UNITED STATES of America, Plaintiff-Appellee, v. Frank W. CATHEY, Defendant-Appellant.
No. 77-5753.
United States Court of Appeals, Fifth Circuit.
March 2, 1979.
591 F.2d 268
Jack V. Eskenazi, U. S. Atty., Marsha L. Lyons, Asst. U. S. Atty., Miami, Fla., M. Carr Ferguson, Asst. Atty. Gen., Gilbert Andrews, Chief, App. Section, Robert E. Lindsay, Jared J. Scharf, Attys., James A. Bruton, Tax Division, Dept. of Just., Washington, D. C., for plaintiff-appellee.
Before BROWN, Chief Judge, and GODBOLD and FAY, Circuit Judges.
GODBOLD, Circuit Judge:
Frank Cathey was convicted by a jury on three counts of willful attempt to evade or defeat his federal income tax due for the years 1970, 1971 and 1972, in violation of
I. Government misconduct before the grand jury
A. False statements
While testifying before the grand jury, special agent Derry of the IRS made three statements which defendant says were false, known to the government to be false, and material. Under U. S. v. Basurto, 497 F.2d 781 (CA9, 1974), defendant urges that the government had a constitutional obligation to inform court, counsel and grand jury about the statements and that its failure to do so requires dismissal of the indictment.1
In Basurto, the Ninth Circuit held that the Due Process Clause of the
Appellant‘s Basurto argument fails in a second respect. In the sense that they were about collateral matters, Derry‘s alleged misstatements were not material. The statements in question revolve around the agent‘s testimony concerning a recorded interview he had conducted with Cathey.5 Derry testified that the defendant‘s “only explanation” why his bank accounts “far exceeded his gross income from all known sources” was that he had accumulated a large sum of money from dealing in currency exchange while stationed with the Air Force in Turkey. The transcript of the interview indicates that Cathey presented several explanations for the accumulated money in his bank accounts. Defendant claims that the statement limiting his explanation to currency dealings was material because in a tax fraud case based on net worth computations6 the government must investigate and negate taxpayer explana
The second statement made by agent Derry that may have been misleading, because it was unresponsive, was in answer to a grand juror‘s question concerning the defendant‘s prior military conviction.
Juror: Was that for the currency dealings he was convicted?
Witness: He had several things going, currency exchange was part of it.
The government concedes that the defendant was not convicted for currency exchange violations but rather military post-exchange violations. We conclude, however, that the above statement is not material to an element of a
The final statement in question occurred while Derry was testifying about Cathey‘s military career. He testified that he asked the defendant whether he was retired from the Air Force and recounted that Cathey said “No“. In fact, Derry had asked the defendant whether he was retired from the Army. A “no” response to the Army question by the defendant was truthful, while a “no” response to the Air Force question was misleading. According to defendant, the grand jury may have inferred that he was trying to lead Derry away from discovery of his court-martial. Assuming that such an inference was drawn by the grand jury, it was not material to an element of the offense. Moreover, because Cathey concedes that the grand jury was entitled to be informed of his court-martial, any increased prejudice caused by the manner of informing the grand jury must be slight and certainly not of constitutional proportions.
Thus we agree with the district court‘s conclusion that dismissal of the indictment is not justified, because perjury was not proved and because the statements lacked materiality to the offense. But the presentation of the case to the grand jury is hardly commendable. Why the prosecutor elected to use Derry‘s hearsay account of his interview with Cathey rather than use the verbatim transcript of the interview we do not know. See note 5, supra. Use of the transcript would have avoided the problems discussed in this portion of our opinion.
B. Improper remark
During the course of his grand jury testimony, Derry remarked that the defendant was “caught with his hand in the cookie jar.” Inflammatory remarks made by a prosecutor justify the dismissal of an indictment if the improper remarks so biased the grand jurors that their votes were based on their bias. U. S. v. Polizzi, 500 F.2d 856, 887-88 (CA9, 1974), cert. denied, 419 U.S. 1120 (1975); U. S. v. Bruzgo, 373 F.2d 383, 386-87 (CA3, 1969).8 We agree with the district court that the remark was needless and improper. We also agree with the district court that the remark does not rise to constitutional proportions.
Agent Derry testified at the trial. After he testified defendant‘s counsel requested all Jencks Act material.
III. Admission of 16-year-old military conviction
The defendant testified, and on cross-examination the prosecution impeached his credibility by eliciting the fact of his prior military conviction for larceny.9 The defendant has raised several objections to this use of his prior military conviction.10 Because we conclude that under
While stationed in Turkey, Cathey was convicted by general court-martial of five specifications of theft of Air Force Exchange merchandise.12 He was sentenced to two years hard labor, was released from military confinement June 31, 1961, and called to testify in October 1977. The prior conviction was therefore a little more than 16 years old when offered into evidence as measured by the standards of
Evidence of a conviction under this rule is not admissible if a period of more than ten years has elapsed . . . unless the court determines, in the interests of justice, that the probative value of the conviction supported by specific facts and circumstances substantially outweighs its prejudicial effect.
Before analyzing the factors that go into the balancing of the probative value against the prejudicial effect of a prior conviction under
The prior convictions of a witness may only be used by the jury to evaluate the witness‘s credibility. In spite of the legal rule limiting the use of prior conviction evidence to impeachment purposes, when the witness is the accused the evidence is subject to improper use. U. S. v. Martinez, 555 F.2d 1273, 1275 (CA5, 1977) (quoting U. S. v. Garber, 471 F.2d 212, 215 (CA5, 1972)); see Mills v. Estelle, supra at 120. The jury may misuse the evidence by considering the defendant a person of criminal tendencies and, therefore, more likely to have committed the crime for which he is being tried, Mills v. Estelle, supra at 120, or if the prior conviction is similar to the new charges, the jury may misuse the prior conviction as evidence of guilt, U. S. v. Martinez, supra at 1275, or the jury may just be more willing to convict a person who already has been convicted for a different crime, Mills v. Estelle, supra at 120.15
We now turn to the probative value portion of
In U. S. v. Cohen, supra, we held that the district judge did not abuse his discretion when he allowed the prosecution to impeach the defendant with a 13-year-old conviction for mail fraud. Id. at 785. However, in U. S. v. Bibbs, supra at 1170, decided after Cohen, we recognized as an essential element of
In the context of admissibility of over-age convictions exceptional circumstances includes, though it is not limited to, the need of the party offering the evidence to use it. This concept of necessity is relevant to the district judge‘s evaluation of the probative value of the conviction. Our
Id. at 914 (footnote and citations omitted). Therefore, when a party wishes to use an over-age conviction, the trial judge must consider whether the witness already has been impeached, and if so, the probative value of the prior conviction decreases accordingly.Probity in this context is not an absolute; its value must be determined with regard to the extent to which the defendant‘s unlawful intent is established by other evidence, stipulation, or inference. It is the incremental probity of the evidence that is to be balanced against its potential for undue prejudice. Thus, if the Government has a strong case on the intent issue, the extrinsic offense may add little and consequently will be excluded more readily.
In this case nothing suggests exceptional circumstances justifying the use of Cathey‘s prior conviction. The defendant‘s credibility had already been well impeached by the government‘s cross-examination during which he had been caught in various contradictions and numerous misstatements. There was little need to add the icing of his military conviction. The district court mentioned that on direct examination Cathey had testified to his accumulation of a cash hoard during his military career, and, of course, the court-martial for stealing occurred during his military service. Possibly the court considered the conviction as bearing on the credibility of defendant‘s claim that he had accumulated a cash hoard. If anything, the conviction of stealing at the time Cathey claimed he was accumulating his cash hoard, bolsters his credibility with respect to a hoard rather than impeaches it. Absent some additional factor justifying the use of the prior conviction, there is no basis for concluding that it falls within the exceptional circumstances caveat to the general prohibition against the use of a conviction more than 10 years old.
The government says the error was harmless. We cannot say that it did not influence the jury or that it had very slight effect. Kotteakos v. U. S., 328 U.S. 750 (1946). The government argues that Cathey already had been caught in so many falsehoods on cross-examination that the additional blow could not have hurt. We agree that he had been well impeached, and, because he had, there was no need for the prosecution to use the 16-year-old conviction. The right to use evidence of prior convictions to impeach is tempered by the need to use it. It would be anomalous indeed to conclude that the less the prosecutor needs the evidence the freer he is to use it.
REVERSED.
FAY, Circuit Judge, dissenting:
This is a weak dissent in a very close case.1 I agree wholeheartedly with Parts I and II of the majority opinion. While agreeing with those principles of law set forth in Part III, I respectfully dissent from the conclusion.2
A review of the record convinces me that the able trial judge complied with the announced test as to the admissibility of the defendant‘s prior military conviction for larceny and did not abuse his discretion. Concluding that such evidence was admissible for impeachment purposes, I would affirm the convictions.
Certainly there is a “presumption against the use of an over-age conviction.”
The majority finds an abuse of discretion since the “defendant‘s credibility had already been well impeached.” It classifies the evidence of the military conviction as unnecessary “icing“. My crystal ball is not that clear nor am I willing to play Monday morning quarterback in such a close call.
Notes
Id. at 1200 n.1.To establish unreported income under the net worth method, the government must establish the taxpayer‘s net worth at the beginning of the tax year in question. Then the government must establish the taxpayer‘s net worth at the close of the year. It subtracts the former figure from the latter to show the taxpayer‘s increase in net worth for the year in question. This figure is further adjusted by (1) adding to it the taxpayer‘s non-deductible personal expenditures for the year and (2) subtracting from it the taxpayer‘s allowable deductions.