United States v. Marinello
839 F.3d 209
| 2d Cir. | 2016Background
- Defendant Carlo J. Marinello ran Express Courier and from ~1992–2010 kept little or no books, shredded records, paid employees in cash, and did not file personal or corporate tax returns. He used business funds for personal expenses.
- An anonymous tip prompted an IRS review in 2004 that was initially closed; the IRS reopened investigation in 2009 and interviewed Marinello on June 1, 2009. Marinello denied recent filing and admitted to shredding records and using business funds for personal expenses.
- A superseding indictment (2012) charged Marinello with one count under 26 U.S.C. § 7212(a) (the omnibus clause) alleging eight means of corruptly obstructing the administration of the tax laws, and eight counts for willful failure to file (26 U.S.C. § 7203) for 2005–2008. He was convicted on all counts.
- At trial Marinello argued § 7212(a) requires proof of knowledge of a pending IRS action and that the omnibus clause must be premised on an affirmative act (not omissions). The district court refused his requested unanimity/special-verdict instruction and convicted him; it calculated tax loss and denied an acceptance-of-responsibility reduction.
- On appeal, Marinello challenged (1) whether the omnibus clause requires knowledge of a pending IRS action, (2) whether omissions can ground an omnibus-clause conviction and whether a unanimity instruction was required, and (3) procedural sentencing rulings (tax-loss/restitution calculation and denial of acceptance credit).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 7212(a)’s phrase “the due administration of this title” is limited to pending IRS actions of which defendant knew | Gov't: omnibus clause reaches corrupt interference with tax administration generally, not limited to known proceedings | Marinello: conviction requires proof he knew of a pending IRS action (adopt Kassouf) | Court: rejected Kassouf; knowledge of a pending IRS action is not an element — omnibus clause covers corrupt interference with tax administration generally |
| Whether omissions can constitute a § 7212(a) omnibus-clause violation | Gov't: omissions (e.g., destroying records, failing to provide records) can corruptly impede tax administration | Marinello: omnibus clause requires affirmative acts, so convictions based on omission are improper; requested unanimity/special-verdict needed | Court: omissions may constitute violation; no unanimity/special-verdict required here |
| Whether the district court procedurally erred in calculating tax loss/restitution (did court need evidentiary hearing on Marinello’s proffered returns) | Marinello: court should have held hearing and accepted his later-filed returns showing much smaller tax loss | Gov't: Marinello's proffered returns contained inaccuracies; district court reasonably rejected them | Court: no procedural error — defendant had opportunity to rebut; court did not abuse discretion in accepting PSR/government figures |
| Whether Marinello deserved a two-level acceptance-of-responsibility reduction | Marinello: offered to plead to failure-to-file counts and professed remorse | Gov't: defendant denied culpability for omnibus count, was evasive, and obstruction enhancement applied | Court: denial of reduction not an abuse of discretion because Marinello contested factual guilt of omnibus charge and did not timely or clearly accept responsibility |
Key Cases Cited
- United States v. Kassouf, 144 F.3d 952 (6th Cir. 1998) (held omnibus clause requires knowledge of a pending IRS action)
- United States v. Aguilar, 515 U.S. 593 (1995) (nexus requirement for § 1503: corrupt act must be intended to affect judicial proceedings)
- United States v. Kelly, 147 F.3d 172 (2d Cir. 1998) (interpreting “corruptly” under § 7212(a) and affirming omnibus-clause application)
- United States v. Sorensen, 801 F.3d 1217 (10th Cir. 2015) (rejected Kassouf analogy; omnibus clause not limited to pending IRS actions)
- United States v. Massey, 419 F.3d 1008 (9th Cir. 2005) (government need not prove awareness of an ongoing tax investigation for § 7212(a) conviction)
- United States v. Popkin, 943 F.2d 1535 (11th Cir. 1991) (upheld omnibus-clause conviction based on scheme to disguise income, without knowledge of government sting)
- United States v. Bowman, 173 F.3d 595 (6th Cir. 1999) (panel limited Kassouf to its facts and upheld conviction for conduct undertaken absent an ongoing IRS proceeding)
- United States v. McLeod, 251 F.3d 78 (2d Cir. 2001) (affirming conviction for assisting clients to falsify tax returns; § 7212(a) applied without discussion of awareness of pending IRS action)