United States v. Behren, No. 10-3505 (8th Cir. 2011)
Annotate this CaseDefendant pled guilty to one count of securities fraud, alleged in the indictment to be a violation of 15 U.S.C. 78j(b), 78ff, and 17 C.F.R. 240.10(b)-5. At issue was whether the district court erred in holding that defendant was not entitled to the protection of section 78ff(a) because he pled guilty to a statutory offense and the no-knowledge provision was inapplicable to people convicted of violating criminal securities law. The court, reading the plain language of the statute, held that the district court erred when it determined that defendant's guilty plea to a violation of section 78j(b) prevented him from asserting the no-knowledge defense. Thus, defendant was entitled to assert the no-knowledge defense to imprisonment at sentencing. The court held, however, that the district court did not reach the question of whether defendant had met his burden of showing no knowledge under Rule 10(b)-5 and as such, the issue was remanded to the district court for consideration.
Court Description: Criminal case - Sentencing. District court erred when it determined that defendant's guilty plea to a violation of 15 U.S.C. Sec. 78j(b) prevented him from asserting the "no-knowledge" defense to imprisonment at sentencing; case remanded for further proceedings.
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