Court Opinion

ID: 4504403
Source: CourtListenerOpinion
Date Created: 2020-02-04 21:00:12.096384+00
Date Added: 2024-06-11T13:41:18.737846
License: Public Domain

18-2053-cr
United States v. DiMartino

      18‐2053‐cr
      United States v. DiMartino

                        United States Court of Appeals
                            for the Second Circuit
                                     AUGUST TERM 2019
                                       No. 18‐2053

                                UNITED STATES OF AMERICA,
                                        Appellee,

                                              v.

                                     TERRY DIMARTINO,
                                    Defendant‐Appellant.

                                ARGUED: SEPTEMBER 26, 2019
                                DECIDED: FEBRUARY 4, 2020

      Before:     JACOBS, SACK, HALL, Circuit Judges.

            Terry DiMartino appeals from the judgment of the United States District

      Court for the District of Connecticut (Thompson, J.) sentencing him to 70 months’

      imprisonment for tax offenses. On appeal, DiMartino argues that the district

      court abused its discretion by denying his post‐trial request for a competency

      hearing based chiefly on his adherence to the Sovereign Citizen movement. The

                                              1
government argues that the district court properly determined that the

psychologist’s report tendered by DiMartino was unreliable, and that the trial

record reflects DiMartino’s understanding of the charges against him and his

meaningful participation in his defense.

      We AFFIRM.

                              ____________________

                          CHARLES E. MCFARLAND, New Castle, KY, for
                          Defendant‐Appellant Terry DiMartino.

                          ELISSA HART‐MAHAN (Richard E. Zuckerman, S.
                          Robert Lyons, Stanley J. Okula, Jr., Alexander P.
                          Robbins, on the brief), United States Department of
                          Justice, Washington, DC, for Appellee United States of
                          America.

DENNIS JACOBS, Circuit Judge:

      Terry DiMartino appeals from a judgment of the United States District

Court for the District of Connecticut (Thompson, J.) convicting him for his

multi‐year failure to pay taxes and for his deception and obstruction of the

IRS‐‐conduct inspired by the Sovereign Citizen movement, a loosely affiliated

group who “‘follow their own set of laws’ and, accordingly, ‘do not recognize

federal, state, or local laws, policies or regulations’ as legitimate.” United States

                                           2
v. McLaughlin, ‐‐‐ F.3d ‐‐‐, 2019 WL 7602324, at *1 n.1 (2d Cir. December 30, 2019)

(quoting Sovereign Citizens: A growing Domestic Threat to Law Enforcement,

FBI Law Enforcement Bulletin (2011)). DiMartino, a successful insurance agent,

represented himself at trial and was convicted.

      After trial and before sentencing, DiMartino retained counsel, who moved

for a hearing to determine whether DiMartino had been competent to stand trial.

Counsel argued that DiMartino’s bizarre conduct before and during trial raised a

series of red flags impugning his mental fitness, and submitted a psychological

report from Dr. Andrew Meisler, who had interviewed DiMartino and examined

part of the trial record.

      The district court held a Daubert hearing to enable it to determine whether

Dr. Meisler’s proffered expert testimony “rest[ed] on a reliable foundation and

[was] relevant to the task at hand.” Daubert v. Merrell Dow Pharmaceuticals,

Inc., 509 U.S. 579, 589, 597 (1993). After the hearing, at which the government

and counsel for DiMartino each had the opportunity to examine Dr. Meisler, the

district court denied DiMartino’s request for a competency hearing. The district

court ruled that: [1] the psychological report‐‐which concluded that DiMartino

was suffering from a delusional disorder, but largely ignored the Sovereign

                                        3
Citizen context‐‐was unreliable; and [2] DiMartino’s behavior, observed by the

court before and during trial, indicated that DiMartino understood the charges

against him and participated meaningfully in his defense.

      The court entered final judgment sentencing DiMartino to 70 months’

imprisonment. DiMartino appeals. We have not previously considered the

competency of a self‐identified Sovereign Citizen in a published opinion; and in a

prior case dealing with a tax skeptic we remanded for a competency hearing.

See United States v. Auen, 846 F.2d 872, 877‐79 (2d Cir. 1988). Here, however,

we agree with the district court that DiMartinoʹs actions and statements did not in

themselves constitute reasonable cause to doubt his competency. The denial of

his request for a competency hearing therefore was not an abuse of discretion.

      The judgment of the district court is affirmed.

                                          I

      “We derive the following facts from the evidence adduced at trial, which

we describe in the light most favorable to the Government, the prevailing party.”

United States v. Caltabiano, 871 F.3d 210, 213 (2d Cir. 2017) (citation omitted).

From the early 1980s, DiMartino earned substantial commissions as an

                                         4
independent insurance agent. Beginning with the 1996 tax year, coincident with

DiMartino’s divorce, he consistently failed to file accurate tax returns, or filed no

returns at all. For example, in 1999, he falsely filed a “zero return” for the 1997

tax year. From 2000 on, DiMartino received numerous delinquency notices

from the IRS.

      When the IRS filed liens against DiMartinoʹs property and sought to

garnish his commissions, he took steps to evade and obstruct. For instance, he

acquired a home through a trust that obscured his ownership and directed

insurance companies to divert his commissions to nominee companies he created

and controlled.

      In addition to these schemes, DiMartino sent a steady stream of

correspondence to the IRS claiming that the federal government lacks legal or

constitutional authority to collect taxes. Sometimes, DiMartino threatened legal

action against the IRS officer responsible for his case; at other times, he proffered

counterfeit bonds to satisfy his tax liabilities. In response, the IRS repeatedly

sent educational materials debunking many of his arguments, which the IRS had

encountered before.

      DiMartino was successful, for a time. From 2004 to 2013, when

                                          5
DiMartino earned more than $2.4 million in commissions, the IRS was able to

recoup only $32,000, less than 1.5% of his income. He also managed to evade at

least $100,000 in state taxes during this period. However, he kept up his

property taxes, default on which would likely result in seizure of his home.

      In 2014, DiMartino was charged with one count of corruptly endeavoring

to obstruct the IRS, two counts of filing false tax returns, and five counts of

willful failure to file tax returns. DiMartino invoked his right to represent

himself at trial and testified at a lengthy Faretta hearing, see Faretta v. California,

422 U.S. 806 (1975), held to determine whether his waiver of his right to counsel

was knowing and voluntary. DiMartino testified that he was in good health,

that his mind was clear, and that he was not under the care of a psychiatrist. He

described his education and professional experience; his personal study of

Supreme Court cases and the U.S. Constitution; and his familiarity with the

statutes and regulations that govern the insurance industry. The district court

ruled that DiMartino knowingly, voluntarily, and intelligently waived his right

to counsel. Standby counsel was appointed to assist him.

      At trial, DiMartino argued that he did not intend to violate the law and did

not know that the fraudulent documents he signed were illegal. He explained

                                           6
his theories that: the IRS and Department of Justice are private corporations; he

was not subject to the court’s jurisdiction; and the laws requiring him to pay

taxes were nonexistent or invalid. In one instance, when the court cautioned

DiMartino against making statements of law, DiMartino clarified that he was

only offering his own “interpretation”‐‐ostensibly in support of his defense that,

at the time of the alleged offenses, he had a good faith belief that his actions were

legal.

         DiMartinoʹs closing statement emphasized that his views were based on

years of study and deliberation:

               This is not an act. I’m not crazy. . . . All that evidence you saw
               really just points to how committed I was the entire 20 years. Did
               you see how many documents I submitted? Did you see how
               many classes I attended? Did you see how much money and effort
               I spent to find the truth? That wasn’t circumstance. That was me
               digging in to find what’s really real.

App’x 38. DiMartino’s defense was unsuccessful: the jury delivered a verdict

convicting him on all counts.

         Approximately one month after the filing of the final Presentence

Investigation Report (the “PSR”), DiMartino retained counsel. Several months

later, defense counsel submitted a motion asking the court to order a

                                          7
psychological evaluation and hold a competency hearing pursuant to 18 U.S.C. §

4241. Accompanying the motion was a psychological report prepared at

counsel’s request. Dr. Andrew Meisler, who had conducted several interviews

with DiMartino, concluded that he was suffering from a delusional disorder. In

addition, counsel submitted his own affidavit summarizing the bases for his

concerns about his client’s competency, focusing on DiMartino’s “bizarre

theories.” App’x 152. For example, counsel averred that, notwithstanding the

conviction, DiMartino “still thinks he should be released at sentencing because

the IRS and the United States government are private corporations.” App’x 155.

      In January 2017, the district court held a hearing to examine the reliability

of Dr. Meisler’s report (and to determine whether there was reasonable cause to

hold a competency hearing). The government and counsel for DiMartino

examined Dr. Meisler about his report’s conclusions and the methods employed

in preparing it. The court also heard testimony from Dr. Howard Zonana, who,

at the court’s invitation, advised the court on the proper methodology for

diagnosing delusional disorder in such cases.

      The request for a competency hearing was denied. The courtʹs June 28,

2018 ruling highlighted methodological flaws in Dr. Meisler’s report and

                                         8
accorded it no weight. The court set forth its own observations of DiMartino,

reviewed the full record, and concluded that there was no reasonable cause to

believe that DiMartino did not understand the nature and consequences of the

proceedings against him.

                                          II

         The denial of a motion to hold a competency hearing is reviewed for abuse

of discretion. United States v. Arenburg, 605 F.3d 164, 169 (2d Cir. 2010). In

exercising its discretion, the district court must “make findings on the record

concerning the defendant’s competency where the facts presented to the court

warrant such an inquiry.” United States v. Auen, 846 F.2d 872, 878 (2d Cir.

1988).

         On appeal, DiMartino argues that the district court abused its discretion by

overlooking certain red flags in DiMartino’s behavior, and that it should have

been obvious that DiMartino was mentally incompetent to stand trial. But the

record supports the conclusion that DiMartinoʹs words and actions reflected his

anti‐government political views and legal theories rather than an inability to

understand the proceedings against him. Therefore, we conclude that it was

                                           9
not an abuse of discretion for the district court to deny his request for a

competency hearing.

      Section 4241(a) safeguards the constitutional due process rights of criminal

defendants by requiring district courts to hold a competency hearing if, at any

time prior to sentencing, “there is reasonable cause to believe that the defendant

may presently be suffering from a mental disease or defect rendering him

mentally incompetent to the extent that he is unable to understand the nature

and consequences of the proceedings against him or to assist properly in his

defense.” 28 U.S.C. § 4241(a).

      Whether “reasonable cause” to hold a hearing exists is a highly

particularized assessment that “varies in each case.”    United States v. Zhou, 428
F.3d 361, 379 (2d Cir. 2005) (quoting United States v. Nichols, 56 F.3d 403, 414 (2d

Cir. 1995)) (internal quotation marks omitted). Among relevant considerations

are psychiatric reports assessing the defendant’s competence, see Zhou, 428 F.3d

at 379, and the court’s own “observations of the defendant’s demeanor during

the proceeding,” United States v. Quintieri, 306 F.3d 1217, 1233 (2d Cir. 2002).

The court must remain alert to issues of competence throughout a criminal

proceeding. That obligation “takes on increased significance where, as here, a

                                         10
criminal defendant elects to proceed pro se.” Arenburg, 605 F.3d at 169.

      Counsel for DiMartino points to a series of his clients’ actions and

statements that he characterizes as irrational. These red flags include, most

notably: DiMartino’s refusal to prepare an accurate tax return prior to

sentencing; his stated beliefs that his prosecution and the tax laws underlying it

were illegitimate; his decision to make duplicative and obviously inaccurate or

meritless filings with the IRS and with the court; and statements during trial that

indicated continuing adherence to meritless legal theories.1

      In some instances, DiMartino’s statements in court may well have been the

result of genuine confusion about certain legal doctrines; when for example he

asked the district court whether it followed “the Connecticut and Federal Rules

of Civil Procedure.” App’x 120. But a defendant’s “technical legal knowledge,

as such, [is] not relevant to an assessment of his knowing exercise of the right to

defend himself.” Faretta, 422 U.S. at 836; see also McCoy v. Louisiana, 138 S. Ct.
1500, 1507 (2018) (“[A]n accused may insist upon representing herself‐‐however

1 Counsel for DiMartino also points to the conclusions in Dr. Meisler’s
psychological report as an additional red flag; but the district court reasonably
concluded that Dr. Meisler’s conclusions were not reliable, as discussed in Part
III of this opinion.

                                         11
counterproductive that course may be.”) (citing Faretta, 422 U.S. at 834).

      Here, the district court reasonably inferred from DiMartino’s conduct at

trial that he understood the proceedings against him and was capable of

participating meaningfully in his defense. Among other things, DiMartino

attempted to persuade the jury that he lacked the requisite criminal intent; he

solicited the jury’s sympathy; and he made a bid for jury nullification. Lesser

participation has sufficed to demonstrate competency. See U.S. v. Sovie, 122
F.3d 122, 128 (2d Cir. 1997) (noting that district court’s conclusion that defendant

was a “knowing participant in his defense” was supported by the fact that the

defendant “took notes, conversed with counsel, and reacted reasonably to the

admission of evidence”).

      Crucially, nearly all the purported red flags concerning DiMartino’s

competence relate in one way or another to his insistence on espousing or acting

on views that are shared with other adherents to a political ideology, however

marginal. At trial, the government presented evidence that the rhetoric

DiMartino used in his correspondence with the IRS‐‐and continued to espouse at

trial‐‐was typical of groups that resist the federal tax laws. Indeed, an

undercover IRS agent observed DiMartino at a 2007 Sovereign Citizen

                                         12
convention in Las Vegas, where he expressed frustration at having to “pa[y] [his]

ass up in taxes” and asked seminar participants for advice on how sovereign

citizens “that have wealth . . . protect their wealth.” Ex. FBI‐1A at 52‐53, 86.

      The kinds of unorthodox political and legal theories espoused by

DiMartino are not presumptive evidence of mental incompetence. On the

contrary, there are many reasons that mentally competent criminal defendants

choose to pursue unsupported or even outlandish theories in their defense. For

instance, in Clark, the defendant was a self‐proclaimed revolutionary freedom

fighter; her radical political views, though altogether different from DiMartino’s,

similarly inspired her to challenge the legitimacy of the government and the

proceedings against her. Clark v. Perez, 510 F.3d 382, 386‐88 (2d Cir. 2008).

Despite “ample notice” that the defendant would mount a “disruptive, political

defense” at trial, the trial court determined that she was competent to proceed to

trial and represent herself pro se‐‐a determination that was never challenged.

Id.

      Here, as the district court found, the record suggests that it is at least as

likely that DiMartino simply disagreed with the tax laws, as opposed to suffering

from a delusional disorder that prevented him from understanding them.

                                          13
DiMartino was a person of affairs who used devious and elaborate means of

evasion. His obsession, though out of the mainstream, was one that promoted

his material self‐interest. Accordingly, we agree with other circuits that have

held that political views derived from tax protester movements‐‐however they

appear to the uninitiated‐‐are not, by themselves, sufficient evidence of mental

incompetence. See, e.g., United States v. Neal, 776 F.3d 645, 656‐57 (9th Cir.

2015) (holding that defendant’s “voluminous filings of nonsensical pleadings

[did] not create per se serious doubt about competency” since his conduct was

indicative of a “‘sovereign citizen’ belief system” rather than a “lack of

competence”); United States v. Brown, 669 F.3d 10, 18 (1st Cir. 2012) (holding

that Sovereign‐Citizen defendant’s meritless legal arguments “did not evidence

confusion on [defendant’s] part about the legal proceedings against him, but

rather reflected firmly held, idiosyncratic political beliefs punctuated with a

suspicion of the judiciary”).

      Symptoms of actual mental illness may of course coexist with adherence to

conspiracy theories or fringe political movements. On this point, DiMartino

relies on Auen, 846 F.2d 872. But Auen does not support the proposition that

one who considers himself exempt from taxation is also presumptively exempt

                                         14
from trial. Competency to stand trial is not an issue decided categorically: in

Auen, the defendant displayed characteristics that would suggest mental illness

regardless of his views of taxation and the constitution. Auen had ʺparanoidʺ

beliefs, id. at 878, and had sent a letter containing a thinly veiled death threat to

an IRS special agent, id. at 874. The court observed that Auen’s letter, which

recounted the murder of a cat named Sweeney, “[could] only be characterized as

the product of a disturbed mind.” Id. at 878.

      Here, we cannot say that it was an abuse of discretion to deny DiMartinoʹs

motion for a competency hearing. The district court relied on its own

observations over the course of the proceedings and carefully weighed the only

evidence of incompetency proffered by counsel: Dr. Meisler’s report and the

affidavit of a lawyer who formed his opinion based on interviews with his client

during the relatively short period between his retention and the filing of the

competency motion. See United States v. Kerr, 752 F.3d 206, 218 (2d Cir. 2014),

as amended (June 18, 2014) (noting that “the district court had substantially

longer experience with [the defendant] over the course of the proceedings” than

did stand‐by counsel, who represented to the court that his client was acting

irrationally).

                                          15
      Keeping in mind the “deference . . . owed to the district court’s

determinations based on observation of the defendant during the proceedings,”

United States v. Vamos, 797 F.2d 1146, 1150 (2d Cir. 1986), and the evidence that

DiMartino was an active participant in his defense, we conclude that the district

court did not abuse its discretion by denying DiMartino’s motion for a

competency hearing.

                                        III

      The exercise of discretion to deny a competency hearing was heavily

influenced by the district court’s decision to assign no weight to the

psychological report prepared by Dr. Meisler. DiMartino argues that the court

thereby abused its discretion. That argument is without merit because the

record demonstrates that the court conducted a thorough hearing to assess the

reliability of Dr. Meisler’s report and reasonably concluded that it was

unreliable.

      “[A] court of appeals is to apply an abuse‐of‐discretion standard when it

‘review[s] a trial courtʹs decision to admit or exclude expert testimony.’”

Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999) (quoting Gen. Elec. Co. v.

                                         16
Joiner, 522 U.S. 136, 138, 139, (1997)); see also Boucher v. United States Suzuki

Motor Corp., 73 F.3d 18, 21 (2nd Cir. 1996) (a judge’s discretion to admit or

exclude expert evidence “is to be sustained unless manifestly erroneous”).

      As an initial matter, DiMartino argues that the district court was required

to hold a competency hearing because Dr. Meisler’s report met the standards

listed in 18 U.S.C. § 4247(c). This argument is a non‐starter. Section 4247(c)

prescribes formal requirements for a psychological report if such report is

“ordered” by the court; it does not apply to Dr. Meisler’s report, which was

commissioned by the defense. And even if § 4247(c) were applicable, its

requirements would have little bearing on the reliability of the report or the

weight the court should give to its findings.

      Instead, the district court assessed the reliability of Dr. Meisler’s report by

applying Federal Rule of Evidence 702 and Daubert v. Merrell Dow

Pharmaceuticals, Inc., 509 U.S. 579 (1993). DiMartino contends that this was

error because the Rule 702 factors govern admissibility, whereas the court

improperly used them to decide the weight it would give to Dr. Meisler’s report.

That argument is also without merit: Rule 702 “establishes a standard of

evidentiary reliability,” not just admissibility. Kumho Tire, 526 U.S. at 149; see

                                         17
also United States v. Williams, 506 F.3d 151, 160 (2d Cir. 2007) (recognizing that

Rule 702 provides “indicia of reliability” for expert testimony). The Daubert

and Rule 702 factors thus provided an appropriate framework for the district

court’s well‐supported determination that Dr. Meisler’s report was unreliable.

       The district did not abuse its discretion in deciding to give no weight to Dr.

Meisler’s report. First, the court’s determination that the report was “based on

[in]sufficient facts [and] data,” Fed. R. Evid. 702(b), was justified given Dr.

Meisler’s failure to read transcripts from much of DiMartino’s trial and failure to

seek collateral support for DiMartino’s assertions‐‐for example by interviewing

DiMartino’s family members, friends, or associates, see Ruling on Motion to

Determine Competency, June 28, 2018, at 12‐13.     Second, it was not an abuse of

discretion for the district court to find that Dr. Meisler employed “[un]reliable

principles and methods,” Fed. R. Evid. 702(c), because he failed to consider the context

of the Sovereign Citizen movement when evaluating DiMartino’s belief system. The

district court’s conclusion that Dr. Meisler’s methods were unreliable was supported by

the opinion of the court‐appointed expert, Dr. Zonana, who had experience evaluating

Sovereign Citizens.

                                            18
      Finally, DiMartino argues that the court erred by applying the Rule 702

standard to Dr. Meisler’s report but failing to do the same for Dr. Zonana, the

court‐appointed expert. However, the sole purpose of the court’s Daubert

hearing was to determine the reliability of Dr. Meisler’s report‐‐and, by

extension, the weight the report should be given in the reasonable cause

inquiry‐‐with Dr. Zonana providing only background information that would

assist the court in its analysis of Dr. Meisler’s testimony. Even if we were to

conclude that the district court improperly relied on Dr. Zonana’s testimony

without explicitly ruling on its admissibility or reliability under Rule 702, the

error would be harmless, because Meisler’s own admissions at the Daubert

hearing provided ample support for the district court’s conclusion that the report

was unreliable.

      Significantly, Dr. Meisler agreed with Dr. Zonana’s testimony that an

individual’s membership in a subculture is an “important” factor in determining

whether his beliefs are delusional. App’x 262. But, as the district court found,

Dr. Meislerʹs report “did not discuss any information regarding circumstances

surrounding the development of the defendant’s belief system, how it evolved,

or how it played a role in his decision not to pay taxes.”   Ruling on Motion to

                                         19
Determine Competency at 18. Likewise, Dr. Meisler conceded that DiMartino’s

purported delusions are “fairly circumscribed around the government and the

tax code and the history and the law.” App’x 169. And the report overlooked

evidence that DiMartino’s unorthodox political views did not impair him in

other areas of his life: his earnings show considerable success as an insurance

salesman long after he stopped paying taxes; and DiMartino’s PSR noted that his

siblings were unaware of him having any mental health problems.

      Dr. Meisler’s approach to fact‐gathering compounded these issues: he

reviewed only a fraction of the trial transcript, and did not speak to DiMartino’s

family, friends, or other tax protesters. In sum, the district court did not abuse

its discretion when it concluded that Dr. Meisler’s report could not be relied

upon to support a finding of reasonable cause to hold a competency hearing.

                                 CONCLUSION

      We have considered DiMartino’s remaining arguments and found them to

be meritless. For the foregoing reasons, the judgment of the district court is

hereby AFFIRMED.

                                        20