554 F.2d 36 (2nd Cir. 1977), 631, United States v. Rosenblatt

Docket Nº:631, Docket 76-1443.
Citation:554 F.2d 36
Party Name:UNITED STATES of America, Appellee, v. Elyakim G. ROSENBLATT, Defendant-Appellant.
Case Date:April 19, 1977
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

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554 F.2d 36 (2nd Cir. 1977)

UNITED STATES of America, Appellee,


Elyakim G. ROSENBLATT, Defendant-Appellant.

No. 631, Docket 76-1443.

United States Court of Appeals, Second Circuit

April 19, 1977

Argued Jan. 6, 1977.

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Robert E. Goldman, New York City (Andrew R. Cooper, Kuh, Shapiro, Goldman, Cooperman & Levitt, P.C., New York City, of counsel), for defendant-appellant.

Angus Macbeth, Asst. U. S. Atty., New York City (Robert B. Fiske, Jr., U. S. Atty., Audrey Strauss, Asst. U. S. Atty., S.D.N.Y., New York City, of counsel), for appellee.

Before MANSFIELD, GURFEIN and MESKILL, Circuit Judges.

MESKILL, Circuit Judge:

The material facts of this unusual conspiracy case are not in dispute. Morris D. Brooks, the appellant's alleged co-conspirator, made false entries in the accounts payable records at the Manhattan Postal Service headquarters where he worked and thereby obtained eight checks totalling over $180,000. The checks were drawn on the United States Treasury and were payable to individuals having no claim to payment from the Postal Service. Brooks was caught and indicted for conspiracy to defraud the United States, 18 U.S.C. § 371. He was also charged with eight counts of falsifying postal records in violation of 18 U.S.C. § 2073. After pleading guilty to conspiracy and to one count of making false entries, he testified against the appellant. Brooks was sentenced to five years imprisonment, but execution of the sentence was suspended, and he was placed on probation for five years.

Appellant, Rabbi Elyakim G. Rosenblatt was the Dean of the Rabbinical College of Queens. At Brooks' request, he "laundered" the eight checks through the college's bank account, and kept roughly ten percent of the face value of the checks for his services. Rosenblatt was indicted, along with Brooks, for conspiracy to defraud the United States. After pleading not guilty, he was tried and convicted by a jury and sentenced to six months imprisonment and a fine of $8,000.

Our difficulty with Rosenblatt's conviction arises from the lack of any agreement between him and Brooks concerning the type of fraud in which they were engaged. It is clear that Brooks was defrauding the United States by obtaining payment for government checks which he had caused to

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be printed without authorization. The government stipulated, however, that Rosenblatt did not know the truth about Brooks' activities. Brooks led him to believe that the checks were valid. He told Rosenblatt that the purpose of the laundering operation was to help some payees evade taxes and to help other payees conceal kickbacks on government contracts. In other words, both men agreed to defraud the United States, but neither agreed on the type of fraud. On this appeal, Rosenblatt argues that under 18 U.S.C. § 371 a conspiracy to defraud the United States must be grounded upon agreement on some common scheme or plan. 1 He maintains that proof of an agreement to defraud, without further qualification as to the nature of the fraud, is insufficient to support a conviction under § 371. We agree and reverse the conviction.

The Lack of Agreement.

A conspiracy is an "agreement among the conspirators." United States v. Falcone, 311 U.S. 205, 210, 61 S.Ct. 204, 85 L.Ed. 128 (1940) (emphasis added). A "meeting of minds" is required. Krulewitch v. United States, 336 U.S. 440, 448, 69 S.Ct. 716, 93 L.Ed. 790 (1949) (Jackson, J., concurring). "(U)nless at least two people commit (the act of agreeing), no one does. When one of two persons merely pretends to agree, the other party, whatever he may believe, is in fact not conspiring with anyone." Developments in the Law Criminal Conspiracy, 72 Harv.L.Rev. 920, 926 (1959) (hereinafter cited as Developments); see Sears v. United States, 343 F.2d 139 (5th Cir. 1965) (no conspiracy with government informant who secretly intends to frustrate the conspiracy); Delaney v. State, 164 Tenn. 432, 51 S.W.2d 485 (1932) (no conspiracy with person who feigns agreement). 2

The law of conspiracy requires agreement as to the "object" of the conspiracy. Developments 929-33. This does not mean that the conspirators must be shown to have agreed on the details of their criminal enterprise, but it does mean that the "essential nature of the plan" must be shown. Blumenthal v. United States, 332 U.S. 539, 557, 68 S.Ct. 248, 92 L.Ed. 154 (1947).

The problem of identifying the "essential nature" of the conspirators' plan often arises in cases in which knowledge is in issue. An examination of those cases sheds some light on the degree of specificity that is required as to the agreement. In Ingram v. United States, 360 U.S. 672, 79 S.Ct. 1314, 3 L.Ed.2d 1503 (1959), two individuals who had assisted in the operation of a lottery that was illegal under state law were convicted of conspiracy to evade federal wagering taxes for which their employers were liable. The Supreme Court reversed because there had been no evidence that the individuals knew of the tax liability. Absent such knowledge, tax evasion could not have been one of the objectives of their conspiracy, and the convictions could not stand. In contrast, the convictions of the employers for conspiracy to evade taxes were upheld. Similarly, in United States v. Gallishaw, 428 F.2d 760 (2d Cir. 1970), the defendant was convicted after a trial judge charged the jury that he could be convicted of conspiracy to rob a bank if he had rented a machine gun to another individual "with the knowledge 'that there was a conspiracy to do something wrong and to use the gun

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to violate the law.' " Id. at 762. This Court reversed. We said that "at the very least" the government was required to show "that he knew that a bank was to be robbed." Id. at 763. We explained that the defendant "had to know what kind of criminal conduct was in fact contemplated." Id. at 763 n. 1; cf. United States v. Calabro, 467 F.2d 973, 982 (2d Cir. 1972), cert. denied, 410 U.S. 926, 93 S.Ct. 1357, 35 L.Ed.2d 587 (1973) (supplier of false identification must have known that it would be used in a transaction involving forged bonds in order to be guilty as an aider and abettor; generalized suspicion of illegal use would not suffice). Thus, it is clear that a general agreement to engage in unspecified criminal conduct is insufficient to identify the essential nature of the conspiratorial plan.

Proof of the essential nature of the plan is required because "the gist of the offense remains the agreement, and it is therefore essential to determine what kind of agreement or understanding existed as to each defendant." United States v. Borelli, 336 F.2d 376, 384 (2d Cir. 1964), cert. denied, 379 U.S. 960, 85 S.Ct. 647, 13 L.Ed.2d 555 (1965). The importance of making this determination cannot be overstated. "(A)greement is the essential evil at which the crime of conspiracy is directed" and it "remains the essential element of the crime." Iannelli v. United States, 420 U.S. 770, 777 n. 10, 95 S.Ct. 1284, 1290, 43 L.Ed.2d 616 (1975). "Nobody is liable in conspiracy except for the fair import of the concerted purpose or agreement as he understands it." United States v. Peoni, 100 F.2d 401, 403 (2d Cir. 1938). A conspirator's liability for substantive crimes committed by his co-conspirators depends on whether the crimes were committed "in furtherance of the unlawful agreement or conspiracy." Pinkerton v. United States, 328 U.S. 640, 645, 66 S.Ct. 1180, 1183, 90 L.Ed. 1489 (1946). Similarly, the admissibility against a defendant of a co-conspirator's declaration depends on whether the declaration was made "during the course and in furtherance of the conspiracy." Fed.R.Evid. 801(d)(2)(E). This determination can be made only after the scope of the agreement has been defined. The question of whether single or multiple conspiracies have been pled or proved depends on the nature of the agreement. United States v. Dardi, 330 F.2d 316, 327 (2d Cir.), cert. denied, 379 U.S. 845, 85 S.Ct. 50, 13 L.Ed.2d 50 (1964). Because overt acts are acts "to effect the object of the conspiracy," 18 U.S.C. § 371 (emphasis added), they are defined by reference to the conspiratorial agreement. United States v. Bayer, 331 U.S. 532, 542, 67 S.Ct. 1394, 91 L.Ed. 1654 (1947). In addition, when questions arise concerning matters such as venue, Hyde v. United States, 225 U.S. 347, 32 S.Ct. 793, 56 L.Ed. 1114 (1912), or the statute of limitations, Grunewald v. United States, 353 U.S. 391, 396-97, 77 S.Ct. 963, 1 L.Ed.2d 931 (1957), which depend on the formation of the agreement or the occurrence of overt acts, it becomes "crucial," id. at 397, 77 S.Ct. 963, to determine the scope of the conspiratorial agreement. See Bridges v. United States, 346 U.S. 209, 224, 73 S.Ct. 1055, 97 L.Ed. 1557 (1953) (statute of limitations). Finally, the punishment that may be imposed under § 371, for a conspiracy to commit an offense against the United States, depends on whether the "object" of the conspiracy is a felony or a misdemeanor. In order to make this determination, specificity with respect to the "object" of the conspiracy is essential.

It is clear that, under the general rules of conspiracy, Rosenblatt could not have been validly convicted of conspiracy to make false entries on postal records, 18 U.S.C. § 2073, the substantive crime with which Brooks was charged, because he had no knowledge of such a plan; he neither intended nor agreed to commit that offense, or any other offense of which Brooks might have been guilty, e. g., 18 U.S.C. § 641 (embezzlement of public money). The only offenses that Rosenblatt "agreed" 3 to aid and abet were tax evasion, 26 U.S.C. § 7201, and taking kickbacks on government contracts,

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18 U.S.C. § 874, 4 but since no one else agreed to commit those offenses, a conviction for conspiracy to commit them could not stand.

Conspiracy To Defraud The United States.

The general federal...

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