and Submitted June 15, 2016 San Francisco, California
from the United States District Court No. 2:09-cr-00008-LKK-1
for the Eastern District of California Lawrence K. Karlton,
District Judge, Presiding
R. Hurley (argued) and Eduardo G. Roy, Prometheus Partners
LLP, San Francisco, California, for Defendant-Appellant.
Christopher Hales (argued) and Matthew D. Segal, Assistant
United States Attorneys; Camil A. Skipper, Appellate Chief;
United States Attorney's Office, Sacramento, California;
Before: J. Clifford Wallace, Mary M. Schroeder, and John B.
Owens, Circuit Judges.
panel affirmed the district court in all respects in a case
in which the defendant was convicted of tax related charges,
including tax evasion.
panel held that neither the district court nor the jury erred
in concluding that the defendant's monthly income from
his law practice qualified as "salary or wages"
under 26 U.S.C. § 6331(e), and therefore rejected the
defendant's contention that the government could not
prove concealment of property subject to a levy, as required
for conviction under 26 U.S.C. § 7206(4).
the defendant's contention that the district court erred
in dismissing the levy counts because they exceeded the
three-year statute of limitations, the panel held that the
six-year statute of limitations of 26 U.S.C. § 6531(1),
covering tax offenses "involving the defrauding or
attempting to defraud" the government, applies to
prosecutions under § 7206(4).
panel held that the district court properly rejected the
defendant's argument that res judicata precludes the
government from pursuing a criminal action concerning his
debts that were already discharged in bankruptcy. The panel
held res judicata cannot apply because the IRS in a
bankruptcy action and the United States government in a
criminal action are not in privity.
panel resolved several of the defendant's arguments in a
concurrently-filed memorandum disposition.
Donald Wanland, Jr. appeals from his jury convictions and
sentence for tax related charges, including tax evasion.
Although Wanland raises many arguments challenging his
convictions and sentence, none has merit, so we affirm the
district court in all respects.
was a successful civil attorney in Sacramento, California,
and his law practice generated considerable income. In the
1990s, he entered into two partnership agreements with
Richard Bernstein-the Law Offices of Wanland and Bernstein
(from which Wanland drew his income) and 705 University
Partners (which held the real estate at 705 University
Avenue, the partnership's law office). Wanland received
75% of the profits, while Bernstein received 25% of the
profits, in scheduled monthly draws. More specifically,
partners were entitled to "withdraw from the partnership
funds in equal monthly installments an amount equal to
four-fifths of his distributive share of partnership net
profits for the preceding year." 705 University Partners
had its own bank account ("705 Account"), which
Wanland used as both his business and personal
disputes with the Internal Revenue Service ("IRS")
began in the 1990s, and they continued into the new
millennium. For tax years 2000-2003, Wanland filed personal
tax returns reporting many hundreds of thousands of dollars
of income, and owing around $450, 000 in taxes. Wanland never
paid these taxes, and then stopped filing personal tax
returns altogether. His law partnership continued to file
returns showing income of around $300, 000 each year.
several failed attempts to resolve his tax deficiencies, an
IRS Officer was assigned to Wanland's case. Following
some initial correspondence, the officer sent a Collection
Information Statement (IRS Form 433A) to Wanland's
personal accountant to complete. Form 433A discloses an
individual's income, expenses, assets, accounts, and
liabilities so the IRS can assess an individual's ability
to pay outstanding taxes.
November 2003, Wanland completed, signed, and submitted the
Form 433A. He listed only one bank account with a balance of
$9. He did not list the 705 Account, even though, in the
previous month alone, he had deposited $35, 000 from his law
practice into and spent over $18, 000 from the 705 Account.
He also did not list his American Express card, even though
he had used roughly $15, 000 from the 705 Account in October
and November to pay down its balance. He also never disclosed
the 705 Account to his accountants, who would have told
Wanland that he needed to disclose it on the Form 433A.
April 2004, the IRS reassigned Wanland's case to a
different IRS Officer, who concluded that Wanland had the
ability to pay his tax liabilities, penalties, and interest.
In May 2004, she met with Wanland and his accountant, and
Wanland promised to pay $10, 000 per month towards his
outstanding tax balance, and to get a loan to obtain more
funds. He never got the loan, and stopped making payments
after four months.
April 2005, Wanland provided an updated Form 433A, which
reported the same account as the previous Form 433A, this
time with an account balance of "minimal/unknown."
He again omitted the 705 Account, even though he had
deposited $20, 000 into it just a few days earlier. The IRS
Officer, suspicious that Wanland had been hiding accounts,
issued a summons to Wanland's bank around the same time.
She then learned about the 705 Account, and issued levies on
both partnerships-the Law Offices of Wanland and Bernstein
and 705 University Partners. The levies stated:
This levy requires you to turn over to us: this
taxpayer's wages and salary that have been earned but not
paid, as well as wages and salary earned in the future until
this levy is released, and (2) this taxpayer's other