FILED
                            NOT FOR PUBLICATION
                                                                             FEB 6 2020
                    UNITED STATES COURT OF APPEALS                       MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS


                            FOR THE NINTH CIRCUIT


UNITED STATES OF AMERICA,                        No.    18-10313

              Plaintiff-Appellee,                D.C. No.
                                                 1:14-cr-00114-DAD-BAM-1
 v.

MICHAEL GALLOWAY,                                MEMORANDUM*

              Defendant-Appellant.


                    Appeal from the United States District Court
                       for the Eastern District of California
                     Dale A. Drozd, District Judge, Presiding

                      Argued and Submitted October 24, 2019
                            San Francisco, California

Before: MELLOY,** BYBEE, and N.R. SMITH, Circuit Judges.

      Defendant Michael Galloway appeals his convictions and sentence for four

counts of tax evasion in violation of 26 U.S.C. § 7201. He argues that the district

court erred in: (1) denying his motion to dismiss Counts 1–3 of the indictment on


      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
            The Honorable Michael J. Melloy, United States Circuit Judge for the
U.S. Court of Appeals for the Eighth Circuit, sitting by designation.
statute-of-limitations grounds; (2) denying his motion for acquittal on Counts 1–3;

(3) denying his motion to suppress his financial records; and (4) applying a

sophisticated-means sentencing enhancement. We have jurisdiction under

28 U.S.C. § 1291, and we reverse in part, affirm in part, and remand for

resentencing.

1.    Galloway argues that the district court erred in not dismissing Counts 1–3 on

statute-of-limitations grounds because the indictment was brought more than six

years after Galloway filed his 2003, 2004, and 2005 tax returns. We review the

district court’s decision de novo. United States v. Sure Chief, 

, 922

(9th Cir. 2006).

      The six-year statute of limitations for tax evasion, 26 U.S.C. § 6531(2),

begins to run in evasion of assessment cases “from the occurrence of the last act

necessary to complete the offense.”1 United States v. Carlson, 

, 470

(9th Cir. 2000).2 Because tax evasion “is not a continuing offense” for statute of


      1
        Both parties agree that Counts 1–3 charge Galloway with committing tax
evasion only by evading the assessment of taxes, and not by evading the payment
of taxes.
      2
         The Government’s contention that Counts 1–3 are timely because the
statute of limitations began to run, not from the filing of the false tax returns, but
from the date Galloway lied to the IRS agents about his taxable income—i.e., the
last act of evasion—is squarely foreclosed by Carlson’s clear language. 

.
                                            2
limitations purposes, Cohen v. United States, 

, 770 (9th Cir. 1962)

(quoting Norwitt v. United States, 

, 133 (9th Cir. 1952)), the offense

of tax evasion “is complete as soon as every element in the crime occurs,” see

United States v. Musacchio, 

, 790 (9th Cir. 1991). The elements of tax

evasion under § 7201 are: (a) “willfulness”;3 (b) “the existence of a tax

deficiency”; and (c) “an affirmative act constituting an evasion or attempted

evasion of the tax.” United States v. Kayser, 

, 1073 (9th Cir. 2007).

      When Galloway late-filed his 2003, 2004, and 2005 tax returns, he had

already incurred a tax deficiency for each year. See United States v. Voorhies, 

, 714 (9th Cir. 1981) (“A tax deficiency exists [by operation of law] from

the date a return is due to be filed . . . .”). Therefore, each offense of tax evasion

charged in Counts 1–3 was complete when Galloway willfully filed his false tax

returns (i.e., each element of tax evasion was thereby satisfied). Because the

indictment was brought more than six years after Galloway filed his 2003, 2004,

and 2005 tax returns, Counts 1–3 are barred by the statute of limitations. We

therefore reverse the district court’s denial of Galloway’s motion to dismiss and

vacate his convictions as to Counts 1–3.




      3
          The parties do not dispute that Galloway willfully filed his false tax returns.
                                             3
2.    Because we reverse the district court’s denial of Galloway’s motion to

dismiss Counts 1–3 on statute-of-limitations grounds, we need not address

Galloway’s claim that the district court erred in denying his motion for acquittal.

3.    Galloway next argues that the district court erred in denying his motion to

suppress because the IRS’s warrantless inspection of his financial records violated

his private-property interests under the Fourth Amendment. But Galloway “never

requested suppression on this ground in the district court,” see United States v.

Guerrero, 

, 896–97 (9th Cir. 2019), petition for cert. filed, (U.S. Nov.

27, 2019) (No. 19-6825), and therefore Federal Rule of Criminal Procedure

12(c)(3) provides that we may only consider his untimely claim if he shows “good

cause for failing to present in his pre-trial motion the new theory for suppression

he raises in this appeal,” 

Because Galloway failed to show good cause,

we affirm the district court’s denial of his motion to suppress.

4.    Galloway lastly argues that the district court erred in applying a two-level

sentencing enhancement for “an offense involv[ing] sophisticated means.” See U.S.

Sentencing Guidelines Manual § 2T1.1(b)(2) (U.S. Sentencing Comm’n 2018). We

review the district court’s “application of the Guidelines to the facts for an abuse of

discretion, and its factual findings for clear error.” United States v. Jennings, 

, 1146 (9th Cir. 2013).


                                           4
      The district court made several factual findings upon which it based its

application of the sophisticated-means enhancement, none of which Galloway has

shown to be clearly erroneous. And because Galloway has failed to show that the

district court’s determination that his tax-evasion scheme was sufficiently

sophisticated to justify application of the sophisticated-means enhancement “was

(1) illogical, (2) implausible, or (3) without support in inferences that may be

drawn from the facts in the record,” United States v. Torlai, 

, 937 (9th

Cir. 2013) (quoting United States v. Hinkson, 

, 1262 (9th Cir. 2009)

(en banc)), we affirm the district court’s application of the Sentencing Guidelines.

      We REVERSE and VACATE Galloway’s convictions for Counts 1–3,

AFFIRM his conviction on the remaining count, and REMAND for resentencing.




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