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Jeremy Johnson will get a new sentencing hearing after an appeals court said his judge made a mistake

Trent Nelson | The Salt Lake Tribune Jeremy Johnson leaves the Federal Courthouse in Salt Lake City, Wednesday March 16, 2016.

Entrepreneur Jeremy Johnson, who was sentenced in 2016 to more than 11 years in federal prison for providing false information to a bank, may not have to serve that much time after all.

The 10th U.S. Circuit Court of Appeals on Thursday reversed Johnson’s sentence and sent the case back to U.S. District Court in Salt Lake City for a resentencing.

In a 3-0 ruling, the appeals court said U.S. District Judge David Nuffer erred by enhancing the sentence based on a finding that that Johnson received more than $1 million as a result of his offenses. Prosecutors had failed to prove that Wells Fargo Bank received or relied on Johnson’s false statements in releasing funds, according to the court.

Despite the possibility of less time behind bars, the ruling was a disappointment for Johnson because the court declined to overturn his conviction on eight counts of providing false information to a bank.

“I find it disheartening that the conviction was affirmed,” Johnson’s attorney, Karra Porter, said. “He’ll still be serving more time than people who committed far more serious crimes.”

Porter said she is studying the ruling to determine whether there are other issues that could be reviewed on appeal. Melodie Rydalch, a spokeswoman for the U.S. attorney‘s office, said prosecutors are pleased with the decision.

After six weeks of testimony and presentation of evidence in early 2016, a federal jury convicted Johnson of the false information counts in connection with his marketing company called I Works. He was acquitted of 78 other charges that included bank fraud, wire fraud, conspiracy and money laundering.

Johnson's legal troubles began in 2010, when the Federal Trade Commission launched an investigation of I Works, which was selling information such as how to apply for government grants for personal expenses and how to earn income from Google AdWords. The matter eventually led to criminal charges against Johnson and two associates.

Johnson and former I Works manager Ryan Riddle were convicted of providing false information to Wells Fargo Bank, while accountant Scott Leavitt was acquitted of all 86 charges. Prosecutors said the false statements were made to obtain merchant accounts that were used to collect credit card payments for the marketing company's products after its other accounts were shut down because of excessive chargebacks by consumers.

In September arguments at the Denver-based 10th Circuit, Porter said Johnson did not make false statements to the bank. Rather, she said, his company sent account applications that are the basis of the charges to a third-party agent of Wells Fargo Bank.

Riddle, who was convicted of six counts of making false statements, was sentenced to five years in prison, a term that included an enhancement that applies if the defendant is a manager or supervisor and the criminal activity involved five or more participants. He also appealed, arguing that none of the people he supervised was a participant in the crime.

On Thursday, the 10th Circuit also reversed Riddle’s sentence and sent the case back to District Court for “more specific findings regarding the presence of subordinate participants in the offenses.”