Tracy L. Perzel, Assistant United States Attorney, for Plaintiff.
Daniel J. Gerdts for Defendant Schlegel.
Shannon R. Elkins, Assistant Federal Defender, for Defendant Collin.
REPORT & RECOMMENDATION
FRANKLIN L. NOEL, Magistrate Judge.
THIS MATTER came before the undersigned United States Magistrate Judge on June 26, 2013 on the defendants' pretrial motions. The matter was referred to the undersigned for a report and recommendation pursuant to 28 U.S.C. § 636 and Local Rule 72.1. The government called one witness at the hearing, IRS Special Agent Timothy Nichols, and entered four items into evidence. For the reasons set forth below, the Court recommends that the defendants' motions be denied.
I. FINDINGS OF FACT
On March 25, 2013, IRS Special Agent Timothy Nichols and IRS Special Agent Andy Gilbart visited the office of the defendant Michael Andrew Schlegel, in Maple Grove, MN, to deliver an invitation to Schlegel to appear before a grand jury. The two agents entered the main door of the office and were greeted by Schlegel's wife, who was working at the reception desk. Both agents were wearing coats or jackets that concealed their firearms. They asked for Schlegel. Schlegel appeared and spoke with the two agents in the reception area of the office suite. The two agents handed him an envelope containing the invitation letter and then asked him to let them know by April 1, 2013 whether he would appear before the grand jury. Special Agent Nichols asked if Schlegel was represented by a lawyer. Gov.'s Ex. 4. Schlegel responded that he did not have a lawyer because he could not afford one.
The two agents discussed with Schlegel some procedural matters related to the indictment. Before discussing those matters, the two agents asked him if he would like to move the conversation to somewhere more private. The agents asked because when Special Agent Nichols previously served Schlegel with a target letter at the same location, Schlegel claimed that Nichols was trying to embarrass him. So the two agents and Schlegel moved to a conference room somewhere in the office suite. At some point during the agents' conversation with Schlegel, they informed him that he would be indicted on charges of tax evasion in April 2013 if the grand jury agreed with the government's theory of the case.
Schlegel did not appear to Special Agent Nichols to be impaired physically or mentally at any point during their conversation on March 25. The tone of the interaction was, according to Special Agent Nichols, "conversational." Schlegel asked whether he could do a presentation and play some audio or video to the grand jury. Nichols responded that he did not know and would have to get back to him. The entire conversation lasted approximately twenty minutes.
II. CONCLUSIONS OF LAW
A. Defendant Collin's motion to dismiss count 1
Defendant Collin moves to dismiss count 1 because he contends that the count is predicated on acts beyond the statute of limitations. Count 1 charges Defendant Collin with conspiracy to defraud the United States by impairing and impeding the functions of the Internal Revenue Service in violation of 18 U.S.C. § 371. The statute of limitations for that crime is six years. 26 U.S.C. § 6531(1). "In a conspiracy charge, the limitations period begins to run from the occurrence of the last overt act in furtherance of the conspiracy that is set forth in the indictment." United States v. Mueller, 661 F.3d 338, 347 (8th Cir. 2011). In other words, the government must allege and prove the commission of "at least one overt act by one of the conspirators" in furtherance of the conspiracy within the limitations period. United States v. Dolan, 120 F.3d 856, 864 (8th Cir. 1997) (emphasis added).
Because the indictment in this case was filed on April 9, 2013, that overt act must have been committed at some point after April 9, 2007 in order for the alleged crime to fall within the statute of limitations. The government has alleged such an act. The indictment alleges that - in September 2007, September 2008, September 2009, and September 2010 - Defendant Schlegel filed false tax returns concealing the nature and extent of Defendant Collin's ownership interest in TMM/NatureRich. ECF No. 1 at ¶ 18 (r)-(t). The indictment also alleges that the conspiracy existed within the limitations period. See id. at ¶ 4 ("At various times between 2002 and 2009, Schlegel and Collin received wages and commission payments from TMM/NatureRich totaling more than $500, 000.00 and $350, 000.00 respectively."). Although Defendant Collin asserts in his brief that he "was not privy" to the corporate-tax-return filings, he ...