Second Circuit Reaffirms § 3553(a)(6) Targets Nationwide Disparities, Not Co-Defendant Parity, and Upholds Deferential Review of Sentencing Weighing

1. Introduction

Defendant-Appellant Derek R. Schwartz appealed a 72-month sentence imposed after he pled guilty (without a plea agreement) to one count of Conspiracy to Commit Wire Fraud (18 U.S.C. §§ 1349 and 1343) and four counts of Wire Fraud (18 U.S.C. § 1343). The district court (Kahn, J.) also imposed three years of supervised release and ordered restitution of $12,968,505.22.

Schwartz argued the sentence was both procedurally and substantively unreasonable because (i) the district court allegedly failed to consider § 3553(a) factors “specific to Schwartz” and his mitigation arguments (lack of criminal history, family and community ties, positive character evidence, and a voluntary $1,000,000 restitution payment), and (ii) the court failed to address purportedly unwarranted disparities between his imprisonment and a co-conspirator’s probation, as well as the sentence imposed on an alleged scheme leader.

2. Summary of the Opinion

The Second Circuit affirmed. It held that the district court:

• Made an adequate individualized assessment under 18 U.S.C. § 3553(a) by expressly referencing pertinent factors and tying them to Schwartz’s circumstances;
• Did not commit procedural error by the way it weighed mitigating evidence—disagreement with the balancing is not procedural unreasonableness;
• Did not err regarding sentencing disparity, because § 3553(a)(6) is aimed at nationwide disparities and does not require co-defendant parity, and in any event Schwartz failed to show he was similarly situated to the co-conspirator who received probation.

3. Analysis

A. Precedents Cited

The panel’s reasoning is anchored in a familiar line of Supreme Court and Second Circuit sentencing cases:

• Gall v. United States, 552 U.S. 38 (2007): Cited for the abuse-of-discretion standard governing review of procedural and substantive reasonableness, and for the requirement that a court state reasons in open court (consistent with § 3553(c)). Gall also embodies the post-Booker framework in which appellate courts give substantial deference to district-court sentencing judgments.
• United States v. Guldi, 141 F.4th 435 (2d Cir. 2025): Used twice: (i) to underscore broad district-court discretion over sentencing procedures and sources of information; and (ii) to articulate the appellate presumption that the sentencing judge considered all relevant § 3553(a) factors unless the record suggests otherwise.
• United States v. Lawrence, 139 F.4th 115 (2d Cir. 2025): Supplies the definitional distinction between procedural reasonableness (process) and substantive reasonableness (outcome) and frames substantive review as whether a sentence is “unsupportable as a matter of law.”
• United States v. Verkhoglyad, 516 F.3d 122 (2d Cir. 2008): Central to rejecting Schwartz’s “insufficient consideration” argument. Verkhoglyad stands for (i) no “robotic incantations” are required; (ii) consideration of factors does not mean any factor gets dispositive weight; and (iii) weight allocation is committed to the sentencing judge’s discretion.
• United States v. Osuba, 67 F.4th 56 (2d Cir. 2023): Provides the Second Circuit’s “shockingly high/shockingly low” articulation of substantive unreasonableness.
• United States v. Bullock, 152 F.4th 108 (2d Cir. 2025): Reinforces that substantive unreasonableness findings occur only in “exceptional cases,” emphasizing the high bar for reversal.
• United States v. Johnson, 567 F.3d 40 (2d Cir. 2009): Cited for the requirement that the district court make an individualized assessment based on the facts presented.
• United States v. Pollok, 139 F.4th 126 (2d Cir. 2025): Used to dispose of the claim that the court “improperly weighed” mitigation. Pollok supports the proposition that a defendant’s disagreement with balancing, by itself, does not establish procedural error.
• United States v. Wills, 476 F.3d 103 (2d Cir. 2007), abrogated on other grounds by United States v. Cavera, 550 F.3d 180 (2d Cir. 2008): Invoked to acknowledge the permissibility (not obligation) of considering similarities and differences among co-defendants at sentencing.
• United States v. Frias, 521 F.3d 229 (2d Cir. 2008); United States v. Gahagen, 44 F.4th 99 (2d Cir. 2022); United States v. Fernandez, 443 F.3d 19 (2d Cir. 2006), abrogated on other grounds by Rita v. United States, 551 U.S. 338 (2007): These cases collectively supply the doctrinal core for the co-defendant disparity issue: § 3553(a)(6) targets national disparity and does not require district courts to equalize sentences among co-defendants, especially where they are not similarly situated.

B. Legal Reasoning

1) Procedural reasonableness: consideration vs. weight

The panel treated Schwartz’s mitigation arguments as a classic attempt to convert a dispute over weight into a claim of non-consideration. It emphasized that the district court expressly referenced core § 3553(a) considerations—loss amount, role, victim impact, and Schwartz’s personal history (including lack of prior imprisonment and family/community ties)—and later confirmed in its written statement of reasons that it considered those same items.

The opinion’s key move is the application of Verkhoglyad and Guldi: appellate review presumes the judge considered the relevant factors, and the law does not demand a detailed response to each mitigating contention. The district court’s explanation was deemed sufficient because it identified relevant § 3553(a) categories and linked them to case facts.

2) Substantive reasonableness: deferential outer bounds

While the order does not perform an extended substantive analysis, it frames the standard through Lawrence, Osuba, and Bullock: the sentence must fall outside the “range of permissible decisions” (e.g., “shockingly high”) to be reversed. Notably, the district court imposed a downward variance (72 months, six months below the guideline range), further supporting affirmance under the deferential standard.

3) Co-conspirator disparity: § 3553(a)(6) is national; similarity is factual

The panel reasserted a recurring Second Circuit principle: § 3553(a)(6) requires consideration of nationwide disparities, not disparities among co-defendants in the same case. A district court may consider co-defendant parity (Wills), but is not required to do so (Frias; Gahagen; Fernandez).

Even on the assumption that co-defendant comparisons were relevant, the panel upheld the district court’s factual finding that Schwartz and the probationary co-conspirator were not similarly situated. The order highlights hierarchical facts: Schwartz recruited Luke Steiner, conveyed instructions, induced false representations to financing companies, pressed Steiner to continue participating, and recruited additional conspirators—conduct consistent with an aggravating role.

This factual hierarchy also blunted Schwartz’s comparison to Michael Mann (described as the scheme’s leader who defrauded institutions of $144,000,000). The court accepted that Schwartz’s knowledge may have been narrower than Mann’s, but held that narrower knowledge does not make Schwartz equivalent to a subordinate like Steiner.

C. Impact

Although nonprecedential, the order’s practical impact is to reinforce several litigation realities in the Second Circuit:

• Mitigation records must show neglect, not just disappointment: Where the sentencing transcript and statement of reasons mention the defendant’s history/characteristics and other § 3553(a) factors, an appellate claim that the court “failed to consider” mitigation is unlikely to succeed.
• § 3553(a)(6) arguments should be framed nationally: Parties relying on co-defendant comparisons face an uphill climb unless they can (i) show true “similarly situated” parity and (ii) persuade the district judge as a matter of discretion rather than legal obligation.
• Role facts matter more than labels: The panel treated recruitment, direction, and pressure as functional indicators of leadership/supervision, making “similarly situated” arguments vulnerable when the record supports hierarchy.

4. Complex Concepts Simplified

• Procedural vs. substantive reasonableness: Procedural reasonableness asks whether the judge followed the right steps (correct Guidelines calculation, considered § 3553(a), explained the sentence). Substantive reasonableness asks whether the final sentence is within the broad range of lawful outcomes—even if another judge might reasonably have chosen differently.
• “Individualized assessment” under § 3553(a): The judge must tailor the sentence to the defendant and the offense by considering statutory factors, but need not explicitly address every argument or give any factor controlling weight.
• § 3553(a)(6) sentencing disparities: This factor is mainly about avoiding inconsistent sentencing across the country for similar crimes and records. It does not require matching sentences among co-defendants in the same case.
• U.S.S.G. §3Bl.l(c) (aggravating role): A Guidelines provision allowing an enhancement when a defendant acted as an organizer, leader, manager, or supervisor. Evidence of recruiting others, directing conduct, or maintaining control can support such a finding.
• Downward variance: A sentence below the advisory Guidelines range based on § 3553(a) considerations (as opposed to a Guidelines “departure,” which is based on Guidelines-authorized grounds).

5. Conclusion

United States v. Schwartz affirms a below-Guidelines wire-fraud sentence by applying deeply deferential appellate standards and by distinguishing “consideration” of mitigating factors from “agreeing” with a defendant’s preferred weighting. It also reiterates that § 3553(a)(6) is primarily a tool against nationwide disparity, not a mandate of co-defendant parity—especially where the record supports differing roles and culpability.