Israel v. United States

• Decision Date: 03 February 1925
• Docket Number: No. 4090.,4090.
• Citation: 3 F.2d 743
• Parties: ISRAEL et al. v. UNITED STATES.
• Court: U.S. Court of Appeals — Sixth Circuit

3 F.2d 743 (1925)

ISRAEL et al. v. UNITED STATES.

No. 4090.

Circuit Court of Appeals, Sixth Circuit.

February 3, 1925.

Allen C. Roudebush, of Cincinnati, Ohio (Edward M. Hurley, of Cincinnati, Ohio, on the brief), for plaintiffs in error.

Harry A. Abrams, Asst. U. S. Atty., of Cincinnati, Ohio (Benson W. Hough, U. S. Atty., of Columbus, Ohio, and Haveth E. Mau, Asst. U. S. Atty., of Cincinnati, Ohio, on the brief), for the United States.

Before DENISON, MACK, and KNAPPEN, Circuit Judges.

KNAPPEN, Circuit Judge.

Plaintiff in error Israel was in the business, at Middletown, Ohio, of retailing ladies' and children's clothing and accessories. Petition in bankruptcy was filed against him March 15, 1923; adjudication was made April 23, and trustee appointed May 11, 1923. Plaintiff in error Sussman was in business at Newport, Ky., from November 1, 1922, to February 15, 1923. June 1, 1923, Israel, Sussman and one Schwartz were indicted upon a charge of conspiracy under section 37 of the Penal Code (Comp. St. § 10201) to violate section 29 of the Bankruptcy Act (Comp. St. § 9613) — the specific charge being that the three defendants conspired among themselves and with other persons to the grand jurors unknown, "in contemplation and in anticipation of the involuntary bankruptcy of said defendant, Charles A. Israel, to secrete and conceal from the trustee" of Israel's bankruptcy estate, to be thereafter appointed, certain property which would then and there belong to said bankruptcy estate, "to wit, ladies' hosiery, gloves, coats, fur coats, dresses, cloaks, silk underwear, and the money for which said merchandise might thereafter be sold or exchanged," etc., then and there Israel's property, and charging Israel's later bankruptcy; also that the defendants so conspiring "continued to secrete and conceal," while Israel was a bankrupt, from the duly appointed trustee of the assets of the bankruptcy estate, certain property then and there belonging to said estate by general description. The overt acts set out alleged, among other things, the fraudulent removal by Israel and Sussman from a given address at Middletown, Ohio, of trunks of merchandise; other such removals by Israel and Sussman; others by Israel and Schwartz; others of receipt by Sussman, at Newport, Ky., of certain trunks and trucks of merchandise; and still others the entering upon Israel's books of account of fictitious entries, purporting to represent sales of merchandise — all laid as of dates preceding the bankruptcy. Demurrers to and motion to quash the indictment were overruled, as was a motion to direct verdict for defendants made at the close of the testimony. Schwartz was acquitted.

1. Sufficiency of Indictment. It is argued here that Sussman and Schwartz, not being bankrupts, could not violate section 29 of the Bankruptcy Act, and therefore could not be indicted for conspiring to violate that section. We think this criticism without merit. It is well settled that a person may be guilty of conspiring to commit, although himself incapable of committing, the substantive offense. United States v. Holte, 236 U. S. 140, 145, 35 S. Ct. 271, 59 L. Ed. 504, L. R. A. 1915D, 281; United States v. Rabinowich, 238 U. S. 78, 86, 35 S. Ct. 682, 59 L. Ed. 1211; Jollit v. United States (C. C. A. 5) 285 F. 209, 213 et seq. (certiorari denied Saliba v. United States, 261 U. S. 624, 43 S. Ct. 519, 67 L. Ed. 832).

We see no merit in the suggested distinction between the participation by Sussman and Schwartz with the bankrupt in a conspiracy to conceal, and one by defendants other than the bankrupt to cause the latter to conceal. Neither do we see any pertinency in the fact that certain of the overt acts are charged to have been committed more than four months before the bankruptcy.

2. The motion to instruct verdict for defendants was properly overruled. There was competent and substantial testimony of circumstances reasonably tending to show frequent secret removals of goods in trunks, and in substantial amounts, from Israel's store in Middletown, Ohio, to that of Sussman in Newport, Ky.; of the finding in the latter's store of goods which had been bought by and shipped to the former; of the failure of Israel's books to show any sales to Sussman; of the return from time to time of empty trunks from Sussman to Israel; of the making of large numbers of fictitious entries of sales of goods, many in substantial amounts, as well as of large apparent discrepancies between the amount of goods purchased by Israel (and the amount which should normally have been on hand) and the amount found by the trustee in bankruptcy; and testimony tending to show that such discrepancies were not otherwise sufficiently accounted for, as well as testimony of facts tending to show familiar relations between Israel and Sussman, including apparent financial interest by the former in the latter's Newport business. Such acts were competent evidence tending to show an intention to conceal from the trustee. Meyer v. United States (C. C. A. 5) 220 F. 822, 136 C. C. A. 432; Glass v. United States (C. C. A. 3) 231 F. 65, 145 C. C. A. 253. The alleged conspiracy would naturally look to the future. Cf. Williamson v. United States, 207 U. S. 425, 446 et seq., 28 S. Ct. 163, 52 L. Ed. 278.

That the existence of a conspiracy may be shown by inference, see Davidson v. United States (C. C. A. 6) 274 F. 285, 287. We cannot weigh the evidence or pass upon, the credibility of witnesses. Burton v. United States, 202 U. S. 344, 373, 26 S. Ct. 688, 50 L. Ed. 1057, 6 Ann. Cas. 392; Kelly v. United States (C. C. A. 6) 258 F. 392, 406, 169 C. C. A. 408.

3. Admission and Rejection of Evidence. Numerous errors are assigned relating to this subject. We find it necessary to discuss but two:

(a) As already stated, Sussman opened his store at Newport, Ky., November 1, 1922, and continued it until February 15, 1923, when he sold out. On the trial an attorney living at Muncie, Ind., testified to his employment by Sussman, in September, 1922, to replevin some goods from a named person; that he saw in the latter's store the merchandise, consisting of women's and children's wearing apparel, etc., which the sheriff seized under the writ from the store last mentioned, placed in a trunk and held by the sheriff until September 23d, when the goods were delivered to the witness, who ordered them shipped to a named dealer in Cincinnati, Ohio. On motion of the government, the court instructed the jury to disregard all evidence of the replevin suit in Muncie. The court did not exclude evidence of the shipment of the goods, but only of the replevin suit itself, which at that time was not shown to be material. It was not made material, except by Sussman's later testimony, and the offer does not seem to have been renewed....