Plano Federal Lawyers

Federal criminal law is complicated. Plano federal lawyers need to know substantive law, procedural rules, and frankly the local preferences of the judges to be the most effective advocates possible. Sadly, many attorneys show up in federal court underprepared and unable to get a good outcome for their clients. Here is how Evergreen Attorneys are different:

• We only practice federal criminal defense. No family law or DUI attorneys.
• We only employ experienced partner-level attorneys. No fresh-faced associates right out of law school.
• We are a boutique federal white collar law firm. Every decision is tailored towards providing exceptional criminal defense.

 

Plano meeting location – by appointment only: We do NOT accept mail or service at this location.
5465 Legacy Drive Suite 650, Plano, Texas 75024

 

A federal direct appeal is the primary method of challenging a district court’s rulings on issues such as U.S. Sentencing Guidelines, forfeiture, restitution, and evidentiary issues. The courts of appeals exist because judges make mistakes. Sometimes, these errors can be nuanced. Other times, a court can make a series of blatant and egregious mistakes that leaves can only be corrected on direct appeal.

Appeals are one of the most important tools a defendant has to ensure that they receive a fair trial and sentencing. In the James case, the Second Circuit recognized the fundamental unfairness of the trial court’s rulings and remanded for resentencing. If you or a loved one have been recently sentenced and are looking to appeal, contact the Plano federal appeals lawyers at Evergreen Attorneys today for a free consultation.

At Evergreen Attorneys, our Plano federal lawyers know that an appeal is often the last chance to get things right in a case. That’s why we make sure to stay up to date on all relevant case law developments. In today’s post, we are breaking down a recent example of an appeals court needing to step in and save the day.

In the case of United States v. James from the Second Circuit, there were a number of sentencing errors made by the district court that resulted in the court of appeals vacating the district court’s sentence, including the forfeiture and restitution orders, and remanding for resentencing.

United States v. James, No. 24-849-cr (2d Cir. Aug. 29, 2025)

(A case study in bad federal criminal defense lawyering)

Facts of the Case

James was indicted and convicted on federal charges of conspiracy to commit health care fraud, 18 U.S.C. § 1349, health care fraud, 18 U.S.C. § 1347, wire fraud, 18 U.S.C. § 1343, aggravated identity theft, 18 U.S.C. § 1028A, and money laundering conspiracy, 18 U.S.C. § 1956(h).

Sentencing took place over two days. “The first day of sentencing was, to say the least, confused and confusing.” The district court calculated James’ Sentencing Guidelines range of 168 to 210 months, and found the gains from the fraud totaled $63 million. These gains represented Jame’ total business revenues. The district court seemed to acknowledge that a $30 million reduction in the gain calculation might be appropriate since the revenues included funds that were legitimate.

The district court also applied a four-level leadership enhancement under U.S.S.G. § 3B1.1 and a two-level abuse of a position of trust enhancement under U.S.S.G. § 3B1.3. James objected to the enhancements which were dismissed by the court without discussion.

The court initially indicated that it would impose a sentence of 10 years. However, the government interjected that under the First Step Act, James’ sentence “could effectively halve the court’s sentence.” The court then stated that it would impose a longer, 12-year sentence “based on the court’s misunderstanding of the ability of the defendant to engage in programs and potentially halve his sentence.”

Without deciding on a prison sentence, the court then turned to the issue of forfeiture and restitution. Despite the court’s previous statement regarding a $30 million reduction in its gain calculation, the court imposed a forfeiture order of approximately $63 million. On the matter of restitution, the government proposed over $342 million due in restitution. James objected to the restitution calculations on the basis that the government failed to account for properly-billed claims, legitimate payouts, and double-counting.

With the sentence, forfeiture, and restitution still undecided, the court adjourned sentencing and requested further briefing from the parties.

On day two of sentencing, James reurged his position for a sentence of 10-years on the basis that the court could not rely on the possibility of the FSA time credits or rehabilitation to impose a longer sentence. The government responded in turn that a proposed 25-year sentence would be appropriate since the sentence would “effectively be cut in half” given good conduct time, earned time credits under the FSA, and upon successful completion of the Residential Drug Abuse Program (RDAP). Ultimately, the court imposed a 12-year sentence and explained that it had considered the reductions available to James in prison, including the benefit of spending more time on RDAP, home detention, and a residential reentry center. The court then imposed a $36 million forfeiture and $336 million restitution order. James objected to the calculations again, but the district court adopted the government’s position with no further explanation.

James appealed his conviction and sentence to the Second Circuit.

Potential First Step Act Time Credits and a Longer Sentence

The court first began by addressing the First Step Act, under which eligible prisoners can reduce their sentence by earning time credits for participation in recidivism reduction programming and activities. 18 U.S.C. § 3632(d)(4)(A)(i)–(ii).

On the first day of James’ sentencing hearing, the district court stated that it would give James a 12-year sentence, but it also explained that it had intended to give a 10-year sentence until the government stated that the First Step Act could potentially halve James’ sentence. This was not a permissible reason to extend James’ sentence.

When imposing a sentence in any federal case, the district court is required to consider the list of factors under 18 U.S.C. § 3553(a). Eligibility for earned time credits is not one of those factors and “disrupts the balancing Congress dictated in § 3553(a) by ‘expand[ing] relevant sentencing considerations beyond those enumerated.’”

Permitting a district court to increase a defendant’s sentence at the front end to account for potential reductions under the First Step Act would contravene Congress’s intent to allow a prisoner to earn a reduction in time to be served under the sentence that the District Court already found proper based on the § 3553(a) factors.

The court also accurately noted that a prisoner is not guaranteed any reduction under the First Step Act and that the decision to award time credits is discretionary and dependent upon successful completion of qualified programs.

The district court’s increased sentence also ran afoul of 18 U.S.C. § 3582(a) which prohibits a district court from lengthening a sentence to promote correction and rehabilitation. The Second Circuit held:

To summarize, we hold that district courts may not rely on the potential for earned time credit under the First Step Act as a stand-alone factor to enhance a defendant’s sentence. We also hold that a district court cannot lengthen a defendant’s sentence based on the BOP’s possible reduction of a sentence for participating in a rehabilitation program. We therefore vacate James’s sentence and remand for resentencing consistent with this opinion.

Judge Screws Up Sentencing Guideline Enhancements

Unfortunately for James, the district court’s errors did not stop with the FSA time credits. The Second Circuit also found that the court erred in its application of Guidelines enhancements that raised the offense level by six points.

Section 3B1.1(a) of the U.S. Sentencing Guidelines provides for a four-level enhancement “[i]f the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive.” The district court applied this enhancement over James’ objection without making any findings in open court about James’ role in the offense or the actual number of participants involved. The court further noted that the PSR offered nothing more than conclusory descriptions of James’ role and failed to specify the five other participants to support the enhancement.

The court next turned to the two-level enhancement under U.S.S.G. § 3B1.3 for abuse of a position of trust. This enhancement applies “only where the defendant had abused discretionary authority entrusted to [him] by the victim.” The district court determined the enhancement applied because James had individuals’ personal information related to health and status. However, James had no direct relationship–contractual or fiduciary–with the victims in the case.

Even though it appears there was insufficient evidence to support this enhancement, the court of appeals concluded that application of the two-level enhancement was improper for another reason. James was also charged with aggravated identity theft under 18 U.S.C. § 1028A. The Sentencing Commission has explicitly directed judges not to apply this enhancement to avoid double counting when charged with § 1028A.

James’ Guidelines range was initially calculated at 168 to 210 months imprisonment. Without the erroneous 6-levels of enhancements, James’ advisory Guidelines range would be 87 to 108 months. Accordingly, on remand for resentencing, the district court has been instructed to properly recalculate James’ Guidelines range before resentencing.

Forfeiture Must Be Tailored Only to Ill-Gotten Gains

With the sentencing errors addressed, the court of appeals next turns to the issues related to forfeiture and restitution. In doing so, the court “determine[s] whether the trial court’s method of calculation was legally acceptable, but [] will not disturb a district court’s reasonable estimate of the amount, given the available information.” United States v. Walters, 910 F.3d 11, 31 (2d Cir. 2018).

The basic principle of forfeiture is that it is only gross proceeds traceable to the commission of the offense. “Congress’s intent [is] that forfeiture proceedings be used to recover all of the [defendant’s] ill-gotten gains but not to seize legitimately acquired property.” United States v. Daugerdas, 892 F.3d 545, 548 (2d Cir. 2018).

The government argued that James should forfeit $63 million, but it acknowledged that figure represented James’ total business revenue. James countered that the amount should be limited only to the portion of his revenues actually attributable to the fraud. With little explanation, the district court simply accepted the government’s position and ordered restitution of approximately $63 million.

The district court erred in ordering James to forfeit a significantly higher amount that included legitimate revenue not traceable to his fraud. Without an adequate justification from the district court, the court of appeals held it must vacate the forfeiture order and remand with instructions for the district court to recalculate the amount of forfeiture owed, explain its methodology, make specific findings justifying the final amount, and exclude from its calculation all revenue derived from James’ legitimate claims. Again, the Plano federal appeals lawyers at Evergreen Attorneys know that forfeiture issues are complex and need to be addressed early on in a federal criminal case.

Restitution Must Only Be the Amount of Losses Caused by the Defendant’s Conduct

Finally, the court of appeals addressed the district court’s massive $336,996,416.85 restitution order. Under the Mandatory Victims Restitution Act (MVRA), restitution is mandatory to victims of conspiracy to commit health care fraud and wire fraud. 18 U.S.C. § 3663A(c). Review of restitution orders is highly deferential; however, restitution may be awarded only in the amount of losses directly or proximately caused by the defendant’s offense conduct. Restitution need not be precise, it must at least be supported by sound methodology.

According to the Second Circuit, the district court’s restitution order did not reflect a reasonable approximation of losses caused by James’ fraud because its methodology failed to separate legitimate from fraudulent revenue. In response, the government urged the court of appeals to ignore the methodological flaws. The Second Circuit was unpersuaded, stating that the “Government’s basic methodology appears barred by serious flaws that undermine our confidence in the causal connection between James’ conduct and the District Court’s final restitution amount.

The district court’s restitution order was also vacated, and on remand the court is instructed to determine restitution that reflects a reasonable approximation of losses directly and proximately caused by James’ conduct.

Plano Federal Lawyers- Takeaways from James

A whole lot went wrong during James’ sentencing. The experienced Plano federal lawyers at Evergreen Attorneys could have seen this coming.  The district court impermissibly lengthened James’ sentence based on irrelevant factors; it misapplied Guidelines enhancements that raised James’ sentencing range by six points; and the court applied improper methodology in calculating tens to hundreds of millions in forfeiture and restitution.

Fortunately, James had excellent appellate representation that brought these issues to the court of appeals in a cogent way that resulted in winning most every claim on direct appeal.

It is incredibly important to have the right kind of attorney assisting you at every stage of your case. Just because a sentence has been entered does not mean your case is over. In James’ case, his sentence was vacated and has been remanded with detailed instructions from the court of appeals. That means he still needs the help of capable federal criminal defense advocates to make sure he receives some measure of justice at resentencing.

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Contact the Plano Federal Appellate Lawyers at Evergreen Attorneys

The Plano federal lawyers at Evergreen Attorneys have the knowledge and experience to give you hope when the situation seems darkest. Contact us today for a free consultation by filling out a contact form. You can also call us directly at (303) 948-1489 or email us at [email protected].

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