In the United States Court of Appeals s2

No. 00-3405

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IN THE UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

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UNITED STATES OF AMERICA,

Plaintiff-Appellee

v.

PHILIP E. ROBERTS,

Defendant-Appellant

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ON APPEAL FROM THE JUDGMENT OF THE UNITED STATES

DISTRICT COURT FOR THE WESTERN DISTRICT OF ARKANSAS

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BRIEF FOR THE APPELLEE

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PAULA M. JUNGHANS

Acting Assistant Attorney General

ROBERT E. LINDSAY (202) 514-3011

ALAN HECHTKOPF (202) 514-5396

MEGHAN S. SKELTON (202) 514-5396

Attorneys

Tax Division

Department of Justice

Post Office Box 502

Washington, D.C. 20044

P.K. HOLMES, III

United States Attorney

DAVID N. BLACKORBY

Assistant United States Attorney

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SUMMARY AND WAIVER OF ORAL ARGUMENT

Philip Roberts ("defendant") appeals from a judgment of conviction in a criminal case of the United States District Court for the Western District of Arkansas. Defendant was convicted on two counts of willfully failing to file individual income tax returns, in violation of 26 U.S.C. 7203. He was, inter alia, sentenced to sixteen months' incarceration and ordered to pay restitution in the amount of $58,868.18.

Defendant contends that the Fifth Amendment privilege against self-incrimination justified his failing to file returns, that the indictment was insufficient, that there was no finding of tax loss to support his sentence, that the trial court improperly instructed the jury, and that the jury was biased against him.

Pursuant to Local Rule 28A(f)(1), the United States, appellee herein, respectfully informs the court that it does not believe oral argument would materially assist the Court in deciding this case.

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TABLE OF CONTENTS

Summary and waiver of oral argument i

Table of contents ii

Table of citations iii

Statement of subject matter and appellate jurisdiction 1

Statement of the issues 2

Statement of the case 3

Statement of facts 4

Summary of argument 5

Argument 7

I. The Fifth Amendment privilege against self-incrimination

did not excuse defendant's failure to file tax returns 7

A. Standard of review 7

B. Argument 7

II. The indictment sufficiently set forth the elements of the offense of willful failure to file a tax return 11

A. Standard of review 11

B. Argument 12

III. The District Court did not abuse its discretion in denying

defendant's motion for recusal 15

A. Standard of review 15

B. Argument 15

IV. The District Court correctly determined defendant's tax loss

and base offense level 17

A. Standard of review 17

B. Argument 17

V. The District Court correctly instructed the jury with respect

to the elements of the offense 20

A. Standard of review 20

B. Argument 21

VI. Adding three prospective jurors to the venire panel did not

prejudice defendant 22

A. Standard of review 22

B. Argument 22

Page

Constitution and Statutes (continued):

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VII. The District Court did not abuse its discretion in

conducting voir dire 24

A. Standard of review 24

B. Argument 24

VIII. Defendant has failed to develop the rest of his argument

and has therefore waived them 26

A. Standard of review 26

B. Argument 27

Conclusion 29

Certificate of compliance 30

Certificate of service 31

CITATIONS

IN THE UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

______

No. 00-3405

UNITED STATES OF AMERICA,

Plaintiff-Appellee

v.

PHILIP E. ROBERTS,

Defendant-Appellant

______

ON APPEAL FROM THE JUDGMENT OF THE

UNITED STATES DISTRICT COURT FOR

THE WESTERN DISTRICT OF ARKANSAS

______

BRIEF FOR THE APPELLEE

______

STATEMENT OF SUBJECT MATTER

AND APPELLATE JURISDICTION

This is an appeal from a final amended judgment of conviction and sentence in a criminal case. The District Court had jurisdiction pursuant to 18 U.S.C. 3231. The amended judgment was entered on October 4, 2000, and defendant timely filed a notice of appeal on December 29, 2000. (CR 92, 99.) [/ ]See Fed. R. App. P. 4(b). Jurisdiction in this Court lies under 28 U.S.C. 1291 and 18 U.S.C. 3742(a).

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STATEMENT OF THE ISSUES

1. Whether the Fifth Amendment privilege against self-incrimination allowed defendant to fail to file tax returns.

The United States relies primarily on the following authorities:

United States v. Loniello, 744 F.2d 65, 66 (8th Cir. 1984).

Ueckert v. Commissioner of Internal Revenue, 721 F.2d 248, 250 (8th Cir. 1983).

2. Whether the indictment sufficiently alleged all the elements of the offense of willfully failing to file tax returns.

The United States relies primarily on the following authorities:

Hamling v. United States, 418 U.S. 87 (1974).

United States v. Vroman, 975 F.2d 669 (9th Cir. 1992).

3. Whether the District Judge was biased against defendant and should have recused himself.

The United States relies primarily on the following authorities:

United States v. Darden, 70 F.3d 1507 (8th Cir. 1995).

United States v. Prohst, 792 F.2d 111 (8th Cir. 1986).

4. Whether the District Court properly found tax loss to support a base offense level under the Sentencing Guidelines.

The United States relies primarily on the following authorities:

United States v. Walker, 29 F.3d 908 (4th Cir. 1994).

United States v. Dack, 747 F.2d 1172 (7th Cir. 1984).

United States v. Voorhies, 658 F.2d 710 (9th Cir. 1981).

5. Whether the District Court properly instructed the jury on the elements of the offense.

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The United States relies primarily on the following authorities:

26 U.S.C. 1

26 U.S.C. 6012

6. Whether the District Court erred in adding additional jurors to the venire.

The United States relies primarily on the following authorities:

United States v. Brooks, 174 F.3d 950 (8th Cir. 1999).

United States v. Wood, 299 U.S. 123 (1936).

7. Whether the trial court should have posed specific questions to the jury during voir dire.

The United States relies primarily on the following authorities:

United States v. Brooks, 174 F.3d 950 (8th Cir. 1999).

United States v. Spaar, 748 F.2d 1249 (8th Cir. 1984).

8. Whether defendant has waived several additional arguments.

The United States relies primarily on the following authorities:

United States v. Richards, 118 F.3d 622 (8th Cir. 1997).

United States v. Gonzales, 90 F.3d 1363 (8th Cir. 1996).

STATEMENT OF THE CASE

A grand jury in the Western District of Arkansas indicted defendant Philip E. Roberts on two counts of willfully failing to file tax returns for 1993 (Count I) and 1994 (Count II), in violation of 26 U.S.C. 7203. (CR 1.) After a three-day trial, a jury found defendant guilty as charged. (CR 85, 86.) The District Court sentenced defendant to nine months' incarceration on Count 1 and seven months incarceration on Count 2, to be served consecutively. (CR 91, 99.) The court also sentenced defendant to pay restitution of $58,868.18 to the Internal Revenue Service (id.), and imposed a one year term of supervised release. (CR 99.)

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STATEMENT OF FACTS

Defendant, a resident of Fort Smith, Arkansas, opened Roberts Chiropractic Center in 1987 in Fort Smith. (Tr. 321, 330.) From his chiropractic practice, defendant earned gross income of $123,000 in 1993 and $207,000 in 1994. [/ (Tr. 410-11.) If an individual earned more than $6,050 in 1993 or $6,250 in 1994, he was required to file a tax return. (Tr. 339-40.) ]

When defendant started his business, he employed a tax consultant to prepare his returns. The consultant prepared federal and state tax returns for defendant for 1987, 1988, and 1989, using information provided by defendant, such as sales receipts and invoices. (Tr. 178, 181, 187, 190, 324.) Defendant filed those returns and paid the taxes due for those years. (Tr. 150-51.) He did not, however, file federal income tax returns after 1990 [/ and did not file Arkansas state income tax returns after 1988. (Tr. 150-51, 382.) ]

In the late 1980s, defendant began reviewing the tax laws and seeking the advice of attorneys regarding whether he was required to file tax returns. He received several letters and pamphlets from tax protester attorneys and accountants that stated that he was not an individual liable to make or file a return. (Tr. 628-29.) The information he received, however, also offered the caveat that courts and the IRS do not accept the position that income tax is voluntary and that individuals do not have to file returns. (Tr. 628-29, 676-77.)

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In 1996, defendant changed the name of his business to Orthoneuro Medical Associates and transferred the ownership of the practice, real estate, and equipment to a trust, Pure Trust Organization, purportedly located in the Turks and Caicos Islands. (Tr. 246-47.) Defendant testified that he did not know who the trustee was, but that he was the trust manager. (Tr. 658.) Defendant also transferred ownership of a $175,000 boat to a trust purportedly located on Grand Turk Island. (Tr. 663-65.)

SUMMARY OF ARGUMENT

1. The Fifth Amendment privilege against self-incrimination does not immunize an individual from complying with the duty to file tax returns. Moreover, the privilege applies only in situations in which an individual faces a real, appreciable danger of prosecution, not merely a speculative danger. In this case, defendant suggests a purely speculative danger from filing returns and he was not entitled to refuse to comply with a regulatory scheme based solely on his own determination that he may have risked prosecution.

2. The indictment in this case sufficiently set forth the three elements of the crime of willful failure to file income tax returns. It alleged the facts and law supporting the government's theory of the offense. The indictment was not required to specify any other statute that imposed the duty to file returns; because the indictment identified failure to file a tax return as criminal conduct, it fully notified defendant of the charges against him.

3. The District Court correctly denied defendant's motion for recusal. Defendant has failed to demonstrate any source of extra-judicial bias that would give rise to the appearance or inference of partiality. Instead, defendant lists several adverse rulings as evidence of partiality. Adverse rulings, however, do not support allegations of judicial bias.

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4. The District Court correctly determined defendant's tax loss and base offense level. The court indicated that it had adopted the factual findings in the probation officer's presentence investigative report (PSR), which included a determination of tax loss. In addition, the figures in the PSR matched the testimony of IRS special agents regarding the amount of tax loss. Furthermore, the existence of tax loss did not require a formal assessment procedure by the IRS, since tax loss arises by operation of law.

5. The District Court correctly instructed the jury. The court instructed the jury that individuals who earned income in excess of the filing threshold amounts for 1993 and 1994 were required to file tax returns. This instruction was a correct statement of the law.

6. The addition of three individuals to the list of prospective jurors did not deny defendant a fair and impartial jury. Each member of the jury panel was subjected to the same voir dire, and defendant was afforded an opportunity to observe each member of the jury panel. As long as questioning during voir dire is thorough and identifies potential juror bias, as was the case here, defendant has no basis for reversal.

7. Defendant was not entitled to questions containing the specific wording he requested during voir dire. The District Court had already inquired of the panel on the subject of defendant's requested instructions, and the court's questions were sufficient to identify bias and partiality.

8. An appellant waives all arguments that he does not support with factual and legal authority in the brief. In this case, defendant has mentioned several arguments that he does not substantiate with citations or argument. He has therefore abandoned those arguments, and this Court should not consider them.

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ARGUMENT

I

THE FIFTH AMENDMENT PRIVILEGE AGAINST SELF-INCRIMINATION DID NOT EXCUSE DEFENDANT'S FAILURE TO FILE TAX RETURNS

A. Standard of review

This Court reviews assertions of the Fifth Amendment privilege against self-incrimination de novo. United States v. Harris, 221 F.3d 1048, 1051 (8th Cir. 2000).

B. Argument

Defendant asserts (Br. 17-30) that the requirement to file a tax return under penalty of perjury violates his Fifth Amendment privilege against self-incrimination. Defendant argues (Br. 18-24) that his filing of returns for the prosecution years, 1993 and 1994, would have been evidence of his knowledge of the filing requirements when he previously failed to file returns for 1990 through 1992 and therefore would have been incriminating regardless of the content of the returns for 1993 and 1994. Defendant also contends (Br. 26-29) that if he had filed a return under penalty of perjury, he would have risked prosecution for filing a false return under 26 U.S.C. 7206 and could have provided the government with evidence of his guilt. Defendant's argument is wholly without merit.

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The Fifth Amendment privilege against self-incrimination applies only to situations in which an individual faces a real, appreciable danger of prosecution, not merely a speculative danger. Zicarelli v. New Jersey Commission of Investigation, 406 U.S. 472, 478 (1972). Also, the claimant of the privilege cannot be the sole arbiter of the potential danger of prosecution; the claimant must invoke the privilege. See Ueckert v. Commissioner of Internal Revenue, 721 F.2d 248, 250 (8th Cir. 1983); see also McCoy v. Commissioner of Internal Revenue, 696 F.2d 1234, 1236 (8th Cir. 1983).

The Fifth Amendment does not immunize an individual from complying with the duty to file tax returns. "A taxpayer cannot rely on the privilege against self incrimination to refuse to disclose any information or to fail to file a tax return." Ueckert, 721 F.2d at 250; see also United States v. Sullivan, 274 U.S. 259, 263 (1927); United States v. Silkman, 543 F.2d 1218, 1219-20 (8th Cir. 1976). Moreover, the privilege does not protect an individual from providing financial information on tax returns. United States v. Loniello, 744 F.2d 65, 66 (8th Cir. 1984).

Here, defendant failed to properly invoke the privilege. He did not assert the privilege when the returns for the prosecution years were due and thus attempted to make himself the sole arbiter of the supposed danger from filing returns. Therefore, the privilege does not afford him a defense.