## Facts

- The United States charged Robert LiButti with federal tax evasion and bank fraud.
- A jury convicted LiButti.
- At sentencing, LiButti sought a downward departure under U.S.S.G. § 5K2.13, claiming diminished capacity based on a compulsive-gambling disorder.
- LiButti asserted that, during the period of the charged conduct, he incurred millions of dollars in gambling losses.
- He did not possess enough funds at any one time to pay his total tax deficiencies in full, though he had sufficient funds at times to make partial tax payments.
- LiButti argued he kept gambling because he believed he could win enough to pay the tax debt in full.
- He offered expert testimony that compulsive gambling is a disorder that can impair judgment and reduce a person’s ability to conform conduct to the law.
- Despite not paying his taxes, LiButti spent heavily on luxury items (including luxury cars, furnishings, and fine wines) and on his business.
- In dealing with the IRS, LiButti sought to settle the tax liability for a small fraction of the assessed amount.
- The record included evidence that LiButti expressed the view that the IRS would not collect from him.

## Issues

1. Whether LiButti’s claimed compulsive-gambling disorder amounted to a “significantly reduced mental capacity” within the meaning of U.S.S.G. § 5K2.13.
2. Whether the alleged diminished capacity contributed to the commission of LiButti’s tax-evasion and bank-fraud offenses so as to justify a downward departure at sentencing.

## Decision

- The court declined to grant a diminished-capacity downward departure under U.S.S.G. § 5K2.13 on the basis of LiButti’s compulsive-gambling claim.
- In assessing the request, the court relied on the overall record of LiButti’s financial choices and conduct during the offense period, including discretionary spending and his dealings with the IRS.

## Legal Principles

- A downward departure under U.S.S.G. § 5K2.13 requires proof of a significantly reduced mental capacity and a showing that the reduced capacity contributed to the commission of the offense.
- The existence of a diagnosed condition, without a demonstrated connection to the criminal conduct, does not by itself warrant a diminished-capacity departure.
- When the offense conduct reflects sustained decision-making (such as continued nonpayment, discretionary luxury purchases, and strategic positions taken with tax authorities), a court may find the asserted impairment insufficient to reduce sentencing culpability under § 5K2.13.
- Sentencing courts may weigh expert testimony about mental conditions against objective conduct that indicates purposeful, controlled behavior in committing or continuing an economic crime.

## Conclusion

United States v. LiButti addresses a postconviction sentencing request for a U.S.S.G. § 5K2.13 departure based on compulsive gambling. Although LiButti presented expert testimony and pointed to extensive gambling losses during the offense period, the court concluded that the record did not support treating compulsive gambling as a qualifying diminished-capacity basis for a § 5K2.13 downward departure in light of his broader pattern of deliberate financial decisions and interactions with the IRS.


United States v. LiButti, 1994 U.S. Dist. LEXIS 19916 (1994)