                              UNPUBLISHED

                    UNITED STATES COURT OF APPEALS
                        FOR THE FOURTH CIRCUIT


                              No. 09-4924


UNITED STATES OF AMERICA,

                  Plaintiff - Appellee,

           v.

CELINA V. LORD,

                  Defendant - Appellant.



Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. James C. Cacheris, Senior
District Judge. (1:09-cr-00159-JCC-2)


Argued:   October 27, 2010                  Decided:   December 13, 2010


Before MOTZ and KEENAN, Circuit Judges, and HAMILTON, Senior
Circuit Judge.


Affirmed in part, vacated in part, and remanded by unpublished
opinion.   Judge Keenan wrote the opinion, in which Judge Motz
and Senior Judge Hamilton joined.


ARGUED: Mark John Petrovich, PETROVICH & WALSH, PLC, Fairfax,
Virginia, for Appellant.   Mark Sterling Determan, UNITED STATES
DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee.        ON
BRIEF: John A. DiCicco, Acting Assistant Attorney General, Alan
Hechtkopf, Karen Quesnel, UNITED STATES DEPARTMENT OF JUSTICE,
Washington, D.C.; Neil H. MacBride, United States Attorney,
Alexandria, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.




                                2
KEENAN, Circuit Judge:

       Celina Lord appeals her convictions by a jury on six counts

of    willfully    failing   to    make        payroll       tax   payments     for    her

employer, ASSC, Inc. (ASSC), in violation of 26 U.S.C. § 7202.

The   district    court    sentenced      Lord     to    a    total   of   21    months’

imprisonment followed by three years of supervised release.                            As

a condition of her supervised release, the district court also

ordered Lord to pay $776,849.47 in restitution to the United

States government.        See 18 U.S.C. §§ 3583(d), 3563(b).

       Lord   contends     that     the    district          court    erred:     1)    in

purportedly permitting an Internal Revenue Service (IRS) revenue

officer to testify about Lord’s state of mind; 2) in providing

the    jury   a   particular      definition       of    negligence;       and    3)   in

denying Lord’s motion under Rule 29 for a judgment of acquittal,

in which Lord asserted that the evidence was insufficient to

support the convictions.            For the reasons discussed below, we

affirm Lord’s convictions and sentences, finding error only in

the amount of restitution ordered by the district court.



                                          I.

       The record before us shows that certain types of employers,

including ASSC, are required to withhold employment taxes from

their employees’ wages.            See Erwin v. United States, 591 F.3d

313, 319 (4th Cir. 2010).                 The employer holds the money in

                                           3
“trust for the United States” until making a federal tax payment

in the amount of the withheld funds.                   26 U.S.C. § 7501(a); see

26 U.S.C. §§ 3102, 3402.           Because employment taxes are held in

trust, they commonly are referred to as “trust fund taxes.”                       See

Plett v. United States, 185 F.3d 216, 218 (4th Cir. 1999).

     If the IRS is unable to collect “trust fund taxes” from an

employer, as occurred in this case, the IRS may impose liability

on the employer’s officers or employees when two requirements

are met.     First, the officer or employee must have had a duty to

“collect, account for, and pay over” employment taxes for the

employer.     See 26 U.S.C. §§ 7202, 6672(a).                   An individual who

exercises     this    authority    is       referred      to   as    a    “responsible

person.”     See Slodov v. United States, 436 U.S. 238, 246 n.7

(1978); Plett, 185 F.3d at 218-19.                    Second, this responsible

person must willfully have failed to perform these tax-related

duties.     See 26 U.S.C. §§ 7202, 6672(a).               If both conditions are

satisfied, the employee may be personally liable to pay civil

penalties     under    26   U.S.C.      §       6672(a)   (trust      fund   recovery

penalties),    or     may   face   criminal        sanctions        and   imprisonment

under 26 U.S.C. § 7202.

     In the present case, ASSC failed to pay over employment

taxes to the federal government from the fourth quarter of 2001

through the second quarter of 2004.                  Celina Lord was the chief



                                            4
financial officer and the acting president of ASSC during the

period that ASSC failed to comply with federal tax laws.



                                          II.

     The evidence at trial showed that Jannette Green, a revenue

officer for the IRS, was assigned responsibility for collecting

delinquent     employment      taxes     owed       by       ASSC.        As   part    of    her

duties, Green conducted interviews with Lord and Linda Smith,

the president of ASSC, to determine whether they were personally

liable   for   trust    fund      recovery      penalties            under     26    U.S.C.    §

6672(a),     based     on   their      role     in       ASSC’s          failure      to    make

employment tax payments. 1

     Green     first    testified        regarding            her    conversations          with

Smith.     Green     stated    that      she    explained           to    Smith      the   IRS’s

procedures for determining civil liability to pay trust fund

recovery penalties.         Green informed Smith “that [as part of its

collection     efforts,     the    IRS    makes]         a    determination          based    on

willfulness    and     responsibility          to   determine            who   was    actually

responsible for having turned over [withheld employment taxes]

to the government and failed to do so.”


     1
       Linda Smith had taken a long-term leave of absence from
the company during the first half of 2001, and at some time
thereafter had appointed Lord to serve as acting president
during Smith’s absence.



                                           5
        Lord’s    counsel      raised     an       objection,      asserting      that    any

statements by Green regarding which individuals at ASSC were

responsible       for   payment    of     employment            taxes   would    improperly

invade the province of the jury to decide an element of the

offense     charged.           Counsel         for    the        government      responded,

suggesting that the district court instruct the jury that Green

was only testifying about her discussions with Smith regarding

her liability for civil penalties, and not about conclusions

Green    may     have   drawn     about    Lord’s          responsibility        under    the

criminal    statute.           Lord’s    counsel          accepted      the    government’s

proposal, stating, “All right.”

        After a brief recess, the district court instructed the

jury,    “You    had    some    testimony          from   Ms.     Green   on    responsible

party under her theory.            The question of who is the responsible

party is a question of law, and it’s not for Ms. Green to make

that     decision.”         Lord’s      counsel           did    not    object    to     this

instruction.

        Counsel for the government resumed his direct examination

of Green.        In response to a question, Green testified, “I would

have told [Smith] that based on the interview I conducted . . .

that I had deemed that [Smith] was both willful and responsible

for . . . having withheld money from employees’ paychecks for

taxes and Social Security and not having paid it over to the

government.”

                                               6
       Green      gave     similar       testimony      regarding      her   conversations

with Lord, except that Green did not use the word “willful.”

Lord       objected       to   the      government’s         questions    eliciting      this

testimony as leading, and to Green’s testimony as irrelevant.

The    district           court      overruled         Lord’s    objections.            Green

testified, “I told [Lord] how we determined who was responsible.

And I told her that based on the interview, that I would be

holding       her     responsible              for    the     trust      fund    [recovery]

penalties.”



                                                 A.

       We ordinarily review a district court’s evidentiary rulings

for abuse of discretion.                 See United States v. Johnson, 617 F.3d

286, 292 (4th Cir. 2010).                 However, when an evidentiary issue is

raised      for     the    first        time    on    appeal,    our     consideration     is

limited to a plain error review.                        United States v. Lynn, 592

F.3d 572, 577 (4th Cir. 2010); see Fed. R. Crim. P. 52(b).

Under the plain error standard, to constitute reversible error,

the    district       court’s        error      must    be    “plain”     and    must    have

affected a party’s “substantial rights.”                        Lynn, 592 F.3d at 577.

       Lord    maintains          for    the    first    time    on    appeal   that    Green

testified as an expert witness based on her specialized training

as    an    IRS   revenue         officer,       including      her    knowledge    of    the

relevant provisions of the Internal Revenue Code.                               Lord argues

                                                 7
that    Green     improperly       rendered      opinion    testimony      regarding

Lord’s mental state in violation of Federal Rule of Evidence

704(b), which prohibits an expert witness from “stat[ing] an

opinion or inference as to whether the defendant did or did not

have the mental state or condition constituting an element of

the crime charged.”          Fed. R. Evid. 704(b).              Lord further notes

that under Rule 704(b), this inquiry is a “matter[] for the

trier of fact alone.”         Id.

       In addressing this argument, we initially observe that the

government      did   not    attempt      to    qualify    Green    as    an    expert

witness,    and    that     Lord    did   not     raise    an   objection       in   the

district     court     challenging         Green’s        statements       as    being

inadmissible expert testimony.                  Thus, we review the district

court’s admission of Green’s testimony under the plain error

standard.    See Lynn, 592 F.3d at 577.

       The jury was charged, pursuant to 26 U.S.C. § 7202, with

determining whether Lord was “required” to “collect, truthfully

account for, and pay over” employment taxes, and whether she

willfully    failed    to     do    so.        This   inquiry    did     not    require

specialized knowledge or involve particular terms of art.                            See

Fed. R. Evid. 702.           The words used in § 7202 carry the same

meaning under the statute that they do in everyday use.                          Thus,

Green’s testimony describing her conversations with Lord about

Lord’s responsibility to pay over the employment taxes and her

                                           8
liability to pay civil penalties did not constitute “expert”

testimony.

     Even if we assume, without deciding, that Green effectively

rendered expert testimony, that testimony did not violate Rule

704(b).       Green    did    not    opine       about    Lord’s      state     of     mind

regarding    a   subjective      intent         to   violate   26     U.S.C.    §    7202.

Although     Green    testified      that       she    told    Lord    she     would    be

responsible      to   pay    civil   penalties,        Green    did    not     make     any

statements regarding Lord’s willfulness under § 7202 in failing

to pay over the employment taxes.                      Additionally, while Green

testified     that     Smith     acted          willfully,      Green’s        statement

regarding Smith was not probative of Lord’s culpability under §

7202, and thus did not have a prejudicial effect on the jury’s

consideration of the issue whether Lord acted willfully. 2

     We also note that after the close of all the evidence, the

district court carefully instructed the jury by defining the

terms contained in 26 U.S.C. § 7202.                  The district court further

stated, “If you find the defendant was not a responsible person,

     2
       For this same reason, we disagree with Lord’s alternative
argument that if Green testified as a lay witness, her testimony
regarding willfulness violated Federal Rule of Evidence 701(a),
which limits a lay witness’ testimony to opinions “rationally
based on the perception of the witness.” Fed. R. Evid. 701(a).
As stated above, Green did not testify that Lord acted
willfully, and Green’s testimony regarding Smith’s conduct was
not probative of, or prejudicial to, the jury’s consideration of
the issue of Lord’s willfulness.



                                            9
then you will not consider any other issue.                    On the other hand,

if you conclude the defendant was a responsible person, you must

decide whether the defendant acted ‘willfully’ in the failure to

collect,      truthfully    account      for    and   pay    over      taxes    to   the

Government.”      These instructions, together with the unchallenged

limiting instruction given to the jury during Green’s testimony,

plainly    informed     the     jurors   that      they,    not    Green,      had   the

ultimate    authority      to   decide      whether   Lord     was     a   responsible

party who      willfully      failed   to    pay   over     the   employment     taxes

under the terms of § 7202.                  We therefore conclude that the

district court did not plainly err in allowing the portions of

Green’s testimony at issue here.



                                         B.

      We   turn    to   consider       Lord’s      challenge      to    the    district

court’s supplemental jury instruction defining negligence.                            In

its initial charging instructions, the district court defined

the term “willful,” stating, “[t]o act willfully means to act

voluntarily and deliberately and intending to violate a known

legal duty.”      The court then explained that “[n]egligent conduct

is not sufficient to constitute willfulness.”

      During its deliberations, the jury asked the district court

to   define    “negligent       conduct.”       The   district         court   informed



                                         10
counsel    that    the     court    would     respond         that    “negligence         is    a

failure to exercise ordinary, reasonable care.”

     Lord     objected      to      this     definition,         asserting         that       the

district    court     either        should        decline      to    define        “negligent

conduct,” or should include in its definition the phrase “[care

that a] reasonable person would exercise.”                           The district court

proceeded    to    instruct        the     jury    in    accord       with       the   court’s

initial proposal.

     We review the district court’s decision to give this jury

instruction    for       abuse     of    discretion.           See    United       States      v.

Abbas, 74 F.3d 506, 513 (4th Cir. 1996).                             Thus, we will not

reverse     Lord’s        convictions         on        this        basis        unless       the

instructions,      taken     together,        did       not    adequately         state       the

controlling legal principles.                     United States v. Jeffers, 570

F.3d 557, 566 (4th Cir. 2009).

     The parties agree that the determination of willfulness,

for purposes of § 7202, requires a subjective assessment of a

defendant’s conduct.             Lord does not challenge the definition of

“willful” given       by    the     district       court,      but    suggests         that    in

defining negligence for the jury, the district court improperly

implied     that     willfulness,          like      negligence,            is    determined

objectively from the viewpoint of a reasonable person.

     We find no merit in Lord’s argument.                            At the outset, we

note that Lord expressly invited the district court to include

                                             11
in its definition of “negligent conduct” language regarding a

“reasonable person.”             See United States v. Herrera, 23 F.3d 74,

76   (4th     Cir.     1994).         Moreover,       the    district       court      correctly

defined     both       “willful”       and    “negligent”           conduct.          As     stated

above,      the        district        court     also         expressly          distinguished

negligence        from    willfulness,          and     instructed          the       jury     that

negligent acts cannot form the basis for a violation of § 7202.

Thus,    we    hold      that       the     district    court        did    not       abuse     its

discretion in giving the jury the supplemental instruction at

issue.

                                               C.

        We next address Lord’s argument that the district court

erred in denying her motion under Rule 29 for a judgment of

acquittal,        in     which        she      argued        that     the        evidence       was

insufficient to support her convictions.                           We review the district

court’s ruling de novo.                   United States v. Reid, 523 F.3d 310,

317 (4th Cir. 2008).

        When a Rule 29 motion is based on a claim of insufficient

evidence,      the      jury     verdict       must     be    sustained          if    there     is

“substantial evidence” to support the verdict, taking the view

most     favorable       to     the       government.         Id.          The    evidence       is

considered “substantial” if a reasonable finder of fact could

accept      the      proof     as     sufficient        to     support       a     defendant’s

conviction beyond a reasonable doubt.                        Id.     To obtain a reversal

                                               12
of   a        conviction        on    the     ground     that        the    evidence     was

insufficient, the prosecution’s failure of proof must be clear.

United States v. Moye, 454 F.3d 390, 394 (4th Cir. 2006) (en

banc).

        Lord contends first that the government failed to prove

that she “had a duty to collect, truthfully account for, and pay

over” employment taxes on behalf of ASSC.                             We disagree with

Lord’s argument.

        The     evidentiary          record       contains      substantial        evidence

showing that Lord was a “responsible person” required to pay

over employment taxes on behalf of ASSC.                         Lord conceded during

her testimony that she exercised authority over the finances of

ASSC.         She    not   only      was    authorized    to     sign      employment    tax

returns, but also had the ability to transfer the sums withheld

for taxes to the accounting service used by ASSC.

     Other          ASSC   employees       testified     that    Lord      controlled    the

day-to-day operations and finances of ASSC throughout the time

periods       at    issue.        Smith     testified    that     Lord      had   signature

authority over the bank account used by ASSC to pay all bills,

including payroll taxes.                   Smith further stated that Lord had

permission          to   file    ASSC’s     tax    returns     and    to    pay   over   the

employment taxes.               Taken together, this evidence was sufficient

to permit the jury to find beyond a reasonable doubt that Lord



                                              13
was responsible for withholding and paying over employment taxes

on behalf of ASSC.

     Lord argues, nevertheless, that the government failed to

prove that her failure to perform this duty was willful.                   This

argument, however, is refuted directly by the record.                The jury

heard evidence that Lord was aware of the importance of filing

tax returns.   Prior to accepting the position of chief financial

officer for ASSC, Lord had been an accountant for almost twenty

years.   In at least two of her previous jobs, Lord was involved

with, or was in charge of, ensuring that her employer’s payroll

taxes were properly filed and paid.             Further, Lord conceded in

her trial testimony that one of her “higher priorities” at ASSC

was to “file and to pay all outstanding taxes.”

     Lord repeatedly testified that she was too busy with other

responsibilities,    and   had   to        satisfy   other   debts   and   pay

employee wages, before she made ASSC’s employment tax payments.

Such acts, of paying wages and of satisfying debts to creditors

in lieu of remitting employment taxes to the IRS, constitute

circumstantial evidence of a voluntary and deliberate violation

of § 7202.     See United States v. Gilbert, 266 F.3d 1180, 1185

(9th Cir. 2001).     Lord’s willfulness also can be inferred from

her pattern of failing to pay over the taxes for an extended

period of time.     See United States v. Ostendorff, 371 F.2d 729,



                                      14
731 (4th Cir. 1967); United States v. Greenlee, 517 F.2d 899,

903 (3d Cir. 1975).

      Based on this evidence, and viewing the government’s proof

as a whole, we conclude that substantial evidence in the record

supports the jury’s conclusion that Lord willfully violated §

7702.    Thus, we hold that the district court properly denied

Lord’s Rule 29 motion for judgment of acquittal, and we affirm

Lord’s convictions.



                                        III.

      We conclude, however, that there was error in the amount of

restitution    ordered     by     the   district    court.      Restitution     is

allowed only “for the loss[es] caused by the specific conduct

that is the basis of the offense of conviction.”                       Hughey v.

United   States,    495    U.S.    411,    413   (1990).     Conduct    that   is

relevant to the government’s proof but does not form a basis for

the conviction may not be considered in ordering restitution.

United States v. Newsome, 322 F.3d 328, 341 (4th Cir. 2003).

      The parties agree that the proper amount of restitution

attributable   to    the    conduct       underlying   Lord’s   conviction     is

$330,430.79, rather than the amount of $776,849.47 ordered by

the district court.        The government concedes that this error was

not   harmless.      We    therefore       affirm   Lord’s   convictions       and

sentences, with the sole exception of the restitution ordered in

                                          15
this case.   We vacate the restitution provision in the district

court’s final judgment order, and we remand the case to the

district   court   for   the   limited   purpose   of   entry   of   final

judgment reflecting the corrected amount of restitution.



                                                        AFFIRMED IN PART,
                                                         VACATED IN PART,
                                                             AND REMANDED




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