Tax Notes Quotes Scott Michel on Tax Conspiracy Cases

The Eighth Circuit’s first word on whether the Supreme Court’s new requirements for a tax obstruction conviction also apply to tax conspiracy charges won’t be the — or maybe even its — last.

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Before Flynn filed his motion for rehearing, Scott Michel of Caplin & Drysdale told Tax Notes that the panel’s brief discussion of the argument that Marinello has an effect on tax conspiracies “does not reflect the depth of the legal position that one could raise if you had the right case to attack a Klein conspiracy.”

The stance of Flynn trying to withdraw his guilty plea wasn’t a particularly good factual scenario for presenting the overlap argument, Michel said. A defendant with a different set of facts and presenting a case to a different panel might well be more successful on the legal argument connecting Marinello to Klein conspiracies, he said.

Further, tax conspiracy charges add a possible vagueness argument if the defense raises the application of the agreement element — the element clearly required by conspiracy charges but not tax obstruction charges — to the particular defendant, Michel said. Some cases could involve disputes over whether the supposed conspirators agreed on the same thing and whether that thing fits the Klein “impair, impede, or obstruct the IRS” standard, he said.

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