Sandroff v. United States

• Decision Date: 10 December 1946
• Docket Number: No. 10051,10052.,10051
• Citation: 158 F.2d 623
• Parties: SANDROFF v. UNITED STATES. THOMAS PAPER STOCK CO. v. SAME.
• Court: U.S. Court of Appeals — Sixth Circuit

158 F.2d 623 (1946)

SANDROFF v. UNITED STATES.

THOMAS PAPER STOCK CO. v. SAME.

Nos. 10051, 10052.

Circuit Court of Appeals, Sixth Circuit.

December 10, 1946.

Homer Cummings, of Washington, D. C. (E. Cyril Bevan, of Detroit, Mich., and Jack H. Oppenheim, of Chicago, Ill., on the brief), for appellants.

Helen M. Bloedorn and Samuel Rosenwein, both of Washington, D. C. (John C. Lehr and Francis X. Norris, both of Detroit, Mich., and David London and Albert Dreyer, both of Washington, D. C., on the brief), for appellee.

Before HICKS, ALLEN and MARTIN, Circuit Judges.

MARTIN, Circuit Judge.

Alvin E. Sandroff and the Thomas Paper Stock Company, a corporation of which he was president, have appealed from judgments of conviction on the verdict of a jury and from sentences of imprisonment for two years and a fine of $10,000 imposed upon the individual appellant, and a fine of $10,000 imposed upon the corporation. The indictment upon which conviction rested charged the appellants and three other persons who were not indicted, namely, Charles Ginns, his son Jack Ginns, Jacob Moss, and other persons unknown, with an unlawful conspiracy to violate paragraph (b) of Section 205 of the Emergency Price Control Act of 1942, as amended, Public Laws 421 and 729 of the 77th Congress, 50 U.S.C.A.Appendix, § 925(b), and Section 1347.10 of Maximum Price Regulation No. 30 as amended (7 Fed. Register 9732; 8 Fed. Register 3845, 6109, 7199, 8350), issued by the Price Administrator of the Office of Price Administration, pursuant to lawful authority vested in him by the Emergency Price Control Act, as amended, and by Executive Order No. 9250, 50 U.S.C.A. Appendix, § 901 note, issued by the President of the United States.

The statute involved, Section 37 of the Criminal Code, 18 U.S.C.A. § 88, provides that if two or more persons conspire either to commit any offense against the United States, or to defraud the United States in any manner or for any purpose, and one or more of such parties do any act to effect the object of the conspiracy, each of the parties to such conspiracy shall be fined not more than $10,000, or imprisoned not more than two years, or both.

The Emergency Price Control Act of 1942, as amended, authorizes the Price Administrator to issue such regulations, orders and requirements as he deems necessary to prevent the circumvention or evasion of the Act. In broad terms, it was made unlawful for anyone to violate regulations or orders promulgated by the Administrator. Section 205(b) of the Act provides, inter alia, that any person who makes any statement or entry false in any material respect in any document or report required to be kept or filed under Section 202 of the Act, 50 U.S.C.A.Appendix, § 922 shall be subject to stated fine and imprisonment.

The Maximum Price Regulation, No. 30, referred to in the indictment, requires (Section 1347.10) that "every person making purchases or sales of commercially packed wastepaper shall keep for inspection by the Office of Price Administration for so long as the Emergency Price Control Act of 1942 shall remain in effect, complete and accurate records of each purchase or sale of wastepaper", showing the date of purchase or sale, the name and address of the buyer or seller, the grade of waste paper purchased or sold, the quantity of each grade purchased or sold, and the price paid or received.

The indictment charged that the appellants and their unindicted coconspirators had unlawfully conspired to make and keep false, inaccurate and incomplete records "of proposed waste paper sales by co-conspirators Charles Ginns, Jacob Moss and Jack Ginns to defendants Alvin E. Sandroff and Thomas Paper Stock Company, a corporation".

Scienter of Section 1347.10 of Maximum Price Regulation No. 30 was charged to the defendants and their named coconspirators; and it was averred that the purpose of the conspirators was that the two Ginns and Moss might obtain, and Sandroff and Thomas Paper Stock Company might pay, a price for waste paper in excess of that permissible under the Emergency Price Control Act, as amended. Among the 19 overt acts alleged were shipments of carloads of "waste paper" from Detroit, Michigan, to Chicago, Illinois, by Charles Ginns to appellants; various specified advance payments, or payments caused to be made, "for waste paper to be sold" to the appellant corporation by the coconspirators, Moss and the Ginns, father and son; and cash payments to Jack Ginns by Derdiger, a bookkeeper for the appellants.

(1) There was no error in the denial by the trial judge of the motion to quash the indictment. Appellants' argument upon the point is that the indictment is fatally defective, in that the object of the conspiracy is alleged to have been the keeping of false, inaccurate and incomplete records of "proposed waste paper sales", when the pertinent statute and regulations do not require the keeping of records of proposed sales, or the keeping of records of sales of paper other than commercially packed waste paper. We think the indictment was sufficiently well drawn to embrace the essential elements of the conspiracy charged; to apprise adequately the defendants of the charges required to be met; and to place them in position, after trial, to plead autrefois convict or autrefois acquit.

Here, the test of the sufficiency of the indictment was quite as well met as it was in Bogy v. United States, 6 Cir., 96 F.2d 734, 736. See Williams v. United States, 6 Cir., 3 F.2d 933, 934, in which it was held that a motion to quash an indictment for conspiracy to violate the National Prohibition Act, 27 U.S.C.A. § 1 et seq., was properly overruled. The language of Judge Knappen in that case seems applicable in this one: "The gist of the offense charged is conspiracy. The indictment is not so vague and indefinite in its statement of facts as not to enable defendants intelligently to prepare their defense, or to have protection against further prosecutions. It is the general rule that an indictment charging conspiracy is sufficient, if it follows the language of the statute and contains a sufficient statement of an overt act to effect the object of the conspiracy. Citing authorities."

In Williamson v. United States, 207 U.S. 425, 447, 449, 28 S.Ct. 163, 171, 52 L.Ed. 278, Mr. Justice White (later Chief Justice) declared that where a conspiracy is charged, "the conspiracy is the gist of the crime, and certainty, to a common intent, sufficient to identify the offense which the defendants conspired to commit, is all that is requisite in stating the object of the conspiracy." Accordingly, assignments of error assailing the sufficiency of the indictment were held to be without merit. Citing the Williamson case and other authorities, Chief Justice Taft declared, in Thornton v. United States, 271 U.S. 414, 423, 46 S.Ct. 585, 588, 170 L.Ed. 1013, that the "rules of criminal pleading do not require the same degree of detail in an indictment for conspiracy in stating the object of the conspiracy as if it were one charging the substantive offense." See also Wong Tai v. United States, 273 U.S. 77, 81, 47 S.Ct. 300, 71 L.Ed. 545.

(2) Appellants insist that their motion for a directed verdict at the close of all the evidence should have been granted, and assert that there was no evidence introduced showing that there was a conspiracy to keep false records with respect to "commercially packed wastepaper" or with respect to any "document or report" required to be kept or filed. They say that the proof failed to bring them within the scope of Section 205(b) of the Emergency Price Control Act, penalizing "any person who willfully violates any provision of Section 4", or "who makes any statement or false entry in any material respect in any document or report required to be kept or filed under Section 2 or Section 202"; and that Section 1347.10 of Maximum Price Regulation No. 30, as amended, requires only persons making purchases or sales of commercially packed waste paper to make and keep complete and accurate records of prices paid or received on purchases or sales.

As authority for the proposition that the regulation in issue should be given no broader scope than its language requires, appellants point to the opinion of Mr. Justice Murphy in M. Kraus & Bros. Inc. v. United States, 66 S.Ct. 705, 708, 90 L.Ed. ___, decided March 25, 1946. In that case, the opinion writer for the majority of the court asserted that the same strict rule of construction must be applied to regulations of the Price Administrator as to criminal statutes; that courts must be careful not to construe so strictly as to defeat the obvious intention of the Administrator; that words used by him to describe evasive action must be given their natural and plain meaning, supplemented by his contemporaneous or long-standing interpretation; and that "prohibited conduct must, for criminal purposes, be set forth with clarity in the regulations and orders which he is authorized by Congress to promulgate under the Act."

In reply, the Government maintains that the record reveals that the conspirators, including the appellant Sandroff, agreed to falsify the records pertaining to all waste paper sales and that Sandroff clearly knew, understood and agreed that the records of commercially packed waste paper would be falsified, "because every shipment of wastepaper which he received without protest was baled and invoiced at the price for commercially packed paper."

This brings us to a discussion of the facts of the case. Sandroff had been in the waste paper business for 25 years. He was president of the Thomas Paper Stock Company, which had its main office in Chicago and did business as purchaser and seller of waste paper in several states, including Michigan. Charles Ginns, with some 11 years' experience in the waste paper business, was in partnership with Jacob Moss at Detroit, Michigan, under the firm name of Central Waste Material...