Lawyer Could Face Jail for Voir Dire Question

From ABA Journal.com:

A federal magistrate has found patent lawyer John van Loben Sels in contempt of court and threatened him with a 48-hour jail sentence for a question he asked during voir dire.

Van Loben Sels asked potential jurors in a patent infringement suit whether they had "a problem with a company that puts its headquarters offshore on a Caribbean island in order to avoid paying U.S. taxes," the Recorder reports. He is a partner with Wang, Hartmann, Gibbs & Cauley of Mountain View, Calif.

U.S. Magistrate Judge Charles Everingham IV of Marshall, Texas, had prohibited Van Loben Sels and other lawyers for Beyond Innovation Technology Co., a defendant in a patent suit, from saying anything about the tax motivation for the Cayman Islands home of the plaintiff, O2 Micro.

Everingham said Van Loben Sels would not have to serve the sentence if he behaved for the rest of the case, according to the story. But he granted a mistrial and imposed other sanctions on Beyond Innovation Technology Co., known as BiTEK. It will have to foot the bill for new jury selection, will get half the voir dire time of its opponent and will get two peremptory challenges instead of four, according to the Recorder.

Van Loben Sels had defended his question, saying it was hypothetical and he didn't refer to O2 Micro by name.

US-Swiss Tax-Evasion Hearings Set In Fla.

The date of the hearings for the US-Swiss tax evasion cases have been set for this July in Florida. The case is already drawing global publicity, as so many different economies are being affected by off shore tax evasion.

Earlier today the Examiner posted a new article on the topic. Check out a snippet of their story below, and be on the look out for an entry I am working on that will explain how offshore tax evasion affects you!

During the global economic crisis, Switzerland, like other havens for tax evasion, have been increasingly facing scrutiny. Alongside the US, Germany, France and Britain have also been pressuring Switzerland to assist them in closing loopholes for tax evasion. A federal Florida judge has set hearings on July 13 to 15 on the Internal Revenue Service's endeavor to obtain 52,000 names of U.S. account holders of the UBS AG.

Initially, UBS refused to release 52,000 names, since it stated the release would violate the privacy laws of Swiss banking. UBS has already paid $789 mil. in fines and agreed to settle allegations it helped Americans evade taxes. The UBS holds $2 trillion in foreign money and its financial services constitute 12 percent of Switzerland's economic output.

"This Administration is committed to reducing off shore tax evasion to help ensure that all U.S. taxpayers are playing by the same rules," Timothy Geithner, the Secretary of Treasury, said in a Friday press release.

The UBS has proposed to release data on some of its American account-holders----with no names or account numbers attached.

Tax Trial Opens For 'Dancing With The Stars' Champ

From the Associated Press:

On top of the world a few months ago, Brazilian race car driver and "Dancing with the Stars" champ Helio Castroneves faces possible prison time if convicted at a tax evasion trial that began Monday with jury selection.

Castroneves, a two-time winner of the Indianapolis 500, smiled broadly as he entered Miami's downtown federal courthouse. Prosecutors say Castroneves, his business-manager sister Katiucia and Michigan attorney Alan R. Miller conspired to hide about $5.5 million in income from the Internal Revenue Service using offshore accounts.

Castroneves claims he relied on experts to advise him on handling finances. He also says his father controlled a Panamanian entity called Seven Promotions at the heart of the prosecution's case.

Castroneves claims the money Seven Promotions received wasn't his tax liability because the income was for his father, who had financed and promoted his son's career for over 10 years.

Castroneves, his sister and Miller also deny acting "willfully" to evade taxes and that they took improper deductions.

Under federal sentencing guidelines, Castroneves, 33, could get more than six years in prison if convicted of conspiracy and tax evasion from 1999 to 2004. That would short-circuit a brilliant racing career that began in Sao Paulo, Brazil, where a youthful Castroneves broke into the sport by driving go-carts.

Trial set to Begin in NY Tax Shelter Case

From NewsDay.com:

It was a prosecution once touted as the biggest tax fraud case in history. Now four remaining KPMG defendants are going on trial, accused of conspiring to help at least 600 wealthy people evade more than a billion dollars in taxes.

There were once 19 defendants, most of them former partners at the accounting giant. Two cut deals with prosecutors. Charges against the rest were dismissed after U.S. District Judge Lewis A. Kaplan concluded that prosecutors had unfairly pressured KPMG to break promises to pay employee legal expenses.

The three former KPMG executives and a lawyer who remain in the case are charged with conspiring to obstruct the Internal Revenue Service, evading taxes and filing false tax returns. The trial, with jury selection on Tuesday, is scheduled to last four months or longer.

Prosecutors say the men conspired to market complex tax shelters from 1997 until 2000 to wealthy individuals who wanted to dodge taxes.

In court papers, lawyers said the defendants acted legally and that any questionable tax shelters were challenged by the IRS and appropriate taxes were paid.

The defense said the government was seeking "to poison the jury with allegations of tax evasion far beyond anything it can or will even try to prove."