School Administrator’s Sentence in E-Rate Antitrust Probe Not Disturbed

This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.

The U.S. Court of Appeals in Cincinnati has refused to set aside or correct a sentence imposed on an administrator in a Michigan public school district who pleaded guilty to charges arising from the Justice Department's antitrust investigation into fraud and anticompetitive conduct in the federal "E-Rate" program.

The E-Rate program provides funding to schools to improve Internet connectivity. The defendant was charged with using his position as an assistant school superintendant to steer contracts for E-Rate projects to a business under his control.

After pleading guilty to one count each of mail fraud and bank fraud, the defendant was sentenced to concurrent prison terms of 46 months and ordered to pay $1,342,702 in restitution.

The defendant argued that he would not have accepted the plea agreement, which included a 16-level increase under the U.S. Sentencing Guidelines, if his attorney had not given him incorrect advice concerning the proper legal standards for determining restitution and for calculating the amount of loss for purposes of the sentencing guidelines. However, the 16-level increase was appropriate because the amount of loss to the victims was between $1 million and $2.5 million. Thus, the defendant could not establish that his attorney gave him deficient advice concerning the calculation of loss or that rejecting the plea agreement was likely to result in a lesser sentence, according to the court.

Also rejected was the defendant’s argument that his attorney failed to properly advise him concerning the method of calculating the amount of loss for purposes of determining restitution.

The decision is Benit v. United States, 2012-1 Trade Cases ¶77,830.