U.S. v. Lewis

• Decision Date: 24 February 1982
• Docket Number: No. 81-2258,81-2258
• Citation: 671 F.2d 1025
• Parties: 82-1 USTC P 9236 UNITED STATES of America, Plaintiff-Appellee, v. Donald L. LEWIS, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1025

671 F.2d 1025

82-1 USTC P 9236

UNITED STATES of America, Plaintiff-Appellee, v. Donald L. LEWIS, Defendant-Appellant.

No. 81-2258.

United States Court of Appeals Seventh Circuit.

Argued Feb. 8, 1982.

Decided Feb. 24, 1982.

Patrick B. Mathis, John J. Vassen, Belleville, Ill., for defendant-appellant.

James R. Burgess, Jr., U. S. Atty., East St. Louis, Ill., for plaintiff-appellee.

Before SPRECHER and POSNER, Circuit Judges, and BONSAL, Senior District Judge. ^*

POSNER, Circuit Judge.

Donald Lewis was convicted after a jury trial of having violated 26 U.S.C. § 7203, which so far as relevant here makes it a misdemeanor for a person required to pay federal income tax to "willfully" fail to file a tax return. He appeals on two grounds: that the trial judge should have required the government to disclose the identity of the person who informed against Lewis; and that the judge's instructions to the jury on the meaning of "willfully" were inadequate.

Lewis never finished high school (a fact germane, as we shall see, to his defense theory), yet during the period in question he was the sole proprietor of a substantial business engaged in drilling oil wells and just before that he had owned and operated a gas station. Between 1976 and 1978 he paid out more than a half million dollars in wages to the employees of his oil-well drilling business but did not pay any of the $137,000 in federal withholding taxes that were due on those wages and did not file the required withholding returns although he had them prepared. He claims that he did not file the returns because he did not have the money to pay the taxes and thought that one may not file a return without accompanying it with payment in full of any taxes due.

Prior to trial Lewis discovered that there was an informer involved in the case, and the judge held a hearing to decide whether the name of the informer should be revealed to Lewis. After hearing testimony that the informer, a "tipster," had not provided any information included in reports prepared by Internal Revenue Service agents working on the case, nor received payment or any favorable consideration in exchange for the tip, the judge decided not to reveal the name of the informer to Lewis. The judge's decision was clearly right. The confidentiality of informers serves an important law-enforcement interest, especially in "victimless" crimes such as tax evasion. This interest must be balanced against the defendant's interest in developing an effective defense. See Roviaro v. United States, 353 U.S. 53, 62, 77 S.Ct. 623, 628, 1 L.Ed.2d 639 (1957). Where the informer is a mere "tipster," disclosure of his identity will rarely be appropriate under the balancing test of Roviaro. Suarez v. United States, 582 F.2d 1007, 1011 (5th Cir. 1978), says it is never appropriate. The mere tipster plays a potentially important role in uncovering tax evasion yet only a small role in the actual prosecution; hence the balance tips against disclosure.

Since the informer here was merely a tipster, we might stop with a citation to Suarez. But we need not go so far as to adopt the Fifth Circuit's automatic rule protecting the confidentiality of tipsters' identities in all circumstances in order to reject Lewis's claim. The informer here, whoever he was, was not a key witness; the information that he supplied to the IRS was not even important enough to be incorporated in any of the IRS agents' reports. The informer's identity became particularly unimportant as the trial progressed and it became clear that the only real issue in the case was whether Lewis truly believed that he did not have to file a return unless he had the funds in hand to pay in full any taxes shown on the return to be due. There was no direct evidence on this point other than Lewis's own testimony, which the jury had to weigh against a circumstantial background that included the fact that Lewis, despite his limited education, was an experienced businessman operating on a substantial scale. Knowing that some peripheral witness may have been an informer would not have helped Lewis to make out his defense.

We come to the major issue in the case, the adequacy of the instructions. The judge instructed the jury that "An act is done 'willfully' if done voluntarily and intentionally with the purpose of avoiding a known legal duty." This instruction allowed the jury to acquit if it believed Lewis's story that he had not known that he could, let alone that he had...