United States v. Zitron

• Decision Date: 21 January 2016
• Docket Number: No. 14–10009.,14–10009.
• Citation: 810 F.3d 1253
• Court: U.S. Court of Appeals — Eleventh Circuit
• Parties: UNITED STATES of America, Plaintiff–Appellee, v. Harvey ZITRON, Defendant–Appellant.

810 F.3d 1253

UNITED STATES of America, Plaintiff–Appellee,

v.Harvey ZITRON, Defendant–Appellant.

No. 14–10009.

United States Court of Appeals, Eleventh Circuit.

Jan. 21, 2016.

Frank Phillip Cihlar, Gregory Victor Davis, Gregory S. Knapp, Kevin C. Lombardi, Joseph Brian Syverson, U.S. Department of Justice, Washington, DC, Wifredo A. Ferrer, Kathleen Mary Salyer, U.S. Attorney's Office, Miami, FL, Harry C. Wallace, Jr., U.S. Attorney's Office, Fort Lauderdale, FL, for Plaintiff–Appellee.

John E. Bergendahl, Law Offices of John E. Bergendahl, Miami, FL, for Defendant–Appellant.

Before ED CARNES, Chief Judge, MARTIN, Circuit Judge, and WALTER,^* District Judge.

PER CURIAM:

After a five-day jury trial, Harvey Zitron was convicted of five counts of filing false tax returns, three counts of using an unauthorized access device, and two counts of aggravated identity theft. He challenges his convictions and sentence.

I.

Zitron operated a company called Millennium Republic that sold chemical products. In 2002, he suggested to one of Millennium's employees, Cynthia Gentner, that she take over the company. She agreed. Gentner operated the business under the names of two corporations that she formed, Cyn–Lex and Granite Industries. Despite the apparent change in ownership, Gentner testified that she still "did everything [Zitron] asked [her] to do." From 2002 to 2003, at Zitron's behest, Gentner deposited company checks into her personal account, took out cash, and gave that cash to Zitron.¹

Zitron came up with another check-cashing scheme in 2003. He instructed Gentner to write checks from Cyn–Lex and Granite Industries to a man named "Charles Sohrabel." "Charles Sohrabel" was the alias of Zitron's friend, Charles Schnabel.² Gentner agreed, even though she knew that "Charles Sohrabel" was Schnabel's alias and that Schnabel did not work for either company. Zitron then told Gentner and Schnabel to go to a convenience store that offered a check-cashing service. Schnabel initially cashed the checks in person, but he later called the storeowner and told him that Gentner was authorized to cash the checks on his behalf.³

Between January 2003 and December 2005, Gentner cashed 265 checks for Zitron at that store, totaling $2,566,981.60. Gentner then gave that cash to Zitron. The scheme ended after the storeowner told Gentner that he would not cash any more checks unless Schnabel accompanied her and provided valid identification (which he never did).

Zitron did not report a penny of that $2,566,981.60 on his income tax filings, even though it was taxable income (according to the government's tax expert who testified at trial). Instead, on income tax forms that he filed for 2003, 2004, and 2005, he reported negative amounts of adjusted gross income. But during those years, he deposited a total of $820,513.75 in cash into several bank accounts: $425,728.00 into an account held in his own name; $202,277.00 into a joint checking account he owned with a friend; and $192,508.75 into an account he controlled but held in his son Jordan's name (even though Jordan barely remembered opening it and never put any of his own money into it).

Zitron not only failed to report any of the income from his check scheme, he also misused his ex-wife's and son's names and social security numbers to obtain credit cards: one in his ex-wife's name in 2006, and two in his son's name in 2009. He did not have their permission to use their personal identifying information in that way. They discovered the existence of the credit cards only after Zitron had racked up substantial amounts of debt on them.

Zitron was initially charged with two counts of filing false tax returns. The government eventually added more charges, bringing the total to five counts of filing false tax returns, in violation of 26 U.S.C. § 7206(1), three counts of using an unauthorized access device, in violation of 18 U.S.C. § 1029(a)(2), and two counts of aggravated identity theft, in violation of 18 U.S.C. § 1028A(a)(1). Zitron moved to sever the tax counts from the access device and identity theft counts, but the district court denied the motion. After a five-day trial, the jury found Zitron guilty on all counts, and the court sentenced him to 81 months in prison. This is his appeal.

II.

Zitron contends that the tax counts were improperly joined with the access device and identity theft counts under Federal Rule of Criminal Procedure 8(a).⁴ Alternatively, he contends that even if joinder was proper, the tax counts should have been severed from the others under Rule 14(a) because of the joinder's prejudicial effect on him.⁵

We will reverse a conviction based on improper joinder under Rule 8(a) only if it "affects substantial rights and ... results in actual prejudice because it had substantial and injurious effect or influence in determining the jury's verdict."

United States v. Watson, 866 F.2d 381, 385 (11th Cir.1989) (alteration in original) (quotation marks omitted). Similarly, we will reverse a conviction based on the district court's refusal to sever counts under Rule 14(a) only if the defendant "received an unfair trial and suffered compelling prejudice." United States v. Walser, 3 F.3d 380, 386 (11th Cir.1993) (quotation marks omitted).

Zitron argues that the trial of the access device and identity theft counts with the tax counts together was prejudicial because it allowed the government to present evidence that he furtively used his family members' personal identifying information for his own financial advantage and the jury may not have been able to consider the evidence of the different crimes separately. The evidence of the family-related credit card crimes, he asserts, left the jury confused, hostile toward him, and more likely to convict him on the tax counts. We are not persuaded.

Zitron has not shown that he suffered actual prejudice that affected his substantial rights, as would be necessary to find reversible error under Rule 8(a). There is nothing in the record indicating that the jury was confused, hostile, or more likely to convict on the tax counts because of the evidence of the other crimes. See Watson, 866 F.2d at 385–86. The evidence presented to convict him on the identity theft and access device counts would have been admissible against him in a separate trial on the tax counts. See id.

Zitron also has not shown that he suffered compelling prejudice from the joinder of the claims, as would be required under Rule 14(a) in order to find that the district court abused its discretion in refusing to sever the tax counts from the other counts. The evidence was sufficient to convict Zitron on all of the counts. Cf. Walser, 3 F.3d at 387 (concluding that a defendant did not suffer compelling prejudice partly because "the evidence as to each count fully supported a finding of guilt"). Finally, the court instructed the jury that each count "charg[ed] a separate crime," that it "must consider each crime and the evidence relating to it separately," and that its finding of guilty or not guilty on one count "must not affect [its] verdict for any other crime." See United States v. Pierce, 733 F.2d 1474, 1477–78 (11th Cir.1984) (finding no prejudice because the district court "properly instructed the jury" on how to use the evidence and because the government presented sufficient evidence to convict the defendant). And "[a]fter all, we must presume that juries follow their instructions." Johnson v. Breeden, 280 F.3d 1308, 1319 (11th Cir.2002). The instructions cured any error in trying the counts together. Cf. United States v. Barsoum, 763 F.3d 1321, 1337–38 (11th Cir.2014) (noting that the district court "properly instructed the jury to consider each count separately" in finding that it did not abuse its discretion in denying a motion to sever); Walser, 3 F.3d at 387 ("[I]f the possible prejudice may be cured by a cautionary instruction severance is not required.").

Because Zitron has not shown actual prejudice, we will not reverse for improper joinder under Rule 8(a). He has also not shown compelling prejudice, and we will not reverse for failure to sever under Rule 14(a).

III.

Zitron next contends that two statements made by the government's tax expert during his testimony violated his Fifth Amendment right to remain silent and also improperly shifted the government's burden of proof.

One of those statements was made on Zitron's cross-examination of the witness.

Defense counsel asked him: "[I]f the cash that was deposited into the ... joint account and the Jordan Zitron joint account didn't come from the Charles Sohrabel checks, that would also change your expert opinion, correct?" The witness replied that if the cash "didn't come from the Sohrabel checks, usually I would ask the question, well, where is this money coming from? And if the defendant can explain it—cannot explain it, it still would be income unless he can say otherwise."

The other statement was made on the government's re-direct examination of that witness. The prosecutor asked him if there was any indication during trial that Zitron "disclosed to his CPA the cash deposits to his bank accounts." The witness replied: "Nothing as far as I heard in this trial has shown that the CPA—you know, that the taxpayer disclosed the cash deposits in the bank, in his own bank account that he was aware of."

A.

A witness impermissibly comments on a defendant's right to remain silent if the "remark was of such a character that the jury would naturally and necessarily take it to be a comment on the defendant's silence." United States v. Guerra, 293 F.3d 1279, 1289 (11th Cir.2002) (quotation marks omitted). To determine the "natural and necessary effect of allegedly impermissible comments, we must examine the comments in the context within which they were made." Williams v. Wainwright, 673 F.2d 1182, 1184 (11th Cir.1982).

The witness, in one of his answers, did raise the question of whether the defendant could explain where the money came from,...