162 F.2d 766 | 2d Cir. | 1947
The defendants, Hermann and Merlis and their companies, were charged with buying false ration cheques, with fraudulently obtaining subsidies from the Defense Supplies Corporation, and with conspiracy to commit both these crimes. The charge against them for buying forged ration cheques was in seventy-six counts, each count for a separate cheque (we shall speak of it as the “Information”) ; the charge for fraudulently obtaining subsidies was in twenty-five counts, each count for a separate payment (we shall speak of it as the “Subsidy Indictment”). Judge Picard submitted all the counts in the three accusations to the jury, except counts 9, 12, 13, 14 and 15 of the “Subsidy Indictment,” and the jury brought in a verdict of guilty on all counts submitted. The judge dismissed counts sixteen to twenty-five, inclusive, of the “Subsidy Indictment.” Pie then sentenced Merlis and Hermann to five years on each count of the “Subsidy Indictment,” the sentences to run concurrently; and to $5000 fine on each count cumulatively. The only corporate defendant in the “Subsidy Indictment” was the Fratik J. Murray Co., Inc., and he sentenced it to a fine of $5000 on each count. Under the “Information” he sentenced Merlis and Hermann to one year’s imprisonment on each of the seventy-six counts — the sentence to run concurrently with the sentence on the two indictments — and he fined them $1000 each on the first fifty counts; and he fined each corporation $1000 on each of the first fifty counts. Under the conspiracy indictment he sentenced Merlis and Hermann to two years’ imprisonment — the sentence to run concurrently with the other sentences; he fined each $5000; and he fined each corporation $5000. The result was that Merlis and Hermann have been sentenced to imprisonment for five years, and each to a fine of $105,000; the P'rank J. Murray Co., Inc., has been fined $105,000, and the Center Veal & Beef Co., $55,000. Upon this appeal the appellants depend chiefly upon the insufficiency of the evidence; but they also complain of the conduct of the trial by the judge and the prosecutor; and that the conspiracy indictment was invalid, the object of the conspiracy having been in part ac
The Center Company was a wholesale meat seller which bought most, though not all its meat from the Murray Company, a butcher which bought cattle direct from the breeders. Both were corporations, and Hermann and Merlis owned all the shares of each, half and half (Hermann had assigned his interest in the Center Company to his wife; .but it is not necessary to say that a jury would be justified in finding that this was a mere fetch to conceal his continued interest). He was president of the Murray Company, and Merlis was president of the Center Company. The two companies had a single New York office, but the Murray Company’s butchery was at Chester, New York; it did not appear that Merlis ever went to Chester, but Hermann was at time's at the New York office. Beginning in June, 1943, the Murray Company began to file with the Defense Supplies Corporation applications for subsidies, which the regulations allowed to butchers to cover the “spread” between what they had to pay to the unregulated breeders, and the “ceilings”which limited the prices they might charge to wholesalers or retailers. Each of these petitions had alleged that the Murray Company had filed with the O.P.A. a statement of the number of pounds of meat it had butchered, the number of points it had received from wholesalers; and that the statement had been accompanied by ration cheques of the Murray Company, to the order of the O.P.A. upon its ration point account in its own bank. Until April, 1944, all these petitions were false, because the Murray Company had never filed any such statements with O.P.A. and had not of course filed any ration cheques with them.
It does not appear how or why the O.P.A. learned that the Murray Company had been getting subsidies in this way; but it did learn so at least as eárly as April, 1944, and it demanded an accounting. The Murray Company then filed cheques drawn on its account for the deficiency up to date, together with a statement covering all past transactions. Since its point account in the bank was not large enough at the time to meet the necessary drafts, it built it up by cheques of the Center Company drawn on the Center Company’s point account in another bank for past purchases from the Murray Company. On the other hand, as the Center Company’s own account was not itself large enough to cover these drafts, that company built it up by the deposit of forged ration cheques, purporting to be drawn by meat dealers upon a New Jersey bank. These the Center Company procured as follows. They were in blank— without payees — and the company bought them from one, Tapen, a wholesale meat dealer, who had them from Bertola, a painter, who forged the makers’ names upon blank cheques, which he got from the bank’s teller, Hahn. As the cheques were presented at the bank, Hahn abstracted them before they were charged against the supposed makers’ accounts — out of the four-names used only one was fictitious. Thus the Center Company got a credit in its point account when the clearing house —Federal Reserve Bank — credited the cheques to its account in its own bank, and Hahn’s bank never apparently discovered that any charge had been made against it. How the charge, which must have appeared in the clearing house accounts, was concealed from Hahn’s bank docs not appear; but it makes no difference, for conccdedly the scheme was for a time successful. The Center Company continued to buy these cheques until the autumn of 1944, when the fraud was discovered; but not until it had bought cheques for about twelve million points, -ivhich — since the only testimony is that the price was one dollar a thousand — a jury might conclude had cost $12,000.
The guilt of the Murray Company upon those counts of the “Subsidy Indictment” which covered petitions filed before the Center Company began to pay ration cheques, is too clear for debate. Only someone in authority could conceivably have had any motive so to fill the company’s treasury: moreover, it is incredible that the practice should have gone on' for so long as it did without, not only the connivance, but the active direction, of Her-mann. The fact that his signature to the petitions was not proved — if it was not — is irrelevant; if he was not the guilty person,
The only question as to the “Information” is whether Merlis knew that the cheques were forged, — if so, he and the Center Company were guilty on all counts. That he could not have supposed that he was engaged in lawful transactions is apparent from their very nature, although there was corroboratory evidence. Such cheques could not be the subject of lawful sale; their only permissible use was in the purchase of meat and the jury was justified in imputing to Merlis knowledge of this basic condition of the business.' The only even plausible argument is that, although he may have known that the cheques were in some way illicit, nothing proved that lie knew them to have been forged. This can easily be shown to be without foundation; for there were only three possibilities: the cheques might have been bought from the makers; they might have been stolen; they might have been forged. The first we can rule out at once; no wholesaler or retailer, even if fraudulently disposed, would be likely to sell points, which were absolutely necessary to his own accounts. Moreover, if he did, he would not sell them to a confederate at such a price that the confederate could get his share of the loot by selling them at one dollar a thousand. Again, it was impossible that they should have been stolen from the makers; for they were in blank and yet they were for a given number of points. That meant that, although the wholesaler or retailer had drawn them to cover some specific purchase, he had left the seller’s name blank. That Tapen or his unknown confederate should be able-before the makers delivered them to the sellers — to steal a series of such cheques which were not prepared in advance of the transactions, is fantastic. If stolen, they must have stolen from the sellers, and even though we were to assume that it was customary to pay in cheques which had no payee, it would be highly unreasonable to suppose that the sellers, finding their cheques stolen, would not at once have stopped payment at the bank on which they were drawn; or, if they did not know what the bank was, would not have notified the buyers. For these reasons the guilt of Merlis and the Center Company upon the “Information” was as clearly proved as that of the Murray Company and Hermann on the “Subsidy Indictment.”
There remains only the conspiracy indictment, our discussion of which will also dispose of Hermann’s and the Murray Company’s guilt under the “Information” and Merlis’s guilt under the “Subsidy Indictment.” It was an irrefragable inference that each man must have known what the other was doing. Each was an equal owner in both companies, together they were the only owners. While it is true that the Center Company did not get all its meat from the Murray Company, it got by far the greater part; and, conversely, while the Murray Company did sell meat to others than the Center Company, it sold by far the greater part to that company; to all intents the men were doing a single business as butchers and wholesalers. The butchering part of the business had been going on for months by a series of frauds; and when these were eventually discovered, and it became necessary to cover them, the selling part of the business stepped in with a complementary series of frauds by which the first series could be, and for a time in fact were, concealed. Yet we are asked to say that this seamless web was woven in part by one hand and for the rest by another
The next point is that the conviction for conspiracy must fail under the doctrine which we accepted in United States v. Zeuli,
The now almost inevitable challenge of the fairness of the prosecution’s summing up has little foundation. Part of it appears to rest on the theory that if the inferences are untenable which a prosecutor asks a jury to make, the verdict cannot stand: a strange conception. Provided the prosecutor confines “himself to the evidence and makes an argument which he believes to be valid, it would be an utterly impossible standard to require the judge to check its cogency; and it would be the clearest invasion of the jury’s function. It is true that in his peroration the prosecutor in the case at bar seems in substance to have asked the jury, if they had doubts about the defendants’ guilt, to consider the effect upon the public of a verdict of not guilty. That he plainly should not have
The chief complaint of the charge is that the judge did not read or explain to the jury that regulation which required the petitions to be supported by statements made to the O.P.A. and by ration cheques; and that other regulation which forbade the purchase of forged ration cheques. It is true that the Third Circuit in three decisions,
Be that as it may, the present appeal does not require us to decide the point, and, arguendo, we will assume that it was necessary for the judge to leave the case to the jury in the form of those general propositions of law which they were to apply. He begun his charge with the “Subsidy Indictment” and read to them the statute,
The only other point that requires discussion is the judge’s refusal to grant the defendants’ fifteenth request to charge which in substance was that, if Hermann had in good faith filed the subsidy petitions on the advice of counsel, he was guiltless. The judge gave as his reason that there was no evidence that Hermann had acted on any legal advice, in which we may for argument assume that he was wrong. However, he had just charged the jury at length that the mere signing of the cheques was not a crime; that the person who signed them— Hermann — must have known them to be untrue and have signed them to accomplish some unlawful end; and that intent was always crucial. “Once the judge has made an accurate and correct charge, the extent of its amplification must rest largely in his discretion.”
There are other objections, but they are trivial,' and we shall not discuss them. The accused had a fair trial; their guilt was manifest; their offense struck at the nation’s protection in its hour of peril; if punishment is ever justified,' the sentences they received were just. Their sordid contribution toward breaking down the collective effort to conserve our national resources, was morally removed only a step from giving aid and comfort to the enemies of their country.
Convictions affirmed.
2 Cir., 137 F.2d 845.
Heike v. United States, 227 U.S. 131, 144, 33 S.Ct. 226, 57 L.Ed. 450; United States v. Uram, 2 Cir., 148 F.2d 187.
United States v. Levy, 3 Cir., 153 F. 2d 995; United States v. Noble. 3 Cir., 155 F.2d 315; United States v. Pincourt, 3 Cir., 159 F.2d 917.
9 Cir., 156 F.2d 525.
Title 18, U.S.C.A. § 80.
Title 50 U.S.C.A. War Appendix, § 633.
United States v. Bayer, 330 U.S. 67 S.Ct. 1394.