Speedy Trial? Helio Spits on Your Right to a Speedy Trial
Helio Castroneves doesn’t particularly care for the sixth amendment. Well, at least the part that gives him a right for a speedy trial. Today, Helio’s attorney, Mark Seiden, requested to delay the trial from March 2009 till November. That would, conveniently, be after the 2009 season.
That is no coincidence, however, as one of the chief reasons given is that the March date unfairly puts Penske Racing into a state of limbo. Similarly, they argue that any trial before the end of the season puts Helio’s contract at risk, even if he is acquitted.
In other trial news, there is a chance that Seiden will be disqualified because he may be a witness. The problem there is that he’s the one that has been around the longest. Seiden argues that his disqualification puts Helio as a significant disadvantage, since another attorney would have to be retained. His backup is David Garvin, who has been retained for his tax knowledge. Garvin, though, has a busy schedule ahead should Seiden be disqualified. That could also be cause for a delay.
In looking at the affidavit supporting the delay from Penske Racing, I give you this quote:
[I]f the trial proceeds as scheduled on March 2, Penske Racing will be forced, in all likelihood, to change drivers now to avoid the risk that Mr. Castroneves will be unavailable for the entirety of the 2009 Series.
In other words, if this delay is denied, you can potentially anticipate the availability of the #3 open in short order.
Update: The AP has a story up. Judging timestamps, I just scooped the Associated Press.
November 14th, 2008 at 4:20 am
It should be noted that Mr. Castroneves’ court case is a federal criminal court case and not a civil court case.
The reader can learn more about the differences between federal criminal court cases and federal civil court cases from the Federal Judicial Center of the United States government as it describes the basic differences on its webpage at http://www.fjc.gov/federal/courts.nsf/autoframe!openform&nav=menu1&page=/federal/courts.nsf/page/154.
Here are the basic differences from that webpage.
“Federal Criminal Case – A person accused of a crime is generally charged in a formal accusation called an indictment (for felonies or serious crimes) or information (for misdemeanors). The government, on behalf of the people of the United States, prosecutes the case through the United States Attorney’s Office if the person is charged with a federal crime.”
“Federal Civil Case – A civil case begins when a person or entity (such as a corporation or the government), called the plaintiff, claims that another person or entity, called the defendant, has failed to carry out a legal duty owed to the plaintiff. Both the plaintiff and the defendant are also referred to as parties or litigants. The plaintiff may ask the court to tell the defendant to fulfill the duty, or make compensation for the harm done, or both. Legal duties include respecting rights established under the Constitution or under federal law.”
A person is innocent until proven guilty.
A federal grand jury, based upon evidence presented to it by the United States government, returned an indictment against Mr. Castroneves.
The indictment brought by the United States government against Mr. Castroneves has very serious federal criminal charges.
If Mr. Castroneves is found guilty, the above-cited webpage cites “When a court determines that an individual committed a crime, that person will receive a sentence. The sentence may be a monetary penalty (a fine and/or restitution to the victim), imprisonment, or supervision in the community (by a court employee called a U.S. probation officer if a federal crime), or some combination of these three things.”
The United States government attorney issued the following news release describing the federal criminal indictment against Mr. Castroneves.
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http://www.usdoj.gov/usao/fls/PressReleases/081002-01.html
The United States Attorney’s Office
Southern District of Florida
RACE CAR DRIVER, SISTER AND LAWYER INDICTED ON TAX EVASION SCHEME
October 02, 2008
R. Alexander Acosta, United States Attorney for the Southern District of Florida, Nathan J. Hochman, Assistant Attorney General of the Justice Department’s Tax Division, Doug Shulman, Commissioner, Internal Revenue Service, and Michael E. Yasofsky, Jr., Special Agent in Charge, Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced that defendant Helio Castroneves, 33, a U.S. resident and two time winner of the Indianapolis 500, was indicted by a grand jury today on charges of conspiracy to defraud the United States of income taxes and with six separate counts of income tax evasion for tax years 1999, 2000, 2001, 2002, 2003, and 2004. Also charged in the Indictment were Helio Castroneves’s sister and business manager, Katiucia Castroneves, 35, of Miami, and his attorney, Alan R. Miller, 71, of Michigan.
U.S. Attorney Alex Acosta stated, “Whether one makes a living parking cars or racing them, paying taxes is a responsibility that everyone shares. Our tax laws apply equally to everyone, regardless of status, class, and income, and the U.S. Attorney’s Office will prosecute these cases vigorously.”
“Taxpayers, small and large, famous and not famous, should be aware of the enormously severe consequences they face if they fraudulently use offshore accounts to hide income, including potentially going to prison, paying back all their taxes plus interest and penalties, and being branded a felon for the rest of their lives,” said Nathan J. Hochman, Assistant Attorney General of the Justice Department’s Tax Division.
“Using offshore corporations for the purpose of evading taxes is a crime. This case sends a clear message that the IRS is committed to vigorously enforcing the lax laws and stopping offshore tax evasion,” said IRS Commissioner Doug Shulman.
“It is a legal requirement for individuals to accurately report all income and pay their tax liabilities,” said Michael Yasofsky, Special Agent in Charge, IRS-CI, Miami Field Office. “IRS will investigate and hold accountable those who conspire to intentionally evade their responsibility in complying with the tax laws.”
Count 1: The Coimex and Penske Income Tax Evasion Conspiracy
Count 1 of the Indictment charges defendants Helio Castroneves, Katiucia Castroneves, and Alan Miller with conspiring to defraud the United States, in violation of Title 18, United States Code, Section 371, by using an offshore Panamanian shell corporation, Seven Promotions Corporation (“Seven Promotions”), to fraudulently conceal from the Internal Revenue Service income received from two sources, Coimex Internacional SA (“Coimex”) and Penske Racing, Inc. (“Penske”).
More specifically, Count 1 alleges that Helio Castroneves entered into sponsorship contracts with Coimex, a Brazilian import and export company, for 1999, 2000, and 2001. Each year’s contract required Coimex to pay Helio Castroneves $2,000,000. Pursuant to an unwritten side agreement, however, Helio Castroneves returned $1,800,000 each year to certain Coimex executives, keeping $200,000 for himself. Of the $600,000 Castroneves retained from the Coimex contracts, he reported only $50,000 on his federal income tax returns.
As to the Penske income, the indictment alleges that Helio Castroneves joined Penske as a race car driver in November 1999. Defendant Alan Miller negotiated the deal with Penske and drafted the resulting contracts. Under the terms of the contracts, Helio Castroneves’ $6,000,000 three-year (2000, 2001, and 2002) compensation package would be split between a “Driver Agreement” ($1,000,000) and a “Licensing Agreement” ($5,000,000). Pursuant to the Licensing Agreement, the Panamanian shell corporation Seven Promotions was to receive $5,000,000, in exchange for the licensing rights to Castroneves’ name, likeness and image. The Indictment specifically alleges that Helio Castroneves, Katiucia Castroneves, and Alan Miller engaged in a scheme to avoid paying taxes on the $5,000,000 in Licensing Agreement income by creating a “deferred royalty plan” that required Penske to send the $5,000,000 payment to an offshore company, named Fintage Licensing B.V. (“Fintage”), in the Netherlands, instead of to Seven Promotions.
The defendants engaged in this deferred royalty plan despite the advice of outside tax counsel that Helio Castroneves would not qualify for the deferred royalty plan and would owe income tax on all payments under the Licensing Agreement if Castroneves or any member of his family owned or controlled Seven Promotions. Accordingly, Miller and Helio Castroneves falsely represented to tax counsel that neither Helio Castroneves nor anyone in his family had any interest in, or control of, Seven Promotions. Based on these misrepresentations, the deferred royalty plan was executed between Penske and Fintage; Penske paid Fintage the $5,000,000 originally due to Seven Promotions under the Licensing Agreement, and no income tax was ever paid by Helio Castroneves on the $5,000,000 in Licensing Agreement payments.
Counts 2 – 7: Tax Evasion (1999, 2000, 2001, 2002, 2003, and 2004)
The Indictment also charges defendants Helio Castroneves and Katiucia Castroneves with six substantive counts of tax evasion based on the false federal income tax returns filed by Helio Castroneves for years 1999 through 2004, in violation of Title 26, United States Code, Section 7201, and Title 18, United States Code, Section 2. Defendant Alan Miller is charged with three substantive counts of tax evasion, in violation of Title 26, United States Code, Section 7201, based on the false federal income tax returns filed by Helio Castroneves for years 2000, 2001, and 2002, in violation of Title 26, United States Code, Section 7201, and Title 18, United States Code, Section 2.
If convicted, the defendants face a maximum penalty of five years’ imprisonment on the conspiracy to defraud the United States, and five years’ imprisonment on each of the tax evasion counts.
Mr. Acosta commended the investigative efforts of the Internal Revenue Service. Acosta also noted the assistance and cooperation in this investigation of the Brazilian Federal Police, the Dutch Federal Police, and the Brazilian Federal Public Minister’s Office in Sao Paulo. The case is being prosecuted by Assistant United States Attorneys Matthew Axelrod and Jared Dwyer.
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One should recognize the age-old legal doctrine “ignorance of the law is no excuse” and “still has vitality and validity today. [See, for example, the court cases of Ratzlaf v. U.S., 510 U.S. 135, 149 (1994); U.S. v. Freed, 401 U.S. 601, 612 (1971) (Brennan, J., concurring); Minnesota v. King, 257 N.W.2d 693, 697 (1977)].”
“If a defendant were allowed to escape legal responsibility for his acts, merely by saying ‘I didn’t know it was wrong/illegal’, the system of using law to regulate human conduct would collapse. So the doctrine is a practical necessity.”
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http://www.miamiherald.com/sports/breaking-news/story/770298.html
Castroneves asks judge to postpone March trial
By KELLI KENNEDY
Associated Press Writer
MIAMI — Race car driver Helio Castroneves’ attorneys and employer asked a judge to delay his March trial on tax evasion charges until next November so he can continue racing, according to court documents filed Thursday.
Penske Racing, Inc. said if the trial is held between March and October, it will have to change drivers now to avoid the risk that Castroneves will be unavailable for the 2009 IndyCar series, which runs from April to October.
Penske attorneys said Castroneves is under contract with them for 2009 and must be available exclusively for all races.
Castroneves’ lawyer said it would be “catastrophic” for him to lose his job and that “a presumed innocent defendant should not face the prospect of losing his career based solely on the return of an indictment,” according to court documents. Additionally, one of Castroneves’ attorneys had a scheduling conflict in an unrelated case.
The U.S. Attorney’s office said it would respond to the motion in court.
Castroneves, a two-time Indianapolis 500 winner who also won the 2007 TV “Dancing with the Stars” competition, is charged with conspiracy and tax evasion. He’s accused of dodging U.S. taxes on about $5.5 million in income using offshore accounts. He has pleaded not guilty and is free on $10 million bail.
His sister and business manager, Katiucia, and attorney, Alan R. Miller, were also indicted. Both have pleaded not guilty.
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November 14th, 2008 at 7:29 am
Helio has a 6th Amendment right to a speedy trial; he could force the government to go to trial “fast” – like Alaska Senator Ted Stevens did. The government does not have a right to a speedy trial.
The judge sets the trail date and Helio may ask for a continuance. It is up to the federal court to grant it.
November 14th, 2008 at 9:52 am
Hi Jay,
The court record shows that Helio’s attorney has requested to submit a waiver for a speedy trial.
When the criminal charges were first brought in early October 2008 against Helio, he stated that he felt the trial would not occur until after the 2009 racing season had been completed and has also related that he has known for several years that the charges were going to be brought.
Last week when Helio’s attorney met with the judge, the judge would not agree to a lengthy delay in holding the trial and suggested a summer date. Helio’s attorney then requested the early March 2008 date, but this week has stated there are other clients and other matters which interfere with now having the trial in March 2008.
November 14th, 2008 at 2:42 pm
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