The conviction of Donald Stanley Lavigne on seven counts of knowingly and fraudulently filing false income tax returns and three counts of other false statements relating to bankruptcy was somewhat curious. The income tax issue was omitting 1099-MISC income from being an insurance broker. The total income involved averaged just over $50,000 per year for the years 2013 to 2018. Given the very limited resources of IRS CI it struck me as small beans. Mr. Lavigne going pro se and not doing a plea deal is not that odd, unwise as it might be. But the curious thing is if you are going to be that way, why not go with a jury?
A Man Standing On The Land
In the opinion Judge David M. Lawson of the US District Court for the Eastern District of Michigan remarks that he sees Mr. Lavigne as an educated and intelligent man who has fallen under the influence of pseudolegal theories based on invalid and discredited concepts of law and government. I can give you a little feel for that from excerpts from the transcript of the arraignment hearing that took place not long after he was arrested:
DEFENDANT LAVIGNE: Oh, are you talking to me?
THE COURT: I am. Would you approach the lectern?
DEFENDANT LAVIGNE: That’s the position for the defendant. I am a man standing on the land. My flesh lives, my blood flows and I have a soul. I’m not the defendant and I’m not Mr. Lavigne and I am here for 2:21-cr-20355.
THE CORT: Thank you, sir. Since you are here for Case 2:21-cr-20355, would you please stand and approach the lectern?
DEFENDANT LAVIGNE: Okay. So I will stand but I won’t approach the lectern. That’s the position for the defendant and I am not the defendant in this matter.
For what it is worth 2:21-cr-20355 is the docket number of the case. The transcript of the trial will not be available on my budget till May 1, but from Judge Lawson’s summary things did not get better.
Mr. Lavigne appears to subscribe to the concept that he has two aspects or identities, one which he labels as a “person” or “corporate entity,” and the other as his “flesh and blood’ form. One spells his name with upper case letters. The other adds spurious and meaningless punctuation to his name. Although Mr. Lavigne puts special significance on these alternative nomenclature forms, these are ineffectual in law and are meaningless paper masks. They have no force or meaning in law, other than that they indicate an intention on Mr. Lavigne’s part to evade his lawful obligations and the authority of the Court and other branches of government.
I do have to say that I find the idea of standing there and saying you are a man on the land with living flesh, flowing blood and a soul kind of poetic. If it was a movie it would be a pretty sure sign you were the good guy. In real life federal court, not so much.
The Source Of HIs Tax Theories
The “man standing on the land” versus “corporate entity” was not the basis of Lavigne’s tax resistance. That came from Peter Hendrickson, author of Cracking The Code – The Fascinating Truth about Taxation in America (CtC), who maintains the Lost Horizons website. Mr. Hendrickson and I have been communicating since 2019 and I have been covering him since 2014.
Mr. Hendrickson confirmed that Mr. Lavigne has attended his conferences and even indicated that he was throwing in comments during this presentation.
I can never summarize Mr. Hendrickson to his satisfaction, but you can get his argument by investing an hour of lifespan in that presentation. Essentially the idea is that the income tax is much narrower than most of us think it is and the CtC educated exclude income from their returns that what I call the conventionally tax compliant are misled into including. Mr. Hendrickson and I continue to agree to disagree.
Apparently at the same event, Mr. Lavigne testified as to his own positive experience filing returns using the CtC methods.
Herein may be the explanation for IRS CI chasing such small beans.
Cherry Picking
In the 2013 edition of Federal Tax Crimes (available on SSRN) Jack Townsend notes that though most taxpayers who commit tax crimes never get caught, the Government manages to discover enough of them so that it can cherry pick the most egregious and therefore winnable cases. The mission of IRS CI is not like that of a homicide squad, which at least as portrayed on TV can’t stand having any unsolved murders. Rather the limited resources available to prosecute tax crimes are dedicated to fostering confidence in the tax system and compliance with the law.
Hendrickson’s biggest practical argument in favor of the validity of his theory is the large number or refunds flowing to CtC educated taxpayers. He finds the explanation for that the I offer – limited IRS resources – preposterous. Judge Lawson noted the CtC connection
In the summer of 2017, the defendant participated at a gathering that was memorialized in a video posted on YouTube in which he declared he had been filing tax documents as prescribed by the advice in Cracking the Code since 2008. The defendant stated that when contacted by tax authorities, he “communicated back to the IRS and sent them away with a spanking.”
Judge Dawson also noted:
At that same meeting, the defendant advocated that “everybody in this country becomes a CTC educated filer and quits sending all their money to the government.” He said that his objective is that the government, which he labels “the beast,” “runs out of money.” Encouraging others at that gathering to follow his tax-return-filing practices, the defendant exhorted, “I am not afraid of the IRS. And anytime they send me anything, I spanked them, and shove it right back up their rear end and tell them to get out my face and they go away.”
Mr. Hendrickson responded to my inquiries about the Lavigne case by noting that although Lavigne’s heart was in the right place he might have made some errors in how he carried out his filings. He does, however indicate that the CtC connection may have been what provoked IRS interest. He wrote:
Overall, and despite his mistakes and the fact that his indictment ranges into areas outside of his efforts at CtC-educated filings, I think Don’s a good guy possibly selected for this attention in order to make him into this year’s “scare ’em away from CtC” poster child.
Mr. Hendrickson does not support the corporate/individual theory that encouraged Mr. Lavigne to spend his time in court aggravating the judges.
Why Not A Jury ?
My regular readers need no introduction to Kent Hovind, but for the rest he is an independent Baptist minister and Young Earth Creationists whose 2015 trial for tax related crimes made him a celebrity in the alt right echo chamber. Still incarcerated from his 2006 conviction, he used a more conventional lawyer. Eleven of the jurors thought he was guilty on all counts, but one did not, so Hovind ended up going free. The holdout was Don Camacho.
I ran my theory by attorney Peter Goldberger who has represented people charged with the sort of tax resistance Mr. Lavigne engaged in. He responded
I completely agree with you. It is possible to present a Cheek defense, if done carefully, and if the defendant is actually sincere, as reflected in the circumstantial evidence, but not otherwise. And a jury provides you with 13 chances to persuade someone of that, while a bench trial provides only one chance, and not the best one.
Cheek was a 1991 Supreme Court decision that held that a good-faith belief that the defendant was not violating the law prevents a finding that the defendant acted willfully. Ironically the decision didn’t do Mr. Cheek any good, but it might have worked for Mr. Lavigne.
Hovind Update
I spoke with Kent Hovind recently about You Tube cancelling his channel. He has also been coping with a critical article by Kelly Well in the Daily Beast. As far as my beat goes, he told me that he is still working on having his 2006 conviction overturned. Apparently his loss on the half billion dollar lawsuit has not caused him to give up.