Tax evasion; Good-faith defense; harmless error

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Tax evasion
Good-faith defense; harmless error

It was error for the district court to require a defendant to testify in order to assert a good-faith defense to tax charges, but the error was harmless.

“The court erred in thinking that evidence of Kokenis’s state of mind had to come from Kokenis’s own testimony. See, e.g., United States v. Lindo, 18 F.3d 353, 356 (6th Cir. 1994) (‘“[T]he standard of evidence necessary to warrant a [good-faith reliance] instruction cannot include an absolute requirement that the taxpayer must testify, for that would burden the taxpayer’s own Fifth Amendment right against self-incrimination.”’) (quoting United States v. Duncan, 850 F.2d 1104, 1115 n.9 (6th Cir. 1988)); United States v. Phillips, 217 F.2d 435, 442 (7th Cir. 1954) (noting that evidence of defendant’s good-faith reliance on advice of counsel can come from the government’s witnesses or the defendant’s witnesses). Although a defendant’s own testimony might be the best evidence of that defendant’s good faith, a defendant can offer evidence of good faith in other ways. For example, circumstantial evidence may tend to show good faith and hearsay statements of the defendant may suggest a defendant’s belief.”

“Nonetheless, Kokenis was not entitled to a good-faith instruction. First, the evidence did not support this theory of good faith. Kokenis’s claim that the district court wouldn’t allow him to present evidence of good faith unless he testified is wrong. He simply didn’t offer any evidence relevant to his good faith. For example, Kokenis wanted to present evidence of the pool of capital theory and Delta Energy’s obligations to landowners and working interest owners. He argues that this evidence ‘would have provided a layer of credibility to [his] argument that he did not act willfully when he proposed to Mondero that the sales transactions not be reported as income[.]’ But Kokenis made no effort to tie such evidence to his state of mind. He offers nothing but speculation to suggest that he relied on such information in directing Mondero to change records and tax returns. Kokenis seems to be asserting that just because there may be evidence to show that someone could have had a good-faith belief that he wasn’t violating the law, then he should be able to present such evidence to the jury. Not so. Without any connection to his state of mind, such evidence is irrelevant.”

Affirmed.

11-1426 U.S. v. Kokenis

Appeal from the United States District Court for the Northern District of Illinois, Shadur, J., Tinder, J.

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