U.S. v. Nicholson

Decision Date14 January 1976
Docket NumberNo. 74--3724,74--3724
PartiesUNITED STATES of America, Plaintiff-Appellee, v. Robert NICHOLSON and William Nicholson, Defendants-Appellants.
CourtU.S. Court of Appeals — Fifth Circuit

Stanley W. Greenfield, Pittsburg, Pa., for Robert.

Roger I. Dallam, Gretna, La. (Court-appointed), for Wm. Nicholson.

Gerald J. Gallinghouse, U.S. Atty., Ronald A. Tronseca, Mary Williams Cazalas, Asst. U.S. Attys., New Orleans, La., for plaintiff-appellee.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before WISDOM, GEWIN and AINSWORTH, Circuit Judges.

AINSWORTH, Circuit Judge:

Appellants Robert J. Nicholson and William Nicholson appeal from their conviction after trial by jury of conspiracy to transport property worth more than $5,000 in interstate commerce, knowing the property to have been stolen, in violation of 18 U.S.C. §§ 371 and 2314. We have carefully examined each of the errors asserted by appellants and find them to be without merit. Accordingly, we affirm the convictions.

The Government's evidence was to the effect that appellants conspired with James Lawhon, a coindictee who pled guilty and testified for the Government as its principal witness. Lawhon, who was a former Bell Telephone Company employee, committed numerous burglaries of Southern Bell (now South Central Bell) properties in the New Orleans area on more than 104 occasions, and stole new and reconditioned telephones which he sold and shipped to appellants' company, Nichco, Inc., in Lexington, Ohio. From September 1970 continuously through December 1972 (except for several months), Lawhon stole and shipped approximately 200 such telephones, a substantial number being new equipment, each week to appellants. Lawhon communicated by long distance about these transactions with both defendants about once a week, or more than 100 times. Lawhon used fictitious names and addresses on all of the invoices and packages shipped to Nichco, but pursuant to telephone arrangements Nichco checks were made payable to Lawhon and forwarded to his proper address in New Orleans. Lawhon was paid in excess of $40,000 by the Nicholsons over the 2 1/2-year period involved. Nichco then sold the telephones, mostly to Olson Electronics, Akron, Ohio, for approximately double this amount. FBI agents observed some of Lawhon's burglaries and thefts of the telephones, also appellants each picking up a shipment of the telephones at the Columbus, Ohio Airport. Pursuant to a search warrant, a large number of Bell System telephones were recovered by the FBI at the Nichco premises in Lexington, Ohio.

Whenever a shipment of telephones arrived Nichco employees turned aside from other work and immediately took them out of the boxes which had 'Bell System' and markings on the side and destroyed the boxes by crushing and burning them. Identification markings on the telephones, 'Bell System Property--Not for Sale,' were ground and buffed off by Nichco employees under direction of the Nicholsons.

Appellants each testified and denied the conspiracy or any knowledge that the telephones were stolen, though they admitted they made no inquiries of Southern Bell to determine if the telephones could be sold.

Appellants assert as error the admission of testimony by the Government, over their objection, as to prices paid by Southern Bell to Western Electric for such telephones. The purpose of this proof was to show knowledge of the Nicholsons that they were stolen since they paid Lawhon for the telephones only about 1/4 of the Western Electric price. Incidentally, when FBI agents searched Lawhon's home they found a copy of the South Central Bell Telephone-Western Electric stock price list in Lawhon's desk, and it was received in evidence at the trial. Appellants contend, however, that the price was not a true price because of the corporate relationship between Southern Bell and Western Electric. In our view the evidence was admissible, and given the corporate relationship referred to, the weight to be accorded the evidence was for the jury to determine. The evidence was, therefore, properly admitted by the trial court.

Appellants also assert as error the denial of their motions for mistrial based on questions by the Government of defense witnesses as to criminal or improper conduct by others in association with Robert Nicholson in other incidents of the sale of telephone equipment. As to this issue, the trial court sustained defense objections to the sale of telephones by Nichco to Bennett and Beams. Also sustained was the defense's objection to questions to Assistant United States Attorney Bailey as to whether a plea bargain had been made with Lawhon relative to his testimony in other cases. However, on questions by the trial judge the Assistant United States Attorney testified that there were other cases besides the present one. The Government contends, and we agree, that it had the duty to disclose the details of its plea bargaining agreement with Lawhon and that the testimony produced was in response thereto. We find no error or prejudice under the circumstances.

The next error complained of by appellants is that the trial judge made remarks concerning the credibility of the witness, Thomas, in a loud voice that could have been overheard by the jury. There is no way to determine on appeal whether this issue is well taken since nothing was done by defense counsel to preserve this point for review. The district judge was not asked to inquire of the jury whether they overheard his remarks and he was not asked to give the jury a cautionary instruction. Nor do we consider the remark of the trial court that the witness, Rowlands, was 'a bookkeeper without books,' of sufficient consequence or prejudice to warrant reversal. The district court later gave a cautionary instruction covering generally the subject matter of these objections.

Appellants also contend that the district court erred in denying the motion to quash the indictment. They contend that appellants' testimony alone constituted the evidentiary basis for the indictment, and that since the court suppressed appellants' testimony before the grand jury, there was no competent evidence upon which the grand jury could have relied to support its indictment. 1 There is no indication in the record that the indictment was based solely on the testimony of the Nicholsons. The Assistant United States Attorney in oral argument on appeal informed the court that there was other evidence presented to the grand jury which was not transcribed and offered to supplement the record in this regard if required by us. We do not believe supplementing the record is required. No attempt was made by appellants to preserve this point for appeal by proof that the only witnesses who testified at the grand jury proceeding were the Nicholsons. Even so, the contention is without merit since the Supreme Court has recently decided that the exclusionary rule may not be extended to grand jury proceedings. The Nicholsons' testimony was, therefore, properly before the grand jury even though suppressed for trial purposes. See United States v. Calandra, 414 U.S. 338, 94 S.Ct. 613, 620--621, 38 L.Ed.2d 561 (1974); United States v. Boerner, 5 Cir., 1975, 508 F.2d 1064, 1068. In Costello v. United States, 350 U.S. 359, 363--364, 76 S.Ct. 406, 409, 100 L.Ed. 397, the Supreme Court said to 'establish a rule permitting defendants to challenge indictments on the ground that they are not supported by adequate or competent evidence' . . . 'would run counter to the whole history of the grand jury institution . . ..' That the trial judge followed the applicable law is shown by his denial of the motion to quash the indictment, despite his granting of the motion to suppress the grand jury testimony of Robert and William Nicholson.

Appellant William Nicholson also contends that there was error in denial of his motion for judgment of acquittal. He also contends that the Government failed to prove that the defendant had knowledge that the telephones involved were stolen. There was ample evidence, however, to connect this appellant with the transaction. FBI Agent Huddleston testified to an oral statement taken from William Nicholson that Nichco had been purchasing telephones from Lawhon for several years. William Nicholson said that his brother, Robert Nicholson, did most of the paper work and that he primarily traveled and sold equipment. He said he picked up a number of cartons of telephones received from Lawhon at the Columbus Airport and that they were then ground and buffed and the words 'Bell System--Not for Sale' taken off because customers did not like to have this notation on the telephones. He said that Lawhon told him by telephone that he had a legitimate source for obtaining the telephones; further, that he did not see how anyone could steal that quantity of telephones.

There was other evidence such as Lawhon's telephone admonitions to both Nicholsons to be careful; that he was concerned about the situation because he did not have any documents to back up the shipments of phones though they were coming through Western Electric. Lawhon testified that defendants told him they would send some documents obtained from New England Bell that would protect him but he never got them though he asked Robert Nicholson, and later William Nicholson, about it. Approximately 52...

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