Legal News

Judge Frederic Block: A Good Draw For Cioffi and Tannin?

By Dan Slater

Remember those two indicted Bear Stearns fund manager guys we wrote so much about in June? After the indictment, the WSJ’s Amir Efrati profiled Judge Frederic Block, the EDNY judge appointed by Clinton in 1994 who was assigned to the trial. Efrati’s conclusion was this: In Judge Block, the Bear guys — Ralph Cioffi and Matt Tannin — may have gotten a good draw.

Actor Steven Seagal testifies as U.S. District Court Judge Frederic Block looks on, Feb. 11, 2003. In the Gotti trial, Seagal testified that the crew of alleged mobsters demanded that he make movies with them — or else. (Credit: AP/Jane Rosenberg)

Today, we’d like to marshal some more possible evidence on that front. Make of it what you will.

The NYLJ reports on the sentencing of two brothers who faced 30 years to life under federal sentencing guidelines for their roles in a securities fraud scheme. Instead, thanks to Judge Block, they received five-year sentences. In departing downward from the minimum recommended sentence by 25 years, Judge Block issued a 21-page sentencing opinion that’s critical of the guidelines’ “fetish with absolute arithmetic.”

Over at White Collar Crime Prof blog, Ellen Podgor writes that Judge Block, in the case of U.S. v. Parris, recognizes the importance of not using what he calls a “one-shoe-fits-all” approach when sentencing individuals. (Here’s more on the ruling from the New York Federal Criminal Practice blog.)

The case, which, wrote Block, involved “a rather typical ‘pump and dump’ scheme in the world of the high-risk penny-stock investor,” represents another example “where the guidelines in a securities-fraud prosecution ‘have so run amok that they are patently absurd on their face’ . . . due to the ‘kind of ‘piling-on’ points for which the guidelines have frequently been criticized.”

LB Readers: Clearly, a lot separates the case against Cioffi and Tannin from this “rather typical ‘pump and dump’ scheme.” However, Judge Block does make a distinction between well-known white collar defendants, such as Jeff Skilling and Bernie Ebbers, and lesser-known defendants such as the Parrises. Where might Cioffi and Tannin fall on the celebrity spectrum?

Full post as published by Law Blog - WSJ.com on August 15, 2008 (boomark / email).