50 Years a Lawyer

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Lessons
From the Past

Last month
marked my 50 years as a member of the California Bar. In the course
of those years there were events that need to be told for the benefit
of younger lawyers and citizens. The Founders pointed out the danger
to freedom governments can be. Here are two examples that crossed
my path. The first involved Harry Margolis, a tax lawyer the Bar
will be talking about for a long time. The second involves an attorney
named Robert Stanley. At first it appears to be a case of an attorney
being too close to criminal clients, and being convicted and sentenced
to six years in the federal penitentiary. That is the way I thought
it was until 30 years later when I, by chance, learned the real
story.

The Indomitable
Harry Margolis

Margolis was
the most flamboyant tax lawyer the nation has ever known. Some lawyers
have called him the father of tax planning, but not in the view
of the IRS. He was a thorn in their side and they were determined
to get rid of him. He had many famous people as clients like Nat
King Cole and others in the Hollywood crowd. The IRS organized a
task force and they told me they had as many as 50 agents against
Margolis. They then brought in the criminal division, and brought
forth 34 indictments against Margolis. They made a big fanfare about
their indictments in the national newspapers, that it was "a
great breakthrough" after years of investigation. They brought
out special prosecutors from the East to make certain to get Margolis
after all their work. The trial was in San Francisco and lasted
months. Margolis defended himself. Many of the charges against Margolis
were dismissed by the judge after the prosecution rested. The rest
went to the jury. The jury found Margolis not guilty on all charges.

It was a humiliating
defeat, but the prosecution would not give up. After some years
they indicted Margolis again but for only 12 counts this time. The
indictments were all felony tax crimes. Again Margolis defended
himself. This time the entire case never went to the jury. The court
said they failed to make out a case and all charges were dismissed.
At that time, Margolis was diagnosed with brain cancer and died
shortly thereafter.

I had worked
for Margolis for a year and then he fired me. I had criticized his
tax planning as being flawed. I was talking about the civil side.
No criminal charges were pending at that time. In time the civil
side proved his downfall. It was unsound, but not criminal. The
IRS came to me and asked me to help them against Margolis in their
criminal case, as I knew his system. I said NO because I did not
believe he had done anything criminal. He was aggressive but still
within the law. I told them I thought he would win. The government
spent millions of taxpayer funds to get Margolis, but his indomitable
spirit was too much for them, even with all their power.

Criminal
Defense Lawyers Beware

Robert Stanley
was drafted in the 1950s and got assigned to the JAG Corp doing
criminal defense work. After the army, he went on to law school
at USC, and was attracted to defense work. You could say he was
too successful for the Justice Department, which wanted to put him
out of business. They charged him with corrupting a witness by zealously
coaching him too much. He was tried in Los Angeles and found not
guilty in a trial before a judge acting as his own attorney. But
the prosecutors were not satisfied. They were determined to get
Stanley, by hook or crook. Two men with a packet went to Stanley's
office and offered to pay him $2000 to deliver the package to a
bank in Chicago. He agreed. The next day he flew to Chicago. As
he got off the plane he was arrested by FBI agents. The packet was
filled with securities that had been stolen. He was charged with
transporting stolen property across state lines. He tried to defend
himself with a judge trial, but this time unsuccessfully. He was
sentenced to six years in the federal penitentiary. But that is
not the whole story, which I learned about 30 years later from a
friend of mine going back to the 4th grade. He had been
a deputy sheriff in Los Angeles just retired. He told me the story
of a sting operation against an attorney, not knowing I knew about
the attorney and the other side of the story.

What
had really happened was a sting operation with the prosecution
manufacturing a crime that did not exist – the essence of entrapment.
The thieves had been caught and the stolen securities were in police
custody. They then hatched the plan to give the securities back
to the thieves and have them take the stolen securities to Stanley
for him to take them in a package to Chicago where he would be arrested.
The thieves would then be given a light sentence for their part
in the sting. Most of the deputies knew the real story.

I knew Stanley
from high school. I was the Best Man at his wedding. He asked me
to review the transcript of his trial. I could not find any basis
for a new trial. I was unaware the whole thing was a set-up. I did
check with Chicago attorneys and they said do not try a case in
Chicago without local lawyers.

This
ended his legal career but also his political career as he had run
for Congress. He looked after family affairs, was involved in some
business ventures in the end not too successful. He moved to Vermont
living a pastoral life with a serious heart condition and died.

Thus ended
two of the most unusual cases in my legal career. The lessons to
be learned are frightening — that the government can turn on a citizen
they do not like and destroy that person, and there is no remedy
for their misdeeds. Citizens beware!


April
6, 2007

Attorney
Charles Adams (send him mail)
is
the author of When
in the Course of Human Events: Arguing the Case for Southern Secession
,
and Those
Dirty Rotten Taxes: The Tax Revolts That Built America
. Much
of this material and more on this subject can be found in his book,
For
Good and Evil: The Impact of Taxes on the Course of Civilization
.

Charles
Adams Archives

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