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

Heckman did not report, as income, a distribution from his employee stock ownership plan into his individual retirement account of investments worth $137,726 on his 2003 tax return. The IRS issued a notice of deficiency in 2010. The plan was not eligible for favorable tax treatment under 26 U.S.C. 401(a), so the distribution constituted taxable income. Heckman petitioned the tax court, arguing that the deficiency notice was untimely, because the statute of limitations expired three years after the filing of his return. The tax court determined that a six-year statute of limitations applied and held Heckman liable for a deficiency of $38,623. The Eighth Circuit affirmed. Under 26 U.S.C. 6501(a), the IRS must assess a deficiency within three years. Section 6501(e)(1)(A) extends that period to six years if the taxpayer “omits from gross income” an amount in excess of 25 percent of the gross income stated on the return. The distribution exceeded 25 percent of Heckman’s gross income for 2003. An amount is not considered “omitted” from gross income if it is “disclosed in the return, or in a statement attached to the return,” in an adequate manner. Heckman did not disclose the distribution. View "Heckman v. Comm'r of Internal Revenue" on Justia Law

In 2012 the Golans received two unsolicited, prerecorded messages on their home phone line. Each message, recorded by Mike Huckabee, stated: "Liberty. This is a public survey call. We may call back later." The Golans had not answered the phone; more than one million people did and received a much longer message. The Golans filed a putative class action, alleging that the phone calls were part of a telemarketing campaign to promote the film, Last Ounce of Courage, in violation of the Telephone Consumer Protection Act, 47 U.S.C. 227, and the Missouri Do Not Call Law. The district court dismissed with prejudice, concluding that the Golans did not have standing and were inadequate class representatives, being subject to a "unique defense" because they had heard only the brief message recording on their answering machine. The Eighth Circuit reversed and remanded. The calls were initiated and transmitted in order to promote Last Ounce of Courage and qualified as "telemarketing" even though the messages never referenced the film. Because the purpose of the calls was the critical issue, the Golans were not subject to a unique defense. Nor did they suffer a different injury than class members who heard the entire message. View "Golan v. Veritas Entm't, LLC" on Justia Law

While in prison, Brown incorporated “Softwear Group.” After his release, Brown obtained an investment from Armstrong, a prison friend, who was in the residential mortgage business. Brown earned $5,000 per month. When the company floundered, Brown purchased five homes in 2006. Brown inflated the purchase price on his loan applications, prepared by Armstrong. He represented that he would occupy each house and that he earned $15,000 per month. Brown received kickbacks totaling $224,500. Brown was charged with wire fraud and conspiracy, 18 U.S.C. 1343, 1349. The prosecution presented testimony from Parton, the loan closer. On cross examination, defense counsel questioned Parton about statements she allegedly made to a private investigator, Reeder, by telephone. Brown called Reeder to testify about that interview. The court ruled that Parton’s testimony that she could not recall making certain statements was not inconsistent with her alleged statements as recounted by Reeder, so that Reeder’s testimony could not be used to impeach Parton, and instructed the jury to disregard Reeder’s testimony. Armstrong took a plea agreement and testified. Defense counsel asked Armstrong about his possible sentence, eliciting testimony that his “criminal history” was going to be “quite high.” The court sustained the government’s objection. The court sentenced Brown to 87 months’ imprisonment. The Eighth Circuit affirmed, rejecting his argument that the court violated his right of confrontation by limiting cross-examination of Armstrong and by excluding Reeder’s testimony regarding Parton’s interview. View "United States v. Brown" on Justia Law

In 2005 Ellis formed CST, to engage in the business of used automobile sales in Harrisonville, Missouri. CST's members were Ellis's self-directed IRA and Brown, an unrelated full-time CST employe. Ellis’s IRA was to provide an initial capital contribution of $319,500 in exchange for a 98 percent ownership and Brown would purchase the remaining interest for $20. Ellis was the general manager, with “full authority to act on behalf of” the company. Ellis subsequently established the IRA with First Trust, received money from a 401(k) established with his previous employer, and deposited that amount in his IRA. He directed First Trust to acquire shares of CST. Ellis reported the transfers from his 401(k) to the IRA as non-taxable rollover contributions. CST paid Ellis a salary of $9,754 in 2005 and $29,263 in 2006, which was reported as income on the Ellises’ joint tax returns. The IRS sent the Ellises a notice of deficiency, identifying a $135,936 income-tax deficiency for 2005 or, alternatively, a $133,067 deficiency for 2006; it imposed a $27,187 accuracy penalty for 2005 or, alternatively, a $26,613 accuracy penalty and $19,731 late-filing penalty for 2006. The Commissioner determined that Ellis engaged in prohibited transactions under 26 U.S.C. 4975(c) by directing his IRA to acquire an interest in CST with the expectation that CST would employ him, and receiving wages from CST, so that the account lost its IRA status and its entire fair market value was treated as taxable income. The tax court and Eighth Circuit agreed. View "Ellis v. Comm'r of Internal Revenue" on Justia Law

In an ATF sting, undercover agents would describe a fictitious location where drugs were supposedly stored, and support plans for robbing it. St. Louis confidential informants purchased cocaine from Warren's cousin, Washington, then introduced Washington to undercover agent Zayas, who purchased more cocaine. Zayas claimed that he was a disgruntled drug courier looking for help in robbing a Mexican drug cartel of large amounts of cocaine. Washington introduced Zayas to Warren and Twitty. Everyone agreed to commit the robbery. Zayas showed the others how to operate the hidden compartment of the "trap car." As he did so, ATF officers emerged and arrested them. Searching Warren's car, they found loaded guns. Warren was charged with conspiring to possess with intent to distribute cocaine; possessing a firearm in furtherance of a drug trafficking conspiracy; and being a felon in possession of a firearm. Washington and Twitty pled guilty. The court allowed introduction of Rule 404(b) evidence pertaining to Warren's prior convictions involving controlled substances and firearms, as "other act" evidence of guilt. The court upheld the government’s striking of two black potential jurors: both had failed to respond to voir dire questions. The jury convicted Warren. Rejecting Warren’s argument that "no drugs were ever involved," the court sentence him to 211 months. The Eighth Circuit affirmed, rejecting claims of entrapment and sentencing entrapment and challenges to evidentiary rulings and jury selection. View "United States v. Warren" on Justia Law

Barillas, a citizen of Guatemala, entered the U.S. in 2006 without inspection and sought asylum and withholding of removal (8 U.S.C. 1101(a)(42)(A); 8 U.S.C. 1158(b)), arguing that in Guatemala, he suffered economic and physical abuse by an aunt, with whom he lived while his parents were in the U.S., and a beating by a cousin, that amounted to persecution. He said that police never learned of the abuse, as neighbors never knew about it, and that his mother arranged for him to travel to the U.S. after she visited and observed his living conditions. The IJ denied the application and ordered removal, finding that the allegations did not establish persecution or a well-founded fear of future persecution, that actions by private individuals would not amount to persecution, that Barillas failed to show that the government was unwilling or unable to control them, and, alternatively that Barillas failed to show that the alleged persecution was on account of the protected grounds alleged, political opinion or membership in a particular social group. The Board affirmed. The Eighth Circuit denied a petition for relief, finding that the Board considered the relevant factors, including the age at which Barillas suffered abuse and the cumulative impact of the physical and economic abuse. View "Barillas-Mendez v. Lynch" on Justia Law

Before 2010, no disciplinary issues were recorded in the employment history of former BNSF Railway claims representative Ludlow. In 2009, Ludlow discovered his forged signature on documents submitted to the Department of Veterans Affairs certifying that coworker Fernandes was eligible to receive VA training benefits. Ludlow reported the forgery to his supervisor, Wunker, opining that Fernandes may have been responsible. Wunker did not investigate or report to his superiors, contrary to what Ludlow believed BNSF protocol required. In 2010, Ludlow reported the forgery to the BNSF police, notifying Wunker the following day. Wunker expressed concern that the disclosure could cost him his job and began sending complaints regarding Ludlow’s workplace behavior to Human Resources. After his termination, Ludlow sued for wrongful termination in violation of Nebraska public policy and whistleblower retaliation under the Nebraska Fair Employment Practices Act (NFEPA), Neb. Rev. Stat. 48-1114(3). A jury found BNSF liable on the NFEPA claim and awarded damages. The court awarded $206,514.13 in attorney’s fees and $22,202.16 in nontaxable costs. The Eighth Circuit affirmed, rejecting challenges to jury instructions that Ludlow need only prove that his protected activity was a “motivating factor” in the termination and to the amount of attorney’s fees and costs. View "Ludlow v. BNSF Ry. Co." on Justia Law

A masked man fired shots into a car, striking occupants. Witnesses saw a black Chrysler leave the area. Moments later, an officer saw a black Chrysler blocks from the crime scene, asked the driver, Phillip Roberts, to identify himself, took pictures of him, and allowed Roberts to leave. A week later, police received an anonymous tip concerning “Phillip,” called “Philco,” with a photograph of Phillip that matched a booking picture of Roberts. The gang unit indicated that Roberts was called Philco. A witness identified Roberts from a photo lineup. A notice to arrest Roberts issued. Officers recognized Roberts while driving and arrested him. Roberts was the sole occupant of the car, which was registered to Roberts. An inventory search uncovered marijuana and a handgun in the center console. Roberts, recorded by the police car’s system during the search, said, “[b]ack to the joint,” The gun had no fingerprints, but DNA from the gun was consistent with Roberts’s DNA. Roberts was charged as a felon in possession of a firearm. He unsuccessfully moved to suppress the handgun and marijuana and a statement he made after his arrest. Roberts was convicted and sentenced to 180 months’ imprisonment, 18 U.S.C. 924(e)(1). The Eighth Circuit affirmed, rejecting challenges to the two vehicle stops. View "United States v. Roberts" on Justia Law

Keatings pled guilty as a felon in possession of a firearm, 18 U.S.C. 922(g)(1). He faced up to 10 years in prison, 18 U.S.C. 924(a)(2). Although Keatings’s criminal history was a Category 3, his last felony was more than 18 years old. Keatings was cooperative with the investigation that led to his conviction, had no pretrial release violations except one positive test for marijuana, early in his release, and had maintained a full-time job. His employer reported that he was an outstanding employee. Keatings sought probation, promising the court, “if you give me a chance, I’ll show you I’ll be a better man and you’ll never see me again.” Although Keatings’s history included several probation and parole violations that resulted in additional prison time, the judge stated: I’ll send you to prison today for a year and a day, or I’ll put you on probation for five years … I’m reserving the right to send you to prison for ten years if you break this probation. Keatings agreed to take probation and the judge laid out strict conditions. About four months later Keatings was accused of probation violations, using alcohol and cocaine. The Eighth Circuit affirmed imposition of a 10-year sentence. View "United States v. Keatings" on Justia Law

Hardy filed for Chapter 13 bankruptcy relief. On her Schedule B, Hardy stated that she would be receiving a 2012 tax refund. On her Schedule C, Hardy claimed the majority of the refund as exempt. She noted that $2,000 of the refund was attributable to federal Child Tax Credit (CTC), 26 U.S.C. 24(d). She claimed that the CTC was a "public assistance benefit" that would be exempt from the bankruptcy estate under Missouri law. The bankruptcy court sustained the trustee’s objection, finding that the CTC was not a public assistance benefit because the purpose of the credit was to "reduce the tax burden on working parents and to promote family values" and because the full credit was available to head-of-household filers with Modified Adjusted Gross Incomes (MAGI) of up to $75,000 and joint-married filers with MAGIs of up to $110,000. The Bankruptcy Appellate Panel affirmed, stating Hardy did not present evidence that only lower income families were eligible for the refundable portion of the credit. The Eighth Circuit reversed, reasoning that Congress demonstrated intent to help low-income families through amendments to the Additional Child Tax Credit statute, sp the credit at issue qualifies as a public assistance benefit. View "Hardy v. Fink" on Justia Law