Opposition Brief — MacLeod v. United States

In the Supreme Court of the Gnited States

OcToBER TERM, 1970

No. 1582

DovGcuas MAcLEov, PETITIONER

v.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE FIGHTH CIRCUIT

ERIEF FOR THE UNITED STATES IN OPPOSITION

OPINION BELOW

The opinion of the court of appeals affirming the

judgment of conviction (Pet. App. A-1-A-5) is not yet

reported. |

JURISDICTION

The judgment of the court of appeals (Pet. App.

A-6) was entered on January 25, 1971, and the

petition for a writ of certiorari was filed on Febru-

ary 23, 1971. The jurisdiction of this Court is invoked

under 28 U.S.C. 1254(1).

QUESTIONS PRESENTED

1. Whether the evidence was sufficient to support

the verdict.

(1)

420-023—-71

VPLS EEL ASE NLA ATi RBS cle, as

-_

2. Whether the trial court erred in permitting the

government to introduce evidence of specific items of

income in view of petitioner’s willingness to stipulate

that he had sufficient income to require the filing of

income tax returns.

3. Whether the trial court properly excluded evi-

denee of petitioner’s political background at a pre-

trial hearing.

4. Whether the special agent should have given

petitioner full Miranda warnings of his constitutional

tights even though he was not in custody or otherwise

deprived of his freedom of action.

5. Whether the trial court erred in charging the

jury on the element of willfulness.

STATUTE INVOLVED

Section 7203 of the Internal Revenue Code of 1954,

26 U.S.C. 7203, provides:

7203. Willful failure to file return, supply

information, or pay tax.—Any person required

under this title to pay any estimated tax or

tax, or required by this title or by regulations

made under authority thereof to make a return

(other than a return required under authority

of section 6015 or section 6016), keep any ree-

ords, or supply any information, who willfully

fails to pay such estimated tax or tax, make

such return, keep such records, or supply such

information, at the time or times required by

law or regulations, shall, in addition to other

penalties provided by law, be guilty of a mis-

demeanor and, upon conviction thereof, shall

be fined not more than $10,000 or imprisoned

not more than 1 year, or both, together with the

costs of prosecution.

STATEMENT

After a jury trial in the United States District

Court for the Eastern District of Missouri, petitioner

was convicted on three counts of willfully failing to

file income tax returns for the years 1963, 1964 and

1965, in violation of 26 U.S.C. 7203. On Count I

(1963) he was fined $10,000 and sentenced to one year

in prison; on Counts IT and ITI (1964 and 1965) he

was sentenced to five years’ probation (App. 3-5, 13,

67).

The government’s proof showed that, while income

tax returns were required of all persons with gross

income in excess of $600 during these vears, petitioner

(a practicing lawyer) had filed no returns (App. 17)

even though his income was as follows (App. 18):

Year (:ross receipts Net income

Ul TAS Soe ery ys Oe as Poe : 3 ; . $34, 183. 22 $29, 728. 69

1964.... _. Se pes 34, 962. 50 10, 826. 51

RYO ke , esi ; . 19, 200. 90 13, 157. 11

Petitioner advised the Treasury agents that he had

three reasons for not filing his tax returns, namely,

procrastination, a sloppy way of doing business, and

personal preblems (App. 22). Petitioner explained

that his personal problems related to his heavy drink-

ing (App. 23); that there were periods in which he

was not lucid for a week or more, and that some of

his cases had to be postponed because he was unable

to appear in court at the scheduled times (App. 23).

Petitioner had filed returns for many vears preceding

1963 (Tr. 156-159).

ARGUMENT

1. Petitioner argues, in effect, that the evidence of

willfulness in this case is not as strong as that in some

other failure-to-file cases (Pet. 18-21) and that the

jury should have accepted his contention that his fail-

ure was not willful but, instead, that it resulted from

“sloppiness, personal problems [drinking] and _ pro-

crastination” (Pet. 20). Willfulness is rarely prov-

able by direct evidence, and may be inferred by the

finder of fact in a proper case. Here the jury was

entitled to consider that during the years in question

petitioner realized very substantial net, as well as

gross, income from his law practice (supra, p. 3); that

after the investigation began petitioner sat down with

his accountant and in only two or three days they had

reconstructed his income and expenses for the three

vears (Tr. 32, 37, 41, 48, 49, 61, 140, 145); that peti-

tioner’s desk was fairly orderly with papers stacked

neatly (Tr. 50); that petitioner kept track of his ap-

pointments and had someone else cover them if he

was unable to do so (Tr. 130); that on a number of

matters which petitioner handled during the years in

question he was able to perform, and did perform, all

the funetions of a lawyer (Tr. 162-167, 193) ; and that

for many vVears prior to 1963 petitioner, with the same

bookkeeping system, did file income tax returns (Tr.

156-159). Thus, there was ample evidence to sustain

the conclusion of both courts below that petitioner’s

failure to file returns for the years 1963 through 1965

was willful.

5

2. The trial court properly admitted proof of spe-

cific items of income despite petitioner’s willingness

to coneede that he had received substantial gross in-

come in each of the years. This evidence was pertinent

to the issue of willfulness as tending to show that

petitioner’s alleged sloppiness and drinking problem

did not prevent his earning large stuns from his prac-

tice of law during the three years. Lumetta v. United

States, 362 F. 2d 644, 645-646 (C.A. 8).

3. Petitioner urges (Pet. 31-33) that the trial court

erred, in the course of a pre-trial hearing, in exclud-

ing evidence hearing upon petitioner's “political back-

ground’? which might have shown that the prosecu-

tion was politically motivated. Petitioner’s political

background, however, was wholly irrelevant to any

issne before the court. Furthermore, there was no

offer of proof as to what petitioner intended to show

and the contention is so vague that petitioner even

now provides no clue as to what his ‘*politieal back-

ground” is and how that might have influenced his

prosecution.’

4. Petitioner argues (Pet. 33-36) that the special

agent of the Internal Revenue Service was required

to give petitioner the full warnings of his constitu-

tional rights set forth in Miranda v. Arizona, 384 U.S.

436. But since petitioner was not in custody nor other-

wise deprived of his freedom in any significant way,

the requirements of Miranda did not apply. This is

1 This is one of the several issues disposed of by the court

below with the comment that they were “frivolous (Pet. A—,

A-5).

in aeceordance with the rule in the Eighth Circuit,

Cohen v. United States, 405 F. 2d 34 (C.A. 8), cer-

tiorari denied, 394 U.S. 943, and in eight other cir-

enits, Morgan v. United States, 377 F. 2d 507, 508

(C.A. 1); United States v. White, 417 F. 2d 89 (CLA.

2), certiorari denied, 397 U.S. 912; United Stutes v.

Jashiewicez, 433 F. 2d 415, 417-420 (CLA. 3): United

States v. Mancuso, 3578 . 2d 612, 619 (CLA. 4), cer-

tiorari denied, 390 U.S. 955: Agoranos ve United

States, 409 F. 2d $33, 835 (CLA. 5), certiorari denied,

396 U.S. 824: United States v. Miriani, 422 F.2d 150,

153-154 (CUA. 6), certiovart denied, 399 U.S. 910:

Feichtmetr v. United States, 389 F.2d 498 (CLA. 9):

Hensley v. United States, 406 F. 2d 481, 484 (CLA.

10).

Petitioner asserts, as have the petitioners in a num-

ber of other cases mm which this Court has denied cer-

tiorari, a conflict with United States vy. Dickerson, 418

IF’. 2d 1111 (CLA. 7). In Dickerson, the Seventh Circuit

held that a taxpayer must be given Miranda warnings

“at the inception of the first contact with the taxpayer

after the ease has been transferred to the Intelligence

Division” (p. 1117). But this rule was made applicable

only to “interrogations taking place after the date of

this decision,” July 28, 1969 (p. 1117), long after the

evidence in petitioner’s case was turned over to the

agents. Moreover, it is the present policy of the Inter-

nal Revenue Service to give virtually full Miranda

warnings to all taxpayers when they are first inter-

7

viewed by a special agent.’ Thus, there should be few,

if any, future eases which will meet a different fate in

the Seventh Circuit than in any other circuit. See, ¢.g.,

United States v. Campione, 416 F. 2d 486 (C. A. 7),

certiorari denied, 357 U.S. 909.

5. There is no substance in the contention (Pet. 36-

46) that the trial court erred in instructing the jury

on the question of willfulness and in refusing certain

requested instructions on the same subject. The court

charged the jury as follows (App. 8):

The word “willful” as used in the statute in-

volved in this case means voluntary, purposeful,

deliberate, and with the specific intent to do that

which the law forbids as distinguished from ac-

cidental, inadvertent or negligent. The require-

ment that failure to make and file the returns in

auestion be dene willfully exists so that the ae-

cused will not be convicted of failing to make

wv file such returns because of mistake or in-

advertence. If the jury believes that the defend-

ant acted with negligence, inadvertence, mistake,

or due to his good faith misunderstanding of the

requirements of the law, his act was not willful.

2 By news release dated November 26, 1968, the Internal Rev-

enue Service announced that henceforth a special agent on his

first visit to a taxpayer must. warn him of his constitutional

rights, including the right to counsel, but not including the

proffer of legal aid wnless the taxpayer is in custody. The news

release notes that this “new procedure goes beyond most legal

requirements that are designed to advise persons of their

rights.” 1968 CCH Fed. Tax Reporter, par. 6946: 1968 Pren-

tice-Hall Fed. Taxes, par. 55.476.

8

On the other hand, if his act was done with bad

purpose either to disobey or disregard the law

then his act was willful. In this connection you

are instructed that the only bad purpose or evil

motive which the Government must prove in this

case is the deliberate intention not to file a re-

turn which the defendant knew the law required

him to file so that the Government would not

know the extent of his liability.

This instruction has been approved by every circuit

which has ever been asked to pass upon its pro-

priety. United States v. Cirillo, 251 F. 2d 638

(C.A. 3), certiorari denied, 356 U.S. 949; Haskell v.

United States, 241 F. 2d 790, 79+ (C.A. 10), certiorari

denied, 354 U.S. 921; United States v. Gorman, 393 F.

2d 209, 213 (C.A. 7), certiorari denied, 393 U.S. 832;

Ryan v. United States, 314 F, 24 306, 310, fn. 3 (CLA,

10); cf. Spies v. United Stctes, 317 U.S. 492, 497-498.’

* Petitioner makes the contention (Pet. 46-49) that the trial

judge committed reversible error in denying him access to the

presentence report. Although the court had the power, under

Rule 32(¢c) (2) of the Federal Rules of Criminal Procedure, to

permit examination of the report, it is perfectly clear from the

language of the rule and the decided cases that the matter is

one of discretion in the trial court. Vnited States v. Crutcher,

405 F. 2d 239, 245 (C.A. 2), certiorari denied, 394 U.S. 908;

Baker v. United States, 388 F. 2d 931, 983 (C.A. 4): Roeth v.

United States, 380 F. 2d 755, 757 (C.A. 5), certiorari denied,

390 U.S. 1015.

Kqually insubstantial is the argument (Pet. 49-57) that Con-

gress lacks the power, because of constitutional inhibitions, to

proscribe criminally the willful failure to file an income tax

return. United States vy. Sullivan, 274 U.S. 259. (And see Pet.

App. A-.5)

9

CONCLUSION

For the reasons stated, the petition for a writ of

certiorari should be denied.

Respectfully submitted.

ERwWIN N. GRISWOLD,

Solicitor General.

JOHNNIE M. WALTERS,

Assistant Attorney General.

CromBiE J. D. GARRETT,

JOHN P. BuRKE,

RicHarp B. BUHRMAN,

Attorneys.

Marcu 1971.

U.S. GOVERNMENT PRINTING OFFICE: 1971