United States v. Sanchez
| Decision Date | 08 February 2023 |
| Docket Number | 1:21-cr-00238-BLW |
| Parties | UNITED STATES OF AMERICA, Plaintiff, v. ANDRES SANCHEZ, Defendant. |
| Court | U.S. District Court — District of Idaho |
B Lynn Winmill U.S. District Court Judge
Before the Court are four motions filed by the Government regarding the admissibility of certain evidence during the upcoming trial. (Dkts. 13, 18, 19, 33). Defendant opposes, at least in part, the Government motions: (1) Motion to Admit Prior Act Evidence Pursuant to 404(b) (Dkt. 13); (2) Motion to Exclude Evidence and Argument of Allegedly Non-Fraudulent Transactions (Dkt. 18); and (3) Motion to Introduce Expert PowerPoint Presentation and to Allow Expert Witness to Remain in Court Room (Dkt. 33). Defendant does not contest the Government's Motion in Limine to Exclude Evidence and Argument of Selective Prosecution (Dkt. 19). For the reasons discussed below, the Court will grant the Government's unopposed motion and grant in part and deny in part the Government's contested motions.
Defendant Andres Sanchez, is a tax preparer who was indicted on eight counts of aiding and assisting in the preparation and presentation of false and fraudulent tax returns in violation of 26 U.S.C. § 7206(2). Dkt. 1. The charges against Mr Sanchez relate to his work at Fiesta Pro Services (“FPS”), a tax preparation business located in Boise, Idaho, which employed Sanchez and multiple other tax preparers.
In 2016, The Internal Revenue Service Criminal Investigations (IRS-CI) began investigating FPS after the IRS Scheme Development Center (“SDC”) conducted a statistical analysis of the tax returns prepared by FPS and observed a high rate of refund percentages. After IRS-CI agents executed a federal search warrant at FPS, IRS-CI began locating and interviewing taxpayers. Eventually, the Government filed an eight-count indictment. Counts One through Seven charge Sanchez with committing tax preparer fraud on seven tax returns involving four separate taxpayers. See id. Count One involves I.S. and S.C.'s (husband and wife) 2015 return; Counts Two through Four involve J.C.'s 2014, 2015, and 2016 returns; Counts Five and Six involve Y.H.'s 2015 and 2016 returns; and Count Seven involves S.C.'s 2015 return. Id. Count Eight of the Indictment stems from the undercover operation that took place in March of 2017. This case is currently set for trial on February 13, 2023.
“Motions in limine are well-established devices that streamline trials and settle evidentiary disputes in advance, so that trials are not interrupted mid-course for the consideration of lengthy and complex evidentiary issues.” United States v. Tokash, 282 F.3d 962, 968 (7th Cir. 2002). Accordingly, “a ruling on a motion in limine is essentially a preliminary opinion that falls entirely within the discretion of the district court.” City of Pomona v. SQM N. Am. Corp., 866 F.3d 1060, 1070 (9th Cir. 2017); see also Luce v. United States, 469 U.S. 38, 41 n.4 (1984). Further, rulings on motions in limine are provisional and, therefore, “not binding on the trial judge [who] may always change his mind during the course of a trial.” Ohler v. United States, 529 U.S. 753, 758 n.3 (2000). Thus, at trial, the court will entertain objections on individual proffers as they arise at trial, even though the proffer falls within the scope of a denied motion in limine. See Luce, 469 U.S. 38 at 41 (“Indeed, even if nothing unexpected happens at trial, the district judge is free, in the exercise of sound judicial discretion, to alter a previous in limine ruling.”).
Through its first evidentiary motion, the Government seeks to admit “other acts” evidence, including uncharged tax returns allegedly prepared by Sanchez and a statistical analysis performed by the IRS Scheme Development Center. See Gov.'s Brief at 1, Dkt. 13.
Federal Rule of Evidence 404(b)(1) prohibits using so-called “other act” evidence evidence of crimes, wrongs, or other acts “to prove a person's character in order to show that on a particular occasion the person acted in accordance with the character.” Fed.R.Evid. 404(b)(1). But other acts evidence may be admissible for other purposes, “such as proving motive, opportunity, intent, preparation, plan, knowledge, identity, absence of mistake, or lack of accident.” Fed.R.Evid. 404(b)(2).
The Ninth Circuit applies a four-part test to determine whether evidence is admissible under Rule 404(b). “Such evidence may be admitted if: (1) the evidence tends to prove a material point; (2) the other act is not too remote in time; (3) the evidence is sufficient to support a finding that defendant committed the other act; and (4) (in certain cases) the act is similar to the offense charged.” United States v. Bailey, 696 F.3d 794, 799 (9th Cir. 2012) (internal citation omitted). “The government has the burden of proving that the evidence meets all of the above requirements.” Id. (internal citation and quotation omitted). The Court must exclude evidence that meets this test if the prejudicial impact substantially outweighs the probative value. Id.
However, evidence of other acts that “is ‘inextricably intertwined' with the charged offense,” is not subject to Rule 404(b) analysis, regardless of whether it can meet the test for admissibility. United States v. Wells, 877 F.3d 1099, 1127 (9th Cir. 2017) (quoting United States v. Beckman, 298 F.3d 788, 793 (9th Cir. 2002)). “This exception applies when (1) particular acts of the defendant are part of a single criminal transaction, or when (2) ‘other act' evidence is necessary to admit in order to permit the prosecutor to offer a coherent and comprehensible story regarding the commission of the crime.” Id. (quoting Beckman, 298 F.3d at 794) (cleaned up).
The Government seeks to introduce four uncharged tax returns. See Gov.'s Reply at 2, Dkt. 30.[1] Specifically, the Government intends to introduce I.S. and S.S.'s 2013 and 2014 returns, J.C.'s 2013 return, and A.S.'s 2013 return. Id. Of the four uncharged tax returns, three of the tax returns involve one of the taxpayers included in the Indictment. Id. The remaining uncharged tax return, A.S.'s 2013 return, is not related to any charged tax returns, but the Government alleges that it similarly involves claiming ineligible dependents.
The Government argues that the four uncharged tax returns are admissible without needing to conduct a Rule 404(b) analysis because they are inextricably intertwined with the charged conduct. See Gov.'s Brief at 1, Dkt. 13. Alternatively, the Government argues that the uncharged tax returns are admissible even if a Rule 404(b) analysis applies because the evidence is relevant to intent, knowledge, absence of mistake, and lack of accident. See id. at 2. Sanchez disputes both arguments, instead claiming that there is insufficient evidence that he committed the “other acts.” See Def.'s Response at 3, Dkt. 26.
a. The Uncharged Tax Returns are subject to a 404(b) analysis
As a threshold matter, the Court must determine whether the uncharged tax returns are “inextricably intertwined” with the charges. The Government argues that the uncharged tax returns are inextricably intertwined because they are both “part of a single criminal transaction” and “offer a coherent and comprehensible story regarding the commission of the crime.” Gov.'s Brief at 1, Dkt. 13. The Court is not persuaded.
First, the uncharged tax returns are not part of a single criminal transaction. Each charge in the Indictment involves only those tax returns directly at issue in each count. The uncharged tax returns are not necessary to establish any element of the charged crime, nor can they be considered a part of a single transaction. See, e.g., United States v. Uvari, No. 218CR00253APGNJK, 2022 WL 783029, at *2 (D. Nev. Mar. 15, 2022) ().
Second, the uncharged tax returns are not necessary for the Government to offer a “coherent and comprehensible story regarding the commission of the crime.” Wells, 877 F.3d at 1127. After reviewing the alleged Grand Jury testimony offered by the Government regarding the charged tax returns, the Court is not persuaded that the uncharged tax returns are integral for the jury to understand the Government's theory as to the charged tax returns. See Gov.'s Brief at 3-4, Dkt. 13.
This is particularly true regarding A.S.'s 2013 uncharged tax return. To the best of the Court's knowledge, none of the charged tax returns involve Sanchez allegedly providing a false social security number for a dependent, nor are there any charges in the Indictment that relate to A.S.'s tax returns. See United States v. Wells, 879 F.3d 900, 928-29 (9th Cir. 2018) (“In determining whether particular evidence is necessary to the prosecution's ‘coherent and comprehensible story,' we ask whether the evidence bears directly on the charged crime.”) (quoting United States v. Dorsey, 677 F.3d 944, 952 (9th Cir. 2012)).
In an attempt to support its contention that the uncharged tax returns are necessary to establish a clear and comprehensible story regarding the charged tax returns, the Government relies on United States v. Shabazz, 887 F.3d 1204 1217 (11th Cir. 2018). See Gov.'s Brief, Dkt 13, at 8. However, in Shabazz, the government charged the defendant with conspiracy to defraud the United States via a tax fraud scheme. Id. (...
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