Opinion ID: 599121
Heading Depth: 2
Heading Rank: 4

Heading: Willfulness in the Tax Code.

Text: 36 In an effort to read the word willfully in a more charitable manner, all three appellants urge that the Court's recent decision in Cheek v. United States, 498 U.S. 192, 111 S.Ct. 604, 112 L.Ed.2d 617 (1991), signifies that federal courts should apply a purely subjective standard to virtually all white-collar crimes that require a mens rea of willfulness as an element of the offense. Such a standard differs from the standard we endorse today because it would allow mistakes born of intentional or reckless ignorance to insulate defendants from criminal liability. Donovan's case illustrates the practical effect of this suggestion: had the trial judge defined willfulness exclusively in terms of a subjective intent to disobey the law, the jury might have exonerated the defendant on the basis of a genuine, albeit reckless, misunderstanding about the law's requirements. 37 We do not think that Cheek can carry the cargo that appellants load upon it. 9 Cheek was a criminal tax case. The Court noted that the term willfully, as used in criminal tax statutes, had long been interpreted as carving out an exception to the traditional rule that ignorance of the law affords no defense to a criminal prosecution. Id. at 200, 111 S.Ct. at 609. Nowhere in Cheek, or in the Court's earlier opinions involving criminal prosecutions under the tax laws, see, e.g., United States v. Pomponio, 429 U.S. 10, 97 S.Ct. 22, 50 L.Ed.2d 12 (1976) (per curiam); United States v. Bishop, 412 U.S. 346, 93 S.Ct. 2008, 36 L.Ed.2d 941 (1973); United States v. Murdock, 290 U.S. 389, 54 S.Ct. 223, 78 L.Ed. 381 (1933), is there any indication that courts should use a purely subjective standard in evaluating state-of-mind defenses under other federal statutes. Rather, the Cheek Court repeatedly qualified its discussion of the point by referring to the special context--criminal tax prosecutions--from whence the discussion proceeded. See, e.g., Cheek, 498 U.S. at 200, 201, 111 S.Ct. at 609, 610. The Court's earlier opinions stressed the same point. See, e.g., Pomponio, 429 U.S. at 12 & n. 3, 97 S.Ct. at 23 & n. 3; Bishop, 412 U.S. at 360-61, 93 S.Ct. at 2017. This repeated qualification makes clear that the Court has crafted a narrow exception, limited to tax cases, in which subjective mistake of law can constitute an absolute defense. 38 Such a conclusion coheres with our long-held understanding of the tax-crime exception. In United States v. Aitken, 755 F.2d 188 (1st Cir.1985), we acknowledged the uniqueness of the tax statutes' mens rea requirements. See id. at 193 (That internal revenue reporting and filing requirements are an enclave apart is recognized.). We read Cheek as confirming and fortifying the stance that we took in Aitken. 39 Moreover, and finally, the rationales supporting a subjective mistake-of-law defense in tax-crime cases do not apply to laws and regulations of the kind at issue here. As the Second Circuit noted, [o]ne of the most esoteric areas of the law is that of federal taxation. It is replete with 'full-grown intricacies,' and it is rare that a 'simple, direct statement of the law can be made without caveat.'  United States v. Regan, 937 F.2d 823, 827 (citation omitted), modified, 946 F.2d 188 (2d Cir.1991), cert. denied, --- U.S. ----, 112 S.Ct. 2273, 119 L.Ed.2d 200 (1992). The federal tax code is not only enormous, detailed, and technical, but also interrelated and highly nuanced. Simply reading the words of the tax code does not always reveal the line between legal and illegal conduct. And for over sixty years, the Supreme Court has held that Congress does not intend to punish those who, in good faith, stray past that line. 40 For these reasons, we join the courts of appeals that have found the Cheek doctrine inapplicable to criminal prosecutions under the currency reporting laws. 10 See, e.g., United States v. Beaumont, 972 F.2d 91, 94-95 (5th Cir.1992); Brown, 954 F.2d at 1569 n. 2; Caming, 968 F.2d at 241; Dashney, 937 F.2d at 539-40. The currency statutes are comparatively few in number, target a much narrower range of conduct, and under the current regulations affect a considerably smaller constituency. The regulatory scheme, overall, is not intricate or even especially subtle. We think these distinctions are dispositive. Accordingly, we reaffirm Aitken and continue to hold that the Cheek exception is restricted to tax crimes. In a prosecution brought under Subchapter II, as we have explained, the criminal intent required for conviction is either the violation of a known legal duty or reckless disregard of the law. Consequently, appellants' requests for the application of a wholly subjective standard were properly denied by Judges Loughlin and Devine.