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

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0738%3A11

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2017

## Text

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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

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0738%3A11. Public record. Not legal advice.