Justia U.S. 1st Circuit Court of Appeals Opinion Summaries

George Schussel’s former company fraudulently transferred millions of dollars to him in order to avoid paying income taxes. The IRS, which is authorized by statute to collect a person’s tax debt by reclaiming assets the debtor has transferred to someone else, claimed that Schussel was liable as a transferee for the company’s tax deficiencies. The United States Tax Court held Schussel liable for the company’s back taxes of over $4.9 million plus interest of at least $8.7 million. Schussel appealed, disputing the amount he owed the IRS as a result of the fraudulent transfers. The First Circuit reversed in part and affirmed in part, holding (1) the tax court erred in calculating prejudgment interest on the fraudulently transferred funds under the federal tax interest statute rather than assessing the prejudgment interest at the Massachusetts rate; (2) the tax court did not err in accepting as a proper measure of the assets Schussel received the actual amount transferred from the company into Schussel-controlled accounts; and (3) Schussel’s loans to the company to pay Schussel’s litigation expenses did not reduce the net amount transferred to him. View "Schussel v. Werfel" on Justia Law

After a jury trial, Defendants, Catherine Floyd and William Dion, were convicted of conspiracy to defraud the United States of payroll and income taxes and endeavoring to obstruct and impede the Internal Revenue Service (IRS). The First Circuit Court of Appeals affirmed, holding (1) there was sufficient evidence to support the convictions; (2) the district court did not err in failing to suppress certain evidence; (3) the district court did not err in denying Defendants’ motions for severance and in trying Defendants jointly with their coconspirator; (4) Defendants’ claim that the IRS’s failure to comply with the Federal Register Act engendered dismissal of some of the charges was without merit; and (5) the district court did not err in sentencing Dion. View "United States v. Dion" on Justia Law

After losing his job as a stockbroker and financial advisor and his accompanying health insurance, Appellant applied for and received subsidized health insurance for several years. Russell represented on each application that he had no income to report and was unemployed, but Appellant was working under the table during those years. After a government investigation and an ensuing jury trial, Appellant was convicted of making false statements in connection with the payment of health care benefits. The First Circuit Court of Appeals affirmed, holding (1) the jury instruction on the definition of willfulness was not error; (2) the government presented sufficient evidence that Appellant's false statements were material to support the conviction; (3) the district court did not err in excluding certain testimony as state-of-mind hearsay; and (4) neither the prosecutor's statements during closing arguments nor his questions in eliciting testimony from a witness necessitated reversal. View "United States v. Russell" on Justia Law

After a jury trial, Defendants Salvatore DiMasi, the former Speaker of the Massachusetts House of Representatives, and Richard McDonough, a lobbyist, were convicted of several crimes, including honest-services fraud and conspiracy to commit honest-services fraud, resulting from a scheme to funnel money to DiMasi in exchange for political favors. The district court sentenced DiMasi to ninety-six months' imprisonment and McDonough to eight-four months' imprisonment. The First Circuit Court of Appeals affirmed the convictions and sentences, holding (1) the evidence was sufficient to support Defendants' convictions; (2) the trial court did not prejudicially err in instructing the jury; (3) the trial court did not err in its challenged evidentiary rulings; and (4) the trial court did not err in sentencing Defendants. View "United States v. McDonough" on Justia Law

Defendants in this case were a Puerto Rico legislator and a Commonwealth businessman who were charged with unlawfully exchanging favorable action on legislation for a trip to Las Vegas to attend a prize fight. After a jury trial, Defendants were convicted of, inter alia, federal program bribery in violation of 18 U.S.C. 666. Defendants appealed, contending, among other issues, that the district court erred in instructing the jury to find guilt on the section 666 counts based on a gratuity theory rather than a bribery theory. The First Circuit Court of appeals (1) vacated Defendants' section 666 convictions, holding that because section 666 does not criminalize gratuities in addition to bribes, the district court erred in its instructions; and (2) directed the district court to enter a judgment of acquittal on Defendants' conspiracy charges, holding that the Double Jeopardy Clause entitled both men to acquittal on their respective conspiracy charges. View "United States v. Bravo-Fernandez" on Justia Law

After a jury trial, Appellant was convicted of seventeen counts of mail fraud, wire fraud, bank fraud, and aggravated identity theft. Appellant appealed, arguing (1) the trial court violated his Sixth Amendment right to confront the witnesses against him by admitting testimony of a forensic examiner about another examiner's prior examination; and (2) the evidence was insufficient to support his aggravated identity theft convictions. The First Circuit Court of Appeals upheld Appellant's convictions on all counts, holding (1) the evidence was sufficient to allow a reasonable jury to conclude beyond a reasonable doubt that Appellant was guilty of aggravated identity theft; and (2) the district court did not plainly err in admitting the testimony of the forensic examiner about the conclusions in another examiner's report, as the statements did not affect Appellant's substantial rights. View "United States v. Soto" on Justia Law

Defendants, Baldwin and Gladys Ihenacho, were the owners and operators of a neighborhood pharmacy. Defendants were convicted of dispensing and shipping drugs to customers pursuant to invalid online prescriptions for Internet pharmacy operations headquartered in the Dominican Republic. Baldwin pled guilty to almost all of the charges. Gladys went to trial, and a jury convicted of her eight counts. The First Circuit Court of Appeals affirmed Baldwin's sentence and Gladys's convictions, holding (1) the district court did not err in applying the fraud sentencing guideline to Baldwin and in calculating the loss caused by Baldwin's offenses for purposes of the fraud guideline; and (2) the evidence was sufficient to support Gladys's convictions for distributing controlled substances, conspiracy, and money laundering. View "United States v. Ihenacho" on Justia Law

After a jury trial, Appellant was convicted of conspiring to commit wire fraud and committing wire fraud for his participation in a wire fraud scheme. Appellant was sentenced to a term of imprisonment followed by supervised release. The First Circuit Court of Appeals affirmed Appellant's convictions and sentences, holding (1) the evidence was sufficient to support the convictions; (2) the district court did not err in admitting files by an attorney involved in the real estate transactions that were the basis of Appellant's indictment; (3) the district court properly admitted evidence related to Appellant's involvement in two real estate transactions that were not the basis of his indictment; and (4) the district court properly sentenced Appellant. View "United States v. Appolon" on Justia Law

Defendant, an engineer for battery producer Electric Vehicles Worldwide (EVW), was convicted of submitting false invoices and conspiring to defraud the Federal Transit Administration (FTA) in connection with federal grants to develop a battery for electric mass transit. The First Circuit Court of Appeals affirmed Defendant's convictions, holding (1) the government's evidence was sufficient to prove beyond a reasonable doubt that Defendant intentionally submitted false or fraudulent claims or conspired to defraud the FTA; and (2) the trial court did not err in refusing to give Defendant's requested theory-of-defense jury instructions on condonation and reasonable interpretation of regulations. View "United States v. Willson" on Justia Law

In 2008, a federal grand jury indicted co-defendants Carolyn Kravetz and Boris Levitin on charges stemming from a scheme to defraud restaurant franchisor Dunkin' Brands Inc. Defendants pled guilty in February 2010. Jim Edwards, a journalist who specialized in coverage of the advertising industry for Bnet.com, began covering the proceedings in 2009. During the proceedings, Edwards noticed that various documents were filed under seal in the criminal case. Edwards subsequently moved to unseal the documents. Kravetz opposed the motion, and the district court denied the motion. The First Circuit Court of Appeals vacated in part and remanded, holding (1) a presumption of public access attached to Defendants' sentencing memoranda and sentencing letters submitted by third parties on Defendants' behalf; and (2) therefore, the district court was required to state with greater specificity its reasons for denying Edwards' motion to unseal these documents. View "United States v. Kravetz" on Justia Law