FI LED U. S . COURT OF AP PE ALS E L E V E N T H C IR C U IT A pr i l 23, 2008 T HOM AS K. KAHN CL E RK

Honora ble Judith M. Barzil ay, Judg e, United States Court of International Trade , sitti ng * by designation. [ P UB L I S H]

I N THE UN I TE D STATE S C OU RT OF APPE ALS F O R T H E E L E V E N T H C IR C U IT

________________________ N o. 06- 11303

________________________ D. C . Do c k e tNo . 0 3 - 0 0 1 8 2 - C R - 2 - UWC - HG D U N I T E D S T A T E S O F A M E R I C A , P la in tif f - A p p e lla n t, v ersu s K E N N E T H K . L I V E S A Y , D e f e n d a n t- A p p e lle e .

________________________ A pp ea l fr om the U ni t ed S t at es D i stri ctC ou rt f o rth e N o r th e rn D i s tr i c to f A l ab a ma

_________________________ ON RE MAND F RO M T HE UN I T E D S T AT E S S UP RE ME CO UR T B ef ore H U L L and M A R C U S , C i rc ui tJudg es , and B A R Z IL A Y , Judg e. * H U L L , C i rc ui tJudg e:O ur Li v e s ay II de c i s i o nw a s th i s C o urt ’ s s e c o n d re v i ewo f

Li v e s ay ’ s s ent en c e . In 1 United States v. Livesay

(Livesay I), 146 F . App’x 403, 405 (11th Ci r. 2005), wevacated and rema nded Livesay ’s sentenc e of probation after conc luding that the record provided a “sca nt basis to assess” the reasona bleness of that sentence . On remand af ter Livesay

I , the district court ag ain sentenc ed Livesay

to probation, and weag ain reverse d, deter mining the sentenceto be unre a so na

ble . Se eLive say

II , 4 84F .3 d at 13 25 -2 6. Live sa y a pp e ale d f ro m ou r de c isi on in Livesay II , and the Supreme Court rema nded to us for this re consideration in li ght of Gall. See Livesay, __ U.S. at __, 128 S. Ct . at 872-73. 2 T hi s c a s e i s be f

or e us on r e m a nd f

r om the U ni t e d S t a t e s S upr e m e C our tf or r e c ons i de r a t i on i n l i ghtof G a l l v. U ni t e d S t a t e s , 552 U . S . __, 128 S . C t . 586 (200 7). L i vesa y v. U ni t ed S t at es , __ U . S . __ , 12 8 S . C t . 87 2, 87 2-73 (200 8). In thi s $1. 4 b i l l i on fr aud schem e, defe nd ant -app el l ee K enneth K . L i vesa y, the form er A s s is ta n t C o n tr o lle ra n d C h ie f I n f o rm a tio n O f

f ic e r( “C I O ” ) o f

H e a lth S o u th C o rp o rat i o n w h o p l ayed a m aj o r ro l e i n th e frau d , w as sen t en ced t o 6 0 m o n th s’ prob at i on , w i th the fi rs t6 m on ths t o b e s erved as hom e det ent i on . T hi s panel previ ou sl y vac at ed L i vesa y’ s non -c ust od i al se nt ence . S ee U ni t ed S t at es v. L i vesa y ( L iv e s a y I I ) , 4 8 4 F .3 d 1 3 2 4 , 1 3 2 5 - 2 6 ( 1 1 th C ir . 2 0 0 7 ) . A f te rr e c o n s id e r a tio n in 1 l i ghtof G a l l a nd a f

f or di ng s ubs t a nt i a l de f

e r e nc e t o the di s tr i c tc our t ’ s s e nt e nc i ng det erm i nat i on s, w e c on cl ud e thatthe di stri ctcourtcom m i tt ed G al l procedural e rr o r , a n d th u s w e m u s t v a c a te L iv e s a y ’s s e n te n c e a n d r e m a n d . I . F AC T UA L B AC KG RO UN D Ea r l i e rd e c i s i o n s o f

th i s Co u r to u t l i n e th e $ 1 . 4 b i l l i o n c r i mi n a l f r au d s c h e me atH ea l thS ou th. S ee U ni t ed S t at es v. M art i n, 45 5 F . 3d 12 27 , 12 30 -31 (11 th C i r.Be forethe district court, both Livesay and the g overnment withdrew all objections to the 2 P S I. 3 2 0 0 6 ) ; U n ite d S ta te s v . M c V a y , 4 4 7 F .3 d 1 3 4 8 , 1 3 4 9 - 5 0 ( 1 1 th C ir . 2 0 0 6 ) . A cc ordi ng l y, i n thi s opi ni on , w e provi de on l y abri ef ov ervi ew of thatgeneral s c h e m e . W e th e n d e ta il L iv e s a y ’s s p e c if ic r o le in th e f

r au d , a s o u tlin e d in L i vesa y’ s P re se nt ence Invest i gat i on R eport(“ P S I” ). 2 A tsom e poi nti n the ea rl y t o m i d-19 90 s, H ea l thS ou th o ff i ci al s r ea l i ze d that H ea l thS ou th’ s f

i nanci al re sul t s w er e f

ai l i ng t o p rodu ce suff

i ci entea rni ng s- pers h a r e to m e e t th e e x p e c ta tio n s o f W a ll S tr e e t a n a ly s ts . V a r io u s H e a lth S o u th of f i c i a l s , i nc l udi ng L i ve s a y , be c a m e a w a r e tha tthe e a rni ngs s hor t f a l l c r e a t e d a s ubs t a nt i a l r i s k tha t , unl e s s the e a rni ngs - pe r - s ha r e w e r e a r t i f i c i a l l y i nf

l a t e d, the e a rni ngs w oul d f

a i l t o m e e ta na l y s te xpe c t a t i ons , a nd the m a rke tpr i c e of H e a lth S o u th ’s s e c u r itie s w o u ld d e c lin e . T h e r e f o r e , f r o m a t le a s t 1 9 9 4 u n til M a r c h 2 0 0 3 , ag r o u p o f H e a lth S o u th of f i c i a l s “ c ons pi r e d t o a r t i f i c i a l l y i nf

l a t e H e a l thS outh’ s r e por t e d e a rni ngs a nd ea rni ng s pershar e, and t o fal si fyre po rt s abo utH ea l thS ou th’ s overa l l fi nanci al cond i t i on . ” M art i n, 45 5 F . 3d at12 30 . T he offi ci al s “ m ade, and d i re ct ed a c c ount i ng pe r s onne l t o m a ke , f a l s e a nd f

r audul e nte ntr i e s i n H e a l thS outh’ s books a nd r e c or ds f

orthe purpos e of

f a l s e l y r e por t i ng H e a l thS outh’ s a s s e t s , r e ve nue s , a nd e a rn in g s p e rs h a r e a n d in o r d e rto d e f r au d in v e s to r s , b a n k s , a n d le n d e r s .” I d .In late 1999, Livesay beca me the CI O of He althSouth. 3 4 F orove rt e n y e a r s f

r om A pr i l 1989 t o N ove m be r1999, L i ve s a y w a s the A s s i s t a ntC ontr ol l e ri n H e a l thS outh’ s a c c ount i ng de pa r tm e nt . A c c or di ng t o the 3 P S I , dur i ng hi s t i m e a s A s s i s t a ntC ontr ol l e r , L i ve s a y ha d a c c e s s t o a l l of the f i n a n c i a l i n f

o rm a t i o n o n He a l th S o u th ’ s b a l a n c e s h e e t s a n d i n c o m e s t a t e m e n t s . As A ss i st antC on trol l er , L i vesay di re ct l y a ss i st ed the C on trol l erand the C hi ef F in a n c ia l O f

f ic e rin p r e p a r in g th e f

in a n c ia l s ta te m e n ts a n d r e p o r ts th a t H e a lth S o u th w a s r e q u ir e d to f

ile w ith th e S e c u r itie s a n d E x c h a n g e C o m m is s io n ( “S E C ” ) . S eni or execut i ves i ss ued i nstruct i on s t o d ef endantL i vesa y r egar di ng the desi re d e a rni ngs - pe r - s ha r e , a nd A s s i s t a ntC ontr ol l e rL i ve s a y a nd H e a l thS outh’ s a c c ount i ng s ta f f m e t to d is c u s s w a y s to m e e t W a ll S tr e e t’s e a rn in g s - p e r - s h a r e e x p e c ta tio n s . M o r e s p e c if

ic a lly , L iv e s a y , a s A s s is ta n t C o n tr o lle r , m a d e f a ls e e n tr ie s in H ea l thS ou th’ s boo ks and rec ords t o art i fi ci al l y i nfl at e the com pany’ s e arni ng s- persh ar e. L iv es ay also m an ag ed an d su p er v ised o th er s in m an ip u lati n g H ea lth S o u th ’s b o o k s a n d r e c o r d s , in s tru c tin g H e a lth S o u th ’s a c c o u n tin g s ta f f to a lte rc e r ta in a c c o u n ts s o a s to in f

la te H e a lth S o u th ’s e a rn in g s - p e r - s h a r e . L iv e s a y p a r tic ip a te d in the prepara t i on of H ea l thS ou th’ s 199 8 q uart er l y a nd annu al re po rt s thatw er e f i l ed w i th the S E C , and L i vesa y f ul l y knew thatthe re po rt s m at er i al l y m i ss t at ed H e a l thS outh’ s ne ti nc om e , r e ve nue , e a rni ngs - pe r - s ha r e , a s s e t s , a nd l i abi l i t i e s . F or5

e x a m p le , H e a lth S o u th ’s p r e - ta x in c o m e w a s o v e r s ta te d b y ap p r o x im a te ly $ 4 4 0 ,0 0 0 ,0 0 0 in 1 9 9 7 a n d $ 6 3 5 ,0 0 0 ,0 0 0 in 1 9 9 8 . T hi s m a s s i ve f

r aud, i n w hi c h L i ve s a y di r e c t l y pa r t i c i pa t e d f orove rf i ve y e a r s , i m pa c t e d m a ny vi c t i m s . A f t e rthe c ons pi r a c y w a s unc ove r e d i n M a r c h 2003 a n d th e S E C te m p o r a r ily s u s p e n d e d tr a d in g in H e a lth S o u th s to c k , th e to ta l d r o p in the va l ue of

out s t a ndi ng H e a l thS outh s t oc k w a s appr oxi m a t e l y $1. 4 bi l l i on. M a ny shar ehol ders had i nv es t ed thei r l i fe sa vi ng s i n H ea l thS ou th st ock, w hi ch pl um m e t e d t o pe nni e s pe rs ha r e . T hi s f r aud a l s o a f

f e c t e d m a ny othe r s , i nc l udi ng: ( 1 ) H e a lth S o u th e m p lo y e e s , m a n y o f w h o m w e r e lo n g - tim e e m p lo y e e s c lo s e to re t i re m ent , w ho suff

er ed by ei ther l osi ng thei r j ob or thei r r et i re m entsa vi ng s that w a s i nve s t e d i n the c om pa ny ’ s s t oc k ow ne r s hi p pl a n orpe ns i on f und; ( 2) e m pl oy e e s of

c ontr a c t or s w ho w e r e de pe nde nton H e a l thS outh c ontr a c t s f or i nc om e ; ( 3) ba nks a nd othe rl e nde r s w ho l oa ne d m one y t o H e a l thS outh ba s e d on f a l s e f i na nc i a l i nf

orm a t i on; ( 4) he a l th- s e rvi c e c om pe t i t or s w ho l os tbus i ne s s or f i na nc i ng due t o H e a l thS outh’ s f a l s e f i na nc i a l r e pr e s e nt a t i ons ; a nd ( 5) m e m be r s of th e co m m u n i ty w h o b en efi t ed fro m H eal th S o u th ’ s ch ari t ab l e act i v i t i es. I I . P RO CE DU RA L HI S T OR Y A . G u i l t y P l e a an d A d vi s or y G u i d e l i n e s R an ge L iv e s a y p le d g u ilty to a n in f o rm a tio n c h a r g in g h im w ith : ( 1 ) c o n s p ir a c y toThe pa rties stipulated that the appropriate version of the Guide lines was the November 4 19 98 e dition ; ac c ording ly, all Guide lin e s c itatio nsareto t heNo vember 1 99 8 e dition unle ss otherwise note d. 6 com m i tw i re and sec uri t i es fr aud, i n v i ol at i on of 15 U . S . C . §§ 78 m (a ), (b)( 2)(A )- ( B ) a nd ( b) ( 5) , a nd 78f f a nd 18 U . S . C . §§ 371 a nd 1343, e ta l . ( C ountO ne ) ; a nd ( 2) f a l s i f i c a t i on of

f i na nc i a l i nf

orm a t i on, i n vi ol a t i on of 15 U . S . C . §§ 78m ( b) ( 2) ( A ) , 78m ( b) ( 5) , 78f f , a nd 18 U . S . C . § 2 ( C ountT w o) . T he i nf orm a t i on a ls o in c lu d e d af

o r f e itu r e c o u n t. T h e P S I s e t L iv e s a y ’s b a s e o f f e n s e le v e l a t 6 , p u r s u a n t to U .S .S .G . § 2F 1. 1( a ) . L i ve s a y ’ s a dj us t e d of f e ns e l e ve l w a s 28, how e ve r , due t o f our 4 e n h a n c e m e n ts r e f

le c tin g th e m a g n itu d e o f th e f r au d a n d h is s ig n if

ic a n t r o le in it. T he enhancem ent s w er e: (1) 18 l evel s, pu rs uantt o U . S . S . G . § 2 F 1. 1(b)(1)(S), b e c a u s e th e lo s s a m o u n t e x c e e d e d $ 8 0 m illio n ; ( 2 ) 2 le v e ls , p u r s u a n t to U .S .S .G . § 2F 1. 1(b)(2)(A ), because the offens e i nv ol ved m ore than m i ni m al pl anni ng ; (3) 2 l evel s, pu rs uantt o U . S . S . G . § 2 F 1. 1(b)(5)(C), because the offens e i nv ol ved s ophi s t i c a t e d m e a ns ; a nd ( 4) 3 l e ve l s , pur s ua ntt o U . S . S . G . § 3B 1. 1( b) , f or L i ve s a y ’ s r ol e i n the of

f e ns e a s am a na ge rors upe rvi s or . A f t e ra3- l e ve l r e duc t i on fo r accep t an ce o f resp o n si b i l i ty u n d er U . S . S . G . § 3 E 1 . 1 , L i v esay’ s ad j u st ed o ffen se l evel w as 28 . W i th an o ff ense l evel of 28 and a cri m i nal hi st ory c at egory of I , L iv e s a y ’s a d v is o ry G u id e lin e s r a n g e w a s 7 8 to 9 7 m o n th s ’ im p r is o n m e n t.7

T he go vernm entfi l ed a U . S . S . G . § 5 K 1. 1 m ot i on for dow nw ar d d eparture, base d o n L i vesa y’ s c oo pera t i on and sub st ant i al as si st ance . T he go vernm entno t ed tha tL i ve s a y : ( 1) m e tw he ne ve rne e de d w i th s e ve r a l gove rnm e nta ge nc i e s , e a c h of w hi c h ha d as ubs t a nt i a l ne e d f orhi s a s s i s t a nc e ; ( 2) m e tw i th the f or e ns i c a udi t or r e c ons truc t i ng H e a l thS outh’ s books a nd r e c or ds ; ( 3) s pe ntm a ny hour s r e vi e w i ng f in a n c ia l s ta te m e n ts a n d o th e rd o c u m e n ts ; ( 4 ) p r o v id e d th e g o v e rn m e n t w ith c r i t i c a l doc um e nt s e vi de nc i ng the f r aud; ( 5) he l pe d qua nt i f y the f r aud; a nd ( 6) fa ci l i t at ed gu i l ty pl ea s f rom other c o-conspi ra t ors a nd the prosecut i on of others ye t to b e c o n v ic te d . B . F i r s t S e n t e n c i n g i n Ju n e 2004 A tL i ve s a y ’ s f

i r s ts e nt e nc i ng, the gove rnm e nt ’ s § 5K 1. 1 m ot i on r e c om m e nde d adow nw a r d de pa r tur e of 3 l e ve l s ( f

r om 28 t o 25) a nd as e nt e nc e of 6 0 m o n th s ’ im p r is o n m e n t. T h e d is tr ic t c o u r t g r a n te d th e g o v e rn m e n t’s § 5 K 1 .1 m ot i on, butde pa r t e d dow nw a r d 18 l e ve l s , t o a n of f e ns e l e ve l of

10. L i ve s a y I , 146 F . A pp ’ x at40 4. O ff

ense l evel 10 , com bi ned w i th L i vesa y’ s c ri m i nal hi st ory cat eg o ry o f I, yi el d ed an ad v i so ry G u i d el i n es ran g e o f 6 t o 1 2 m o n th s’ i m p ri so n m en t . B ecau se L i v esay’ s G u i d el i n es ran g e o f 6 t o 1 2 m o n th s’ i m pr i s onm e ntf

e l l w i thi n “ Z one B ” of

the s e nt e nc i ng t abl e , the G ui de l i ne s ga ve the d i s tr i c tc o u r tth e o p t i o n o f s e n t e n c i n g Li v e s a y t o p r o b a t i o n a n d 6 mo n th s ’ h o meAf ter depa rtingdo wnwa

rd to a n o ff ens eleve l of

10 , th edis tric t c ourt

wa s a bleto 5 sentenc e Livesay

to 60 months’ probation and 6 months’ home detention without any additional Guidelines depa

rtures be causeU.S.S.G. §§ 5B1.1(a)(2) and 5C1.1(c) (3) permit a sentenc e of probation, subject to certain conditions inapplicable here, if a defendant’s applica

ble advisory Guidelines ra

ng e is within “Z one B ” of thesentenc ing ta ble. B eca use Livesay ’s offense leve l was 10 a nd criminal history

cate g ory was I , Livesay

fell within Z one B on the sentenc ing ta ble. Thus , b y imp os ing6 mo nth s’ ho medetenti on , th edis tric t c ourt wa s a bleto s entenc eLive sa

y to 60 months’ probation. See U.S.S.G. §§ 5B1.1( a)( 2), 5C1.1(c) (3). 8 de t e nt i on w i thouta ny a ddi t i ona l G ui de l i ne s de pa r tur e s . S e e U . S . S . G . §§ 5 B 1 .1 ( a ) ( 2 ) , 5 C 1 .1 ( c ) ( 3 ) ( p e rm ittin g as e n te n c e o f p r o b a tio n , s u b

je c t to c e r ta in c ondi t i ons i nappl i c abl e he r e , i f ade f e nda nt ’ s appl i c abl e a dvi s ory G ui de l i ne s r a nge i s w i thi n “ Z one B ” ) . T he gove rnm e ntobj e c t e d t o the r e a s onabl e ne s s of the § 5 K 1 .1 d e p a r tu r e . A l t e rna t i ve l y , the gove rnm e nta s ke d tha tL i ve s a y a tl e a s tbe s e nt e nc e d t o the m axi m um se nt ence i n thatra ng e ( 12 m on ths’ i m pri sonm ent ). T he di stri ctcourt n e v e r th e le s s s e n te n c e d L iv e s a y to 6 0 m o n th s ’ p r o b a tio n , w ith th e f ir s t 6 m o n th s to be s e rve d on hom e de t e nt i on, pur s ua ntt o U . S . S . G . §§ 5B 1. 1( a ) ( 2) a nd 5 C 1 .1 ( c ) ( 3 ) . T h e d is tr ic t c o u r t im p o s e d a$ 1 0 ,0 0 0 f in e a n d f o r f e itu r e o f $ 7 5 0 ,0 0 0 . 5 T he go vernm entappeal ed, w hi ch re sul t ed i n o ur L i vesa y I deci si on . In L iv e s a y I , th is C o u r t v a c a te d L iv e s a y ’s s e n te n c e a n d r e m a n d e d L iv e s a y ’s c a s e to the di stri ctcourtfor r es ent enci ng . L i vesa y I , 14 6 F . A pp ’ x at40 5. T hi s C ou rt concl ud ed thatthe se nt enci ng court“ fa i l ed ent i re l y t o add re ss spec i fi ca l l y the § 5K 1. 1 fac t ors or otherw i se t o st at e r ea sons supp ort i ng the ext entof i t s departure. ”9

I d. T hi s C our tf

ur the rc onc l ude d tha t“ [ w ] e do nots a y tha te ve ry § 5K 1. 1 f a c t or m u s t b e s e p a r a te ly a d d r e s s e d in th e o r d e ro f ju d g m e n t a n d c o n v ic tio n ; w e s a y o n ly thatthi s r ec ord fai l s t o p rovi de the m i ni m um i nd i ci a r equi re d t o al l ow us t o revi ew f o rr e a s o n ab le n e s s .” I d . C . R e s e n t e n c i n g i n D e c e m b e r 2005 T h i s c u rr e n tap p e a l i s f

r o m th e r e s e n t e n c i n g i n De c e m b e r2 0 0 5 . As d is c u s s e d la te r , th e d is tr ic t c o u r t ju d g e a d d e d v e ry little to th e r e c o r d in th is r e s e n t e n c i n g a n d b a s i c a l l y ma d e i tc l e a rh e w a s s i mp l y r e i mp o s i n g th e s a me s e nt e nc e on r e m a nd. W e out l i ne w ha tthe br i e f s e ve nt e e n- pa ge r e s e nt e nc i ng tran scri p tsh o w s. T h is b rief

tran sc rip t sh o w s th at th e d istrict co u rt ac tu ally b eg an L iv es ay ’s re se nt enci ng hear i ng w i th “ prel i m i naryre m arks, ” i n w hi ch the di stri ctcourt c om m e nt e d tha t“ [ l ] urki ng nott oo f a ri n the ba c kgr ound of

thi s s e nt e nc i ng i s the j ury’ s ver di cti n the R i char d S crushy ca se . ” R i char d S crushy w as the C hi ef E xe c ut i ve O f

f i c e rof H e a l thS outh a ta l l t i m e s pe r t i ne nt , a nd he w a s a c qui tt e d by the j ury i n h i s tri al . T he di stri ctcourt , spea ki ng “ no tas on e of tw el ve A rt i cl e I II ju d g e s o f

th e c o u r t, b u t a s th e C h ie f J u d g e o f th e N o r th e rn D is tr ic t o f A lab a m a ,” ob se rved thathe kn ew of no al l egat i on s thatthe j ury i n the S crushy ca se had b ee n i n a nyw a y c om pr om i s e d. T he di s tr i c tc our tpubl i c l y tha nke d the S c rus hy j ury f orTh eg ov ernment did not m akea sp e c if icre c omm endatio n a s toho w m any leve ls 6 downward the district court should depa rt within the advisory

Guidelines ra

ng e. Between Livesay ’s first sentenc ing a nd resentencing , Livesay

testified for the 7 g overnment at Scrushy ’s trial. Livesay also testified for

the g overnment at the trial of Sonny Cr ump ler a nd aide d th eg ov ernment in p repa ringfo r b oth

Sc ru shy ’sand

Cr ump ler’ s trials. 10 it s “trem en d o u s p u b li c s er v ice,” a n d o b se rv ed th at b ef o re attack in g th e ju ry ’s ve r di c t , “ i ti s i m por t a ntt o r e f l e c ton the f

a c ttha tw e di d nots i the r e i n the courtroom and h ea r a nd consi der a l l of the evi dence, as the j urors di d. ” T he di stri ctcourtthen n ot ed that , i n L i vesa y’ s c as e, thi s C ou rthad d i re ct ed the di s tr i c tc our tt o out l i ne i n s om e de t a i l the f a c t or s on w hi c h i tr e l i e d i n gi vi ng the § 5K 1. 1 de pa r tur e a nd i t s r e a s ons f orthe e xt e ntof

the de pa r tur e . T he go vernm entre new ed i t s § 5K 1. 1 m ot i on , bu ti n l i gh tof L i vesa y’ s c on t i nu ed su b st an t i al assi st an ce si n ce th e fi rstsen t en ci n g , reco m m en d ed 2 0 m o n th s’ i m pri sonm ent (i . e. , l es s than i t s r ec om m endat i on for 60 m on ths’ i m pri sonm entat

6 the fi rs tse nt enci ng ). 7 T h e d is tr ic t c o u r t a g a in g r a n te d th e g o v e rn m e n t’s § 5 K 1 .1 m o tio n a n d s a id it w a s “ ba s i c a l l y r e i m pos i ng the or i gi na l s e nt e nc e . ” T he di s tr i c tc our tdi d m a ke sp ec ific § 5 K 1 .1 fin d in g s th at th e s ig n ifican ce an d tru th fu ln es s o f L iv es ay ’s i nform at i on and t es t i m on y, as w el l as the nature a nd ext entof hi s a ss i st ance , w as

“ extra ordi nari l y hi gh ” a nd w arra nt ed an “ extra ordi narydeparture. ” T he di stri ct courtfurther f

ou nd thatL i vesa y’ s a ss i st ance w as “ veryt i m el y” and w arra nt ed11

“ex trao rd in ar y c o n sid er atio n .” T h e d istrict co u rt ac k n o w led g ed th at L iv es ay ’s

“ a c t i o n s w e r e n o ts u f

f i c i e n tt o me e tth e l e g a l s t a n d a r d s f o rw i th d r a w i n g f

r o m a c ons pi r a c y , ” butne ve r the l e s s s t a t e d tha ti tw a s “ i m pr e s s e d w i th the f a c ttha tf r om ju s t a n o r d in a ry , c o m m o n s e n s e u n d e r s ta n d in g , [ L iv e s a y ] d id s u b s ta n tia lly w i thd ra w fr om the conspi ra cy . ” T he di stri ctcourtthen repeat ed the sa m e e ar l i er§ 5 K 1. 1 d ow nw ar d departure a nd depart ed do w nw ar d 1 8 l evel s t o an o ff ense l evel of 10 , w hi ch on ce ag ai n l eftL i v esay w i th an ad v i so ry G u i d el i n es ran g e o f 6 t o 1 2 m o n th s’ im p r is o n m e n t. A tthatpo i nt , the go vernm entas ked t o b e hea rd before the di stri ctcourt i m po se d i t s f

i nal se nt ence . W hi l e the go vernm entac kn ow l edged thatL i vesa y w as

“ w el l dese rvi ng of a dow nw ar d d eparture, ” the go vernm entstre ss ed thatL i vesa y al so “ w as a keypl ay er , a s i gn i fi ca ntcog, i n the op er at i on of thi s f raud at H e a l thS outh f

oranum be rof

y e a r s . ” T he gove rnm e nte m pha s i z e d tha ta l though L i ve s a y “ di d c om e f

orw a r d e a r l y , ” he ne ve r the l e s s “ di dn’ tc om e f orw a r d unt i l the fr au d it se lf w as re v ea led .” T h e g o v er n m en t fu rth ero b se rv ed th at L iv es ay ’s

“ ha ndi w ork a s one of

the m e c ha ni c s ” of

the f r aud w a s r e f

l e c t e d i n the f

r audul e nt f orm s tha tH e a l thS outh f i l e d w i th the S E C . T he gove rnm e nts tr e s s e d the “ ne e d f or det erre nce” i n sent enci ng L i vesa y, and st at ed i t s bel i ef thatsom e pri son “ se nt enceSee United States v. B ooker, 543 U .S. 220, 125 S. C t. 738 (2005). 8 12 o f s i g n i f i c a n c e ” w a s n e c e s s a ry i n l i g h to f th e s e n t e n c i n g f

a c t o r s f o u n d i n 1 8 U . S. C. § 3 5 5 3 (a). T h e g o v ern m en tren ew ed i t s req u estfo r a sen t en ce o f 1 2 m o n th s’ im p r is o n m e n t u n d e rth e a d ju s te d G u id e lin e s r a n g e f o u n d b y th e d is tr ic t c o u r t. T he di s tr i c tc our tthe n s um m a r i l y s t a t e d, “ I f I ’ m w r ong on the e xt e ntof the d e p a r tu r e w h ic h I h a v e ju s t m a d e , I b e lie v e th a t th e s e n te n c e I ’m ab o u t to im p o s e is the m ostapprop ri at e s ent ence i n thi s c as e i n con si dera t i on of the B oo ker c as e. ” In 8 othe rw or ds , e ve n w i thoutthe § 5K 1. 1 de pa rtur e , the di s tr i c tc our tw oul d ha ve m a d e th e s a m e v a r ia n c e u n d e rU n ite d S ta te s v . B o o k e r , 5 4 3 U .S . 2 2 0 , 1 2 5 S . C t. 73 8 (20 05 ), f

r o m th e a d v is o ry G u id e lin e s r a n g e o f 7 8 to 9 7 m o n th s ’ im p r is o n m e n t. T h e d i stri ctco u rtp ro ceed ed t o sen t en ce L i v esay t o 6 0 m o n th s’ p ro b at i o n (th e fi rst 6 m onths t o be s e rve d on hom e de t e nt i on, w hi c h L i ve s a y a l r e a dy ha d done ) . T he di stri ctcourtre i m po se d the $1 0, 00 0 fi ne and forfei ture of $75 0, 00 0, bo th o f w hi ch L i ve s a y ha d a l r e a dy pa i d. W i th regard t o the se nt enci ng fa ct ors i n § 35 53 (a ), the di stri ctcourtst at ed tha ti tvi e w e d the s e nt e nc e a s “ appr opr i a t e ” ba s e d on the “ na tur e a nd ci rc um st ance s” of L i vesa y’ s c ri m es ; L i vesa y’ s “ hi st ory a nd pers on al char ac t er i st i cs ”; the “ need for thi s s ent ence t o ref l ec tthe se ri ou snes s” of the cr i m es to w h ic h L iv e s a y p le d g u ilty ; th e n e e d to “p r o m o te r e s p e c t f o rth e la w , a n d to13

prov i de j ustpu ni shm ent ”; “ and t o aff ord adequ at e det erre nce. ” T he di stri ctcourt f u r th e rs ta te d th a t it c o n s id e r e d th e s e n te n c e “ju s tif ie d in o r d e rto a v o id unw a rr a nt e d s e nt e nc i ng di s pa r i t i e s a m ong de f e nda nt s w i th s i m i l a rr e c or ds w ho ha ve be e n f

ound gui l ty of

s i m i l a rc onduc t , ” a nd l i s t e d the s e nt e nc e s i m pos e d on tw e lv e o th e rH e a lth S o u th c o - c o n s p ir a to r s a s f o llo w s : In th e ca ses a ri si ng ou tof thi s c on du ct , W es t on S m i th rec ei ved 27 mo n t h s [ i mp r i s o n me n t ] ; W i l l i a m O w e ns , 27 m ont hs [ im p r is o n m e n t]; E m e ry H a rr is , f iv e m o n th s [ im p r is o n m e n t]; A n g e la A y e r s , 48 m onths of pr oba t i on; C a thy E dw a r ds , 48 m onths of p r o b a tio n ; R e b e c c aM o r g a n , 4 8 m o n th s o f p r o b a tio n ; V ir g in ia V al en t i n e, 4 8 m o n th s o f p ro b at i o n ; M i ch ael M art i n , sev en d ays [i m pri sonm ent ] ; A ar on B ea m , three m on ths [i m pri sonm ent ] ; R i char d B ott s , 60 m onths of

pr oba t i on; W i l l H i c ks , 24 m onths of pr ob at i o n; a nd C a the r i ne F ow l e r , 24 m onths of pr oba t i on. L i ve s a y ’ s c ouns e l the n poi nt e d outtha tW i l l i a m O w e ns ’ s s e nt e nc e w a s actu al l y 60 m o n th s ’ im p r is o n m e n t, n o t 2 7 m o n th s . T h e d is tr ic t c o u r t s a id , “I s ta n d c o rr e c te d .” T he di s tr i c tc our tdi d notdi s c us s the na tur e of the co n d uc tof

the s e tw e l ve othe rc oc o n s p ir a to r s o re x p la in h o w th e irc o n d u c t w a s s im ilarto L iv e s a y ’s . T hi s appe a l f

ol l ow e d. I I I . DI S CUS S I ON A . D i s t r i c t C o ur t ’ s Po s t - G a l lD ut i e s a t Se nt e nc i ng A f te rth e S u p r e m e C o u r t’s d e c is io n s in B o o k e ra n d G a ll, th e d is tr ic t c o u r ts ar e s t i l l re qu i re d t o correc t l y c al cul at e the advi soryG ui del i nes r ange. S ee U ni t ed14

S t at es v. P ug h, 51 5 F . 3d 11 79 , 11 89 (11th C i r. 20 08 ); se e a l so M art i n, 45 5 F . 3d at 12 35 ; U ni t ed S t at es v. C ra w ford, 40 7 F . 3d 11 74 , 11 78 (11th C i r. 20 05 ). “ ‘ [A ] ft er gi vi ng bo th p art i es an op po rtun i ty t o argue for w hat everse nt ence they dee m ap p r o p r ia te , th e d is tr ic t ju d g e s h o u ld th e n c o n s id e ra ll o f th e § 3 5 5 3 ( a ) f

a c to r s to de t e rm i ne w he the rthe y s uppor tthe s e nt e nc e r e que s t e d by apa r ty . ’ ” P ugh, 515 F . 3 d at1 1 8 9 -9 0 (q u o t i n g G al l , 5 5 2 U . S . at__ , 1 2 8 S . C t . at5 9 6 ). G al l al so i ns truc t s tha tthe di s tr i c tc our t“ ‘ m us tm a ke a n i ndi vi dua l i z e d a s s e s s m e ntba s e d on th e f a c ts p r e s e n te d .’” I d . a t 1 1 9 0 ( q u o tin g G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t 5 9 7 ) . I f th e d is tr ic t c o u r t d e c id e s th a t as e n te n c e o u ts id e o f th e G u id e lin e s is w a rr a n te d , it “‘m u s t c o n s id e rth e e x te n t o f th e d e v ia tio n a n d e n s u r e th a t th e ju s tif ic a tio n is s u f f ic ie n tly c o m p e llin g to s u p p o r t th e d e g r e e o f th e v a r ia n c e .’” I d . ( q u o tin g G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t 5 9 7 ) ( e m p h a s is o m itte d ) . I n a d d itio n , G a ll a d m o n is h e s th a t th e d is tr ic t c o u r t “m u s t a d e q u a te ly e x p la in the c hos e n s e nt e nc e t o a l l ow f orm e a ni ngf

ul appe l l a t e r e vi e w a nd t o pr om ot e the pe r c e pt i on of

f a i rs e nt e nc i ng. ” G a l l , 552 U . S . a t__, 128 S . C t . a t597; s e e a l s o 18 U .S .C . § 3 5 5 3 ( c ) ( s ta tin g th a t ad is tr ic t c o u r t “a t th e tim e o f s e n te n c in g , s h a ll s ta te i n ope n c our tthe r e a s ons f ori t s i m pos i t i on of

the pa r t i c ul a rs e nt e nc e ” ) ; R i t av. U ni t e d S t a t e s , 551 U . S . __, __, 127 S . C t . 2456, 2468 ( 2007) ( di s c us s i ng § 35 53 (c )) . T he S up re m e C ou rti n R i t a r ec og ni ze d thatthe re qu i re m entthata di stri ct15

courtexpl ai n the re as on s f or i t s c ho se n sent ence “ re fl ec t s s ou nd j ud i ci al prac t i ce ” be c a us e “ [ c ] onf

i de nc e i n aj udge ’ s us e of r e a s on unde r l i e s the publ i c ’ s trus ti n the j udi c i a l i ns t i tut i on” a nd as t a t e m e ntof the j udge ’ s r e a s oni ng “ he l ps pr ovi de the pu bl i c w i th the as sura nce thatcr ea t es thattrust . ” R i t a, 55 1 U . S . at__ , 12 7 S . C t . at 2 4 6 8 . T he l e ngth a nd a m ountof de t a i l of the j udge ’ s r e a s oni ng r e qui r e d de pe nds o n th e c ir c u m s ta n c e s . I d . A s ta te m e n t o f r e a s o n s f

o rac r im in a l s e n te n c e is pa r t i c ul a r l y i m por t a nt . I d. W hi l e as e nt e nc i ng j udge i s notr e qui r e d t o s t a t e on the reco rd th ati th as ex p l i ci t l y co n si d ered each o f th e § 3 5 5 3 (a) factors o r t o d i scu ss e a c h o f th e § 3 5 5 3 ( a ) f

a c to r s , U n ite d S ta te s v . S c o tt, 4 2 6 F .3 d 1 3 2 4 , 1 3 2 9 ( 1 1 th C ir . 2 0 0 5 ) , “‘[ t]h e s e n te n c in g ju d g e s h o u ld s e t f o r th e n o u g h to s a tis f

y th e ap p e lla te c our ttha the ha s c ons i de r e d the pa r t i e s ’ a r gum e nt s a nd ha s ar e a s one d ba s i s f or e xe r c i s i ng hi s ow n l e ga l de c i s i onm a ki ng author i ty , ’ ” U ni t e d S t a t e s v. A gba i , 497 F .3 d 1 2 2 6 , 1 2 3 0 ( 1 1 th C ir . 2 0 0 7 ) ( q u o tin g R ita , 5 5 1 U .S . a t _

_ , 1 2 7 S . C t. a t 2 4 6 8 ) . G e ne r a l l y , w he n s e nt e nc i ng w i thi n the a dvi s ory G ui de l i ne s r a nge , the di s tr i c tc our ti s notr e qui r e d t o gi ve al e ngthy e xpl a na t i on f ori t s s e nt e nc e i f

the c a s e i s typi c a l of

thos e c ont e m pl a t e d by the S e nt e nc i ng C om m i s s i on. S e e i d. ( c i t i ng R i t a , 551 U . S . a t__, 127 S . C t . a t2468) . H ow e ve r , i f apa r ty r e que s t e d a s e nt e nc e out s i de of

the G ui de l i ne s r a nge , the di s tr i c tc our t“ w i l l norm a l l y go16

f ur the ra nd e xpl a i n w hy he ha s r e j e c t e d thos e a r gum e nt s . ” R i t a , 551 U . S . a t__, 1 2 7 S . C t . at2 4 6 8 . F u rth er, R i t a ex p l ai n ed th at“ [w ] h ere th e j u d g e i m p o ses a s e n te n c e o u ts id e th e G u id e lin e s , th e ju d g e w ill e x p la in w h y h e h a s d o n e s o .” I d . a t

__, 127 S . C t . a t2468. S ubs e que ntt o R i t aa nd G a l l , thi s C our te xpl a i ne d i n P ugh tha t“ adi s tr i c tc our tne e d notdi s c us s e a c h S e c t i on 3553( a ) f a c t or , a l though ‘[ w ]h e r e th e ju d g e im p o s e s as e n te n c e o u ts id e th e G u id e lin e s , th e ju d g e w ill e x p l a i n w h y h e h a s d o n e s o . ’ ” Pu g h , 5 1 5 F. 3 d a t1 1 9 1 n . 8 ( q u o t i n g Ri t a , 5 5 1 U . S. a t _

_ , 1 2 7 S . C t. a t 2 4 6 8 ) ( a lte r a tio n s in o r ig in a l) . B . A p p el l ate R evi ew W ith r e g a r d to ap p e lla te r e v ie w o f s e n te n c e s , th e S u p r e m e C o u r t in G a ll em ph as i ze d that“ ‘ w hi l e the ext entof the di ff er ence betw ee n a part i cul arse nt ence an d th e reco m m en d ed G u i d el i n es ran g e i s su rel y rel ev an t , co u rt s o f ap p eal s m u st r e vi e w a l l s e nt e nc e s — w he the ri ns i de , j us tout s i de , ors i gni f i c a nt l y out s i de the G ui de l i ne s r a nge — unde rade f e r e nt i a l abus e - of

- di s c r e t i on s t a nda r d. ’ ” I d. a t1189 (quo t i ng G al l , 55 2 U . S . at__ , 12 8 S . C t . at59 1). T hu s, the S up re m e C ou rtre j ec t ed

“ ‘ an appel l at e rul e thatre qu i re s “ extra ordi nary ” c i rc um st ance s t o j ust i fya s ent ence ou t si de the G ui del i nes r ange’ ” a nd al so re j ec t ed “ ‘ the use of ari gi d m athem at i ca l f orm ul atha tus e s the pe r c e nt a ge of ade pa r tur e a s the s t a nda r d f orde t e rm i ni ng the s tr e ngth of

the j us t i f

i c a t i ons r e qui r e d f

oras pe c i f

i c s e nt e nc e . ’ ” I d. a t1190 ( quot i ng17

G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t 5 9 5 ) . I ns t e a d, unde rG a l l , w e m us te nga ge i n atw o- s t e p pr oc e s s of s e nt e nc i ng r e vi e w . S e e i d. F i r s t , w e m us t“ ‘ e ns ur e tha tthe di s tr i c tc our tc om m i tt e d no s i gni f i c a ntpr oc e dur a l e rr or , s uc h a s f a i l i ng t o c a l c ul a t e ( ori m pr ope r l y c a l c ul a t i ng) the G ui de l i ne s r a nge , tr e a t i ng the G ui de l i ne s a s m a nda t ory , f a i l i ng t o c ons i de rthe § 3553( a ) f

a c t or s , s e l e c t i ng as e nt e nc e ba s e d on c l e a r l y e rr one ous f a c t s , orf a i l i ng t o a de qua t e l y e xpl a i n the c hos e n s e nt e nc e –i nc l udi ng a n e xpl a na t i on f ora ny d e v ia tio n f

r o m th e G u id e lin e s r a n g e .’” I d . ( q u o tin g G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t597) ( e m pha s i s a dde d) . S e c ond, w e m us tc ons i de rthe “ ‘ s ubs t a nt i ve re as o n ab len es s o f th e s en ten ce im p o se d , u n d eran ab u se -o f- d iscr etio n stan d ar d ,’ ” t a ki ng i nt o a c c ountthe “ ‘ t ot a l i ty of the c i r c um s t a nc e s . ’ ” I d. ( quot i ng G a l l , 552 U . S . a t__, 128 S . C t . a t597) . I n c ons i de r i ng the s ubs t a nt i ve r e a s onabl e ne s s of the se nt ence , w e m ay“ ‘ no tappl y apres um pt i on of un re as on abl enes s’ ” w here a s e n te n c e is o u ts id e o f

th e G u id e lin e s r a n g e , a n d w e “‘m u s t g iv e d u e d e f e r e n c e to the di s tr i c tc our t ’ s de c i s i on tha tthe § 3553( a ) f a c t or s , on aw hol e , j us t i f y the e xt e nt o f th e v a r ia n c e .’” I d . ( q u o tin g G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t 5 9 7 ) . “G a ll re m i nd s us once a gai n . . . t o app re ci at e the i nst i tut i on al advant age thatdi stri ct court s have i n app l yi ng and w ei gh i ng the S ec t i on 35 53 (a ) f ac t ors i n i nd i vi du al c a s e s . ” P ugh, 515 F . 3d a t1190- 91; s e e a l s o G a l l , 552 U . S . a t__, 128 S . C t . a t597-18

98. H o w ev er , G all m ak es clea r th at “i t also re m ain s tru e th at th e d istrict co u rt’s choi ce of se nt ence i s notun fe tt er ed. ” P ug h, 51 5 F . 3d at11 91 . T he S up re m e C ou rt in G a ll e m p h a s iz e d th a t ap p e lla te c o u r ts m a y “‘ta k e th e d e g r e e o f v a r ia n c e in to a c c ounta nd c ons i de rthe e xt e ntof ade vi a t i on f

r om the G ui de l i ne s . ’ ” I d. a t1190 ( q u o tin g G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t 5 9 5 ) . M o r e o v e r , th e d is tr ic t c o u r t is o b lig e d to c o n s id e ra ll o f th e § 3 5 5 3 ( a ) f

a c to r s , a n d th o s e “‘f

a c to r s in tu rn . . . gu i de appel l at e c ou rt s, as they have i n the past , i n d et erm i ni ng w hether ase nt ence is u n r e a s o n ab le .’” I d . a t 1 1 9 1 ( q u o tin g B o o k e r , 5 4 3 U .S . a t 2 6 1 , 1 2 5 S . C t. a t 7 6 6 ) . A ddi t i ona l l y , appe l l a t e c our t s “ ‘ w i l l , of c our s e , t a ke i nt o a c c ountthe t ot a l i ty of the ci rc um st ance s, i ncl ud i ng the ext entof any var i ance fr om the G ui del i nes r ange. ’ ” Id . at 1 1 9 0 (q u o ti n g G all, 5 5 2 U .S . at _

_ , 1 2 8 S . C t. at 5 9 7 ). In su m m ar y, G all’ s “d ir e c tiv e s le a v e n o d o u b t th a t a n ap p e lla te c o u r t m a y s till o v e r tu rn as u b s ta n tiv e ly unr e a s onabl e s e nt e nc e , a l be i tonl y a f t e re xa m i ni ng i tthr ough the pr i s m of abus e of d is c r e tio n , a n d th a t ap p e lla te r e v ie w h a s n o t b e e n e x tin g u is h e d .” I d . a t 1 1 9 1 . A ppl y i ng the s e pr i nc i pl e s , w e r e vi e w L i ve s a y ’ s s e nt e nc e a ga i n. C . T h e S ec ti on 5K 1. 1 D ep artu re Itre m ai ns true thataf

t erthe go vernm enthas m ade am ot i on for dow nw ar d departure pursuantt o U . S . S . G . § 5 K 1. 1, the go vernm enthas no con trol ov er19

w hether a nd t o w hatext entthe di stri ctcourtw i l l departfr om the G ui del i nes. S ee M ar ti n , 4 5 5 F .3 d at 1 2 3 5 ; M cV ay , 4 4 7 F .3 dat 1 3 5 3 . T h e d istrict co u rt’s dow nw a r d de pa r tur e ne e d onl y be r e a s onabl e . S e e M a r t i n, 455 F . 3d a t1235; M cV ay , 44 7 F . 3d at13 53 . A nd af t erG al l , of course , w e m ustre vi ew the di stri ct c o u r t’s § 5 K 1 .1 d e p a r tu r e u n d e rad e f e r e n tia l ab u s e - o f

- d is c r e tio n s ta n d a r d . S ee G al l , 55 2 U . S . at__ , 12 8 S . C t . at59 7 (“ [R ] egar dl es s of w hether the se nt ence i m po se d i s i nsi de or ou t si de the G ui del i nes r ange, the appel l at e c ou rtm ustre vi ew the se nt ence un der a n abu se -of- di sc re t i on st andard. ”) ; se e a l so M art i n, 45 5 F . 3d at 12 36 (s t at i ng thati f adi stri ctcourtdepart s und er§ 5 K 1. 1, w e r evi ew thatdeparture f o ra n ab u s e o f

d is c r e tio n ) . A pp l yi ng G al l and aff

ordi ng subst ant i al defe re nce t o the di stri ctcourthere , w e a r e o n c e a g a in c o n s tr a in e d to c o n c lu d e th a t th e d is tr ic t c o u r t le g a lly e rr e d in its § 5 K 1. 1 d ow nw ar d d eparture. M ore s peci fi ca l l y, the di stri ctcourtcom m i tt ed pron g o ne, or “ procedural , ” G al l error i n i t s § 5K 1. 1 d eparture, because the di stri ct c o u r t b a s e d th e e x te n t o f its § 5 K 1 .1 d e p a r tu r e o n a n im p e rm is s ib le c o n s id e r a tio n . S e e G a ll, 5 5 2 U .S . a t _

_ , 1 2 8 S . C t. a t 5 9 7 . A s w e o u tlin e d in L iv e s a y I I , in d e te rm in in g th e e x te n t o f a§ 5 K 1 .1 d ep artu re, th e d i stri ctco u rtm u stco n si d er th e fi v e n o n -ex cl u si v e § 5 K 1 . 1 fact o rs, w hi c h a r e : ( 1) the us e f

ul ne s s of the de f e nda nt ’ s a s s i s t a nc e ; ( 2) the truthf ul ne s s a nd20

c om pl e t e ne s s of

the de f e nda nt ’ s i nf

orm a t i on a nd t e s t i m ony ; ( 3) the na tur e a nd e xt e ntof the de f e nda nt ’ s a s s i s t a nc e ; ( 4) a ny i nj ury s uf f e r e d orr i s k of

i nj ury or da nge rt o the de f

e nda nta nd hi s f

a m i l y a s ar e s ul tof

hi s a s s i s t a nc e ; a nd ( 5) the t i m el i ness of the as si st ance . S ee U . S . S . G . § 5 K 1. 1(a) (1)- (5); se e a l so L i vesa y I I, 48 4 F . 3d at13 30 -31. T he di stri ctcourtm ayconsi der f ac t ors bey on d tho se fi ve,

“ butonl y i f

the f a c t or s r e l a t e t o the a s s i s t a nc e pr ovi de d by the de f e nda nt . ” M a r t i n, 455 F . 3d a t1235, 1239 ( c onc l udi ng tha tthe di s tr i c tc our tc om m i tt e d l e ga l e rr orby consi deri ng , i n i t s § 5K 1. 1 anal ys i s, the threa tof future c i vi l l i abi l i ty, w hi ch w as nota s s i s t a nc e - r e l a t e d) ( e m pha s i s a dde d) ; s e e a l s o M c V a y , 447 F . 3d a t1354- 55 (dec l i ni ng t o con si der e xt entof § 5 K 1. 1 d eparture because di stri ctcourthad co m m itted leg al er ro r b y c o n sid er in g o n ly n o n -a ss istan ce re lated fa cts– M cV ay ’s “e x e m p la ry r e c o r d ” a n d h is “r e la tio n s h ip w ith h is d au g h te r ”

– in th e § 5 K 1 .1 anal ys i s) ; U ni t ed S t at es v. D avi s, 40 7 F . 3d 12 69 , 12 71 (11th C i r. 20 05 ); U ni t ed S t at es v. L ui z, 10 2 F . 3d 46 6, 46 9 (11 th C i r. 19 96 ). H e r e , th e r e s e n te n c in g tr a n s c r ip t m a k e s c le a rth a t th e d is tr ic t c o u r t, in d et erm i n i n g th e ex t en to f i t s § 5 K 1 . 1 d ep artu re, co n si d ered “ th e factth at[L i v esay] r e pudi a t e d the c ons pi r a c y a ta n e a r l y t i m e a nd no l onge rpa r t i c i pa t e d i n i t . ” T he d i stri ctco u rtev en ex p l ai n ed i n i t s § 5 K 1 . 1 ru l i n g th at“ [a] l th o u g h [L i v esay’ s] a c t i o n s w e r e n o ts u f

f i c i e n tt o me e tth e l e g a l s t a n d a r d s f o rw i th d r a w i n g f

r o m a21

co n sp i racy, th e C o u rt[w as] i m p ressed w i th th e factth atfro m j u stan o rd i n ary, c om m on s e ns e unde r s t a ndi ng, [ L i ve s a y ] di d s ubs t a nt i a l l y w i thdr a w f r om the conspi ra cy . ” H ow ever , L i vesa y’ s r epud i at i on of or “ com m on se nse” w i thd ra w al fr om the conspi ra cysi m pl y does notre l at e t o the as si st ance thatL i vesa y provi ded t o the go vernm ent . A cc ordi ng l y, the di stri ctcourtshou l d n othave consi dere d L i ve s a y ’ s r e pudi a t i on of orw i thdr a w a l f

r om the c ons pi r a c y i n de t e rm i ni ng the e xt e ntof i t s § 5K 1. 1 de pa r tur e . A s s uc h, the di s tr i c tc our tc om m i tt e d pr ong one or “p r o c e d u r a l” G a ll e rr o rw h e n it d e p a r te d 1 8 le v e ls u n d e r§ 5 K 1 .1 . N o n e th e le s s , it is u n n e c e s s a ry to r e m a n d f o rr e s e n te n c in g if

th e § 5 K 1 .1 pr oc e dur a l e rr ordi d nota f f e c tthe ul t i m a t e s e nt e nc e i m pos e d. S e e U ni t e d S t a t e s v. K e e n e , 4 7 0 F .3 d 1 3 4 7 , 1 3 4 9 ( 1 1 th C ir . 2 0 0 6 ) . I n f a c t, th e d is tr ic t c o u r t h e r e c le a r ly in d ic a te d th a t it w o u ld h a v e im p o s e d th e s a m e s e n te n c e e v e n if its § 5 K 1 .1 d o w n w a r d d e p a r tu r e w a s e rr o n e o u s . I n o th e rw o r d s , e v e n w ith o u t a n y § 5 K 1 .1 departure, the di stri ctcourtst i l l w ou l d h ave vari ed un der B oo ker f rom the advi sory G ui de l i ne s r a nge of

78 t o 97 m onths ’ i m pr i s onm e ntt o i m pos e as e nt e nc e of 60 m o n th s ’ p r o b a tio n ( w ith 6 m o n th s ’ h o m e d e te n tio n ) b a s e d o n th e § 3 5 5 3 ( a ) f a c to r s . T hus , w e a l s o r e vi e w the di s tr i c tc our t ’ s a l t e rna t i ve B ooke rva r i a nc e f r om the a d v is o ry G u id e lin e s r a n g e o f 7 8 to 9 7 m o n th s ’ im p r is o n m e n t. D . T h e A l te rn ati ve V ari an ce S en te n ceOrdin ari ly, a fter de terminingthat th edis tric t c ourt would haveimp os e d th esame 9 sentenc eno tw ith sta

ndingitsproc e dural error , w ewould e xaminewh e ther Live sa

y ’sultimate sentenc e wa s stillrea sonable in light of the Guidelines rang e calculated without the proc edural Guidelines er

ror ( i.e., the orig inal Guidelines ra ng e of 78 to 97 months’ imprisonment). See Ke ene , 4 70F .3 d at 13 49 -5 0. Ho wever, a s n ote d h ere in, weareun a bleto c on duc t this a

nalysis beca use the district cour

t failed to ade quately

explain it s chosen sentenceso to allow for meaning ful appe llate review. 22 A s t o the al t ernat i ve se nt ence , w e c on cl ud e thatanother G al l procedural error occurr ed because the di stri ctcourtfa i l ed t o adequ at el y e xp l ai n i t s var i ance f r om the a dvi s ory G ui de l i ne s r a nge t o i t s c hos e n s e nt e nc e i n aw a y tha ta l l ow s f or a ny m e a ni ngf

ul appe l l a t e r e vi e w . G a l l , 552 U . S . a t__, 128 S . C t . a t597 ( s t a t i ng th a t ad is tr ic t c o u r t c o m m its p r o c e d u r a l e rr o rb y , in te ra lia , “f a ilin g to a d e q u a te ly e xpl a i n the c hos e n s e nt e nc e –i nc l udi ng a n e xpl a na t i on f ora ny de vi a t i on f

r om the G ui del i nes r ange”). 9 H e r e , the di s tr i c tc our t , f orthe s e c ond t i m e , f

a i l e d t o gi ve a ny e xpl a na t i on of i t s r e a s o n s f

o ri mp o s i n g as e n t e n c e o f 6 0 mo n th s ’ p r o b a t i o n ( w i th 6 mo n th s ’ h o me d e te n tio n ) . A f

te rim p o s in g its s e n te n c e , th e d is tr ic t c o u r t d id p r o c e e d to lis t c e r ta in § 3553( a ) f

a c t or s . S o f

a r , s o good. H ow e ve r , the di s tr i c tc our tthe n ga ve no r e a s oni ng ori ndi c a t i on of w ha tf a c t s j us t i f

i e d s uc h as i gni f

i c a ntva r i a nc e f

r om the advi soryG ui del i nes r ange un der i t s a l t ernat i ve se nt ence . S ee P ug h, 51 5 F . 3d at 11 90 , 11 91 n. 8 (st at i ng thata di stri ctcourtneed no tdi sc uss e ac h § 35 53 (a ) f ac t or, but“ ‘ m us tm a ke a n i ndi vi dua l i z e d a s s e s s m e ntba s e d on the f a c t s pr e s e nt e d’ ” a nd, w here i ti m po se s ase nt ence ou t si de the G ui del i nes r ange, w i l l expl ai n w hy i thas23

done s o ( quot i ng G a l l , 552 U . S . a t__, 128 S . C t . a t597) ) ; A gba i , 497 F . 3d a t1230 (“ ‘ [T ] he se nt enci ng j ud ge shou l d setforth eno ug h t o sat i sf y the appel l at e c ou rtthat he ha s c ons i de r e d the pa r t i e s ’ a r gum e nt s a nd ha s ar e a s one d ba s i s f ore xe r c i s i ng h is o w n le g a l d e c is io n m a k in g a u th o r ity ’” ( q u o tin g R ita , 5 5 1 U .S . a t _

_ , 1 2 7 S . C t. a t 2 4 6 8 ) ) . A lth o u g h th e d is tr ic t c o u r t s ta te d th a t it w o u ld e x e r c is e its d is c r e tio n to im p o s e th e s a m e s e n te n c e e v e n if its § 5 K 1 .1 d e p a r tu r e w a s e rr o n e o u s , it s im p ly f a i l e d t o e xpl a i n i t s r e a s ons f orw hy i tw oul d do s o i n aw a y tha ta l l ow s f or m ea ni ng ful appel l at e r evi ew and p rom ot es the perce pt i on of fa i r s ent enci ng . S ee G al l , 55 2 U . S . at__ , 12 8 S . C t . at59 7. T hu s, there i s a l so procedural error und er G a l l i n the di s tr i c tc our t ’ s a l t e rna t i ve s e nt e nc e of aB ooke rva r i a nc e f

r om the advi soryG ui del i nes r ange of 78 t o 9 7 m on ths’ i m pri sonm entt o the i m po se d s e n te n c e o f

6 0 m o n th s ’ p r o b a tio n ( w ith 6 m o n th s ’ h o m e d e te n tio n ) . F o re x a m p l e , th e d i s tr i c tc o u r to f f e r e d n o e x p l a n a t i o n o rr e a s o n i n g o f h o w a se nt ence of 60 m on ths’ prob at i on (w i th 6 m on ths’ ho m e det ent i on ) f or an i nd i vi du al w ho pl ed gu i l ty t o k no w i ng l y pl ay i ng an ac t i ve and cruci al supervi sory ro l e i n a m assi v e $ 1 . 4 b i l l i o n frau d fo r atl eastfi v e years reflect ed th e seri o u sn ess o f th e o f f e n s e o rth e n a tu r e a n d c ir c u m s ta n c e s o f th e c r im e . T h e d is tr ic t c o u r t d id n o t s ta te o re x p la in in a n y w a y w h y it r e je c te d th e g o v e rn m e n t’s a r g u m e n t th a t,24

n o tw i th s t a n d i n g Li v e s a y ’ s t i me l y a s s i s t a n c e , Li v e s a y s h o u l d r e c e i v e “ s o me se nt ence of si gn i fi ca nce” i n thi s $1. 4 b i l l i on fr aud schem e bec ause he w as a “ key pl ay er , a s i gn i fi ca ntcog, i n the op er at i on of thi s f raud atH ea l thS ou th for a num ber of y e a r s . ” S e e R i t a , 551 U . S . a t__, 127 S . C t . a t2468 ( “ W he r e the de f e nda ntor pr os e c ut orpr e s e nt s nonf r i vol ous r e a s ons f

ori m pos i ng adi f

f e r e nts e nt e nc e , . . . the ju d g e w ill n o rm a llyg o f u r th e ra n d e x p la in w h y h e h a s r e je c te d th o s e a r g u m e n ts .” ) . F ur the rm or e , a s thi s C our tnot e d i n M a r t i n, the l e gi s l a t i ve hi s t ory of § 3553 r e ve a l s tha tC ongr e s s “ vi e w e d de t e rr e nc e a s ‘ pa r t i c ul a r l y i m por t a nti n the a r e aof w hi t e c ol l a rc r i m e . ’ ” M a r t i n, 455 F . 3d a t1240 ( c i t a t i on om i tt e d) . H ow e ve r , the di stri ctcourtprov i ded n othi ng m ore than a concl usory s t at em entthata var i ance f r om the a dvi s ory G ui de l i ne s r a nge of 78 t o 97 m onths ’ i m pr i s onm e ntt o the ul t i m a t e s e nt e nc e of

60 m onths ’ pr oba t i on ( w i th 6 m onths ’ hom e de t e nt i on) s a tis f ie d C o n g r e s s ’s im p o r ta n t c o n c e rn s o f d e te rr e n c e . T h e d is tr ic t c o u r t d id s u m m a r ily lis t tw e lv e o th e rin d iv id u a ls c o n v ic te d in the H e a l thS outh f

r aud a nd the i rr e s pe c t i ve s e nt e nc e s , w hi c h r a nge d f r om 24 m onths ’ pr oba t i on t o 60 m onths ’ i m pr i s onm e nt . H ow e ve r , the di s tr i c tc our tga ve n o d escri p t i o n o f th e cri m i n al co n d u ctco m m i tt ed b y th ese tw el v e d efen d an t s, m uch l es s a ny expl anat i on of ho w L i vesa y’ s c ri m i nal cond uctw as si m i l art o that of the co-conspi ra t ors w ho re ce i ved p robat i on . Indeed, am on g the se nt ence s not ed25

by the di s tr i c tc ourtw a s the s e nt e nc e of 5 m onths ’ i m pr i s onm e nti m pos e d on E m e ry H a rr i s , w ho w a s , a c c or di ng t o L i ve s a y ’ s P S I , the A s s i s t a ntC ontr ol l e rof F in a n c e a t th e s a m e tim e th a t L iv e s a y w a s th e A s s is ta n t C o n tr o lle ro f A c c o u n tin g . L iv es ay ’s P S I s tates th at L iv es ay in stru cted H ar ris to m an ip u late H ea lth S o u th ’s books a nd r e c or ds . T he di s tr i c tc our ta l s o not e d tha tW e s t on S m i th, the H e a l thS outh C ontr ol l e rf r om M a r c h 2000 thr ough A ugus t2001, r e c e i ve d 27 m on ths’ i m pri sonm ent . H ow ever , atse nt enci ng , the di stri ctcourtal so di d n otoffe r a n y c o m p a r is o n o f

H a rr is ’s o rS m ith ’s c o n d u c t to L iv e s a y ’s to e x p la in w h y it i m po se d a l es se r s ent ence on L i vesa y. In sum , the di stri ctcourt ’ s l i stof se nt ence s r e c e i ve d by othe rde f

e nda nt s i nvol ve d i n the H e a l thS outh f r aud pr ovi de s no i nd i ca t i on or expl anat i on as t o h ow L i vesa y’ s s ent ence se rves the needs des cr i bed in § 3 5 5 3 ( a ) ( 6 ) . In contra st , the di stri ctcourti n G al l di sc usse d w i th the go vernm entat se nt enci ng the ci rc um st ance s of tw o o f G al l ’ s c od ef endant s w ho had al re ady bee n s e nt e nc e d a nd, s pe c i f

i c a l l y , w he the rthe y a l s o ha d vol unt a r i l y w i thdr a w n f r om the c ons pi r a c y . S e e G a l l , 552 U . S . a t__, 128 S . C t . a t599. T he di s tr i c tc our ta nd the g o v e rn m e n t a ls o d is c u s s e d a n o th e rc o d e f e n d a n t w h o e n g a g e d in c o m p a r ab le c onduc t , butha d s e ve r a l c i r c um s t a nc e s tha tdi s t i ngui s he d hi m f r om the de f

e nda nt G a l l . S e e i d. a t___, 128 S . C t . a t600. T he S upr e m e C our tw a s abl e t o de t e rm i neAs t o th e go v ernm ent ’s re qu es tth atth i s ca s e b e r ea s s i gn edt o a d i ff er entdi s tri ctj u dge 10 on rema nd, we observe that the district judgehas alre ady recused himself from further participation in thi s matter. Thus, weneed not address this reque st. 26 f r om thi s c ol l oquy tha tthe di s tr i c tc our tha d c ons i de r e d the ne e ds r e f l e c t e d i n § 3553( a ) ( 6) a nd a s c e r t a i n w hy the di s tr i c tc our tha d i m pos e d al e s s e rs e nt e nc e on G a ll th a n th e s e o th e rc o d e f e n d a n ts r e c e iv e d . S e e id . W h ile w e d o n o t m e a n to i m pl y tha ts uc h ac ol l oquy i s ne c e s s a ry i n e ve ry c a s e , w e r e f e r e nc e the s e nt e nc i ng in G a ll a s a n e x a m p le o f w h a t typ e o f

r e c o r d e v id e n c e a id s ap p e lla te c o u r ts in a s s e s s in g w h e th e rth e s e n te n c in g c o u r t c o n s id e r e d th e § 3 5 5 3 ( a ) f a c to r s a n d w h y it i m po se d the chosen se nt ence . T h e r e f o r e , e v e n th o u g h th e d is tr ic t c o u r t s ta te d th a t it w o u ld e x e r c is e its di sc re t i on t o i m po se the sa m e s ent ence even i f i t s § 5K 1. 1 d eparture w as e rr one ous , i tc om m i tt e d G a l l pr oc e dur a l e rr orby f a i l i ng t o a de qua t e l y e xpl a i n w hy i tw ou l d d o so i n o rdert o al l ow for m ea ni ng ful appel l at e r evi ew . G al l , 55 2 U . S . at

__ , 1 2 8 S . C t. a t 5 9 7 . I V . CONCL US I ON F ora l l of the f or e goi ng r e a s ons , w e va c a t e L i ve s a y ’ s s e nt e nc e a nd r e m a nd thi s c a s e f

orr e s e nt e nc i ng i n am a nne rc ons i s t e ntw i th thi s opi ni on. 10 SEN TEN C E VA C A TED A N D R EM A N D ED W I TH I N STR U C TI O N S.