*1 SNEED, Before FARRIS and PREGERSON, Judges. Circuit *2 763 SNEED, following year, Judge: cover them. The MCAsent Circuit $50,000 pay- Pisello a Form for the appeals Pisello his con- James Salvatore accountant, in response, ment. Pisello’s counts of tax evasion in viction of two asserting pay- sent MCA letter that the (1982). of 26 U.S.C. He violation § ment awas loan. argues by erred con- that the district court indictment, amending im- structively his Sugar Hill Transactions B. proof, allocating the properly burden 1984, Sugar approxi- In Hill evidence, paid Pisello convicting him insufficient with $156,109 mately his ef- refusing connection with production to order of hand- persuade forts to government’s MCA distribute notes made written Sugar Sugar purchase Hill’s records and to agents during interviews witnesses. recordings. “catalog” Hill’s of master We affirm. Again, Sugar several factors make Hill’s payments to Pisello resemble loans. For I. example, Sugar president, Hill’s Milton BELOW AND PROCEEDINGS FACTS owners, Malden, Joseph and one of its Rob- phonograph inson, payments in the record Pisello worked have testified that precise thought industry they from 1983 to 1985. His that Pi- were loans and During time, however, Hill, Sugar repay role unclear. this sello them. would fact, payments that are rele- as he entered into transactions treated the loans on its Records, treating MCA Inc. it vant to this case with books and told Pisello that was (Sugar (MCA), Hill Ltd. them Records,, as loans. On the other hand several (Betaco). Hill), Enterprises payments A and Betaco factors make the look like ad- description against money of each follows. Pisello brief vances pur-
would receive as a commission if MCA Transactions A.MCA catalog. Sugar Hill’s Malden has chased admitted that no loan documents were $30,000 gave In MCA June made, expected repay that he feasibility establishing investigate commission, Sugar Hill that the out of record label.” Several factors a “Latin parties originally payments ad- called payment like a make look loan. this vances, repay did not and that Pisello agreed would parties allegedly that Pisello money. accept did money return the if MCA not him, pay- proposal MCA carried Transactions Betaco C. receivable, as an account ment on books Bedi, repay money, Ranji Finally, Pisello failed to from 1983 to when company the sum off as a bad a number wrote Betaco made owner hand, MCA and Pisello with his debt. On the other to Pisello connection in any MCA up did document transaction to set several deals with efforts agents a Form 1099 way MCA issued Pisello Federal found an undated records. payment to the Internal to Bedi and reporting for check in Bedi’s files issued (IRS) nonemployee Pisello. Bedi has purportedly Revenue drawn Service Perhaps this to ad- the check compensation. was testified that he had no idea how that, purposes of files and way the income tax reduction made its into his vance him, he given had MCA. would negotiated it. paid January In MCA Pisello an $50,000. MCA later asked Pisel-
additional Subsequent Events D. $60,000 to show its lo for three checks did not This case because Pisello attempting to collect arises auditors that was money he received in report all of This consistent with money from him. transactions, and trans- treating creating foregoing other payments as actions, on his income tax re- gave MCA the income receivable. Pisello account he to file funds turns for 1983and failed he had insufficient checks but grand return for In a tax II.
jury indicted Pisello three counts of JURISDICTION attempting to evade defeat income tax (1982). 26 U.S.C. Count I under § jurisdiction district court had reported he alleged (1982). that Pisello 18 U.S.C. This court has § jurisdiction (1982). had lost income in fact he under 28 U.S.C. *3 $73,660.00. approximately made had II alleged reported that Pisello had Count III. $95,306.00 1984, he had in made STANDARDS REVIEW $281,- OF
in
he had made approximately
fact
alleged
Count III
that Pisello had
166.00.
Pisello,
above,
as noted
raises four issues
$115,600.38
approximately
in 1985.
made
appeal.
on
We
allegation
review the
began,
Before
trial
constructively
amended his indict
gave
twenty
formal memo-
about
Lipk
novo. See United
v.
ment de
States
summarizing
agents’
randa
interviews
is,
1447,
(9th Cir.1985).
770 F.2d
1452
As
of
in the case and one
of
issue,
witnesses
set
legal
a
we review the allocation of
notes from one of
inter-
proof
handwritten
these
the burden of
de novo. United
v.
McConney,
States
1195,
unsuccessfully
Pisello later
728 F.2d
views.
moved
1201
(9th Cir.) (en banc),
denied,
cert.
469 U.S.
of the
production
handwritten notes
824,
101,
(1984).
105 S.Ct.
IV. which $30,000 payment received AMENDMENT CONSTRUCTIVE proof alleged of a crime not constituted II COUNT support position, To the indictment. argues that court must re- cases: Sti significant cites three States, under count II because rone v. United conviction verse his 361 U.S. beyond went the confines (1960) (amend district court S.Ct. L.Ed.2d 252 reaching its verdict. indictment jury ment occurred when was allowed to $30,000 Analyzing payment that Pisello theory how defendant had consider 1984, the district from MCA in received interfered with interstate commerce that indictment); court stated: alleged in the was not Solis, paid to Mr. Pisello States v. $30,000 308-09 in funds [T]he (amendment Cir.1988) jury mu- occurred when Latin proposal for his establish the defendant of by Mr. Pi- was allowed to convict monies earned sic label were *4 indictment, possession either or of heroin distribution in The sello 1984. allege posses contemplated indictment did not this income to when the charged, had Cusmano, States v. sion); United and 659 The Court finds in 1985.... be earned (amendment 714, (6th Cir.1981) proof F.2d of this income this inclusion that jury was allowed to find in a fatal occurred 1984 is not of tax evasion physical in extortion threats of violence allegation the indict- from the variance only alleged threats of when the indictment ment. loss). economic grand disagrees, charging that the Pisello failing pay tax on for
jury ways. indicted him in responds The two Betaco, Hill the Sugar but First, income from argues that consideration of the failing him for court convicted $30,000 charging of did not alter the terms Hill, Betaco, Sugar from pay tax on income simply the count II of indictment because and MCA. alleged pay Pisello failed to substantial approximate an sum of amount of tax on Stoll, v. States United Von 726 F.2d In Second, the year income for taxable Cir.1984), 584, (9th said a con- we that in government argues that a tax eva- the “the amendment occurs when structive case, prove only must the sion substantially changed charged at crime [is] attempted evade a defendant that trial, impossible to know so that it [is] tax, of not the ex- amount but substantial grand jury have indict- whether the would See United of act tax evaded. amount actually proved.” The the crime ed for Stone, 770 F.2d (9th States added, however, that a mere variance court Cir.1985). that government concludes prosecution’s evidence when the occurs offense wheth- committed the same alleged in different from those proves facts $197,000 income on in er he the tax evaded id. the indictment. essential- line $227,000 in income.1 differ- situation which ly is between charged crime supports the ent evidence govern agree of the with both supports the evidence which that amend There was no ment’s contentions. Although charged. other than that crime we cannot of the indictment. While ment latter, amendment, requires an rever- Pisello cites do not that the cases assert variance, sal, former, does not war- claim, do weight to his we be lend some it affects the substan- rant reversal unless in those cases convictions lieve that of the defendant. See id. at 587. rights tial that may rested on theories would have grand jury to indict. persuaded have that time of receiv- contends At not the case here. worst That is is essential element tax ing income theories, theo- therefore, rested on two maintains, that conviction He evasion. $30,000 $115,000 “substantial" amount in income was a excluding the MCA income 1. Pisello's court, $197,000. payment The district of tax. III, found that the on of count consideration ry pay plain Pisello did not taxes on for that error. See United States v. Ben- Sugar payments, ny, Cir.1986). Hill Betaco and the 1417-18 Although we have theory pay Pisello also did not not addressed the taxes cor- questions rect means preserving about on the transaction. The MCA indictment the allocation of proof burden on those also rested two theories. The trials, nonjury we believe Pisello, believe, cases cited we dealt 23(c) Rule motion sufficed. See 2 C. resting proof with verdicts so different Wright, Federal Practice and Procedure accepted by from the proof indicting (2d 1982) (“A at 313-14 request ed. grand jury substantial special findings for appropriate way preju- defendant were affected. No such preserve appeal a contention that the dice exists here. applied court an erroneous standard of ”); see also v. Mor- law — ris, V. Cir.1959) F.2d 595-96 BURDEN PROOF ON COUNT II (same); States, Wilson United (9th Cir.1957) (same). challenges Pisello next the district proof. court's allocation of the burden B. What District Court Decided deciding In whether to characterize the payments that Pisello received If the required district court had advances, Hill as prove loans or loans, were we bench, “I from the find insuffi- stated would conclude that a loan cient to find that existed.” erred. States, evidence See Holland v. United *5 121, 138-39, proposed then U.S. parties 136-37, Both submitted find- 75 S.Ct. (1954) L.Ed. ings (holding govern- of fact conclusions law to the that the Pisello, always ment retains the ultimate district court. who submitted burden of his proving every element of a tax proposal 23(c), offense pursuant to Fed.R.Crim.P. beyond doubt). Also, a reasonable we proof single did not out the burden issue agree the that district court could have way, in any particular but did ask the court phrased its comment about whether a loan upon to “the rule that burden the existed carefully. more prove [any] to Government that transaction The was not a loan....” district court When district court said that accepted government’s proposal and there was insufficient to evidence show stated in its written order: “There was existed, that a accept loan we do not presented evidence at insufficient trial that thought view that that Pisello a existed or Mr. loan ever that Pisello in- had the burden to establish that a loan against a loan credited tended that be existed. The court merely observing him.” having that govern considered both ment and Pisello’s he evidence was decid that the words Pisello contends of the ing against the issue This in way him. no orders and written show that court’s oral indicates that court district did not required prove him to that the court government prove know that the must loans, Hill MCA and were beyond case a Appellate reasonable doubt. government’s obligation whereas it was require suspend review does that we prove to beyond a reasonable doubt that reason interpreting language while em income, they govern- were not loans. The ployed by judges. district We conclude ment that asserts Pisello failed raise the place that the court did not the burden of issue in district that court and Pisello proof on Pisello. misinterpreted has the court’s decision. VI. Raising A. the Burden Issue of Proof SUFFICIENCY OF THE EVIDENCE parties agree if The that ON COUNT III raised the of proof burden issue in the court, district may novo, we review it de government Pisello argues next that the that, otherwise, but may only produce we did not review sufficient evidence to sus- self his denying count III of the accountant under that tain conviction disagree. prove government To at- indictment. has shown that he autho- under 26 U.S.C. tempted tax evasion rized his accountant write a letter to only show must court, argues MCA. He then that in any deficiency of a tax the existence event, request cannot find a mere to cor- willful, constituting evasion act affirmative attempt rect an erroneous form "mis- attempted evasion. See Sansone v. lead” or “conceal.” This mischaracterizes 343, 351, States, 380 85 S.Ct. U.S. the evidence. After MCA sent the 1099 (1965). 1004, 1010, 13 L.Ed.2d Pisello, Form Pisello’s accountant could of a tax contest the existence does not only have known about the form if Pisello argues deficiency but that brought The to his attention. ac- finding attempted he to con- erred could not countant have concluded by giving checks his income worthless ceal payment was a loan rather than income MCA, causing to send his accountant persuaded by unless he was so Pisello. MCA, giving a to Bedi. check letter only The erroneous 1099 was Spies Court in v. United Supreme accepted. version of the facts were 364, 368, States, 63 S.Ct. 317 U.S. government successfully proved that ver- (1943), established the rele- 87 L.Ed. sion erroneous. The accountant’s letter vant standard: supports finding certainly of willfulness attempt affirmative willful [of [An] Spies standard. from, may be inferred conduct evasion] handling ... one’s affairs to such as ... C.Bedi’s Check making the records usual trans- avoid kind, conduct, any actions points out to mis- likely effect of which would be indicating produced no evidence that he If the tax-evasion mo- lead or conceal. a check to Bedi or that he used a delivered any part in such conduct the plays tive likely any check in manner to mislead the may be made out.... offense notes, moreover, Bedi IRS. He testi- negotiated any he fied that would have *6 A. MCA checks position given check to him. Pisello’s argues that the MCA checks exists, point strong. this The check how- a willful prove cannot that he committed ever, permits that it the inference was of uncontradicted act tax evasion because alone, check, might delivered. While the requested the testimony showed that conviction, cou- not when sustain him. fact is not control checks from This checks and the account- pled the MCA with recognized opportunity the to ling. Pisello letter, the allow a ant’s evidence would from MCA were his claim that guilty of to find Pisello rational trier fact part a played loans and thus evasion beyond III a reasonable doubt. under count gave checks to his conduct when he Attempting income to characterize MCA. is an old device that loans to evade taxes VII. tolerate have and cannot
the courts not See, enforcing e.g., United § THE PRODUCTION Wiese, 674, 677 750 F.2d v. AGENT’S NOTES True, Cir.1984). may wished argues his trial Finally, that by giving it the accommodate MCA to his district court denied unfair because district court’s checks. The conclusion compel production of the hand- motion to sought help was not himself Pisello also by government’s notes made written incorrect.
agents. Pisello maintains that
B. The Accountant’s Letter
production under ei-
ordered
should have
Act, 18
Jencks
U.S.C. §
ther the
letter
with the accountant's
Pisello deals
(1982), Brady Maryland, 373 U.S.
or
v.
him-
attempts
He
insulate
ways.
in two
1194, 1196,
10 L.Ed.2d
government
S.Ct.
hold that
must surrender
disagree.
(1963). We
all material connected
any
with
formal
produces
memoranda that
in circum-
Act
A. Jencks
stances such
those of this case. Our
gives
position rests on
assumption
Act
criminal
The Jencks
defendants
opportunity
impeach government
government
proceed
fair
will
fairly
in its han-
government
After a
dling
witness
Jencks
witnesses.
of
material. To do otherwise
trial,
requires
testified at
Act
has
jeopardize
only
rights
would
not
produce,
demand,
government
upon
any
accused,
those
but also the efficient admin-
by
made
the witness in
“statement”
justice
long
istration
in the
run.
possession
subject
to the
relates
mat-
Pisello also has
any
not shown that
state-
3500(b).
of his testimony.
ter
18 U.S.C. §
ments would have affected his trial. He
term
“statement” includes:
suggested any
has not
way that the notes
(1) a
by
written statement made
said
help him
could
overcome the hard evidence
signed
adopted
witness and
or otherwise
that the district court used to convict him.
approved by him;
or
Michaels,
ed States v. case, PENSION CABINET TRUST FUND (9th Cir.1986). present In the CALIFORNIA, FOR NORTHERN typed memoranda government produced Plaintiff-Appellant, order that response court's to the district Act government make Jencks available typed These to the defendant. materials CO., & MFG. VALLEY CABINET on handwritten memoranda were based Defendant, corporation, agents during by government notes taken I potential find witnesses. interviews argument that because merit in Pisello’s Davis, Clifford B. executor memoranda contain Jencks state typed Davis, of Robert J. estate ments, from which handwritten notes Defendant-Appellee. must contain derive also memoranda No. 87-15091. least, very At the this Jencks statements. the district remanded to case should be Appeals, Court of States hearing to deter evidentiary an Ninth Circuit. qualify notes mine the withheld whether Argued 1988. and Submitted Dec. time, At such Act materials.
Jencks Decided June determine, based court could inspection of the handwritten in camera
notes, *8 in the fairness proposition faith protect will government’s conduct me hard of the accused seems Moreover, have stated that we sell. concerning materials are
questions Jencks resolve. John-
son, F.2d at 1320. notes contain Although statements. this contain cies from the written memoranda and agents has stated that notes taken FBI testimony at trial might that he have used prospective in interviews with government’s impeach witnesses. may statements, witnesses contain such see unpersuaded We are that such evidence Harris, States v. could have affected the outcome
Notes
notes the handwritten are whether Act materials. See United Jencks Johnson, F.2d Cir. 1975) J.) (Sneed, (holding that the district compel produc refusing court erred “it acted tion of handwritten notes because them, or oth inspecting in camera without erwise.”). opinion its conclusion majority rests properly in court acted the district regard “on the handwritten notes pro- will that the assumption handling in its of Jencks materi- fairly ceed Yet Opinion at 768. Majority al.” authority sup- legal no majority offers Rather, assumption. the ma- port of this position by the justify jority seeks assume that that unless courts rationale handling fairly acts materials, accused Jencks justice administration and the efficient jeopardized. will Id. be