Opinion ID: 447883
Heading Depth: 2
Heading Rank: 1

Heading: Issues controlled by Koliboski.

Text: 5 The first three issues raised by the defendant relating to jurisdiction, grand jury powers, and the jury instructions, are controlled by our recent decision in United States v. Koliboski, 732 F.2d 1328 (7th Cir.1984). The defendant in Koliboski was indicted on similar charges by the same grand jury that indicted this defendant. As in this case, Koliboski argued that the district court was without subject matter jurisdiction under 18 U.S.C. Sec. 3231. We rejected Koliboski's claim as silly, holding that Title 26 violations are offenses against the laws of the United States and thus are clearly within federal district court jurisdiction under Sec. 3231. 1 Id. at 1329. Thus, the defendant's claim of lack of jurisdiction is similarly dismissed as meritless. 6 Koliboski further resolves Latham's claim that a special grand jury can investigate only organized crime activities. In Koliboski we held that special grand juries are not restricted in their scope to investigating organized crime only. Id. at 1330 (Special grand juries have broad investigative powers. Section 3332(a) directs these grand juries to 'inquire into offenses against the criminal laws of the United States alleged to have been committed within that district.' ... The legislative history confirms the breadth of the general mandate bestowed by this section. These grand juries are not restricted to investigating only organized crime activities.). Thus, based upon our holding in Koliboski the special grand jury which indicted Latham did not exceed its authority. 7 The Koliboski decision also disposes of two of Latham's other claims with regard to improper jury instructions. Latham contends that the district court improperly refused his instruction defining income as distinct from gross income. This instruction was intended to enforce his claim that he in good faith believed that wages are not income for taxation purposes. As we stated in Koliboski, a claim of this nature is without merit. Id. at 1329 n. 1. Latham's wages were and are income; thus, his proposed jury instruction was a misstatement of the law and the district court properly refused to adopt the same in the instructions. 8 Latham argues also that the district court erred in refusing to instruct the jury that in order for a violation of the tax laws to be willful the violation must be the product of a bad purpose. The district court's instruction correctly paraphrased the voluntary, intentional violation of a known legal obligation jury instruction that we approved in Koliboski and United States v. Moore, 627 F.2d 830 (7th Cir.1980). The Supreme Court in United States v. Pomponio, 429 U.S. 10, 97 S.Ct. 22, 50 L.Ed.2d 12 (1976), held this instruction to be the proper definition of willfulness in a prosecution for violations of the Tax Code. No further bad purpose instruction is required. See Koliboski, 732 F.2d at 1331 n. 2. 9 The other jury instructions proffered by the defendant are equally inane. Thus we hold that the district court did not err in refusing the other instruction offered by Latham implying that 26 U.S.C. Sec. 7343 defining person does not include natural persons. 2 Similarly, Latham's instruction which indicated that under 26 U.S.C. Sec. 3401(c) the category of employee does not include privately employed wage earners is a preposterous reading of the statute. It is obvious that within the context of both statutes the word includes is a term of enlargement not of limitation, and the reference to certain entities or categories is not intended to exclude all others. 10 Latham also contends that the court erred in refusing to instruct the jury that an assessment under 26 U.S.C. Sec. 6201 is a legal necessity before an individual can have an income tax liability. Latham's theory is that if there was no assessment, there can be no income tax liability and thus he cannot be found to have filed false W-4 forms since there was no tax liability in the preceding year. But an assessment under Sec. 6201 is an administrative determination that a certain amount is currently due and owing as a tax with consequences somewhat similar to the reduction of a claim to judgment. Cohen v. Gross, 316 F.2d 521, 522-23 (3d Cir.1963). The exempt status requirement of a tax liability in the preceding year does not support Latham's novel and ridiculous theory that there must have been an IRS determination in that year of tax due on income earned when (as here) the taxpayer failed to file a return. Latham cannot place himself in the exempt category in 1981 simply by failing to file a return in 1980. 11 Finally, Latham alleges that by failing to present his theory of defense instructions to the jury the district court committed reversible error. 3 This claim is likewise without merit. The judge's instructions to the jury are to embody a proper statement of the relevant law, not a continuation of counsel's closing argument. Our reading of the record convinces us that the district court's jury instructions were proper as to the relevant defenses. Latham's theory of defense instructions were nothing more than a summary of the evidence he presented at trial relating to his defenses and were properly refused. 12