U.S. v. Adkinson

• Decision Date: 26 October 1998
• Docket Number: Nos. 92-2872,95-2061,s. 92-2872
• Parties: -6984, 98-2 USTC P 50,842, 12 Fla. L. Weekly Fed. C 187 UNITED STATES of America, Plaintiff-Appellee, Cross-Appellant, v. William Michael ADKINSON, Ann Powell Minks, f.k.a. Ann Powell, et al., Defendants-Appellants, Cross-Appellees. UNITED STATES of America, Plaintiff-Appellee, v. Ronald D. PEEK, Ann Powell Minks, et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1147

158 F.3d 1147

82 A.F.T.R.2d 98-6984, 98-2 USTC P 50,842,

12 Fla. L. Weekly Fed. C 187

UNITED STATES of America, Plaintiff-Appellee, Cross-Appellant, v. William Michael ADKINSON, Ann Powell Minks, f.k.a. Ann

Powell, et al., Defendants-Appellants, Cross-Appellees.

UNITED STATES of America, Plaintiff-Appellee, v. Ronald D. PEEK, Ann Powell Minks, et al., Defendants-Appellants.

Nos. 92-2872, 95-2061.

United States Court of Appeals, Eleventh Circuit.

Oct. 26, 1998.

Clifford L. Davis, Monticell, FL, for Adkinson.

Samuel J. Buffone, Ropes & Gray, Washington, DC, Michael E. Tigar, Denver, CO, James K. Jenkins, Maloy & Jenkins, Atlanta, GA, Terrance G. Reed, Washington, DC, for Minks and Collins.

Daniel D. Kistler, Houston, TX, pro se.

Steven Quinnell, Pensacola, FL, Michael E. Tigar, Denver, CO, for Peek.

Richard A. Tinsley, Kemah, TX, pro se.

Stanley G. Schneider, Schneider & McKinney, Houston, TX, for Koshkin.

Kenneth R. Ridlehoover, Pensacola, FL, for Dufilho.

Robert Alfert, Jr., Steven Michael Staes. Broad & Cassel, Orlando, FL, for Alligood.

William Wagner, Gainesville, FL, Benjamin W. Beard, Asst. U.S. Atty., Pensacola, FL, for United States.

Appeals from the United States District Court for the Northern District of Florida.

Before DUBINA, Circuit Judge, and HILL and GIBSON ^*, Senior Circuit Judges.

HILL, Senior Circuit Judge:

Following a jury trial, defendants were convicted of various offenses, including conspiracy, bank, mail and wire fraud, and interstate transportation of stolen property. They appealed these convictions. In United States v. Adkinson, 135 F.3d 1363 (11th Cir.1998) (Adkinson I ), we vacated all convictions on Count I, holding that the inclusion in the indictment, and last-minute dismissal, of allegations that the government knew did not state a crime under governing Eleventh Circuit precedent rendered defendants' trial on that count "fundamentally unfair." We also vacated all convictions on Counts II, III, VI, VIII, and IX for failure of the redacted indictment to adequately allege the scheme--an essential element--underlying the offenses charged in these counts.

Defendants also claimed, however, that there was insufficient evidence on all of these counts to support their convictions. As its response, the government recited the elements of the various offenses, and then asserted:

The evidence adduced during the course of this trial clearly established that the defendants participated in a massive scheme to defeat the lawful function of the Internal Revenue Service, and to commit bank fraud with respect to Vision Banc, a savings and loan association out of Redhill, Pennsylvania. During the course of that conspiracy, as set forth in the statement of facts, the defendants used the mail and interstate wire services to effectuate and further the scheme to defraud. Finally, during the course of the proceeding stolen property or property taken by fraud, was transported interstate. That being true, the conviction must sustain.

There was, however, not one citation to the record evidence supporting this assertion. Furthermore, in the portion of the government's brief reciting the facts which it believes it established at trial, there were repeated references to certain record volumes at "passim" which directs us to entire volumes of testimony. We were both unable and unwilling to "sift through these pages by ourselves, unguided by an advocate"... "looking for what we believe the government proffers as supporting evidence on the fact issue being discussed." Adkinson I, 135 F.3d at 1379. Therefore, we directed the government to submit a supplemental brief which would readdress the issue of the sufficiency of the evidence and conform to Eleventh Circuit Rule 28-2(l) which requires the parties to support their assertions regarding matters in the record with references to the volume or document number and page number of the original record. ¹ Defendants were permitted to reply. ²

All supplemental briefing having now concluded, we turn to the final issue before us--whether there was sufficient evidence supporting these convictions to permit retrials. ³ See Burks v. United States, 437 U.S. 1, 11, 98 S.Ct. 2141, 57 L.Ed.2d 1 (1978) (double jeopardy clause forbids a second trial for the purpose of affording the prosecution another opportunity to supply evidence which it failed to muster in the first proceeding). In reviewing the sufficiency of the evidence, we view it de novo, but in the light most favorable to the government, and accepting all reasonable inferences which support the verdict in order to determine if there was substantial evidence from which a reasonable trier of fact could have concluded that the defendants were guilty beyond a reasonable doubt. United States v. Newton, 44 F.3d 913, 922 (11th Cir.1994).

I.

Count I of the original indictment in this case charged a massive bank fraud conspiracy in which the huge proceeds of two allegedly fraudulently obtained bank loans were diverted for personal use. ⁴ At the close of the government's case, the district court dismissed these allegations because they did not state a crime under the then-prevailing law of this circuit. See Adkinson I, 135 F.3d at 1370.

After dismissal of the bank fraud allegations, the sole remaining purpose of the conspiracy charged in Count I was to defraud the United States by impeding the lawful functions of the Internal Revenue Service (IRS). The indictment alleged that:

[T]he purpose of the conspiracy to impede and impair the Internal Revenue Service was to defraud the United States (a) by concealing and causing to be concealed income generated from the proceeds of certain false and fraudulent loan transactions which proceeds were purportedly applied to real estate transactions but were in actuality diverted and distributed among a number of persons and entities and which proceeds constituted taxable income to the one or more persons or entities receiving and possessing said proceeds, and (b) by either failing to file federal income tax returns which if truthfully filed would have disclosed the existence of said income or by filing false tax returns that failed to report income derived from the proceeds of the false and fraudulent loans....

Defendants Michael Adkinson, Robert Collins, Robert Alligood, Benjamin Koshkin and Ronald Peek were convicted on Count I. ⁵ In ruling on their motions for judgment of acquittal, the district court commented:

[T]here's been some serious doubt in my mind as to what really has been established by the government in connection with the stated purpose of the remaining portion of the conspiracy. In truth, there really has not been much evidence that there was a conspiracy to conspire or frustrate the IRS function in this case....

Part of the problem is that the government has attempted to turn a bank fraud case into a case that includes an income tax case and a mail fraud case, and everything else, and the pieces simply don't fit together very well.

See Adkinson I, 135 F.3d at 1378 n. 44. Despite its misgivings, the district court denied defendants' motions.

In its brief filed in response to our request that it cite specifically to the record evidence supporting the tax conspiracy convictions, on page one the government characterizes Count I as a "Conspiracy to Defeat the Lawful Functioning of the IRS." In the remaining sixty-eight pages of the brief, however, the government does not again refer to the IRS, nor to the function which defendants are alleged to have defeated. Nor is there any mention of the statutory elements of a Section 371 tax conspiracy or any discussion whatsoever of the government's proof of these elements.

The word "tax," in fact, appears only once in the government's brief. On page 48, the government asserts that the "cover-up" phase of the charged bank fraud scheme included the "tax related activities of the defendants, (as explained by cooperating witnesses)." ⁶ There is no further explanation of these activities.

The only references to any evidence which could remotely relate to Count I which we can find in the government's supplemental brief are several assertions that certain defendants received various sums of money which were "later reported as loans." The record citations are to testimony, primarily that of Richard Maniscalco, the comptroller for Development Group, Inc. (DGI), one of Adkinson's corporations, who testified that these payments were not reported to the IRS by way of Tax Form 1099 which informs the IRS of individuals' receipt of income. This testimony is also cited as support for the government's assertion that Adkinson "instructed all involved how to report the money." ⁷

We assume that the government means to assert that these defendants were obligated to but did not report this income to the IRS. ⁸ This is apparently the government's theory of the tax conspiracy. The supporting evidence is the payments by DGI to the defendants which were "reported as loans." No tax returns are cited as proof.

In assessing the adequacy of this proof, we note several problems. First, of the five defendants convicted on Count I, two--Collins and Peek--are not included by the government in this group of putative income tax evaders. ⁹ There is no citation at all to record evidence supporting the Count I convictions of defendants Collins and Peek. In fact, even in the section where the government details each of the "Defendants' Roles" in this case, there is no mention whatsoever of any "tax related activities" on the part of these defendants. Although the connection of these defendants to the alleged tax conspiracy need only be "slight," United States v. Toler, 144 F.3d 1423, 1427 (11th Cir.1998), the government must have demonstrated with substantial proof that there was, in fact, some connection. ¹⁰ Id. at 1426-28. As the record is apparently devoid of such evidence as to Peek, ¹¹ we will reverse his conviction on Count I. ...