U.S. v. Oxman

• Decision Date: 28 September 1984
• Docket Number: Nos. 83-1531,83-1532,s. 83-1531
• Citation: 740 F.2d 1298
• Parties: 16 Fed. R. Evid. Serv. 505 UNITED STATES of America v. Harold OXMAN, Appellant. UNITED STATES of America v. William H. PFLAUMER, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

Page 1298

740 F.2d 1298

16 Fed. R. Evid. Serv. 505

UNITED STATES of America v. Harold OXMAN, Appellant.

UNITED STATES of America v. William H. PFLAUMER, Appellant.

Nos. 83-1531, 83-1532.

United States Court of Appeals,

Third Circuit.

Argued April 6, 1984.

Decided Aug. 1, 1984.

Rehearing and Rehearing In Banc

Denied Sept. 12 and Sept. 28, 1984.

Thomas Q. Ciccone, Jr., Philadelphia, Pa., for appellant, Harold oxman.

Donald J. Goldberg (argued), Philadelphia, Pa., Joseph A. Tate, Stephen D. Brown, Jeffrey W. Golan, Schnader, Harrison, Segal & Lewis, Philadelphia, Pa., for appellant, William H. Pflaumer.

Edward S.G. Dennis, Jr., U.S. Atty., E.D. Pa., Philadelphia, Pa., Sidney M. Glazer, Karen I. Skrivseth, Attys., Dept. of Justice, Washington, D.C., Ronald G. Cole (argued), Sp. Atty., Dept. of Justice, Philadelphia, Pa., for appellee.

Before GIBBONS and SLOVITER, Circuit Judges and MENCER, District Judge. ^*

OPINION OF THE COURT

GIBBONS, Circuit Judge.

Harold Oxman and William H. Pflaumer appeal from sentences imposed following their convictions of mail fraud, 18 U.S.C. Sec. 1341 (1982), and conspiracy to commit mail fraud, 18 U.S.C. Sec. 371 (1982). Their convictions arise from a scheme to defraud the states of Pennsylvania, Maryland, and New Jersey of fuel excise and road use taxes properly due from a corporation, Wm. H.P., Inc. (WHP), owned by Pflaumer. The defendants contend that certain errors in the conduct of the trial and the government's deliberate nondisclosure of evidence favorable to the defense require a new trial. We conclude that Oxman's conviction must be affirmed, but that in Pflaumer's case an erroneous charge and the deliberate nondisclosure of evidence favorable to the defense, require a new trial.

I. The Scheme

Pflaumer is the sole stockholder of WHP, a corporation engaged in the trucking business in Philadelphia, Pennsylvania. Charles Gillan was the President of WHP; Raymond Hill was its Philadelphia Terminal manager, Ralph Wille its comptroller. Pflaumer owns several other businesses, including a Philadelphia brewery, C. Schmidt & Sons, Inc., and another trucking firm, Burgmeyer Bros., Inc. Oxman was, at relevant times, a commission salesman for Park Oil Co., a fuel oil supplier in Newark, Delaware. Before it went out of business, Park Oil was owned by Oxman's cousin, Frank Jock. United Fuel Oil and Burner Co. is a fuel oil supplier in Philadelphia, owned by John Luciano.

WHP's diesel fuel is purchased in bulk, delivered to the WHP terminal in Philadelphia. As a bulk purchaser, WHP is entitled to file monthly returns and make monthly payments of the nine cents-per-gallon Pennsylvania excise tax on diesel fuel. Pennsylvania also charges a road use tax of nine cents per gallon. Taxpayers are permitted to offset any state fuel excise taxes against the road use tax. Maryland and New Jersey both have similar fuel excise and road use taxes, at rates of eight cents per gallon. The scheme charged in the indictment involved the alteration of invoices for diesel fuel supplied to WHP at its Philadelphia terminal in order to indicate, falsely, that the fuel was delivered to WHP in Maryland or New Jersey. This permitted the filing of false monthly excise tax returns with the Commonwealth of Pennsylvania which underreported the excise taxes due to that state. WHP filed no excise tax returns with Maryland and New Jersey but, on road use tax returns, claimed credit for excise taxes on bulk purchases allegedly delivered in those states. Mailings in furtherance of the scheme took place between April of 1978 and June of 1979. The indictment charges 21 substantive counts of mail fraud and a single count of conspiracy to commit mail fraud. Those indicted for mail fraud are Gillan, Oxman, Pflaumer and Hill. These four and Luciano are charged in the conspiracy count, which names Frank Jock as an unindicted co-conspirator. Willie is not named either as a defendant or as a co-conspirator.

Prior to trial Gillan pleaded guilty to all counts. Pursuant to a plea agreement with the government, Luciano pleaded guilty to the conspiracy count. Oxman, Pflaumer and Hill stood trial. At trial the government sought, through the testimony of Luciano, Jock, Wille, and others, to establish that Oxman, Pflaumer and Hill all knew of the false invoice and tax fraud scheme, details of which are referred to hereafter. The theory of the defense was that while the mail fraud occurred, it was a matter about which the defendants had no knowledge and for which Gillan was solely responsible. Gillan did not testify.

II. Pre-trial Discovery

Before trial Pflaumer tendered a number of discovery requests to the government. One series of requests sought all evidence having to do with criminal conduct on the part of any person to be called as a prosecution witness. ¹ A second series sought documents evidencing benefits conferred on, or agreements made with, potential government witnesses, including, specifically, immunity agreements. ²

In response to these quite detailed requests, the government disclosed to counsel the prior criminal records of Luciano and Frank Jock, and disclosed that the government had entered into agreements with both men in exchange for their "truthful cooperation." Luciano's agreement involved his pleading guilty to the conspiracy count and to an independent charge of federal tax evasion. In exchange for his cooperation, the government agreed to forego further prosecution of Luciano and to report his cooperation at sentencing. Jock was already serving a term of incarceration for prior convictions. For his cooperation the government agreed to advise the Parole Board that he was cooperating and would be a good candidate for parole.

Although the requests were specific and covered all witnesses, the Luciano and Jock agreements were the only agreements disclosed to the defense. This, despite the fact that, as the United States Attorney well knew, the United States had entered into a written agreement, quoted in full in the margin, ³ by which Wille was given use immunity with respect to information or evidence "relative to the federal investigation into certain activities of Charles Gillan and others during the period between June 2, 1978 and December, 1979." App. at 1529. The Wille agreement was not disclosed to the court or to counsel. Counsel for the defendants were unaware of the agreement until June 15, 1983, the day after the jury verdict, when Pflaumer's counsel heard about it from another attorney.

III. Claimed Trial Error

A. Vouching for the Credibility of Jock and Luciano

Oxman and Pflaumer both contend that a new trial is warranted because the prosecuting attorney, during the trial and in closing argument, vouched for the truthfulness of the witnesses Frank Jock and John Luciano.

The alleged instances of vouching during the trial occurred when on direct examination the prosecuting attorney called to the jury's attention that the plea agreements, which had been disclosed to defense counsel, obliged them to testify truthfully. The government could reasonably anticipate that the beneficial features of the agreements would be used for impeachment purposes on cross-examination. If they were so used, reference to the condition requiring truthful testimony would be proper rehabilitation. See, e.g., United States v. Rohrer, 708 F.2d 429, 433 (9th Cir.1983); United States v. Edwards, 631 F.2d 1049, 1051-52 (2d Cir.1980). Since the government could reasonably anticipate such impeachment, it was not improper to anticipate it on direct examination by disclosing the truthful-testimony condition. See United States v. Henderson, 717 F.2d 135, 137-38 (4th Cir.1983), cert. denied, --- U.S. ----, 104 S.Ct. 1006, 79 L.Ed.2d 238 (1984). Indeed, some courts have held that reference to the truthful-testimony condition is proper even when the witness' credibility is not put in issue. See United States v. Winter, 663 F.2d 1120, 1133 (1st Cir.1981); United States v. Hedman, 630 F.2d 1184, 1198-99 (7th Cir.1980); United States v. Craig, 573 F.2d 513, 519 (7th Cir.), cert. denied, 439 U.S. 820, 99 S.Ct. 83, 58 L.Ed.2d 111 (1978).

The vouching during closing argument on which Oxman and Pflaumer rely occurred when the prosecuting attorney argued:

John Luciano's testimony and the agreement that he entered into with the government is tied in to a condition that is written, and it is carved in stone, and there is no way around it. John Luciano must tell the truth. If he does not, he is going to be in far worse trouble than he already is.

App. at 1424-25. These two sentences, while hyperbolic, accurately describe the agreement with Luciano and the likely consequences of its breach. They were, therefore, appropriate responses to the defendants' attack on Luciano's credibility. Several sentences later, however, the prosecuting attorney continued:

If I made a mistake in entering into that deal with John Luciano, then I personally will have to be responsible for it.

App. at 1425. The reference to counsel's personal responsibility in the event the jury believed him "mistake[n] in entering into that deal with John Luciano" was not an appropriate response. But this isolated reference to the possibility that the prosecuting attorney would be personally disadvantaged for entering injudiciously into a plea bargain with a witness, while in our view improper, is not ground for a new trial. Fed.R.Crim.P. 52(a).

B. Exclusion of Evidence

1. Other crimes evidence

Oxman contends that the trial court erred in excluding the testimony of an accountant that Luciano had defrauded Temple University of over $350,000. The trial court properly held that this evidence of specific instances of misconduct of a witness was inadmissible by virtue of Fed.R.Evid. 608(b).

2. Evidence of other tax payments

Pflaumer urges that the trial court erred in excluding evidence that during the time WHP was defrauding the states of Pennsylvania, Maryland, and New...