GOVERNMENT’S OPPOSITION TO 

DEFENDANT’S MOTION TO DISMISS 

FOR VINDICTIVE PROSECUTION (DOC. 73) - 1

BILLY J. WILLIAMS, OSB #901366 

United States Attorney 

District of Oregon 

STUART A. WEXLER 

Trial Attorney, Tax Division 

Stuart.A.Wexler@usdoj.gov 

LEE F. LANGSTON 

Trial Attorney, Tax Division 

Lee.F.Langston@usdoj.gov 

1000 SW Third Ave, Suite 600 

Portland, OR 97204-2902 

Telephone: (503) 727-1000 

Facsimile: (503) 727-1117 

Attorneys for United States of America 

UNITED STATES DISTRICT COURT 

DISTRICT OF OREGON 

PORTLAND DIVISION 

UNITED STATES OF AMERICA, Case No.: 3:15-CR-00438-JO 

 

Plaintiff,

v. 

WINSTON SHROUT, 

Defendant.

 GOVERNMENT’S OPPOSITION TO 

DEFENDANT’S MOTION TO 

DISMISS FOR VINDICTIVE 

PROSECUTION (DOC. 73) 

 COMES NOW, the United States of America, by and through counsel, BILLY J. 

WILLIAMS, United States Attorney, STUART A. WEXLER, Trial Attorney, United States 

Department of Justice, Tax Division, and LEE F. LANGSTON, Trial Attorney, United States 

Department of Justice, Tax Division, and files this response in opposition to Defendant’s Motion 

to Dismiss for Vindictive Prosecution, filed on March 6, 2017, by Ruben L. Iniguez, Advisory 

Case 3:15-cr-00438-JO Document 74 Filed 03/17/17 Page 1 of 10
GOVERNMENT’S OPPOSITION TO 

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Counsel for pro se Defendant Winston Shrout. (Doc. 73). For reasons stated herein, the 

Defendant’s Motion should be denied. 

I. FACTUAL BACKGROUND 

On December 8, 2015, the Grand Jury returned an indictment charging Defendant 

Winston Shrout with six misdemeanor counts of willful failure to file a tax return, in violation of 

26 U.S.C. § 7203. (Doc. 1). These charges alleged that Defendant had earned income in excess 

of the filing requirement threshold in tax years 2009-2014 and willfully failed to file tax returns 

for those years. 

Defendant made his initial appearance before Magistrate Judge John V. Acosta on 

January 7, 2016. Assistant Federal Public Defender Ruben Iniguez appeared on Defendant’s 

behalf since Defendant had not brought counsel to the appearance. At the hearing, Defendant 

stated his desire to represent himself and indicated that he was interested in pleading guilty to the 

Indictment. (Doc 73-1, pp. 5-6). Based on Defendant’s representations, Judge Acosta set the 

matter for a status hearing in front of Judge Jones on February 3, 2016. (Doc 73-1, p. 25). 

Because Judge Acosta wanted Defendant to have a full opportunity to examine the charges 

against him, and with the consent of Defendant, entry of a plea and determination of counsel was 

deferred until the February 3 hearing. Judge Acosta also stayed discovery until after February 3. 

(Doc. 73-1, p. 27). 

On January 20, 2016, Defendant filed two documents to the record in this case. See Doc. 

9, 10. Then again, on February 3, 2016, and in advance of the status conference before Judge 

Jones, Defendant filed an additional document to the record. See Doc. 13. 

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GOVERNMENT’S OPPOSITION TO 

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FOR VINDICTIVE PROSECUTION (DOC. 73) - 3

On February 3, 2016, the parties appeared before this Court at the status conference. 

Defendant reiterated that he wished to represent himself and this Court conducted a Faretta 

inquiry to determine whether Defendant’s waiver of counsel was knowing and voluntary. After 

initially attempting to “plead guilty to the facts,” Defendant entered a plea of not guilty and the 

case was set for trial. (Doc. 73-2, p. 18). During the Faretta inquiry, the Court informed 

Defendant that the documents filed by Defendant prior to the status hearing, including a lien, an 

invoice, and a liquidation, were “null and void” and “of no legal consequence at all.” (Doc 73-2, 

p. 11). 

On the day of the hearing, counsel for the Government, Stuart Wexler, had a conversation 

with Assistant Federal Public Defendeer Steve Sady, who acted as standby counsel for 

Defendant during the arraignment before this Court.1

 During that conversation, the Government 

informed Mr. Sady that the Government was actively pursuing a superseding indictment against 

Defendant to potentially include multiple counts of 18 U.S.C. § 514. That conversation was 

memorialized by email the same day. (Doc. 73-3). A superseding indictment was returned on 

March 15, 2015, alleging an additional thirteen counts of 18 U.S.C. § 514 against Defendant for 

making, presenting and mailing fictitious obligations. (Doc. 17). 

On March 6, 2017, Defendant filed the instant motion to dismiss the counts added by the 

superseding indictment for vindictive prosecution. (Doc.73). In summary, Defendant alleges 

that the superseding indictment creates an appearance of vindictiveness because the charges 

alleged in the superseding indictment are more severe than the charges in the original indictment 

and there is a reasonable likelihood that the superseding indictment was motivated by 

                                                            

1

 Mr. Sady appeared on behalf of Mr. Iniguez, who was unable to appear at the February 3 arraignment. 

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GOVERNMENT’S OPPOSITION TO 

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Defendant’s decision to choose to represent himself and file pro se pleadings. (Doc. 73, pp. 11-

12).

II. LEGAL STANDARD 

The Due Process Clause of the Fifth Amendment Prohibits a prosecutor from vindictively 

prosecuting a defendant for the defendant’s exercise of a statutory, procedural, or other protected 

right. Blackledge v. Perry, 417 U.S. 21, 27 (1974). A prosecutor violates Due Process when he 

seeks additional charges solely to punish a defendant for exercising a protected right. United 

States v. Kent, 649 F.3d 906, 912 (9th Cir. 2011). The Supreme Court, however, has held that 

“exceptionally clear proof” is required before a court may infer an abuse of prosecutorial 

discretion. McCleskey v. Kemp, 481 U.S. 279, 297 (1987). Because courts ordinarily presume 

that public officials have properly discharged their official duties, a defendant who contends that 

a prosecutor made a charging decision in violation of a defendant’s rights has a demanding 

standard of proof. Nunes v. Ramirez-Palmer, 485 F.3d 432, 441 (9th Cir. 2007). 

To establish a prima facie case for vindictive prosecution a defendant must establish 

either (1) direct evidence of the prosecutor’s punitive motivation or (2) facts and circumstances 

that establish a reasonable likelihood of vindictiveness. Kent, 649 F.3d at 912. A defendant may 

establish prosecutorial vindictiveness by producing direct evidence of the prosecutor’s punitive 

motivation toward him. United States v. Jenkins, 504 F.3d 694, 699 (9th Cir. 2007). 

Alternatively, a defendant is entitled to a presumption of vindictiveness if he can show that 

charges were filed because he exercised a statutory, procedural, or constitutional right in 

circumstances that give rise to an appearance of vindictiveness. Id. “[T]he appearance of 

vindictiveness results only where, as a practical matter, there is a realistic or reasonable 

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GOVERNMENT’S OPPOSITION TO 

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likelihood of prosecutorial conduct that would not have occurred but for hostility or a punitive 

animus towards the [d]efendant because he has exercised his specific legal rights.” Id. at 700. 

Once a presumption of vindictiveness arises, the burden shifts to the prosecution to show 

that “independent reasons or intervening circumstances dispel the appearance of vindictiveness 

and justify its decisions.” United States v. Hooton, 662 F.2d 628, 634 (9th Cir. 1981), cert. 

denied, 445 U.S. 10004 (1982). 

III. ARGUMENT 

a. The Defendant Has Not Established Circumstances that Give Rise to an Appearance 

of Vindictiveness. 

Defendant’s Motion does not lay out sufficient facts to give rise to an appearance of 

vindictiveness. Defendant’s argument is, in essence, post hoc ergo propter hoc: Defendant 

chose to represent himself, plead not guilty, and make pro se filings; subsequently, the 

Government sought a superseding indictment; therefore, the superseding indictment was 

motivated by Defendant’s exercise of those rights. This argument, without more, does not 

establish a prima facie case of vindictive prosecution. 

“Departures from the initial indictment do not raise presumptions of vindictiveness 

except in a rare case.” United States v. Gallegos-Curiel, 681 F.2d 1164, 1170 (9th Cir. 1982). 

“[T]he appearance of vindictiveness results only where, as a practical matter, there is a realistic 

or reasonable likelihood of prosecutorial conduct that would not have occurred but for hostility 

or a punitive animus towards the defendant because he has exercised his specific legal rights.” 

Id. at 1169 (citing United States v. Goodwin, 102 S. Ct. 2485, 2488 (1982)). Courts recognize 

that, especially in the pretrial context, prosecutors should remain free to exercise their discretion 

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to shape charges based on evolving understanding of the evidence. See United States v. Kent, 

649 F.3d 906, 915 (9th Cir. 2011); United States v. Gamez-Orduno, 235 F.3d 453, 463 (9th Cir. 

2000); United States v. Austin, 902 F.2d 743, 745 (9th Cir. 1990). 

 Defendant’s minimal factual showing does not establish a reasonable likelihood that the 

Government sought the superseding indictment to retaliate against Defendant’s exercise of 

protected rights. At the time the Government informed standby counsel that it was considering 

additional charges, the case had barely begun. Defendant had pleaded not guilty, sought to 

represent himself, and filed a small number of pro se motions. 

Defendant’s motion contains no allegations as to why the Government would be 

motivated to seek additional charges to punish Defendant for such conduct. Defendant’s 

decision to represent himself imposes no additional burden on the prosecution nor does the filing 

of motions that are, in the words of the Court, “of no legal consequence at all.” Defendant’s 

motion is devoid of any mention of threats or harassment from the Government designed to 

discourage Defendant from representing himself. Further, if the bringing of additional charges 

after a not guilty plea were sufficient to establish a presumption of vindictiveness, the test would 

lose all meaning and the prosecution would always be required to justify its decision to seek a 

subsequent indictment. Such a requirement ignores the warning in Goodwin that “[t]o presume 

that every case is complete at the time an initial charge is filed . . . is to presume that every 

prosecutor is infallible–an assumption that would ignore the practical restraints imposed by often 

limited prosecutorial resources.” Goodwin, 457 U.S. at 382. 

/ / 

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b. There are Intervening Circumstances that Justify Seeking the Superseding Indictment 

Irrespective of Any Presumption of Vindictiveness. 

In addition to not establishing circumstances that give rise to an appearance of 

vindictiveness, Defendant’s Motion ignores independent reasons and intervening facts and 

circumstances that resulted in the superseding charges. 

First, as Defendant is well aware, the Government has been investigating Defendant for 

potential violations of 18 U.S.C. § 514 since at least June 2012. In that month, Defendant was 

personally served with a search warrant issued by the District of Oregon. The Affidavit in 

Support of that search warrant, completed by IRS Special Agent Casey Hill, establishes probable 

cause that Defendant acted in violation of 18 U.S.C. § 514. Defendant has been in possession of 

a copy of this Affidavit through discovery material provided in this case; the Affidavit is Bates 

stamped MIS-SRW-03-000001, et. seq.2 

Second, the Government’s discovery of an important piece of evidence at around the time 

of the initial indictment prompted the Government to revisit its case against Defendant for 

violations of 18 U.S.C. § 514. On June 9, 2015, Defendant mailed to the United States Treasury 

the fictitious obligation charged in Counts 10 and 13 of the Superseding Indictment. See Doc. 17. 

While Defendant mailed the document well in advance of the initial indictment in this case, the 

prosecution team did not become aware of its existence until approximately December 4, 2015, 

just two business days prior to the indictment date of December 8, 2015. Further, only IRS 

Special Agent Casey Hill was aware of the existence of the document on December 4; the 

prosecutors in this case were not aware of the document until Special Agent Hill showed it to 

them in person on December 7, one day prior to the indictment. Special Agent Hill later 

                                                            

2

 Out of an abundance of caution, the Government is not attaching a copy of the Affidavit to this pleading. A 

copy can be provided to the Court for review, however, upon request. 

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GOVERNMENT’S OPPOSITION TO 

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digitized the document and emailed it to attorneys for the Government on Dec. 10, two days after

the initial indictment in this case.3

 The timing of the receipt and examination of this document 

precluded the Government from including the superseding felony charges in the initial 

indictment. Its receipt, however, prompted the Government to take additional investigative steps 

and ultimately lead, in part, to the charges alleged in the superseding indictment. 

The Government had been in possession of this document and had been refocused on its 

investigation for several weeks prior to February 3 arraignment. By this time, the Government 

believed superseding charges were likely and, out of courtesy to counsel and Defendant, the 

Government alerted counsel to this fact after the arraignment. The Government does not 

specifically recall what subpoenas it was referring to in its conversation and subsequent email 

with counsel, but Government records indicate two subpoenas were issued by the Grand Jury in 

this matter in late-February/early-March, 2015. It is likely that the Government, in its 

conversation with counsel, was either alluding to these subpoenas or to subpoenas that were 

contemplated by not ultimately issued; all other subpoenas had been returned to the Grand Jury 

prior to February 3. Both of the subpoenas that were issued in February/March, however, proved 

unresponsive: neither party possessed any material relevant to the investigation. 

Regardless of whether the subpoenas referenced by the Government in its conversation 

with counsel existed or not, Defendant fails to demonstrate why the Government making this 

assertion is proof of vindictiveness. If anything, it demonstrates the Government was actively 

furthering an investigation into Defendant, in a meaningful and planned manner, which had 

existed since at least 2012. 

                                                            

3

 At counsel’s request, a copy of this email was provided to counsel and Defendant on March 1, 2017, 

several days prior to the filing of the instant Motion to Dismiss. 

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IV. CONCLUSION 

Defendant has not sustained his burden of demonstrating that the Superseding Indictment 

is the result of vindictive prosecution. Defendant has not made the requisite showing of facts 

and circumstances that create a presumption of vindictiveness and, irrespective of Defendant’s 

allegations, there are sufficient intervening facts to justify the seeking of a Superseding 

Indictment. For these reasons, the United States respectfully submits that the Court should deny 

Defendant’s Motion to Dismiss for Vindictive Prosecution. 

Dated this the 17th day of March, 2017. 

 

 Respectfully submitted, 

BILLY J. WILLIAMS 

United States Attorney 

/s/Stuart A. Wexler 

STUART A. WEXLER 

LEE F. LANGSTON 

Trial Attorneys, Tax Division 

(202) 305-3167 

 

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CERTIFICATE OF SERVICE

 I HEREBY CERTIFY that on March 17, 2017, I electronically filed the foregoing with 

the Clerk of the Court using the CM/ECF system, which will send notification of such filing to 

the attorney(s) of record for the defendant. Additionally, a copy of the foregoing was emailed to 

the defendant at milieannjones@gmail.com. 

/s/ Stuart A. Wexler 

Stuart A. Wexler 

Trial Attorney, Tax Division 

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