Date: 02-08-2018

Case Style:

Case Number: 16-4282

Judge: Per Curiam

Court: United States Court of Appeals for the Eighth Circuit on appeal from the Western District of Missouri (Jackson County)

Plaintiff's Attorney: Russell J. Edelstein

Defendant's Attorney: Matt Diehr and Mark Milton

Description: George and Cookie Pate appeal the district court’s2 enforcement of summonses
issued by the Internal Revenue Service (“IRS”) in April 2015. The summonses
directed the Pates to provide testimony regarding alleged tax deficiencies. The Pates
appeared before IRS Officer Mark Boston and invoked the Fifth Amendment
privilege in response to every question, including questions about their names,
telephone numbers, and dates of birth.
The Government petitioned to enforce the summonses in district court. The
district court referred the case to a magistrate judge, who held a hearing. The Pates
did not testify, but their attorney argued that they reasonably feared prosecution
largely due to Boston’s interest in a criminal referral for the case. The Pates’ attorney
did not identify particular objectionable questions, however, even though the
Government had argued in a prior brief that the blanket assertion of the Fifth
Amendment privilege was improper. The magistrate judge recommended enforcing
the summonses, and the district court adopted that recommendation. The Pates
appealed.
Under Internal Revenue Code § 7602, the IRS has authority to issue a
summons to determine tax liability. “If a taxpayer does not comply with a summons,
the IRS may bring an enforcement action in district court.” United States v. Clarke,
134 S. Ct. 2361, 2365 (2014) (citing 26 U.S.C. §§ 7402(b), 7604(a)). In an
2The Honorable Brian C. Wimes, United States District Judge for the Western
District of Missouri, adopting in relevant part the report and recommendations of the
Honorable Matt J. Whitworth, Chief Magistrate Judge, United States District Court
for the Western District of Missouri.
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enforcement action, the district court considers the Powell factors—factors that the
Pates concede have been met. See Clarke, 3 134 S. Ct. at 2365 (discussing United
States v. Powell, 379 U.S. 48, 57-58 (1964)).
The Pates instead argue that the Fifth Amendment prevents the enforcement of
the summonses. The Fifth Amendment provides: “No person . . . shall be compelled
in any criminal case to be a witness against himself.” “The fifth amendment
privilege, however, does not encompass the complete refusal to disclose any
information relating to income.” United States v. Russell, 585 F.2d 368, 370 (8th Cir.
1978). The claimant must “make specific objections in response to specific
questions.” United States v. Dick, 694 F.2d 1117, 1119 (8th Cir. 1982) (per curiam).
Those objections must show that he “is confronted by substantial and ‘real’, and not
merely trifling or imaginary, hazards of incrimination.” Daly v. United States, 393
F.2d 873, 878 (8th Cir. 1968). “The claimant need not incriminate himself in order
to invoke the privilege, but if the circumstances appear to be innocuous, he must
make some positive disclosure indicating where the danger lies.” Ueckert v. C.I.R.,
721 F.2d 248, 250 (8th Cir. 1983). Yet to repeat: a taxpayer cannot assert the
privilege to every question asked by the examiner when some of the questions are
innocuous on their face. See Daly, 393 F.2d at 878.
Because the Pates asserted the privilege in response to all of Boston’s
questions, including ones innocuous on their face, we affirm the district court’s
enforcement of the summonses. See id. At least three other decisions in our circuit
3In their reply brief, the Pates contend that the Powell factors were not met for
certain questions. This claim comes too late. See Tension Envelope Corp. v. JBM
Envelope Co., 876 F.3d 1112, 1120 (8th Cir. 2017). In their opening brief, the Pates
stated: “Appellants never argued that the Powell factors were not met with respect
to the April Summonses.”
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have done so in similar circumstances. See United States v. G & G Advert. Co., 762
F.2d 632, 634-35 (8th Cir. 1985); Dick, 694 F.2d at 1119; United States v. Jones, 538
F.2d 225, 226 (8th Cir. 1976) (per curiam). We are bound by these decisions.4
The parties also ask us to address whether the Pates have a “substantial” and
“real” fear of self-incrimination, see Daly, 393 F.2d at 878, but we decline to reach
this broader question. The sufficiency of the fear may depend on the particular
question posed. See Dick, 694 F.2d at 1119. Nor do we address whether, if the Pates
are questioned again pursuant to the April summonses, this decision precludes them
from invoking the Fifth Amendment privilege to questions already posed.
Addressing that issue would be premature. The Government argues for preclusion
by citing Olson v. United States, but Olson involved the preclusive effect of an
enforcement order in a later contempt proceeding. See 872 F.2d 820, 822 (8th Cir.
1989). If subsequent questioning pursuant to the summonses leads to a contempt
proceeding, then the district court conducting the proceeding can address preclusion.
That decision would then be subject to review. See United States v. Baker, 721 F.2d
647, 649-50 (8th Cir. 1983) (per curiam); see also Daly, 393 F.2d at 876-78.

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4The Pates suggest in their reply brief that if they had answered any question,
the Government would have argued under a waiver theory that they needed to answer
every question. The Pates cite a portion of the Government’s brief before the
magistrate judge to support this assertion, but the cited pages do not do so. In those
pages, the Government merely claimed that the Pates could not refuse to answer
questions about information already disclosed.
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Outcome: Because the Pates asserted the Fifth Amendment privilege in response to all of
Boston’s questions, we affirm the district court’s enforcement of the summonses.

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