Brief for the United States — Ming v. United States

INDEX

Page

a 1

Jurisdiction .........0.. 000 eee. 1

Questions presented .........0................, 2

Statutes involved ............0000. 0000, 2

Statement.......... cece. 2

Argument..... 6.62... 4

Conclusion ............................02...., 12

Appendix... 13

CITATIONS

Cases:

Berger v. United States, 255 U.S.22........ 12

Hamner v. United States, 315 F.2d 792 ....... 7,8

Miranda v. Arizona, 384 U.S.486........... 11

Nestlerode v. United States,122F.2d56...... 9

Rosen v. Sugarman, 357 F.2d 794........... 12

Sansone v. United States, 380 U.S. 343 .. 4,5,6,7

Spies v. United States, 317 U.S.492 ....... 4,5,6

United States v. Fahey, 411 F. 2d 1213, cer-

tiorari denied, 396 U.S. 957 .............. 8

United States v. Matosky, 421 F. 2d 410, cer-

tiorari denied, 398 U.S. 904.............. 11

United States v. Miriani, 422 F. 2d 150, cer-

tiorari denied, 399 U.S.910.............. 11

United States v. Murdock, 290 U.S. 389 ..... 45

United States v. Platt, 485 F.2d 789 .....__. 5

United States v. Prudden, 424 F. 2d 1021, cer-

tiorari denied, 400 U.S. 831 .............. 11

United States v. Vitiello, 363 F.2d 240... __. 7,8

United States v. White, 417 F. 2d 89, certiorari

denied, 397 U.S. 912 .................... 11

MEANT OT TENE YR OT oY EM YON GEIR oe OY) aba

Statutes:

Internal Revenue Code of 1954 (26 U.S.C.) :

In the Supreme Court of the Anited States

OcroseR TERM, 1972

No. 72-152

Wuuum R. Mina, JR., PETITIONER

v.

Unrrep Stares oF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR

THE SEVENTH CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

QPINION BELOW

The opinion of the court of appeals (Pet. App. 1a-

16a) has not yet been officially reported.

FERISDICTION

The judgment of the court of appeals was entered

on May 26, 1972, and a petition for rehearing was

denied on June 26, 1972, (Pet. App. la, 17a.) The

petition for a writ of certiorari was filed on July 26,

1972. The jurisdiction of this Court is invoked under

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

QUESTIONS PRESENTED

1. Whether the trial court correctly instructed the

jury concerning the element of willfulness in 26 U.S.C.

7203.

2. Whether petitioner was denied a fair trial by

reason of the introduction in evidence of an Internal

Revenue Service certificate of assessments and pay-

ments.

3. Whether the trial court errec in limiting peti-

tioner to three peremptory challenges.

4. Whether petitioner was denied due process by rea-

son of certain rulings, instructions, and comments of

the trial judge, or by a question asked by the prosecutor.

5. Whether the trial judge abused his discretion in

denying petitioner’s pretrial motion requesting that

the judge recuse himself on the ground of bias and

prejudice.

STATUTES INVOLVED

Sections 7201 and 7203 of the Internal Revenue Code

of 1954 (26 U.S.C.) and Rule 24(b) of the Federal

Rules of Criminal Procedure are printed in the Ap-

pendix, infra, pp. 13-14.

STATEMENT

After a jury trial in the United States District

Court for the Northern District of Illinois, petitioner

was convicted on all counts of a four-count information

charging that he willfully failed to file timely federal

income tax returns for the years 1963, 1964, 1965, and

1966, in violation of Section 7203 of the Internal

Revenue Code of 1954. He was sentenced to consecutive

3

four-month terms and to $1,250 fines on each of the

fovr counts. It is undisputed that petitioner, a lawyer,

failed to file returns for those years when they were

due and that his gross income required him to file re-

turns. Petitioner’s evidence was directed to whether his

failure to file was willful, within the meaning of Section

7203. (Pet. App. la-3a.)

Petitioner conceded that when each return here in-

volved was due, he was aware that it was due, yet failed

to file it (R. 168).* The returns here involved were not

filed until October 1967 (R. 48-49). Petitioner had ex-

plained to a revenue agent that he was too busy to file

returns (R. 47-49).

The trial court instructed the jury that the essential

elements of a violation of Section 7203 are (1) that

the defendant be a person who is required by law to

make a return, (2) that the defendant failed to make a

return at the time required by law, and (3) that such

failure must be found to have been willful (R. 252).

The court instructed that when used in Section 7203,

“the word ‘willful’ means ‘voluntary, purposeful, delib-

erate and intentional as distinguished from accidental,

inadvertent or negligent’’’ (R. 253-254). The court

stated further (R. 254) :

I charge you that the only bad purpose necessary

for the government to prove in this case is the

deliberate intention not to file returns which the

defendant knew he was required to file at the time

he was required to file them.

***R.”’ refers to the record appendix filed in the court of appeals.

4

ARGUMENT

1. Petitioner contends (Pet. 12-20) that the courts

below erred in their interpretation of the word, ‘‘will-

fully,’’ as used in Section 7203 of the Internal Revenue

Code of 1954, Appendix, infra, which makes it a mis-

demeanor if any person, inter alia, ‘‘willfully fails to

* * * make such return * * * at the time or times

required by law or regulations.’’ Petitioner urges that

Section 7203 should be limited to those who ‘“‘have a

criminal intent when they fail to comply with the tax

laws”? (Pet. 13), and defines such intent as the same

intent as in the case of a defendant charged with the

felony of willfully attempting to evade a tax, proscribed

by Section 7201 of the Code (Pet. 15).’

(a) The jury was correctly instructed on the mean-

ing of willfulness in Section 7203, viz., that it means

‘‘voluntary, purposeful, deliberate and intentional as

distinguished from accidental, inadvertent or negli-

gent’’ (R. 253-254), and that the only bad purpose re-

quired for conviction is ‘‘the deliberate intention not

to file returns which the defendant knew he was re-

quired to file at the time he was required to file them’’

(R. 254). This instruction is completely in accord

with the views of this Court (see Spies v. United States,

317 U.S. 492, and Sansone v. United States, 380 U:S.

343) and is not in conflict with United States v. Mur-

2 The amici brief simply asserts (Br. 5-6) that there is confusion

and conflict among the circuits (an essentially mistaken impres-

sion, as we shall show), without suggesting any more proper ander-

standing of the willfulness element.

5

dock, 290 U.S. 389, as petitioner contends (Pet. 13-

15).°

In Spies v. United States, supra, this Court stated

that a deliberate failure to file a timely return consti-

tutes a violation of Section 7203, regardless of whether

any tax is due. And in Sansone v. United States, supra,

this Court recognized (380 U.S. at 354) that ‘an intent

to report and pay the tax in the future does not vitiate”’

the willfulness requirement of Section 7203. These

opinions clearly indicate the error of petitioner’s con-

tention (Pet. 15) that willfulness within the meaning of

Section 7203 necessarily involves an intent to evade

the payment of tax.‘

In Spies, this Court explained why a criminal sane-

tion is needed to enforce the timely filing of tax returns,

whether or not a tax is owed, stating (317 U.S. at

495-496) :

*In United States v. Murdock, supra, the petitioner was prose-

cuted for willfully failing to supply information to a revenue agent.

He had declined to do so, invoking the privilege against self-in-

crimination. This court held that there was no offense if the

petitioner believed in good faith that, in view of the constitutional

privilege, he had the right to refuse to supply the information.

Obviously, the present case is entirely distinguishable, since peti-

tioner has never asserted that he believed that he had a right not

to file his income tax returns on time and the jury was instructed

that there wmst be a ‘‘deliberate intention not to file returns which

the defendant knew he was required to file * * *”’ (R. 254, em-

phasis added).

*In United States v. Platt, 435 F. 24 789, 793-795 (C.A. 2),

involving instructions similar to those given in the present case,

Judge Friendly’s opinion for the court succinctly demonstrated the

correctness of such instructions in light of Spies and Sansone.

6

The failure in a duty to make a timely return,

unless it is shown that such failure is due to rea-

sonable cause and not due to willful neglect, is

punishable by an addition to the tax of 5 to 25

per cent thereof, depending on the duration of the

default. § 291 of the Revenue Act of 1936 and ot

the Internal Revenue Code. But a duty may exist

even when there is no tax liability to serve as a base

for application of a percentage delinquency pen-

aity ; the default may relate to matters not identifi-

able with tax for a particular period; and the

offense may be more grievous than a case for civil

penalty. Hence the willful failure to make a re-

turn, keep records, or supply information when

required, is made a misdemeanor, without regard

to existence of a tax liability. § 145 (a). Punc-

tuality is important to the fiscal system, and these

are sanctions to assure punctual as well as faithful

performance of these duties.‘

Petitioner is mistaken in suggesting (Pet. 15-17)

that Sansone supports his criticism of the jury instruc-

tion here involved. The portion of the Sansone opinion

which petitioner quotes (Pet. 15-16) demonstrates

merely that, on the facts of a particular case, there may

be a violation of both Sections 7201 and 7203, with no

differentiating fact to be found by the jury (and hence

no need for a lesser included offense instruction). That

*In making a specified amount of gross income the touchstone

of the requirement that a return be filed (see Section 6012(a) (1)

of the Code), Congress obviously intended to supply the revenue

authorities with timely information from which they, rather than

solely the taxpayer, could ascertain whether a tax liability exists.

a

was so in Sansone, since the charge was that the peti-

tioner had intentionally omitted certain income from

his return which he knew he should have included.’ It

does not follow that every violation of Section 7203

will also be a violation of Section 7201, or that there

must always be an intent to evade a tax for a violation

of Section 7203. As already shown, where the offense is

a failure to file a return at the time required by law,

there need be no intent to evade tax, because the offense

is committed even though no tax is due.

(b) Petitioner (Pet. 17) and the amici curiae (Br.

6) assert the existence of a conflict among the courts

of appeals, citing Haner v. United States, 315 F. 2d 792

(C.A. 5), and United States v. Vitiello, 363 F. 2d 240

(C.A. 3). Those opinions, however, do not indicate that

either the Third or the “ifth Circuit would, on the facts

of this case, have reached a conclusion different from

that of the court below. In both cases, the reversals

were based on the belief that the jury instructions

(permitting conviction on a finding of ‘‘careless disre-

gard’”’ of a legal duty) permitted conviction merely on

a finding of a careless or negligent failure to file returns.

Here, in contrast, the jury was explicitly instructed

that ‘‘willful’’ does not mean ‘‘accidental, inadvertent

or negligent’’ (R. 253-254).

Petitioner and the amici curiae also refer (Pet. 17;

Br. 6) to cases in the Ninth Circuit. The only difference

suggested by the Ninth Circuit cases, however, lies in

* By so doing, the petitioner had willfully failed to pay his taxes

at the time required by law, in violation of Section 7203 (380 U.S.

at 345), but the same facts also showed a willful attempt to evade

tax in violation of Section 7201.

A i i Re a

8

the fact that the Ninth Circuit sanctions a form of

instruction which is less favorable to a taxpayer

charged with a failure to file a timely return. See

United States v. Fahey, 411 F. 2d 1213, 1214, certiorari

denied, 396 U.S. 957, where the Ninth Circuit reaffirmed

its approval of instructions defining ‘‘willfully”’ as

‘‘without grounds for believing that one’s act is lawful

or without reasonable cause, or capriciously or with a

careless disregard whether one has the right so to act.”’

As the Ninth Circuit noted (411 F. 2d at 1214), this

type of instruction was rejected by the Fifth and Third

Circuits in Haner and Vitiello, supra. It was also, in

effect, rejected in the instant case, as we have shown.

Obviously, petitioner has no basis for seeking further

review, merely because he received more favorable jury

instructions than he might have if he had been prose-

cuted within the Ninth Circuit.’

2. Petitioner misinterprets the evidence at the trial in

contending (Pet. 20-26) that he was prejudiced by the

introduction of a certificate (Pet. App. 18a) concerning

his tax assessments and payments. The jury could not

have been led to believe from that certificate that peti-

tioner had never filed the returns—as he concededly did,

albeit untimely. The Revenue Service employee who

prepared the certificate explained in her testimony that

she had searched only for records of returns filed on

time (R. 57-69). Similarly, the prosecutor in his closing

statement argued merely that petitioner had consist-

7 Thus this case need not be held for disposition of United States

v. Bishop, No. 71-1698, in which the government seeks to challenge

the Ninth Cireuit rule in the context of a lesser-included offense

instruction.

9

ently failed to file his returns when they were due (R.

223).

3. Petitioner asserts (Pet. 26-29) that he was preju-

diced because the trial court permitted each side only

three peremptory challenges to the jury. He contends

that Rule 24(b) of the Federal Rules of Criminal Pro-

cedure (App. infra, p. 14) should be interpreted to

require allowance of a larger number. Reasonably in-

terpreted, however, Rule 24(b) simply distinguishes

between felonies and misdemeanors, granting the de-

fendant ten peremptory challenges in a felony trial and

three in a trial for a misdemeanor. Petitioner cites no

authority for his view (Pet. 27) that a trial on several

misdemeanor counts creates a right to exercise more

peremptory challenges. Contrary to petitioner’s con-

tention is Nestlerode v. United States, 122 F. 2d 56,

58-59 (C.A. D.C.).

4. Petitioner cites a number of alleged trial errors

(Pet. 29-33) in support of the broad assertion that he

suffered ‘‘a general denial of due process of law”? (Pet.

29). The criticisms are without merit.

(a) Both the petitioner (Pet. 31) and the amici

curiae (Br. 6-8) complain of the fact that the trial

court admitted ‘‘evidence of previous failure to file

timely returns’’ (Pet. 31), but excluded evidence prof-

fered by petitioner to show that he paid his taxes before

the initiation of prosecution. The amici curiae contend

that these rulings are inconsistent and reveal “‘incon-

sistent constructions’’ of Section 7203 by the courts be-

low (Br. 7-8).

Both rulings were correct. Evidence that petitioner

10

ultimately and belatedly paid his taxes might be rele-

vant if an intention to evade tax were an element of the

misdemeanor here involved, but, as we have shown, that

clearly is not the case.* On the other hand, the evidence

of a past history of belated filing of returns was prop-

erly admitted (R. 62, 64), as showing a ‘‘pattern of

conduct’’ (R. 62). This evidence, although hardly es-

sential to the government’s case, had a tendency to

show that the late filing of the returns specified in the

indictment was not ‘‘accidental, inadvertent or negli-

gent’’ (R. 254). Its admission did not depend upon

adoption of petitioner’s theory (Pet. 15) that Section

7203 requires an intent to evade the payment of taxes.

(b) Petitioner complains (Pet. 29-30) of the fact

that when he was interviewed by revenue agents at his

own law office in November 1967, he was not advised of

his constitutional rights and was not so advised until

some later date. Suffice it to say that this case, involving

a lawyer, is hardly a suitable vehicle for reviewing the

question whether Miranda v. Arizona, 384 U.S. 436,

should be extended to noncustodial interviews by rev-

enue agents. This Court has frequently declined to re-

view that proposition. See, e.g., United States v. White,

® The particular point of dispute at the trial involved an effort

by the defense to introduce in evidence five checks showing pay-

ments by petitioner to the Internal Revenue Service (R. 159).

The court excluded the checks, observing that ‘‘the fact of pay-

ment is not an issue’? (R. 162). Evidence had already been ad-

mitted, showing that petitioner’s returns for 1964, 1965, and 1966

were filed on October 11, 1967 (R. 42-43). There had also been

evidence of the late filing of other returns (R. 76). There was

evidence that petitioner had come under tax investigation and that

revenue agents had communicated with him before he filed the

various returns in question (R. 42, 74).

__ ae 1

417 F. 2d 89 (C.A. 2), certiorari denied, 397 U.S. 912;

United States v. Miriani, 422 F.2d 150, 153-154 (C.A.

6), certiorari denied, 399 U.S. 910; United States v.

Prudden, 424 F.2d 1021 (C.A. 5), certiorari denied, 400

U.S. 831; United States v. MacLeod, 436 F. 2d 947

(C.A. 8), certiorari denied, 402 U.S. 907. Similarly,

this case is not a suitable one for considering the

impact of the Internal Revenue Service regulation

(Pet. 29-30), adopted only a few weeks before peti-

tioner was interviewed, requiring that certain warnings

should be given ‘‘If the potential criminal aspects * * *

are not resolved by preliminary inquiries.”

(c) Petitioner’s remaining criticisms (Pet. 31-33)

concerning alleged prejudice and trial error were suf-

ficiently considered and properly rejected by the court

of appeals (Pet. App. 7a-11a).’

5. The court of appeals did not err in rejecting (Pet.

App. 4a-5a) the contention (Pet. 33-35) that J udge

Hoffman was obliged to recuse himself because of peti-

tioner’s motion and affidavit requesting that he do so.

To be sufficient, such an affidavit must give ‘‘fair sup-

port to the charge of a bent of mind that may prevent

or impede impartiality of judgment.’’ Berger v. United

States, 255 U.S. 22, 33-34; Rosen «. Sugarman, 357 F.2d

794, 797-798 (C.A. 2). Here, the affidavit (Pet. App.

* For example, ‘‘partisan political implications’’ (Pet. 32) were

supposedly shown by a single question asked by the prosecutor, as

to whether petitioner had voted in the ‘‘Democratie Primary

Election in April of 1964’’ (R. 172). The purpose of the question

was to show that petitioner was not too busy to vote (R. 171).

Petitioner had previously volunteered information which at least

suggested his party affiliation (R. 141), and his counsel made no

objection when the question now under challenge was asked (R.

3 172).

12

45a-49a) contained no allegations of any substance and

was self-defeating, since petitioner also stated that he

‘thas known Judge Julius J. Hoffman for many years

and has a high regard for him’’ and ‘‘believes the high

personal regard to be mutual’’ (Pet. App. 48a).

CONCLUSION

For the reasons stated, the petition for a writ of

certiorari should be denied.

Respectfully submitted,

Erwin N. GRIsworp,

Solicitor General.

Scorr P. CRAMPTON,

Assistant Attorney General.

JOHN P. BurkKE,

JOHN M. Brant,

Attorneys.

SEPTEMBER 1972.

_—

Internal Revenue Code of 1954 (26 U.S.C.) :

SEC. 7201. ATTEMPT TO EVADE OR DE-

FEAT TAX.

APPENDIX

Any person who willfully attempts in any

manner to evade or defeat any tax imposed by this

title or the payment thereof shall, in addition to

other penalties provided by law, be guilty of a

felony and, upon conviction thereof, shall be fined

not more than $10,000, or imprisoned not more than

5 years, or both, together with the costs of prosecu-

tion.

SEC. 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), keep any records, 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 misdemeanor and, upon conviction

thereof, shall be fined not more than $10,000, or

13

14

imprisoned not more than 1 year, or both, together

with the costs of prosecution.

Federal Rules of Criminal Procedure:

Rule 24. TRIAL JURORS

* > am * *

(b) Peremptory Challenges. If the offense

charged is punishable by death, each side is en-

titled to 20 peremptory challenges. If the offense

charged is punishable by imprisonment for more

than one year, the government is entitled to 6

peremptory challenges and the defendant or de-

fendants jointly to 10 peremptory challenges. If

the offense charged is punishable by imprisonment

for not more than one year or by fine or both, each

side is entitled to 3 peremptory challenges. If there

is more than one defendant, the court may allow

the defendants additional peremptory challenges

and permit them to be exercised separately or

jointly.

7 * = * +

¢ U.S. Government Printing Office: 1972—475-692/133