United States v. Frazier Williams, Jr. , 705 F. App'x 869 ( 2017 )

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-13627
Non-Argument Calendar
________________________
D.C. Docket No. 8:15-cr-00033-VMC-TBM-1
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
FRAZIER WILLIAMS, JR.,
Defendant-Appellant.
________________________
Appeal from the United States District Court
for the Middle District of Florida
________________________
(August 23, 2017)
Before HULL, WILSON and FAY, Circuit Judges.
PER CURIAM:
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Frazier Williams, Jr. appeals his jury conviction and 36-month sentence for
one count of aiding, assisting, or procuring the preparation of a false tax return
under penalty of perjury. We affirm.
I. BACKGROUND
In 2006, Williams founded Aztech Energy Corporation (“Aztech”), intended
to be a manufacturer and wholesaler of biodiesel. On February 10, 2009, Aztech
filed its 2008 federal income tax return with the Internal Revenue Service (“IRS”)
and claimed a credit in the amount of $2,974,400 for the production, distribution,
or use of biofuels. 1 Six years later, a grand jury returned a one-count indictment
alleging that Williams willfully aided and assisted in, and procured, counseled, and
advised the preparation and presentation to the IRS of a false tax return on behalf
of Aztech for calendar year 2008, in violation of 26 U.S.C. § 7206(2).
Prior to trial, Williams filed a motion in limine to exclude evidence relating
to purchases that were made after the tax refund allegedly was received by
Williams, his company, and/or his counsel. Williams stated that the refund money
had been deposited into a bank account; however, the government believed that
Williams and Sean Donnelly, the manager of Aztech and an attorney, had spent it.
Williams argued that any transactions relating to the tax refund were not relevant
1
The IRS’s biofuel program was an incentive program, which gave companies tax credits for
developing alternative fuels. The rate varied depending on the amount of ethanol in the fuel, and
the credit took effect upon the sale of the fuel.
2
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to the charged crime; alternatively, he argued that if the evidence was relevant, its
probative value was substantially outweighed by the danger of unfair prejudice,
confusing the issues, or misleading the jury. The district court denied the motion
because it found that the evidence of spending was relevant and not unduly
prejudicial. The court indicated that it might reconsider the issue depending on the
evidence presented at trial.2
At trial, Shirley Ball, an IRS court-witness coordinator, testified that she had
gathered and provided to the government certified copies of Aztech’s 2006, 2007,
and 2008 tax returns. The government admitted into evidence IRS documents
from 2006 to 2008. On one of the 2007 tax-return forms, Williams was listed as
Aztech’s shareholder. According to the 2008 paperwork, Williams was the contact
person for Aztech and he owned 100% of the stock. There was a credit for fuel tax
in the amount of $2,974,400; Aztech’s tax return requested a refund in that
amount. The 2008 tax return was filed electronically. While Form 8453-S
originally was not signed, there was a signed copy of the form that the IRS had
sent to Aztech once it realized that the first form was not signed. Ball testified that
the tax return was signed by Williams but the address was for Donnelly’s law firm.
Donnelly had written a letter stating that his firm, which represented Aztech, had
2
Prior to impaneling the jury, Williams renewed his motion to exclude the evidence of his
purchases using the tax-return money. The district court denied the motion without prejudice
and offered to reconsider the evidence as it was admitted at trial.
3
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provided the IRS with forms and requested a tax refund. Ball testified that,
including interest, the IRS had paid Aztech $2,990,217.80.
Three IRS agents—Cindy Ferwerda, Thara Maynor, and Robert Crockett—
testified that Williams admitted to preparing and filing Aztech’s 2007 and 2008 tax
returns. In early 2010, Agents Ferwerda and Maynor audited Aztech based on its
2008 tax return. Agent Ferwerda testified that Williams told her that Aztech had
not sold any alcohol/fuel mixture in 2008 because it was still in the research and
development stage. After reviewing Aztech’s records, Agent Ferwerda only found
sales invoices to support 18,033.35 gallons of biodiesel sold; Aztech had claimed
for a sale of 92,950 gallons. Additionally, Williams purchased 14,312 gallons of
methanol, which could have been used to produce 2,800,000 gallons, not the
claimed 4,647,500 gallons.
Agent Maynor testified, for calendar year 2007, a refund for $809,595 had
been issued to Aztech and had been distributed to individuals in the company,
including to Williams and to Donnelly’s trust account. The 2008 refund was $2.9
million and about $1 million of that was controlled by Williams. He used
$185,000 to purchase an Aston Martin car and spent $78,038.60 at a jewelry store.3
Frank Gnisci, an accountant, testified that Aztech hired him in 2009 to
prepare unaudited financial statements for a transaction they were planning. He
3
When the government offered into evidence charts showing how Williams spent the tax-return
money, Williams did not object.
4
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spoke with Williams and Donnelly about preparing the 2008 tax return but he did
not deal with the tax credits. The taxes were done using a software program;
Gnisci believed that only Williams had the password.
After the government rested,4 Williams moved for a judgment of acquittal
pursuant to Federal Rule of Criminal Procedure 29 and argued that the government
had not met its burden on every element of the crime. The district court denied his
motion, stating that the evidence was sufficient.
Williams testified that he did not intentionally provide false information to
prepare Aztech’s 2008 tax return. While Williams had prepared Aztech’s 2006 tax
return, Donnelly became involved with Aztech near the end of 2007 and prepared
the 2007 tax return. In 2008, Williams began to make bio-gasoline and he turned
over the company finances to Donnelly. Donnelly was responsible for purchasing
ingredients and supplies and was aware of how much was being billed. Williams
testified that he had no role in preparing the 2008 tax return, he did not have the
password to the software, and he did not tell IRS agents that he had prepared the
2007 and 2008 tax returns. He did, however, sign the 2007 and 2008 tax returns
under penalty of perjury. In early 2008, Aztech stopped operations for about nine
months. Williams signed and certified, under penalty of perjury, that Aztech had
produced 4,832,500 gallons of biofuel in 2008 and requested a tax credit of
4
The government also presented the testimony of several other witnesses regarding Aztech’s
inability to pay debts and its inability to have produced the claimed biodiesel.
5
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$2,974,400. He stated he had not seen that tax return until the audit several years
later but he had signed it because Donnelly told him it was true. When asked how
he believed Aztech could have received such a large tax refund after being shut
down for nine months, Williams said that Donnelly had found an investor and he
thought the $940,000 deposit into his account was from the investor.
At the conclusion of the trial, Williams renewed his motion for judgment of
acquittal; the court denied it for the same reason as before. The jury found
Williams guilty. Williams filed a motion for new trial based on newly discovered
evidence. Williams argued that (1) a deposition of Gnisci in a state civil suit
revealed that he refused to answer a question about his involvement with the 2008
tax return and asserted his Fifth Amendment right; (2) for the civil case, Gnisci
submitted “billing statements” for work done on the 2008 tax return, despite
claiming at trial that he did not work on the return; and (3) Donnelly “most
probably” used a software scrubbing program to delete over 11,000 relevant files
from a computer server immediately before the state civil court’s appointed
computer forensic examiner performed a forensic examination ordered by the state
judge. R. at 563. The district court denied the motion because there was other
“substantial evidence” of Williams’ guilt and the newly discovered evidence was
impeachment evidence only. R. at 1656. The court stated the most important
evidence had been the documents and Williams’ own words, not other testimony.
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The district court adopted the presentence investigation report that had
determined the total offense level was 28; the criminal history category was I; the
statutory maximum term was 3 years of imprisonment; and the guideline
imprisonment range was originally 78 to 97 months, but it was reduced to 36
months because of the statutory maximum term. In mitigation, Williams argued
that he had the support of his family, his family needed him, he had little criminal
history, and he had been abused as a child. The court stated, “I agree with you, he
had just a real rough childhood,” but noted that millions of dollars had been lost in
the crime. R. at 1682. The court sentenced him to 36 months of imprisonment, 1
year of supervised release, and $2,974,400 in restitution to the United States.
On appeal, Williams argues the district court committed plain error in
admitting evidence of purchases made after issuance of the tax return, erred in
denying his motion for judgement of acquittal, abused its discretion in denying his
motion for a new trial, and abused its discretion in sentencing him to 36 months of
imprisonment.
II. DISCUSSION
A. Admissibility of Williams’ Purchases
The district court has broad discretion to determine the admissibility of
evidence; we will not disturb the district court’s judgment absent a clear abuse of
discretion. United States v. McLean, 138 F.3d 1398, 1403 (11th Cir. 1998).
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However, when a defendant fails to preserve or renew during trial his objection to
the denial of a motion in limine, we review for plain error. United States v. Brown,
665 F.3d 1239, 1247 (11th Cir. 2011). To establish plain error, the defendant must
show (1) there was an error; (2) that was plain or obvious; and (3) affected his
substantial rights in that it was prejudicial and not harmless. Id. at 1247 n.3.
Evidence is relevant if it has any tendency to make the existence of any fact
that is of consequence to the determination of the action more probable or less
probable than it would be without the evidence. Fed. R. Evid. 401. The district
court may exclude evidence if its probative value is substantially outweighed by
the danger of unfair prejudice. Fed. R. Evid. 403. “Use of a defendant’s wealth to
appeal to class bias can be highly improper and can deprive that defendant of a fair
trial. But evidence of wealth or extravagant spending may be admissible when
relevant to issues in the case and where other evidence supports a finding of guilt.”
United States v. Bradley, 644 F.3d 1213, 1271 (11th Cir. 2011) (internal quotation
marks and citation omitted). “Motive is always relevant in a criminal case, even if
it is not an element of the crime.” United States v. Hill, 643 F.3d 807, 843 (11th
Cir. 2011) (alteration omitted) (quoting United States v. Sriyuth, 98 F.3d 739, 747
n.12 (3d Cir. 1996)).
Here, we review for plain error because Williams failed to renew his
objection during trial. See Brown, 665 F.3d at 1247. Because the evidence at trial
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showed that Aztech had shut down for a large portion of 2008, Williams’ use of
the tax-return money to make purchases was relevant to show his motive in filing
the false return. See Hill, 643 F.3d at 843. Furthermore, the probative effect, in
showing either motive or intent, was not outweighed by the prejudicial effect of
letting the jury know about his spending. See Fed. R. Evid. 403; Bradley, 644 F.3d
at 1271. The court therefore did not commit error, under plain error review, in
admitting evidence of Williams’ purchases. See Brown, 665 F.3d at 1247.
Viewing the evidence in the light most favorable to admission,5 it was relevant to
prove Williams’ knowledge and motive. See Fed. R. Evid. 401.
B. Sufficiency of the Evidence
We review de novo whether the evidence was sufficient to sustain a criminal
conviction, viewing the evidence in the light most favorable to the government,
and drawing all reasonable factual inferences in favor of the jury’s verdict. United
States v. Jiminez, 564 F.3d 1280, 1284 (11th Cir. 2009). The evidence will be
sufficient if a reasonable trier of fact could determine that it established the
defendant’s guilt beyond a reasonable doubt. Id. at 1284-85. Accordingly, it is not
enough for a defendant to put forth a reasonable hypothesis of innocence, as the
issue is not whether a jury reasonably could have acquitted but whether it
5
See United States v. Bradberry, 466 F.3d 1249, 1253 (11th Cir. 2006) (“In evaluating the
district court’s ruling under Rule 403, we view the evidence in the light most favorable to
admission, maximizing its probative value and minimizing its undue prejudicial impact.”).
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reasonably could have found the defendant guilty. Id. at 1285. In conducting
sufficiency review, we will not revisit the question of witness credibility unless the
testimony is “incredible as a matter of law.” United States v. Chastain, 198 F.3d
1338, 1351 (11th Cir. 1999). When a defendant chooses to testify, he runs the risk
that, if disbelieved, the jury might conclude the opposite of his testimony is true,
and his false testimony may be considered as substantive evidence of his guilt.
United States v. Vazquez, 53 F.3d 1216, 1225-26 (11th Cir. 1995).
To prove a violation of 26 U.S.C. § 7206, the government had to prove that
Williams (1) willfully and knowingly aided or assisted (2) in the preparation or
filing of a federal income tax return (3) that contained material statements that the
defendant knew to be false. 26 U.S.C. § 7206(2). The government’s evidence at
trial, in the form of testimony and IRS documents, was sufficient for a reasonable
jury to determine beyond a reasonable doubt that Williams willfully and knowingly
aided or assisted in the preparation or filing of Aztech’s 2008 federal income tax
return that contained material statements about biofuel credits that he knew to be
false. See 26 U.S.C. § 7206(2); Jiminez, 564 F.3d at 1284-85. It was not enough
for Williams to present his hypothesis of innocence—that his coworkers used him
to file the tax return themselves and lied to him about it—as the issue is not
whether the jury reasonably could have acquitted but whether it reasonably could
have found Williams guilty. See Jiminez, 564 F.3d at 1285.
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Williams’ testimony itself is also substantive evidence of his guilt, as the
jury was entitled to conclude that the opposite of his testimony was true. See
Vazquez, 53 F.3d at 1226. Additionally, as the trial testimony did not appear to be
“incredible as a matter of law,” we will not evaluate the jury’s credibility
determinations about the IRS agents, Williams, and other witnesses. See Chastain,
198 F.3d at 1351. Accordingly, the district court did not err in denying the motion
for judgment of acquittal. See Jiminez, 564 F.3d at 1284.
C. Motion for New Trial
We review for an abuse of discretion the district court’s denial of a motion
for new trial. United States v. Garcia, 13 F.3d 1464, 1472 (11th Cir. 1994). The
defendant bears the burden of justifying a new trial. United States v. Campa, 459
F.3d 1121, 1151 (11th Cir. 2006) (en banc).
To succeed on a motion for new trial based on newly discovered
evidence, the movant must establish that (1) the evidence was
discovered after trial, (2) the failure of the defendant to discover the
evidence was not due to a lack of due diligence, (3) the evidence is
not merely cumulative or impeaching, (4) the evidence is material to
issues before the court, and (5) the evidence is such that a new trial
would probably produce a different result.
United States v. Jernigan, 341 F.3d 1273, 1287 (11th Cir. 2003) (quoting United
States v. Ramos, 179 F.3d 1333, 1336 n.1 (11th Cir. 1999)).
Even assuming all of the evidence was discovered after trial, the district
court did not abuse its discretion in denying the motion because the evidence was
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impeachment evidence and it was unlikely to produce a different result in a new
trial. See Garcia, 13 F.3d at 1472. As to the deleted files, even if a witness did
delete them, there is no indication that they would have been exculpatory and
produce a different result at trial because there is nothing showing what was in
those files. See Jernigan, 341 F.3d at 1287. Another witness’s refusal to answer
questions at the civil deposition and billing statements that contradicted Williams’
criminal trial testimony are impeachment evidence because they go to credibility
and are not direct evidence of guilt. See id. Furthermore, none of the evidence
necessarily would produce a new result at trial, in light of the testimony of the IRS
agents and the documentary evidence showing that Williams signed the tax return
knowing it to be false. See id. Accordingly, Williams did not meet his burden to
justify a new trial. See Campa, 459 F.3d at 1151.
D. Williams’ Sentence
We review the reasonableness of a sentence under a deferential
abuse-of-discretion standard. Gall v. United States, 552 U.S. 38, 51, 128 S. Ct.
586, 597 (2007). The party who challenges the sentence bears the burden to show
that the sentence is unreasonable given the seven 18 U.S.C. § 3553(a) factors and
the record. United States v. Tome, 611 F.3d 1371, 1378 (11th Cir. 2010). On
substantive-reasonableness review, we may vacate the sentence only if we are left
with the definite and firm conviction that the district court committed a clear error
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of judgment in weighing the § 3553(a) factors to arrive at an unreasonable sentence
based on the facts of the case. United States v. Irey, 612 F.3d 1160, 1190 (11th
Cir. 2010) (en banc). The district court must issue a sentence sufficient, but not
greater than necessary to comply with the purposes of § 3553(a)(2), which include
the need for a sentence to reflect the seriousness of the offense, promote respect for
the law, provide just punishment, deter criminal conduct, and protect the public
from future criminal conduct. 18 U.S.C. § 3553(a). The weight given to any
§ 3553(a) factor is a matter committed to the discretion of the district court.
United States v. Williams, 526 F.3d 1312, 1322 (11th Cir. 2008).
Here, the district court did not abuse its discretion in imposing the 36-month
sentence in light of the § 3553(a) factors, namely, the need for the sentence to
reflect the seriousness of the offense, provide just punishment, deter criminal
conduct, and protect the public from future criminal conduct. See 18 U.S.C.
§ 3553(a); Gall, 552 U.S. at 51, 128 S. Ct. at 597. The court stated at the
sentencing hearing that it considered the mitigating evidence, but gave more
weight to the seriousness of the offense, namely, the high amount of loss. See
Williams, 526 F.3d at 1322. Accordingly, the district court did not commit a clear
error of judgment in weighing the § 3553(a) factors to arrive at the sentence based
on the facts of the case. See Irey, 612 F.3d at 1190.
AFFIRMED.
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