When Background Testimony Is Not Useful to Jury

In suit against owner of natural gas development enterprises for filing false income tax returns, excluding defense expert testimony presenting "background information about the business of developing natural gas" because this evidence was not relevant to whether the defendant committed the charged crime of filing a false tax return and would only confuse the jurors, creating confusion and wasting time, in United States v. Kokenis, 662 F.3d 919 (7th Cir. Nov. 23, 2011) (No. 11-1426)

Occasionally an expert or experts will testify for the purpose of providing background or context to the jurors about matters in the case. However, the specific topic of expert testimony must be relevant. If relevance itself was not a basic requirement for the expert evidence, the testimony could probably be excluded as a waste of time or risking to confuse the jury. The Seventh Circuit recently reviewed a case of this sort. The proffered expert testimony was excluded as not relevant, and thus leading to juror confusion and time waste. As the circuit concluded, the proffered expert testimony was not helpful to jury in reaching a verdict.

In the case, defendant Kokenis was charged with filing a false income tax return. The defendant was an executive in a natural gas and energy company. The controller/accountant for the company informed the IRS of "concerns about fraudulent transactions" that he had observed in the preparation of the defendant's compensation and that the defendant "manipulated" the company's books so as to reduce the level of income to report to the government.

Part of the defense argument was that the defendant's representations of the level of the company's income was due to the vaguries of the natural gas and energy business, and not to the defendant's bad faith in trying to reduce reported income. To support this theory, the defendant sought to present testimony by a petroleum geologist [Brock] as to the the nature of gas energy drilling and delivery markets. As described by the circuit this expert:

would have presented “background information about the business of developing natural gas from the Atrium Shale in Michigan, including the multiple business and risk considerations at play.” Kokenis argues that Brock had “helpful information about the drilling process and the eventual delivery of gas to the buyer that would have provided context.” This background information (what the district court referred to as a “short course or a long course in oil development”) was not relevant because it was unconnected to the facts and issues in this case. It wouldn't have been helpful to the jury, and presenting it would have been confusing and a waste of time, all of which justify its exclusion under Rules 402, 403 and 702.
Kokenis, 662 F.3d at __ (citing United States v. Noel, 581 F.3d 490, 497 (7th Cir. 2009) (testimony did “not pass muster under Rule 702” when it was unhelpful to the jury).

The charged crime of filing a false return can be defined in three elements. The prosecution bore the burden of proving (1) that the defendant made and signed a tax return that he knew contained false or incorrect information on a material matter (e.g., something that had a natural tendency to influence IRS decisions), (2) that the defendant signed the return subject to the penalty of perjury, and (3) the defendant acted willfully in filing the charged tax return. See United States v. Gaudin, 515 U.S. 506, 509 (1995). In this light, the proffered background information on the natural gas industry had no relevance to whether the defendant knowingly made a false tax return. As the expert witness's information was not needed to understand the crime and the case, its presentation was superfluous -- which rendered it excludable.

Federal Rules of Evidence