Court Opinion

ID: 2963553
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Date Created: 2015-09-21 21:11:51.552955+00
Date Added: 2024-06-11T11:42:42.347630
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USCA1 Opinion

	

                            UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT

                              _________________________

          No. 94-2123

                              UNITED STATES OF AMERICA,

                                      Appellant,

                                          v.

                       ANTHONY G. OLBRES and SHIRLEY A. OLBRES,

                                Defendants, Appellees.

                              __________________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                          FOR THE DISTRICT OF NEW HAMPSHIRE

                   [Hon. Steven J. McAuliffe, U.S. District Judge]
                                              ___________________

                              __________________________

                                        Before

                                Selya, Circuit Judge,
                                       _____________

                            Coffin, Senior Circuit Judge,
                                    ____________________

                               and Cyr, Circuit Judge.
                                        _____________

                              _________________________

               Karen Quesnel,  Attorney, Tax Division, United  States Dep't
               _____________
          of  Justice, with  whom  Loretta C.  Argrett, Assistant  Attorney
                                   ___________________
          General,  Robert E.  Lindsay and  Alan Hechtkopf,  Attorneys, Tax
                    __________________      ______________
          Division, and  Paul M. Gagnon,  United States  Attorney, were  on
                         ______________
          brief, for the United States.
               Terry Philip  Segal, with whom Matthew  H. Feinberg, Matthew
               ___________________            ____________________  _______
          A. Kamholtz,  Segal &  Feinberg, Steven  M. Gordon,  and Shaheen,
          ___________   _________________  _________________       ________
          Cappiello, Stein & Gordon were on joint brief, for appellees.
          _________________________

                              __________________________

                                    July 26, 1995

                             __________________________ 
                                           

                    SELYA, Circuit  Judge.   In  1989, an  employee of  the
                    SELYA, Circuit  Judge.
                           ______________

          Internal Revenue Service (IRS) noticed a Rolls Royce belonging to

          the  defendants, Anthony  and  Shirley Olbres,  parked outside  a

          restaurant  in Exeter, New Hampshire.  The presence of so opulent

          a vehicle in so  bucolic a setting piqued the  taxman's interest.

          He initiated  an investigation  that led,  in  succession, to  an

          audit,  an indictment, a trial,  and a conviction  for income tax

          evasion pursuant to  a jury  verdict.1  The  district court  then

          trumped the jury's verdict,  granting the defendants' motions for

          judgments of acquittal.  See United States v. Olbres, Cr. No. 93-
                                   ___ ______ ______    ______

          27-1-2-M (D.N.H. Sept. 30,  1994) (D. Ct. Op.).2   The government

          appeals.  We reinstate the convictions.

          I.  BACKGROUND
          I.  BACKGROUND

                    We    start    by    relating   certain    (essentially

          uncontradicted) facts that serve  to put the appeal into  initial

          perspective.   In 1974, the Olbreses   he an industrial designer,

          she a schoolteacher destined to become a self-taught bookkeeper  

          launched a proprietorship, Design Consultants (DC),  to conceive,

          construct, and erect exhibit  booths for trade shows.   At first,
                              
          ____________________

               1The statute of conviction provides in relevant part:

                    Any  person  who  willfully  attempts  in any
                    manner to evade or  defeat any tax imposed by
                    [the  Internal Revenue  Code] or  the payment
                    thereof shall, in addition to other penalties
                    provided by law, be guilty of a felony . . .

          26 U.S.C.   7201 (1988).

               2Although  the   district  court's  thoughtful   opinion  is
          unpublished, the  interested  reader can  locate  it at  1994  WL
          543520.

                                          2

          the proprietors comprised  the entire work  force.  The  business

          grew  steadily,  and  by 1987  DC  employed  23  persons and  had

          revenues in excess of $1,900,000.  Despite the  phenomenal growth

          of the business,  Shirley Olbres continued  to handle the  books,

          toiling  part-time,  mostly  at  home.    Her  working  materials

          consisted of an invoice log (in which she recorded bills sent and

          payments  received), and three journals reflecting, respectively,

          cash receipts, cash disbursements, and petty cash.

                    Beginning in 1976, the defendants retained the services

          of an accountant,  Wilson Dennett.   Dennett compiled income  tax

          returns and financial statements, but did not perform bookkeeping

          or kindred services.  He prepared the tax returns in reliance  on

          information  supplied by  the defendants.   For  the tax  year at

          issue on this appeal   1987   Shirley Olbres drafted a summary of

          the defendants' books and records for Dennett's use.  She and her

          husband  then met with Dennett to answer questions.  When Dennett

          completed the  return,  the defendants  came  to his  office  and

          signed it.

                    The  defendants maintained various bank accounts during

          1987.  These  included business checking and  savings accounts at

          Indian  Head Bank  (IHB).   Defendants  deposited  most of  their

          business  receipts  into  the   business  checking  account,  but

          occasionally  deposited  business  receipts  into   the  business

          savings  account.   While    Shirley  Olbres  recorded  all  sums

          deposited into the business checking account in the cash receipts

          journal,  she did  not make  comparable entries  showing deposits

                                          3

          made  to  the business  savings account.    During the  same time

          frame,  the defendants  also  maintained payroll  and petty  cash

          accounts at a  second bank,  and a rent-receipts  account in  the

          name of Seabrook Properties at yet a third financial institution.

                    The IRS started its investigation into the  defendants'

          tax  returns in  1989.   Revenue Agent  Leonard Kaply  pulled the

          laboring oar.  He determined, inter alia, that the defendants had
                                        _____ ____

          substantially underreported  their income on their  joint federal

          income tax returns  for the years  1986 through 1988.   For 1987,

          Kaply's audit indicated that the defendants had failed to  report

          nearly  $750,000 in  income  from three  sources:   (1)  business

          receipts deposited directly into the business savings account and

          not recorded in  the cash  receipts journal; (2)  rebates from  a

          transportation company that had contracted with DC  to move trade

          show booths from  place to  place;3 and (3)  certain income  from

          rental property.  In the course of the audit, the defendants gave

          Agent  Kaply  the cash  receipts  journal,  but  claimed to  have

          misplaced  the invoice  log  and the  passbook  for the  business

          savings  account (either of which would have revealed much of the

          unreported income).  It was only when the IRS issued a summons to

          IHB that  it discovered the  business savings  account, with  its

          trove of unreported funds.

                    The IRS concluded that  the defendants willfully failed

                              
          ____________________

               3For  no easily  explicable reason,  these rebates  had been
          deposited into the Seabrook  Properties account, omitted from the
          summary  prepared  by Mrs.  Olbres  for  Dennett's  use, and  not
          mentioned in the defendants' ensuing dialogue with Dennett.

                                          4

          to  report substantial amounts of income on their 1986, 1987, and

          1988 federal tax returns ($150,954 in 1986, $748,991 in 1987, and

          $175,432 in  1988).  The defendants  conceded the underreporting,

          but denied  criminal responsibility, saying that  they lacked any

          intent  to defraud.4  A federal grand jury returned a three-count

          indictment charging the  defendants with willfully  attempting to

          evade income tax for those three years.  The case was tried  to a

          jury.  The defendants moved for judgments of acquittal at the end

          of the government's case,  and again when both sides  had rested.

          See Fed. R. Crim. P. 29(a).  The district court  denied the first
          ___

          set of motions and reserved decision on the second set.  See Fed.
                                                                   ___

          R. Crim. P. 29(b).  On January 24, 1994, the jury reached a split

          decision:   it found the defendants not  guilty on count 1 (1986)

          and count 3 (1988), but guilty on count 2 (1987).

                    After  a gestation  period of  nearly nine  months, the

          district court, acting  in pursuance  of the  earlier Rule  29(b)

          reservation,  granted  the defendants'  motions for  judgments of

          acquittal  on count  2.   The government  then filed  this timely

          appeal.

          II.  ANALYSIS
          II.  ANALYSIS

                    Our  analysis of  this case  is partitioned  into three

          segments.  First,  we limn the  standard of  review.  Second,  we

          examine  the  elements  of  the  offense  of conviction  and  the

          sufficiency  of the evidence.  Third, we  explain why we find the
                              
          ____________________

               4The defendants placed much of the onus on their accountant,
          Dennett,  who died prior  to the trial.   For the  most part, his
          knowledge of the facts died with him. 

                                          5

          district court's analysis unpersuasive.

                               A.  Standard of Review.
                               A.  Standard of Review.
                                   __________________

                    Expressing the standard for  judicial review of a claim

          of   evidentiary  insufficiency   in   a  criminal   case  is   a

          straightforward exercise.   If  the evidence presented,  taken in

          the light most flattering  to the prosecution, together with  all

          reasonable inferences favorable to it, permits a rational jury to

          find each  essential  element  of  the  crime  charged  beyond  a

          reasonable doubt, then  the evidence is legally  sufficient.  See
                                                                        ___

          Jackson v. Virginia, 443  U.S. 307, 319 (1979); United  States v.
          _______    ________                             ______________

          Gifford,  17  F.3d 462,  467 (1st  Cir.  1994); United  States v.
          _______                                         ______________

          Castro-Lara, 970 F.2d 976, 979 (1st Cir. 1992), cert. denied, 113
          ___________                                     _____ ______

          S. Ct. 2935 (1993).   In evaluating sufficiency, both  direct and

          circumstantial evidence  are accorded weight.   See, e.g., United
                                                          ___  ____  ______

          States  v. O'Brien, 14 F.3d 703, 706 (1st Cir. 1994).  So long as
          ______     _______

          the  evidence,  taken  as   a  whole,  warrants  a   judgment  of

          conviction, "it need not rule out other hypotheses more congenial

          to a finding of innocence."  Gifford, 17 F.3d at 467.
                                       _______

                    When, as now, a criminal defendant mounts a sufficiency

          challenge, all the evidence, direct  and circumstantial, is to be

          viewed from the government's  coign of vantage.  Thus,  the trial

          judge  must resolve  all  evidentiary  conflicts and  credibility

          questions  in the  prosecution's favor;  and, moreover,  as among

          competing  inferences, two  or more  of which are  plausible, the

          judge must choose the inference that  best fits the prosecution's

          theory of guilt.  See  United States v. Taylor, 54 F.3d  967, 974
                            ___  _____________    ______

                                          6

          (1st Cir. 1995);  United States  v. Rothrock, 806  F.2d 318,  320
                            _____________     ________

          (1st Cir. 1986).

                    The  granting of a motion for  judgment of acquittal is

          subject to de novo review.  See United States v. Kirvan, 997 F.2d
                     __ ____          ___ _____________    ______

          963, 967 (1st  Cir. 1993).  Like the trial  court, "we scrutinize

          the  evidence in  the  light most  compatible  with the  verdict,

          resolve all credibility disputes in the verdict's favor, and then

          reach a judgment about  whether a rational jury could  find guilt

          beyond a reasonable doubt."  Taylor, 54 F.3d at 974.
                                       ______

                           B.  Sufficiency of the Evidence.
                           B.  Sufficiency of the Evidence.
                               ___________________________

                    In   this  instance,  our   assignment  is  simplified.

          Because the defendants do  not dispute that they signed  the 1987

          tax return  and that they substantially  understated their income

          in  the process,  the question  of guilt  reduces to  whether the

          underreporting   occurred   willfully,   that  is,   whether   it

          constituted "a voluntary, intentional  violation of a known legal

          duty," United States  v. Pomponio,  429 U.S. 10,  12 (1976)  (per
                 _____________     ________

          curiam) (citations  omitted).  The  trial focused on  this narrow

          issue.  The government contended that the defendants deliberately

          understated their 1987 income, while the defendants   who claimed

          to have signed  the return  without reading it    contended  that

          they  were guilty only of  inadvertence, aggravated by the hiring

          of a maladroit accountant.

                    In a  tax evasion case  in which the  defendants assert

          that  blind reliance  on their  accountant, not  criminal intent,

          caused an underreporting,  the critical datum is not  whether the

                                          7

          defendants  ordered the  accountant to  falsify the  return, but,

          rather, whether the  defendants knew when they  signed the return

          that it understated their income.  See Rothrock, 806 F.2d at 321.
                                             ___ ________

          So here:   if the evidence  introduced at trial, taken  in a pro-
                                                           ________________

          government light, permitted the jury to infer that the defendants
          ________________

          (a) were aware of the contents of their return, and (b) knew that

          their  reportable  income   significantly  exceeded  the   income

          reflected therein,  then the  jury lawfully could  find that  the

          defendants  acted willfully,  and,  hence, violated  26 U.S.C.   

          7201.   See,  e.g., United  States v.  Gaines, 690 F.2d  849, 855
                  ___   ____  ______________     ______

          (11th Cir. 1982).   We turn  to this  two-part inquiry, and  then

          buttress the results with additional evidence of willfulness.

                    1.   Knowledge of the Return's Contents.  This facet of
                    1.   Knowledge of the Return's Contents.
                         __________________________________

          the inquiry  need not occupy us for long.  A jury may permissibly

          infer  that a taxpayer read his return and knew its contents from

          the bare fact that he signed it.  See United States v. Drape, 668
                                            ___ _____________    _____

          F.2d 22,  26  (1st  Cir.  1982)  (holding  that  the  defendant's

          signature  on  his  return  sufficed to  establish  knowledge  of

          incorrect contents); United States v. Romanow, 505 F.2d 813,  814
                               _____________    _______

          (1st Cir.  1974) (dismissing taxpayer's  denial that he  had read

          tax  form,  and stating  that  "it  is clear  that  a jury  could

          disbelieve  him and conclude from  nothing more than the presence

          of  his uncontested  signature  that he  had  in fact  read"  the

          document).

                    Here,  moreover,   the   jury  had   before  it   other

          circumstantial evidence  indicating that the  defendants knew the

                                          8

          contents of their return.   Dennett's wife, who worked  with him,

          testified that when Dennett prepared  a tax return for signature,

          the  return was bundled  into a  packet with  a cover  sheet that

          summarized its contents.   The bottom portion of the  cover sheet

          contained  the  bill  for  the  tax  preparation services.    The

          defendants testified that it  was their habit to go  to Dennett's

          office, sign  the completed return, and  pay the bill.   The jury

          could  reasonably  infer   that,  in  order  to  have   paid  the

          accountant's bill, the  defendants must have read  the portion of

          the cover sheet that detailed the return's contents.

                    2.    Knowledge  of   the  Understatement.    The  most
                    2.    Knowledge  of   the  Understatement.
                          ___________________________________

          compelling  proof  that  the  defendants  knew  that  the  figure

          reported on  their 1987  return  substantially understated  their

          true  income is the product of simple arithmetic.  Tama Mitchell,

          a government  witness, analyzed  the defendants' 1987  return and

          found that the disposable  funds available to them in  that year,

          based  on  the  information  contained in  the  return,  totalled

          $24,695.   Mitchell  further testified  that the  defendants made

          expenditures  of more  than $620,656  during the  year.5   In the

          same period, their overall savings  increased by $334,003.  After

          subtracting net  deposits of  loan proceeds, Mitchell's  analysis

          demonstrated  that  the  defendants'  combined  expenditures  and

                              
          ____________________

               5Mitchell's computations did not include all the defendants'
          annual expenditures,  but established a baseline by concentrating
          on  major  cash purchases  during the  year,  e.g., an  outlay of
                                                        ____
          $158,000 in June to purchase a Rolls Royce  Corniche convertible;
          an outlay  of $32,450 in August to purchase a Range Rover; and an
          infusion of roughly $140,000 to a brokerage account.

                                          9

          accretions to  savings in  1987  exceeded the  cash available  to

          them, according to their tax return, by $580,989.

                    To be sure, the  evidence pertaining to the defendants'

          lavish spending is circumstantial  and suggestive, not direct and

          irrefutable.      Yet,   the   arithmetic   furnishes   a  sturdy

          infrastructure  capable of supporting a reasonable inference that

          the  defendants  must  have been  aware  that  their 1987  return

          substantially underreported  their income.  See  O'Brien, 14 F.3d
                                                      ___  _______

          at 706-07 (holding  that, despite an absence  of direct evidence,

          circumstantial  evidence adequately supported jury's inference of

          guilty knowledge  in fraud  case); Castro-Lara,  970 F.2d  at 981
                                             ___________

          (explaining that  "circumstantial evidence, in and  of itself, is

          often  enough to ground a  conviction"); United States v. Hurley,
                                                   _____________    ______

          957 F.2d 1, 4 (1st  Cir.) (stating that, in proving tax  evasion,

          "the  government [does] not need  to show direct  evidence of tax

          motivation" so long as  the jury has a  sufficient circumstantial

          basis for  inferring willfulness),  cert. denied, 113  S. Ct.  60
                                              _____ ______

          (1992).   Even if one were to accept the defendants' self-serving

          hypothesis that the accountant's incompetence sparked the  myriad

          misstatements  embedded  in  the  return, the  jury  could  still

          reasonably  infer that,  when the  defendants signed  the return,

          they must have  gained an  awareness that the  numbers could  not

          possibly be accurate.  See Gaines, 690 F.2d at 855 (holding  that
                                 ___ ______

          glaring  inaccuracies  in   figures  can  support  a   reasonable

          inference  of knowledge); see also Drape, 668 F.2d at 26 ("Intent
                                    ___ ____ _____

          may  be established  where a  taxpayer  `chooses to  keep himself

                                          10

          uninformed  as  to   the  full  extent   that  [the  return]   is

          insufficient.'") (quoting Katz  v. United States, 321  F.2d 7, 10
                                    ____     _____________

          (1st Cir.), cert. denied, 375 U.S. 903 (1963)).
                      _____ ______

                    The  proposition that the  defendants knew their return

          understated their  income derives support from  other evidence as

          well.    For  example,  during  1986,  Anthony  Olbres  (who  had

          unrestricted access  to DC's  books and records)  provided fiscal

          and marketing  information to  Dennett so that  the latter  could

          prepare a  financial statement  in connection with  a prospective

          sale of the  business.  When  completed, the financial  statement

          projected  1987  revenues  in  the amount  of  $1,976,000.    The

          projection proved  to  be  prophetic    DC's  actual  1987  gross

          receipts totalled $2,014,059    but the defendants reported gross

          receipts  on  the  1987  tax  return  in  a  far  smaller  amount

          ($1,265,069).   Based on this  progression of events,  a rational

          jury  could plausibly  infer that  Anthony Olbres  had sufficient

          knowledge  of  DC's  financial  matters  to  recognize  the  huge

          discrepancy between projected revenues and reported revenues, and

          to appreciate the significance  of the gap.6  Likewise,  the jury

                              
          ____________________

               6The   district  court   suggested   that  Anthony   Olbres'
          participation in  the preparation of the  1987 projections tended
          to be  exculpatory rather  than incriminatory, because  it showed
          that the defendants reposed great confidence in their accountant.
          See  D.  Ct. Op.  at  31.    Though  such  an  inference  may  be
          ___
          permissible, it is not  compelled; and, given the method  of Rule
          29, it is the  jury's choice between alternative inferences,  not
          the trial judge's  choice, that  must control.   See O'Brien,  14
                                                           ___ _______
          F.3d  at  707 (warning  that judges  must  not "usurp  the jury's
          province"  of choosing  between  alternative inferences);  United
                                                                     ______
          States  v. Guerrero-Guerrero, 776 F.2d 1071, 1075 (1st Cir. 1985)
          ______     _________________
          (similar), cert. denied, 475 U.S. 1029 (1986).
                     _____ ______

                                          11

          could infer from Shirley Olbres' position as DC's bookkeeper that

          she,  too, must  have  recognized the  massive understatement  of

          income.

                    3.  Other Evidence  of Willfulness.  In this  case, the
                    3.  Other Evidence  of Willfulness.
                        ______________________________

          jury  heard other  evidence capable  of supporting  a permissible

          inference that the  defendants acted willfully  in underreporting

          their income.  For one thing, the defendants themselves from time

          to time  bypassed their  business checking account  and deposited

          substantial amounts of money (including approximately $145,000 in

          payments  from  a  single  customer,   Digital  Equipment  Corp.)

          directly into  their business  savings account.   They  knew that

          these payments constituted income, yet they neither recorded them

          in the cash receipts  journal nor reported them on their 1987 tax

          return.  To  make matters  worse, the two  source materials  that

          most  easily could  have identified  the unreported income    the

          invoice log and the  passbook for the business savings  account  

          were    withheld   from   the    defendants'   accountant;   and,

          coincidentally,   the   same   source    materials   conveniently

          disappeared  during  the  IRS   audit.7    While  the  defendants

          maintained other  books and records  from which the  existence of

          these funds could perhaps be gleaned, see D. Ct. Op. at 31, it is
                                                ___

          readily  evident that  a jury  plausibly could  infer  from these

          facts that  the defendants  clumsily attempted to  conceal income
                              
          ____________________

               7Joyce  Wildes, a  Dennett employee  assigned to  review the
          defendants'  taxes,  testified that  she  was  not provided  with
          either  the log or the  passbook, and Agent  Kaply discovered the
          existence  of  the business  savings  account  only by  obtaining
          information directly from IHB.

                                          12

          from both their tax preparer and their government.

                    Of course, the defendants'  counter-argument   that the

          evidence indicates  nothing more  than that they  were remarkably

          slipshod  in  their  business  practices     is  also  plausible.

          Withal, the option to choose between these inferences belonged to

          the jury,  not the judge, see United States v. Guerrero-Guerrero,
                                    ___ _____________    _________________

          776 F.2d  1071, 1075 (1st Cir. 1985), cert. denied, 475 U.S. 1029
                                                _____ ______

          (1986),   and  the  jury  had  a  perfect  right  to  reject  the

          defendants' counter-argument and draw  the inference urged by the

          government.   See  O'Brien,  14 F.3d  at  707; United  States  v.
                        ___  _______                     ______________

          Quejada-Zurique, 708 F.2d 857, 859  (1st Cir.), cert. denied, 464
          _______________                                 _____ ______

          U.S. 855 (1983).  After all, "if the evidence can be construed in

          various reasonable  alternatives, the jury is  entitled to freely

          choose from among them."   United States v. Smith, 680 F.2d  255,
                                     _____________    _____

          259 (1st Cir. 1982), cert. denied, 459 U.S. 1110 (1983).
                               _____ ______

                    The evidence  anent the defendants' income  from rental

          property  also bolstered  the inference  of willfulness.   During

          1987, the defendants owned various  properties and rented them to

          tenants.   In 1987, Johnson Matthey Catalog  Company (J/M) rented

          space from the defendants  in Seabrook, New Hampshire, at  a rate

          of  $48,000 per  annum.   J/M  sent a  $4,000 rent  check to  the

          defendants' home every month.  Shirley Olbres deposited each rent

          check,  when  received,  into the  Seabrook  Properties  account.

          Although J/M  paid the full  $48,000 during 1987,  the defendants

          informed Dennett that  they had garnered  only $30,000 in  rental

          income  from  all their  real estate.    Thus, their  1987 return

                                          13

          failed to include $18,000 from the avails of the J/M tenancy, and

          also failed to  include $3,890  in rental income  referable to  a

          property known as "the barn."  It is beyond serious question that

          the  defendants'  action in  pegging  the J/M  lease  proceeds at

          $30,000  in the summary  they gave  to their  accountant, coupled

          with their failure  to list  any rental income  referable to  the
                                       ___

          barn, could ground the requisite inference of criminal intent.

                    We think,  too, that the defendants'  failure to report

          sums  received   as  rebates   from  Mayflower   Transit  Company

          (Mayflower) gives rise to a founded inference of willfulness.  DC

          retained  Mayflower to  ferry exhibit  booths to  and from  trade

          shows.    The  contract   between  the  parties  stipulated  that

          Mayflower  would  furnish   transportation  services  to   DC  at

          customary  tariff  rates,  but  then  remit  20% of  the  amounts

          actually  paid.  The rebate would be calculated monthly, based on

          payments from DC  to Mayflower.   Pursuant  to this  arrangement,

          Mayflower  remitted $96,671 in 1987, but, for some reason, failed

          to  issue a 1099 form memorializing the payments.  The defendants

          did  not report any of this money  as income on their 1987 return

          (despite the fact that  they deducted 100% of the  tariff charges

          that they paid in the first instance).

                    Shirley  Olbres deposited  each  of  the eleven  rebate

          checks that DC received  from Mayflower during the year  into the

          Seabrook  Properties  account even  though  that  account had  no

          direct  connection  with  DC or  its  business.    At trial,  she

          testified  that she  did not  know  that the  rebates constituted

                                          14

          income.  Her husband, however, admitted that he was aware of  the

          rebates' taxable character.   We believe that, on this  record, a

          rational jury  could infer that  the concealment  of the  rebates

          resulted not from  ignorance or inadvertence but from a conscious

          decision  on the defendants'  part to take  criminal advantage of

          Mayflower's failure to issue the required 1099 form.

                    4.    Recapitulation.   To  sum  up,  the record,  read
                    4.    Recapitulation.
                          ______________

          favorably to the  verdict, supports the following findings:   (1)

          the  defendants signed  the 1987  tax return;  (2) they  knew the

          contents of the return at the time they signed it,  and they knew

          that it significantly understated  their taxable income; (3) they

          knew their  business had made  substantially more money  than the

          return  reflected; (4) they had  received revenues during the tax

          year  which they knew were taxable, such as business receipts and

          transportation rebates, yet they neither deposited those revenues

          in the business  checking account nor  recorded their receipt  in

          the  usual manner, but,  instead, diverted the  revenues to other

          bank accounts;  (5) they deliberately understated  the amounts of

          rental income received when transmitting data to their accountant

          preliminary to the accountant's  preparation of their tax return;

          and (6) they withheld materials from the accountant  (and, later,

          from  the IRS auditor) that  would have pointed  to the existence

          and  extent  of  the  undeclared  income.    Notwithstanding  the

          defendants' denials and  regardless of  the exculpatory  evidence

          that lurked in the record, these findings enabled a rational jury

          to  conclude, beyond a reasonable doubt, that the defendants were

                                          15

          guilty of income tax evasion for the year 1987.

                            C.  The Judgment of Acquittal.
                            C.  The Judgment of Acquittal.
                                _________________________

                    The district  court, steadfast in its  desire to ensure

          the  integrity  of the  reasonable  doubt  standard, undertook  a

          painstakingly  thorough examination  of  the record.   The  court

          conceded that  the government's  case was not  "unpersuasive," D.

          Ct.  Op.  at  35,  that  a  jury  "could  rationally  reach"  the
                                                    __________

          conclusion that the defendants willfully attempted to defraud the

          government in respect to their 1987 taxes, id., and that,  if the
                                                     ___

          court  were to determine the existence of willfulness by means of

          a preponderance test, it  would find for the government,  see id.
                                                                    ___ ___

          at 37.  Nevertheless,  the court entered judgment notwithstanding

          the  verdict  on  the ground  that  the  proof did  not  permit a

          finding, beyond a reasonable doubt, that the defendants willfully

          filed a  false tax return.   To the court's way  of thinking, the

          defendants   had   articulated   a   "hypothesis   of   innocence

          (negligence, incompetence, inattention,  and reasonable  reliance

          on  the family's  long-time certified  public accountant)  . .  .

          [that was]  sufficiently reasonable and  sufficiently strong  and

          sufficiently credible that  a rational trier  of fact . .  . must

          necessarily entertain  a reasonable doubt about defendants' guilt

          . . . ."  Id. at 37-38.
                    ___

                    Our independent review of  the record convinces us that

          the court,  while giving lip service to the "viewpoint" principle

          (which holds that the evidence must be viewed, for the purpose of

          an  acquittal  motion,  in  the  light  most  flattering  to  the

                                          16

          government), subverted  the principle by isolating  each piece of

          evidence and  determining whether that evidence,  standing alone,

          gave  rise to a powerful enough inference of willfulness to allay

          any  reasonable  doubt about  the  defendants'  guilt.    In  the

          bargain, the  court appears  to have misunderstood  the interplay

          between  the  viewpoint   principle  and  the   reasonable  doubt

          standard.

                    The   lower  court's  handling   of  the  rent-receipts

          evidence illustrates our concerns.   In discussing this evidence,

          the  court   acknowledged  that  an  inference   adverse  to  the

          defendants  could rationally  be drawn,  but concluded  that this

          inference was  not "of  sufficient persuasive value  to establish

          [the  defendants']  knowing  intent  to  evade  taxes,  beyond  a

          reasonable  doubt."    D.  Ct.  Op. at  33.    But  few,  if any,

          circumstantial   evidence  cases   can  survive   this  sort   of

          balkanization.  For  purposes of Rule  29, a broader  perspective

          must  be employed to gauge  the prosecution's mettle.   Under the

          viewpoint principle, a jury charged with determining an accused's

          guilt  or innocence  is entitled  to consider  the evidence  as a

          seamless whole.  Jurors are "not required to examine the evidence

          in isolation, for `individual pieces of evidence, insufficient in

          themselves to prove a point, may in cumulation prove it.  The sum

          of an  evidentiary  presentation may  well  be greater  than  its

          constituent parts.'"  United  States v. Ortiz, 966 F.2d  707, 711
                                ______________    _____

          (1st Cir. 1992)  (quoting Bourjaily  v. United  States, 483  U.S.
                                    _________     ______________

          171, 179-80 (1987)), cert. denied, 113 S. Ct. 1005 (1993).  Here,
                               _____ ______

                                          17

          though no one piece of evidence laid bare the defendants' intent,

          the aggregate evidence, taken  most hospitably to the prosecution

          (as the viewpoint principle demands), was equal to the task.

                    The  lower  court's  treatment  of  the evidence  anent

          transportation rebates illustrates another  (related) shortcoming

          in the court's inchmeal approach to evidentiary sufficiency:  the

          court  not only  took each  piece of  evidence in  isolation, but

          weighed  the several  possible  inferences  associated with  each

          piece,  and   chose  between  them.     Thus,  while   the  judge

          acknowledged that the jury could rationally infer criminal intent

          in connection with Shirley Olbres' handling of the transportation

          rebates,8  he posited  that  Mrs. Olbres,  as an  "unschooled lay

          person," might  well have  misconstrued the rebates  as something

          other  than income.   D.  Ct. Op.  at 34.   By umpiring  the duel

          between two  competing inferences and declaring the winner on the

          basis  of which inference appeared  more robust in  his eyes, the

          judge invaded the jury's province.

                    On a motion for judgment of acquittal   unlike, say, on

          a motion for  a new trial9   it  is for the jury, not  the court,

          to  choose  between  conflicting  inferences.   In  Jackson,  the
                                                              _______

          Supreme  Court  stated  that a  court  "faced  with  a record  of

          historical   facts  that  supports  conflicting  inferences  must
                              
          ____________________

               8The district court conceded that the evidence could sustain
          an inference  that Shirley  Olbres knew  the  rebate checks  were
          taxable  income,  but  attempted  to hide  them,  thereby  taking
          advantage of Mayflower's  failure to report  the payments to  the
          IRS on the required form.  See D. Ct. Op. at 34.
                                     ___

               9The defendants did not move for a new trial in this case.

                                          18

          presume   even if it does not affirmatively appear in the  record

            that  the trier of fact resolved any such conflicts in favor of

          the prosecution, and must defer to that resolution."  443 U.S. at

          326.  Under this  directive, the judge's failure to  defer to the

          permissible inference of willfulness  arising out of, inter alia,
                                                                _____ ____

          the defendants'  failure to report the  rebate checks constitutes

          error.

                    There is  still another aspect of  the district court's

          methodology  that  bears  correction.     In  finding  the  proof

          insufficient to  convict, the  court  cited, and  relied upon,  a

          statement to the  effect "that  if a hypothesis  of innocence  is

          sufficiently   reasonable  and   sufficiently   strong,  then   a

          reasonable trier of fact  must necessarily entertain a reasonable
                                    ____

          doubt."  United States v. Bell, 678 F.2d 547, 550 (5th Cir. 1982)
                   _____________    ____

          (en  banc)  (Anderson,  J., concurring)  (internal  citation  and

          quotation marks omitted),  aff'd on other  grounds, 462 U.S.  356
                                     _______________________

          (1983).  Even  apart from a citation error,10  this stripped-down

          formulation,  without more, comprises  a misleading  statement of

          the  law.   Its principal  vice is  that it  is incomplete.   The

          quoted  text fails  to reflect  a core  element of  the viewpoint

          principle:  the necessity of drawing inferences hospitable to the

          government's theory of  the case before  judging the strength  of
                                           ______

          any proffered hypothesis of innocence.  We explain briefly.

                    In  analyzing a  motion  for judgment  of acquittal,  a

                              
          ____________________

               10The district court incorrectly attributed this language to
          the Bell majority.  See D. Ct. Op. at 20.  
              ____            ___

                                          19

          court is obliged  to take, and then to  scrutinize, a snapshot of

          the case   but, as  we have made clear on other  occasions,11 the

          snapshot only can be taken after focusing the  lens of inquiry at

          an angle  favorable  to  the prosecution.    The  district  court

          neglected this focus.   It took the snapshot head-on  (as a judge

          would do if  presiding over  a bench trial).   Consequently,  the

          court acknowledged that inferences of willfulness could plausibly

          be drawn from  much of  the evidence, but,  instead of  crediting

          those inferences and then confronting the question of evidentiary

          sufficiency, the court  simply placed the inculpatory  inferences

          on  an  equal footing  with  various  exculpatory inferences  and

          proceeded  to weigh this  mixed bag.   In other words,  the court

          neither  deferred to  the jury's  presumed choice  of alternative

          inferences, see  Jackson,  443 U.S.  at  326, nor  evaluated  the
                      ___  _______

          potency of  the defendants' hypothesis  of innocence in  light of
                                                               ____________

          those  presumed  choices.     This  improper  focus  emptied  the
          ________________________
                              
          ____________________

               11See,  e.g., United  States v.  Flores-Rivera, __  F.3d ___
                 ___   ____  ______________     _____________
          (1st Cir. 1995) [No. 93-1558]:

                    [I]f the  evidence viewed in  the light  most
                    favorable  to  the  verdict  gives  equal  or
                    nearly  equal  circumstantial  support  to  a
                    theory of guilt and  a theory of innocence of
                    the  crime charged,  this court  must reverse
                    the conviction.   This  is so because  . .  .
                    where  an equal  or  nearly  equal theory  of
                    guilt and  a theory of  evidence is supported
                    by  the evidence  viewed  in  the light  most
                    favorable  to  the prosecution,  a reasonable
                    jury must necessarily entertain  a reasonable
                    doubt.

          Id. at ___ [slip op. at 5] (quoting United States v. Sanchez, 961
          ___                                 _____________    _______
          F.2d 1169, 1173 (5th Cir.), cert. denied, 113 S. Ct. 330 (1992)).
                                      _____ ______

                                          20

          viewpoint principle  of its essential meaning  (causing the court

          to  usurp  the jury's  function)  and  produced a  snapshot  that

          distorted, rather than accurately depicted, the Rule 29 record.

          III.  CONCLUSION
          III.  CONCLUSION

                    We need go no further.   It is trite, but true,  that a

          court "ought not disturb, on the ground of insufficient evidence,

          a jury  verdict that is supported by a plausible rendition of the

          record."  Ortiz, 966 F.2d at 711.  While  there may well be cases
                    _____

          in which  the government's proof  founders in the  "realm between

          preponderance and  `beyond reasonable doubt,'" D. Ct.  Op. at 22,

          see also Hon. Jon O. Newman, Beyond "Reasonable Doubt", 68 N.Y.U.
          ___ ____                     _________________________

          L.   Rev.  979,   986-88   (1993)  (criticizing   the   perceived

          toothlessness  of appellate  application of the  reasonable doubt

          standard  in review  of evidentiary  insufficiency  claims), this

          case is not of that genre.  To the contrary, this case evokes our

          frequently reiterated rule that:

                    [I]n a criminal case, "the  evidence need not
                    preclude    every    reasonable    hypothesis
                    inconsistent with guilt"  in order to sustain
                    a  conviction.   It is  enough that  . .  . a
                    rational jury could  look objectively at  the
                    proof   and   supportably   conclude   beyond
                    reasonable doubt that  the defendant's  guilt
                    had been established.

          United States v. Ingraham,  832 F.2d 229, 239-40 (1st  Cir. 1987)
          _____________    ________

          (internal citation omitted), cert.  denied, 486 U.S. 1009 (1988).
                                       _____  ______

          Because  our perscrutation  of the record  convinces us  that, in

          mulling the issue  of intent, the district  court both misapplied

          the  appropriate legal standard and undervalued  the force of the

          government's overall proof, the judgment below must be

                                          21

          Reversed.
          Reversed.
          ________

                                          22