Carlo J. Marinello II took his federal tax conviction all the way to the U.S. Supreme Court and won.
But despite his landmark victory, the 72-year old Buffalo man found himself back in court Wednesday, this time facing prosecutors intent on sending him back to prison anyway.
Marinello's lawyer called the government's efforts "vindictive" and reminded U.S. District Judge William M. Skretny that his client's only felony conviction was overturned by the high court.
"I implore you, judge," said defense lawyer Joseph M. LaTona. "This isn't about money. This is about power."
In the end, Skretny decided to keep Marinello out of prison and instead sentenced the former small business owner to "time served," a reference to the 21 months he already had spent in prison.
The judge's decision will end the government's campaign to return Marinello to jail unless prosecutors appeal. Assistant U.S. Attorney Russell J. Ippolito Jr. said the government will review Skretny's ruling before making a decision.
For Marinello — who conceded he kept poor records — the judge's sentence is the latest chapter in a legal battle that made history. He not only convinced the high court to hear his appeal, a rarity among local cases, civil or criminal. He also won.
In its 7-2 decision in March, the court found that the criminal tax law that led to Marinello's conviction was overly broad and subject to potential abuse by prosecutors.
Justice Stephen G. Breyer, in the majority opinion, said the notion that the government would use discretion when applying the law, "places too much power in the prosecutor’s hands."
When the high court ruled, Skretny released Marinello, but the government eventually moved to send him back to prison.
Prosecutors pointed to his failure to pay income taxes for 18 years and, more recently, his failure to make any restitution payments. He owes $351,763 to the Internal Revenue Service.
"He's not sorry about what he did," Ippolito said Wednesday. "He is the same person who did not pay a single cent of the taxes he owes."
Ippolito also recounted for Skretny the numerous tactics Marinello used to avoid paying taxes while running his courier business, including paying his employees in cash and transferring assets to his wife.
"Such willful conduct hardly deserves leniency," he said.
Marinello countered by asking Skretny to consider the 21 months he spent in prison before the Supreme Court ruling.
"I made a mistake," he said. "I apologize. I don't want to go back to jail."
LaTona said his client's original three-year sentence stemmed largely from the felony conviction that was overturned and noted that each of his misdemeanor convictions for tax evasion carried one-year concurrent sentences — less than the time he already had served.
He also believes Wednesday's re-sentencing violated his client's constitutional protection against a second prosecution for the same offense.
"He's elderly, he's broke and he's in poor health," LaTona said of Marinello on Wednesday. "He has no money to make restitution."
Marinello, following a jury trial in 2014 that focused on poor record keeping, was found guilty of eight misdemeanor charges of tax evasion and a single felony charge of obstructing the IRS.
Even Marinello admits he kept terrible records while running his company, Express Courier Group/Buffalo Inc. He also acknowledges destroying bank statements and commingling business income and personal expenses.
When he appealed his felony conviction, the Second Circuit Court of Appeals in New York City upheld it, but two judges dissented and, in graphic terms, warned of the potential consequences to taxpayers.
"If this is the law, no one is safe," said U.S. Circuit Judge Dennis Jacobs. “At some point, prosecutors must encounter boundaries to discretion, so that no American prosecutor can say, 'Show me the man and I’ll find you the crime.' "
The Supreme Court agreed and overturned Marinello's conviction.
In sparing him more prison time, Skretny noted that federal probation officials also recommended a sentence of "time served."