1.Sentencing Guidelines Ruling — Life Imprisonment Range

THE COURT: Yes. And the defendant is present.

Good morning, Mr. Raniere.

Before we begin the proceedings, I would like to extend some thanks to those who helped us put together this proceeding under the circumstances of the pandemic in such a way that we can minimize the danger to everyone here in the courtroom and in the courthouse.

And I would like to thank Chief Judge Mauskopf, who has overseen efforts of the Court to resume operations, with the assistance of the science, the experts, and the staff.

I would like to thank Magistrate Judge Scanlon, who was the magistrate judge assigned to this case.

In addition, I would like to thank the clerks' office and the IT Department, in particular, for making the arrangements for this courtroom and all of the overflow courtrooms that are being used. And I understand that we are using six overflow courtrooms for this proceeding so we can maximize the ability of the public to be present and observe the proceedings.

In addition, I would also like to thank District Executive Eugene Corcoran, and his staff, especially Ogoro Francis-McLeish, who dealt with all of the issues of the staging this particular courtroom with Plexiglas and other devices.

I would like to thank the U.S. Marshals, Vincent DeMarco, and his staff; as well as the members of my chamber's staff, my clerks, and Joseph Reccoppa, my courtroom deputy/case manager.

That having been said at this time, I will proceed. This is the sentencing of Keith Raniere who was convicted by a jury on June 19th, 2019 of numerous counts.

And the materials that I have reviewed for this sentencing are as follows: There is a presentence investigation report that I will refer to generally as the PSR, dated January 29th, 2020; the defendant's objections to the PSR of March 11th, 2020; the Government's responses to the defendant's objections to the PSR, March 25th, 2020; the addendum to the PSR, April 8th, 2020; the Government's sentencing memorandum, dated August 27th, 2020; the defendant's sentencing memorandum, including objections that remain to the PSR, dated September 19th, 2020; the Government's response to the defendant's sentencing memorandum, dated October 9th, 2020; letters in support of the defendant and victim-impact statements. And I think that covers everything.

All right. If there's anything else that I have not mentioned that I should be considering, please advise the Court.

THE COURT: All right. Thank you very much.

I remind everyone that we are all going to wear masks. Sometimes we forget and then we get reminded. We are all going to wear masks throughout the proceedings, including any statements that are made by victims or anyone else.

And at this point, I want to move on to the calculation of the Guidelines in this case. Now, as I said, I have the defendant's objections which are folded into the sentencing memorandum, and I have considered them and the Government's responses and I am ready to rule on these objections.

Does anyone have anything else to say about the objections that has not already been placed in the record for me to consider?

THE COURT: Thank you very much.

Anything from the Government?

THE COURT: All right. Very well.

The probation department recommends that I calculate the total offense level of Mr. Raniere's sentence as 52. The Government agrees with the PSR's calculation. Mr. Raniere objects to numerous aspects of the PSR and suggests that the correct offense level is 37. For the following reasons, I find that the appropriate offense level is 49.

Let me begin by addressing Mr. Raniere's objections to the PSR's Guidelines Calculations.

First, Mr. Raniere objects to the application of a 4-point role enhancement under the Sentencing Guideline Section 3B1.1(a), which applies, quote, "if the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive," end quote." The Second Circuit has held in United States v. Ivezaj, I-V-E-Z-A-J, 568 F.3d 88, Second Circuit (2009), that when calculating the Guidelines for a RICO offense, a Section 3B1.1 role enhancement should be applied to the base level, quote, "on the basis of the defendant's role in the overall RICO enterprise," end quote, rather than, quote, "on the basis of his participation in discrete racketeering acts." End quote.

Mr. Raniere asks this Court to distinguish the Second Circuit's holding in Ivezaj on the grounds that this case, unlike Ivezaj, does not involve a, quote, "traditional organized crime enterprise," end quote, engaging in violent criminal acts.

That argument lacks merit because the Second Circuit's analysis in that case was not based upon the, quote, "traditional," end quote, nature of the enterprise at issue or the violent nature of the predicate acts.

Rather the Second Circuit's conclusion that, quote, "it makes little sense to allow a defendant who acts in a leadership capacity in a wide ranging criminal enterprise to have his official level adjusted," end quote, based on his agreed participation in each predicate racketeering act applies with equal force in this case.

Accordingly, I reject Mr. Raniere's objections to the application of the four-point role enhancement in Paragraphs 181, 189, 197, 203, 209, 215, 221, 228, and 252 of the PSR.

Next, Mr. Raniere objects to two aspects of the calculations of Counts 1 and 2, Racketeering Act 2, which concerns the sexual exploitation of Jane Doe 2. First, he objects to the application of a two-level increase subject to Sentencing Guidelines Section 2G2.1(b)(2)(A), for an offense that involved the commission of a sexual act or sexual contact. He argues that the offense at issue involves the pornographic photographs that he took of Jane Doe 2 when she was a minor, and that because the photographs themselves do not depict a sexual act or sexual contact, the two-level increase is improper, notwithstanding evidence that Mr. Raniere did engage in an illegal sexual relationship with Jane Doe 2 beginning when she was 15 years old.

Both the Second Circuit and at least one other Circuit Court have determined that the Guidelines allow for a base offense level to increase under Section 2G2.1(b)(2)(A) on the basis of a Defendant's sexual contact with the victim in grooming her for the offense, even where the photographs that are the subject of the offense depict no sexual contact. I find that the trial records establishes by a preponderance of the evidence that Mr. Raniere took these photographs in the context of an ongoing sexual relationship, through which Mr. Raniere groomed her for the offense of conviction. I, therefore, find that the two-point increase applies.

I agree with Mr. Raniere's objection to a two-level enhancement on Racketing Act 2 subject to Sentencing Guidelines Section 2G2.1(b)(5), which applies if the defendant was the minor's parent, relative, or legal guardian, or if the minor was otherwise in the defendant's custody or care. While Jane Doe 2 was living in NXIVM-affiliated housing with adults other than her parents in November of 2005, she was not living with Mr. Raniere. This enhancement seems to be aimed particularly at situations in which the defendant is either the victim's parent or guardian or else plays an analogous custodial role. While Jane Doe 2 was entrusted to the care of the NXIVM community, led by Mr. Raniere, I do not think the record demonstrates that Mr. Raniere took on the kind of custodial role contemplated by the Guidelines. I, therefore, decline to apply this enhancement. I also agree with Mr. Raniere that the record does not support a two-level enhancement on Racketeering Acts 9(a) and 9(b), which concern the trafficking of Jane Doe 4, on the grounds that she suffered serious bodily injury. While the circumstances of Jane Doe 4's confinement clearly had a serious adverse effect on her physical health, including the denial of medical care for a severe toothache, and on her metal health, I find that the bodily injury she suffered was not of the type or severity contemplated by the Guidelines in providing for this enhancement.

I disagree with Mr. Raniere's objection to the cross-reference of the sex trafficking Guidelines on Counts 1 and 2, Racketeering Act 12(b), and Count 6, which concern the forced labor of Jane Doe 5. Mr. Raniere argues that the cross-reference creates a problem of double counting, but Mr. Raniere is also being sentenced for sex trafficking of Jane Doe 5. But as the Second Circuit has made clear, the Guidelines sometimes allow the Court to, quote, "apply multiple Guidelines provisions based on the same underlying contact for that is the result clearly intended by Congress and the Sentencing Commission," end quote.

In this case, the so-called double counting that Mr. Raniere objects to is contemplated by the Sentencing Guideline Section 2H4.1(b)(4)(B), and is a Guidelines calculation that, quote, "involves double counting in a literal sense, but does not involve impermissible double counting," end quote.

I agree with Mr. Raniere that the Government has not established by a preponderance of the evidence, that either Sylvie or additional DOS Victim 1 were victims of sex trafficking or a conspiracy to commit sex trafficking. I therefore decline to include those acts in the Guidelines Calculations.

I disagree with Mr. Raniere that he's entitled to a three-point reduction under the Sentencing Guideline Section 2X1.1(b)(1) with respect to his conviction attempted sex trafficking of Jane Doe 8. Section 2X1 -- 2X.1(b)(1) provides for a three-point reduction in the case of attempt convictions, quote, "unless the defendant completed all the acts the defendant believed necessary for successful completion of the substantive offense," end quote.

For the offense of conviction of sex trafficking, that exception would, therefore, apply if Mr. Raniere completed all the acts he believed necessary to, quote, "recruit, entice, harbor, transport, provide, obtain, maintain, patronize, or solicit," end quote Jane Doe 8 of purposes of engaging in commercial sex acts, regardless of whether Jane Doe 8 actually performed those acts.

I find that the preponderance of the evidence supports such a finding. The evidence at trial established that, in approximately November 2016, Jane Doe 8 was recruited into DOS, which she was told was a, quote, "women's-only organization," end quote. Her recruitment follow a pattern in which Mr. Raniere directed, quote, "first line," end quote, DOS slaves to recruit their own slaves, and instructed them to conceal from the recruits that he was involved with DOS in any way. Shortly after being recruited, Jane Doe 8 was given a, quote, "special assignment," end quote by her, quote, "masters," end quote to, quote, "seduce," end quote, Mr. Raniere, and allow Mr. Raniere to take a photograph to prove she had completed the, quote, "assignment," end quote. I find Jane Doe 8's testimony credible, and reject Mr. Raniere's contention that she somehow, quote, "misunderstood the assignment to sleep with Mr. Raniere," end quote.

Thus, while Jane Doe 8 ultimately refused to engage in a sex act with Mr. Raniere, I find that the preponderance of the evidence establishes that Mr. Raniere, quote, "completed all the acts he believed necessary for successful completion of the substantive offense," end quote. Accordingly, a three-point reduction under Section 2X1.1(b)(1) is not warranted.

I disagree with Mr. Raniere's objection to a five-level enhancement under the Sentencing Guidelines 4B1.5(b)(1) for engaging in a, quote, "pattern of activity involving prohibited sexual conduct," end quote. Under the Guidelines, a defendant engages in a pattern of activity involving prohibited sexual contact, quote, "if on at least two separate occasions the defendant engaged in prohibited sexual conduct with a minor," end quote. The evidence establishes that Mr. Raniere began a sexual relationship with Jane Doe 2 in or about September of 2005, when she was 15 years old. The evidence also established that, on at least two occasions, Mr. Raniere took photographs of Jane Doe 2 constituting child pornography. That is sufficient to establish a, quote, "pattern of activity involving prohibited sexual conduct," end quote, and the enhancement under 4B1.5(b)(1) is the therefore warranted.

Having addressed Mr. Raniere's objections to the PSR's Guidelines calculation, I will now calculate the Guidelines range for Mr. Raniere's sentence, using the 2018 Guidelines Manual.

On Count 1(a) for Visa Fraud, the base offense level is a 19 and a four-point role enhancement applies for an adjustment, adjusted total of 23.

Counts 1 and 2, Racketeering Acts 1(a) and 1(b), for Conspiracy to Commit Identity Theft and Unlawfully Possess Jane Doe 1's Identification, the base offense level is 19 and a four-point role enhancement applies, for an adjusted total of 23.

On Counts 1 and 2, Racketeering Acts 2 and 4, for Sexual Exploitation of Jane Doe 2 on November 2nd, 2005, the base offense level is a 32. I apply a two-level increase because Jane Doe 2 was older than 12 but younger than 16, a two-level increase because the offense involved sexual contact and a four-point increase for the defendant's leadership role, for an adjusted total of 40.

On Counts 1 and 2, Racketeering Acts 3 and 4, for sexual exploitation of Jane Doe 2 on November 24, 2005, the computation is the same as the one I just described, which is an adjusted offense level of 40.

On Counts 1 and 2, Racketeering Acts 5(a) and 5(b) for Conspiracy to Commit Identity Theft of James Loperfido, the base offense level is 19 and a four-point role enhancement applies for an adjusted total of 23.

On Counts 1 and 2, Racketeering Acts 5(a) and 5(c) for Conspiracy to Commit Identity Theft of Edgar Bronfman, Sr. the base offense level is a 19 and four-point role enhancement applies for an adjusted total of 23.

On Counts 1 and 2, Racketeering Act 6, for Conspiracy to Alter Records for Use in an Official Proceeding, the base offense level is 19 and a four-point role enhancement applies for an adjusted total of 23.

On Counts 1 and 2, Racketeering Act 7, for Conspiracy to Commit Identity Theft of Jane Doe 3, the base offense level is a 19 and a four-point role enhancement applies, for an adjusted offense level of 23.

On Counts 1 and 2, Racketeering Acts 9(a) and 9(b), for Trafficking and Document Servitude of Jane Doe 4, the base offense level is 22 and I apply a three-level increase because the victim was held in peonage or involuntary servitude for over a year, and a four-level increase for the defendant's leadership role, for an adjusted total of 29.

On Counts 1 and 2, Racketeering Act 10, for Extortion, the base offense level is a 19 and a four-level role enhancement applies, for an adjusted offense level of 23.

On Counts 1 and 2, Racketeering Act 12(a), and Counts 8 and 9 for Sex Trafficking of Jane Doe 5, the base offense level is a 30 and a four-level role enhancement applies, for an adjusted total of 34.

On Counts 1 and 2, Racketeering Act 12(b), and Count 6, for Forced Labor of Jane Doe 5, the base offense level is a 32 and four-point role enhancement applies for an adjusted total of 36.

On Counts 1 and 2, Racketeering Act 14, for Conspiracy to Commit Identity Theft of Jane Doe 7, the base offense level is 19 and a four-point role enhancement applies for an adjusted total of 23.

On Counts 1 and 7 for Wire Fraud Conspiracy, the base offense level is 19 and a four-point role enhancement apply, for an adjusted total of 23.

On Counts 1, 8, and 10 for Attempted Sex Trafficking of Jane Doe 8, the base offense level is a 34 and a four-level role enhancement applies, for an adjusted total of 38.

I then compute the multiple count adjustment, which requires that I assign one unit to the group with the highest offense level, and one additional unit to each group that is equally serious or 1-4 levels less serious. The two groups are related to sexual exploitation of Jane Doe 2 have a highest adjusted offense level at 40. I assign one unit to each of those groups, one unit to the group covering sex trafficking and forced labor of Jane Doe 5 and one unit to the group covering attempted sex trafficking of Jane Doe 8. That yields a total of four units. I then take the greater of the adjusted offense levels, which is 40 and increase the level by four points, based on the unit calculation. That would yield a Total Offense Level of 44.

Finally, because the offense of conviction is a covered sex crime, the defendant engaged in a pattern of activity involving prohibited sexual conduct, the defendant is not a career offender, and Section 4B1.5(a) of the Guidelines does not apply, I increase the offense level by five points, to total of 49. The Total Offense Level is therefore 49.

Having determined the Total Offense Level, I will now calculate the Guidelines Range. The defendant is in Criminal History Category 1, and thus his Total Offense Level -- and his Total Offense Level is 49. Using the Guidelines table, I calculate that the applicable Guidelines range is life imprisonment.

And that's the Court's decision. And the defense has its objection.