U.S. v. Dorotich, 88-1441

• Decision Date: 03 April 1990
• Docket Number: No. 88-1441,88-1441
• Citation: 900 F.2d 192
• Parties: 90-1 USTC P 50,202 UNITED STATES of America, Plaintiff-Appellee, v. Eric K. DOROTICH, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 192

900 F.2d 192

90-1 USTC P 50,202

UNITED STATES of America, Plaintiff-Appellee, v. Eric K. DOROTICH, Defendant-Appellant.

No. 88-1441.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Jan. 9, 1990.

Decided April 3, 1990.

Pamela J. Berman, Honolulu, Hawaii, for defendant-appellant.

R. Michael Burke, Asst. U.S. Atty., Honolulu, Hawaii, for plaintiff-appellee.

Appeal from the United States District Court for the District of Hawaii.

Before WALLACE, ALARCON and LEAVY, Circuit Judges.

WALLACE, Circuit Judge:

Dorotich appeals from his conviction for making false claims against the government, 18 U.S.C. Sec. 287, and for mail fraud, 18 U.S.C. Sec. 1341. The district court had jurisdiction pursuant to 18 U.S.C. Sec. 3231, and we have jurisdiction over this timely appeal pursuant to 28 U.S.C. Sec. 1291. We affirm.

I

Dorotich, an inmate at the Oahu Community Correctional Facility, filed tax returns in 1982 and 1984. The returns stated that Dorotich was a head of household, with minor children living at home, and that he was self-employed. They further indicated that Dorotich was the operator of a general store and that he claimed deductions for the cost of goods sold, advertising expenses, bad debts, and legal and professional services. On the basis of his operation of the store, Dorotich claimed and received a tax refund.

Dorotich's 1982 return was prepared for him by Williams, a fellow inmate and former accountant. The 1984 return was prepared by another inmate, Spurgeon, who relied in large part upon the 1982 return. Spurgeon testified that he had a community college education and had filled out "literally hundreds" of inmate tax returns, although he did not have any formal training in tax matters. He also testified that Dorotich reads and writes at a fourth to fifth grade level. He stated that Dorotich supplied information to Williams and Spurgeon, and read, signed, and filed the returns, but did not otherwise assist in their preparation.

Dorotich is indisputably not the head of a household. Although he has at least one minor child, the child does not live with him in prison, nor does Dorotich contribute a majority of the child's support. According to a testifying Hawaii state prison official, Dorotich was not authorized to operate a store in the prison. According to the testimony of Williams and Spurgeon, Dorotich claims to have operated an "unauthorized bartering service," but does not contend that the claimed deductions were legitimate.

Spurgeon pled guilty to tax fraud for his part in the preparation of the returns. Williams and Dorotich were charged with violating 18 U.S.C. Sec. 287 (making false claims against the government) and 18 U.S.C. Sec. 1341 (mail fraud). The jury found both men guilty on all counts. Dorotich appeals, asserting that the district judge abused his discretion in excluding expert testimony of Burris, erred in failing to give a jury instruction on the good faith defense to tax fraud, and that there was insufficient evidence of specific intent to defraud to support the jury verdict.

II

At the close of trial, Dorotich requested that the district judge instruct the jury that if they found that Dorotich relied in good faith upon the advice of Williams and Spurgeon, they should find him not guilty. ¹ The judge rejected this instruction, and Dorotich charges that this rejection constitutes reversible error.

"[T]he failure to give an instruction on a 'good faith' defense is not fatal so long as the court clearly instructed the jury as to the necessity of 'specific intent' as an element of a crime." United States v. Solomon, 825 F.2d 1292, 1297 (9th Cir.1987) (Solomon), cert. denied, 484 U.S. 1046, 108 S.Ct. 782, 98 L.Ed.2d 868 (1988). Solomon's guilt under 26 U.S.C. Sec. 7206(2) (filing false tax returns) turned upon the validity of certain oral patent assignments. Solomon contended that even if the assignments were invalid, he in good faith believed them to be valid and therefore was entitled to a good-faith instruction. We held that "[t]he district court was not required to give a 'good faith belief' instruction with respect to the issue of the validity of oral patent purchase agreements because the jury was instructed to find specific intent as an element of section 7206(2) and the other federal statutes." Id.; accord United States v. Bonanno, 852 F.2d 434, 440 (9th Cir.1988) (Bonanno), cert. denied, --- U.S. ----, 109 S.Ct. 812, 102 L.Ed.2d 801 (1989); United States v. Alcantar, 832 F.2d 1175, 1179 (9th Cir.1987); United States v. Green, 745 F.2d 1205, 1209 (9th Cir.1984), cert. denied, 474 U.S. 925, 106 S.Ct. 259, 88 L.Ed.2d 266 (1985); United States v. Cusino, 694 F.2d 185, 188 (9th Cir.1982), cert. denied, 461 U.S. 932, 103 S.Ct. 2096, 77 L.Ed.2d 305 (1983).

In this case the district judge adequately instructed the jury that one element of the government's case was to prove specific intent beyond a reasonable doubt: that Dorotich filed the returns knowing that they were false. ² We conclude that Solomon dictates the outcome of this issue. Like Solomon, Dorotich's theory of defense--that he lacked specific intent because he relied upon the advice of others--was adequately presented to the jury by way of the specific intent instruction. Therefore, we hold that in a tax fraud case, where the trial court "adequately instructs on specific intent," Bonanno, 852 F.2d at 440, the failure to give an additional instruction on good faith reliance upon expert advice is not reversible error.

We recognize that a number of circuits have held in tax fraud cases that it is reversible error to refuse to give an instruction on good faith reliance on expert advice where some evidence exists to support such a defense. United States v. Duncan, 850 F.2d 1104, 1117-18 (6th Cir.1988); United States v. Mitchell, 495 F.2d 285, 287-88 (4th Cir.1974); United States v. Platt, 435 F.2d 789, 792 (2d Cir.1970); Bursten v. United States, 395 F.2d 976, 981-82 (5th Cir.1968); United States v. Phillips, 217 F.2d 435, 440-41 (7th Cir.1954). However, Solomon precludes us from adopting the reasoning of these decisions.

III

Dorotich alleges that the trial court erred in refusing to admit the expert testimony of Burris, a certified public accountant. The trial court's decisions on the admissibility of expert testimony are reviewed for "an abuse of discretion or 'manifest error.' " United States v. Binder, 769 F.2d 595, 601 (9th Cir.1985), quoting United States v. Marabelles, 724 F.2d 1374, 1381 (9th Cir.1984).

Burris played no role in the preparation of the returns in question. According to Dorotich, if he had been permitted to testify, Burris would have "giv[en] his expert opinion on the acceptability of the techniques used by [ ] Williams and Spurgeon in their preparation [of the returns] and the accuracy of that preparation." However, such testimony would have been irrelevant. The government did not allege error in the technical preparation of the forms, or suggest that the returns were not filled out in accordance with proper accounting principles. Rather, the charge was that the returns contained misstatements of fact. Burris had no knowledge of the accuracy or inaccuracy of the facts underlying the returns. Dorotich proposed to ask him only whether, assuming the facts shown on the return were correct, it was a valid return. The district court did not abuse its discretion in excluding this testimony.

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