United States v. William Waller

• Court: Court of Appeals for the Ninth Circuit
• Decided: November 12, 2020
• Docket: 19-10367
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS NOV 12 2020 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA, No. 19-10367

Plaintiff-Appellee, D.C. No. 2:18-cr-00112-JCM-VCF-1 v.

WILLIAM WALLER, MEMORANDUM*

Defendant-Appellant.

Appeal from the United States District Court for the District of Nevada James C. Mahan, District Judge, Presiding

Submitted October 14, 2020** San Francisco, California

Before: FERNANDEZ, WARDLAW, and COLLINS, Circuit Judges.

William Waller appeals the district court’s denial of his motion for acquittal

on two counts of willful failure to file a tax return under 26 U.S.C. § 7203 and one

count of attempt to evade or defeat tax under 26 U.S.C. § 7201. We have

jurisdiction under 28 U.S.C. § 1291, and we affirm.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2).

Panel 1. The district court correctly concluded that venue was proper in

Nevada for the failure to file charges. “Failure to file a tax return is an offense

either at the defendant’s place of residence, or at the collection point where the

return should have been filed.” United States v. Hicks, 947 F.2d 1356, 1361 (9th

Cir. 1991) (citation omitted). This is true even if the defendant is required to file

his return in a state in which he does not reside. Id. The Nevada venue was proper

because Waller resided in Nevada.

2. The district court properly concluded that sufficient evidence

supported the attempted tax evasion conviction, even though Waller did not

receive a notice of tax deficiency for the relevant years. “The elements of

attempted income tax evasion under 26 U.S.C. § 7201 are: (1) willfulness; (2) the

existence of a tax deficiency; and (3) an affirmative act constituting an evasion or

attempted evasion of the tax.” United States v. Kayser, 488 F.3d 1070, 1073 (9th

Cir. 2007) (citation omitted). To prove willfulness, the government must show that

the “law imposed a duty on the defendant, that the defendant knew of this duty,

and that he voluntarily and intentionally violated that duty.” Cheek v. United

States, 498 U.S. 192, 201 (1991). “A tax deficiency exists from the date a return is

due to be filed” and is not dependent on a final assessment by or notice of

deficiency from the IRS. United States v. Voorhies, 658 F.2d 710, 714 (9th Cir.

1981); see also 26 U.S.C. § 6151(a). There was sufficient evidence for the jury to

Panel 2 conclude that Waller knew of his deficiency and intentionally violated his duty to

pay tax: Waller’s real estate brokerage provided him with 1099 Forms; he had paid

income tax previously; and he had been penalized for filing a “zero” return in the

past.

3. The district court did not abuse its discretion by not admitting into

evidence two video clips of former IRS agents discussing tax law because the

probative value of the videos was outweighed by the risk of unfair prejudice. The

video evidence was “repetitive, only marginally relevant,” and “pose[d] an undue

risk of . . . confusion of the issues.” Holmes v. South Carolina, 547 U.S. 319, 326–

27 (2006) (cleaned up). Because Waller was able to “present the substance” of his

defense by testifying to the contents of the videos and how they affected his

subjective state of mind, the district court’s evidentiary ruling achieved the proper

balance under Federal Rule of Evidence 403 and did not violate Waller’s

constitutional rights. United States v. Waters, 627 F.3d 345, 353–54 (9th Cir.

2010); see also United States v. Bergman, 813 F.2d 1027, 1029–30 (9th Cir. 1987);

United States v. Malquist, 791 F.2d 1399, 1402 (9th Cir. 1986).

4. The district court properly rejected Waller’s requested entrapment by

estoppel instruction because there was no “foundation in the evidence” for the

instruction. United States v. Whittemore, 776 F.3d 1074, 1078 (9th Cir. 2015)

(citation omitted). To succeed under an entrapment by estoppel theory, the

Panel 3 defendant “must show that (1) an authorized government official, empowered to

render the claimed erroneous advice, (2) who has been made aware of all the

relevant historical facts, (3) affirmatively told [the defendant] the proscribed

conduct was permissible, (4) that [the defendant] relied on the false information,

and (5) that [the] reliance was reasonable.” United States v. Schafer, 625 F.3d 629,

637 (9th Cir. 2010) (quoting United States v. Batterjee, 361 F.3d 1210, 1216 (9th

Cir. 2004)). Waller claimed to have relied on internal IRS records, obtained

through a Freedom of Information Act request, which included a computerized

code that read “Mail File Requirement: 01= Return not required to be mailed or

filed. (1040 not required).” The district court correctly found that single line was

too vague to qualify as the affirmative statement required to establish entrapment

by estoppel. See United States v. Ramirez-Valencia, 202 F.3d 1106, 1109 (9th Cir.

2000) (“To succeed under [the entrapment by estoppel] theory, defendant must do

more than show that the government made vague or even contradictory

statements.”) (cleaned up).

AFFIRMED.

Panel 4