In our recent post, “As Chevron Goes, So Goes the Sentencing Guidelines”, we discussed the possible ramifications the U.S. Supreme Court decision in Loper Bright might have on the Sentencing Guidelines going forward. Namely, whether, with the end of Chevron deference, federal courts must continue to even consider the Guidelines at all. But what about defendants that have already been sentenced? What relief might be available to them? The Court in Loper Bright made it clear that its decision is not retroactive, so sentences based on a trial court’s past reliance on/deference to Guideline commentary or the Guidelines themselves cannot be challenged. However, another Supreme Court decision, Corner Post, Inc. v. Bd. of Governors of Fed. Rsrv. Sys., 144 S. Ct. 2440, 2443, 219 L. Ed. 2d 1139 (2024) handed down around the same time as Loper Bright may, in some instances, provide relief to defendants that have been previously sentenced under Guidelines that have failed to comply with the notice and comment provisions of the Administrative Procedures Act (“APA”).
Corner Post, Inc. v. Bd. of Governors of Fed. Rsrv. Sys.
In Corner Post, the Supreme Court considered a facial challenge to Regulation II, promulgated by the Federal Reserve Board (the Reserve Board) in 2011, which set the maximum fee that an issuing bank could charge merchants for debit card transactions. Corner Post, a North Dakota truck stop and convenience store that opened in 2018, joined a suit against the Reserve Board under the APA. The district court dismissed the case as barred by the statute of limitations under the general federal statute of limitations, 28 U.S.C. § 2401(a), and the Eighth Circuit affirmed. A majority of the Circuit Courts at the time had taken the position that the limitations period for APA challenges begins to run, upon publication of the regulation. Thus, the statute’s six-year statute of limitations period began upon the publication of Regulation II in 2011 and expired in 2017, before Corner Post had begun operations.
However, in a 6-3 decision, the Supreme Court disagreed with the majority of Circuits, holding that under the general federal statute of limitations, an APA claim does not accrue until the plaintiff is injured by final agency action.
APA and the Sentencing Guidelines
Admittedly, when it comes to the Sentencing Guidelines, relief under the APA is limited. Congress has decided that the Sentencing Commission would not be an ‘agency’ under the APA when it established the Commission as an independent entity in the judicial branch and that the Sentencing Guidelines would not be subject to the provisions of the APA except as specifically enumerated. See United States v. Berberena, 694 F.3d 514, 527 (3d Cir. 2012) (internal citations omitted). However, when issuing Guidelines, the Sentencing Commission must comply with the APA’s notice and comment provisions, 28 U.S.C. § 994(x), and must submit the proposed Guideline to Congress 180 days before it takes effect, along with a statement of the Commission’s reasons for issuing the Guideline, 28 U.S.C. § 994 § 994(p) providing Congress, the ability to override the Guidelines by statute. Guidelines that do not comply with the APA’s notice and comment provisions are invalid. See Burkey v. Lappin, No. CIV.A. 06-122, 2007 WL 4480188, at *7 (W.D. Pa. Dec. 14, 2007).
Therefore, pursuant to Corner Post, Defendants now have six years from the time of sentencing (when they have arguably been injured by final agency action) to challenge their guidelines under the APA, namely, whether the Commission provisioned prior notice and comment of the proposed Guideline through publication in the Federal Register.
In Practice
In conclusion, whether the applicable Guideline Manual is the one in effect at the time the offense was committed or the Manual in effect at the time of sentencing, depends on the applicability of the ex post facto clause of the United States Constitution. Going forward, as defense counsel is deciding on the appropriate Guideline Manual, attention should also be paid to the applicable Guidelines’ compliance with the APA and potential challenges to their validity.
In Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244 (2024), the Supreme Court did away with the “Chevron Doctrine” essentially eliminating the Judiciary’s mandated deference to agency interpretations of ambiguous statutes. On the horizon, is what effect the Loper decision will have on the Federal District Court’s mandated utilization of the Sentencing Guidelines when sentencing defendants.
Over the past few years, I have had the good fortune to work on two high profile political corruption cases brought in the Eastern District of Pennsylvania. The Defendants in those matters John Dougherty (Local 98 Leader convicted of, inter alia, paying bribes to Philadelphia City Councilman Robert Henon) and Rahim Islam (CEO of Universal Community Homes convicted of, inter alia, paying bribes to a Milwaukee Public School official) were coincidentally sentenced within days of each other in July of this year. Both men were given significant sentences; Mr. Dougherty (6 years) and Mr. Islam (7 years). However, despite both Defendants putting the Government through its paces, both sentences fell well below what the Guidelines called for; Mr. Dougherty (11 – 14 years) and Mr. Islam (12 – 16 years).
Consistent with these two cases, federal judges have been reluctant to sentence Defendants within the Guidelines. In the years leading up to United States v. Booker, 543 U.S. 220, 125 S. Ct. 738, 160 L. Ed. 2d 621 (2005) wherein the Supreme Court demoted the Guidelines from mandatory to merely advisory, federal judges would bemoan the fact that their hands were tied at sentencing and that they would most certainly have handed down a lesser sentence, but for, the mandatory nature of the Guidelines. Since the Booker decision, federal judges have generally made good on those promises with a healthy majority of sentences handed down since Booker departing or varying downward from the guidelines. For example, in 2022, only 44% of sentences handed down were within or above applicable guideline range. (2022 Federal Sentencing Statistics)
Now armed with the Loper decision, Defendants will further chip away at the mandate that federal district courts must consider the guidelines at sentencing. With regard to the Sentencing Commission’s Commentary to the Guidelines, since the Supreme Court’s 1993 decision in Stinson v. United States, 508 U.S. 36, 113 S. Ct. 1913, 1914, 123 L. Ed. 2d 598 (1993), the court has held that the Commentary found in the Guidelines must be considered authoritative “unless it violates the constitution or federal statutes, or is inconsistent with, or a plainly erroneous reading of the Guideline.” The court in Stinson relied on Chevron in finding the commentary authoritative stating that:
Although the analogy is not precise because Congress has a role in promulgating the Guidelines, we think the Government is correct in suggesting that the commentary be treated as an agency’s interpretation of its own legislative rule. The Sentencing Commission promulgates the Guidelines by virtue of an express congressional delegation of authority for rulemaking and through the informal rulemaking procedures in 5 U.S.C. §553. Thus, the Guidelines are the equivalent of legislative rules adopted by federal agencies. The functional purpose of commentary (of the kind at issue here) is to assist in the interpretation and application of those rules, which are within the Commission’s particular area of concern and expertise and which the Commission itself has the first responsibility to formulate and announce. In these respects, this type of commentary is akin to an agency’s interpretation of its own legislative rules. As we have often stated, provided an agency’s interpretation of its own regulations does not violate the Constitution or a federal statute, it must be given “controlling weight unless it is plainly erroneous or inconsistent with the regulation.”
Id. (internal citations omitted). Thus, a fair reading of Loper as applied to the Commentary in the Guidelines, unbinds federal district courts from deferring to Guideline Commentary in interpreting the Guidelines.
With the Loper decision arguably eliminating a trial court’s deference to the Guidelines Commentary, what is then in store for the guidelines themselves? The Supreme Court’s mandate in Booker and subsequently in Molina-Martinez v. United States, 578 U.S. 189, 189, 136 S. Ct. 1338, 1339, 194 L. Ed. 2d 444 (2016) that trial courts consider the Guidelines at sentencing, and justifying that requirement based on the Commission’s “expertise” amounts to the functional equivalent of Chevron deference. With courts sentencing Defendants within the guidelines less than 50% of the time, perhaps it’s time for federal courts, relying on the Loper decision, to move away from the Guidelines once and for all.
