Tax Protestor or Tax Scholar - The Geithner Defense

I was reading yet another tax protestor criminal case (United States v. Hendrickson, 664 F. Supp. 2d 793 (ED MI 2009)), and found references to protestor or scholar, which reminded me of the old nursery rhyme:

Tinker, Tailor,
Soldier, Sailor,
Rich Man, Poor Man,
Beggar Man, Thief.

See Wikipedia entry here.

Tax protestors -- the bad amongst which DOJ now calls tax defiers -- are not normally noteworthy to mainstream tax practitioners or students, but in the nursery rhyme litany above, most would be characterized as thiefs, and certainly not protestors or scholars (OK, they are not in the litany, but perhaps we could insert them). These guys are just tax terrorists seeking to throw a monkey wrench or IED equivalent into the tax system. Still, I think a snippet from Hendricksen is interesting because it deals with the Geithner defense (you didn't prosecute Geithner, therefore you can't prosecute me). Hendricksen had published how to tax protest books made the standard arguments and even for himself had bought into and practised his assertions. In his criminal case, he asserted inter alia that the Government had selected him because of his prominence in the tax protestor community (through his book, Cracking the Code, and web site). On that issue, the defendant invoked a variation of the Geithner defense. Here's how the court dealt with the argument, nicely also handling his claims that he was a scholar rather than a protestor:

In any event, whether Defendant is more properly characterized as a "protestor" or a "scholar," the Government has precisely the same legitimate interest in prosecuting him. Regardless of whether Defendant has affirmatively sought notoriety, fame, or publicity, and regardless of whether he has urged others to follow his lead or has instead attempted to dissuade them from doing so, he acknowledges that "thousands" of people have read Cracking the Code, that a significant number of these readers have "filed tax forms consistent with" his analysis of the tax laws as elucidated in this book, and that this has resulted in the IRS issuing "millions in refund checks to filers who had claimed that money was improperly withheld." (Defendant's 1/15/2009 Motion to Dismiss, Br. in Support at 3 (footnote omitted).) Under these circumstances, the Government could permissibly conclude that the prosecution of Defendant would serve as an effective deterrent to those who might be inclined to apply his analysis to their own tax filings, and that this might staunch the flow of more widespread, but potentially harder to detect, submission of "zero wage" tax forms by readers of Cracking the Code. See Kelley, supra, 769 F.2d at 218. Indeed, the courts have recognized that prominence alone -- whether derived from protest activities or from political or social stature in the community -- is a permissible factor in selecting individuals for prosecution. See, e.g., United States v. Hastings, 126 F.3d 310, 314-15 (4th Cir. 1997) ("[A] person's public renown may be properly considered among other factors when deciding whether to pursue criminal sanctions for a violation of the law."). n16

n16 Notably, by citing Treasury Secretary Timothy Geithner and former Senate Majority Leader Tom Daschle as individuals who have "blatantly and admittedly violated the tax laws" but have nonetheless avoided criminal prosecution, Defendant's 5/22/2009 Suppl. Br. at 3), Defendant implicitly acknowledges the value of prosecuting prominent violators of the tax laws, regardless of whether such violations stem from any opposition to those laws. That the Government has failed to prosecute all such prominent violators surely does not detract from its legitimate interest in doing so in a particular case. [END OF FOOTNOTE]

Finally, the Court fails to see how Defendant could possibly strengthen his appeal to First Amendment principles, and thereby distinguish the rulings in Hazel and the other above-cited cases, by denying that he has engaged in any sort of protest against the Government, its laws, or its tax policies. These decisions, after all, do not recognize the Government's right to prosecute a defendant because of his or her protected First Amendment activity, but in spite of this protected activity. The First Amendment embodies "a profound national commitment to the principle that debate on public issues should be uninhibited, robust, and wide-open, and that it may well include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public officials." New York Times Co. v. Sullivan, 376 U.S. 254, 270, 84 S. Ct. 710, 721 (1964). Moreover, the Supreme Court has emphasized that "[t]o punish a person because he has done what the law plainly allows him to do is a due process violation of the most basic sort." Bordenkircher v. Hayes, 434 U.S. 357, 363, 98 S. Ct. 663, 668 (1978). The law of selective prosecution rests upon precisely these principles, permitting limited judicial inquiry into a matter that ordinarily "rests entirely in [the prosecutor's] discretion" -- namely, "the decision whether or not to prosecute," Bordenkircher, 434 U.S. at 364, 98 S. Ct. at 668 -- in order to ensure that the exercise of this discretion remains within "constitutional constraints," Wayte, 470 U.S. at 608, 105 S. Ct. at 1531 (internal quotation marks and citation omitted). Under this law, a prosecutor has no greater (or lesser) latitude, and the relevant constitutional constraints are no weaker (or stronger), when the subject of prosecutorial discretion is a vehement protestor against the government than when he or she is engaged in scholarly discourse. To hold otherwise would be to permit what the law of selective prosecution is designed to prohibit -- namely, prosecutorial decisions based upon the nature or content of an individual's protected First Amendment expression.

Plainly, then, it is of no aid to Defendant to establish that he is a scholar engaged in a neutral study of the tax code, rather than a critic of or protestor against federal tax law or policy. Both "abstract discussion" and "vigorous advocacy" qualify as protected forms of expression under the First Amendment, see N.A.A.C.P. v. Button, 371 U.S. 415, 429, 83 S. Ct. 328, 336 (1963), so the proper disposition of Defendant's claim of selective prosecution cannot turn upon the characterization of Cracking the Code as one or the other. In either event, Defendant's burden is precisely the same -- to show that he was selected for prosecution on the impermissible basis of his protected speech, and not on grounds (such as prominence) that the Government may legitimately consider. As explained, Defendant has not made a sufficient showing on this point to warrant discovery on his claim of selective prosecution, much less dismissal of the charges against him on this ground.

Interestingly but perhaps not surprisingly, Hendricksen is represented in this judicial crusade by Mark Lane, an attorney and noted conspiracy theorist who wrote Rush to Judgement among other books. Mr. Lane's Wikipedia entry is here. Mr. Lane has also represented another well known tax protestor, Robert Schultz. See United States v. Schultz, 517 F.3d 606 (2d Cir. 2008) (Lane on brief for Schulz appearing pro se), and We the People Foundation, Inc. v. United States, 485 F.3d 140 (D.C. Cir. 2007) (with Schulz on brief).