# U ni te d S ta te s Co ur t of A pp ea ls For the Eig hth Circu it

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No. 1 6- 32 48

__ __ __ __ __ __ __ __ __ __ __ __ __ _ Uni te d S ta te s o f Am eri ca

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff - App el le e

v.

Jo hn Hun te r, Sr.

ll ll ll ll ll ll ll ll ll ll l Defe nd

an t - Ap pe ll an t

__ __ __ __ __ __ App eal fro m

Uni te d S ta te s Di st ric t Co ur t fo r th e Dis tri ct of M in ne so ta - St. Pa ul

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Su bm it te d: Marc h 1 0, 2 01 7 Fil ed : J ul y

10 , 20 17

__ __ __ __ __ __ Befo re LOKEN, MURPHY, and BENTON, Circu it Ju dg es

.

__ __ __ __ __ __ LOKEN, Ci rcu it Ju dg e.

A jury co nv ic te d Jo hn Hun te r, Sr. of on e co un t of co ns pi racy to de frau d th e Uni te d St at es by fi li n g f

a l s e i n co m e ta x ret ur ns in earl y 20 10 ; ni ne co un ts of fil in g fal se cl ai m s fo r pa y m en t of ta x refu nd s be twee n F e b ru ary 20 10 an d Ja nu ary 20 12 ;an d two co un ts o f ag gr av at ed id en ti ty th eft in Ja nu ary 20 12

. The di st ric t co ur t 1

de ni ed Hun te r’s m ot io ns fo r a ne w tri al or jud gm en t of acqu it ta l an d sen te nc ed hi m
to 70 m on th s in pr is on

. Hun te r ap pe al s, arg ui ng th at th e go ve rn m en t fai le d to pr ov e th e si ng le co ns pi racy ch arg ed in th e Seco nd Su pe rs ed in g In di ct men t , an d th at th e di st ric t co ur t ab us ed it s di sc ret io n in ad m it ti ng cert ai n ev id en ce, im pr op erl y im

po se d

se nt en ci ng en ha nc em en ts , a nd erre d in de nyin g hi s m ot io n fo r a ne w t ria l ba se d on in effe ct iv e as si st an ce o f co un se l. We affir m

.

I. The Cons pi ra cy Is su e.

Hun te r’s pr im ary co nt en ti on on ap pe al is th at th e Uni te d St at es fai le d to pr ov e

a si ng le ov erar ch in g co ns pi racy be cau se th e ev id en ce sh owe d m ul ti pl e, se p arat e

“ rimless whee l co ns pi raci es .” W he n rev ie win g th is cl ai m , we vi ew th e ev id en ce i n th e li gh t m os t fav or ab le to th e jury’ s ve rd ic t. See Uni te d St at es v. Ham il to n, 83 7 F.3 d 85 9, 8 63 (8t h C ir. 2 01 6)

.

At tri al
, th e go ve rn m en t in tro du c e d 48 frau du le nt 20 09 in co m e ta x ret ur ns cl ai m in g $2 31 ,49 4 i n re fu nd s, Hu nt er’s o wn retu rn an d th e ret ur ns of 47 “ fil in g coco ns pi rat or s” who were rel at iv es of Hun te r, pe op le who li ve d wit h hi s rel at iv es , an d
pe op le who kn ew Hun te r th ro ug h chu rch

. The IRS pai d refu nd s to ta li ng $1 52 ,18 2.

The 47 frau du le nt ret ur ns fil ed on be ha lf of ot he rs were el ect ro ni cal ly fil ed in earl y 20 10 th ro ug h a ta x pr ep arat io n web si te fro m IP ad dr es se s in Mi nn es ot a an d

no rth wes te rn W is co ns in

. The ret ur ns accu rat el y rep or te d th e in di vi du al ’s na m e, da te of bi rth
, so ci al se cu rit y nu m be r, an d ad dr es s. Man y fal se ly rep or te d wag es be twee n $1 3,0 00 to $1 6,0 00
, in co m e le ve ls th at su pp or te d c l a i ms fo r th e m ax im um earn ed in co m e ta x cred it

. So m e cl ai m ed ta x wit hh ol di ng refu nd s, su pp or te d b y f a k e W- 2

The Hon or ab le Dav id S. Dot y , Uni te d St at es Dis tri ct Ju dg e fo r th e Dis tri ct of 1 Mi nn es ot a.

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o r ms f ro m real em

pl oyers. Oth ers rep or te d fal se refu nd ab le ed uc at io n cred it s a n d fic ti ti ou s wit hh ol di ng fro m ga m bl in g win ni ng s. IRS ag en ts co nt act ed em pl oyers li st ed on th e ret ur ns an d de te rm in ed fic ti ti ou s em pl oym en t an d wag es were rep or te d.

To rece iv e ta x refu nd s, Hun te r or a ta x- pr ep a r e r as so ci at e wou ld ta ke ou t a
pr ep ai d de bi t card in th e fil in g ta xp ay er’s na m e, us in g th at in di vi du al ’s co rrec t so ci al

se cu rit y nu m

be r an d da te of bi rth
, an d en te rin g th e de bi t card ’s ba nk ro ut in g an d

acco un t nu m

be r on th e ta x r e t u r n

. I RS refu nd s were de po si te d in th os e acco un ts

. Hun te r wou ld sh are a po rti on of t he frau d p ro ceed s wi th th e fi le r.

IRS ag en ts su bp oe na ed wire l e s s p ro vi de rs as so ci at ed wit h th e IP ad dr es se s fro m whi ch th e ret ur ns were fil ed

. The m ajor it y were fil ed fro m IP ad dr es se s tra ced

to Hun te r’s ho m e ad dr es se s. Sev en ot he rs were fil ed be twee n Ja nu ary 20 an d Ja nu ary 25
, 20 10 fro m an ad dr es s tra ced to th e Co un try In n an d Su i t e s i n Co tt ag e Gro ve , Mi nn es ot a, whe re Hu nt er h ad ren te d a roo m a few d ay s b efo re.

Two IRS ag en ts qu es ti on ed Hun te r at hi s ho m e in a Ja nu ary 20 13 co ns en su al in te rv ie w. Hun te r ad m it te d th at he pa rti ci pa te d in fil in g fal se ret ur ns

. He sa id th at
ot he rs fro m

Atl an ta an d M ia m i h ad fil ed th e ret ur ns fro m a ho te l o r us in g t he W i-f i

n e t w o r k i n hi s ho m e. Tho ug h ex pr es si ng a de si re to co op erat e, Hun te r refu se d t o
pr ov id e th ei r na m es , saying “ I go t m y se lf in to th is .” W he n a le rte d t ha t h e co ul d b e ch arg ed wit h id en ti ty th eft
, Hun te r in qu ire d ho w th at wou ld be po ss ib le whe n fri en ds ha d g iv en hi m

th ei r id en ti fy in g i nf

or m at io n fo r th e p ur

po se of f il in g fa ls e ret ur ns

.

Four al le ged fil in g co -co ns pi rat or s te st ifi ed fo r th e go ve rn m en t at tri al

. Tek oa h
W hi ts et t, who at te nd ed sc ho ol wit h Hun te r’s da ug ht er, te st ifi ed th at Hun te r pr ep ared he r 20 09 in co m e ta x ret ur n fo r a fee. The ret ur n fal si fie d wag es an d em pl oym en t in fo rm at io n. The IRS pa id a $6 ,77 4 refu nd
, an d Hun te r pa id W hi ts et t $1 ,50 0 in cas h.
W he n W hi ts et t as ke d fo r a co py of he r ta x ret ur n, Hun te r to ld he r th at so m eo ne el se
po ss es se d it
, “ th at he ha d be e n d o i n g t h i s fo r y ears an d th at he ha d wor ke d wit h

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-so m eo ne ou t in W oo db ur y .” Mar i c u s R o s em an te st ifi ed th at Hun te r of fere d to fil e hi s 20 09 ta x ret ur n

. R o s em an ag reed an d pr ov id ed hi s pe rs on al id en ti fic at io n in fo rm at io n. Th e ret ur n frau du le nt ly ob ta in ed a $3 ,31 9 refu nd

. Ro se m an te st ifi ed th at Hun te r on ly ga ve hi m a few hu nd red do ll ars , an d ex pl ai ne d th at he was ke ep in g th e rem ai nd er o f th e ref

un d t o s pl it wit h a few m or e p eo pl e.

Not in g th at al le ge d co ns pi rat or s te st ifi ed at t r i a l t ha t th ey di d no t kn ow each

ot he r, Hun te r arg ue s th e go ve rn m en t’s ev id e n c e “ at be st ” es ta bl is he d m ul ti pl e

co ns pi raci es , rat he r th an th e si ng le co ns pi racy ch arg ed in th e in di ct m en t -- a rimless whe el co ns pi racy in whi ch m ul ti pl e un co nn ect ed “ sp ok es ” de al t in de pe nd en tl y wit h th e sa m e “ hu b” co ns pi rat or , Hun te r. See Kot te ak os v. Unit ed St at es , 32 8 U.S. 7 50
, 75 4- 55 (1 94 6)

. He as se rts , wit ho ut ex pl an at io n, th at he was “ pr ejud ic ed by th e

va ria nc e be twee n th e in di ct m en t an d th e pr oo f

. ” W he th er th e go ve rn m en t’s pr oo f

es ta bl is he d a si ng le or m

ul ti pl e co ns pi raci es is a qu es ti on of fact ; we rev ers e on ly if

“ no reas on ab le jury co ul d ha ve fo un d th e si ng le co ns pi r a c y ch arg ed in th e in di ct m en t

. . . [an d] th is va ria nc e in th e go ve rn m en t’s p r o o f ha s pr ejud ic ed [th e] de fen da nt ’s su bs ta nt ia l rig ht s.” Ham il to n, 83 7 F.3 d at 86 3 (qu ot at io n om it te d)

. “ A si ng le co ns pi racy m ay

ex is t ev en if t he pa rti ci pa nt s an d t he ir a ct iv it ie s ch an ge ov er ti m e, an d ev en i f man y p a rti ci pa nt s are un aware of
, or un in vo lv ed in
, so m e of th e
tra ns act io ns .” Id . (qu ot at io n o m it te d)

.

The f u n da m en ta l fla w in Hun te r’s co nt en ti on is th at it m is rep res en ts th e
go ve rn m en t’s pr oo f at tri al

. The di st ric t co ur t in st ru ct ed th e jury th at it m us t fin d an
ag reem e n t b e t w e e n two or m or e pe rs on s to co m m it th e co ns pi racy ch arg ed in th e in di ct m en t: to “ de frau d th e Uni te d St at es by fil in g fal se , f i c t i t i ou s, or frau du le nt cl ai m s to th e In te rn al Rev en ue Serv ic e.” Hun te r po si ts th at th e g ov ern m en t on ly
p r o ve d m ul ti pl e co ns pi raci es be twee n fil in g co ns pi rat or “ sp ok es ” an d Hun te r, t h e

cen tra l hu b. But , as we ha ve de sc rib ed
, th e ev id en ce perm it te d a reas on ab le jury to fin d, ba se d on Hun te r’s ad m is si on s an d su bs ta nt ia l ci rcu m st an ti al ev id en ce, th at th e
go ve rn m en t pro ve d a si ng le co ns pi racy co ns is ti ng of Hun te r an d ot he r ta x- pr ep arer

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-co ns pi rat or s who en li st ed fil er co ns pi rat or s to carr y ou t th ei r m ul ti pl e frau du le nt
tra ns a c t io ns

. W he th er th e fil ers were in no cen t pa rti ci pa nt s or pa rti al ly in vo lv ed

co ns pi rat or s i s i rrel ev an t. A si ng le co ns pi racy was p ro ve d.

II . Evi dent ia ry Is su es .

In hi s m ot io n fo r a ne w tri al
, Hun te r arg ue d th e di st ric t co ur t erre d in ad m it ti ng in to ev id en ce exh ib it s th at reci te d th e IP add res se s us ed to fil e th e fal se tax ret ur ns , be cau se th e do c u men ts co nt ai ne d he ars ay an d th e go ve rn m en t di d no t pr ov id e

su ffi ci en t fo un da ti on fo r th ei r ad m is si on

. The di st ric t co ur t de ni ed th e m ot io n, no ti ng th at th e IP ad dr es s ev id en ce “ was m ai nt ai ne d by th e IRS as pa rt of it s m as te r fil e, an d th e go ve rn m en t es ta bl is he d it s ad m is si bi li ty as a bu si ne ss reco rd un de r Fed eral Ru le of Evi de nc e 80 3( 6) .” As th es e ex hi bi ts were ad m it te d wit ho ut ob jecti on at tri al
, we

rev ie w th is co nt en ti on for pl ai n e rro r. See Fe d. R. C rim. P. 52 (b ).

Dav id McNu lt y , an in ve st ig a t or an al y st wit h th e IRS Sch em e Dev el op m en t C e n te r, te st ifi ed fro m pe rs on al kn owl ed ge th at an IRS da ta ba se co nt ai ns al l fi l e d in co m e ta x re tu rn s s ub m it te d to th e IRS an d in cl ud es th e IP ad dr es s fro m whi ch an el ect ro ni cal ly fil ed ret ur n or ig in at ed

. McNu lt y te st ifi ed th at he acce ss es an d us es th e IRS da ta ba se as pa rt of hi s in ve st ig at iv e du ti es , th e d a t a b a se is ke pt in th e reg ul ar

co ur se of IRS bu si ne ss , an d th e reco rd s are crea te d as re t u rn s are fil ed

. McNu lt y pe rs on al ly pr ep ared go ve rn m en t Exh ib it s 15 an d 17
, sp read sh eet s of da ta ta ke n fro m th e 20 09 t a x r e t u r ns at is su e whi ch in cl ud ed th e IP ad dr es se s. Exh ib it s 18 th ro ug h 20 are su bs et s of th at sa m e in fo rm at io n. Fo un da ti on fo r ot he r ex hi bi ts co nt ai ni ng IP ad dr es se s was pr ov id ed by a Cen tu ry Lin k co rp or at e se cu rit y wit ne ss

. Adm is si on of th es e ex hi bi ts an d de ni al of Hun te r’s be la te d m ot io n fo r a ne w tri al di d no t co ns ti tu te ab us e of di sc ret io n, le t al on e pl ai n erro r. See Uni te d Stat es v. Voi ce, 62 2 F.3 d 87 0, 87 9 (8 th Cir . 20 10 ), cert . den ie d, 5 62 U.S. 12 06 (20 11 ).

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-II I. Sen tenc in g I ss ues .

Ci ti ng App ren di v. New Je rs ey , 53 0 U.S. 46 6 (2 00 0)
, Hun te r arg ue s th e di st ric t

co ur t erre d in im

po si ng lo ss am ou nt an d ro le -in -th e-o ffen se se nt e n c i n g gu id el in e

en ha nc em en ts be cau s e a jury di d no t m ak e th e un de rlyin g fact fin di ng s. Thi s
arg um en t is fo recl os ed by ci rcu it pr eced en t “ be cau se th e di st ric t co ur t’s fin di ng s di d

no t in crea se th e st at ut or y m ax im um se nt en ce or th e st at ut or y m an da to ry m in i m um

se nt en ce.” Uni te d St at es .v Ms hi hi ri, 81 6 F.3 d 99 7, 10 11 (8 th Ci r.), cert

. de ni ed
, 13 7 S. Ct

. 31 9 (2 01 6)

. Hun te r’s ad di ti on al “ do ub le co un ti ng ” arg um en t is un in te ll ig ib le

.

IV. Mo tio n fo r a New Tri al

.

Fi na ll y , Hun te r arg ue s at len gt h th at th e di st ric t cou rt abu se d it s di sc ret io n in de nyin g hi s m ot io n fo r a ne w t ria l be cau se tri al co un se l’s rep res en ta ti on fel l be lo w

an ob jecti ve st an da rd of r eas on ab le ne ss an d, “ bu t fo r th e cu m ul at iv e eff

ect of th es e

un pr of es si on al erro rs ,” th ere is a reas on ab le pr ob ab il it y of a di ffer en t ou tc om e at tri al

. See St ric kl an d v. W as hi ng to n, 46 6 U.S. 66 8 (1 98 4)

. Thi s is su e was rai se d by Hun te r in a po st -v erd ic t m ot io n fo r ne w tri al
, an d fu rth er arg ue d in a Rep ly Mo ti on fo r New Tria l fil ed by ne wly-app oi nt ed co un se l sh or tl y be fo re se nt en ci ng

. The di st ric t co ur t
tre at ed th is la te r pl ead in g as a se co nd
, writ te n m ot io n fo r ne w tri al
, co ns id ered al l th e in effe ct iv e as si st an ce al le ge d, an d de ni ed th e m ot io n be cau s e H u nt er ha d fai le d to

m ak e a su ffi ci en t sh owi ng of ei th er in effe ct iv e as si st an ce or pr ejud ic e. Afte r care fu l

rev ie w of th e reco rd be fo re th e di st ric t co ur t, we co n cl ud e th ere was no ab us e of di sc ret io n i n d en y in g t he m ot io n fo r a n ew tr ia l o n t hi s g ro un d.

The jud gm en t o f th e d is tri ct co ur t i s af fir m ed

.

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