Complete Oral Argument for Bronfman: Judge Wrong on ‘Willful Blindness’; Gave Too-Long Prison Term

Clare Webb Bronfman, 43, is an heiress whose family made a fortune in the liquor business. She is also federal inmate #91010-053. She has an estimated net worth of $300 million.

 

Bronfman pleaded guilty to two felony counts: 1. conspiring to conceal and harbor aliens for financial gain. 2. Identity theft.

 

Before sentencing, Bronfman submitted a sentencing memorandum. It stated she had no connection to DOS. Bronfman included a letter telling the judge she did not disavow Keith Raniere.

 

She asked for probation.

 

The government’s sentencing memorandum stated Bronfman supported DOS. And she helped find sexual partners for Raniere. The government sought a 60-month sentence.

 

Bronfman sought a Fatico hearing. She wanted to present evidence that she did not have a culpable mental state about DOS. The judge declined to hold a hearing. Her sentencing was on September 30, 2020.

 

Before handing down the sentence, US District Court Judge Nicholas Garaufis spoke about DOS and her.

He said, “While she might not have known about DOS… she did not want to know either… She maintains that she was an innocent bystander… completely blind to Raniere’s crimes…. I find that any such blindness was willful and cultivated….

“Ms. Bronfman seems to have a pattern of willful blindness when it comes to Raniere…. she wanted to participate in Raniere’s world while remaining unaware of uglier aspects.”

Based on her lack of criminal history, sentencing guidelines were 21-27 months. The judge sentenced her to 81 months. This was triple the guidelines. Besides her prison sentence, she paid a fine of $500,000, restitution of $96,605.25, and forfeited $6,000,000.

She was not permitted to report to prison. She left the courtroom in handcuffs.

She served 19 months at the maximum-security Philadelphia Detention Center. Yesterday, the Bureau of Prisons transferred her to the low-security FCI Danbury. Her release date is June 29, 2026.

Bronfman appealed her sentence to the US Court of Appeals for the Second Circuit. She claimed that others convicted for the same crimes got sentences in the 21-27 month range. She argued her sentence should not be longer than Allison Mack’s three-year sentence. Or Lauren Salzman’s sentence of probation. Both women pleaded to more severe crimes.

 

On May 3, her attorney, Ronald Sullivan, appeared before the US Court of Appeals for the 2nd Circuit. Assistant US Attorney Kevin Trowel was Judge Garaufis’ de facto attorney. 

 

They were there to make oral arguments for and against a sentence reduction. Here is what they said. 

 

I will make [clarifications in bold and brackets.]

Judge Calabresi: Thank you very much. We’ll hear from Mr. Sullivan.

Ronald Sullivan: I’m Ronald Sullivan on behalf of Clare Bronfman, and today I’m asking the court to vacate the sentencing of Ms. Bronfman and remand to the District Court {Judge Garaufis]. Because it was procedurally unreasonable for three principal points.

First, your honor. The district court came up with this theory of willful blindness, and it was at least part of the reason why the court variated from the guidelines so much. To make the point here, it was an upward departure by 200%; [it] gave Miss Bronfman more than two years [more] than even the government asked for it. It was based in part on this erroneous fact.

Judge Calabresi: Counsel, I have terrible trouble with any of your arguments as to procedural error. But comment about willful misconduct.

Blindness even goes to the background of what she was doing. It wasn’t that he found that she was involved in the narrower and most vicious cult [DOS], it doesn’t go to that. It goes to general things.

It seems that most of your argument, all three parts, really go to the size of the sentence, in light of what the guidelines are, and the government’s request, and what people involved in it more seriously, [Mack and Lauren Salzman] crimes more serious than hers, actually got. Now, none of those are procedural things. But aren’t they the things we should look at to decide whether this sentence was substantively simply too high?

And the sentence was influenced by the fact that she had money, as you said, and that she used the money to help Raniere in his defense, which he has a perfect right to do. But isn’t that really what you’re arguing, rather than these procedures? They are very tough on saying something substantive. But if that’s the argument, I’d like to hear it.

Sullivan: That is certainly one of the arguments, and we would ask the court to vacate on any of those bases. But yes, the third basis is what the court just mentioned. The second just for the record as a notice argument, which I will return to, but yes, there was a there was grossly disproportionate sentencing compared to everyone else in the case.

Now, if the court will bear with me, I want to focus on codefendant Mack, codefendant Salzman, and then codefendant [Kathy] Russell. With respect to co defendant Mack, the court said quote, “Her cruelty lies in manipulation, apparent sadistic pleasure in watching DOS members suffer, and her creative enthusiasm in developing new ways to debase them and chastise on that basis.”

Judge Sullivan: Mack was a cooperator, right?

Sullivan: Mack is a cooperator.

Judge Sullivan: How is Mack similarly situated with your client?

Sullivan: She’s different from my client. That is our point. The court found that she engaged in some of the, in the courts words, helped Mr. Raniere implement some of the most twisted manipulative–

Judge Calabresi: Counsel, that can’t go to procedural error, because we have said 1000 times that what is done with respect to a coconspirator is not procedurally relevant. And certainly, the fact that somebody was a cooperator makes her different. So again, it may go whether the sentence is in the range of possible, but I don’t see how it raises any procedural question.

Sullivan: Well, this can be a strictly 3553 A6 argument here, because with respect to co defendant Mack, she received 80% lower than the guideline range with respect to co defendant Salzman, no time at all. The closest my client, Ms Bronfman, is Russell.

Russell was a nonviolent first time offender. Ms. Bronfman, nonviolent first time offender.

Russell was a non-cooperator. Miss Bronfman was a non-cooperator.

Russell was not involved in DOS. Miss Bronfman was not involved in DOS.

Miss Russell got zero time, no time. Miss Bronfman got nearly seven years.

So in terms of the statutory requirement, that there not be an unwarranted sentencing disparity, we have a clear case here, based on the relative culpability of all involved.

Judge Sullivan: Russell’s guidelines were six to 12 months, right?

Sullivan: Russell’s were six to 12 months, and it was departed down to zero. Ms. Bronfman’s was 21 to 27 months – 200% upward departure to 81. Those two are pretty similar in terms of what their relative culpability is. The only difference runs us back into this question of willful blindness. And I will say Judge Calabresi in terms of the procedural questions. There’s also an important notice question that I just want to raise to this court. I think my time is up, may I finish the point? An important notice point.

Fundamental to the criminal justice system is the notion of notice. The accused has to have notice of what she is being punished for, and an opportunity to respond.

The first time this notion of willful blindness came before anybody was when the judge pronounced the sentence. Pretrial didn’t mention it. The government never argued. And certainly we didn’t. It was at this moment of sentencing that the district court put in this notion of willful blindness. There was no notice. It was indisputably a basis for the court’s decision. And this circuit and others have said it is a basis of decision that we have to have notice. Ms. Bronfman must have notice and the ability to respond.

Judge Sullivan: But you’re quibbling with the characterization or the use of a phrase. But the facts referenced by that phrase were pretty well explained by Judge Garaufis, right? He basically gave an upward departure because he found that your client, in his words, so demonstrated an allegiance to Raniere, whatever the cost, whomever it hurts. That was relevant to the 3553 A factors.

That she was basically, even when she learned of Raniere’s more egregious conduct, she doubled down, as he described it. Those facts weren’t new. Those were all based on facts that were well before both parties, right?

Sullivan: Absolutely not. The use of willful blindness,

Judge Sullivan: Never mind willful blindness. That’s a phrase that I think you’ve injected a lot of meaning into. I’m saying the fact of her doubling down on Raniere. Of her hurting folks who chose to criticize NXIVM. That’s what Judge Garaufis was talking about as the basis for his upward departure.

Sullivan: Absolutely not. The court said, and I quote, “While she may not have known about DOS before receiving the emails on September 27,” so he’s referencing the time when DOS was existent.

Judge Calabresi: Counsel. Counsel, suppose the court had given a sentence of 34 months. Somewhat upward departure, not that much. And you’ve used the terms willful blindness, would you be talking about that here?

Sullivan: It would be obviously-

Judge Calabresi: A procedural error, it doesn’t matter how much the change in sentence is made. If it’s not a procedural error, then it’s something else. But would you be making the arguments you are making about notice, about this, about bananas, about the other thing, if a sentence had not been as severe?

Sullivan: On this part of the argument? Yes. If it had been 34 months, if it had been anything over the guidelines, yes. The district court is not allowed to rely on an erroneous fact in order to pronounce the sentence, and Ms. Bronfman will have had notice.

So I think no matter what the upward departure was, yes, we would be here. The fact that it is so exaggerated really speaks to the justification needed in order for that sentence to remain valid.

This circuit has said that the greater extent of the variance from the guidelines requires a more meaty justification.

This is why Judge Sullivan, I am pressing this willful blindness point. I don’t think it is an errant phrase. The court speaks to the period of time before [DOS] it became publicly available. And the court says she maintained she was an innocent bystander to Raniere’s abhorrent conduct, completely blind to his crimes and the sex trafficking that occurred within the NXIVM community.

As I have said, [quoting Garuafis] “I find any such blindness was willful and cultivated,” and “Ms. Bronfman can and should serve to deter other people who find themselves in situations in which they can choose either to confront or avert their gaze from the harm brought by their actions and the actions of those to whom they are close.”

That has absolutely nothing to do with the after the fact portion of the judge’s opinion. And I do admit that that’s one of the bases. This has to do with his finding that during the time of the existence of DOS, she was willfully blind to it, and that her sentence, quote, “Can and should serve to deter others,” who are in that similar situation. And that’s why it was relevant. We never had an opportunity to respond to that. And in fact, we brought up this notion of mens rea, because we asked for Fatico [hearing] based on the fact that the –.

Judge Calabresi: That’s a question I very much wanted to put to you before you sat down. It’s not clear to me, at least based on your briefs, that you challenge the district courts, September 24, 2020 order denying your motion for a Fatico hearing. That is, Judge Garrafus did deny your motion for Fatico hearing. But you didn’t make anything of it before [you did to] us. Is that right?

Sullivan: Before this court?

Judge Calabresi: Yeah.

Sullivan: Correct, Your Honor, we’re not challenging. That’s not the basis of this appeal. I raised that to say that we, when we attempted to talk about the mens rea, because of a sentence in the pre sentence report that we thought was horrifically wrong. The court said, no.

It’s fundamentally unfair to then say, well, I’m going to use her mens rea in order to enhance the sentence.

Our point is that you can’t have it both ways. If her mens rea is one of the reasons that the district court enhanced the sentence, then fundamental notice requirements. The most basic notice requirements suggest that we ought to have an opportunity to respond to that and we absolutely did not.

Judge Calabresi: Thank you very much, Mr. Sullivan. I’ve given you almost three times as much time as originally envisaged. But you will have one minute rebuttal for reserve.

Sullivan: Very well. Thank you.

Trowel: Good afternoon, your Honors. May it please the Court, Kevin Trowel for the United States. I’ll be addressing the arguments raised by counsel for Clare Bronfman. Here, as in Ms. Bronfman’s briefs, counsel focuses largely on the term willful blindness.

I think, as the government has argued in our briefing, counsel has imbued that term with a meaning that simply isn’t present in the judge’s opinion.

And I think that’s apparent from a fair reading of the opinion which references on no fewer than six occasions, that the judge was not holding Ms. Bronfman legally culpable for DOS.

Judge Calabresi raised a question about whether Ms. Bronfman’s argument is about substantive unreasonableness. And I think there are a few important responses to that.

One, the court’s standard in that regard [is that it] shocks the conscience. It’s a very difficult standard to meet. And one may fairly ask whether it could be met if the defendant’s conscience wasn’t so shocked, and therefore she didn’t raise it in her own brief.

But I think putting that aside and putting the parties’ arguments aside with the party presenting rule is potentially a good reason for this. I’m certainly not in counsel’s head, but the kind of visa fraud crimes, 1324 crimes, that are most analogous to Clare Bronfman’s crimes, are not, for example, where an individual drives to the Canadian border, picks up somebody, and drives them back to New York City in exchange for $1,000.

There are a number of cases on this Court’s docket, charging the statutes that Ms. Bronfman was charged with that involved facts like that. This is not that case. This is far more analogous to cases like Vargas Kordon 733, F 3366, or Sab Hnani. Those are cases where the fraud is part of a broader scheme that involves a form of servitude. And those cases are far worse. There’s no question.

So in Vargas Kordon, there was sex abuse, in Sab Hnani, there was physical abuse, but the sentences were also appropriately higher. So it was 120 months, and Vargas Kordon, 132 months and Sab Hnani, there were other crimes. They’re certainly in other context.

But what Judge Garaufis focused on here is that the kind of crime the defendant committed was far from a run of the mill visa fraud. And it involved a form of servitude that led these individuals to come to the US based on promises she made. They were unpaid. They were in precarious financial positions, they were emotionally manipulated by Ms Bronfman among others, and her callousness to that played a significant role, no question in the judge’s decision, and quite fairly.

Judge Calabresi: The government counsel. The government itself only suggested a sentence which was above the guidelines, but well below this one. And Judge Garaufis seems to focus on things like the fact that she used her considerable more money, which I don’t think is relevant. Whether somebody is rich or poor doesn’t make any difference, to pay for this guy’s defense. Now, isn’t it shocking to have a sentence go up because somebody chooses to use her money to help pay the defense of an absolute scoundrel?

Trowel: Respectfully, Your Honor, I think that question makes an error similar to the one that Clare Bronfman’s counsel makes in the brief, which is to suggest that any one point drove the court sentence. And I think that’s simply not borne out by a fair reading of the court’s opinion, which is both lengthy and detailed.

And it’s also I think, in addition, quite careful to compartmentalize the factors the court’s considering: the seriousness of the crime, the characteristics of the defendant, and to cabin those in the places they belong. I think, your honor, it’s not quite accurate to say that she was punished because of her wealth. And in fact, Judge Garaufis expressly said, “There’s of course, no problem with wealth. That’s not the issue here.”

But what is at issue and what is fairly considered as a part of the defendant’s history and characteristics are the way she used the wealth in furtherance of the activities of the enterprise, and Keith Raniere in particular, in ways that as the court also fairly found in that aren’t contested on appeal, led to and certainly contributed to some of the criminal activity that we’re seeing that was proven at trial, including the crimes that she herself participated in.

I think the point about whether her paying for the defense is salient insofar as it was relevant, as it related to the Court’s conclusion that Ms. Bronfman had failed to see the error of her ways, even after trial.

So part of the argument, and this goes to the point about willful blindness, and what I think the court intended here. She made a point at sentencing. I think she makes this point in her appellate brief, that she was unaware of all the details. That was true to a point. But beginning in 2017, when she became aware of DOS, those details were available to her. And certainly after trial, the world was aware of those details.

They were made public every day, and the horrors of Keith Raniere’s treatment of members and victims of the enterprise were known to all.

Still, at sentencing her position was not, “I’m sorry, I made a mistake. I now see this,” but rather “I support him, he changed my life for the better.” And that too was a point, not the most important point, but a point in the constellation of points that Judge Garrafus relied on in imposing a sentence, as he did of 81 months.

Judge Calabresi: Thank you very much.

Trowel:Thank you.

Judge Calabresi: Mr. Sullivan you’ve reserved a minute.

Sullivan: Thank you, judge. So first, I will address Judge Calabresi’s point. Yes, clearly, Ms. Bronfman was punished for her wealth. It is spread throughout the transcript, comments about her wealth, her privilege. Clearly, that was part of the punishment, to the extent that’s a substantive due process violation. It does shock the conscience, it shocks my conscience.

Judge Sullivan: Well, I’m not sure it shocks mine. So explain this to me. So, if you have tremendous wealth, and you use that to destroy the enemies or people opposed to what ends up being a RICO enterprise, that’s not something that the court should or can consider?

Sullivan: It’s an erroneous fact that Ms Bronfman used her wealth to destroy the enemies of a RICO enterprise. In fact, the record shows that most of the lawsuits Ms. Bronfman engaged in, she won.

[That is not true. She lost most of her lawsuits, as we can prove in a subsequent post.]

The notion that she abused people is simply factually untrue and sort of clever syntax. And the government’s brief does not change that fact. If I may, the government mentioned Vargas Kordon in the brief. And they took to justify this exaggerated sentence because it goes to the government’s forms of servitude and abuse.

I would remind the court that Ms. Bronfman pled to one count on the immigration issue of helping one individual across the border who wanted to remain in the NXIVM family. That’s the record. The other five or six people that the government keeps referring to was absolutely not part of Ms. Bronfman plea.

Indeed, at the sentencing, the judge refused to use that as a basis to enhance the sentence. The second thing that Ms. Bronfman pled to had to do with misuse of a credit card, the beneficiary for the use of someone [Raniere] who was the beneficiary of the estate of the deceased [Pam Cafritz]. The record shows that when the lawyer said “you can’t do that anymore,” she stopped. Those were the two things she pled to. That is all.

And this is why all this talk about abuse, DOS, and sex trafficking that keeps spilling its way into Ms. Bronfman’s case is wrong. It is inappropriate. Here’s what we do have: these are the 3553 A6 factors – I’ll direct this part to Judge Calabresi, who doesn’t like my procedural due process arguments. Allison Mack [had] a RICO charge. A RICO charge, 168 to 210 [months] is the sentencing guidelines. 168 to 210. She got 36 months 82% departure. Salzman. RICO. 87 months to 108 months [sentencing guidelines] zero time. Bronfman, no RICO; the two charges I just articulated, comparatively minor. 21 to 27 months range.

And the judge upwardly departed by 200%, based on a host, at least in part of improper factors. Now, the government said more than one point drove the court to the decision. To the extent the government invites this court to articulate a new rule in the Second Circuit that if any argument somehow might justify a gross upward departure, the sentence must stand.

I respectfully suggest this Court does not want to articulate such a rule. The majority rule is that if it is apparent that the court relied on an erroneous factor and erroneous fact, then this court must reverse. So for example, a fact that cocaine was made into crack cocaine, that’s one of the cases we cite. Erroneous, no evidence to it. The Court reversed. One of the factors that the Court used, that is the standard, that’s the correct frame for this Court. I’m sorry, your honor, I see the red light [to tell him his time was up] and see you nodding.

Judge Calabresi: Thank you very much. Very well. We’ll reserve decision and we’re adjourned.

Frank Parlato