United States v. Charles Irby, Jr. , 703 F.3d 280 ( 2012 )

Case: 11-60800 Document: 00512087360 Page: 1 Date Filed: 12/18/2012
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
December 18, 2012
No. 11-60800 Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff - Appellee
v.
CHARLES W. IRBY, JR.,
Defendant - Appellant
Appeal from the United States District Court
for the Southern District of Mississippi
Before JOLLY, JONES, and GRAVES, Circuit Judges.
PER CURIAM:
After a four-day trial, a jury convicted Charles W. Irby, Jr. of one count of
attempting to evade or defeat a tax in violation of 26 U.S.C. § 7201 (Count I);
four counts of willful failure to file a tax return in violation of 26 U.S.C. § 7203(Counts II through V); and one count of attempting to interfere with the
administration of internal revenue laws in violation of 26 U.S.C. § 7212(a)
(Count VI). The district court ordered a 60-month prison term for Count I;
concurrent 12-month terms for Counts II through V; and a 36-month term for
Count VI. The terms were ordered to run consecutively for a total of 108
months. The court also ordered a three-year term of supervised release for
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No. 11-60800
Count I and one-year terms of supervised release for Counts II through VI, with
all terms to run concurrently. Irby timely appealed.
Although we GRANT Irby’s motion to reconsider the clerk’s denial of his
motion to extend the time for filing a reply brief and allow the brief to be
submitted to us, we nevertheless conclude that the district court did not err in
any respect. Irby’s appeal, however, raises an issue of first impression: whether
the six-year statute of limitations for section 7201 offenses begins to run from
the date the tax return was due or following the last affirmative act of tax
evasion.1 See 26 U.S.C. § 6531(2). Because we hold that there are no merits to
any of Irby’s substantive points, and because we hold that the statute of
limitations accrues from the last evasive act, we AFFIRM the judgment of the
district court.
I.
The Due Process Clause establishes a floor requiring a “fair trial in a fair
tribunal, before a judge with no actual bias against the defendant or interest in
the outcome of his particular case.” Bracy v. Gramley, 520 U.S. 899, 904-05
(1997) (quoting Withrow v. Larkin, 421 U.S. 35, 46 (1975)) (citations and internal
quotation marks omitted). “[J]udicial remarks during the course of a trial that
are critical or disapproving of, or even hostile to, counsel, the parties, or their
cases, ordinarily do not support a bias or partiality challenge.” Liteky v. United
States, 510 U.S. 540, 555 (1994) (noting that we look for “a deep-seated
favoritism or antagonism that would make fair judgment impossible”).
1
All other issues raised by Irby on appeal are completely meritless: the government
did not engage in vindictive prosecution; the indictment was not constructively amended; there
was sufficient evidence demonstrating his scienter and willfulness; there was no constitutional
violation of his right to a trial by jury; and there are no grounds for disclosing the “chambers
papers” of this court. Irby’s allegations of bias and incompetence on the part of the district
judge also are meritless, but we will briefly address his argument that the district judge’s
statements to the jury during voir dire amounted to a due process violation.
2
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Irby’s allegation is premised on the district judge’s statement about civic
duties to prospective jurors during voir dire, including that citizens should pay
their taxes.2 Notwithstanding that this was a legally correct statement, we
measure the potential for bias against the totality of the circumstances at the
trial. United States v. Saenz, 134 F.3d 697, 702 (5th Cir. 1998) (“The totality of
the circumstances must show that the trial judge’s intervention was
‘quantitatively and qualitatively substantial.’” (quoting United States v. Bermea,
30 F.3d 1539, 1569 (5th Cir. 1994))). Here, we have a single, isolated statement
made during voir dire. Taken in the context of a four-day trial in which the
court instructed the jurors during voir dire and in its jury charge that the
Government had the burden of proof and was required to show that Irby owed
taxes and had failed to file tax returns, and that Irby was presumed innocent,
this single statement is insufficient to form the basis of a claim of judicial
misconduct during a trial. See United States v. Lance, 853 F.2d 1177, 1182-83
(5th Cir. 1988); see also United States v. Franklin, 586 F.2d 560, 570 (5th Cir.
1978). As such, we hold that Irby was not denied his right to a fair trial based
on the single voir dire statement.
II.
The district court’s conclusion that Count I was not barred by the six-year
statute of limitations is a legal conclusion that we review de novo. See United
States v. Gunera, 479 F.3d 373, 376 (5th Cir. 2007); United States v. Wilson, 322
F.3d 353, 359 (5th Cir. 2003).3
2
The allegedly prejudicial statement was: “It’s a civic duty, and the older circuit judge
I used to practice under many, many years ago used to tell jurors, [y]ou’ve got two things: You
should vote, you should pay your taxes, and then [you should] serve on a jury. Three things
that you should do to comply with your citizenship.”
3
The district court’s factual findings are not clearly erroneous, and there is sufficient
evidence to find, as the jury did, that Irby acted to evade the payment of taxes as late as 2006
through the use of nominee trusts designed to conceal his assets. See United States v.
McDowell, 498 F.3d 308, 312 (5th Cir. 2007); United States v. Avants, 367 F.3d 433, 441 (5th
3
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Although we addressed the application of the statute of limitations to a
section 7201 violation in United States v. Williams, we expressly declined to take
a position on the last affirmative act of evasion as it was not implicated by that
case. 928 F.2d 145, 149 (5th Cir. 1991) (“We express no opinion relative to the
effect of affirmative acts occurring subsequent to the [tax return] filing date.”).
Williams held only that “the limitations period for a prosecution under section
7201 in which no tax return was filed begins to accrue on the day the [tax]
return is due.” Id. Because Irby last failed to file his taxes in 2001, Count I is
time barred unless the statute of limitations period begins to accrue following
his last affirmative act of tax evasion.
Section 6531(2) states:
No person shall be prosecuted, tried, or punished for any of the
various offenses arising under the internal revenue laws unless the
indictment is found or the information instituted within 3 years
next after the commission of the offense, except that the period of
limitation shall be 6 years-- . . .
(2) for the offense of willfully attempting in any manner to evade or
defeat any tax or the payment thereof; . . . .
26 U.S.C. § 6531(2). Count I thus is not time barred as long as Irby was indicted
within six years of when the crime of “willfully attempting in any manner to
evade or defeat any tax or the payment thereof” was completed. See 26 U.S.C.
§ 7201; see also United States v. Dandy, 998 F.2d 1344, 1355-56 (6th Cir. 1993)
(discussing the application of the Supreme Court decision in United States v.
Habig, 390 U.S. 222, 225 (1968)).
The other circuits that have expressly considered the issue have concluded
that the statute of limitations for section 7201 offenses runs from the later date
Cir. 2004). Irby’s indictment was returned in 2011, five years after his use of the nominee
trusts. Thus, if the statute of limitations begins running from the last affirmative act of
evasion, Irby’s conviction under Count I is supported by sufficient evidence.
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of either: when the tax return was due or the defendant’s last affirmative act of
tax evasion. See, e.g., United States v. Anderson, 319 F.3d 1218, 1219-20 (10th
Cir. 2003) (“Section 7201 criminalizes not just the failure to file a return or the
filing of a false return, but the willful attempt to evade taxes in any manner.”);
United States v. Carlson, 235 F.3d 466, 470 (9th Cir. 2000); United States v.
Wilson, 118 F.3d 228, 236 (4th Cir. 1997); United States v. Dandy, 998 F.2d
1344, 1355-56 (6th Cir. 1993) (“To hold that the statute of limitations for income
tax evasion . . . began to run on the date the returns were filed would reward
defendant for successfully evading discovery of his tax fraud for a period of six
years subsequent to the date the returns were filed.”); United States v. Winfield,
960 F.2d 970, 973-74 (11th Cir. 1992) (per curiam); United States v. DiPetto, 936
F.2d 96, 98 (2d Cir. 1991); United States v. Ferris, 807 F.2d 269, 271 (1st Cir.
1986); United States v. Trownsell, 367 F.2d 815 (7th Cir. 1966) (per curiam). In
Dandy, the Sixth Circuit addressed facts similar to those at issue here, where
the defendant did not file tax returns for 1982 and 1983, but the last act of
evasion did not occur until 1985. Dandy, 998 F.2d at 1355-56. The Dandy court
found that the statute of limitation runs from the last evasive act “because it is
these evasive acts . . . which form the basis of the crimes alleged in . . . [the]
indictment.” Id. at 1356. In Ferris, the First Circuit supported the rule by
pointedly stating, “[t]he defendant, however, by deceitful statements continued
his tax evasion through [date of last act of evasion].” Ferris, 807 F.2d at 271(noting that Habig supports this result because, “[t]he [Supreme Court] held
that it made no sense to assert that ‘Congress intended the limitations period to
begin to run before appellees committed the acts upon which the crimes were
based’” (quoting Habig, 390 U.S. at 224-25)). No circuit has rejected the last
affirmative act of tax evasion rule.
The rule, therefore, is well-supported in Supreme Court precedent and in
the caselaw of other circuits. One element of the section 7201 offense is the
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commission of an affirmative act seeking to evade tax liability, which can be
shown through the individual’s willful failure to file a tax return, Williams, 928
F.2d at 149, or through continued evasive acts intending to avoid the payment
of taxes. The statute of limitations accrues from the later of the two.
Irby last acted to evade the payment of his taxes in 2006, by using
nominee trusts to conceal his assets. Because he was indicted in 2011, the
district court did not err in concluding that Count I was not barred by the
statute of limitations.
III.
For the foregoing reasons, the judgment of the district court is
AFFIRMED.
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