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United States v. Stadtmauer - 620 F.3d 238 (3d Cir. 2010)


Fed. R. Evid. 701 limits lay testimony in the form of opinions or inferences to those which are (a) rationally based on the perception of the witness, and (b) helpful to a clear understanding of the witness' testimony or the determination of a fact in issue. Rule 701 represents a movement away from courts' historically skeptical view of lay opinion evidence, and is rooted in the modern trend away from fine distinctions between fact and opinion and toward greater admissibility. The Rule is nonetheless designed to exclude lay opinion testimony that amounts to little more than choosing up sides or that merely tells the jury what result to reach. Lay testimony in the form of an opinion about what a defendant did or did not know often comes dangerously close to doing just this


Kushner controls hundreds of limited partnerships, each of which owns and manages a single commercial or residential property. Charles and Murray Kushner accused each other of taking more than his fair share out of their common businesses. During the course of the ensuing civil litigation, Murray alerted federal authorities to potential misconduct by his brother and Kushner Companies (KC). As a result of its investigation of Kushner, the Government indicted several other individuals, including defendant Stadtmauer--a Certified Public Accountant.  Defendant appealed from the United States District Court for the District of New Jersey, where he was convicted of one count of conspiracy to defraud the United States, in violation of 18 U.S.C.S. § 371, and nine counts of willfully aiding in the filing of materially false or fraudulent tax returns, in violation of 26 U.S.C.S. § 7206(2). The district court sentenced him to 38 months' imprisonment. Stadtmauer argues that the District Court erred in giving a willful blindness instruction to the jury’.


Did the District Court err in giving a willful blindness instruction to the jury?




Affirming, the court concluded that a willful blindness instruction that applied to a defendant's knowledge of the law in a criminal tax case would not run afoul of Cheek v. United States. Though the question whether an accountant’s lay opinion testimony was admissible under Fed. R. Evid. 701 was close, the court concluded that the error, if any, was harmless. In addition, the court rejected defendant's prosecutorial misconduct claim based on the Government's supposed failure to "correct" a witness's testimony that he could not recall statements he purportedly made to FBI agents (with Government counsel present) during investigatory interviews. Finally, the court concluded that the district court did not abuse its discretion in either (1) admitting the expert testimony of an IRS agent in defendant's complicated tax fraud case, and (2) preventing defendant from affirmatively admitting certain categories of exhibits into evidence during defense counsel's cross-examination of Government witnesses.

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