# Amicus Curiae Brief — In re Goulding

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386004_1041%3A1

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2000
- **Citation:** 529 U.S. 1016

## Text

eme Court, US

991369 JAN0 3200
No.

aati OFFICE QE IHE CLERK

IN THE
SUPREME COURT OF THE UNITED STATES

IN RE: RANDALL S. GOULDING

On Petition For Issuance of a Writ of Mandamus

To The Court of Appeals For The Seventh Circuit
Since The Conviction Resulted From:
(4) IRS Agent Evidence Tampering,

(2) Third-party Contacts Made by Justice Cummings,
(3) Seventh Circuit’s Cover-up of Doctored Evidence And IRS
Agent Fraud,
(4) Seventh Circuit’s Opinions Imbued With Patently False
Factual Conclusions, Designed to Preclude Review.

Randall S. Goulding, Pro se
3000 Dundee Rd.

Suite 105

Northbrook, IL 60062
(847) 291-4200

INTRODUCTORY STATEMENT

Petitioner’s defense included good faith and invidious initiation of
an undercover sting operation - that the criminal investigation and
consequent prosecution would not have occurred but for his
speaking out against IRS agents and his civil rights suit. Since the
trial and the conviction, Petitioner:

uncovered IRS agent evidence-tampering concerning the
very undercover audio and video tapes which were the sine
qua non of the conviction (Appendix E).

discovered that the senior panel member in the original
appeal made third party, extra-judicial, off-the-record
contacts (Appendix F).

secured from the government previously withheld,
exculpatory evidence, including evidence:

that Goulding was unaware of the very
reporting requirement for which he was
convicted of not observing,

that the IRS had admittedly engaged in
illegal secret surveillance of Goulding, prior
to any criminal investigation, and

that the mysteriously missing yellow sheet
of paper which the IRS alleges to have lost,
the cornerstone of the government’s case, in
fact, never existed.

uncovered a previously concealed under oath admission to
surreptitious contacts of Goulding’s clients with special
inducements to fire Goulding as their lawyer (June 2, 1994
Order Taking Judicial Notice of Feinglass’s statement) -
while IRS Agent Feinglass rendered a contrary Affidavit in
order to cause the dismissal of Goulding’s Civil Rights Suit

and to facilitate the denial of Goulding’s Motion for
Discovery in this criminal matter. (Appendix G).

QUESTION PRESENTED FOR REVIEW
Whether the Court of Appeals for the Seventh Circuit abused its
discretion when it engaged in the following conduct, and if so,
whether such abuse of discretion warrants this Court’s rarely
exercised mandamus powers:

a. The Seventh Circuit’s opinions conspicuously omit the fact
that the conviction resulted from evidence tampering by IRS
Agents (An Audio Engineer examined the tapes with a newly
discovered audio analysis, concluding that tampering occurred.
Appendix E);

b. Justice Cummings’ made secret third-party, extra-judicial,
contacts (Appendix F);

c. The Seventh Circuit ignored and covered-up doctored
evidence, causing the erosion of important legal doctrines
effectively eradicated by the Seventh Circuit’s implementation
of what may be termed “rug immunity.” - “Rug immunity” is the
judiciary’s cover-up of illegal government activities (including
here, a sinister government plot, admitted to, under oath, by IRS
Agent Feinglass, and courageously disclosed by a government
official - IRS agents and attorneys made special offers to
Goulding’s clients: tax incentives to induce his clients to fire
him as their attorney and to alter their testimony (Appendix G)),
thus immunizing government officials from the burdens of their
illegality, while simultaneously destroying fundamental and
long-standing traditional constitutional protections (including
here, the First, Fifth and Sixth Amendments to the United States
Constitution, and concealment of IRS misconduct and
vindictiveness in violation of Brady v. Maryland, 373 U.S. 83
(1963)), and undermining more liberal and constitutionally
friendly pronouncements of this Court; and

d. The Seventh Circuit’s opinions were so imbued with patently

false factual conclusions and gross factual inaccuracies, that the
only rational explanation is a design to preclude any review by

certiorari, obscuring significant legal issues through such false
factual portrayals?

ill

PARTIES
Randall S. Goulding is the only party seeking relief.

iV

TABLE OF CONTENTS

Introductory Statement
Question Presented for Review
Parties
Table of Contents
Table of Authorities
Prayer for Relief
Statement of Jurisdiction and Opinions Below
Reasons for Granting the Writ
Summary of the Arguments
Statement of the Case

a. Procedural History.

b. History of Proceedings.

c. Excluded Evidence.

Facts - Precipitating The Sting Operation:
the Appearance of Retaliation for Goulding’s

Exercise of First Amendment and Other
Statutory Rights.
d. Evidence at Trial - The Sting Operation.
ARGUMENT

1. Circuit Court Rule 22.2(a)(1)(B) Compliance -

Il.

Goulding Exercised Due Diligence in Discovering the
Frauds on the Court, e.g. the Newly Discovered
Evidence -- Withheld, Concealed and Compromised
by Government Agents.

The Newly Discovered Evidence Is Substantial and
Warrants the Issuance of Mandamus.

A. IRS Employees Tampered with the Tape
Recordings of the Undercover Operation, Destroying
Exculpatory Evidence.

B. Prejudice Resulted from the Tampering.

C. In addition to Evidence Tampering, the
Government Withheld Critical Evidence:

1. The Withheld Criminal Investigation
Referral Report Discloses an Interview of
Goulding, Strongly Suggesting That Goulding

Was Not Aware of the Filing Requirement.
The Government Withheld Evidence That
Goulding Lacked the Requisite Knowledge
for Conviction Pursuant to 31 U.S.C. §§ 5316
and 5322 (Counts 17 and 18)

2. Abuse of the Criminal Process - Even More
Egregious Than the Withholding of Critical
Evidence - the IRS Specifically Designed the
Undercover Operation to Exploit Goulding’s Lack
of Such Knowledge.

3. Additional Withheld Critical Evidence
included IRS Agents’ Vindictive and Illegal
Acts; Making Illegal “Electronic Surveillance
of Goulding’s Conversations,” Even Before
Any Criminal Investigation.

vi

10

13

14

14

14

14

15

Ill.

4. Additional Withheld Critical
Evidence included That the Mysteriously
Missing Yellow Sheet of Paper Which the
Government Alleges to Have Lost, in Fact
Never Existed; it Was Merely a
Prosecutorial Creation.

Previously Known Information and Analysis of the

15

Prejudicial Effect of Withheld, Concealed and Destroyed

Evidence Given the Trial Court’s Prohibition of

Evidence Concerning Bias of Agents Who Testified,

Cumulatively, Clearly Demonstrate the Wrongfulness of

the Conviction.

Goulding’: Conduct for Which He Was
Prosecuted Was Not Clearly Wrongful - His
Activities Were Consistent with That of an

Attorney Properly Preserving the Confidentiality
of His Client.

Justice Cummings’ third-party, extra-judicial,
off-the-record contacts.

A. Rug Immunity

B. Gross Factual Inaccuracies comprise the Seventh
Circuit’s Opinion.

C. The Seventh Circuit’s Attitude Underwent a
Mysteriously Marked Transformation Between the
Time of the Oral Argument and the Opinion.

D. The Opinion is in Disharmony with Ratz/af.

E. The Seventh Circuit’s Opinions Were Arbitrary
and Capricious.

17

26

CONCLUSION 27
Appendices:

Opinion of the United States Court of Appeals for the
Seventh Circuit (Denying Second 28 U.S.C. § 2255
Petition) App. A

Order of the United States Court of Appeals for the Seventh
Circuit Denying Rehearing App. B

Opinion of the United States Court of Appeals for the
Seventh Circuit (Denying Original 28 U.S.C. § 2255
Petition) App. C

Opinion of the United States District Court (Denying
Original 28 U.S.C. § 2255 Petition) App. D

Acoustical Engineer Thomas Danley’s Report on Randall S.
Goulding Tape Acoustical Analysis App. E

Letter from Justice Walter J. Cummings to Sheldon Drobny
Re: United States v. Goulding App. F

Declaration of IRS Office of Chief Counsel Attorney Robert
Ratchford - re January 18, 1985 interview of IRS Agent
Feinglass, filed by the National Association of Criminal

Defense Lawyers, amicus curiae App. G

Vili

———— ee EE Ere.

TABLE OF AUTHORITIES

Cases Page

Adams v. United States ex. rel. McCann, 317 U.S. 269 (1942) 19

Brady v. Maryland, 373 U.S. 83 (1963) ii,2,3,10,13,20,25
Drobny v. Commissioner, 86 TC 1326 (1986) 1]
Elkins v. United States, 364 U.S. 206 (1960) 18
Goulding v. Feinglass, 811 F.2d 1099 (7th Cir. 1987) 11,12
Jacobson v. United States, 503 U.S. 540 (1992) 6,13,16
Mapp v. Ohio, supra, 367 U.S. 643 (1961) 19
Offutt v. United States, 348 U.S. 11 (1954) 19
Olmstead v United States, 277 US 438 (1928) 19
People v. Defore, 242 NY 12 (1926) 18
Ratzlaf v. United States, 510 U.S. 135 (1994) 15,21,23,26,27
United States v. Boyd, et al., No. 89 CR 908, N.D. Ill., E.D.,

Sept. 21, 1993 19
United States v. Burnside, et al., No. 89 CR 909, N.D. Ill, E.D..,

June 4, 1993 19
United States v. Cortina, 630 F.2d 1207 (7 Cir. 1980) 19

United States v. Freymuller, 571 F.Supp. 61 (N.D. Ill. 1983) 19

United States v. DeGerratto, 876 F.2d 576 (7th Cir. 1989) 17

United States v. Goulding, 26 F.3d 656 (7 Cir. 1994)

l

United States v. Granda, 565 F.2d 922 at 924 (Sth Cir. 1978) 15,26

Constitutional Provisions
First Amendment to the United States Constitution
Fifth Amendment to the United States Constitution
Sixth Amendment to the United States Constitution
Statutes & Rules
5 U.S.C. § 552, Freedom of Information Act
18 U.S.C. § 371
18 U.S.C. § +341
28 U.S.C. § 1651
28 U.S.C. § 2241
28 U.S.C. § 2255
31 U.S.C. § 5316
31 U.S.C. § 5322
Circuit Court Rule 22.2(a)

Federal Rule of Criminal Procedure 16(a)(2)

4,13,28
11,3,13,28

11,3,13,17,28

13,16

9
1,4,9,10,20
3,14

14

1,9,27

25

PRAYER FOR RELIEF

Petitioner Randall S. Goulding, pro se, respectfully prays that a writ
of mandamus issue to review the judgments and opinions of the
United States Court of Appeals for the Seventh Circuit.

STATEMENT OF JURISDICTION AND OPINIONS BELOW
Jurisdiction for this matter arises under 28 U.S.C. §1651. The Court
of Appeals order for which mandamus is sought (denying
Petitioner’s Motion for Leave to file a second 28 U.S.C. § 2255
Petition) is unpublished, attached as Appendix A. The Court of
Appeals’ order denying the motion for Rehearing is attached as
Appendix B. The Court of Appeals’ opinion affirming the denial of
Petitioner’s first 28 U.S.C. § 2255 Petition, also unpublished, is
attached as Appendix C. The District Court opinion denying
Petitioner’s first 28 U.S.C. § 2255 Petition, also unpublished, is
attached to this petition as Appendix D. The opinion denying
Petitioner relief on direct appeal is published at 26 F.3d 656.

REASONS FOR GRANTING THE WRIT

Now evident is a clear pattern of abuse - IRS illegality and potential
for vindictive and retaliatory criminal investigation and prosecution,
due to Goulding’s civil rights suit. Also now uncovered - IRS agent
evidence-tampering. But, IRS agents presented false affidavits to
avoid implications of their illegal conduct. Perpetrators of frauds
should not be entitled to benefit therefrom merely because their
frauds were not previously susceptible to discovery. The Seventh
Circuit’s interpretation of Circuit Court Rule 22.2(a)(1) to the
contrary, effectively precluding relief unless the victim fortuitously
discovers the fraud earlier', offends and undermines Fifth

'For example: conspicuously absent from the Seventh Circuit's opinion: IRS agents
and attorneys made special offers to Goulding’s clients: tax incentives to induce his
clients to fire him as their attorney and to alter their testimony. On April 19, 1994,
IRS attorney Ratchford courageously disclosed (after which he was immediately
removed from the case) excerpts of an internal, secret IRS memorandum of an
interview, under oath, of IRS Agent Feinglass (a defendant in Goulding’s Civil
Rights Action), admitting to this practice, originally denied by the IRS in order to
fraudulently secure favorable rulings, including on its motion in imine in this case.
Among other things, Goulding was prevented from demonstrating to the jury, bias of

1

Amendment due process, Sixth Amendment right to confrontation
and Brady v. Maryland.

The Seventh Circuit’s opinions and ex-parte activities collectively, if
left alone, would undermine public confidence in the outcome and in
the appellate process. Such exceptional circumstances warrant the
relief here sought. Relief is not available from any other court or
from any other source. A kinder gentler government would be good,
but honest government is essential to a free society.

Any reluctance to exercise mandamus powers should be tempered
with the recognition that Goulding is innocent! It is a particularly
sad commentary on a judicial system which here refused opportunity
after opportunity to determine guilt or innocence; refusing on each
occasion to expose IRS corruption. It is most unfortunate that the
Seventh Circuit consistently adopts the government’s position and
avoids disclosing IRS wrongdoing in the face of proven and even
admitted, withheld evidence of IRS corruption. So much for the
proposition, long lost in the archives of the Seventh Circuit, that “It
is better that a guilty man go free than to convict an innocent man.”

SUMMARY OF THE ARGUMENTS

The Seventh Circuit abused its discretion, refusing to grant a hearing
upon uncovering of IRS agent evidence-tampering of the very
undercover audio and video tapes resulting in the conviction; these
tapes were the sine qua non of the conviction. -- An Audio Engineer
identified three distinct patterns or indicia of tampering in the very
tapes which IRS agents characterized in their testimony as involving
“accidental” erasures and failure to turn on the tape recorder’. Any
reasonably prudent judicial body would permit an examination of the
original tapes, still in the IRS’s carefully guarded possession.

Additionally, the Seventh Circuit’s senior panel member in the

agents, fellow employees of those who testified at trial. Appendix G.

Conceptually, this is not dissimilar to the DNA testing which resulted in the recent
freeing of so many wrongfully convicted of rape.

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original appeal made third party, extra-judicial, off-the-record
contacts in a matter marred with an abundance of IRS misconduct,
some of which was even admitted. Newly discovered, withheld,
exculpatory evidence, includes evidence:

that Goulding was unaware of the very reporting
requirement for which he was convicted of not observing,

that the IRS admitted to an illegal secret surveillance of
Goulding, prior to any criminal investigation, and

that the mysteriously missing yellow sheet of paper which
the government alleges to have lost, the cornerstone of the
government’s case, never existed.

This withheld evidence, previously denied by IRS agents, should
have been available for cross examination. Its absence prevented
Goulding from cross-examining or developing the bias of the agents
who testified at trial, thus infringing upon his Sixth Amendment
right to confrontation, as well as Fifth Amendment due process and
Brady v. Maryland. The IRS’s failure to turn over this evidence and
its false denial of its existence also facilitated the trial court’s denial
of Goulding’s Motion to Dismiss for Governmental Vindictiveness.
Finally, the overwhelming evidence now clearly establishes an IRS
agent conspiracy, including the illegal coverup using false affidavits
defrauding Congress, the Seventh Circuit and the trial court.

’

STATEMENT OF THE CASE

a. Procedural History. Petitioner Randall Goulding and co-
defendant Michael Ushijima, both Illinois practicing attorneys, were
charged in an eighteen-count indictment: one count of conspiracy to
defraud (18 U.S.C. § 371), two counts of failure to report the
transportation of monetary instruments (31 U.S.C. § 5316) and 15
counts of mail fraud (18 U.S.C. § 1341). They were convicted in a
jury trial before the Hon. James B. Moran, Chief Judge of the
District Court for the Northern District of Illinois. Goulding was
sentenced to six months imprisonment, restitution, community
service, and a five-year term of probation. The Seventh Circuit

affirmed on May 25, 1994 and denied Petitions for rehearing, June
20, 1994. Certiorari was denied. Goulding’s first 28 U.S.C. § 2255
petition was denied December 5, 1994, affirmed on appeal and
certiorari denied. In December 1999, the Seventh Circuit denied
Goulding’s petition to file a second 28 U.S.C. § 2255 petition. The
instant Petition For Issuance of a Writ of Mandamus, seeks relief
from that and/or other Seventh Circuit actions in this case.

b. History of Proceedings. The IRS investigation included a 1986
and 1987 undercover sting operation. Years later, in May 1991,
Goulding was indicted. In June 1992, he was convicted of all
eighteen counts. Michael Ushijima, an attorney specializing in
international transactions, who Goulding hired, was also convicted.

c. Excluded Evidence. Responding to IRS Agent abuses, Goulding,
filed a Civil Rights Suit. Immediately thereafter, the defendant
Agents initiated the criminal investigation which prompted the
undercover sting, the indictment and the conviction. The trial court
granted the government’s motion in /imine, prohibiting any reference
to the Civil Rights Suit. The jury was not aware of agent animosity
and witnesses’ bias against Goulding.

FACTS - PRECIPITATING THE STING OPERATION:
THE APPEARANCE OF RETALIATION FOR
GOULDING’S EXERCISE OF FIRST AMENDMENT AND
OTHER STATUTORY RIGHTS.
The criminal investigation, as well as several additional penal
measures, followed soon after Goulding filed his civil rights suit.
Both of Goulding’s civil rights lawyers were also targeted for a
Grand Jury Investigation after filing the civil rights suit (Doc. 143,
Ex. C’). According to the unrebutted affidavit of Howard
Emirhanian, retired IRS Special Agent, insufficient investigative
reasons existed to commence an undercover sting operation. He
further opined that investigative reasons to continue the undercover

*Such references pertain to the criminal trial document number. “CR” refers to the
transcript page number in the criminal trial.

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sting operation beyond the initial, December 18, 1986 undercover
meeting were insufficient (Doc. 89). No charges were brought as a
result of any activity by Goulding or his associates, other than from
the undercover sting operation (Doc. 143, Ex. C). No evidence exists
that Goulding ever before participated in any effort to aid a client’s
overseas cash transfer, either before or after the undercover sting
operation (Doc. 89 4 8-12). The charges were obscure, mala
prohibitum, not mala in se.

Dietz and Feinglass, the IRS Agents Goulding sued, have a
reputation for vindictiveness (Doc. 143, App. C, Affidavits). While
IRS Agent Feinglass rendered a contrary affidavit in order to cause
the dismissal of Goulding’s Civil Rights Suit and to facilitate the
denial of Goulding’s Motion for Discovery, the IRS concealed
Feinglass’s under oath admission to surreptitious contacts of
Goulding’s clients with special inducements to fire Goulding as their
lawyer (June 2, 1994 Order Taking Judicial Notice of Feinglass’s
statement - Appendix G). The IRS continued to cover-up and refuse
to divulge or disclose the Criminal Investigation Referral Reports,
despite the foregoing indicia of vindictiveness and two (2) court
orders which required production (which were thereafter vacated,
despite finding the requisite “colorable basis” for the defense).

The prosecution, during closing argument, made numerous false
Statements, many going to the very heart of the defense. At least one
was repeated even following defense objection (Doc. 143, Ex. B and
Doc. 161). Twice, the prosecutors falsely told the jury that Goulding
actually admitted that Goulding was “breaking the law.”

The criminal investigation and therefore the sting and the
prosecution would not have occurred but for Goulding’s civil rights
suit. Nor has the government ever denied that the suit prompted the
referral, the criminal investigation and thus, the prosecution.

d. Evidence at Trial - The Sting Operation. The undercover agent
(UCA), introduced to Goulding by a former client (Evegelatos),
expressly sought Goulding’s confidential advice and legal assistance
in investing his past “gambling” money and other past “unreported

5

income.” The UCA indicated a business need for a corporation in
the Cayman Islands (12/18/86, pp.1 1-14; 2/24/87, pp.28,29,50,66;
5/19/87, p.42) and that his monetary accumulations were from prior
years - some from a past crime. None involved ongoing or
contemplated future criminal activity (CR 494-692). Except for the
prosecution’s closing argument, there is very little dispute as to the
facts, nearly all of which is on audio or video tape’.

In the government’s attempt to establish intent and/or predisposition,
James Evegelatos, an admitted life long - “cheat and a con man”
(CR.178), testified that years earlier Goulding prepared a flow chart
on yellow paper, which was among the several boxes of documents
the IRS took from his possession. Agent Hejza testified that he saw
the “missing” yellow sheet of paper, but never photocopied or took
such paper, among the documents he obtained.

The only “hard evidence” of predisposition, this yellow sheet of
paper, was the cornerstone of the government’s case. Yet, it was
never produced at trial; the IRS claims it was lost. This document
also was never before mentioned in any document or testimony, until
trial, just two months after the decision in U.S. v. Jacobson, 503 U.S.
540 (1992), holding that the government must have evidence of
predisposition toward criminality before first subjecting one to a
sting. It was not mentioned in any statement by Evegelatos. It was
not mentioned in Agent Hejza’s memorandum of interview of
Evegelatos. It was not mentioned in Hejza’s grand jury testimony.

It was not mentioned in Hejza’s affidavit in opposition to Goulding’s
Motion to Dismiss. It was not mentioned in any of the numerous
briefs in opposition to Goulding’s Motion to Dismiss, for Discovery
or for reconsideration of the Discovery. It was not mentioned in
response to the unrebutted Emirhanian Affidavit (Doc. 89),
concluding that there were insufficient investigative reasons to
imitate the sting operation or to continue it beyond the first meeting.
It appeared only once its need became evident, shortly after
Jacobson was argued before this Court, clarifying the need for

“It was only recently discovered that this evidence was compromised, per the report
of an audio engineer, using technology invented since the trial.

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evidence of predisposition.

Since this was not Goulding’s area of expertise, he hired Ushijima,
paying him 4 of the $5,000 retainer. Both billed only at their normal
billing rates. Ushijima testified that his responsibilities included
foreign transactions and that Goulding twice told him to make sure
everything was done legally. He testified that before boarding the
airplane on February 7, 1987, he divided up the UCA’s $30,000
among the five individuals with whom he traveled, so that no one
person carried more than $10,000, so as to legally avoid the
declaration requirement (Form 6059-B). Several of the people
traveling with Ushijima corroborated his testimony. There was no
evidence that either defendant knew of the separate reporting
requirement (Form 4790) for which they were prosecuted. Nor did
the government make any attempt to bring it to their attention before
prosecuting. Throughout the undercover operation the UCA referred
only to “the form on the plane,” which is the customs declaration
form, not the Form 4790 for which the penal provisions apply and
for which defendants were prosecuted.

The UCA wanted to make investments with cash, some of which was
excluded from prior tax returns (12/18/86, pp. 12, 14). Goulding
advised -- file an amended return and pay the tax. The UCA
countered with his desire to avoid his ex-wife’s discovery of his cash
horde and to avoid incrimination. Defendants recommended
incorporation to insulate the UCA from personal liability for the
UCA’s intended acquisition of a “bowling alley ... restaurant [and]
liquor license” (2/24/87, pp. 50, 58, 66; 5/19/87, p. 42). At 2/24/87,
pp. 28, 29, Ushijima stated:

a business operation like a bowling alley ... a restaurant have a
lot of liabilities ... you want to isolate that in a company.... You
don’t want that real estate subjected to a guy slipping ina
bowling alley or eating bad food ... advising a client who wanted
to, ah, buy and own and operate a bowling alley/restaurant,
wouldn’t you incorporate the bowling alley and the restaurant
separately? [Y]ou’d have two separate corporations ... there
may be three.... That’s only good business practice.

Only after Evegelatos’ suggestion and following the first two of six
different admonitions that the UCA file amended returns (12/18/86,
p. 13, 15, 26, 35; 02/06/87, p. 11; 03/05/87, p. 12), and after the
UCA expressed investment desires requiring a corporation, did
Goulding advise him to incorporate, but that a domestic
incorporation would incriminate him. Only then did Goulding
suggest that the UCA himself could bring the money to the Cayman
Islands and form his corporation there (12/18/86, pp. 11-15).

On February 7, 1987, the UCA informed Goulding that some of the
funds were illegal gambling proceeds which he had not reported on
his income tax returns. He assured Goulding that no portion was
from drugs and that he was no longer involved in gambling;
Goulding advised the UCA as to the wisdom of abandoning his
purported illegal activities (2/6/87, p. 4).°

Given the likelihood of an incriminating disclosure arising out of a
domestic incorporation and capitalization for the UCA’s
contemplated business acquisitions, coupled with the UCA’s other
articulated secrecy needs (including as to his ex-wife), Ushijima
formed the corporation in Grand Cayman (12/18/88, pp. 11-15;
2/24/87, pp. 28, 29). To account for the UCA’s transfer of funds
from the Cayman corporation to the Minnesota subsidiary, Goulding
prepared promissory notes, requiring repayment.

Goulding also advised the UCA that tax returns should be filed
where required (12/18/86, pp26, 27, 39; 2/24/87, pp 30, 32, 51;
5/19/87, pp 32, 43); and to pay taxes on money brought into the
United States (2/6/87, p 11; 5/19/87, pp37, 38, 40, 42, 43). Goulding
advised the UCA not to stop filing Income Tax returns, despite the
UCA’s contrary suggestion (5/19/87, p34). Goulding advised him
that current income, even if earned abroad, was taxable and should
be included on his tax return (12/18/86, pp 26, 27, 39; 2/6/87, p 11;
5/19/87, pp 32, 37, 38, 40, 42). Goulding advised that tax shelters

*Both defendants queried the UCA as to the possibility of the cash being drug-
related. However, the UCA consistently denied drug activities (12/18/86, pp. 37,
62; 2/6/87, p. 8; 5/8/87, p. 3).

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(Goulding’s area of expertise) would not provide the UCA with any
substantial tax benefit in 1986, being so late in the year (12/18/86,
pp 54-55), refusing to facilitate an erroneous tax benefit.

Ushijima testified that at all times during this transaction, he
believed their actions to be legal. No current funds on which taxes
were due were involved; no contemplated current or ongoing
criminal activities were stated by the UCA. Ushijima was aware of a
specific Supreme Court case which held the prior filing of a false tax
return was not an ongoing crime. Any crime which had occurred in
the past by failing to declare the income was completed at the time
the false return was filed in the prior year. Any further dealing with
undeclared funds on which taxes were not paid was not another
crime (CR. 719). Ushijima was unaware of a “declaration”
requirement if no more than $10,000 in cash was taken from the
United States by any one person. He was not aware of any
“declaration” or “reporting” requirement in connection with his
mailing of bearer bonds outside of the United States. He was not
aware of any “reporting” requirement until he was indicted.

ARGUMENT
For purposes of 28 U.S.C. §2255, Goulding remains in federal
custody, under district court sentence and his freedom is
substantially impaired. 28 U.S.C. §2241(3)(A) requires that before
“a second ... application [is filed], the applicant shall move in the
appropriate court of appeals for an order authorizing the district
court to consider the application.” Goulding petitioned the Seventh
Circuit, seeking an order authorizing the district court to consider the
application. Except as otherwise specified, the information and
evidentiary materials described therein were learned or secured since
the denial of the original petition.

I. Circuit Court Rule 22.2(a)(1)(B) Compliance -
Goulding Exercised Due Diligence in Discovering the Frauds on
the Court, e.g. the Newly Discovered Evidence -- Withheld,
Concealed and Compromised by Government Agents.

Pursuant to Circuit Court Rule 22.2(a)1)(B), Goulding petitioned
the Seventh Circuit to set aside the judgment due to the frauds on the

court or, in the alternative, for authorization to file a second 28
U.S.C. §2255 Petition. The petition’s factual predicate and claims
included newly discovered evidence (Brady v. Maryland materials,
373 U.S. 83 (1963)), learned or secured since the denial of the
original petition, were not then known or reasonably susceptible to
discovery; they were withheld, secreted and compromised by IRS
agents. Such matters were proved by reference to exhibits in the
petition, and by independent analysis of the undercover tapes. Due
diligence was exercised in securing and presenting this newly
discovered evidence. Viewed in light of the evidence as a whole,
such facts suffice to establish by clear and convincing evidence that
no reasonable factfinder would have found Goulding guilty.° Yet,
the Seventh Circuit denied relief, refusing to even investigate the
IRS compromising of the undercover operation tape recordings.

Il. The Newly Discovered Evidence Is Substantial and
Warrants the Issuance of Mandamus.

Fabrications, withholding, secreting and compromising evidence
undermined the verdict, made a farce of the proceedings, denied due
process, warranting relief. Among the more blatant incidents
prompted the National Association of Criminal Defense Lawyers,
amicus curiae,’ to file a motion on May 27, 1994, for the Seventh
Circuit to take judicial notice of a then recent IRS filing of a
previously concealed document in an unrelated case. Therein, an

*While this standard is here satisfied, we seriously question the constitutional
viability of any rule which precludes an innocent person from reversing an
erroneous guilty verdict cultivated by government improprieties, where the evidence
is less than “clear and convincing that no reasonable factfinder would have found
the defendant guilty.” When government impropriety deprives one of a fair trial,
entitlement to a new trial should not be so burdensome. Otherwise, it would be rare
to ever overcome the effects of government illegality. This is particularly true given
certain court’s propensity to avoid embarrassing the government.

’Two amici curiae filed briefs before the Seventh Circuit in the original appeal.

Both concluded that evidence existed supporting Goulding’s contention of IRS
vindictiveness, entitling him to discovery. After initially granting discovery, the

trial court reversed its position. The Court of Appeals upheld the denial of =
discovery, igncring the abundant IRS misconduct. Since that time, much more
evidence, previously concealed by the IRS, has been uncovered.

10

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IRS agent (a defendant in Goulding’s civil rights suit) admitted that
he and other agents surreptitiously contacted Goulding’s clients,
making special offers to induce them to terminate Goulding as their
attorney. Appendix G. The amicus curiae thus brought to the
Appellate Court’s attention the IRS concealment facilitating the
Appellate Court’s erroneous conclusion in the civil rights action:
Goulding v. Feinglass, 811 F.2d 1099, 1104 (7th Cir.1987), cited in
US v. Goulding, 26 F 3d 656, at 662:

“that the agents [sued by Goulding] were merely fulfilling their
duties in investigating potentially abusive tax schemes [and that]
that the evidence of Goulding’s claim of vindictive and outrageous
government conduct was flimsy and meager.”

By contrast, the Feinglass interview (Appendix G, paragraph 8):

Agent Feinglass told . .. Ben Rosenberg, that the IRS would
accept a cash settlement from him, but only if he supplied the IRS
with information and discharged Randall Goulding as his attorney.
This was done per the instructions of IRS legal council [sic],
Lauren Gore and Bill Sabin.*
The IRS concealed this interview (and perhaps others), which
corroborates Goulding’s allegations of misconduct and
vindictiveness on the part of the agents, who apparently instigated
the criminal investigation. This evidence could have been used as a
fertile ground for cross examination of government witnesses.
Evidence of a co-worker’s bias is relevant.

Twelve days following this admission, on January 30, 1985, IRS
District Director J.R. Starkey falsely asserted:

*The Seventh Circuit took judicial notice this document, filed by the IRS in the case
of Drobny v. Commissioner, 86 TC 1326 (1986), wherein Drobny attempted,
unsuccessfully, to reopen such case due to IRS frauds on the court, including by the
same IRS Agent, Irving Feinglass, who Goulding sued and who was instrumental in
referring Goulding for criminal investigation.

11

(a) that Goulding’s “allegations are not supported”; (b) that after a
“thorough” investigation it was “determined that the Revenue
Agents involved were acting in an appropriate manner and that
there was no reason for reassignment of the cases”; (c) there was
“no indication of a lack of professionalism”; (d) that “after
considering the facts presented [the District Director found that]
no conflict or misconduct on the part of the Revenue Agents Dietz
and Feinglass exist[ed].”

Besides being false, this IRS District Director letter, was used in
Goulding v. Feinglass, supra, to falsely demonstrate the IRS’s good
faith. This letter and the concealment of the Feinglass interview
(and perhaps others) were the sine qua non of the grant of summary
judgment in Goulding v. Feinglass, supra, and in granting the
government’s motion in /imine in this case. The combination
perpetrated a fraud on the court in both cases.

Other more recently discovered IRS misconduct includes:

(a) IRS agents tampered with the undercover operation tape
recordings. These tapes were the sine qua non of the conviction.
IRS agents selectively eliminated exculpatory evidence from the
tapes resulting in Goulding’s wrongful conviction. Appendix E.

(b) The IRS improperly withheld at least one interview of
Goulding. The interview evidences his lack of the requisite
knowledge to convict on Counts 17 and 18. Even more egregious
- the IRS then specifically designed the undercover operation to
exploit Goulding’s lack of such knowledge. By design, the
undercover operation became a trap for the unwary innocent.

(c) IRS Agents conducted illegal “electronic surveillance[s] of
Goulding’s conversations,” before any criminal investigation;
further evidencing government vindictiveness.

Tnere is now more evidence that the mysteriously missing yellow
sheet of paper which the IRS alleges to have lost, never existed. In
all the IRS’s documents (since disclosed in partial compliance with

12

the Freedom of Information Act suit, 94 C 5113), the very first
reference to this critical document occurred shortly before trial, long
after all the interviews, document reviews, memoranda, affidavits,
etc. by government personnel. It is now more evident that this
document never existed but was a mere figment of the prosecution’s
imagination; its creation occurred only once needed, only shortly
after the Jacobson case was argued, 503 U.S. 540 (1992), clarifying
the government’s need for such evidence of predisposition.

The issues raised herein, are constitutional -- Sixth Amendment right
to have and to present defense evidence (withheld and secreted by
the government), Fifth Amendment due process and Brady v.
Maryland, 373 U.S. 83 (1963) and First Amendment right to speak
out against illegality without fear of IRS reprisal. Actual prejudice
resulted from the IRS’s concealment and selective compromising
evidence favorable to the defense.

A, IRS Employees Tampered with the Tape Recordings of the
Undercover Operation, Destroying Exculpatory Evidence. Thomas
Danley, Audio Engineer, determined that the tapes used to secure the
conviction, were apparently the subject of tampering. He examined
the video and audio tapes, with a Digital Signal Processing (DSP)
card and Hyperception, a sophisticated sound analysis program.

This technology was developed only within the past few years -
since the trial. The examination uncovered several anomalies in the
very tapes which the IRS agents characterized in their testimony as
involving “accidental” erasures and an “accidental” failure to turn on
the tape recorder. Mr. Danley identified three distinct patterns or
indicia of tampering on those tapes, however, including: background
noise level changes, instances of “dropouts,” and instances of
fundamental output characteristic pattern or feature changes.” Mr.

*According to Mr. Danley’s Report, “every audio recording device and acoustic
environment has its own unique features or ‘fingerpriffts.’” Mr. Danley identified
several instances in which “such features or ‘fingerprints,’ changed during the
course of what purported to be a single taping . . . strongly suggest[ing] the tape was
made with two different setups, under different circumstances (probably at different
locations) and at different times.”

13

Danley’s Report (Appendix E) further provides: “Any one of such
anomalies would suggest the possibility of ‘editing,’ ‘altering’... in
my opinion, with the available information, it does appear that
editing and altering occurred.”

B. Prejudice Resulted from the Tampering. At least once during
the undercover operation, Goulding informed the UCA of his desire
that everything be done legally (consistent with Mr. Ushijima’s
testimony). This exculpatory statement, however, was excluded
from the tapes submitted into evidence.

C. In addition to Evidence Tampering, the Government Withheld
Critical Evidence: 1. The Withheld Criminal Investigation
Referral Report Discloses an Interview of Goulding, Strongly
Suggesting That Goulding Was Not Aware of the Filing
Requirement. Goulding Lacked the Requisite Knowledge for
Conviction under 31 U.S.C. §§ 5316 and 5322 (Counts 17 and 18).
The criminal investigation referral reports an interview of Goulding
candidly “stat[ing] that he [had once deposited] amounts to a ...
Cayman Island Account in currency.” Yet, no form 4970 was filed.
Such a statement to an IRS agent, is compelling evidence that
Goulding was unaware of this form 4970 filing requirement. This
interview, which the IRS concealed until long after the trial, was
incongruous with the prosecution’s trial theory, its briefs, and the
requisite knowledge element for conviction. With this evidence, a
reasonable juror would have concluded that Goulding was unaware
of the requisite filing requirement."°

2. Abuse of the Criminal Process - Even More Egregious

‘It is improper after interviewing Goulding and learning of his lack of knowledge,
to not inform him of this filing requirement (consistent with the law enforcement
objective of assuring compliance). To instead conduct a sting operation to exploit
Goulding’s ignorance of this reporting requirement is an abuse of process. And to so
enlist the aid and assistance of the US Attorney’s office and the federal courts
should be condemned. This evidences agent bias. Such evidence could have
explained why agents lied at trial, and why IRS agents manufactured the
mysteriously missing yellow sheet of paper which the agents allege to have lost, but
which in fact never existed.

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Than the Withholding of Critical Evidence - the IRS Specifically

Designed the Undercover Operation to Exploit Goulding’s Lack

of Such Knowledge.
Not only did the IRS conceal Goulding’s lack of knowledge of this
reporting requirement, but far more egregious - agents specifically
designed the undercover operation to exploit his lack of knowledge.
This misconduct is a particularly egregious form of entrapment. Ata
minimum, the prosecution unjustly precluded Goulding from arguing
to the jury this evidence of his lack of requisite knowledge. The
investigation was not designed to expose existing criminal activity,
but to induce Goulding to engage in conduct which, with the
selective introduction of evidence, was made to appear as a
violation, by illegally preventing the jury from knowing that he was
unaware of this reporting requirement."

kA Additional Withheld Critical Evidence included IRS
Agents’ Vindictive and Illegal Acts; Making Illegal “Electronic
Surveillance of Goulding’s Conversations,” Even Before Any
Criminal Investigation.
Far from being “flimsy and meager” (26 F 3d 656, 662), as the IRS
misled the Seventh Circuit, the withheld criminal investigation
referral report admits to illegal “electronic surveillance of
Goulding’s conversations,” before any criminal investigation."

4. Additional Withheld Critical Evidence included That the
Mysteriously Missing Yellow Sheet of Paper Which the
Government Alleges to Have Lost, in Fact Never Existed; it Was

''The original §2255 petition urged that Goulding had no knowledge of the requisite
Reporting Requirement. In October 1992, O'Hare Airport Commissioner, James
Chronnis, stated that in March 1987 (the time of the transportation), O’Hare Airport,
including in the Eastern Airlines terminals from which Goulding departed, had no
signs advising a traveler what to do if carrying or mailing monetary instruments.
The IRS breached its duty to bring the reporting requirements to Goulding’s
attention before prosecuting. U.S. v. Granda, 565 F.2d 922 at 924 (Sth Cir. 1978),
cited with approval in Ratzlafv. U.S., 510 U.S. 135 (1994).

"Acknowledging the wrongfulness of their conduct in secretly recording Goulding’s
conversations, the previously concealed IRS Report of this matter refers to the
resultant “evidentiary problems” from such activities.

15

Merely a Prosecutorial Creation.
Evidence now abounds that the mysteriously missing yellow paper
which the IRS alleges it lost, never existed. This flow chart, the
cornerstone of the government’s theory of predisposition and intent,
served as the basis for initiating the sting operation. We now know,
however, among all the IRS documents (disclosed in a recent
Freedom of Information Act suit), the very first reference to this
document occurred long after the sting operation, all the interviews,
document reviews, memoranda, notes, affidavits, etc., by IRS
personnel. It was created years later, only once it was needed, after
the Jacobson case was argued before the Supreme Court, clarifying
the need for such evidence of predisposition. It was not previously
mentioned: to the grand jury, in the case agent’s affidavit opposing,
or otherwise in response to the Motion to Dismiss, in justification of
the sting operation, in response to the Howard Emirhanian Affidavit,
contesting any justification for a sting operation, in the case agent’s
notes of his interview of Evegelatos (the informant, who had
allegedly secured from Goulding, this non-existent document), in
any of the memoranda of the interviews of, or in any statement from
Evegelatos (at least until December 16, 1991, in preparation for
trial), years after the document was allegedly secured.

Mysteriously, this alleged flow chart “disappeared” before trial. The
agents claim they “lost” it; Goulding vehemently denies it ever
existed. But why would agents lie? The answer wouid have been
obvious to the jury -- if the defense had been allowed to make the
jury aware of the continuing IRS vindictiveness, much of which
evidence was concealed and some even destroyed by IRS agents, and
the existence of which they falsely denied.

Knowing that the UCA’s comments were being secretly recorded to
be played for the jury, the UCA asked Goulding on seven separate
occasions, about his “problems with the IRS.” Thus, the government
purposely, falsely portrayed him before the jury as someone whom
the IRS had investigated, or charged with prior wrongdoing; unfairly
suggesting to the jury non-existent prior bad acts or other crimes,
where it was really the government itself that should have borne the
adverse taint. The prejudicial effect was enhanced by denying

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Goulding an opportunity for rebuttal or even explanation, granting
the prosecution’s motion in limine. This was central to the IRS’
position that Goulding knew he was acting illegally (mens rea).
“Evidence of other bad acts can be very prejudicial” and was
determined to be “plain error” in U.S. v. DeGerratto, 876 F.2d 576
(7th Cir. 1989), where the court failed to give a limiting instruction.
Moreover, the trial court gave its imprimatur via. Gov. Inst. No. 49,
43, falsely instructing the jury that the investigation was proper.
Given the newly discovered evidence, Gov. Inst. No. 49, was
inaccurate and improper. Even worse, the prosecution fostered this
erroneous instruction by withholding evidence of its inaccuracy and
impropriety. This prevented a fair trial and was a fraud on the court.

It is now clear that the defense was highly prejudiced by this denial
of an opportunity to explain: (1) witness bias; (2) that the IRS and its
agents acted vindictively and illegally toward Goulding, including by
conducting illegal “electronic surveillance of Goulding’s
conversations,” even before any criminal investigation; (3) that IRS
employees tampered with the tape recordings of the undercover
operation, destroying the exculpatory evidence; (4) that the IRS
withheld evidence; (5) the IRS’ mischaracterizations of Goulding;
(6) that his “problems with the IRS” did not exist, and certainly were
not evidence of predisposition. Clearly now, given the newly
discovered, previously concealed and destroyed evidence, Goulding
was denied his Sixth Amendment right to confrontation and his
concomitant due process/fair trial right."”

Il. Previously Known Information and Analysis of the
Prejudicial Effect of Withheld, Concealed and Destroyed
Evidence, Given the Trial Court’s Prohibition of Evidence
Concerning Bias of Agents Who Testified, Cumulatively, Clearly
Demonstrate the Wrongfulness of the Conviction.

To place in perspective the new evidence of IRS misconduct, This
Honorable Court should consider the evidence previously disclosed
in the original §2255 petition and the related Petition for Certiorari.

"In addition, the foregoing evidence of government misconduct, if available to the
defense, would have facilitated pursuit of the entrapment defense.

17

IRS abuses following Goulding’s Civil Rights Action, include: (1)
the vindictive instigation of a criminal investigation, undercover
operation and prosecution against Goulding, and a criminal
investigation against several of his relatives, business associates, and
civil rights attorneys, (2) offers of special inducements to Goulding’s
clients to terminate him, as their attorney (Appendix G), (3) filing
false affidavits and obstruction of Congress by the IRS District
Director, and (4) a series of cover-ups of illegal IRS activities."

Agents thus secured erroneous conclusions from the District Court,
the Seventh Circuit and the jury. As gleaned from recent
congressional hearings on IRS abuse, these are not isolated instances
of over-zealous IRS conduct. Retaliatory practices are commonly
perpetrated against other members of the community who zealously
practice their profession on behalf of clients. Far from “flimsy and
meager” (US v. Goulding, 26 F 3d 656, at 662), there is now “some
evidence” and a “colorable basis” for the claim of vindictiveness, as
found by the trial court. At stake is Goulding’s freedom and no
rational basis has been demonstrated for withholding such evidence.
Discovery previously ordered by the Magistrate should now be
permitted, as well as an analysis of the tapes.

“There are those who say, as did Justice (then Judge) Cardozo, that
under our constitutional exclusionary doctrine ‘[t]he criminal is to
go free because the constable has blundered.’ People v. Defore, 242
NY [12], at 21, 150 NE [585], at 587 [(1926)]. In some cases this
will undoubtedly be the result. But, as was said in Elkins [v. United
States, 364 U.S. 206, 4 L.Ed.2d 1669 (1960)], ‘there is another
consideration--the imperative of judicial integrity.’ 364 US, at 222.
{Emphasis added.] The criminal goes free, if he must, but it is the
law that sets him free. Nothing can destroy a government more

In 1985, IRS District Director J.R. Starkey lied to Congressman Porter, thus
defrauding congress, in his cover up of illegal IRS activities. On April 19, 1994, an
IRS attorney courageously disclosed a portion of an internal secret IRS
memorandum, revealing an excerpt of a January 18, 1985 interview of IRS Agent
Feinglass. See page 11. Similar settlement offers to Goulding's clients were made
directly by IRS District Counsel Loren Gore.

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quickly than its failure to observe its own laws, or worse, its
disregard of the charter of its own existence. As Mr. Justice
Brandeis, dissenting, said in Olmstead v United States, 277 US 438,
485, 72 L Ed 944, 959... (1928): ‘Our Government is the potent, the
omnipresent teacher. For good or for ill, it teaches the whole people
by its example.... IF THE GOVERNMENT BECOMES A
LAWBREAKER; IT BREEDS CONTEMPT FOR LAW; IT INVITES
EVERY MAN TO BECOME A LAW UNTO HIMSELF; IT INVITES
ANARCHY. '” Justice Clark, in Mapp v. Ohio, 367 U.S. 643 at 659, 6
L.Ed.2d at 1092 (1961). (Emphasis added.)

In evaluating the merits of these claims and the importance, I
beseech Your Honors to keep an open mind to the harsh realities of
life, including that government officials, in all their zeal, sometimes
lie and break the law they are sworn to uphold.'* This Court
emphasizes that among the most important functions of the judicial
system is to make plain to litigants and society at large that justice is
done in our courts. Offutt v. United States, 348 U.S. 11, 14, 99 L.Ed.
11 (1954) (“Justice must satisfy the appearance of justice.”),; Adams
v. United States ex rel McCann, 317 U.S. 269, 63 S.Ct. 236, 87
L.Ed. 268 (1942) (“The public conscience must be satisfied that
fairness dominates the administration of justice.”)

IV. Goulding’s Conduct for Which He Was Prosecuted Was Not
Clearly Wrongful - His Activities Were Consistent with That of

'SUnited States v. Cortina, 630 F.2d 1207 (7 Cir. 1980) (affirming a District Court's
ruling resting on outright disbelief of a law enforcement officer), United States v.
Freymuller, 571 F.Supp. 61, 67 (N.D. Ill. 1983) (District Judge disbelieving police
officers, allowing a motion to suppress); the infamous E/ Rukn cases - United States
v. Boyd, et al., No. 89 CR 908, N.D. Ill, E.D., Sept. 21, 1993 and the lack of any
prosecution of Hogan, and United States v. Burnside, et al., No. 89 CR 909, N.D.
ll., E.D., June 4, 1993; the apparent perjury [and demonstration of past illegal
evidence planting by Mark Fuhrman, the reputation of whom may have saved O.J.
Simpson, regardless of guilt or innocence]; the proof (not speculation, but proof) of
the Philadelphia police department, leading to judicial remedies for injured parties.
the Waco hearings; hearings on the Ruby Ridge incident and the Orlando Cruz
incident; the radiation experiments on unwitting US citizens; the sterilizations in the
Lynchburg Colony; the LSD experiments; the Tuskegee Syphilis Experiment, using
human beings as laboratory animals.

19

an Attorney Properly Preserving His Client’s Confidentiality.

In addition to being improperly motivated, the government's theory
of the alleged crime ts frightening. Goulding’s “crime” was
depriving the IRS of confidential information, information relating
to a client - the UCA, information which he had no duty to disclose,
but a duty to safeguard - information about the c/ient’s past criminal
act which the UCA confessed to Goulding. When the UCA
indicated a legitimate business activity in the future, Goulding
advised him (on six separate occasions, on tape) to file amended
returns and to pay the tax. He refused. Goulding then recommended
incorporation and capitalization in a jurisdiction which would
preserve his confidentiality. Goulding consistently advised the UCA
to file returns where required and to comply with the law.

his was, at least arguably, a proper measure of a lawyer, to preserve
client confidentiality and to facilitate the client's ability to operate in
a manner which preserved the confidentiality of his past criminal
act. And so was the belief of the lawyer who Goulding hired as a
precaution. The government’s theory - by designing a client's
affairs ina manner which lessens the likelihood of detection as to his
past criminal act, without any misrepresentations or other criminal
act, Goulding “detrauded” the IRS (out of confidential and even
privileged information), violating 18 USC §§371 and 1341."°

Most importantly, Goulding is innocent! The Seventh Circuit should
have granted the 28 U.S.C. §2255 Petition, or at least a hearing. Yet,
the Seventh Circuit continues to permit the government to withhold
Brady materials, evidence of IRS misconduct and of agents
tampering with evidence, resulting in the wrongful conviction.

V. Justice Cummings’ third-party, extra-judicial, extra-record
contacts, The Senior Panel member in the original appeal, engaged

"*That this could be construed as a crime, given the conflicts Goulding faced,
prompted a National Association of Criminal Defense Lawyers Amicus Curiae briet,
on direct appeal, before the Seventh Circuit and in the United States Supreme Court
Such an undercover operation is too susceptible to ensnaring one who intended to
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in a series of secret ex-parte communications with a non-attorney,
third party, regarding this matter. On or about May 26, 1994, Mr.
Sheldon Drobny attempted to contact the Seventh Circuit's clerk,
having learned of the issuance of the opinion in this case. Mr.
Drobny sought information as to how to bring these inaccuracies to
the court’s attention. Justice Cummings, and not his clerk, answered
the telephone and proceeded to discuss with Droodny this new IRS
disclosure and the consequent inaccuracies of the Seventh Circuit's
opinion, During the conversation, Justice Cummings requested
Drobny’s copy of this document. The same court had taken judicial
notice of this document by virtue of the amicus curiae motion.
Justice Cummings later recontacted Drobny securing additional
information. Appendix F. No record was ever made of these, or of
any other third party contacts. The prospect of extra-judicial
influences prompt concern, given the following disparities:

(a) between the Seventh Circuit’s factual conclusions and the
actual facts as derived from the record on appeal,

(b) between the statements of the justices during the February 17,
1994 oral arguments and the May 25, 1994 opinion, and

(c) between the May 25, 1994 Seventh Circuit’s opinion (on direct

appeal) and the Ratzlaf v. U.S., 510 U.S. 135 (1994) opinion.

A. Rug Immunity
Phe Seventh Circuit's opinions ignore the doctoring of evidence and
other illegal IRS activities - “rug immunity,” a design to cover-up
illegal IRS activities and immunize government officials from the
burdens of their illegality. Important legal doctrines are effectively
eradicated by this illicit practice. Faced with clear, unequivocal
evidence of an IRS conspiracy perpetrating numerous, sinister,
illegal acts, the Seventh Circuit punishes not the perpetrators of
those acts (IRS agents), but the victims. With the advent of such a
corrupt practice, the Seventh Circuit effectively joins the conspiracy.
Indeed, its opinions are so imbued with patently false factual
conclusions and gross factual inaccuracies, that the only rational
explanation is a design to preclude any review by certiorari. (See
Appendix F.)

B. Gross Factual Inaccuracies comprise the Seventh Circuit’s
Opinion.
a. At US v. Goulding, 26 F 3d 656, 664, that the “corporations
[formed by the defendants] had no purpose except to ‘clean’ [the
UCA]’s money.” The evidence blatantly contradicts this assertion
(also made in the government’s brief); the UCA repeatedly
expressed a desire to use his cash accumulation “for investments”,
the purchase of “a bowling alley/bar/restaurant” and “apartments.”

(1) At 12/18/86 page 14 of the transcript: “I wanted to buy into a
bowling alley/bar/restaurant up in Duluth [or] apartment
complexes.”

(2) At 12/18/86 page 12: “I’ve also accumulated some cash over the
last couple years that uh, I want to use for investments.”

(3) At 2/6/87 p.48,49: “In Duluth...1 was looking at some property...
It’s a bar, restaurant, bowling facility].”

(4) At 2/24/87 p. 27, 28: “[I want to buy] a bowling alley. It’s
income-producing. We talked about that,...a restaurant/bar/ bowling
alley.... I'd own it.”

(5) At 5/19/87 p. 42: “We had talked about me getting in to this
restaurant up in Duluth. [Discussion continues with the “liquor
license”™.]”

(6) At 5/19/87 p. 43: “Just have the corporation make investments,
right?” [to which Goulding responded “it has to pay taxes on its
investments.” ]

Both defendants expressly determined that incorporation was
necessary to protect the UCA from personal liability; the UCA
expressed legitimate business needs for corporations.'’ This

'’Ushijima tells Goulding, at 2/24/87 p. 28, 29:
A business operation like a bowling alley and, and/or a restaurant have a
lot of liabilities connected. You want to isolate that in a company...you
don’t want that real estate subjected to a guy slipping in a bowling alley or
eating bad food.... [To] own and operate a bowling alley/restaurant,
wouldn’t you incorporate [them] separately? And lease the real estate...to
the operations?... You have two separate corporations [Goulding agreeing]
maybe three.... That’s only good business practice.

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erroneous conclusion as to the lack of legitimacy of the corporations
and the alleged lack of any business purpose cuts into the heart of
the defense and the legitimacy of defendants’ actions. As argued
before the Seventh Circuit, the IRS sting operation required the
defendants to form corporations and to do so in a manner which
safeguarded incriminating information as to a past crime by their
client, the UCA. The fortuitous consequence of any detriment to the
IRS, in the form of lessening its likelihood of detecting the UCA’s
past crime and perhaps past unreported income, does not transform
otherwise legitimate legal services into mail fraud and a conspiracy
to defraud the IRS out of information. The defendants had no duty to
disclose this information; they had a duty, by virtue of the attorney-
client relationship (created by the IRS), to safeguard such
information from IRS discovery.

b. That there is “overwhelming evidence” of guilt. The evidence
instead demonstrates that both defendants performed otherwise
legitimate legal services in order to prevent incriminating
disclosures as to their client; they properly protected the client’s
confidences, albeit in derogation of the IRS’s ability to detect a past
crime. Observing such confidences does not defraud the IRS. Such
conduct is not “inevitably nefarious.”'"* The overwhelming evidence

At 2/24/87 p. 50, Goulding tells the UCA that the business could be “owned by the
Cayman corporat[ion which] is actually going to then expend the funds, be it either
as a loan to you or a direct acquisition of the property... Goulding suggested a direct
acquisition.” The Defendants even took offense to the UCA’s suggestions that the
corporations were “phony” (2/24/87 p. 49). Ushijima stated at 2/24/87 p. 11:
“creating these...instruments or entities [in Grand Cayman] is...perfectly legal and
above the table.” The bank accounts were obviously needed for such business as
well. The promissory notes properly documented the loans. The notes had a
repayment obligation, discussed at 2/6/87 p. 46, 48, 49; 2/24/87 p. 20, 27. All were
legitimate. Each had a valid business purpose.

''The Seventh Circuit Pattern Jury Instruction given in this case, defines
“wilfulness” as “an act... done voluntarily and intentionally with the purpose of
‘avoiding’ a known legal duty.” This simply fails to comport with Ratzlaf, despite
the Opinion’s contrary assertion at US v. Goulding, 26 F 3d, 662. It simply does not
suffice for the Seventh Circuit to feel that the defendants “knew the[ir] conduct to
be unlawful.” This question is instead delegated by the United States Constitution
to a properly instructed jury.

23

demonstrated good faith. See pages 19-20, above.

c. That the defense “fail[ed] to ... object” to the denial of the
Reliance on Counsel, Instruction No. 20. US v. Goulding, 26 F 3d
656, 664. The objection clearly exhibited disagreement with the trial
court’s ruling (TR p.1003). Refusing the instruction was plain error.

d. That “there is no evidence that Goulding consulted two other
lawyers, Ushijima and Fred Harbecke, before initiating this scheme,
or that he made a full report ... of all the facts” to the persons on
whom he relied. The record is replete with Goulding’s receiving
advice from Ushijima and him following that advice. At TR 2/24/87
(p. 4), Goulding tells the UCA: “J told [Ushijima] the whole
scenario.” At 2/24/87 (p. 6) Goulding tells the UCA “we'll propose
it to [Ushijima],” and 2/24/87 (p. 8): “[Ushijima]’s had a lot more
experience.... | don’t remember that form well enough.” Ushijima
testified that Goulding twice asked that everything be done legally
and that Ushijima said that it would be and that their actions were
legal. Goulding took no action before hiring Ushijima."”

While the Seventh Circuit determined that a jury could have found
that Goulding was not acting in good faith, a properly instructed jury
also could have found that he understood his actions to be legal and
that he was acting in good faith. Good faith negates wilfulness.
Since the jury was not so charged, Goulding was deprived of his
defense. U.S. v. Cheek, 498 U.S. 192 (1993).

e. That Goulding offered no proof of IRS agent misconduct in
support of his Motion to Dismiss and/or for Discovery. Evidence of
retaliation is substantial and evidence of agent misconduct is now
overwhelming. See pages 10-18 above.

f. That there was no evidence of “a lack of predisposition or

"Despite the Seventh Circuit's contrary assertion, reliance on counsel defense is not
restricted to hiring an attorney for one’s own purposes. Nor must the full disclosure
be made by the defendant himself. Suffice it to say that Ushijima had all the facts;
Goulding acted in accordance with his advice.

24

government inducement.” US v. Goulding, 26 F 3d 656, 665. In fact,
the government first suggested “moving money” (October 29, 1986,
p.5). Great reluctance was exhibited to engaging in the IRS induced
conduct, particularly, without Goulding first obtaining independent
counsel to assure himself of the legality; there was no evidence of
any intent to knowingly engage in illegality. The only predisposition
was to perform legal services in a manner which avoided improper
disclosures. Query, why would the IRS design a sting operation with
no clear i!legality and no violation of any duty to the IRS, upon a
subject who had just sued IRS Agents? This is too susceptible to
constituting a device to squelch free speech. The gross disparities
between the record and the unfounded, unsupportable factual

‘ conclusions made a mockery out of the appellate process and, if left
alone, would undermine public confidence in the outcome.”

ye
¥
d
i
§
:
)
3
a

C. The Seventh Circuit’s Attitude Underwent a Mysteriously
Marked Transformation Between the Time of the Oral
Argument and the Opinion.
Distressing are the following disparities between the panel’s
comments during the February 17, 1994 oral argument and its May
25, 1994 opinion:

a. During the oral argument, Justice Rovner accurately stated that
Federal Rule of Criminal Procedure 16(a)(2) does not preclude the
discovery of the Criminal Investigation Referral Reports sought by

| Goulding. Yet, the opinion asserts that Rule “16(a)(2) precluded the
production of the IRS’s Criminal Referral Documents.” 26 F 3d 656,
662. Effectively, the Seventh Circuit has ruled that Rule 16
supersedes Brady v. Maryland, 373 U.S. 83 (1963), after first
properly recognizing otherwise during oral argument.

*°The outcome of most criminal matters and the likelihood of review are fact driven.
We fear that the Seventh Circuit, by misstating the facts, makes matters less
appealable, lessens the likelihood of review and thus lessens the possibility of a
reversal. Apparently, the court repeatedly reached unsupportable factual conclusions
in order to avoid review for incorrect legal conclusions, e.g., criminalizing the
performance of legitimate legal services in a manner which properiy prevents
incriminating disclosures as to a client's past crime.

25

b. Next, while the May 25, 1994 opinion does not once mention the
government's failure to call an expert witness, both Justices Rovner
and Kanne thoroughly questioned the prosecution, stating more than
once that they were “deeply troubled” by its failure to call an expert
witness as to the proper conduct of an attorney faced with the
ambiguous circumstances into which the defendants were thrust.
Justice Kanne commented that this “left the jury out to sea.”

¢. During oral argument, the court questioned the proximity between
the civil rights suit and the subsequent initiation of the criminal
investigation. Yet, the opinion fails to reflect the court’s own
inquiry and discredits the notion, concluding that there was no IRS
misconduct (26 F 3d at 662). The misconduct is now indisputable.

d. The court, during oral argument, also thoroughly discredited the
prosecution's theory as to several mailings and the applicability of
the mail fraud statute, several occasions, expressing utter dismay at
the prosecution's contention that an attorney's invoice, as well as
certain other mailings, could be “in furtherance” of any scheme to
defraud. Yet, again, the opinion fails to comport with the judicial
remarks and questioning during oral arguments.

D. The Opinion is in Disharmony with Ratz/af.
The trial court gave Government Instruction No. 38: “an act is done
wilfully if done voluntarily and intentionally with the purpose of
avoiding a know([n] legal duty.” The Seventh Circuit determined
that this “use of ‘avoiding’ ... comported with Ratz/af (510 U.S. 135
(1994)) and also with the Seventh Circuit’s Pattern Jury Instruction.”
This is in stark contrast with this Honorable Court's specific
wilfulness requirement that the defendant know of the illegality of
his conduct and harbor a specific intent to commit the crime or a
purpose to disobey the law. See also U.S. v. Rogers, 18 F 3d 421
(4th Cir. 1994); and U.S. v. Curran, 20 F.3d 560 (3d Cir. 1994).”'

*'The court effectively suggested that another jury instruction (No. 22) cured any
defect in the instruction. However, that instruction required conviction for what was
clearly not a violation per U.S. v. Granda, $65 F.2d 922 (Sth Cir. 1978), cited in
Ratzlaf with approval.

26

Pan Get I I eS ee

a!

E. The Seventh Circuit’s Opinions Were Arbitrary and
Capricious. The Seventh Circuit clearly failed to give fair and

appropriate consideration of either appeal, or the Circuit Court Rule
22.2(a)(1) petition. We are aware of only one series of third party
contacts by Justice Cummings. Yet, the process was marred by
irregularities, the total divergence between the Justices’ statements
during closing arguments on February 17, 1994 and the May 25,
1994 opinion, the gross disparities between the evidence and many
of the conclusions, a total divergence with the Ratz/af decision and
an utter failure to even inquire into the apparent IRS evidence
tampering. These factors prompt us to seek discovery as to other
possible third-party contacts and irregularities in the Seventh
Circuit's conduct.

CONCLUSION

The issue should not be whether a panel of three feels that the
evidence introduced at trial is overwhelming as to guilt, but whether
the wrongfully withheld evidence may be sufficient to alter the
outcome, particularly when the underlying judgment was the product
of multiple frauds.

The Seventh Circuit has permitted itself to be the proverbial rug
under which the government may freely sweep its dirt. Such refusal
to address this clear evidence of IRS misconduct is what we term
“rug immunity,” whereby the Seventh Circuit protects illicit
government conduct by sweeping it under the rug, not dissimilar to
how the agents have handled the evidence. It stands as perhaps the
most astounding phenomenon in this entire case that despite how
outrageous the IRS conduct and despite the fact that much of the
foregoing has been overwhelmingly demonstrated and in many cases
admitted by agents - there is not one mention of any of these
outrageous abuses in any of the Seventh Circuit’s opinions. Instead
of its conscience being shocked, capriciously, these matters have

been swept under the rug, never to be considered.”

Any law abiding, self-respecting law enforcement official faced with
the prospects of such IRS illegality as here occurred, given the
evidence, would, at the very least, investigate. Indeed, the very fact
that no one has even investigated, instead content to cover-up the
apparent illegality, including doctoring of evidence, is itself yet
further proof of the IRS’s modus operandi in the instant case; not to
investigate real crime (the criminality of which here rests exclusively
in the conduct of IRS agents). Instead of pursuing real crime, the IRS
has endeavored to manufacture the appearance of crime, to retaliate
for Goulding having been so bold as to sue IRS agents for his
exercise of First Amendment rights.

Such an abdication of its responsibilities cheats the public out of
fair, honest and responsible government. The Seventh Circuit’s
refusal to deal with the issues of this case and refusal to correctly
portray the facts of this case not only threatens the integrity of its
actions but threatens to undermine the entire judicial process and to
emasculate the federal criminal system.

The criminal investigation (the sting) and the prosecution would not
have occurred but for defendant’s civil rights suit; nor does the
government contended otherwise. The Seventh Circuit adopted a
shallow and unreasoned limitation to the Fifth Amendment’s
prohibition against government vindictiveness, limiting the
constitutional protection (if any remains in this Circuit), to
prosecutorial vindictiveness. Yet, the purpose of such a rule is
avoid governmental undermining of the constitutional protection. If
a prosecution would not have occurred but for such retaliation, at
whatever level the retaliation occurred, citizens will feel constrained
to avoid such constitutional exercise. The constitutional right thus
loses its efficacy. With the new evidence, particularly coupled with

“2Worse yet, the jury was deprived of this information, secreted by the IRS, not
furnished to the defense. Additionally, the outrageous government conduct became
the subject matter of a motion /imine, precluding any defense reference to
government illegality in any defense argument or questioning.

28

Det EY, Male nicer espe BOS SALA NOE OEE

the other indicia of good faith, including the numerous admonitions
by Goulding that the undercover agent comply with the law,
Goulding would not have been convicted. He was denied a fair trial.

For the reasons stated herein, it is respectively requested that this
Court issue a writ of mandamus for the lower courts to determine
that the trial was a nullity, and vacate the sentence and judgment and
dismiss the indictment or order a new trial, and/or require that the
district court conduct an evidentiary hearing on defendant’s
substantial allegations of constitutional deprivation, and/or issue an
order or a mandamus requiring the government to turn over:
complete copies of all criminal investigation referral reports
pertaining to Goulding, all memoranda of interviews of IRS Agents
Dietz and Feinglass and any other documents generated by either
IRS Agents Dietz and Feinglass pertaining to Goulding, the originals
of the tapes of the undercover operations for independent
examination and all documents and materials pertaining to
“electronic surveillance of Goulding’s conversations.”

Kt aN C Respectfully submitted,

NDALL S. GOULDING, pro se
3000 Dundee Rd. Suite 105, Northbrook, IL 60062
(847) 291-4200

29

APPENDICES

Appendix A Page 1 of 25

UNITED STATES COURT OF APPEALS
FOR THE SEVENTH CIRCUIT
Chicago, Illinois 60604
Submitted September 16, 1998
Decided October 13, 1998

Before

Hon. FRANK H.

EASTERBROOK, Circuit Judge
Hon. ILANA DIAMOND

ROVNER, Circuit Judge
Hon. DIANE P. WOOD, Circuit

Judge

, RANDALL S. GOULDING, On Motion for an

2 | Order

4 Authorizing the
District Court to
Entertain a
Successive
Petition for
Collateral Review

Petitioner,

No.98.9104 v.
UNITED STATES OF AMERICA,
Respondent.
ORDER

Randall S. Goulding has filed an application for leave to file a
successive 28 U.S.C. § 2255 motion. He claims that he has evidence,

Appendix A Page 2 of 25

discovered after the denial of his first § 2255 motion, that is
sufficient to establish by clear and convincing evidence that no
reasonable factfinder would have found him guilty. Goulding’s
“newly discovered evidence” is simply another attempt to support
his general claims that the government’s prosecution of him was
vindictive and in retaliation for a prior conflict with the Internal
Revenue Service and that the government withheld exculpatory
evidence from him. Goulding made similar claims on both direct
appeal and in his first § 2255 motion. Goulding’s present claims are
merely the repetition of old rejected claims that he attempts to
support with new-evidence. See Bennett v. United States, 119 F.3d
470, 471 - 72 (7th Cir. 1997); 28 USC § 2244(b)(1). Even if we
were to consider the claims that Goulding seeks to raise as new
claims, the “newly discovered evidence” Goulding seeks to present
does not establish by clear and convincing evidence that no
reasonable factfinder would have found him guilty. Instead, as this
court noted on direct appeal, the evidence against Goulding was
“overwhelming.” United States v. Goulding, 26 F.3d 656, 663 (7th
Cir. 1994).

Accordingly, Goulding’s application for leave to file a successive §
2255 motion is DENIED.

Appendix B Page 3 of 25

UNITED STATES COURT OF APPEALS
FOR THE SEVENTH CIRCUIT
Chicago, Illinois 60604
Submitted November 30, 1998

Decided December 11, 1998

By the Court:
RANDALL S. GOULDING, On Motion for
Reconsideration
Petitioner,

No.98.9104 Vv.

UNITED STATES OF AMERICA,
Respondent.

ORDER

Randall S. Goulding has filed a petition for rehearing. Goulding
seeks reconsideration of the court’s decision denying his motion for
leave to file a second or successive motion pursuant to 28 U.S.C. §
2255. 28 U.S.C. § 2244(b)(3), however, provides that “the grant or
denial of an authorization by the court of appeals to file second or
successive application shall not be appealable and shall not be the
subject of a petition for rehearing or for a writ of certiorari.”
Accordingly, this court is not authorized to consider Goulding’s
petition for rehearing, which shall be filed in without further action
by the court.

Appendix C Page 4 of 25

UNITED STATES COURT OF APPEALS
FOR THE SEVENTH CIRCUIT
Chicago, Illinois 60604
(Argued March 29, 1996)

Decided August 2, 1996

Before

Hon. FRANK H. EASTERBROOK, Circuit Judge
Hon. ILANA DIAMOND ROVNER, Circuit Judge

Hon. DIANE P. WOOD, Circuit Judge

RANDALL S. GOULDING, ] Appeal from the United
States
] District Court for the
Petitioner-Appellant, ] Northern District of
Illinois,
] Eastern Division,
No. 95-1368 _v. ] No. 93 C 2637

J
UNITED STATES OF AMERICA, } James B. Moran, Judge

J
Respondent-Appellee. ]

ORDER

Randall Goulding was charged in 1991 in an 18-count indictment
with conspiracy to defraud the United States, mail fraud, and illegal

Appendix C Page 5 of 25

transportation of currency and monetary instruments, in violation of
18 U.S.C. §§ 371 and 1341, and 31 U.S.C. §§ 5316(a) and 5322(a).
After a jury found him guilty, on all counts. Goulding was
sentenced on October 15, 1992 to six months’ incarceration on
Count | and five years’ probation on Counts 2 through 18. He was
also sentenced to make restitution of $8,000 to the United States and
to perform 500 hours of community service.

This court decided Goulding’s direct appeal on March 25, 1994.
See United States v. Goulding, 26 F.3d 656 (7th Cir. 1994), It held,
in pertinent part, that (1) Goulding failed to demonstrate that the
government had acted selectively or vindictively in prosecuting him,
(2) the district court correctly held that Federal Rule of Criminal
Procedure 16(a)(2) precluded the production of the IRS’s criminal
referral documents, and thus that the court did not err in denying
Goulding’s discovery request for the production of those documents,
and (3) Goulding waived his objection to the failure of the district
court to give a particular instruction to the jury both because he
failed to object below and because the instruction in question was
not supported by the evidence.

On September 14, 1994, Goulding filed a motion to vacate his
sentence pursuant to 28 U.S.C. § 2255. His petition asserted five
basic grounds for relief: ineffective assistance of counsel,
deprivation of his constitutional right to testify, improper denial of
access to criminal investigation reports, lack of evidence for Counts
17 and 18 that he had the requisite knowledge to support a
conviction, and the invalidity of the conviction because the
prosecution was vindictive. Without holding an evidential hearing,
the district court denied the petition in an order dated December 5,

Appendix C Page 6 of 25

1995. It held that there was no basis for a conclusion that the
prosecution was vindictive, that the government did not
impermissibly limit discovery by refusing to provide Goulding with
a copy of the criminal referral, and that Goulding was not denied
effective assistance of counsel (either because of a failure to object
to a jury instruction or because of a failure to recommend that
Goulding testify). On appeal to this court, Goulding raises a host of
issues, some of which relate to the merits of his § 2255 petition and
others of which relate to the district court’s refusal to hold an
evidentiary hearing. Some of these issues, as we note below, were
resolved against Goulding in his direct appeal to this court, and may
therefore not be re-litigated in the guise of a motion under § 2255
absent a showing of good cause for and prejudice from his failure to
appeal. Melvin v. United States, 78 F.3d 327,329 (7th Cir. 1996);
Patel v. United States, 19 F.3d 1231, 1237 (7th Cir. 1994). In broad
terms, Goulding claims that he has new evidence of vindictive
prosecution, which shows that his constitutional right to due process
has been violated both by outrageous government misconduct and
violations of Brady v. Maryland, 373 U.S. 83 (1963). Second, he
reiterates his claim that he was denied effective assistance of counsel
in a variety of respects, principally by counsel’s improper “refusal”
to allow him to testify and by counsel’s decisions on jury
instructions. Finally, he claims that he should have been granted an
evidentiary hearing, because disputed issues of fact existed on his
allegations. We consider these points in turn.

This court considered Goulding’s claim of “invidious, retaliatory
prosecution” in the direct appeal from his conviction and rejected it.
It is true that the Fifth Amendment prohibits the government from
prosecuting a defendant because of some specific animus or ill will

Appendix C Page 7 of 25

on the prosecutor’s part or to punish the defendant for exercising a
legally protected statutory, or constitutional right. See United States
v. Goodwin, 457 U.S. 368, 372 (1992). Nevertheless, in Goulding,
we held that Goulding failed to demonstrate that the government
acted selectively or vindictively in its actions. In order to prevail on
a claim of selective prosecution, he would have had to show that the
Internal Revenue Service’s criminal investigation of him had both a
discriminatory purpose and a discriminatory effect. 26 F.3d at 662.
In order to show, vindictive prosecution, he would have had to show
that he was prosecuted to punish him for exercising a protected right.
Id. This court carefully considered and rejected both claims, writing:

even if Goulding could convince this Court that Agents Dietz and
Feinglass harbored ill will towards Goulding, Goulding failed to
demonstrate that these agents had any influence on the bringing of
this prosecution. In fact, it is clear the agents were not involved in
the decisions to begin a criminal prosecution or to prosecute--
Goulding, however, makes no claim that the prosecutors who
actually made the decision to bring charges against him acted
vindictively. Furthermore, Goulding made no showing of
discriminatory effect (he failed to show, for example, that other
similarly situated persons were not prosecuted). Id.

The alleged “new evidence” of vindictiveness that Goulding has
brought forward in his § 2255 petition suffers from the same flaw: it
does not demonstrate any link between the alleged ill will and
vindictiveness of the [RS agents in charge of the criminal tax
investigation against Goulding and the prosecutors who initiated and
litigated the fraud, currency, and monetary instrument claims here.
We reject Goulding’s suggestion that we should adopt a theory of

8 Te, -

Appendix C Page 8 of 25

“imputed vindictiveness,” pursuant to which the U.S. attorneys
should be held responsible for the state of mind of the IRS agents.
This is not a case where an investigator working for the U.S.
Attorney’s office knows of crucial exculpatory information and fails
to turn it over, where courts have held that the prosecutor must be
held responsible for the acts of its agent. See Kyles v. Whitley, 115
S.Ct. 1555, 1567-1568 (1995); United States v. Morris, 80 F.3d
1151, 1169 (7th Cir. 1996). There is nothing to indicate that the IRS
was acting as an agent of the prosecutors in an unrelated case. and
thus we cannot impute its motivations to the prosecuting authority.
As for his allegation of outrageous Government conduct, it is enough
to note that this court rejected that theory as an independent ground
of recovery in United States v. Boyd, 55 F.3d 239 (7th Cir. 1995). In
any event, the “new evidence” is at best cumulative to that already
considered by this court. We decline to give Goulding a second bite
at the apple on this claim.

Goulding’s claim that he was denied effective assistance of
counsel by his lawyer’s alleged “refusal” to allow him to testify is
similarly unpersuasive. Goulding, himself a lawyer, attempts to
portray himself as a susceptible individual whose will was somehow
overborne by his attorney. He states in his brief that he was not
“permitted to testify,” and that his attorney made a unilateral
decision not to permit [him] to take the stand.” Putting the rhetoric
to one side, however, the trial record before Judge Moran speaks for
itself:

Judge Moran: Mr. Goulding, you understand that you have a
right to testify, or not testify.

Goulding: Absolutely. Your Honor.

Appendix C Page 9 of 25

Judge Moran: And you can get all sorts of advice from your
counsel as to whether you should or you
shouldn’t.

Goulding: And I certainly have.

Judge Moran: But the final decision is up to you.

~

Goulding: I understand.

Judge Moran: And it is your choice not to testify.
Goulding: I understand.

Judge Moran: And that is your choice.

Goulding: That is my choice, correct.

Judge Moran: Okay.

Goulding offers no evidence to show that he was somehow incapable
of responding honestly and knowledgeably to the judge’s questions.
The general rule is that parties are held to their responses, both in these
kinds of exchanges and in Rule || coiloquies. even if then, later have
second thoughts. See United States v Messino, 55 F.3d 1241, 1248 (7th
Cir. 1995); United States v. Malave, 22 F.3d 145, 148 (7th Cir. 1994);
United States v. Cirrincione, 780 F.2d 620, 624 (7th Cir. 1996) (“A
truly knowing and intelligent waiver accepted by the court will insulate
a conviction from later attack.”)

Goulding’s other assertions of ineffective assistance of counsel are
equally, unavailing. in order to prevail on this kind of claim, he must
present evidence that his counsel’s conduct fell below an objective
standard of reasonableness and that his case was prejudiced by his
counsel’s conduct. Strickland vy. Washington, 466 U.S. 668 (1984).
Here, in addition to the claim about counsel’s advice on his right to
testify, Goulding asserts that his counsel did not perform a thorough
enough investigation, that he failed to submit proper “theory of the

Appendix C Page 10 of 25

defense” jury instructions (in the face of this court’s earlier holding that
the evidence in the record did not support the instruction Goulding is
still claiming should have been given, see 26 F.3d at 668), and that
counsel failed to pay attention at a critical point in the trial, when
certain incriminating tapes were being played. Even if we assumed for
the sake of argument that the lawyer’s decisions were unreasonable
(and we see nothing to support such an assumption), Goulding’s
argument fails on the “prejudice” part of the test. As the panel on
direct review has already observed, the evidence against Goulding “was
overwhelming.” Id. at 663-64. He therefore has not raised a credible
ineffective assistance of counsel claim.

In light of the nature of Goulding’s claims in the § 2255 petition, the
district court did not abuse its discretion in deciding not to hold an
evidentiary hearing. A hearing is not required if “the motion and the
files and records of the case conclusively show that the prisoner is not
entitled to relief.” 28 U.S.C. § 2255, 93. We agree with Judge Moran
that this standard was met.

We therefore AFFIRM the judgment of the district court.

Appendix D Page 11 of 25

Minute Order Form (rev. 12/90)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
UNITED STATES OF AMERICA, )
)
)
v. ) No. 93 C 2637
) No. 91 CR 370-1
RANDALL S. GOULDING, )
) Judge Moran
Defendant. )

Memorandum and Order
DOCKET ENTRY:

Enter Memorandum and Order. Defendant, by a Section 2255 petition,
seeks to raise constitutional issues attacking the validity of his convic-
tion. While the reasons advanced are many, they are mostly prior
arguments in new packages. The petition is denied.

“e/ mr
JAMES B. MORAN,
Chief Judge, U.S. District Court

DEC 8 1994

Appendix D Page 12 of 25

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
UNITED STATES OF AMERICA, )
)
)
V. ) No. 93 C 2637
) No. 91 CR 370-1
RANDALL S. GOULDING, )
) Judge Moran
Defendant. )
MEMORANDUM AND ORDER

Defendant, by a §2255 petition, seeks to raise constitutional issues
attacking the validity of his conviction. while the reasons advanced are
many, they are mostly prior arguments in new packages. The petition
is denied.

The petition alleges that defendant was denied effective assistance of
counsel, denied his constitutional right to testify, was improperly
denied access to criminal investigation reports, was convicted of counts
17 and 18 despite an absence of evidence that he had the requisite
knowledge for conviction, and that additional evidence shows that the
prosecution was vindictive. We consider that petition from the
perspective of having been the trial judge, of having reviewed the
arguments and exhibits of the petitioner and the government, including
petitioner’s 45-page handwritten reply brief, and being mindful that the
Court of Appeals considered and decided numerous issues on appeal.
We are also well aware that, as petitioner concedes, in this case
“[y]irtually everything is on tape.”

We deal with the last issue first. Petitioner contended both in the
trial court and the Court of Appeals that the prosecution was vindictive
because the conduct of two IRS agents back in the mid-1980s was
vindictive and the government would not give him a copy of the

Appendix D Page 13 of 25

criminal referral. Neither this court nor the Court of Appeals found the
argument persuasive and, besides, the Court of Appeals specifically
ruled that the production was precluded by Fed.R.Cr.P. 16(a) (2).
United States v. Goulding, 26 F.3d 656, 662 (7th Cir. 1993). Petitioner
now adds in a hearsay opinion of a former IRS agent, whom he
solicited to be (and who could have been, if he had had anything
relevant to say) a retained expert, who opined that referral reports are
not normally withheld and might be Brady material. He also adds some
additional material indicating that one of the IRS agents may have
acted improperly in the mid-1980S. Petitioner does not, however,
establish any connection between that agent and this prosecution, as
pointed out by the Court of Appeals; the government had no obligation
to furnish the report unless it was Brady material; and we do not
assume that government attorneys disregarded their obligations to
furnish Brady material solely because of their resistance to production
of the report.

Petitioner also contends that he was denied effective assistance of
counsel. Establishing that is a daunting task -- the counsel was of his
choosing; that counsel is recognized as one of the most competent
criminal defense lawyers in the community; the standard of proof
petitioner must meet is high; this court observed that representation
throughout the trial; and, given the tapes, petitioner did not give his
counsel much to work with. Nevertheless, we will consider petitioner’s
principal contentions. He argues that his counsel should have objected
to this court’s failure to give tendered instruction No. 20, while failing
to note that the Court of Appeals has ruled that the instruction was not
supported by the evidence in the record. Id. at 668. That court has also
ruled that the instructions pertaining to reporting requirements were
“entirely adequate.” Id. at 666. The government’s closing argument
was permissible. Id. at 667-668. Most of the remaining arguments are
little more than nitpicking -counsel did not talk with petitioner as often
as petitioner would have liked, he on occasion rejected petitioner’s
views as to trial tactics, he sometimes did not pursue some line of
inquiry as vigorously as petitioner would have preferred.

The last significant bone of contention concerns the petitioner’s
failure to testify. Petitioner, an attorney (which undoubtedly explains

Appendix D Page 14 of 25

the extent of his now second-guessing his counsel) , was expressly
advised that he had a right to testify or not testify and that the decision
was his, and he expressly represented that he did not wish to testify.
He now claims that he should be relieved of that waiver because,
although he wished to take the stand, he could not because his counsel
was unprepared for his testimony. Although his counsel ascribes other
reasons, we accept for the purposes of this petition the representation
that counsel said he did not have time to prepare adequately to examine
petitioner. What he also said, according to petitioner’s affidavits, is
that petitioner provided too much detail; that “if you ask him what time
it is, he will tell you how to build a clock”; that he would not be a good
witness; and that counsel could get in what he needed to get in through
the co-defendant and argument.

This court has spent a considerable time on this case: pretrial, trial
and post-trial We have observed the petitioner in various
circumstances, listened to him, and read whatever he has presented.
This court has no question but that preparation of petitioner to testify
would have required an incredible effort, and he still would have been
a poor witness. As this petition demonstrates, he has his own
perception of what is important and his own selective perception of the
facts. We need look no further than the argument here that his
representation was constitutionally ineffective because his counsel did
not push positions that the Court of Appeals had previously ruled are
unsupported by the evidence in the record. Four judges (which
includes this court) have concluded that proof of guilt was
overwhelming. Petitioner has yet to concede he did anything wrong.
One with that capacity for rationalizing would be a loose cannon on the
witness stand, and an inviting target. We have no reason to disagree
with counsels conclusion, much less to term it ineffective assistance.
Counsel did the best he could, but he could not surmount the difficulty
that petitioner had, on the tapes, convicted himself.

“*o/ gh
JAMES B. MORAN,
Chief Judge, U.S. District Court

Appendix D Page 15 of 25
Dec. 5, 1994.

Appendix E Page 16 of 25
Report on Randall S. Goulding Tape Acoustical Analysis
I am an Acoustical Engineer. See the attached resume, exhibit 1.

On or about August 18, 1997, I met with Mr. Randall S. Goulding.
Mr. Goulding then explained to me that in 1986 and 1987, he was the
subject of a federal undercover sting operation. He further explained
to me that he had second generation video and audio tapes furnished to
him courtesy of the federal government and that he suspected that the
government had altered the tapes. Mr. Goulding furnished me with
those video and audio tapes for my examination, identified in the
attached exhibit 2.

In accordance with Mr. Goulding’s request, I have listened to all such
audio tapes, several times, with head phones (to aid in hearing acuity).
Additionally, I monitored the tapes using my computer, running a
Digital Signal Processing (DSP) card and Hyperception, a sophisticated
sound analysis program. This technology was invented and made
available to technicians only within the past three years. See the
attached exhibit 3 describing DSP and Hyperception.

In the course of my examination of the tapes, approximately 65
hours, I found a number of anomalies in two of the tapes: the one
labeled “4-16-87 attempts to contact Goulding” and the one labeled
“11/11/86 phone conversation with Goulding.” I found it interesting
that these were the very tapes which Mr. Goulding identified as
involving “accidental” erasures and “accidental” failure to turn on the
tape recorder. All other tapes appeared normal.

First, I found places in those tapes where the background noise le» |
changed. Second, I found in those same tapes instances of “dropor ».”
“Dropouts,” are instances on the tape where a certain audio process
inherent in that tape abruptly stops.

Finally, I identified instances of fundamental output characteristic
pattern or feature changes. Every audio recording device and acoustic
environment has its own unique features or “fingerprints.”
Significantly, in certain instances such features or “fingerprints,”

Appendix E Page 17 of 25

changed during the course of what purported to be a single taping. For
example, on the 11/11/86 tape (Spectrogram marked #1), one should
recognize a distinctly different sound spectra between the introduction
and the actual phone call and a rather abrupt start. The Spectrogram
marked #1 illustrates this well and strongly suggests the tape was made
with two different setups, under different circumstances (and
presumably at different locations) and at different times.

Approximately the first one-third of this Spectrogram is characterized
by significantly different features than the balance. Not surprisingly,
the different features start mid-sentence as Mr. Goulding’s
conversation begins with the undercover agent. This markedly
different pattern reveals a different setup. First, the average lateral
length of the lines in the first one-third of this Spectrogram is less than
one-half of those in the rest of the Spectrogram. More significantly,
moving horizontally across the bottom of the Spectrogram, another
rather abrupt change is evident; all four bands of bright patches
disappear at the same spot. Less dramatic, the overall degree of
brightness dissipates after the first one-third of this Spectrogram.

The Spectrogram marked #2 (tape from 1 1/11/86) similarly suggests
that the tape was made with two different setups under differing
circumstances, separated by the significantly darker area. It would
appear that many of the features noted with regard to the first one-third
of Spectrogram #1, reappear toward the end of Spectrogram #2
(following the significantly darker area), while the setup for the final
two-thirds of Spectrogram #1, appears to be similar to that for the
beginning of Spectrogram #2. Additionally, at the end of this
conversation, depicted in Spectrogram #2, is an additional voice, cutoff
in midstream, saying “memo to....” This also appears to have a
different spectra (see Spectrogram #2, I inserted the white line for
illustrative purposes), suggesting a different setup.”

On Spectrogram # 3, reflecting the April 16, 1987 tape, about 2 inch
starting from the left, one can see the normal sonic “tag” left by this

Appendix E Page 18 of 25

recording machine when it starts and stops. It appears as two spikes
with a dark gap in between. Now, locate the vertical white line |
inserted as a marker. The marker is actually about 1/8 inch before the
actual starting and stopping (due to my reflex time), where the
recording cuts into the conversation mid-sentence. One can notice that
there is no sonic “tag” here from starting and stopping. This
distinction, the presence of a sonic “tag” on the one occasion of starting
and stopping, but absent in the next, on what purports to be one
continuous tapin« on the same day with the same equipment, under the
same circumstances, in the same environment, is also consistent with
editing.

In other words, after the start and prior to the end of the taping
process in what purports to be a single taping event, and in the same
tapes, | have identified such anomalies as noise level changes,
“dropouts,” speed changes and fundamental output characteristic
pattern or feature changes. The foregoing incidents identified, are
typically indicative of a different taping setup, such as a different
recording device substituted at such moment, a different recording
environment, or both. Any one of such anomalies would suggest the
possibility of “editing,” “altering”or otherwise compromising the
original tape or a prior generation of such tape, from which such tape
was created. Without these original tapes, I cannot say with 100%
certainty, but in my opinion, with the available information, it does
appear that editing and altering occurred.

Finally, I think it is at least “curious” that these agents perform these
tasks routinely (in the one tape even calling inter-office each time to
confirm that the gear works) and then “forgets” to turn on the machine
the only time it is important to do so, when talking to the subject, Mr.
Goulding. Then, the very tape which the agent claims to have
“forgotten” to turn on the machine when commencing his undercover
task, is also the tape bearing these anomalies.

It remains at least a theoretical possibility, although unlikely, that
these anomalies could have occurred innocently, in the original
recording or in the process of copying to cassette. While each of these
sound change anomalies are suggestive of “editing,” as indicated

Appendix E Page 19 of 25

above, I cannot say definitively that at any particular point, it is the
result of what would appear to be the result of tampering/editing. On
the other hand, if the government is willing to supply me with the
original reel to reel tapes, even under their supervision and without
their losing control over the original tapes, I could, through the same
analysis, determine, with more certainty, whether these sound change
anomalies were the consequence of tampering.

This certainty is because there is an inaudible “bias” signal on the
original tape which we can extract with the computer. This process
would identify the source and confirm if those spots are edits (or for
example, the innocent consequence of the process of where the tape
recorder started and stopped). The “bias tone” is a high frequency
signal that is inaudible. It is recorded along with the “normal” audio
signal process while the audio signal is recorded on the tape. It aids in
the magnetization process. The signal is inaudible; it is above the range
of normal hearing (ultrasonic). When a tape is reproduced, this Bias
signal is not transferred as the playback head in the tape recorder
cannot normally pick up or record this signal.

With the original of a tape, by playing the tape at a reduced speed,
the bias becomes audible. The “normal” audio signal (in this case, the
voices) can be filtered out using a high pass filter, leaving only the bias
tone available for analysis. At this point, the bias tone, as it is normally
a continuous tone, can be used to find starts and stops as well as
pauses, as would occur in editing, recording over, etc. A discontinuous
bias signal should stand out quite distinctly, using the Hyperception
program.

If the government is willing to supply only some of the original tapes,
the ones in which I would have most interest would be the one labeled
“4-16-87 attempts to contact Goulding” and “11/11/86 phone
conversation with Goulding.” Unlike DNA testing, the entire process
is non-destructive; it would be performed without compromising the
original evidence.

Sincerely,

Appendix E Page 20 of 25

“e/ ~
Thomas Danley

~ HS Aeon ANA Meuron ea ol

Appendix F Page 21 of 25

UNITED STATES COURT OF APPEALS
SEVENTH CIRCUIT

CHAMBERS OF

WALTER J. CUMMINGS

CIRCUIT JUDGE

219 SOUTH DEARBORN STREET

CHICAGO, ILLINOIS 60604 May 31, 1994

Mr. Sheldon Drobny
Adler Drobny Fischer, Ltd.
95 Revere Drive - Suite A

Northbrook, Illinois 60062-1585
Re: United States v. Goulding

Dear Mr. Drobny:

Thank you for your helpful letter of May 27, together with its
attachments. You may be sure that this material will be considered by
the panel.

Sincerely,

“¢/ 9
Walter J. Cummings

i i Honorable S. Kanne
Honorable Ilana Diamond Rovner

Appendix G Page 22 of 25

UNITED STATES TAX COURT

SHELDON DROBNY AND
ANITA DROBNY ,

Petitioners,

)
)
)
)
)
v. ) Docket No.6985-83
)
COMMISSIONER OF INTERNAL REVENUE,)

)

)

Respondent.

DECLARATION OF ROBERT M. RATCHFORD

I, Robert M. Ratchford, hereby swear and affirm, under penalties of
perjury that:

1. | am an Attorney admitted to practice before the United
States Tax Court.

2. | am employed by the Office of Chief Counsel for the
Internal Revenue Service. I am presently a Special Trial
Attorney assigned to Regional Counsel, in Chicago, Illinois.

3. On March 8, 1994, the above-named case was assigned to
me for defense of the Commissioner of Internal Revenue with respect
to petitioners’ Rule 12 Motion for Leave to File Motion to Vacate
Decision (hereinafter "Motion for Leave").

4. Between March 11, 1994 and March 21, 1994, I interviewed
and discussed petitioners’ pleadings and respondent's response with
Revenue Agent Irving Feinglass, William C. Sabin, Lauren W. Gore,
and Harmon B. Dow. At that time of these discussions, our closed tiles
with respect to the previous trial in this matter had been requested but
not received. In my discussions with Mr. Feinglass, I learned that he

Appendix G Page 23 of 25

had previously been sued by Mr. Randall Goulding in U.S. District
Court. Upon learning that information, I requested that General Legal
Services retrieve their closed files with respect to that collateral matter
for my use in this case.

5. Subsequent to my discussions with William C. Sabin,
Harmon B. Dow, and Lauren W. Gore, I drafted and faxed or delivered
to them the Affidavits and Declaration which were subsequently
executed and filed as attachments to respondent's Notice of Objection
which was sent to the Court for filing on March 22, 1994.

6. At the time that I filed respondent’s Notice of Objection and
Motion to Strike in this case (March 22, 1994), none of the requested
files had been retrieved.

7. Some time around the middle of April 1994, I received a box
of closed files with respect to the collateral litigation involving Randall
Goulding and Irving Feinglass. This collateral litigation is reported at
Goulding v. Feinglass, et al, 811 F.2d 1099 (7th Cir. 1987, cert. denied,
482 U.S. 929 (1987).

8. On May 12,1994, I began to review the closed collateral files
involving the Goulding v. Feinglass litigation. On May 13, 1994, late
in the afternoon, I discovered a Report of Investigation by Regional
Inspector--Midwest Region. This Report of Investigation contained an
interview with Revenue Agent Feinglass by Inspectors Peter McCauley
and John Corcoran on January 18, 1985 in Chicago, Illinois. The
Memorandum of Interview, in relevant part, contains the following
statement:

"Inspector CORCORAN then asked
Revenue Agent FEINGLASS if he
ever approached a client of Mr.
GOULDING'S just before trial and
stated "If I were you, I would not
have GOULDING representing me".
He replied that he did not say that,
but did relate a situation involving a

Appendix G Page 24 of 25

tax shelter based on investments
research and development of products
that contained extracts from the Aloe
Vera plant. Prior to the trial, Revenue
Agent FEINGLASS told one of the
investors | BEN ROSENBERG, that
the I.R.S. would accept a cash
settlement from him but only if he
supplied the I.R.S. with information
and discharged RANDALL
GOULDING as his attorney. This
was done per the instructions of
I.R.S. Legal council, LOREN GORE
and BILL SABIN. Revenue Agent
FEINGLASS believed this occurred
sometime in September or October
1984. The offer was declined."

9. On May 13, 1994, my immediate supervisor, James C.
Lanning and the Regional Counsel John T. Lyons, were not in the
office.

10. First thing Monday morning on May 16, 1994, I brought
the above to the immediate attention of my supervisor James C.
Lanning.

1]. On May 17, 1994, pursuant to directions received from
Regional. Counsel John T. Lyons, this matter was referred to the
Regional Office of Inspection.

12. On May 17, 1994, Midwest Regional Office of Inspection
began their investigation with respect to the allegations made in the
1985 interview by Revenue Agent Feinglass and the statements made
in the Affidavits and Declaration submitted with respondent's Notice
of Objection in this case.

13. The investigation by the Regional Office of Inspection also
includes the Department of Treasury, Inspector General. This

Appendix G Page 25 of 25

investigation is still open.
Further declarant sayeth not.

*s/ 99
Date Robert M. Ratchford

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386004_1041%3A1. Public record. Not legal advice.