Billion-dollar tax scammers ask 11th Circuit for new trial

ATLANTA (CN) — An 11th Circuit panel on Wednesday appeared likely to order a new federal trial for two Georgia defendants convicted in a billion-dollar tax deduction scheme after hearing arguments that a juror likely to acquit them was removed during deliberations for injecting race into the proceedings.

Attorneys for accountant Jack Fisher and his codefendant James Sinnott, a former securities attorney, asked the Atlanta-based appellate panel to overturn their convictions for conspiracy, wire fraud and filing false tax returns. Fisher was also convicted of money laundering.

The defendants’ attorneys argued a Georgia federal judge unfairly removed a holdout juror who said she was a “white person standing up for white people.” The juror made the statement while being questioned alone by the judge over heated arguments in the jury room.

“An expression of identity with the defendants does not mean there is no possibility the juror is not deciding the case based on the law and the evidence,” attorney James Cooney III of Womble Bond Dickinson argued on Fisher’s behalf.

The juror also claimed to have overheard Black jurors saying they would “find [the defendants] guilty because they were white, rich and entitled.” The lower court ruled the accusation was false.

An attorney for the government urged the panel to uphold the convictions, pointing out that the jury continued deliberating for two full days after the juror was removed and chose to acquit a white codefendant of all charges.

Fisher and Sinnott were sentenced last year to 25 and 23 years in prison, respectively, for promoting and operating an illegal tax shelter. The tax shelter hid fraudulently appraised conservation easements from the IRS, netting big tax savings for the defendants’ clients.

The easements were donated to conservation nonprofits to create charitable deductions which flowed through to the defendants’ wealthy clients.

According to the government, clients obtained a $112,500 deduction for every $25,000 unit they purchased. The shelters claimed more than $1.3 billion in deductions between 2013 and 2019.

Government calculations found the defendants made over $114 million in fees between 2008 and 2019. Fisher and Sinnott were ordered to pay $457 million and $443 million respectively in restitution to the IRS.

Cooney and attorney Donald Samuel of Garland Samuel & Loeb argued on Wednesday that the lower court’s decision to question the juror ex parte — in the judge’s chambers, away from the defendants and their attorneys — was unfair.

Samuel, who represents Sinnott, said U.S. District Judge Timothy C. Batten Sr. considered the juror’s body language, tone of voice and facial expressions in weighing her credibility — all ambiguous factors the defense did not get to clarify.

Cooney raised similar objections, telling the panel, “[Batten] made a series of credibility findings which are essentially irrefutable because nobody was there in the room except him.”

In a written order, Batten explained he felt questioning jurors in his chambers was less intimidating and “more likely to facilitate discovery of the truth.”

All three judges on the appellate panel expressed disapproval of that choice.

U.S. Circuit Judge Britt Grant, an appointee of Donald Trump, said it was “safe to say” that ex parte interviews of jurors are “not generally what we recommend.”

But Department of Justice attorney Jason Poole argued that it would not have mattered if the questioning took place in the courtroom because Batten was the ultimate fact-finder.

“The judge is the one who’s the neutral decisionmaker,” Poole said. “If [the defense] could say I disagree that that look meant that, that wouldn’t change how the judge reviewed or assessed or made his credibility determination.”

U.S. Circuit Judge Robin Rosenbaum, a Barack Obama appointee, pointed out that Batten made an initial decision to keep the juror on the jury after the ex parte interviews occurred, only to inexplicably reverse course days later.

Batten initially denied the government’s motion to remove the juror during deliberations, finding that she could base her decision on the evidence.

But the judge reversed himself in an order issued three days later. Finding the juror “not credible” and “untruthful” for falsely accusing three Black jurors of making race-based commentary about the defendants, Batten ruled that the juror’s “shocking” statement tied her deliberations with the defendants’ race.

“With each passing hour, the court experienced more angst over having allowed an apparently racist juror to remain among the venire,” Batten wrote. “By Wednesday morning (Sept. 20), the court changed its mind and concluded that removing juror 26 was the only way to preserve the sanctity of this trial, regardless of whether the juror was inclined to vote for acquittal.”

U.S. Circuit Judge Elizabeth Branch noted the judge had “no other interaction” with the juror between his decisions.

Branch, an appointee of Donald Trump, also questioned what the panel should make of Batten’s admissions that he asked the jury what the vote split was — a move Cooney characterized as “extremely troubling,” “coercive” and “forbidden under federal law for about 100 years.”

Poole agreed the trial judge should not have asked about the split, but said the defendants failed to show they were prejudiced by the question.

The panel did not indicate when a decision will issue in the appeal.

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