MONTGOMERY, Ala., June 3, 2007 -- Sentencing attorney for former Governor Don Siegelman, Susan James, filed documents in federal court last week outlining Siegelman's objections to the probation officer's presentencing report and says a sentence according to the guideline range would be "draconian."
The government's request for a 30-year sentence is beyond the guideline range and prosecutors have asked the judge to go beyond the guideline range to impose that sentence.
"The government asserts that Defendant Siegelman is deserving of and should receive a sentence of thirty years for the criminal conduct for which he was convicted... The United States asserts that thirty years imprisonment, a fine of $1,000,000, and an order of restitution of $5,239,495 is the most appropriate sentence in this case."
The U.S. Sentencing Guidelines are now advisory and not mandatory for the judge.
James says the "suggested guideline sentence and anything short of probation will violate his Eighth Amendment protection against cruel and unusual punishment. In the sentencing memorandum and at sentencing Siegelman plans to argue that other similarly situated individuals with similar charges received substantially less punishment. Further the counts of conviction give the uncontroverted facts do not warrant such a draconian sentence. Additionally, other Governors, including Bob Riley, have received campaign contributions from individuals they have subsequently placed on the CON Board. This was done in the case of Dr. Swaid Swaid who was appointed chairman by Bob Riley after having contributed to the Riley campaign...Based on a Criminal History Score of I, the suggested guidelines would be 41 to 51 months. However, defendant seeks a departure from the guidelines and a variance to probation."
However, in a supplemental filing filed at the same time James says the suggested guideline range is even lower, "Based on a Criminal History Score of I, the suggested guidelines would be 27 to 33 months. However, defendant seeks a departure from the guidelines and a variance to probation."
James says the sentence requested would be tantamount to a life sentence: "The defendant is presently 61 years old. Life insurance actuaries project his life expectancy to be between 72 and 75 years old. If the Court imposes the prison term suggested by the guidelines it will be equivalent to a life sentence."
"A variance from the guidelines to a term of probation would still reflect (a) the seriousness of the offense - Governor Siegelman will still have a felony conviction, will lose his license to practice law, has ended a life time successful political career, he, his wife and children suffered embarrassment and degradation, and financial hardship; (b) deterrence - these factors above are adequate for deterrence purposes; (c) protection of the public from further crimes. There is no possibility of recidivism, (d) needed educational, vocational, medical, or correctional treatment - none of these sentencing objectives are necessary in the instant case."
James says other option for the court include "Home Confinement and Community Corrections." She goes on to argue Siegelman is "vulnerable and will have difficulty in prison."
"As noted in the Presentence report Don Siegelman has held public offices in the State of Alabama for over 20 years. Two of these positions, Attorney General and Governor, place him at great risk if incarcerated. As Attorney General the defendant was the number one prosecutor in the State and was involved in high profile criminal cases. As a result of his efforts countless individuals went to prison and/or were kept in prison. This fact is well known. Governor Siegelman implemented numerous tough on violent crime initiatives. These included, but were not limited to, more limitations on work release, more restrictions on violent offenders, and personal intervention in certain high profile cases before the Alabama Board of Pardons and Parole."
"The climate in the prison system is anti-Don Siegelman. Even though the above involved State of Alabama inmates there are numerous state inmates with federal detainers who have or will enter the federal prison system. Defendant reserves the right to raise additional departure arguments in a sentencing memorandum and at sentencing."
"...The Court can look at what variances were given co-defendants...The 24-month sentence for Young, the 18-month sentence for Bailey, and the acquittal of Hamrick support a variance in this case. In the instant case a downward variance sentence would better serve the competing interests...than a guideline sentence would. Additional in a sentencing memorandum and at sentencing the defendant plans to present evidence of nationwide disparity among similar situated offenders with similar offenses who received substantially less time than suggested by the guidelines contained within the Presentence Report."
"...The defendant is a licensed attorney. He has been a public servant for 30 years. His only ability to now earn income is as a licensed attorney. The Court should consider a downward departure from the guidelines on equitable grounds given that he will lose his license to practice law."
Another objection to the report has to do with a check to Siegelman's wife Lori Allen related to the infamous purchase of a motorcycle:
"Paragraph 33 contains the statement "Bailey wrote a check from his personal checking account to Lori Allen, maiden name of Siegelman's wife. The personal check to Lori Allen was deposited into Siegelman's expense account from which he had drawn the $12,173,35 check to purchase the motorcycle on December 6, 1999."
The Government's case tried to show something sinister about the check being written to Lori Allen. Lori Allen never changed here name to Siegelman and therefore Lori Allen is her correct name. Proof of his will be provided the Probation Officer at the Probation Conference.
Lori Allen was a name commonly appearing on bank accounts and brokerage accounts. It was easier for Lori to do her work as a counselor to sexual assault victims without using the Siegelman name. A check in her maiden and correct name was nothing out of the ordinary. Nick Bailey of all people knew this. There is no way Governor Siegelman would have involved his wife in anything illegal. She lost an eye in a life threatening automobile accident involving a drunk driver. Governor Siegelman would never have involved his wife in a petty motorcycle bribery scheme when they both went through so much to save her life."
The filing from last week goes on to object to the probation officer's non-recommendation of a two level drop for acceptance of responsibility. James lays out the argument as follows:
"Siegelman was charged in a second superceding indictment in 34 counts. Only 32 went to the jury. The jury acquitted him on all but seven of those counts (Effectively over 94% of the allegations). Counts one and two were RICO conspiracy and the RICO. The RICO alleged 70 racketeering acts. The jury found that Governor Siegelman had committed none of these 70 alleged racketeering acts. In fact the jury made a determination on 101 separate counts and racketeering charges and acquitted him on 94 of them."
"He never denied the conduct relating to the Scrushy counts of conviction or the obstruction count but argued there was no Quid Pro Quo as to the Scrushy counts and no criminal intent on the obstruction count."
"...As to the Scrushy counts of conviction there is a significant dispute over the law and how it was applied in this case.,,"
"...The real issue is whether it was illegal to accept a contribution and turn around and reward the contributor a position or other benefits."
"If there is an agreement to do so a crime is committed. If there is no agreement no crime is committed. Nick Bailey testified that Siegelman pulled a $250,000 check out of his coat pocket after Scrushy left and in answer to the question "What in the world is he going to want for this, Siegelman replied, "The CON Board." There was no proof whatsoever in that testimony that the two of them had made a Quid Pro Quo deal in the private meeting."
"Siegelman admits that he and Scrushy met and he asked for a $500,000 contribution to the lottery. He admits he appointed Scrushy to the CON Board. He only denies that there was a crime committed because there was no Quid Pro Quo agreement. He states that even if Bailey correctly described the events outside the Governor's office, it does not describe a crime committed by a Quid Pro Quo agreement."
One of the major arguments against the probation office's report is "that inclusion of acquitted conduct is a violation of his Sixth Amendment right to have a jury determine guilt beyond a reasonable doubt on any enhancement that increases punishment."
"...In this instance Defendant was acquitted on the RICO counts and the jury never made a reasonable doubt finding on any monetary amount contained within paragraph 42. The Probation Officer is using these monetary amounts to calculate the guidelines. Further, by its verdict the jury spoke that there was only one bribe."
"The United States Supreme Court in Watts...and the Eleventh Circuit in United States v. Barakat....held that relevant conduct of which a defendant was acquitted nonetheless may be taken into account in sentencing for the offense conviction, as long as the Government proves the acquitted conduct relied upon by a preponderance of the evidence. Siegelman argues that the Government failed to prove the acquitted conduct by a preponderance of the evidence...."
Attorney Susan James quotes from the Booker decision which made the guidelines advisory not mandatory:
James also cites United States v. Vaughan....
"While the District Courts may take into account acquitted conduct in calculating a defendant's guidelines range, they are not required to do so. Rather, District Courts should consider the jury's acquittal when assessing the weight and quality of the evidence presented by the prosecution when determining a reasonable sentence..."
The court document says the monetary amounts used in the report are "not countable as they do not reflect criminal conduct attributable to Siegelman" nor proven by a preponderance of the evidence:
Alleged Relevant Conduct
"1) $500,000 Scrushy payment. This payment was not illegal as argued at trial because there was no Quid Pro Quo and Siegelman did not financially benefit."
"2) $9,200 motorcycle transaction. As outlined in cross-examination at trial this transaction was not illegal rather it was money Bailey paid Siegelman as the first installment on the purchase of the Siegelman motorcycle and therefore the amount should not be included for guideline purposes. The $9,2000 is being calculated as relevant conduct, and it is also the basis for the obstruction count. Therefore, the $9,200 amount should not be included under relevant conduct. To do so would constitute double counting."
"3) Young Money (PSI-Paragraph 32) $53,000 Bailey debt; $19,000 Bailey living expenses; $25,000 Hamrick BMW; $500,000 Waste Management Fee, $3,000,000 price from sale of Cherokee County landfill. Siegelman had no knowledge of any of these monetary transactions."
In the supplemental filing more related to the $500,000 is mentioned:
"It is clear that the primary distinction is that a bribe include a quid pro quo element and the payment of any unlawful gratuity does not. The Government's only attempt to prove bribes relates to the Scrushy counts of conviction. There is no way to stretch any other payments of money into bribes. It is ridiculous to attribute the $500,000 donation as a bribe."
"Richard Scrushy served on the CON Board for Governors Hunt, Folsom, and James. Scrushy had contributed handsomely to all of their campaigns and Fob James' debt of $205,593 was paid off after the election on January 18, 1995. (See Secretary of State Campaign Finance Disclosure Reports 1994-1995)."
"Governor Riley received money from Dr. Swaid Swaid who was subsequently appointed by Riley as Chairman of the CON Board. Those contributions were closer to a personal benefit since they are campaign contributions to the candidate as opposed to a contribution to a 501(c)4 non-profit foundation, the purpose of which was to educate Alabama's children."
The filing talks more deeply about the $3 million landfill sale.
"Young admitted that he bribed Phillip Jordan, the Probate Judge and the chairman of the Cherokee County Commission to get County Commission approval of a landfill permit. Jordan had known Siegelman before, since he was Probate Judge. Siegelman called him and said in an off handed way, they had a mutual friend (meaning Lanny Young) who had a project in Cherokee County and if there was anything he could do to help, he would appreciate it. Jordan's Grand Jury testimony at pages 26-27 to a question about whether or not Jordan knew any other mutual friend up there other than Lanny Young was as follows:"
"Jordan specifically denied in Grand Jury testimony at page 30 that Siegelman asked Lanny Young to pony up any money."
"In fact, in Jordan's Grand Jury testimony at page 15, he categorically denied using any influence whatsoever to get the landfill approved."
"The jury did not believe that was the case and found Governor Siegelman innocent. Jordan did not testify that the $3 million Young money from the sale of the landfill was based on a telephone call from Governor Siegelman. The jury did not believe that it was based on such a telephone call. The jury certainly believed, and it was absolutely true, that Young bribed Jordan. In closing to the jury it was argued that if a man (Young) would bribe a Probate Judge (Jordan), he could not be believed on any subject. The jury agreed with this argument and did not believe Young at all on any subject."
"The sale of the landfill was unrelated to the generic phone call to Jordan from Siegelman. Jordan did not testify to this. There is no evidence supporting the basis of Young's profit on the sale of the landfill, we do not know the cost basis in the landfill, nor do we know what it would have been worth without a favorable commission ruling. Young testified in substance at the trial that a Tillman owned 20% to 25% of the landfill and that there were 8 to 10 other owners. This fact alone supports the argument that $3 million should not be attributed under relevant conduct. He further testified that Hamrick, Scrushy, nor Siegelman had anything to do with bribing the Judge."
"Jordan testified he had nothing to do with the vote. In fact as chairman, Jordan could not vote. As chairman Jordan could not vote except to break a tie. Jordan's actions would have been no different absent the Young bribe..."
James argues the $500,000 fee paid to Lanny Young by others "may have been unethical but not a crime. Government Exhibit 132 is Young's June 29, 1999 Term Sheet whereby he was to be paid $500,000 if the State Department of Revenue gave Chemical Waste Management a favorable revenue ruling... The fee paid Young involved payment for legitimate work done..."
Also at issue is the claim by the probation officer that the Revenue ruling resulted in a $1 million loss to the state:
"Siegelman contends the State gained, not lost, as a result of this ruling, and that this amount is not attributable to him. He contends this position was supported by the trial evidence. Even Lanny Young admitted at trial that he had no evidence that the revenue ruling was immoral or illegal. The acquitted conduct was not proved by a preponderance of the evidence."
"First, the revenue ruling was the correct legal ruling. Also a March 26, 1997 letter from Thomas R. DeBray to Wade Hope, Esq (Def. Ex 62) set forth the correct legal arguments that Chemical Waste Management was not subject to be taxed. (Exhibit 7) The legal distinction that Mr. DeBray drew is that the tax was not due since the waste was treated outside rather than inside the Emelle Facility."
"In addition, when the favorable ruling was issued, Chemical Waste Management agreed to drop a $4,622 million Petition for Refund (Def's Ex 64). ..This Petition for Refund was well taken. Thus, (a) there was no loss to the State and (b) the State picked up $4,622 million, plus interest or well over $5 million. Jim Hayes who was ready to testify on this matter would have been a very powerful witness, but as it turned out, the defense did not need him to win this particular charge."
Regarding the $50,000 AELF contribution made by Waste Management used in the monetary calculations in the report the filing says:
"There is sworn testimony from William Thomas Harrington before the Grand Jury that when Chemical Waste hired Lanny Young there was no discussion about Chemical Waste contributing to the lottery (Grand Jury Testimony, pp. 20-21) Mr. Harrignton was the Regional Vice President for Waste Management. There was never any suggestion that a lottery contribution would cause the Department of Revenue to make a favorable decision. At page 21, Harrington testified:
"Mr. Matthew J. Miller, the Southeast Regional Vice President for Waste Management testified before the Grand Jury that the lottery contribution by Waste Management was not a bribe and that there was no agreement regarding it. In his Grand Jury testimony at page 12, he testified that he spoke to Siegelman, and after Siegelman explained that the lottery was to benefit education in Alabama, he agreed to make the contribution. He stated at page 12:"
"Finally, Young's testimony was merely that he was present when Waste Management presented the check. There was nothing unusual about the scenario and absolutely nothing illegal. This contribution was not illegal and not attributable under a relevant conduct theory."
"There was uncontroverted testimony that the G.H. Construction project would have been good for the State. That is exactly why Dr. Henry Mabry, Director of Finance for the State of Alabama, endorsed the project before sending it to the Governor. The Governor, in reliance of Dr. Mabry's conservative approach to the expenditure of State money, also endorsed the project. It was Nick Bailey, working without the Finance Director or Siegelman's knowledge, and Lanny Young who caused the $411,495 loss to the taxpayers of this State. The Government conceded in open court tht constructing warehouses was a good idea that would have saved Alabama taxpayers money."
"Governor Siegelman had no knowledge of this conduct. Even Lanny Young testified that Paul Hamrick was not involved. This amount is not remotely connected to improper or illegal actions on the part of Governor Siegelman..."
The filing goes on to say Siegelman was kept in the dark:
"The jury in this case rejected the "Government's RICO public corruption theory as evidenced by its verdict. The Government's anticipated suggestion that the jury had to have accepted its theory in its entirety (as alleged in the indictment) in order to convict on the Scrushy counts is erroneous. Common sense and logic divides the bribery count from the counts of acquittal...It is obvious Siegelman did not benefit from the lavish lifestyle enjoyed by Young, Hamrick's BMW, and Bailey's addiction to extortion or the money Bailey received. He did not participate and the evidence supported the fact he was kept in the dark..."
"...Political Motivation for Prosecution/Conflict of Interest"
"When considering a combination of factors supporting a departure in this case...one need look no further than the political origins of this case that were advanced by former Siegelman counsel David Cromwell Johnson, now deceased. "
"Johnson accused U.S. Attorney Leura Garrett Canary of advancing a political investigation for the benefit of her husband's clients and political allies. Siegelman realizes this argument was barred at trial but may now be considered under Title 18 USC SS3661."
"The issue for trial may well be whether the accused is guilty or not guilty...However, no such limitation exists for purposes of sentencing...In its Motion in Limine to Bar Defendant's From Presenting Testimony, Evidence or Argument Concerning Alleged Political Motivation for the Prosecution, the Government acknowledged the political overtures in this case by referencing Siegelman's attempt to obtain information pursuant to the Freedom of Information Act."
"The United Sates Attorney, in a press release, advised that she was removing herself from the case. Yet, the case was still prosecuted by her subordinates. Siegelman, through other counsel, has diligently tried to obtain through the Freedom of Information Act evidence that further documents and supports his contentions. Despite his request well over a year ago the material which has been deemed disclosable by the Department of Justice has not been provided. Siegelman plans to advance more on this argument at sentencing."
James says the "bribery and mail fraud convictions are atypical"
"The defendants bribery conviction is atypical and outside the "heartland" of normal bribery cases. There was no financial benefit to the defendant and Richard Scrushy did not deprive the citizens of the State of Alabama of anything. He served on the CON Board and provided benefits to the citizens just like he had done for former Alabama Governors Guy Hunt, Jim Folsom, and Fob James."
"The monetary amount used for guideline calculation purposes is excessive and the Court should consider departing because there is too little relationship between the defendant's role and the conduct used to determine the monetary amount...Defendant faces the same sentence as if he had personally benefited. A departure is appropriate under these circumstances."
Elsewhere in the filing it says, "The Government's effort to paint and prove a massive public corruption case failed." And then proceeds to bring up Jack Abramoff and money to the Riley campaign:
"The jury, after close to two weeks of deliberation rejected the RICO counts and disregarded in total the testimony of Lanny Young and Nick Bailey. The Hamrick acquittal represents what the jury thought of the Government's RICO case. It is clear the jury knew of Richard Scrushy's HealthSouth acquittal. The jury could not convict Scrushy without convicting Siegelman as the Scrushy counts on the $500,000 contribution mirrored Siegelman's. Siegelman received no personal benefit from the Scrushy donation and in fact used the Alabama Education Lottery Fund for the benefit of Alabama children. Therefore, the offense conduct is far less serious than the counts of conviction reflect."
"The Government has made much out of the fact that the Scrushy contributions to the Alabama Education Lottery Foundation was disclosed late. This Court should take judicial notice of the fact that late and amended reports are common. An inquiry with the Alabama Secretary of State will reveal the same. After the election the AELF's purpose and focus changed. It was no longer election focused. Pursuant to Richey v Tyson, 120 F. Supp. 2d 1298 (So. Dist. AL (2000), and by extension, the Alabama Election Lottery Foundation, a 501(C)(4), nonprofit entity was actually under no obligation to report contributions at all. Bob Riley, the Governor of the State of Alabama, received contributions that have been traced to Mississippi Indian Gambling Casinos. An amended late return was filed."
"It appears from a December 2002 email from Jack Abramoff to Mike Scanlon that they were working with someone who wanted Governor Riley to shut down the Alabama Poarch Creek operation and describes their involvement in Alabama politics. After all it states, "if you had not done what you did in Alabama [she] would have to spend millions over the next four years." The logical inference is that the unidentified "her" was using Abramoff and Scanlon to try to influence Riley [Governor?] to assist with stopping gambling in Alabama. The conclusion is for the benefit of Mississippi Gambling factions (This was part of Senator McCain's Report)"
"To be sure the late filing regarding the Scrushy donation was not evidence of a crime was the testimony of Ed Packard, an employee of the Alabama Secretary of State, where he acknowledged that to hide the source of a contribution it could have easily been broken down into several PACs making it less easily identified."
"Don Siegelman served our state as Secretary of State twice, Attorney General, Lt. Governor, and Governor, for a period spanning nearly 30 years. The IRS, FBI, and state investigators subpoenaed all financial records of Don Siegelman, his wife, Lori Allen, and his two children, Dana and Joseph, for the period beginning December 1994 through February 2004, including all checks written, all deposits made, and all investments. If Governor Siegelman had been involved in bribery or peddling influence for his own personal benefit, surely, one of these agencies would have charged him with a crime. They did not. In fact, the only charge of bribery that has been made doesn't even allege that Governor Siegelman benefited."
"It is clear that Governor Siegelman did far more good for the State of Alabama, than any harm that the Government alleged."
No Benefit to the Defendant
"Certain trial facts clearly support the defendant's position that he received no personal benefit from the Scrushy contribution of $500,000 to the AELF. Todd Beard, an employee of First Commercial Bank where the loan was secured testified tht the $730,000 loan was to the Alabama Education Foundation not a loan to Nabors or Siegelman. At that time Nabors had pledged $29 million in stock to First Commercial."
"The Presentence Report finds that Siegelman "benefited" from the AELF paying off its loan for which he was "jointly and personally liable." (PSI, Page 8, Paragraph 21-22). Siegelman did not sign the note jointly with the AELF; he was not primarily liable; he was only a guarantor. Thus, his liability was not absolute, but contingent, a distinction with a hoary pedigree in Alabama law..."
"Consequently, his liability would not have become absolute until and unless the primary obligator (AELF) defaulted, but it never did. Thus, Siegelman and Nabors did not "benefit" when the AELF paid off the loan. If Siegelman and Merv Nabors had benefited from the payoff and they did not include the income on their tax returns, they would also have been charged with tax evasion. This is a clear indicator that neither Siegelman nor Merv Nabors "benefited" from the discharge.
"Even in doing a substance/form analysis, that is, while the form of the transaction was a loan to the AELF, the substance of the transaction was a loan to Siegelman and Nabors, the result is the same. The testimony was that the bank was not looking to Siegelman (he did not even file an asset report with the application for the loan), but to Nabors, who was a millionaire and a substantial depositor with the bank....If the Foundation had defaulted and Merv Nabors refused to pay and if Siegelman had been asked to pay, Siegelman at that time had over $2 million dollars in his campaign account and could have simply written a check from the "Siegelman For Governor" account to pay the debt. Therefore, there was never any threat of personal liability.
"Monetary amount overstates seriousness of his conduct - no personal benefit. The amount overstates the defendants culpability..."
If the defendants or the government wish to file a response to any objection addressed by a written sentencing brief they have to file that response in writing with the court by June 12, 2007.