United States Court of Appeals

For the Eighth Circuit

___________________________

No. 11-1232

___________________________

United States of America

lllllllllllllllllllll Plaintiff - Appellant

v.

Abby Rae Cole

lllllllllllllllllllll Defendant - Appellee

____________

 Appeal from United States District Court 

for the District of Minnesota - St. Paul

____________

 Submitted: June 3, 2014

 Filed: August 29, 2014 

____________

Before MURPHY, BYE, and SHEPHERD, Circuit Judges.

____________

SHEPHERD, Circuit Judge.

A jury found Abby Rae Cole guilty of conspiracy to commit mail and wire

fraud, tax evasion, and conspiracy to commit tax fraud. The district court1

 sentenced

Cole to three years probation, a downward variance from the advisory Guidelines

1

The Honorable Michael J. Davis, Chief Judge, United States District Court for

the District of Minnesota.
range of 135 to 168 months imprisonment. The government appealed the sentence as

substantively unreasonable, and Cole cross-appealed her convictions. We affirmed

the convictions but declined to reach the issue of whether the sentence is substantively

unreasonable, finding procedural error in the lack of an adequate explanation by the

district court for the sentence and the substantial downward variance. We remanded

the case to afford the district court a chance to supply an adequate explanation. 

United States v. Cole, 721 F.3d 1016, 1025 (8th Cir. 2013).

In our previous opinion, we noted that before reaching the substantive

reasonableness of a sentence “‘[w]e must first ensure that the district court committed

no significant procedural error,’” such as “failing to adequately explain the chosen

sentence—including an explanation for any deviation from the Guidelines range.” Id.

(quoting United States v. Feemster, 572 F.3d 455, 461 (8th Cir. 2009) (en banc)). We

noted that Cole and her co-conspirators’ convictions were based on the theft of

approximately $33 million from Best Buy over a four-year period and the evasion of

over $3 million in taxes, Cole’s sentencing Guidelines range was 135 to 168 months

imprisonment, and Cole’s co-conspirators, her husband and a Best Buy employee,

received sentences of 180 and 90 months respectively. Despite these facts, the district

court provided scant explanation for the profound downward variance to a sentence

of probation. That scant explanation consisted of the following statements by the

district court following pronouncement of the sentence:

The Court has reviewed the case law from the United States Supreme

Court and also the Eighth Circuit Court of Appeals dealing with

sentencing. The Court is well aware and will use the factors under Title

18 Section 3553, and will vary in this matter . . .

It would be a travesty of justice if I sent you away for a long period of

time. I am taking a huge chance on you . . . .

-2-
We remanded the case to provide the district court an opportunity to adequately

explain “the defendant-specific facts and policy decisions upon which it relied in

determining that the probationary sentence is ‘sufficient, but not greater than

necessary,’ to achieve the sentencing objectives set forth in section 3553(a),” Cole,

721 F.3d at 1025 (citation omitted), in an effort to serve the twin goals of “meaningful

appellate review and . . . the perception of fair sentencing.” Gall v. United States, 552

U.S. 38, 50 (2007).

On remand, the district court received additional briefing from the parties,

conducted a hearing in which it heard additional argument with respect to sentencing,

and then announced its reasons for the downward variance and the probationary

sentence in a lengthy and comprehensive analysis concluding with the observation that

this is an “unusual, extraordinary case in which a sentence of three years probation

was appropriate.” In the additional analysis, the district court touched on all of the

section 3553(a) factors in explaining the rationale behind the sentence it imposed upon

Cole. The district court recognized the numerous restrictions Cole endured while on

probation2

 and the “lifelong restrictions” she faces as a federal felon, see 18 U.S.C.

§ 3553(a)(2)(A)&(B); the court stressed that, with the probationary sentence, Cole

would be less likely to commit further crimes as she “has a far greater likelihood of

successful rehabilitation with family support and stable employment,” see 18 U.S.C.

§ 3553(a)(2)(C). The court also explained that while “[t]his was one of the largest

corporate frauds in Minnesota history and was also a significant tax fraud,” Cole

served a more minor role as, in the court’s judgment, she was “mostly a passive,

although legally responsible, participant.” See 18 U.S.C. § 3553(a)(1). The court

focused on Cole’s history and characteristics, emphasizing that she had no prior

contact with law enforcement and was “markedly different” than “most of the

fraudsters who appear before th[e] Court” in that Cole “is not a consummate fraudster,

2

Cole had completed her probationary sentence three months prior to the

hearing. 

-3-
she is not a pathological liar.” See 18 U.S.C. § 3553(a)(6). Finally, the district court

explained that the probationary sentence would allow Cole to work and earn money

to make restitution to the victims of the fraud. See 18 U.S.C. § 3553(a)(7). 

The United States persists in its appeal, contending that the district court

improperly based the sentence on Cole’s socioeconomic status, her restitution

obligations, and her loss of criminally derived income. However, the facts of Cole’s

fall from an industrious and highly successful entrepreneur to convicted felon and the

loss of the bulk of her legitimately acquired assets cannot be denied. We find no error

in the district court’s reference to these events.

As there is no longer any procedural error in this case, we proceed to determine

whether the sentence is substantively unreasonable. “Our review of the substantive

reasonableness of a sentence for abuse of discretion is highly deferential.” United

States v. Roberts, 747 F.3d 990, 992 (8th Cir. 2014). “[I]t will be the unusual case

when we reverse a district court sentence—whether within, above, or below the

applicable Guidelines range—as substantively unreasonable.” United States v.

Feemster, 572 F.3d 455, 464 (8th Cir. 2009) (en banc) (quotation omitted). While it

is unusual for us to find a sentence substantively unreasonable, we have recently done

so. In United States v. Dautovic, we held a downward variance from a Guidelines

range of 135 to 168 months (the same Guidelines range applicable to Cole) to a 20-

month sentence to be substantively unreasonable. See Nos. 13-1493 and 13-1145,

2014 WL 3953989 (8th Cir. Aug. 14, 2014). In Dautovic, however, we noted that the

defendant police officer’s “offense conduct was egregious” and included “beat[ing]

an innocent victim with a dangerous weapon, causing serious bodily injury and

permanent physical damage;” “[writing] a false police report that caused [the victims]

to be charged with crimes;” and “committ[ing] perjury.” Id. at *7. We also noted

“[t]he district court found that Dautovic showed no remorse” for his actions. Id.

Despite these findings, “the district court tried to avoid unwarranted sentence

disparities by basing Dautovic’s sentence on the average sentence imposed for civil

-4-
rights violations.” Id., see also 18 U.S.C. § 3553(a)(6). We concluded that the district

court erred in its application of section 3553(a)(6) because Dautovic’s “offense

conduct involved aggravating circumstances” not normally found in most civil rights

violations used by the district court for comparison, and thus the downward variance

was not justified by the district court’s consideration of the section 3553(a) factors. 

Id. at *7-*8. 

While we do not minimize the seriousness of the crimes perpetrated by Cole

and the staggering nature of the fraudulent scheme in which Cole was a participant,

the district court here, unlike in Dautovic, has adequately explained the sentence and

appropriately considered the section 3553(a) factors in varying downward to a

probationary sentence, making “precisely the kind of defendant-specific

determinations that are within the special competence of sentencing courts.” 

Feemster, 572 F.3d at 464 (quotation omitted). For instance, the district court noted

that Cole’s role in the offense was mostly as a passive participant and Cole was not

the typical white collar defendant the court had observed in similar criminal schemes. 

We find no error in the weighing of the section 3553(a) factors, and thus the district

court did not abuse its substantial discretion in sentencing Cole to probation. 

Accordingly, we affirm the sentence. 

______________________________

-5-