F ILED Unite d St at e s C ourt o f Appe als

Te nt h Ci r c uit 

### Se pt em be r 6, 200 7 Elisab eth A. Shumaker Clerk of Court 

### PU B L ISH UNI TED S TATES COURT OF AP P EALS

T E N T H C IRC U IT

UNI T E D S T AT E S OF AM E RI CA , Pl ai nt i ff- A ppel l ee, v. L AWRE NC E S E AN C ONL AN, D e fe n d a n t-A p p e llan t. N o. 06- 1510

A ppeal from t he U ni t ed St at es D i s t ri ct C ourt

for t he D i s t r i c t of

C ol or ado ( D . C . N o . 0 6 - C R - 0 0 0 6 6 - W D M ) S ub m i t t ed o n the B ri efs: R aym ond P. M oor e, Feder al Publ i c D efe nder , and Ly nn C . H ar t fi el d, A s s i s t ant F e d e ra l P u b lic D e fe n d e r, D e n v e r, C o lo ra d o , o n th e b rie fs fo r D e fe n d a n tA p p e llan t. T r oyA . E i d, U ni t ed St at es A t t or ney , and M ar t ha A . Pal uch, A s s i s t antU ni t ed St at es A t t or ney , D enver , C ol or ado, on t he br i ef forPl ai nt i ff- A ppel l ee. B efor e HENR Y , S EY M OUR , and GORS UCH , C i rcui tJudg es. S EY M OUR , C i r cui tJ udge.-2-

L aw r ence Sean C onl an appe al s hi s s ent ence of fi ft een mont hs forvi ol at i ng 26 U . S. C . §7206( 1) , t he fi l i ng of a fal s e i ncome t ax r etur n. M r . C onl an w as char ged i n a s even c ounti ndi ctm entforfi l i ng fal s e t ax r etur ns fort he y ear s 1998 th ro u g h 2 0 0 1 . T h e in d ictm e n t w a s p a rt o f a m u lti -sta te p ro se c u tio n o f in d iv id u a ls w ho w er e conne ct ed w i t h an or gani zat i on t hatm ar ket ed and s ol d fr audul entt ax sh elt er p rog ram s, o r w h o p arti cipa ted in the tax sh elt ers a s M r. C o n lan d id. M r. C on l an p l ed g uil t yt o o ne co un tof the i nd i ct m ent, adm i t t i ng t hat he fi l ed a fal se i ncome t ax r etur n fort he y ear2000. T he di s t r i ctcour ts ent ence d hi m att he b o tto m o f

th e a p p lica b le U n ited S tate s S e n ten c in g G u id e lin e ra n g e . O n a p p e a l, M r. C o n lan c laim s h is s e n ten c e is b o th p ro c e d u ra llya n d su b sta n tiv e ly un reas on able. E xerci si ng j uri sdi ct i on pu rs uan tt o 2 8 U . S . C . § 1 29 1, w e revers e t he di s t r i ctcour t ’ s s ent enci ng deci s i on and r emand forr es ent enci ng.

I A t sen tenc ing , the U n it ed S tat es P rob ati o n O ffice rec o m m en d ed the c o u rt i m pos e a s ent ence bel ow t he advi s or ygui del i ne r ange of fi ft een t o t w enty - one m o n th s a n d in ste a d im p o se a ter m o f th re e -y e a rs p ro b a tio n w ith th e first six m o n ths to b e se rve d in h o m e d eten ti o n . T h e ra ti o n ale fo r th e p rob ati o n o fficer’s r ecomm ended va r i ance w as t hatM r . C onl an’ s advi s or ygui del i ne r ange w as di s pr opor t i onat el yl ong w hen compar ed t o ot herdefe ndant s i nvol ved i n t he-3-

s cheme w ho had gr eat err es pons i bi l i t yand ca us ed gr eat erm onet aryl os s t o t he g o v e rn m e n t. T he U ni t ed St at es “vehe m ent l y ” obj ect ed t o t he var i ance , r ec. , vol . I V , at 21, and r epea t edl yar gued t o t he di s t r i ctcour tt hatM r . C onl an had the bur den of o v e rc o m in g a p re s u m p tio n th a t th e a d v is o ry g u id e lin e ra n g e w a s re a s o n a b le . See id . at35 ( “U ndert he 10th C i r cui tcas e l aw t hat ’ s emer gi ng, t her e i s a pr es um pt i on t hatt he s ent ence undert he gui del i nes i s a r eas onabl e one, and ther efor e ther e has to b e so m e th in g w ith re liab le e v id e n c e th a t w o u ld o v e rc o m e th e p re su m p tio n .); i d. at 36 (“T h e 1 0 th C ir cu itreq u ir es a g o o d rea so n . T h at’s w h at th e c ase law say s. It re q u ire s y o u to p re su m e th a t th e g u id e lin e ra n g e is re a so n a b le, is a re a so n a b le se n ten c e , u n les s y o u fin d so m e th in g is w ro n g w ith th o se g u id e lin e s f ro m re liab le e v id e n c e .”); id . at 3 8 (T h e g u id e lin e se n ten c e “ is a se n ten c e th a t is p re su m p tiv e ly rea so n ab le un d er the 1 0 th C ir cu itca se law . ”). In p ro n o u n c in g its s e n te n c e , th e d is tr ic t c o u rt b e g a n b ys a y in g , A s w e know , t he l aw t hatcontr ol s t hi s C our ti s now governed byt he fa c to rs s e t fo rt h in T itle 1 8 U .S .C . 3 5 5 3 (a ). T h e re a re s e v e ra l[ ,] i ncl udi ng t he gui del i ne r ecomm endat i ons w hi ch I do cons i der . T hey a re th e p ro d u c t o f

e x ten siv e stu d ya n d e x p e rie n c e , an d th e 1 0 th C irc u it h a s to ld u s th a t th o se c o n c lu sio n s a re p re su m p tiv e ly r eas onabl e. Id. at47. T he courtr ecogni zed thi s t o be a “ di ffi cul tcas e. ” Id . W h il e the co u rt s ai d i t“ce r t ai nl yr es pect [ed] [the pr obat i on offi ce’ s ] j udgm entand re c o m m e n d a tio n s a n d w h a t [ c o u n se l] a rg u e d , . . . it [w a s] n o t en o u g h . . . to-4-

over come t he pr es um pt i on of r eas onabl enes s of the gui del i nes . ” Id . at 50 . In compl et i ng i t s pr onouncement , t he courtadded,

A n d I w ill n o te fo r th e re c o rd a s w e ll th a t I a g re e w ith G overnm entcouns el t hatt he gui del i nes ar e pr et t ycl eart hatt he i nt entw as t o i ncr eas e cus t odi al s ent ence s w i t h t hei radopt i on fr om wh a th a d b e e n t h e p r a c t i c e o n a p r e g u i d e l i n e b a s i s . S o i ti s my concl us i on t hatt her e i s no r eas on form e nott o s ent ence t he d e fe n d a n t w ith in th e p re su m p tiv e ra n g e o f re a so n a b len e ss , an d I w ill do s o. Id . M r. C o n la n b e g a n h is fif te e n -m o n th s e n te n c e o n J a n u a ry 1 5 , 2 0 0 7 . See re c ., v o l. I , d o c . 4 4 . a t 2 . II W hen r evi ew i ng a s ent enci ng chal l enge, w e eva l uat e s ent ence s i m pos ed by th e d is tr ic t c o u rt fo r r e a s o n a b le n e s s . Uni t ed Stat es v. B ooker , 543 U . S. 220 (2 0 0 5 ); Un itedS ta tes v . Kris tl , 4 3 7 F .3 d 1 0 5 0 , 1 0 5 3 (1 0 th C ir . 2 0 0 6 ). “R eas onabl enes s has bot h s ubs t ant i al and pr ocedur al component s . ” Uni t ed Stat es v. C age , 451 F. 3d 585, 591 ( 10t h C i r . 2006) . Pr ocedur al r eas onabl enes s i nvol ves u s in g th e p ro p e r m e th o d to c a lc u la te th e s e n te n c e . Id. Subst ant i ve re a so n a b len e ss in v o lv e s w h e th e r th e len g th o f th e se n ten c e is re a so n a b le g iv e n a ll th e c ir c u m s ta n c e s o f

th e c a s e in lig h t o f

th e fa c to rs s e t fo rt h in 1 8 U .S .C . § 3 5 5 3 (a ). S e e Kris tl , 437 F. 3d at1053.

“ A se n ten c e c a n n o t, th e re fo re , b e c o n sid e re d re a so n a b le if th e m a n n e r in-5-

w hi ch i tw as det erm i ned w as unr eas onabl e. ” Id. at1055. I n Uni t ed Stat es v. B egay , 470 F. 3d 964, 977 ( 10t h C i r . 2006) , w e hel d i tw as err orfort he di s t r i ct co u rtto ap p lythe a p p ell ate p resu m p ti o n o f re aso n ab lene ss to the ad v isory gui del i nes w hen s ent enci ng. T hi s deci s i on w as r ece nt l yval i dat ed, al t hough not s peci fi cal l ym ent i oned, i n R i t a v. Uni t ed Stat es , 1 2 7 S . C t. 2 4 5 6 (2 0 0 7 ). 

### R ita c a l l s on di s tri c tc ourt s t o “ s ubje c t [] the de fe ndant ’ s s e nt e nc e t o . . . thor ough advers arial t es ting ,”includ ing con si derati onof argum ents thatthe guidelines se ntence“fai ls prop erlyto re flec t §35 53 (a) c on si derati on s. ” The Co urt e mpha s i z e d that“ [i ]n de t e rmi ni ng the m e ri t s of the s e argum e nt s , the s e nt e nc i ng court does not enjo ythe benefitof a l egalpresumption that the Gu idel ines se ntenceshou ld apply .” I d. at 2 4 5 8 . R ita thus m ake s c l e arthatthe pr e s umpti on o f reaso n ab len ess ap p lies o n lyat th e ap p ellate lev el. I d. at24 65 (“ Werepeatthat the pr e s umpti on be for e us i s an ap pellate co urt p resump tio n .”). See als o U nite d Sta tes v. Wilm s, ___ F. 3d ___, No. 06- 1896, 2007 W L 2077367 ( 6th Ci r . July23, 20 07 ) ( r e ve r s i ngandr e m and i ngde fe nd ant ’ s s e nt e nc e du e t o impo s i ti onof a pr e s umpti on of r e a s onabl e ne s s atdi s tri c tc ourtl e ve li n c ontr ave nti on t o R ita ). [ A ] d istrict co urt’s j o b is n o t to imp o se a reaso n ab le senten ce. R ath er, a d istrict co urt’s m an d ate is to imp o se a senten ce su f f icient, butnotgr e at e rthan ne c e s s ary , t o c omplywi th the purpos e s of s e c ti on 3553( a) ( 2) . Re a s onabl e ne s s i s the appe l l at e s t andard of r e vi e w i n judgi ng whe the radi s tri c tc ourtha s a c c ompl i s he d i t s t a s k. I d. at___, 2007 W L 20777367 at*3 ( quot ati on m arks , e mpha s i s , and c i t ati on-6-



### o mitted ). I n l i ghtof the r ece ntdeci s i on i n R ita and ourdeci s i on i n B egay , t he governm entr i ght l yconce des t he di s t r i ctcour terr ed i n affor di ng a pr es um pt i on of re a s o n a b le n e s s to th e re c o m m e n d e d a d v is o ry g u id e lin e s e n te n c e . A p le . B r. a t 3 2 . Bu ti ts u g g e s t s M r . Co n l a n s h o u l d b e h e l d t o a p l a i n e r r o rs t a n d a r d wh e n we r evi ew t he court ’ s err or . T o t he contr ary , w e ar e per s uaded M r . C onl an pr es er ved hi s ar gum entt hatt he gui del i nes ar e pr es um pt i vel yr eas onabl e onl yatt he appel l at e l evel w hen he a s s er t ed ats ent enci ng,

W hen y ou l ook att he 10th C i r cui tcas es , w e ar e t al ki ng about t he s t andar d of

r evi ew on appeal , an d th a t is w h a t [ sic ] th e c o u rt is s ay i ng att he 10th C i r cui tl evel and . . . t hi s i s goi ng t o be r es ol ved at s om e poi ntagai n att he Supr eme C our tbeca us e ther e ar e [ sic ] differ ences o f op i nion on t he v ari ou s ci rcui t s. R ec . , v o l. IV at 43 (em p h asis ad d ed ). W e the refo re rev iew the d istri ct co u rt ’s e rr o r fo r h a rm le s s n e s s . T o e s t a b l i s h h a r m l e s s e r r o r , t h e U n i t e d S t a t e s h a s t h e b u r d e n t o s h o w b y a pr eponder ance of the evi dence t hatt he di s t r i ctcour t ’ s err ordi d notaffectt he c o u rt ’s s e le c tio n o f

th e s e n te n c e im p o s e d . United S t ates v. Mon tgo m ery , 439 F. 3d 1260, 1263 ( 10t h C i r . 2006) . R ece nt l yi n United S t ates v. A rreval o-O lvera , ___ F. 3d ___, N o. 06- 2291, 2007 W L 2181514 ( 10t h C i r . J ul y31, 2007) , w e hel d a B egay e rro r w a s h a rm les s w h e re th e d istric t co u rt e x e rc ise d its d isc re tio n to i m pos e a s ent ence above th e lo w -e n d o f th e a p p lic a b le g u id e lin e ra n g e . Id. at-7-

___, *2. T he governm entcont ends ourdeci s i on i n A rreval o-O lvera sh o u ld p ersu ad e u s to find h arm less erro r he re a s w ell . W e d isag ree . U n li k e M r. A rrev alo-O lvera , M r. C o n lan w as se n tenc ed at th e v eryb o tt o m o f h is ad v isory gui del i ne r ange, a s i gn w e have t aken i n t he pas tt o i ndi cat e thatt he courtm ay have done s om ethi ng di ffe r ent l yhad i tnotfel tm i s t akenl ybound byt he g u id e lin e s . See, e. g. , B egay , 470 F. 3d at976- 77; Un itedS ta tes v . Nick l, 427 F. 3d 1 2 8 6 , 1 3 0 1 (1 0 th C ir. 2 0 0 5 ); Un ite dS ta te s v . L a b a s tid a -S eg u r a , 396 F. 3d 1140, 1143 ( 10t h C i r . 2005) . T he di s t r i ctcour t ’ s err oneous appl i cat i on of the p resu m p ti o n o f re aso n ab lene ss – u n d erstan d ab le giv en the g o v ern m en t’ s ar gum entand the pr e- R i t a confus i on i n t hi s ar ea – bl i nded i tt o t he opt i on of a var i ance . H er e, t he pr obat i on offi cerr ecomm ended a t er m of pr obat i on r ather th a n th e a d v iso ryg u id e lin e se n ten c e a n d th e d istric t co u rt c lea rlyter m e d it a

“ d iffic u lt c a s e .” R e c . v o l. I V , a t 4 7 . Itis al so tru e the d istri ct co u rtex p resse d co n ce rn re g ard ing M r. C o n lan’s h e s ita n c yto ta k e re s p o n s ib ility fo r h is a c tio n s a n d h is o v e ra ll d is h o n e s ty. See, e. g. , i d. at47, 49. T aki ng i nt o acc ountt hos e conc erns orot herappr opr i at e § 3 5 5 3 (a ) fa c to rs, th e c o u rt m a yd e ter m in e a g a in th a t th e g u id e lin e se n ten c e is r eas onabl e. B utgi ven thatt he r eas onabl enes s s t andar d i s and w as onl yan appel l at e s t andar d, w hatt he di s t r i ctcour tw i l l do upon r es ent enci ng abs entt he i l l egal pr es um pt i on “pl ace s us i n t he zone of s pecul at i on and conj ectur e. ”B eca us e w e ar e r ever s i ng M r . C onl an’ s s ent ence bas ed on the pr ocedur al * e rr o r, w e d o n o t a d d re s s h is s u b s ta n tiv e c h a lle n g e s to h is s e n te n c e . -8- L a b a s tid a -S eg u r a , 396 F. 3d at1143. A ccor di ngl y , w e R EV ER SE and RE M AND forr es ent enci ng. *