United States v. Nathaniel Clay

In the
United States Court of Appeals
For the Seventh Circuit
____________________
Nos. 21‐3002 and 21‐3003
UNITED STATES OF AMERICA,
Plaintiff‐Appellee,
v.
NATHANIEL CLAY, and JOHN KNOX,
Defendants‐Appellants.
____________________
Appeals from the United States District Court for the
Northern District of Illinois, Western Division.
No. 09‐cr‐50041 — Iain D. Johnston, Judge.
____________________
ARGUED JUNE 3, 2022 — DECIDED JULY 27, 2022
____________________
Before SYKES, Chief Judge, and FLAUM and BRENNAN, Cir‐
cuit Judges.
FLAUM, Circuit Judge. Nathaniel Clay and John Knox were
convicted and sentenced to 320 months’ and 255 months’ im‐
prisonment, respectively, for their participation in a drug con‐
spiracy involving the distribution of crack cocaine and heroin.
After they were sentenced, Congress passed the Fair Sentenc‐
ing Act and the First Step Act (collectively, the “Acts”), which
prospectively reduced the penalties for crack cocaine offenses
2 Nos. 21‐3002 & 21‐3003
and created an avenue for defendants previously convicted of
such offenses to request reduced sentences from their sen‐
tencing courts. Clay and Knox filed motions under § 404(b) of
the First Step Act requesting this relief, but the district court
denied their requests. It first held that neither of the defend‐
ants were eligible for relief because their offenses involved
heroin, the penalty for which remains unaffected by the Acts,
and then ruled in the alternative that even if they were eligi‐
ble, it would decline to exercise its discretion to grant Clay
and Knox reduced sentences. The defendants appealed. On
appeal, the government concedes that Clay and Knox are eli‐
gible for relief under the Acts but nevertheless argues that we
should affirm the district court’s order because its alternative
ruling declining to reduce their sentences was not an abuse of
discretion.
For the following reasons, we agree with the government
and therefore affirm the district court’s order denying the de‐
fendants’ requests for reduced sentences.
I. Background
A. Procedural Background
In 2009 and 2010, Clay and Knox pleaded guilty to one
count each of conspiracy to possess with intent to distribute
and to distribute controlled substances. In particular, each
had been charged under 21 U.S.C. § 846 with conspiring to
violate 21 U.S.C. § 841(a)(1), with both defendants’ alleged
drug quantities being more than one kilogram of heroin and
more than 50 grams of crack cocaine. Each faced a ten‐year
minimum sentence under the statute as it read at the time,
both because their offenses involved more than one kilogram
of heroin and because they involved more than 50 grams of
Nos. 21‐3002 & 21‐3003 3
crack cocaine. Judge Kapala, who has since taken inactive sen‐
ior status, found that Clay’s sentencing range under the Sen‐
tencing Guidelines was 292 to 365 months and found that
Knox’s sentencing range under the Guidelines was 235 to 293
months; both exceeded the mandatory 120‐month minimum
sentence. Judge Kapala sentenced Clay to 320 months’ impris‐
onment and Knox to 255 months’ imprisonment. Both defend‐
ants appealed Judge Kapala’s drug quantity calculations, but
this Court affirmed. United States v. Block, 705 F.3d 755 (7th
Cir. 2013). In 2015, Knox filed a motion for a reduction to his
sentence based on changes the U.S. Sentencing Commission
made to certain provisions of the Sentencing Guidelines that
Judge Kapala had used in handing down his sentence. The
government agreed that after the amendments, Knox’s of‐
fense level dropped two levels, resulting in an updated
Guidelines range of 188 to 235 months. Judge Kapala accord‐
ingly reduced Knox’s sentence to 204 months.
In 2020, Clay and Knox each filed motions under § 404(b)
of the First Step Act, seeking reduced sentences based on
changes Congress made to the penalties resulting from cer‐
tain drug crimes. Because Judge Kapala is no longer in active
judicial service, Clay’s and Knox’s cases were re‐assigned to
Judge Johnston. Judge Johnston denied the motions, finding
the defendants to be ineligible for relief under the First Step
Act and ruling in the alternative that he would not exercise
his discretion to reduce their sentences even if they were eli‐
gible. These appeals followed and were consolidated.
B. Statutory Background
In 2010, Congress passed the Fair Sentencing Act, which,
among other things, effectively reduced the sentences for
many crack cocaine offenses by increasing the quantity of
4 Nos. 21‐3002 & 21‐3003
crack cocaine required to trigger the minimum ten‐year sen‐
tence from 50 grams to 280 grams. Pub. L. No. 111‐220, § 2,
124 Stat. 2372, 2372 (2010); 21 U.S.C. § 841(b)(1)(A)(iii). The
changes contained in the Fair Sentencing Act, however, were
not retroactive and applied only to defendants who commit‐
ted their offenses after August 3, 2010. In 2018, Congress
passed the First Step Act, which made certain provisions of
the Fair Sentencing Act—including the provision setting out
the quantity of crack cocaine required to trigger the ten‐year
sentence—retroactive. Pub. L. No. 115‐391 § 404, 132 Stat.
5194, 5222.
Section 404(b) of the First Step Act allows defendants con‐
victed of “covered offense[s]” to file motions requesting that
their sentencing courts impose reduced sentences “as if sec‐
tions 2 and 3 of the Fair Sentencing Act of 2010 … were in
effect at the time the covered offense was committed.” Pub. L.
No. 115‐391, § 404(b), 132 Stat. at 5222. The First Step Act de‐
fines a “covered offense” as “a violation of a Federal criminal
statute, the statutory penalties for which were modified by
section 2 or 3 of the Fair Sentencing Act of 2010 … that was
committed before August 3, 2010.” Id. Importantly, § 404(c) of
the First Step Act states that sentencing courts “may” impose
a reduced sentence and clarifies that nothing in the section
“shall be construed to require a court to reduce any sen‐
tence ….” Id. § 404(c). Accordingly, whether to grant a de‐
fendant’s request for a reduced sentence under the First Step
Act is left to the court’s sound discretion. United States v. Cor‐
ner, 967 F.3d 662, 665 (7th Cir. 2020) (per curiam) (“[S]ection
404(c) makes clear that the court is never required to reduce a
sentence under section 404(b).”). This Court has held, how‐
ever, that on a § 404(b) motion, the resentencing court’s fail‐
ure to exercise its discretion whatsoever or its failure to
Nos. 21‐3002 & 21‐3003 5
consider the now‐applicable statutory sentencing range con‐
stitutes an abuse of discretion. See United States v. McSwain, 25
F.4th 533, 540 (7th Cir. 2022) (failure to exercise discretion is
an abuse of discretion); United States v. Fowowe, 1 F.4th 522,
529 (7th Cir. 2021) (“[N]ot considering the lower statutory
penalties now applicable to a defendantʹs offense of convic‐
tion is procedural error.” (internal quotation marks and alter‐
ations omitted)).
II. Discussion
The district court held that Clay and Knox were ineligible
for relief under the First Step Act and that, even if they were
eligible for such relief, it would decline to exercise its discre‐
tion to reduce their sentences. On appeal, the government
concedes that Clay and Knox are eligible for sentence reduc‐
tions but nevertheless urges us to affirm the district court’s
decision by holding that it did not abuse its discretion when
it declined to reduce their sentences. For their parts, Clay and
Knox urge us to reverse on the grounds that the district court
abused its discretion by creating unwarranted sentencing dis‐
parities between them and their co‐defendants, whose mo‐
tions for sentencing reductions were granted by a different
district judge.
Motions for reduced sentences under § 404(b) of the First
Step Act are reviewed in two parts. First, the resentencing
court must determine whether the moving defendant is eligi‐
ble for relief, and then the court must decide, if eligible,
whether the defendant’s sentence should be reduced.
McSwain, 25 F.4th at 537. We consider these two steps in turn.
6 Nos. 21‐3002 & 21‐3003
A. Eligibility
Eligibility is a question of statutory interpretation that we
review de novo. McSwain, 25 F.4th at 538. The government ar‐
gued below that neither Clay nor Knox were eligible for relief
under the First Step Act because their conspiracy convictions
involved heroin in addition to cocaine, and heroin offenses
are unquestionably not “covered offenses” under § 404(b).
The government has reversed course on appeal, however,
conceding that ”a conspiracy to traffic crack cocaine … is a
covered offense even if another object of the conspiracy trig‐
gered the same statutory penalty range.” We need not conclu‐
sively resolve the question whether a defendant is eligible for
First Step Act relief when convicted of a multi‐drug conspir‐
acy; we accept the government’s concession that these de‐
fendants are eligible. We further note that the emerging con‐
sensus from our sister circuits is in accord with the govern‐
ment’s position. See id. (collecting cases from the Second,
Fourth, Fifth, Eighth, Tenth, and Eleventh Circuits).
B. Exercise of Discretion
Because the government has now conceded that defend‐
ants were eligible for relief under the First Step Act, the crux
of the dispute on appeal is whether the district court abused
its discretion when it held, in the alternative, that it would not
reduce the defendants’ sentences even if they were eligible for
reduction. In arguing that it was an abuse of discretion, de‐
fendants claim that Judge Johnston’s denial of their motions
created sentencing disparities between them and their co‐con‐
spirators, whose motions for sentence reductions were
granted by Judge Ellis. According to defendants, Judge John‐
ston “waived away the entire disparity analysis by claiming
he did not know what information Judge Ellis had when she
Nos. 21‐3002 & 21‐3003 7
reduced the co‐defendants’ sentences, and thus could not de‐
termine whether the disparity was warranted or unwar‐
ranted.”
This Court has given a significant amount of guidance
about what sentencing courts may consider when deciding
whether to reduce a sentence pursuant to a § 404(b) motion,
but we have said little about what such courts must consider.
For example, we have stated that courts may consider the fac‐
tors laid out in 18 U.S.C. § 3553(a), the current Guidelines, the
defendant’s post‐sentencing conduct, and other relevant in‐
formation about the defendant’s background. See United
States v. Shaw, 957 F.3d 734, 741 (7th Cir. 2020) (“Importantly,
nothing in the First Step Act precludes a court from utilizing
§ 3553(a)’s familiar framework when assessing a defendantʹs
arguments.”); United States v. Hudson, 967 F.3d 605, 609 (7th
Cir. 2020) (stating that courts are authorized to consider “cur‐
rent Guidelines; post‐sentencing conduct; and other relevant
information about a defendant’s history and conduct.”). The
only consideration that we have stated a court must take up
when deciding a § 404 motion is calculate the new minimum
and maximum statutory penalties. Fowowe, 1 F.4th at 529
(“[A] district court ruling on a § 404(b) motion therefore must
begin by recalculating the statutory minimum and maximum
that would have applied had §§ 2 and 3 of the Fair Sentencing
Act been in effect at the time the movant was originally con‐
victed.” (emphasis added)). In fact, we have explicitly re‐
frained from holding that courts are required to consider the
§ 3553(a) factors when deciding a § 404(b) motion, Shaw, 957
F.3d at 741 n.2 (“We leave for another day whether a court is
required to take § 3553(a) factors into consideration.”), and
we may resolve this appeal, too, without making such a hold‐
ing.
8 Nos. 21‐3002 & 21‐3003
Even assuming the district court were required to evaluate
the § 3553(a) factors, it did so adequately and therefore did
not abuse its discretion in denying defendants relief. The de‐
fendants rest their argument to the contrary on a single line
from the district court’s orders: “This Court cannot know
what information was available to any earlier judge who in‐
herited this case from Judge Kapala.” According to defend‐
ants, this sentence proves that the court shirked its duty to
“avoid unwarranted sentence disparities among defendants
with similar records who have been found guilty of similar
conduct.” 18 U.S.C. § 3553(a)(6).
Even assuming the district court had a duty to consider
this factor (along with the other sentencing factors in
§ 3553(a)), the defendants’ argument is unavailing. First,
whether a sentence creates an unwarranted sentencing dis‐
parity is an inquiry involving nationwide data, and thus a dis‐
parity between two co‐conspirators “is not a valid basis to
challenge a guideline sentence otherwise correctly calcu‐
lated.” United States v. Simpson, 337 F.3d 905, 909 (7th Cir.
2003); see also United States v. Courtland, 642 F.3d 545, 554 (7th
Cir. 2011) (“There is nothing per se improper about a sentenc‐
ing disparity among co‐conspirators, or even between [two
co‐conspirators] to whom a specific departure provision ap‐
plies.”); United States v. Gooden, 564 F.3d 887, 891 (7th Cir.
2009), as amended (May 20, 2009) (“We do not view the dis‐
crepancy between sentences of co‐defendants as a basis for
challenging a sentence and will disturb a sentence only if it
creates an unwarranted sentence disparity between similar
defendants nationwide.” (internal quotation marks omitted)).
Indeed, the Supreme Court has instructed that because avoid‐
ance of unwarranted disparities was a consideration of the
Sentencing Commission when it created the Guidelines, a
Nos. 21‐3002 & 21‐3003 9
within‐Guidelines sentence necessarily accounts for the need
to avoid unwarranted disparities. Gall v. United States, 552
U.S. 38, 54 (2007) (“[A]voidance of unwarranted disparities
was clearly considered by the Sentencing Commission when
setting the Guidelines ranges. Since the District Judge cor‐
rectly calculated and carefully reviewed the Guidelines range,
he necessarily gave significant weight and consideration to
the need to avoid unwarranted disparities.”); see also United
States v. Shamah, 624 F.3d 449, 460 (7th Cir. 2010) (“A within‐
guidelines sentence necessarily gives weight and considera‐
tion to avoiding unwarranted sentencing disparities.”). De‐
fendants fail to address any of these cases and offer no reason
why their holdings do not foreclose their arguments here. Be‐
cause Clay’s and Knox’s sentences were within Guidelines,
we may presume they do not create unwarranted sentence
disparities, notwithstanding the fact that other co‐conspira‐
tors received sentence reductions under § 404(b).
Second, and perhaps more significantly, the defendants’
proposed interpretation of the district court’s statement about
Judge Ellis’s decision to grant the other co‐defendants relief
under § 404(b) ignores the context within which the statement
was made. The full paragraph from the order reads as follows:
The obligation that [18 U.S.C. § 3553(a)] im‐
poses on this Court is to determine a sentence
that is sufficient but not greater than necessary
to serve the purposes of sentencing. The Court
has done so using all of the relevant information
available to it. This Court cannot know what in‐
formation was available to any earlier judge
who inherited this case from Judge Kapala. In‐
deed, there is no indication in the docket that
10 Nos. 21‐3002 & 21‐3003
the district judge who reduced the codefend‐
ant’s sentence possessed the presentence inves‐
tigation report for that defendant. And the
Court notes that at least some of the defendants’
Presentence Investigation Reports were not ini‐
tially available electronically on the docket, as
was the custom at the time, including the report
for Mr. Clay [and Mr. Knox], which [were]
docketed only after this Court asked the proba‐
tion department to do so. In light of all of the
information available to it and its balancing of
the § 3553(a) factors, this Court concludes that
the [defendants’ sentences] properly balance[]
the relevant sentencing concerns, and it there‐
fore declines to reduce [their] sentence[s].
The most reasonable interpretation of this passage is that the
district court was simply offering a possible explanation as to
why it was reaching a different conclusion than Judge Ellis
had: they were evaluating different information. To place any
more weight on the district court’s words would strain the
text beyond what it can bear.
Before reaching its conclusion, the district court consid‐
ered all of the following factors: whether the defendants par‐
ticipated in rehabilitation and re‐entry courses while incarcer‐
ated; their disciplinary history while incarcerated; the nature
and seriousness of their offenses; their prior criminal history;
the fact that drug crimes such as these “remain a scourge in
the Rockford community”; the importance of deterrence; the
fact that the defendants would still be subject to the same ten‐
year minimum sentences due to the quantities of heroin in‐
volved in their offenses; and the fact “that some of [the]
Nos. 21‐3002 & 21‐3003 11
codefendants who filed motions under the First Step Act de‐
cided by a different judge received sentence reductions.”
Only after weighing all of these factors—which include the
one factor this Court has said judges are required to consider
on a § 404(b) motion (the new statutory sentence range)—did
the district court reach its conclusion. Such a thorough review
of the relevant information is simply not an abuse of discre‐
tion.
III. Conclusion
For the reasons explained above, we AFFIRM the district
court’s orders denying the defendants’ motions for sentence
reductions under the First Step Act.