United States v. Patrick Sutherland
921 F.3d 421
4th Cir.2019Background
- Patrick Sutherland owned/controlled multiple companies and routed international transactions through Stewart Technology Services (STS), a Bermuda company; he treated millions in transfers as loans/capital contributions and did not report them as income for 2008–2010.
- In April 2012 a federal grand jury subpoena sought financial records; in July 2012 Sutherland (through counsel) sent the U.S. Attorney’s Office purported loan agreements purporting to explain the transfers.
- The government introduced evidence that the loan documents were fabricated or backdated and conflicted with STS accounting; related documents and signatures were implausible.
- A federal grand jury indicted Sutherland for filing false tax returns (26 U.S.C. § 7206(1)) for 2008–2010 and for obstruction of an official proceeding (18 U.S.C. § 1512(c)(2)) for corruptly attempting to influence the grand jury.
- A jury convicted on all counts; the district court sentenced Sutherland to 33 months’ imprisonment. He appealed principally challenging the § 1512(c)(2) conviction and some evidentiary rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the government proved the required nexus between Sutherland’s conduct and an "official proceeding" under § 1512(c)(2) | Gov: The grand jury was convened; sending fabricated loan documents to prosecutors shortly after subpoena was reasonably foreseeable to affect the grand jury | Sutherland: He only sought to influence the U.S. Attorney’s Office (an investigation), not a particular grand jury; no sufficient temporal/causal/logical nexus per Aguilar/Marinello | Affirmed: Jury properly instructed on nexus; evidence showed documents were sent after subpoena and were reasonably likely to be transmitted to and affect the grand jury, satisfying Aguilar/Marinello nexus requirement |
| Whether the jury instructions adequately conveyed the Aguilar/Marinello nexus requirement | Gov: District court’s instruction tracked Aguilar—requiring knowledge that the grand jury was pending and that actions would naturally and probably interfere | Sutherland: Instruction insufficient as his acts were aimed at the prosecutor/investigation, not the grand jury | Affirmed: Instructions correctly stated nexus and corrupt intent standards; allowed jury to decide factual foreseeability |
| Whether the prosecutor’s closing argument misstated evidence by implying all $2.1M were taxable income | Gov: Argument supported by evidence showing transfers and fabricated documents | Sutherland: Closing improperly overstated that all transfers should have been treated as income, denying a fair trial | Affirmed: No plain error; closing arguments may be vigorous and jury was instructed closings are not evidence; no substantial-rights prejudice shown |
| Whether district court improperly admitted prior acts/evidence under Rule 404(b) | Gov: Evidence was intrinsic to charged offenses (same transaction series; necessary to complete story) | Sutherland: Evidence was character/other-act evidence and thus inadmissible | Affirmed: Evidence (2007 return, statements to partner, lawsuit context) was intrinsic or necessary for context; admission not an abuse of discretion |
Key Cases Cited
- United States v. Aguilar, 515 U.S. 593 (recognizing nexus requirement: relationship in time, causation, or logic between act and obstructed proceeding)
- Marinello v. United States, 138 S. Ct. 1101 (applying Aguilar principles to tax-obstruction context; requiring a particular proceeding be foreseeable)
- Young v. United States, 916 F.3d 368 (4th Cir. 2019) (discussing anticipatory-foreseeability and that mere investigation is not an "official proceeding")
- Reich v. United States, 479 F.3d 179 (2d Cir. 2007) (discretionary acts of third parties can form part of nexus when transmission to proceeding is foreseeable)
- Arthur Andersen LLP v. United States, 544 U.S. 696 (articulating foreseeability requirement for obstruction-related statutes)