United States v. Bryan Laurienti
2013 U.S. App. LEXIS 19908
| 9th Cir. | 2013Background
- Laurienti, a stock broker, participated in Hampton Porter’s pump-and-dump scheme involving thinly traded securities.
- The firm promoted these securities, then discouraged resales, enabling conspirators to profit from artificially inflated prices.
- Laurienti engaged in unauthorized client trades and cross-trades, and the firm rewarded such activity with bonuses.
- He and others were charged with conspiracy to commit securities fraud and securities fraud under Rule 10b-5, with restitution ordered at sentencing.
- On remand for resentencing, the court edged up to a 36-month prison term and three years of supervised release, plus restitution and a two-level abuse-of-trust enhancement.
- Laurienti challenged the sentence, arguing lack of knowledge about Rule 10b-5, improper enhancement, mitigation handling, and other procedural issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Evidentiary hearing on knowledge of Rule 10b-5 | Laurienti argues for an evidentiary hearing | Laurienti contends he lacked knowledge of Rule 10b-5 | District court did not err; no right to hearing, evidence indicates knowledge |
| Abuse of trust enhancement under § 3B1.3 | Laurienti contends no position of trust | Laurienti claims lack of professional discretion negates trust | Laurienti held a position of trust; enhancement proper due to professional discretion and resulting abuse |
| Mitigation argument consideration | Court failed to attend to mitigation | Mitigation arguments warranted more weight | Court did consider § 3553(a) factors and mitigation; decision not to depart affirmed |
| Examination of unread materials and DVD | Court should have reviewed last pages and DVD | Materials were not persuasive or necessary | No plain error; court reviewed evidence and explained why materials wouldn’t change decision |
| Substantive reasonableness of within-Guidelines sentence | Sentence may be excessive | Different sentence might be reasonable; not illogical | Sentence within Guidelines; substantively reasonable given conduct and restitution status |
Key Cases Cited
- United States v. Sarno, 73 F.3d 1470 (9th Cir. 1995) (no general right to evidentiary hearing at sentencing)
- United States v. Reyes, 577 F.3d 1069 (9th Cir. 2009) (burden to prove lack of knowledge by preponderance of the evidence)
- United States v. O’Hagan, 521 U.S. 642 (1997) (willful violation required for Rule 10b-5)
- United States v. Contreras, 581 F.3d 1163 (9th Cir. 2009) (en banc: proper inquiry for abuse of trust; focus on position of trust and discretion)
- United States v. Santoro, 302 F.3d 76 (2d Cir. 2002) (broker occupies position of trust; disclosure of commissions and advice matters)
- United States v. Valencia-Barragan, 608 F.3d 1103 (9th Cir. 2010) (reasonableness of within-Guidelines sentence; willingness to consider § 3553 factors)
- United States v. Apodaca, 641 F.3d 1077 (9th Cir. 2011) (requirement to state reasons for sentence and consider arguments)
- United States v. Carty, 520 F.3d 984 (9th Cir. 2008) (en banc; guidelines sentence generally presumptively reasonable)
- United States v. Cope, 527 F.3d 944 (9th Cir. 2008) (substantive reasonableness review standard)