How to Build a Smoking Gun: Effectively Using Data and Documents

Imagine you are an investigator with access to an insider whose credibility cannot be impeached. This insider can precisely detail what the defendant did with the money or told his victims. You would spend days with that insider, figuring out how to ask the right questions to elicit the necessary information to make your case.

Documents and data can be the equivalent of such insiders, and prosecutors and agents should treat them accordingly. With some time and the right mindset, documents, and data can be turned into the equivalent of a “smoking gun,” strengthening cases and even helping make them in the first place.

I was a federal prosecutor for 11 years and a reporter for the Chicago Tribune. I will talk about some examples from real-life criminal cases below, but let’s start with two examples from journalism (one fictional, one real) that show how powerful this kind of work can be.

In the popular thriller The Girl With The Dragon Tattoo, the main character (an investigative journalist) tries to discover what happened to a girl who has been missing for decades. The big break comes when the journalist discovers archived photos from a parade the missing girl attended. Each image, in and of itself, is meaningless. But then the journalist does something with the pictures. He takes all the photos and puts them chronologically focused on the missing girl.

The resulting sequence shows the girl enjoying a parade and reacting with shock and horror when she sees something on the other side of the street. Something happened at that parade that changed everything, which is a vital part of the mystery.

Each photo was just noise on its own, but when aggregated, the overall sequence changed the entire course of the investigation.

Scene from the film, Spotlight

In Spotlight, the 2015 Oscar-winning movie based on actual events, Boston Globe reporters are investigating the sexual abuse scandal within the Catholic Church. One reporter looks up a suspect priest in the archdiocese’s annual directory and realizes that the archdiocese had used a euphemism to refer to the priest’s location. The reporters then recognized that the archdiocese had been using such euphemisms to refer to other priests and that the archdiocese had thus left a coded guide of the abuse in its directories.

A montage sequence ensues of reporters going through directories, climaxing with, of all things, the completion of a spreadsheet.

Spreadsheet from the film, Spotlight

Three Pulitzer Prize-winning Boston Globe reporters who did the work in real life — Walter Robinson, Michael Rezendes, and Sacha Pfeiffer — described it as “three and a half weeks of agony” in a telephone interview. They sometimes did the work in pairs to relieve the monotony on the eyes, with one reporter reading off from a directory and another person entering the data. But it was worth it. They said the resulting database was invaluable. The work showed that the individual examples they had heard about were not isolated and showed a larger pattern at work.

These fictional and real journalists made these breakthroughs by investing time and resources into aggregating little bits of information into something that no single witness would have given them, making them the equivalent of smoking guns. Prosecutors and agents can achieve similar results by thinking beyond the witnesses they will interview and investing time and resources into aggregating evidence into powerful tools.

I take three general approaches to data and documents in my investigations.

I. Count Something

Whether you are dealing with bank records, emails, or boxes of documents, simply counting and categorizing critical pieces of information can answer essential questions and yield robust evidence. In his book Better: A Surgeon’s Notes on Performance, Dr. Atul Gawande suggested that one way of becoming a better doctor was to count something: “If you count something you find interesting, you will learn something interesting.” This advice can also be useful in criminal investigations and trials.

Who are people talking to, how often, and what about?

These are things that can be quantified in potentially powerful ways.

Take the 2014 trial of former Connecticut Governor John Rowland. In describing the evidence that led to the jury’s guilty verdicts, a New York Times reporter described the government’s summary witness as providing “several powerful punches” simply by categorizing emails and phone records and counting them.

One issue at trial had been Rowland’s contract with a nursing home owned by a cooperating codefendant — was it a legitimate contract for services, or was it a way to disguise campaign work? To help address this, the summary witness, a retired postal inspector, counted their emails and found that the vast majority was related to campaign business and that only a small number was related to the nursing home’s business.

Re-creation of data from United States v. Rowland

Where is the money coming from, and where is the money going?

In Ponzi scheme cases, analysis of the bank records typically will reveal some common traits: (1) money coming in primarily from new investors, (2) little money going out for the kinds of investments that the fraudster had promised, and (3) some disconnect showing how the enterprise’s obligations far outstrip the enterprise’s actual assets or funds.

That is what happened with Charles Ponzi himself. Ponzi told investors in early 1920 that he could use their money to make huge profits using “international reply coupons” that could be bought at low rates in some countries and worth more in others. He promised fifty percent returns in just months.

The graph below summarizes the amount of money that Ponzi could collect from people in 1920 as his scheme suddenly grew. The scheme started small but proliferated before suddenly collapsing in the summer of 1920.

Chart based on reporting done by Mitchell Zuckoff in Ponzi’s Scheme: The True Story of a Financial Legend (2005).

Had Ponzi been just a lousy businessman rather than a fraudster, there should have been expenses showing that he was implementing the business model he had been pitching. There were not. The money that Ponzi collected went to hire more people to solicit more investors, to pay down debts, and to enjoy and show the wealth that made him look successful — suits for himself and jewels for his wife, a custom-made limousine, and a seven-bedroom house. Ponzi claimed to have given some money to a man who went to Italy to buy the international reply coupons necessary for his model to work. Still, there appears to be no evidence that this man existed.

Counting up the money can be a big part of going after people like Ponzi. Most money will go to maintaining or expanding the scheme (the employees that Ponzi hired and branches he opened to solicit more investors) and for the fraudster’s benefit, and little, if any, will be used to do what the fraudster has claimed to be doing.

Individual acts vs. a fraud scheme?

Anyone can make a mistake, which is generally not a crime. But if you can repeatedly show that someone was making the same mistake, it becomes much easier to show that a crime was committed.

The James Bond villain Goldfinger put it well: One time is luck, and twice is a coincidence, but the third time is enemy action. Similarly, one time may be an accident or mistake, two or three times may be negligence or sloppiness, but time after time is a scheme.

For example, in a campaign finance case (United States v. Whittemore), the defendant funneled money through multiple intermediaries to the ultimate recipient. The government used charts to show that each intermediary’s contribution followed the same pattern. One day alone, the defendant transferred $145,000 to seventeen relatives and employees, which were characterized as “bonuses” or “gifts,” and simultaneously encouraged them to make contributions, sometimes explicitly saying that the money was intended to cover the cost of the contribution. At trial, the government introduced charts showing each step being repeated repeatedly, a powerful depiction of the defendant’s conduct and intent.

From United States v. Whittemore

One “bonus” or “gift” might have been just that, but all these bonuses and gifts, aggregated together, were strong evidence of a scheme and of criminal intent.

Similarly, healthcare fraud cases can benefit significantly from simply counting something odd. People committing healthcare fraud typically have gotten very good at papering their files to fool an auditor, looking only at a few randomly selected claims in isolation. But if you step back and look at the files overall, that may reveal some ridiculous pattern that will be robust evidence of the overall fraud.

One common type of healthcare fraud involves doctors billing routine patient visits as if the visits were more complicated than they were. Complicated visits should take more time, and the American Medical Association includes typical times for each billing level. Adding up the number of visits in a day and multiplying them by the associated time can yield robust evidence of fraud, especially when the totals become particularly ridiculous, such as the doctors who regularly bill more than twenty-four hours’ worth of visits in a single day. Theoretically possible, but extremely unlikely.

Look for something weird, untrue, or inconsistent in the files and data, and you can turn it into something powerful at trial.

II. Contrast Something

Fraud cases often involve defendants making their victims (investors, clients, Medicare) believe that defendants are doing one thing when the reality is otherwise. They create a fake world that appears legitimate from the inside. Documentary evidence and summary charts can help jurors escape the phony world and see the reality themselves.

In Ponzi scheme cases, there will probably be a stark contrast between what the defendant says and what he is doing. Charles Ponzi told people that he was arbitraging postal reply coupons. Still, there were not enough coupons in circulation to make all the money that Ponzi was promising, and Ponzi was not buying large quantities of coupons as he would have had to if he meant what he was saying. The chart below shows this comparison.

Similarly, when forensic accountant Bruce Dubinsky tried to show that Bernie Madoff was running a Ponzi scheme, there was a contrast between the stock purchases shown in Madoff’s customer ledgers and those that occurred. Dubinsky found that ledgers reported purchases on particular days that were in greater volume than had happened in the entire stock market, and he discovered that ledgers reported purchases at prices that were lower than all the reported prices in the whole stock market.

From Dubinsky’s trial slides

From Dubinsky’s trial slides

Dubinsky’s slides were admitted at the trial of some of Madoff’s associates via his role as an expert. Still, many of them could have been admitted under Rule 1006, which allows a summary of voluminous records. Dubinsky testified at trial that he spent days going through thousands of banker boxes of Madoff documents housed in a warehouse on Long Island, and his work summarized the review of those and other voluminous records.

Contrasting lies with reality can work in prosecuting other types of fraud. In the late 1990s and early 2000s, a defendant conspired with a courthouse procurement officer to rig bids and overcharged the court (United States v. Millkiewicz). The government used multiple summary charts to prove the fraud, including one that juxtaposed (1) what the defendant purchased from his vendors, based on a summary of roughly 1,300 pages of records, and (2) what the defendant billed to the district court. Here is a visualization of one such comparison from October 2001:

Re-creation of data from United States v. Millkiewicz

Rather than making the jury compare vast amounts of records, charts like this can work for the jury. With the chart, the jury can more easily see that the court had paid for 100 more cartons of paper than the defendant himself could have delivered in October 2001.

In healthcare fraud cases, the records and data of legitimate providers can also strongly contrast with a defendant’s fraud. For example, nursing agencies and doctors often claim that patients are “confined to the home” for extended periods in home health cases. The agencies and doctors can submit claims, making the patients appear sick. Still, the files and data created by patients’ other providers can show that the patients were leaving their homes during the same periods and were in stable condition.

In a case involving cosmetic light treatments that were falsely billed as destroying precancerous lesions (United States v. Memar), the government learned that one patient had gotten such treatments while seeing another dermatologist. The government contrasted the two doctors’ records in a timeline that showed that (a) the defendant was allegedly destroying lesions nine times over a single year and (b) another doctor saw no such lesions during that same year.

From United States v. Memar

III. Track Something

You can also use summaries to track particular facts and pieces of evidence and to highlight patterns via repetition.

First, tracking something can create robust evidence that would not be obvious or compelling if presented solely via oral testimony, mainly when you track something that no one thought to lie about at the time.

Human resources records, such as the directories mentioned in the Spotlight example above, can be beneficial. Bonuses that continued and grew throughout a fraud scheme can help show that a defendant was more involved and knew more than she might claim. Also, payroll records can help show that a defendant was the only person who could have committed a particular crime.

Second, tracking something over time can reveal critical moments that corroborate witness testimony, show the defendant’s intent, or open up new investigative areas. In my fraud cases, I often break down the data by year and often by month, looking for those critical moments. Did the fraud peak sometime? If so, why? And if it never peaked, did the fraud continue despite red flags that should have been heeded? Did the scheme change at some point? If so, why?

For example, in one healthcare fraud case (United States v. Kolbusz), a doctor billed cosmetic light treatments as if they were medical procedures destroying large numbers of precancerous lesions. In 2006, one large insurance company started to catch on. In 2007, a peer warned the doctor that what he was doing looked like fraud. Data and documents showed that the doctor tried to keep the scam going. Suddenly, the total number of lesions he claimed to destroy each time dropped from a ridiculous number (120) to less unreasonable numbers (20–40), corroborating witness testimony about instructions that they had received. In context, this helped show criminal intent even more clearly.

From United States v. Kolbusz

Third, tracking disparate items in a single chart can help jurors see how the evidence fits together and save time for closing arguments. When evidence comes in at trial through multiple sources and out of chronological order, a simple timeline can help the jurors understand the materials better while you present the case. This can help them see the points you are trying to make rather than leaving them in confusion until closing arguments. For example, the timeline below was used in a Western District of Missouri case (United States v. Borders) involving multiple stolen and later recovered vehicles. Timelines like this one helped show what happened to a particular car, something that may have gotten lost otherwise.

From United States v. Borders

IV. Practice Pointers

Creating a good summary is like developing a good witness. It takes time and preparation, can be tedious and sometimes painful, but it can pay off.

Here are some pointers for creating good, effective summaries for trial:

Think of questions that data and documents might be able to answer.

Can the data corroborate a witness’s account of how the scheme worked? Can data from the defendant or someone else contradict the defendant’s statements or promises? Can the data tell you when a scheme peaked or collapsed, suggesting turning points useful to explain at trial? Are there flaws in the data or documents that can show the larger scheme (e.g., a defendant who is automatically billing for services not rendered will be revealed by occasional “mistakes,” such as billing for visits performed on patients who were dead or out of town)?

Build a database based on a targeted review of voluminous records.

When reviewing documents, do not count on finding a “smoking gun.” Cases can be made with the little details you must look for and aggregate. If you have boxes of documents to review, find a few things to track or add up and start recording the data. Create a template for the investigative team to use, test it out, track something, and collect the results in a table or spreadsheet.

Start counting, tracking, or contrasting something with draft charts.

Some helpful computer programs you can use are Microsoft Excel or Microsoft PowerPoint for charts, tables, or graphs, or Lexis TimeMap or PowerPoint for timelines (and there’s always paper!). If you need help setting up formulas, meet with a financial analyst and explain what you are trying to do (your office’s fiscal or accounting people generally should be familiar with Excel and might be able to help out as well). Your initial drafts may not work out or reveal helpful data that is unclear enough to use at trial. Step back and think of another way to look at the data from your database. Go back and track something else if necessary.

Make the charts clear and legible for a general audience.

Trials typically are not the place for complicated graphics based on complex formulas or for logarithmic scale. Make charts that convey a lot of information while being based on simple principles that a jury will be able to follow, and make sure the charts are legible to jurors looking at them from some distance. I generally make charts first in Microsoft Excel and then copy the chart over to PowerPoint, where I have more control over how the charts will look on the screen or when printed out.

Remember what the evidentiary rules allow and do not allow.

Lawyers can use three federal evidentiary rules to admit charts, which can differ in tone and use based on the particular rule being used. Charts admitted under Rule 1006 are substantive evidence and can go back to a jury for deliberations and generally should be non-argumentative. Charts allowed under Rule 611(a) or Rule 703 may be less neutral in presentation because they are viewed “more akin to argument than evidence.” Such charts cannot go back to a jury during deliberations.

Here’s a table to summarize the law regarding charts:

Show your work.

In a bank robbery case, simply saying that the defendant confessed is okay, but it is better first to give the details that help the jury figure that out. Similarly, it is OK to show a chart making your final point, but it is better to show your work and allow the jury to get there themselves. Before summarizing claims data or other records, I typically have a witness review specific examples. This can help establish the credibility of the summary and avoid confusing cross-examination.

Think about when you are going to admit your summaries at trial.

Data can corroborate insiders when describing a scheme, but consider flipping it around. If the summarized data goes in first, the jury might understand the scheme better and have a better context for the witnesses’ testimony. In healthcare fraud cases, presenting the defendant’s files highlighting implausible patterns may be a great way to start the trial. This can leave jurors with doubts about the defendant’s practice and sets up the testimony of witnesses whose testimony might otherwise be confusing or out of context.

Consider ways to ensure that your charts get admitted at trial.

Provide the underlying materials to defense counsel as part of discovery, and provide some charts to defense counsel as early as possible, even if they are in draft form. Consider providing the underlying spreadsheets with the formulas used to create the charts. This is by no means required but can avoid issues that might endanger admission at trial. Consider meeting with defense counsel to explain any methodologies ahead of trial. Also, consider filing motions with draft charts before trial to avoid last-minute problems.

Finally, do not wait until the trial to start thinking about what summaries might be helpful to at trial.

If you wait until trial to make your summary charts, you may never get to trial because you might never even get the case charged. Doing a summary chart during the investigative phase can open new leads and questions that can shape your case and even accelerate an investigation. Summary charts can corroborate witnesses and can help convince defendants to plead guilty. Embracing this approach early on can help you simplify and transform your cases.

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The Stephen Lee Law legal blog covers various topics, including healthcare fraud defense, investigations, data analytics, and the federal anti-kickback statute.

For further insights into building a smoking gun or for legal guidance with healthcare fraud defense, please contact Stephen Lee Law.

Willfulness: Often-Overlooked in Healthcare Fraud and Kickback Cases

Regarding healthcare fraud and kickback cases, I believe many attorneys – both prosecutors and defense attorneys – overlook one crucial element – “willfulness.”

Four main federal criminal statutes cover healthcare fraud (18 U.S.C. 1347, the Anti-Kickback Statute, false statements, and obstruction). All of them require t e government to prove beyond a reasonable doubt that the defendant acted “willfully.”

Understanding 'Willfulness' in Healthcare Fraud

Willfulness is the critical element that distinguishes a criminal case from a case that should be handled civilly or administratively.  Prosecutors and law- forcement agents often take this element for granted, but attorneys and practitioners should examine this element more closely.

Willfulness: The Defining Criterion

So what does it mean to act “willfully”?

Five circuits define “willfully” in their pattern jury instructions in the same way that the government has to prove beyond a reasonable doubt that the defendant knew what he or she was doing was illegal.

• 1st Circuit:  “An act or failure to act is ‘willful’ if done voluntarily and intentionally, and with the specific intent to do something the law forbids, or with the specific intent to fail to do something the law requires to be done; that is to say, with bad purpose either to disobey or to disregard the law.”  Instruction 4.18.1347 (healthcare fraud).

• 3rd Circuit:  “That [defendant] knew [his/her] conduct was unlawful and intended to do something that the law forbids.  That is, to find that [defendant] acted willfully, you must find that the evidence proved beyond a reasonable doubt that [defendant] acted with a purpose to disobey or disregard the law.” Instruction 5.05 (note that the 3rd Circuit does not explicitly include “willfully” in its healthcare fraud instruction – make sure to ask for this to be included!).

• 5th Circuit:  “[T]he act was committed voluntarily and purposefully, with the specific intent to do something that the law forbids; that is, to say, with bad purpose either to disobey or disregard the law.”  Instruction 2.59 (healthcare fraud).

• 8th Circuit:  “A defendant acts willfully if he knew his conduct was wrongful or unlawful.”  Instruction 6.42.1320 (note that this definition is included in the instruction for Anti-Kickback Statute violations but not in the definition for healthcare fraud cases – make sure to ask for this definition to be included in all types of HCF cases!).

• 11th Circuit:  “The act was committed voluntarily and purposely, with the intent to do something the law forbids; that is, with the bad purpose of disobeying or disregarding the law.”  Instruction B9.1A (note that the 11th Circuit did not specifically include “willfully in its healthcare fraud instruction – make sure to ask for this to be included!).

The Legal Interpretation of 'Willfully'

Two other circuits have language in their pattern jury instructions suggesting similar instructions:

• The Seventh Circuit’s pattern jury instructions for healthcare fraud do not define “willfully” but notes that one 2008 case suggests that “willfully” requires proof that a defendant knows that his or her conduct was “in some way unlawful.”  In the cases I handled as a prosecutor in Chicago, we included a version of that definition.

• The Ninth Circuit’s jury instructions for healthcare fraud and the Anti-Kickback Statute refer to willfulness, and the notes for Instruction 5.5 state that willfulness in healthcare fraud cases generally requires knowledge that a defendant’s conduct was unlawful.

Following these circuits, willfulness means more than unethical, immoral, or sketchy. While the government does not have to prove that an individual knows the particular statutes that he or she violated, the government has to prove that the individual knew that their conduct violated some law.

Please note that the Sixth Circuit does NOT define willfully the same way as other circuits.  In its healthcare fraud instruction (10.05), the Sixth Circuit defines “knowingly and willfully” as follows: “An act is done ‘knowingly and willfully’ if it is done voluntarily and intentionally, and not because of mistake or some other innocent reason.”

The Sixth Circuit’s instruction is, I believe, incorrect as it treats “willfully” as synonymous with “knowingly.”  It also appears to not take into account an important case on this topic – United States v. Ajoku (08-1094 in the Central District of California, 11-50230 in the Ninth Circuit, and 13-7264 before the Supreme Court).

In 2011, Kelechi Ajoku, a licensed vocational nurse, was convicted by a jury of making false statements in a healthcare matter under 18 U.S.C. 1035.  Defense counsel had asked that willfulness be defined as requiring proof that the defendant “acted with knowledge that his conduct was unlawful.”  The district court rejected this request and gave instructions that treated “willfully” as synonymous with “knowingly.”

In 2013, the Ninth Circuit affirmed that instruction.  The Ninth Circuit wrote, “[i]n the context of false statement cases … willfulness simply means ‘deliberately and with knowledge,’ and does not require knowledge of unlawfulness.” 

The case was appealed to the Supreme Court.  2014, the Solicitor General confessed to the error, and the Supreme Court vacated the judgment. 

In 2015, Ajoku was re-tried. 

This time, the district court separated “knowingly” and “willfully” in the instructions.

This time, the district court told jurors that the government had to prove that Ajoku had acted “willfully “ with a bad purpose.  In other words, the defendant committed the act voluntarily and purposefully, and with knowledge that his conduct was unlawful.”

This time, Ajoku was found not guilty.

Unfortunately, the Sixth Circuit’s jury instruction on healthcare fraud has not been updated in light of the Ajoku case.  Some people may have been convicted under this definition and should not have been convicted.

If you’re in the Sixth Circuit, ask for a “willful” definition that fits with other circuits.

Strategic Implications for Legal Practitioners

Regarding evidence, attorneys should look carefully at the facts to determine whether the government can prove willfulness in particular cases.  Here are some questions to consider:

• Did a defendant sign a Medicare provider enrollment form?  If he or she did, the government would use that form as evidence of willfulness because signing that form (1) establishes knowledge of the healthcare fraud statute and the Anti-Kickback Statute and (2) contains the statement:  “I will not knowingly present or cause to be presented a false or fraudulent claim for payment by MedicareHowever, But if a defendant did not sign a form, the government may have difficulty proving that he or she acted willfully, particularly when it comes to kickback cases or defendants who are not medical professionals.

• What kind of contact did a defendant have with the government before being prosecuted?  If a defendant was notified that they were an outlier, that might show willfulness.  However, if a defendant was audited and told their claims were acceptable, that might undercut the government’s proof of willfulness. 

• Does the government’s case relate to something many people get wrong?  If so, that could show mistakes and undercut willfulness.  For example, office visits and other evaluation and management (E&M) services have a high error rate.  In 2010, the government estimated that 55 percent of claims for E&M services were improperly coded and lacked documentation, resulting in $6.7 billion in improper Medicare payments.  If so many doctors are making mistakes here, specific evidence in a criminal case should show that it was not just another mistake. Similarly, while cash in unmarked envelopes is an illegal kickback, the further a case gets from that scenario, the harder it will be for the government to show willfulness in a kickback case.

• Were there safe harbors that might undercut willfulness even if not technically applicable?  There are lots of safe harbors to the Anti-Kickback Statute.  If a defendant believed in good faith that he or she fell within a safe harbor, that defendant did not act “willfully” even if he or she was wrong. 

• What did a particular defendant know or not know?  If a defendant was kept in the dark about his or her role, or was misled by his or her employer, or was simply naïve or gullible, that would undercut willfulness.  This is especially important in home-health, DME and other “doctor-enabled” fraud cases where doctors often do not understand how the overall fraud is working and may not even understand that they are part of a fraud.

• If a defendant talked to the government, did they admit knowing that their conduct was illegal, or did they just acknowledge that there were some erroneous or mistaken claims?  The distinction is essential.  Admitting in hindsight that a claim was improper is NOT the same as knowing at the time that one’s conduct was illegal. 

Prosecutors should scrutinize their cases carefully for evidence of willfulness.  If they do not have such evidence, they should consider referring the case for civil or administrative resolution, or they should just decline the case entirely.

Defense attorneys should also scrutinize their call for evidence of willfulness.  And if the case has to go to trial, consider focusing the defense on willfulness.  Doing so turns the case around by concentrating on a person’s state of mind, an area that the government might have taken for granted and can do little to build up once a case goes over.  Focusing a jury’s attention specifically on willfulness might be more effective than trying to defend the legitimacy of particular claims or trying to say that everything had been done perfectly.

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The Stephen Lee Law legal blog covers various topics, including healthcare fraud defense, investigations, data analytics, and the federal anti-kickback statute.

For further insights into willfulness or legal guidance with healthcare fraud defense, please contact Stephen Lee Law.

Federal Sentencing Disparities Uncovered: A Closer Look at Federal Guidelines

A recent report by the U.S. Sentencing Commission sheds new light on the prevalence of unwarranted sentencing disparities in federal cases. It should attract more attention from prosecutors, defense attorneys, judges, and the public.

Introduction to Sentencing Discrepancies

The sentencing guidelines were created partly to deal with a specific problem: the concern that similarly situated defendants who committed similar crimes were getting different sentences based on which judge the defendant was assigned to. Under the guidelines, a judge must start sentencing by calculating the offense level reflecting the defendant's offense, the defendant's criminal history, and a guideline range reflecting the sentence the judge must consider in sentencing the defendant. The U.S. Supreme Court held in the 2005 U.S. v. Booker decision that the sentencing guidelines were not mandatory but still recognized the importance of promoting uniformity in sentencing.

Unfortunately, new data from the commission shows that post-Booker federal sentencing is not going as Congress and the Supreme Court had hoped.

The Role of the Sentencing Guidelines Post-Booker

This most recent set of such data is contained in "Intra-City Differences in Federal Sentencing Practices," a report issued in January 2019. In the report, the commission looked at almost 150,000 cases in which judges in 30 cities had significant discretion in sentencing and where there was sufficient information to make comparisons. Overall, the cases were about 30 percent drug cases, 14 percent illegal entry or re-entry cases, 13 percent fraud cases, 13 percent gun cases, and 29 percent other cases.

The report has a wealth of information and is worth studying by lawyers in the 30 cities covered. I've designed the charts below to highlight the overall trends and to make comparisons between those cities more straightforward.

Analyzing the Data: Disparities Within Cities

First, the Sentencing Commission found vast differences in sentences imposed by judges within the same city, concluding: "In most cities, the length of a defendant's sentence increasingly depends on which judge in the courthouse is assigned to his or her case."

Philadelphia provides the most extreme example of the 30 cities studied by the commission. In Philadelphia, one judge, on average, gave sentences more than 20 percent greater than the city average, while another judge, on average, gave sentences around 40 percent lower than the city average. Philadelphia thus had the most significant "spread" of any major city, at 63.8. Manhattan had the second-highest spread (59.1), with two judges on average giving sentences more than 20 percent above the city average and one judge on average giving sentences more than 30 percent below the city average.

The Extent of Below-Guideline Sentences

Second, the Sentencing Commission found that most judges nationwide give, on average, sentences well below the low end of the applicable guideline range. Out of the 30 cities studied, the average judge gave sentences below the low end of the guidelines in all but one. Average sentences in eight cities (Alexandria, Boston, Chicago, Los Angeles, Manhattan, Portland, Salt Lake City, and Seattle) were more than 25 percent below the low end of the average guideline range.

Judicial Discretion and the Guidelines

Third, there appears to be a divide between judges regarding the weight of the guidelines. Of the 339 judges whom the commission studied, there were no judges who were, on average, giving sentences significantly more significant than the guideline minimum, but more than 90 percent of judges gave average sentences below the guideline minimum. No judge gave sentences at or above the guideline minimum in Manhattan, even those who gave sentences far more significant than their peers. Chicago only had one judge out of 24 whose average sentence was at or above the guideline minimum.

Lawyers practicing in the federal courts probably already knew much of this anecdotally, but the commission's data analysis puts some hard numbers on trends that lawyers and policymakers should be aware of and address.

The commission's report does not address why these differences in sentencing and these variations from the guidelines are occurring. The commission does look at the mix of cases that different judges and districts had, and this may explain some of the patterns, but probably not much, given that the analysis period covered several years' worth of sentencings.

However, looking at some of the publicly available, case-specific data may provide clues as to what is going on. Many lawyers may not be aware of this. Still, the commission has made a lot of anonymized data about sentencings available: first, in SAS and SPSS files that can be accessed via the commission's website, and second, in additional formats that can be accessed via the University of Michigan's Institute for Social Research.

My analysis of the fiscal year 2016 data online via the Institute for Social Research points to some possible factors.

First, sentences appear to go further down from the guidelines as the sentencing ranges increase. The graph below shows that economic crimes (as indicated by Guideline 2B1.1) and drug crimes (as indicated by Guideline 2D1.1) result in sentences further below the guidelines as the ranges exceed 60 months (five years). Large cities such as New York and Chicago tend to see cases with more significant loss amounts and drug quantities. They thus may see more sentences below-guideline than in smaller cities with lower loss amounts and drug quantities.

Second, as seen in the graph below, many economic crime offenders are getting sentences below guidelines, especially as loss amounts go up. This may reflect a discount of large loss amounts, perhaps a discounting of some of the sentencing enhancements in 2B1.1, or perhaps credit for reputational harm and loss of professional licenses.

More research and discussion are needed, but there is enough data now to make the discussion about more than just anecdotes and outlier cases. The commission's data analysis raises serious questions that should impact sentencing recommendations and perhaps help reopen a debate about balancing judicial discretion with the goal of uniformity.

Navigating New Norms: Federal Prosecutors and Sentencing Guidelines

In the wake of the U.S. Sentencing Commission's revealing data on federal sentencing practices, a paradigm shift appears necessary for federal prosecutors. Traditionally guided by the Justice Manual to recommend sentences within the guideline ranges, prosecutors now face a landscape where judges frequently impose sentences below these ranges, especially in high-guideline cases.

This trend challenges the conventional prosecutorial strategy and calls for a reevaluation of sentencing recommendations to align with the evolving judicial discretion and the overarching goal of mitigating unwarranted sentencing disparities. As the legal community grapples with these findings, the implications for federal prosecutors, defense attorneys, and judges underscore a critical moment of reflection and potential recalibration in federal sentencing practices.

Implications for Federal Prosecutors

First, federal prosecutors should reconsider their approach to sentencing recommendations. The U.S. Department of Justice's Justice Manual strongly suggests that prosecutors recommend sentences within the guidelines range but also imposes a duty on the prosecutor to recommend a sentence that would not result in an unwarranted sentencing disparity.

Judges impose below-guideline sentences, particularly in cases with high guideline ranges, so prosecutors should consider recommending more that reflect consistency with the imposed sentences. Prosecutors should not make high opening bids with the expectation that the judge will split the difference. Prosecutors should make recommendations to meet all the Section 3553 factors, including avoiding unwarranted sentencing disparities. The reality is that within-guideline sentences sometimes might be unnecessary given the sentences imposed post-Booker.

Prosecutors may also want to reconsider some recommendations tied to the guidelines' low end. If the average sentence in a district is 20 percent or more below the guidelines, then recommending 20 percent off the low end of the guidelines for a cooperator does not mean much.

Strategic Considerations for Defense Attorneys

Second, defense attorneys should consider using the data in the right circumstances. They can look at the anonymized data available online and see how similar defendants have been sentenced and point out cases or trends favorable to their clients. Defense attorneys in those few courtrooms where the average sentence is at or above the guideline minimum may want to point out that a sentence within the guidelines might create an unwarranted sentencing disparity, given what other judges are doing.

The Role of Judges in Addressing Disparities

Third, judges may want to discuss with their peers how their sentencing approaches align with the guidelines and Congress' intent to avoid unwarranted sentencing disparities, particularly in districts with wide ranges in sentences.

Policy Considerations and Future Directions

Fourth, policymakers and the public may want to examine the sentencing guidelines given this data. Are specific guidelines resulting in offense levels that are too high? Or does the sentencing table need to be recalibrated, as a one-level increase in a defendant's offense level means two or three more months at the lower levels but 30 or more months at the higher levels? And those courtrooms where sentences are meager might warrant some further examination.

Conclusion: Balancing Discretion and Uniformity

The Booker decision properly gave judges discretion in individual cases. Still, the effects on overall fairness need to be studied more, as many defendants' sentences appear to depend significantly on the judge that they end up standing before.

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The Stephen Lee Law legal blog covers various topics, including healthcare fraud defense, investigations, data analytics, and the federal anti-kickback statute.

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