How To Sell Freedom For Profit

Why A Bankrupt America and Blind Loyalty have sold in excess of one million two hundred thousand copies [1993-April 1999].

We the People...P. O. Box 382, Chico, CA 95927

All checks and money orders must be made payable to Devvy Kidd

The Wallace Institute:Individual or Corporate Sponsorship

We thank you in advance for your donation and pledge of support.

If you have any questions about the institute, please don't hesitate to contact Devvy Kidd at 916-925-3430; e-mail is devvy@jps.net or snail mail:P.O. Box 60543,Sacramento, California 95860.
The Wallace Institute:Individual or Corporate Sponsorship

Please make checks or money orders payable to: The Wallace Institute.

Donations above include shipping and handling. If you are mailing this form, please send it to:Devvy Kidd, P.O. Box 60543, Sacramento, CA 95860
Please make checks or money orders payable to: The Wallace Institute.

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Oh My!!!!!!!!

To receive the prepaid price, sent your registration by funds, which the pay to line is left BLANK, or preferably by CASH, by September 5th to: Freedom Law School 13211 Myford Road #332, Tustin, CA 92782 (714)838-2896.

Freedom Law School

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Tax Protester Hall of Fame

Far-right extremists are making fortunes by promoting questionable financial schemes-(Intelligence Project: Southern Poverty Law Center)

Far-right extremists are making fortunes by promoting questionable financial schemes

The World of 'Patriots'

The number of "Patriot" groups is falling, but the remaining organizations are more racially oriented Common-law courts, until recently the fastest-growing part of the movement, have been hit hard by new legislation and law enforcement crackdowns. But many fear that the remaining courts, some of them underground, are increasingly dangerous. (Southern Poverty Law Center)

1997 Common-Law Courts-(Intelligence Project: Southern Poverty Law Center)

1997 Common-Law Courts

Terry Nichols: A Case Study of the Far Right

Common-law courts, the clearest current incarnation of Posse thought, are the most radical segment of today's sovereignty movement. That movement is bent on creating a legal and financial system complete with its own courts and money. Both Posse leaders and common-law advocates have taught followers how to achieve "sovereign" status to immunize themselves from the jurisdiction of the state and its courts. After declaring themselves sovereign "asseveration," in Posse terminology members create their own grand juries and courts. Then, operating as a militia, adherents believe themselves empowered to enforce those pseudo-courts' judgments. Terry Nichols, too, was a pure product of the Posse. (Southern Poverty Law Center)

Terry Nichols: A Case Study of the Far Right

April 2, 1992 Terry renounces his U.S. citizenship in a letter to a Michigan state agency. Borrowing from Posse rhetoric, Nichols writes: "I no longer am a citizen of the corrupt political corporate state of Michigan and the United States of America... I follow the common laws..."

March 24, 1993 In a hearing on the First Deposit case, Terry refuses a judge's orders to come to the front of the courtroom. "I don't want to enter your jurisdiction. If I pass this fence here, do I enter your jurisdiction?" Later, he tells the judge: "I'm ... a layman, a natural person, a freedom of common-law citizen under threat and duress and to challenge the jurisdiction of this court."

April 2, 1994 In language derived from the Posse Comitatus, Terry writes the IRS, describing himself as a "non-privileged, natural-born free citisen" and claiming he is exempt from federal tax withholding. -(Intelligence Project: Southern Poverty Law Center)

Terry Nichols:(Intelligence Project: Southern Poverty Law Center)

Patriot Periodicals

An introduction to the most popular publications in the antigovernment movement

From theories about black helicopters and secret concentration camps to proposals for "untaxing" oneself, the publications of the so-called "Patriot" movement offer a glimpse into the bizarre and conspiratorial thinking of the extreme right. While militias, common-law courts and other Patriot groups make wide use of the Internet, radio and even television programming, it is in their periodicals that they reveal themselves most fully.(Intelligence Project: Southern Poverty Law Center)

Patriot Periodicals

True Gritz: Will the Real Bo Gritz Please Stand Up? He preaches fear and then sells the products to cope. (Southern Poverty Law Center)

True Gritz: Will the Real Bo Gritz Please Stand Up?

Active Patriot Groups in 1998 The Intelligence Project identified 435 "Patriot" groups that were active in 1998. Of these groups, 171 were militias, 31 were "common-law courts" and the remainder fit into a variety of categories such as publishers, ministries, citizens' groups and others. Generally, Patriot groups define themselves as opposed to the "New World Order" or advocate or adhere to extreme antigovernment doctrines (Intelligence Project: Southern Poverty Law Center)

Active Patriot Groups in 1998

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Oklahoma City, Ruby Ridge, and Waco -- examples of what happens when radical groups cross the line and in some cases, wreak havoc on a community, because government is their enemy. That's the theme of a special five-day report we began in conjunction with the second anniversary of the Oklahoma City bombing.

Crossing the Line, A special report produced by Pioneer Newspapers Inc.

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PATRIOT BEWARE!

[*excerpt]

False premise:"Wages or compensation for labor is not taxable [under an income tax]." (Media Bypass, April 1996)

Wages have always been considered taxable income. The first federal income tax, levied in 1862, called for the tax "upon the annual gains, profits or income of every person residing in the United States, whether derived from any kind of property, rents, interest, dividends, salaries, or from any profession, trade, employment, or vocation carried on in the United States or elsewhere, or from any other source whatever." That tax was unanimously upheld by the Supreme Court in Springer v. United States (1880). As already noted, when the Supreme Court overturned the income tax law of 1894 because the tax was unapportioned, the Court ruled that only unapportioned taxes levied against income derived from rents and dividends were unconstitutional, while taxes on income derived from labor were indirect taxes and therefore constitutional. The entire statute was voided because, the High Court ruled in Pollock v. Farmers Loan and Trust Co., striking only income taxes derived from property "would leave the burden of the tax to be borne by professions, trades, employments, or vocations; and in that way what was intended as a tax on capital would remain in substance a tax on occupations and labor. We cannot believe that such was the intention of Congress."

The current U.S. Code (Title 26, Section 61) defines the gross income subject to U.S. income taxation as "all income from whatever source derived, including ... (1) Compensation for services." And wages fall within the bounds of compensation for services.[The New American * February 17, 1997, PATRIOT BEWARE!, by Thomas R. Ed]

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WILLIAM COOPER EXHIBIT

William "Bill" Cooper & John Lear
The Fraud, The hoax and the Fight

BEHOLD A STALE HORSE
and THE HOUR OF THE CRIME: by UFO Magazine

The Militia Watchdog Links Page

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U.S. v. Arthur W. Morris, U.S. District Court, Eastern District of Michigan (1987) U.S. District Judge Avern Cohn compared defendant Morris with those who sell information to the Soviet Union. Equating Morris with treason and espionage, Cohn invoked the "Tax Protestor Doctrine" to toss out sentencing guidelines and gave the maximum sentence of 3 years and $30,000 to Morris, a first time misdemeanor offender. Morris was denied bond pending appeal and was incarcerated in a federal prison in Indiana.

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[excerpts from: USA v. Sloan]

Like moths to a flame, some people find themselves irresistibly drawn to the tax protestor movement's illusory claim that there is no legal requirement to pay federal income tax. And, like the moths, these people sometimes get burned.

Lorin G. Sloan believed these claims and because he acted upon them now faces four months in a federal prison; there can be little doubt that he has been burned. Because he put this theory into practice, in due course Mr. Sloan was charged with, tried on, and convicted by a jury of three counts of tax evasion, 26 U.S.C. s 7201. The district judge sentenced him to four months imprisonment on one count to be followed by four months of work release. Sentences of two and three years imposed on the other two counts were suspended. In addition, Mr. Sloan was placed on follow-up probation of five years, required to pay his tax deficiency and repay the costs of prosecution, and fined $200,000 (which was later suspended). The execution of Mr. Sloan's sentence was stayed pending the outcome of this appeal.

The real tragedy of this case is the unconscionable waste of Mr. Sloan's time, resources, and emotion in continuing to pursue these wholly defective and unsuccessful arguments about the validity of the income tax laws of the United States.

Despite our rejection of Mr. Sloan's legal analysis of the tax laws, we are not unmindful of the sincerity of his beliefs.

On the other hand, we are less sure of the sincerity of the professional tax protestors who promote their views in literature and meetings to persons like Mr. Sloan, yet are unlikely ever to face the type of penalties incurred by him.

It may be that our decision will not alter Mr. Sloan's views regarding the tax laws of this country, for he has stated that if we affirm his conviction without applying the law as he understands it, our decision will be "a sham to which I WILL NOT SUBMIT." It may also be that serving his sentence in prison will not alter Mr. Sloan's view. We hope this pessimistic assessment is incorrect.

We AFFIRM the conviction of Lorin G. Sloan on all counts.

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[excerpts: NEWMAN v. SCHIFF]

D. Mandatory Nature of the Federal Income Tax System.

Schiff's claim that there is nothing in the Internal Revenue Code that requires an individual to file a federal income tax return demands comment. The kindest thing that can be said about Schiff's promotion of this idea is that he is grossly mistaken or a mere pretender to knowledge in income taxation. We have nothing but praise for Mr. Newman's efforts which have helped bring this to light.

Section 6012 of the Internal Revenue Code is entitled "Persons required to make returns of income," and provides that individuals having a gross income in excess of a certain amount "shall" file tax returns for the taxable year. 26 U.S.C. s 6012. Thus, section 6012 requires certain individuals to file tax returns. United States v. Drefke, 707 F.2d 978, 981 (8th Cir.), cert. denied, 464 U.S. 942, 104 S.Ct. 359, 78 L.Ed.2d 321 (1983).

The district court stated that Schiff's argument is "blatant nonsense." Schiff did not challenge this ruling in his cross-appeal.

III. CONCLUSION.

We affirm the judgment of the district court for the reasons discussed above.

Although Newman has not "won" his lawsuit in the traditional sense of recovering a reward that he sought, he has accomplished an important goal in the public interest of unmasking the "blatant nonsense" dispensed by Schiff.

For that he deserves great commendation from the public.

Perhaps now CBS and other communication media who have given Schiff's mistaken views widespread publicity, see supra, pp. 461-62, will give John Newman equal time in the public interest.

Affirmed but without any costs against John Newman.

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ORDER

In February 1988, Kenneth Nelson was convicted in the United States District Court for the District of Nevada on three counts of failure to file income tax returns in violation of 26 U.S.C. s 7203. Nelson, represented by counsel Lowell H. Becraft, Jr., then appealed to this court claiming, inter alia, that the district court erred in refusing to give his proposed jury instruction that a United States citizen residing in the United States is not subject to the federal income tax laws.

By memorandum disposition dated March 22, 1989, this court affirmed Nelson's conviction, noting that Becraft's argument regarding the inapplicability of the federal tax laws to resident United States citizens had no basis in law. Becraft thereafter filed a petition for rehearing and/or suggestion for rehearing en banc [hereafter "petition for rehearing"]. In the petition for rehearing, Becraft once again argued that the federal tax laws are inapplicable to resident United States citizens.

Upon receipt of the petition for rehearing, we, sua sponte, issued a show cause order requesting Becraft to explain why damages in the sum of $2500 should not be assessed against him for filing a frivolous petition for rehearing. See Appendix A. We have now reviewed Becraft's several-hundred- page reply to our show cause order [hereinafter "reply"] and have reached the conclusion that Becraft's conduct warrants sanctions.

Federal Rule of Appellate Procedure 38 provides this court with the authority to impose sanctions to deter frivolous appeals and to conserve limited federal judicial resources. [FN1] See, e.g., Grimes v. Commissioner, 806 F.2d 1451, 1454 (9th Cir.1986) (per curiam); Trohimovich v. Commissioner, 776 F.2d 873, 876 (9th Cir.1985); Nunley v. Commissioner, 758 F.2d 372, 373 (9th Cir.1985) (per curiam). Pursuant to Rule 38, sanctions may be imposed against pro se litigants, Grimes, 806 F.2d at 1454; Trohimovich, 776 F.2d at 876, litigants represented by counsel, First Investors Corp. v. American Capital Financial Services, Inc., 823 F.2d 307, 310 (9th Cir.1987); Wisconsin v. Glick, 782 F.2d 670, 673-74 (7th Cir.1986), and/or directly against appellate counsel. Nevijel v. North Coast Life Ins. Co., 651 F.2d 671, 675 (9th Cir.1981); Coghlan v. Starkey, 852 F.2d 806, 818 (5th Cir.1988); Braley v. Campbell, 832 F.2d 1504, 1511 (10th Cir.1987).

FN1. Rule 38 provides: If a court of appeals shall determine that an appeal is frivolous, it may award just damages and single or double costs to the appellee.

In assessing the propriety of appellate sanctions, we must determine whether the issue raised on appeal--or as in this case, a petition for rehearing--is indeed frivolous. It is well settled that an appeal is frivolous when the result is obvious or the arguments of error are wholly without merit. Grimes, 806 F.2d at 1454; Gattuso v. Pecorella, 733 F.2d 709, 710 (9th Cir.1984); Dewitt v. Western Pacific Railroad Co., 719 F.2d 1448, 1451 (9th Cir.1983). We have no hesitation concluding that the petition for rehearing filed by Becraft in this case meets the frivolity standard.

Notwithstanding Becraft's insistence that his argument regarding the inapplicability of the federal income tax laws to resident United States citizens raises numerous complex issues, his position can fairly be reduced to one elemental proposition: The Sixteenth Amendment does not authorize a direct non-apportioned income tax on resident United States citizens and thus such citizens are not subject to the federal income tax laws. [FN2] We hardly need comment on the patent absurdity and frivolity of such a proposition. For over 75 years, the Supreme Court and the lower federal courts have both implicitly and explicitly recognized the Sixteenth Amendment's authorization of a non- apportioned direct income tax on United States citizens residing in the United States and thus the validity of the federal income tax laws as applied to such citizens. See, e.g., Brushaber v. Union Pacific Railroad Co., 240 U.S. 1, 12-19, 36 S.Ct. 236, 239-42, 60 L.Ed. 493 (1916); Ward, 833 F.2d at 1539; Lovell v. United States, 755 F.2d 517, 519 (7th Cir.1984); Parker v. Commissioner, 724 F.2d 469, 471 (5th Cir.1984); United States v. Romero, 640 F.2d 1014, 1016 (9th Cir.1981). Indeed, in Lovell, one of the more recent cases explicitly rejecting a Sixteenth Amendment argument virtually identical to Becraft's position in this case, the court sanctioned the pro se appellants for raising this and other federal tax exemption claims on appeal. See Lovell, 755 F.2d at 520. If a claim is sufficiently frivolous to warrant sanctions against a pro se appellant, it unarguably supports the assessment of sanctions against a seasoned attorney with considerable experience in the federal courts.

FN2. While Becraft devotes a good portion of his brief, petition for rehearing, and reply to a discussion of the structure of the Internal Revenue Service and the control numbers designated to income tax forms pursuant to the Paperwork Reduction Act, he does so only to provide support for his fundamental proposition that the Sixteenth Amendment does not authorize a direct non-apportioned tax on citizens residing in the United States. Hence, his entire legal argument hinges on the constitutionality of directly taxing resident United States citizens. Additionally, we note that much of Becraft's reply is also devoted to a discussion of the limitations of federal jurisdiction to United States territories and the District of Columbia and thus the inapplicability of the federal income tax laws to a resident of one of the states. We are somewhat perplexed as to why he included this contention in his reply since he omitted any reference to this issue in the petition for rehearing. In any event, as Becraft should be well aware, this claim also has no semblance of merit. The Eleventh Circuit summarily rejected the identical argument in United States v. Ward, 833 F.2d 1538, 1539 (11th Cir.1987), cert. denied, --- U.S. ----, 108 S.Ct. 1576, 99 L.Ed.2d 891 (1988), a case in which Becraft served as the defendant's appellate counsel.

In reaching the conclusion the Becraft's petition for rehearing is frivolous, we rely not only on the fact that the argument is in direct conflict with "firmly established rules of law for which there is no arguably reasonable expectation of reversal or favorable modification," McDougal v. Commissioner, 818 F.2d 453, 455 (5th Cir.1987), but also on the fact that this wholly meritless claim was pressed in a petition for rehearing after this court had already summarily rejected the claim and characterized it as having no basis in law. Thus, the result of the petition for rehearing was even more obvious than the initial appeal.

Indeed, it is beyond our comprehension that a competent attorney, which Becraft certainly is, could harbor a good faith belief that this panel or the court sitting en banc would reconsider the rejection of Nelson's claim of federal tax exemption. While a finding of bad faith is not necessary to impose sanctions under Fed.R.App.P. 38, see Coghlan, 852 F.2d at 814-815 (bad faith not required element of imposition of sanctions under rule 38); Braley v. Campbell, 832 F.2d at 1512 (finding of subjective bad faith unnecessary to impose sanctions under Rule 38); Grimes, 806 F.2d at 1454 ("The purpose of Rule 38 ... is to induce litigants to conform their behavior to the governing rules, regardless of their subjective belief."), the fact that Becraft likely filed the petition for hearing absent a good faith belief of its justification contributes to our strong conviction that Becraft's conduct warrants the imposition of sanctions. See Coghlan, 852 F.2d at 814 ("Bad faith may aggravate the circumstances justifying sanctions....")

Moreover, we believe that Mr. Becraft's litigation record in the federal appellate courts demonstrates the necessity of sending a message to Becraft that frivolous arguments will no longer be tolerated. Our research reveals that we are not the first appellate court in which Becraft has raised this patently frivolous Sixteenth Amendment claim. In Ward, a case in which Becraft served as defendant's appellate counsel, see supra, n. 1, the Eleventh Circuit characterized as "utterly without merit" the identical argument raised by Becraft here regarding the applicability of the federal tax laws to resident United States citizens. 833 F.2d at 1539. Moreover, Becraft also advanced the patently frivolous claim in Ward that the federal income tax laws apply only to residents of federal territories and the District of Columbia. Id.; see supra, n. 1.

Unfortunately, Becraft's record of advancing wholly meritless claims does not end with Ward. United States v. Stahl, 792 F.2d 1438 (9th Cir.1986), cert. denied, 479 U.S. 1036, 107 S.Ct. 888, 93 L.Ed.2d 840 (1987), and United States v. Sitka, 845 F.2d 43 (2d Cir.), cert. denied, --- U.S. ----, 109 S.Ct. 77, 102 L.Ed.2d 54 (1988), appeals in which Becraft served as co-counsel and counsel respectively, addressed the claim that the Sixteenth Amendment was never properly ratified and that therefore the federal courts lack jurisdiction to entertain tax evasion prosecutions. Needless to say, both courts soundly rejected this contention. See Sitka, 845 F.2d 44- 47; Stahl, 792 F.2d 1438-1441. Becraft's record in the federal courts thus exhibits an alarming willingness to utilize appellate court resources to adjudicate claims that a competent attorney should realize have no reasonable possibility of success.

Based on Becraft's conduct in this case and prior cases, it is clear to us that Becraft has no appreciation for the limited nature of the federal judicial resources upon which all aggrieved individuals depend for vindication of statutory and constitutional rights. For if he did have respect for the extreme demands constantly placed on the court's resources, he would not continue to use the courts as testing ground for revisionist historical theories that have absolutely no basis in law.

While we are in general accord with the Seventh Circuit's statement that "[c]riminal defendants and their lawyers must abide by the rules that apply to other litigants, ... including the principle that litigating positions must have some foundation in existing law or be supported by reasoned, colorable arguments for change in the law," Wisconsin v. Glick, 782 F.2d 670, 673 (7th Cir.1986) (citation omitted), we are hesitant to exercise our power to sanction under Rule 38 against criminal defendants and their counsel. With respect to counsel, such reluctance, as evidenced by the absence of authority imposing sanctions against defense counsel, [FN3] primarily stems from our concern that the threat of sanctions may chill a defense counsel's willingness to advance novel positions of first impression. Our constitutionally mandated adversary system of criminal justice cannot function properly unless defense counsel feels at liberty to press all claims that could conceivably invalidate his client's conviction. Indeed, whether or not the prosecution's case is forced to survive the "crucible of meaningful adversarial testing" may often depend upon defense counsel's willingness and ability to press forward with a claim of first impression. See United States v. Cronic, 466 U.S. 648, 656, 104 S.Ct. 2039, 2045, 80 L.Ed.2d 657 (1984). Moreover, because of the significant liberty deprivation often at stake in a criminal prosecution, courts generally tolerate arguments on behalf of criminal defendants that would likely be met with sanctions if advanced in a civil proceeding. See Glick, 782 F.2d at 673.

FN3. Our research did not reveal any case in which the court has imposed sanctions on defense counsel under Rule 38 and only one case in which sanctions were assessed against a criminal defendant. See Glick, 782 F.2d at 673-74 (state criminal defendants sanctioned for bringing frivolous appeal after unsuccessfully attempting to remove their state criminal prosecutions to federal court).

Notwithstanding the legitimate countervailing concerns that accompany imposing sanctions against defense counsel, we nevertheless believe that when a criminal defense counsel reasserts an argument in a petition for rehearing which was summarily rejected on direct appeal, and which flies in the face of unambiguous, firmly established law, that attorney exposes himself to the imposition of sanctions under Rule 38. Accordingly, we order Becraft to pay $2,500 in damages. With so many worthy claims waiting to be adjudicated, we are not obliged to stand by silently when an attorney repeatedly breaches his professional responsibility to the court

We are fully confident that our assessment of sanctions for a frivolous petition for rehearing in this case will have no deterrent effect on litigants and attorneys' advancement of reasonably based novel positions in the future. We sincerely hope, however, that this assessment will deter Becraft from asking this and other federal courts to expend more time and resources on patently frivolous legal positions. [FN4]

FN4. We wish to emphasize that our decision in this case should not be read as authority for imposing sanctions against a criminal defense counsel for a frivolous direct appeal following conviction; we express no opinion on whether or in what circumstances Rule 38 sanctions may be imposed for such an appeal.

The Clerk of this Court shall enter a judgment in the sum of $2,500 in favor of the United States of America and against Lowell H. Becraft, Jr.

APPENDIX A

ORDER

Counsel for the Appellant Lowell H. Becraft, Jr., 209 Lincoln Street, Huntsville, Alabama 35801, is ordered to show cause why damages in the sum of $2,500 should not be imposed upon him for filing a frivolous petition for rehearing and suggestion for rehearing en banc.

The reasons for the issuance of this order to show cause are as follows:

1. Appellant Kenneth Nelson was convicted in the United States District Court for the District of Nevada on three counts of failure to file income tax returns in violation of 26 U.S.C. s 7203.

2. By memorandum disposition dated March 22, 1989, this court affirmed the judgment of the district court.

3. On appeal, Nelson claimed, inter alia, that the district court erred in refusing to give his proposed jury instructions concerning his theory that a United States citizen is not a "person" and that his wages were not "income" within the meaning of the Internal Revenue Code.

4. In affirming Nelson's conviction, this court emphasized that his construction of the Internal Revenue Code has been consistently rejected by federal courts and had no basis in law.

5. On April 5, 1989, Lowell H. Becraft, Jr., as attorney for Appellant Nelson, filed with this court a petition for rehearing and suggestion for rehearing en banc.

6. In this petition, Nelson realleges the inapplicability of federal tax laws to income earned by United States citizens.

7. Counsel for Nelson acknowledges in his petition that this issue had been presented to, and rejected by, this court in its memorandum disposition of March 22, 1989.

8. While the court did not impose sanctions in its memorandum disposition, the issue of the applicability of federal tax laws to this case was and is patently frivolous as it finds no support in the Internal Revenue Code and ignores clear legal precedent. See Malhiot v. S. Cal. Retail Clerks Union, 735 F.2d 1133, 1137 (9th Cir.1984), cert. denied, 469 U.S. 1189, 105 S.Ct. 959, 83 L.Ed.2d 965 (1985) (appeal frivolous when "result is obvious or [when] the claims of error are wholly without merit").

9. Frivolous petitions such as this impose an unjustified burden on the federal judiciary. To raise the same frivolous contention on a petition for rehearing and suggestion for en banc review forces this court to consider sanctions in order to assure that its responsibilities are not hindered by wasteful, time-consuming petitions requiring consideration by not only a three- member panel of the court but also the entire court because of the en banc suggestion.

10. Pursuant to F.R.App.P. 38, this court has the authority to impose sanctions to deter frivolous appeals and to conserve federal judicial resources. See, e.g., First Investors Corp. v. American Capital Financial Services, Inc., 823 F.2d 307, 310 (9th Cir.1987); Trohimovich v. Commissioner, 776 F.2d 873, 875-76 (9th Cir.1985); Nunley v. Commissioner, 758 F.2d 372, 373 (9th Cir.1985) (per curiam); Stites v. United States Government, 746 F.2d 1085, 1086 (5th Cir.1984) (per curiam).

Therefore, Lowell H. Becraft, Jr., is ordered to show cause as set forth in this order.

All documents in opposition to this order must be filed with the Clerk of this court within 20 days from the date of the filing of this order.

The Clerk of the Court shall serve a copy of this order upon Mr. Becraft by United States mail and shall furnish counsel for appellee with a copy of this order.

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Excerpts from:

In his complaint, Miller alleges that the sixteenth amendment is unconstitutional because it was illegally ratified. More specifically, he states in Count II that a book by William Benson and "Red" Beckman entitled The Law That Never Was (1985), documents the impropriety of the ratification process. Miller asked the district court to determine the legality of the sixteenth amendment, refund the $75 he paid toward the frivolous filing penalty, and rescind the unpaid balance of the penalty. The government, in turn, moved for summary judgment and requested attorneys' fees and costs for defending against a frivolous suit.

On September 3, 1987, the district court granted the government's motion and dismissed Miller's complaint. The district court also sanctioned Miller $1500 under Rule 11 of the Federal Rules of Civil Procedure and enjoined him from filing any further actions before it without first obtaining leave of court. The district court specified that leave to file would hinge upon Miller's certification that his claim is not one which he has previously pressed before the court and lost, and that the claim is brought in the good faith belief that it is not frivolous. On October 5, 1987, Miller filed a motion asking the district court to reconsider its sanctions. This the district court declined to do, and on December 1, 1987, Miller filed a notice of appeal. In this appeal, Miller argues that he brought his claim in good faith and that the sanctions are excessive.

II. ANALYSIS

The merits of the district court's imposition of sanctions in the present case are not before us since Miller filed his notice of appeal from the district court's September 3, 1987, dismissal order well beyond the sixty-day period prescribed for suits against the United States. Fed. R. App. P. 4(a)(1); Pryor v. U.S. Postal Service, 769 F.2d 281, 284 (5th Cir.1985). Adherence to this time limit is both mandatory and jurisdictional. Browder v. Director, Dept. of Corrections of Illinois, 434 U.S. 257, 264, 98 S.Ct. 556, 560, 561, 54 L.Ed.2d 521 (1978). Thus, the failure to file a timely notice from the district court's final judgment leaves us without appellate jurisdiction. Wort v. Vierling, 778 F.2d 1233, 1234 (7th Cir.1985). Miller's motion urging the district court to reconsider its order of sanctions--filed over one month after the court entered the order--must be treated as a motion under Rule 60(b). Browder, 434 U.S. at 263 n. 7, 98 S.Ct. at 560 n. 7. As such, it did not toll the time in which to file the notice of appeal from the district court's judgment. Id.; Marane, Inc. v. McDonald's Corp., 755 F.2d 106, 112 (7th Cir.1985). Our review is therefore limited to the question whether the district court abused its discretion in denying the motion for reconsideration. Marane at 755 F.2d 112; Tunca v. Lutheran General Hospital, 844 F.2d 411, 412 (7th Cir.1988).

Relief from a judgment under Rule 60(b) is limited to the following reasons: mistake, inadvertence, excusable neglect, newly discovered evidence, fraud, and "any other reason justifying relief from the operation of the judgment." Fed.R.Civ.P. 60(b). Miller made no reference to any of these grounds in his motion to reconsider. Rather, his request for relief is based upon the allegations that the district court encouraged him to prosecute his case by granting him a jury trial in response to his request; that he was not using the courts frivolously because he was following a statutorily proscribed procedure; and that the sanctions against him are excessive. Each of these claims is without merit. For example, the first claim is unavailing since the district court's order granting Miller a jury trial according to 28 U.S.C. s 2402 if his case proceeded to that point cannot legitimately be considered "encouragement" to prosecute a frivolous action. Miller's contention that his claims are not frivolous merely because he is following the procedure enumerated in 26 U.S.C. ss 6702 and 6703 is equally meritless. However, his argument on this point has highlighted a trend of rather significant proportions which may benefit from some attention.

When Congress instituted the frivolous return penalty provisions of 26 U.S.C. ss 6702 and 6703, it was seeking to address the vexing problem associated with the approximately 13,600 illegal protest returns the Internal Revenue Service had under investigation as of June 30, 1981. The legislative history of these provisions reveals that Congress sought to implement a mechanism for addressing the "rapid growth in deliberate defiance of the tax laws by tax protestors." S.Rep. No. 97-494, 97th Cong., 2d Sess. 278, reprinted in 1982 U.S.Code Cong. & Ad. News 781, 1024 [hereinafter Senate Report]. To that end, s 6702 was intended to provide the IRS with an immediately assessable penalty for such frivolous protest returns. The Senate Report specifically stated that "the penalty will be immediately assessable against any individual filing a return in which many or all of the line items are not filled in except for references to spurious constitutional objections." Senate Report, 1982 U.S.Code Cong. & Ad.News at 1024. Similarly, it is clear that s 6703 was designed to provide only limited federal judicial review of whether the penalty imposed under s 6702 was proper in light of the aims of Congress. Senate Report, 1982 U.S.Code Cong. & Ad.News at 1025.

The legislative history of these provisions makes it clear that in this case as well as in his two previous actions, Miller has sought to turn the judicial review procedure of s 6703 on its head by making it a vehicle for challenging the constitutionality of the sixteenth amendment. Miller's repeated abuse of s 6703 to press his stale constitutional claims has confounded Congress' larger and unquestionably legitimate aim of maintaining the integrity of the income tax system. Senate Report, 1982 U.S.Code Cong. & Ad.News at 1025.

Our research into the practice employed by Miller and the issues he has attempted to raise reveals a troubling pattern of similar cases. Schoffner v. Commissioner of Internal Revenue, 812 F.2d 292 (6th Cir.1987) (challenge to frivolous penalty assessment for filing return containing asterisks and blanket fifth amendment objection); Eicher v. United States, 774 F.2d 27 (1st Cir.1985) (challenge to frivolous penalty assessment for filing return containing asterisks and blanket fifth amendment objection); Paulson v. United States, 758 F.2d 61 (2d Cir.1985) (challenge to frivolous penalty assessment for filing return containing asterisks and series of constitutional objections); Boomer v. United States, 755 F.2d 696 (8th Cir.1985) (challenge to frivolous penalty assessment for filing return containing asterisks and blanket constitutional objections); Baskin v. United States, 738 F.2d 975 (8th Cir.1984) (challenge to frivolous penalty assessment for filing return containing asterisks and blanket fifth amendment and other constitutional objections); Parker v. Commissioner of Internal Revenue, 724 F.2d 469 (5th Cir.1984) (challenge to tax deficiency determination and penalty for filing an inappropriate return containing asterisks and blanket fifth amendment objection).

As best we can surmise, Miller, like the plaintiffs in the foregoing cases, has followed the advice of those associated with the "tax protester movement." The leaders of this movement conduct seminars across the country in which they attempt to convince taxpayers that the sixteenth amendment and assorted enforcement provisions of the tax code are unconstitutional. See, e.g. United States v. Hairston, 819 F.2d 971, 972 (10th Cir.1987). Members are encouraged to defy the income tax filing requirements through returns like those noted above. They are then instructed to obtain a jury trial so that potentially like-minded jurors may be persuaded to acquit in the exercise of their power of jury nullification. See, e.g., United States v. Ogle, 613 F.2d 233, 236-37 (10th Cir.1979). The movement's manifesto, Benson and Beckman's The Law That Never Was, is a collection of documents relating to the ratification of the sixteenth amendment, and is intended to be both a call to arms for the movement and "exhibit A" in the trials of tax protesters who argue that the sixteenth amendment was illegally ratified. Id. at xvii ("The tax protestor will be the great American hero of 1985 just as in 1776. It was tax protestors, not any political party, or judge or prosecutor who gave us our great Constitutional Republican form of government. The tax protest is more American than baseball, hot dogs, apple pie or Chevrolet!!").

In the eyes of the authors, the most damning evidence of the illegality of sixteenth amendment is a 1913 memorandum from the Solicitor of the Department of State to then Secretary of State Knox outlining the minor grammatical discrepancies in the instruments ratified in many of the states. This circuit has squarely addressed the merits of the ratification argument in two recent cases. United States v. Foster, 789 F.2d 457, 462-63 (7th Cir.1986) (73 years of application of the amendment is very persuasive on the question of validity); United States v. Thomas, 788 F.2d 1250, 1253-54 (7th Cir.1986) (amendment treated as properly adopted under the "enrolled bill rule"). In Thomas, we explained that: Benson and Beckman did not discover anything; they rediscovered something that Secretary Knox considered in 1913. Thirty-eight states ratified the sixteenth amendment, and thirty-seven sent formal instruments of the ratification to the Secretary of State.... Only four instruments repeat the language of the sixteenth amendment exactly as Congress approved it. The others contain errors of diction, capitalization, punctuation, and spelling.... [the defendant] insists that because the states did not approve exactly the same text, the amendment did not go into effect. Secretary Knox considered this argument. The Solicitor of the Department of State drew up a list of the errors in the instruments and--taking into account both the triviality of the deviations and the treatment of earlier amendments that had experienced more substantial problems--advised the Secretary that he was authorized to declare the amendment adopted. The Secretary did so.... [his] decision is now beyond review. Id. at 1253 (emphasis in original). See also United States v. Stahl, 792 F.2d 1438, 1439 (9th Cir.1986), cert. denied 479 U.S. 1036, 107 S.Ct. 888, 93 L.Ed.2d 840 (1987) (propriety of the ratification process is a political question).

We find it hard to understand why the long and unbroken line of cases upholding the constitutionality of the sixteenth amendment generally, Brushaber v. Union Pacific Railroad Company, 240 U.S. 1, 36 S.Ct. 236, 60 L.Ed.2d 493 (1916), and those specifically rejecting the argument advanced in The Law That Never Was, have not persuaded Miller and his compatriots to seek a more effective forum for airing their attack on the federal income tax structure. See Foster, 789 F.2d at 463 n. 6 (the propriety of the ratification of a constitutional amendment may be a non-justiciable political question). Determined and persistent tax protesters like Miller seek to utilize the federal judicial forum without consideration of the significant limitations on the authority of both the district courts and the courts of appeal. One such limitation stems from the bedrock principle of stare decisis: lower courts are bound by the precedential authority of cases rendered by higher courts. U.S. Ex Rel. Shore v. O'Leary, 833 F.2d 663, 667 (7th Cir.1987). This limitation on judicial power is one of the cornerstones of the legal structure in that it serves broader societal interests such as the orderly and predictable application of legal rules. This doctrine prevents us from disregarding the Supreme Court's opinions upholding the constitutionality of the sixteenth amendment. The Court's decisions are binding on us and the district court absent strong evidence that the Court will overrule its own cases. Colby v. J.C. Penney Co., 811 F.2d 1119, 1123 (7th Cir.1987). We perceive no signs that the Supreme Court is harboring any such intentions with regard to the validity of the sixteenth amendment.

Miller would have us disregard this principle and overturn almost three quarters of a century of settled law and declare the sixteenth amendment unconstitutional. He has asked us and the district court to do that which we have no authority to do. He would have us substitute one brand of lawlessness (from his perspective) with a form of lawlessness of our own. Miller and his fellow protesters would be well advised to take their objections to the federal income tax structure to a more appropriate forum.

This advice has been offered on other occasions. Coleman v. Commissioner of Internal Revenue, 791 F.2d 69, 72 (7th Cir.1986) (tax protesters "must choose other forums, and there are many available"). In the circumstances, the sanctions imposed by the district court were appropriate. With particular reference to the injunction limiting Miller's access to the federal courts, we note that the district court was struggling with a persistent tax protester who was undaunted by his failure in two previous cases in as many years. A monetary sanction of $500 in the latter of those two cases did not prevent Miller from returning to the federal courthouse for yet a third time with the identical claims. The district court was thus faced with a plaintiff as intransigent as the tax protester we sanctioned in Lysiak v. C.I.R., 816 F.2d 311 (7th Cir.1987), and properly drew upon the injunctive relief we imposed in Lysiak to fashion a remedy to address the parallel strains that Miller's frivolous filings were having on its crowded docket and limited resources. Id. at 313. Miller may exercise his right to access the federal courts upon a simple showing that his claim is colorable. See Coleman, 791 F.2d at 72 (there is no constitutional right to bring a frivolous suit). We therefore reject Miller's claim that the sanctions were excessive and hold that the district court did not abuse its discretion in denying his motion for reconsideration.

This, however, is not the end of the matter. The present appeal is a patently frivolous one that has generated additional costs for the defendants and this court. Five years ago we warned plaintiffs like Miller that while the doors of the courthouse are open to good faith appeals, "we can no longer tolerate abuse of the judicial review process by irresponsible taxpayers who press stale and frivolous arguments ... In the future we will deal harshly with frivolous tax appeals and will not hesitate to impose sanctions under appropriate circumstances." Granzow v. C.I.R., 739 F.2d 265, 269-70 (7th Cir.1984). This is such a circumstance. Although Miller is acting pro se, he knew or should have known that his position was groundless. Coleman, 791 F.2d at 71 (a court may and should impose sanctions if a person knows his position is groundless). Each of the three district judges before whom Miller has appeared have taken pains to explain the meritlessness of his position. Scott v. Younger, 739 F.2d 1464, 1467 (9th Cir.1984) (reassertion of issues disposed of in prior proceedings is sanctionable). In conformity with our policy for such tax protester cases, Coleman, 791 F.2d at 73, we hereby sanction Miller $1500 in lieu of attorneys' fees under Rule 38 of the Federal Rule of App. Procedure.

The judgment of district court is affirmed, with double costs and $1500 in damages imposed against the plaintiff-appellant. Miller is ordered to make payment to the Clerk of this court within thirty (30) days by a check made payable to the U.S. Treasury.

So ordered.

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