In United States v. Sutherland, ___ F.4th ___, 2024 U.S. App.LEXIS 13117 (4th Cir. 2024), CA4 here and GS here,the Court rejects the criminal defendant’s collateral attacks on convictionsfor filing false tax returns and obstructing an official proceeding. (Thelatter conviction was for delivering false documents to the government attorneyassisting the grand jury in the tax crimes investigation.) The collateralattacks were mounted by a petition under 28 USC § 2255 and a petition for the writ of coram nobis. The principal claim for both methods of collateral attack was an alleged ineffective assistance ofcounsel (“IAC”) at the criminal trial where the defendant was convicted. Thedefendant appealed the convictions, and the Fourth Circuit affirmed. UnitedStates v. Sutherland, 921 F.3d 421 (4th Cir. 2019), GS here;see also Obstruction Conviction Affirmed for Presentation of False Documentsto AUSA Serving as Attorney for Government for Grand Jury (4/26/19), here.
I post to this blog primarily to refer readers to theexcellent discussion of the collateral attack remedies under § 2255 and coramnobis. Readers wanting the nuance should read the opinion (19 pages, but worththe read). Key summary points are:
1. The principal IAC claim was that defendant’s trial counsel inthe criminal trial gave inadequate representation at trial and at sentencingbecause of failure to present expert tax testimony that would have shown he didnot owe the amount of tax claimed by the Government. The Court of Appealsdescribes this testimony at sentencing as (Slip op. 4-5):
Seeking to mitigate the U.S. Sentencing Guidelines losscalculation in his presentence report, Sutherland presented testimony fromJayne Frazier, a certified public accountant. Frazier reviewed Sutherland’s taxreturns for the years 2007 to 2010 and testified that Sutherland hadunderreported his income by hundreds of thousands of dollars in the relevanttimeframe. Despite that fact, she testified that Sutherland’s total taxliability for that period was less than the Government alleged because Sutherlandfailed to claim various business-expense deductions in 2008, 2009, and 2010,which, if claimed, would have reduced his taxable income for those years.Notably, however, Frazier did not independently audit Sutherland’s tax returns,and her calculations were based largely on information provided by Sutherland,much of which could not be corroborated by itemized receipts or otherdocumentation. See, e.g., J.A. 1230 (Frazier testifying that her calculationsincluded hundreds of thousands of dollars of unclaimed business expenses thatwere “all cash”). She [*5] also stated that her income calculations forSutherland excluded approximately half of the $2 million in transfers from STSto Sutherland’s companies because it was her “understanding” that those fundscame from a line of credit in favor of STS and thus would be “treated as loanadvances” and not “taxable income.” J.A. 1209.
See AlsoHarry Geels: Central bankers, the uncrowned kings of the systemSergey Rakhmanov on LinkedIn: Yesterday, I had the privilege of attending the launch of our new…ESG Decarbonisation in the Shipping IndustryLatest blog articles | Maastricht UniversityThe districtcourt overruled Sutherland’s objection to the presentence report’s losscalculation, finding that Sutherland’s “self-reported information” to Frazier“was not reliable.”
2. In February 2021, after completing theperiod of supervised relief on the tax convictions but before completing theperiod of supervised relief on the obstruction conviction (not sure why theywould be different), the defendant filed (1) the “§ 2255 petition [which] targets theobstruction conviction” and (2) the coram nobis petition which “targets the taxfraud convictions.” (Actually, the convictions were for filing false taxreturns, commonly called tax perjury, rather than “tax fraud” which is commonly called tax evasion.) TheCourt explains why defendant chose the two collateral attack procedures (SlipOp. 6 n. 1):
n1 The reason forthe separate petitions stems from Sutherland’s “custody” status regarding theobstruction conviction, on the one hand, and the tax fraud convictions, on theother. When Sutherland filed both petitions in February 2021, he was stillserving his term of supervised release on his obstruction conviction. Andbecause “[a] prisoner on supervised release is considered to be ‘in custody’for purposes of a § 2255 motion,” United States v. Pregent, 190 F.3d279, 283 (4th Cir. 1999), § 2255 provided Sutherland with the appropriate meansof collaterally attacking his obstruction conviction, see 28 U.S.C. § 2255(a).But since Sutherland had already completed his term of supervised release onthe tax fraud convictions, he was no longer “in custody” with respect to thoseconvictions and thus could no longer collaterally attack them under § 2255,leaving coram nobis as his sole recourse. See Wilson v. Flaherty, 689F.3d 332, 339 (4th Cir. 2012) (stating that the writ of error coram nobis“affords a remedy to attack a conviction when the petitioner has served hissentence and is no longer in custody” (citation omitted)).
3. The Court offers good discussions of the scope of IACreview under Strickland v. Washington, 466 U.S. 668 (1984), which theCourt summarizes (Slip Op. 7 n. 2):
n2 Under Strickland, to succeed on an ineffective assistanceof counsel claim, a petitioner “must show that (1) counsel’s performance fellbelow an objective standard of reasonableness (the performance prong); and (2)the deficient representation prejudiced the defendant (the prejudice prong).” UnitedStates v. Cannady, 63 F.4th 259, 265 (4th Cir. 2023) (citing Strickland,466 U.S. at 687–88).
4 The appeal of a § 2255 petition requires a certificate ofappealability, which the Fourth Circuit granted on the following issues (Slip Op.8):
(1) Whether Sutherland was denied his right to effectiveassistance of counsel; and
(2) Whether the district court erred when it granted theGovernment’s motion to dismiss the § 2255 motion without first conducting anevidentiary hearing.
5. The appeal of the denial of the writ of coram nobis is anappeal of right. (Slip Op. 8 n. 3.)
6. The Court of Appeals held Slip Op. 11-14) that
The problem for Sutherland is that none of this allegedtestimony [about tax liability] bears any relevance to the only conviction atissue in the § 2255 petition—the obstruction conviction. The evidence necessaryto convict Sutherland of that charge depended not on the proper classificationof the STS funds (i.e., nontaxable loans versus taxable income) or the extent[*12] of his tax liability, but on his submitting, through his attorney, fabricatedloan documents to the U.S. Attorney’s Office in response to grand jurysubpoenas.
* * * *
The testimonythat Sutherland claims Phillip and a tax expert would have given at trial in noway bears on Sutherland’s culpability as to the obstruction charge, let alonecalls any of the salient record evidence into question. Indeed, (admissible)testimony from these two witnesses that (1) the STS wire transfers were reallynontaxable loans as opposed to taxable income and (2) Sutherland owed less intotal taxes than the Government alleged for the tax years at issue may havebeen relevant to the tax fraud counts, which were predicated on Sutherland’sunderreporting his income by mischaracterizing the STS wire transfers. But suchtestimony would not have implicated the free-standing obstruction charge,because that charge never hinged on whether Sutherland filed false tax returns.Instead, as we have made clear, it was premised on Sutherland’s providing shamloan documents to the U.S. Attorney’s Office in response to grand jurysubpoenas—entirely separate, and independently unlawful, conduct. And as to thatdistinct conduct, the [*14] testimony Sutherland proffers in his § 2255petition is silent. He makes no claim that either potential witness had anypersonal knowledge regarding the loan documents, their authenticity, or theirprovision to the U.S. Attorney’s Office. Thus, trial counsel’s failure to callthose two witnesses had no prejudicial effect on Sutherland’s defense withrespect to the obstruction conviction.
6, The Court noted (Slip Op. 15) that the writ of coram nobisis an “ancient and rare writ afford[ing] a district court the authority tovacate a criminal conviction after a defendant’s sentence has been completelyserved.” The elements for the writ are (Id.):
(1) a more usual remedy is not available; (2) valid reasonsexist for not attacking the conviction earlier; (3) adverse consequences existfrom the conviction sufficient to satisfy the case or controversy requirementof Article III [of the U.S. Constitution]; and (4) the error is of the mostfundamental character.
7. The Court held that the defendant could have attacked histax fraud convictions earlier via a § 2255 petition. (Slip Op. 15-19).
