from the United States District Court for the Western
District of Texas
HIGGINBOTHAM, PRADO, and HIGGINSON, Circuit Judges.
C. PRADO, CIRCUIT JUDGE.
P. Sertich, Jr. was charged and convicted by a jury with ten
counts of violating 26 U.S.C. § 7202 for willfully
failing to account for and pay over to the Internal Revenue
Service ("IRS") the federal income taxes he
withheld from his employees between 2008 and 2010. He was
also charged and convicted of one count of violating 26
U.S.C. § 7201 for willfully attempting to evade and
defeat payment of payroll taxes, penalties, and interest due
and owing to the United States. On appeal, Sertich argues
that the district court issued an incorrect jury instruction
as to the elements of an offense under § 7202 and that
the trial evidence was insufficient to support his
convictions pursuant to §§ 7201 and 7202. For the
reasons given below, we AFFIRM.
was a medical doctor and plastic surgeon who owned two
medical entities: South Texas Otorhinolaryngology
("STO") and Advanced Artistic Facial Plastic
Surgery of Texas ("Advanced Artistic"). These
entities employed staff to whom Sertich paid wages and from
whom he withheld payroll taxes. Between 2002 and 2011, the
total balance due for Sertich's entities was
$2,927,366.45, which Sertich accounted for in the
entities' tax filings, yet failed to pay over to the IRS.
2014, a grand jury charged Sertich in a superseding
indictment for criminal violations of two federal tax laws.
Sertich was charged with ten counts of violating § 7202
by willfully failing to account for and pay over taxes
withheld from his employees in each quarter between the
fourth quarter of 2008 and 2010. He was also charged with one
count of violating § 7201 by willfully attempting to
evade and defeat the payment of more than $2.9 million in
taxes owed by him and his medical entities. The case went to
a five-day jury trial. The facts are lengthy and complex, but
we detail the relevant evidence below.
trial, the jury heard evidence that Sertich had submitted
wage and tax statements to the IRS showing that money had
been withheld from his employees at STO, and that he had
claimed credit against his personal tax liabilities for the
withheld amounts. The jury also heard evidence that he
repeatedly failed to pay over those withheld funds. In 2004,
partially because Sertich was behind on STO's tax
liabilities, STO went out of business, and Sertich moved
himself and his staff to Advanced Artistic. In October 2004,
Sertich filed for Chapter 11 bankruptcy-the fourth time since
1992. Because he filed under Chapter 11, the government's
collection efforts ceased until Sertich again failed to make
IRS officers testified. One officer noted, for example, that
the IRS attempted to contact Sertich in 2005 at his personal
residence and mailed him a letter to encourage him to file
quarterly tax returns for STO. Sertich made no reply. Another
officer testified that beginning in November 2006, the IRS
attempted to visit Sertich at his business address. The
officer testified they repeatedly sent letters to try and
work with Sertich to deposit amounts withheld from the
paychecks of Advanced Artistic's employees and requested
financial records from Sertich, yet Sertich failed to comply
with those requests even as late as mid-2007. In late 2007,
the IRS issued a levy to Sertich's bank.
January 2008, Sertich filed bankruptcy for a fifth time, on
behalf of Advanced Artistic, once again halting collection
efforts. Sertich and his attorney met with the IRS for an
interview and produced information about his assets and
liabilities. Sertich agreed to make payments while his
bankruptcy was pending, but failed to make those payments.
His bankruptcy case was dismissed in 2009.
officers once again took steps to collect. The IRS
representative testified that the IRS made multiple attempts
in 2009 and 2010 to contact Sertich and collect on his tax
delinquency. A revenue officer informed Sertich that if he
did not satisfy his tax delinquency by selling or mortgaging
his residence, forced collection would begin. The IRS
eventually issued levies on Sertich's bank accounts and
insurance reimbursements and money was diverted to the IRS to
satisfy his tax delinquencies. In the fall of 2010, a revenue
officer served Sertich with a summons seeking financial
records and testimony. In December 2010, Sertich filed for
bankruptcy, once again halting collection efforts. This 2010
bankruptcy filing was dismissed in August of 2011.
the relevant time period, Sertich's accountants and
others told him "on a regular basis" that he owed
taxes, that he needed to file and pay his taxes timely, that
"it's going to become an issue," and that the
"IRS . . . will not understand the circumstances."
Sertich ultimately racked up a tax delinquency of over $2.9
trial, Sertich took the stand in his own defense. He told the
jury that he always intended to pay his taxes. He stated that
his failure to do so was related to personal and family
issues, and because he lacked the financial ability to
comply. Sertich admitted he pursued bankruptcy filings to
develop a payment plan, stressing that he always intended to
make good on his debts. He also explained that because his
accountant told him he would have to pay interest on his tax
delinquency, he "assumed" the delinquency "was
a loan" from the federal government.
jury found Sertich guilty on all counts. The district court
sentenced Sertich to 41 months of imprisonment followed by
three years of supervised released. Sertich filed and renewed
a motion for a judgment of acquittal after the
Government's case-in-chief and the jury's verdict.
Sertich also filed a motion for a new trial following ...