U.S. District Judge Sim Lake resentenced Jamie Olis to six years in prison this afternoon (Olis has already served about 2.5 years in prison) in the latest chapter of the three year saga that has become arguably the starkest example government’s dubious criminalization of business during the post-Enron era.

During the hearing, Judge Lake read portions of a lengthy opinion that he has written on the Olis resentencing. Although Judge Lake found that a sentencing guidelines sentence for Olis would be in a range of 151-188 months based on an estimated $79 million damage amount (the intended tax benefit to Dynegy from Project Alpha), he concluded that Olis deserved a non-guidelines sentence because of Olis’ exemplary character, the fact that Olis did not personally gain from Project Alpha, and that Dynegy did not fail as a going concern as a result of the transaction.

Judge Lake also concluded that the extensive publicity relating to Olis’ case and other recent white collar business cases has sufficiently informed the business world of the severity of fraudulent business conduct that principles of general deterrence do not require a guidelines sentence.

Although six years is a harsh sentence, my initial reaction to Judge Lake’s decision (before reading it) is that it would be very difficult to mount an effective appeal on Olis’ behalf to reduce the sentence.

On the other hand, the prosecution — exhibiting a lack of judgment that has become routine during this era of criminalizing business — announced at the end of the hearing that it intends to appeal Judge Lake’s opinion to the Fifth Circuit.

Frankly, I hope the government does appeal the sentence. That utter lack of prosecutorial discretion might be the only way to prompt the Fifth Circuit to take a whack at reducing Olis’ sentence further.

Update: Doug Berman, Ellen Podgor and Larry Ribstein, all of whom have blogged extensively on the Olis case, add their initial thoughts.

Professor Podgor’s point about the disparity between Olis’ sentence and the sentences of his co-defendants who copped pleas is particularly insightful.

Judge Lake notes in this opinion that this disparity in treatment between cooperating defendants and defendants who assert their innocence is a mechanism that Congress has adopted to facilitate cooperation in federal criminal investigations. But what looks good in theory has become ugly in practice.

Given the government’s overwhelming resource advantage and the willingness of prosecutors to appeal to jurors’ resentment to obtain convictions, asserting innocence in white collar criminal cases has become a risk that is too huge to take.