1. Schiff's argument, that appellate counsel was ineffective for not appealing the district court's exclusion of evidence of his bipolar disorder, fails. Schiff's claim regarding the exclusion of mental health evidence is similar to one raised by co-defendant Cohen on direct appeal, and which formed the basis for this Court reversing Cohen's conviction and remanding for a new trial. United States v. Cohen, 510 F.3d 1114, 1123-27 (9th Cir. 2007). But Schiff and Cohen were situated very differently with respect to knowledge about the validity of their beliefs. Even assuming Schiff's appellate counsel was ineffective, Schiff cannot demonstrate that he was harmed by counsel's failure to raise this issue on appeal.
In Cheek v. United States, 498 U.S. 192, 201, 111 S. Ct. 604, 112 L. Ed. 2d 617 (1991), the Court distinguished between "innocent mistakes caused by the complexity of the Internal Revenue Code," as opposed to positions that "reveal full knowledge of the provisions at issue and a studied conclusion, however wrong, that those provisions are invalid and unenforceable." Id. at 205. With regard to the second category, the Court held that "a defendant's views about the validity of the tax statutes are irrelevant to the issue of willfulness." Id. at 206.
On direct appeal, this Court characterized the evidence against Schiff as "overwhelming, particularly the evidence that he intended to deceive the government through the use of zero returns." United States v. Cohen, 262 F. App'x 14, 16 (9th Cir. 2007). The overwhelming evidence at trial was that Schiff was aware his claimed beliefs lacked merit and that he simply disagreed with the law. Schiff had previously been punished for filing zero returns. He knew that numerous tax returns submitted by his clients had been returned as frivolous by the IRS and had resulted in penalties upheld by courts. He also knew his positions regarding tax law were rejected in every court to consider them.
Trial testimony also showed that, knowing his beliefs and activities did not comport with tax law, Schiff counseled his clients to undertake affirmative acts of misrepresentation. Schiff engaged in evasive conduct too — after his bank account was levied upon by the IRS, he opened bank accounts under false taxpayer identification numbers and avoided IRS seizure of his vehicle by titling it in a friend's name.
Given the extensive evidence that Schiff knew his views of the tax law were incorrect, he cannot establish that his Cheek good-faith defense was prejudiced by counsel's decision not to raise on direct appeal the district court's suppression of evidence of his bipolar disorder.Just taking this discussion on its face, I am not sure it is right. The reasoning, if I understand it correctly, is that Schiff knew he was violating the law and that is sufficient for conviction under the Cheek standard. However, it seems to me that the argument is that his bipolar condition prevented him from understanding the consequences of that knowledge, that the evidence should have been presented to the jury, and that failure to raise the issue on appeal was inadequate assistance of counsel. I just am not convinced that the Ninth Circuit's stated reasoning engages that issue. Perhaps that is why it is an unpublished opinion.
I would appreciate others' comments.
Schiff was represented on appeal by Alan Ellis (and others). Ellis is a noted expert in Federal Sentencing, Prison and Post-Conviction Law. See his website here.