United States v. Ellefsen, No. 10-2857 (8th Cir. 2011)
Annotate this CaseDefendants, Brian Keith Ellefson and Mark Edward Ellefsen, were convicted of conspiracy to defraud the United States by obstructing the IRS in the assessment and collection of federal taxes. Brian was also convicted of three counts of filing false income tax returns while Mark was convicted of three counts of aiding and assisting the preparation of false income tax returns. Defendants appealed their convictions and challenged the restitution order. The court held that because the undisclosed information at issue was not material, there was no Brady violation. The court also held that, although the defense should have been allowed to cross-examine a certain government witness regarding a tax-loss calculation and whether she considered Brian's additional payments, any error in denying the cross-examination was harmless beyond a reasonable doubt. The court further held that the district court did not abuse its discretion in excluding defendants' proposed expert testimony under Federal Rule of Evidence 403. The district court also did not err in denying the motion for judgment of acquittal and did not abuse its discretion in denying the motion for a new trial where the record was replete with evidence to support the jury's finding that defendants acted willfully. The court finally held that there was no clear error in the district court's judgment of restitution where the government met its burden of proof and deducted Brian's additional payments from the amount of restitution owed to the IRS. Accordingly, the convictions and restitution orders were affirmed.
Court Description: Criminal case - criminal law. Brady argument rejected as the defendants failed to show undisclosed IRS internal documents contained material information, the disclosure of which would have affected the outcome of their trial; no error in allowing government witness to testify that funds flowing through the tax avoidance scheme constituted constructive dividends; while additional cross-examination into the witness's testimony should have been allowed under Rule 611(c), the error was harmless beyond a reasonable doubt; no error in excluding defendants' proposed expert testimony as it had only slight relevance to the issue of the defendants' willfulness and would have sidetracked the proceedings; evidence was sufficient to show defendants willfully used a series of offshore and domestic entities to avoid paying federal income tax; the district court did not err in calculating defendants' restitution.
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