Saturday, July 14, 2018

Tax Obstruction -- Is Marinello's Nexus Requirement Broader than Obstructing or Intending to Obstruct? (7/14/18)

United States v. Lawson, 2018 U.S. Dist. LEXIS 115310 (D. Alaska 2018), here, a U.S. magistrate judge rejected the defendant's claim that, as interpreted in Marinello v. United States, ___ U.S. ___, 138 S. Ct. 1101 (2018), § 7212(a), tax obstruction, requires the defendant's actions must intend to obstruct a pending IRS administrative proceeding.  The Court said that all Marinello requires is that the Government prove a nexus between the obstructive conduct and a pending proceeding.  I am struggling to understand how a person's conduct can have a nexus to a pending proceeding but the actor does not obstruct or intend to obstruct the proceeding.

By order dated 7/10/18, the district court adopted and accepted the magistrate judge's opinion in its entirety.  The docket entries are here.

I quote in full magistrate judge's order on the point (please note that I use the cleaned up procedure to strip out unnecessary portions):
C. The Mens Rea of § 7212(a) Requires Proof that the Defendant Acted with an Intent to Secure an Unlawful Benefit for Himself or Another 
Finally, Lawson argues that count five should be dismissed because the indictment fails to allege that he committed the obstructive acts with the intent to obstruct a specific IRS proceeding. (Doc. 208 at 1, 3). This claim is without merit. 
Prior to Marinello, the Ninth Circuit held that the elements of corruptly endeavoring to obstruct the due administration of the internal revenue code are: "(1) corruption ... and (2) an attempt to obstruct the administration of the IRS." The Ninth Circuit in turn defined "corruptly" under § 7212(a) as performed with the intention to secure an unlawful benefit for oneself or for another. Thus, it is clear that, at least prior to Marinello, that the mens rea of § 7212(a) only required proof that the defendant acted with an intent to secure an unlawful benefit, as opposed to an intent to obstruct an IRS investigation or proceeding. 
Nothing in Marinello suggests that the mens rea of § 7212(a) has changed. Summarizing its prior decision in Aguilar, the Marinello court stated: 
In interpreting that statute, we pointed to earlier cases in which courts had held that the Government must prove an intent to influence judicial or grand jury proceedings.  We noted that some courts had imposed a "'nexus' requirement": that the defendant's act must have a relationship in time, causation, or logic with the judicial proceedings. And we adopted the same requirement. 
Marinello v. United States, 138 S. Ct. 1101, 1106 (2018) (emphasis added). 
That is, the Aguilar court considered the possibility of requiring the government to prove that the defendant intended to obstruct a grand jury proceeding, but instead elected to join those courts holding that obstruction of justice requires proof of a "nexus" between the defendant's obstructive acts and a judicial proceeding. 
As the Supreme Court clearly stated in the conclusion of Marinello, 26 U.S.C. § 7212(a) requires the government to prove a nexus between the defendant's acts and an IRS proceeding that was either pending or reasonably foreseeable at the time of the obstructive acts. As construed in Marinello, § 7212(a) does not require explicit proof that the defendant intended to obstruct an IRS proceeding.
The Government's opposition, here, filed after the magistrate judge's decision (apparently for consideration by the district judge who, by the date of filing, had already adopted the magistrate judge decision.

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