While not a securities case, the decision of the United States Supreme Court in United States v. Booker will have a significant impact on criminal securities cases.
The decision rules that the federal sentencing guidelines are advisory, not mandatory. This is significant since the guidelines are a complex set of rules and tests which are used to determine sentences in all criminal cases. There is very little leeway in the guidelines, and for most cases, in particular the securities fraud cases, the guidelines result in extremely long sentences, longer than would be available in the state courts for the same crime.
The guidelines were designed to give uniformity to sentences across the country, but in doing so, they took away a judges discretion in sentencing. The guidelines raised the stakes for defendants, since there was very little room for departures from the guidelines. Given the harsh sentences, many defendants were forced to plea bargain, since the risk of losing after trial was increased by the lengthy sentences.
This article discusses the potential impact of the decision on past, pending and future cases.
