Amicus Curiae Brief — Marinello v. United States, 138 S. Ct. 52 (2017) (No. 16-1144)

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OFFICE OF THE CLERK

IN THE

Supreme Court of the United States

CARLO J. MARINELLO, IT,

Petitioner,

v.

UNITED STATES,

Respondent.

On Wait or CERTIORARI TO THE UNITED STATES

Court oF APPEALS FOR THE SECOND CIRCUIT

BRIEF FOR AMICI CURIAE CAUSE OF

ACTION INSTITUTE AND NATIONAL

ASSOCIATION OF CRIMINAL DEFENSE

LAWYERS IN SUPPORT OF PETITIONER

— $< —— —

~ —__—_—_—-——-- ae ~~

JosHua L. DRATEL JOHN VECCHIONE

Co-Chair Amicus Erica L. MARsHALL*

Committee CAUSE OF ACTION INSTITUTE

NATIONAL ASSOCIATION OF 1875 Eye Street N.W.

CRIMINAL DEFENSE LawyeRS Washington, D.C. 20006

1660 L Street N.W. (202) 499-4232

Washington, D.C. 20036 erica.marshall@

(202) 872-8600 causeofaction.org

*Counsel of Record

Counsel for Amici Curiae

September 8, 2017

9 t Thrary of Congres

i

TABLE OF CONTENTS

Page

oy Be Be oy 9, ee Cee Seen pear ae i

TABLE OF CITED AUTHORITIES .............. ili

INTEREST OF THIé AMICI CURIAE........... l

RSI OY Cl PTUPEIEE DE ok 6 6s isis ve esee vines 2

OE Ae eee © OR EES GREE fein on ces csc cise eds’ 6

RET COLL e ad dca Rh dia Reda naeweeebal 8

I. This Court has routinely cabined broadly-

drafted criminal statutes that are vague or

lack meaningful mens rea requirements....... 8

A. The omnibus clause raises vagueness

SI sv 4 Cdr wk ohh s can Cheb htewteevers 9

3. The government's interpretation of the

omnibus clause invites its arbitrary

SN 5.5 dad aes Ca eid shane dcenesh 12

Il. The “corruptly” mens rea requirement

does not protect the statute from vagueness

concerns or constitute a meaningful

SUS CE CRIS 5. vice sees See kien sees 20

it

Table of Contents

Page

A. Whether the defendant had the “intent to

obtain an unlawful benefit” depends on

whether the benefit was unlawful, not on

whether the defendant knew the benefit

i ED oc Pa sak weet aces so~wa wes 22

B. Even legal acts or omissions can

IN Git ch Souci ecka beset neces os 23

C. The “unlawful benefit” does not need

ee ee Ot ee els 25

D. The act or omission need not even

actually obstruct or impede the

administration of the tax code or

be carried out with the intent to

obstruct or impede the administration

MIS gv owas 40 bso cr eceusceneus 27

CE Ss vec ck vse cde tedskemeatices even aen 30

rit

TABLE OF CITED AUTHORITIES

Page

CASES

Arthur Andersen LLP v. United States,

ee SA IE ow a aceecssiswtevewoten passim

Bell v. United States,

es on cb vk as dele panesee ey ness 12

Cheek v. United States,

I EES ch cobs poe ness eucasee haves a 18

DeCoster v. United States,

UT ce id's aad ahae eee been see a eam 2

Hlonis v. United States,

bed nneweneveee au 22

Fed. Comme’ns Comm'n v.

Fox Television Stations, Inc.,

Nn os eek aeeh ere ened ne 8

Gonzales v. Carhart,

en hg Ae ee dN evenee an’ 22

Crayned v. City of Rockford,

eS ae i eueenaenee eens 8

Johnson v. United States,

ne rs rs rd a eran ce wii OE 8

WwW

Cited Authorities

‘olender v. Lawson,

GGE UF. TR TROP i oi ids ce draceytivaees

Laparota v. United States,

BUY US. GED IRON: ose cvcncecsscnseweenen

Marinello v. United States,

137 S. Ct. 2327 (Mem), 85 U.S.L.W. 3602

(TIS. SUMO DG, MEE) occ cc cevncduwnkeeer ed

McCutcheon v. Fed. Election Comm'n,

Pee er

McDonnell v. United States,

IDG SB. Ct. SEG GSN s oo vcopvtiunes cen

McNally v. United States,

SBR UD. BIOS vc ccvetsescsiiaaenpans

Morissette v. United States,

AZ UR. BUR Ge 6 oe i veccsagcavensake

Morrison v. Olson,

45T UB. GOA Co cc recacceienasenanes

Overton v. United States,

NO. TDR GRE) oc ca vis wccuvenecepnaes

Ratzlaf v. United States,

G20 UB. SOD CI oe oes von sssccvasevumes

v

Cited Authorities

Page

Rewis v. United States,

ewes eesue 12

Shushan v. United States,

i ) ) 1]

Skilling v. United States,

ee wee wnecsacese 11

Staples v. United States,

ES rr 18

LS. Civil Serv. Comm'n v.

Nat'l Ass'n Letter Carriers, AFL-CIO,

Ne oc ea recresene 10

Unated States v. Aguilar,

sc cases eseees 4, 10, 18, 28

United States v. Allison,

264 Fed. App’x 450 (5th Cir. 2008). ..........-. 26-27

United States v. Armstrong,

974 F. Supp. 528 (.D. Va. 1997). ............. 16, 24

United States v. Bezmalinor ic,

No. 83-96-CR-97, 1996 U.S. Dist. LEXIS 18976

Tee eee 24

uw

Cited Authorities

Page

United States v. Biller,

No. 06-CR-14, 2007 U.S. Dist. LEXIS 7156

OCT. W. Va. Fan. BE, BERT) . wos cc cccccccces 16, 24

United States v. Biack,

“ete g " ff, 2) Mo b Re 2

United States v. Blake,

No. 12-CR-104, 2014 U.S. Dist. LEXIS 136049

(E.D. Tenn. Sept. 26, 2014) ..... 2. ccccccceccenes 3

United States v. Bastian,

ep OS O06 Cts Cie TBR). 2. 5 occ acc ceccvcccseun 24

United States v. Bostian,

rope F. Yo Le. | eee 19, 23

United States v. Bowman,

178 F.3d 505 (Gth Cir. 1999)... 2... cece eens 25

United States v. Brennick,

908 F. Supp. 1004 (D. Mass. 1999) .........-.--+- 21

United States v. Castaldi,

, $e (| fy te | | Some rr 3

United States v. Croteau,

No. 2:13-CR-121, 2014 U.S. Dist. LEXIS 170025

(M.D. Fia. Dee. 8, 2014)... .. 2. cee ccc cccceseeses 3

Vit

Cited Authorities

Page

United States v. Daugerdas,

No. S3-09-Cr-581, 2011 U.S. Dist. LEXIS 14912

ES EE so oc vcd cen cs tboeussccenes 16

Lnited States v. Dykstra,

. Be , | Yor %. e 20

United States v. Floyd,

, jw t .:' (o 9 — |e 3,5, 27

United States v. Giambaivo,

810 F.3d 1086 (Bth Cir. BOIG)...... eens 25, 27

United States v. Hanson,

ee EL ¢. cca wvacceweneewesanss 21

United States v. Ilenderson,

386 F. Supp. 1048 (S.D.N.Y. 1974). ............. 3, 13

United States v. Ilerder,

551 Fed. App’x 257 (6th Cir. 2014) ................ 3

United States v. Johnson,

571 Fed. App’x 205 (4th Cir. 2014) ................ 3

United States v. Kahre,

No. 05-CR-121, 2009 U.S. Dist. LEXIS 39473

Ce Se SE ES 6 Sosc cn censvccsvensonses 23

United States v. Kassouf,

144 F.3d 962 (6th Cir. 1998)................... 7, 29

wii

Cited Authorities

Page

United States v. Kelly,

147 F'3d 172 (2d Cir. 1908). .... 2.2200 ee cence ae

United States v. Kozak,

No. 12-CR-344, 2014 U.S. Dist. LEXIS 40983

(D. Neb. Fob. 7, 2014) .. 22.2 ec ccesccccccccnvcees 3

United States v. Madoch,

108 BS 761 (7th Cir, 1997)... .. 2. ce cccccecccces 19

United States v. Marinello,

839 F.3d 209 (2d Cir. 2016) .........---«+-- passim

United States v. Martin,

747 F.2d 1404 (11th Cir. 1984)... .......---0- ees 20

United States v. Massey,

419 F.3d 1008 (9th Cir. 2005) ........- cece ee eeees 5

United States v. Mathis,

No. CR-1-97-15, 1997 U.S. Dist. LEXIS 24049

(S.D. Ohio June 2, 1997) ........-- eee cece eeees 17

United States v. Mcbride,

362 F.3d 360 (6th Cir. 2004) ... 2.2.02. eee ee ees 19

United States v. Miner,

714 F.3d 396 Cth Cir, BOI)... .. 2. eee ccc ence BT

Cited Authorities

Page

United States v. Mitcheil,

fw be SL ee 15

lnated States v. Moleski,

No. 12-CR-811, 2014 U.S. Dist. LEXIS 3908

ee I Sons enc cdsibh vive sueee de ts 3

United States v. Ogbazion,

No. 15-CR-104, 2016 U.S. Dist. LEXIS 148358

ee ee Se cs os cs ceneeyeiebskacectd 29

United States v. Popkin,

943 2d 1636 (11th Cir. 1991).............. passim

United States v. Reeves,

, be i | fe ) |e eer 21

United States v. Saidana,

427 F.3d 208 Gth Cir. O05) . 2... occ ot ly OD

United States v. Savud,

595 Fed. App’x 182 (4th Cir. 2014) ................ 3

Umaited States v. Sorenson,

oe BB cht (+ 3} |. \ passim

United States v. Sun-Diamond Growers,

ee as ok gap eae pheuial 4

xe

Cited Authorities

Page

United States v. Taylor,

550 Fed. App’x 135 (8d Cir. 2014)... ...----- eee ee 3

United States v. Toler,

972 F. Supp. 1030 (W.1). Va. 1997) ....--- +--+ es 16

United States v. Trimble,

12 F. Supp. 3d 742 (E.D. Pa. 2014) ...---..+--- +0 3

United States v. U.S. Gypsum Co.,

AM TTT GRR OIDTD. 2c oc cc voce secs cveewetcscnns 18

United States v. Valenti,

191 F'3d B27 (7th Cir. 1997). ... 0.2 c cn cevcces 19

United States v. Weiss,

754 F.3d 207 (4th Cir. 2014)... 0. ee ee ee eee eee 3

United States v. Williams,

644 F.2d 696 (Sth Cir. 1981)... 2.6... - eee eee 3,12

United States v. Williamson,

746 F.3d 987 (10th Cir. 2014)... 2.62. eee ee eee 5

United States v. Willner,

No. 07-CR-183, 2007 U.S. Dist. LEXIS 75597

(S.D.NLY. Oct. 11, 2007)... 2. cece scr vccccnscces 17

United States v. Wilson,

118 F.3d 228 (4th Cir. 1997). ........-2cceeeee 21, 23

a

-

xt

Ciled Authorities

Page

United States v. Wood,

484 Fed. App’x 698 (10th Cir. 2010) ............-- 17

United States v. Workinger,

90 F.3d 1409 (9th Cir. 199f)................22-.- 19

United States v. X-Citement Video, Inc.,

Re cls cc cveuwkescwearseeesied 18

United States v. Yugow,

ee ee ee EE GI, EPS ccc cccccevsnccccnens 26

Yates v. United States,

OE ee er 3.4,11, 12

STATUTES AND OTHER AUTHORITIES

SE GT Cac cc suas wasas beroduiuaes ben es

SE caches hen etevanciseeschecocanwer 11

sc occas he ddedbaseeeseneseseaes 26

Sp EE ia had.chew cee ion aud wd eoep esterase’ 26

C255 ec bhbx dene aeeehesb es pe den eal 7

Be de O Pees ov ecb einedevwopid Gevsnesions 17

xit

Cited Authorities

Page

RA Oe oH hada Gee eee Ps eek ewe eae 16

ee Rs Oe ha Vik or Ow es ieee were 12, 16, 20, 27

Se hi o dg Paieeceus see ta wares pass1m

ae RE GE RSa as Ca bene ke eeu ee her vas womens 21

ee Eas Un gicake ae phase Reve eeebeleweeien 26

Attorney General Robert H. Jackson, Address

Delivered at the Second Annual Conference of

United States Attorneys (Apr. 1, 1940) .......... 10

i ON lg ane Gea as og we miinae 1

Dep’t of Justice, Criminal Tax Manual

ON ra re oases eueS 14

Dep't of Justice, Criminal Tax Manual

See MES cok / cna e Colbae Rk deaepeed 13, 20

Dep't of Justice, Crimina] Tax Manual

PT Rc beni ek Bad badd cvndeewars 14

Dep’t of Justice, Criminal Tax Manual

ae NETS oi’ Sere Sa vnwe te cones ens e508 19

Dep’t of Justice, Criminal Tax Manua!

ok 8S eA Se eee eee 15, 19

xiii

Cited Authorities

Page

Dep't of Justice, Criminal Tax Manual]

EE Ee ee ea 13

Dep’t of Justice Tax Division Directive No. 77

Ie ass cb adeekebweaesd 364006 0d00e 13

John A. Townsend, Tax Obstruction Crimes:

ls Making the IRS’s Job Harder Enough?,

9 Hous. Bus. & Tax L. J. 255 (2009). ............. 14

Julie R. O'Sullivan, Symposium 2006: The

Changing Face of White-Collar Crime: The

Federal Criminal “Code” is a Disgrace: The

Obstruction Statutes As Case Study, 96 J. Crim.

L. & Criminology 643 (Winter 2006)............. 23

Kathryn Keneally, Column: White Collar Crime,

Be GT PET a y sicbvccatossvccenvnes 13, 26

RO INO sv eciicticcctsevcevaenveuue ]

U.S. Att’ys Manual § 6-4.211 (1988) ................ 13

]

Pursuant to Supreme Court Rule 37.3, Cause of Action

Institute (“CoA Institute”) and National Association

of Criminal Defense Lawyers (““NACDL”) respectfully

submit this amici curiae brief in support of Petitioner.'

INTEREST OF THE AMICI CURIAE

Amicus curiae CoA Institute is a nonprofit, nonpartisan

government oversight organization that uses investigative,

legal, and communicatiuns tools to educate the public on

how government accountability, transparency, and the rule

of law protect liberty and economic opportunity.’ As part

of this mission, it works to expose and prevent government

and agency misuse of power by, tzter alia, appearing as

amicus curiae before this and other federal] courts. See,

¢.g., McCutcheon v. Fed. Election Comm’n, 1348. Ct. 1434,

1460 (2014) (citing CoA Institute’s amicus brief).

CoA Institute has a particular interest in challenging

government overreach in the criminal justice system,

protecting the rule of law, and working to combat the

criminalization of conduct that can be addressed through

existing civil law—+.e., the process of “overcriminalization.”

In order to fulfill this mission, CoA Institute has

represented criminal] defendants in federal court, e.g.,

1. In accordance with Supreme Court Rule 37.3, CoA

Institute notified the counsel of record for all parties and all

parties consent to the filing of this brief. No counsel for a party

authored this brief in whole or in part, and neither the parties,

their counsel, nor anyone except CoA Institute and NACDL

financially contributed to preparing this brief.

2. CoA Institute, About, http://ww w.causeofaction.org/about

(last visited Sept. 8, 2017).

2

United States v. Bluck, No. CR 12-0002 (N.D. Cal),

appeared as amicus curiae in Yates v. United States, 135

S. Ct. 1074 (2015), and appeared as amicus curiae in other

eriminal matters before this Court. See, e.g., DeCoster v.

United States, No. 16-877 (2017); Overton v. United States,

No. 15-1504 (2017).

Amicus curiae NACDL is a nonprofit, voluntary

har association that works on behalf of criminal defense

attorneys to ensure justice and due process for those

accused of a crime or misconduct. NACDL files numerous

amicus briefs each year in the U.S. Supreme Court and

other federal and state courts, seeking to provide amicus

assistance in eases that present issues of broad importance

to criminal defendants, criminal defense lawyers, and the

criminal justice system as a whole.

NACDL has an interest in ensuring the fair and just

development of basic criminal] law principles, including

limits on prosecutorial discretion and upholding mens

rea requirements. NACDL believes that this case

presents an appropriate vehicle for the Court to clarify

the prosecutorial limits and mens rea requirements of the

“omnibus clause” of 26 U.S.C. § 7212(a).

SUMMARY OF ARGUMENT

Tucked away in the text of a statute punishing those

who use force or threats to intimidate or impede Internal

Revenue Service (“IRS”) agents, is what has become

known as the “omnibus clause” —words that, when strung

together, punish “[wJhoever . . . corruptly... obstructs

or impedes . . . or endeavors to obstruct or impede... the

due administration of [the tax code].” 26 U.S.C. § 7212(a).

3

For nearly three decades after the statute’s passage this

clause languished unused, with the first reported appellate

decision invoking it not appearing until 1981. U/nzted

States v. Williams, 644 F.2d 696, 701 (8th Cir. 1981).

Prior to that case, the government had actually taken the

position that “thus far all prosecutions |under 26 U.S.C.

§ 7212] have involved the use of force, violence or threats”

because “the legislative history of section 7212 indicates

that its purpose was to prevent intimidation or impeding

of Internal Revenue Service agents by force or threats

of force.” United States v. Henderson, 386 F. Supp. 1048,

1056 (S.D.N.Y. 1974).

Now, the omnibus clause, a felony containing a lower

“corruptly” mens rea requirement than the “willful”

violations required of most tax code misdemeanors, and

a possible three-year sentence, is routinely added to

prosecutions under Title 26. In 2014, alone, the omnibus

clause was the debate of at least thirteen reported cases, a

number that does not include countless other indictments

that were filed that same year.’ Its current prominence is

3. See, e.g., United States v. Floyd, 740 F.3d 22 (1st Cir. 2014);

United States v. Taylor, 550 Fed. App’x. 135 (8d Cir. 2014); United

States v. Saoud, 595 Fed. App’x. 182 (4th Cir. 2014); United States

v. Weiss, 754 F.3d 207 (4th Cir. 2014); United States v. Juknson, 571

Fed. App’x. 205 (4th Cir. 2014); United States v. Herder, 551 Fed.

App’x. 257 (6th Cir. 2014); United States v. Miner, 774 F.3d 336 (6th

Cir, 2014); United States v. Castaldi, 743 F.3d 589 (7th Cir. 2014);

United States v. Trineble, 12 F. Supp. 3d 742 (E.D.Pa. 2014); Unzted

States v. Croteau, No. 2:13-CR-121, 2014 U.S. Dist. LEXIS 170025

(M.D.Fla. Dec. 9, 2014); United States v. Blake, No. 12-CR-104, 2014

U.S. Dist. LEXIS 136049 (E.D.Tenn. Sept. 26, 2014); United States

v. Kozak, No. 12-CR-344, 2014 U.S. Dist. LEXIS 40983 (1). Neb. Feb.

7, 2014); United States v. Moleski, No. 12-CR-811, 2014 U.S. Dist.

LEXIS 3905 (D.N.J. Jan. 13, 2014).

4

unsurprising as the majority interpretation of the statute

covers such a broad swath of conduct that even many

specifically-enumerated criminal offenses within the tax

code could constitute obstruction.

In this case, failure to provide an accountant with

documents, throwing away receipts, and cashing business

checks were just a few of the routine actions considered

to qualify as obstruction of the tax code, even though Mr.

Marinello had no knowledge of the future investigation

the IRS would undertake at the time of his purportedly

criminal action. Pet. App. 4a, 15a.

This Court has routinely cabined criminal! statutes

within their proper textual context where the outer

bounds of statutory interpretation threaten vagueness and

fail to provide fair notice to ensure that everyone indicted —

under a statute knows he was violating the law. See, e.g.,

MeDounell v. United States, 1386S, Ct. 2355, 2867 (2016);

Yates, 135 S. Ct. at 1074; Arthur Andersen LLP v. United

States, 544 U.S. 696 (2005); United States v. Aguilar,

515 U.S. 593 (1995). These mens rea requirements are

essential to our criminal law jurisprudence. As such, this

Court has never left the outer bounds of a statute up to

prosecutorial discretion. United States v. Sun-Diamoud

Growers, 526 U.S. 398, 408, 412 (1999) (declining to rely

on “the Government’s discretion” to protect against

overzeajous prosecutions). The omnibus clause, as

applied in a majority of the circuits, runs counter to these

blackletter principles. It should join the list of statutory

clauses properly cabined by this Court.

As currently interpreted in the First, Second, Ninth,

and Tenth Circuits, any act or omission done “corruptly”

5

that impeded the |RS’s ability to administer the tax

code, at any point, constitutes obstruction of the tax code,

regardless of whether the defendant knew there was any

investigation or specific IRS action pertaining to that

individual. See United States v. Marinello, 839 F.3d 209

(2d Cir. 2016); United Stales v. Sorenson, 801 F.3d 1217,

1225-26 (10th Cir. 2015); Floyd, 740 F.3d at 32; United

States v. Massey, 419 F.3d 1008, 1010 (9th Cir. 2005).

Respondent asserts the administration of the tax code

is “continuous, ubiquitous, and universally known to exist,”

and that every person is on notice that the government

is always executing the tax code. See Gov't Br. in Opp’n

to Pet. for Cert. (“BIO”) at 9. Yet, it nonetheless argues

that any constitutional vagueness concerns are assuaged

by the mens rea requirement in the sLatute, meaning that

the defendant acted “corruptly.” BIO at 11. Circuit courts

have also taken false comfort in the bounds placed on the

omnibus clause by the requirement that the defendant

have acted “corruptly.”

As a practica] matter, this mens rea requirement

does little to cure vagueness concerns or restrict the

omnibus clause’s application. To act “corruptly” is to act

“with intent to gain an unlawful advantage or benefit for

oneself or for another.” Sorensoz, 801 F.3d at 1225 (citing

United States v. Williamson, 746 F.3d 987, 992 (10th Cir.

2014)); see, e.g., United States v. Saldana, 427 F.3d 298,

305 (5th Cir. 2005); United States v. Kelly, 147 F.3d 172,

177 (2d Cir. 1998); United States v. Popkin, 943 F.2d 1535,

1539-40 (11th Cir. 1991).

As currently interpreted, the omnibus clause applies

regardless of whether the defendant knew his act or

6

omission was obstructing the IRS, regardless of whether

that act or omission actually did obstruct the IRS in its

administration of the tax code, regardless of whether the

defendant knew the benefit he ultimately obtained was

unlawful, and regardless of whether the act or omission

is otherwise completely legal. Importantly, because the

definition of “corruptly” requires only that the defendant

acted to obtain an unlawful benefit, and the courts have

held that the obstruction of the IRS’s administration of the

tax code can be at some point in the future, the government

does not even need to prove that the defendant actually

knew he was obstructing the [RS when he performed the

complained-of act or omission.

This Court should adopt the reading of the statute

supported by Petitioner and cabin the omnibus clause

to the context of the statute within which it lies—one

directed ut punishing those who use force, threats, or

corrupt actions to obstruct specific IRS officials or known

IRS investigations. The position adopted by Petitioner is

backed not only by the text of the statute but also by years

of jurisprudence from this court limiting the application of

criminal! statutes in order to avoid vagueness and ensure

meaningful mens reo requirements.

STATEMENT OF TILE CASE

In United States v. Marinelio, 839 F.3d 209 (2d Cir.

2016), the United States obtained an indictment against

Mr. Carlo J. Marinello, Il, under 26 U.S.C. § 7212(a)’s

“omnibus clause” of the criminal portion of the tax code,

which, in relevant part, makes it a felony to “in any other

way corruptly ... obstruct| | or impede| }, or endeavor| | to

obstruct or impede, the due administration of | Title 26].”

7

Pet. App. 6a—7a. Although the tax code expressly sets forth

numerous felonies, and requires the government to prove

that the defendant “willfully” violated those statutes, see,

e.g., 26 U.S.C. § 7201 et seq., the government argued, and

the Second Circuit agreed, that Mr. Marinello could be

guilty of the felony of corruptly obstructing or impeding

the administration of the tax code by performing acts

as common as “failing to maintain corporate books and

records for . . . his small business,” “failing to provide

{his} accountant with complete .. . infurmation related to

[his] personal income,” and “discarding business records”

because he performed these acts and omissions with the

intent to obtain an unlawful benefit—-not paying taxes.

See Pet. App. 6a—7a, 32a—35a.

The Second Circuit declined to adopt the holding in

United States v. Kassouf, 144 F.3d 952 (6th Cir. 1998), as

affirmed in L’/nited States v. Miner, 774 F.3d 336 (6th Cir.

2014), which would have required the government to prove

that the defendant took action to impede or obstruct a

pending IRS action in order to obtain a conviction under

the omnibus clause. Pet. App. 23a—25a. Rejecting the

Sixth Cireuit’s concerns of vagueness and overbreadth,

the Second Circuit stated that the term “corruptly”

sufficiently restricts the reach of the omnibus clause.

Pet. App. 27a. Mr. Marinello filed a Petition for a Writ

of Certiorari from the Second Circuit, which this Court

granted. Marinello v. United States, 137 S.Ct. 2327

(Mem), 85 U.S.L.W. 3602 (U.S. June 27, 2017) (No. 16-1144).

8

ARGUMENT

1. This Court has routinely cabined broadly-drafted

criminal statutes that are vague or lack meaningful

mens rea requirements.

The Fifth Amendment provides that “[njo person shall

. be deprived of life, liberty, or property, without due

process of law.” U.S. Const. amend. V. “Our cases establish

that the Government violates this guarantee by taking

away someone’s life, liberty, or property under a criminal

law so vague that it fails to give ordinary people fair notice

of the conduct it punishes, or so standardless that it invites

arbitrary enforcement.” Jolson v. United States, 135

S. Ct. 2551, 2556-57 (2015) (citing Aoleuder v. Lawson,

461 U.S. 352, 357-58 (1983)). The fair notice requirement

extends to both criminal] and civil cases. See, e.g., Fed.

Comme’ns Comm'n v. Fox Television Stations, Inc.,

567 U.S. 239, 253-54 (2012). It ensures that Congress

speaks clearly when proscribing conduct, so that police,

prosecutors, judges, and juries are not impermissibly

delegated lawmaking authority to be supplied on an ad

hoe and subjective basis. See Grayned v. City of Rockford,

408 U.S. 104, 108-09 (1972).

In McDonnell v. United States, this Court rejected

an argument similar to the one the government is making

here, that “Congress used intentionally broad language” in

defining an “official act” in the bribery statute. 136 S. Ct. at

2367 (internal citation omitted). Rather, making a reference

to the “standardless sweep” of the government’s broad

reading, this Court held that the government’s expansive

interpretation of “official act” failed to provide fair notice

about the conduct proscribed and would encourage

arbitrary and discriminatory enforcement. /d. at 2373.

9

Here, too, the government's request for a broad

reading of the omnibus clause would place the statute on

constitutionally infirm ground. For this reason, the Court

should adopt the interpretation urged by the Petitioner.

A. The omnibus clause raises vagueness concerns.

The government’s interpretation of the omnibus clause

does not give ordinary people fair notice of what conduct

is actually illegal. Here, conduct as common as throwing

away reccipts, failing to keep books and records, failing

to give an accountant “complete” information, “cashing

business checks,” and using business receipts to pay

personal expenses were deemed by the government, and

found by a jury, to obstruct or impede the IRS’s “due

administration” of the tax code. See Pet. App. 6a—7a.

The question for this Court is whether the »verage

taxpayer would know that not doing something—like not

giving their accountant a record showing their recent $200

profit from an eBay sale of their old record collection—was

felony obstruction of the IRS’s administration of the tax

code. Certainly, the taxpayer might know that this $200 is

probably revenue and that he should probably report it to

his accountant. And in this scenario, the failure to send this

income to his accountant would, at least plausibly, impede

the IRS’s ability to levy and collect taxes on that money

in the future. But this ts the constitutional weakness with

the proffered interpretation by the government—it doesn’t

actually require that the taxpayer know, for instance, that

not reporting $200 to his accountant would then or later

obstruct or impede any [RS agent’s “administration of

the tax code” in a manner that could constitute a felony.

10

This was particularly the concern of the dissent below,

that the broad interpretation and application of the statute

would allow any prosecutor to say “[s]how me the man, and

I'll find you the crime.” Pet. App. 49a; see also Morrison »v.

Olson, 487 U.S. 654, 727-28 (1988) (Sealia, J., dissenting)

(quoting Attorney General Robert H. Jackson, Address

Delivered at the Sccond Annual Conference of United

States Attorneys (Apr. 1, 1940)).

This Court must, if it can, construe an Act of

Congress so as to preserve it, rather than invalidate it as

unconstitutionally vague. See U.S. Civil Serv. Comm’n

v. Nat'l Ass'n Letter Carriers, AFL-CIO, 413 U.S. 548,

571 (1973). Thus, this Court has routinely exercised its

authority to narrowly construe a statute in order to avoid

vagueness problems associated with an overly expansive

interpretation. The most analogous example is this Court’s

interpretation of the similarly-worded obstruction of

justice statute. Aguilar, 515 U.S. at 599-600 (interpreting

the obstruction of justice “omnibus clause” to require a

nexus in time, causation, or logic with a judicial proceeding,

such that the defendant must have acted with an intent to

influence a known judicial or grand jury proceeding). But

other examples abound.

In McNally v. United States, for example, this Court

curtailed the use of the mail and wire fraud statute to

prosecute cases where the mail or wires were used to

deprive the public of “intangible rights.” 483 U.S. 350,

360 (1987).4 When Congress responded by amending the

4. Prior vo this holding, courts of appeals had interpreted

the mail-fraud statute's prohibition of “any scheme or artifice to

defraud” to include deprivations of not only money or property,

11

code to state that the term “scheme or artifice to defraud”

includes a scheme or artifice to deprive another of the

intangible right of honest serviccs, 18 U.S.C. § 1346, this

Court again stepped in to interpret the statute to avoid

vagueness. Skilling v. United States, 561 U.S. 358, 402-

03 (2010). The Court limited the honest services fraud

statute to classic bribery and kickhack schemes that made

up the bulk of the pre-McNally case law, but prohibited

a more expansive reading of the statute. /d. at 408-09

(stating that “[rleading the statute to proscribe a wider

range of offensive conduct, we acknowledge, would raise

due process concerns underlying the vagueness doctrine”

and holding “that § 1346 criminalizes only the bribe-

and-kickback core of the pre-McNally case law”); see

also Arthur Andersen LLP, 544 U.S. at 703 (overturning

the conviction of the corporation whcre the government

failed tu prove the company knowingly broke the law or

acted to obstruct a specific proceeding when it continued

to implement its routine document destruction policy and

cautioning that this Court has traditionally exercised

restraint in assessing the reach of federal criminal]

statutes).

Similarly, in Yates v. United States, this Court

invoked the rule of lenity and noted that the doctrine

but also of intangible rights. See, ¢.g., Shushkan v. United States,

117 F.2d 110 (6th Cir. 1941). These holdings created the “honest

services” doctrine, which eventually resulted prosecutions for the

use of the mail system in depriving tax payers, and eventually

even corporations, of an employee or official’s “honest services.” In

McNaily, this Court narrowly interpreted the mail fraud statute

as “limited in scope to the protection of property rights,” 483

U.S. at 360, and expressly stated that “[i]f Congress desires to go

further, it must speak more clearly than it has.” /d.

12

was particularly relevant where the government urged

a “reading of [18 U.S.C.) § 1519 that exposes individuals

to 20-year prison sentences for tampering with any

physical object that might have evidentiary value in any

federal investigation into any offense, no matter whether

the investigation is pending or merely contemplated, or

whether the offense subject to investigation is criminal

or civil.” 135 S.Ct. at 1088 (citing Liparota v. United

States, 471 U.S. 419, 427 (1985) (“Application of the rule

of lenity ensures that criminal statutes will provide fair

warning[.]”)); see ewis v. United States, 401 U.S. 808,

812 (1971) (“{Almbiguity concerning the ambit of criminal

statutes should be res :ved in favor of lenity.”) (citing Bell

v. United States, 349 U.S. 81, 83 (1955)).

This Court’s prior rulings require it to reject the

yovernment’s argument for a broad reading of the statute

here.

B. The government’s interpretation of the omnibus

clause invites its arbitrary enforcement.

Petitioner’s position is simple and based in the

text. The interpretation advanced by the government

impedes clarity and uniform enforcement. Prior to 1981,

Respondent took the position that the entire 26 U.S.C.

§ 7212 statute should only be used in cases where the

defendant used physical] force or threats of force against an

IRS official. Indeed, the government even represented this

position to the courts. Williams, 644 F.2d at 699 n.12 (ina

case of first impression, discussing the government's prior

position and stating that “[aJt one time the Government

contended that § 7212 applied only to conduct involving

force or threats of force,” but that “the Government in the

13

present case has characterized its position in Henderson

as ‘timid.’”) (citing United States v. Henderson, 386 F.

Supp. 1048, 1055—56 (S.D.N.Y.1974)).

A review of the Department of Justice’s (“DOJ”)

Criminal Tax Manual (“CTM”) demonstrates the

hodgepodge of varying positions the government has

taken on when and how the omnibus clause should be

used. A 1989 directive explicitly advised against bringing

Section 7212(a) charges in garden variety tax evasion or

false return cases, stating that: “|tJhe omnibus clause

should not be utilized when other more specific charges

are available and adequately reflect the gyravamen of the

offense.” Kathryn Kencally, Column: White Collar Crime,

21 Champion 25, 25 (1997) (citing Dep’t of Justice Tax

Division Directive No. 77 (July 7, 1989), Dep’t of Justice,

Criminal Tax Manual [hereinafter CTM] §§ 3-29-3-30

(1988 ed.)).

Indeed, for many years the 1)0J Tax Division did not

even have jurisdiction within the agency to prosecute

crimes under section 7212(a). U.S. Att’ys Manual § 6-4.211

(1988), available at http://bit.ly/2xTfnAx (stating that

“Itlh Assistant Attorney General, Tax Division, has

responsibility for all criminal proceedings arising under

the interna] revenue laws except... corrupt or forcible

interference with an officer or employee acting under the

internal revenue laws (26 U.S.C. § 7212(a))”).

In the 2001 version, the CTM stated that “the use

of the ‘omnibus’ provision of Section 7212(a) should be

reserved for conduct occurring after a tax return has been

filed—typrcally conduct designed to impede or obstruct

an audit or criminal tar investigation. CTM § 17.02 (2001

ed.), available at http://coainst.org/ZepqSqQ.

14

In the 2004 edition of the CTM, the DOJ Tax Division

expanded the scope of recommended use to prosecute

“large-scale obstructive conduct involving the tax liability

of third parties,” even occurring pre-investigation.

Sorensen, 801 F.3d at 1227 (citing CTM § 3.00 (2004 ed.))

and stating that the Tax Division advised its personnel

that a charge under § 7212(a)’s omnibus clause would be

“particularly appropriate” for “corrupt conduct that is

intended to impede an IRS audit or investigation” and

‘Teould) also be authorized” for “large-scale obstructive

conduct involving the tax liability of third parties,” even

occurring pre-audit or pre-investigation). Neither of

these enforcement policies effective in 2001 and 2004, if

followed, would have included the offense charged under

the omnibus clause in this case.

The language restricting the omnibus clause to

conduct designed to impede an audit or investigation

wus eventually removed from the CTM altogether. See

John A. Townsend, Tax Obstruction Crimes: Is Making

the IRS’s Job Harder Enough?, 9 Hous. Bus. & Tax L. J.

255, 302 (2009). The current version of the CTM reflects

the unbounded interpretation offered by Respondent. By

the recommendation in the current version of the CTM,

“{sJection 7212(a) applies broadly to the variety of conduct

used to attempt to prevent the IRS from carrying out its

lawful functions” and applies to any defendant seeking

“to avoid the proper assessment and payment of taxes.”

CTM § 17.02 (2012 ed.), available at http://bit-ly/2vPiila.

Even while the CTM cautioned federal prosecutors to

constrain the use and expanse of the omnibus obstruction

statute, the government succeeded in convincing courts

that the application of the statute was almost boundless.

1d

Indeed, contrary to admonitions from this Court, lower

courts have expressly interpreted the omnibus clause

broadly. See Sorenson, 801 F.3d at 1225-26 (“[W]Je have

cited favorably other cases broadly interpreting § 7212(a)’s

omnibus clause.”); United States v. Mitchell, 985 F.2d

1275, 1279 (4th Cir. 1993) (“(TJhe inclusion of the omnibus

‘in any other way’ and ‘the due administration of this

title’ language encourage a broad rather than narrow

construction.”) (internal citation omitted); Popkin, 943

b.2d at 1538.

And with this broad interpretation have come

inconsistencies in the manner in which the statute is

applied. Under the analysis proffered by the government,

a misdemeanor offense of willfully failing file a return (for

which Mr. Marinello was also found guilty) could also be

the very act or omission constituting obstruction of the

due administration of the tax code. Certainly, it is hard

to imagine any willful failure to file a tax return that

would not also hinder the IR%’s ability to levy taxes and

otherwise administer the tax code.

The government challenges this assertion as being

“doubted” by the Second Circuit, BIO at 13, and refers

this Court to the 2012 CTM, which highlights the DOJ’s

“nolicy” to charge failures to file tax returns as standalone

offenses and not as obstructive acts. BIO at 13 (citing CTM

§ 17.04(2) (2012 ed.), available at http://bit.ly/2vPiiTa).

The government’s position in this case highlights yet

another instance in which the broad interpretation of the

omnibus clause results in arbitrary enforcement before

the lower courts. In fact, stand-alone tax offenses have

already been charged as omnibus obstruction on numerous

16

occasions where those same stand-alone offenses were

also charged as separate counts in the indictment. See

United States v. Biller, No. 06-CR-14, 2007 U.S. Dist.

LEXIS 7156, *29-80 (N.D. W. Va. Jan. 31, 2007) (“At

trial, the Government proved beyoi.a a reasonable doubt

that Biller submitted false income tax returns for tax

years 1999, 2000, 2001 and 2002. The Court finds that

the filing of false income tax returns is one method by

which Biller corruptly endeavored to obstruct or impede

the due administration of the Internal Revenue Code.”);

United States v. Armstrong, 974 F. Supp. 528, 540 (B.D.

Va. 1997)° (“While some of the charged acts in Count |

may constitute independent criminal offenses, such as

violations of § 7206(1), they are also corrupt acts that could

impair or obstruct the administration of the tax laws.”);

United States v. Toliver, 972 F. Supp. 1030, 1037 (W.D. Va.

1997) (holding, in accordance with what the government

argues here, that since a violation of 26 U.S.C. § 7206

requires proof that the defendant acted “willfully” and

a violation of the omnibus clause under 26 U.S.C. § 7212

requires that the defendant have only acted “corruptly,”

the statutes have different elements and therefore it is not

duplicative to charge 7206 violations as both stand-alone

eounts and obstructive acts under the omnibus clause);

see also United States v. Daugerdas, No. $3-09-Cr-581,

2011 U.S. Dist. LEXIS 14912, at *5 (S.D.N.Y. Feb. 7, 2011)

(holding that multiple tax charges aguinst an individual

may be the predicate for a single violation of the IRS

obstruction statute).

5. In its opinion in this case below, the Second Circuit

cited United States v. Armstrong approvingly for a different

proposition. Marinelio, 839 F.3d at 225 n.16.

17

And while charging the violation of a tax statute as

the “corrupt act” that obstructed or impeded the IRS is

readily accepted in the Fourth Circuit, such a theory has

been rejected out of hand by other courts. See United

States v. Wood, 384 Fed. App’x. 698 (10th Cir. 2010);

United States v. Mathis, No. CR-1-97-15, 1997 U.S. Dist.

LEXIS 24049 (8.D. Ohio June 2, 1997). Accordingly, while

the government here agreed to remove the violation of 26

U.S.C. § 7203 from the indictment in order to avoid duplicity

concerns, other defendants have not been so lucky. The

threat of arbitrary enforcement under the government’s

interpretation of the statute is not theoretical, it already

occurs within the circuits that have adopted the broad

reading of the statute proffered by the government here.

Even in the Second Circuit, lower courts have questioned

the propriety of the interpretation offered by Respondent

and which is now the law of the circuit. Uneted States v.

Willner, No. 07-CR-183, 2007 U.S. Dist. LEXIS 75597,

at *14-17 (S.D.N.Y. Oct. 11, 2007) (“Although both sides

purport to rely on the plain language of § 7212(a), that

language plainly does not provide a clear answer. Were

the Court writing on a clean slate, something could be

said for an interpretation that read the ‘administration’

of the Internal Revenue Code as referring to specific IRS

functions or proceedings.”).

The inconsistency is even more profound when a

prosecutor opts not to pursue a stand-alone offense and,

instead, alleges the same conduct that could give rise to

a stand-alone charge as conduct constituting obstruction.

As this Court ruled, “we must construe [an

imprisonment| statute in light of the background rules of

the common law in which the requirement of some mens

18

rea for a crime is firmly embedded.” Staples v. United

States, 511 U.S. 600, 605 (1994) (internal citation omitted);

see also Morissette v. United States, 342 U.S. 246, 250-52

(1952). With a few exceptions, this Court has adopted a

presumption in favor of construing criminal statutes to

require proof of an evil state of mind. See, e.g., Arthur

Andersen LLP, 544 U.S. at 705; Aguilar, 515 U.S. at 599;

United States v. X-Citement Video, /nc., 513 U.S. 64

(1994); Staples, 511 U.S. at 600; Ratzlafv. United States,

510 U.S. 185 (1994); Cheek v. United States, 498 U.S. 192

(1991); Liparota v. United States, 471 U.S. 419 (1985);

United States v. U.S. Gypsum Co., 438 U.S. 422, 436 (1978).

The mens rea requirements of most of the substantive

offenses of the criminal tax code are exacting. Most

of the substantive offenses in the tax code contain the

requirement that the defendant have acted “willfully” to

commit the aceused crime. A “willful” violation oecurs

where the defendant actually knew the terms of the statute

and that his conduct violated the statute. Cheek, 498 U.S.

at 201. As the Supreme Court noted in Cheek, the tax

law’s complexity and potential for ensnaring the innocent

require “the Government to prove that the law imposed

a duty on the defendant, that the defendant knew of this

duty, and that he voluntarily and intentionally violated

that duty.” /d. at 201, 205. The lower “corruptly” mens rea

requirement of the omnibus clause presents prosecutors

with an opportunity to charge conduct as “obstruction”

without having to overcome the difficulty of proving any

willful code violation.

The government’s position does nothing to truly

address this concern, that the omnibus clause swallows up

and renders moot most other provisions of the criminal tax

19

code. Indeed, the current version of the CTM, published

in 2012, lays out the endless possibilities for use of the

omnibus clause by prosecutors. CTM § 17.04(2) (2012 ed.),

available at http://bit.ly/2vPiila.

The CTM highlights that “[a]Jn endeavor may be

corrupt even when it involves means that are not illegal

in themselves,” id. § 17.04(1); “the means by which a

defendant can ‘endeavor’ to impede the due administration

of the internal revenue laws are unlimited,” 2d.

$ 17.04(2); “|t]he acts themselves need not be illegal,” 2d.

§ 17.04(1); and, “|t|he defendant need not seek a financial

benefit in order to satisfy the element of acting ‘corruptly.”

Id.

Even in so stating, the bulk of the appellate cases

referenced in the CTM necessarily involved, by the nature

of the facts of each case, defendants who actually knew

they were being audited or investigated by the IRS. /d.

(collecting cases, most of which invulved a defendant

targeting a specific IRS agent or seeking to interfere with

a specific collection action, auction of taxpayer property, or

audit); see United Slates v. McBride, 362 F.3d 360, 372 (6th

Cir, 2004) (filing fraudulent petition to place [RS revenue

agent assigned to girlfriend’s case into involuntary

bankruptcy); United States v. Valentz, 121 F.3d 327, 331-32

(7th Cir. 1997) (making statements designed tu persuade

witnesses not to talk to IRS employees or cooperate with

an IRS investigation); United States v. Madoch, 108 F.3d

761, 762 (7th Cir. 1997) (executing multiple bogus refund

schemes); United States v. Workinger, 90 F.3d 1409, 1411,

1414 (9th Cir. 1996) (submitting false financial statements

to IRS officers); United States v. Bostian, 59 F.3d 474, 479

(4th Cir. 1995) (attempting to interfere with an auction

20

of the taxpayer’s property to pay a tax debt by filing a

lis pendens action and distributing copies of the notice

to prospective buyers); United States v. Dykstra, 991

F.2d 450, 451-53 (8th Cir. 1993) (filing fraudulent Forms

1099 elaiming that defendant paid compensation to [RS

employees involved in a collection action against him);

United States v. Martin, 747 F.2d 1404, 1410-11 (11th Cir.

1984) (filing a false complaint against an IRS Revenue

Agent investigating the taxpayer).

For this reason, Petitioner’s proposed reading would

merely bring the statute back to what even the DOJ stated

it was just sixteen years ago: as a statute reserved for

conduct “typically... designed to impede or obstruct

an audit or criminal tax investigation.” CTM § 17.02

(2001 ed.). As the Court did in Skilling, it should limit

the application of the statute to the “core” of § 7212 cases

typically covered by the omnibus clause.

il. The “corruptly” mens rea requirement does not

protect the statute from vagueness concerns or

constitute a meaningful mens rea requirement.

The government argues that any constitutional

vagueness concerns are assuaged by the mens rea

requirement of the statute. The government further

asserts that the definition of “corruptly” as supplied by the

courts, does plenty to inform the average person about the

type of conduct that is criminal in the [RS’s omnipresent

administration of the tax code.

As a practical matter, however, the “corruptly” mens

rea requirement does little to cure vaguencss concerns or

restrict the omnibus clause’s application. In many ways,

21

the requirement that the defendant have acted corruptly

serves aS a mens rea requirement in name only.

The term “corruptly” is not defined in the tax code.

See 26 U.S.C. § 7701 (listing definitions). However, under

the definition adopted by most circuit courts, to act

“corruptly” is to “act with intent to gain an unlawful

advantage or benefit either for oneself or for another.”

See United States v. Reeves, 752 F.2d 995, 998 (Sth Cir.

1985); Sorenson, 801 F.3d at 1225; Saldana, 427 F.3d at

305; Kelly, 147 F.3d at 177; United States v. Wilson, 118

F.3d 228, 234 (4th Cir. 1997); United States v. Hanson, 2

F.3d 942, 946-47 (9th Cir. 1993); Popkin, 943 F.2d at 1540.

Dismissing overbreadth and vagueness concerns,

many courts, including the Second Circuit here, take

comfort in the illusory prosecutorial limits they derive

from the statutorily-undefined requirement that the

defendant have acted “corruptly” to obstruct the

administration of the tax code. Pet. App. 27a; Martello,

839 F.3d at 222 (“other courts... have decided that section

7212(a)'s ‘mens rea requirement’ sufficiently ‘restricts the

omnibus clause’s reach only to conduct that is committed

“corruptly”’””) (internal citation omitted); Kelly, 147 F.8d

at 176 (rejecting vagueness and overbreadth challenges to

7212(a) and agrecing with five other circuits in concluding

that the use of the term “corruptly” in section 7212(a)

does not render this provision unconstitutionally vague

or overbroad) (citing United States v. Brennick, 908 F.

Supp. 1004, 1010-13 (D. Mass. 1995)).

22

A. Whether the defendant had the “intent to

obtain an unlawful benefit” depends on

whether the benefit was unlawful, not on

whether the defendant knew the benefit was

unlawful.

‘The requirement that the defendant act “corruptly,”

as currently interpreted by some circuit courts, does

not expressly require proof that the defendant knew the

benefit he sought was unlawful. The “corruptly” mens

rea requirement equates to a mens rea requirement in

name only. It fails to comport with this Court’s routinely-

espoused scienter requirement. See, e.g., Elonis v. United

States, 135 S. Ct. 2001, 2009 (2015) (stating that it is a

basic principle that “wrongdoing must be conscious to

the criminal” and “a defendant must be ‘blameworthy in

mind’ before he can be found guilty”) (internal citations

omitted); Gonzales v. Carhart, 550 U.S. 124, 149-50 (2007)

(stating that mens rea requirements “alleviate vagueness

concerns” and “narrow the scope of the prohibition and

limit prosecutorial discretion”).

In United States v. Sorenson, the defendant used

a trust scheme to reduce his taxable assets by $1.5

million. He was indicted on one count—obstructing

the administration of the tax code. At trial, Sorenson

insisted that he did not know that the use of the trusts or

the reduction in tax liability was unlawful and asked the

district court to instruct the jury that, to find him guilty,

it must find that he Anew the use of the trust scheme was

illegal. 801 F.3d at 1229-30. The court refused to give

the instruction and the Tenth Circuit affirmed, stating

that “as in Williamson, we need not decide” whether the

“definition of ‘corruptly’ already requires knowledge of

illegality.” /d. at 1230.

23

As the dissent below warned, the line between

“ayy ressive tax avoidance” and “corrupt obstruction” can

be hard to discern and is often not clear. Pet. App. 45a.

Under the “corruptly” standard, as it is currently applied,

criminality hinges on the prosecutor’s ability to show a

benefit was unlawful, rather than the mental state of the

defendant at the time of the act or omission. See Julie

R. O'Sullivan, Symposium 2006: The Changing Face of

White-Collar Crime: The Federal Criminal “Code” is a

Disgrace: The Obstruction Statutes As Case Study, 96 J.

Crim. L. & Criminology 643, 673 (Winter 2006) (“While

it would be impossible—and counterproductive—to

attempt to stamp out all prosecutorial] discretion, there is

clearly a point beyond which the code’s empowerment of

prosecutors is harmful .. . [and] many former prosecutors

like me—believe that we have passed that tipping point

by a substantial margin.”).

B. Even legal acts or omissions can be criminal.

The majority of circuits also hold that under the

“corruptly” standard, even lawful conduct is criminal if

done with the intent to obtain an unlawful benefit. See

Wilson, 118 F.3d at 234 (stating that “lelven legal actions

[ean] violate § 7212(a) if the defendant commits them

to secure an unlawful benefit for himself or others”);

Bostian, 59 F.3d at 479 (posting an enlarged copy of a /zs

pendens violated 7212(a) where intended to impede the

government’s efforts to sell seized property); Popkin, 943

F.2d at 1540 (creating a company violated 7212(a) where

“at least one intent in creating the corporation was to

secure an unlawful benefit on his client”); accord United

States v. Kahre, No. 05-CR-121, 2009 U.S. Dist. LEXIS

39473, at *9-11 (D. Nev. Apr. 20, 2009) (while buying

24

property in a family member’s namc is not, in and of itself,

illegal, defendants could properly be convicted under

§ 7212(a) if they were motivated by a desire “to secure an

unlawful benefit for oneself or for another”); Biller, 2006

U.S. Dist. LEXIS 100493, at *13 (“The acts themselves

need not be illegal. Even legal actions violate § 7212(a) if

the defendant commits them to secure an unlawful benefit

for himself or others.’”) (citing United States v. Bostian,

59 F.3d 474, 479 (4th Cir. 1995)).

This Court has cautioned that restraint in assessing a

federal criminal statute’s reach is particularly important

where the act underlying the conviction is, by itself,

innocuous. Arthur Andersen LLP, 544 U.S. at 703-04.

Under the Second Circuit’s panel decision here,

even doing nothing at all can be criminal if done with an

intent to obtain an unlawful benefit. Marinello, 839 F.3d

at 225 (holding that “an omission may be a means by

which a defendant corruptly obstructs or impedes the due

administration of the Internal Revenue Code”); see also

Armstrong, 974 F. Supp. at 531 (alleging the defendant

withheld material information from his tax return preparer

with regard to his travel expense reimbursements and

income); United States v. Bezmalinovic, No. $3-96-CR-97,

1996 U.S. Dist. LEXIS 18976, at *5-6, (S.D.N.Y. Dee.

26, 1996) (alleging the defendant failed to report salary

payments to certain employees “in any IRS Form W-2”

or “to remit to the IRS the [payroll and unemployment]

taxes] due and owing”).

The current application of the “corruptly” standard

fails to narrow the statute’s broad sweep or address this

Court’s perennial concerns about providing fair warning

25

of what constitutes criminal conduct. See Arthur Andersen

LLP, 544 U.S. at 703.

C. The “unlawful benefit” docs not need to be a

tax benefit.

Under the law in some circuits, the “unlawful benefit”

sought by the defendant does not even need to be a benefit

under the tax code. In other words, the omnibus clause

could be used to prosecute a person who obstructs the

administration of Title 26 with the intent to seek any

unlawful benefit. U/nited States v. Giambailvo, 810 F.3d

1086, 1098 (8th Cir. 2016) (rejecting the argument that

“the term corruptly is limited to situations in which

the defendant wrongfully sought or gained a financial

advantage’”) {internal citation omitted); Saldana, 427

F.3d at 306 (holding that 7212(a) does not require that

the defendant obtain benefits or advantages “under the

tax laws” and upholding the conviction where Saldana

filed reports with the IRS documenting false transactions

with targeted individuals in astronomical amounts in the

hope it would lead the IRS to audit those individuals);

United States v. Bowman, 173 F.3d 595, 596-97 (6th Cir.

1999) (affirming a defendant’s conviction for violation of §

7212(a) when the defendant had filed false 1099 and 1096

forms for the sole purpose of intimidating and harassing

his creditors and finding that the defendant’s conduct fel!

within the ambit of § 7212(a)’s proscribed conduct even

though he sought no financial advantage or benefit for

himself under the tax laws).

In this regard, under current authority from the

lower courts, the omnibus clause of section 7212(a) has

reached far beyond conduct directed at IRS employees.

26

See Keneally, White Collar Crime, supra, at 26, 28

(stating that “somewhat troubling[ly], however, the

government and some courts have .. . expanded{cd] the

reach of Section 7212(a) to circumstances in which the

harassing conduct was not directed at IRS employees,

but at other government employees or private citizens,”

notwithstanding the DOJ Tax Division's policy directive

(current as of 1997), limiting prosecutions to “conduct

directed at IRS personne] in the performance of their

duties, or in the context of an on-going investigation or

proceeding”).

Title 26 covers all individuals and entities and governs

transactions ranging from nonprofit creation, 26 U.S.C.

§ 501 et seq., to financing presidential campaigns, 26

U.S.C. § 9001 et seg., and taxing the sale of firearms. See

26 U.S.C. § 5801 et seg. Without even a requirement that

the unlawful benefit obtained by the defendant be related

to the tax code, and no requirement that the defendant

actually intended to obstruct the administration of the

tax code, see Part II.D infra, it is easy to imagine the

myriad of conduct that could ultimately be alleged in an

indictment to have impeded the administration of Title 26.

Under Respondent’s interpretation, an indictment under

the omnibus clause could follow from any civil violation

by a nonprofit, any regulatory violation for a gun sale,

or a campaign finanee infraction. See United States v.

Yagow, 953 F.2d 423, 425-27 (8th Cir. 1992) (noting only

that the defendant sought a financial advantage, not an

advantage under the tax laws, by filing fraudulent IRS

forms where defendant sent fraudulent IRS forms to

individuals involved in repossessing his property during

a bankruptcy action and to individuals involved in a state

prosecution against his son for aleohol possession); United

27

States v. Allison, 264 Fed. App’x. 450, 451 (Sth Cir. 2008)

(upholding a conviction under the omnibus clause where

the defendant filed IRS forms indicating that the police

officer, city officials, and municipal judge involved in a

traffic case against him had received billions of dollars

in eash to presumably obtain a benefit in his case against

them).

Similarly, prosecution under section 7212(a) docs

not require proof of a tax deficiency. See Giambalvo,

810 F.3d at 1097; Floyd, 740 F.3d at 32 (“A conviction for

violation of section 7212({a) does not require proof of... a

tax deficiency.”).

D. The act or omission need not even actually

obstruct or impede the administration of the

tax code or be carried out with the intent to

obstruct or impede the administration of the

tax code.

In Popkin, one of the seminal § 7212 circuit court cases

relied upon by the government, there was no evidence that

the only aet charged in the redacted indictment—-creating

a California corporation for another person to disguise the

character of illegally earned money and repatriate it—

either actually did obstruct, or was intended to obstruct,

the due administration of the Internal Revenue Code.

943 F.2d at 1538. Instead, the court held that that Popkin

acted corruptly “because at least one intent in creating

the corporation was to secure an unlawful benefit for his

client.” /d. at 1540.

At the time, money laundering was not a crime, and

as the dissent in Popkin pointed out:

Vs

(Tjhe indictment alleges only that the

defendant created a corporate entity for the

purpose of disguising illegal income in violation

of Title 26. The indictment does not allege and

the Government even now does not satisfactorily

explain how this without more violates the tax

laws. Although the illegal nature of the funds

would have been suecessfully concealed, [the

third party] still could have paid any tax

obligations owed on the money without violating

the tax laws at all.

bad

The court’s interpretation of this section of the

tax law has the effect of virtually eliminating the

word “corruptly” from the statute. The statute

requires that the defendant must “corruptly”

obstruct or endeavor to obstruct the execution

of the tax laws. This should mean something

more than just obstructing the execution of

the laws as a matter of fact. There is nothing

inherently “corrupt” about the formation of a

corporation.

Jd, at 1541-42 (Roney, J., dissenting). By the government’s

reading of the statute, there is simply no nexus between

the “corrupt” act or omission and any actual obstruction

or intent to obstruct the administration of the tax code

at the time of that act or omission. See Aguilar, 515 U.S.

at 599 (holding that under section 1503 the act must

have a “relationship in time, causation, or logic” or the

“natural and probable effect” of interfering with the due

administration of justice).

2Y

The Respondent seeks to nullify this requirement by

its argument that individuals are always on notice that the

IRS is administering the tax code and should thus always

be aware of their potential to obstruct it. See BIO at 9.

This argument has been rejected by at least one court.

See United States v. Oghazion, No. 15-CR-104, 2016 U.S.

Dist. LEXIS 148358, at *47-50 (S.D. Ohio Oct. 17, 2016)

(applying Sixth Circuit law, rejecting the government's

argument that defendant did have knowledge that his

conduct would obstruct an IRS action because his company

had “hundreds of locations, hundreds of employces, and

by its nature, [was] continually subject to IRS scrutiny

and review” and dismissing the count brought under the

omnibus clause). And it further highlights the need for this

court to cabin the omnibus clause’s application to cases

where the defendant had knowledge of an IRS action,

audit, or investigation. See Kassouf, 144 F.3d at 955. The

statute is simply too broad as applied by the majority

interpretation, and should be narrowed by this Court.

30

CONCLUSION

For the foregoing reasons, the Court should vacate

Mr. Marinello’s conviction under the omnibus clause of 26

U.S.C. § 7212(a), reverse the Second Circuit, and remand

for proceedings consistent with this Court’s order.

Respectfully submitted,

JosHua L. DRATE!. JOHN VECCHIONE

Co-Chair Amicus Erica L. MarsHALL*

Committee CAUSE OF AcTION INSTITUTE

NATIONAL ASSOCIATION OF 1875 Eye Street N.W.

CRIMINAL DsFrENSE LAWyeRS Washington, D.C. 20006

1660 L Street N.W. (202) 499-4232

Washington, D.C. 20036 erica.marshall@

(202) 872-8600 causeofaction.org

*Counsel of Record

Counsel for Amici Curiae