Court Opinion

ID: 9475515
Source: CourtListenerOpinion
Date Created: 2023-08-05 05:29:51.088129+00
Date Added: 2024-06-11T17:44:45.739450
License: Public Domain

*576FERGUSON, Circuit Judge,
concurring:
I concur in Judge Fletcher’s opinion. I write separately in an effort to clarify our decision in United States v. Dahlstrom, 713 F.2d 1423 (9th Cir.1983), cert. denied, 466 U.S. 980,104 S.Ct. 2363, 80 L.Ed.2d 835 (1984).
Initially, I disagree with the district court’s decision to dismiss a number of counts without benefit of trial. The court ruled that, regardless of what evidence might be produced, the government could not prove willfulness unless an appellate court had previously held the specific tax shelter scheme illegal. I know of no law that permits the dismissal of an indictment based upon the nonexistence of facts, such as a defendant’s state of mind, prior to trial. The district court’s reliance on Dahlstrom is misplaced, for Dahlstrom was decided after a trial in which the government had ample opportunity to demonstrate defendants’ willfulness.
Further, as a member of the panel in Dahlstrom, I view its facts and holding differently than did the district court. In Dahlstrom, there were two different categories of defendants. The first group, including all of the defendants except Durst, only advocated tax shelters — they did no more than talk. They prepared no false or fraudulent documents for the I.R.S.; at most, they may have counseled such a preparation. The bulk of the opinion, then, dealt with a group of people whose acts could not possibly be “advocacy ... directed to inciting or producing imminent lawless action ... likely to incite or produce such action.” Dahlstrom, 713 F.2d at 1428 (quoting Brandenburg v. Ohio, 395 U.S. 444, 447,89 S.Ct. 1827,1829,23 L.Ed.2d 430 (1980) (per curiam). The prosecution under I.R.C. § 7206(2) thus failed because it failed to prove incitement of imminent unlawful action.
Defendant Durst presented a different case, for he had prepared a tax return based upon the fraudulent tax plan. His conviction was reversed nonetheless because we found the filing of a document an essential element of a conviction under I.R.C. § 7206(2), and the return prepared by Durst was never filed. See Dahlstrom, 713 F.2d at 1429.
Dahlstrom holds, as noted in its Conclusion, that “[p]rosecution for advocacy of a tax shelter program in the absence of any evidence of a specific intent to violate the law is offensive to the first and fifth amendments of the United States Constitution.” Id. (emphasis added). The Dahlstrom case was primarily a First Amendment case involving pure advocacy. The defendants there were prosecuted even though nothing gave them fair warning that advocacy of the tax shelter would result in a criminal prosecution. It is doubtful that a statute prohibiting advocacy in tax matters would, absent imminent unlawful action, withstand the First Amendment’s protection of speech.
The case at hand does not present a case of pure advocacy. The counts of the indictment that were dismissed allege various unlawful acts, not mere speech, on the part of the defendants. The defendants are not prosecuted for the advocacy of false or fraudulent statements, but for various acts in support of false or fraudulent statements. Their case is outside the advocacy protection granted by Dahlstrom.