conscious purpose to avoid learning the truth, then this element may be satisfied. However, guilty knowledge may not be established by demonstrating that the defendant was merely negligent, foolish or mistaken. If, for example, you find beyond a reasonable doubt that the defendant you are considering was aware that 31insert the word “reckless” into a list of mental states that 1 were insufficient. However, Global-Techmakes clear that 2 instructions (such as those in this case) that require a 3 defendant to take “deliberate actions to avoid confirming a 4 high probability of wrongdoing” are inherently inconsistent 5 with “a reckless defendant . . . who merely knows of a 6 substantial and unjustified risk of such wrongdoing.” 131 7 S. Ct. at 2070-71. The district court’s instructions were 8 consistent with Global-Tech ; we therefore affirm Kimelman’s 9 conviction. 10

**IV. Evidence of Kimelman’s Rejection of a Plea Bargain Was**  11 **Properly Excluded** 12 13 Kimelman contends that the district court erred in 14 excluding his rejection of a plea bargain. “The trial 15 court’s . . . assessment that the probative value of 16 relevant evidence is [] substantially outweighed by the 17

there was a high probability that he obtained information that had been disclosed in violation of a duty of trust and confidential [sic] but deliberately and consciously avoided confirming this fact, then you may find that the defendant acted knowingly. However, if you find that the defendant actually believed that the information he obtained was not disclosed in violation of a duty of trust and confidence, he may not be convicted. It is entirely up to you whether you find that the defendant you are considering deliberately closed his eyes and any inferences to be drawn from the evidence on this issue. Tr. 2019-20 (emphasis added). 32danger of unfair prejudice [is] reviewed only for an abuse 1 of discretion.” United States v. Khalil , 214 F.3d 111, 122 2 (2d Cir. 2000) (internal quotation marks omitted). Kimelman 3 argues by analogy to United States v. Biaggi , 909 F.2d 662, 4 690-93 (2d Cir. 1990), in which we held that the defendant’s 5 decision to forgo immunity out of an insistence that he was 6 innocent was probative of his “consciousness of innocence.” 7 Id. at 690. 8 The defendant in Biaggi was offered complete immunity. 9 Id. Relying on the difference between this and “an offer to 10 plead guilty to reduced charges,” we held that a defendant’s 11 decision to reject an offer of immunity was probative. Id. 12 at 690-91. We did “not decide whether a defendant is 13 entitled to have admitted a rejected plea bargain.” Id. at 14 691. 15 This case differs from Biaggi because the excluded 16 evidence here lacked any probative value. Kimelman has 17 detailed the “devastating collateral consequences” flowing 18 from the entry of a criminal conviction against him. 12 19

12Kimelman wrote that: The effects of [his] arrest, trial and conviction have been devastating to him, personally, emotionally, professionally and financially. [He] will never again work in the securities industry, and will be stripped of 33Although the parties disagree as to the terms of the 1 rejected plea offer, both parties concede that it would have 2 entailed a conviction. This was not a case where the 3 defendant was permitted to walk away scot free and declined 4 to do so out of a strong belief of his innocence. Rejecting 5 this offer was, in this case, an indication “that the 6 defendant prefer[red] to take his chances on an acquittal by 7 the jury, rather than accept the certainty of punishment 8 after a guilty plea.” Id. 9 The district court briefly discussed the prejudicial 10 effects of admitting this evidence, including the likelihood 11 of jury confusion. Admission would require the “collateral 12 consequences” of a conviction to be discussed at length, 13 requiring an already complex trial to gain additional and 14 unnecessary dimensions. We find that the trial court was 15

his trading licenses. He will no longer hold his credential as a Chartered Financial Analyst. In addition, [he] will no longer be entitled to the privilege of practicing law. Upon the conclusion of his sentence, [he] will be left with the daunting task of finding a career without the ability to return to any of the professions he has known for the past fourteen years. His finances are in shambles . . . with several hundred thousand dollars of debt outstanding. And he has suffered the personal embarrassment and shame that accompanies a high profile arrest, trial and conviction. Kimelman Sentencing Memorandum at 14. 34within its “latitude” in excluding Kimelman’s rejection of a 1 plea agreement under Federal Rule of Evidence 403. See 2 Holmes v. South Carolina , 547 U.S. 319, 324-25 (2006). 3

**V. Defendants’ Sentences Were Reasonable**  4 Goffer and Drimal challenge the substantive and 5 procedural reasonableness of their sentences. The role of 6 appellate courts in sentencing is important but limited. 7 “We review the work of district courts under a ‘deferential 8 abuse-of-discretion standard.’” United States v. Cavera , 9 550 F.3d 180, 189 (2d Cir. 2008) ( en banc ) (quoting Gall v. 10 United States , 552 U.S. 38, 41 (2007)). 11

**A. Defendants’ Sentences Were Procedurally Reasonable**  12 Defendants contend that the district court committed 13 procedural error in sentencing them. In reviewing 14 sentencing for procedural errors, we first look for “error 15 in the district court’s calculation of the [United States 16 Sentencing] Guidelines range.” Id. at 194. Here, Drimal 17 argues that the district court erred in its loss 18 calculations and Goffer contends that the district court 19 failed to consider disparities between co-defendants. 20 21 22

35**1. The Loss Calculation Was Proper** 1 In calculating the “loss” attributable to Drimal’s 2 trading, the district court took account of the Probation 3 Office’s Presentence Investigation Report as well as 4 submissions from the parties. The district court accepted 5 the Government’s assertion that Drimal realized gains of 6 between $7 and $20 million, resulting in a Guidelines 7 enhancement of 20 points. See U.S.S.G. §§ 2B1.4(b)(1), 8 2B1.1(b)(1)(K). Drimal asserted that his gains were between 9 $2.5 and $7 million, for an enhancement of 18 points. 10 U.S.S.G. § 2B1.1(b)(1)(J). Drimal alleges two errors in the 11 calculation of the loss amount. 12 First, Drimal contends that the district court 13 committed procedural error by failing “to deduct losses 14 resulting from trades that emanated from the same” insider 15 sources as provided the tips that gave him $11 million in 16 profits. We interpret this argument as relating to the 17 Clear Channel trades Drimal made based on the attorneys’ 18 misunderstanding of inside information. We find no 19 precedent indicating that additional illegal trades made on 20 material nonpublic information that result in losses should 21 mitigate the sentences of insider traders. Cf. U.S.S.G. § 22

362B1.1 n.3. If two defendants are identical save that 1 Defendant A engaged in one more insider trade than Defendant 2 B, there is no case in which Defendant A deserves a lesser 3 punishment than Defendant B. That Defendant A’s additional 4 criminal activity backfired does not affect that calculus. 5 The district court did not err in excluding these losses 6 from its calculation. 7 Drimal also contends the district court erred in 8 considering the Hilton trades for the calculation of the 9 loss amount. This contention relies on Drimal’s assertion 10 that he did not know that the Hilton trades were based on 11 inside information until two months later (when he was 12 recorded making statements that clearly demonstrate his 13 awareness that his profits from the Hilton trade were 14 illegally-obtained profits of insider trading). Reviewing 15 the district court’s fact-finding at sentencing, we find no 16 error in the court’s extensive and well-reasoned analysis. 17 **2. The District Court Considered Disparities**  18 **Between Defendants** 19 20 Goffer asserts that the district court did not account 21 for sentencing disparities between similarly-situated 22 defendants. This argument contains both a procedural and 23 substantive challenge. To the extent that Goffer asserts 24

37that the district court did not considerthe sentences of 1 similarly-situated defendants, his claim lacks merit. 13The 2 district court weighed “the need to avoid unwarranted 3 sentencing disparity between Mr. Goffer and similarly 4 situated defendants.” The district court distinguished 5 between Goffer and his co-defendants and also described 6 Goffer’s role as a “leader[] of a fraudulent enterprise” who 7 “recruited people” and poisoned other traders. Sentencing 8 Tr. 228. The district court demonstrated that it weighed 9 the need for similar sentences among similarly-situated 10 defendants; however, the court rejected Goffer’s contentions 11 as to who was situated similarly. 12

**B. Defendants’ Sentences Were Substantively Reasonable**  13 Goffer and Drimal challenge their sentences as 14 substantively unreasonable, contending that their (120-month 15 and 66-month, respectively) sentences are disproportionate 16 to sentences meted out to other white collar criminals. 14 17

13To the extent that it is an assertion that Goffer, as a white collar defendant, should benefit from the leniency of other courts towards other white collar defendants, we address this argument as part of the substantive reasonableness inquiry.

14Although defendants’ challenges to their sentences also sound of Eighth Amendment jurisprudence, so construed they are devoid of merit. See United States v. DiTommaso , 817 F.2d 201, 217 (2d Cir. 1987). We therefore assume the challenges focus on the substantive reasonableness of the sentences. 38Believing that the district court’s well-reasoned analysis 1 was appropriate, we affirm. 2 In reviewing a sentence for substantive reasonableness, 3 we do “not substitute our own judgment for the district 4 court’s on the question of what is sufficient to meet the 5 [18 U.S.C.] § 3553(a) considerations in any particular 6

case.” Cavera , 550 F.3d at 189 (citing United States v. 7 Fernandez , 443 F.3d 19, 27 (2d Cir. 2006)). “We will 8 instead set aside a district court’s substantive 9 determination only in exceptional cases where the trial 10 court’s decision ‘cannot be located within the range of 11 permissible decisions.’” Id. (quoting United States v. 12 Rigas , 490 F.3d 208, 238 (2d Cir. 2007)). 13 “[A] district court may vary from the Guidelines range 14 based solely on a policy disagreement with the Guidelines, 15 even where that disagreement applies to a wide class of 16 offenders or offenses.” Id. at 191 (citing Kimbrough v. 17 United States , 552 U.S. 85, 107-08 (2007)). Defendants in 18 this case assert that several district court judges have 19 chosen to exercise this ability to issue below-Guidelines 20 sentences to white collar criminals. Goffer and Drimal 21 raise broad questions as to how harsh federal courts are, 22

39and how harsh they should be, in sentencing white collar 1 defendants. We need not answer either question. 2 Assuming arguendo that some judges have chosen as a 3 policy matter not to sentence white collar criminals to the 4 harshest permissible punishments, this does not entitle 5 other white collar criminals to lighter punishments than are 6 reasonable under the Guidelines, 18 U.S.C. § 3553(a), and 7 the totality of the circumstances of their individual case. 8 See, e.g., United States v. Rigas , 583 F.3d 108, 121-24 (2d 9 Cir. 2009); United States v. Bonilla , 618 F.3d 102, 110 (2d 10 Cir. 2010). 11 **1. Goffer’s Sentence Was Substantively Reasonable**  12 Goffer faced a maximum of 20 years’ imprisonment for 13 each of 12 counts of securities fraud. Goffer had an 14 offense level of 32 and a criminal history category of I, 15 yielding a Guidelines range of 121 to 151 months’ 16 imprisonment. The Probation Office recommended that he be 17 sentenced to 121 months’ imprisonment. 18 In reaching its determination, the district court 19 considered “Goffer’s entire life from the circumstances of 20 his birth, his upbringing, educational background and 21 opportunities, work history, family relationships . . . 22

40[and] the facts and circumstances of these crimes.” 1 Sentencing Tr. 12. The court also considered “[t]he need to 2 avoid unwarranted sentencing disparity between Mr. Goffer 3 and similarly situated defendants.” Id. at 13. 4 The totality of the circumstances in this case included 5 reasons to believe that Goffer had played a positive role in 6 the lives of his family and friends, but also that Goffer 7 orchestrated and ran a large-scale cash-for-tips scheme to 8 fuel an insider trading conspiracy. Goffer took steps to 9 disguise his wrongdoings by distributing disposable cell 10 phones, using fake research to cover his illegal trades, and 11 refusing to speak about sensitive topics on the telephone. 12 Goffer’s corrosive influence on the integrity of the 13 financial markets and on the expectation of trust and 14 confidence between attorney and client required a 15 significant punishment. We do not find that his below16 Guidelines sentence of 120 months’ imprisonment was 17 unreasonable or disproportionate to the severity of his 18 crimes. 19 **2. Drimal’s Sentence Was Substantively Reasonable**  20 Drimal contends that his sentence of 66 months’ 21 imprisonment was substantively unreasonable in light of his 22

41community service and his commitment to his family. Drimal 1 faced a maximum of 20 years’ imprisonment on five counts of 2 securities fraud. His offense level of 25 and Criminal 3 History Category of I led to a Guidelines range of 57 to 71 4 months’ imprisonment. The Probation Office recommended a 5 57-month sentence. 6 Drimal, who traded more heavily based on insider 7 information than any other defendant in the conspiracy, 8 asserts that his community service and commitment to his 9 family should mitigate his wrongdoing. The district court 10 took note of his positive activities in sentencing Drimal. 11 The district court also noted that Drimal, who “earned” 12 approximately $11,497,888 from trading on insider 13 information, did not have the same compelling social 14 disadvantages that frequently lead to and help explain 15 criminal behavior. 15 16 In light of the magnitude of his insider trading, which 17 had major deleterious effects on the market, Drimal was no 18 small-time criminal. The district court noted Drimal’s lack 19

15Contrary to Drimal’s assertions on appeal, the district court did not reveal a vendetta against the rich when it noted that Drimal did not have compelling reasons to warp the financial markets. Instead, Judge Sullivan recognized the same moral principles that make Jean Valjean more sympathetic than Gordon Gekko. 42of respect for the law and his deliberate decision, weighing 1 the risks, that insider trading “was a game worth playing.” 2 Sentencing Tr. 48. The district court’s assertion that 3 insider trading requires high sentences to alter that 4 calculus is a Congressionally-approved example of giving 5 meaning to the 18 U.S.C. § 3553(a) factors. The district 6 court’s well-reasoned sentencing took account of the 7 totality of circumstances, including Drimal’s motivations, 8 his positive role in his family and the community, his 9 knowledge that what he was doing was wrong, and the severity 10 of his crimes. We affirm. 11 12 **Conclusion** 13 For the foregoing reasons, the judgments of conviction 14 and the sentencing orders of the district court are **AFFIRMED**

. 15 Defendants’ additional arguments are addressed in the 16 corresponding summary order. See Goffer, 2013 WL 3285137. 17

43