U.S. v. Solomon

Citation688 F.2d 1171
Decision Date22 September 1982
Docket NumberNo. 81-2954,81-2954
Parties82-2 USTC P 9591, 11 Fed. R. Evid. Serv. 971 UNITED STATES of America, Plaintiff-Appellee, v. Allan J. SOLOMON, Defendant-Appellant.
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)

Kenneth L. Cunniff, Chicago, Ill., for defendant-appellant.

Michele Smith, Asst. U.S. Atty., Dan K. Webb, U.S. Atty., Chicago, Ill., for plaintiff-appellee.

Before CUDAHY and COFFEY, Circuit Judges, and GRANT, * Senior District Judge.

COFFEY, Circuit Judge.

This case represents an appeal from the defendant's convictions for filing a fraudulent income tax return in 1974 and failing to file an income tax return in 1975 in violation of 26 U.S.C. § 7206(1) and 26 U.S.C. § 7203, respectively. Affirmed.

The defendant, Allan Solomon, contends that the trial court committed error when it allowed the government to present evidence of the defendant's flight to Denver, Colorado and his assumption of a new name in that locality. The defendant also charges that the trial court erred when it denied his motion to dismiss the indictment because of prejudicial and inexcusable pre-indictment delay. Finally, the defendant argues that he should be granted a new trial because the court erred in denying his motion for a mistrial based on the government's failure to disclose exculpatory material before trial, and that the trial court was incorrect in limiting cross-examination and thus prohibiting him from cross-examining two witnesses concerning the payment of $20,000 to settle a civil lawsuit pending against Solomon Realty.

The defendant is charged with failing to report income received from a number of real estate transactions on his 1974 and 1975 federal income tax returns. In 1971, Drs. Richard Markey and Peter Ferrini purchased forty-eight acres of real estate through Solomon Realty, a real estate company owned by the defendant's father, Adolph Solomon. 1 The Drs. Markey and Ferrini were told by Adolph Solomon that they were buying the land from one Peter Halligan, 2 with all payments on the contract to be made to Solomon Realty. The purchase price of the forty-eight acre tract was approximately $160,000, and the purchase agreement contract called for annual payments of approximately $20,000 plus interest from each of the doctors over a three year period. The final $40,000 payment on the land was due on March 1, 1974. Dr. Markey gave the defendant's father, Adolph Solomon, a check made out to Peter Halligan for $10,000 and asked for an extension of time on the payment of the second $10,000. Dr. Markey was granted a six-month extension. 3 Some time later, Dr. Markey was approached by the defendant, Allan Solomon, who informed the doctor that Peter Halligan needed his final $10,000 payment at this time. When Dr. Markey replied that he was unable to make the final payment at present, and would not be able to make it until such time as he was able to close another real estate transaction, the defendant suggested to Markey that his wife, Reva Solomon, would loan him (Markey) the money to make the final payment. Dr. Markey wrote a check for $5,000 payable to Reva Solomon in part payment of her alleged loan to him, and gave the defendant a note payable to Reva Solomon for the remaining $5,000 of the debt. The defendant cashed the $5,000 check payable to Reva Solomon and deposited the proceeds into his checking account. The defendant later had Dr. Markey's note discounted at a local bank and also deposited these funds into his checking account. Reva Solomon testified at trial that she had no knowledge of the loan to Dr. Markey nor had she endorsed any checks written to her by Dr. Markey. The defendant is charged in the federal indictment with receiving these payments from Dr. Markey and failing to report the same as income on his 1974 income tax return as required by the Internal Revenue Code.

Dr. Ferrini gave Solomon Realty a check made out to Peter Halligan for $11,200 in February of 1974 and asked for time to pay the remaining $10,000 due and owing. The defendant deposited the check from Dr. Ferrini into his checking account on February 28, 1974. Peter Halligan, the seller, testified that he never endorsed this check, and that he was unable to recall ever having received any payments directly from Dr. Markey. Some time later, the defendant Solomon contacted Dr. Ferrini and told Ferrini that Mr. Halligan was in need of the final $10,000 payment. Allan Solomon then suggested to Ferrini that he execute a note and that he (Solomon) would have the note discounted at a bank and use the proceeds from this transaction to make the final payment to Peter Halligan. Dr. Ferrini executed the ninety-day note made out to the First National Bank in Chicago Heights as requested for $10,000. In March of 1974 the defendant discounted this note and deposited the proceeds into his checking account. Following the same modus operandi the defendant failed to report this income on his 1974 income tax return, in violation of the Internal Revenue Code.

Also in 1974, the defendant told both Drs. Ferrini and Markey that the real estate taxes were due on the forty-eight acre parcel of land. Dr. Ferrini gave the defendant a check for $346.90 payable to Reva Solomon and Dr. Markey gave the defendant a check for $346.45 to cover his portion of the real estate taxes. The defendant cashed both Drs. Markey's and Ferrini's checks even though neither the defendant nor Reva Solomon nor Solomon Realty had paid the real estate taxes on the forty-eight acre tract. The defendant also failed to report this $693.35 as income on his 1974 income tax return.

The above recitation of payments reveals that in 1974 the defendant defrauded Drs. Markey and Ferrini, and received $10,212.21 and $21,355.81 from them, respectively. These amounts were not reported by the defendant as income on his 1974 tax returns as required by the Internal Revenue Code.

In early 1974 one Willie McGregory called upon Solomon Realty to purchase some farm land. The defendant, Allan Solomon, purported to sell five acres of Drs. Ferrini's and Markey's land to McGregory for $5,000 per acre, for a total sales price of $25,000, without the doctors' consent or knowledge. Mr. McGregory gave Allan Solomon the first $2,000 down payment on the land purchase in January of 1974. Thereafter, Mr. and Mrs. McGregory made periodic payments to the defendant Solomon on the property during 1974 totaling $4,250. The defendant either cashed and/or deposited all of this money. The defendant Solomon again failed to report this income on his 1974 tax return.

During 1975, in addition to the $4,250 they had already paid, the McGregorys made seven more payments to the defendant, totaling $3,000, to secure the land they had contracted to purchase. Even though the defendant had agreed to give the McGregorys title to one of the five acres of land after they had paid the sum of $5,000 and the McGregorys had now paid the defendant $7,250, the defendant refused to give the McGregorys the deed to the land. The defendant deposited or cashed all these McGregory checks, and failed to report these monies.

Although he had not received the deed, and believing that he owned the property and acting on the assurances of the defendant, McGregory began construction of a home on a portion of a one acre plot of land in 1975. Dr. Markey discovered McGregory's building and construction taking place, and approached McGregory at his place of work, telling him (McGregory) that he (Markey) and Dr. Ferrini owned this parcel of land. Eventually, McGregory negotiated a new deal to purchase this land from Drs. Markey and Ferrini and agreed to pay them an additional $2,500 per acre.

In 1975, the defendant contacted Dr. Ferrini and told him that a twenty-five foot parcel of land which was adjacent to some land which Dr. Ferrini owned in Chicago Heights was available for sale. Solomon told Dr. Ferrini that the purchase price was $1,250, and Dr. Ferrini wrote a personal check to the defendant for that amount. The defendant cashed Ferrini's check on May 1, 1975 and failed to turn the proceeds from this check over to the owners of this twenty-five foot parcel of land and failed to report this $1,250 as income in his 1975 income tax return.

In 1975 the defendant, Allan Solomon, again approached Dr. Markey and asked Dr. Markey to invest in the purchase of a farm, consisting of a barn and brick home, for the purposes of converting these buildings into a restaurant and accompanying shops. Markey agreed to invest $8,333 which represented one-third of the $25,000 down payment and thereby obtain a one-third interest in the venture. Because Markey still owed $3,000 on the purported loan from Reva Solomon, he executed a note for $11,333, representing the $8,333 he was investing into the farm and the payment of $3,000 on the 1974 "loan." The defendant discounted this note and deposited the proceeds into his checking account on February 3, 1975. The defendant never transmitted Markey's $8,333 payment to the owner of the farm, Mary Smit, but rather kept the money and also failed to report this $8,333 in his 1975 income tax return.

In March of 1975 the defendant, again focusing on the medical profession, sent a telegram to a Dr. Myriam Wilson Leonardo who had previously demonstrated an interest in purchasing the defendant's home. The defendant informed Dr. Leonardo that the current asking price had been lowered to $160,000. Dr. Leonardo contracted with the defendant to purchase the house for that price, and made a total down payment of $16,000 to the defendant in the form of four different checks. The defendant deposited all of these checks into his personal checking account. The defendant's wife, Reva Solomon, testified at a deposition that she never authorized the sale of the family home for $160,000, and never signed a sales contract or received any of the $16,000 down payment from Dr. Leonardo....

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