United States v. George F. Brown

America, UNITED STATES

Plaintiff-Appellee, BROWN, George Defendant-Appellant. F.

No. 77-5607. of Appeals, United States Court Fifth Circuit. June Rehearing Rehearing En Banc 10, 1978. Aug. Denied McKinnis,

E. Drew Rouge, La., Baton defendant-appellant. Beckner,

Donald L. Atty., U. S. Darrell D. White, Atty., Asst. U. S. Baton Rouge, La., plaintiff-appellee. to run *, Judge, concurrently. appel- and sentences The Senior SKELTON Before RUBIN, appealed lant then to this court. We af- Judges.. Circuit and FAY firm, subject part to a the remand of of the Judge. SKELTON, Senior instructions, to case the trial court with as Brown, was in- George F. appellant, set forth below. The Jury Baton Grand by a Federal dicted pre-trial The filed motions for $15,000 receiving from for Rouge, Louisiana to discovery and dismiss the indictment $15,- and Brewing Company Dixie complained which he of the indictment be- Company in Brewing Falstaff from evidence, hearsay on ing based and also passage with the 1975, in connection grand alleging integrity jury that of the fa- Legislature by the Louisiana legislation impaired by had been the fol- proceedings breweries, to failing report and to vorable lowing incidents and circumstances: returns, on income tax his payments (1) indicting grand Failure to advise 7206(1).1 of 26 U.S.C. violation § all in jury Gregg given the witness had Leg- of the was not a member Appellant testimony appear- inconsistent in his two islature, Executive Director was the but grand jury ances before earlier in New and, Louisiana Industry League of the Beer Orleans; legis- such, position a influence as was in (2) Failure to grand jury advise pay- These to breweries. relative lation the witnesses whose statements had been by a investigated Federal were first ments summarized before them had been immu- in connection New Orleans Jury in Grand nized; (not involved indictment conspiracy awith (3) That the summarized witnesses’ against appellant returned appeal) in this support statements did not the facts al- Later, an Government sent others. and indictment, and; leged in Jury in Baton a Federal Grand before agent (4) That no evidence substantial evidence summarized Rouge who presented grand jury to warrant New Jury in Orle- presented to the Grand indictment. appeared witness before No other ans. The Reciprocal court issued a Uniform Thus, Jury. the indict- Grand Rouge Baton Discovery Order but denied the motion to solely on instant case based ment in the dismiss the indictment. is of the cir- testimony, which one hearsay complained by appellant cumstances argument Appellant’s in appeal. this it dictment should be dismissed because is unpersuasive. is jury hearsay tried based on appellant was before The nature, grand By very jury process two its involving the is indictment two-count guilty adversary proceeding. on both Its function and was found payments, merely probable is to determine if there is jury. He was sentenced counts being cause which warrants defendant’s each count to a term of three court on A defendant has no he confined in bound over trial. be years on condition right with sus- the Government days, jail-type institution sentence, present pro all available evidence remainder of the pension of the ceeding. grand begin- jury proceeding is by probation years for 3 be followed confinement, protect- one-sided affair. The defendant is release from ning with his * penalties perjury, Judge made under and which United States Court of the Senior Claims, by designation. sitting as he does not believe to true correct matter; every guilty . . shall be . U.S.C., 7206(1) provides: 1. 26 and, thereof, felony upon of a conviction shall Fraud and false statements “§ $5,000, imprisoned than or be fined not more Any person who— both, years, together or not more than 3 with penalties perjury.— (1) under Declaration prosecution. Aug. c. the costs of return, willfully and subscribes makes 68A Stat. 852.” document, statement, contains other or is a written declaration that is verified when, at

ed from such one-sidedness The complaint of appellant merits, he is “accorded the failure to advise the grand trial on the full indicting jury witness Gregg had protections of the Fifth and Fourteenth inconsist ent statements to grand jury, another “permitted expose Amendments” that witnesses whose statements were sum upon bearing facts all of the marized for the grand jury grant had been Chanen, United States v. innocence.” 549 immunity, ed bear on the credibility of such 1977). (9 Cir. F.2d witnesses and is without merit. The Cruz, in United States v. Our decision Government is under no duty present to 1973) (5 dispositive 408 Cir. of F.2d grand jury evidence bearing on the credi In case we held argument. that an bility of witnesses. This very question was on hearsay indictment based evidence is decided adversely to appellant’s contention valid, saying: by the Ninth Circuit Court of Appeals in Hearsay Jury “Grand Chanen, United States v. 549 F.2d (9 1977) Cir. held; which the court appellants The contend that their “In Loraine v. States, jury grand indictment was invalid be (9th Cir.), denied, cert. 393 U.S. it was based on the hearsay cause testi 89 S.Ct. (1968), L.Ed.2d 270 mony investigating one FBI of officer defendant moved to dismiss the indict on direct testimony rather than of infor grounds ment on the prosecutor, in mant-witnesses whom the presentation grand his to the jury, wilful testify. have summoned to could In Cos ly suppressed evidence that would under tello v. United mine the credibility of three crucial wit Court grand nesses before the jury. Apparent rejected considered and the contention ly, one witness had a criminal record and an exclusively indictment based on was then under indictment in several oth hearsay is constitutionally inval cases; er another witness had been reasoning id. This been has followed on charged embezzlement; with the last had many See, g., occasions this court. e. enjoined been from dealing in securities. Bird, (5th United States v. F.2d 1023 We held that 1972); Klaes, Cir. States ‘the trial court did not err in refusing (5th 1972); F.2d 1375 to invalidate a federal indictment be- Howard, (5th 1970), 433 F.2d 1 cause the Government did not produce denied, cert. grand before the jury all evidence in its (1971).” L.Ed.2d 819 possession tending to undermine the

credibility of the witnesses appearing before that body. Loraine was accord- the presentation “While of hearsay tes- protections ed the full of the Fifth and timony an investigating officer in lieu Amendments, Fourteenth when, at the readily testimony by available direct merits, trial on the he permitted was byis a preferred pro- witnesses no means expose all the bearing facts upon his cedure, it is neither unconstitutional nor ” guilt or innocence.’ inherently wrong. In the absence of case, In the appellant instant was fur- showing some integrity of grand nished a list witnesses, of all the except jury proceedings impaired, has been Gregg, who had been granted immunity, indictment even if exclusively based on two months before the trial. There was testimony will overturned on some evidence appellant knew before appeal.” 478 F.2d 410-411. began trial Gregg grant- had been We hold that trial court did not abuse event, ed immunity. In appellant knew his in denying appellant’s discretion Motion of his immunity during the trial and thor- though Dismiss the indictment even oughly cross-examined him with reference exclusively hearsay was based evidence. Gregg’s prior it. As to inconsistent appellant complains The statements, every opportuni- had appellant and, fact, jury present them refusing grant court erred mistrial ty that he has not shown Appellant so. did beginning or a at the continuance foregoing incidents. by the prejudiced was on the fact that he was not based phase the case. in this no error We find transcript testimony furnished protections the full appellant prospective that of certain Government wit Fourteenth Amendments of the Fifth grand days before the until jury nesses two develop at the trial allowed to he was when transcript Even before trial. if the bearing on his the facts all of earlier, to him should been furnished innocence. he preju not shown that that the sum arguments Appellant’s thereby. diced This is true since especially the witnesses did not marized statements the transcript the Government did use indictment, alleged support the facts at the trial. was no substantial and that above, As stated the court issued grand jury to warrant presented Reciprocal Discovery prior Uniform Order indictment, In United unpersuasive. are beginning of trial. This order Cruz, supra, we v. held: States compelled disclosure “all evi- approach, ap “Taking a different meaning dence within the v. Brady their argue that indictments pellants grand jury did Maryland, because 373 were invalid U.S. 83 S.Ct. 10 evidence, probative it any have before (1963) Maryland, L.Ed.2d 215 v. Giles direct, which to hearsay upon or either 386 87 U.S. S.Ct. 17 L.Ed.2d 737 However, the ma indictments. base the (1967).” Appellant sought to supplement squarely in Costello also jority opinion requesting order written motion that appellate that rejected the contention he be with: furnished sufficiency evi may review courts The “3. materials in the contained an indictment. 350 supporting dence files of the Internal Revenue Service rel- 363, 76 at The 408-409. U.S. at S.Ct. investigation ative to its of defendant concurring on the appellants’ reliance years the calendar 1974 and 1975 which Mr. Justice Burton in Costello opinion of or negate tend to pre-Costello opinion in the dicta receipt unreported income the de- States, Cir., court, 5 Friscia v. United this alleged denied, fendant the amounts in the 977, 980, 289 cert. U.S. 63 F.2d request 53 is this are S.Ct. indictment. Included in not review the suffi misplaced. We will analy- to any materials relative net worth evidence, ciency any, supporting if of the sis by Internal Revenue Service and in this grand jury indictments case. reports agents its as to defendant’s F.2d v. United 436 586 Cohen See spending habits. denied, 403 Cir.), cert. 91 (5th Any reflecting “4. name materials (1971); 29 L.Ed.2d 684 S.Ct. of, any and current address and/or state- Gower, (5th Cir.), F.2d 187 v. States ments of Internal Revenue Service denied, cert. S.Ct. investigation connection with its of de- (1971).” 478 408 at 412. F.2d returns, fendant’s 1974-1975 income tax Calandra, also See (1) either or be- put who called 344-345, L.Ed.2d 561 Jury (2) fore the Grand was called Boerner, (1974); United State Jury will not be before Grand but (5 1975); and States called as witness the trial.” (5 Newcomb, 488 F.2d 192-193 1974). The answered motion this and other information urging we not review the suffi-

Accordingly, will sought “beyond scope of F.R.Cr.P. grand before the ciency of the evidence already dis- Rule 16 or has been ordered the indictment was based. jury on which This motion was denied “The closed." test is whether or not the money urged substantially later Appellant court. together received with unfettered Dismiss, in a Motion to the same matters disposition control over the of that mon- appellant says The which was also denied. ey.” denying court erred in these mo- appellant object The did not to this charge. sought the material he would tions because The Government says charge com- “clean bill of him a health.” He plies with the law and that the I.R.S. audit throughout the trial contended was not material or guilt relevant Brewing Falstaff and Dixie Companies that punishment. We cannot say in the present payments made the him never intended state of the record whether or not this is he was to receive economic benefit true, because we do not know so what is con- money paid, from the and that in fact he no economic tained in received benefit therefrom.2 the audit. Evidence that is “ma- The Government refused to appel- furnish terial either or to punishment” any part lant of the Internal Revenue Ser- should be disclosed under “Brady rule.’’ audit, saying vice it was not relevant Illinois, See Moore v. was, therefore, and the not enti- (1972). L.Ed.2d 706 The test tled to it. for materiality of such evidence is whether appeal Government contends on this “might the evidence have affected the out- substantial omission of income from come of the trial.” United States v. appellant his tax return constituted 110, 2392, 427 U.S. 97 at 96 2400, S.Ct. 49 a “material matter” within the contem (1976). L.Ed.2d 342 Since the contents of plation U.S.C., 7206, citing of 26 § Hoover the audit were not revealed to the trial States, (5 1966), United 358 F.2d 87 Cir. judge, there was no way that he could prosecution and that in a under the statute determine whether it contained exculpatory deficiency lack a tax is neither essen evidence that was material to guilt or to relevant, citing tial nor United States v. punishment in way might have af- Jernigan, 471, (5 1969), 473 fected the outcome of the trial. The 927, 262, cert. denied 396 U.S. 90 S.Ct. 24 argues Government that the appellant’s net 225, Shepps L.Ed.2d and States, analysis worth spending and habits infor- (5 1968), 395 F.2d 749 Cir. cert. denied 393 mation would not negated have or tended 925, 89 U.S. S.Ct. 21 L.Ed.2d 261. receipt to of unreported income.3 Supreme Court and this court have question This should have been determined held: by the trial only court after he had exam- “ . . power . it is the dispose ined and considered the contents of the income and the exercise of power audit. It is obvious that neither the trial that determines whether taxable income court nor this court can decide cases in a Helvering has been received. v. Horst vacuum, pass nor on facts that are not in (1940) 311 61 S.Ct. 85 L.Ed. the record. 75; Scofield, Floyd 5th Cir. 193 F.2d 594.” Sammons v. United States We conclude that this case cannot be

(5th 1970) 433 F.2d 728 at 732. properly disposed of until the contents of Bowers, also See Corless v. 50 the audit I.R.S. are revealed to the trial S.Ct. and Rutkin v. court in an in camera inspection and he has 96 made findings and conclusions as to wheth- (1952). L.Ed. 833 er the audit contains exculpatory evidence case,

In the that is instant the trial court material to the pun- or to the charged jury: appellant, ishment of might and which testify, appellant 2. The did not and is there no 3. The Government admits that such evidence who, anyone, might if exculpatory received an economic prosecution be in a under 26 payments. U.S.C., benefit from attempted 7201 for tax evasion. part ground This to the of the trial. available outcome affected to the trial court we distinguish is remanded new trial. But must the case the trial We affirm purpose. prosecu- for this between such dereliction and of the case. to the rest as judgment court’s merely tor’s failure to meet the constitu- duty, interpreted Brady, supra, tional as in such in is make court directed The trial developed Agurs, and further in supra. as audit of I.R.S. examination camera produce If prosecution failed tax records appellant’s exculpatory specifically re- court and con- finds in the event defendant, quested by the the Constitution exculpatory contains the audit cludes that new “if requires a the omitted evi- guilt, is material evidence that dence creates reasonable doubt did appellant, and which punishment of Agurs, supra, the outcome not otherwise exist.” might have affected trial, is and directed court authorized at U.S. at S.Ct. L.Ed.2d at in the case. action appropriate prosecutor respond take 355. If the fails to to a gives specific request, prose- one that “the hand, finds and if court On the other exactly cutor notice of what defense not contain that the audit does concludes Agurs, desire[s],” supra, U.S. at evidence, he is authorized such 2398-2399, S.Ct. at 49 L.Ed.2d at “it is on the man- to enter order and directed prosecutor reasonable to to re- judgment conviction affirming the date spond by furnishing either the information trial court. and sentence of by submitting problem to the trial part REMANDED AFFIRMED judge. prosecutor When the receives a spe- Trial with instructions. part Court request, cific and relevant the failure to ever, response seldom, make if excus- RUBIN, Judge, Circuit con- ALVIN B. supra, able.” at curring dissenting part, part: Agurs at 351. note, the did myAs brethren defendant not, however, every does hold that for, not to receive not ask and was entitled default, inexcusable, requires however a cases, in rules criminal discovery under the Weighed by non-specific new trial. the re- F.R.Cr.Proc., and Brady Mary- Rule standard, quest Agurs, supra, obviously land, 1963, 83, 83 does not a new here for rea- in interpreted as L.Ed.2d sons I will discuss below. If we assume Agurs, request gave prosecutor that this the notice govern- in the everything desired, what exactly the defense how- sought He that material that ment’s files. ever, a new necessity the for trial has not negate receipt the of unre- would “tend demonstrated, and, been reasons for set the in ported income defendant the below, forth the procedure mandated the (Re- alleged amounts in the indictment.” opinion question appears to determine that request quest 3) vague This is less than a to me to be ill-advised. materials, but merely for hardly request a specific particu- as as a for return question Let us whether the was lar As what embraced in item. sense; requests specific were in the i. Agurs in full in the text Request set forth e., requested exists that the material and conjecture, we must for opinion, the prosecutor request exactly that the told the convey any specific fail words used what assume that the defense desired. I me; I cannot determine wheth- meaning to investigation, there a was net worth seeking names of er defendant of the kind customar- annual balance sheets witnesses, reflecting materials names of ily investigations in exist prepared for witnesses, or Internal Revenue Service they years may 1974 and and “statements,” those be. whatever for (a) in net worth each show: no increase reported specifical- year in income or produce material not reflected

The failure income; (b) that is in non some increase in net ly requested by the defense fact taxable might reported in reflected income or exist that would worth not achieve the end of income, exonerating but an increase non-taxable defendant. Much travail $15,000 saved, less than would have amounting substantially been and likely nothing government, lost to the (c) prosecutor similar increases in net worth had the year; each $15,000. either Analyses produced government had, what the equal to or in excess Alabama, (a) (b) Cannon mentioned in and would kind responded by indicating that there is unreported tend to indicate no nature of the material in his possession in a net worth in- income that resulted asking that the crease, request be they disprove specific would not made but so that he could duty. determine his that was receipt of income taxable and dis- Su- preme Court said in supra, purposes that did not result in bursed an 96 S.Ct. at L.Ed.2d at increase net worth. prudent prosecutor will resolve “[T]he analysis The value of the net worth lies in questions doubtful in favor of disclosure.” proving positive, negative: not the done, But this was not and the failure in net increase worth not accounted for thus to cure what appears inescapably leads to the conclusion that to be a necessary lack of the particularity in there was income to enhance the taxpayer’s request should not occasion new trial. worth, but absence of net worth in- No evidence is admissible unless it is rele- crease does not have the same force in vant, Rule Federal Rules Evidence, proving reported. all income was having that means “evidence any tend- The evidence here is overwhelming that ency to make the existence of fact that $15,000 put in cash was in the defendant’s is of consequence to the determination of year. hands each The defendant virtually probable the action more than it would be admits it. The defense simply without evidence.” Rule id. See money was income to him and he was also Evidence, McCormick on 185 at merely a courier who carried bag. Of (2d If, 1972). however, Ed. prosecutor course, know, my we do not as brethren say, fails, response specific even request, might what the materials requested to adduce evidentiary request- receipt $15,000 would ed, a new trial is automatically granted: unreported year. income each Let us con- the test is not whether material was jecture: $15,000 if the defendant received admissible, merely relevant, that is not but, year spent each personal pur- material, whether it “is or indeed [whether] poses, the result would not be reflected in a substantial basis for claiming materiality his net worth year. If, at the end of either exists.” Agurs, v. supra, States example, gambled for part he all or of it at 96 S.Ct. at 49 L.Ed.2d at away, it, spent discretion, or at his own to 351. Because the holding actual Agurs officials, public benefit expended or it on deals duty produce with the to personal extravagances, a net worth analy- evidence in accordance with the “defend- showing sis he unreported that had no in- ant’s right to a fair trial mandated the worth, crease in net unreported or an in- Due Process Clause of the Fifth Amend- crease in net worth to a sum less than Constitution,” id., ment to the 427 U.S. at $15,000 per would not se his receipt at at we $15,000 year of each as income. The audit automatically cannot apply its standard might demonstrate fiscal rectitude in other that, here: but we now know cases, in such regards, but there were character witnesses granted a new trial must be “if the omitted testify aplenty to general defendant’s evidence creates a reasonable doubt impeccability. exist, did not otherwise . . . .” 427 request was not for the balance 96 S.Ct. at 49 L.Ed.2d at sheets for 1974 or 1975. It was not for Presumably, 355. the test is stringent less sought income reconstructions. It put to on request if there is a specific for material, prosecutor the the evaluating exists, task of what the material in fact and is pro- not Brady, supra, or in nothing duction of which results in a new trial only But duced. 16 makes even the if “the omitted evidence creates a supra, in Rule reasona- every item of doubt not produce ble that does otherwise exist.” to willful failure ipso Agurs, supra, facto Therefore, 96 S.Ct. 2401. relevant material requested directs a search for two different kinds of for reversal. ground and adopts material the same standard Anderson, 5 Cir. v. In United States both. the 1347, Judge Hill discusses F.2d Moreover, It is the mandate of my situations. brethren failure-to-disclose various repeat requires judge that excellent sum- trial to examine unnecessary to docu- assume, however, that ments in camera. A net Let me investiga- worth mary here. produces specific prodigious quantities in the sense that tion requests pa- were appears examining the task of it is Agurs, supra, defines per; that term. It substantial. that, Agurs Assuming industry, every rationale the utmost of not implicit be to judge capable assimilating trial prosecution’s if failure was inex- even data, necessarily require essentially a cusable, is based this does account- showing ing concepts.1 important, some More trial. There must be even after new trial, might judge evidence does know all of the suppressed possible the trial. Presum- theories of a case or all the ways the outcome of affected might be the one applied party’s to be would data in hands be used ably, the test prosecutor if the fails when combined with data available applies test that to same request discovery may insignificant other side. What seem comply with to to judge may Federal be of great potential with Rule value to made in accordance Procedure; advocate; it must be once he knows what the Criminal facts Rules of are, lawyer may prejudiced the defendant be able demonstrate shown United States is, what is apparently unimportant nondisclosure. 764; Ross, fact, material. The converse is also Cir. true: F.2d James, argue point, a chance the pros- States Saitta, 436; may ap- ecutor be able to show that what respect, significant I agree pears probative In this is of little real F.2d brethren worth. In the interests of due adopted my process, criterion with the opportunity it must be of both the defendant prejudice: to show as sufficient “might may have af- the evidence helpful evaluate shown (as to him well as to confront the trial.” witnesses fected the outcome him), against as well as in the interest does not confine itself But the mandate affording prosecutor a chance brief judge to search for directing case, argue its I no would more to determine requested, items specific in camera duties of trial courts than those so, exist, and, prej- if whether they whether indispensable. that are non-production. from their resulted udice Therefore, “exculpatory general simply search for I would affirm the con- directs It guilt, yet viction. that is material to The defendant file a mo- appellant, post-conviction and which tion for punishment relief under Section may pursue of the 2255. He might have affected outcome this motion with such specific discovery items devices as are trial.” It thus embraces both available.2 The focused, material, may non-pro- inquiry directly then be more general son, 1969, here, experienced happens trial 1. As it this States, respect; 281; judge capabilities has unusual this Ferrara 5 Cir. actually accounting degree 861; he has a United States ex rel. Seals attending law Wiman, as an accountant while worked 304 F.2d 53. See also school. Governing Rules Section 2255 U.S.C. [28 Proceedings, Sept. Rule Act § 2255] may judge in allow the The trial his discretion 2. 94-426, P.L. 90 Stat. 1334. discovery applicable of those devices use proceedings. v. Nel- criminal Harris civil and specific, and the subjects more defendant, be viewed not mere- Each side will also ly by the court. have a be heard

chance to issues. Where done, and process been due afford- sides, ed not in camera open both but in court, judge may the trial determine wheth- be new

er should trial. there reasons, respectfully I For these DIS- the remand and SENT from the mandate to Duke, judge. Tex., David Arlington, plain-

tiff-appellant. Mighell, Atty.,

Kenneth J. William Johnson, Jr., L. Asst. Atty., Fort Worth, Tex., for defendant-appellee. VALLANCE, Winfred Dan MORGAN, CLARK, Before TJOF- Plaintiff-Appellant, LAT, Judges. Circuit PER CURIAM: America, UNITED STATES plaintiff, Vallanee, Winfred Dan ap- Defendant-Appellee. peals the district court’s dismissal No. 78-1051 Federal Tort Claims Act suit [F.T.C.A.]1 Summary Calendar.* for failure to state a upon claim relief can be Appeals, granted. United States Court We affirm. Fifth Circuit. April 1974, In while serving in active duty as a officer, United States naval Val- June lance entered the Navy Regional Medical Oakland,

Center California, diagnosis of head pains. person- Navy performed nel arteriogram, the results of which they termed normal. August In 1976,Vallanee returned hospital with pain. Hospital increased personnel discov- ered and removed a large tumor. Alleged- ly, April tumor, test results showed the but the results had been misread. Vallanee charged hospital personnel discovered the mistake after in April, he left but did not notify him. Vallanee contends that the delay in treatment increased degree

permanent damage he suffered.

In Feres v. United the Su- * 18, Cir.; Enterprises, see Isbell Rule seq. Inc. v. (1976). et 1. 28 U.S.C.A. Casualty al., Cir., Citizens Co. of New York et I. Part

Case Details

Case Name: United States v. George F. Brown

Court Name: Court of Appeals for the Fifth Circuit

Date Published: Aug 10, 1978

Citation: 574 F.2d 1274

Docket Number: 77-5607

Court Abbreviation: 5th Cir.