A federal judge has dramatically scaled back the Department of Justice’s recommended sentence for a convicted associate of lobbyist Jack Abramoff, suggesting the government may have sought to punish Kevin Ring for exercising his constitutional right to trial.
U.S. District Judge Ellen Huvelle’s opinion, issued today, concluded that Ring’s recommended sentence should be no more than 4 years and 9 months in prison. Prosecutors had recommended up to nearly 22 years. Huvelle is slated to issue a final sentencing decision Oct. 26.
Prosecutors had wanted Ring to go to prison longer than any other defendant in the sprawling public corruption probe, including Abramoff, the mastermind. They argued that an assessment of the facts of his case under the Federal Sentencing Guidelines justified the punishment.
But Huvelle wrote: “The notion that an ostensibly objective system of sentencing guidelines can produce such wildly varying results for essentially the same offense conduct is deeply troubling.”
She continued: “Indeed, as Ring argues, if the Guidelines are ‘subject to manipulation’ in this fashion, it would mock the very consistency the Guidelines were meant to impose on such elementary concepts as the ‘offense level.’”
Ring had alleged that prosecutors sought to retaliate against him for exercising his sixth amendment right to trial rather than agreeing to a plea bargain. “It’s easy to see why such an inference might be justified,” Huvelle wrote.
Leniency and Punishment
Ring, age 40, was a junior lobbying associate of Abramoff in the early to mid-2000s at the law firm then known as Preston Gates, Ellis & Rouvelas Meeds LLP and later at Greenberg Traurig LLP.
He was convicted last November in federal court in Washington, D.C., of paying an illegal gratuity, six counts of honest services wire fraud, and one conspiracy count. Ring’s first trial in 2009 resulted in a hung jury on all counts.
The government sought to put Ring behind bars longer than Abramoff, who has already been released from prison; and longer than chief conspirator Michael Scanlon, who was sentenced to 20 months incarceration.
Abramoff and Scanlon were convicted of, among other things, a kickback scheme that defrauded Indian tribe lobbying clients of tens of millions of dollars. Abramoff and Scanlon agreed to pay restitution for their crimes of approximately $20 million each. Both pleaded guilty and agreed to help prosecutors in their ongoing criminal probe. Abramoff received leniency from the government and reduced his sentence by 75 percent.
Ring was convicted of giving expensive restaurant meals and tickets to sporting and music events to public officials to influence their actions in favor of his and Abramoff’s lobbying clients. He was not accused of directly pocketing big money from the fraud, though the government did scrutinize a $135,000 finder’s fee Ring received from one of Scanlon’s business entities for steering grassroots lobbying business to it. No charges were filed in connection with the payment.
Ring contends that in addition to his decision to go to trial, prosecutors are attempting to punish him for not giving them enough information to secure an indictment against his former boss, then-Rep. John Doolittle (R-Calif.)
The government had evidence that Ring helped facilitate a make-work job with Abramoff for Doolittle’s wife, which the government investigated as a potentially corrupt payment intended to influence the congressman.
One of Ring’s lawyers, Richard Hibey of Miller & Chevalier Chartered, wrote Attorney General Eric Holder in October 2010 asking him to halt Ring’s prosecution. “The prosecutors found Mr. Ring’s testimony wanting because he could not and therefore, despite much importunation, would not implicate Congressman John Doolittle in criminal activity,” Hibey wrote.
A Justice Department spokeswoman declined to comment, citing department rules against speaking on pending matters.
Justice Department prosecutor Nathaniel Edmonds told Huvelle in an August court hearing that a stiff sentence would not be a punishment for going to trial. Witnesses who cooperate are rewarded with leniency, he said. “It’s not retaliation,” Edmonds said, according to the Associated Press.
Although the sentencing guidelines state that “a defendant’s refusal to assist authorities in the investigation of other persons may not be considered as an aggravating sentencing factor,” the government can and does deal more severely with defendants whom it believes did not cooperate, lawyers say.
“They’re not going to cut him much slack when he made them go to court to prove the case,” said Peter Henning, a former federal prosecutor who teaches law at Wayne State University in Michigan. “If you take them to trial, beware.”
Huvelle appeared skeptical of such tactics. “The government’s argument that it has unlimited freedom to afford ‘leniency’ to those who plead guilty and that this does not amount to a penalty for the exercise of a defendant’s constitutional right to stand trial is unpersuasive,” the judge wrote.
Sentencing Guidelines Spotlighted
Huvelle’s opinion puts a spotlight on the Sentencing Guidelines, which are intended to provide consistency in sentencing for similar conduct.
The Guidelines prescribe a range of recommended sentences for various criminal charges. Extra points can be added to a convicted person’s “offense level” for conduct that reflects a more serious variation of the crime or for having a leading role in the criminal conduct. The more points, the longer the recommended prison sentence.
Essentially, Ring argued in court that the government was putting the worst possible spin on his crimes to gin up his recommended “offense level.” He claimed the harsher punishment was in retaliation for his decision to go to trial.
At one point, in a pre-sentencing memo that has not been made public, the government recommended on offense level of 43, the equivalent of life in prison, according to a footnote in a May court filing by Ring.
Prosecutors later settled on an offense level calculation of 37, or between 210 and 262 months in prison.
Abramoff’s offense level, by contrast, was calculated at a level 32 initially, but the government asked to reduce it to 25 to reflect his substantial cooperation in their investigation. For Scanlon, the government endorsed an offense level of 17 after crediting him with substantial cooperation.
Abramoff pleaded guilty in 2006 and was ordered in 2008 to serve a four-year prison sentence. At the time, he was already behind bars for a separate fraud conviction in Florida. He was released last year after three and a half years. The government sought a two-year sentence for Scanlon, though he was sentenced in February to slightly less.
Of the 21 individuals convicted in the sprawling Abramoff public corruption probe, 18 people pleaded guilty and three were found guilty at trial.
Battle over Methodology
For months, Ring’s defense team and prosecutors had been battling over the methodology the government used in setting Ring’s recommended punishment under the sentencing guidelines.
In her opinion, Huvelle came down largely in favor of Ring, though not on every point.
One argument in which the government prevailed involved the Supreme Court’s ruling in an appeal brought by former Enron CEO Jeffrey Skilling. That June 2010 ruling limited the government’s use of the “honest services fraud” charge to allegations involving bribes and kickbacks.
The statute, which makes it a crime to use “a scheme or artifice to deprive another of the intangible right of honest services,” often provides prosecutors an easier avenue to win conviction that proving the underlying conduct.
Because Ring’s second trial took place after the Skilling decision, Huvelle noted, the government was required to prove a bribery scheme in order to win conviction on an honest services charge. Huvelle thus sided with the government’s argument that it could properly apply sentencing calculations related to a bribery charge to Ring, even though he hadn’t been convicted of bribery per se.
This point was important to the government in arguing for enhancements to Ring’s sentence. By applying calculations related to bribery, the government then was able to argue for a 16-level sentencing enhancement related to the amount of the “value of corrupt payments” made by Ring to public officials to influence their actions.
But prosecutors then overreached with the judge in putting a minimum $1 million value on Ring’s “corrupt payments,” which included meals at expensive restaurants and tickets to sporting and entertainment events. The seating was in a luxury skybox in Washington’s Verizon Center leased by Abramoff.
“To begin with, the government’s figure for the value of the tickets is clearly too high,” Huvelle said in the opinion, noting that the tax code uses the face value of a ticket price when allowing business deductions for leasing a luxury skybox. The face value of the tickets was around $75.
Huvelle also noted that methodology and guidelines calculations the government used in recommending sentences for other defendants, including ex-Rep. Bob Ney (R-Ohio), valued the corrupt payments at under $120,000. Huvelle said prosecutors did not seek to put a value on the corrupt payments when calculating sentences for Todd Boulanger, Neil Volz or Tony Rudy – who, like Ring, were former congressional staffers working with Abramoff at Greenberg Traurig.
“The practical effect” of valuing Ring’s corrupt payments at $1 million was “an 8-level increase in Ring’s offense level,” which could have meant an increase of more than six years in prison compared with recommended sentences of other convicted conspirators, Huvelle wrote.
“The Court notes that the government could easily have avoided much of this dispute by recommending that the Court apply the Guidelines in a manner consistent with Ring’s co-defendants,” Huvelle wrote.
A ‘Cavalier Approach’
The Guidelines also allow the government to seek a longer sentence based on the value of the “loss” to the person or entity defrauded. Such amounts are typically larger than the bribe paid to secure an advantage and represent a profit or other gain.
The government argued that Ring’s clients received benefits valued at more than $14 million from his corrupt gifts to public officials. That amount allowed prosecutors to argue for a 20-level sentencing enhancement or up to an additional nine years in prison.
That $14 million figure included an additional $7.3 million from the Department of Justice that Ring’s clients, the Choctaw Indian tribe, received in an increase in federal appropriations to build a jail; $4.95 million in transportation earmarks in the House of Representatives secured by John Albaugh, a friend of Ring who was chief of staff to then-Rep. Ernest Istook (R-Okla.); and $400,000 appropriated for a water project study facilitated by then-Rep. Doolittle, for whom Ring once worked.
Had the judge accepted the 20-level enhancement, it would have superseded the 16-level enhancement prosecutors had argued for in valuing the corrupt gifts at more than $1 million.
However, Huvelle said the government failed to provide evidence about the costs of building the Choctaw jail – specifically, what the “net benefit” to the Indian tribe might have been had the jail construction contract been awarded competitively rather than on a “sole-source” bid. Part of Ring’s lobbying of the Justice Department was to secure permission for the tribe to award the jail contract non-competitively.
Huvelle also said prosecutors failed to prove that the appropriations wouldn’t have been secured anyway, regardless of the tickets and meals that Ring provided.
A March Madness basketball game ticket that Ring gave to David Ayres, then the chief of staff to Attorney General John Ashcroft, was submitted by the government as evidence of corrupt intent by Ring to influence the Justice Department’s decision to award a higher appropriation for the Choctaw jail.
“Glad he got a chance to relax, now he can pay us back,” Ring wrote in an email at the time of Ayers.
But Huvelle countered: “[T]here is no evidence connecting this ticket with the decision to award the additional funding for the jail.”
She added: “The Court cannot conclude that the government has sustained its burden of proving by a preponderance of the evidence that a 20-level enhancement is appropriate given the host of problems with these figures.”
Huvelle also pointed to a “much more fundamental flaw with the government’s calculations,” namely that it “resists any attempt to define what exactly is a corrupt payment.” She said some gifts to public officials aren’t necessarily corrupt.
The lack of evidence is “unacceptable,” the judge wrote. “Such a cavalier approach cannot be squared with the government’s burden of having to prove a ‘reasonable estimate’ of the value of corrupt payments,” Huvelle said, concluding that the Court cannot “reasonably determine” the value of the corrupt payments for purposes of sentencing.
Final sentencing calculation
The government did win Huvelle’s approval of a 3-level enhancement based on Ring’s role as a supervisor of the criminal activity. Ring was described in court as “Chief Operating Officer” of Team Abramoff, though he argued he held a junior role that was primarily administrative.
Ring also failed to convince Huvelle that he had “accepted responsibility” for his actions by meeting 13 times with prosecutors and FBI agents before his 2008 indictment. Ring argued unsuccessfully for a reduced sentencing recommendation based on accepting responsibility.
But the judge declined to endorse the government’s argument that Ring has obstructed justice in giving misleading statements to Henry Schuelke, an outside investigator hired by Greenberg Traurig to investigate the Abramoff operation after news articles first surfaced in 2004 about his questionable lobbying practices.
In the end, Huvelle agreed to add 13 points to Ring’s “base level offense” of 10 for offering or giving a bribe. The government, by contrast, had sought to add 27 points to Ring’s base offense level.
Huvelle concluded that Ring’s recommended sentence therefore should be between 3.8 and 4.75 years in prison.
The case is being prosecuted by Edmonds, an assistant chief in the Criminal Division’s Fraud Section; and Peter M. Koski, a trial attorney in the Public Integrity Section.
Andrew Ramonas contributed to this report.