KAWASHIMA v. HOLDER
Akio Kawashima and Fusako Kawashima are natives and citizens of Japan. The Kawashimas were admitted to the United States as lawful permanent residents in 1984. Nearly 10 years later, Akio Kawashima pleaded guilty to subscribing to a false statement on a federal tax return, and Fusako Kawashima pleaded guilty to aiding and assisting in preparing the false tax return statement.
Immigration officials began proceedings to deport the couple who had failed to report more than $245,126 in taxable income from two restaurants they own. Anything more than $10,000 is considered an aggravated felony, and the United States Court of Appeals for the 9th Circuit upheld their deportation.
Is filing a false statement on a corporate tax return an aggravated felony involving fraud or deceit, which would render the immigrant removable?
Legal provision: 26 U.S.C. Section 7206
Yes. Justice Clarence Thomas delivered the opinion of the Court, affirming the judgment of the appellate court. The Court held that filing a false tax return in violation of 26 U.S.C. Section 7206 qualifies as an aggravated felony under the Immigration and Nationality Act when the Government's revenue loss exceeds $10,000. The Court rejected the argument that crimes under Section 7206 do not involve the fraud or deceit required by the Immigration and Nationality Act.
Justice Ruth Bader Ginsburg filed a dissenting opinion which Justice Stephen Breyer and Justice Elena Kagan joined. Justice Ginsburg wrote that the Court's construction of the statute was dubious because it characterized a tax crime as a crime of fraud or deceit, which would render the portion of the statute which directly addressed violations of tax law meaningless.
NOTICE: This opinion is subject to formal revision before publication in the preliminary print of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Washington, D. C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
AKIO KAWASHIMA, et ux., PETITIONERS v. ERIC H. HOLDER, Jr., ATTORNEY GENERAL
on writ of certiorari to the united states court of appeals for the ninth circuit
[February 21, 2012]
Justice Thomas delivered the opinion of the Court.
This case concerns whether aliens who commit certain federal tax crimes are subject to deportation as aliens who have been convicted of an aggravated felony. We hold that violations of 26 U. S. C. §§7206(1) and (2) are crimes “involv[ing] fraud or deceit” under 8 U. S. C. §1101(a)(43)(M)(i) and are therefore aggravated felonies as that term is defined in the Immigration and Nationality Act, 8 U. S. C. §1101 et seq., when the loss to the Government exceeds $10,000.I
Petitioners, Akio and Fusako Kawashima, are natives and citizens of Japan who have been lawful permanent residents of the United States since June 21, 1984. In 1997, Mr. Kawashima pleaded guilty to one count of willfully making and subscribing a false tax return in violation of 26 U. S. C. §7206(1). Mrs. Kawashima pleaded guilty to one count of aiding and assisting in the preparation of a false tax return in violation of 26 U. S. C. §7206(2).
Following their convictions, the Immigration and Naturalization Service charged the Kawashimas with being deportable from the United States as aliens who had been convicted of an aggravated felony. 1 See 8 U. S. C. §1227(a)(2)(A)(iii) (“Any alien who is convicted of an aggravated felony at any time after admission is deportable”). 2 In the Immigration and Nationality Act, Congress listed categories of offenses that qualify as “aggravated felonies” for the purpose of deportation. See §1101(a)(43). Here, the Government charged the Kawashimas with being deportable for committing offenses under subparagraph (M) of §1101(a)(43). That subparagraph classifies as an aggravated felony an offense that either: “(i) involves fraud or deceit in which the loss to the victim or victims exceeds $10,000; or (ii) is described in section 7201 of title 26 (relating to tax evasion) in which the revenue loss to the Government exceeds $10,000.” Hereinafter, we refer to §1101(a)(43)(M)(i) as “Clause (i)” and to §1101(a)(43)(M)(ii) as “Clause (ii).”
At their deportation hearing, the Kawashimas argued that their convictions under 26 U. S. C. §7206 did not qualify as aggravated felonies under subparagraph (M). The Immigration Judge disagreed and ordered removal, concluding that the Kawashimas’ convictions qualified as aggravated felonies under Clause (i). The Kawashimas appealed the removal order to the Board of Immigration Appeals (Board), which affirmed the Immigration Judge’s decision. After unsuccessfully petitioning the Board to reopen its decision, the Kawashimas filed petitions for review of the Board’s decision in the United States Court of Appeals for the Ninth Circuit.
The Ninth Circuit held that “convictions for violating §§7206(1) and (2) in which the tax loss to the Government exceeds $10,000 constitute aggravated felonies under subsection (M)(i).” 615 F. 3d 1043, 1053 (2010). The court concluded that Mr. Kawashima’s conviction under §7206(1) qualified as an aggravated felony within Clause (i)’s definition “because it involved ‘fraud or deceit’ and because his offense resulted in a loss to the government in excess of $10,000.” Id., at 1055. The Ninth Circuit also determined that Mrs. Kawashima’s conviction under §7206(2) “necessarily ‘involve[d] fraud or deceit.’ ” Id., at 1055. But because Mrs. Kawashima’s plea agreement was not in the administrative record, the Ninth Circuit remanded to the Board to determine whether Mrs. Kawashima’s conviction had caused a loss to the Government in excess of $10,000. Id., at 1056–1057.
We granted the Kawashimas’ petition for a writ of certiorari to determine whether their convictions for violations of 26 U. S. C. §§7206(1) and (2) respectively qualify as aggravated felonies under 8 U. S. C. §1101(a)(43)(M)(i). 563 U. S. ___ (2011). We now affirm.II
The Kawashimas argue that they cannot be deported for commission of an “aggravated felony” because crimes under §§7206(1) and (2) do not “involv[e] fraud or deceit” as required by Clause (i). The Kawashimas also assert that their convictions under §7206 are not “aggravated felonies” because tax crimes are not included within Clause (i) at all. We address each argument in turn.A
The Kawashimas contend that their offenses of conviction do not fall within the scope of Clause (i) because neither “fraud” nor “deceit” is a formal element of a conviction under §7206(1) or §7206(2). The Government responds that the Kawashimas’ convictions necessarily involved deceit because they required a showing that the Kawashimas willfully made materially false statements. To determine whether the Kawashimas’ offenses “involv[e] fraud or deceit” within the meaning of Clause (i), we employ a categorical approach by looking to the statute defining the crime of conviction, rather than to the specific facts underlying the crime. See Gonzales v. Duenas-Alvarez, 549 U. S. 183, 186 (2007) (applying the approach set forth in Taylor v. United States, 495 U. S. 575 –600 (1990)). If the elements of the offenses establish that the Kawashimas committed crimes involving fraud or deceit, then the first requirement of Clause (i) is satisfied. 3
Mr. Kawashima was convicted of violating 26 U. S. C. §7206(1), which provides that any person who “[w]illfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter,” shall be guilty of a felony. Mr. Kawashima does not dispute that the elements of a violation of §7206(1) include, inter alia, that the document in question was false as to a material matter, that the defendant did not believe the document to be true and correct as to every material matter, and that he acted willfully with the specific intent to violate the law. See, e.g., United States v. Aramony, 88 F. 3d 1369, 1382 (CA4 1996); United States v. Kaiser, 893 F. 2d 1300, 1305 (CA11 1990); United States v. Marabelles, 724 F. 2d 1374, 1380 (CA9 1984); United States v. Whyte, 699 F. 2d 375, 381 (CA7 1983). Although the words “fraud” and “deceit” are absent from the text of §7206(1) and are not themselves formal elements of the crime, it does not follow that his offense falls outside of Clause (i). The scope of that clause is not limited to offenses that include fraud or deceit as formal elements. Rather, Clause (i) refers more broadly to offenses that “involv[e]” fraud or deceit—meaning offenses with elements that necessarily entail fraudulent or deceitful conduct.
When subparagraph (M) was enacted, the term “deceit” meant a “the act or process of deceiving (as by falsification, concealment, or cheating).” Webster’s Third New International Dictionary 584 (1993). Mr. Kawashima’s conviction under §7206(1) establishes that he knowingly and willfully submitted a tax return that was false as to a material matter. He therefore committed a felony that involved “deceit.”
Turning to Mrs. Kawashima, our analysis follows a similar path. Mrs. Kawashima was convicted of violating 26 U. S. C. §7206(2), which declares that any person who “[w]illfully aids or assists in . . . the preparation or presentation under, or in connection with any matter arising under, the internal revenue laws, of a return, affidavit, claim, or other document, which is fraudulent or is false as to any material matter,” has committed a felony. Mrs. Kawashima does not dispute that the elements of a violation of §7206(2) include, inter alia, that the document in question was false as to a material matter and that the defendant acted willfully. See Aramony, supra, at 1382; United States v. Sassak, 881 F. 2d 276, 278 (CA6 1989); United States v. Hooks, 848 F. 2d 785, 788–789 (CA7 1988); United States v. Dahlstrom, 713 F. 2d 1423, 1426–1427 (CA9 1983). We conclude that Mrs. Kawashima’s conviction establishes that, by knowingly and willfully assisting her husband’s filing of a materially false tax return, Mrs. Kawashima also committed a felony that involved “deceit.”
The language of Clause (i) is clear. Anyone who is convicted of an offense that “involves fraud or deceit in which the loss to the victim or victims exceeds $10,000” has committed an aggravated felony and is subject to deportation pursuant to 8 U. S. C. §1227(a)(2)(A)(iii). The elements of willfully making and subscribing a false corporate tax return, in violation of 26 U. S. C. §7206(1), and of aiding and assisting in the preparation of a false tax return, in violation of 26 U. S. C. §7206(2), establish that those crimes are deportable offenses because they necessarily entail deceit.B
The Kawashimas’ second argument is based on inferences drawn from the interaction of Clause (i) and Clause (ii). The full text of subparagraph (M) reads as follows:
“(43) The term ‘aggravated felony’ means—
. . . . .
“(M) an offense that—
“(i) involves fraud or deceit in which the loss to the victim or victims exceeds $10,000; or
“(ii) is described in section 7201 of title 26 (relating to tax evasion) in which the revenue loss to the Government exceeds $10,000.”
The Kawashimas argue that when Clause (i) is read together with Clause (ii), Clause (i) must be interpreted as being inapplicable to tax crimes. In their view, subparagraph (M), when considered in its entirety, demonstrates that Congress was addressing two mutually exclusive categories of crimes in subparagraph (M)’s two clauses: general, non-tax crimes involving fraud or deceit that cause actual losses to real victims in Clause (i), and tax crimes involving revenue losses to the Government in Clause (ii). For the reasons discussed below, this argument cannot overcome the plain language of Clause (i), which encompasses the Kawashimas’ offenses of conviction.1
The Kawashimas contend that textual differences between Clauses (i) and (ii) indicate that Congress intended to exclude tax crimes from Clause (i). Specifically, they note that Clause (i) addresses “loss to the victim,” whereas Clause (ii) addresses “revenue loss to the Government.”
This difference in language does not establish Congress’ intent to remove tax crimes from the scope of Clause (i). Clause (i) covers a broad class of offenses that involve fraud or deceit. Clause (i) thus uses correspondingly broad language to refer to the wide range of potential losses and victims. Clause (ii), on the other hand, is limited to the single type of offense “described in section 7201 of title 26 (relating to tax evasion),” which, by definition, can only cause one type of loss (revenue loss) to one type of victim (the Government). Congress’ decision to tailor Clause (ii)’s language to match the sole type of offense covered by Clause (ii) does not demonstrate that Congress also intended to implicitly circumscribe the broad scope of Clause (i)’s plain language.2
Next, the Kawashimas argue that interpreting Clause (i) to include tax crimes violates the presumption against superfluities by rendering Clause (ii) completely redundant to Clause (i). Clause (ii) explicitly states that convictions for tax evasion pursuant to 26 U. S. C. §7201 that cause a revenue loss of at least $10,000 to the Government are aggravated felonies. The Kawashimas assert that, if Clause (i) applies to tax crimes, then qualifying convictions for tax evasion under Clause (ii) would also qualify as aggravated felonies under Clause (i), because tax evasion is a crime involving fraud or deceit. To buttress this argument, the Kawashimas point to a body of law providing that a conviction for tax evasion under §7201 collaterally estops the convicted taxpayer from contesting a civil penalty under 26 U. S. C. §6663(b) for “underpayment . . . attributable to fraud.” See, e.g., Gray v. Commissioner, 708 F. 2d 243, 246 (CA6 1983) (“Numerous federal courts have held that a conviction for federal income tax evasion, either upon a plea of guilty, or upon a jury verdict of guilt, conclusively establishes fraud in a subsequent civil tax fraud proceeding through application of the doctrine of collateral estoppel”). Therefore, according to the Kawashimas, if Clause (i) covers tax offenses, then Clause (ii) is mere surplusage.
We disagree with the Kawashimas’ contention that the specific mention of one type of tax crime in Clause (ii) impliedly limits the scope of Clause (i)’s plain language, which extends to any offense that “involves fraud or deceit.” We think it more likely that Congress specifically included tax evasion offenses under 26 U. S. C. §7201 in Clause (ii) to remove any doubt that tax evasion qualifies as an aggravated felony.
Several considerations support this conclusion. Like §§7206(1) and (2), §7201 does not, on its face, mention fraud or deceit. Instead, §7201 simply provides that “[a]ny person who willfully attempts in any manner to evade or defeat any tax imposed by [the Internal Revenue Code] or the payment thereof shall, in addition to other penalties provided by law, be guilty of a felony.” Accordingly, neither fraud nor deceit is among the elements of a conviction under §7201, which include: (1) willfulness; (2) the existence of a tax deficiency; and (3) an affirmative act constituting an evasion or an attempted evasion of the tax. Boulware v. United States, 552 U. S. 421 , n. 2 (2008). A conviction under §7201, therefore, only qualifies as an aggravated felony under Clause (i) if a willful, affirmative attempt to evade a tax necessarily entails fraud or deceit.
This Court’s decision in United States v. Scharton, 285 U. S. 518 (1932) , gave Congress good reason to doubt that a conviction under §7201 satisfies that condition. In Scharton, the defendant was indicted for attempting to evade income taxes by falsely understating his taxable income. The question before the Court was whether the crime was subject to the 3-year statute of limitations generally applicable to tax crimes, or whether it was instead subject to the 6-year statute of limitations applicable to “ ‘offenses involving the defrauding or attempting to defraud the United States or any agency thereof, whether by conspiracy or not, and in any manner.’ ” Id., at 520, n. 2 (quoting 18 U. S. C. §585 (1962 ed., Supp. V)). The Government argued that the 6-year statute of limitations applied because “fraud is implicit in the concept of evading or defeating” and because any effort to evade a tax is tantamount to an attempt to defraud the taxing body. 285 U. S., at 520–521. The Court rejected that argument, noting that, in an indictment for evasion, “an averment [of intent to defraud] would be surplusage, for it would be sufficient to plead and prove a willful attempt to evade or defeat.” Id., at 521.
Moreover, §7201 includes two offenses: “the offense of willfully attempting to evade or defeat the assessment of a tax as well as the offense of willfully attempting to evade or defeat the payment of a tax.” Sansone v. United States, 380 U. S. 343, 354 (1965) (emphasis in original). As the Government notes, it is possible to willfully evade or defeat payment of a tax under §7201 without making any misrepresentation. For example, §7201 can be violated by a taxpayer who files a truthful tax return, but who also takes affirmative steps to evade payment by moving his assets beyond the reach of the Internal Revenue Service. Although the Government concedes that evasion-of-payment cases will almost invariably involve some affirmative acts of fraud or deceit, it is still true that the elements of tax evasion pursuant to §7201 do not necessarily involve fraud or deceit. Thus, we conclude that the specific inclusion of tax evasion in Clause (ii) was intended to ensure that tax evasion pursuant to §7201 was a deportable offense. Clause (ii) does not implicitly remove all other tax offenses from the scope of Clause (i)’s plain language.3
The Kawashimas also assert that the separate treatment of tax crimes and crimes involving fraud and deceit in the United State Sentencing Guidelines supports their contention that Congress did not intend to include tax crimes within Clause (i). They point to the fact that, in 1987, the United States Sentencing Commission included within the Guidelines a category of “offenses involving fraud or deceit.” USSG §§2F1.1 to 2F1.2 (deleted effective Nov. 1, 2001). The Commission simultaneously included “offenses involving taxation” as a separate category. §§2T1.1 et seq. (Nov. 2011). Although the Kawashimas acknowledge that they have found no evidence that Congress actually considered the Guidelines, they contend that “it is likely that the language of [Clause (i)] and [Clause (ii)] was taken from the Sentencing Guidelines” by the sponsors of the bill that expanded the definition of aggravated felony to include subparagraph (M). Brief for Petitioners 29. Therefore, the theory goes, we can infer from the similar language in the Guidelines that Congress did not intend Clause (i) to include tax crimes.
We reject the Kawashimas’ reliance on the Guidelines. The Kawashimas’ argument is at odds with the fact that, unlike the Guideline that the Kawashimas cite, Clause (ii) does not refer to all offenses “involving taxation.” Rather, Clause (ii) is expressly limited to tax evasion offenses under §7201. That textual difference undercuts any inference that Congress was considering, much less incorporating, the distinction drawn by the Guidelines.C
Finally, the Kawashimas argue that subparagraph (M)’s treatment of tax crimes other than tax evasion is ambiguous, and that we should therefore construe the statute in their favor. It is true that we have, in the past, construed ambiguities in deportation statutes in the alien’s favor. See INS v. St. Cyr, 533 U. S. 289, 320 (2001) . We think the application of the present statute clear enough that resort to the rule of lenity is not warranted.* * *
For the foregoing reasons, we conclude that convictions under 26 U. S. C. §§7206(1) and (2) in which the revenue loss to the Government exceeds $10,000 qualify as aggravated felonies pursuant to 8 U. S. C. §1101(a)(43)(M)(i). Because the Kawashimas are subject to deportation as aliens who have been convicted of aggravated felonies pursuant to 8 U. S. C. §1227(a)(2)(A)(iii), the judgment of the Court of Appeals is affirmed.
It is so ordered.
1 On March 1, 2003, most of the functions of the Immigration and Naturalization Service were transferred to the Bureau of Immigration and Customs Enforcement, and the Immigration and Naturalization Service ceased to exist.
2 Before 1996, there were two procedures for removing aliens from the country: “deportation” of aliens who were already present, and “exclusion” of aliens seeking entry or reentry into the country. Since 1996, the Government has used a unified procedure, known as “removal,” for both exclusion and deportation. See 8 U. S. C. §§1229, 1229a. We use the terms “deportation” and “removal” interchangeably in this opinion.
3 We note that the issue whether the Kawashimas’ offenses satisfy the second requirement of Clause (i)—that the loss to the victim exceeded $10,000—is not before us. We address only whether their offenses of conviction qualify as crimes “involv[ing] fraud or deceit.”
SUPREME COURT OF THE UNITED STATES
AKIO KAWASHIMA, et ux., PETITIONERS v. ERIC H. HOLDER, Jr., ATTORNEY GENERAL
on writ of certiorari to the united states court of appeals for the ninth circuit
[February 21, 2012]
Justice Ginsburg, with whom Justice Breyer and Justice Kagan join, dissenting.
Petitioner Akio Kawashima was convicted of preparing a false corporate tax return in violation of 26 U. S. C. §7206(1). His wife, petitioner Fusako Kawashima, was convicted under §7206(2) of assisting her husband in preparing the false return. The question presented is whether a conviction under §7206 is an “aggravated felony” that renders the Kawashimas deportable from the United States. See 8 U. S. C. §1227(a)(2)(A)(iii).
Congress has defined “aggravated felony” to include, inter alia, offenses that “(i) involv[e] fraud or deceit in which the loss to the victim or victims exceeds $10,000” or “(ii) [are] described in section 7201 of title 26 (relating to tax evasion) in which the revenue loss to the Government exceeds $10,000.” §1101(a)(43)(M). The Kawashimas argue that tax offenses triggering deportation are delineated exclusively in §1101(a)(43)(M)(ii) (or Clause (ii)), and that §1101(a)(43)(M)(i) (or Clause (i)) does not encompass tax crimes. The Court rejects this argument, and holds that any tax offense “involv[ing] fraud or deceit,” if the loss to the fisc exceeds $10,000, ranks as an “aggravated fel-ony.” See ante, at 11. Because the Kawashimas’ tax offense involved deceit and meets the monetary threshold, the Court concludes, they have committed an aggravated felony and are therefore deportable.
The Court’s construction of the statute is dubious, as I see it. For one thing, it effectively renders Clause (ii) superfluous. Further, the Court’s reading sweeps a wide variety of federal, state, and local tax offenses—including misdemeanors—into the “aggravated felony” category. In addition, today’s decision may discourage aliens from pleading guilty to tax offenses less grave than tax evasion, thereby complicating and delaying enforcement of the internal revenue laws. I conclude that Clause (i) does not address tax offenses, and would therefore hold that making a false statement on a tax return in violation of §7206 is not an “aggravated felony.”I
Any alien convicted of an “aggravated felony” after admission to the United States is deportable. 8 U. S. C. §1227(a)(2)(A)(iii). Subparagraph (M) of §1101(a)(43) includes as an “aggravated felony”:
“an offense that—
“(i) involves fraud or deceit in which the loss to the victim or victims exceeds $10,000; or
“(ii) is described in section 7201 of title 26 (relating to tax evasion) in which the revenue loss to the Government exceeds $10,000.”
Notably, Clause (i) speaks of “loss to the victim,” Clause (ii) of “revenue loss to the Government.” The Kawashimas contend that Clause (i) covers crimes of fraud or deceit causing losses unrelated to tax revenue. Tax crimes, they argue, are addressed exclusively in Clause (ii), and that clause designates only tax evasion proscribed by 26 U. S. C. §7201 as an “aggravated felony.” Willfully submitting a false statement proscribed by §7206, the Kawashimas maintain, is not an “aggravated felony” that would render them deportable under 8 U. S. C. §1227(a)(2)(A)(iii).
The Government contends that Clause (i) covers all tax offenses involving fraud or deceit, and that Congress included Clause (ii) out of caution, to make certain that persons convicted of tax evasion would be subject to deportation. Under the Government’s construction, because the crime of making a false statement on a tax return involves “fraud” or “deceit,” the Kawashimas committed an aggravated felony. See ante, at 5 (“the words ‘fraud’ and ‘deceit’ are absent from the text of §7206(1) and are not themselves formal elements of the crime,” nonetheless, “[the] elements [of a §7206 crime] necessarily entail fraudulent or deceitful conduct”).
The Court’s task is to determine which reading of the statute is correct. If the two proffered constructions of subparagraph (M) are plausible in roughly equal measure, then our precedent directs us to construe the statute in the Kawashimas’ favor. See Fong Haw Tan v. Phelan, 333 U. S. 6, 10 (1948) (“We resolve the doubts in favor of [the alien] because deportation is a drastic measure . . . .”); INS v. St. Cyr, 533 U. S. 289, 320 (2001) (same).II A
In interpreting 8 U. S. C. §1101(a)(43)(M), I would rely upon the familiar canon that statutes should be interpreted to avoid superfluity. See Corley v. United States, 556 U. S. 303, 314 (2009) (quoting Hibbs v. Winn, 542 U. S. 88, 101 (2004) (“[O]ne of the most basic interpretive canons” is that a “statute should be construed so that effect is given to all its provisions, so that no part will be inoperative or superfluous, void or insignificant . . . .”)). If Clause (i) is construed to apply to tax crimes, then Clause (ii)’s discrete inclusion of tax evasion would add nothing, for tax evasion is itself an offense that, in all actual instances of which the Government is aware, “involves fraud or deceit.” See §1101(a)(43)(M)(i); Tr. of Oral Arg. 30–31.
The elements of tax evasion are the existence of a tax deficiency, willfulness, and “an affirmative act constituting an evasion or attempted evasion of the tax.” Sansone v. United States, 380 U. S. 343, 351 (1965) . As this Court’s decisions indicate, the evasion of taxes involves deceit or fraud upon the Government, achieved by concealing a tax liability or misleading the Government as to the extent of the liability. See, e.g., Spies v. United States, 317 U. S. 492, 499 (1943) (an act of tax evasion may be “any conduct, the likely effect of which would be to mislead or to conceal”). Accordingly, courts have determined that tax evasion is a crime of moral turpitude, because it necessarily involves fraud. See, e.g., Carty v. Ashcroft, 395 F. 3d 1081, 1085, n. 7 (CA9 2005) (fraud is “implicit in the nature of the crime” of tax evasion); Considine v. United States, 683 F. 2d 1285, 1287 (CA9 1982) (“The express language of section 7201 requires an intent to avoid tax (a legitimate synonym for fraud).”); Costello v. INS, 311 F. 2d 343, 348 (CA2 1962) (“There can be no ‘wilful’ [tax] evasion without a specific intent to defraud.”), rev’d on other grounds, 376 U. S. 120 (1964) .
Even more to the point, courts have held that a conviction for tax evasion under 26 U. S. C. §7201 “conclusively establishes fraud in a subsequent civil tax fraud proceeding.” Gray v. Commissioner, 708 F. 2d 243, 246 (CA6 1983); see Klein v. Commissioner, 880 F. 2d 260, 262 (CA10 1989) (conviction under 7201 “collaterally estops a taxpayer from denying fraud [in a] civil tax case involving the same years”). 1 This preclusive effect obtains, courts have explained, because “ ‘willful’ [tax evasion] includes all of the elements of fraud.” Tomlinson v. Lefkowitz, 334 F. 2d 262, 265 (CA5 1964); see Gray, 708 F. 2d, at 246 (“The elements of criminal tax evasion and civil tax fraud are identical.”); Moore v. United States, 360 F. 2d 353, 356 (CA4 1966) (“[W]hile the criminal evasion statute does not explicitly require a finding of fraud, the case-by-case process of construction of the civil [fraud] and criminal tax provisions has demonstrated that their constituent elements are identical.”).
Tax offenses span a wide range, from failure to file a tax return, 26 U. S. C. §7203, to the unauthorized use of tax stamps, §7209. But “the gravest of offenses against the revenues,” this Court has said, the “capstone” of tax law violations, is tax evasion. Spies, 317 U. S., at 497, 499; see Boulware v. United States, 552 U. S. 421, 424 (2008) . Tellingly, the Kawashimas pleaded guilty to a crime carrying a maximum prison term of three years, §7206; for tax evasion, the maximum term is five years, §7201. It is thus understandable that Congress would single out tax evasion, as it did in Clause (ii), specifically designating it, and no other tax crime, an “aggravated felony” for deportation purposes.
The Court ascribes a different purpose to Clause (ii). Tax evasion, made criminal by §7201, the Court states, “almost invariably,” but “not necessarily[,] involve[s] fraud or deceit.” Ante, at 10. But see supra, at 4 and this page. Congress likely included Clause (ii), the Court suggests, simply “to remove any doubt that tax evasion qualifies as an aggravated felony.” Ante, at 8. In other words, in holding that Clause (i) includes tax offenses, the Court finds Clause (ii) largely, but not totally, redundant.
In support of the notion that tax evasion can occur without fraud or deceit, the Court cites United States v. Scharton, 285 U. S. 518 (1932) ; see ante, at 9. In that long-obsolete case, the Court rejected the Government’s plea for the application of an extended limitation period to a prosecution for tax evasion. The generally applicable statute of limitations was three years; for tax offenses that involve defrauding the United States, however, the limitation period was six years. An averment of intent to defraud, the Court said in Scharton, would be “surplusage,” for it would suffice “to plead and prove a wilful attempt to evade or defeat.” 285 U. S., at 521.
Courts had limited Scharton to its statute of limitations context several decades before Congress enacted §1101(a)(43)(M) in 1994. See Tseung Chu v. Cornell, 247 F. 2d 929, 936, n. 6 (CA9 1957) (distinguishing Scharton and holding that tax evasion is a crime of moral turpitude because it entails fraud); Lefkowitz, 334 F. 2d, at 265 (distinguishing Scharton and holding that tax evasion necessarily involves fraud). Moreover, Congress, since 1954, has expressly prescribed a six-year limitation period for tax evasion. See 26 U. S. C. §6531(2). In short, Scharton is a cryptic, thinly reasoned opinion, one that did not influence subsequent federal-court description of the crime of tax evasion. The suggestion that Congress may have worried about Scharton when framing legislation over 60 years later is hardly credible.
The Court presents another reason, drawn from the Government’s brief, why Congress may have treated tax evasion discretely, while embracing tax crimes generally within the Clause (i) category. Section 7201 covers both evasion of assessment and evasion of payment. Imagine a taxpayer who files a truthful return, then moves her assets to a place “beyond the reach of the Internal Revenue Service.” Ante, at 10; see Brief for Respondent 34. The Court acknowledges that evasion-of-payment cases almost always “involve some affirmative acts of fraud or deceit.” Ante, at 10. Still, there may be a rare case in which that is not so. Rare, indeed; imaginary would be an apt characterization. The Government conceded that, to its knowledge, there have been no actual instances of indictments for tax evasion unaccompanied by any act of fraud or deceit. Tr. of Oral Arg. 30–31.
The canon that statutes should be interpreted to avoid superfluity cannot be skirted as easily as the Government here urges. We have declined to interpret legislation in a way that “would in practical effect render [a provision] entirely superfluous in all but the most unusual circumstances.” TRW Inc. v. Andrews, 534 U. S. 19, 29 (2001) . It is hardly sufficient for the Government to hypothesize a case in which the provision might have some independent role. See id., at 30. Where, as here, “the Government concede[s] that the independent function one could attribute to the [provision] would [rarely] arise,” a construction moored to a case “most unlikely” to exist should be rejected. Id., at 31. It is highly improbable that “a proviso accounting for more than half of [the] text” of §1101(a)(43)(M), i.e., Clause (ii), “would lie dormant in all but the most unlikely situations.” See 534 U. S., at 31.
Congress’ aim in drafting §1101(a)(43) was to determine which crimes are sufficiently serious to warrant the “drastic measure” of deportation, and which are not. See Fong Haw Tan, 333 U. S., at 10. It is implausible that Congress, when drafting §1101(a)(43)(M), intended to address, or was even aware of, the Government’s scenario: a taxpayer who files a truthful return, then, to thwart collection of the tax due, moves all her assets offshore. Far more likely, Congress did not intend to include tax offenses in §1101(a)(43)(M)(i), but instead drafted that provision to address fraudulent schemes against private victims, then added §1101(a)(43)(M)(ii) so that the “capstone” tax offense against the Government also qualified as an aggravated felony. See supra, at 5.B
The Court’s construction of the statute is even less plausible given the numerous offenses it would rank as “aggravated felon[ies].” Many federal tax offenses, like 26 U. S. C. §7206, involve false statements or misleading conduct. See, e.g., §7202 (failing to truthfully account for and pay taxes owed). Conviction of any of these offenses, if the Court’s construction were correct, would render an alien deportable. So would conviction of state and local tax offenses involving false statements. Ferreira v. Ashcroft, 390 F. 3d 1091, 1096–1097 (CA9 2004) (state-law offenses qualify as offenses involving fraud or deceit under 8 U. S. C. §1101(a)(43)(M)); see, e.g., Del. Code Ann., Tit. 30, §574 (2009) (submitting a tax return false as to any material matter is a criminal offense); D. C. Code §47–4106 (2001–2005) (same); Ala. Code §40–29–114 (2003) (same); Va. Code Ann. §58.1–1815 (2009) (willfully failing to account truthfully for and pay certain taxes is a criminal offense).
Rendering all tax offenses involving false statements “aggravated felon[ies]” that subject an alien to deportation is all the more problematic, for many of these offenses are misdemeanors. Among federal misdemeanors, see, e.g., 26 U. S. C. §7204 (“furnish[ing] a false” W-2 form to an employee); §7205 (“suppl[ying] false or fraudulent information” to an employer); §7207 (filing a return “known . . . to be false as to any material matter”). On the state and local level, see, e.g., Cal. Rev. & Tax. Code Ann. §1610.4 (West 1998) (“Every person who wilfully states anything which he knows to be false in any oral or written statement, not under oath, required or authorized to be made as the basis of an application to reduce any tax or assessment, is guilty of a misdemeanor.”); N. D. Cent. Code Ann. §57–37.116 (Lexis 2011) (“Every person who willfully and knowingly subscribes or makes any false statement of facts [on an estate tax return] . . . is guilty of a class A misdemeanor.”); Columbus, Ohio City Code §§361.31(a)(4), (b), (d) (2009) (any person who “knowingly make[s] and file[s] an incomplete, false or fraudulent [municipal] return” is guilty of a fourth-degree misdemeanor). Nor would the $10,000 threshold set in 8 U. S. C. §1101(a)(43)(M) prevent deportation for tax crimes far less serious than willful tax evasion, for as many as six years may be included in the amount-of-loss calculation. See 26 U. S. C. §6531 (setting a six-year statute of limitations for, inter alia, tax crimes involving fraud or falsity); Brief for Johnnie M. Walters as Amicus Curiae 15–16 (hereinafter Walters Brief). 2
Finally, the Court’s decision has adverse consequences for the efficient handling of tax prosecutions. It is often easier for the Government to obtain a conviction under §7206 (false statements) than under §7201 (tax evasion). See United States v. Olgin, 745 F. 2d 263, 272 (CA3 1984) (unlike a conviction under §7201, a conviction under §7206 does not require proof of a tax deficiency); Considine, 683 F. 2d, at 1287 (unlike a conviction under §7201, a conviction under §7206 does not require proof of an attempt to escape a tax). For this reason, the Government has allowed taxpayers to plead guilty to a §7206 charge in lieu of going to trial under §7201 on an evasion charge. See Walters Brief 19–20. Deportation consequences are important to aliens facing criminal charges. See Padilla v. Kentucky, 559 U. S. __, __ (2010) (slip op., at 10) (“[P]reserving the client’s right to remain in the United States may be more important to the client than any potential jail sentence.” (quoting St. Cyr, 533 U. S., at 322)). If a §7206 charge carries the same prospect of deportation as a §7201 charge, then an alien’s incentive to plead guilty to any tax offense is significantly reduced.* * *
For the reasons stated, I would hold that making a material, false statement on a tax return does not qualify as an aggravated felony within the compass of 8 U. S. C. §1101(a)(43)(M)(i). I would therefore reverse the judgment of the Court of Appeals for the Ninth Circuit.
1 See also, e.g., Blohm v. Commissioner, 994 F. 2d 1542, 1554 (CA11 1993); Fontneau v. United States, 654 F. 2d 8, 10 (CA1 1981) (per curiam); Plunkett v. Commissioner, 465 F. 2d 299, 307 (CA7 1972).
2 One might also ask what reason Congress would have for making a tax misdemeanor a deportable offense, while more serious crimes do not jeopardize an alien’s residency in the United States. See, e.g., Leocal v. Ashcroft, 543 U. S. 1 –12 (2004) (driving while drunk, causing serious bodily injury to others is not an aggravated felony).
ORAL ARGUMENT OF THOMAS J. WHALEN ON BEHALF OF THE PETITIONERS
Chief Justice John G. Roberts: We will hear argument next in Case 10-577, Kawashima v. Holder.
Mr. Whalen: Mr. Chief Justice, and may it please the Court:
Mr. and Mrs. Kawashima came here to the United States as legal immigrants in 1985.
And later on they pled guilty to filing a false statement under a corporate tax return.
The issue we bring to the Court is whether that conviction under 26 U.S.C. 7206 is an aggravated felony, specifically under (M)(i) of the aggravated felony statute.
This Court many times has held that it is the elements of the crime of conviction that determine whether a crime is an aggravated felony.
And the elements of 7206 do not change when they go over to the immigration statute.
And the terms of that statute is basically as the Department of Justice has written in its Tax Manual.
It is basically a tax perjury statute.
If you don't tell the truth, and you know what you are saying is false, and you do it under oath, that's perjury.
There are other statutes, perjury statutes, which in essence say the same thing.
And 18 U.S.C. 1001 is also a perjury statute.
And none of them require the Justice Department or a court to determine whether fraud and deceit was an element of that crime.
Justice Antonin Scalia: How would you prove fraud and deceit beyond proving that the person lied, intentionally lied?
What is added to intentionally lying to convert that into fraud or deceit?
Mr. Whalen: It's the intention to deceive or the intention to defraud.
Justice Antonin Scalia: Isn't intentionally lying -- doesn't that mean that you intend to deceive?
Mr. Whalen: --It does not, Your Honor.
Justice Antonin Scalia: It doesn't?
Mr. Whalen: It does not mean, because you are saying a false -- making a false statement, that that is evidence of an intent to deceive.
Justice Ruth Bader Ginsburg: Mr. Whalen, the common definition of deceit is acting -- intentionally giving a false impression, intentionally giving a false impression with the intent that someone will act on it.
So it seems that's exactly what filing a false return is.
You give a false impression of what your income is with the intent that the IRS will accept it.
Mr. Whalen: Justice Ginsburg, the difference I'm trying to ask the Court to consider, it is the intent which is an element of fraud and deceit.
Under section 7201, the tax evasion statute, that includes both a requirement or a finding of fraud and deceit.
Section 7206 does not.
Justice Ruth Bader Ginsburg: But why isn't it obvious?
What proof would you need?
You submit a document because you want to convey a false impression for someone to act on.
Why do you have to have anything more than that to establish deceit?
Mr. Whalen: Because the requirements, Your Honor, of 7206 is a finding of -- of simply making a false statement.
That's all that's required.
The IRS, when they go after a taxpayer because they have not provided -- they have not disclosed all of their income, the IRS comes in, or rather the Department of Justice, and all they have to prove is that it's false.
They don't have to prove--
Justice Anthony Kennedy: And that it's willful.
And That it's willful.
Mr. Whalen: --Pardon me, Your Honor?
Justice Anthony Kennedy: That it's willful.
"Whoever willfully makes a false statement. "
Mr. Whalen: Yes, Your Honor, but as this Court--
Justice Anthony Kennedy: So that is not correct.
Well, correct me if I am wrong.
It would seem to me just from reading the statute, unless we have some gloss on, that if you think it's true but it's false, from the way you were indicating, would be a violation.
That's not the way I read it.
Now, have we said something other than that in later cases?
Mr. Whalen: --If I may, Your Honor.
This Court has written in the Spies case, and specifically in the Bishop case, that in order to be convicted of any tax offense under the Internal Revenue Code, the IRS or the Department of Justice must show it was done willfully.
Willfully is not intrinsic to any -- it's really intrinsic to all of the tax offenses.
Willfully does not mean deceit or fraud.
It simply means that the IRS cannot bring a criminal information or indictment against somebody who does something unintentionally.
They must do it willfully.
Willfully, as this Court defined in Bishop, is simply evidence that -- to commit any of these IRS crimes you must -- it must be shown to have been done willfully.
Justice Antonin Scalia: You know that it's false when you say it.
Isn't that what willfully means?
You must know that the statement you are making is false.
Mr. Whalen: Willfully means intentionally.
The false, I submit--
Justice Antonin Scalia: I don't want another adverb.
I want you to describe what it means in the context of a statement.
Doesn't it mean that you have to know that the statement you are making is false.
Isn't that enough for willfulness?
Mr. Whalen: --Yes.
Justice Antonin Scalia: Okay.
Now, you tell me what deceit involves beyond that.
Mr. Whalen: Deceit involves an intention to induce somebody to act.
And what I'm arguing to this Court is that simply making a false statement under a tax perjury statute such as we have in this case does not meaning and does not evidence an intention to deceive or a finding.
Justice Sonia Sotomayor: I'm sorry, but I'm a little bit lost here.
Your definition of deceit is a false statement with an intent for the other party to rely.
And you don't see that when you file your tax returns that the government is relying on your statement to calculate your tax and to ensure that you've paid it?
You don't see any reliance by the government on the truthful statements there, and its collection of taxes?
Mr. Whalen: I -- I do say reliance is generally is what happens.
What I'm saying is that 7206 is a perjury statute and the government does not have to prove, and did not have to prove in this case anything more than the -- the -- the income was unreported or the tax -- the tax return was false.
Justice Sonia Sotomayor: So it also had to prove that the government relied?
Is that what you are saying?
Mr. Whalen: --I'm saying that the government -- if the government wanted to prove fraud or deceit, they -- that would be an element of the crime of tax evasion, 72--
Justice Sonia Sotomayor: I'm -- I'm not even sure why, because under tax evasion you can be charged with tax evasion merely for avoiding the payment of tax.
You don't have to make a statement at all.
You can take the money from the bank, withdraw it openly, and stick it in your mattress, refuse to pay, and if somehow they find your mattress you can be charged with tax evasion.
Where is the falsehood and deceit in that?
Mr. Whalen: --The government would have to prove fraud or deceit, because an intent to evade is -- the Court -- the -- the government has to prove--
Justice Sonia Sotomayor: If there's a -- if there are cases that say otherwise, what does that do to your argument?
Of which there are many that say that the avoidance of taxes, tax payment, doesn't require an act of fraud or deceit?
Mr. Whalen: --I would be surprised by those--
Justice Stephen G. Breyer: Well, suppose somebody goes -- he goes to a country where we have no extradition treaty, takes all his assets and writes a postcard to the IRS once a month saying ha-ha-ha.
I mean, why wouldn't that be an attempt to evade?
That's why he went; he didn't like to pay his taxes.
Mr. Whalen: --Then the government would bring an action under the--
Justice Stephen G. Breyer: Well, 7201.
Why can't you -- well, why doesn't that violate 7201?
I mean, my simple question really is you are a drafter, imagine you are a drafter, and you are charged with drafting section 43.
And you read -- try to get the fraud and deceit crimes, okay?
So now we read 76 -- 7206(1) and (2).
And you see for both of those you can't be convicted unless you materially and willfully make a false statement.
So you think, hey, I don't need a special section on that one.
But then you go to 7201, and you say, oh, my God, I just thought, somebody might violate this by going off to some special country, taking all his assets and writing ha-ha-ha.
Now there is no fraud or deceit in that.
He is totally open about it.
But he sure has evadded it.
So therefore I better write a special section.
Now, that's the simple-minded argument, but what's wrong with it?
Mr. Whalen: --What's wrong with it, Your Honor, is that what we're talking about is the aggravated felony statute.
And the issue -- and it may be a narrow one for this Court -- is whether the conviction under 7206, which does not require anything more than filing of a false statement without any intent to deceive or defraud -- whether that is an aggravated felony.
And this Court has said time and again that it's the elements of the offense that determines aggravated felony.
If I may illustrate the point, if -- if a conviction under 7206 was viewed by this Court as including fraud and deceit for the reasons many of the justices have indicated, that, you know, that when somebody writes a false tax return, it's got to be deceit, what that does is that would collaterally estop a taxpayer from denying fraud and deceit in the civil collection action.
So this is what Commissioner Walters was concerned about, why he has filed his brief, that it in effect would undermine the ability of the government to get an easy conviction based simply on a false statement.
Similarly, if you are convicted of tax evasion, the -- the tax evader cannot challenge fraud.
He is collaterally estopped.
And as we know, when the government goes to seek recovery, that is getting the taxes back in a civil proceeding, there is no statute of limitations.
The intention of Congress is also reflected in the Internal Revenue Code section 6501, where if a person is convicted under 7206 and the government seeks to collect the unpaid taxes in an assessment proceeding, Congress particularly said that where there is a conviction under 7206, the government has the burden of proving fraud, which seems to me to be evidence -- or rather, the government has the -- a duty to prove there was an attempt to evade the tax.
But the conclusion is the same.
If Congress had intended that proof of fraud and deceit would be in 7206, there would be no reason at all for congress to put that in 70 -- 6501.
Chief Justice John G. Roberts: I'm sorry.
That's 26 U.S.C. 6501?
Mr. Whalen: --Yes.
To be more precise, 6501(c)(1).
Chief Justice John G. Roberts: Okay.
Mr. Whalen: That is the exceptions to the running of the statute of limitations.
Justice Ruth Bader Ginsburg: Do we have it in the briefs?
Mr. Whalen: I have it in my reply brief.
I don't have the particular statute, but I refer to it in the reply brief.
Justice Antonin Scalia: Do you have the text of it?
I don't like counsel getting up here and talking about statutes that they've never put before us.
If you're going to rely on it, we -- we would like to have the text somewhere.
Mr. Whalen: Yes.
I apologize for that, Your Honor.
I would like to move to the second part of my argument, if Your Honor please, that the -- this Court has been very clear on deciding statutes invoking the canons of construction.
And one of the important canons is that different words have different meanings.
So in (M)(i), we have loss to victim or victims in excess of $10,000.
And in (M)(ii), we have a revenue loss to the government in excess of 10,000.
And as this Court said in Nijhawan, referring to (M)(ii), this is the Internal Revenue provision, a correct assessment, I suggest, and that (M)(i) deals with injuries or damage to third parties, not to the government.
If you take the government's position that fraud and deceit crimes are in -- fraud and deceit revenue crimes are in (M)(i), then (M)(ii) would be worthless or pointless.
Justice Antonin Scalia: Well, why?
Because it wouldn't be pointless if in fact an attempt to evade or defeat tax does not require a lie, does not require a willful lie.
It would be adding to the -- to the fraud and deceit offenses, 7201, which does not require a lie.
It just requires, you know, going to Cuba and writing postcards saying, I know I owe money, I just ain't gonna pay it.
There is no fraud and deceit there.
It's just what 7201 requires, an attempt to evade or defeat tax.
Mr. Whalen: Anyone who leaves the country with an intent to avoid tax is committing tax evasion.
Justice Antonin Scalia: That's right.
That's my very point.
Mr. Whalen: And that is--
Justice Antonin Scalia: Without lying -- without lying -- without making a single lie.
Mr. Whalen: --What I'm saying is that fraud, such as you suggest, Your Honor, is going to be an aggravated felony.
It's the only one that Congress says -- the only revenue offense.
The only offense under the Internal Revenue Code which Congress designated as an aggravated felony.
What I'm saying is that if tax evasion were also included in (M)(i), then Congress would have created a useless, pointless provision.
Justice Antonin Scalia: Yes.
And my point is that it would not have been included within (M)(i).
There is no way that it could be included with (M)(i), because it does not involve or deceit.
It does not involve a lie, as 7206 does.
Mr. Whalen: 7201 involves, I'm suggesting--
Justice Antonin Scalia: An attempt to evade or defeat:
"Who willfully attempts in any manner to evade or defeat any tax. "
And one can do that without lying.
One can do that by simply not report income, for example.
Or in -- in Justice Breyer's more colorful example, by going to Cuba.
Was it Cuba or somewhere else?
Mr. Whalen: --Well, the point I am trying to make, Your Honor, is that if your example is an example of fraud and deceit, which I agree it is, then a crime of fraud and deceit would not be in (M)(i) because it would BE -- it would already be captured in (M)(i) if the government's position was upheld.
Justice Ruth Bader Ginsburg: But the point that is being made is not that it's fraud and deceit.
Quite the opposite.
I think Justice Breyer, Justice Sotomayor, Justice Scalia have tried to get you to focus on the evasion that involves no false statement at all, evading payment where you say nothing.
What would be the crime if you simply don't pay your taxes, and you don't file returns, so you are not filing anything that is false?
Where would that come in the internal revenue?
Mr. Whalen: That would be a violation of one of the other internal revenue crimes.
Justice Stephen G. Breyer: Would it be evasion simply not to report your income?
Mr. Whalen: If the government chose to prove that it was an attempt to evade the tax, it would.
The internal revenue statute and crimes all carry the duty to -- it's a legal duty we all have of fairly reporting our income, our deductions, what have you.
It's the same legal duty whether it's in 7201 or 7206.
The difference is in tax evasion there must be proof of fraud or deceit.
From the beginning of this country -- rather, the beginning of the tax statutes, Congress has always separated revenue statutes from other crimes.
In this case (M)(i) deals with crimes involving third-parties, (M)(ii), deals with revenue loss crimes to the government.
Only (i) is an aggravated felony.
I would like to reserve the remainder of my time for rebuttal.
Chief Justice John G. Roberts: Thank you, counsel.
ORAL ARGUMENT OF CURTIS E. GANNON ON BEHALF OF THE RESPONDENT
Mr. Gannon: Mr. Chief Justice, and may it please the Court:
Congress's specific reference to tax evasion in subparagraph (M)(ii) of the INA's definition of aggravated felony did not remove all other tax offenses from the scope of subparagraph (M)(i).
Justice Elena Kagan: Mr. Gannon, do you think that you can commit tax evasion without committing either fraud or deceit, and are there cases that show that?
Mr. Gannon: The cases that we cited in our brief on page 34 that discuss this are ones that are evasion of payment cases as opposed to evasion of assessment cases.
And those -- those are instances in which somebody could accurately file a tax return and say I owe you this amount of money and then take steps to prevent the IRS from collecting on it, usually by removing their assets from the IRS's reach.
As a factual matter, it so happens that most of those cases will often involve some concealment along the way.
If somebody's taking more than $10,000 in gold coins out of the country to take them to a Swiss bank, they often don't mention that when they are leaving the country.
Justice Antonin Scalia: What about just not filing returns?
Mr. Gannon: Just not filing a return is probably not going to be enough to establish tax evasion.
That would be an offense under 7203, which doesn't necessarily involve fraud or deceit.
The thing that distinguishes 7201 is the need for the government to establish that there is an attempt to evade either the assessment or payment of taxation.
Justice Elena Kagan: I mean, I suppose what confuses me is when somebody is convicted of 7201, they can't -- they are estopped from contesting a civil fraud suit, isn't that right?
And it also counts as a crime of moral turpitude, which involves fraud.
And all of those things suggest, and I think kind of the cases as a whole suggest, that tax evasion involves fraud.
Mr. Gannon: Well, certainly in the context of the civil tax fraud penalty, the Tax Court has concluded that intent to evade is synonymous with an understatement due to fraud.
And the reason why it has refused to reach that conclusion in the context of 7206 offenses, like the ones at issue in this case, is because the 7206 offense does not require the government to prove that there was any understatement to begin with, And so there could not have been an understatement due to fraud.
I'd also note that it is not at all clear that in the context of the evasion of payment cases that I was just discussing in the context of tax evasion, that the same civil tax fraud penalty would be applicable there, because the civil tax fraud penalty is triggered by an understatement of an amount required to be shown on the return.
And therefore if it is -- if it isn't actually something that is done in the context of filing a tax return that understates how much you owe the government, then -- then that may well not trigger the collateral estoppel effect in the follow-on civil case.
Justice Elena Kagan: Counsel, what if you do--
Justice Sonia Sotomayor: Excuse me.
Are there any tax provisions that you think are not covered by the fraud and deceit section and the tax evasion section?
Mr. Gannon: You mean--
Justice Sonia Sotomayor: Any tax crime.
Mr. Gannon: --Any tax crime--
Justice Sonia Sotomayor: Felonies, I should say.
Mr. Gannon: --There are several tax offenses that don't necessarily involve fraud or deceit.
So parts of 7202, which is the willful failure to collect tax, would not necessarily involve fraud and deceit, but it also covers failing to truthfully account for collected tax.
So some of those offenses would involve fraud or deceit and it may be divisible.
7203, which I just mentioned--
Justice Sonia Sotomayor: Does that fall under tax evasion or that's a separate statute?
Mr. Gannon: --That's not tax evasion.
The only thing that counts as tax evasion is 7201.
Justice Sonia Sotomayor: I cut you off.
Which are the other ones?
Mr. Gannon: I was saying that I already mentioned to Justice Scalia that section 7203, all of these offenses I'm talking about, are in 26 U.S.C. 7203, the willful failure to file a return or to pay tax or maintain records or supply information doesn't necessarily involve fraud or deceit.
Parts of 7204, which is failing to furnish a statement to the employee reflecting the amount of taxes, but not -- but then again, I think it could be divisible because it would also apply to furnishing a false statement to your employee.
Even the misdemeanor offense under 7207 for presenting false documents might be covered for fraud or deceit, but in practice it's only used when there's -- it's only used when the tax deficiencies are de minimis.
And so it would never trigger the $10,000 loss requirement that (M)(i) would also require us to establish in order to make it an aggravated felony.
Chief Justice John G. Roberts: Counsel, what -- what is your answer to your friend's 6501(c)(i) argument?
Mr. Gannon: Well, my answer is that I don't think it proves really any more than the collateral estoppel cases in the civil fraud context the provision that we're talking about is not reprinted in any of the briefs, but 6501(c)(1) is an exception that -- that lifts the limitation on when the IRS can levy an assessment or seek collection; and it refers to the case of a false or fraudulent return with the intent to evade tax.
And I think that in context, the reference to a false or fraudulent return with intent to evade tax is not something that clearly connotes that Congress is just speaking to 7206 offenses.
It uses not only the word fraudulent, but also the intent to evade tax, which I think--
Chief Justice John G. Roberts: Well, no, but I think your friend's argument, which had some appeal, is 7206 is fraud and false statements.
And he said if you're right that that includes deceit, they wouldn't have had to add
"with the intent to evade tax. "
which is what they do in 6501(c)(1).
Mr. Gannon: --Well, I -- I think if you look to (c)(2) it also refers to a willful attempt in any manner to defeat or evade tax.
So the next provision also applies more broadly to 7201 and more closely tracks the definition in 7201.
So I think just like the statute of limitations provision that we note, Congress is probably using a belt and suspenders approach there.
That we noted that Congress may well have had reason to be concerned that 7201 offenses would not necessarily be seen as having fraud or deceit as an element of the offense, in light of this Court's decision in Scharton, which was an old case but it had said that in the -- in the statute of limitations context, that the -- the extended statute of limitations that apply to offenses in which fraud was an element, was not triggered by the statutory predecessor to tax evasion.
And so to the -- STOP--
Justice Elena Kagan: --But Scharton was a very old case which had been distinguished away by many courts.
This really has no power in the -- in the -- I mean, tell me if I am wrong, but--
Mr. Gannon: --Well, to this day section 6531, which is the statute of limitations provision which we do reprint in our appendix, includes provisions that refer not only generally to offenses involving fraud but also specifically to a tax evasion offense.
And so I think that the fact that Congress had already felt like it needed to be expressed, to pull in not just fraud offenses but also tax evasion offenses in 6531, makes it unsurprising that they would have pursued a similar approach here.
In addition I would--
Justice Elena Kagan: --I mean, the paradoxical thing about your argument is that one, it makes us think that Congress was just being hypervigilant about this problem of making sure that tax evasion offenses were covered, even though tax evasion offenses almost always do involve fraud or deceit, but Congress was thinking about these hypothetical possibilities that maybe there was going to be some conviction out there that would not involve fraud or deceit, and so Congress is being super-careful about this.
And yet at the same time that Congress is being utterly careless, utterly clueless about the basic rule of statutory construction which is that one does not write superfluous language.
Mr. Gannon: --But Justice Kagan, we don't think it's superfluous, in part because of the evasion of payment cases we are talking about, but I think also if you look at the context of the rest of paragraph 43, the aggravated felony definition, you'll see that there are several other provisions that have significant overlap in them.
And so subparagraph (A) refers to murder and rape; those would also generally be covered in crimes of violence in subparagraph (F).
The same thing is true in paragraph (E)(i); it pulls in various explosive offenses including arson, destruction of property or building by fire or explosives; that is the reference to an 8441--
Justice Elena Kagan: So our rule of statutory construction when it comes to this aggravated felony statute is that superfluity doesn't matter?
Mr. Gannon: --No, Justice Kagan, I think that offense.
in context, there is a lot of overlap among the different provisions in -- in paragraph 43 already, and I -- I was also going to mention subparagraph (K)(i) and (ii), which like (M)(i) and (M)(ii) are ones that have little (i), which has a generic reference there to offenses associated with managing a prostitution business, and little (ii) then expressly refers to certain enumerated Federal statutes, all of which involve transporting individuals for purposes of prostitution in the case of seeking commercial advantage.
And I think that virtually all of those offenses would have been included within (K)(i) but Congress wanted to be sure and therefore added (K)(ii); and as -- as Justice Breyer pointed out I think before, textually it -- it had reason to think that 7206 would be picked up by fraud or deceit here--
Justice Ruth Bader Ginsburg: But 7206 is the lesser offense.
I mean, you don't take -- you don't dispute that the heavier crime is the 7201 crime, that is, evasion.
It gets a more severe penalty.
And when Congress picks out one tax crime and one tax crime only, why wouldn't we assume that that's what Congress meant with respect to aggravated felonies?
That there is one tax crime, the most serious tax crime; that fits that label.
And the (M)(i) provision deals with the many, many statutes that involve loss -- fraud or deceit and loss to the victim?
Mr. Gannon: --The reason why we don't think that's appropriate is in part because as I have explained there -- there is some aspect of which (M)(ii) is not superfluous.
But more importantly, we don't think the specific controls that General Cannon has triggered here -- and we don't think that (M)(ii) talks about a category of tax crimes or tax offenses more generally, because it only refers to one offense.
And so the cases that Petitioners invoke here in order to establish that there is a category that is being pulled out of (M)(i) are HCSC-Laundry and Leocal.
Those are both cases in which the statute actually identified the category of offenses in question, whether it was the cooperative hospital service organizations in HCSC-Laundry or DUI offenses in Leocal.
And so here we don't have Congress actually saying tax offenses are covered by (M)(ii).
What it says is tax evasion is covered by (M)(ii).
Justice Stephen G. Breyer: What about -- what about -- Suppose we suppose that didn't even exist here, 7201.
only had 7206, and the question before us was does 7206 fit within the term aggravated felony, i.e., does it involve fraud or deceit?
So we read 7206; it doesn't say anything about fraud or deceit.
It says perjury and making a So then we go look up, what are the And he's right.
Fraud torts of fraud and deceit?
traditionally requires an intent to get another person to act, but you don't have to have that intent to violate 7206.
And deceit, it not only involves that, it So the also involves the person having acted.
traditional tort of deceit, you have to intend the act and he actually has to have acted to his detriment.
Fraud, you have the first of those and second.
You read the statute, say, well, say neither of those is present here.
This is just perjury, which isn't good, but it's And there we are, not in the not fraud or deceit.
What's the answer to that?
Mr. Gannon: --Well, I don't think that the common law definitions of fraud and deceit are the ones that this Court has always applied in the context--
Justice Stephen G. Breyer: No, no, not always.
But here we were dealing with a very serious statute, aggravated felonies, that has terrible consequences for the persons who fall within it.
Mr. Gannon: --So--
Justice Stephen G. Breyer: And in most of these M's and A's and B's and C's, and so forth, they refer to statutes by number, so most of it although not all of it is very specific.
So when we read these words fraud and deceit here, why don't we say fraud and deceit means fraud and deceit?
Mr. Gannon: --In the--
Justice Stephen G. Breyer: Traditional elements.
Mr. Gannon: --In the criminal context the Court has recognized that fraud offenses don't require the government to prove reliance or damages, and that makes sense.
If you think about the tort action, the classic tort action you would need to be an injured plaintiff, and therefore you would need to be able to say I relied on this to my detriment.
Justice Stephen G. Breyer: No, no, no.
You have to prove that the -- the liar intended reliance to -- to his detriment.
Mr. Gannon: And--
Justice Stephen G. Breyer: Which he may or may not I mean, when you commit -- a person commits perjury may or may not have intended that a victim rely to his detriment.
Which you don't have to prove here.
Mr. Gannon: --We do not have to prove as a separate element that there is reliance or intended reliance here, but we do need to prove what we think satisfies the plain meaning of the term deceit.
We are not focusing on fraud here but deceit, and that's the act of intentionally giving a false impression, because the elements of this offense are making and signing a return under the penalty of perjury that it is false in a material manner, that the defendant does not--
Justice Stephen G. Breyer: Deceit can mean that.
Mr. Gannon: --does not believe to be true or correct, and it's all done willfully.
Justice Stephen G. Breyer: No, the tort didn't involve The tort involved the same element of fraud which you don't want to rely on.
Mr. Gannon: That -- that's right, and we think here Congress has used the -- the term--
Justice Stephen G. Breyer: Is there any -- is there any evidence of what -- I mean is there any argument other than that you just think that and you could argue the other way?
I mean can we get anywhere?
Mr. Gannon: --Well, I think that Congress did use the terms disjunctively here, and I think that the -- now the plain meaning of deceit it sort of operates in the opposite direction of the one you are talking about, Justice Breyer.
And if you look at the way the Court in Yermian discuss the difference between an intent to defraud and intent to deceive, it talks about an intent to fraud includes actually obtaining something whereas intent to deceive just involves creating a false impression.
And so I think that actually the difference can run the other direction in a way that supports the definition that we are relying on here.
But going back to the point that I was trying to make about this not ruling out all tax offenses, Justice Ginsburg, I think that the reference to 7201 alone doesn't do, that nor do we think the fact that Congress then added a limited -- limiting language that said that when the revenue loss exceeds $10,000, it would satisfy (M)(ii).
Justice Elena Kagan: Could I make sure, Mr. Gannon, that I understand your argument about superfluidity?
Because when I asked whether (M), the second provision was superfluous, you pointed me to the evasion of payment cases.
And you cite two of them.
But then you say even those cases will almost invariably involve some affirmative acts of fraud.
So are there, in fact, any cases, evasion of payment or otherwise, which do not involve some affirmative acts of fraud?
Mr. Gannon: Well, I think that is a factual matter, Justice Kagan.
Justice Elena Kagan: A factual matter argument.
Mr. Gannon: --We were observing that as a factual matter, those evasion-of-payment cases probably would not happen without there being acts of concealment.
Justice Elena Kagan: And that's what I'm asking.
As a factual matter, can you point me to any cases that do not involve affirmative acts of fraud?
Mr. Gannon: I don't believe that I can, but I think that to the extent that the Court has looked into the elements of the offense in 7201, if they are talking about evasion of payment, that will not necessarily require deceptive acts of concealment.
so that's the reason--
Justice Elena Kagan: I know, but we have a very And active IRS which prosecutes lots of tax cases, and you are saying that it just never prosecutes tax cases under this section that don't involve affirmative acts of fraud.
Mr. Gannon: --Well--
Justice Elena Kagan: And that makes me wonder why Congress was so worried about this problem that it ignored normal rules of statutory interpretation.
Mr. Gannon: --Well -- And I believe that the reason that they were worried could be because of the Scharton decision which this Court had already said that evasion does not necessarily require fraud because the textual cues in 7201 are much further from fraud and deceit than those in 7206, that there's also -- there would be less certainty, even assuming that Congress was well aware of the established practice at the Federal level of having 7201 tax evasion cases be compared with fraud, this is also a provision that applies to State and foreign offenses.
The penultimate sentence of paragraph 43 says that the term applies to an offense whether it's in violation of Federal State law.
Justice Ruth Bader Ginsburg: Well, one of the problems that was brought up in the amicus brief which actually was considered, that reading the (M)(i) to include 7206 offenses would also -- would bring in offenses that are merely misdemeanors at the State and local level, it would really swell the category of tax crimes that lead to deportation.
That -- did Congress really mean to turn misdemeanors into aggravated felons?
And then there was a very practical point made that government is going to be hurt more than helped by what you are seeking, because we are told that very often the government will try to make a bargain.
It has a 7201 case, but it's going to be a little hard to prove.
So they offer as a plea bargain 7206.
And if you -- if your position prevails, we are told, there will be many, many people who will say: If it's a question of whether I get thrown out of the United States, I'm going to go to trial; I'm not going to plead to something that will mean immediately when I serve my time I will be thrown out of the United States.
Mr. Gannon: Well, that may well be the consequence of the definition that Congress has adopted here of aggravated felony.
And I would note in the plea agreement that Mr. Kawashima filed in this case, paragraph 4, which is reprinted on 117 A of the petition appendix says:
"Mr. Kawashima recognizes that he may be That's in his And so it is, deported as a result of his conviction. "
plea agreement to the 7206 offense here.
to be sure, the case that the government may well find it more difficult to secure guilty pleas when an alien is admitting to an offense that is an aggravated felony.
But we think that that's a consequence of Congress having expanded the definition.
Justice Stephen G. Breyer: Let me go up and start with I mean, if this Justice Ginsburg's first question.
falls within it, 7206, this fraud, what about perjury?
Is every perjury statute within it?
lying to a FBI agent?
And what about And what about lying to a government official which is -- You know, there are all kinds of statutes on that one.
Are all those aggravated felonies?
Mr. Gannon: --Congress has given us two different metrics of determining whether those, whether those offenses are aggravated felonies.
If they involve fraud or deceit and there is loss to the victim exceeding $10,000, then that it could fall within -- and when it is perjury statute that doesn't involve loss or false statements to an FBI agent that doesn't involve loss to--
Justice Stephen G. Breyer: The government's view is that of course you have to meet the other requirements.
But as far as the words fraud or deceit is concerned, aggravated felony picks up every perjury statute, every lying statute, lying to an FBI agent, lying to this or lying to that, and has that been the consistent policy of the immigration service?
Have they deported people where the other two conditions were fulfilled?
Mr. Gannon: --In the beginning when of the I think most perjury amount of loss was $200,000.
offenses do not involve the loss of $200,000--
Justice Stephen G. Breyer: But all I need are a few.
I mean, I just wonder, is it the policy of the INS and the government to deport people where these other things are met, which they may perhaps be rarely, I don't know.
But to deport them where the crime, the underlying crime cases.
is perjury, lying to an FBI agent or lying to other government officials.
Mr. Gannon: --There -- Yes, there are such Sometimes they go under (S), which is the paragraph for perjury, which was actually not in existence when (M)(i) was added to the statute.
added two years later.
It was But more generally, I would like to mention that there are other tax offenses -- Justice Scalia.
Justice Antonin Scalia: Well, I'm confused by the $10,000 requirement.
Does that have to be an element of the offense?
Mr. Gannon: It does not need to be an element of the offense.
The consequence of the court's decision in--
Justice Antonin Scalia: Just the consequence of the fraud or deceit, right?
Mr. Gannon: --It needs to be tied to the offensive conviction, under this Court's decision in Ninja.
In most instances where somebody lies to an FBI agent, probably don't involve costing somebody more than $10,000.
And so I think that it doesn't often come up in (M)(i).
But many other tax offenses are prosecuted under other provisions that potentially involve fraud or deceit and could cost the government more than $10,000.
And Petitioner's reading of saying that all tax offenses have to be pulled into (M)(ii) and only tax evasion is covered would require the Court to bifurcate all of these other provisions.
instance, 18 U.S.C. 371.
And I'm thinking of, for This is the provision for defrauding the United States by obstructing or impeding the IRS in its efforts to collect taxation.
This Court cited 371 as one of the fraud offenses that it thought was covered by (M)(i) in the Nijhawan decision.
same is true for mail fraud.
The The criminal division, the tax division can prosecute tax cases in which somebody mails a false tax return under 18 U.S.C. 1341.
False claims under 18 U.S.C. 287; conspiracy to false claims under 286; false statements to the government, these are all provisions that are used to prosecute tax offenses.
And Petitioner's reading of saying that all tax crimes are culled out would require the Court to bifurcate these offenses and make whether it's an aggravated felony turn on whether the government has lost revenue as opposed to some other form of money.
And we don't think that that's what Congress intended when it went to the trouble of just stating that tax evasion was expressly covered.
And going back, Justice Kagan, to your concerns about superfluidity, I do think it's important that in the context of this statute, there's lots of other overlap.
Congress had reasons to be unsure.
In light of the Scharton decision, in light of the evasion-of-payment cases because even though as a factual matter--
Justice Elena Kagan: But It would have been perfectly easy for Congress to write a provision which said just in case that -- you know, just in case this decision called Scharton has any effect, we mean tax evasion, too, without writing it in this way that appears to exclude all other tax offenses.
Mr. Gannon: --I don't see how -- if Congress wanted to exclude all other tax offenses, I think they should have put that exception in (M)(i).
have said: They should Offenses involving fraud or deceit, but not tax offenses, in which the loss to the victim or victims exceeds $10,000.
If Congress wanted to make an exception tax offenses--
Justice Elena Kagan: Well, that's just arguing against our application of the normal rule of avoiding superfluidity where we can.
Mr. Gannon: --Well, yes.
I agree that the Court avoids superfluidity where it can.
contextual reasons to think that Congress was just trying to add more offenses to the definition rather than rule out an entire class.
And I also think that there is no way to avoid the consequence of bifurcating all of those other provisions under Petitioner's reading.
And so if you were to say that the reference to 7201 pulls out all revenue loss offenses, that would mean that some mail fraud cases against the government in which the government loses more than $10,000 count and some don't.
Same for wire fraud.
Same for false Same for false claims, conspiracy to false claims, and client conspiracies under section 371 which, which are -- have a great deal of overlap.
Justice Antonin Scalia: They still wouldn't -- no.
They still wouldn't be tax offenses.
Mr. Gannon: Well, I -- they would be--
Justice Antonin Scalia: You use the mail to avoid -- Still, what you are being prosecuted for is use of the mail to defraud.
Mr. Gannon: --But the -- I mean, as I understand Petitioner's argument, it is the fact that (M)(ii) refers to revenue loss that is the thing that makes it pull in or define a category of cases involving tax offenses.
And I think that if a mail fraud offense against the government involved taking -- getting more than $10,000 worth of refunds from the government as opposed to getting more than $10,000 in an ill-gotten government contract or government benefits from the government, that that could still be characterized as revenue loss.
Justice Antonin Scalia: But he put it wrong.
He should have said -- just tax statutes are covered.
Then -- then you wouldn't have to bifurcate, would you?
Mr. Gannon: Then -- I just don't see how the reference to a single provision of 7201 refers to all other tax provisions--
Justice Antonin Scalia: Well, it's not just that.
It's -- it's also that -- that (M)(i) says loss to the victim or victims.
And (M)(ii) says the revenue loss to I mean, in one One -- the government has to exceed $10,000.
case, it's the loss to the victim or victims.
why did that use parallel language?
Why -- or why did it say an -- an offense that involves -- an offense in which the loss to the victim or victims exceeds $10,000 and one involves fraud or deceit; or two, is described in section 7201 of Title 26?
I mean, if -- if you read it, it seems to contrast loss to the victim or victims with revenue loss to the government.
And I find it hard to regard the government as a victim in any of these cases, to tell you the truth.
Mr. Gannon: --None of the courts of appeals has had any difficulty concluding that the government is a victim when it loses more than $10,000 in a fraud case, or indeed in a tax evasion case.
So here, there is a different phrase, but I think what's important is that 7201 doesn't define a class of revenue loss offenses.
Instead, it defines a class of tax evasion It only refers to the one statute.
And -- and then in that context, where there has to be a deficiency in order to -- for there to be a 7201 conviction, there must be a tax deficiency.
Then it is natural to talk about the relevant losses being revenue loss to the government.
The phrase in (M)(i) is broader because it also applies to other types of frauds.
And I think that the reference to 7201 alone doesn't indicate Congress is intending to weed out all tax offenses.
As Justice Ginsburg mentioned before, although 7201 has a 5-year maximum statutory penalty, which is longer than the 3-year maximum that applies under 7206 and some of the other tax offenses in that particular chapter of Title 26, as a practical matter, the -- the sentencing guidelines use the same thing.
The -- the same criteria that are both tied to loss.
And more importantly, a lot of these other offenses, like 371 and 1341 and 1343 in Title 18 actually have longer maximum punishments.
So if the government wants -- has a particularly big fraud that they want to -- to get after somebody who has a tax evasion case in which they've cost the government a great deal of money -- it may choose to proceed under one of the other provisions where it can get an even greater punishment.
And so just referring to 7201 as the capstone I don't think allows it to be a stand-in for all other tax offenses.
Justice Ruth Bader Ginsburg: There is a technical aspect of this case I don't understand, and maybe you can explain it.
There was a question about what might Why be the revenue loss in -- in the case of the wife.
should the revenue loss be different?
convicted of aiding and abetting.
Mr. Gannon: She -- although it -- the statute itself refers to aiding, assisting, procuring or advising, it's not a traditional aiding and abetting statute.
It doesn't require there to be an underlying primary violation.
It's an independent offense.
And so as it happens in this case, we all know and it is not disputed that therefore, the same underlying false tax return, the same tax return that ended in 1991 for one of the corporations that Petitioners co-owned, but -- but we just didn't have that evidence in the record.
And so, I -- I think even though it's an aiding and abetting, it's not a classic aiding and abetting violation that depends on the -- the husband's conviction.
She could have been convicted under 7206, too, even if the husband didn't know anything about the false numbers that she was providing him from the restaurant that they were operating.
So if there are no further questions, we would urge the Court to affirm the court of appeals.
Chief Justice John G. Roberts: Thank you, counsel.
Mr. Whalen, you have eight minutes remaining.
REBUTTAL ARGUMENT OF THOMAS J. WHALEN ON BEHALF OF THE PETITIONERS
Mr. Whalen: My colleague mentioned the Yermian case, which is in our brief, but I failed to present it to the Court today.
And it's a very important case decided by this Court which said that filing a false statement is not -- is not indicative, not evidence of an intent to deceive.
Similarly, the Harry Bridges case, also decided by this Court, said that -- and the Court held that making a false statement about Mr. Bridges' involvement with the Communist Party is not evidence of fraud.
These cases, I believe of this Court, control the issue that deceit or fraud is not an essential element for this crime of conviction.
Following up what Justice Kagan has said, has asked, that the rules -- canons of construction that the Petitioner has invoked, the rules of superfluities -- again superfluities -- the idea that a court must give cognizance to different words meaning different things -- that is, revenue loss from the government is different from revenue loss to victim or victims, and the specific versus the general.
The answer of the government is simply speculation and conjecture of, among other things, courts make the wrong decisions, Congress didn't understand that tax evasion does involve fraud, and therefore, it will be superfluous.
The position of the government in this case is simply that tax evasion may not be in 72 -- or may not be in (M)(ii), the reason, rather, that fraud and deceit may not be in tax evasion, but that a lesser revenue offense is in (M)(i).
We -- I would like to remind the Court as many of the justices have indicated, we're not looking at an idea of someone who suffers a penalty because -- as a result of the tax offense.
We are talking about And And we are talking about deportation.
the statute which were involved should be read in favor, where Congress has not been clear, the statute should be read in favor of the immigrant.
Justice Ruth Bader Ginsburg: Although it's not a criminal statute.
Mr. Whalen: Pardon me, Your Honor?
Justice Ruth Bader Ginsburg: It's not a criminal statute.
Mr. Whalen: This Court in the Fong case said that the rule of lenity applies to an immigration case.
And the holdings of this Court have been consistent that the rule of lenity applies to both criminal cases as well as immigration cases.
And I invite the Court to look at the cases we have cited that the rule of lenity has applied, in fact, to immigration cases.
Justice Ruth Bader Ginsburg: There -- there's one technical feature, too, that I also didn't understand.
The particular tax here in question, the failure to report was 76-some thousand dollars, but the number that was given for the total failure to report is over $1 million, and the -- the loss to the IRS at -- is $245,000.
So the $245,000 loss must refer to more than the failure to report $76,000.
Mr. Whalen: The threshold amount is not an issue in the case.
Justice Ruth Bader Ginsburg: I would just like to know how we got -- how the $245,000 revenue loss was calculated, given that the crime that was charged, the failure was to report only $76,000?
Mr. Whalen: I don't know.
It was in negotiations between the government and the Kawashimas.
In any compromise the government chose only to charge them with a crime under 7206 which -- and to settle on that basis.
As Justice Alito has mentioned in the Padilla case quite emphatically, that attorneys representing immigrants deal with the government in order to avoid deportation.
And that -- in this case whether the Kawashimas had in fact filed false returns in an attempt to deceive, that was by the boards, because the government and the taxpayer agreed that their offense would be solely 7206, which as you read the elements, and you can read the Justice Department handbook which tells you what the elements are, and it does not include fraud and deceit.
If there are no further questions I -- finally I would like to mention one case which hasn't been brought up, which evolved from the questions by the justices, and that is a Third Circuit case which we cited, Nugent -- mentioned in response to Justice Breyer's question, that the Nugent case said that you must fulfill both elements, that is the perjury, S under the statute, and if it's included in fraud and deceit, you must fulfill the elements of both crimes at issue.
And of course in this case, the Kawashimas did not -- were imprisoned for 4 months and did not meet the statutory requirement for an aggravated felony of 1 year.
But in any event I want -- I would like the Court to keep in mind that what we are dealing here with is perjury, and we are not dealing with fraud or deceit, as agreed to by the government and the taxpayer.
And that, I suggest to the Court, should be dispositive in the decision in this case.
Chief Justice John G. Roberts: Thank you, counsel.
The case is submitted.
Chief Justice John G. Roberts: Justice Thomas has our opinion this morning in Case 10-577, Kawashima versus Holder.
Justice Clarence Thomas: This case comes to us on a writ of certiorari to the United States Court of Appeals for the Ninth Circuit.
Mr. and Mrs. Kawashima, who are citizens of Japan and who are at lawful permanent residence in this country, were both convicted of federal tax crimes.
Mr. Kawashima was convicted of knowingly and willfully submitting a materially false tax return and Mrs. Kawashima was convicted of willfully aiding or assisting in the preparation of the materially false tax return.
An Immigration Judge ordered the Kawashimas removed from the United States on the ground that their convictions qualified as aggravated felonies.
Specifically, the Immigration Judge determined that the convictions involved fraud or deceit that caused a loss to the Government of at least $10,000.
The Board of Immigration Appeals affirmed the Immigration Judge's decision.
The Ninth Circuit agreed that the Kawashima's conviction involved fraud or deceit, but it remanded for the Board to determine whether Mrs. Kawashima's conviction had, in fact, caused a loss to the Government in excess of $10,000.
In an opinion filed with the Clerk today, we affirm.
The Immigration and Nationality Act grants the Attorney General the authority to remove any alien who is convicted of an aggravated felony at anytime after admission to this country.
The Act defines an aggravated felony as among other things, an offense that involves fraud or deceit.
To determine whether an offense involves fraud or deceit, we look to the statute defining the crime of conviction rather than to the specific facts underlying the crime.
Mr. Kawashima was convicted of violating a statute that states that anyone who "willfully makes and subscribes any return which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter," shall be guilty of a felony.
Although, neither "fraud" nor "deceit" is a formal element of that crime, Mr. Kawashima's conviction necessarily involved deceit because it entailed knowingly and willfully submitting a tax return that was materially false.
Similarly, Mrs. Kawashima was convicted of violating a statute that declares that any person who "willfully aids or assists in the preparation or presentation of a return which is fraudulent or as false as to any material matter" has committed a felony.
Mrs. Kawashima's conviction also necessarily involved deceit because it entailed knowingly and willfully assisting the filing of a materially false return.
By its plain language, the Immigration and Nationality Act incorporates a broad class of offenses that involved fraud or deceit within the definition of an aggravated felony.
We reject that Kawashima's argument that Congress limited the scope of that broad language by stating in a second provision that tax evasion is also an aggravated felony when the tax loss to the Government exceeds $10,000.
The Kawashimas assert that by expressly making tax evasion an aggravated felony, Congress implicitly removed all other tax offenses, including the Kawashimas' offenses, from the category of crimes involving fraud and deceit.
We think it more likely that Congress sought to remove any doubt that's the serous offense of tax evasion was an aggravated felony.
Moreover, nothing in the provision for tax evasion alters the otherwise plain meaning of crimes involving fraud or deceit.
Because the Kawashimas are subject to deportation as aliens who have been convicted of aggravated felonies, the judgment of the Court of Appeals is affirmed.
Justice Ginsburg has filed a dissenting opinion, in which Justices Breyer and Kagan join.