USA v. James Faller, II

Filing

OPINION filed : AFFIRMED, decision not for publication. Richard F. Suhrheinrich, Circuit Judge; Jeffrey S. Sutton, Circuit Judge and David W. McKeague, Authoring Circuit Judge. [16-5168, 16-5391]

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NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 17a0021n.06
Case Nos. 16-5168/5391
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

FILED
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
JAMES FALLER II,
Defendant-Appellant.

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Jan 10, 2017
DEBORAH S. HUNT, Clerk

ON APPEAL FROM THE
UNITED STATES DISTRICT
COURT FOR THE WESTERN
DISTRICT OF KENTUCKY

OPINION

BEFORE: SUHRHEINRICH, SUTTON, and McKEAGUE, Circuit Judges.
McKEAGUE, Circuit Judge. Taxpayers are obligated to pay their taxes. James S.
Faller II was convicted by a jury of his peers for not paying his, attempting to evade the
obligation, and committing related offenses. He was sentenced to 36 months’ imprisonment. He
now appeals his conviction and asks for a new trial, raising a litany of challenges to the
proceedings in district court. Because his arguments have no merit, we affirm the district court
and deny his motions.
Faller was indicted on eleven counts for violations of the Internal Revenue Code. He
represented himself during the subsequent two-week trial and raised a defense largely based on
what he believes is a wide-ranging government conspiracy against him. Twelve jurors found his
defense unpersuasive and convicted him on ten of the eleven counts. Following his conviction,

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Faller filed several motions asking the district court for a new trial. The district court denied
these motions. Faller now brings this timely, consolidated appeal.1
I.
Faller, through his court-appointed attorney and supplemental pro se briefing, raises
seven arguments that he asserts require this court to dismiss his conviction.
First, he argues that the police failed to preserve a Dell laptop computer which he claims
contained exculpatory evidence. Because Faller preserved this argument by raising it in his postconviction motions filed in the district court, we review de novo.2 See United States v. Wright,
260 F.3d 568, 570 (6th Cir. 2001). Following Brady v. Maryland, 373 U.S. 83 (1963), the
government must “disclose all exculpatory and impeachment evidence that is in the
government’s possession in time for use at trial.” United States v, Smith, 749 F.3d 465, 492 (6th
Cir. 2014) (internal quotation marks removed). But the government says it never possessed the
laptop—it went missing when one of Faller’s associates sent it off for repairs—and therefore had
no duty to discover its whereabouts or somehow disclose its contents. See United States v.
Graham, 484 F.3d 413, 417 (6th Cir. 2007). The record supports this position. And Faller
makes no showing that the government possessed the laptop, he merely asserts—without any
support—that the associate who supposedly sent the computer off for repairs was part of the
government’s conspiracy to get him. Absent more, Faller has failed to show the government
owed any duty with regard to the laptop. Thus, the missing computer (and exculpatory evidence
it supposedly contained) provide no grounds for dismissing his conviction on this appeal.

1

This court previously affirmed the district court’s order denying Faller’s two pro se
motions for release on bail pending appeal.
2

We construe Faller’s pro se pleadings liberally. See Erickson v. Pardus, 551 U.S. 89,
94 (2007) (per curiam). Doing so, we find Faller raised the failure-to-preserve argument, though
less than clearly, in his second motion for a new trial. (R. 356, PID 8043–44.)
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Next, Faller argues that the district court’s refusal to order the government to disclose
grand jury testimony of a witness he called at trial—Special Agent Matthew Sauber—constituted
reversible error pursuant to the Jencks Act, 18 U.S.C. § 3500. We review a district court's ruling
on the production of Jencks Act material for clear error. United States v. Baker, 562 F. App'x
447, 454 (6th Cir. 2014) (citing United States v. Nathan, 816 F.2d 230, 237 (6th Cir. 1987)). The
Jencks Act “directs the government to produce statements or reports made or used by
government witnesses at trial.” United States v. Macias-Faria, 706 F.3d 775, 779 n.1 (6th Cir.
2013). However, Faller requested the government to produce statements made by a witness he
called at trial—not a witness “called by the United States on direct examination.” 18 U.S.C. §
3500(b). Thus, the district court did not err; the Jencks Act is inapplicable.
Third, Faller asserts that the district court’s conduct showed improper bias, denying him a
fair trial. Because Faller never sought recusal of the presiding judge and did not object during
trial to the relevant statements made by the court, we review the court’s conduct for plain error.
United States v. McAllister, 693 F.3d 572, 584 (6th Cir. 2012). Plain error requires Faller to
“show (1) error (2) that was obvious or clear, (3) that affected defendant’s substantial rights and
(4) that affected the fairness, integrity, or public reputation of the judicial proceedings.” Id.
Faller points to five isolated comments and questions made by the district court as evidence of
bias. But none of the statements—especially when read in the context of the two-week trial—
show bias. Instead, the court’s comments and questions, only three of which were heard by the
jury, are best understood as attempts by the court to clarify and avoid redundancies. At worst, an
isolated statement by the court may have expressed some modicum of frustration at Faller’s often
convoluted pro se defense. But the court’s conduct does not indicate bias such that Faller was
denied a fair trial; he has failed to show plain error.

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Faller’s next set of arguments is that there was insufficient evidence to sustain his
conviction. We review de novo. United States v. Fisher, 648 F.3d 442, 450 (6th Cir. 2011). In
determining whether there is sufficient evidence to preserve a conviction, we read the evidence
in the light most favorable to the prosecution and ask whether any rational juror could have
found the essential elements of the crime beyond a reasonable doubt. See United States v.
Martinez, 588 F.3d 301, 314 (6th Cir. 2009). This court must defer to the jury’s credibility
determinations and may not “reweigh the evidence” or “re-evaluate the credibility of witnesses.”
Fisher, 648 F.3d at 450.
To begin with, Faller challenges his conviction under 26 U.S.C. § 7201 for sufficiency of
the evidence. In order to prove a violation of § 7201, the government must prove willfulness,
existence of a tax deficiency, and an affirmative act constituting evasion of the tax. United
States v. Heath, 525 F.3d 451, 456 (6th Cir. 2008). Faller asserts there was insufficient evidence
that he willfully or affirmatively evaded his tax obligations. We disagree. The government
presented evidence that Faller made false statements to an IRS official, provided false
information to his accountant, titled his home and opened a bank account in the name of a trust
in which he deposited checks, and withdrew large sums of cash from the accounts he controlled.
These efforts to conceal his assets permit a rational juror to find Faller knew he owed taxes but
intentionally set out to avoid paying them. This is sufficient evidence to sustain the conviction.
See United States v. Daniel, 956 F.2d 540, 542–43 (6th Cir. 1992).
Faller also challenges his conviction for attempting to obstruct the IRS in the collection
of taxes due from 2006 through 2011 in violation of 26 U.S.C. § 7212. This court has held that,
in part, this provision requires the government to show the defendant “knew of a pending IRS
proceeding when he engaged in the conduct that impeded the IRS’s ability to administer the

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revenue code.” United States v. Miner, 774 F.3d 336, 342 (6th Cir. 2014). Faller argues, for the
first time on appeal, that there was no pending IRS proceeding during the relevant time period,
and so his conviction was not supported by sufficient evidence. However, a review of the record
reveals that the government presented to the jury sufficient evidence to show that there were IRS
proceedings of which Faller was aware from 2006 through 2011, including steps taken by the
IRS to collect Faller’s unpaid income taxes and an outstanding trust fund penalty. This evidence
is sufficient to sustain the conviction.
Faller also asserts that his 26 U.S.C. § 7206(1) conviction, for knowingly giving false
information to the IRS, cannot be sustained on the evidence presented. This argument hinges on
testimony at trial that the relevant form, submitted to the IRS with false information, was blank
when Faller signed it. But the government presented opposing witness testimony that Faller
provided the information on the form before he signed it. Thus, Faller asks us to reweigh the
evidence and make a credibility determination, which we may not do. Fisher, 648 F.3d at 450.
Next, Faller argues that his 26 U.S.C. § 7203 (willful failure to file) convictions must be
dismissed as lesser included offenses of his 26 U.S.C. § 7201 (tax evasion) charges. See United
States v. Ehle, 640 F.3d 689, 697 (6th Cir. 2011) (holding that a conviction under two statutory
provisions violates the Double Jeopardy clause where one constituted a lesser included offense
of the other). The § 7203 charges were based on Faller’s failure to file taxes by each year’s
filing deadline. (R. 1, Indictment, PID 9.) However, Faller’s tax evasion charges were not based
on a failure to file on time; they were based on the charge that, when he did file, the returns were
false. (Id. at PID 4–8.) Thus, Faller’s conviction of tax evasion does not call for dismissal of his
willful failure to file charges as lesser included offenses—the two charges contain separate

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elements based on distinct conduct. The Double Jeopardy clause is not implicated. See also
United States v. Becker, 965 F.2d 383, 391 (7th Cir. 1992).
Faller makes two final arguments. First, he asserts that the government improperly
bolstered Special Agent Sauber during closing arguments when it made the following statement:
I want to suggest to you that one of the people that’s tasked with doing a hard job
is this fine agent behind me, Matt Sauber, who has been the subject of an
unrelenting bombardment of insults and invectives during this case. I have been a
prosecutor for 30 years. You can’t offend me with a two-by-four, but I am
offended when someone who is trying to do their job is attacked like he has been
attacked in this case.
(R. 263, Trial Transcript, PID 5856.) Faller says this statement crossed the line into
improper bolstering of Sauber and that, because Sauber’s credibility was critical to the case, the
error was not harmless. We apply a two-step test to claims of prosecutor misconduct. “First, we
determine whether the statements were improper. Second, we ask whether the remarks were so
flagrant as to warrant reversal.” United States v. Boyd, 640 F.3d 657, 669 (6th Cir. 2011).
Here, we resolve the issue at the first step: the statement was not improper. “Improper
vouching occurs when a prosecutor supports the credibility of a witness by indicating a personal
belief in the witness's credibility thereby placing the prestige of the office of the United States
Attorney behind that witness.” United States v. Francis, 170 F.3d 546, 550 (6th Cir. 1999).
“Generally, improper vouching involves either blunt comments . . . or comments that imply that
the prosecutor has special knowledge of facts not in front of the jury or of the credibility and
truthfulness of witnesses and their testimony.” Id. (internal citations removed). Here, the
prosecutor’s comment is neither blunt nor implicit vouching—in fact, it does not speak to
Sauber’s credibility at all. Rather, read in context, the statement was intended to cast doubt on
Faller’s efforts to paint Sauber as a critical player in a government conspiracy to “get Faller.”
This conduct does not amount to improper bolstering.
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Faller’s final argument is that the district court erred in failing to hold a Franks hearing
on his motion to suppress evidence found pursuant to the executed search warrant of his home
and office. We review the district court’s findings of fact for clear error and legal conclusions de
novo. United States v. Graham, 275 F.3d 490, 505 (6th Cir. 2001). A defendant is entitled to a
Franks hearing if he “makes a substantial preliminary showing that a false statement knowingly
and intentionally, or with reckless disregard for the truth, was included by the affiant in the
warrant affidavit” and that “the allegedly false statement is necessary to the finding of probable
cause.” Id. (emphasis added).
Faller has made no such showing. The warrant affidavit was prepared by Special Agent
Sauber and was based on information provided by a confidential source later revealed to be
Faller’s long-time assistant, Kelly Sullivan. Faller baldly claims that much of the information
provided by Sullivan was false and unsubstantiated and that she was a de facto government agent
(yet another bit player in the perceived conspiracy). But Faller has proffered no evidence to
show the affiant, Sauber, either knowingly and intentionally, or with disregard for the truth,
included any false statements in the affidavit. Faller does not even specify a single statement
included in the affidavit that may have been false. A defendant is not entitled to a Franks
hearing by broadly claiming information in an affidavit is false—Faller must make the
substantial preliminary showing that Sauber was at least reckless as to this fact. Faller has not
done so. Thus, the district court did not err by denying him a Franks hearing.
II.
For the foregoing reasons, Faller’s conviction is AFFIRMED.

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