Thursday, March 10, 2011

A Third Theory for Conviction in the Larson, Pfaff and Ruble Cases -- Aiding and Abetting / Accomplice Liability

As I noted in an earlier blog titled More on 18 USC § 2(b) Liability from the Larson / Pfaff / Ruble Case, the Government asserted criminal liability for tax evasion directly under 7201 and also asserted liability under 18 USC § 2(b).  Judge Kaplan described these as the first and second theories of criminal liability for evasion. There was a third theory -- aiding and abetting liability -- often called accomplice liability -- under 18 USC § 2(a). Accomplice liability requires that a principal commit the crime; if a defendant aids and abets the actual principal, the accomplice is deemed a principal.

I thought I would offer readers the Judge Kaplan's instructions on accomplice liability (from pp. 5243-5246 of the transcript).

It is unlawful for a person to aid, abet, counsel, command, induce or procure someone else to commit an offense. A person that does that is just as guilty of the offense as someone who actually commits it. Accordingly, you may find a defendant guilty of tax evasion described in one or more of the substantive tax evasion counts, if you find that the government has proved beyond a reasonable doubt that another person actually committed the crime of tax evasion, and that the defendant whom you are considering aided and abetted in the commission of that crime.

Now, as you can see the first requirement is that another person must have committed the crime charged. If you so find beyond a reasonable doubt, then you have to decide if the defendant you are considering aided and abetted in the commission of the offense. But if nobody committed the offense, obviously a defendant can't be convicted on the theory of aiding and abetting.

Now, before I go on to the factors that go into deciding whether somebody has aided and abetted in the commission of a crime, I need in this case to point out to you that theoretically there are two categories of people who might have the committed tax evasion and, thus, might have been aided and abetted by somebody.

One group of people is the taxpayers who filed the tax returns. It, of course, is theoretically possible that one or more of the taxpayers whose tax returns are the subjects of these various counts, might himself have committed the crime of tax evasion.

I instruct you, however, that there is no contention by the government that any of the taxpayers whose returns are the subjects of a tax evasion counts in this case, and who is not a defendant here, committed the crime of tax evasion. No such contention.

You, therefore, are instructed that no defendant can be found guilty of tax evasion on the theory that he aided and abetted any taxpayer who is not a defendant in this case in committing a crime of tax evasion. Off the table.

But there is a second group, and this is the group you must consider. The second group consists of other individuals who might have been involved in one way or another in the matters about which you have heard in this trial.

With respect to Counts Fourteen, Fifteen, Seventeen, Nineteen through Twenty-Four, Twenty-Nine, Thirty-Two and Thirty-Three, and those counts alone, they include, among others, defendants in this case other than the particular defendant you are considering, in other words, in considering a particular tax evasion count against Mr. Larson, for example, you may consider whether he aided and abetted Mr. Pfaff or Mr. Ruble in committing tax evasion.

In considering a particular count against Mr. Pfaff, you may consider whether he aided and abetted Mr. Larson or Mr. Ruble in committing tax evasion. And in considering a particular count against Mr. Ruble, you may consider whether he aided and abetted Mr. Larson or Mr. Pfaff in committing tax evasion.

If you conclude with respect to any count that any of these people, other than the particular defendant whom you are considering, committed the crime of tax evasion, with respect to the taxpayer's tax liability for that year, on either of the first two alternative theories, then you should consider also whether the defendant whom you are considering aided and abetted that person or persons in doing so.

In order to aid or abet another in committing a crime, it is necessary that a defendant willfully and knowingly associate himself in some way with the crime, and that he willfully and knowingly seek by some act, to help make that crime succeed. In making that determination, you will apply the definitions of knowingly and willfully that I have given you already.

The mere presence of a defendant where a crime is being committed, even with knowledge by the defendant that a crime is being committed, or the mere acquiescence by a defendant in the criminal conduct of someone else, is not enough to establish aiding and abetting. An aider and abettor must have some interest in the criminal venture.
And, there was yet another theory of liability -- Pinkerton liability -- which was presented to the jury but rendered moot because the jury acquitted of conspiracy. 

With three non-conspiracy theories of criminal liability for evasion posited to the jury, one has to wonder what the jury was to do and did with those theories. We really don't know because the jury rendered general guilty verdicts for Messrs. Larson, Pfaff and Ruble on the evasion counts. But, Judge Kaplan did give an instruction that the jurors needed to be unanimous on one of the theories in order to convict, although the general verdict prevents from knowing or testing their unanimity. The judge's instructions on unanimity were (p. 5246):

So, under the notion that juries understand and apply instructions, it would appear that the jury did find unanimity on some theory of guilt.

I would like to comment briefly on these three theories because I think the jury would have had a tough time sorting them out.

Let me start with the direct liability for evasion under 7201 without any need for derivative vicarious liability under 18 USC 2 or Pinkerton.  The jury could have convicted on that direct liability theory alone and, I suppose, I would have nothing else to say.  But we don't know that that is the theory the jury convicted on.  So, I do have something else to say.

I turn first to aiding and abetting / accomplice liability theory (hereafter accomplice liability).  There is considerable overlap between accomplice liability and conspiracy.  The jury acquitted on the conspiracy charge and, I suppose, one might infer that it is likely the jury may not convicted for tax evasion on the accomplice liability theory.  (Perhaps I will discuss in a later blog the relationship of vicarious liability under accomplice liability and Pinkerton.) Moreover, accomplice liability requires at least one actual principal -- in this case, to convict on accomplice liability, the jury would have had to find that one or two of the defendants aided and abetted one or two of the other defendants who were actual principals in the commission of the crime of tax evasion.  Having watched this case closely, I am not sure that one can logically say that one or two were principals and one or two were accomplices; either they were all principals or they were all accomplices in search of a nonexistent actual principal;  In either case, they was no accomplice liability.  This logic -- if indeed it is logic -- would suggest that that the jury did not convict under accomplice liability (based on the legal fiction that the jury surely did the right thing because it would have realized that accomplice liability was a nonsequitur under the facts).

Now, turning to liability under 2(b) (the theory that Larson, Pfaff and Ruble used the taxpayer's as innocent or at least not guilty dupes to effect tax evasion), I said what I could in the previous blog.  So, I guess I won't turn to it.

3/13/11 addendum to further discuss "causer" liability under 2(b):  I may post something more detailed on this later, but after more research, I am at the point where 2(b) causer liability makes no sense.  Either the defendants were guilty as direct principals under 7201, or they were not guilty at all.  I have explained my reasons that accompliace liability is not applicable.  Now, as best I understand 2(b) and its history, it really did not effect a change in the prior law that would have made someone a priniciple if they effect the criminal act through any nonguilty tool -- whether that tool is inanimate (e.g., a shotgun) or animate (a caused person who is not guilty of any crime).  Hence, under the facts as I understand them, the instructions to the jury should have been solely under 7201 and no mention of 2(a) or 2(b) should have been made.  Since we don't know whether the jury rejected 7201 liability but then convicted under 2(a) or 2(b), the verdict is necessarily suspect.  I hope that some of the prosecutor types who are so enamored with 2(a) and 2(b) will explain how, under the facts of this case, the jury could have based its guilty verdict on 2(a) or 2(b) to make persons otherwise not actual principals deemed principals for the substantive offense.  Yet the instructions clearly told the jury that it could do exactly that.

1 comment:

  1. Unrelated to Pfaff, but 2 articles which might be of interest as a new thread/topic...

    According the WSJ.. "More taxpayers renounced their U.S. citizenship in 2010 than in the previous three years combined or in any year since at least 2003."


    Wall Street Journal


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