NOT FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA,

Plaintiff

- Appellee,

v. JEFFREY BOWEN,

Defendant

- Appellant. No. 22

- 10115 D.C. No. 3:19

- cr - 00010

- MMD

- CSD

- 3

MEMORANDUM *

Appeal from the United States District Court for the District of Nevada Miranda M. Du, Chief District Judge, Presiding Argued and Submitted February 7, 2023 San Francisco, California Before: BYBEE and BUMATAY, Circuit Judges, and BENNETT, * * Senior District Judge. Partial Dissent by Judge BYBEE. Defendant

- Appellant Jeffrey Bowen appeals his conviction for conspiracy to defraud the United States , in violation of 18 U.S.C. § 371. Bowen was the owner and operator of J&L Distributing, Inc. (“J&L”), a distributor of Kirby

- brand vacuum

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36

- 3.

** The Honorable Richard D. Bennett, United States Senior District Judge for the District of Maryland, sitting by designation. 

# FILED

MAY 8 2023 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS2

cleaners. At trial, t he g overnment established that Bowen conspired with his two co defendants , Saul Alessa and Jackie Hayes , to conceal Alessa’s income from the IRS by employing him at J&L from 2010 to 2013 and reporting his income on Hayes’ IRS Forms 1099 . Bowen received a nominal prison sentence, and the three co defendants were held jointly and severally liable for $502,398.23 in restitution

— account ing for Alessa’s entire tax debt and associated penalties dating back to 1998. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm in part and vacate in part. Specifically, we affirm Bowen’s conviction, we vacate the restitution award, and we remand for a recalculation of the proper amount of restitu tion. Motion for Judgment of Acquittal: This court reviews the denial of a Rule 29 motion for judgment of acquittal based on insufficiency of the evidence de novo, and will affirm if “ any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.” Unit ed States v. Sineneng

- Smith , 982 F.3d 766, 776 (9th Cir. 2020) (quoting United States v. Nevils , 598 F.3d 1158, 1163

– 64 (9th Cir. 2010)) (emphasis in original)

. C onspiracy to defraud the United States , in violation of 18 U.S.C. § 371, has three essential e lements : “ [(1)] An agreement to achieve an unlawful objective, [(2)] an overt act in furtherance of the illegal purpose, [(3)] and the requisite intent to defraud the United States. ” United States v. Tuohey , 867 F.2d 534, 537 (9th Cir. 1989)

. Bowen argues that the evidence adduced at trial cannot sustain a finding of intent, reiterating his trial testimony that Alessa was an3

independent contractor of Hayes, and Hayes was an independent contractor of J&L. However, several witnesses testified tha t Alessa was working at J&L, that Bowen instructed them to conceal this fact on the company’s contracts, books, and records , and that Bowen manufactured the independent contractor relationship to conceal Alessa’s income . Accordingly, there is ample evidenc e by which a rational trier of fact could conclude that Bowen acted willfully. Impeachment Evidence: We review a district court’s decision to exclude impeachment evidence for an abuse of discretion. United States v. Geston , 299 F.3d 1130, 1137 (9th Cir. 20 02). On cross

- examination, Jackie Hayes claimed that her former attorney , Richard Molezzo, failed to convey a plea offer by the Government.
Bowen moved to compel Molezzo to testify to establish that this assertion was false , and the district court denied his motion

. This ruling was not an abuse of discretion

. Whether Hayes lied about this plea offer is a strictly collateral matter

— it is generally irrelevant to the conspiracy at issue and the critical question of Bowen’s scienter

. Fed. R. Evid. 608(b ). 1 Additionally , Molezzo’s testimony was properly excluded under Rule 403, as it posed a substantial risk of “confusing the issues” or “misleading

1 Although Rule 608(b) does not apply to evidence offered on a theory of impeachment by contradiction, this exception is ordinarily confined to statements offered on direct examination. See United States v. Kincaid

- Chauncey , 556 F.3d 923, 932

– 33 (9th Cir. 2009) , abrogated on other grounds by Skilling v. United States , 561 U.S. 35 8 (2010) . Even if we were to apply this exception in this appeal , the district court’s Rule 403 analysis provides an independent basis to affirm.4

the jury.” Fed. R. Evid. 403. Moreover, it was entirely cumulative, as five additional witnesses testified regarding Hayes’ character for dishonesty. 2 Expert Testimony: We review the exclusion of expert testimony for an abuse of discretion. Elosu v. Middlefork Ranch Inc. , 26 F.4th 1017, 1023 (9th Cir. 2022)

. Bowen claims that the district court improperly limited the testimony of his financial expert, Jeffrey Dean Smith, who testified regarding the tax implications of an independent contractor relationship. However, the record reflects that the district
court allowed Smith to testify, and that the expert expressed all of the opinions that Bowen claims were improperly excluded. While the court required Smith to qualify his testimony with the phrase “if the jury concludes,” Bowen cites no authority for the propos ition that this caveat is error, much less that it is prejudicial

. United States v. Seschillie , 310 F.3d 1208, 1214

– 15 (9th Cir. 2002); accord Fed. R. Crim. P. 52(a). Additionally , as defense counsel proposed this limitation, Bowen’s challenge to this issu e is waived under the doctrine of invited error. United States v. Magdaleno , 43 F.4th 1215, 1219

– 20 (9th Cir. 2022)

. Restitution Award: We review the district court’s restitution order for abuse of discretion, and we review the underlying factual findings for clear error

. United

2 Bowen’s claim that this ruling deprived him of “a meaningful opportunity to present a complete defense” is meritless. Holmes v. South Carolina , 547 U.S. 319, 324 (2006) (citation omitted) . Whether Molezzo informed Hayes of a plea offer was far from “the defendant’s main defense . . . to a critical element of the government’s case.” United States v. Evans , 728 F.3d 953, 967 (9th Cir. 2013).5

States v. Batson , 608 F.3d 630, 632

– 33 (9th Cir. 2010). In a criminal case, a district court may only order restitution “for actual losses caused by the defendant’s criminal conduct.” United States v. Gamma Tech Indus., Inc. , 265 F. 3d 917, 926 (9th Cir. 2001) ; see 18 U.S.C. § 3664(a)

. Actual losses must be calculated “ by comparing what actually happened with what would have happened if the defendant had acted lawfully.” United States v. Fu Sheng Kuo , 620 F.3d 1158, 1164 (9th Cir. 2010). The district court held the co

- defendants liable for $502,398.23 in restitution,

enc ompassing Alessa’s entire tax debt and associated penalties from 1998 to 2013. This was an abuse of discretion. Although “the court can order restitution for . . . any conduct that was part of the conspiracy,” United States v. Reed , 80 F.3d 1419, 1423 (9t h Cir. 1996), the co

- defendants were convicted of conspiring to conceal Alessa’s income between 2010 and 2013. The parties dispute the precise total of Alessa’s earnings during this timeframe, but their estimates range from $170,000.00 to $200,000.00. What ever the exact total Alessa earned during the conspiracy years,
t his amount constitutes the “actual losses” attributable to the conspiracy, Gamma Tech Indus., Inc. , 265 F.3d at 926, and the maximum amount that the IRS could have garnished had the conspirac y not occurred , Fu Sheng Kuo , 620 F.3d at 116 4

. The dissent argues that this amount only accounts for the defendant’s ability to pay and does not properly reflect the government’s “actual losses.” Gamma Tech Indus., Inc. , 265 F.3d at 926. We respectfully d isagree. As discussed above, actual6

losses are calculated “by comparing what actually happened with what would have happened if the defendant had acted lawfully.” Fu Sheng Kuo , 620 F.3d at 1164. Additionally, as this Court has previously noted, “loss for r estitution purposes covers only actual loss,” and not “intended loss.” United States v. Hunter , 618 F.3d 1062, 1065 (9th Cir. 2010). Accordingly, the government’s “actual losses” are limited to the amount it could have actually collected had the conspiracy not occurred, not the amount the conspirators “intended” to conceal. Whatever the object and purpose of the conspiracy may be, the record reflects that the conspirators concealed Alessa’s income when he returned to work at J&L between 2010 to 2013. 3
For the foregoing reasons, w e VACATE the restitution award and REMAND for recalculation . On remand, the district court is instructed to recalculate this award based on the exact amount of income Alessa received during the conspiracy years.
AFFIRMED in part, VACATED in part, REMANDED.

3 We likewise respectfu lly disagree with the dissent’s argument that we have misstated the scope of the conspiracy. We agree that the indictment and judgment listed March 31, 2014, as the end of the conspiracy, but the government’s “actual losses” are limite d to the total income concealed by the three co - conspirators. The record indicates that Bowen only concealed Alessa’s income until November 2013, when Bowen enrolled Alessa as a W

- 2 employee and began to report his earnings , and the govern ment acknowledged that the conspiracy extended into 2014 only because Bowen submitted an IRS Form 1099 that year reporting Alessa’s 2013 commissions in Hayes’ name. However, we make no formal findings regarding the precise dates of the conspir acy or the exact amount that was concealed.United States v. Bowen , No. 22-10115

BYBEE, J., dissenting in part: I agree with the m ajority that we should affirm the judgm ent of the district court regarding the m otion for judgm ent of acquittal, im peachm ent evidence, and expert testim ony. I disagree, however, with the panel’s assessm ent of Bowen’s restitution award. To calculate restitution, we look at the position the victim would have been in had the defendant acted lawfully. United States v. Fu Sheng Kuo , 620 F.3d 1158, 1164 (9th Cir. 2010). However, in conspiracy cases, a co-conspirator’s liability expands to include “any conduct that was part of the conspiracy.” United States v. Reed , 80 F.3d 1419, 1423 (9th Cir. 1996). The lim iting factor is the victim ’s actual losses, United States v. Bussell, 504 F.3d 956, 964 (9th Cir. 2007), not the defendant’s ability to pay, United States v. Kubick , 205 F.3d 1117, 1128 (9th Cir. 1999) (18 U.S.C. § 3663A(f)(1)(A) requires restitution without regard of the defendant’s econom ic circum stances). Further, “we have held that restitution orders can include losses caused by related conduct for which the defendant was not convicted.” United States v. Meredith , 685 F.3d 814, 827 (9th Cir. 2012). Here, the m ajority m akes two errors. First, it lim its actual loss to “the

m axim um am ount the governm ent could have garnished had the conspiracy not occurred,” Mem . Dispo. at 5 (em phasis added), instead of the governm ent’s actual



# FILED

MAY 8 2023
M OLLY C. DWYER, CLERK U.S. COURT OF APPEALSlosses . This calculation is just another way of saying that the IRS is lim ited to

collecting what Alessa could have paid during the tim e of the conspiracy. Our precedent sets no such lim it on calculating restitution. The m ajority also lim its the conspiracy’s scope contrary to evidence in the record. The m ajority states that “co-defendants were convicted of conspiring to conceal Alessa’s incom e between 2010 and 2013.” Mem . Dispo. at 5. But the indictm ent charged Bowen, Hayes, and Alessa from “before 2010” to “about March 2014.” The indictm ent also charged all three defendants with concealing Alessa’s business activity in order to convince the IRS that he had “no source of incom e that could be used to pay . . . outstanding taxes, penalties, and interest due and owing.” Thus, the object of their conspiracy was to prevent the collection of Alessa’s entire tax debt, penalties, and interest. Accordingly, the court described the purpose of the conspiracy as “to avoid . . . outstanding tax liabilities.” With the correct legal fram ework in m ind, the governm ent’s actual losses in this case total $502,298.23, com prising Alessa’s total unpaid taxes, penalties, and interest. The district court correctly found that Bowen jointly and severally liable for the entire restitution award. See Meredith , 685 F.3d at 827.

2For these reasons, I would affirm the district court’s calculation of

restitution, and I respectfully dissent from the m ajority’s disposition regarding restitution.

3