United States v. Wood

943 F.2d 1048 (9th Cir. 1991)

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Nature of the Case

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Facts

D ran an investment scam and eventually was caught. A federal grand jury brought a two-count indictment against d, charging him with two counts of tax evasion (violations of I.R.C. § 7201) for tax years 1983 and 1984, respectively. D argued that his commodities-related trading losses were fully deductible as business losses under I.R.C. § 165(a) and (c), and thus, his tax liability for the years 1983 and 1984 was insubstantial. P contends that the commodities losses were capital losses, and were subject to a limit on deductibility. Bob Marcinek, an IRS agent, testified as an expert on behalf of P. Marcinek testified as to his opinion of D's tax liability, which he summarized in two charts. The government moved to admit the charts into evidence; the motion was granted without objection. D offered its expert, Larry Richter, to testify about D's tax liability. Richter filled in a chart outlining his version of the correct tax calculations. D moved to admit the chart into evidence. P objected, claiming that the chart was a 'misapplication of the law.' The district court sustained the objection. The court permitted Wood to use the chart during closing arguments, so long as the figures concerning business loss deductions were masked. D was convicted and appealed.