Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

Defendant was convicted of failing to account for and pay employment taxes under 26 U.S.C. 7202, sentenced to 48 months imprisonment and fined $75,000. Defendant appealed his conviction, the calculation of loss to the government, and his fine. The court held that the district court did not err under Federal Rule of Evidence 404(b) in admitting evidence relating to defendant's compliance with Minnesota tax law. The court held however, that the district court made insufficient findings to conclude that defendant had violated section 7206(2). Accordingly, the court vacated the calculation of loss and remanded for resentencing on the existing record. Because the court remanded for resentencing, it did not reach defendant's remaining arguments.

Defendant was convicted of one count of conspiracy to defraud the United States and two counts of aiding and assisting in the preparation of a false tax return. At trial, the government offered, without objection, evidence that defendant had failed to file personal income tax returns from 2002 to 2007. Defendant argued that his personal filing history was impermissible specific-act character evidence. The court held that defendant's failure to file tax returns from 2002 through 2007, when compared with the similar failures of his co-conspirators, were probative of the existence of a conspiracy. Although the court was skeptical of the government's argument that the jury did not view those failures in a negative light, the court could not conclude that any unfair prejudice derived from their admission substantially outweighed their probative value. Moreover, given the overwhelming evidence of guilt presented at trial, the court could not conclude that the admission of the testimony affected defendant's substantial rights. Accordingly, the conviction was affirmed.

Defendant pleaded guilty to four counts of aiding and abetting the preparation of false federal income tax returns and was sentenced to 72 months imprisonment. Defendant argued that his experiences in Somalia during the violent Somali civil war entitled him to a sentence well below the advisory Guidelines range. At issue was whether the district court's sentence was substantively unreasonable. The court held that the district court not only considered defendant's personal history and circumstances in fashioning a sentence, but reduced the sentence it would have otherwised assessed defendant in light thereof. Therefore, the district court did not abuse its discretion in sentencing defendant to 72 months imprisonment.

T-Mobile Central LLC ("T-Mobile") sued Missouri municipalities for refund of certain tax payments that it had paid under protest and filed ten separate lawsuits seeking to recoup tax payments made within ten specific time periods. Appellees brought ten separate class action suits against T-Mobile in state court for passing the contested tax onto customers and sought to recover any money that the Missouri municipalities refunded to T-Mobile. At issue was whether the district court had jurisdiction under the Class Action Fairness Act ("CAFA"), 28 U.S.C. 1332(d)(6), to remand the ten class actions to the state court from which they were removed. The court affirmed the judgment of the district court and held that there was no indication that appellees artificially divided the lawsuit to avoid the CAFA where the structure of appellees' class actions exactly mirrored the underlying ten lawsuits brought by T-Mobile and were driven by T-Mobile's own litigation decisions.