As I wrote on TalkLeft today, I spent a long time on the phone yesterday with Sara Burnett of the Rocky Mountain News discussing the upcoming Joe Nacchio sentencing hearing from a legal perspective. Here's her new article on how much time he is likely to get. I think it's pretty pointless to speculate on what Judge Nottingham will do. One of the issues, the amount of loss to be used for calculating the guideline sentence, is a technical and legal one. The other, whether the Judge should depart from the guidelines and impose a lesser sentence, is more subjective and one in which Judge Nottingham has some leeway. I outlined both here. In re-reading the Government's pleadings today, I'm struck not by how the prosecutors calculated the guidelines but by their argument that a sentence of 87 months, the top of the guideline range, is necessary to ""provide just punishment, to promote respect for the law, and to protect the public."
Any lesser sentence would send a message of tolerance of the egregious behavior proven at trial. The need to deter other corporate insiders from taking advantage of the material non-public information they receive as a result of their positions within publicly traded companies is critical.
A sentence to 70 months, the bottom of the guideline range, they argue, is insufficient for these purposes. The law requires judges to impose a sentence "sufficient, but not greater than necessary" to satisfy the objectives of sentencing. Too often, the public and the media toss around these numbers like they were cookies. They aren't. They represent years of a person's life. The difference between 70 and 87 months is almost a year and a half. To someone behind bars and his or her family on the outside, that's a big difference. I don't buy that a six year sentence conveys a message to the public that insider trading is tolerable -- or suggests to a corporate executive that he'll get off lightly if he illegally sells his stock -- while a seven year sentence sends the appropriate message. When combined with the fact that Nacchio's offense was a non-violent one and even the Government concedes he's not likely to commit a future crime, I fail to see how an 87 month sentence is necessary while a 70 month sentence is inadequate.