Court Orders Resentencing Of Former Wal-Mart Executive

By Cynthia Cotts and Bob Van Voris
Bloomberg News
Wednesday, August 29, 2007

Thomas M. Coughlin, the former Wal-Mart Stores executive convicted of stealing from the company, may have to go to prison after an appeals court ruling that his house-arrest sentence was too lenient.

A three-judge panel of the U.S. Court of Appeals for the 8th Circuit in St. Louis yesterday tossed out a trial judge's sentence of Coughlin, 58, to 27 months of house arrest. Coughlin did not prove that he was too sick to go to prison, the court said.

"The district court clearly erred in finding Coughlin suffers an extraordinary physical impairment and abused its discretion," the panel said in a 2 to 1 ruling. The case was returned to the trial court for resentencing.

Defense lawyers claimed that Coughlin's heart condition, diabetes, obesity and sleep apnea made him too fragile to survive prison. Prosecutors argued in an appeal that thousands of inmates get adequate care for similar conditions. Both sides can present new evidence before Coughlin is sentenced again, the panel said yesterday.

Coughlin, admitting that he falsified expense reports and stole Wal-Mart gift cards, pleaded guilty to fraud and failing to report illegal income for his 2000 taxes.

Federal guidelines call for up to 33 months in prison, the government said in the appeal. Prosecutors last year asked the sentencing judge for up to a year.

Coughlin was once the second-highest executive at Wal-Mart, the world's largest retailer. His lawyer, William W. Taylor III, did not reply to a message seeking comment on the decision. Wal-Mart, of Bentonville, Ark., had no comment.

In January 2006, Coughlin pleaded guilty to five counts of wire fraud and the tax charge. He said he used company money to buy merchandise such as hunting gear, dog food, underwear and a stuffed wild boar.

Coughlin was also sentenced to five years of probation and a $50,000 fine. He was ordered to pay $411,218 in restitution to Wal-Mart and the federal government.

U.S. District Judge Robert T. Dawson in Fort Smith, Ark., said he took Coughlin's health into consideration before sentencing him to home confinement.

"I think it's clear Mr. Coughlin is an exemplary citizen who has risen to the top, but he has had a pretty spectacular fall," Dawson said. "Considering the worldwide ridicule and embarrassment, the worst punishment may have already been administered."

In his 2006 guilty plea, Coughlin admitted using a stolen Sam's Club gift card in Joplin, Mo., to buy a cooler, two cases of beer, two cases of vodka, two containers of whiskey, a carton of tequila and a patio torch. He admitted falsifying expense reports to get reimbursement for care for his dogs and to upgrade his truck.

Judge Kermit E. Bye argued today in a dissent that imprisonment would pose a grave danger to Coughlin. Coughlin has had "multiple life-threatening cardiac episodes," said Bye, who cited a doctor's testimony that the former executive would have limited access to prescription drugs and a cardiologist.

© 2007 The Washington Post Company