Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Laino v. United States

decided: October 6, 1980.

PASQUALE LAINO AND MINERVA LAINO, PLAINTIFFS-APPELLANTS,
v.
UNITED STATES OF AMERICA, JEROME KURTZ, AS HE IS THE COMMISSIONER OF THE INTERNAL REVENUE SERVICE, AND GEORGE S. ALBERTS, AS HE IS THE DISTRICT DIRECTOR OF INTERNAL REVENUE, BROOKLYN DISTRICT, DEFENDANTS-APPELLEES



Appeal from an order entered in the United States District Court for the Eastern District of New York, Henry Bramwell, Judge, dismissing for lack of subject matter jurisdiction a complaint seeking to enjoin the Commissioner from collecting income taxes assessed on unreported income from gambling activities. Affirmed.

Before Friendly and Meskill, Circuit Judges, and Bonsal, District Judge.*fn*

Author: Friendly

Pasquale and Minerva Laino, husband and wife, brought suit in the District Court for the Eastern District of New York, seeking to declare null and void an income tax assessment based on unreported income from gambling activities asserted against them by the Commissioner of Internal Revenue, and to enjoin the Commissioner from enforcing a lien to collect the tax.*fn1 The district court dismissed the complaint for lack of subject matter jurisdiction and this appeal followed. We affirm.

Appellants' tax problems date back to 1973, when the New York City Police Department placed Pasquale Laino under surveillance on suspicion of bookmaking activities. According to the sworn affidavit of Patrolman Robert Patterson, on five days in April beginning on April 2, 1973, Laino was observed receiving slips of paper and money in bill form from a variety of persons at a social club in Brooklyn. In a typical transaction, a "runner" would enter the premises, hand an envelope or brown paper bag containing the policy slips and cash to Laino, who would then count the money, place the slips behind a counter and stash the bills in his pocket. Late in the afternoon Laino would put all the slips and bills in a large brown paper bag and give the bag to someone else, who would then leave the club and drive off. The affidavit also alleged that on one occasion the large brown paper bag containing the day's receipts was placed in the trunk of a Cadillac regularly used by Laino, and that on one afternoon late in April, the bag was taken directly to Laino's residence in Queens. Based on this affidavit, a search warrant issued and a raid of the Laino home took place on May 3, 1973. In the course of their search, the police seized 8 banker statements, 142 controller statements, 9 pay and collect slips, 4 controller ribbons, 181 weekly collectors' records, one adding machine, and $1,713 in currency.

Pasquale Laino was arrested and indicted on one count of promoting gambling in the second degree and one count of possession of gambling records in the second degree. Penal Law, McKinney's Consol. Laws of N.Y.Ann., ยงยง 225.05, 225.15. On January 7, 1974, Laino withdrew his pleas of not guilty and pled guilty to the second count of possession of gambling records. Upon the recommendation of the district attorney, the court accepted the plea. Prior to sentencing, counsel for Laino made the following statement, which we shall relate because of the importance attached to it by appellants:

He has not been previously convicted of any crime. His involvement I can say was a minor one. These were not his personal records. He was an employee of someone making a normal salary for just holding the records. He is not anything big in the hierachy. He is like a middle man. He is gainfully employed.

This colloquy continued as follows:

The Court: How old are your children?

The Defendant: The oldest one is eight, six, three and three months.

The Court: How old are you, sir?

The Defendant: Thirty-three years old.

The Court: Well, I don't think any useful purpose would be (served by) putting you on probation. If you have been fooling around with policy or gambling, this is the time to stop.

Laino received a fine of $1,000.

On July 20, 1977, the Internal Revenue Service (IRS) mailed a notice of deficiency to appellants, notifying them of unpaid taxes for 1973 in the amount of $57,677.87 plus interest and penalties. The amount of unreported taxable income was computed as follows: from 5 days of betting slips totalling $67,115.70 seized in the raid on Laino's house, an average per day of $13,423.14 was obtained. This daily average was multiplied by 29 days, yielding a figure for gross receipts equal to $389,271.06. Profits were estimated at thirty-five percent, resulting in ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.