U.S. v. Workinger

• Decision Date: 23 July 1996
• Docket Number: No. 95-30200,95-30200
• Citation: 90 F.3d 1409
• Parties: -5710, 96-2 USTC P 50,402, 44 Fed. R. Evid. Serv. 944, 96 Cal. Daily Op. Serv. 5423, 96 Daily Journal D.A.R. 8827 UNITED STATES of America, Plaintiff-Appellee, v. William Lee WORKINGER, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1409

90 F.3d 1409

78 A.F.T.R.2d 96-5710, 96-2 USTC P 50,402,

44 Fed. R. Evid. Serv. 944,

96 Cal. Daily Op. Serv. 5423,

96 Daily Journal D.A.R. 8827

UNITED STATES of America, Plaintiff-Appellee, v. William Lee WORKINGER, Defendant-Appellant.

No. 95-30200.

United States Court of Appeals Ninth Circuit.

Argued and Submitted March 8, 1996.

Decided July 23, 1996.

Robert E. Lindsay and Alan Hechtkopf, United States Department of Justice, Tax Division, and Scott A. Schumacher, United States Department of Justice, Criminal Appeals and Tax Enforcement Policy Section, Tax Division, Washington, D.C., William Fitzgerald and Christopher L. Cardani, Assistant United States Attorneys, Eugene, Oregon, for plaintiff-appellee.

Joseph Wetzel, Wetzel and DeFrang, Portland, Oregon, for defendant-appellant.

Appeal from the United States District Court for the District of Oregon, Michael R. Hogan, District Judge, Presiding. D.C. No. CR-94-600023-MRH.

Before: REINHARDT, KOZINSKI and FERNANDEZ, Circuit Judges.

Opinion by Judge FERNANDEZ; Partial Concurrence by Judge KOZINSKI.

FERNANDEZ, Circuit Judge:

William Lee Workinger appeals his conviction for willfully failing to pay taxes in violation of 26 U.S.C. § 7203, willfully filing a false income tax return in violation of 26 U.S.C. § 7206(1), and corruptly obstructing and impeding the due administration of the Internal Revenue laws in violation of 26 U.S.C. § 7212(a). We affirm.

BACKGROUND

On March 23, 1994, Workinger, a dentist licensed to practice in Oregon, was indicted for his participation in an elaborate scheme to conceal his income and assets from the Internal Revenue Service. The heart of his scheme consisted of creating and using various entities to hide income, purposely misstating his income, filing forms which substantially underreported the value and quantity of his financial resources and holdings, and diverting his practice income to his spouse. Among other things, the government accused Workinger of maintaining numerous unreported bank accounts holding substantial unreported funds, depositing business receipts into bank accounts that he had not listed on IRS forms, and failing to disclose real estate which he controlled. The government also alleged that he had misled federal investigators by showing a rental agreement form to prove that he rented a home which he actually owned and by filing false statements of financial condition.

Workinger was indicted in five counts for attempting to evade payment of federal income tax for 1980, 1981, 1983, 1984 and 1985 (Counts 1, 2, 3, 4, and 5 respectively). He was also indicted for making and subscribing his 1987 federal income tax return on which he understated his total income (Count 6). Finally, he was indicted for corruptly obstructing and impeding the due administration of the internal revenue laws by submitting inaccurate financial forms to IRS collection officers on three separate occasions--once on February 17, 1988, and twice on March 29, 1989 (Count 7). Workinger claims that prosecution on the latter count was barred by the statute of limitations.

In 1991, before the indictment issued, Workinger had been interviewed by Donald Johnson, a lawyer representing Workinger's former wife. Although no court reporter was present, Workinger affirmed that he would tell the truth and the conversation was tape-recorded. Mr. Johnson's secretary, who was not present at the interview, then typed a transcription of the conversation. The transcriptions included handwritten notations, numerous interruptions and sections omitted as "inaudible." At trial, the transcript of that interview was received by the court and read verbatim to the jury. By that time, the tapes had been erased. Workinger asserts that the transcript should not have been admitted because it was not the best evidence, was not properly authenticated, and was hearsay.

In the course of the trial, the prosecution called Revenue Agent June Brock to testify as an expert witness. Ms. Brock testified in support of the government's charge that Workinger signed a false 1040 form for 1987 which he did not believe to be correct. Brock testified that $7,855.55 was omitted income "because it was a discount." She further testified that $8,625 was omitted income because the government found that an asset sold by Workinger had no basis in his hands. Workinger claims that this testimony was false.

On January 25, 1995, Workinger was convicted as charged on Counts 6 and 7. On Counts 1 through 5, he was convicted of the lesser included offense of willful failure to pay income taxes. He appealed.

JURISDICTION AND STANDARD OF REVIEW

The district court had jurisdiction pursuant to 18 U.S.C. § 3231. We have jurisdiction pursuant to 28 U.S.C. § 1291.

The district court's conclusion regarding the applicability of a statute of limitations is a matter of law reviewed de novo. United States v. Manning, 56 F.3d 1188, 1195 (9th Cir.1995). In construing a statute, our court's objective "is to ascertain the congressional intent and give effect to the legislative will." Philbrook v. Glodgett, 421 U.S. 707, 713, 95 S.Ct. 1893, 1898, 44 L.Ed.2d 525 (1975). This court must first determine whether the plain language makes its meaning reasonably clear. Negonsott v. Samuels, 507 U.S. 99, 104-05, 113 S.Ct. 1119, 1122-23, 122 L.Ed.2d 457 (1993). If it is clear, that is the end of the inquiry. See Sullivan v. Stroop, 496 U.S. 478, 482, 110 S.Ct. 2499, 2502, 110 L.Ed.2d 438 (1990). "In ascertaining the plain meaning of the statute, [we] must look to the particular statutory language at issue, as well as the language and design of the statute as a whole." K-Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291, 108 S.Ct. 1811, 1818, 100 L.Ed.2d 313 (1988).

A district court's evidentiary rulings are reviewed for an abuse of discretion. Manning, 56 F.3d at 1196. "Evidentiary rulings will be reversed for abuse of discretion only if such nonconstitutional error more likely than not affected the verdict." United States v. Corona, 34 F.3d 876, 882 (9th Cir.1994).

DISCUSSION

I. Statute of Limitations

When the indictment was filed on March 23, 1994, Count 7 charged that Workinger "did corruptly obstruct and impede, and endeavor to obstruct and impede the due administration of the internal revenue Laws of the United States .... in violation of Title 26, United States Code, Section 7212(a)." More specifically, it charged that Workinger had submitted a false document on February 17, 1988, and two false documents on March 29, 1989, for those very purposes. Workinger contended that because the filing of the indictment took place more than three years after the incidents in question, the indictment was barred by the three-year statute of limitations. 26 U.S.C. § 6531. ¹ The district court disagreed and applied, instead, the six-year statute of limitations. § 6531(1) and (6).

The statute of limitations does provide that, in general, criminal tax proceedings must be initiated within three years of the offense. It then provides eight exceptions for which the statute of limitations is six years. One of those exceptions establishes a six-year limitations period "for offenses involving the defrauding or attempting to defraud the United States ... in any manner." § 6531(1). Another exception establishes a six-year limitations period "for the offense described in Section 7212(a) (relating to intimidation of officers and employees of the United States)." § 6531(6). Section 7212(a) provides criminal penalties for the following:

Corrupt or forcible interference.--Whoever corruptly or by force or threats of force ... endeavors to intimidate or impede any officer or employee of the United States acting in an official capacity under this tile, or in any other way corruptly or by force or threats of force ... obstructs or impedes, or endeavors to obstruct or impede, the due administration of this title....

Thus, § 7212(a) provides punishment for those who endeavor to obstruct or impede the administration of Title 26. It also provides punishment for those who endeavor to intimidate or impede an employee who is acting in his official capacity under that title.

Because he was charged with corruptly obstructing or impeding the due administration of the Internal Revenue laws, Workinger urges that the six-year provision does not apply to him. Workinger first argues that the district court erred by applying § 6531(1). He contends that § 6531(1) only applies to defendants expressly charged with defrauding the United States. Workinger avers that § 6531(1) cannot apply to one who has only impeded or obstructed the internal revenue laws because to impede or obstruct does not necessarily require the defendant to defraud the United States. He then asserts that § 6531(6) does not apply to him because the parenthetical language of § 6531(6) limits the scope of the six-year limitations exception to those § 7212(a) offenses involving the intimidation of officers and employees of the United States. He argues that, because he was indicted only for impeding the internal revenue laws, his § 7212(a) offense falls outside of the scope of the § 6531(6) exception.

The district court rejected both of Workinger's contentions. The court first interpreted the parenthetical language in § 6531(6) to be descriptive rather than limiting, and, therefore, applied a six-year statute of limitations to Workinger's claims. In the alternative, the court found that "the alleged violation of 26 U.S.C. § 7212(a) ... involves an attempt to defraud" and therefore applied the six-year limitations period set forth in § 6531(1). While, as we will explain, we disagree with the district court regarding the direct application of § 6531(1) to this case, we do agree that it must inform our determination that § 6531(6) does apply.

Section 6531(1), by its own terms, does not require that a defendant be expressly indicted for tax fraud. Indeed, a reading which so limited...