Case 1:14-cr LO Document 21 Filed 06/11/15 Page 1 of 16 PageID# 170

Transcription

1 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 1 of 16 PageID# 170 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA Alexandria Division ) UNITED STATES OF AMERICA, ) ) v. ) No. 1:14cr373 ) TYLER EUGENE HARBER, ) Hon. Liam O Grady ) Defendant. ) Sentencing: June 12, 2015 ) DEFENDANT S AMENDED POSITION ON SENTENCING FACTORS 1 Tyler Harber comes before the Court in connection with the first-ever prosecution of illegally coordinated federal election contributions. He committed misconduct, and has accepted responsibility for his misconduct, all of it. His actions have cost him significantly. Once a promising, rising star in Republican campaign circles, Mr. Harber has lost his career and is unlikely to work in the field of politics again. His concern now is to minimize the impact of his poor decisions on his wife and children. There is no dispute regarding the Probation Office s calculated guideline range of 46 to 57 months in this case. Mr. Harber, however, respectfully submits that a variant sentence of 20 months is sufficient but not greater than necessary to achieve the goals of sentencing. He is a first-time offender who has experienced serious collateral consequences as a result of his prosecution. Such a sentence also appropriately takes into account Mr. Harber s serious medical condition as well as that of his one-year old son. Additionally, it is further warranted when measured against recent sentences imposed in other campaign finance cases, most notably two cases in this district: U.S. v. 1 This amended sentencing memorandum is being filed with additional redactions as set forth in defendant s second motion to seal, filed June 11, 2015.

2 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 2 of 16 PageID# 171 Danielczyk, 11-cr-85 (Cacheris, J.) (imposing sentence of 28 months in campaign finance case with an advisory guideline range of more than 5 years), and U.S. v. Magliocchetti, 10-cr-286 (Ellis, J.) (imposing sentence of 27 months in extraordinary campaign contribution fraud case with an advisory guideline range of 46 to 57 months). Finally, such a sentence is more than enough to achieve deterrence given the severe consequences that Mr. Harber has already experienced as a result of this prosecution. BACKGROUND On February 12, 2015, Mr. Harber pleaded guilty with a plea agreement to a two-count information charging him with illegal coordination of federal election contributions in violation of 52 U.S.C , and false statements in violation of 18 U.S.C The case was continued for sentencing and the preparation of a Presentence Investigation Report ( PSR ). Pursuant to 18 U.S.C. 3553(a), Rule 32 of the Federal Rules of Criminal Procedure, and Section 6A1.3 of the advisory United States Sentencing Guidelines, Mr. Harber, by counsel, states that he has received and reviewed the Presentence Investigation Report ( PSR ), and has no objection to the PSR s calculation of the advisory guideline range of 46 to 57 months. Although initially raising a legal objection to the Probation Office regarding the 2-level enhancement under 3C1.1, undersigned counsel has notified both the government and the Probation Officer that the objection is withdrawn. 2 As set forth more fully below, Mr. Harber respectfully submits that a variant sentence of 20 months is warranted in this case based on the application of the 3553(a) sentencing factors. 2 In the final PSR, the Probation Office bases the 2-level enhancement on the additional investigation undertaken by agents after Mr. Harber s admitted false statements, and Mr. Harber does not dispute that such efforts by law enforcement are a valid basis for the enhancement. 2

3 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 3 of 16 PageID# 172 ARGUMENT I. Legal Standard After United States v. Booker, sentencing is no longer a mathematical exercise. The sentencing guideline range is now advisory, and courts must consider the recommended guideline range as one of seven statutory sentencing factors enumerated in 18 U.S.C. 3553(a). Booker, 543 U.S. 220, (2005). In determining a sentence, courts must impose the least amount of imprisonment necessary to accomplish the purposes set forth in 18 U.S.C. 3553(a). Those factors include: (a) the nature and circumstances of the offense and the history and characteristics of the defendant, (b) the kinds of sentences available, (c) the guideline range, (d) the need to avoid unwarranted sentencing disparities, (e) the need for restitution, and (f) the need for the sentence to reflect the following: the seriousness of the offense, to promote respect for the law and to provide just punishment for the offense, to afford adequate deterrence, to protect the public from further crimes of the defendant and to provide the defendant with needed educational or vocational training, medical care, or other correctional treatment. See 18 U.S.C. 3553(a). In the wake of Booker, the Supreme Court has further made clear that the guidelines cannot be used as a substitute for a sentencing court s independent determination of a just sentence based upon consideration of the statutory sentencing factors. Nelson v. United States, 129 S. Ct. 890 (2009), 2009 WL (Jan. 26, 2009); Spears v. United States, 129 S. Ct. 840 (2009). The Guidelines are not only not mandatory on sentencing courts; they are also not to be presumed reasonable. Nelson, 129 S.Ct. at 892 (emphasis in original). Moreover, as the Supreme Court also recently reiterated, in imposing sentence, the punishment should fit the offender and not merely the 3

4 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 4 of 16 PageID# 173 crime. Pepper v. United States, 131 S.Ct. 1229, 1240 (Mar. 2, 2011). II. A Sentence of 20 Months Is Warranted Under The 3553(a) Factors A. Personal History of Tyler Harber Tyler Harber is a 34 year old father of two children who grew up in a small, rural community in Tennessee. For much of his childhood, Mr. Harber was raised on his parents farm where he worked with his parents tending to the livestock, and spent his free time participating in the local boy scout troop and playing sports. Multiple letters submitted from family and friends from his childhood community describe Mr. Harber in fond terms as a bright child, a hard worker, loyal to his family, and dedicated to his boy scout troop. See, e.g., Letters of, appended under Exhibit 1. See also PSR, From the letters of those who know him from his childhood, it is clear that he was expected to accomplish great things. Notwithstanding an idyllic childhood growing up on the family farm, circumstances changed drastically for Mr. Harber s family during his late teenage years when his parents experienced financial ruin. By that point in time, the family had moved to Knoxville where his parents started and ran a nuclear energy company whose biggest client was Enron. When Enron collapsed in 2001, so did the Harbers company. In the aftermath, his parents lost or were forced to sell all of their business and personal assets, including their retirement savings. PSR, 78. It was a difficult time for Mr. Harber, not simply because his parents could not afford to pay for his college tuition, but because he hated to see his parents suffer. This period of his life appears to have had a long-lasting impact on Mr. Harber. At a relatively young age, he resolved to go it alone, and provide for himself so as not to add any additional burden on his parents. After leaving college, where he had studied political science, he 4

5 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 5 of 16 PageID# 174 found paying jobs in political campaigns. He then used those experiences to launch a career in political consulting, first with established firms, and later started his own consulting group. PSR, Always a hard worker, Mr. Harber s drive to succeed grew as he gained more and more name recognition in his chosen field. All of his early success came to an abrupt halt with his prosecution in this case. Mr. Harber shut down his political consulting business at the end of 2014 in advance of his preindictment plea. PSR, 97. He has been unemployed since that time. Mr. Harber met his wife, Cristin, in The two married in 2010, and have two children, a 3½ year old daughter and a 1½ year old son.. Mr. Harber also suffers from serious, chronic medical conditions.

6 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 6 of 16 PageID# 175 Notwithstanding his failures in this case, the letters submitted to the Court on behalf of Mr. Harber from family and friends make clear that he is a loving, dedicated father. As one family member aptly wrote, Tyler is not one to do things halfway, so his dedication to his family is his number one priority, and he takes that very seriously. Ex. 1, Letter of D. Thacker. Several of the letter writers who are currently close to Mr. Harber attest to the remorse which he has expressed for the burdens he has placed on his wife and children for his own misdeeds. Not only is he generating no income for the family, he recognizes that he has placed then in a situation where they must function without him for an extended period of time. See Letter of M. Robinson ( He has expressed to me his deepest regrets about the offence [sic], particularly the repercussion it has on his family ); Letter of A. Rivers ( He has expressed several times how remorseful he actually is. I think he feels he has shamed his family...once a happy, go getter is now a silent and depressed man ). For someone already diagnosed with depression, Mr. Harber has admittedly struggled over the last six months as he works to make amends to his family and figures out how to be productive again. While he committed serious conduct, it is also true that he has unequivocally accepted responsibility for his misconduct, and in so doing, made clear that his family is his first priority. B. Nature of the Offense Mr. Harber committed the instant campaign finance offense in 2012 while serving as a campaign manager during a congressional race in Virginia. He used money raised by a supposed independent super PAC, in which he was surreptitiously involved, to buy and run advertising against his candidate s political opponent in the congressional race. In short, he illegally coordinated the spending of super PAC funds, required by law to run independently of any candidate, to benefit his 6

7 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 7 of 16 PageID# 176 own candidate as well as himself. Mr. Harber admittedly compounded his wrongdoing by lashing out a political operative who suspected the illegal coordination, and also by lying to FBI agents about his coordination efforts when they questioned him several months later. He has accepted responsibility for his misconduct, and pleaded guilty preindictment to both unlawful coordination and making false statements. With his plea, Mr. Harber s once-promising career as a rising political operative is over. He has been unemployed since last year, and the family relies on his wife s earnings for income. He and his wife face crippling credit card debt and have an overall negative net worth. PSR, 108. As such, with his actions, Mr. Harber has not only ruined his professional reputation but his family s financial well-being as well. Beyond any sentence imposed by this Court, these are heavy burdens that Mr. Harber must bear. Notwithstanding his wrongdoing and his effective banishment from his field, several business associates and colleagues have written letters to the Court on Mr. Harber s behalf. They describe Mr. Harber s commitment to mentoring young people, and helping them get established in the field. See Letters of McShane, Winters, Newman, and Rivers, appended under Exhibit 1. Describing Mr. Harber s efforts to mentor his son, Mr. Winters writes, To this day, despite Tyler s mistake, my son holds him in the highest regard - and I am indebted to him. Ex. 1, Winters Letter. In his letter, Mr. McShane describes in detail the steps that Mr. Harber took to help him get established as a political consultant: After learning that I hadn t been able to secure a large campaign that I had been hopeful to sign as my client, Tyler suggested that I take several of his meetings and sell my services knowingly losing out on potential clientele, his first concern was for me and my career. Ex. 1, R. McShane Letter. 7

8 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 8 of 16 PageID# 177 Another colleague, a former candidate whose campaign Mr. Harber took a chance on, asks the Court to see Mr. Harber as he does, ultimately flawed but generous, and worthy of a second chance. Ex. 1, Letter of Clements. It is telling that these colleagues were willing to write to the Court on his behalf notwithstanding Mr. Harber s current pariah status in the industry. C. The Sentencing Guidelines & The Need To Avoid Unwarranted Sentencing Disparities The applicable guideline governing campaign finance offenses is 2C1.8, which sets a base offense level of 8, and then measures the harm of the offense by the total amount of the improper transactions, as determined by the loss table under 2B1.1. In this case, Mr. Harber has been assessed a 14-level enhancement for over $400,000 in illegal expenditures, based on approximately $300,000 in illegally coordinated expenditures by the PAC as well as expenditures for his personal benefit. 3 The guideline s treatment of unlawfully coordinated expenditures as straight economic loss, as determined by 2B1.1's loss table, is arbitrary and not based on empirical data. For better or worse in fraud and theft cases, the loss table is the method by which the guidelines quantify loss to the victims caused by a defendant s misconduct. In this case, however, there was nothing illegal about the fact that the super PAC spent money on advertising to support a particular candidate. The illegality stemmed from the fact that the expenditures were unlawfully coordinated between the campaign and the PAC, which was required to act independently. Thus, in an illegal coordination case, equating the amount of improper expenditures to victim loss is arbitrary, and the Court should not give great weight to the extent of the resulting guideline enhancement. 3 Under the Sentencing Commission s amendments to the loss table expected to take effect in November 2015, the current 14-level enhancement will be reduced to a 12-level enhancement, which, applied here, would lower the advisory guideline range to 37 to 46 months. 8

9 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 9 of 16 PageID# 178 Against the backdrop of the advisory guideline calculation, the Court must also consider the dispositions of other federal campaign finance and related cases in determining an appropriate sentence for Mr. Harber. As set forth more fully below, a sentence of 20 months in this case is appropriate in light of sentences in comparable cases and thus avoids any unwarranted sentencing disparity. While this case represents the first unlawful coordination prosecution, there have been a number of straw donor, or conduit contribution, prosecutions which are relevant to the disparate sentencing analysis here. Such conduit contribution cases generally involve defendants who have raised money for candidates through straw donations of friends, family, or business colleagues whom the defendants then reimburse, as a way to evade the legal limits on individual campaign contributions. Beyond general concerns of transparency in the electoral system, straw donor cases raise additional concerns not present in a coordination case such as the instant matter - concerns that individual fundraisers are attempting to curry favor with or gain inappropriate access to a candidate. Yet even with such concerns, straw donor cases are sometimes resolved civilly, not criminally, by the FEC. See, e.g., Apex Healthcare, Inc. And James Chao (Matter Under Review 5405) (2005) (company fined $275,000 in FEC investigation which found that its President, Chao, improperly reimbursed $69,500 in campaign contributions). Even when criminal prosecution has occurred, those individuals prosecuted have often received probationary sentences without incarceration. See, e.g., United States v. Mobley, 12-cr-150 (M.D. Fla. 2012) (defendant who reimbursed straw donors for approximately $100,000 in contributions sentenced to three years of probation and $200,000 fine); United States v. Winn, 11-cr- 9

10 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 10 of 16 PageID# (D. Mass. 2011) (imposing sentence of 1 year of probation and fine for defendant who reimbursed family members for contributions); United States v. Avanzato, 08-cr (D.P.R. 2008) (defendant who pleaded guilty to scheme to reimburse approximately $100,000 in conduit campaign contributions sentenced to probation and a fine); United States v. Collier, 07-cr (D.D.C. 2007) (sentencing lobbyist to probation and community service in connection with a scheme to contribute $65,000 in conduit contributions on behalf of lobbyist s client); United States v. Boucher, 06-cr (D.D.C. 2006) (sentencing defendant who made approximately $50,000 in illegal campaign contributions to one year of probation and $50,000 fine). In straw donor cases where custodial sentences have been imposed, the conduct has been deemed aggravated in some respect, and even some aggravated cases have resulted in home detention or community confinement rather than incarceration: United States v. D Souza, 14-cr (S.D.N.Y. 2014): well-known political commentator sentenced to probation and 8 months of community confinement for straw donor reimbursements; the defendant was denied acceptance of responsibility and made multiple post-plea statements to media that he had been selectively prosecuted. United States v. Danielczyk, 11-cr (E.D. Va. 2013) (Cacheris, J.): defendant directed extensive conduit contribution scheme and engaged in post-investigation efforts to conceal unlawful reimbursements by creating back-dated, fake invoices and issuing phony bonus checks, among other obstructive conduct. This defendant also pleaded guilty on the eve of trial, and was denied credit for acceptance of responsibility at sentencing, resulting in a guideline rage of 63 to 72 months (capped 10

11 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 11 of 16 PageID# 180 at 60 months based on the conspiracy charge). The government requested the mandatory minimum sentence of 60 months. The Court imposed a sentence of 28 months of incarceration. United States v. Magliocchetti, 10-cr-286 (E.D. Va. 2010) (Ellis, J.): founder of a lobbying firm engaged in one of the largest federal campaign finance frauds in history (Press Release, U.S. Department of Justice, January 7, 2011), directing a massive conduit contribution scheme over the course of five years in an effort to increase his firm s influence among its clients and elected officials, and later taking steps to cover up the illegal activity when questions were raised. The advisory sentencing range was calculated at 46 to 57 months, equivalent to Mr. Harber s range, and the government sought a sentence at the high end of the range of 57 months given the breadth and scope of the defendant s misconduct. The Court imposed a sentence of 27 months of incarceration. United States v. Raffol, 10-cr (D. Mass. 2010): defendant who was involved in conduit contribution reimbursement scheme for employer ultimately pleaded guilty to concealing material information from a federal agency and witness tampering. The latter charge was based on the defendant s attempts to get a witness to lie to investigators and conceal information. The defendant was sentenced to 1 year of probation and 3 months of community confinement. United States v. Mitchell, 06-cr-0049 (D.D.C. 2008): owner and CEO of government contracting business engaged in a large-scale scheme to commit bribery and to use corporate funds to reimburse straw donors for campaign contributions to candidates 11

12 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 12 of 16 PageID# 181 from whom the defendant then directly sought appropriations funding. With a guideline range of 9 to 11 years (based also on separate bribery conduct), this defendant was sentenced to 2½ years (after a 5K1.1 reduction). These myriad cases justify a sentence of 20 months for Mr. Harber in order to avoid unwarranted sentencing disparities. Mr. Harber acknowledges that his conduct is more serious than that of first-time offenders who received non-custodial sentences for relatively non-aggravated conduit contribution schemes. It is respectfully submitted, however, that his conduct is deserving of a lesser sentence than those imposed in the Danielczyk and Magliocchetti cases in this district. In contrast to Danielczyk, who pleaded guilty on the eve of trial, faced a guideline range greater than 5 years and ultimately received a sentence of 28 months, Mr. Harber pleaded guilty to an information early in this case, accepted responsibility for all of his misconduct, and did not force the government to expend significant resources litigating the case or preparing for trial. With respect to Magliocchetti who was sentenced to 27 months of incarceration, Mr. Harber s fraudulent conduct affected a single campaign, was far less substantial in scope than that of a defendant whose conduct was characterized by the government as one of the largest federal campaign finance frauds in history. (January 7, 2011 DOJ Press Release.) Although not a campaign finance case, the sentence imposed on former Governor McDonnell is also worthy of note. See United States v. McDonnell, 3:14-cr (E.D. Va. 2014). Facing a final guideline range of 78 to 97 months, McDonnell received a sentence of only 24 months, a huge variance. McDonnell ultimately was held accountable for receiving approximately $100,000 in payments from a wealthy constituent in exchange for the performance of official government acts. 12

13 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 13 of 16 PageID# 182 He not only went to trial but also testified, although was not given an enhancement for obstruction of justice. The top elected official in the Commonwealth of Virginia at the time of the offense, Governor McDonnell received a sentence of 24 months, more than 4 years less than the sentencing range, not merely for allowing money to influence and corrupt the political process, but for selling the Governor s Office to a friendly bidder. It is respectfully submitted that the relative positions and relative power of Governor McDonnell and Mr. Harber weigh in favor of a more lenient sentence for Mr. Harber. D. The Need to Achieve Deterrence and Impose A Sentence That Provides Just Punishment And Reflects The Seriousness of the Offense It is often presumed that incarceration is necessary to achieve deterrence, and that the more incarceration imposed, the greater the deterrent effect. Social science research, however, has shown the opposite. Indeed, research has consistently shown that while the certainty of being caught and punished has a deterrent effect, increases in severity of punishments do not yield significant (if any) marginal deterrent effects. Michael Tonry, Purposes and Functions of Sentencing, 34 Crime & Just. 1, 28 (2006). Three National Academy of Science panels... reached that conclusion, as has every major survey of the evidence. Id.; see also Zvi D. Gabbay, Exploring the Limits of the Restorative Justice Paradigm: Restorative Justice and White Collar Crime, 8 Cardozo J. Conflict Resol. 421, (2007) ("[C]ertainty of punishment is empirically known to be a far better deterrent than its severity"). See also Gabbay, supra, at ("[T]here is no decisive evidence to support the conclusion that harsh sentences actually have a general and specific deterrent effect on potential white-collar offenders."). 13

14 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 14 of 16 PageID# 183 Mr. Harber has no prior criminal history, and has never spent a single day in custody. Given the many substantial consequences he has already experienced, admittedly due to his own misconduct, he does not need a signficant period of incarceration to be deterred. The same holds true for general deterrence. Those who work in politics will be just as deterred by the threat of prosecution as opposed to any particular sentence since prosecution alone is a career-ending proposition. No one gainsays the importance of transparency in our political system and the obfuscation caused by illegally coordinated expenditures. Under the circumstances of this case, a sentence of 20 months of incarceration vindicates these important principles. It represents a signficant sentence for a first time offender who pleaded guilty early and whose conduct was targeted at a single election as opposed to a massive, wide-scale operation. In this respect, the requested sentence constitutes just punishment when measured against the sentences imposed in this district in related campaign finance cases. 14

15 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 15 of 16 PageID# 184 CONCLUSION For the foregoing reasons, Mr. Harber respectfully requests that the Court impose a variant sentence of 20 months as the least amount of incarceration necessary to achieve the goals of sentencing in this case. Respectfully submitted, TYLER HARBER By Counsel, Geremy C. Kamens, Federal Public Defender By: /s/ Shannon S. Quill, Va. Bar No Assistant Federal Public Defender Attorney for Tyler Harber 1650 King Street, Suite 500 Alexandria, Virginia (703) (telephone) (703) (facsimile) Shannon_Quill@fd.org ( ) 15

16 Case 1:14-cr LO Document 21 Filed 06/11/15 Page 16 of 16 PageID# 185 CERTIFICATE OF SERVICE I will electronically file the foregoing pleading with the Clerk of the Court using the CM/ECF system, which will then send a notification of such filing (NEF) to: Mark Lytle Assistant U.S. Attorney 2100 Jamieson Avenue Alexandria, Virginia (703) A copy of the foregoing pleading will also be served by to: Carla Coopwood U.S. Probation Officer 401 Courthouse Square Alexandria, Virginia /s/ Shannon S. Quill Va. Bar No Assistant Federal Public Defender Attorney for Mr. Harber 1650 King Street, Suite 500 Alexandria, Virginia (703) (telephone) (703) (facsimile) Shannon_Quill@fd.org ( ) 16