We consider here the fate of four partners and employees of Ernst & Young, LLP (“E&Y”),
one of the largest accounting firms in the world, who appeal their convictions in connection with the
development and defense of five “tax shelters” that were sold or implemented by E&Y between
1999 and 2001. At issue, among other things, is the scope of criminal liability in a conspiracy to
defraud the United States under 18 U.S.C. § 371 and the sufficiency of the evidence with respect to
the criminal intent of certain defendants.
The defendants in these consolidated actions are three tax attorneys, Robert Coplan, Martin
Nissenbaum, and Richard Shapiro, and one accountant, Brian Vaughn, formerly employed by E&Y.
A fifth defendant, Charles Bolton, was an investment advisor who owned and operated various
asset-management companies. Coplan, Nissenbaum, Shapiro, and Vaughn (jointly, the “trial
defendants”) appeal from separate judgments of conviction entered by the United States District
Court for the Southern District of New York (Sidney H. Stein, Judge) on February 17, 2010,
following a 10-week jury trial on charges of conspiracy to defraud the Government, tax evasion,
obstruction of the Internal Revenue Service (“IRS”), and false statements to the IRS. Bolton
appeals from a judgment of conviction entered by the District Court on April 14, 2010, following his
plea of guilty to a single conspiracy charge.
For the reasons that follow, we reverse the convictions of Shapiro and Nissenbaum on
Counts One, Two, and Three, and the conviction of Nissenbaum on Count Four, and we affirm the
convictions of Coplan and Vaughn in their entirety. We affirm the District Court’s order sentencing Bolton principally to 15 months of imprisonment, but we vacate and remand the portion of the judgment that imposed a fine of $3 million. ....
Dissent: I respectfully dissent from so much of the Majority Opinion as finds the evidence insufficient to support (1) the convictions of defendants Richard Shapiro and Martin Nissenbaum of conspiracy, in violation of 18 U.S.C. § 371, to (a) defraud the United States by impairing the lawful functions of an agency of the United States government, to wit, the Internal Revenue Service ("IRS"), (b) commit tax evasion, see 26 U.S.C. § 7201, and (c) make false statements to the IRS, see 18 U.S.C. § 1001 (Count One); and (2) those two defendants' convictions of attempted tax evasion in violation of 26 U.S.C. § 7201 (Counts Two and Three).